Submission Parts
1 |
SEC Form |
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SCHEDULE 13D/A |
2 |
SEC Form |
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EXHIBIT 99.G |
3 |
SEC Form |
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EXHIBIT 99.H |
4 |
SEC Form |
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EXHIBIT 99.I |
5 |
SEC Form |
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EXHIBIT 99.J |
SCHEDULE 13D/A
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
AMENDMENT NO. 4 to
SCHEDULE 13D
Under the Securities Exchange Act of 1934
(Amendment No. 4 to Schedule 13D)*
Twitter Inc.
(Name of Issuer)
Common Stock
(Title of Class of Securities)
90184L102
(CUSIP Number)
John Lutz
Heidi Steele
McDermott Will & Emery LLP
444 West Lake Street, Suite 4000
Chicago, IL 60606
(312) 372-2000
(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)
April 25, 2022
(Date of Event
Which Requires Filing of This Statement)
If the filing person has previously filed a statement on Schedule 13G
to report the acquisition that is the subject of this Schedule 13D, and is filing this schedule because of Rule 13d-1(e), Rule 13d-1(f)
or Rule 13d-1(g), check the following box. x
Note: Schedules filed in paper format shall include a signed
original and five copies of the schedule, including all exhibits. See Rule 13d-7(b) for other parties to whom copies are to be sent.
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The remainder of this cover page shall be filled out for a reporting person’s initial filing on this form with respect to the subject class of securities, and for any subsequent amendment containing information which would alter disclosures provided in a prior cover page. |
The information required on the remainder of this cover page shall
not be deemed to be “filed” for the purpose of Section 18 of the Securities Exchange Act of 1934 (“Act”)
or otherwise subject to the liabilities of that section of the Act but shall be subject to all other provisions of the Act (however, see
the Notes).
SCHEDULE 13D
CUSIP No. 90184L102
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1 |
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Names of Reporting Persons
Elon R. Musk |
2 |
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Check the Appropriate Box if a Member of a Group
(a) ¨ (b) ¨
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3 |
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SEC Use Only
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4 |
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Source of Funds (See Instructions)
OO |
5 |
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Check if disclosure of legal proceedings is required pursuant
to Items 2(d) or 2(e)
x |
6 |
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Citizenship or Place of Organization
USA |
NUMBER OF
SHARES
BENEFICIALLY
OWNED BY
EACH
REPORTING
PERSON
WITH
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7 |
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Sole Voting Power
73,115,038 |
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8 |
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Shared Voting Power
0 |
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9 |
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Sole Dispositive Power
0 |
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10 |
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Shared Dispositive Power
73,115,038 |
11 |
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Aggregate Amount Beneficially Owned by Each Reporting Person
73,115,038 |
12 |
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Check if the Aggregate Amount in Row (11) Excludes
Certain Shares
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13 |
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Percent of Class Represented by Amount in Row (11)
9.6% |
14 |
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Type of Reporting Person
IN |
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1. Based on 763,577,533 shares of Common Stock outstanding as of March
30, 2022, as reported in the Issuer’s 2022 Annual Proxy Statement on Schedule 14A filed with the Securities and Exchange Commission
on April 12, 2022.
Explanatory Note: This statement on Schedule 13D amends the Schedule
13D of Elon Musk (the “Reporting Person”) that was filed with the Securities and Exchange Commission on April 5, 2022,
as amended on April 11, 2022, April 14, 2022 and April 21, 2022 (collectively, including this amendment, the “Schedule
13D”), with respect to the Common Stock, par value $0.000005 per share (the “Common Stock”), of Twitter, Inc. (the
“Issuer” or “Twitter”). This amendment to the Schedule 13D constitutes Amendment No. 4 to the Schedule 13D.
Capitalized terms used but not defined herein have the meanings given to such terms in the Schedule 13D. Except as set forth herein, the
Schedule 13D is unmodified.
Item 3. Source and Amount of Funds or Other Consideration
Item 3 of the Schedule 13D is hereby amended by adding the following:
The information set forth in Item 4 of the Schedule 13D is incorporated
herein by reference.
Item 4. Purpose of Transaction
Item 4 of the Schedule 13D is hereby amended by adding the following:
On April 24, 2022, the Reporting Person delivered a letter to the
Chairman of the Board of Directors of the Issuer, re-iterating his interest in acquiring the Issuer at $54.20 per share (the
“April 24 Letter”).
On April 25, 2022, the Issuer issued a press release (the “Press
Release”) announcing the execution of an agreement and plan of merger (the “Merger Agreement”), made and entered into
as of April 25, 2022, by and among the Issuer, X Holdings I, Inc., an entity wholly owned by the Reporting Person (“Parent”),
X Holdings II, Inc., a direct wholly owned subsidiary of Parent (“Merger Sub”), and, solely for the purpose of certain specified
provisions, the Reporting Person. Pursuant to the terms and subject to the conditions of the Merger Agreement, (i) Merger Sub will merge
with and into the Issuer with the Issuer surviving as a wholly owned subsidiary of Parent (the “Merger”), and (ii) each share
of Common Stock (other than certain excluded shares) will be converted into the right to receive $54.20 per share, net to such Issuer
shareholder in cash, without interest and less any required withholding taxes. If the transactions contemplated by the Merger Agreement
are consummated, the Issuer will become a privately held company owned directly or indirectly by the Reporting Person and certain of his
affiliates and will no longer be listed on the New York Stock Exchange.
Additionally, on April 25, 2022, the Reporting Person entered into
a new debt commitment letter, which extended the availability of the commitments thereunder (the “April 25 Debt Commitment Letter”),
and a new margin loan commitment letter, which extended the availability of the commitments thereunder (the “April 25 Margin Loan
Commitment Letter”).
Additionally, on April 25, 2022, the Equity Commitment Letter (the
“Amended Equity Commitment Letter”) was amended to reflect a negotiated merger agreement and the addition of a limited guarantee,
pursuant to which, to induce the Issuer to enter into the Merger Agreement, the Reporting Person guaranteed to the Issuer the performance
of certain payment obligations of Parent (the “Limited Guarantee”).
The foregoing descriptions of the Press Release, April 24 Letter, the
April 25 Debt Commitment Letter, the April 25 Margin Loan Commitment Letter and the Amended Equity Commitment Letter are qualified in
their entirety by reference to the full text of the April 24 Letter, the April 25 Debt Commitment Letter, the April 25 Margin Loan Commitment
Letter and the Amended Equity Commitment Letter, copies of which are attached hereto as Exhibits F, G, H, I,
and J, respectively, and are incorporated herein by reference.
Item 5. Interest in Securities of Issuer
Item 5(a,b) of the Schedule 13D is hereby amended and restated as follows:
(a,b) For information regarding beneficial ownership, see the information
presented on the cover page of this Schedule 13D. The Common Stock beneficially owned by the Reporting Person is held by the Elon Musk
Revocable Trust dated July 22, 2003 for which Elon Musk is the sole Trustee.
Item 6. Contracts, Arrangements, Understandings or Relationships
with Respect to Securities of the Issuer
Item 6 of the Schedule 13D is hereby amended by adding the following:
The information set forth in Item 4 of the Schedule 13D is incorporated
herein by reference.
Item 7. Materials to be Filed as Exhibits
Item 7 of the Schedule 13D is hereby amended and supplemented as follows:
Exhibit
F: | |
Press
Release, dated April 25, 2022 (incorporated herein by reference to Exhibit 99.1 to the Current Report on Form 8-K filed by the Issuer
with the Securities and Exchange Commission on April 25, 2022). |
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Exhibit
G: | |
Letter,
dated April 24, 2022 |
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Exhibit
H: | |
April 25
Debt Commitment Letter, dated April 25, 2022 |
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Exhibit
I: | |
April 25
Margin Loan Commitment Letter, dated April 25, 2022 |
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Exhibit
J: | |
Amended
Equity Commitment Letter, dated April 25, 2022 |
SIGNATURES
After reasonable inquiry and to the best of each of the undersigned
knowledge and belief, each of the undersigned certifies that the information set forth in this statement is true, complete and correct.
Date: April 25, 2022
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ELON R. MUSK |
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/s/ Elon R. Musk |
EXHIBIT 99.G
EXHIBIT G
April 24, 2022
Bret Taylor
Chairman of the Board,
Thank you for the conversation yesterday.
We remain committed to our transaction with Twitter at $54.20 and appreciate
your contact on the matter. As we discussed, $54.20 has been and will remain my best and final offer, period. This is binary
– my offer will either be accepted or I will exit my position. At the time my $54.20 offer was
made, it represented a 54% premium to Twitter’s share price prior to the day before my investment in Twitter began, and a 38% premium
to the day before my investment in Twitter was announced. Since that time, the attractiveness of my proposal has only increased
given the market’s continued correction. Had your stock traded inline with comparable social media companies, my offer would
represent approximately 90% and 70% premiums to those times.
While I strongly believe that you should recommend
my offer to shareholders based upon its superior value to the value of Twitter without my offer and my equity position, I recognize that
you may elect not to do so. As such, I have attached a merger agreement that is “seller friendly” and that does not
require you to recommend in favor of my offer. This will provide all shareholders a voice, and allow for a democratic decision consistent
with Twitter’s ethos. With your cooperation, we can negotiate changes that you require to be able to announce a transaction before
the market opens tomorrow that the shareholders can then vote on. I would respect the outcome of that vote if the shareholders prefer
the management plan to my $54.20, and exit my position entirely if that is the outcome of the vote.
In order to provide further value and choice to shareholders
(within the legal boundaries of a private, unlisted company), we are willing to explore options that allow existing shareholders (including
convertible securities and other related instruments) to invest all or a portion of their proceeds into the proposed transaction. Any
such rollover transaction would be structured as a separate negotiated transaction consistent with laws and regulations and not be a public
offer, and would not affect the proposed $54.20 cash offer transaction.
My strong preference continues to be a negotiated transaction
with you at $54.20 per share.
I look forward to the board’s response to my
proposal.
/s/ Elon Musk
EXHIBIT 99.H
EXHIBIT H
Execution Version
MORGAN STANLEY SENIOR FUNDING, INC.
1585 Broadway
New York, NY 10036 |
BANK OF AMERICA, N.A.
BOFA SECURITIES, INC.
One Bryant Park
New York, NY 10036 |
BARCLAYS
745 Seventh Avenue
New York, NY 10019 |
MUFG
1221 Avenue of the Americas
New York, NY 10020 |
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BNP PARIBAS
BNP PARIBAS SECURITIES CORP.
787 Seventh Avenue
New York, NY 10019 |
MIZUHO BANK, LTD.
1271 Avenue of the Americas
New York, NY 10020 |
SOCIETE GENERALE
245 Park Avenue
New York, NY 10167 |
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CONFIDENTIAL
April 25, 2022
X Holdings I, Inc.
X Holdings II, Inc.
2110 Ranch Road
620 S. #341886,
Austin, TX 78734
Attn: Elon R. Musk
Project X
Commitment Letter
Ladies and Gentlemen:
You have advised each of Morgan
Stanley Senior Funding , Inc. (acting through such of affiliates or branches as it deems appropriate, “MSSF”),
Bank of America, N.A. (“Bank of America”), BofA Securities, Inc. (or any of its designated affiliates,
“BofA Securities”), Barclays Bank PLC (“Barclays”), MUFG Bank, Ltd. (“MUFG”),
BNP Paribas (“BNP Paribas”), BNP Paribas Securities Corp. (“BNPP Securities” and,
together with BNP Paribas, “BNPP”), Mizuho Bank, Ltd. (“Mizuho”) and Societe
Generale (“SocGen” and, together with MSSF, Bank of America, BofA Securities, Barclays, MUFG, BNPP and Mizuho,
the “Commitment Parties”, “we” or “us”) that X Holdings, II, Inc.,
a Delaware corporation (“Bidco” or “you”), and X Holdings, I, Inc., a Delaware
corporation (“Holdings” or “you”), formed at the direction of Elon R. Musk and his
affiliates (collectively, the “Investors”), intend to acquire (the “Acquisition”), directly or indirectly,
all of the outstanding equity interests of, or, directly or indirectly merge with, Twitter, Inc. (the “Company”).
You have further advised us that, in connection with the foregoing, you intend to consummate the other Transactions described in the Transaction
Description attached hereto as Exhibit A (the “Transaction Description”). Capitalized terms used but not
defined herein shall have the meanings assigned to them in the Transaction Description and in the Summaries of Principal Terms and Conditions
attached hereto as Exhibit B (the “Bank Facilities Term Sheet”), Exhibit C (the “Secured
Bridge Term Sheet”) and Exhibit D (the “Unsecured Bridge Term Sheet”; together with the Bank
Facilities Term Sheet and the Secured Bridge Term Sheet, the “Term Sheets”; this commitment letter, the Transaction
Description, the Term Sheets and the Summary of Conditions attached hereto as Exhibit E, collectively, the “Commitment
Letter”).
You have further advised us
that, in connection therewith, it is intended that the financing for the Transactions will include (i) the senior secured term loan
facility described in the Bank Facilities Term Sheet, in an aggregate principal amount of $6,500.0 million plus at the Borrower’s
election, an amount sufficient to fund any OID required to be funded due to the exercise of market flex provisions in the Fee Letter (as
defined below) (the “Term Loan Facility”), (ii) a senior secured revolving credit facility described in
the Bank Facilities Term Sheet, in an aggregate principal amount of $500 million (the “Revolving Facility” and,
together with the Term Loan Facility, the “Bank Facilities”), (iii) either (x) up to $3,000.0 million
in aggregate principal amount of senior secured notes (the “Senior Secured Notes”) in a Rule 144A private
placement or (y) if all or any portion of the Senior Secured Notes are not issued by the Borrower on or prior to the Closing Date
(as defined below), up to $3,000.0 million of senior secured increasing rate loans (the “Secured Bridge Loans”),
under the senior secured credit facility (the “Secured Bridge Facility” and, together with the Bank Facilities,
the “Senior Secured Facilities”) described in the Secured Bridge Term Sheet and (iv) either (x) up
to $3,000 million in aggregate principal amount of senior unsecured notes (the “Unsecured Notes” and, together
with the Senior Secured Notes, the “Notes”) in a Rule 144A private placement or (y) if all or any
portion of the Unsecured Notes are not issued by the Borrower on or prior to the Closing Date, up to $3,000 million of senior unsecured
increasing rate loans (the “Unsecured Bridge Loans” and, together with the Secured Bridge Loans, the “Bridge
Loans”), under the senior unsecured credit facility (the “Unsecured Bridge Facility”) described
in the Unsecured Bridge Term Sheet. The Bank Facilities, Secured Bridge Facility and the Unsecured Bridge Facility are collectively referred
to herein as the “Facilities”.
1. Commitments.
In connection with the foregoing,
(a) each of MSSF, Bank of America, Barclays, MUFG, BNP Paribas, Mizuho and SocGen, respectively, is pleased to advise you of its
several and not joint commitment to, and hereby agrees to, provide 26.9231%, 20.7692%, 20.7692%, 20.7692%, 5%, 3.6539% and 2.1154%, respectively,
of the Term Loan Facility, (b) each of MSSF, Bank of America, Barclays, MUFG, BNP Paribas, Mizuho and SocGen, respectively, is pleased
to advise you of its several and not joint commitment to, and hereby agrees to, provide 26.9231%, 20.7692%, 20.7692%, 20.7692%, 5%, 3.6539%
and 2.1154%, respectively, of the Revolving Facility, (c) each of MSSF, Bank of America, Barclays, MUFG, BNP Paribas, Mizuho and
SocGen, respectively, is pleased to advise you of its several and not joint commitment to, and hereby agrees to, provide 26.9231%, 20.7692%,
20.7692%, 20.7692%, 5%, 3.6539% and 2.1154%, respectively, of the Secured Bridge Facility and (d) each of MSSF, Bank of America,
Barclays, MUFG, BNP Paribas, Mizuho and SocGen, respectively, is pleased to advise you of its several and not joint commitment to, and
hereby agrees to, provide 26.9231%, 20.7692%, 20.7692%, 20.7692%, 5%, 3.6539% and 2.1154%, respectively, of the Unsecured Bridge Facility,
in each case subject only to the satisfaction (or waiver in writing by the Commitment Parties) of the applicable conditions set forth
in Exhibit E hereto. MSSF, Bank of America, Barclays, MUFG, BNP Paribas, Mizuho and SocGen are referred to herein as the “Initial
Lenders” and each individually as an “Initial Lender”, with the entities named in clause (a) above
being herein called the “Initial Term Lenders”, with the entities named in clause (b) above being herein
called the “Initial Revolving Lenders” (and, together with the Initial Term Lenders, the “Initial
Bank Lenders”), with the entities named in clause (c) above being herein called the “Initial Secured Bridge
Lenders” and with the entities named in clause (d) above being herein called the “Initial Unsecured Bridge
Lenders”.
2. Titles
and Roles.
It is agreed that (i) each
of MSSF, BofA Securities, Barclays, MUFG, BNPP Securities, Mizuho and SocGen will act as a lead arranger and joint bookrunner for the
Term Loan Facility and the Revolving Facility (in such capacity, a “Bank Lead Arranger” and collectively, the
“Bank Lead Arrangers”), (ii) each of MSSF, BofA Securities, Barclays, MUFG, BNPP Securities, Mizuho and
SocGen will act as a lead arranger and joint bookrunner for the Secured Bridge Facility (in such capacity, an “Secured Bridge
Lead Arranger” and collectively, the “Secured Bridge Lead Arrangers”), (iii) each of MSSF,
BofA Securities, Barclays, MUFG, BNPP Securities, Mizuho and SocGen will act as a lead arranger and joint bookrunner for the Unsecured
Bridge Facility (each in such capacity, a “Unsecured Bridge Lead Arranger” and collectively, the “Unsecured
Bridge Lead Arrangers” and, together with the Bank Lead Arrangers and the Secured Bridge Lead Arrangers, the “Lead
Arrangers”), (iv) MSSF will act as joint physical bookrunner for the Bank Facilities, (v) MSSF will act as administrative
agent and collateral agent for the Term Loan Facility and the Revolving Facility (in such capacity, the “Bank Administrative
Agent”), (vi) MSSF will act as administrative agent and collateral agent for the Secured Bridge Facility (in such capacity,
the “Secured Bridge Administrative Agent”) and (vii) MSSF will act as administrative agent for the Unsecured
Bridge Facility (in such capacity, the “Unsecured Bridge Administrative Agent” and, together with the Bank Administrative
Agent and the Secured Bridge Administrative Agent, the “Administrative Agents”). It is further agreed that (i) MSSF,
shall have “left” placement in any and all marketing materials or other documentation used in connection with the Bank Facilities,
(ii) MSSF shall have “left” placement in any and all marketing materials or other documentation used in connection with
the Secured Bridge Facility and (iii) MSSF shall have “left” placement in any and all marketing materials or other documentation
used in connection with the Unsecured Bridge Facility.
Except as set forth in the
immediately preceding paragraph, no other titles will be awarded and no compensation (other than that expressly contemplated by this Commitment
Letter and the Fee Letter referred to below) will be paid to any Lender in order to obtain its commitment to participate in the Facilities
unless you and the Commitment Parties shall so agree. The respective commitments of the Initial Lenders shall be several and not joint.
3. Syndication.
The applicable Lead Arrangers
reserve the right, prior to or after the execution of the applicable Facilities Documentation (as defined in Exhibit E) to syndicate
all or a portion of the Initial Lenders’ respective commitments hereunder to a group of banks, financial institutions and other
institutional lenders identified by the Lead Arrangers in consultation with you and reasonably acceptable to them and you with respect
to the identity of such lenders (your consent not to be unreasonably withheld or delayed) including, without limitation, any relationship
lenders designated by you and reasonably acceptable to the Lead Arrangers (such banks, financial institutions and other institutional
lenders, together with the Initial Lenders, the “Lenders”); provided that, notwithstanding each Lead
Arranger’s right to syndicate the Facilities and receive commitments with respect thereto, it is agreed that (i) syndication
of, or receipt of commitments or participations in respect of, all or any portion of an Initial Lender’s commitments hereunder prior
to the date of the consummation of the Acquisition and the date of the initial funding under the Facilities (the date of such funding,
the “Closing Date”) shall not be a condition to such Initial Lender’s commitments or the funding of the
Facilities on the Closing Date; (ii) no Initial Lender shall be relieved, released or novated from its obligations hereunder (including
its obligation to fund the Facilities on the Closing Date) in connection with any syndication, assignment or participation of the Facilities,
including its commitments in respect thereof, until after the initial funding of the Facilities has occurred; (iii) no assignment
or novation (except as contemplated in the immediately preceding clause (ii)) shall become effective with respect to all or any portion
of any Initial Lender’s commitments in respect of the Facilities until after the initial funding of the Facilities; (iv) unless
you otherwise agree in writing, each Commitment Party shall retain exclusive control over all rights and obligations with respect to its
commitments in respect of the Facilities, including all rights with respect to consents, modifications, supplements, waivers and amendments,
until the Closing Date has occurred; and (v) we will not syndicate our commitments to certain banks, financial institutions and other
institutional lenders and investors (a) that have been separately identified by name in writing by you or the Investors to us prior
to the date hereof (or, if after such date and prior to the launch of general syndication, that are reasonably acceptable to the Lead
Arrangers holding (or their affiliates holding) a majority of the aggregate amount of outstanding financing commitments in respect of
the Facilities on the date hereof (the “Majority Lead Arrangers”)), (b) those persons who are competitors
of the Company and its subsidiaries that are separately identified by name in writing by you or the Investors to us from time to time,
and (c) in the case of each of clauses (a) and (b) above, any of their affiliates (other than bona fide debt fund affiliates)
that are either (x) identified by name in writing by you or the Investors from time to time or (y) clearly identifiable on the
basis of such affiliate’s name (clauses (a), (b) and (c) above, collectively “Disqualified Lenders”);
provided that designations of Disqualified Lenders may not apply retroactively to disqualify any entity that has previously acquired
an assignment or participation in any Facility.
Without limiting your obligations
to assist with syndication efforts as set forth herein, it is understood that the Initial Lenders’ commitments hereunder are not
conditioned upon the syndication of, or receipt of commitments or participations in respect of, the Facilities and in no event shall the
commencement or successful completion of syndication of the Facilities constitute a condition to the availability of the Facilities on
the Closing Date. The Lead Arrangers intend to commence syndication efforts promptly upon the execution by each party of this Commitment
Letter and as part of their syndication efforts, it is their intent to have Lenders commit to the Facilities prior to the Closing Date
(subject to the limitations set forth in the preceding paragraph). You agree actively to assist the Lead Arrangers, until the earlier
to occur of (i) a Successful Syndication (as defined in the Fee Letter) and (ii) 30 days after the Closing Date (such earlier
date, the “Syndication Date”), in completing a timely syndication that is reasonably satisfactory to them and
you. Such assistance shall include, without limitation, (a) your using commercially reasonable efforts to ensure that any syndication
efforts benefit materially from your existing lending and investment banking relationships of the Investors (and, to the extent the Acquisition
is consummated pursuant to a Merger Transaction (as defined below) and in any event, after the Closing Date, the existing lending and
investment banking relationships and the existing lending and investment banking relationships of the Company), (b) direct contact
between senior management, representatives and advisors of you and the Investors, on the one hand, and the proposed Lenders, on the other
hand (and, to the extent the Acquisition is consummated pursuant to a Merger Transaction and in any event, after the Closing Date, your
using commercially reasonable efforts to ensure such contact between senior management, representatives and advisors of the Company, on
the one hand, and the proposed Lenders, on the other hand, to the extent not in contravention of the Acquisition Agreement), in all such
cases at times and places mutually agreed upon (which meeting may, if mutually agreed, be virtual), (c) your and the Investors’
assistance, and (to the extent the Acquisition is consummated pursuant to a Merger Transaction and in any event, after the Closing Date)
your using commercially reasonable efforts to cause the Company to assist in the preparation of customary confidential information memoranda
for the Facilities (any such memorandum, a “Confidential Information Memorandum”) and other marketing materials
to be used in connection with the syndications (including a customary lender presentation, in each case, by using commercially reasonable
efforts to provide information and other customary materials reasonably requested in connection with such Confidential Information Memorandum
no less than 15 business days prior to the Closing Date), in each case to the extent not in contravention of the Acquisition Agreement,
(d) to the extent requested by the Lead Arrangers, using your commercially reasonable efforts to procure a public corporate credit
rating and a public corporate family rating in respect of the Borrower from each of Standard & Poor’s Ratings Services
(“S&P”) and Moody’s Investors Service, Inc. (“Moody’s”), respectively,
and public ratings for each of the Facilities and the Notes from each of S&P and Moody’s, in each case, prior to the launch
of general syndication, (e) the hosting, with the Lead Arrangers, of no more than two meetings of prospective Lenders at times and
locations to be mutually agreed upon with the Principal attending and participating in at least one of the aforesaid meetings (which meeting
shall not exceed two (2) hours in duration and may be virtual) and (f) your ensuring (and to the extent the Acquisition is consummated
pursuant to a Merger Transaction and in any event, after the Closing Date, with respect to the Company and its subsidiaries your using
commercially reasonable efforts to ensure, to the extent not in contravention of the Acquisition Agreement) that there shall be no competing
issues of debt securities or commercial bank or other credit facilities (other than the Facilities) of you, Holdings, the Borrower, the
Company or any of their respective subsidiaries being offered, placed or arranged (other than the Notes (or the issuance of any “demand
securities” issued in lieu of the Notes or other indebtedness issued in lieu of the Notes that has otherwise been consented to by
the Majority Lead Arrangers (such consent not to be unreasonably withheld or delayed) or any debt disclosed to us on or prior to the date
hereof) if such debt securities or commercial bank or other credit facilities would, in the reasonable judgment of the Lead Arrangers,
materially impair the primary syndication of the Facilities without the prior consent of the Lead Arrangers (such consent not to be unreasonably
withheld or delayed) (it is understood and agreed that any deferred purchase price obligations, ordinary course working capital and revolving
facilities and ordinary course capital lease, purchase money and equipment financings will not be deemed to materially impair the primary
syndication of the Facilities (and any refinancing, replacement, extension or renewal of existing debt of the Company or any amendment
to any of the foregoing)). Notwithstanding anything to the contrary contained in this Commitment Letter or the Fee Letter or any other
letter agreement or undertaking concerning the financing of the Transactions to the contrary, neither the obtaining of the ratings referenced
above nor the compliance with any of the other provisions set forth in clauses (a) through (f) above or any other provision
of this paragraph shall constitute a condition to the commitments hereunder or the funding of the Facilities on the Closing Date or at
any time thereafter and the only financial statements required to be delivered as a condition to the commitments hereunder shall be those
set forth in paragraph 6 of Exhibit E.
The Lead Arrangers, in their
capacities as such, will, in consultation with you, manage all aspects of any syndication of the Facilities, including decisions as to
the selection of institutions reasonably acceptable to you to be approached and when they will be approached, when their commitments will
be accepted, which institutions will participate (subject to your consent rights and rights of appointment set forth in the second preceding
paragraph), the allocation of the commitments among the Lenders and the amount and distribution of fees among the Lenders from the amounts
to be paid to the Commitment Parties pursuant to this Commitment Letter and the Fee Letter. To assist the Lead Arrangers in their syndication
efforts, you agree promptly to prepare and provide (and to use commercially reasonable efforts to cause the Investors to provide, and,
to the extent the Acquisition is consummated pursuant to a Merger Transaction and in any event, after the Closing Date, to use commercially
reasonable efforts to cause the Company to provide) to the Lead Arrangers all customary information with respect to you and the Company
and each of your and its respective subsidiaries and the Transactions, including all financial information and projections (such projections,
including financial estimates, budgets, forecasts and other forward-looking information, the “Projections”),
as the Lead Arrangers may reasonably request in connection with the structuring, arrangement and syndication of the Facilities; it being
understood that such information regarding the Company and its subsidiaries shall be limited to publicly filed information to the extent
the Acquisition is consummated pursuant to a Tender Offer. For the avoidance of doubt, you will not be required to provide any information
to the extent that the provision thereof would violate any law, rule or regulation binding upon you or any of your subsidiaries or
affiliates or upon the Company or any of its respective subsidiaries or affiliates or any obligation of confidentiality binding upon,
or waive any attorney-client privilege of, you, the Company or your or its respective subsidiaries and affiliates (in which case you agree
to use commercially reasonable efforts to have any such confidentiality obligation waived, and otherwise in all instances, to the extent
practicable and not prohibited by applicable law, rule or regulation, promptly notify us that information is being withheld pursuant
to this sentence). Notwithstanding anything herein to the contrary, the only financial statements that shall be required to be provided
to the Commitment Parties in connection with the syndication of the Facilities shall be those required to be delivered pursuant to paragraph
6 of Exhibit E.
You shall use commercially
reasonable efforts with respect to the Bridge Facilities, (a) to provide that each Investment Bank (as defined in Exhibit E)
receives (i) a customary preliminary offering memorandum containing (A) all customary information, including financial statements
(other than pro forma financial statements which are described below), business and other financial data of the type and form that are
customarily included in private placements pursuant to Rule 144A promulgated under the Securities Act (including information required
by Regulation S-X and Regulation S-K under the Securities Act, which is understood not to include (I) a “description of notes,”
“plan of distribution” and information customarily provided by the Investment Banks or their counsel or advisors in the preparation
of an offering memorandum for an offering of high yield unsecured debt securities in a private placement under Rule 144A of the Securities
Act, including any risk factors relating to, or any description of, all or any component of the financing contemplated thereby or by this
Commitment Letter, (II) segment reporting or consolidating financial statements, separate subsidiary financial statements and other
financial statements and data that would be required by Sections 3-05, 3-09, 3-10, 3-16, 13-01 and 13-02 of Regulation S-X, (III) management’s
CD&A and other information required by Item 402 of Regulation S-K and information regarding executive compensation and related party
disclosure related to SEC Release Nos. 33-8732A, 34-54302A and IC-27444A, and (IV) other customary exceptions) and (B) pro forma
financial statements of the type and form that are customarily included in private placements pursuant to Rule 144A promulgated under
the Securities Act to be prepared in a manner consistent with Regulation S-X (and in the case of pro forma financial statements for the
twelve-month period ending on the last day of the most recently completed four-fiscal quarter period presented, as if Regulation S-X was
applicable to such financial statements) and (ii) all other financial data that would be reasonably necessary for the Investment
Banks to receive customary “comfort” letters from the independent accountants of the Company in connection with the offering
of the Notes (and the Borrower shall have made all commercially reasonable efforts to cause such accountants to provide the Investment
Banks with drafts of such “comfort” letters (which shall provide customary “negative assurance” comfort), which
such accountants would be prepared to issue upon completion of customary procedures) and (b) to afford the Investment Banks a period
(the “Notes Marketing Period”) of at least 15 consecutive business days upon receipt of the information described
above in clause (a)(i) (the “Notes Required Information”) to seek to place the Notes with qualified purchasers
thereof; provided that (i) July 4 and 5, 2022 shall not constitute business days for purposes of the Notes Marketing Period
and (ii) if the Notes Marketing Period has not ended by August 19, 2022 then the Notes Marketing Period shall not begin before
September 6, 2022. If the Borrower shall in good faith reasonably believe that the Notes Required Information has been delivered
to the Lead Arrangers, the Borrower may deliver to the Lead Arrangers a written notice to that effect (stating when it believes the delivery
of the Notes Required Information to the Lead Arrangers was completed), in which case the Borrower shall be deemed to have complied with
such obligation to furnish the Notes Required Information and the Lead Arrangers shall be deemed to have received the Notes Required Information,
unless the Lead Arrangers in good faith reasonably believe that the Borrower has not completed delivery of the Notes Required Information
and not later than 5:00 p.m. (New York City time) two (2) business days after the delivery of such notice by the Borrower, delivers
a written notice to the Borrower to that effect (stating with specificity which such Notes Required Information the Borrower has not delivered);
provided that notwithstanding the foregoing, the delivery of the Notes Required Information shall be satisfied at any time at which (and
so long as) the Lead Arrangers shall have actually received the Notes Required Information. Notwithstanding anything to the contrary contained
in this Commitment Letter or the Fee Letter or any other letter agreement or undertaking concerning the financing of the Transactions
to the contrary, neither the occurrence of the Notes Marketing Period referred to above or any other provision of this paragraph shall
constitute a condition to the commitments hereunder or the funding of the Facilities on the Closing Date or at any time thereafter and
the only financial statements required to be delivered as a condition to the commitments hereunder shall be those set forth in paragraph
6 of Exhibit E.
4. Information.
You hereby represent and warrant
that (a) all written information and written data (such information and data, other than (i) the Projections and (ii) information
of a general economic or industry specific nature, the “Information”) (in the case of Information regarding
the Company and its subsidiaries and its and their respective businesses, to your knowledge) that has been or will be made available to
the Commitment Parties by or on behalf of you or any of your representatives, taken as a whole, is or will be, when furnished, correct
in all material respects and does not or will not, when furnished, and when taken as a whole and together with the Company’s public
filings with the Securities and Exchange Commission (other than any portions thereof under the “risk factors” section or other
cautionary language), contain any untrue statement of a material fact or omit to state a material fact necessary in order to make the
statements contained therein not materially misleading in light of the circumstances under which such statements are made (after giving
effect to all supplements and updates thereto from time to time) and (b) the Projections that have been or will be made available
to the Commitment Parties by or on behalf of you or any of your representatives have been or will be, at the time furnished, prepared
in good faith based upon assumptions that you believe to be reasonable at the time made and at the time the related Projections are so
furnished to the Commitment Parties, it being understood that the Projections are predictions as to future events and are not to be viewed
as facts, that the Projections are subject to significant uncertainties and contingencies, many of which are beyond your control, that
no assurance can be given that any particular Projections will be realized and that actual results during the period or periods covered
by any such Projections may differ significantly from the projected results and such differences may be material. You agree that if, at
any time prior to the later of the Closing Date and the Syndication Date, you become aware that any of the representations and warranties
in the preceding sentence would be incorrect in any material respect if the Information and Projections were being furnished, and such
representations and warranties were being made, at such time, then you will (or, with respect to the Information and Projections relating
to the Company and its subsidiaries, will use commercially reasonable efforts to) promptly supplement the Information and the Projections
so that such representations and warranties will be correct in all material respects under those circumstances. Notwithstanding anything
to the contrary herein, the accuracy of the foregoing representations shall not be a condition to the Commitment Parties’ obligations
hereunder or the funding of the Facilities on the Closing Date. In arranging and syndicating the Facilities, the Commitment Parties will
be entitled to use and rely primarily on the Information and the Projections without responsibility for independent verification of the
veracity or completeness thereof.
You hereby acknowledge that
(a) the Lead Arrangers will make available Information and Projections to the proposed syndicate of Lenders by posting such Information
and Projections on IntraLinks, SyndTrak Online or similar electronic means and (b) certain of the Lenders may be “public side”
Lenders (i.e., Lenders that wish to receive only information that (i) is publicly available, (ii) is not material with respect
to you, Holdings, the Borrower, the Company, your or its respective subsidiaries or the respective securities of any of the foregoing
for purposes of United States federal and state securities laws or (iii) constitutes information of a type that would be publicly
available if you, Holdings, the Borrower, the Company or your or their respective subsidiaries, were public reporting companies (as reasonably
determined by you) (collectively, the “Public Side Information”; any information that is not Public Side Information,
“Private Side Information”)) and who may be engaged in investment and other market-related activities with respect
to you, Holdings, the Borrower, the Company, any of your or its respective subsidiaries or the respective securities of any of the foregoing
(each, a “Public Sider” and each Lender that is not a Public Sider, a “Private Sider”).
If reasonably requested by
the Lead Arrangers you will use commercially reasonable efforts to assist us in preparing a customary additional version of the Confidential
Information Memorandum to be used in connection with the syndication of the Facilities that includes only Public Side Information with
respect to you, Holdings, the Borrower, the Company, your or their respective subsidiaries or the respective securities of any of the
foregoing to be used by Public Siders. The Public Side Information will be substantially consistent with the information that would be
included in any offering memorandum for the Notes (including customary “risk factors”) and in any filings that would be required
to be made by you, the Company, or any of your or its respective subsidiaries with the Securities and Exchange Commission if you, the
Company or any of your or its respective subsidiaries were public reporting companies. It is understood that in connection with your assistance
described above, customary authorization letters will be included in any Confidential Information Memorandum that authorize the distribution
of the Confidential Information Memorandum to prospective Lenders that contain the representations set forth in the second preceding paragraph
(and represent that the additional version of the Confidential Information Memorandum contains only Public Side Information with respect
to you, Holdings, the Borrower, the Company your or its respective subsidiaries and the respective securities of any of the foregoing
(other than as set forth in the following paragraph)) and that the Confidential Information Memorandum shall exculpate you, the Investors,
the Company and your and their respective subsidiaries and affiliates and us and our affiliates with respect to any liability related
to the use or misuse of the contents of the Confidential Information Memorandum or any related marketing material by the recipients thereof;
provided that (x) the Company shall be required to deliver authorization letters only to the extent the Acquisition is to
be consummated pursuant to a Merger Transaction at the time such authorization letters are to be delivered and in any event, after the
Closing Date, and to the extent not in contravention of the Acquisition Agreement and (y) any representations as to the Company in
the case of authorization letters to be delivered by the Company shall not be qualified by knowledge.
You agree to use commercially
reasonable efforts to identify that portion of the Information that may be distributed to the Public Siders as “PUBLIC”. You
agree that, subject to the confidentiality and other provisions of this Commitment Letter, the Lead Arrangers on your behalf may distribute
the following documents to all prospective lenders in the form provided to you and to your counsel a reasonable time prior to their distribution,
unless you or your counsel advise the Lead Arrangers in writing (including by email) within a reasonable time prior to their intended
distribution that such material should only be distributed to Private Siders: (a) the Term Sheets, (b) interim and final drafts
of the Facilities Documentation, (c) administrative materials prepared by the Lead Arrangers for prospective Lenders (such as a lender
meeting invitation, allocations and funding and closing memoranda) and (d) changes in the terms of the Facilities. If you advise
us that any of the foregoing items should be distributed only to Private Siders, then the Lead Arrangers will not distribute such materials
to Public Siders without your consent.
5. Fees.
As consideration for the commitments
of the Initial Lenders hereunder and for the agreement of the Lead Arrangers to perform the services described herein, you agree to pay
(or cause to be paid) the fees set forth in the Term Sheets and in the Fee Letter dated the date hereof and delivered herewith with respect
to the Facilities (the “Fee Letter”), if and to the extent payable. Once paid, such fees shall not be refundable
under any circumstances, except as otherwise contemplated by the Fee Letter.
6. Conditions
Precedent.
The several commitments of
the Initial Lenders hereunder to fund the Facilities on the Closing Date and the several agreements of the Lead Arrangers to perform the
services described herein are subject solely to the applicable conditions set forth in Exhibit E hereto, and upon satisfaction (or
waiver in writing by the Commitment Parties) of such conditions, the initial funding of the Facilities shall occur, it being understood
that there are no conditions (implied or otherwise) to the commitments hereunder and there will be no conditions (implied or otherwise)
under the Facilities Documentation to the funding of the Facilities on the Closing Date, including compliance with the terms of this Commitment
Letter, the Fee Letter or the Facilities Documentation, other than those that are expressly stated in Exhibit E hereto.
Notwithstanding anything to the contrary in this
Commitment Letter (including each of the exhibits attached hereto), the Fee Letter, the Facilities Documentation or any other letter agreement
or other undertaking concerning the financing of the Transactions to the contrary, (i) the only representations and warranties the
making of which shall be a condition to the availability of the Facilities on the Closing Date shall be (A) solely to the extent
the Acquisition is consummated pursuant to a Merger Transaction, such of the representations and warranties made by the Company with respect
to the Company, its subsidiaries and their respective businesses in the Acquisition Agreement as are material to the interests of the
Initial Lenders, but only to the extent that you (or one of your affiliates) have the right (taking into account any applicable cure provisions)
to terminate your (or its) obligations under the Acquisition Agreement (as defined in Exhibit E) (or otherwise decline to consummate
the Acquisition without any liability) as a result of a breach of such representations and warranties in the Acquisition Agreement (to
such extent, the “Company Representations”) and (B) the Specified Representations (as defined below) and
(ii) the terms of the Facilities Documentation shall be in a form such that they do not impair the availability of the Facilities
on the Closing Date if the applicable conditions set forth in Exhibit E hereto are satisfied (or waived by the Commitment Parties)
(it being understood and agreed that, to the extent any security interest in any Collateral (as defined in Exhibit B) is not or cannot
be provided and/or perfected on the Closing Date (other than pledge and perfection of the security interests (1) in the certificated
equity securities, if any, of the Borrower and any material wholly-owned U.S. domestic subsidiaries of the Borrower (to the extent required
by the Term Sheets (provided that such certificated equity securities, will be required to be delivered on the Closing Date only to the
extent the Acquisition is consummated pursuant to a Merger Transaction and received from the Company after your use of commercially reasonable
efforts to do so)) and (2)(a) in the case of Holdings and the Borrower, in other assets with respect to which a lien may be perfected
by the filing of a financing statement under the Uniform Commercial Code and (b) solely to the extent the Acquisition is consummated
pursuant to a Merger Transaction, in the case of the Company and the other Guarantors, in other assets with respect to which a lien may
be perfected by the filing of a financing statement under the Uniform Commercial Code) after your use of commercially reasonable efforts
to do so or without undue burden or expense, then the provision and/or perfection of a security interest in such Collateral shall not
constitute a condition precedent to the availability and funding of the applicable Facilities on the Closing Date but instead shall be
required to be delivered and/or perfected after the Closing Date pursuant to arrangements and timing to be mutually agreed (but, in any
event, not later than (x) to the extent the Acquisition is consummated pursuant to a Tender Offer (as defined below), in the case
of assets of the Company and the other Guarantors with respect to which a lien may be perfected by the filing of a financing statement
under the Uniform Commercial Code, five (5) business days after the Closing Date and (y) otherwise 90 days after the Closing
Date or such longer period as may be agreed by the Bank Administrative Agent, in its sole discretion, and the Borrower acting reasonably
without any requirement for Lender consent. Notwithstanding anything to the contrary contained herein, to the extent the Acquisition is
consummated pursuant to a Tender Offer, the Company and the other Guarantors shall not be required to become a Guarantor or grant a lien
in any of their assets until five (5) business days after the Closing Date (or such longer period as may be agreed by the Bank Administrative
Agent, in its sole discretion without any requirement for Lender consent); provided that, for the avoidance of doubt, the Borrower shall,
on the Closing Date, pledge the shares of the Company acquired on the Closing Date. For purposes hereof, “Specified Representations”
means the representations and warranties made by Holdings and the Borrower (and, to the extent the Acquisition is consummated pursuant
to a Merger Transaction, the other Guarantors) to be set forth in the Facilities Documentation relating to the corporate or other organizational
existence of Holdings and the Borrower (and, if applicable, the other Guarantors) power and authority, due authorization, execution, delivery
and enforceability, in each case related to the borrowing under, guaranteeing under, granting of security interests in the Collateral
to, entry into and performance of, the Facilities Documentation; the incurrence of the loans and the provision of the Guarantees, in each
case under the Facilities, and the granting of the security interests in the Collateral to secure the Senior Secured Facilities, not conflicting
with Holdings’ and the Borrower’s (and, if applicable, the other Guarantors’) constitutional documents (after giving
effect to the Acquisition); solvency as of the Closing Date (after giving effect to the Transactions) of the Borrower and its restricted
subsidiaries on a consolidated basis (solvency to be defined in a manner consistent with the manner in which solvency is defined in the
solvency certificate to be delivered pursuant to paragraph 11 of Exhibit E); creation, validity and perfection of security interests
in the Collateral to be perfected on the Closing Date (subject to permitted liens and the foregoing provisions of this paragraph relating
to Collateral); Federal Reserve margin regulations; the use of loan proceeds not violating OFAC or the FCPA, and other anti-terrorism,
anti-bribery, anti-corruption and anti-money laundering laws; the PATRIOT Act; and the Investment Company Act. This paragraph, and the
provisions herein, shall be referred to as the “Funding Conditions Provisions”. Without limiting the conditions
precedent provided herein to funding the consummation of the Acquisition with the proceeds of the Facilities, the Lead Arrangers will
cooperate with you as reasonably requested in coordinating the timing and procedures for the funding of the Facilities in a manner consistent
with the Tender Offer Documents and/or the Acquisition Agreement, as applicable.
7. Indemnification;
Expenses.
You agree (a) to indemnify
and hold harmless each of the Commitment Parties, their respective affiliates and the respective officers, directors, employees, agents,
advisors, controlling persons, members and the successors and permitted assigns (other than Lenders that are not Initial Lenders) of each
of the foregoing (each an “Indemnified Person”) from and against any and all reasonable and documented out-of-pocket
expenses, losses, claims, damages and liabilities of any kind or nature, joint or several, to which any such Indemnified Person may become
subject, to the extent arising out of or in connection with any claim, litigation, investigation or proceeding, actual or threatened,
relating to this Commitment Letter (including the Term Sheets), the Fee Letter, the Transactions, the Facilities or any related transaction
contemplated hereby (any of the foregoing, a “Proceeding”), regardless of whether any such Indemnified Person
is a party thereto and whether such Proceeding is brought by you, your affiliates, equity holders, security holders, creditors or any
other person and whether or not the Transactions are consummated, and to reimburse each such Indemnified Person upon written demand (with
reasonable supporting detail if you shall so request in writing) for any reasonable and documented out-of-pocket legal fees and expenses
incurred in connection with investigating or defending any of the foregoing by one firm of counsel for all Indemnified Persons, taken
as a whole, and, if necessary, by a single firm of local counsel in each appropriate jurisdiction for all such Indemnified Persons, taken
as a whole (and, in the case of an actual or perceived conflict of interest where the Indemnified Person affected by such conflict notifies
you of the existence of such conflict and thereafter, after receipt of your written consent (which consent shall not be unreasonably withheld
or delayed), retains its own counsel, by another firm of counsel for such affected Indemnified Person); provided that the foregoing
indemnity will not, as to any Indemnified Person, apply to out-of-pocket expenses, losses, claims, damages, liabilities or related expenses
to the extent that they have resulted from (i) the willful misconduct, bad faith, gross negligence or material breach of this Commitment
Letter of such Indemnified Person or any of such Indemnified Person’s affiliates or any of its or their respective officers, directors,
employees, agents, controlling persons, members, advisors or the successors and permitted assigns (other than Lenders that are not Initial
Lenders) of any of the foregoing (as determined by a court of competent jurisdiction in a final and non-appealable decision) or (ii) in
the case of a Proceeding initiated by you or one of your permitted assignees against the relevant Indemnified Person, a material breach
of the obligations of such Indemnified Person or any of such Indemnified Person’s affiliates or of any of its or their respective
officers, directors, employees, agents, advisors or their representatives of any of the foregoing under this Commitment Letter, the Fee
Letter or the Facilities Documentation (as determined by a court of competent jurisdiction in a final and non-appealable decision) or
(iii) any Proceeding not arising from any act or omission by you or any of your affiliates that is brought by an Indemnified Person
against any other Indemnified Person (other than disputes involving claims against any Lead Arranger or Administrative Agent in its capacity
as such), and (b) to reimburse each Commitment Party and each Indemnified Person from time to time, upon presentation of a summary
statement (with reasonable supporting detail if you shall so request in writing), for all reasonable and documented out-of-pocket expenses
(including but not limited to expenses of each Commitment Party’s due diligence investigation, consultants’ fees (to the extent
any such consultant has been retained with your prior written consent (such consent not to be unreasonably withheld or delayed)), syndication
expenses, travel expenses and reasonable fees, disbursements and other charges of one counsel to all Lead Arrangers and, if necessary,
of a single firm of local counsel to all Lead Arrangers in each appropriate jurisdiction (other than any allocated costs of in-house counsel)
or otherwise retained with your consent (such consent not to be unreasonably withheld or delayed)), in each case incurred in connection
with the Facilities and the preparation of this Commitment Letter, the Fee Letter, the Facilities Documentation and any security arrangements
in connection therewith (collectively, the “Expenses”); provided that, except as set forth in the Fee
Letter, you shall not be required to reimburse any of the Expenses in the event the Closing Date does not occur.
Notwithstanding any other
provision of this Commitment Letter, (i) no Protected Person (as defined below) shall be liable for any damages arising from the
use by others of information or other materials obtained through internet, electronic, telecommunications or other information transmission
systems (including IntraLinks or SyndTrak Online), except to the extent that such damages have resulted from the willful misconduct, bad
faith, gross negligence or material breach of this Commitment Letter of such Protected Person or any of such Protected Person’s
affiliates or any of its or their officers, directors, employees, agents, advisors, controlling persons, members or the successors and
permitted assigns (other than Lenders that are not Initial Lenders) of any of the foregoing (as determined by a court of competent jurisdiction
in a final and non-appealable decision) and (ii) none of we, you, the Company, the Investors (or any of their respective affiliates),
any subsidiaries of the foregoing or any of their respective affiliates or the respective officers, directors, employees, agents, advisors,
controlling persons, members and the successors and permitted assigns (other than Lenders that are not Initial Lenders) of any of the
foregoing (each, a “Protected Person”) shall be liable for any indirect, special, punitive or consequential
damages (including, without limitation, any loss of profits, business or anticipated savings) in connection with this Commitment Letter,
the Fee Letter, the Transactions (including the Facilities and the use of proceeds thereunder), or with respect to any activities related
to the Facilities, including the preparation of this Commitment Letter, the Fee Letter and the Facilities Documentation; provided that
nothing in this paragraph shall limit your indemnity and reimbursement obligations to the extent that such indirect, special, punitive
or consequential damages are included in any claim by a third party unaffiliated with any of the Commitment Parties with respect to which
the applicable Protected Person is entitled to indemnification under the preceding paragraph.
You shall not be liable for
any settlement of any Proceeding effected without your written consent (which consent shall not be unreasonably withheld or delayed),
but if settled with your written consent or if there is a final and non-appealable judgment by a court of competent jurisdiction in any
such Proceeding, you agree to indemnify and hold harmless each Indemnified Person from and against any and all out-of-pocket expenses,
losses, claims, damages, liabilities and reasonable and documented legal or other out-of-pocket expenses by reason of such settlement
or judgment in accordance with and to the extent provided in the other provisions herein.
You shall not, without the
prior written consent of any Indemnified Person affected thereby (which consent shall not be unreasonably withheld or delayed) (it being
understood that the withholding of consent due to non-satisfaction of any conditions described in clauses (i) and (ii) of this
sentence shall be deemed reasonable), effect any settlement of any pending or threatened proceedings in respect of which indemnity could
have been sought hereunder by such Indemnified Person unless such settlement (i) includes an unconditional release of such Indemnified
Person in form and substance reasonably satisfactory to such Indemnified Person from all liability or claims that are the subject matter
of such proceedings and (ii) does not include any statement as to or any admission of fault, culpability or a failure to act by or
on behalf of any Indemnified Person.
8. Sharing
Information; Absence of Fiduciary Relationship; Affiliate Activities.
You acknowledge that the Commitment
Parties and their affiliates may be providing debt financing, equity capital or other services (including financial advisory services)
to other persons in respect of which you may have conflicting interests regarding the transactions described herein and otherwise. Neither
the Commitment Parties nor any of their affiliates will use confidential information obtained from you or the Company by virtue of the
transactions contemplated by this Commitment Letter or their other relationships with you in connection with the performance by them of
services for other persons, and neither the Commitment Parties nor any of their affiliates will furnish any such information to other
persons. You also acknowledge that neither the Commitment Parties nor any of their affiliates have any obligation to use in connection
with the transactions contemplated by this Commitment Letter, or to furnish to you, confidential information obtained by them from other
persons.
Each of the parties hereto
further acknowledges that MSSF or one of its affiliates has been retained as a financial advisor (in such capacity, the “Financial
Advisor”) in connection with the Acquisition. The parties hereto agree not to assert any claim that could be alleged based
on any actual or potential conflicts of interest that might be asserted to arise or result from, on the one hand, the engagement of the
Financial Advisor and, on the other hand, the relationship of the Financial Advisor and its affiliates with the other parties hereto as
described and referred to herein.
You acknowledge that we may
receive a future benefit on matters unrelated to this matter, including, without limitation, discount, credit or other accommodation,
from any of such counsel based on the fees such counsel may receive on account of their relationship with us, including without limitation, fees
paid pursuant hereto (it being understood and agreed that, in no event, shall the expenses include items in respect of any unrelated
matter or otherwise be increased as a result of such counsel’s representation of us on another matter or on account or our
relationship with such counsel).
As you know, each Commitment
Party and its respective affiliates is a full service securities firm engaged, either directly or through its affiliates, in various activities,
including securities trading, commodities trading, hedging, investment management, financing and brokerage activities and financial planning
and benefits counseling for both companies and individuals. In the ordinary course of these activities, the Commitment Parties and their
respective affiliates may actively engage in commodities trading or trade the debt and equity securities (or related derivative securities)
and financial instruments (including bank loans and other obligations) of you, the Company, any of your or their respective subsidiaries
and affiliates and other companies which may be the subject of the arrangements contemplated by this letter for their own account and
for the accounts of their customers and may at any time hold long and short positions in such securities. The Commitment Parties and their
respective affiliates may also co-invest with, make direct investments in, and invest or co-invest client monies in or with funds or other
investment vehicles managed by other parties, and such funds or other investment vehicles may trade or make investments in securities
of you, the Company, any of your or their respective subsidiaries and affiliates or other companies which may be the subject of the arrangements
contemplated by this Commitment Letter or engage in commodities trading with any thereof.
The Commitment Parties and
their respective affiliates may have economic interests that conflict with those of the Company and you. You agree that the Commitment
Parties will act under this letter as independent contractors and that nothing in this Commitment Letter or the Fee Letter or otherwise
will be deemed to create an advisory, fiduciary or agency relationship or fiduciary or other implied duty between the Commitment Parties
and you and the Company, your and its respective equity holders or your and its respective affiliates. You acknowledge and agree that
(i) the transactions contemplated by this Commitment Letter and the Fee Letter are arm’s-length commercial transactions between
the Commitment Parties, on the one hand, and you and the Company, on the other, (ii) in connection therewith and with the process
leading to such transaction each Commitment Party is acting solely as a principal and not as agents or fiduciaries of you, the Company,
your and its management, equity holders, creditors or any other person, (iii) the Commitment Parties have not assumed an advisory
or fiduciary responsibility or any other obligation in favor of you with respect to the transactions contemplated hereby or the process
leading thereto (irrespective of whether the Commitment Parties or any of their respective affiliates have advised or are currently advising
you or the Company on other matters) except the obligations expressly set forth in this Commitment Letter and the Fee Letter and (iv) you
have consulted your own legal, tax, accounting and financial advisors to the extent you deemed appropriate. You further acknowledge and
agree that you are responsible for making your own independent judgment with respect to such transactions and the process leading thereto.
Please note that the Commitment Parties and their affiliates have not provided any legal, accounting, regulatory or tax advice. You agree
that you will not claim that the Commitment Parties (in their capacity as such) or their applicable affiliates, as the case may be, have
rendered advisory services of any nature or respect, or owe a fiduciary or similar duty to you or your affiliates, in connection with
the transactions contemplated by this Commitment Letter or the process leading thereto.
9. Assignments;
Amendments; Governing Law, Etc.
This Commitment Letter and
any claim, controversy or dispute arising under or related to this Commitment Letter and the commitments hereunder shall not be assignable
by any party hereto (other than, (i) occurring as a matter of law pursuant to, or otherwise substantially simultaneously with (and
subject to the consummation of), the Acquisition, in each case to one or more of the Company and/or any other domestic subsidiary of the
Company and (ii) by you to the Borrower, and/or to other U.S. domestic entities already existing or established in connection with
the Transactions and wholly-owned, directly or indirectly, immediately after giving effect to the Transactions by the Investors, with
all obligations and liabilities of Holdings hereunder being assumed by the Borrower and/or such other entities upon the effectiveness
of such assignment)) without the prior written consent of each other party hereto (such consent not to be unreasonably withheld or delayed)
(and any attempted assignment without such consent shall be null and void). This Commitment Letter and the commitments hereunder are intended
to be solely for the benefit of the parties hereto (and Indemnified Persons) and are not intended to confer any benefits upon, or create
any rights in favor of, any person other than the parties hereto (and Indemnified Persons to the extent expressly set forth herein). Subject
to the limitations otherwise set forth herein, each Commitment Party reserves the right to employ the services of its respective affiliates
or branches in providing services contemplated hereby and to allocate, in whole or in part, to their affiliates or branches certain fees
payable to such Commitment Party in such manner as such Commitment Party and its respective affiliates or branches may agree in their
sole discretion and, to the extent so employed, such affiliates and branches shall be entitled to the benefits and protections afforded
to, and subject to the provisions governing the conduct of, such Commitment Party hereunder. This Commitment Letter may not be amended
or any provision hereof waived or modified except by an instrument in writing signed by each of the Commitment Parties and you. This Commitment
Letter may be executed in any number of counterparts, each of which shall be an original and all of which, when taken together, shall
constitute one agreement. Delivery of an executed counterpart of a signature page of this Commitment Letter by facsimile transmission
or other electronic transmission (i.e., a “pdf” or “tif”), including by electronic signatures or electronic records,
each of which shall be of the same legal effect, validity or enforceability as a manually executed signature, to the extent and as provided
for in any applicable law, shall be effective as delivery of a manually executed counterpart hereof. This Commitment Letter (including
the exhibits hereto) and the Fee Letter (i) are the only agreements that have been entered into among the parties hereto with respect
to the Facilities and (ii) supersede all prior understandings, whether written or oral, among us with respect to the Facilities and
sets forth the entire understanding of the parties hereto with respect thereto.
Each of the parties hereto
agrees that (i) this Commitment Letter is a binding and enforceable agreement (subject to the effects of bankruptcy, insolvency,
fraudulent conveyance, reorganization and other similar laws relating to or affecting creditors’ rights generally and general principles
of equity (whether considered in a proceeding in equity or law)) with respect to the subject matter contained herein, including an agreement
to negotiate in good faith the Facilities Documentation by the parties hereto in a manner consistent with this Commitment Letter, it being
acknowledged and agreed that the funding of the Facilities is subject only to the conditions precedent as provided herein and (ii) the
Fee Letter is a binding and enforceable agreement (subject to the effects of bankruptcy, insolvency, fraudulent conveyance, reorganization
and other similar laws relating to or affecting creditors’ rights generally and general principles of equity (whether considered
in a proceeding in equity or law)) of the parties thereto with respect to the subject matter set forth therein.
THIS COMMITMENT LETTER AND
THE RIGHTS AND DUTIES OF THE PARTIES HEREUNDER SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK;
PROVIDED THAT, NOTWITHSTANDING THE FOREGOING TO THE CONTRARY, IT IS UNDERSTOOD AND AGREED THAT (A) TO THE EXTENT THE ACQUISITION
IS CONSUMMATED PURSUANT TO THE ACQUISITION AGREEMENT, THE LAWS OF THE STATE SET FORTH IN THE ACQUISITION AGREEMENT SHALL GOVERN IN DETERMINING
(I) WHETHER A MATERIAL ADVERSE EFFECT UNDER THE ACQUISITION AGREEMENT HAS OCCURRED, (II) THE ACCURACY OF ANY COMPANY REPRESENTATION
AND WHETHER YOU (OR ANY OF YOUR SUBSIDIARIES OR AFFILIATES) HAVE THE RIGHT TO TERMINATE YOUR (OR THEIR) OBLIGATIONS UNDER THE ACQUISITION
AGREEMENT OR DECLINE TO CONSUMMATE THE ACQUISITION AS A RESULT OF A BREACH OF SUCH REPRESENTATIONS IN THE ACQUISITION AGREEMENT AND (III) WHETHER
THE ACQUISITION HAS BEEN CONSUMMATED IN ACCORDANCE WITH THE TERMS OF THE ACQUISITION AGREEMENT AND (B) TO THE EXTENT THE ACQUISITION
IS CONSUMMATED PURSUANT TO THE TENDER OFFER, THE FEDERAL SECURITIES LAWS OF THE UNITED STATES SHALL GOVERN IN DETERMINING WHETHER THE
INITIAL OFFER TO PURCHASE HAS BEEN CONSUMMATED IN ACCORDANCE WITH THE TERMS AND CONDITIONS THEREOF.
10. WAIVER
OF JURY TRIAL.
EACH OF THE PARTIES HERETO
IRREVOCABLY WAIVES THE RIGHT TO TRIAL BY JURY IN ANY ACTION, PROCEEDING, CLAIM OR COUNTERCLAIM BROUGHT BY OR ON BEHALF OF ANY PARTY HERETO
RELATED TO OR ARISING OUT OF THIS COMMITMENT LETTER OR THE PERFORMANCE OF SERVICES HEREUNDER.
11. Jurisdiction.
Each of the parties hereto
hereby irrevocably and unconditionally (a) submits, for itself and its property, to the exclusive jurisdiction of any New York State
court or Federal court of the United States of America, in each case, sitting in New York City in the Borough of Manhattan, and any appellate
court from any thereof, in any action or proceeding arising out of or relating to this Commitment Letter, the Fee Letter, the Transactions
or the transactions contemplated hereby, or for recognition or enforcement of any judgment, and agrees that all claims in respect of any
such action or proceeding shall be heard and determined in such New York State court or, to the extent permitted by law, in such Federal
court, (b) waives, to the fullest extent it may legally and effectively do so, any objection which it may now or hereafter have to
the laying of venue of any suit, action or proceeding arising out of or relating to this Commitment Letter, the Fee Letter, the Transactions
or the transactions contemplated hereby in any such New York State court or in any such Federal court, (c) waives, to the fullest
extent permitted by law, the defense of an inconvenient forum to the maintenance of such action or proceeding in any such court and (d) agrees
that a final judgment in any such suit, action or proceeding shall be conclusive and may be enforced in other jurisdictions by suit on
the judgment or in any other matter provided by law. Each of the parties hereto agrees to commence any such action, suit, proceeding or
claim either in the United States District Court for the Southern District of New York or in the Supreme Court of the State of New York,
New York County located in the Borough of Manhattan.
12. Confidentiality.
This Commitment Letter is
delivered to you on the understanding that none of the Fee Letter and its terms or substance, or, prior to your acceptance hereof, this
Commitment Letter and its terms or substance or the activities of any Commitment Party pursuant hereto or to the Fee Letter, shall be
disclosed, directly or indirectly, to any other person or entity (including other lenders, underwriters, placement agents, advisors or
any similar persons) except (a) to the Investor Group (as defined below), and to your and any of the Investor Group’s subsidiaries
and affiliates and your and their respective officers, directors, employees, agents, attorneys, accountants, advisors and controlling
persons who are informed of the confidential nature thereof, on a confidential and need-to-know basis, (b) if the Commitment Parties
consent to such proposed disclosure (such consent not to be unreasonably conditioned, withheld or delayed) or (c) pursuant to the
order of any court or administrative agency in any pending legal or administrative proceeding, or otherwise as required by applicable
law, rule or regulation or compulsory legal process or to the extent requested or required by governmental and/or regulatory authorities,
in each case based on the reasonable advice of your legal counsel (in which case, you agree, to the extent practicable and not prohibited
by applicable law, rule or regulation, to inform us promptly thereof); provided that (i) you may disclose this Commitment
Letter, (but not the Fee Letter) and the contents hereof to the Company and their officers, directors, employees, agents, attorneys, accountants,
advisors and controlling persons, on a confidential and need-to-know basis, (ii) you may disclose the Commitment Letter (but not
the Fee Letter) and its contents in any offering memoranda or private placement memoranda relating to the Notes, in any syndication or
other marketing materials in connection with the Facilities (including any Confidential Information Memorandum and other customary marketing
materials) or in connection with any public or regulatory filing requirement relating to the Transactions, (iii) you may disclose
the Term Sheet and the other exhibits and annexes to the Commitment Letter (but not the Fee Letter, other than the existence thereof)
and the contents thereof, to potential Lenders and their affiliates involved in the related commitments, to equity investors and to rating
agencies in connection with obtaining ratings for the Borrower and the Facilities, (iv) you may disclose the aggregate fees contained
in the Fee Letter as part of Projections, pro forma information or a generic disclosure of aggregate sources and uses related to fee amounts
related to the Transactions to the extent customary or required in offering and marketing materials for the Facilities or in any public
or regulatory filing requirement relating to the Transactions, (v) to the extent the amounts of fees and other economic terms of
the market flex provisions set forth therein have been redacted in a customary manner, you may disclose the Fee Letter and the contents
thereof to the Company, the Sellers and their officers, directors, employees, agents, attorneys, accountants, advisors and controlling
persons, on a confidential and need-to-know basis, (vi) you may disclose this Commitment Letter (but not the Fee Letter) in any tender
offer or proxy relating to the Transactions and (vii) you may disclose the Fee Letter and the contents thereof to any prospective
equity investor and its officers, directors, employees, attorneys, accountants and advisors, in each case on a confidential basis. You
agree that you will permit us to review and approve (such approval not to be unreasonably withheld or delayed) any reference to us or
any of our affiliates in connection with the Facilities or the transactions contemplated hereby contained in any press release (or other
written public statement that references any Commitment Party or affiliate thereof by name) prior to public release. The confidentiality
provisions set forth in this paragraph shall survive the termination of this Commitment Letter and expire and shall be of no further effect
after the second anniversary of the date hereof.
Each Commitment Party and
its affiliates will use all non-public information provided to any of them or such affiliates by or on behalf of you hereunder or in connection
with the Transactions solely for the purpose of providing the services which are the subject of this Commitment Letter and negotiating,
evaluating and consummating the transactions contemplated hereby and shall treat confidentially all such information and shall not publish,
disclose or otherwise divulge such information; provided that nothing herein shall prevent such Commitment Party and its affiliates
from disclosing any such information (a) pursuant to the order of any court or administrative agency or in any pending legal, judicial
or administrative proceeding, or otherwise as required by applicable law, rule or regulation or compulsory legal process (in which
case such Commitment Party agrees (except with respect to any audit or examination conducted by bank accountants or any governmental,
bank regulatory or self-regulatory authority exercising examination or regulatory authority), to the extent practicable and not prohibited
by applicable law, rule or regulation, to inform you promptly thereof prior to disclosure), (b) upon the request or demand of
any regulatory authority (including any self-regulatory authority) having jurisdiction over such Commitment Party or any of its affiliates
(in which case such Commitment Party agrees (except with respect to any audit or examination conducted by bank accountants or any governmental,
bank regulatory or self-regulatory authority exercising examination or regulatory authority) to the extent practicable and not prohibited
by applicable law, rule or regulation, to inform you promptly thereof prior to disclosure), (c) to the extent that such information
becomes publicly available other than by reason of improper disclosure by such Commitment Party or any of its affiliates or any related
parties thereto in violation of any confidentiality obligations owing to you, the Investors, the Company or any of your or their respective
subsidiaries or affiliates or related parties (including those set forth in this paragraph), (d) to the extent that such information
is received by such Commitment Party from a third party that is not, to such Commitment Party’s knowledge, subject to confidentiality
obligations owing to you, the Investors, the Company or any of your or their respective subsidiaries or affiliates or related parties,
(e) to the extent that such information was already in our possession prior to any duty or other undertaking of confidentiality or
is independently developed by the Commitment Parties without the use of such information, (f) to other Commitment Parties and such
Commitment Party’s affiliates and to its and their respective officers, directors, partners, employees, legal counsel, independent
auditors and other experts, advisors or agents who need to know such information in connection with the Transactions and who are informed
of the confidential nature of such information and who are subject to customary confidentiality obligations of professional practice or
who agree to be bound by the terms of this paragraph (or language substantially similar to this paragraph) (with each such Commitment
Party, to the extent within its control, responsible for such person’s compliance with this paragraph), (g) to potential or
prospective Lenders, hedge providers, participants or assignees, in each case who agree (pursuant to customary syndication practice) to
be bound by the terms of this paragraph (or language substantially similar to this paragraph); provided that (i) the disclosure
of any such information to any Lenders, hedge providers or prospective Lenders, hedge providers or participants or prospective participants
referred to above shall be made subject to the acknowledgment and acceptance by such Lender, hedge provider or prospective Lender or participant
or prospective participant that such information is being disseminated on a confidential basis (on substantially the terms set forth in
this paragraph or as is otherwise reasonably acceptable to you and each Commitment Party, including, without limitation, as agreed in
any Information materials or other marketing materials) in accordance with the standard syndication processes of such Commitment Party
or customary market standards for dissemination of such type of information, which shall in any event require “click through”
or other affirmative actions on the part of recipient to access such information and (ii) no such disclosure shall be made by such
Commitment Party to any person that is at such time a Disqualified Lender, (h) for purposes of establishing a “due diligence”
defense or (i) to rating agencies in connection with obtaining ratings for the Borrower, the Facilities and the Notes. In addition,
each Commitment Party may disclose the existence of the Facilities to market data collectors, similar service providers to the lending
industry and service providers to the Commitment Parties in connection with the administration and management of the Facilities. In the
event that the Facilities are funded, the Commitment Parties’ and their respective affiliates’, if any, obligations under
this paragraph, shall terminate automatically and be superseded by the confidentiality provisions in the Facilities Documentation upon
the initial funding thereunder to the extent that such provisions are binding on such Commitment Parties. Otherwise, the confidentiality
provisions set forth in this paragraph shall survive the termination of this Commitment Letter and expire and shall be of no further effect
after the second anniversary of the date hereof.
13. Surviving
Provisions.
The syndication, information,
reimbursement (if applicable), compensation (if applicable in accordance with the terms hereof and the Fee Letter), indemnification, confidentiality,
jurisdiction, governing law, absence of fiduciary relationship and waiver of jury trial provisions contained herein and in the Fee Letter
shall remain in full force and effect regardless of whether Facilities Documentation shall be executed and delivered and notwithstanding
the termination of this Commitment Letter or the Commitment Parties’ commitments hereunder; provided that your obligations
under this Commitment Letter, other than those relating to confidentiality, information and the syndication of the Facilities, shall automatically
terminate and be superseded by the corresponding provisions of the Facilities Documentation upon the initial funding thereunder, and you
shall be automatically released from all liability in connection therewith at such time. You may terminate this Commitment Letter and/or
the Initial Lenders’ commitments (on a pro rata basis amongst the Initial Lenders) with respect to the Facilities (or any portion
thereof as selected by you) hereunder at any time subject to the provisions of the preceding sentence.
14. PATRIOT
ACT Notification.
We hereby notify you that
pursuant to the requirements of the USA PATRIOT Act, Title III of Pub. L. 107-56 (signed into law October 26, 2001, as amended from
time to time, the “PATRIOT Act”), each of us and each of the Lenders may be required to obtain, verify and record
information that identifies the Borrower and the Guarantors, which information may include their names, addresses, tax identification
numbers, a certification regarding beneficial ownership as required by 31 C.F.R. § 1010.230 (such certification, the “Beneficial
Ownership Certification”) and other information that will allow each of us and the Lenders to identify the Borrower and
Guarantors in accordance with the PATRIOT Act. This notice is given in accordance with the requirements of the PATRIOT Act and is effective
as to each of us and each Lender.
15. Acceptance
and Termination.
If the foregoing correctly
sets forth our agreement, please indicate your acceptance of the terms of this Commitment Letter and of the Fee Letter by returning to
the Bank Administrative Agent on behalf of the Commitment Parties executed counterparts hereof and of the Fee Letter not later than 11:59
p.m., New York City time, on April 25, 2022. The Initial Lenders’ respective commitments hereunder and the obligations and
agreements of the Commitment Parties contained herein will expire at such time in the event that the Bank Administrative Agent has not
received such executed counterparts in accordance with the immediately preceding sentence. If you do so execute and deliver to us this
Commitment Letter and the Fee Letter by all of the parties hereto and thereto, this Commitment Letter and the commitments and undertakings
of each of the Commitment Parties shall remain effective and available for you until the earliest to occur of (i) the termination
of your obligations under the Tender Offer unless the Acquisition Agreement shall have been entered into on or prior to such date or otherwise
contemporaneously therewith, (ii) after execution of the Acquisition Agreement and prior to the consummation of the Acquisition,
the termination in writing of the Acquisition Agreement by you in accordance with its terms in the event that the Acquisition is not consummated,
(iii) the consummation of the Acquisition with or without the funding of the Facilities, (iv) 11:59 p.m. New York City
time on the date that is 75 days after the date of this Commitment Letter, if as of such time, an Acquisition Agreement has not been executed,
(v) after the execution of the Acquisition Agreement, 11:59 p.m. New York City time on the “outside date” (or similar
defined term) set forth in the Acquisition Agreement and (vi) 11:59 p.m., New York City time, on April 25, 2023. Upon the
occurrence of any of the events referred to in the preceding sentence, this Commitment Letter and the commitments of the Commitment Parties
hereunder and the agreement of the Commitment Parties to provide the services described herein shall automatically terminate unless each
of the Commitment Parties shall, in its sole discretion, agree to an extension; provided that the termination of any such commitment
pursuant to such paragraph does not prejudice our or your rights and remedies in respect of any breach of this Commitment Letter
[Remainder of this page intentionally left
blank]
The Commitment Parties are
pleased to have been given the opportunity to assist you in connection with the financing for the Acquisition.
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Very truly yours, |
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MORGAN STANLEY SENIOR FUNDING INC. |
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By: |
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/s/ Andrew Earls |
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Name: |
Andrew Earls |
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Title: |
Authorized Signatory |
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BANK OF AMERICA, N.A. |
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By: |
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/s/ Scott Tolchin |
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Name: |
Scott Tolchin |
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Title: |
Managing Director |
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BOFA SECURITIES, INC. |
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By: |
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/s/ Scott Tolchin |
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Name: |
Scott Tolchin |
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Title: |
Managing Director |
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BARCLAYS BANK PLC |
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By: |
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/s/ Jeremy Hazan |
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Name: |
Jeremy Hazan |
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Title: |
Managing Director
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MUFG BANK, LTD. |
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By: |
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/s/ Timothy Dilworth |
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Name: |
Timothy Dilworth |
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Title: |
Managing Director |
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BNP PARIBAS |
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By: |
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/s/ David Berger |
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Name: |
David Berger |
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Title: |
Managing Director |
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By: |
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/s/ Aadil Zuberi |
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Name: |
Aadil Zuberi |
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Title: |
Director |
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BNP PARIBAS SECURITIES CORP. |
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By: |
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/s/ David Berger |
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Name: |
David Berger |
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Title: |
Managing Director |
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By: |
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/s/ Aadil Zuberi |
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Name: |
Aadil Zuberi |
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Title: |
Director |
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MIZUHO BANK, LTD. |
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By: |
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/s/ Raymond Ventura |
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Name: |
Raymond Ventura |
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Title: |
Managing Director |
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SOCIETE GENERALE |
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By: |
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/s/ Richard Knowlton |
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Name: |
Richard Knowlton |
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Title: |
Managing Director |
Accepted and agreed to as of
the date first above written:
X HOLDINGS I, INC. |
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By: |
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/s/ Elon R. Musk |
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Name: |
Elon R. Musk |
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Title: |
President, Treasurer and Secretary |
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X HOLDINGS II, INC. |
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By: |
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/s/ Elon R. Musk |
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Name: |
Elon R. Musk |
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Title: |
President, Treasurer and Secretary |
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Project X
Transaction Description
Capitalized terms used but
not defined in this Exhibit A shall have the meanings set forth in the other Exhibits to the Commitment Letter to which this Exhibit A
is attached (the “Commitment Letter”) or in the Commitment Letter.
X Holdings II, Inc.,
a newly created corporation organized under the laws of Delaware (“Bidco”), formed at the direction of the Investors, together
with certain other investors (which may include management) arranged by and designated by the Investors (collectively with the Investors,
the “Investor Group”), intends to directly or indirectly, acquire all of the outstanding equity interests of, or, directly
or indirectly merge with, Twitter, Inc., a corporation organized under the laws of Delaware (the “Company”).
In connection with the foregoing, it is intended
that:
| a) | The Investors have established (i) Bidco and (ii) X Holdings I, Inc., a newly organized
corporation organized under the laws of Delaware (“Holdings”). |
| b) | The Investor Group will directly or indirectly make equity contributions to Holdings and Holdings will
make equity contributions to Bidco (provided that any such contribution to Holdings or Bidco not made in the form of cash common equity
or Rollover Equity (as defined below) shall be reasonably acceptable to the Commitment Parties) (the foregoing, collectively, the “Equity
Contribution”) in an aggregate amount equal to, when combined with the fair market value of the equity of the Investors,
management and certain other existing equity holders of the Company rolled over (the “Rollover Equity”) or invested
in connection with the Transactions (as defined below) (which such rollover investment may be consummated immediately after the Acquisition),
at least 40.0% (the “Minimum Equity Contribution”) of the sum of (1) the aggregate gross proceeds of the
Facilities and (if applicable) the Notes borrowed on the Closing Date, excluding the gross proceeds of any loans to fund (A) working
capital needs on the Closing Date and (B) original issue discount and/or upfront fees (including by any increase in the aggregate
principal amount of the Term Loan Facility) in connection with the exercise of the “Market Flex Provisions” or “Securities
Demand” under the Fee Letter and (2) the equity capitalization of Holdings and its subsidiaries on the Closing Date after giving
effect to the Transactions, which amount, together with proceeds from the Facilities and (if applicable) the Notes, shall be used to consummate
the Acquisition (the “Acquisition Consideration”), the Refinancing (as defined below), and to pay fees, premiums
and expenses incurred in connection with the Transactions (such fees, premiums and expenses, the “Transaction Costs”,
and together with the Acquisition Consideration and the Refinancing, the “Acquisition Funds”); provided, that
the Investors shall directly or indirectly own at least 50.1% of the voting equity securities of the Company immediately following the
consummation of the Transactions. |
| c) | Pursuant to the Amendment 2 to Schedule 13D/A under the Securities Exchange Act of 1934 filed on behalf
of Elon Musk (“Bidder”) on April 13, 2022, Bidder intends to, directly or indirectly, buy 100% of the issued
and outstanding common stock of the Company for $54.20 per share in cash. Bidco will acquire directly or indirectly (the “Acquisition”)
all of the issued and outstanding equity interests of the Company, pursuant to either (a) a tender offer (as such tender offer may
be amended, supplemented or otherwise modified from time to time, the “Tender Offer”) pursuant to the initial
offer to purchase, to be dated on or about April 2022 (as such offer to purchase may be amended, supplemented or otherwise modified
from time to time, the “Initial Offer to Purchase”) (it being acknowledged that the draft of the Initial Offer
to Purchase received by counsel to the Lead Arrangers on April 20, 2022 at 5:34 p.m. (New York time) is reasonably acceptable
to the Lead Arrangers) and all material documents entered into by Bidco in connection with the Tender Offer, including all exhibits thereto,
as they may be amended, supplemented or otherwise modified from time to time, are collectively referred to herein as the “Tender
Offer Documents”)) for all of the issued and outstanding equity interests of the Company (collectively, the “Shares”),
including any Shares that may become outstanding upon the exercise of options or other rights to acquire Shares after the commencement
of the Tender Offer and/or (b) an agreement and plan of merger (or similarly styled agreement) to be entered into among Holdings
and/or Bidco (and/or one or more of its wholly-owned subsidiaries) and the Target (the “Acquisition Agreement”
and the related transaction contemplated by the Acquisition Agreement being referred to herein as the “Merger Transaction”). |
| [Transaction Description] | |
| d) | The Borrower (i) will obtain $6,500.0 million under the Term Loan Facility, (ii) will obtain
commitments in respect of the Revolving Credit Facility, in an aggregate principal amount of $500 million, (iii) will either issue
the full amount of the Senior Secured Notes and/or borrow up to the unissued amount of the contemplated $3,000.0 million issuance in an
aggregate principal amount of Secured Bridge Loans and (iv) will either issue the full amount of the Unsecured Notes and/or borrow
up to the unissued amount of the contemplated $3,000.0 million issuance in an aggregate principal amount of Unsecured Bridge Loans, in
each case on the Closing Date of the Acquisition. |
| e) | It is understood that (A) all amounts outstanding (other than contingent obligations) under that
certain Revolving Credit Agreement, dated as of August 7, 2018, by and among the Company, the lenders from time to time party thereto
and JPMorgan Chase Bank, N.A., as administrative agent. (as amended, amended and restated or otherwise modified prior to the date hereof,
the “Existing Credit Agreement”) will be repaid and all commitments in respect thereof will be terminated and
all liens in respect of the foregoing (if any) and guarantees related thereto (if any) will be released, (B) all obligations with
respect to the 3.875% Senior Notes due 2027 issued pursuant to that certain Indenture, dated December 9, 2019, among the Company,
as issuer, and U.S. Bank National Association, as trustee will be discharged or defeased in accordance with the such indenture and (C) all
obligations with respect to the 5.000% Senior Notes due 2030 issued pursuant to that certain Indenture, dated February 25, 2022,
among the Company, as issuer, and U.S. Bank National Association, as trustee will be discharged or defeased in accordance with the such
indenture (this paragraph (e), the “Refinancing”). |
The transactions described
above and the payment of related fees and expenses are collectively referred to herein as the “Transactions”.
| [Transaction Description] | |
Project X
$6,500.0 million Term Loan Facility
$500.0 million Revolving Facility
Summary of Principal Terms and Conditions
All capitalized terms used but not defined herein
shall have the meanings given to them in the Commitment Letter to which this term sheet is attached, including Exhibit A thereto.
Borrower: |
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Initially, Bidco and, following the consummation of the Merger Transaction, the Company as the survivor of the merger contemplated thereby (the “Borrower”). |
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Transaction: |
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As set forth in Exhibit A to the Commitment Letter. |
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Bank Administrative Agent: |
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MSSF will act as sole and exclusive administrative agent and collateral agent (in such capacity, the “Bank Administrative Agent”) in respect of the Bank Facilities (as hereinafter defined) for a syndicate of banks, financial institutions and other institutional lenders reasonably acceptable to the Borrower and excluding any Disqualified Lenders (together with the Initial Bank Lenders, the “Bank Lenders”), and will perform the duties customarily associated with such roles. |
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Joint Bookrunners and Lead Arrangers: |
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Each of MSSF, BofA Securities, Barclays, MUFG, BNPP Securities, Mizuho and SocGen will act as a lead arranger and joint bookrunner (together with any additional joint bookrunner appointed pursuant to the Commitment Letter, each in such capacity, a “Bank Lead Arranger”) and will perform the duties customarily associated with such roles. |
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Other Agents: |
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The Borrower may designate additional financial institutions to act as syndication agent, documentation agent or co-documentation agent as provided in the Commitment Letter. |
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Term Loan Facility / Revolving Facility: |
|
A senior secured first lien term loan
facility in an aggregate principal amount of $6,500.0 million (plus, at the Borrower’s election, an amount sufficient to fund any
upfront fees or flex OID required to be funded due to the exercise of the market flex provisions in the Fee Letter) (the “Term
Loan Facility”; the loans thereunder, the “Term Loans”; the Bank Lenders thereunder, the “Term
Loan Lenders”).
A senior secured first lien revolving
credit facility in an aggregate principal amount of $500.0 million (the “Revolving Facility”; and, together
with the Term Loan Facility, the “Bank Facilities”; the commitments thereunder, the “Revolving Commitments”;
the loans thereunder, are collectively referred to as the “Revolving Loans” and, together with the Term Loans;
the Bank Lenders thereunder, the “Revolving Lenders”).
The Revolving Facility shall be
available to the Borrower and shall be available, subject to borrowing mechanics to be agreed, to be drawn in U.S. Dollars. |
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Swingline
Facility: |
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In connection with the Revolving Facility, the First Lien Administrative Agent (in such capacity, the “Swingline Lender”) will make available to the Borrower a swingline facility (the “Swingline Facility”) under which the Borrower may make short-term borrowings (on same-day notice (in minimum amounts to be mutually agreed upon and integral multiples to be agreed upon)) of up to an amount to be agreed. Except for purposes of calculating the commitment fee described on Annex I to this Exhibit B, any such swingline borrowings will reduce availability under the Revolving Facility on a dollar-for-dollar basis. |
| [Bank Facilities Term Sheet] | |
Incremental Facilities: |
|
The Bank Facilities will permit the Borrower to
add one or more incremental term loan facilities to the Term Loan Facility or to increase any existing term loan facility (each, an “Incremental
Term Facility”), and/or increase commitments under the Revolving Facility (any such increase, an “Incremental
Revolving Increase”) and/or add one or more incremental revolving credit facility tranches (each, an “Incremental
Revolving Facility”; the Incremental Term Facilities, the Incremental Revolving Increases and the Incremental Revolving
Facilities are collectively referred to as “Incremental Bank Facilities”) in an aggregate principal amount of
up to (a) the greater of (A) $1,700.0 million (this clause (A), “Incremental Fixed Dollar Basket”) and
(B) 100% of trailing four quarter EBITDA (as defined below) (this clause (B), the “Incremental EBITDA Grower”),
in either case, less the aggregate outstanding principal amount of all Incremental Equivalent Debt (as defined below) pursuant
to the corresponding basket, plus (b) (i) all voluntary prepayments and voluntary commitment reductions of the Term Loan
Facility (including, in the case of loan buy-backs, the face amount of loans repurchased), any Incremental Term Facilities secured on
a pari passu basis with the Term Loan Facility and any Incremental Equivalent Debt secured on a pari passu basis with the Term Loan Facility
(including, in each case, voluntary prepayments made at a discount to par) and (ii) voluntary permanent commitment reductions of the Revolving
Facility and any Incremental Revolving Facilities secured on a pari passu basis with the Term Loan Facility prior to the date of any such
incurrence (in each case, to the extent not funded with the proceeds of long-term debt) plus (c) an additional amount such
that, after giving effect to the incurrence of such additional amount (but without giving effect to any amount incurred simultaneously
under clause (a) or (b) above) and after giving pro forma effect to any acquisition or investment consummated in connection
therewith or any other appropriate pro forma adjustments, the First Lien Leverage Ratio (as defined below) is equal to or less than (x)
the First Lien Leverage Ratio in effect on the Closing Date (such ratio, the “Closing Date First Lien Leverage Ratio”)
or (y) solely to the extent such indebtedness is incurred in connection with a permitted acquisition or other investment permitted under
the Bank Facilities Documentation, less than or equal to the First Lien Leverage Ratio immediately prior to giving effect to such incurrence
and all transactions in connection therewith if greater than the Closing Date First Lien Leverage Ratio (the “First Lien Ratio
Basket”) (in each case, assuming all such additional amounts (including, for the avoidance of doubt, any Incremental Equivalent
Debt) were secured on a first lien basis, whether or not so secured), (including for this purpose the full amount of any Incremental Revolving
Increase or Incremental Revolving Facility and not netting the proceeds of the incurrence of any Incremental Bank Facilities), subject
to the following conditions:
(i) no existing Bank Lender will be required to
participate in any such Incremental Bank Facilities,
(ii) no event of default exists, or would
exist after, giving effect thereto (except in connection with any permitted acquisition or other investment, where no payment or bankruptcy
event of default will be the standard),
|
| [Bank Facilities Term Sheet] | |
|
| (iii) the final maturity date and the weighted
average maturity of any such Incremental Term Facility shall not be earlier than, or shorter than, as the case may be, the maturity date
or the weighted average life to maturity (without giving effect to prepayments), as applicable, of the Term Loan Facility; provided that
this clause (iii) shall not apply to (1) up to the greater of (x) $1,700.0 million and (y) 100% of the trailing four quarter EBITDA of
the Incremental Term Facility (the “Incremental Maturity Carveout Grower”) and/or Incremental Equivalent Debt
(as defined below) (the “Incremental Maturity Carveout”) or (2) any bridge financing converting to, or intended
to be refinanced by, debt complying with the applicable maturity and weighted average life requirement,
(iv) the pricing, interest rate margins, discounts,
premiums, rate floors, fees and amortization schedule applicable to any Incremental Term Facility shall be determined by the Borrower
and the lenders thereunder; provided that, except with respect to (A) up to the greater of (x) $850.0 million and (y) 50% of trailing
four quarter EBITDA of the Incremental Term Facility (as selected by the Borrower) (the “MFN Dollar Carveout”),
(B) any Incremental Term Facility which is incurred pursuant to the First Lien Ratio Basket or (C) any Incremental Term Facility that
(I) matures later than two years after the maturity date with respect to the Term Loan Facility (such maturity carveout, the “MFN
Maturity Carveout”) or (II) is incurred in connection with a Permitted Acquisition or other investment permitted under the
Bank Facilities Documentation (such Permitted Acquisition or other investment carveout, the “MFN Permitted Acquisition Carveout”),
only during the period commencing on the Closing Date and ending on the date that is six months after the Closing Date (the “MFN
Sunset Date”), if the applicable interest rate relating to any such Incremental Term Facility of like currency exceeds the
applicable interest rate relating to the Term Loan Facility by more than 1.00% (the “MFN Margin”) the applicable
interest rate relating to the existing Term Loan Facility shall be adjusted to be equal to the applicable interest rate relating to such
Incremental Term Facility minus the MFN Margin at such time; provided that in determining such applicable interest rates, (x) OID or upfront
fees (which shall be deemed to constitute a like amount of OID) paid by the Borrower to the lenders under such Incremental Term Facility
(but exclusive of any arrangement, structuring or other fees payable in connection therewith that are not shared with lenders providing
such Incremental Term Facility or consent fees for an amendment paid generally to consenting lenders) and the existing Term Loan Facility
in the initial primary syndication thereof shall be included and equated to interest rate (with OID being equated to interest based on
an assumed four-year life to maturity) and (y) any amendments to the applicable margin on the existing Term Loan Facility that became
effective subsequent to the Closing Date but prior to the time of such Incremental Term Facility shall also be included in such calculations;
provided, further, that (A) with respect to the existing Term Loan Facility, to the extent that Term SOFR for a three month interest period
on the closing date of any such Incremental Term Facility is less than the interest rate floor applicable to any such existing Term Loan
Facility, the amount of such difference shall be deemed added to the interest margin for the existing Term Loans, solely for the purpose
of determining whether an increase in the interest rate margins for the existing Term Loans shall be required and (B) with respect to
any Incremental Term Facility, to the extent that Term SOFR, as applicable to the existing Term Loan Facility for a three month interest
period on the closing date of any such Incremental Term Facility is less than the interest rate floor, if any, applicable to any such
Incremental Term Facility, the amount of such difference shall be deemed added to the interest rate margins for the loans under the Incremental
Term Facility, |
| [Bank Facilities Term Sheet] | |
|
(v) any
Incremental Revolving Facility and any Incremental Revolving Increase shall be on the same terms and pursuant to the same documentation
applicable to the Revolving Facility (other than, in the case of an Incremental Revolving Facility, pricing, fees, maturity and other
immaterial terms which shall be determined by the Borrower and the lenders providing such Incremental Revolving Facility); provided
that the final maturity date and the weighted average maturity of any such Incremental Revolving Facility shall not be earlier than,
or shorter than, as the case may be, the maturity date or the weighted average life, as applicable, of the Revolving Facility, and
(vi) any Incremental Term Facility shall
be on terms and pursuant to documentation to be determined by the Borrower and the lenders providing such financing, provided
that, to the extent such terms and documentation are not consistent with, the Term Loan Facility (except to the extent permitted
by clause (iii) or (iv) above), they shall be reasonably satisfactory to the Bank Administrative Agent (except for (x) covenants
or other provisions applicable only to the periods after the latest maturity date of any Term Loan Facility or any existing Incremental
Term Facility existing at the time such Incremental Term Facility is incurred, (y) terms beneficial to the lenders where the
Term Loan Facility also receives the benefit of such beneficial terms and (z) terms that, taken as a whole and as reasonably
determined by the Borrower, reflect current market terms for such type of indebtedness) (it being understood to the extent that any
financial maintenance covenant is added for the benefit of any Incremental Term Facility, no consent shall be required from any Administrative
Agent or any Lender to the extent that such financial maintenance covenant is also added for the benefit of all of the Term Loan
Facility).
As used herein, (a) the “First
Lien Leverage Ratio” means the ratio of total first lien net debt (calculated net of unrestricted cash and cash equivalents
of the Borrower and its restricted subsidiaries (other than the proceeds of Incremental Term Facilities and Incremental Equivalent Debt
to be incurred at such time that are applied for the specified transaction in connection with such incurrence)) for borrowed money secured
by first or super senior priority liens on substantially all of the Collateral (including outstanding Revolving Loans) to trailing four-quarter
EBITDA, and (b) the “Total Leverage Ratio” means the ratio of total net debt (calculated net of unrestricted
cash and cash equivalents of the Borrower and its restricted subsidiaries (other than the proceeds of Incremental Term Facilities and
Incremental Equivalent Debt to be incurred at such time that are applied for the specified transaction in connection with such incurrence))
for borrowed money, capital leases and purchase money obligations to trailing four-quarter EBITDA.
|
| [Bank Facilities Term Sheet] | |
|
The Bank Facilities Documentation will permit
the Borrower to utilize availability under the Incremental Term Facilities amount to issue first lien and second lien indebtedness
(provided that any first lien term loans shall be subject to the applicable MFN protection) or junior lien secured indebtedness
(in each case, subject to customary intercreditor terms consistent with the Documentation Principles and set forth in an exhibit
to the definitive documentation for the Term Loan Facility), or unsecured indebtedness (such secured or unsecured indebtedness, “Incremental
Equivalent Debt”), with the amount of such secured or unsecured indebtedness reducing the aggregate principal amount
available for the Incremental Term Facilities; provided that such secured or unsecured indebtedness (i) except with respect
to the Incremental Maturity Carveout and any bridge financing converting to, or intended to be refinanced by, debt complying with
the applicable maturity and weighted average life requirement, does not mature on or prior to the maturity date of, or have a shorter
weighted average life to maturity than, loans under the Term Loan Facility, (ii) reflects market terms at the time of incurrence
or issuance as reasonably determined by the Borrower (it being understood to the extent that any financial maintenance covenant is
added for the benefit of any such debt, such financial maintenance covenant shall also be added for the benefit of any corresponding
existing Facility), (iii) there shall be no borrower or guarantor in respect of any such indebtedness that is not the Borrower
or a Guarantor and (iv) if secured, such indebtedness shall not be secured by any assets of the Borrower or its subsidiaries
that do not constitute Collateral; provided that clauses (iii) and (iv) shall not apply to a sublimit to be agreed. |
|
|
Purpose/Use of Proceeds: |
(A) The proceeds of borrowings
under the Term Loan Facility will be used by the Borrower, on the date of the initial borrowing under the Term Loan Facility (the
“Closing Date”), together with the proceeds of the Revolving Facility (as set forth under the heading “Availability”
below), the issuance of the Notes and/or borrowings of the Bridge Loans and proceeds of the Equity Contribution and cash on hand
of the Borrower and its subsidiaries, solely to finance the Transactions and fund upfront fees or flex OID in respect of any of the
Facilities imposed due to the exercise of the “market flex provisions” under the Fee Letter.
(B) The Letters of Credit
and proceeds of Revolving Loans will be used by the Borrower and its subsidiaries for working capital and for other general corporate
purposes (including, subject to the “Availability” section immediately below, to finance the Transactions and any other
transactions not prohibited by the Bank Facilities Documentation). |
|
|
Availability: |
(A) The Term Loan Facility
will be available in a single drawing on the Closing Date. Amounts borrowed under the Term Loan Facility that are repaid or prepaid
may not be reborrowed.
(B) (i) Revolving Loans
(exclusive of Letter of Credit usage) may be made available on the Closing Date to fund working capital in an amount not to exceed
$40.0 million and (ii) any OID or upfront fees required to be funded on the Closing Date due to the exercise of the “Market
Flex Provisions” under the Fee Letter may be funded with Revolving Loans on the Closing Date. Additionally, Letters of Credit
may be issued on the Closing Date in order to backstop or replace letters of credit outstanding on the Closing Date under the facilities
no longer available to the Company or any of its affiliates as of the Closing Date (and such existing letters of credit may be deemed
Letters of Credit outstanding under the Revolving Facility). Otherwise, Revolving Loans will be available at any time prior to the
final maturity of the Revolving Facility, in minimum principal amounts to be agreed upon. Amounts repaid under the Revolving Facility
may be reborrowed. The Revolving Facility shall be available for same day borrowings in ABR on terms and conditions to be agreed. |
| [Bank Facilities Term Sheet] | |
Interest Rates and Fees: |
As set forth on Annex I
to this Exhibit B. |
|
|
Default Rate: |
During the continuance of any payment or bankruptcy event
of default under the Bank Facilities Documentation, with respect to overdue principal, the applicable interest rate plus 2.00% per
annum, and with respect to any other overdue amount, including overdue interest, the interest rate applicable to ABR loans (as defined
in Annex I) plus 2.00% per annum. |
|
|
Letters of Credit: |
A portion of the Revolving Facility to be
agreed (the “LC Sublimit”) will be available to the Borrower for the purpose of issuing letters of credit
(the “Letters of Credit”); provided that each of the Initial Lenders shall only be required to issue
standby letters of credit. Each Initial Lender agrees to be an Issuing Lender (as defined below) in a fronting capacity for its proportionate
share of such LC Sublimit (based on its Revolving Commitment), with the Initial Lenders, in the aggregate, committing to the full
amount of the LC Sublimit. Letters of Credit will be issued by the Initial Lenders under the Revolving Facility (sharing ratably
in the Letter of Credit sub-limit commitment) and other Revolving Lenders (reasonably acceptable to the Borrower and the Bank Administrative
Agent) who agree to issue Letters of Credit (each, an “Issuing Lender”). Each Letter of Credit shall expire
not later than the earlier of (a) 12 months after its date of issuance or such longer period of time as may be agreed by the
applicable Issuing Lender and (b) the third business day prior to the final maturity of the Revolving Facility; provided
that any Letter of Credit may provide for automatic renewal thereof for additional periods of up to 12 months or such longer
period of time as may be agreed by the applicable Issuing Lender (which in no event shall extend beyond the date referred to in clause
(b) above, except to the extent cash collateralized or backstopped pursuant to arrangements reasonably acceptable to the relevant
Issuing Lender; provided that no Revolving Lender shall be required to fund participations in Letters of Credit after the
maturity date applicable to its commitments).
Letters of Credit shall be issued on terms
and conditions (including with respect to defaulting lenders) consistent with Documentation Precedent and the Documentation Principles.
The issuance of all Letters of Credit shall be subject to the customary policies and procedures of the relevant Issuing Lender. |
|
|
Final Maturity and
Amortization: |
(A) The Term Loan Facility will mature
on the date that is seven years after the Closing Date and, commencing one full fiscal quarter after the Closing Date, will amortize
in equal quarterly installments in aggregate annual amounts equal to 1.00% of the original principal amount of the Term Loan Facility
with the balance payable on the seventh anniversary of the Closing Date; provided that the Bank Facilities Documentation shall
provide the right of individual Term Loan Lenders to agree to extend the maturity of their Term Loans upon the request of the Borrower
and without the consent of any other Term Lender (as further described below).
(B) Revolving
Facility
The Revolving Facility will mature, and Revolving
Commitments will terminate, on the date that is five years after the Closing Date; provided that the Bank Facilities Documentation
shall provide the right of individual Revolving Lenders to agree to extend the maturity of their Revolving Commitments and Revolving
Loans upon the request of the Borrower and without the consent of any other Lender (as further described below).
|
| [Bank Facilities Term Sheet] | |
|
The Bank Facilities Documentation shall contain customary “amend
and extend” provisions pursuant to which any individual Bank Lender may agree to extend (which may include, among other things,
an increase in the interest rates payable with respect to such extended loans, which extensions shall not be subject to any “default
stopper”, financial tests or “most favored nation pricing provisions”) the maturity date of its outstanding commitments
in respect of the Revolving Facility or under any Incremental Revolving Facility or in respect of any class of Term Loans (including
any loans under an Incremental Term Facility), in each case, upon the request of the Borrower and without the consent of any other
Bank Lender (it is understood that (i) no existing Bank Lender will have any obligation to commit to any such extension and
(ii) each Bank Lender under the class being extended shall have the opportunity to participate in such extension on the same
terms and conditions as each other Bank Lender under such class). |
|
|
Guarantees: |
All obligations of the Borrower (the “Obligations”)
under (i) the Bank Facilities, (ii) at the written request of the Borrower, interest rate protection, commodity trading
or hedging, currency exchange or other non-speculative hedging or swap arrangements (other than any obligation of any Guarantor to
pay or perform under any agreement, contract, or transaction that constitutes a “swap” within the meaning of Section 1a(47)
of the Commodity Exchange Act (a “Swap”), if, and to the extent that, all or a portion of the guarantee
by such Guarantor of, or the grant by such Credit Party of a security interest to secure, such Swap (or any guarantee thereof) is
or becomes illegal or unlawful under the Commodity Exchange Act or any rule, regulation, or order of the Commodity Futures Trading
Commission (or the application or official interpretation of any thereof)) entered into by the Borrower or any of its restricted
subsidiaries with the Bank Administrative Agent, any Lender, Bank Lead Arranger or any affiliate of the Bank Administrative Agent,
a Lender or Bank Lead Arranger at the time of entering into such arrangement (the “Hedging Arrangements”)
(collectively, “Hedging Obligations”) and (iii) at the written request of the Borrower, cash management
and treasury arrangements entered into by the Borrower or any of its subsidiaries with the Bank Administrative Agent, any Lender,
Lead Arranger or any affiliate of the Bank Administrative Agent, a Lender or Lead Arranger at the time of entering into such arrangement
(“Treasury Arrangements”) (collectively, “Cash Management Obligations”) will
be unconditionally guaranteed jointly and severally on an equal priority senior secured basis (the “Guarantees”)
by Holdings and each existing and subsequently acquired or organized direct or indirect wholly-owned U.S. restricted subsidiary
of the Borrower (other than any such subsidiary (a) that is a subsidiary of a non-U.S. subsidiary of the Borrower, including
any such non-U.S. subsidiary that is a “controlled foreign corporation” within the meaning of Section 957 of the
Code (a “CFC”), (b) that is a U.S. subsidiary substantially all of the assets of which consist of
the equity and/or debt or receivables of one or more direct or indirect non-U.S. subsidiaries that are CFCs (a “CFC Holdco”),
(c) that has been designated as an unrestricted subsidiary, (d) that is below a materiality threshold (based on assets
or revenues) to be agreed consistent with the Documentation Principles, (e) that is not permitted by law, regulation or contract
(to the extent existing on the Closing Date or, if later, the date it becomes a restricted subsidiary and in each case, not entered
into in contemplation thereof) to provide such guarantee, or would require third party or governmental (including regulatory) consent,
approval, license or authorization to provide such guarantee, (unless such consent, approval, license or authorization has been received),
or for which the provision of such guarantee would result in a material adverse tax consequence to the Borrower or one of its subsidiaries
(as reasonably determined by the Borrower in consultation with the Bank Administrative Agent), (f) that is a special purpose
entity (including not for profit entities and captive insurance companies), (g) that is a registered broker-dealer, or (h) any
restricted subsidiary acquired pursuant to a Permitted Acquisition (to be defined in a manner consistent with the Documentation Principles))
financed with secured indebtedness permitted to be incurred pursuant to the Bank Facilities Documentation as assumed indebtedness
(and not incurred in contemplation of such Permitted Acquisition) and any restricted subsidiary thereof that guarantees such indebtedness,
in each case to the extent such secured indebtedness prohibits such subsidiary from becoming a Guarantor) (the “Subsidiary
Guarantors”) and by Holdings (together with the Subsidiary Guarantors, the “Guarantors”;
and, together with the Borrower, the “Credit Parties”). In addition, certain subsidiaries may
be excluded from the guarantee requirements under the Bank Facilities Documentation in circumstances where the Borrower and the Bank
Administrative Agent reasonably agree that the cost of providing such a guarantee is excessive in relation to the value afforded
thereby. The guarantees to be issued in respect of the Notes or the Bridge Loans (x) will be equal in right of payment
with the obligations under the Guarantees and (y) will automatically be released upon the release of the corresponding guarantees
under the Bank Facilities (other than in connection with a refinancing or repayment in full of the Bank Facilities). To
the extent the Bank Administrative Agent determines any subsidiary of Holdings shall be excluded from the guarantee requirements
under a provision that exists in substantially the same form in both the Bank Facilities Documentation, the Secured Bridge Facility
Documentation, the Unsecured Bridge Facility Documentation, the Secured Bridge Administrative Agent and the Unsecured Bridge Administrative
Agent shall automatically be deemed to accept such determination and shall execute any documentation, if applicable, requested by
the Borrower in connection therewith. No Subsidiary Guarantor shall be relieved of its obligation under the Bank Facilities
Documentation to provide a Guarantee in respect of the Obligations simply by virtue of such Guarantor becoming an Excluded Subsidiary
(to be defined in the Bank Facilities Documentation) unless the transaction or series of transactions resulting in such
Guarantor becoming an Excluded Subsidiary was undertaken with an unaffiliated third party on an arm’s-length basis for purposes
other than evading the aforesaid Guarantee obligations. |
| [Bank Facilities Term Sheet] | |
|
Subject only to the restricted payment covenant
in the Bank Facilities Documentation and no continuing payment or bankruptcy event of default, the Borrower may designate any subsidiary
as an “unrestricted subsidiary” and subsequently redesignate any such unrestricted subsidiary as a restricted subsidiary. Unrestricted
subsidiaries will be excluded from the guarantee requirements and will not be subject to the representations and warranties, covenants,
events of default or other provisions of the Bank Facilities Documentation, and the results of operations and indebtedness of unrestricted
subsidiaries will not be taken into account for purposes of calculating any financial metric contained in the Bank Facilities Documentation
except to the extent of distributions received therefrom. Notwithstanding the foregoing, the Bank Facilities Documentation shall
prohibit (x) the designation of any Guarantor that holds material intellectual property from being designated as a non-Guarantor
or unrestricted subsidiary and (y) the transfer of any material intellectual property from the Borrower or any Guarantor to
any non-Guarantor or unrestricted Subsidiary. |
|
|
Security: |
Subject to the limitations set forth below in this section,
and, on the Closing Date, the Funding Conditions Provisions, the Obligations, the Guarantees in respect of the Obligations, the Hedging
Arrangements and the Treasury Arrangements will be secured on a first priority basis by substantially all of the present and after
acquired assets of each of the Credit Parties (collectively, but excluding the Excluded Assets (as defined below), the “Collateral”),
including, (a) a perfected pledge of all the capital stock of the Borrower and each direct, wholly owned material restricted
subsidiary held by any Credit Party (which pledge, in the case of any foreign subsidiary of a U.S. entity or any CFC Holdco shall
be limited to 65% of the voting capital stock and 100% of the non-voting capital stock of such foreign subsidiary or CFC Holdco,
as applicable) and (b) a perfected security interest in substantially all other tangible and intangible assets of the Credit
Parties (including but not limited to accounts receivable, inventory, equipment, general intangibles, investment property, real property,
intellectual property and the proceeds of the foregoing). |
|
|
|
Notwithstanding anything to the contrary, the Collateral
shall exclude the following: (i) any fee owned real property and all leasehold interests in real property (including requirements
to deliver landlord lien waivers, estoppels and collateral access letters), (ii) motor vehicles and other assets subject to
certificates of title, letter of credit rights (other than to the extent such rights can be perfected by filing a UCC-1) and commercial
tort claims, (iii) except to the extent a security interest therein can be perfected by filing a UCC-1, any assets specifically
requiring perfection through control, control agreements or other control arrangements (other than delivery of certificated pledged
capital stock to the extent required above and material promissory notes constituting Collateral), including deposit accounts, securities
accounts and commodities accounts, (iv) those assets over which the granting of security interests in such assets would be prohibited
by contract binding on such assets prior to the Closing Date, or, if acquired after the Closing Date, at the time of their acquisition
and not incurred in contemplation of such acquisition (including permitted liens, leases and licenses), applicable law or regulation
(in each case, except to the extent such prohibition is unenforceable after giving effect to applicable provisions of the Uniform
Commercial Code, other than proceeds thereof, the assignment of which is expressly deemed effective under the Uniform Commercial
Code notwithstanding such prohibitions) or to the extent that such security interests would require obtaining the consent of any
governmental authority or would result in materially adverse tax consequences as reasonably determined by the Borrower in consultation
with the Bank Administrative Agent, (v) margin stock (other than the shares of the Company to the extent constituting margin
stock) and, to the extent requiring the consent of one or more third parties or prohibited by the terms of any applicable organizational
documents, joint venture agreement or shareholders’ agreement, equity interests in any person other than wholly-owned material
restricted subsidiaries, (vi) those assets as to which the Bank Administrative Agent and the Borrower reasonably determine that
the cost of obtaining such a security interest or perfection thereof (including, without limitation, the cost of title insurance,
surveys or flood insurance (if necessary)) are excessive in relation to the benefit to the Bank Lenders of the security to be afforded
thereby, (vii) any intent-to-use trademark application prior to the filing of a “Statement of Use” or “Amendment
to Allege Use” with respect thereto, (viii) any lease, license or other agreement or any property subject to a purchase
money security interest, capital lease obligation or similar arrangement permitted under the Bank Facilities Documentation to the
extent that a grant of a security interest therein would violate or invalidate such lease, license or agreement or purchase money,
capital lease or similar arrangement or create a right of termination in favor of any other party thereto (other than the Borrower
or a Guarantor) after giving effect to the applicable anti-assignment provisions of the Uniform Commercial Code), other than proceeds
and receivables thereof, the assignment of which is expressly deemed effective under the Uniform Commercial Code notwithstanding
such prohibition and (ix) other exceptions to be mutually agreed or that are usual and customary for facilities of this type
consistent with the Documentation Principles. The foregoing described in clauses (i) through (ix) are, collectively,
the “Excluded Assets”. |
| [Bank Facilities Term Sheet] | |
|
No actions in any non-U.S. jurisdiction or
required by the laws of any non-U.S. jurisdiction shall be required to be taken to create any security interests in assets located
or titled outside of the U.S. or to perfect or make enforceable any security interests in any assets (it being understood that there
shall be no security agreements, pledge agreements or similar agreements governed under the laws of any non U.S. jurisdiction). |
|
|
|
All the above-described pledges, security interests and
mortgages shall be created and perfected on the terms set forth in Bank Facilities Documentation, and none of the Collateral or other
assets of the Credit Parties shall be subject to other pledges, security interests or mortgages, subject to permitted liens and customary
exceptions for financings of this kind consistent with the Documentation Principles. |
|
|
Intercreditor Agreement: |
The relative rights and priorities in the Collateral for
the secured parties in (a) the Secured Bridge Facility and/or the Senior Secured Notes and (b) the Bank Facilities will
be set forth in a customary pari passu intercreditor agreement as between the collateral agent for the Bank Facilities, on the one
hand, and the collateral agent and/or trustee for the Secured Bridge Facility and/or the Senior Secured Notes, on the other hand
based on market precedent for leading private equity sponsors to be agreed (the “Intercreditor Agreement”). |
| [Bank Facilities Term Sheet] | |
Mandatory Prepayments: |
The Term Loans shall be prepaid with (a) commencing
with the first full fiscal year of the Borrower to occur after the Closing Date, 50% of Excess Cash Flow (to be defined in a manner
consistent with the Documentation Principles) of the Borrower (the “ECF Initial Sweep”), with a reduction
to 25% and elimination based upon achievement of First Lien Leverage Ratios of (x) the Closing Date First Lien Leverage Ratio
minus 0.50:1.00 and (y) the Closing Date First Lien Leverage Ratio minus 1.00:1.00, respectively; provided that (i) any
voluntary prepayments or commitment reductions of loans secured on a pari passu basis with the Term Loans and Revolving Facility
and, to the extent a revolving facility, accompanied by a permanent commitment reduction (including, without duplication, prepayments
at a discount to par, or loan buy-backs permitted pursuant to the Bank Facilities Documentation under the Term Loan Facility, under
any Incremental Term Facility, Ratio Debt or any Incremental Debt, in each case that is secured on a pari passu basis with the Term
Loan Facility, in each case with credit given for the actual amount of the cash payment) shall, at the election of the Borrower,
be credited against excess cash flow prepayment obligations of any fiscal year (including payments made after year-end and prior
to the time such Excess Cash Flow prepayment is due) and to any subsequent fiscal year to the extent the amount of such prepayments
exceed the amount of prepayments required to be made from Excess Cash Flow for such year, when taken together with any other payments
required for such year on a dollar-for-dollar basis (other than to the extent such prepayments are funded with the proceeds of long-term
indebtedness) (with, at the election of the Borrower, the First Lien Leverage Ratio of the Borrower for purposes of determining the
applicable Excess Cash Flow percentage above, recalculated to give pro forma effect to any such pay down or reduction after the end
of the prior fiscal year and prior to making such Excess Cash Flow payment) (including payments made after year-end and prior to
the time such Excess Cash Flow prepayment is due) (subject in each case to reversal to the extent not in fact made during such succeeding
fiscal year or after year end), (ii) required Excess Cash Flow payments shall be reduced on a dollar-for-dollar basis, without
duplication of any deductions to the definition of Excess Cash Flow, for, among other things investments, capital expenditures, certain
restricted payments and permitted acquisitions in each case funded with internally generated cash and not with the proceeds of long
term indebtedness and (iii) no Excess Cash Flow payment shall be required if Excess Cash Flow during such year is equal to or
less than a dollar amount to be agreed; (b) 100% of the net cash proceeds received from the incurrence of indebtedness by the
Borrower or any of its restricted subsidiaries (other than indebtedness permitted under the Bank Facilities Documentation (other
than Refinancing Debt) (to be defined in a manner consistent with the Documentation Principles)) and (c) 100% (with step-downs
to 50% and 0% based upon the achievement of First Lien Leverage Ratios equal to or less than (x) the Closing Date First Lien
Leverage Ratio minus 0.50:1.00 and (y) the Closing Date First Lien Leverage Ratio minus 1.00:1.00, respectively (the “Asset
Sale Sweep Stepdowns”)) (any net cash proceeds not required to prepay the Term Loans due to the operation of the Asset
Sale Sweep Stepdowns, “Retained Asset Sale Proceeds”) of the net cash proceeds of all non-ordinary course
asset sales or other dispositions of Collateral (including insurance and condemnation proceeds) in excess of an amount to be agreed
for each individual asset sale or disposition or series of related asset sales or dispositions and an amount to be agreed in the
aggregate for any fiscal year (with only the amount in excess of such annual limit required to be offered to prepay) and subject
to the right of the Borrower to reinvest such proceeds if such proceeds are reinvested (or committed to be reinvested) within 540
days (the “Reinvestment Date”) and, if so committed to reinvestment, reinvested within 6 months thereafter,
and other exceptions to be agreed upon
Notwithstanding the foregoing, mandatory
prepayments under clauses (a) and (c) above shall be limited to the extent that the Borrower determines that such prepayments
would either (i) result in material adverse tax consequences related to the repatriation of funds in connection therewith by
non-guarantor subsidiaries or (ii) be prohibited or delayed by applicable law.
Mandatory prepayments required under the
Bank Facilities Documentation may, if required pursuant to the terms of any other indebtedness secured pari passu with the Term Loans
(including the Secured Bridge Loans and/or the Senior Secured Notes), be applied to the Term Loans and such other pari passu indebtedness,
in each case on a ratable basis based on the outstanding principal amounts thereof. |
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Within the Term Loan Facility, mandatory prepayments shall
be applied first, to accrued interest and fees due on the amount of the prepayment under the Term Loan Facility and second, directly
to the scheduled installments of principal of the Term Loan Facility in direct order of maturity. |
| [Bank Facilities Term Sheet] | |
|
Any Term Lender may elect not to accept any
mandatory prepayment made pursuant to clauses (a) or (c) above (each a “Declining Lender”). Any
prepayment amount declined (such amount, a “Declined Amount”) by a Declining Lender, subject to any prepayment
requirements of the Notes, the Secured Bridge Facility and/or the Unsecured Bridge Facility, may be retained by the Borrower and
shall be added to the Available Amount Basket (as defined below). |
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Voluntary Prepayments and Reductions in Commitments: |
Voluntary reductions of the unutilized portion
of the Revolving Commitments and prepayments of borrowings under the Bank Facilities will be permitted at any time, in minimum principal
amounts to be agreed upon, without premium (except as set forth in the immediately succeeding paragraph) or penalty, subject to reimbursement
of the Bank Lenders’ redeployment costs estimated to be incurred in the case of a prepayment of Term SOFR borrowings other
than on the last day of the relevant interest period. All voluntary prepayments of the Term Loan Facility and any Incremental Term
Facility will be applied to the remaining amortization payments under the Term Loan Facility or such Incremental Term Facility, as
directed by the Borrower (and absent such direction, in direct order of maturity thereof), including to any class of extending or
existing Loans in such order as the Borrower may designate, and shall be applied to either the Term Loan Facility or any Incremental
Term Facility as determined by the Borrower.
(1) Any voluntary prepayment or refinancing,
in whole or in part (other than a refinancing of the Term Loan Facility in connection with any transaction that would, if consummated,
constitute a change of control, initial public offering, Transformative Acquisition (as defined below) or Transformative Disposition
(as defined below)) of the Term Loan Facility with other broadly syndicated term B loans under credit facilities with a lower Effective
Yield (as defined below) than the Effective Yield of the Term Loan Facility, (2) any amendment (other than an amendment of the
Term Loan Facility in connection with any transaction that would, if consummated, constitute a change of control, initial public
offering, Transformative Acquisition or Transformative Disposition) that reduces the Effective Yield of the Term Loan Facility, or
(3) in the event that a Lender must assign its loans under the Term Loan Facility as a result of its failure to consent to an
amendment, amendment and restatement or other modification (other than any such amendment, amendment and restatement or other modification
in connection with any transaction that would, if consummated, constitute a change of control, initial public offering, Transformative
Acquisition or Transformative Disposition), in any of the foregoing cases, that occurs prior to the 6 month anniversary of the Closing
Date (the “Soft Call Date”) and the primary purpose (as determined by the Borrower in good faith) of which
is to lower the Effective Yield on the Term Loan Facility, shall be subject to a prepayment premium of 1.00% of the principal amount
of the Term Loans so prepaid, refinanced or amended. For the purposes of the foregoing, (i) “Transformative Acquisition”
shall mean any acquisition by the Borrower or any restricted subsidiary that (a) is not permitted by the terms of the Bank Facilities
Documentation immediately prior to the consummation of such acquisition, (b) if permitted by the terms of the Bank Facilities
Documentation immediately prior to the consummation of such acquisition, would not provide the Borrower and the other restricted
subsidiaries with adequate flexibility under the Bank Facilities Documentation for the continuation and/or expansion of their combined
operations following such consummation, as determined by the Borrower acting in good faith or (c) results in a refinancing of
the Term Loan Facility that involves a downsizing in connection with such acquisition, (ii) “Transformative Disposition”
shall mean any disposition by the Borrower or any restricted subsidiary that (a) is not permitted by the terms of the Bank Facilities
Documentation immediately prior to the consummation of such disposition, (b) if permitted by the terms of the Bank Facilities
Documentation immediately prior to the consummation of such disposition, would not provide the Borrower and the other restricted
subsidiaries with a durable capital structure, as determined by the Borrower acting in good faith or (c) results in a refinancing
of the Term Loan Facility that involves an upsizing in connection with such disposition and (iii) “Effective Yield”
shall mean, as of any date of determination, the sum of (x) the higher of (A) the Term SOFR rate on such date for a deposit
in dollars with a maturity of one month and (B) the Term SOFR floor, if any, with respect thereto as of such date, (y) the
interest rate margins as of such date, (with such interest rate margin and interest spreads to be determined by reference to the
Term SOFR rate) and (z) the amount of OID and upfront fees thereon paid generally to lenders (converted to yield assuming a
four-year average life and without any present value discount). |
| [Bank Facilities Term Sheet] | |
Documentation: |
The definitive documentation for the Bank
Facilities (the “Bank Facilities Documentation”) will (i) be “covenant-lite” with incurrence-based
covenants, (ii) contain the terms and conditions set forth in this Exhibit B and in Exhibit E, (iii) be negotiated
in good faith within a reasonable time period to be determined based on the expected Closing Date and be based on a market precedent
for leading private equity sponsors to be agreed between MSSF and the Borrower prior to the launch of general syndication of the
Bank Facilities (the “Documentation Precedent”), (iv) be modified to reflect (x) the operational
and strategic requirements of the Borrower and its subsidiaries in light of their size, industries, businesses and business practices,
locations, operations, financial accounting, and the Projections set forth in the Acquisition Model (as defined below), (y) the
nature of the Transactions and (z) modifications to reflect changes in law since the date of the Documentation Precedent and
the reasonable administrative, agency and operational requirements of the Bank Administrative Agent (including, without limitation,
customary EU/UK Bail-In provisions, erroneous payment provisions, benchmark adjustment provisions and QFC stay provisions, (iv) contain
only those mandatory prepayments, representations, warranties, affirmative, financial and negative covenants and events of default
provided for in this Exhibit B to the Commitment Letter, in each case, applicable to Borrower and the restricted subsidiaries
(and in certain customary cases, Holdings) and with exceptions for materiality or otherwise and “baskets” as set forth
in this Exhibit B (or, if not so specified in this Exhibit B, as agreed by Borrower and MSSF) and (v) provide that
with respect to exceptions and thresholds that are subject to a monetary cap and “baskets” that specify a dollar-denominated
amount, include a “grower” component (a “Grower Component”) regardless of whether any such
exceptions, thresholds or “baskets” specified in this Exhibit B refer to Grower Components based on a percentage
of Consolidated EBITDA, in each case, that is substantially equivalent to the initial monetary cap. Notwithstanding the
foregoing, the only conditions to the availability of the Bank Facilities on the Closing Date shall be the applicable conditions
set forth in Exhibit E to the Commitment Letter. This paragraph is referred to as the “Documentation Principles”. |
| [Bank Facilities Term Sheet] | |
Limited Condition Transaction: |
For purposes of (i) determining compliance
with any provision of the Bank Facilities Documentation which requires the calculation of the First Lien Leverage Ratio, the Total
Leverage Ratio or the Fixed Charge Coverage Ratio (as defined below), (ii) determining compliance with representations, warranties,
defaults or events of default or (iii) testing availability under baskets set forth in the Facilities Documentation (including
baskets measured as a percentage of EBITDA), in each case, in connection with (x) a transaction whose consummation is not conditioned
on the availability of, or on obtaining, third party financing or (y) any redemption, repurchase, defeasance, satisfaction and
discharge or repayment of indebtedness requiring irrevocable notice in advance of such redemption, repurchase, defeasance, satisfaction
and discharge or repayment (any such transaction, a “Limited Condition Transaction”), at the option of
the Borrower (the Borrower’s election to exercise such option in connection with any Limited Condition Transaction, an “LCT
Election”), the date of determination of whether any such action is permitted hereunder, shall be deemed to be the
date the definitive agreements or notice, as applicable, for such Limited Condition Transaction are entered into (the “LCT
Test Date”), and if, after giving pro forma effect to the Limited Condition Transaction and the other transactions
to be entered into in connection therewith as if they had occurred at the beginning of the most recent test period ending prior to
the LCT Test Date, the Borrower could have taken such action on the relevant LCT Test Date in compliance with such ratio or basket,
such ratio or basket shall be deemed to have been complied with.
For the avoidance of doubt, if the Borrower
has made an LCT Election and any of the ratios or baskets for which compliance was determined or tested as of the LCT Test Date are
exceeded as a result of fluctuations in any such ratio or basket (including due to fluctuations of the target of any Limited Condition
Transaction) at or prior to the consummation of the relevant transaction or action, such baskets or ratios will not be deemed to
have been exceeded as a result of such fluctuations. If the Borrower has made an LCT Election for any Limited Condition Transaction,
then in connection with any subsequent calculation of any ratio or basket on or following the relevant LCT Test Date and prior to
the earlier of (i) the date on which such Limited Condition Transaction is consummated or (ii) the date that the definitive
agreement for such Limited Condition Transaction is terminated or expires without consummation of such Limited Condition Transaction,
any such calculation shall be made on a pro forma basis assuming such Limited Condition Transaction and other transactions in connection
therewith (including any incurrence of debt and the use of proceeds thereof) had been consummated. |
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Conditions Precedent to Initial Borrowing: |
The availability of the initial borrowing and other extensions
of credit under the Bank Facilities on the Closing Date will be subject solely to the applicable conditions set forth in Exhibit E
to the Commitment Letter. |
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Conditions Precedent to All Subsequent Borrowings: |
After the Closing Date, each extension of credit (except
in connection with certain incurrences under any Incremental Facilities or refinancing facility, which shall be subject to applicable
terms as set forth herein or otherwise consistent with the Documentation Principles) will be conditioned upon: (a) delivery
of a borrowing notice, (b) accuracy of representations and warranties in all material respects (provided that any such
representations and warranties which are qualified by materiality, material adverse effect or similar language shall be true and
correct in all respects) and (c) absence of defaults or events of default, subject to, in the case of clauses (b) and (c),
the limitations set forth in the section entitled “Limited Condition Transaction” hereof to the extent the proceeds of
any extension of credit is being used to finance a Limited Condition Transaction. |
| [Bank Facilities Term Sheet] | |
Representations and Warranties: |
Limited to the following (to be applicable
to Holdings (where applicable consistent with the Documentation Principles), Borrower and its restricted subsidiaries): organizational
status; power and authority, qualification, execution, delivery and enforceability of the Facilities Documentation; with respect
to the execution, delivery and performance of the Facilities Documentation, no violation of, or conflict with, law, charter documents
or material agreements; litigation; margin regulations; material governmental approvals with respect to the execution, delivery and
performance of the Facilities; Investment Company Act; PATRIOT Act; to the knowledge of the Borrower, accuracy of the Beneficial
Ownership Certification as of the Closing Date in all material respects; accuracy of disclosure and financial statements; since the
Closing Date, no material adverse effect (to be defined in a manner consistent with the Documentation Principles); taxes; compliance
with laws; OFAC, FCPA, anti-bribery and corruption, sanctions and anti-money laundering laws; ERISA; subsidiaries; intellectual property;
creation, validity and perfection of security interests; environmental laws; properties; consolidated closing date solvency; subject,
in the case of each of the foregoing representations and warranties, to qualifications and limitations for materiality consistent
with the Documentation Principles. |
|
|
Affirmative Covenants: |
Limited to the following (to be applicable to Holdings
(where applicable consistent with the Documentation Principles), the Borrower and its restricted subsidiaries): delivery
of annual and quarterly financial statements (with 120 days for delivery of annual financial statements and 45 days for quarterly
financials (with extended time periods of 135 days for delivery of the first annual and 60 days for delivery of the first three quarterly
financial statements, in each case, to be delivered after the Closing Date)), and with annual financial statements to be accompanied
by an audit opinion from nationally recognized auditors that is not subject to qualification as to “going concern” or
the scope of such audit (other than solely with respect to, or resulting solely from (i) an upcoming maturity date under any
debt, (ii) any actual or potential inability to satisfy any financial maintenance covenant on a future date or in a future period
or (iii) the activities, operations, financial results, assets or liabilities of any unrestricted subsidiary); delivery of notices
of defaults and certain material events; at the request of the Administrative Agent (or any Lender through the Administrative Agent),
delivery of KYC information (including beneficial ownership certificates); inspections (including books and records and subject to
frequency (so long as there is no ongoing event of default) and cost reimbursement limitations); prior to an IPO, annual budget reports
in the form customarily prepared by the Borrower (or otherwise as provided to its equity holders) (with delivery time periods to
be consistent with the delivery requirements for the audited annual financial statements); officers’ compliance certificates
and other information reasonably requested by the Administrative Agents; maintenance of organizational existence and rights and privileges;
maintenance of insurance (but not, for the avoidance of doubt, flood insurance except to the extent required by applicable law);
commercially reasonable efforts to maintain ratings (but not to maintain a specific rating); payment of taxes; compliance with laws
(including environmental laws and OFAC); ERISA; transactions with affiliates; changes in fiscal year; additional guarantors and collateral;
use of proceeds; changes in lines of business; and further assurances on collateral matters; subject, in the case of each of the
foregoing covenants, to exceptions and qualifications consistent with the Documentation Principles. |
| [Bank Facilities Term Sheet] | |
Negative Covenants: |
Limited to (to be applicable to the Borrower
and its restricted subsidiaries and, with respect to the passive holdings covenant, Holdings): limitations on the incurrence of debt
(provided that (w) debt may be incurred if, after giving effect thereto, either (i) the Fixed Charge Coverage Ratio (defined
in a manner consistent with the Documentation Principles) (the “Fixed Charge Coverage Ratio”) would be
at least 2.00:1.00 or (ii) the Total Leverage Ratio would be not greater than the Total Leverage Ratio as of the Closing Date
(this clause (ii), the “Total Leverage Ratio Prong”), with a sublimit to be agreed for non-Guarantor
Subsidiaries (this clause (w), “Ratio Debt”), (x) there shall be separate general debt basket with
a sublimit on non-guarantors to be agreed and (y) there shall be a subsidiary debt basket for non-Guarantor subsidiaries in
an amount to be agreed, which, in the case of secured debt, may be secured by assets of non-Guarantor subsidiaries); liens (with
exceptions to allow (i) liens on Collateral, if such liens are subject to a customary intercreditor that will be attached to
the Bank Facilities Documentation as an exhibit, and rank junior to the liens on such Collateral in relation to the liens securing
the Facilities and the Guarantees subject to limitations consistent with the Documentation Principles, as applicable (this clause
(i), the “Junior Lien Exception”), (ii) liens securing indebtedness referenced in clauses (x),
(y) and (z) above and (iii) for a general lien basket in an amount equal to the general debt basket
which may, at the election of the Borrower, be secured on a junior lien basis with the obligations under each of the Facilities,
subject to a customary intercreditor agreement); fundamental changes; restrictions on subsidiary distributions and negative pledge
clauses; asset sales (which shall be permitted subject to either (A) (i) a 75% aggregate cash consideration requirement
for dispositions in excess of an amount to be agreed (with the ability to designate certain non-cash assets as cash), (ii) a
fair market value requirement, and (iii) a requirement that the proceeds of asset sales be applied in accordance with “Mandatory
Prepayments” or (B) (i) a 50% aggregate cash consideration requirement for dispositions in excess of an amount to
be agreed (with the ability to designate certain non-cash assets as cash), (ii) a fair market value requirement, (iii) a
requirement that the proceeds of asset sales be applied in accordance with “Mandatory Prepayments”; provided that there
shall be no reinvestment rights if relying on this clause (B)); passive holding company; and restricted payments (including investments
and repurchases and redemptions of debt subordinated by its terms (“Subordinated Debt”)) (which shall allow
for (i) separate baskets for each of dividends subject to no event of default, investments (including a general basket, an investment
in unrestricted subsidiaries basket and investments in similar businesses basket) and repurchases of Subordinated Debt subject to
no event of default in each case in amounts to be agreed, (ii) distributions in connection with IPO reorganization transactions
(on terms consistent with the Documentation Principles), (iii) Permitted IPO Distributions (as defined below), (iv) unlimited
redemptions of Subordinated Debt subject to compliance with a pro forma Total Leverage Ratio of 0.75:1.00 less than the Total Leverage
Ratio as of the Closing Date (the “Subordinated Debt Restricted Payment Ratio”) and no event of default,
(v) customary permitted tax distributions, (vi) unlimited restricted payments subject to compliance with a pro forma Total
Leverage Ratio of 1.00:1.00 less than the Total Leverage Ratio as of the Closing Date (the “General Restricted Payment
Ratio”) and no event of default; (vii) unlimited investments among the Borrower and its restricted subsidiaries
and (viii) the acquisition, repurchase or redemption of equity interests held by current or former officers, directors, employees
or consultants not to exceed the greater of (x) an amount to be agreed and (y) the corresponding percentage of EBITDA in
any calendar year (with unused portions of such basket rolling forward to succeeding years) and (x) unlimited investments subject
to pro forma compliance with a pro forma Total Leverage Ratio of 0.50:1.00 less than the Total Leverage Ratio as of the Closing Date
(the “Investment Restricted Payment Ratio”) and no payment or bankruptcy event of default; subject, in
the case of each of the foregoing covenants, to exceptions, qualifications and, as appropriate, baskets (including each basket grown
based off of the EBITDA of the Borrower and its restricted subsidiaries) to be agreed upon consistent with the Documentation Principles. |
| [Bank Facilities Term Sheet] | |
|
The Borrower or any restricted subsidiary
will be permitted:
(a)
to incur Incremental Equivalent Debt;
(b) to
incur indebtedness to finance an acquisition so long as, (x) in the case of unsecured debt, (i) the Fixed Charge Coverage
Ratio (calculated on a pro forma basis) shall either be (A) greater than or equal to the Fixed Charge Coverage Ratio immediately
prior to such transactions (the “Accretive FCCR Prong”) or (B) at least 2.00:1.00, in either case,
recomputed as of the last day of the most recently ended fiscal quarter of the Company for which financial statements are available
or (ii) the Total Leverage Ratio (calculated on a pro forma basis) shall either be (A) less than or equal to the Total
Leverage Ratio immediately prior to such transactions or (B) less than or equal to the Closing Date Total Leverage Ratio (this
clause (ii), the “Acquisition Debt Total Leverage Ratio Prong”), (y) in the case of indebtedness secured
on a junior basis to the Bank Facilities, the Total Leverage Ratio (calculated on a pro forma basis) shall either be (A) less
than or equal to the Total Leverage Ratio immediately prior to such transactions or (B) less than or equal to the Closing Date
Total Leverage Ratio or (z) in the case of indebtedness secured on an equal priority basis with the Bank Facilities, the First
Lien Leverage Ratio (calculated on a pro forma basis) shall either be (A) less than or equal to the First Lien Leverage Ratio
immediately prior to such transactions or (B) less than or equal to the Closing Date First Lien Leverage Ratio, in each case,
recomputed as of the last day of the most recently ended fiscal quarter of the Company for which financial statements have been delivered;
provided that, in each case, there will be a sublimit to be agreed for non-Subsidiary Guarantors (the debt incurred pursuant to this
clause (b), “Acquisition Debt”);
(c) to incur indebtedness, consummate
fundamental changes, make distributions, sell assets and make restricted payments (including investments), in each case, among the
Borrower, the Guarantors and their restricted subsidiaries, in each case, on terms and conditions consistent with those in the Documentation
Principles;
(d) settle, redeem or repurchase (1) all
obligations with respect to the 0.25% Convertible Senior Notes due 2024 issued pursuant to that certain Indenture, dated June 11,
2018, among the Company, as issuer, and U.S. Bank National Association, as trustee in accordance with its terms, (2) all obligations
with respect to the 0.375% Convertible Senior Notes due 2025 issued pursuant to that certain Indenture, dated March 12, 2020,
among the Company, as issuer, and U.S. Bank National Association, as trustee in accordance with its terms and (3) all obligations
with respect to the 0% Convertible Senior Notes due 2026 issued pursuant to that certain Indenture, dated March 4, 2021, among
the Company, as issuer, and U.S. Bank National Association, as trustee in accordance with its terms; in each case, so long as the
Borrower has or its restricted subsidiaries has segregated the cash for such settlement, redemption or repurchase on the Closing
Date until the date of such settlement, redemption or repurchase; and |
| [Bank Facilities Term Sheet] | |
|
(e) consummate the Transactions.
“Permitted
IPO Distributions” shall mean after a qualified IPO (which shall be defined
in a customary manner to include any initial public offering or other transaction which results
in a controlling parent company of the Borrower being publicly traded), restricted payments
in an aggregate amount per annum not to exceed the greater of (a) an aggregate amount
per annum not to exceed 6% of the aggregate net proceeds received by (or contributed to)
the Borrower and its restricted subsidiaries from such qualified IPO and (b) an aggregate
amount per annum not to exceed 7% of market capitalization.
In addition,
the restricted payment covenant shall include an “Available Amount Basket”,
which shall mean a cumulative amount equal to (a) the greater of (x) $850.0 million
and (y) 50% of trailing twelve month EBITDA (this clause (y), the “Available
Amount EBITDA Grower”) plus (b) at the election of the Borrower prior
to the launch of general syndication of the Facilities, (i) 50% of Consolidated Net
Income (defined in a manner consistent with the Documentation Precedent) or, in the case
of Consolidated Net Income for such period is a deficit, minus 100% of such deficit, (ii) retained
Excess Cash Flow, commencing with the first full fiscal quarter for which financial statements
are available after the Closing Date, which will accumulate on a quarterly basis (or, in
the case of retained Excess Cash Flow (defined in a manner consistent with the Documentation
Precedent), on an annual basis, commencing for the first full fiscal year after the Closing
Date) or (iii) trailing twelve month EBITDA less 1.50x Fixed Charges (defined in a manner
consistent with the Documentation Precedent), plus, in each of the following clauses (c) through
(i), without duplication, (c) the cash proceeds of new public or private equity
issuances of any parent of the Borrower or the Borrower (other than disqualified stock) to
the extent the proceeds thereof are contributed to the Borrower as qualified equity and are
not a Specified Equity Contribution, plus (d) after the Closing Date, capital contributions
to the Borrower made in cash, cash equivalents or other property (other than disqualified
stock) that are not a Specified Equity Contribution, plus (e) the net cash proceeds
received by the Borrower from debt and disqualified stock issuances that have been issued
after the Closing Date and which have been exchanged or converted into qualified equity,
plus (f) the net cash proceeds received by the Borrower and its restricted subsidiaries
from sales of investments made using the Available Amount Basket (and not in excess of the
amount of such original investment), plus (g) returns, profits, distributions and similar
amounts received by the Borrower and its restricted subsidiaries on investments made using
the Available Amount Basket (and not in excess of the amount of such original investment),
plus (h) the investments of the Borrower and its restricted subsidiaries in any unrestricted
subsidiary so designated using the Available Amount Basket that has been re-designated as
a restricted subsidiary or that has been merged or consolidated with or into the Borrower
or any of its restricted subsidiaries (not in excess of the original investments or in respect
of permitted investments) plus (i) Declined Amounts and Retained Asset Sale Proceeds
plus; provided that use of the Available Amount Basket (other than the amount of the
Available Amount Basket attributable to clauses (a), (c), (d), (e) and
(i) above) for (x) dividends and distributions in respect of capital stock
of the Borrower (or any of its direct or indirect parent companies) and stock repurchases,
shall in each case be subject to the absence of any Event of Default, (y) the prepayment,
purchase or redemption of Subordinated Debt, shall in each case be subject to the absence
of any Event of Default and (z) investments, shall be subject to the absence of any
payment or bankruptcy Event of Default (the usages referenced in this proviso, the “Limited
Available Amount Usages”). |
| [Bank Facilities Term Sheet] | |
Financial Covenants: |
With respect to the Term Loan Facility: None.
With respect to the Revolving Facility: Limited
to a maximum First Lien Leverage Ratio covenant which shall be set based on a 40% cushion to the Acquisition Model (with no step
downs) (the “Financial Covenant”).
The Financial Covenant shall be tested only
in the event that on the last day of any fiscal quarter of Holdings (commencing with the second full fiscal quarter of Holdings ending
after the Closing Date) the aggregate revolving credit exposure (excluding (i) cash collateralized Letters of Credit and additional
issued and undrawn Letters of Credit up to a cap to be agreed and (ii) for the first four quarters for which the Financial Covenant
could be tested after the Closing Date only, Revolving Loans borrowed on the Closing Date) under the Revolving Facility exceeds 35%
of the aggregate commitments under the Revolving Facility.
For purposes of determining compliance with
the Financial Covenant, any cash equity contribution (which shall be common equity or otherwise in a form reasonably acceptable to
the First Lien Administrative Agent) made to the Borrower after the beginning of the most recently ended fiscal quarter and on or
prior to the day that is 10 business days after the day on which financial statements are required to be delivered for such fiscal
quarter will, at the request of the Borrower, be included in the calculation of EBITDA solely for the purposes of determining compliance
with such Financial Covenant at the end of such fiscal quarter and applicable subsequent periods which include such fiscal quarter
(any such equity contribution so included in the calculation of EBITDA, a “Specified Equity Contribution”);
provided that, (a) there shall be no more than two quarters in each four consecutive fiscal quarter period in respect
of which a Specified Equity Contribution is made, (b) the amount of any Specified Equity Contribution shall be no more than
the amount required to cause the Borrower to be in pro forma compliance with the Financial Covenant specified above, (c) no
more than five Specified Equity Contributions shall be made during the term of the First Lien Facilities, (d) all Specified
Equity Contributions shall be disregarded for purposes of any financial ratio determination under the Facilities Documentation other
than for determining compliance with the Financial Covenant (and will not be credited as an addition to the applicable restricted
payments build-up provisions or for any other negative covenant exception) and (e) there shall be no pro forma or other reduction
in indebtedness with the proceeds of any Specified Equity Contribution for determining compliance with the Financial Covenant unless
such proceeds are actually applied to prepay indebtedness under the Facilities prior to the end of the applicable fiscal period. |
| [Bank Facilities Term Sheet] | |
|
“EBITDA” shall
be defined in a manner consistent with the Documentation Principles and in any event shall include, without limitation, add backs,
deductions and adjustments, as applicable, without duplication, for (a) non-cash items, (b) extraordinary, unusual or non-recurring
items, (c) restructuring charges and related charges, (d) pro forma adjustments, pro forma cost savings, operating expense
reductions, operating enhancements and cost synergies, in each case, related to mergers and other business combinations, acquisitions,
divestitures and other initiatives (including in respect of the pro forma adjustments and addbacks set forth in clause (c) above)
consummated by the Borrower and projected by the Borrower in good faith to result from actions taken or expected to be taken (in
the good faith determination of the Borrower) within eight fiscal quarters after the date any such transaction is consummated, (e) “run
rate” cost savings, operating expense reductions, operating enhancements and synergies projected by the Borrower in good faith
to result from actions either taken or expected to be taken within 24 months after the date of determination to take such action,
so long as such cash savings and synergies are reasonably identifiable and factually supportable, (f) certain adjustments and
addbacks in the Existing Credit Agreement and the Documentation Principles, (g) adjustments and add backs reflected in either
(i) the Investors’ financial model as agreed by the Lead Arrangers (the “Acquisition Model”)
or (ii) the management presentation and confidential information memorandum to be provided by the Company as agreed to by the
Lead Arrangers and (h) other adjustments and add backs to be agreed.
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Events of Default: |
Limited to the following (to be applicable
to Holdings, the Borrower and its restricted subsidiaries): nonpayment of principal, interest or other amounts; violation of covenants;
incorrectness of representations and warranties in any material respect (subject to a thirty day grace period in the case of misrepresentations
that are capable of being cured); cross default and cross acceleration to material indebtedness (provided that a breach of the Revolving
Facility Financial Covenant will not constitute an event of default with respect to the Term Loan Facility until the date on which
the Revolving Loans and/or the Revolving Commitments have been accelerated or terminated, respectively, by a vote of the Revolving
Lenders holding more than 50% of the aggregate amount of loans and unused commitments under the Revolving Facility (other than Defaulting
Lenders) (the “Required Revolving Lenders”)); bankruptcy and insolvency of Holdings, the Borrower or any
of its significant restricted subsidiaries; material monetary judgments; ERISA events; actual or asserted invalidity of material
guarantees or security documents; and change of control (with no continuing director prong), subject to thresholds (with growth components
based off of EBITDA), notice and grace period provisions consistent with the Documentation Principles.
In addition, in the event that the Acquisition
is consummated via the Tender Offer, it shall be an immediate event of default (with no grace period) if the Company and the other
subsidiaries of the Company that are required to become Guarantors shall not become Guarantors or grant the requisite liens in their
assets within five (5) business days after the Closing Date (or such longer period as may be agreed by the Bank Administrative
Agent, in its sole discretion).
Notwithstanding the foregoing, (x) only
Revolving Lenders holding at least a majority of the Revolving Commitments and Revolving Loans shall have the ability to (and be
required in order to) amend the Financial Covenant and waive a breach of the Financial Covenant, and (y) a breach of the Financial
Covenant shall not constitute an Event of Default with respect to the Term Loan Facility or trigger a cross-default under the Term
Loan Facility until the date on which the Revolving Loans (if any) have been accelerated or the Revolving Commitments have been terminated,
in each case, by the Revolving Lenders in accordance with the terms of the Revolving Facility. |
| [Bank Facilities Term Sheet] | |
Voting: |
Amendments and waivers of the Bank Facilities Documentation will require the approval of Bank Lenders (other than Defaulting Lenders) holding more than 50% of the aggregate amount of the loans and unused commitments under the Bank Facilities held by the Bank Lenders (other than Defaulting Lenders) (the “Required Lenders”), except that (i) the consent of each Bank Lender directly and adversely affected thereby shall be required with respect to: (A) increases in the commitment of such Bank Lender, (B) reductions of principal, interest or fees owing to such Bank Lender, (C) extensions or postponement of final maturity or the scheduled date of payment of any principal, interest or fees, (D) releases of all or substantially all the value of the Guarantees or releases of liens on all or substantially all of the Collateral and (E) modifications to the pro rata sharing provisions, payments waterfall or any other provisions of the Bank Facilities Documentation that would have the effect of subordinating the claims of the Bank Lenders or the liens supporting the Obligations, (ii) the consent of 100% of the Bank Lenders will be required with respect to modifications to any of the voting percentages that result in a decrease of voting rights for Bank Lenders and (iii) customary protections for the Issuing Lenders and the Bank Administrative Agent will be provided. The Bank Facilities Documentation shall include customary restrictions on “net-short” Lenders’ voting rights which (x) shall only apply to voting in rights in respect of the Term Loans and (y) for the avoidance of doubt, shall exclude regulated financial institutions that are Revolving Lenders (and their affiliates) as of the Closing Date.
Notwithstanding the foregoing, amendments and waivers of the Financial Covenant will be subject to the second paragraph under “Events of Default” above. |
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The Bank Facilities Documentation shall contain provisions permitting the Borrower to replace (i) non-consenting Term Loan Lenders in connection with amendments and waivers requiring the consent of all such class of Bank Lenders or of all such class of Bank Lenders directly affected thereby so long as the Required Lenders shall have consented thereto and (ii) Defaulting Lenders. The Bank Facilities Documentation shall also contain usual and customary provisions regarding Defaulting Lenders. |
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Cost and Yield Protection: |
Usual for facilities and transactions of this type, with provisions protecting the Lenders from withholding tax liabilities in form and substance reasonably satisfactory to the Borrower and the Bank Administrative Agent and subject to customary exceptions; provided that requests for additional payments due to increased costs from market disruption shall be limited to circumstances generally affecting the banking market and when (x) Term Loan Lenders holding a majority of the Term Loans or (y) the Required Revolving Lenders, as applicable, have made such a request; provided further, that protection for increased costs imposed as a result of rules enacted or promulgated under the Dodd-Frank Act or Basel III after the date of the Bank Facilities Documentation shall be included (but solely for such costs that would have been included if they had been otherwise imposed under the applicable increased cost provisions and only to the extent the applicable Lender is imposing such charges on other similarly situated borrowers under comparable syndicated credit facilities). The Bank Facilities Documentation shall contain provisions regarding the timing for asserting a claim under these provisions and permitting the Borrower to replace a Bank Lender who asserts such claim without premium or penalty. |
| [Bank Facilities Term Sheet] | |
Assignments and Participations: |
The Bank Lenders will be permitted to assign
(a) Term Loans with the consent of the Borrower (not to be unreasonably withheld or delayed) and (b) Revolving Commitments
with the consent of the Borrower (not to be unreasonably withheld or delayed), and each Issuing Lender and Swingline Lender; provided
that (i) no consent of the Borrower shall be required after the occurrence and during the continuance of an Event of Default,
(ii) no consent of the Borrower shall be required for assignments of Term Loans to any existing Bank Lender or an affiliate
of an existing Bank Lender or an approved fund, (iii) no consent of the Borrower shall be required for assignments of Revolving
Commitments to any existing Revolving Lender or an affiliate of an existing Revolving Lender or (iv) with respect to Term Loans
only, no consent of the Borrower shall be required unless the Borrower has already objected thereto by delivering written notice
to the applicable Administrative Agent within 10 business days after the receipt of a request for consent thereto. All
assignments of Term Loans, Revolving Loans and Revolving Commitments will require the consent of the Bank Administrative Agent unless
such assignment is an assignment of Term Loans to another Term Lender, an affiliate of a Term Lender or an approved fund, such consent
not to be unreasonably withheld or delayed. Assignments to natural persons shall be prohibited. Each assignment
will be in an amount of an integral multiple of $1.0 million with respect to the Term Loan Facility and $5.0 million with respect
to the Revolving Facility or, in each case, if less, all of such Bank Lender’s remaining loans and commitments of the applicable
class. Assignments will not be required to be pro rata among the Bank Facilities. |
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The Bank Lenders will be permitted to sell participations
in the Bank Facilities without restriction, other than as set forth in the next sentence, and in accordance with applicable law. Voting
rights of participants shall be limited to matters in respect of (a) increases in commitments participated to such participants,
(b) reductions of principal, interest or fees, (c) extensions of final maturity or the scheduled date of payment of any
principal, interest or fees and (d) releases of all or substantially all of the value of the Guarantees or all or substantially
all of the Collateral. |
| [Bank Facilities Term Sheet] | |
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The Bank Facilities Documentation shall provide that, subject to the absence of a continuing event of default or an event of default resulting therefrom (a) Term Loans may be purchased and assigned on a non-pro rata basis through (i) open market purchases and (ii) loan buy-backs or similar procedures to be agreed that are offered to all Lenders on a pro rata basis in accordance with customary procedures to be agreed and subject to customary restrictions to be agreed and (b) the Investors, the Borrower and any other affiliates of the Borrower shall be eligible assignees with respect to Term Loans only; provided that (i) any such Term Loans acquired by the Borrower or any of its respective subsidiaries shall be retired and cancelled promptly upon acquisition thereof (or contribution thereto, including as contemplated by the following clause (ii)) and (ii) any such Term Loans acquired by the Investors, Holdings or any of their affiliates may, with the consent of the Borrower, be contributed to the Borrower (whether through any of its direct or indirect parent entities or otherwise) and exchanged for debt or equity securities of such parent entity or the Borrower that are otherwise permitted to be issued by such entity at such time. Assignments of Term Loans to the Investors and their respective affiliates (other than any such affiliate that is a bona fide debt fund or entity that extends credit or buys loans in the ordinary course of business (“Affiliated Debt Fund”)) (each, an “Affiliated Lender”) shall be permitted subject only to the following limitations:
(i) Affiliated Lenders will not receive information provided solely to Term Loan Lenders and will not be permitted to attend/participate in Term Lender meetings or receive any advice of counsel to the Administrative Agent or other Lenders and will not be permitted to challenge the Administrative Agent’s or the other Lenders’ attorney-client privilege on the basis of the Affiliated Lenders’ status as Lenders;
(ii) the Affiliated Lenders shall have no right to vote any of its interest under the Term Loan Facility (such interest will be deemed voted in the same proportion as non-affiliated Term Loan Lenders voting on such matter) except that each Affiliated Lender shall have the right to vote on any amendment, modification, waiver or consent that would require the vote of all Term Loan Lenders or the vote of all Term Loan Lenders directly and adversely affected thereby and no amendment, modification, waiver or consent shall affect any Affiliated Lender (in its capacity as a Term Lender) in a manner that is disproportionate to the effect on any Term Lender of the same class or that would deprive such Affiliated Lender of its pro rata share of any payments to which Term Loan Lenders are entitled; and |
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(iii) the amount of Term Loans or loans under any Incremental Term Facility purchased by Affiliated Lenders may not exceed 30% of the aggregate outstanding amount of Term Loans at any time (determined as of the time of such purchase). |
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Expenses and Indemnification: |
The Borrower shall pay, if the Closing Date occurs, all reasonable and documented out-of-pocket expenses of the Bank Administrative Agent and the Commitment Parties (without duplication) in connection with the syndication of the Bank Facilities and the preparation, execution, delivery, administration, amendment, waiver or modification and enforcement of the Bank Facilities Documentation (including the reasonable fees and expenses of counsel identified herein and of a single firm of local counsel in each appropriate jurisdiction (other than any allocated costs of in-house counsel) or otherwise retained with the Borrower’s consent (such consent not to be unreasonably withheld or delayed)). |
| [Bank Facilities Term Sheet] | |
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The Borrower will indemnify and hold harmless the Bank Lead Arrangers, the Bank Administrative Agent, the Commitment Parties and the Bank Lenders (without duplication) and their respective affiliates, and the officers, directors, employees, agents, controlling persons, members, advisors and the successors and permitted assigns of the foregoing (each, an “Indemnified Person”) from and against any and all out-of-pocket expenses, losses, claims, damages and liabilities of any kind or nature (regardless of whether any such Indemnified Person is a party thereto and whether any such proceeding is brought by the Borrower or any other person) and reasonable and documented out-of-pocket fees and expenses incurred in connection with investigating or defending any of the foregoing by one firm of counsel for all Indemnified Persons, taken as a whole, and, if necessary, by a single firm of local counsel in each appropriate jurisdiction for all such Indemnified Persons, taken as a whole (and, in the case of an actual or perceived conflict of interest where the Indemnified Person affected by such conflict notifies you of the existence of such conflict and thereafter, after receipt of your consent (which consent shall not be unreasonably withheld or delayed), retains its own counsel, by another firm of counsel for such affected Indemnified Person) of any such Indemnified Person arising out of or relating to any claim, litigation, investigation or other proceeding (including any inquiry or investigation of the foregoing) (regardless of whether such Indemnified Person is a party thereto or whether or not such action, claim, litigation or proceeding was brought by the Borrower, its equity holders, affiliates or creditors or any other third person) that relates to the Transactions, including the financing contemplated hereby; provided that no Indemnified Person will be indemnified for any out-of-pocket expenses, losses, claims, damages, liabilities or related expenses to the extent that they have resulted from (i) the willful misconduct, bad faith or gross negligence of such Indemnified Person or any of such Indemnified Person’s affiliates or any of its or their respective officers, directors, employees, agents, controlling persons, members, advisors or the successors and permitted assigns of any of the foregoing (as determined by a court of competent jurisdiction in a final and non-appealable decision), (ii) a material breach of the obligations of such Indemnified Person or any of such Indemnified Person ‘s affiliates or any of the officers, directors, employees, advisors, agents or other representatives of any of the foregoing (as determined by a court of competent jurisdiction in a final and non-appealable decision), (iii) in the case of any claim, litigation, investigation or other proceeding brought by a Credit Party or one of its permitted assignees against the relevant Indemnified Person, a material breach of the obligations of such Indemnified Person or any of such Indemnified Person affiliates or any of its or their respective officers, directors, employees, agents, advisors or other representatives of any of the foregoing (as determined by a court of competent jurisdiction in a final and non-appealable decision) or (iv) any claim, litigation, investigation or other proceeding not arising from any act or omission by the Borrower or its affiliates that is brought by an Indemnified Person against any other Indemnified Person (other than disputes involving claims against any Bank Lead Arranger, Bank Administrative Agent, Swingline Lender or Issuing Bank in their capacity as such). No party to the Bank Facilities Documentation shall be liable for any special, indirect, consequential or punitive damages in connection with the Bank Facilities, the Bank Facilities Documentation or its activities related thereto; provided that nothing contained in this sentence will limit the Borrower’s indemnity and reimbursement obligations set forth in this section. |
| [Bank Facilities Term Sheet] | |
Governing Law and Forum: |
New York; provided that (a) to the extent the Acquisition is consummated pursuant to the Acquisition Agreement, the laws of the State set forth in the Acquisition Agreement shall govern in determining (i) whether a material adverse effect under the Acquisition Agreement has occurred, (ii) the accuracy of any Company Representation and whether you (or any of your subsidiaries or affiliates) have the right to terminate your (or their) obligations under the Acquisition Agreement or decline to consummate the Acquisition as a result of a breach of such representations in the Acquisition Agreement and (iii) whether the Acquisition has been consummated in accordance with the terms of the Acquisition Agreement and (b) to the extent the Acquisition is consummated pursuant to the Tender Offer, the federal securities laws of the United States shall govern in determining whether the Initial Offer to Purchase has been consummated in accordance with the terms and conditions thereof. |
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Counsel to the Bank Lead Arrangers and the Bank Administrative Agent: |
Davis Polk & Wardwell LLP. |
| [Bank Facilities Term Sheet] | |
ANNEX I to
EXHIBIT B
Interest Rates: |
The interest rates under the Bank Facilities
will be as follows: |
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Term Loan Facility
At the option of the Borrower, initially,
Term SOFR plus 4.75% or ABR plus 3.75%.
Revolving Facility
At the option of the Borrower, initially,
Term SOFR plus 4.50% or ABR plus 3.50%.
From and after the delivery by the Borrower
to the Bank Administrative Agent of financial statements for the period ending at least one full fiscal quarter following the Closing
Date, the applicable margins under the Revolving Facility shall be subject to step-downs to (A) Term SOFR plus 4.25% or ABR
plus 3.25% or (B) Term SOFR plus 4.00% or ABR plus 3.00%, as applicable, based upon achievement of a First Lien Leverage Ratio
of 0.50:1.00 less than the Closing Date First Lien Leverage Ratio or 1.00:1.00 less than the Closing Date First Lien Leverage Ratio,
respectively.
All Facilities |
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The Borrower may elect interest periods of 1, 3 or 6 months
for Term SOFR borrowings. |
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Calculation of interest shall be on the basis of the actual
days elapsed in a year of 360 days (or 365 or 366 days, as the case may be, in the case of ABR loans based on the Prime Rate) and
interest shall be payable at the end of each interest period and, in any event, at least every 3 months and on the applicable maturity
date. |
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ABR is the highest of (i) the rate of interest publicly
announced by the Bank Administrative Agent as its prime rate in effect at its principal office in New York City (the “Prime
Rate”), (ii) the federal funds effective rate from time to time (which, if negative, shall be deemed to be 0.00%)
plus 0.50% and (iii) Term SOFR applicable for an interest period of one month plus 1.00%. |
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“Term SOFR” means
the greater of (i) the rate per annum equal to the Term SOFR Screen Rate two U.S. Government Securities Business Days
prior to the commencement of such interest period with a term equivalent to such interest period; provided, that, if
the rate is not published prior to 11:00 a.m. on such determination date then Term SOFR means the Term SOFR Screen Rate on the
first U.S. Government Securities Business Day immediately prior thereto and (ii) (x) with respect to the Revolving Facility,
0.00% and (y) with respect to the Term Loan Facility, 0.50%.
“Term SOFR Screen Rate”
means the forward-looking SOFR term rate administered by CME Group Benchmark Administration Limited (or any successor administrator
reasonably satisfactory to the Bank Administrative Agent) and published on the applicable Reuters screen page (or such other
commercially available source providing such quotations as may be designated by the Bank Administrative Agent from time to time).
“U.S. Government Securities Business
Day” means any Business Day, except any Business Day on which any of the Securities Industry and Financial Markets
Association, the New York Stock Exchange or the Federal Reserve Bank of New York is not open for business because such day is a legal
holiday under the federal laws of the United States or the laws of the State of New York, as applicable. |
| [Secured Bridge Facility Term Sheet] | |
Revolving Commitment Fees: |
Initially, 0.50% per annum on the undrawn portion of the Revolving Commitments, payable to non-Defaulting Lenders quarterly in arrears after the Closing Date and upon the termination of the Revolving Commitments, calculated based on the number of days elapsed in a 360-day year.
From and after the delivery by the Borrower to the Bank Administrative Agent of financial statements for the period ending at least one full fiscal quarter following the Closing Date, the commitment fees under the Revolving Facility shall be subject to step-downs to 0.375% and 0.25% based upon achievement of a First Lien Leverage Ratio of 0.50:1.00 less than the Closing Date First Lien Leverage Ratio or 1.00:1.00 less than the Closing Date First Lien Leverage Ratio, respectively. |
| [Bank Facilities Term Sheet] | |
EXHIBIT C
Project X
$3,000.0 million Senior Secured Increasing Rate Secured Bridge Loans
Summary of Principal Terms and Conditions
All capitalized terms used but not defined
herein shall have the meanings given to them in the Commitment Letter to which this term sheet is attached, including Exhibit A
thereto.
Borrower: |
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The Borrower under the Bank Facilities (the “Borrower”). |
Transactions: |
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As set forth in Exhibit A to the Commitment Letter. |
Secured Bridge Administrative Agent: |
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MSSF or an affiliate thereof will act as the sole and exclusive administrative agent (in such capacity, the “Secured Bridge Administrative Agent”) for a syndicate of banks, financial institutions and other institutional lenders and investors reasonably acceptable to the Secured Bridge Lead Arrangers (as defined below) and the Borrower, excluding any Disqualified Lender (together with the Initial Secured Bridge Lenders, the “Secured Bridge Lenders”), and will perform the duties customarily associated with such role. |
Secured Bridge Lead Arrangers: |
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Each of MSSF, BofA Securities, Barclays, MUFG, BNPP Securities, Mizuho and SocGen will act as a lead arranger and joint bookrunner (together with any additional joint bookrunner appointed pursuant to the Commitment Letter, each in such capacity, a “Secured Bridge Lead Arranger”) and will perform the duties customarily associated with such roles. |
Syndication Agent, Documentation Agent or Co-Documentation Agents: |
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The Borrower may designate additional financial institutions reasonably acceptable to the Majority Lead Arrangers (such consent not to be unreasonably withheld, delayed or conditioned) to act as syndication agent, documentation agent or co-documentation agent as provided in the Commitment Letter. |
Senior Secured Bridge Loans: |
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The Secured Bridge Lenders will make senior Secured increasing rate loans (the “Secured Bridge Loans”) to the Borrower on the Closing Date in an aggregate principal amount of up to $3,000.0 million plus, at the Borrower’s election, an amount sufficient to fund any OID or upfront fees required to be funded on the Closing Date in connection with the issuance of the Secured Notes or any other Securities (as defined in the Fee Letter) on the Closing Date (which amounts shall be automatically added to the Commitment Parties’ commitments under the Commitment Letter) minus the amount of gross proceeds from Secured Notes on the Closing Date. |
Availability: |
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The Secured Bridge Lenders will make the Secured Bridge Loans on the Closing Date simultaneously with (a) the consummation of the Acquisition and (b) the initial funding under the Term Loan Facility. Amounts borrowed under the Secured Bridge Facility that are repaid or prepaid may not be reborrowed. |
Use of Proceeds: |
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The proceeds of the Secured Bridge Loans will be used by the Borrower on the Closing Date, together with the proceeds of borrowings under the Unsecured Bridge Facility, the proceeds from the issuance of the Secured Notes, the proceeds from the Equity Contribution and cash on hand at the Borrower, to provide Acquisition Funds. |
| [Secured Bridge Facility Term Sheet] | |
Ranking: |
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The Secured Bridge Loans will rank equal in right of payment with the Bank Facilities and other senior indebtedness of the Borrower and will not be secured. |
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Guarantees: |
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All obligations of the Borrower under the Secured Bridge Facility will be jointly and severally guaranteed by each Subsidiary Guarantor (as defined in Exhibit B to the Commitment Letter), on a senior basis (such guarantees, the “Secured Bridge Guarantees”). The Secured Bridge Guarantees will automatically be released upon the release of the corresponding guarantees of the Bank Facilities (other than in connection with a refinancing or repayment in full of the Bank Facilities). The Secured Bridge Guarantees will rank equal in right of payment with the guarantees of the Bank Facilities. |
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Security: |
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The Secured Bridge Loans will be secured by the same assets that secure the Bank Facilities. |
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Intercreditor Agreement: |
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The lien priority, relative rights and other creditors’ rights issues in respect of the Secured Bridge Loans and the Bank Facilities will be set forth in the Intercreditor Agreement (as defined in Exhibit B). |
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Maturity: |
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All Secured Bridge Loans will have an initial maturity date that is the one-year anniversary of the Closing Date (the “Initial Secured Bridge Loan Maturity Date”), which shall be extended as provided below. If any of the Secured Bridge Loans have not been previously repaid in full on or prior to the Initial Secured Bridge Loan Maturity Date, unless a bankruptcy event of default with respect to the Borrower shall have occurred and be continuing, such Secured Bridge Loans will be automatically converted into a senior Secured term loan (each an “Secured Extended Term Loan”) due on the date that is seven years after the Closing Date (the “Secured Extended Maturity Date”) and having terms set forth on Annex I to this Exhibit C. The date on which Secured Bridge Loans are converted into Secured Extended Term Loans is referred to as the “Secured Conversion Date”. On the Secured Conversion Date, and on the 15th calendar day of each month thereafter (or the immediately succeeding business day if such calendar day is not a business day) at the option of the applicable Secured Bridge Lender, the Secured Extended Term Loans may be exchanged in whole or in part for senior Secured Exchange Notes (the “Secured Exchange Notes”) having an equal principal amount and having the terms set forth in Annex II hereto; provided that (i) no Secured Exchange Notes shall be issued until the Borrower shall have received requests to issue at least $250 million in aggregate principal amount of Secured Exchange Notes and (ii) no subsequent Secured Exchange Notes shall be issued until the Borrower shall have received additional requests to issue at least $250 million in aggregate principal amount of additional Secured Exchange Notes or if less, the remaining amount of Secured Extended Term Loans. |
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The Secured Extended Term Loans will be governed by the provisions of the Secured Bridge Facility Documentation (as hereinafter defined) and will have the same terms as the Secured Bridge Loans except as set forth on Annex I hereto. The Secured Exchange Notes will be issued pursuant to an indenture that will have the terms set forth on Annex II hereto. |
| [Secured Bridge Facility Term Sheet] | |
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The Secured Extended Term Loans and the Secured Exchange Notes shall rank equal in right of payment for all purposes. |
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Interest Rates: |
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Interest on the Secured Bridge Loans for the first three-month period commencing on the Closing Date shall be payable at Term SOFR (for interest periods of 1, 3 or 6 months, as selected by the Borrower and, for purposes of the Secured Bridge Facility, with a 0.00% “floor”) plus 675 basis points (the “Secured Bridge Initial Margin”). Thereafter, subject to the Secured Total Cap (as defined in the Fee Letter), interest shall be payable at prevailing Term SOFR for the interest period selected by the Borrower plus the Secured Bridge Applicable Margin (as defined below) and shall increase by an additional 50 basis points at the beginning of each three-month period subsequent to the initial three-month period for so long as the Secured Bridge Loans are outstanding (except on the Secured Conversion Date) (the Secured Bridge Initial Margin together with each 50 basis point increase therein described above, the “Secured Bridge Applicable Margin”). |
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Notwithstanding anything to the contrary set forth above, at no time, other than as provided under the heading “Default Rate” below, shall the per annum yield on the Secured Bridge Loans exceed the amount specified in the Fee Letter in respect of the Secured Bridge Facility as the “Secured Total Cap”. |
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Following the Initial Secured Bridge Loan Maturity Date, all outstanding Secured Extended Term Loans will accrue interest at a rate equal to the Secured Total Cap. |
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Interest Payments: |
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Interest on the Secured Bridge Loans will be payable in arrears at the end of each interest period and, for interest periods of greater than 3 months, every three months, and on the Initial Secured Bridge Loan Maturity Date. Calculation of interest shall be on the basis of actual days elapsed in a year of 360 days. |
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Default Rate: |
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During the continuance of any event of default under the Secured Bridge Facility Documentation, overdue principal, interest, fees and other amounts shall bear interest at the applicable interest rate plus 2.00% per annum. |
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Notwithstanding anything to the contrary set forth herein, in no event shall any cap or limit on the yield or interest rate payable with respect to the Secured Bridge Loans, Secured Extended Term Loans or Secured Exchange Notes affect the payment of any default rate of interest in respect of any Secured Bridge Loan, Secured Extended Term Loans or Secured Exchange Notes. |
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Mandatory Prepayment: |
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The Borrower will be required to prepay the Secured Bridge Loans on a pro rata basis at 100% of the outstanding principal amount thereof with (i) the net cash proceeds from the issuance of the Secured Notes; provided that in the event any Secured Bridge Lender or affiliate of a Secured Bridge Lender purchases debt securities from the Borrower pursuant to a permitted securities demand at an issue price above the price at which such Secured Bridge Lender or affiliate has reasonably determined such debt securities can be resold by such Bridge Lender or affiliate to a bona fide third party at the time of such purchase (and notifies the Borrower thereof), the net cash proceeds received by the Borrower in respect of such debt securities may, at the option of such Secured Bridge Lender or affiliate, be applied first to prepay the Secured Bridge Loans of such Secured Bridge Lender or affiliate (provided that if there is more than one such Secured Bridge Lender or affiliate then such net cash proceeds will be applied pro rata to prepay the Secured Bridge Loans of all such Secured Bridge Lenders or affiliates in proportion to such Secured Bridge Lenders’ or affiliates’ principal amount of debt securities purchased from the Borrower) prior to being applied to prepay the Secured Bridge Loans held by other Secured Bridge Lenders; (ii) the net cash proceeds from the issuance of any Refinancing Debt (to be defined in a manner consistent with the Secured Bridge Documentation Principles) by the Borrower or any of its restricted subsidiaries; and (iii) the net cash proceeds from any non-ordinary course asset sales by the Borrower or any of its restricted subsidiaries in excess of amounts reinvested which shall be shared on a ratable basis with the lenders under the Bank Facilities and the holder of certain other indebtedness secured on a pari passu basis therewith, in the case of any such prepayments pursuant to the foregoing clauses (i), (ii) and (iii) above with exceptions and baskets consistent with the Secured Bridge Documentation Principles. The Borrower will also be required to offer to prepay the Secured Bridge Loans following the occurrence of a change of control (to be defined in a manner consistent with the Secured Bridge Documentation Principles) at 100% of the outstanding principal amount thereof, subject to the Secured Bridge Documentation Principles. These mandatory prepayment provisions will not apply to the Secured Extended Term Loans. |
| [Secured Bridge Facility Term Sheet] | |
Optional Prepayment: |
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The Secured Bridge Loans may be prepaid, in whole or in part, at par plus accrued and unpaid interest upon not less than three days’ prior written notice, at the option of the Borrower at any time. |
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Documentation: |
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The definitive documentation for the Secured Bridge Facility (the “Secured Bridge Facility Documentation”) shall contain the terms set forth in this Exhibit C and shall otherwise be negotiated in good faith within a reasonable time period to be determined based on the expected Closing Date and substantially consistent with a market precedent for leading private equity sponsors to be agreed between MSSF and the Borrower with changes as are consistent with provisions customarily found in high yield indentures of comparable issuers and as modified to reflect the operational and strategic requirements of the Borrower and its subsidiaries in light of their size, industries, businesses and business practices, operations, financial accounting and Projections set forth in the Acquisition Model and administrative and operational changes as reasonably requested by the Secured Bridge Administrative Agent and modifications to reflect the reasonable administrative, agency and operational requirements of the Administrative Agents (including, without limitation, customary EU/UK Bail-In provisions, erroneous payment provisions, benchmark adjustment provisions and QFC stay provisions) and to account for the nature of the Secured Bridge Loans as being secured on a pari passu basis with the Bank Facilities (such precedent, provisions and requirements, the “Secured Bridge Documentation Principles”). Notwithstanding the foregoing, the only conditions to the availability of the Secured Bridge Facility on the Closing Date shall be the applicable conditions set forth in Exhibit E to the Commitment Letter. The Secured Bridge Facility Documentation shall contain only those representations, events of default and covenants as set forth in this Exhibit C. |
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Conditions to Borrowing: |
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The availability of the Secured Bridge Facility on the Closing Date will be subject solely to the applicable conditions set forth in Exhibit E to the Commitment Letter. |
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Representations and Warranties: |
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The Secured Bridge Facility Documentation
will contain representations and warranties as are substantially similar to those for the Bank Facilities, but in any event are no less
favorable to the Borrower and the Investors than those in the Bank Facilities, including as to exceptions and qualifications. |
| [Secured Bridge Facility Term Sheet] | |
Covenants: |
|
The Secured Bridge Facility Documentation will contain such affirmative and negative covenants with respect to the Borrower and its restricted subsidiaries as are usual and customary for Secured Bridge Loan financings of this type consistent with the Secured Bridge Documentation Principles and in any event no more restrictive than the Term Loan Facility, it being understood and agreed that (a) the covenants of the Secured Bridge Loans (and the Secured Extended Term Loans and the Secured Exchange Notes) will be incurrence-based covenants consistent provisions customarily found in high yield indentures of comparable issuers (and consistent with the Secured Bridge Documentation Principles) and (b) the debt incurrence ratio in the “credit facilities basket” and otherwise governing the incurrence of secured debt in the Secured Bridge Facility Documentation will be a “Consolidated Secured Debt Ratio” set at the Closing Date First Lien Leverage Ratio. Prior to the Initial Maturity Date, the debt and lien incurrence and the restricted payment covenants of the Secured Bridge Loans will be more restrictive than those of the Secured Extended Term Loans, the Secured Exchange Notes and the Bank Facilities, as reasonably agreed by the Lead Arrangers and the Borrower. |
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Financial Maintenance Covenants: |
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None. |
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Events of Default: |
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Limited to nonpayment of principal, interest or other amounts; violation of covenants; incorrectness of representations and warranties in any material respect; cross acceleration to material indebtedness; bankruptcy or insolvency of the Borrower or its significant restricted subsidiaries; material monetary judgments; ERISA events; actual or asserted invalidity of guarantees; and actual or asserted invalidity of the liens over a material portion of the Collateral, consistent in each case with the Secured Bridge Documentation Principles. |
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Cost and Yield Protection: |
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The Secured Bridge Documentation will include customary tax gross-up, cost and yield protection provisions substantially consistent with those set forth in the Bank Facilities Documentation. |
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Assignment and Participation: |
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The Secured Bridge Lenders will have the right to assign Secured Bridge Loans after the Closing Date without the consent of the Borrower; provided, however, that prior to the date that is one year after the Closing Date and so long as a Demand Failure Event (as defined in the Fee Letter) has not occurred and no payment or bankruptcy event of default shall have occurred and be continuing, the consent of the Borrower shall be required with respect to any assignment (such consent not to be unreasonably withheld or delayed) if, subsequent thereto, the Initial Secured Bridge Lenders (together with their affiliates) would hold, in the aggregate, less than 51% of the outstanding Secured Bridge Loans. |
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The Secured Bridge Lenders will have the right to participate their Secured Bridge Loans, before or after the Closing Date, to other financial institutions without restriction, other than customary voting limitations. Participants will have the same benefits as the selling Lenders would have (and will be limited to the amount of such benefits) with regard to yield protection and increased costs, subject to customary limitations and restrictions. |
| [Secured Bridge Facility Term Sheet] | |
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The Secured Bridge Facility Documentation shall
provide that (a) Secured Bridge Loans may be purchased by the Borrower and assigned on a non-pro rata basis through customary loan
buy-back procedures and (b) the Investors and their affiliates (other than the Borrower and its subsidiaries) (other than any such
affiliate that is a bona fide debt fund or entity that extends credit or buys loans in the ordinary course of business (“Affiliated
Debt Fund”)) (each an “Affiliated Lender”) shall be eligible assignees; provided that (i) any
such Secured Bridge Loans acquired by the Borrower or any of its subsidiaries shall be retired and cancelled promptly upon acquisition
thereof (or contribution thereto) and (ii) any such Secured Bridge Loans acquired by the Investors, Holdings or any of their affiliates
may, with the consent of the Borrower, be contributed to the Borrower (whether through any of its direct or indirect parent entities or
otherwise) and exchanged for debt or equity securities of such parent entity or the Borrower that are otherwise permitted to be issued
by such entity at such time; provided that assignments to Affiliated Lenders shall be subject to the following limitations:
(i) Affiliated
Lenders will not receive information provided solely to Secured Bridge Lenders and will not be permitted to attend/participate in Secured
Bridge Lender meetings;
(ii) the
Affiliated Lenders shall have no right to vote any of its interest under the Secured Bridge Facility (such interest will be deemed voted
in the same proportion as non-affiliated Secured Bridge Lenders voting on such matter) except that each Affiliated Lender shall have the
right to vote on any amendment, modification, waiver or consent that would require the vote of all Secured Bridge Lenders or the vote
of all affected Secured Bridge Lenders (as set forth in “Voting” below) and no amendment, modification, waiver or consent
shall affect any Affiliated Lender (in its capacity as a Secured Bridge Lender) in a manner that is disproportionate to the effect on
any Secured Bridge Lender of the same class or that would deprive such Affiliated Lender of its pro rata share of any payments to which
Secured Bridge Lenders are entitled; and
(iii) the
amount of Secured Bridge Loans and Secured Extended Term Loans purchased by Affiliated Lenders shall not exceed 30% of the aggregate outstanding
amount of Secured Bridge Loans and Secured Extended Term Loans at any time. |
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Voting: |
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Amendments and waivers of the Secured Bridge Facility Documentation will require the approval of Lenders holding more than 50% of the outstanding Secured Bridge Loans, except that (a) the consent of each affected Lender will be required for (i) reductions of principal, interest rates or the Secured Bridge Applicable Margin, (ii) extensions of the Initial Secured Bridge Loan Maturity Date (except as provided under “Maturity” above) or the Secured Extended Maturity Date or the scheduled date of payment of any interest or fees, (iii) additional restrictions on the right to exchange Secured Extended Term Loans for Secured Exchange Notes or any amendment of the rate of such exchange, (iv) any amendment to the Secured Exchange Notes that requires (or would, if any Secured Exchange Notes were outstanding, require) the approval of all holders of Secured Exchange Notes and (v) subject to certain exceptions consistent with the Secured Bridge Documentation Principles, releases of all or substantially all of the value of the Guarantees (other than in connection with any release or sale of the relevant Guarantor permitted by the Secured Bridge Facility Documentation or Bank Facilities Documentation) or all or substantially all of the Collateral and (b) the consent of 100% of the Secured Bridge Lenders will be required with respect to modifications to any of the voting percentages. |
| [Secured Bridge Facility Term Sheet] | |
Expenses and Indemnification: |
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The Secured Bridge Facility Documentation will include expenses and indemnification provisions substantially consistent with those set forth in the Bank Facilities Documentation. |
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Governing Law: |
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New York; provided that (a) to the extent the Acquisition is consummated pursuant to the Acquisition Agreement, the laws of the State set forth in the Acquisition Agreement shall govern in determining (i) whether a material adverse effect under the Acquisition Agreement has occurred, (ii) the accuracy of any Company Representation and whether you (or any of your subsidiaries or affiliates) have the right to terminate your (or their) obligations under the Acquisition Agreement or decline to consummate the Acquisition as a result of a breach of such representations in the Acquisition Agreement and (iii) whether the Acquisition has been consummated in accordance with the terms of the Acquisition Agreement and (b) to the extent the Acquisition is consummated pursuant to the Tender Offer, the federal securities laws of the United States shall govern in determining whether the Initial Offer to Purchase has been consummated in accordance with the terms and conditions thereof. |
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Counsel to the Secured Bridge Administrative Agent and Secured Bridge Lead Arrangers: |
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Davis Polk & Wardwell LLP. |
| [Secured Bridge Facility Term Sheet] | |
ANNEX I to
EXHIBIT C
Secured Extended Term
Loans
Maturity: |
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The Secured Extended Term Loans will mature on the date that is seven years after the Closing Date. |
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Interest Rate: |
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The Secured Extended Term Loans will bear interest at an interest rate per annum (the “Secured Extended Term Loan Interest Rate”) equal to the Secured Total Cap. Interest shall be payable on the last day of each fiscal quarter of the Borrower and on the Secured Extended Maturity Date, in each case payable in arrears and computed on the basis of a 360 day year. |
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Default Rate: |
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During the continuance of any event of default under the Secured Extended Term Loans, overdue principal, interest, fees and other amounts shall bear interest at the applicable interest rate plus 2.00% per annum. |
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Ranking: |
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Same as the Secured Bridge Loans. |
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Guarantees: |
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Same as the Secured Bridge Loans. |
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Security: |
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Same as the Secured Bridge Loans and subject to the Intercreditor Agreement. |
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Covenants, Defaults and Mandatory Prepayments: |
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Upon and after the Secured Conversion Date, the covenants, mandatory prepayments (other than with respect to a change of control, with respect to which the provisions of the Secured Bridge Loans will apply) and defaults which would be applicable to the Secured Exchange Notes, if issued, will also be applicable to the Secured Extended Term Loans in lieu of the corresponding provisions of the Secured Bridge Facility Documentation. |
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Optional Prepayment: |
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The Secured Extended Term Loans may be prepaid, in whole or in part, at par, plus accrued and unpaid interest upon not less than three days’ prior written notice, at the option of the Borrower at any time. |
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Governing Law: |
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New York. |
CONFIDENTIAL |
ANNEX II to |
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EXHIBIT C |
Secured Exchange Notes
Issuer: |
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The Borrower will issue the Secured Exchange Notes under an indenture. The Borrower, in its capacity as the issuer of the Secured Exchange Notes, is referred to as the “Issuer”. In addition, if the Issuer is not a corporation, there shall at all times be a joint and several co-issuer of the Secured Exchange Notes that is a corporation and is wholly owned restricted subsidiary of the Issuer. |
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Principal Amount: |
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The Secured Exchange Notes will be available only in exchange for the Secured Extended Term Loans on or after the Secured Conversion Date. The principal amount of any Secured Exchange Note will equal 100% of the aggregate principal amount of the Secured Extended Term Loan for which it is exchanged. In the case of a partial exchange, the minimum amount of Secured Extended Term Loans to be exchanged for Secured Exchange Notes will be $250 million. |
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Maturity: |
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The Secured Exchange Notes will mature on the date that is seven years after the Closing Date. |
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Interest Rate: |
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The Secured Exchange Notes will bear interest payable semi-annually, in arrears, at a rate equal to the Secured Total Cap. |
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Default Rate: |
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During the continuance of any event of default under the Secured Exchange Notes, overdue principal, interest, fees and other amounts shall bear interest at the applicable interest rate plus 2.00% per annum. |
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Ranking: |
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Same as the Secured Bridge Loans and Secured Extended Term Loans. |
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Guarantees: |
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Same as the Secured Bridge Loans and Secured Extended Term Loans. |
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Security: |
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Same as the Secured Bridge Loans and subject to the Intercreditor Agreement. |
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Offer to Purchase from Asset Sale Proceeds: |
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The Issuer will be required to make an offer to repurchase the Secured Exchange Notes (and, if outstanding, prepay the Secured Extended Term Loans) on a pro rata basis, which offer shall be at 100% of the principal amount thereof with a portion of the net cash proceeds of all non-ordinary course asset sales by the Issuer and its restricted subsidiaries in excess of amounts either reinvested or required to be paid to the lenders under the Bank Facilities or to holders of certain other indebtedness, with such proceeds being applied to the Secured Extended Term Loans, the Secured Exchange Notes, and the Secured Notes in a manner to be agreed, subject to other exceptions and baskets consistent with the Secured Bridge Documentation Principles. |
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Offer to Purchase upon Change of Control: |
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The Issuer will be required to make an offer to repurchase the Secured Exchange Notes following the occurrence of a change of control (to be defined in a manner consistent with the Secured Bridge Documentation Principles) at a price in cash equal to 101% (or 100% in the case of Secured Exchange Notes held by the Commitment Parties or their respective affiliates other than asset management affiliates purchasing securities in the ordinary course of their business as part of a regular distribution of the securities (“Asset Management Affiliates”)), and excluding Secured Exchange Notes acquired pursuant to bona fide open market purchases from third parties or market activities (“Repurchased Securities”), of the outstanding principal amount thereof, plus accrued and unpaid interest to the date of repurchase unless the Issuer shall redeem such Secured Exchange Notes pursuant to the “Optional Redemption” section below. |
Optional Redemption: |
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Except as set forth in the next two succeeding paragraphs, the Secured Exchange Notes will be non-callable until the third anniversary of the Closing Date. Thereafter, each such Secured Exchange Note will be callable at par plus accrued interest plus a premium equal to 50% of the coupon on such Secured Exchange Note during the fourth year after the Closing Date, which call premium shall ratably decline to zero on the fifth anniversary of the Closing Date. |
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Prior to the third anniversary of the Closing Date, the Issuer may redeem such Secured Exchange Notes at a make-whole price based on U.S. Treasury notes with a maturity closest to the second anniversary of the Closing Date plus 50 basis points. |
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Prior to the third anniversary of the Closing Date, the Issuer may redeem up to 40% of such Secured Exchange Notes with an amount equal to proceeds from any equity offering at a price equal to par plus the coupon plus accrued interest on such Secured Exchange Notes on terms consistent with the Secured Bridge Documentation Principles. |
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The optional redemption provisions will be otherwise customary for high yield transactions and consistent with the Secured Bridge Documentation Principles. Prior to a Demand Failure Event, any Secured Exchange Notes held by the Commitment Parties or their respective affiliates (other than Asset Management Affiliates) and excluding Repurchased Securities, shall be redeemable at any time and from time to time at the option of the Borrower at a redemption price equal to par plus accrued and unpaid interest to the redemption date. |
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Defeasance and Discharge Provisions: |
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Consistent with the Secured Bridge Documentation Principles. |
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Modification: |
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Consistent with the Secured Bridge Documentation Principles. |
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Registration Rights:
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None. |
Right to Transfer Secured Exchange Notes: |
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The holders of the Secured Exchange Notes shall have the absolute and unconditional right to transfer such Secured Exchange Notes in compliance with applicable law to any third parties pursuant to Rule 144A and Regulation S (or any successor provisions thereto). |
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Covenants: |
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Such affirmative and negative covenants with respect to the Borrower and its restricted subsidiaries as are usual and customary for high yield financings of this type consistent with the Secured Bridge Documentation Principles, it being understood and agreed that the covenants of the Secured Exchange Notes will be incurrence-based covenants consistent with provisions customarily found in high yield indentures of comparable U.S.-based issuers (and consistent with the Secured Bridge Documentation Principles). |
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Events of Default: |
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Consistent with the Secured Bridge Documentation Principles. |
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Governing Law: |
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New York. |
| [Secured Bridge Facility Term Sheet] | |
CONFIDENTIAL
EXHIBIT D
Project X
$3,000.0 million Senior Unsecured Increasing Rate Unsecured Bridge Loans
Summary of Principal Terms and Conditions
All capitalized terms used but not defined herein
shall have the meanings given to them in the Commitment Letter to which this term sheet is attached, including Exhibit A thereto.
Borrower: |
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The Borrower under the Bank Facilities (the “Borrower”). |
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Transactions: |
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As set forth in Exhibit A to the Commitment Letter. |
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Unsecured Bridge Administrative Agent: |
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MSSF or an affiliate thereof will act as the sole and exclusive administrative agent (in such capacity, the “Unsecured Bridge Administrative Agent”) for a syndicate of banks, financial institutions and other institutional lenders and investors reasonably acceptable to the Unsecured Bridge Lead Arrangers (as defined below) and the Borrower, excluding any Disqualified Lender (together with the Initial Unsecured Bridge Lenders, the “Unsecured Bridge Lenders”), and will perform the duties customarily associated with such role. |
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Unsecured Bridge Lead Arrangers: |
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Each of MSSF, BofA Securities, Barclays, MUFG, BNPP Securities, Mizuho and SocGen will act as a lead arranger and joint bookrunner (together with any additional joint bookrunner appointed pursuant to the Commitment Letter, each in such capacity, an “Unsecured Bridge Lead Arranger”) and will perform the duties customarily associated with such roles. |
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Syndication Agent, Documentation Agent or Co-Documentation Agents: |
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The Borrower may designate additional financial institutions reasonably acceptable to the Majority Lead Arrangers (such consent not to be unreasonably withheld, delayed or conditioned) to act as syndication agent, documentation agent or co-documentation agent as provided in the Commitment Letter. |
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Senior Unsecured Bridge Loans: |
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The Unsecured Bridge Lenders will make senior unsecured increasing rate loans (the “Unsecured Bridge Loans”) to the Borrower on the Closing Date in an aggregate principal amount of up to $3,000.0 million plus, at the Borrower’s election, an amount sufficient to fund any OID or upfront fees required to be funded on the Closing Date in connection with the issuance of the Unsecured Notes or any other Securities (as defined in the Fee Letter) on the Closing Date (which amounts shall be automatically added to the Commitment Parties’ commitments under the Commitment Letter) minus the amount of gross proceeds from Unsecured Notes on the Closing Date. |
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Availability: |
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The Unsecured Bridge Lenders will make the Unsecured Bridge Loans on the Closing Date simultaneously with (a) the consummation of the Acquisition and (b) the initial funding under the Term Loan Facility. Amounts borrowed under the Unsecured Bridge Facility that are repaid or prepaid may not be reborrowed. |
Use of Proceeds: |
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The proceeds of the Unsecured Bridge Loans will be used by the Borrower on the Closing Date, together with the proceeds of borrowings under the Bank Facilities, the proceeds from the issuance of the Notes, the proceeds from the Equity Contribution and cash on hand at the Borrower, to provide Acquisition Funds. |
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Ranking: |
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The Unsecured Bridge Loans will rank equal in right of payment with the Senior Secured Facilities and other senior indebtedness of the Borrower and will not be secured. |
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Guarantees: |
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All obligations of the Borrower under the Unsecured Bridge Facility will be jointly and severally guaranteed by each Subsidiary Guarantor (as defined in Exhibit B to the Commitment Letter), on a senior basis (such guarantees, the “Unsecured Bridge Guarantees”). The Unsecured Bridge Guarantees will automatically be released upon the release of the corresponding guarantees of the Senior Secured Facilities (other than in connection with a refinancing or repayment in full of the Senior Secured Facilities). The Unsecured Bridge Guarantees will rank equal in right of payment with the guarantees of the Senior Secured Facilities. |
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Security: |
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None. |
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Maturity: |
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All Unsecured Bridge Loans will have an initial maturity date that is the one-year anniversary of the Closing Date (the “Initial Unsecured Bridge Loan Maturity Date”), which shall be extended as provided below. If any of the Unsecured Bridge Loans have not been previously repaid in full on or prior to the Initial Unsecured Bridge Loan Maturity Date, unless a bankruptcy event of default with respect to the Borrower shall have occurred and be continuing, such Unsecured Bridge Loans will be automatically converted into a senior unsecured term loan (each an “Unsecured Extended Term Loan”) due on the date that is eight years after the Closing Date (the “Unsecured Extended Maturity Date”) and having terms set forth on Annex I to this Exhibit D. The date on which Unsecured Bridge Loans are converted into Unsecured Extended Term Loans is referred to as the “Unsecured Conversion Date”. On the Unsecured Conversion Date, and on the 15th calendar day of each month thereafter (or the immediately succeeding business day if such calendar day is not a business day) at the option of the applicable Bridge Lender, the Unsecured Extended Term Loans may be exchanged in whole or in part for senior unsecured exchange notes (the “Unsecured Exchange Notes”) having an equal principal amount and having the terms set forth in Annex II hereto; provided that (i) no Unsecured Exchange Notes shall be issued until the Borrower shall have received requests to issue at least $250 million in aggregate principal amount of Unsecured Exchange Notes and (ii) no subsequent Unsecured Exchange Notes shall be issued until the Borrower shall have received additional requests to issue at least $250 million in aggregate principal amount of additional Unsecured Exchange Notes or if less, the remaining amount of Unsecured Extended Term Loans. |
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The Unsecured Extended Term Loans will be governed by the provisions of the Unsecured Bridge Facility Documentation (as hereinafter defined) and will have the same terms as the Unsecured Bridge Loans except as set forth on Annex I hereto. The Unsecured Exchange Notes will be issued pursuant to an indenture that will have the terms set forth on Annex II hereto. |
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The Unsecured Extended Term Loans and the Unsecured Exchange Notes shall rank equal in right of payment for all purposes. |
| [Unsecured Bridge Facility Term Sheet] | |
Interest Rates: |
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Interest on the Unsecured Bridge Loans for the first three-month period commencing on the Closing Date shall be payable at Term SOFR (for interest periods of 1, 3 or 6 months, as selected by the Borrower and, for purposes of the Unsecured Bridge Facility, with a 0.00% “floor”) plus 1000 basis points (the “Unsecured Bridge Initial Margin”). Thereafter, subject to the Unsecured Total Cap (as defined in the Fee Letter), interest shall be payable at prevailing Term SOFR for the interest period selected by the Borrower plus the Unsecured Bridge Applicable Margin (as defined below) and shall increase by an additional 50 basis points at the beginning of each three-month period subsequent to the initial three-month period for so long as the Unsecured Bridge Loans are outstanding (except on the Unsecured Conversion Date) (the Unsecured Bridge Initial Margin together with each 50 basis point increase therein described above, the “Unsecured Bridge Applicable Margin”). |
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Notwithstanding anything to the contrary set forth above, at no time, other than as provided under the heading “Default Rate” below, shall the per annum yield on the Unsecured Bridge Loans exceed the amount specified in the Fee Letter in respect of the Unsecured Bridge Facility as the “Unsecured Total Cap”. |
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Following the Initial Unsecured Bridge Loan Maturity Date, all outstanding Unsecured Extended Term Loans will accrue interest at a rate equal to the Unsecured Total Cap. |
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Interest Payments: |
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Interest on the Unsecured Bridge Loans will be payable in arrears at the end of each interest period and, for interest periods of greater than 3 months, every three months, and on the Initial Unsecured Bridge Loan Maturity Date. Calculation of interest shall be on the basis of actual days elapsed in a year of 360 days. |
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Default Rate: |
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During the continuance of any event of default under the Unsecured Bridge Facility Documentation, overdue principal, interest, fees and other amounts shall bear interest at the applicable interest rate plus 2.00% per annum. |
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Notwithstanding anything to the contrary set forth herein, in no event shall any cap or limit on the yield or interest rate payable with respect to the Unsecured Bridge Loans, Unsecured Extended Term Loans or Unsecured Exchange Notes affect the payment of any default rate of interest in respect of any Unsecured Bridge Loan, Unsecured Extended Term Loans or Unsecured Exchange Notes. |
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Mandatory Prepayment: |
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The Borrower will be required to prepay the Unsecured Bridge Loans on a pro rata basis at 100% of the outstanding principal amount thereof with (i) the net cash proceeds from the issuance of the Unsecured Notes; provided that in the event any Bridge Lender or affiliate of a Bridge Lender purchases debt securities from the Borrower pursuant to a permitted securities demand at an issue price above the price at which such Bridge Lender or affiliate has reasonably determined such debt securities can be resold by such Bridge Lender or affiliate to a bona fide third party at the time of such purchase (and notifies the Borrower thereof), the net cash proceeds received by the Borrower in respect of such debt securities may, at the option of such Bridge Lender or affiliate, be applied first to prepay the Unsecured Bridge Loans of such Bridge Lender or affiliate (provided that if there is more than one such Bridge Lender or affiliate then such net cash proceeds will be applied pro rata to prepay the Unsecured Bridge Loans of all such Unsecured Bridge Lenders or affiliates in proportion to such Unsecured Bridge Lenders’ or affiliates’ principal amount of debt securities purchased from the Borrower) prior to being applied to prepay the Unsecured Bridge Loans held by other Unsecured Bridge Lenders; (ii) the net cash proceeds from the issuance of any Refinancing Debt (to be defined in a manner consistent with the Unsecured Bridge Documentation Principles) by the Borrower or any of its restricted subsidiaries; and (iii) the net cash proceeds from any non-ordinary course asset sales by the Borrower or any of its restricted subsidiaries in excess of amounts either reinvested or required to be paid to the lenders under the Bank Facilities, the Secured Bridge Facility and/or the Senior Secured Notes or the holder of certain other indebtedness, in the case of any such prepayments pursuant to the foregoing clauses (i), (ii) and (iii) above with exceptions and baskets consistent with the Unsecured Bridge Documentation Principles. The Borrower will also be required to offer to prepay the Unsecured Bridge Loans following the occurrence of a change of control (to be defined in a manner consistent with the Unsecured Bridge Documentation Principles) at 100% of the outstanding principal amount thereof, subject to the Unsecured Bridge Documentation Principles. These mandatory prepayment provisions will not apply to the Unsecured Extended Term Loans. |
| [Unsecured Bridge Facility Term Sheet] | |
Optional Prepayment: |
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The Unsecured Bridge Loans may be prepaid, in whole or in part, at par plus accrued and unpaid interest upon not less than three days’ prior written notice, at the option of the Borrower at any time. |
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Documentation: |
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The definitive documentation for the Unsecured Bridge Facility (the “Unsecured Bridge Facility Documentation”) shall contain the terms set forth in this Exhibit D and shall otherwise be negotiated in good faith within a reasonable time period to be determined based on the expected Closing Date and substantially consistent with a market precedent for leading private equity sponsors to be agreed between MSSF and the Borrower with changes as are consistent with provisions customarily found in high yield indentures of comparable issuers and as modified to reflect the operational and strategic requirements of the Borrower and its subsidiaries in light of their size, industries, businesses and business practices, operations, financial accounting and Projections set forth in the Acquisition Model and administrative and operational changes as reasonably requested by the Unsecured Bridge Administrative Agent and modifications to reflect the reasonable administrative, agency and operational requirements of the Administrative Agents (including, without limitation, customary EU/UK Bail-In provisions, erroneous payment provisions, benchmark adjustment provisions and QFC stay provisions) (such precedent, provisions and requirements, the “Unsecured Bridge Documentation Principles”). Notwithstanding the foregoing, the only conditions to the availability of the Unsecured Bridge Facility on the Closing Date shall be the applicable conditions set forth in Exhibit E to the Commitment Letter. The Unsecured Bridge Facility Documentation shall contain only those representations, events of default and covenants as set forth in this Exhibit D. |
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Conditions to Borrowing: |
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The availability of the Unsecured Bridge Facility on the Closing Date will be subject solely to the applicable conditions set forth in Exhibit E to the Commitment Letter. |
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Representations and Warranties: |
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The Unsecured Bridge Facility Documentation will contain representations and warranties as are substantially similar to those for the Bank Facilities, but in any event are no less favorable to the Borrower and the Investors than those in the Bank Facilities, including as to exceptions and qualifications. |
| [Unsecured Bridge Facility Term Sheet] | |
Covenants: |
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The Unsecured Bridge Facility Documentation will contain such affirmative and negative covenants with respect to the Borrower and its restricted subsidiaries as are usual and customary for Unsecured Bridge Loan financings of this type consistent with the Unsecured Bridge Documentation Principles and in any event no more restrictive than the Term Loan Facility, it being understood and agreed that (a) the covenants of the Unsecured Bridge Loans (and the Unsecured Extended Term Loans and the Unsecured Exchange Notes) will be incurrence-based covenants consistent provisions customarily found in high yield indentures of comparable issuers (and consistent with the Unsecured Bridge Documentation Principles) and (b) the debt incurrence ratio in the “credit facilities basket” and otherwise governing the incurrence of secured debt in the Unsecured Bridge Facility Documentation will be a “Consolidated Secured Debt Ratio” set at the Closing Date First Lien Leverage Ratio. Prior to the Initial Maturity Date, the debt and lien incurrence and the restricted payment covenants of the Unsecured Bridge Loans will be more restrictive than those of the Unsecured Extended Term Loans, the Unsecured Exchange Notes and the Bank Facilities, as reasonably agreed by the Lead Arrangers and the Borrower. |
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Financial Maintenance Covenants: |
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None. |
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Events of Default: |
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Limited to nonpayment of principal, interest or other amounts; violation of covenants; incorrectness of representations and warranties in any material respect; cross acceleration to material indebtedness; bankruptcy or insolvency of the Borrower or its significant restricted subsidiaries; material monetary judgments; ERISA events; and actual or asserted invalidity of guarantees, consistent in each case with the Unsecured Bridge Documentation Principles. |
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Cost and Yield Protection: |
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The Unsecured Bridge Documentation will include customary tax gross-up, cost and yield protection provisions substantially consistent with those set forth in the Bank Facilities Documentation. |
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Assignment and Participation: |
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The Unsecured Bridge Lenders will have the right to assign Unsecured Bridge Loans after the Closing Date without the consent of the Borrower; provided, however, that prior to the date that is one year after the Closing Date and so long as a Demand Failure Event (as defined in the Fee Letter) has not occurred and no payment or bankruptcy event of default shall have occurred and be continuing, the consent of the Borrower shall be required with respect to any assignment (such consent not to be unreasonably withheld or delayed) if, subsequent thereto, the Initial Unsecured Bridge Lenders (together with their affiliates) would hold, in the aggregate, less than 51% of the outstanding Unsecured Bridge Loans. |
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The Unsecured Bridge Lenders will have the right to participate their Unsecured Bridge Loans, before or after the Closing Date, to other financial institutions without restriction, other than customary voting limitations. Participants will have the same benefits as the selling Lenders would have (and will be limited to the amount of such benefits) with regard to yield protection and increased costs, subject to customary limitations and restrictions. |
| [Unsecured Bridge Facility Term Sheet] | |
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The Unsecured Bridge Facility Documentation shall
provide that (a) Unsecured Bridge Loans may be purchased by the Borrower and assigned on a non-pro rata basis through customary loan
buy-back procedures and (b) the Investors and their affiliates (other than the Borrower and its subsidiaries) (other than any such
affiliate that is a bona fide debt fund or entity that extends credit or buys loans in the ordinary course of business (“Affiliated
Debt Fund”)) (each an “Affiliated Lender”) shall be eligible assignees; provided that (i) any
such Unsecured Bridge Loans acquired by the Borrower or any of its subsidiaries shall be retired and cancelled promptly upon acquisition
thereof (or contribution thereto) and (ii) any such Unsecured Bridge Loans acquired by the Investors, Holdings or any of their affiliates
may, with the consent of the Borrower, be contributed to the Borrower (whether through any of its direct or indirect parent entities or
otherwise) and exchanged for debt or equity securities of such parent entity or the Borrower that are otherwise permitted to be issued
by such entity at such time; provided that assignments to Affiliated Lenders shall be subject to the following limitations:
(i) Affiliated
Lenders will not receive information provided solely to Unsecured Bridge Lenders and will not be permitted to attend/participate in Bridge
Lender meetings;
(ii) the
Affiliated Lenders shall have no right to vote any of its interest under the Unsecured Bridge Facility (such interest will be deemed voted
in the same proportion as non-affiliated Unsecured Bridge Lenders voting on such matter) except that each Affiliated Lender shall have
the right to vote on any amendment, modification, waiver or consent that would require the vote of all Unsecured Bridge Lenders or the
vote of all affected Unsecured Bridge Lenders (as set forth in “Voting” below) and no amendment, modification, waiver or consent
shall affect any Affiliated Lender (in its capacity as a Bridge Lender) in a manner that is disproportionate to the effect on any Bridge
Lender of the same class or that would deprive such Affiliated Lender of its pro rata share of any payments to which Unsecured Bridge
Lenders are entitled; and
(iii) the
amount of Unsecured Bridge Loans and Unsecured Extended Term Loans purchased by Affiliated Lenders shall not exceed 30% of the aggregate
outstanding amount of Unsecured Bridge Loans and Unsecured Extended Term Loans at any time. |
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Voting: |
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Amendments and waivers of the Unsecured Bridge Facility Documentation will require the approval of Lenders holding more than 50% of the outstanding Unsecured Bridge Loans, except that (a) the consent of each affected Lender will be required for (i) reductions of principal, interest rates or the Unsecured Bridge Applicable Margin, (ii) extensions of the Initial Unsecured Bridge Loan Maturity Date (except as provided under “Maturity” above) or the Unsecured Extended Maturity Date or the scheduled date of payment of any interest or fees, (iii) additional restrictions on the right to exchange Unsecured Extended Term Loans for Unsecured Exchange Notes or any amendment of the rate of such exchange, (iv) any amendment to the Unsecured Exchange Notes that requires (or would, if any Unsecured Exchange Notes were outstanding, require) the approval of all holders of Unsecured Exchange Notes and (v) subject to certain exceptions consistent with the Unsecured Bridge Documentation Principles, releases of all or substantially all of the value of the Guarantees (other than in connection with any release or sale of the relevant Guarantor permitted by the Unsecured Bridge Facility Documentation or Bank Facilities Documentation) and (b) the consent of 100% of the Unsecured Bridge Lenders will be required with respect to modifications to any of the voting percentages. |
| [Unsecured Bridge Facility Term Sheet] | |
Expenses and Indemnification: |
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The Unsecured Bridge Facility Documentation will include expenses and indemnification provisions substantially consistent with those set forth in the Bank Facilities Documentation. |
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Governing Law: |
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New York; provided that (a) to the extent the Acquisition is consummated pursuant to the Acquisition Agreement, the laws of the State set forth in the Acquisition Agreement shall govern in determining (i) whether a material adverse effect under the Acquisition Agreement has occurred, (ii) the accuracy of any Company Representation and whether you (or any of your subsidiaries or affiliates) have the right to terminate your (or their) obligations under the Acquisition Agreement or decline to consummate the Acquisition as a result of a breach of such representations in the Acquisition Agreement and (iii) whether the Acquisition has been consummated in accordance with the terms of the Acquisition Agreement and (b) to the extent the Acquisition is consummated pursuant to the Tender Offer, the federal securities laws of the United States shall govern in determining whether the Initial Offer to Purchase has been consummated in accordance with the terms and conditions thereof. |
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Counsel to the Unsecured Bridge Administrative Agent and Unsecured Bridge Lead Arrangers: |
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Davis Polk & Wardwell LLP. |
| [Unsecured Bridge Facility Term Sheet] | |
ANNEX I to
EXHIBIT D
Unsecured Extended Term Loans
Maturity: |
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The Unsecured Extended Term Loans will mature on the date that is eight years after the Closing Date. |
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Interest Rate: |
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The Unsecured Extended Term Loans will bear interest at an interest rate per annum (the “Unsecured Extended Term Loan Interest Rate”) equal to the Unsecured Total Cap. Interest shall be payable on the last day of each fiscal quarter of the Borrower and on the Unsecured Extended Maturity Date, in each case payable in arrears and computed on the basis of a 360 day year. |
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Default Rate: |
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During the continuance of any event of default under the Unsecured Extended Term Loans, overdue principal, interest, fees and other amounts shall bear interest at the applicable interest rate plus 2.00% per annum. |
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Ranking: |
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Same as the Unsecured Bridge Loans. |
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Guarantees: |
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Same as the Unsecured Bridge Loans. |
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Security: |
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None. |
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Covenants, Defaults and Mandatory Prepayments: |
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Upon and after the Unsecured Conversion Date, the covenants, mandatory prepayments (other than with respect to a change of control, with respect to which the provisions of the Unsecured Bridge Loans will apply) and defaults which would be applicable to the Unsecured Exchange Notes, if issued, will also be applicable to the Unsecured Extended Term Loans in lieu of the corresponding provisions of the Unsecured Bridge Facility Documentation. |
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Optional Prepayment: |
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The Unsecured Extended Term Loans may be prepaid, in whole or in part, at par, plus accrued and unpaid interest upon not less than three days’ prior written notice, at the option of the Borrower at any time. |
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Governing Law: |
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New York. |
ANNEX II
to
EXHIBIT D
Unsecured Exchange Notes
Issuer: |
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The Borrower will issue the Unsecured Exchange Notes under an indenture. The Borrower, in its capacity as the issuer of the Unsecured Exchange Notes, is referred to as the “Issuer”. In addition, if the Issuer is not a corporation, there shall at all times be a joint and several co-issuer of the Unsecured Exchange Notes that is a corporation and is wholly owned restricted subsidiary of the Issuer. |
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Principal Amount: |
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The Unsecured Exchange Notes will be available only in exchange for the Unsecured Extended Term Loans on or after the Unsecured Conversion Date. The principal amount of any Unsecured Exchange Note will equal 100% of the aggregate principal amount of the Unsecured Extended Term Loan for which it is exchanged. In the case of a partial exchange, the minimum amount of Unsecured Extended Term Loans to be exchanged for Unsecured Exchange Notes will be $250 million. |
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Maturity: |
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The Unsecured Exchange Notes will mature on the date that is eight years after the Closing Date. |
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Interest Rate: |
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The Unsecured Exchange Notes will bear interest payable semi-annually, in arrears, at a rate equal to the Unsecured Total Cap. |
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Default Rate: |
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During the continuance of any event of default under the Unsecured Exchange Notes, overdue principal, interest, fees and other amounts shall bear interest at the applicable interest rate plus 2.00% per annum. |
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Ranking: |
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Same as the Unsecured Bridge Loans and Unsecured Extended Term Loans. |
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Guarantees: |
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Same as the Unsecured Bridge Loans and Unsecured Extended Term Loans. |
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Security: |
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None. |
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Offer to Purchase from Asset Sale Proceeds: |
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The Issuer will be required to make an offer to repurchase the Unsecured Exchange Notes (and, if outstanding, prepay the Unsecured Extended Term Loans) on a pro rata basis, which offer shall be at 100% of the principal amount thereof with a portion of the net cash proceeds of all non-ordinary course asset sales by the Issuer and its restricted subsidiaries in excess of amounts either reinvested or required to be paid to the lenders under the Senior Secured Facilities or to holders of certain other indebtedness, with such proceeds being applied to the Unsecured Extended Term Loans, the Unsecured Exchange Notes, and the Unsecured Notes in a manner to be agreed, subject to other exceptions and baskets consistent with the Unsecured Bridge Documentation Principles. |
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Offer to Purchase upon Change of Control: |
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The Issuer will be required to make an offer to repurchase the Unsecured Exchange Notes following the occurrence of a change of control (to be defined in a manner consistent with the Unsecured Bridge Documentation Principles) at a price in cash equal to 101% (or 100% in the case of Unsecured Exchange Notes held by the Commitment Parties or their respective affiliates other than asset management affiliates purchasing securities in the ordinary course of their business as part of a regular distribution of the securities (“Asset Management Affiliates”)), and excluding Unsecured Exchange Notes acquired pursuant to bona fide open market purchases from third parties or market activities (“Repurchased Securities”), of the outstanding principal amount thereof, plus accrued and unpaid interest to the date of repurchase unless the Issuer shall redeem such Unsecured Exchange Notes pursuant to the “Optional Redemption” section below. |
Optional Redemption: |
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Except as set forth in the next two succeeding paragraphs, the Unsecured Exchange Notes will be non-callable until the third anniversary of the Closing Date. Thereafter, each such Unsecured Exchange Note will be callable at par plus accrued interest plus a premium equal to 50% of the coupon on such Unsecured Exchange Note during the fourth year after the Closing Date, which call premium shall ratably decline to zero on the sixth anniversary of the Closing Date. |
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Prior to the third anniversary of the Closing Date, the Issuer may redeem such Unsecured Exchange Notes at a make-whole price based on U.S. Treasury notes with a maturity closest to the third anniversary of the Closing Date plus 50 basis points. |
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Prior to the third anniversary of the Closing Date, the Issuer may redeem up to 40% of such Unsecured Exchange Notes with an amount equal to proceeds from any equity offering at a price equal to par plus the coupon plus accrued interest on such Unsecured Exchange Notes on terms consistent with the Unsecured Bridge Documentation Principles. |
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The optional redemption provisions will be otherwise customary for high yield transactions and consistent with the Unsecured Bridge Documentation Principles. Prior to a Demand Failure Event, any Unsecured Exchange Notes held by the Commitment Parties or their respective affiliates (other than Asset Management Affiliates) and excluding Repurchased Securities, shall be redeemable at any time and from time to time at the option of the Borrower at a redemption price equal to par plus accrued and unpaid interest to the redemption date. |
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Defeasance and Discharge Provisions: |
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Consistent with the Unsecured Bridge Documentation Principles. |
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Modification: |
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Consistent with the Unsecured Bridge Documentation Principles. |
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Registration Rights:
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None. |
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Right to Transfer Unsecured Exchange Notes: |
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The holders of the Unsecured Exchange Notes shall have the absolute and unconditional right to transfer such Unsecured Exchange Notes in compliance with applicable law to any third parties pursuant to Rule 144A and Regulation S (or any successor provisions thereto). |
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Covenants: |
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Such affirmative and negative covenants with respect to the Borrower and its restricted subsidiaries as are usual and customary for high yield financings of this type consistent with the Unsecured Bridge Documentation Principles, it being understood and agreed that the covenants of the Unsecured Exchange Notes will be incurrence-based covenants consistent with provisions customarily found in high yield indentures of comparable U.S.-based issuers (and consistent with the Unsecured Bridge Documentation Principles). |
Events of Default: |
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Consistent with the Unsecured Bridge Documentation Principles. |
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Governing Law: |
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New York. |
Project X
Summary of Conditions
Except as otherwise set forth
below, the availability and initial funding on the Closing Date of each of the Facilities shall be subject to the satisfaction (or waiver
by the Commitment Parties) of the following conditions:
1. In
the case of the Tender Offer, the Tender Offer shall have been immediately prior to or, substantially concurrently with, the initial borrowing
under the Facilities, consummated in all material respects in accordance with the terms of the Initial Offer to Purchase, without giving
effect to any modifications, amendments or express waivers or consents by you (or one of your affiliates) thereto that are materially
adverse to the Initial Lenders in their capacities as such without the written consent of the Majority Lead Arrangers (not to be unreasonably
withheld, conditioned or delayed); provided that any modification, amendment, waiver or consent by you (or one of your affiliates)
with respect to the Poison Pill Condition (as defined in the Tender Offer as of the date hereof), the Minimum Tender Condition (as defined
in the Tender Offer as of the date hereof) or the Merger Agreement Condition (as defined in the Tender Offer as in effect on the date
hereof) shall be deemed materially adverse to the Initial Lenders in their capacities as such without the express written consent of the
Lead Arrangers who (together with their respective affiliates) hold at least 66.67% of the aggregate commitments in respect of the Facilities.
In the case of a Merger Transaction (i) the Acquisition Agreement shall be reasonably acceptable to the Majority Lead Arrangers (it
being understood that any such agreement shall be deemed to be reasonable to the Majority Lead Arrangers if (x) the terms of the
Acquisition set forth therein are generally consistent with the Initial Offer to Purchase without material modifications that are materially
adverse to the Initial Lenders and (y) contain customary “Xerox” lender protection provisions) and (ii) the Acquisition
shall have been immediately prior to or, substantially concurrently with the initial borrowing under the Facilities, consummated in all
material respects in accordance with the terms of the Acquisition Agreement, without giving effect to any modifications, amendments or
express waivers or consents by you (or one of your affiliates (other than the Company to the extent the Company would be considered an
affiliate)) thereto that are materially adverse to the Initial Lenders in their capacities as such without the consent of the Majority
Lead Arrangers (not to be unreasonably withheld, conditioned or delayed). It being understood that for purposes of the condition set forth
in this paragraph 1, (x) any increase in consideration payable with respect to the Acquisition shall not be materially adverse to
the Initial Lenders so long as such increase is not funded with additional indebtedness (other than amounts available to be drawn on the
Closing Date from the Facilities) and (y) notwithstanding the proviso above any modification, amendment, waiver or consent by you
(or one of your affiliates) with respect to the Minimum Tender Condition shall not be deemed to be materially adverse to the Initial Lenders
in their capacities as such if you (or one of your affiliates) acquire at least ninety percent (90)% of the outstanding shares of the
Company pursuant to the Tender Offer and consummate the Acquisition as a “short form” second-step merger pursuant to Section 253
of the DGCL as described in the Initial Offer to Purchase.
2. The
Equity Contribution shall have been made, or substantially concurrently with the borrowings under the Term Loan Facility, the Bridge Facilities
and/or the issuance of Notes shall be made, in at least the amount set forth in Exhibit A to the Commitment Letter.
3. To
the extent the Acquisition is consummated pursuant to a Merger Transaction, since the date of the Acquisition Agreement, there shall not
have been any “company material adverse effect” (or defined term of similar effect in the Acquisition Agreement).
4. Substantially
simultaneously with the initial borrowing under the Facilities, the Refinancing shall be consummated.
5. All
fees required to be paid on the Closing Date pursuant to the Fee Letter and reasonable out-of-pocket expenses required to be paid on the
Closing Date pursuant to the Commitment Letter, to the extent invoiced at least three business days prior to the Closing Date (except
as otherwise reasonably agreed by the Borrower), shall, upon the initial borrowings under the Facilities, have been, or will be substantially
simultaneously, paid (which amounts may, at your option, be offset against the proceeds of the Facilities).
6. To
the extent publicly filed by the Company, the Lead Arrangers shall have received (a) the audited consolidated balance sheets as of
the three most recently completed fiscal years ended at least 90 days prior to the Closing Date and the related audited consolidated statements
of operations and comprehensive income and cash flows of the Company and its subsidiaries for the three most recently completed fiscal
years ended at least 90 days before the Closing Date; and (b) the unaudited consolidated balance sheets and the related unaudited
consolidated statements of operations and comprehensive income and cash flows of the Company and its subsidiaries as of and for each subsequent
fiscal quarter (other than the fourth fiscal quarter of the Company’s fiscal year) ended at least 45 days before the Closing Date
(and the same period in the prior fiscal year). The Lead Arrangers hereby acknowledge that (x) the public filing by the Company with
the Securities and Exchange Commission of any required audited financial statements on Form 10-K or required unaudited financial
statements on Form 10-Q, in each case, will satisfy the requirements under clause (a) or (b), as applicable, of this paragraph
and (y) they have received of the audited financial statements referred to in clause (a) above for the 2019, 2020 and 2021 fiscal
years.
7. Investment
banks (the “Investment Banks”) reasonably satisfactory to the Lead Arrangers shall have been engaged to privately
place the Notes.
8. The
Administrative Agent and the Lead Arrangers shall have received at least three business days prior to the Closing Date all documentation
and other information about the Borrower (and, to the extent the Acquisition is consummated pursuant to a Merger Transaction, the other
Guarantors) as shall have been reasonably requested in writing by the Administrative Agent or the Lead Arrangers at least ten calendar
days prior to the Closing Date and as required by regulatory authorities under applicable “know your customer” and anti-money
laundering rules and regulations, including without limitation the PATRIOT Act and (b) if the Borrower qualifies as a “legal
entity” customer under 31 C.F.R. § 1010.230 and the Administrative Agent has provided the Borrower the name of each requesting
Lender and its electronic delivery requirements at least 10 calendar days prior to the Closing Date, the Administrative Agent and each
such Lender requesting a Beneficial Ownership Certification (which request is made through the Administrative Agent) will have received,
at least three business days prior to the Closing Date, the Beneficial Ownership Certification in relation to the Borrower.
9. Subject
in all respects to the Funding Conditions Provisions, (a) the Intercreditor Agreement and Guarantees shall have been executed and
be in full force and effect or substantially simultaneously with the initial borrowing under the Term Loan Facility, shall be executed
and become in full force and effect, (b) with respect to the Term Loan Facility, all documents and instruments required to create
or perfect the Bank Administrative Agent’s security interest in the Collateral shall have been executed and delivered by each Credit
Party party thereto and, if applicable, be in proper form for filing and (c) with respect to the Secured Bridge Facility, all documents
and instruments required to create or perfect the Secured Bridge Administrative Agent’s security interest in the Collateral shall
have been executed and delivered by each Credit Party party thereto and, if applicable, be in proper form for filing.
10. Subject
in all respects to the Funding Conditions Provisions, (a) the Bank Facilities Documentation and, if applicable, the Secured Bridge
Facility Documentation and the Unsecured Bridge Facility Documentation (collectively, the “Facilities Documentation”)
(which shall, in each case, be in accordance with the terms of the Commitment Letter and the Term Sheets and the Documentation Principles,
the Secured Bridge Documentation Principles or the Unsecured Bridge Documentation Principles, as applicable) shall have been executed
and delivered by the Credit Parties and (b) customary legal opinions, customary officer’s closing certificates (including incumbency
certificates of officers), organizational documents, customary evidence of authorization and good standing certificates in jurisdictions
of formation/organization, in each case with respect to the Borrower and the Guarantors (to the extent applicable), customary requests
for borrowing and a solvency certificate (as of the Closing Date after giving effect to the Transactions and substantially in the form
of Annex E-I attached hereto, certified by a senior authorized financial officer of the Borrower) shall have been delivered to the Lead
Arrangers.
***
Form of Solvency Certificate
Date: _____
Reference is made to Credit
Agreement, dated as of [●] (the “Credit Agreement”), among [●] (the “Borrower”),
the lending institutions from time to time parties thereto (the “Lenders”), and [●], as Administrative
Agent and Collateral Agent.
Capitalized terms used but
not otherwise defined herein shall have the meanings assigned to them in the Credit Agreement. This certificate is furnished pursuant
to Section [●] of the Credit Agreement.
Solely in my capacity as a
financial executive officer of the Borrower and not individually (and without personal liability), I hereby certify, that as of the
date hereof, after giving effect to the consummation of the Transactions:
| 1. | The sum of the liabilities (including contingent liabilities) of the Borrower and its restricted subsidiaries,
on a consolidated basis, does not exceed the present fair saleable value of the present assets of the Borrower and its restricted subsidiaries,
on a consolidated basis. |
| 2. | The fair value of the property of the Borrower and its restricted subsidiaries, on a consolidated basis,
is greater than the total amount of liabilities (including contingent liabilities) of the Borrower and its restricted subsidiaries, on
a consolidated basis as such liabilities become absolute and mature. |
| 3. | The capital of the Borrower and its restricted subsidiaries, on a consolidated basis, is not unreasonably
small in relation to their business as contemplated on the date hereof. |
| 4. | The Borrower and its restricted subsidiaries, on a consolidated basis, have not incurred and do not intend
to incur, or believe that they will incur, debts including current obligations beyond their ability to pay such debts as they become due
(whether at maturity or otherwise). |
For purposes of this Certificate,
the amount of any contingent liability has been computed as the amount that, in light of all of the facts and circumstances existing as
of the date hereof, represents the amount that would reasonably be expected to become an actual or matured liability.
IN WITNESS WHEREOF, I
have executed this Certificate this as of the date first written above.
|
[BORROWER] |
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By: |
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Name: |
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Title: |
EXHIBIT 99.I
EXHIBIT I
EXECUTION VERSION
|
MORGAN STANLEY
SENIOR FUNDING, INC.
1585 Broadway
New York, NY 10036 |
|
CONFIDENTIAL
April 25, 2022
X Holdings III, LLC
c/o Elon R. Musk
2110 Ranch Road 620 S. #341886
Austin, TX 78734
Project X
Commitment Letter
Ladies and Gentlemen:
You have advised Morgan Stanley
Senior Funding, Inc. (“MSSF”), Bank of America, N.A. (“BOFA”), Barclays Bank
plc (“Barclays”), MUFG Bank, Ltd. (“MUFG”), Credit Suisse AG, Cayman Islands
Branch (“CS”), BNP Paribas (“BNPP”), Citibank, N.A. (“Citi”),
Deutsche Bank AG, London Branch (“DB”), Mizuho Bank, Ltd. (“Mizuho”), Royal
Bank of Canada (“RBC”), Société Générale (“SG”), and
Canadian Imperial Bank of Commerce (“CIBC” and, together with MSSF, BOFA, Barclays, MUFG, CS, BNPP, Citi, DB,
Mizuho, RBC, and SG, “we,” “us” or a “Commitment Party”
and, together with any other commitment party that becomes a party hereto pursuant to Section 2 hereof collectively, the “Commitment
Parties”) that X Holdings III, LLC, a Delaware limited liability company (the “Borrower” or “you”),
formed at the direction of, and to be controlled directly or indirectly by or under common control with, certain funds, partnerships
and other entities advised, managed or controlled by the Principal (the “Guarantor” and, together with certain
of his affiliates, collectively, the “Sponsor”), intends to obtain funds such that Sponsor may acquire, directly
or indirectly, all of the outstanding equity interests of (the “Common Stock Interests”) or, directly or indirectly,
merge with, Twitter, Inc. (the “Issuer”) (the “Acquisition”). It is intended
that a portion of the financing for the Acquisition may, at your election, include a margin loan facility (the “Facility”)
in an aggregate principal amount of up to $12,500.0 million (as may be decreased (but not increased) by the Borrower as set forth herein,
the “Maximum Facility Amount”). Capitalized terms used but not defined herein shall have the meanings assigned
to them in the Summaries of Principal Terms and Conditions attached hereto as Exhibit A (the “Term Sheet”
and this commitment letter, the Term Sheet and the Conditions Annex (as defined below), collectively, the “Commitment Letter”).
All references to “dollars” or “$” in this Commitment Letter and the Fee Letter (as
defined below) are references to U.S. dollars.
In connection with the Acquisition,
each of MSSF, BOFA, Barclays, MUFG, CS, BNPP, Citi, DB, Mizuho, RBC, SG, and CIBC (together with any other initial lender that becomes
a party hereto pursuant to Section 2 hereof, the “Initial Lenders” and, each, an “Initial
Lender”) is pleased to advise you of its commitment to provide you with the principal amount of the Facility and commitments
as set forth opposite its name on Schedule I hereto (each a “Funding Commitment”) and subject only to
the satisfaction (or waiver) of the conditions set forth on Exhibit B (the “Conditions Annex”);
provided that you may, at your election, decrease the Funding Commitments of the Initial Lenders on a pro rata basis in accordance
with this Commitment Letter. The aggregate Funding Commitments of the Initial Lenders may not exceed the Maximum Facility Amount at any
time.
Each Initial Lender’s
Funding Commitment will be effective from the date all Initial Lenders have signed this Commitment Letter (such date, the “Lender
Effective Date”). Your obligations under this Commitment Letter will not become effective until the date you return to
the Joint Bookrunners (or their counsel) an executed counterpart hereof (such date, the “Countersign Effective Date”).
Subject to the occurrence
of the Termination Date (as defined in Section 10), commencing on the Lender Effective Date, the Initial Lenders’ Funding
Commitments will remain available to the Borrower until 11:59 p.m., New York City time, on May 4, 2022 (the “Countersign
Expiration Time”); provided that commencing on the Countersign Effective Date, the Initial Lender’s Funding
Commitments will remain available to the Borrower during the Availability Period (as defined below); provided, further,
that, if you have not returned to the Joint Bookrunners (or their counsel) an executed counterpart of this Commitment Letter by the Countersign
Expiration Time, each Initial Lender’s respective Funding Commitment will expire at such time.
On or prior to the Countersign
Effective Date or at any time thereafter, you or the Guarantor may elect, by written notice to the Joint Bookrunners (which may be electronic
notice), to decrease (but not increase) the Maximum Facility Amount. Any such decrease to the Maximum Facility Amount will be applied
to the Initial Lenders’ respective Funding Commitments on a pro rata basis.
“Availability
Period” means the period from, and including, the Countersign Effective Date until, but excluding, the day that is one
calendar month following the Countersign Effective Date (the “Commitment Expiration Date”); provided
that the then-effective Commitment Expiration Date may be extended from, and including, such Commitment Expiration Date until, but
excluding, the day that is one calendar month following such Commitment Expiration Date at the election of the Borrower by written
notice to the Joint Bookrunners no later than two business days prior to such Commitment Expiration Date (each such extension, a
“Commitment Expiration Extension”); provided, further, that there may not be more than eleven
(11) Commitment Expiration Extensions; provided, further, that notwithstanding anything contained herein, the
Availability Period shall expire not later than April 24, 2023.
It is agreed that (i) Morgan
Stanley Bank, N.A. will act as lead arranger for the Facility (the “Lead Arranger” and together with any other
lead arranger appointed pursuant to this Section 2, the “Lead Arrangers”), (ii) MSSF will act as
joint bookrunner for the Facility (together with any other bookrunner appointed pursuant to this Section 2 and together with the
Lead Arrangers, each a “Joint Bookrunner” and, collectively, the “Joint Bookrunners”),
(iii) MSSF or a third party agent designated by the Borrower with the approval of the Joint Bookrunners (not to be unreasonably
withheld or delayed) will act as administrative agent for the Facility (in such capacity, the “Administrative Agent”)
and (iv) Morgan Stanley & Co. LLC will act as calculation agent (the “Calculation Agent”).
You agree that no other agents,
co-agents, arrangers or bookrunners will be appointed, no other titles will be awarded and no compensation (other than compensation expressly
contemplated by this Commitment Letter and the Fee Letter referred to below) will be required to be paid to any Lender (as defined in
the Term Sheet) expressly in order to obtain its commitment to participate in the Facility unless you and the Joint Bookrunners shall
so agree.
You hereby represent and
warrant that (as to the Issuer and its subsidiaries and businesses, to your knowledge), (a) all written factual information and
written factual data (such information, other than financial information and projections, financial estimates, forecasts and other forward-looking
information, collectively, the “Projections” and other than information of a general economic or industry specific
nature, the “Information”), that has been or will be made available to any Commitment Party by you or by any
of your representatives on your behalf in connection with the Acquisition contemplated hereby, when taken as a whole after giving effect
to all supplements and updates provided thereto, does not or will not, when furnished, and when taken as a whole and together with the
Issuer’s public filings with the Securities and Exchange Commission (other than any portions thereof under the “risk factors”
section or other cautionary language) contain any untrue statement of a material fact or omit to state a material fact necessary in order
to make the statements contained therein, when taken as a whole, not materially misleading in light of the circumstances under which
such statements are made and (b) the Projections that have been or will be made available to any Commitment Party by you or by any
of your representatives on your behalf in connection with the Acquisition contemplated hereby, when taken as a whole, have been, or will
be, prepared in good faith based upon assumptions that are believed by you to be reasonable at the time prepared and at the time the
related Projections are so furnished; it being understood that the Projections are as to future events and are not to be viewed as facts,
the Projections are subject to significant uncertainties and contingencies, many of which are beyond your or the Sponsor’s control,
that no assurance can be given that any particular Projections will be realized and that actual results during the period or periods
covered by any such Projections may differ significantly from the projected results and such differences may be material. You agree that,
if at any time prior to the initial funding of the Facility (the “Funding Date”), you become aware that any
of the representations and warranties in the preceding sentence would be incorrect in any material respect if the Information and the
Projections were being furnished, and such representations were being made, at such time, then you will use commercially reasonable efforts
to promptly supplement the Information and the Projections such that (with respect to the Information and the Projections relating to
the Issuer and its subsidiaries, to your knowledge) such representations and warranties are true and correct in all material respects
under those circumstances, it being understood in each case that such supplementation shall cure any breach of such representations and
warranties. You understand that in arranging and syndicating the Facility we may use and rely on the Information and Projections without
independent verification thereof.
Notwithstanding anything
to the contrary contained in this Commitment Letter or the Fee Letter, none of the making of the foregoing representations, any supplements
thereto, or the accuracy of any such representations and warranties, whether or not cured, shall constitute a condition precedent to
the availability of the commitments and obligations of the Initial Lenders hereunder or the funding of the Facility on the Funding Date.
As consideration for the
commitments of the Initial Lenders hereunder and for the agreement of the Joint Bookrunners to perform the services described herein,
you agree to pay (or cause to be paid) the fees set forth in the Term Sheet and in the Fee Letter dated the date hereof and delivered
herewith with respect to the Facility (the “Fee Letter”), if and to the extent payable. Once paid, such fees
shall not be refundable under any circumstances except as provided in the Fee Letter or otherwise expressly agreed in writing.
The commitments of the Initial
Lenders hereunder to fund the Facility on the Funding Date and the agreements of the Joint Bookrunners to perform the services described
herein are subject solely to the conditions set forth in the Conditions Annex. There are no conditions (implied or otherwise) to the
commitments hereunder, and there will be no conditions (implied or otherwise) under the Facility documentation to the initial funding
of the Facility on the Funding Date, including compliance with the terms (but not the conditions) of this Commitment Letter, the Fee
Letter and the Facility documentation, other than those that are expressly set forth in the Conditions Annex.
You agree (a) to indemnify
and hold harmless each Commitment Party, its respective affiliates and its and their respective officers, members, directors, employees,
agents, advisors and controlling persons and assigns (each, an “Indemnified Person”), from and against any
and all losses, claims, damages and liabilities of any kind or nature, joint or several, to which any such Indemnified Person may become
subject to the extent arising out of or in connection with any actual or threatened claim, litigation, investigation or proceeding resulting
from this Commitment Letter (including the Term Sheet), the Fee Letter, the Acquisition, the Facility or any use of the proceeds thereof
(any of the foregoing, a “Proceeding”), regardless of whether any such Indemnified Person is a party thereto,
whether or not such Proceedings are brought by you, your equity holders, affiliates, creditors, the Issuer or any other third person,
and to reimburse each such Indemnified Person upon demand for any reasonable and documented and invoiced out-of-pocket legal expenses
of one firm of counsel for all such Indemnified Persons, taken as a whole and, if necessary, of a single local counsel in each appropriate
jurisdiction (which may include a single special counsel acting in multiple jurisdictions) material to the interests of all such Indemnified
Persons, taken as a whole (and, in the case of an actual or perceived conflict of interest where the Indemnified Persons affected by
such conflict notifies you thereof and, with your consent (such consent not to be unreasonably withheld or delayed), retains their own
counsel and informs you, of another firm of counsel for such affected Indemnified Persons and each similarly situated Indemnified Person,
taken as a whole) (or otherwise as agreed by the Borrower) and other reasonable and documented and invoiced out-of-pocket fees and expenses
incurred in connection with investigating or defending any of the foregoing (but in the case of fees and expenses of any other advisor
or consultant, solely to the extent you have consented to the retention of such person (such consent not to be unreasonably withheld
or delayed)); provided that the foregoing indemnity will not, as to any Indemnified Person, apply to losses, claims, damages,
liabilities or related expenses to the extent that they have resulted from (i) the fraud, willful misconduct, bad faith or gross
negligence of such Indemnified Person or any of such Indemnified Person’s controlled and controlling affiliates or any of its or
their respective officers, members, directors, employees, agents, advisors and controlling persons and assigns (as determined by a court
of competent jurisdiction in a final and non-appealable decision), (ii) a material breach of the obligations of such Indemnified
Person or any of such Indemnified Person’s affiliates under this Commitment Letter, the Term Sheet or the Fee Letter (as determined
by a court of competent jurisdiction in a final and non-appealable decision) or (iii) any Proceeding that does not involve an act
or omission by you or any of your affiliates and that is brought by an Indemnified Person against any other Indemnified Person (other
than any claims against a Commitment Party in its capacity or in fulfilling its role as an Administrative Agent, Calculation Agent, arranger
or any similar role under the Facility to the extent none of the exceptions in clauses (i) and (ii) of this proviso would apply)
and (b) if and only if the Funding Date occurs, to reimburse each Commitment Party on the Funding Date, upon presentation of a summary
statement, for all reasonable and documented and invoiced out-of-pocket expenses and reasonable documented and invoiced fees, disbursements
and other charges of counsel to the Administrative Agent, the Calculation Agent and of a single local counsel to the Commitment Parties
in each appropriate jurisdiction (which may include a single special counsel acting in multiple jurisdictions) (and, in the case of an
actual or perceived conflict of interest where the Indemnified Person affected by such conflict retains its own counsel and informs you,
of another firm of counsel for such affected Indemnified Person) and of such other counsel retained with your prior written consent (which
consent shall not be unreasonably withheld, delayed or conditioned) or retained in connection with enforcement of this Commitment Letter
or the Fee Letter, in each case incurred in connection with the Facility and the preparation, negotiation and enforcement of this Commitment
Letter, the Fee Letter, the Facility documentation and any security arrangements in connection therewith (collectively, the “Expenses”).
The foregoing provisions in this paragraph shall be superseded in each case, to the extent covered thereby, by the applicable provisions
contained in the Facility documentation upon execution thereof and thereafter shall have no further force and effect.
You shall not, without the
prior written consent of any Indemnified Person affected thereby (which consent shall not be unreasonably withheld or delayed) (it being
understood that the withholding of consent due to non-satisfaction of any conditions described in clauses (i) and (ii) of this
sentence shall be deemed reasonable), effect any settlement of any pending or threatened proceedings in respect of which indemnity could
have been sought hereunder by such Indemnified Person unless such settlement (i) includes an unconditional release of such Indemnified
Person in form and substance reasonably satisfactory to such Indemnified Person from all liability or claims that are the subject matter
of such proceedings and (ii) does not include any statement as to or any admission of fault, culpability or a failure to act by
or on behalf of any Indemnified Person. Each Indemnified Person shall be severally obligated to refund or return any and all amounts
paid by you under this Section 7 to the extent such Indemnified Person is not entitled to payment of such amounts in accordance
with the terms hereof as determined by a final, non-appealable judgment of a court of competent jurisdiction.
You shall not be liable for
any settlement of any Proceeding effected without your consent (which consent shall not be unreasonably withheld, conditioned or delayed),
but if settled with your written consent or if there is a final and non-appealable judgment by a court of competent jurisdiction for
the plaintiff in any such Proceeding, you agree to indemnify and hold harmless each Indemnified Person from and against any and all losses,
claims, damages, liabilities and expenses by reason of such settlement or judgment in accordance with and to the extent provided in the
other provisions of this Section 7.
Each Indemnified Person shall
give (subject to restrictions pursuant to attorney-client privilege, law, rule or regulation, or any obligation of confidentiality)
such information and assistance to you as you may reasonably request in connection with any Proceeding in connection with any losses,
claims, damages, liabilities and expenses, unless the Indemnified Person reasonably determines there are actual or potential conflicts
of interest between you and the Indemnified Person.
Notwithstanding any other
provision of this Commitment Letter or the Fee Letter, (i) neither you, nor any of your affiliates nor any Indemnified Person shall
be liable for any damages arising from the use by others of information or other materials obtained through internet, electronic, telecommunications
or other information transmission systems, except to the extent that such damages have resulted from the fraud, willful misconduct, bad
faith or gross negligence of, or a material breach of the obligations under this Commitment Letter, the Term Sheet or the Fee Letter
by, such Person or any of such Person’s affiliates or any of its or their respective officers, directors, employees, agents, advisors,
controlling persons or other representatives (as determined by a court of competent jurisdiction in a final and non-appealable decision)
and (ii) none of we, you, any of your affiliates, the Issuer (or its subsidiaries) or any Indemnified Person shall be liable for
any indirect, special, punitive or consequential damages in connection with this Commitment Letter, the Fee Letter, the Acquisition (including
the Facility and the use of proceeds thereunder), or with respect to any activities related to the Facility, including the preparation
of this Commitment Letter, the Fee Letter and the Facility documentation; provided that nothing contained in this paragraph shall
limit your indemnity and reimbursement obligations to the extent that such indirect, special, punitive or consequential damages are included
in any claim by a third party unaffiliated with any of the Commitment Parties with respect to which the applicable Indemnified Person
is entitled to indemnification pursuant to the third immediately preceding paragraph.
It is further agreed that
the Initial Lenders shall be liable in respect of their respective commitments to the Facility on a several, and not joint, basis with
any other Initial Lender, and no Initial Lender shall be responsible for the commitment of any other Initial Lender.
This Commitment Letter is
delivered to you on the understanding that none of the Fee Letter and its terms or substance, or, prior to your acceptance hereof, this
Commitment Letter and its terms or substance or the activities of any Commitment Party pursuant hereto or to the Fee Letter, shall be
disclosed, directly or indirectly, to any other person or entity (including other lenders, underwriters, placement agents, advisors or
any similar persons) except (a) to the Sponsor, and to your and any of the Sponsor’s subsidiaries and affiliates and your
and their respective officers, directors, employees, agents, attorneys, accountants, advisors and controlling persons who are informed
of the confidential nature thereof, on a confidential and need-to-know basis, (b) if the Commitment Parties consent to such proposed
disclosure (such consent not to be unreasonably withheld or delayed) or (c) pursuant to the order of any court or administrative
agency in any pending legal or administrative proceeding, or otherwise as required by applicable law, rule or regulation or compulsory
legal process or to the extent requested or required by governmental and/or regulatory authorities or the rules of any applicable
stock exchange (in which case, you agree, to the extent practicable and not prohibited by applicable law, rule or regulation, to
inform us promptly thereof); provided that (i) you may disclose this Commitment Letter and the contents hereof (and, to the
extent provisions thereof have been redacted in a manner reasonably satisfactory to us, the Fee Letter) to the Issuer and its officers,
directors, employees, agents, attorneys, accountants, advisors and controlling persons, on a confidential and need-to-know basis, (ii) you
may disclose the Commitment Letter (but not the Fee Letter) and its contents in any syndication or other marketing materials in connection
with the Facility or in connection with any public or regulatory filing requirement relating to the Acquisition, (iii) you may disclose
the Term Sheet and the other exhibits and annexes to the Commitment Letter (but not the Fee Letter) and the contents thereof, to potential
Initial Lenders and their affiliates involved in the related commitments, to equity investors and to rating agencies in connection with
obtaining ratings for the Borrower and the Facility, (iv) you may disclose the aggregate fees contained in the Fee Letter as part
of Projections, pro forma information or a generic disclosure of aggregate sources and uses related to fee amounts related to the Acquisition
to the extent customary or required in offering and marketing materials for the Facility or in any public or regulatory filing requirement
relating to the Acquisition, (v) you may disclose this Commitment Letter (but not the Fee Letter) in any tender offer or proxy relating
to the Acquisition, (vi) you may disclose the Commitment Letter and the contents thereof to the extent its terms or substance becomes
publicly available other than by reason of your violation of the terms of this Commitment Letter and (vii) you may disclose the
Fee Letter and the contents thereof to any prospective additional Commitment Party or prospective equity investor and their respective
officers, directors, employees, attorneys, accountants and advisors, in each case on a confidential basis. You agree that you will permit
us to review and approve (such approval not to be unreasonably withheld or delayed) any reference to us or any of our affiliates in connection
with the Facility or the transaction contemplated hereby contained in any press release (or other written public statement that references
any Commitment Party or affiliate thereof by name) prior to public release. The confidentiality provisions set forth in this paragraph
shall survive the termination of this Commitment Letter and expire and shall be of no further effect after the second anniversary of
the Lender Effective Date.
Each Commitment Party and
its affiliates will use all non-public information provided to any of them or such affiliates by or on behalf of you hereunder or in
connection with the Acquisition solely for the purpose of providing the services which are the subject of this Commitment Letter and
negotiating, evaluating and consummating the transactions contemplated hereby and shall treat confidentially all such information and
shall not publish, disclose or otherwise divulge such information; provided that nothing herein shall prevent such Commitment Party and
its affiliates from disclosing any such information (a) pursuant to the order of any court or administrative agency or in any pending
legal, judicial or administrative proceeding, or otherwise as required by applicable law, rule or regulation or compulsory legal
process (in which case such Commitment Party agrees (except with respect to any routine or ordinary course audit or examination conducted
by bank accountants or any governmental, bank regulatory or self-regulatory authority exercising examination or regulatory authority),
to the extent practicable and not prohibited by applicable law, rule or regulation, to inform you promptly thereof prior to disclosure),
(b) upon the request or demand of any regulatory authority (including any self-regulatory authority) having jurisdiction over such
Commitment Party or any of its affiliates (in which case such Commitment Party agrees (except with respect to any routine or ordinary
course audit or examination conducted by bank accountants or any governmental, bank regulatory or self-regulatory authority exercising
examination or regulatory authority) to the extent practicable and not prohibited by applicable law, rule or regulation, to inform
you promptly thereof prior to disclosure), (c) to the extent that such information becomes publicly available other than by reason
of improper disclosure by such Commitment Party or any of its affiliates or any related parties thereto in violation of any confidentiality
obligations owing to you, the Sponsor, the Issuer or any of your or their respective subsidiaries or affiliates or related parties, (d) to
the extent that such information is received by such Commitment Party from a third party that is not, to such Commitment Party’s
knowledge, subject to confidentiality obligations owing to you, the Issuer or any of your or their respective subsidiaries or affiliates
or related parties, (e) to the extent that such information was already in our possession prior to any duty or other undertaking
of confidentiality or is independently developed by the Commitment Parties without the use of such information, (f) to other Commitment
Parties and such Commitment Party’s affiliates and to its and their respective officers, directors, partners, employees, legal
counsel, independent auditors and other experts, advisors or agents who need to know such information in connection with the Acquisition
and who are informed of the confidential nature of such information and who are subject to customary confidentiality obligations of professional
practice or who agree to be bound by the terms of this paragraph (or language substantially similar to this paragraph) (with each such
Commitment Party, to the extent within its control, responsible for such person’s compliance with this paragraph), (g) to
potential or prospective Initial Lenders, hedge providers, participants or assignees, in each case who agree (pursuant to customary syndication
practice) to be bound by the terms of this paragraph (or language substantially similar to this paragraph); provided that the
disclosure of any such information to any Initial Lenders, hedge providers or prospective Initial Lenders, hedge providers or participants
or prospective participants referred to above shall be made subject to the acknowledgment and acceptance by such Initial Lender, hedge
provider or prospective Initial Lenders or participant or prospective participant that such information is being disseminated on a confidential
basis (on substantially the terms set forth in this paragraph or as is otherwise reasonably acceptable to you and each Commitment Party,
including, without limitation, as agreed in any information materials or other marketing materials) in accordance with the standard syndication
processes of such Commitment Party or customary market standards for dissemination of such type of information, which shall in any event
require “click through” or other affirmative actions on the part of recipient to access such information, (h) for purposes
of establishing a “due diligence” defense or (i) subject to your prior approval of the information to be disclosed,
to rating agencies in connection with obtaining ratings for the Borrower or the Facility. In addition, each Commitment Party may disclose
the existence of the Facility to market data collectors, similar service providers to the lending industry and service providers to the
Commitment Parties in connection with the administration and management of the Facility. In the event that the Facility is funded, the
Commitment Parties’ and their respective affiliates’, if any, obligations under this paragraph, shall terminate automatically
and be superseded by the confidentiality provisions in the Facility documentation upon the initial funding thereunder to the extent that
such provisions are binding on such Commitment Parties. Otherwise, the confidentiality provisions set forth in this paragraph shall survive
the termination of this Commitment Letter and expire and shall be of no further effect after the second anniversary of the Lender Effective
Date.
THIS COMMITMENT LETTER
AND ANY CLAIM, CONTROVERSY OR DISPUTE ARISING UNDER OR RELATED TO THIS COMMITMENT LETTER SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED
IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK without regard to principles of conflicts
of law to the extent that the application of the laws of another jurisdiction would be required thereby.
Each of the parties hereto
hereby irrevocably and unconditionally (a) submits, for itself and its property, to the exclusive jurisdiction of any New York State
court or Federal court of the United States of America sitting in the Borough of Manhattan in the City of New York, and any appellate
court from any thereof, in any action or proceeding arising out of or relating to this Commitment Letter, the Fee Letter or the transactions
contemplated hereby or thereby, or for recognition or enforcement of any judgment, and agrees that all claims in respect of any such
action or proceeding shall be heard and determined in such New York State court or, to the extent permitted by law, in such Federal court,
(b) waives, to the fullest extent it may legally and effectively do so, any objection which it may now or hereafter have to the
laying of venue of any suit, action or proceeding arising out of or relating to this Commitment Letter, the Fee Letter or the transactions
contemplated hereby or thereby in any such New York State court or in any such Federal court, (c) waives, to the fullest extent
permitted by law, the defense of an inconvenient forum to the maintenance of such action or proceeding in any such court and (d) agrees
that a final judgment in any such suit, action or proceeding shall be conclusive and may be enforced in other jurisdictions by suit on
the judgment or in any other manner provided by law. Each of the parties hereto agrees that service of process, summons, notice or document
by registered mail addressed to you or the Joint Bookrunners at the addresses set forth above shall be effective service of process for
any suit, action or proceeding brought in any such court.
EACH OF THE PARTIES HERETO
IRREVOCABLY WAIVES THE RIGHT TO TRIAL BY JURY IN ANY ACTION, PROCEEDING, CLAIM OR COUNTERCLAIM BROUGHT BY OR ON BEHALF OF ANY PARTY RELATED
TO OR ARISING OUT OF THIS COMMITMENT LETTER OR THE FEE LETTER OR THE PERFORMANCE OF SERVICES HEREUNDER OR THEREUNDER.
This Commitment Letter and
the commitments hereunder shall not be assignable by any party hereto (other than by you to another newly formed shell entity organized
and existing under the laws of a state of the United States, or another jurisdiction to be agreed between you and us, which is an affiliate
of and will be controlled by the Sponsor that consummates or intends to consummate the Acquisition) without the prior written consent
of each other party hereto (which consent shall not be unreasonably withheld, delayed or conditioned) (and any attempted assignment without
such consent shall be null and void). This Commitment Letter and the commitments hereunder are, and are intended to be, solely for the
benefit of the parties hereto (and Indemnified Persons to the extent expressly set forth herein) and do not, and are not intended to,
confer any benefits upon, or create any rights in favor of, any person other than the parties hereto (and Indemnified Persons to the
extent expressly set forth herein). The Commitment Parties may assign any of their respective commitments or delegate any or all of their
respective rights and obligations hereunder to any of their affiliates and reserve the right to employ the services of their respective
affiliates or branches in providing services contemplated hereby (each such affiliate or branch, a “Delegate”)
and to allocate, in whole or in part, to their respective Delegates certain fees payable to the Commitment Parties in such manner as
the Commitment Parties and their respective Delegates may agree in their sole discretion and, to the extent so employed, such Delegates
shall be entitled to the benefits and protections afforded to, and subject to the provisions governing the conduct of the Commitment
Parties hereunder; provided that the applicable Commitment Party shall remain liable to the Borrower for the performance of such
rights and obligations by its Delegate and shall not be relieved, released or novated from its obligations hereunder (including its obligation
to fund the Facility on the date of the consummation of the Acquisition with the proceeds of the initial funding under the Facility).
This Commitment Letter may
not be amended or any provision hereof waived or modified except by an instrument in writing signed by each of the Commitment Parties
and you. This Commitment Letter may be executed in any number of counterparts, each of which shall be deemed an original and all of which,
when taken together, shall constitute one agreement. Delivery of an executed counterpart of a signature page of this Commitment
Letter by facsimile, scan, photograph or other electronic transmission shall be effective as delivery of a manually executed counterpart
hereof. The words “execution”, “signed”, “signature” and words of like import herein shall be deemed
to include electronic signatures, the electronic matching of assignment terms and contract formations on the electronic platform DocuSign,
digital copies of a signatory’s manual signature, and deliveries or the keeping of records in electronic form, each of which shall
be of the same legal effect, validity or enforceability as a manually executed signature to the extent and as provided for in any applicable
law, including the Federal Electronic Signatures in Global and National Commerce Act, the New York State Electronic Signatures and Records
Act, or any other similar state laws based on the Uniform Electronic Transactions Act. This Commitment Letter (including the exhibits
hereto), together with the Fee Letter, (i) are the only agreements that have been entered into among the parties hereto with respect
to the commitments relating to the Facility and (ii) supersede all prior understandings, whether written or oral, among the Joint
Bookrunners with respect to the Facility and set forth the entire understanding of the parties hereto with respect thereto.
Each Commitment Party represents
and warrants that this Commitment Letter and the Fee Letter constitute its legally valid and binding obligation (except as may be limited
by bankruptcy, insolvency, reorganization, fraudulent conveyance or transfer, moratorium or other similar laws relating to or affecting
the rights of creditors generally), including (i) to provide services set forth herein, in the case of the Joint Bookrunners, and
fund its commitment under the Facility upon satisfaction (or waiver) of the conditions precedent as provided herein in Section 6,
in the case of the Initial Lenders, and (ii) to negotiate in good faith the Facility documentation in a manner consistent with this
Commitment Letter, in each case, enforceable at law and in equity in accordance with their terms and subject only to the conditions precedent
as provided herein in Section 6. You represent and warrant that this Commitment Letter and the Fee Letter constitute your legally
valid and binding obligations (except as may be limited by bankruptcy, insolvency, reorganization, fraudulent conveyance or transfer,
moratorium or other similar laws relating to or affecting the rights of creditors generally), enforceable at law and in equity against
you in accordance with their terms; provided that nothing contained in this Commitment Letter or the Fee Letter obligates you
or any of your affiliates to consummate Acquisition or to draw upon all or any portion of the Facility.
Each Commitment Party acknowledges
that the Principal owns common stock of Tesla, Inc. that are not pledged to secure any outstanding obligations and will not be pledged
to secure the Facility (the “Unpledged Shares”). Each Commitment Party further acknowledges that the Principal
may sell, dispose of or transfer such Unpledged Shares at any time in accordance with applicable securities laws.
We hereby notify you that
pursuant to the requirements of the USA PATRIOT Act (Title III of Pub. L. 107-56 (signed into law October 26, 2001)) (the “PATRIOT
Act”) and of 31 C.F.R. § 1010.230 (as amended, the “Beneficial Ownership Regulations”),
each of the Joint Bookrunners and each of the Initial Lenders may be required to obtain, verify and record information that identifies
the Borrower and the Guarantor, which information may include their names, addresses, tax identification numbers and other information
that will allow each of the Joint Bookrunners and the Initial Lenders to identify the Borrower and the Guarantor in accordance with the
PATRIOT Act and the Beneficial Ownership Regulations. This notice is given in accordance with the requirements of the PATRIOT Act and
the Beneficial Ownership Regulations and is effective for each of the Joint Bookrunners and the Initial Lenders.
The indemnification, compensation
(if applicable), reimbursement (if applicable), information (if applicable), payment of fees, jurisdiction, governing law, venue, waiver
of jury trial, absence of fiduciary relationships, survival and confidentiality provisions (if applicable) contained herein and in the
Fee Letter shall remain in full force and effect regardless of whether Facility documentation shall be executed and delivered and notwithstanding
the termination or expiration of this Commitment Letter or the Initial Lenders’ commitments hereunder; provided that your
obligations under this Commitment Letter (other than your obligations with respect to confidentiality of the Fee Letter and the contents
thereof) shall automatically terminate and be superseded by the provisions of the Facility documentation upon the initial funding thereunder,
and you shall automatically be released from all liability in connection therewith at such time.
Section headings used
herein are for convenience of reference only and are not to affect the construction of, or to be taken into consideration in interpreting,
this Commitment Letter.
If the foregoing correctly
sets forth our agreement, please indicate your acceptance of the terms of this Commitment Letter and of the Fee Letter by returning to
the Joint Bookrunners (or their counsel) executed counterparts hereof and of the Fee Letter not later than the Countersign Expiration
Time. The Initial Lenders’ Funding Commitments and the obligations of the Joint Bookrunners hereunder will expire at such time
in the event that the Joint Bookrunners (or the Joint Bookrunners’ legal counsel) have not received such executed counterparts
in accordance with the immediately preceding sentence.
If you do so execute and
deliver to the Joint Bookrunners (or their counsel) this Commitment Letter and the Fee Letter, the Commitment Parties agree that the
Funding Commitments and the services of the Commitment Parties to be provided hereunder shall be available for you until the earliest
of (such earliest date being the “Termination Date”) (i) the Funding Date, (ii) the consummation
of the Acquisition without the funding of the Facility, (iii) the termination by the Sponsor of the Acquisition and (iv) the
Commitment Expiration Date (as may be extended in accordance with this Commitment Letter). Upon the occurrence of the Termination Date,
this Commitment Letter and the commitments of each of the Commitment Parties hereunder and the agreement of the Joint Bookrunners to
provide the services described herein shall automatically terminate unless each Commitment Party (as to itself) shall, in its discretion,
agree to an extension in writing of its commitment; provided that the termination of any such commitment pursuant to this paragraph
does not prejudice our or your rights and remedies in respect of any breach of this Commitment Letter.
[Signature Pages Follow]
We are pleased to have been given the opportunity
to assist you in connection with the financing for the Acquisition.
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MORGAN STANLEY SENIOR FUNDING, INC. |
|
By: |
/s/ Andrew W. Earls |
|
Name: |
Andrew W. Earls |
|
Title: |
Managing Director |
|
By: |
/s/ Aurelien Bonnet |
|
Name: |
Aurelien Bonnet |
|
Title: |
Director - Authorized Signatory |
|
By: |
/s/ Bradley Diener |
|
Name: |
Bradley Diener |
|
Title: |
Authorized Signatory |
|
By: |
/s/ Michael Gordon |
|
Name: |
Michael Gordon |
|
Title: |
Managing Director |
|
CREDIT SUISSE AG, CAYMAN ISLANDS BRANCH |
|
By: |
/s/ William Brett |
|
Name: |
William Brett |
|
Title: |
Authorized Signatory |
|
By: |
/s/ Tucker Martin |
|
Name: |
Tucker Martin |
|
Title: |
Authorized Signatory |
|
By: |
/s/ Stephan Nawrocki |
|
Name: |
Stephan Nawrocki |
|
Title: |
Managing Director |
|
By: |
/s/ Xavier Mengin |
|
Name: |
Xavier Mengin |
|
Title: |
Global Head of Strategic Equity |
[Project X Commitment
Letter Signature Page]
|
By: |
/s/ Herman Hirsch |
|
Name: |
Herman Hirsch |
|
Title: |
Authorized Signatory |
|
DEUTSCHE BANK AG, LONDON BRANCH |
|
By: |
/s/ Diana Nott |
|
Name: |
Diana Nott |
|
Title: |
Managing Director |
|
By: |
/s/ Joachim Sciard |
|
Name: |
Joachim Sciard |
|
Title: |
Managing Director |
|
By: |
/s/ Raymond Ventura |
|
Name: |
Raymond Ventura |
|
Title: |
Managing Director |
|
By: |
/s/ Glenn Van Allen |
|
Name: |
Glenn Van Allen |
|
Title: |
Authorized Signatory |
|
By: |
/s/ James Masserio |
|
Name: |
James Masserio |
|
Title: |
Managing Director |
|
CANADIAN IMPERIAL BANK OF COMMERCE |
|
By: |
/s/ Brian G. Smith |
|
Name: |
Brian G. Smith |
|
Title: |
Authorized Signatory |
[Project X Commitment Letter Signature Page]
Accepted and agreed to as of
the date first above written:
X HOLDINGS III, LLC
By: |
/s/ Elon R. Musk |
|
Name: |
Elon R. Musk |
|
Title: |
Member |
|
[Project X Commitment Letter Signature Page]
SCHEDULE I
COMMITMENTS
Initial Lender | |
Facility Commitment | | |
Pro Rata Portion | |
Morgan Stanley Senior Funding, Inc. | |
$ | 2,000,000,000 | | |
| 16.0 | % |
Bank of America, N.A. | |
$ | 1,500,000,000 | | |
| 12.0 | % |
Barclays Bank plc | |
$ | 1,500,000,000 | | |
| 12.0 | % |
MUFG Bank, Ltd. | |
$ | 1,500,000,000 | | |
| 12.0 | % |
Credit Suisse AG, Cayman Islands Branch | |
$ | 1,250,000,000 | | |
| 10.0 | % |
BNP Paribas | |
$ | 750,000,000 | | |
| 6.0 | % |
Citibank, N.A. | |
$ | 750,000,000 | | |
| 6.0 | % |
Deutsche Bank AG, London Branch | |
$ | 750,000,000 | | |
| 6.0 | % |
Mizuho Bank, Ltd. | |
$ | 750,000,000 | | |
| 6.0 | % |
Royal Bank of Canada | |
$ | 750,000,000 | | |
| 6.0 | % |
Société Générale | |
$ | 600,000,000 | | |
| 4.8 | % |
Canadian Imperial Bank of Commerce | |
$ | 400,000,000 | | |
| 3.2 | % |
Total: | |
| 12,500,000,000 | | |
| 100 | % |
EXHIBIT A
Project X
Margin Loan Facility
Summary of Principal Terms and Conditions
[To be Attached]
EXHIBIT
A
Summary of Principal Terms and Conditions
GENERAL TERMS: |
Borrower |
X Holdings III, LLC 1 |
Guarantor |
Principal (Full and Unconditional Guarantee) |
Lead Arranger |
Morgan Stanley Bank, N.A. |
Administrative Agent |
Morgan Stanley Senior Funding, Inc. |
Lenders |
A syndicate of lending banks to be determined (other than disqualified lenders) |
Custodian |
Morgan Stanley & Co. LLC |
Calculation Agent and Collateral Agent |
Morgan Stanley & Co. LLC |
Funding Date |
Any time during the Availability Period upon 3 Business Days’
notice
The Market Reference Price used to determine the Number of Shares required
to satisfy the Maximum Initial LTV Level will be determined as of the second Business Day prior to the Funding Date.
|
Loan Amount |
USD 12,500,000,000 across Lenders, provided that the LTV Ratio
on the Funding Date does not exceed the Maximum Initial LTV Level. The Loan Amount will be funded in a term loan on the Funding Date.
The Loan Amount may be decreased at the election of the Borrower as
set forth in the Commitment Letter referred to below.
|
Loan Currency |
USD |
Maturity Date |
3 years from the Funding Date |
Shares |
Ordinary shares of Tesla, Inc. (Bloomberg Ticker: TSLA US Equity) (the “Issuer”) |
Collateral Account |
Shares in an amount equal to the Number of Shares are deposited in
a collateral account (with separate sub-accounts for each Lender) pledged to the Lenders at Custodian in DTC form and free of any lock-up
or selling restrictions other than any restrictions arising as a matter of law (the “Collateral Shares”)
Collateral Agent to control Collateral Account on behalf of Lenders,
and each Lender to have a security interest in the Shares held in or credited to the sub-account of Collateral Account of such Lender
(which shall be a pro rata portion of the Collateral Shares)
No rehypothecation or borrow rights by Custodian or Lenders
|
Number of Shares |
[ ]2 Shares |
Exchange |
Nasdaq Global Select Market |
Use of Proceeds |
To pay a portion of the purchase price to acquire the target company and the fees and expenses incurred in connection with this financing and the other financings for the acquisition of the target company |
|
|
FINANCING TERMS: |
Interest Rate |
Base Rate plus Spread on the outstanding Loan Amount |
Base Rate |
The higher of (i) 3-month Term SOFR and (ii) zero |
Spread |
3.00% |
1
The Borrower will be a bankruptcy-remote newly-formed limited liability company incorporated in the state of Delaware. See “Borrower
Organization Documents” below.
2
To be determined based on the Market Reference Price on the second Business Day prior to Funding Date.
Interest Payment Dates |
Quarterly following the Funding Date to be paid in cash or PIK at the borrower’s election. To the extent that PIK is elected, the interest amount shall be added to the Loan Amount |
Facility Amortization Amount |
5% per annum, paid on the outstanding Loan Amount on each relevant date |
Upfront Fee |
0.5% of the Loan Amount payable on the Funding Date pro rata to each of the Lenders |
|
|
COLLATERAL TERMS: |
LTV Ratio |
Net Obligations divided by the Aggregate Collateral Share Value |
Net Obligations |
Loan Amount plus accrued and unpaid interest minus the amount of Cash Collateral minus the cash value of any Shares sold pursuant to a Permitted Sale Transaction that remain in the Collateral Account pending settlement |
Aggregate Collateral Share Value |
The Market Reference Price multiplied by the number of Collateral Shares (excluding any Collateral Shares sold pursuant to a Permitted Sale Transaction that remain in the Collateral Account pending settlement) |
Market Reference Price |
The official closing price of the Shares on the Exchange on any day multiplied by the Disrupted Day Haircut |
Disrupted Day Haircut |
In the event there are 3 or more consecutive scheduled trading days for the Shares that are Disrupted Days (to be defined), (i) 100% less (ii)(a) 5% multiplied by (b) (x) the number of consecutive Disrupted Days minus (y) one. |
Collateral Shortfall |
If on any day the LTV Ratio exceeds the LTV Margin Call Level, the Borrower shall, within two Business Days, (i) transfer sufficient Additional Collateral to the Collateral Account, (ii) prepay the Loan Amount and/or (iii) sell Collateral Shares (with the proceeds of such sales to be deposited in the Collateral Account and/or applied to prepay the Loan Amount) in order to bring the LTV Ratio to or below the LTV Reset Level |
Maximum Initial LTV Level |
20% |
LTV Margin Call Level |
35% |
LTV Reset Level |
25% |
LTV Release Level |
15% |
Additional Collateral |
USD Cash placed in the Collateral Account. No additional Shares may be pledged after the Funding Date |
Collateral Release |
If, on any day, the LTV Ratio has been lower than or equal to the LTV Release Level for 5 consecutive scheduled trading days, the Borrower can require the Lender to release, with two Business Days’ notice, Collateral Shares for purposes of settling Permitted Sale Transactions or cash from the Collateral Account, provided that no material default, Event of Default, Potential Adjustment Event, Mandatory Prepayment Event or Collateral Shortfall shall have occurred and be continuing immediately prior to, or immediately following, such release and that after such release the LTV Ratio does not exceed the LTV Release Level. |
|
|
REPAYMENT TERMS: |
Loan Repayment |
On each annual anniversary of the Funding Date,
Borrower shall pay the Facility Amortization Amount
On the Maturity Date, Borrower shall repay any
outstanding Loan Amount plus all accrued and unpaid interest thereon and any other outstanding amounts owed
|
Mandatory Prepayment Event |
Typical for a transaction of such nature, including but not limited
to:
§ Share Price Event: The VWAP of the Shares on the Exchange on any day is below 40% of its official closing price on the Funding Date
§
Completion of a Merger Event in respect of the Shares
§
Change of Control of the Issuer
§
Bankruptcy or Insolvency of the Issuer
§
Delisting
§
Nationalization of the Issuer
§
Imposition of transfer restrictions on the Shares
§
Disruption in trading of the Shares or Exchange closure for 5 consecutive scheduled trading days
§
Potential Adjustment Event for which Calculation Agent determines that no adjustment could be made to produce a commercially reasonable
result
§
Change of Control of the Borrower
The Borrower shall repay the Loan Amount outstanding as well as all
accrued and unpaid interest thereon and any Make-Whole Amount after notice is given of a Mandatory Prepayment Event
|
Potential Adjustment Event |
§
Stock split, reverse stock split, or stock dividend of the Shares
§
Announcement of a Tender Offer, Merger Event, Delisting, Nationalization
§
Completion of a Tender Offer in respect of the Shares
§
The 30-day ADTV of the Shares falls below 10 MM shares
§
Any other event that has a diluting effect on the value of the Shares |
Voluntary Prepayment |
Borrower may at any time prepay the loan
in full or in part by providing 3 Business Days’ notice to the Lenders, in an amount equal to $10,000,000 or a whole multiple of
$1,000,000 in excess thereof
In case of any prepayment the Borrower
will pay (i) Loan Amount being prepaid; (ii) any unpaid and accrued interest thereon; (iii) any Make-Whole Amount and (iv) if applicable,
customary breakage costs
|
Make-Whole Amount |
For any prepayments of the Loan Amount made within 18 months of the Funding Date, excluding any Facility Amortization Amount Loan Repayment, an amount equal to (a) the Loan Amount so prepaid, multiplied by (b) the number of calendar days between the relevant prepayment date and the date that is 18 months after the Funding Date divided by 360, multiplied by (c) 50% of the Spread |
Events of Default |
Typical for transaction of such nature and to be limited to the following
(with customary thresholds, exceptions and cure periods):
§
Non-payment of Loan Amount (with no grace period)
§
Non-payment of interest (with a 5-day grace period)
§
Failure to cure a Collateral Shortfall
§
Breach of covenants
§
Breach of obligations
§
Misrepresentation
§
Invalidity, Unlawfulness and Repudiation
§
Failure of Security
§
Insolvency, Insolvency Proceedings or Insolvency Filing by the Borrower
§
Cross-default to indebtedness of affiliates of Borrower (other than Issuer or its subsidiaries) that is secured by Shares
§
A judgment or order for the payment of money against Borrower
§ Any government investigation against Borrower that would reasonably be expected to have a Material Adverse Effect
|
Consequences of Events of Default |
During the continuance of an Event of Default, any Lender may (i) declare its pro rata share of the principal amount of the Loan, all accrued and unpaid interest thereon, the Make-whole Amount (if any) with respect thereto and (ii) failing such payment, exercise remedies against Borrower, including foreclosing on any and all collateral then credited to its sub-account of the Collateral Account |
|
|
OTHER TERMS: |
Dividends |
Any distribution with respect to the Collateral Shares (ordinary or extraordinary, cash or non-cash dividends or other distributions) to be received into the Collateral Account, pledged to Lenders |
Permitted Sale Transaction |
Borrower can sell Collateral Shares at any time subject to the following
constraints:
§
Such sale is effected on an arm’s length basis
§
The proceeds will be deposited to the Collateral Account or applied to prepay the Lenders on a pro rata basis
§
No Mandatory Prepayment Event, Potential Adjustment Event or Event of Default exists or would immediately result therefrom
|
Security Structure |
New York law pledge over the Collateral Shares in the Collateral Account and all proceeds thereon, including Dividends |
Rehypothecation Rights |
Not applicable |
Voting of Shares |
Borrower may continue to exercise its voting rights in respect of the
Collateral Shares
The Collateral Agent shall promptly, and in a timely manner, execute
all proxies (or other mechanism as agreed between the Lenders and Borrower) for the purpose of enabling Borrower to exercise its voting
rights in respect of the Collateral Shares
|
Assignment/Hedging |
Any Lender can assign, sub-participate or hedge at any time without prior consent on terms customary for this type of financing; provided that any Lender assignment shall be subject to a list of disqualified potential lenders. |
Confidentiality |
Typical provisions for a transaction of this nature, including customary exceptions to permit the Lenders to assign, sub-participate or hedge |
Business Days |
New York |
Governing Law |
New York |
Documentation |
Margin Loan Agreement, Control Agreement, Security Agreement, Issuer Agreement, Guarantee |
Other Fees |
All taxes, duties, registration fees, legal fees, trustee or custodian fees, and enforcement costs (if any) incurred by the Lenders in relation to the Loan shall be reimbursed promptly by the Borrower when requested, subject to customary limitations, including that all legal fees shall be reasonable and documented, and the Lenders and the Administrative Agent shall only be entitled to the reimbursement of the reasonable and documented fees of one primary firm of counsel |
Conditions Precedent to Funding |
As set forth on Exhibit B to the Commitment Letter.
§
|
Issuer Agreement |
Issuer to represent to the Lenders and the Administrative Agent that,
among other things, the entry into the margin loan transaction and the pledge of the Collateral Shares will not violate the Issuer trading
and corporate policies, constitutional documents or bylaws.
The Issuer to covenant to the Lenders that the Issuer will not change
its Board pledging policy applicable to directors and executive officers with respect to pledged Shares prior to the Maturity Date.
|
Borrower Organization Documents |
Typical for a transaction of such nature; to include the following
concepts that will apply for so long as any Loan Amount remains outstanding:
§
the Borrower will appoint an independent director reasonably satisfactory to the Lenders
§
any bankruptcy, insolvency, winding up, liquidation, reorganization or similar proceedings or events with respect to the Borrower will
require an affirmative vote of the independent director
§
customary limited purpose provisions
§
customary separateness provisions
§
other provisions related to the foregoing for the continued ownership, existence and governance of the Borrower and otherwise to effectuate
such provisions
§
prohibitions on certain amendments of the Organizational Documents without Administrative Agent consent (not to be unreasonably withheld
or delayed)
|
Representations & Warranties |
Representations and Warranties customary to this type of financings (to be determined in the documentation), including, but not limited to the following (and subject to customary exceptions and qualifications to be agreed): organization, existence, and power; qualification; authorization and enforceability; non-conflict with other obligations; validity and admissibility in evidence; governing law and enforcement; deduction of tax; no filing or stamp taxes; no default; no material misleading information (with respect to any factual information provided); governmental consents; no material adverse change; compliance with laws including compliance with PATRIOT Act, Beneficial Ownership Regulation, OFAC, ERISA, margin regulations, Foreign Corrupt Practices Act and laws with respect to sanctioned persons and any applicable anti-corruption laws; compliance with corporate policies of the Issuer; inapplicability of the Investment Company Act; Funding Date solvency; status of the Borrower as a special purpose entity; no proceedings pending or threatened; no overdue tax filings, no tax claims or investigations and all due taxes paid; security valid and perfected; no MNPI with respect to Issuer or the Shares; and good title to the Shares
|
Information Covenants |
Including, but not limited to the following (and subject to customary exceptions and qualifications to be agreed): unaudited annual balance sheet and unaudited statement of profit and loss of the Borrower; notices of any material events; no provision of material non-public information concerning the Issuer; compliance with Exchange Act requirements; notification of default; semi-annual certificates from the Borrower with respect to no continuing Event of Default and compliance with the Prohibition on Other Financings provision; all reasonable KYC due diligence requirements; and provision of information, documentation and consents required to facilitate hedging transactions and foreclosure upon enforcement
|
Other Covenants |
Including, but not limited to the following (and subject to customary exceptions and qualifications to be agreed): maintenance of procedures to ensure compliance with FCPA and any applicable anti-corruption laws, OFAC and other laws with respect to sanctions; maintenance of books and records; maintenance of existence; authorizations; compliance with applicable laws and regulations (including ERISA); compliance with corporate policies of the Issuer; payment of obligations and taxes; compliance with constituent documents and observance of special purpose provisions; maintenance of at least one independent director; further assurances on Collateral matters; no merger; no change of business; taxation; no financial indebtedness nor liens on its property (with customary permitted liens); prohibition on other financings (as described below); arm’s length transactions; no impairment of security; maintenance of books and records; maintenance of existence; limitation on material amendments to constituent documents; limitation on creation of subsidiaries; limitation on making restricted payments; limitation on the making or holding of investments (other than Collateral); prohibition on the use of proceeds in violation of any anti-corruption or sanctions laws; prohibition on acting as an investment company; prohibition on violation of margin regulations; prohibition on changing tax status; prohibitions on contributions to employee benefit plans
|
Prohibition on Other Financings |
The Borrower shall not, and the Borrower
shall procure that each of its affiliates (other than the Issuer or any of its subsidiaries) shall not, directly or indirectly, grant,
or suffer to exist, any lien on any Shares that do not constitute Collateral Shares to secure any obligation of the Borrower or any of
its affiliates, other than any such liens that were granted by affiliates of the Borrower prior to the Countersign Effective Date (as
defined below) and the re-financing of such obligations secured by such liens in an amount not to exceed the amount so refinanced (plus
premiums, accrued interest, fees and expenses) (each, a “Permitted Refinancing”); provided that any liens on Shares not constituting
Collateral Shares securing obligations of affiliates of the Borrower incurred on or after the Countersign Effective Date and prior to
the Funding Date (other than a Permitted Refinancing) that do not in the aggregate of all such obligations exceed $150 million in principal
amount shall be excluded from the foregoing restriction.
|
LENDER COMMITMENTS |
Commitment Letter |
Each Lender will execute
the commitment letter to which this Summary of Principal Terms and Conditions is attached (the “Commitment Letter”) confirming
the total principal amount of its respective commitment to fund the margin loan on the Funding Date, subject to satisfaction of the conditions
precedent set forth on Exhibit B to the Commitment Letter. Each Lender’s funding commitment will be effective as of the Lender
Effective Date.
Commencing on
the Lender Effective Date, the Lenders’ commitments will remain available during the Commitment Effective Period. No upfront
availability fee will be paid to the Lenders at the time the Lenders sign the Commitment Letter or during the Commitment Effective Period.
If the Borrower has not countersigned the Commitment Letter before Countersign Expiration Time, each Lender’s respective commitment
will expire. If the Borrower countersigns the Commitment Letter during the Commitment Effective Period, the Borrower’s obligations
to pay the fees contemplated thereunder to be paid on the Countersign Effective Date will become effective.
|
Countersign Effective Date |
The date upon which the Borrower signs the Commitment Letter |
Commitment Effective Period |
The two-week period commencing on the Lender Effective Date and, unless the Borrower signs the Commitment Letter prior to the Countersign Expiration Time, ending at the Countersign Expiration Time . |
EXHIBIT B
Project X
Supplemental Conditions
Except as otherwise set forth
below, the availability and initial funding on the Funding Date of the Facility shall be subject to the satisfaction (or waiver by the
Commitment Parties) of the following conditions:
1. If
the Acquisition is accomplished via a tender offer by the Principal (as such tender offer may be amended, supplemented or otherwise modified
from time to time, the “Tender Offer”) pursuant to the initial offer to purchase, to be dated on or about April 2022
(as such offer to purchase may be amended, supplemented or otherwise modified from time to time, the “Initial Offer to Purchase”
(it being acknowledged that the draft of the Initial Offer to Purchase received by counsel to the Joint Bookrunners on April 20,
2022 at 5:34 p.m. (New York time) is reasonably acceptable to the Joint Bookrunners)), the Tender Offer shall have been immediately
prior to or, substantially concurrently with, the initial borrowing under the Facility, consummated in all material respects in accordance
with the terms of the Initial Offer to Purchase, without giving effect to any modifications, amendments or express waivers or consents
by you (or one of your affiliates) thereto that are materially adverse to the Initial Lenders in their capacities as such without the
written consent of the Joint Bookrunners (not to be unreasonably withheld, conditioned or delayed); provided that any modification,
amendment, waiver or consent by you (or one of your affiliates) with respect to the Poison Pill Condition (as defined in the Tender Offer
as of the date hereof), the Minimum Tender Condition (as defined in the Tender Offer as of the date hereof) or the Merger Agreement Condition
(as defined in the Tender Offer as in effect on the date hereof) shall be deemed materially adverse to the Initial Lenders in their capacities
as such without the express written consent of the Joint Bookrunners who (together with their respective affiliates) hold at least 66.67%
of the aggregate commitments in respect of the Facility. If the Acquisition is accomplished via an agreement and plan of merger (or similarly
styled agreement) to be entered into with the Target (the “Acquisition Agreement”) (i) the Acquisition
Agreement shall be reasonably acceptable to the Joint Bookrunners (it being understood that any such agreement shall be deemed to be
reasonable to the Joint Bookrunners if (x) the terms of the Acquisition set forth therein are generally consistent with the Initial
Offer to Purchase without material modifications that are materially adverse to the Initial Lenders and (y) contain customary “Xerox”
lender protection provisions) and (ii) the Acquisition shall have been immediately prior to or, substantially concurrently with
the initial borrowing under the Facility, consummated in all material respects in accordance with the terms of the Acquisition Agreement,
without giving effect to any modifications, amendments or express waivers or consents by you (or one of your affiliates) thereto that
are materially adverse to the Initial Lenders in their capacities as such without the consent of the Joint Bookrunners (not to be unreasonably
withheld, conditioned or delayed). It being understood that for purposes of the condition set forth in this paragraph 1, (x) any
increase in consideration payable with respect to the Acquisition shall not be materially adverse to the Initial Lenders so long as such
increase is not funded with additional indebtedness (other than amounts available to be drawn on the Funding Date from the Facility)
and (y) notwithstanding the proviso above any modification, amendment, waiver or consent by you (or one of your affiliates) with
respect to the Minimum Tender Condition shall not be deemed to be materially adverse to the Initial Lenders in their capacities as such
if you (or one of your affiliates) acquire at least ninety percent (90)% of the outstanding shares of the Issuer pursuant to the Tender
Offer and consummate the acquisition as a “short form” second-step merger pursuant to Section 253 of the DGCL as described
in the Initial Offer to Purchase.
2. The
Administrative Agent and the Initial Lenders shall have received, at least three business days prior to the Funding Date, (a) all
documentation and other information about the Borrower and the Guarantor as shall have been reasonably requested in writing by the Administrative
Agent or the Initial Lenders at least ten business days prior to the Funding Date and as required by applicable regulatory authorities
under applicable “know your customer” and anti-money laundering rules and regulations, including without limitation,
the PATRIOT Act and (b) if the Borrower qualifies as a “legal entity” customer under 31 C.F.R. § 1010.230 and the
Administrative Agent has provided the Borrower the name of each requesting Initial Lender and its electronic delivery requirements at
least ten business days prior to the Funding Date, the Administrative Agent and each such Initial Lender requesting a certification regarding
beneficial ownership as required by 31 C.F.R. §1010.230 (such certification, the “Beneficial Ownership Certification”)
(which request is made through the Administrative Agent) will have received, at least three business days prior to the Funding Date,
the Beneficial Ownership Certification in relation to the Borrower.
3. The
Administrative Agent and each Initial Lender shall have received each of the following documents, duly executed:
| a. | duly executed counterparts of the margin
loan agreement (the “Margin Loan Agreement”), dated as of its execution
date which may be the Funding Date or an earlier date and based on a mutually agreed-upon
market precedent with customary provisions for a syndicated margin loan in the U.S. market
and consistent with the Term Sheet; |
| b. | duly executed counterparts of the Facility
documentation, dated as of the Funding Date (except for the Margin Loan Agreement) and based
on a mutually agreed-upon market precedent with customary provisions for a syndicated margin
loan in the U.S. market and consistent with the Term Sheet; |
| c. | a customary certificate of the Borrower,
dated as of the Funding Date and executed by an authorized representative, which shall (i) certify
the resolutions authorizing the execution, delivery and performance of the Facility documentation
to which it is a party and the transaction to be consummated by it on the Funding Date and
(ii) contain appropriate attachments, including the organization documents and the engagement
letter for, or other reasonably satisfactory evidence of the engagement of, an independent
director for the Borrower, and (b) a long form good standing certificate for the Borrower
from its jurisdiction of organization; |
| d. | a solvency certificate of the Borrower
from an authorized representative thereof, dated as of the Funding Date and in the form of
Annex B-I attached hereto; |
| e. | a customary opinion of counsel to the
Borrower and the Guarantor, addressed to Administrative Agent and the Initial Lenders, dated
as of the Funding Date; |
| f. | the results of a recent lien and judgment
search in the jurisdiction of organization of the Borrower and a judgment search in the jurisdictions
of residence of the Guarantor, and each such search shall reveal no liens on any of the assets
of the Borrower except for certain permitted liens (to be defined in the Margin Loan Agreement),
or judgments against any of the Borrower or the Guarantor; |
| g. | proper financing statements (Form UCC-1
or the equivalent) of the Borrower for filing under the Uniform Commercial Code or other
appropriate filing offices of each jurisdiction as may be necessary to perfect the security
interests purported to be created by the security agreement (the “Security Agreement”);
and |
| h. | FRB Form U-1 or FRB Form G-3
duly executed by the Borrower to the extent required by any Initial Lender. |
4. On
or prior to the Funding Date, the collateral accounts for the Initial Lenders shall have been established by Borrower and Guarantor;
Borrower and Guarantor shall have executed and delivered all account opening documentation reasonably requested by the custodian for
the collateral accounts; the common stock of Tesla, Inc. to be pledged as collateral (the “Collateral Shares”)
shall have been credited to the collateral accounts on a pro rata basis and held through the facilities of DTC; such Collateral Shares
shall be free from all transfer restrictions (other than certain permitted transfer restrictions) and restrictive conditions (other than
certain permitted transfer restrictions); and all steps required to perfect the Initial Lenders’ security interest in the Collateral
Shares shall have been satisfied in all material respects.
5. All
fees required to be paid on the Funding Date pursuant to the Fee Letter or the Facility documentation and reasonable out-of-pocket expenses
required to be paid on the Funding Date pursuant to the Commitment Letter or the Facility Documentation, to the extent invoiced at least
three business days prior to the Funding Date (except as otherwise reasonably agreed by the Borrower), shall, upon the initial borrowings
under the Facility, have been, or will be substantially simultaneously, paid (which amounts may, at your option, be offset against the
proceeds of the Facility).
6. Each
of the Specified Representations (as defined below) shall be true and correct in all material respects (unless any such representation
or warranty is qualified as to materiality, in which case it shall be true and correct in all respects) on and as of the Funding Date,
except to the extent that such representations and warranties expressly relate to an earlier date, in which case they shall be true and
correct in all material respects as of such date (unless any such representation or warranty is qualified as to materiality, in which
case it shall be true and correct in all respects as of such date).
7. Borrower
shall have delivered to Administrative Agent a certificate from a responsible officer of Borrower in the form set forth in Annex B-2
hereto, dated as of the Funding Date, which shall contain representations that the conditions set forth in Conditions (4), (6), (9) and
(10) of this Exhibit B have been satisfied.
8. Borrower
shall have delivered to Administrative Agent a Borrowing Notice at least three business days prior to the Funding Date.
9. Immediately
after giving effect to the advances, the LTV Ratio (as such term is defined in the Term Sheet) shall not exceed 20%.
10. No
Collateral Shortfall (as such term is defined in the Term Sheet) shall have occurred that has not been cured or waived, and no Default,
Event of Default, Potential Adjustment Event, Mandatory Prepayment Event (in each case, as defined in the Term Sheet) shall have occurred
and be continuing, in each case on the Funding Date and none of the foregoing shall result from the funding of the Facility or the application
of the proceeds therefrom.
11. The
Funding Date shall have occurred no later than the end of the Availability Period.
For purposes of this Exhibit B,
“Specified Representations” means the representations and warranties made by the Borrower and the Guarantor
to be set forth in the Facility Documentation relating to the corporate or other organizational existence, power and authority, due authorization,
execution, delivery and enforceability, in each case related to the borrowing under, guaranteeing under, granting of security interests
in the Collateral Shares to, entry into and performance of, the Facility Documentation; the incurrence of the loans and the provision
of the guarantee to be provided by the Guarantor, in each case under the Facility, and the granting of the security interests in the
Collateral Shares to secure the Facility, not conflicting with the Borrower’s constitutional documents or conflicting with any
of the contracts, indentures, or other agreements of the Borrower or the Guarantor; solvency as of the Funding Date of each of the Borrower
and the Guarantor on a consolidated basis (solvency to be defined in a manner consistent with the manner in which solvency is defined
in the solvency certificate to be delivered pursuant to paragraph 3d of this Exhibit B); creation, validity and perfection of security
interests in the Collateral Shares to be perfected on the Funding Date (subject to permitted liens); Federal Reserve margin regulations;
the use of loan proceeds not violating OFAC or the FCPA, and other anti-terrorism, anti-bribery, anti-corruption and anti-money laundering
laws; the PATRIOT Act; and the Investment Company Act.
Form of Solvency Certificate
Date: _____
This Solvency Certificate
is delivered pursuant to Section [____] of the Margin Loan Agreement, dated as of [____], 2022 (as it may be amended, restated,
supplemented or otherwise modified, refinanced or replaced from time to time, the “Loan Agreement”), among
X Holdings III, LLC, a Delaware limited liability company (the “Borrower”), the lenders from time to time party
thereto (“Lenders”) and Morgan Stanley Senior Funding, Inc., as Administrative Agent and Calculation Agent.
Capitalized terms used herein and not otherwise defined herein shall have the meanings assigned to such terms in the Loan Agreement.
The undersigned hereby certifies,
solely in his capacity as Member of the Borrower, and not in his individual capacity (and without personal liability), as follows:
1. I
am the sole Member of X Holdings III, LLC. I am familiar with the Transactions, and have reviewed the Loan Agreement and such documents
and made such investigation as I have deemed relevant for the purposes of this Solvency Certificate.
2. As
of the date hereof, immediately after giving effect to the consummation of the Transactions, (i) the present fair market value of
the assets of the Borrower exceeds the total amount of the liabilities (including contingent liabilities) of the Borrower, (ii) the
Borrower has capital and assets sufficient to carry on its businesses, (iii) the Borrower is not engaged and is not about to engage
in a business or a transaction for which its remaining assets are unreasonably small in relation to such business or transaction and
(iv) the Borrower does not intend to incur or believe that it will incur debts beyond its ability to pay as they become due.
3. The
Borrower will not be rendered insolvent by the consummation of the Transactions.
This Solvency Certificate
is being delivered by the undersigned officer only in his capacity as the Member of the Borrower and not individually and the undersigned
shall have no personal liability to the Administrative Agent, the Calculation Agent or the Lenders with respect thereto.
[Remainder of page intentionally
left blank; signature page follows]
IN WITNESS WHEREOF, the undersigned
has executed this Solvency Certificate on the date first written above.
|
By: |
|
|
Name: |
Elon R. Musk |
|
Title: |
Member |
Form of Responsible Officer’s Certificate
Reference is made to the Margin Loan Agreement,
dated as of [____], 2022 (as it may be amended, restated, supplemented or otherwise modified, refinanced or replaced from time to time,
the “Loan Agreement”), among X Holdings III, LLC, a Delaware limited liability company (the “Borrower”),
the Lenders from time to time party thereto and Morgan Stanley Senior Funding, Inc., as Administrative Agent and Calculation Agent.
Terms used but not defined herein shall have the meanings given to such terms in the Loan Agreement.
This certificate is being furnished pursuant
to Section [____] of the Loan Agreement.
| (i) | The undersigned,
Elon R. Musk, Member of the Borrower, solely in his capacity as Member of the Borrower and
not individually, and in his individual capacity as guarantor to the Loan Agreement ( in
such capacity, “Guarantor”) hereby certifies, on [____], 2022, that, as
of the date hereof: |
| • | (i) the Collateral Accounts for
each Lender making Advances on the date hereof have been established by Borrower; (ii) Borrower
has executed and delivered all account opening or other documentation reasonably requested
by Custodian; (iii) [____] Shares constituting Acceptable Collateral have been credited
to the Collateral Accounts on a Pro Rata Basis; (iv) the Collateral Shares are free
from all Transfer Restrictions (other than Permitted Transfer Restrictions) and Restrictive
Conditions (other than Permitted Restrictive Conditions); and (v) the Collateral Requirement
has been satisfied in all material respects; |
| • | the Specified Representations contained
in the Margin Loan Documentation are true and correct in all material respects (unless any
such representation or warranty is qualified as to materiality, in which case it is true
and correct in all respects) on and as of the date hereof, except to the extent such representations
and warranties expressly relate to an earlier date, in which case such representations and
warranties are true and correct in all material respects on and as of such earlier date (unless
any such representation or warranty is qualified as to materiality, in which case it is true
and correct in all respects as of such date); |
| • | immediately after giving effect to
the Advances made on the date hereof, the LTV Ratio does not exceed the Maximum Initial LTV
Level; and |
| • | (i) no Collateral Shortfall has
occurred that has not been cured or waived as of the date hereof, (ii) no Default, Event
of Default or Adjustment Determination Period has occurred and is continuing, in each case,
on the date hereof and (iii) no event described in the foregoing clauses (i) and
(ii) will result from the Advances made on the date hereof or the application of the
proceeds therefrom. |
[Remainder of page intentionally left blank]
IN WITNESS WHEREOF, the undersigned
has executed this Certificate on the date first written above.
|
By: |
|
|
Name: |
Elon R. Musk |
|
Title: |
Member |
EXHIBIT 99.J
EXHIBIT J
EXECUTION COPY
STRICTLY CONFIDENTIAL
April 25, 2022
X Holdings I, Inc.
2110 Ranch Road
620 S. #341886,
Austin, TX 78734
Re: Equity Financing Commitment
Ladies and Gentlemen:
Reference is made to the Agreement
and Plan of Merger, dated as of the date hereof (as amended, restated, supplemented or modified from time to time, the “Merger Agreement”),
by and among Twitter, Inc., a Delaware corporation (the “Company”), X Holdings II, Inc., a Delaware corporation (“Acquisition
Sub”), X Holdings I, Inc., a Delaware corporation (“Parent”), and, solely for purposes of specified provisions set forth
therein, Elon R. Musk. Each term used and not otherwise defined herein shall have the meaning assigned to such term in Merger Agreement.
This letter agreement is being
delivered by Elon Musk (including his assigns, the “Equity Investor”) to Parent in connection with the Merger Agreement.
1. Aggregate
Equity Commitment. This letter agreement confirms the commitment of the Equity Investor, subject to the conditions set forth
herein, to, directly or indirectly, contribute to or otherwise provide equity capital to Parent at or immediately prior to the
Closing (or cause an assignee to do the same) in an aggregate amount equal to $21,000,000,000 (such commitment, the “Aggregate
Equity Commitment”), or such lesser amount as is necessary to fully discharge, when taken together with the aggregate proceeds
of the Debt Financing (or, if applicable, Alternative Financing) actually funded at Closing, the amounts required to be funded by
Parent in connection with the Merger Agreement, including (a) the aggregate payments required pursuant to Section 3.2 of the Merger
Agreement (the “Merger Price Amount”), and (b) the aggregate amount required to fund the payment of any and all other
amounts, costs, fees and expenses required to be paid by Parent in connection with the transactions pursuant to and in accordance
with the Merger Agreement (the “Transaction Cost Amount”). Notwithstanding anything else to the contrary in this letter
agreement, the Equity Investor (together with his assigns) shall not have any obligation under any circumstances to contribute to,
or otherwise provide to, Parent, directly or indirectly, funds in an amount in excess of the Aggregate Equity Commitment or be
required both (x) to fund the Aggregate Equity Commitment and (y) following termination of the Merger Agreement, make any payment of
any kind pursuant to or as a result of the Limited Guarantee. The Aggregate Equity Commitment shall be funded in United States
Dollars in immediately available funds. The obligation of the Equity Investor (together with his assigns) to fund the Aggregate
Equity Commitment is subject to (i) the terms of this letter agreement, (ii) the conditions to Parent’s obligation to
consummate the transactions contemplated by the Merger Agreement set forth in Section 7.1 and Section 7.2 of the Merger Agreement
being satisfied or waived (other than those conditions that by their nature are to be satisfied by the taking of actions or delivery
of documents at the Closing, but subject to the prior or substantially contemporaneous satisfaction or waiver of such conditions at
the Closing) and (iii) substantially contemporaneous receipt by Parent or Acquisition Sub of the cash proceeds of the Debt Financing
contemplated by the Debt Commitment Letters in accordance with the terms and conditions of such Debt Commitment Letters or any
Alternative Financing that Parent accepts from alternative sources pursuant to Section 6.10(c) of the Merger Agreement (subject only
to the funding of the Aggregate Equity Commitment contemplated by this letter agreement). The Aggregate Equity Commitment may be
reduced by (x) any other equity contributions made to Parent (or any of its direct or indirect parent entities) for such purpose
and/or (y) any additional Debt Financing (or Alternative Financing) obtained by Parent or Acquisition Sub, in each case, on or after
the date hereof and prior to or at the Closing; provided, that any such reduction will occur concurrently with, and will be
conditioned on the consummation of, the Closing. The Aggregate Equity Commitment (or any amounts contributed or funded as
contemplated pursuant to the prior sentence) shall be used solely as will be required, and solely to the extent necessary, to fund
the Merger Price Amount or the Transaction Cost Amount, solely to the extent and when required to be paid on the terms and subject
to the conditions set forth herein and in the Merger Agreement and not for any other purpose whatsoever.
2.
Termination. The Equity Investor’s obligation to fund the Aggregate Equity Commitment will terminate automatically
and immediately upon the earliest to occur of (a) the institution or assertion of any action, suit, claim, arbitration or other proceeding,
whether at law, in equity or otherwise (a “Claim”), by the Company or its controlled Affiliates against any of the
Equity Investor or any Related Party (as defined below) arising under, or in connection with, this letter agreement,
the Limited Guarantee, the Merger Agreement, or any the transactions contemplated hereby or thereby (a “Prohibited Claim”),
other than a Claim by the Company (i) against the Equity Investor, Acquisition Sub and/or Parent in accordance with, and solely to the
extent permitted under, the Merger Agreement, seeking (A) specific performance or other equitable remedies against the Equity Investor,
Acquisition Sub and Parent or (B) payment of the Parent Termination Fee and (ii) against the Equity Investor in accordance with, and solely
to the extent permitted under, the Limited Guarantee or this letter agreement (the foregoing clause (i) and (ii), the “Non-Prohibited
Claims”), (b) the valid termination of the Merger Agreement pursuant to Section 8.1 thereof (unless the Company shall have previously
commenced an action, suit or proceeding pursuant to Section 9.9 of the Merger Agreement or Section 5 of this letter agreement, in which
case the obligations set forth in Section 1 of this letter agreement shall terminate upon the final, non-appealable resolution of such
action, suit or proceeding by a court of competent jurisdiction and the satisfaction by the Equity Investor of any obligations finally
determined (if any) or agreed to be owed by the Equity Investor, consistent with the terms hereof), or (c) the Closing (if the Closing
occurs) (but only if the obligation to fund the Aggregate Equity Commitment pursuant to Section 1 of this letter agreement and the obligation
to fund the Merger Price Amount and the Transaction Cost Amount in accordance with the terms and subject to the conditions set forth in
the Merger Agreement shall have been discharged in connection therewith). Upon the termination or expiration of this letter agreement,
no party hereto shall have any further obligations or liabilities hereunder.
| 3. | Representations and Warranties. The Equity Investor hereby
represents and warrants that: |
(a)
he has all necessary power and authority to execute, deliver and perform this letter agreement;
(b)
the execution, delivery and performance of this letter agreement by the Equity Investor does not and will not (i) violate any rule
of Law or (ii) result in any violation of, or default (with or without notice or lapse of time, or both) under, or give rise to a right
of termination, cancellation or acceleration of any obligation or to the loss of any benefit under any material contract binding on the
Equity Investor’s assets to which he is a party;
(c)
except for the Consents, registrations, declarations, filings and notices referred to in Section 4.4(b) of the Merger Agreement,
all consents, approvals, authorizations, permits of, filings with and notifications to, any Governmental Authority necessary for the due
execution, delivery and performance of this letter agreement by the Equity Investor have been obtained or made and all conditions thereof
have been duly complied with, and no other action by, and no notice to or filing with, any Governmental Authority is required in connection
with the execution, delivery or performance of this letter agreement;
(d)
this letter agreement constitutes a legal, valid and binding obligation of the Equity Investor enforceable against the Equity Investor
in accordance with its terms, except (i) as may be limited by any bankruptcy, insolvency, reorganization, moratorium and similar legal
requirements affecting or relating to the enforcement of creditors’ rights generally and (ii) is subject to general principles of
equity, whether considered in a proceeding at law, in equity, in contract, in tort or otherwise; and
(e)
he has the financial capacity to pay and perform his obligations under this letter agreement for so long as this letter agreement
shall remain in effect in accordance with Section 2 hereof.
4.
Assignment; Reliance. The Equity Investor may assign all or a portion of his obligations to fund the Aggregate Equity Commitment
to any Person and, upon any such assignment and acceptance thereof, the applicable assignee shall become committed to make payment of
the assigned percentage of the Aggregate Equity Commitment, agree to, and be bound by, the other provisions set forth herein with respect
to the assigned portion of the Aggregate Equity Commitment and make the representations and warranties in Section 3 hereof with respect
to the assigned portion of the Aggregate Equity Commitment; provided, that any assignment to any Person that may reasonably be expected
to (a) result in any additional Consent or approval being required under any Antitrust Laws or Foreign Investment Laws or (b) materially
impair or delay (i) the obtaining of any Consent or approval required under any Antitrust Laws or Foreign Investment Laws or (ii) funding
of the Aggregate Equity Commitment or the Closing, shall, in each case, require the prior written consent of the Company; provided,
further, however that any such assignment shall not relieve the Equity Investor of his obligations hereunder unless and to the
extent actually performed and funded at the Closing. Parent may not assign any of its rights or obligations set forth herein without
the prior written consent of the Equity Investor.
(a)
Notwithstanding anything that may be expressed or implied in this letter agreement, Parent and the Company, by their acceptance
of the benefits of the Aggregate Equity Commitment provided herein, covenant, acknowledge and agree that no party other than the Equity
Investor (or his assigns) shall have any obligation hereunder and that, (a) no recourse (whether at law, in equity, in contract, in tort
or otherwise) hereunder or under any documents or instruments delivered in connection herewith, or in respect of any oral representations
made or alleged to be made in connection herewith or therewith, shall be had against any former, current or future direct or indirect
director, officer, employee, agent, partner, manager, member, security holder, Affiliate, stockholder, controlling party, assignee or
representative of the undersigned, other than the parties hereto or their assignees (any such party, other than the parties hereto or
their assignees, or Parent or Acquisition Sub, a “Related Party” and together, the “Related Parties”), or any
Related Party of any Related Party of any party hereto (including, without limitation, in respect of any liabilities or obligations arising
under, or in connection with, this letter agreement or the transactions contemplated hereby (or in respect of any oral representations
made or alleged to be made in connection herewith or therewith) or with respect to any legal action (whether at law, in equity, in contract,
in tort or otherwise), including, without limitation, in the event Parent or Acquisition Sub breaches its obligations under the Merger
Agreement and including whether or not the breach by Parent or Acquisition Sub is caused by the breach by the Equity Investor of his
obligations under this letter agreement) whether by the enforcement of any judgment or assessment or by any legal or equitable proceeding,
or by virtue of any statute, regulation or other applicable law; and (b) no personal liability whatsoever will attach to, be imposed
on or otherwise incurred by any Related Party of any party hereto or any Related Party of any Related Party of any party hereto under
this letter agreement or any documents or instruments delivered in connection herewith (or in respect of any oral representations made
or alleged to be made in connection herewith or therewith) or for any legal action (whether at law, in equity, in contract, in tort or
otherwise) based on, in respect of, or by reason of such obligations hereunder or by their creation or any legal or equitable proceeding
(including, without limitation, alleging an alter ego theory or seeking to piece the corporate veil or otherwise); provided, that
the Related Parties are third party beneficiaries of this Section 5(a).
(b)
This letter agreement may only be enforced by Parent in its sole discretion or, solely to the extent set forth in the proviso to
the next sentence, the Company. The Company shall have no right to enforce this letter agreement except solely to the extent set forth
in the following proviso and no third party, including any of Parent’s creditors, shall have any right to enforce this letter agreement
or to cause Parent to enforce this letter agreement; provided, however, that, subject to the terms and conditions of the
Merger Agreement and this letter agreement, the Company is hereby made a third party beneficiary of the rights granted to Parent hereby
for the purpose of seeking specific performance of Parent’s right to cause the Aggregate Equity Commitment to be funded hereunder,
or to directly cause the Equity Investor to fund the Aggregate Equity Commitment hereunder, without any requirement that such enforcement
be at the direction of Parent, and for no other purpose (including, without limitation, any claim for monetary damages hereunder).
(c)
Concurrently with the execution and delivery of this letter agreement, the Equity Investor is executing and delivering to the Company
the Limited Guarantee relating to certain of Parent’s obligations under the Merger Agreement.
6.
Governing Law; Consent to Jurisdiction. This letter agreement and all actions, proceedings or counterclaims (whether based
on contract, tort or otherwise) arising out of or relating to this letter agreement, or the actions of the parties hereto in the negotiation,
administration, performance and enforcement thereof, shall be governed by, and construed in accordance with, the laws of the State of
Delaware, without giving effect to any choice or conflict of laws provision or rule (whether of the State of Delaware or any other jurisdiction)
that would cause the application of the Laws of any jurisdiction other than the State of Delaware. Each of the parties hereto hereby (i)
expressly and irrevocably submits to the exclusive personal jurisdiction of the Delaware Court of Chancery, any other court of the State
of Delaware or any federal court sitting in the State of Delaware in the event any dispute arises out of this letter agreement or the
transactions contemplated by this letter agreement, (ii) agrees that it will not attempt to deny or defeat such personal jurisdiction
by motion or other request for leave from any such court, (iii) agrees that it will not bring any action relating to this letter agreement
or the transactions contemplated by this letter agreement in any court other than the Delaware Court of Chancery, any other court of the
State of Delaware or any federal court sitting in the State of Delaware, (iv) waives, to the fullest extent it may legally and effectively
do so, any objection which it may now or hereafter have to the laying of venue of any suit, action or proceeding arising out of or relating
to this letter agreement and (v) agrees that each of the other parties shall have the right to bring any action or proceeding for enforcement
of a judgment entered by the state courts of the Delaware Court of Chancery, any other court of the State of Delaware or any federal court
sitting in the State of Delaware. Each party hereto agrees that a final judgment in any action or proceeding shall be conclusive and may
be enforced in other jurisdictions by suit on the judgment or in any other manner provided by Law. Each party hereto irrevocably consents
to the service of process outside the territorial jurisdiction of the courts referred to in this Section 6 in any such action or proceeding
by mailing copies thereof by registered or certified U.S. mail, postage prepaid, return receipt requested, to its address as specified
in or pursuant to Section 8. However, the foregoing shall not limit the right of a party to effect service of process on the other party
by any other legally available method.
7.
Entire Agreement; Amendments and Waivers. This letter agreement, the Limited Guarantee and the Merger Agreement (including
the Exhibits and Schedules thereto) constitutes the entire agreement, and supersedes all other prior agreements and understandings, both
written and oral, among the parties, or any of them, with respect to the subject matter hereof. This letter agreement may only be amended,
restated, supplemented or otherwise modified or waived by a written instrument signed by each of the parties hereto and the Company (it
being agreed that the Company is an intended third party beneficiary of this sentence). No action taken pursuant to this letter agreement,
including any investigation by or on behalf of any party, shall be deemed to constitute a waiver by the party taking such action of compliance
with any representation, warranty, covenant or obligation contained herein. No failure or delay by any party in exercising any right hereunder
shall operate as a waiver thereof nor shall any single or partial exercise thereof preclude any other or further exercise of any other
right hereunder. Any agreement on the part of a party hereto to any such extension or waiver shall be valid only if set forth in an instrument
in writing signed on behalf of such party.
8. Notices.
All notices, consents and other communications hereunder shall be in writing and shall be given (and shall be deemed to have been
duly given upon receipt) by hand delivery, by prepaid overnight courier (providing written proof of delivery) or by confirmed
electronic mail, addressed as follows:
(a)
If to Parent, to:
2110 Ranch Road
620 S. #341886,
Austin, TX 78734
Attention: Elon Musk
with copies (which shall not constitute notice) to:
Skadden, Arps, Slate, Meagher & Flom LLP
525 University Ave, Suite 1400
Palo Alto, California 94301
| Email: | mike.ringler@skadden.com |
sonia.nijjar@skadden.com
dohyun.kim@skadden.com
Sonia K. Nijjar
Dohyun Kim
(b)
If to the Equity Investor, to:
2110 Ranch Road
620 S. #341886,
Austin, TX 78734
Attention: Elon Musk
with copies (which shall not constitute actual or constructive
notice) to:
Skadden, Arps, Slate, Meagher & Flom LLP
525 University Ave, Suite 1400
Palo Alto, California 94301
| Email: | mike.ringler@skadden.com |
sonia.nijjar@skadden.com
dohyun.kim@skadden.com
Sonia K. Nijjar
Dohyun Kim
9. Severability.
If any term, provision, covenant or restriction of this letter agreement is held by a court of competent jurisdiction or other
authority to be invalid, void, illegal, unenforceable or against its regulatory policy, the remainder of the terms, provisions,
covenants and restrictions of this letter agreement shall remain in full force and effect and shall in no way be affected, impaired
or invalidated. Upon such determination that any term or other provision is invalid, void, illegal, unenforceable or against its
regulatory policy, the parties hereto shall negotiate in good faith to modify this letter agreement so as to effect the original
intent of the parties hereto as closely as possible in a mutually acceptable manner in order that the transactions contemplated by
this letter agreement be consummated as originally contemplated to the fullest extent possible.
10.
Counterparts; Delivery by Email. This letter agreement may be executed in multiple counterparts, all of which shall together
be considered one and the same agreement. Delivery of an executed signature page to this letter agreement by electronic transmission shall
be as effective as delivery of a manually signed counterpart of this letter agreement.
11.
WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY IRREVOCABLY WAIVES ALL RIGHT TO TRIAL BY JURY IN ANY ACTION, PROCEEDING OR
COUNTERCLAIM (WHETHER BASED ON CONTRACT, TORT OR OTHERWISE) ARISING OUT OF OR RELATING TO THIS LETTER AGREEMENT OR THE ACTIONS OF THE
PARTIES HERETO IN THE NEGOTIATION, ADMINISTRATION, PERFORMANCE AND ENFORCEMENT THEREOF.
[The remainder of this page is intentionally
left blank]
|
Very truly yours. |
|
|
|
ELON R. MUSK |
|
|
|
/s/ Elon R. Musk |
Accepted and acknowledged:
PARENT:
X HOLDINGS I, INC. |
|
By: |
/s/ Elon R. Musk |
Name: |
Elon R. Musk |
Title: |
President, Secretary and Treasurer |
[Signature Page to Equity Commitment Letter]
|