CREDIT AGREEMENT
This CREDIT AGREEMENT (as amended, restated, amended and restated or otherwise modified from time to time, this “Agreement”) is entered into as of December 10, 2019, among HOVNANIAN ENTERPRISES, INC., a Delaware corporation (“Holdings”), K. HOVNANIAN ENTERPRISES, INC., a California corporation (the “Borrower”), the Subsidiaries of Holdings from time to time party hereto (each a “Subsidiary Guarantor” and collectively, together with Holdings, the “Guarantors”), each lender from time to time party hereto (collectively, the “Lenders” and individually, each a “Lender”) and WILMINGTON TRUST, NATIONAL ASSOCIATION, as Administrative Agent (as defined herein).
PRELIMINARY STATEMENTS
TheOn the Closing Date, the Borrower has requested that the Initial Term Lenders make Initial Term Loans to the Borrower in an aggregate principal amount of $81,498,000.
On the Amendment No. 1 Effective Date, Holdings, the Borrower and the Subsidiary Guarantors entered into the Amendment No. 1 Exchange Agreements pursuant to which, among other things, the Borrower exchanged the Exchanged Debt (as defined in the Amendment No. 1 Exchange Agreements) on the terms and conditions set forth in the Amendment No. 1 Exchange Agreements, including for Amendment No. 1 Term Loans.
The Guarantors have agreed to guarantee the Loan Obligations of the Borrower hereunder pursuant to the Guarantee.
The Lenders have agreed to provide the Loans on the terms and subject to the conditions set forth in this Agreement and the other Loan Documents.
In consideration of the mutual covenants and agreements contained in this Agreement, and for other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties hereto covenant and agree as follows:
Article I
DEFINITIONS AND ACCOUNTING TERMS
Section 1.01 Defined Terms. As used in this Agreement, the following terms shall have the meanings set forth below:
“1.125 Lien Indenture” means the Indenture, dated as of October 31, 2019 (as amended, supplemented, amended and restated or otherwise modified from time to time), among the Borrower, Holdings, each of the other guarantors party thereto andCollateral Agent” means Wilmington Trust, National Association, as trustee and collateral agent until such time, if any, a successor replaces such party in accordance with the applicable provisions of the 1.125 Lien Notes Indenture and thereafter means the successor serving thereunder.
“1.125 Lien Fixed Debt Cap” has the meaning assigned to such term in the definition of “Permitted Indebtedness”.
“1.125 Lien Guarantees” means the guarantee of the 1.125 Lien Notes by each guarantor under the 1.125 Lien Notes Indenture.
“1.125 Lien Notes” means the 7.75Borrower’s 8.0% Senior Secured 1.125 Lien Notes due 2026,2028 issued by the Borrower underpursuant to the 1.125 Lien Notes Indenture.
“1.251.125 Lien Notes Indenture” means the Indenture, dated as of October 315, 2019 (2023, as amended, supplemented, amended and restated or otherwise modified from time to time), among the Borrower, Holdings, each of the otherthe guarantors party thereto and Wilmington Trust, National Association, asthe 1.125 Lien tTrustee and the 1.125 Lien cCollateral aAgent.
“1.25 Lien Guarantees” means the guarantee of the 1.25 Lien Notes by each guarantor under the 1.25 Lien Indenture.
“1.125 Lien Trustee” means Wilmington Trust, National Association until such time, if any, a successor replaces such party in accordance with the applicable provisions of the 1.125 Lien Notes Indenture and thereafter means the successor serving thereunder
“1.25 Lien Notes” means the 10.5% Senior Secured 1.25 Lien Notes due 2026, issued by the Borrower underCollateral Agent” means Wilmington Trust, National Association until such time, if any, a successor replaces such party in accordance with the applicable provisions of the 1.25 Lien Notes Indenture and thereafter means the successor serving thereunder.
“1.5 Lien Indenture” means the Indenture, dated as of October 31, 2019 (as amended, supplemented, amended and restated or otherwise modified from time to time), among the Borrower, Holdings, each of the other guarantors party thereto and Wilmington Trust, National Association, as trustee and collateral agent.
“1.25 Lien Fixed Debt Cap” has the meaning assigned to such term in the definition of “Permitted Indebtedness”.
“1.51.25 Lien Guarantees” means the guarantee of the 1.51.25 Lien Notes by each guarantor under the 1.51.25 Lien Notes Indenture.
“1.51.25 Lien Notes” means the 11.25Borrower’s 11.75% Senior Secured 1.51.25 Lien Notes due 2026,2029 issued bypursuant to the Borrower under the 1.51.25 Lien Notes Indenture.
“1.5 Lien Obligations” means (a) the Obligations under the 1.5 Lien Notes and (b) all other Indebtedness of Holdings, the Borrower or any Restricted Subsidiary secured by Liens on the Collateral that are equal in priority to the Liens on the Collateral securing the 1.5 Lien Notes and guarantees thereof on a 1.5-lien basis, including all Obligations in respect thereof.
“1.751.25 Lien Notes Indenture” means the Indenture, dated as of the Closing Date (October 5, 2023, as amended, supplemented, amended and restated or otherwise modified from time to time), among the Borrower, Holdings, each of the otherthe guarantors party thereto and Wilmington Trust, National Association, asthe 1.25 Lien tTrustee and the 1.25 Lien cCollateral aAgent.
“1.25 Lien Trustee” means Wilmington Trust, National Association until such time, if any, a successor replaces such party in accordance with the applicable provisions of the 1.25 Lien Notes Indenture and thereafter means the successor serving thereunder.
“1.75 Lien Guarantees” means the guarantee of the 1.75 Lien Notes by each guarantor under the 1.75 Lien Indenture.
“1.75 Lien Notes” means the 10.00% Senior Secured 1.75 Lien Notes due 2025, issued by the Borrower under the 1.75 Lien Indenture.
“1.75 Lien Obligations” means (a) the Obligations under the 1.75 Lien Notes and (b) the Loan Obligations under this Agreement and the other Loan Documents.Fixed Debt Cap” has the meaning assigned to such term in the definition of “Permitted Indebtedness”.
“1.75 Pari Passu Lien Collateral Agent” means Wilmington Trust, National Association, in its capacity as 1.75 Pari Passu Lien Collateral Agent as appointed under the Security Agreement.
“13.5% Notes Exchange Agreement” means the 13.5% Notes Exchange Agreement, dated on or about the Amendment No. 1 Effective Date, among the Borrower, Holdings, the other guarantors party thereto and the other parties named therein, relating to the Amendment No. 1 Exchange.
“2023 8-K” has the meaning assigned to such term in the definition of “Side Letter”.
“5% Notes Exchange Agreement” means the 5% Notes Exchange Agreement, dated on or about the Amendment No. 1 Effective Date, among the Borrower, Holdings, the other guarantors party thereto and the other parties named therein, relating to the Amendment No. 1 Exchange.
“Acceptable Commitment” has the meaning specified in Section 2.03(a)(vi).
“Acquired Indebtedness” means (a) with respect to any Person that becomes a Restricted Subsidiary (or is merged into Holdings, the Borrower or any Restricted Subsidiary) after the Closing Date, Indebtedness of such Person or any of its Subsidiaries existing at the time such Person becomes a Restricted Subsidiary (or is merged into Holdings, the Borrower or any Restricted Subsidiary) that was not incurred in connection with, or in contemplation of, such Person becoming a Restricted Subsidiary (or being merged into Holdings, the Borrower or any Restricted Subsidiary) and (b) with respect to Holdings, the Borrower or any Restricted Subsidiary, any Indebtedness expressly assumed by Holdings, the Borrower or any Restricted Subsidiary in connection with the acquisition of any assets from another Person (other than Holdings, the Borrower or any Restricted Subsidiary), which Indebtedness was not incurred by such other Person in connection with or in contemplation of such acquisition. Indebtedness incurred in connection with or in contemplation of any transaction described in clause (a) or (b) of the preceding sentence shall be deemed to have been incurred by Holdings or a Restricted Subsidiary, as the case may be, at the time such Person becomes a Restricted Subsidiary (or is merged into Holdings, the Borrower or any Restricted Subsidiary) in the case of clause (a) or at the time of the acquisition of such assets in the case of clause (b), but shall not be deemed Acquired Indebtedness.
“Administrative Agent” means (a) on the Closing dDate hereofand the Amendment No. 1 Effective Date, Wilmington Trust, National Association in its capacity as administrative agent or collateral agent, as the case may be, under any of the Loan Documents or (b) at any time after the Amendment No. 1 Effective dDate hereof, any permitted successor administrative agent or collateral agent, as the case may be, appointed in accordance with the terms hereof.
“Administrative Agent’s Office” means the Administrative Agent’s address and, as appropriate, account as set forth on Schedule 9.02, or such other address or account as the Administrative Agent may from time to time notify in writing to the Borrower and the Lenders.
“Administrative Questionnaire” means an Administrative Questionnaire substantially in the form of Exhibit D.
“Affected Financial Institution” means (a) any EEA Financial Institution or (b) any UK Financial Institution.
“Affiliate” means, when used with reference to a specified Person, any Person directly or indirectly controlling, or controlled by or under direct or indirect common control with, the Person specified.
“Affiliate Transaction” has the meaning specified in Section 6.10.
“Agent Fee Letter” means that certain letter, dated as of the Closing dDate hereof, by and among the Borrower and the Administrative Agent.
“Agent-Related Person” means the Administrative Agent, together with its Affiliates, and the officers, directors, employees, agents and attorneys-in-fact of such Persons and Affiliates.
“Agents” means, collectively, the Administrative Agent and the Supplemental Administrative Agents (if any).
“Aggregate Commitments” means the Term Commitments of all the Lenders.
“Aggregate Exposure” means, with respect to a Lender at any time, an amount equal to such Lender’s Total Outstandings at such time plus the amount of such Lender’s unfunded Term Commitment then in effect (if any).
“Aggregate Exposure Percentage” means, with respect to a Lender at any time, the ratio (expressed as a percentage) of such Lender’s (a) Aggregate Exposure at such time to (b) the sum of the Aggregate Exposures of all Lenders at such time.
“Agreement” has the meaning specified in the introductory paragraph.
“All-In Yield” means, as to any Indebtedness, the effective yield applicable thereto calculated by the Borrower in a manner consistent with generally accepted financial practices, taking into account (a) interest rate margins, (b) interest rate floors, (c) any amendment to the relevant interest rate margins and interest rate floors prior to the applicable date of determination and (d) original issue discount and upfront or similar fees (based on an assumed four-year average life to maturity or lesser remaining average life to maturity).
“Amendment No. 1” means the First Amendment to the Credit Agreement, dated as of May 21, 2024, by and among Holdings, the Borrower, the Subsidiary Guarantors, the Administrative Agent, and the Lenders party thereto.
“Amendment No. 1 Effective Date” means May 21, 2024.
“Amendment No. 1 Effective Date Transactions” means (1) the consummation of the Amendment No. 1 Exchange and (2) the entry into and effectiveness of Amendment No. 1 and any related documents or agreements and the incurrence of the Amendment No. 1 Term Loans.
“Amendment No. 1 Exchange” means the exchange by holders of Amendment No. 1 Exchanged Existing Debt for Amendment No. 1 Term Loans and, as applicable in respect of certain of the Amendment No. 1 Exchanged Existing Debt, cash, in each case, pursuant to the terms and conditions of Amendment No. 1 Exchange Agreements.
“Amendment No. 1 Exchange Agreements” means the 13.5% Notes Exchange Agreement, the 5% Notes Exchange Agreement and the Unsecured Term Loan Exchange Agreement.
“Amendment No. 1 Exchanged Existing Debt” means the “Exchanged Debt” under and as defined in the Amendment No. 1 Exchange Agreements.
“Amendment No. 1 Term Commitment” means, as to each Amendment No. 1 Term Lender, the outstanding principal amount of such Amendment No. 1 Exchanged Existing Debt exchanged for the principal amount of the Amendment No. 1 Term Loans, as set forth opposite such Amendment No. 1 Term Lender’s name on Schedule 2.01 set forth on Exhibit D to Amendment No. 1 under the caption “Amendment No. 1 Term Commitment”. The aggregate principal amount of the Amendment No. 1 Term Commitments as of the Amendment No. 1 Effective Date is $93,502,000.
“Amendment No. 1 Term Lenders” means each Lender making or holding an Amendment No. 1 Term Loan.
“Amendment No. 1 Term Loan” a Loan made pursuant to Section 2.01(b).
“Anti-Money Laundering Laws” has the meaning specified in Section 5.11(b).
“Applicable Debt” means all Indebtedness of Holdings, the Borrower or any other Loan Party (a) under Credit Facilities or (b) for borrowed money.
“Applicable Rate” means with respect to an Initial Term Loan, 10.0% per annum. ; provided, that, upon the occurrence of a Specified Condition Event, the Applicable Rate applicable to Initial Term Loans will be increased as determined by the following formula:
|
AR=
|
((TO – x) * 10.0%)
|
+
|
(x * 11.75%)
|
|
|
|
TO
|
|
where,
AR = as-adjusted Applicable Rate;
TO = Total Outstandings as of the applicable calculation date less the portion of the Required Prepayment Amount as of the applicable calculation date that is prepaid as required by Section 2.03(a)(iv); and
x = the portion of the Required Prepayment Amount as of the applicable calculation date that is not prepaid as required by Section 2.03(a)(iv).
Upon the occurrence of a Specified Condition Event, the Applicable Rate shall be (i) included in the Specified Condition Event Notice to be sent pursuant to Section 2.06 hereof and (ii) calculated by the party sending such notice.
“Appropriate Lender” means, at any time, with respect to Loans of any Class, the Lenders of such Class.
“Approved Fund” means any Fund that is administered, advised, sub-advised or managed by (a) a Lender, (b) an Affiliate of a Lender or (c) an entity or an Affiliate of an entity that administers, advises, sub-advises or manages a Lender.
“Asset Acquisition” means (a) an Investment by Holdings, the Borrower or any Restricted Subsidiary in any other Person if, as a result of such Investment, such Person shall become a Restricted Subsidiary or shall be consolidated or merged with or into Holdings, the Borrower or any Restricted Subsidiary or (b) the acquisition by Holdings, the Borrower or any Restricted Subsidiary of the assets of any Person, which constitute all or substantially all of the assets or of an operating unit or line of business of such Person or which is otherwise outside the ordinary course of business.
“Asset Disposition” means any sale, transfer, conveyance, lease or other disposition (including by way of merger, consolidation or sale and leaseback or sale of shares of Capital Stock in any Subsidiary) (each, a “transaction”) by Holdings, the Borrower or any Restricted Subsidiary to any Person of any Property having a Fair Market Value in any transaction or series of related transactions of at least $10.0 million; provided that such de minimis amount shall not apply to any Land Banking Transactions (and with respect to Land Banking Transactions, the proviso in clause (b) below shall apply). The term “Asset Disposition” shall not include:
(a) a transaction between Holdings, the Borrower and any Subsidiary Guarantor or a transaction between Subsidiary Guarantors,
(b) a transaction in the ordinary course of business, including, without limitation, sales (directly or indirectly), sales subject to repurchase options, dedications and other donations to governmental authorities, leases and sales and leasebacks of (i) homes, improved land and unimproved land and (ii) real estate (including related amenities and improvements) ; provided that in the case of any Land Banking Transaction involving sales of Collateral (other than Collateral acquired by Holdings, the Borrower or any Restricted Subsidiary within 180 days prior to the entering into of a definitive agreement for such Land Banking Transaction) (“Land Banking Collateral Sales”) this exception (b) to the definition of “Asset Disposition” shall only apply if (x) on a pro forma basis after giving effect to any such Land Banking Collateral Sales, the Collateral Ratio would not be less than 150% or (y) if the Collateral Ratio is not at least 150% after giving pro forma effect thereto, any Land Banking Collateral Sales do not in the aggregate exceed a GAAP book value for all such Collateral of (i) $50.0 million in the first fiscal quarter ending October 31, 2023 plus (ii) an additional $10.0 million during any fiscal quarter beginning with the fiscal quarter ended JulyJanuary 31, 20162024 (with any unused amounts in any fiscal quarter aggregating inclusive of the fiscal quarter ended July 31, 2016 being carried over to subsequent fiscal quarters subject to a maximum GAAP book value of $50.075.0 million in any fiscal quarter),
(c) a transaction involving the sale of Capital Stock of, or the disposition of assets in, an Unrestricted Subsidiary (other than a JV Holding Company or Permitted Joint Venture, except a sale or a disposition to a Restricted Subsidiary),
(d) any exchange or swap of assets of Holdings, the Borrower or any Restricted Subsidiary for assets (including Capital Stock of any Person that is or will be a Restricted Subsidiary following receipt thereof) that (i) are to be used by Holdings, the Borrower or any Restricted Subsidiary in the ordinary course of its Real Estate Business and (ii) have a Fair Market Value not less than the Fair Market Value of the assets exchanged or swapped (provided that (except as permitted by clause (c) under the definition of “Permitted Investment”) to the extent that the assets exchanged or swapped were Collateral, the assets received are pledged as Collateral under the Collateral Documents substantially simultaneously with such exchange or swap, with the Lien on such assets received being of the same priority with respect to Loans as the Lien on the assets disposed of),
(e) any sale, transfer, conveyance, lease or other disposition of assets and properties that is governed by Section 6.11 hereof,
(f) dispositions of mortgage loans and related assets and mortgage-backed securities in the ordinary course of a mortgage lending business,
(g) the creation of a Permitted Lien and dispositions in connection with Permitted Liens,
(h) any sale, transfer, conveyance, lease or other disposition that constitutes a Restricted Payment or Permitted Investment,
(i) sales, transfers and other dispositions of Investments in joint ventures to the extent required by, or made pursuant to, customary buy/sell arrangements between the joint venture parties set forth in joint venture arrangements and similar binding arrangements,
(j) the unwinding of any Hedging Obligations,
(k) foreclosures, condemnation, eminent domain or any similar action on assets,
(l) any financing transaction with respect to property built or acquired by Holdings or any Restricted Subsidiary after the Closing Date,
(m) any surrender or waiver of contractual rights or the settlement, release or surrender of contractual rights or other litigation claims in the ordinary course of business, and
(n) the issuance of directors’ qualifying shares and shares issued to foreign nationals or other third parties as required by applicable law.
“Assignment and Assumption” means an Assignment and Assumption substantially in the form of Exhibit C or in another form reasonably acceptable to the Administrative Agent.
“Attorney Costs” means and includes all reasonable and documented out-of-pocket fees, expenses and disbursements of any law firm or other external counsel.
“Attributable Debt” means, with respect to any Financing Lease Obligations, the capitalized amount thereof determined in accordance with GAAP.
“Authorization” has the meaning specified in Section 5.03.
“Bail-In Action” means the exercise of any Write-Down and Conversion Powers by the applicable Resolution Authority in respect of any liability of an Affected Financial Institution.
“Bail-In Legislation” means (a) with respect to any EEA Member Country implementing Article 55 of Directive 2014/59/EU of the European Parliament and of the Council of the European Union, the implementing law, regulation, rule or requirement for such EEA Member Country from time to time that is described in the EU Bail-In Legislation Schedule and (b) with respect to the United Kingdom, Part I of the United Kingdom Banking Act 2009 (as amended from time to time) and any other law, regulation or rule applicable in the United Kingdom relating to the resolution of unsound or failing banks, investment firms or other financial institutions or their affiliates (other than through liquidation, administration or other insolvency proceedings).
“Bankruptcy Law” means Title 11 of the United States Code, as amended, or any similar federal or state law for the relief of debtors.
“Board of Directors” means, when used with reference to the Borrower or Holdings, as the case may be, the board of directors or any duly authorized committee of that board or any director or directors and/or officer or officers to whom that board or committee shall have duly delegated its authority.
“Borrower” has the meaning specified in the introductory paragraph to this Agreement.
“Borrower’s Office” means the Borrower’s address and, as appropriate, account as set forth on Schedule 9.02, or such other address or account as the Borrower may from time to time notify in writing to the Administrative Agent and the Lenders
“Borrowing” means a borrowing of Refinancing Term Loans or, Extended Term Loans or Incremental Term Loans, as the context may require.
“Business Day” means any day other than a Saturday, Sunday or other day on which commercial banks are authorized to close under the Laws of, or are in fact closed in, the state where the Administrative Agent’s Office is located.
“Capital Stock” means, with respect to any Person, any and all shares, interests, participations or other equivalents (however designated) of or in such Person’s capital stock or other equity interests, and options, rights or warrants to purchase such capital stock or other equity interests, whether now outstanding or issued after the Closing Date, including all Disqualified Stock and Preferred Stock, but excluding any debt security that is convertible into, or exchangeable for, Capital Stock.
“Cash Equivalents” means:
(a) U.S. dollars, Canadian dollars, euros, pounds sterling, any national currency of any participating member state in the European Union or local currencies held from time to time in the ordinary course of business;
(b) securities issued or directly and fully guaranteed or insured by the U.S. government or any country that is a member state of the European Union or any agency or instrumentality thereof having maturities of one year or less from the date of acquisition;
(c) certificates of deposit, time deposits, eurodollar time deposits, overnight bank deposits or bankers’ acceptances with maturities of one year or less from the date of acquisition, in each case with any domestic commercial bank having capital and surplus in excess of $500.0 million;
(d) marketable general obligations issued by any state of the United States of America or any political subdivision of any such state or any public instrumentality thereof maturing within one year from the date of acquisition and, at the time of acquisition, having a credit rating of at least “A” or the equivalent thereof by S&P or Moody’s, or carrying an equivalent rating by a nationally recognized Rating Agency, if both of the two named Rating Agencies cease publishing ratings of investments;
(e) repurchase obligations for underlying securities of the types described in clauses (b), (c) and (d) of this definition entered into with any financial institution meeting the qualifications specified in clause (c) of this definition;
(f) commercial paper rated P-1, A-1 or the equivalent thereof by Moody’s or S&P, respectively, and in each case maturing within one year after the date of acquisition;
(g) investments with average maturities of one year or less from the date of acquisition in money market funds rated AAA- (or the equivalent thereof) or better by S&P or Aaa3 (or the equivalent thereof) or better by Moody’s; and
(h) investments in investment companies or money market funds substantially all of the assets of which consist of securities described in the foregoing clauses (a) through (g) of this definition.
Notwithstanding the foregoing, Cash Equivalents shall include amounts denominated in currencies other than those set forth in clause (a) above; provided that such amounts are converted into any currency listed in clause (a) as promptly as practicable and in any event within ten (10) Business Days following the receipt of such amounts.
“Cash Management Services” means any of the following to the extent not constituting a line of credit (other than an overnight overdraft facility that is not in default): ACH transactions, treasury and/or cash management services, including controlled disbursement services, overdraft facilities, foreign exchange facilities, deposit and other accounts and merchant services.
“Change of Control” means:
(a) any sale, lease or other transfer (in one transaction or a series of transactions) of all or substantially all of the consolidated assets of Holdings and its Restricted Subsidiaries to any Person (other than a Restricted Subsidiary); provided, however, that a transaction where the holders of all classes of Common Equity of Holdings immediately prior to such transaction own, directly or indirectly, more than 50% of all classes of Common Equity of such Person immediately after such transaction shall not be a Change of Control;
(b) a “person” or “group” (within the meaning of Section 13(d) of the Exchange Act (other than (x) Holdings or (y) the Permitted Hovnanian Holders)) becomes the “beneficial owner” (as defined in Rule 13d-3 under the Exchange Act) of Common Equity of Holdings representing more than 50% of the voting power of the Common Equity of Holdings; or
(c) the stockholders of Holdings approve any plan or proposal for the liquidation or dissolution of Holdings; provided, however, that a liquidation or dissolution of Holdings which is part of a transaction that does not constitute a Change of Control under the proviso contained in clause (a) of this definition shall not constitute a Change of Control.
“Change of Control Offer” has the meaning specified in Section 6.16.
“Change of Control Repurchase Date” has the meaning specified in Section 6.16.
“Class” (a) when used with respect to Lenders, refers to whether such Lenders are Initial Term Lenders, Refinancing Term Lenders or, Extending Term Lenders or Incremental Lenders with loans or commitments hereunder with identical terms, (b) when used with respect to Term Commitments, refers to whether such Term Commitments are Initial Term Commitments or Term Commitments in respect of Refinancing Term Loans with identical terms and (c) when used with respect to Loans or a Borrowing, refers to whether such Loans, or the Loans comprising such Borrowing, are Initial Term Loans, Refinancing Term Loans or, Extended Term Loans or Incremental Term Loans with identical terms, in the case of each of clauses (a), (b) and (c), under this Agreement as originally in effect or as amended or otherwise modified pursuant to Section 2.13, Section 2.14, Section 2.16 or Section 9.01, of which such Loan, Borrowing or Term Commitment shall be a part.
“Closing Date” means the date on which the conditions precedent in Section 4.02 are satisfied or waived in accordance with Section 4.02, which date is December 10, 2019.
“Closing Date Exchange” means the exchange by holders of Closing Date Exchanged Existing Debt for the Initial Term Loans and cash pursuant to the Closing Date Exchange Agreement.
“Closing Date Exchange Agreement” means that certain Exchange Agreement, dated on or about the Closing Date, among the Borrower, Holding, other guarantors named therein, the other parties named therein and the holders named therein, relating to the Closing Date Exchange.
“Closing Date Exchange Documentation” means, collectively, the Closing Date Exchange Agreement and all definitive documentation governing, or related to, the Closing Date Exchange, this Agreement and the Closing Date Exchanged Existing Debt, including all exchange agreements, consent agreements, indentures, security agreements, pledge agreements, certificates, instruments and other agreements.
“Closing Date Exchanged Existing Debt” means $162,996,000 aggregate principal amount of the term loans under the Existing Term Loan Agreement.
“Closing Date Transactions” shall mean (1) the consummation of the Closing Date Exchange, (2) the entry into and effectiveness of this Agreement and the incurrence of the Initial Term Loans and (3) the consummation of the Closing Date Exchange.
“Code” means the U.S. Internal Revenue Code of 1986, as amended from time to time, and rules and regulations related thereto.
“Collateral” means all property or assets of the Borrower and the Guarantors (whether now owned or hereafter arising or acquired) that secure the Obligations with respect to the Loan Obligations under the Collateral Documents.
“Collateral Documents” means, collectively, the First Lien Intercreditor Agreement, the Junior Lien Intercreditor Agreement, the First Lien Collateral Agency Agreement, the First Lien Joinder, the Security Agreement, the Pledge Agreement, the Intellectual Property Security Agreements and any collateral agency agreement related to any of the foregoing, in each case, if any, and each of the other agreements, instruments or documents that creates, perfects or evidences, or purports to create, perfect or evidence, a Lien on any Collateral in favor of the Administrative Agent or the 1.75 Pari Passu Lien Collateral Agent, as applicable, for the benefit of the Secured Parties as security for the Loan Obligations, in each case, to be entered on or after the Closing Date.
“Collateral Ratio” means the ratio of the aggregate fair market value of the Collateral (to the extent the Liens securing such Collateral have been perfected) (as determined in good faith by Holdings’ chief financial officer) to the aggregate principal amount of Collateralized Debt as of such date of determination.
“Collateralized Debt” means (i) the aggregate principal amount of all outstanding Indebtedness and all letters of credit secured by Liens on the Collateral, plus (ii) the aggregate amount of all unfunded commitments under all revolving credit facilities or revolving lines of credit secured by Liens on the Collateral, plus (iii) without duplication, the aggregate principal amount of Indebtedness that at the time of determination would be permitted to be incurred under this Agreement and secured by Liens on the Collateral pursuant to clause (i)(a), (i)(c) and (i)(f) under the definition of “Permitted Liens,” but excluding any such principal amount of potential Indebtedness to the extent any outstanding debt instrument of Holdings or the Borrower would prohibit the incurrence of a Lien in respect thereof at such time, but in each case, excluding Indebtedness, letters of credit and unfunded commitments secured by Liens on the Collateral that rank junior to the Liens on the Collateral securing the Loans.
“Commission” means the U.S. Securities and Exchange Commission.
“Common Equity” of any Person means Capital Stock of such Person that is generally entitled to (a) vote in the election of directors of such Person or (b) if such Person is not a corporation, vote or otherwise participate in the selection of the governing body, partners, managers or others that will control the management or policies of such Person.
“Company Acquisition Price” has the meaning set forth in the definition of “Side Letter”.
“Compensation Period” has the meaning specified in Section 2.10(b)(ii).
“Competitors” means those Persons identified in writing to the Administrative Agent and the Initial Term Lenders on or prior to the Closing Date as competitors or who are clearly identifiable Affiliates of such Persons solely by similarity of such Affiliate’s name.
“Consolidated Cash Flow Available for Fixed Charges” means, for any period, Consolidated Net Income for such period plus (each to the extent deducted in calculating such Consolidated Net Income and determined in accordance with GAAP) the sum for such period, without duplication, of:
(a) provision for taxes based on income or profits or capital gains, including U.S. federal, state, non-U.S., franchise, excise, value added and similar taxes and foreign withholding taxes of such Person paid or accrued during such period, including any penalties and interest relating to such taxes or arising from any tax examinations,
(b) Consolidated Interest Expense,
(c) depreciation and amortization expenses and other non-cash charges to earnings,
(d) any fees, expenses, charges or losses (other than depreciation or amortization expense) related to any Equity Offering, Permitted Investment, acquisition, disposition, recapitalization or the incurrence of Indebtedness permitted to be incurred by this Agreement (including a refinancing thereof) (whether or not successful), including (i) such fees, expenses or charges related to the making of Loans hereunder and (ii) any amendment or other modification of the Loans hereunder or other Indebtedness,
(e) any other non-cash charges, including any write-offs, write-downs, expenses, losses or items, excluding any such charge that represents an accrual or reserve for a cash expenditure for a future period,
(f) costs of surety bonds incurred in such period in connection with financing activities,
(g) any costs or expense incurred by Holdings, the Borrower or a Restricted Subsidiary pursuant to any management equity plan or stock option plan or any other management or employee benefit plan or agreement or any stock subscription or shareholder agreement, to the extent that such cost or expenses are funded with cash proceeds contributed to the capital of Holdings or net cash proceeds of an issuance of Qualified Stock solely to the extent that such net cash proceeds are excluded from the calculation set forth in clause (iii) of Section 6.04(a),
(h) effects of adjustments (including the effects of such adjustments pushed down to Holdings and its Restricted Subsidiaries) in any line item in such Person’s consolidated financial statements in accordance with GAAP resulting from the application of purchase accounting, or the amortization or write-off of any amounts thereof, net of taxes,
(i) any impairment charge, asset write-off or write-down pursuant to ASC 350 and ASC 360 (formerly Financial Accounting Standards Board Statement Nos. 142 and 144, respectively) and the amortization of intangibles arising pursuant to ASC 805 (formerly Financial Accounting Standards Board Statement No. 141), and
(j) cash receipts (or any netting arrangements resulting in reduced cash expenses) not included in Consolidated Cash Flow Available for Fixed Charges in any period to the extent non-cash gains relating to such receipts were deducted in the calculation of Consolidated Cash Flow Available for Fixed Charges pursuant to clause (k) below for any previous period and not added back, minus
(k) non-cash gains increasing Consolidated Net Income for such period, excluding any non-cash gains which represent the reversal of any accrual of, or cash reserve for, anticipated cash charges that reduced Consolidated Cash Flow Available for Fixed Charges in any prior period; provided that, to the extent non-cash gains are deducted pursuant to this clause (k) for any previous period and not otherwise added back to Consolidated Cash Flow Available for Fixed Charges, Consolidated Cash Flow Available for Fixed Charges shall be increased by the amount of any cash receipts (or any netting arrangements resulting in reduced cash expenses) in respect of such non-cash gains received in subsequent periods to the extent not already included therein, and plus or minus (as applicable and without duplication) to eliminate the following items to the extent reflected in Consolidated Net Income,
(l) (i) any net gain or loss resulting in such period from currency gains or losses related to Indebtedness, intercompany balances and other balance sheet items, and (ii) any unrealized net gain or loss resulting in such period from Hedging Obligations, and the application of Financial Accounting Standards Codification No. 815—Derivatives and Hedging (formerly Financing Accounting Standards Board Statement No. 133), and its related pronouncements and interpretations (or any successor provision).
“Consolidated Fixed Charge Coverage Ratio” means, with respect to any determination date, the ratio of (x) Consolidated Cash Flow Available for Fixed Charges for the prior four full fiscal quarters (the “Four Quarter Period”) for which financial results have been reported immediately preceding the determination date (the “Transaction Date”), to (y) the aggregate Consolidated Interest Incurred for the Four Quarter Period. For purposes of this definition, “Consolidated Cash Flow Available for Fixed Charges” and “Consolidated Interest Incurred” shall be calculated after giving effect on a pro forma basis for the period of such calculation to:
(a) the incurrence or the repayment, repurchase, redemption, retirement, defeasance or other discharge or the assumption by another Person that is not an Affiliate (collectively, “repayment”) of any Indebtedness of Holdings, the Borrower or any Restricted Subsidiary (and the application of the proceeds thereof) giving rise to the need to make such calculation, and any incurrence or repayment of other Indebtedness (and the application of the proceeds thereof), at any time on or after the first day of the Four Quarter Period and on or prior to the Transaction Date, as if such incurrence or repayment, as the case may be (and the application of the proceeds thereof), occurred on the first day of the Four Quarter Period, except that Indebtedness under revolving credit facilities shall be deemed to be the average daily balance of such Indebtedness during the Four Quarter Period (as reduced on such pro forma basis by the application of any proceeds of the incurrence of Indebtedness giving rise to the need to make such calculation);
(b) any Asset Disposition, Asset Acquisition (including any Asset Acquisition giving rise to the need to make such calculation as a result of Holdings, the Borrower or any Restricted Subsidiary (including any Person that becomes a Restricted Subsidiary as a result of any such Asset Acquisition) incurring Acquired Indebtedness at any time on or after the first day of the Four Quarter Period and on or prior to the Transaction Date), Investment, merger or consolidation as if such Asset Disposition, Asset Acquisition (including the incurrence or repayment of any such Indebtedness), Investment, merger or consolidation and the inclusion, notwithstanding clause (b) of the definition of “Consolidated Net Income,” of any Consolidated Cash Flow Available for Fixed Charges associated with such Asset Acquisition or other transaction as if it occurred on the first day of the Four Quarter Period; provided, however, that the Consolidated Cash Flow Available for Fixed Charges associated with any Asset Acquisition or other transaction shall not be included to the extent the net income so associated would be excluded pursuant to the definition of “Consolidated Net Income,” other than clause (b) thereof, as if it applied to the Person or assets involved before they were acquired; and
(c) the Consolidated Cash Flow Available for Fixed Charges and the Consolidated Interest Incurred attributable to discontinued operations, as determined in accordance with GAAP, shall be excluded.
Furthermore, in calculating “Consolidated Cash Flow Available for Fixed Charges” for purposes of determining the denominator (but not the numerator) of this “Consolidated Fixed Charge Coverage Ratio,”
(a) interest on Indebtedness in respect of which a pro forma calculation is required that is determined on a fluctuating basis as of the Transaction Date (including Indebtedness actually incurred on the Transaction Date) and which will continue to be so determined thereafter shall be deemed to have accrued at a fixed rate per annum equal to the rate of interest on such Indebtedness in effect on the Transaction Date, and
(b) notwithstanding the immediately preceding clause (a), interest on such Indebtedness determined on a fluctuating basis, to the extent such interest is covered by agreements relating to Interest Protection Agreements, shall be deemed to accrue at the rate per annum resulting after giving effect to the operation of such agreements.
“Consolidated Interest Expense” of Holdings for any period means the Interest Expense of Holdings, the Borrower and the Restricted Subsidiaries for such period, determined on a consolidated basis in accordance with GAAP.
“Consolidated Interest Incurred” for any period means the Interest Incurred of Holdings, the Borrower and the Restricted Subsidiaries for such period, determined on a consolidated basis in accordance with GAAP.
“Consolidated Net Income” for any period means the aggregate net income (or loss) of Holdings and its Subsidiaries for such period, determined on a consolidated basis in accordance with GAAP; provided, that there will be excluded from such net income (loss) (to the extent otherwise included therein), without duplication:
(a) the net income (or loss) of (x) any Unrestricted Subsidiary (other than a Mortgage Subsidiary) or (y) any Person (other than a Restricted Subsidiary or a Mortgage Subsidiary) that is accounted for by the equity method of accounting, except, in each case, to the extent that any such income has actually been received by Holdings, the Borrower or any Restricted Subsidiary in the form of cash dividends or similar cash distributions during such period,
(b) except to the extent includable in Consolidated Net Income pursuant to clause (a) of this definition, the net income (or loss) of any Person that accrued prior to the date that (i) such Person becomes a Restricted Subsidiary or is merged with or into or consolidated with Holdings, the Borrower or any of its Restricted Subsidiaries (except, in the case of an Unrestricted Subsidiary that is redesignated a Restricted Subsidiary during such period, to the extent of its retained earnings from the beginning of such period to the date of such redesignation) or (ii) the assets of such Person are acquired by Holdings or any Restricted Subsidiary,
(c) solely for the purpose of determining the amount available for Restricted Payments under clause (iii) of Section 6.04(a), the net income of any Restricted Subsidiary that is not a Loan Party to the extent that (but only so long as) the declaration or payment of dividends or similar distributions by such Restricted Subsidiary of that income is not permitted by operation of the terms of its charter or any agreement, instrument, judgment, decree, order, statute, rule or governmental regulation applicable to that Restricted Subsidiary during such period, except, the net income of any such Restricted Subsidiary for such period will be included in such Consolidated Net Income up to the aggregate amount of cash that could have been distributed by such Restricted Subsidiary during such period to Holdings or another Restricted Subsidiary as a dividend,
(d) the gains or losses, together with any related provision for taxes, realized during such period by Holdings, the Borrower or any Restricted Subsidiary resulting from (i) the acquisition of securities, or extinguishment of Indebtedness or Hedging Obligations or other derivative instruments (including deferred financing costs written off and premiums paid), of Holdings or any Restricted Subsidiary, (ii) any Asset Disposition by Holdings or any Restricted Subsidiary, (iii) any non-cash income (or loss) related to currency gains or losses related to Indebtedness, intercompany balances and other balance sheet items and to Hedging Obligations pursuant to Financial Accounting Standards Codification No. 815—Derivatives and Hedging (formerly Financing Accounting Standards Board Statement No. 133) and its related pronouncements and interpretations (or any successor provision) and (iv) any non-cash expense, income or loss attributable to the movement in mark-to-market valuation of foreign currencies, Indebtedness or derivative instruments pursuant to GAAP,
(e) any extraordinary, unusual and infrequent or non-recurring gain or loss (but excluding any impairment charges), in each case, less all fees and expenses relating thereto and any expenses, severance, relocation costs, curtailments or modifications to pension and post-retirement employee benefits plans, integration and other restructuring and business optimization costs, charges, reserves or expenses (including relating to acquisitions after the Closing Date), and one-time compensation charges together with any related provision for taxes, realized by Holdings, the Borrower or any Restricted Subsidiary,
(f) the cumulative effect of a change in accounting principles and changes as a result of adoption or modification of accounting policies during such period,
(g) any net after-tax gains or losses on disposal of disposed, abandoned, transferred, closed or discontinued operations,
(h) any after-tax effect of gains or losses (less all fees and expenses relating thereto) attributable to asset dispositions or abandonments other than in the ordinary course of business, as determined in good faith by Holdings,
(i) (A) any non-cash compensation expense recorded from grants of stock appreciation or similar rights, phantom equity, stock options, restricted stock, units or other rights to officers, directors, managers or employees and (B) non-cash income (loss) attributable to deferred compensation plans or trusts,
(j) any fees and expenses incurred during such period, or any amortization thereof for such period, in connection with any acquisition, Investment, recapitalization, Asset Disposition, issuance or repayment of Indebtedness, issuance of Capital Stock, refinancing transaction or amendment or modification of any debt instrument (in each case, including any such transaction consummated prior to the Closing Date and any such transaction undertaken but not completed) and any charges or non-recurring merger costs incurred during such period as a result of any such transaction, and
(k) to the extent covered by insurance or indemnification and actually reimbursed, or, so long as the Borrower has made a determination that there exists reasonable evidence that such amount will in fact be reimbursed by the insurer or indemnifying party and only to the extent that such amount is (i) not denied by the applicable carrier or indemnifying party in writing within 180 days and (ii) in fact reimbursed within 365 days of the date of such evidence (with a deduction for any amount so added back to the extent not so reimbursed within 365 days), losses and expenses with respect to liability or casualty events or business interruption shall be excluded;
provided, further, that for purposes of calculating Consolidated Net Income solely as it relates to clause (iii) of Section 6.04(a), clauses (d)(ii) and (h) above shall not be applicable.
“Consolidated Tangible Assets” of Holdings as of any date means the total amount of assets of Holdings and its Restricted Subsidiaries (less applicable reserves) on a consolidated basis at the end of the fiscal quarter for which financial results have been reported immediately preceding such date, as determined in accordance with GAAP, less: (a) non-recourse mortgages secured by inventory, net of debt issuance costs, (b) liabilities from inventory not owned, net of debt issuance costs, (c) any deferred tax assets and any valuation allowance recorded with respect thereto, (d) Intangible Assets and (e) appropriate adjustments on account of minority interests of other Persons holding equity investments in Restricted Subsidiaries, in the case of each of clauses (a) through (e) above, as reflected on the consolidated balance sheet of Holdings and its Restricted Subsidiaries as of the end of the fiscal quarter immediately preceding such date, with such pro forma adjustments to Consolidated Tangible Assets as are appropriate and consistent with the pro forma adjustment provisions set forth in the definition of “Consolidated Fixed Charge Coverage Ratio.”
“Consolidated Total Debt” of Holdings means, on any date of determination, the aggregate amount of Indebtedness of Holdings, the Borrower and Restricted Subsidiaries incurred under (without duplication): (x) Section 6.03(a) plus (y) Sections 6.03(b)(ii) and 6.03(b)(iii) plus (z) clauses (a), (c), (g), (i), (k), (n) and (u) of the definition of “Permitted Indebtedness” outstanding on the applicable date of determination. For purposes of calculating the Secured Debt Leverage Ratio, all amounts committed but not yet incurred under the SpecifiedExisting Senior Lien Credit Facility (and any Specified Refinancing Indebtedness in respect thereof (or subsequently incurred Specified Refinancing Indebtedness with respect to any applicable prior Specified Refinancing Indebtedness)) shall be deemed to have been incurred.
“control” when used with respect to any Person, means the power to direct the management and policies of such Person, directly or indirectly, whether through the ownership of voting securities, by contract or otherwise; and the terms “controlling” and “controlled” have meanings correlative to the foregoing.
“Credit Facilities” means, with respect to Holdings, the Borrower or any of its Restrictedthe Subsidiariesy Guarantors, one or more debt facilities or other financing arrangements (including commercial paper facilities or indentures) providing for revolving credit loans, term loans, letters of credit or other long-term indebtedness, including any notes, mortgages, guarantees, collateral documents, instruments and agreements executed in connection therewith , and any amendments, supplements, modifications, extensions, renewals, restatements or refundings thereof and any indentures or credit facilities or commercial paper facilities that exchange, replace, refund, refinance, extend, renew, restate, amend, supplement or modify any part of the loans, notes, other credit facilities or commitments thereunder, including any such exchanged, replacement, refunding, refinancing, extended, renewed, restated, amended, supplemented or modified facility or indenture that increases the amount permitted to be borrowed thereunder or alters the maturity thereof (provided that such increase in borrowings is permitted under Section 6.03) or adds Holdings, the Borrower or Restrictedthe Subsidiariesy Guarantors as additional borrowers or guarantors thereunder and whether by the same or any other agent, lender or group of lenders.
“Currency Agreement” of any Person means any foreign exchange contract, currency swap agreement or other similar agreement or arrangement designed to protect such Person or any of its Subsidiaries against fluctuations in currency values. For the avoidance of doubt, any Permitted Convertible Indebtedness Call Transaction will not constitute a Currency Agreement.
“Custodian” means any receiver, trustee, assignee, liquidator or similar official under any Bankruptcy Law.
“Debtor Relief Laws” means Title 11 of the United States Code, and all other liquidation, conservatorship, bankruptcy, general assignment for the benefit of creditors, moratorium, rearrangement, receivership, examinership, insolvency, reorganization, or similar debtor relief Laws of the United States or other applicable jurisdictions from time to time in effect and affecting the rights of creditors generally.
“Declined Proceeds” has the meaning specified in Section 2.03(b)(iii).
“Default” means any event, act or condition that is, or after notice or the passage of time or both would be, an Event of Default.
“Default Rate” means, with respect to any overdue Loan or interest, an interest rate equal to 2.00% per annum in excess of the interest rate otherwise applicable to such overdue Loan (or the Loan to which such overdue interest relates).
“Defaulting Lender” means, at any time, a Lender as to which the Administrative Agent has notified the Borrower that (a) such Lender has failed for two (2) or more Business Days to comply with its obligations under this Agreement to make a Loan (a “Lender Funding Obligation”) required to be funded hereunder, (b) such Lender has notified the Administrative Agent or Borrower in writing, that it will not comply with any such Lender Funding Obligation hereunder, or has defaulted on its Lender Funding Obligations under other loan agreements, credit agreements or other similar agreements in which it commits to extend credit generally or (c) such Lender has, for three (3) or more Business Days, failed to confirm in writing to the Borrower, in response to a written request of the Borrower (based on the reasonable belief that it may not fulfill its Lender Funding Obligations), that it will comply with its Lender Funding Obligations hereunder; provided, that any such Lender shall cease to be a Defaulting Lender under this clause (c) upon receipt of such confirmation by the Borrower. The Administrative Agent or Borrower will promptly send to all parties hereto a copy of any notice to the Borrower or Administrative Agent, as applicable, provided for in this definition.
“Designation Amount” has the meaning specified under the definition of “Unrestricted Subsidiary.”
“Disqualified Stock” means any Capital Stock that, by its terms (or by the terms of any security into which it is convertible or for which it is exchangeable), or upon the happening of any event, (a) matures or is mandatorily redeemable, pursuant to a sinking fund obligation or otherwise, or is redeemable at the option of the holder thereof, in whole or in part, on or prior to the Latest Maturity Date on the date of determination or (b) is convertible into or exchangeable or exercisable for (whether at the option of the issuer or the holder thereof) (i) debt securities or (ii) any Capital Stock referred to in (a) above, in each case, at any time prior to the Latest Maturity Date on the date of determination; provided, however, that any Capital Stock that would not constitute Disqualified Stock but for provisions thereof giving holders thereof (or the holders of any security into or for which such Capital Stock is convertible, exchangeable or exercisable) the right to require Holdings to repurchase or redeem such Capital Stock upon the occurrence of a change in control or asset disposition occurring prior to the Latest Maturity Date on the date of determination shall not constitute Disqualified Stock if the change in control or asset disposition provision applicable to such Capital Stock are no more favorable to such holders than the provisions of Section 6.07 or Section 6.09 (as applicable) and such Capital Stock specifically provides that Holdings will not repurchase or redeem any such Capital Stock pursuant to such provisions prior to Holdings’ repurchase of the Loans as are required pursuant to the provisions of Section 6.07 or Section 6.09 hereof (as applicable).
“Dollar” and “$” mean lawful money of the United States.
“EEA Financial Institution” means (a) any credit institution or investment firm established in any EEA Member Country that is subject to the supervision of an EEA Resolution Authority, (b) any entity established in an EEA Member Country that is a parent of an institution described in clause (a) of this definition, or (c) any financial institution established in an EEA Member Country that is a subsidiary of an institution described in clauses (a) or (b) of this definition and is subject to consolidated supervision with its parent.
“EEA Member Country” means any of the member states of the European Union, Iceland, Liechtenstein, and Norway.
“EEA Resolution Authority” means any public administrative authority or any person entrusted with public administrative authority of any EEA Member Country (including any delegee) having responsibility for the resolution of any EEA Financial Institution.
“Eligible Assignee” means (a) a Lender; (b) an Affiliate of a Lender; (c) an Approved Fund; and (d) any other Person that meets the requirements to be an assignee under Section 9.07(b), provided, that under no circumstances shall (i) any Competitor be an assignee without the prior written consent of the Borrower and, (ii) subject to clauses (k) and (l) of Section 9.07, Holdings, the Borrower or any Affiliate thereof or a natural person, be an Eligible Assignee.
“Environmental Laws” has the meaning specified in Section 5.05.
“Equity Offering” means any public or private sale, after the Closing Date, of Qualified Stock of Holdings, other than (a) an issuance by or to any Subsidiary, (b) public offerings registered on Form S-4 or S-8 or any successor form thereto or (c) any issuance pursuant to employee benefit plans or otherwise in compensation to officers, directors or employees.
“ERISA” means the Employee Retirement Income Security Act of 1974, as amended from time to time.
“EU Bail-In Legislation Schedule” means the EU Bail-In Legislation Schedule published by the Loan Market Association (or any successor person), as in effect from time to time.
“Event of Default” has the meaning specified in Section 7.01.
“Exchange” means the exchange by holders of Exchanged Existing Debt for the Initial Term Loans and cash pursuant to the Exchange Agreement.
“Exchange Act” means the United States Securities Exchange Act of 1934, as amended.
“Exchange Agreement” means that certain Exchange Agreement, dated on or about the Closing Date, among the Borrower, Holding, other guarantors named therein, the other parties named therein and the holders named therein, relating to the Exchange.
“Exchange Documentation” means, collectively, the Exchange Agreement and all definitive documentation governing, or related to, the Exchange, this Agreement and the Exchanged Existing Debt, including all exchange agreements, consent agreements, indentures, security agreements, pledge agreements, certificates, instruments and other agreements.
“Exchanged Existing Debt” means $162,996,000 aggregate principal amount of the term loans under the Existing Term Loan Agreement.
“Excluded Property” means (a) [reserved], (b) up to $50.0 million of assets received in connection with Asset Dispositions and asset swaps or exchanges as permitted by clause (c) of the definition of “Permitted Investment”; provided that such assets are not of a character that would be Collateral and Holdings is not able to obtain a Lien on such assets in favor of the Administrative Agent or the 1.75 Pari Passu Lien Collateral Agent, as applicable, for the benefit of the Secured Parties after the use of reasonable efforts, (c) personal property where the cost of obtaining a security interest or perfection thereof exceeds its benefits (as reasonably determined by Holdings’ Board of Directors in a board resolution delivered to the Administrative Agent), (d) assets securing Purchase Money Indebtedness, Non-Recourse Indebtedness and Refinancing Non-Recourse Indebtedness to the extent the terms of such Indebtedness prohibit the incurrence of any other Liens thereon; provided that Holdings uses reasonable efforts to obtain Liens on the assets securing such Indebtedness, in favor of the Administrative Agent or the 1.75 Pari Passu Lien Collateral Agent, as applicable, for the benefit of the Secured Parties, that is junior to the Liens securing such Indebtedness and otherwise consistent with priorities set forth in the First Lien Intercreditor Agreement, (e) real property located outside the United States, (f) Unentitled Land, (g) equity interests in Unrestricted Subsidiaries, except for JV Holding Companies, (h) any property in a community under development with a dollar amount of investment as of the most recent month-end (as determined in accordance with GAAP) of less than $2.0 million or with less than 10 lots remaining, (i) any assets or property excluded from the Collateral pursuant to clause (ii) of the proviso of Article 2 of the Security Agreement and (j) up to $25.0 million of cash or cash equivalents that are pledged to secure obligations permitted to be secured pursuant to clause (d) of the definition of “Permitted Liens” if, after the use of reasonable efforts by Holdings to obtain a Lien on such cash or cash equivalents in favor of the Administrative Agent or the 1.75 Pari Passu Lien Collateral Agent, as applicable, for the benefit of the Secured Parties, the holders of the obligations secured by such cash and cash equivalents do not consent to the granting of such Liens.
“Excluded Subsidiary” means (a) each non-wholly owned Subsidiary and (b) each Subsidiary of Holdings (other than the Borrower) that has a book value of less than $2.0 million, measured at the end of the most recently completed fiscal year for which financial statements have been provided as set forth under Section 6.12 (or if acquired or created subsequent to such delivery, measured at the most recent practicable date (or estimated in the reasonable judgment of Holdings)); provided that in each case, such Subsidiary has not guaranteed any other Applicable Debt of Holdings or the Borrower; provided, further, that in no event shall Excluded Subsidiaries comprise in the aggregate more than 2.0% of the Consolidated Tangible Assets, measured at the end of the most recently completed fiscal year for which financial statements have been provided as set forth under Section 6.12 hereof.
“Excluded Taxes” means any of the following Taxes imposed on or with respect to any Agent or Lender or required to be withheld or deducted from a payment to any Lender or an Agent, (a) Taxes imposed on or measured by net income (however denominated), franchise Taxes, and branch profits Taxes, in each case, (i) imposed as a result of such Lender or Agent being organized under the laws of, or having its principal office or, in the case of any Lender, its applicable lending office located in, the jurisdiction imposing such Tax (or any political subdivision thereof) or (ii) that are Other Connection Taxes, (b) in the case of a Lender, United States federal withholding Taxes imposed on amounts payable to or for the account of such Lender with respect to an applicable interest in a Loan or Term Commitment pursuant to a law in effect on the date on which (i) such Lender acquires such interest in the Loan or Term Commitment (other than pursuant to an assignment request by the Borrower under Section 3.07) or (ii) such Lender changes its Lending Office, except in each case to the extent that, pursuant to Section 3.01, amounts with respect to such Taxes were payable either to such Lender's assignor immediately before such Lender acquired the applicable interest in a Loan or Term Commitment or to such Lender immediately before it changed its Lending Office, (c) Taxes attributable to such Lender’s or Agent’s failure to comply with Section 3.01(f) and (d) any withholding Taxes imposed under FATCA.
“Existing 8.000% Unsecured Notes” means the Borrower’s 8.000% Senior Notes due 2027 issued pursuant to the Existing 8.000% Unsecured Notes Indenture.
“Existing 8.000% Unsecured Notes Indenture” means the Indenture, dated as of November 5, 2014, among the Borrower, the guarantors party thereto and Wilmington Trust, National Association, as trustee (as amended or supplemented from time to time).
“Existing 13.5%/5.0% Unsecured Notes” means the Borrower’s 13.5% Senior Notes due 2026 and 5.0% Senior Notes due 2040, each(i) issued pursuant to the Existing 13.5%/5.0% Unsecured Notes Indenture and (ii) outstanding as of the Amendment No. 1 Effective Date immediately after giving effect to the transactions contemplated by the Amendment No. 1 Exchange Agreements.
“Existing 13.5%/5.0% Unsecured Notes Indenture” means the Indenture, dated as of February 1, 2018, among the Borrower, the guarantors named therein and Wilmington Trust, National Association, as trustee, governing the Existing 13.5%/ Unsecured Notes and the Existing 5.0% Unsecured Notes (as amended or supplemented from time to time in accordance with this Agreement).
“Existing 5.0% Unsecured Notes Exchange” means (a) the Borrower’s offer to exchange, and subsequent exchange of, 164,860,000 aggregate principal amount of its Existing Secured Notes for a combination of cash, as applicable, and 1.75 Lien Notes pursuant to the terms and conditions set forth in the confidential offering memorandum and consent solicitation statement of the Borrower in respect of such offer and exchange, dated November 4, 2019 (as amended or supplemented from time to time), and (b) all payments made and securities issued in connection with the foregoing.5.0% Senior Notes due 2026 (i) issued pursuant to the Existing 13.5%/5.0% Unsecured Notes Indenture and (ii) outstanding as of the Amendment No. 1 Effective Date immediately after giving effect to the transactions contemplated by the Amendment No. 1 Exchange Agreements.
“Existing RevolvingSenior Lien Credit AgreementFacility” means the credit facility under that certain $125,000,000 Credit Agreement, dated as of October 31, 2019, as amended by the First Amendment dated as of November 27, 2019, the Second Amendment dated as of August 19, 2022, the Third Amendment dated as of September 25, 2023, and as further amended, restated, supplemented or modified from time to time in accordance with this Agreement, among the Borrower, Holdings, the other guarantors party thereto, the lenders party thereto and Wilmington Trust, National Association, as administrative agent.
“Existing Secured Notes” means the Borrower’s 10.000% Senior Secured Notes due 2022 and the Borrower’s 10.500% Senior Secured Notes due 2024, issued under the Existing Secured Notes Indenture.
“Existing Secured Notes Indenture” means the Indenture, dated as of July 27, 2017 (as amended, supplemented, amended and restated or otherwise modified from time to time), among the Borrower, Holdings and the other guarantors party thereto and the trustee named therein and the collateral agent named therein.
“Existing Term Loan Agreement” means that certain $212,500,000 Credit Agreement, dated as of January 29, 2018, as amended by the First Amendment dated as of May 14, 2018, as amended by the Second Amendment dated as of October 31, 2019 and as further amended, restated, supplemented or otherwise modified from time to time, among the Borrower, Holdings, the guarantors party thereto, the lenders party thereto and Wilmington Trust, National Association, as administrative agent.
“Existing Unsecured Indebtedness” means (i) the Existing 13.5%/ Unsecured Notes and (ii) the Existing 5.0% Unsecured Notes, (ii) the obligations under the Existing Term Loan Agreement and (iii) the Existing 8.000% Unsecured Notes.
“Extended Term Loan Facility” means a facility providing for the Borrowing of Extended Term Loans.
“Extended Term Loans” shall have the meaning assigned to such term in Section 2.13(a)(ii).
“Extending Term Lender” shall have the meaning assigned to such term in Section 2.13(a)(ii).
“Extension” shall have the meaning specified in Section 2.13(a).
“Extension Offer” shall have the meaning specified in Section 2.13(a).
“Facility” means the Term Loan Facility.
“Fair Market Value” means, with respect to any asset, the price (after taking into account any liabilities relating to such assets) that would be negotiated in an arm’s-length transaction for cash between a willing seller and a willing and able buyer, neither of which is under any compulsion to complete the transaction, as such price is determined in good faith by the Board of Directors of Holdings or a duly authorized committee thereof, as evidenced by a resolution of such Board of Directors or committee.
“FATCA” means Sections 1471 through 1474 of the Code, as of the date of this Agreement (or any amended or successor version that is substantively comparable and not materially more onerous to comply with), any current or future regulations with respect thereto or official administrative interpretations thereof, any agreements entered into pursuant to Section 1471(b)(1) of the Code (or any amended or successor version described above), any intergovernmental agreements entered into to implement such Sections of the Code, and any laws, fiscal or regulatory legislation, rules, guidance notes and practices implementing the foregoing.
“Federal Funds Rate” means, for any day, the rate calculated by the Federal Reserve Bank of New York based on such day’s federal funds transactions by depositary institutions, as determined in such manner as shall be set forth on the Federal Reserve Bank of New York’s Website from time to time, and published on the next succeeding Business Day by the Federal Reserve Bank of New York as the effective federal funds rate.
“Financing Lease Obligations” of any Person means the obligations of such Person that is required to be accounted for as a financing or capital lease (and, for the avoidance of doubt, not a straight-line or operating lease) on both the balance sheet and income statement for financial reporting purposes in accordance with GAAP. At the time any determination thereof is to be made, the amount of the liability in respect of a financing or capital lease would be the amount required to be reflected as a liability on such balance sheet (excluding the footnotes thereto) in accordance with GAAP.
“First Lien Collateral Agency Agreement” means the First Lien Collateral Agency Agreement dated as of October 31, 2019, (as amended, restated, supplemented or otherwise modified from time to time (including by the First Lien Joinder and any other joinders thereto)), among the Borrower, Holdings and certain of their Subsidiaries, the Administrative Agent, the 1.125 Lien Collateral Agent (as defined therein), the 1.25 Lien Collateral Agent (as defined therein), the 1.5 Lien Collateral Agent (as defined therein),, the Joint First Lien Collateral Agent and any other representative of the holders of any other Obligations permitted to be incurred and secured under this Agreement, as may be amended, restated, supplemented or otherwise modified from time to time (including by the First Lien CAA/ICA Joinder and other joinders thereto).
“First Lien CAA/ICA Joinder” means the joinder, dated as of the Closing Date, to the First Lien Collateral Agency Agreement and the First Lien Intercreditor Agreement, among Wilmington Trust, National Association, in its capacities as Administrative Agent and the 1.75 Pari Passu Lien Collateral Agent, with receipt acknowledged by the other first lien representatives and first lien collateral agents parties to the First Lien Collateral Agency Agreement and the First Lien Intercreditor Agreement.
“First Lien Intercreditor Agreement” means the First Lien Intercreditor Agreement, dated as of October 31, 2019, (as amended, restated, supplemented or otherwise modified from time to time (including by the First Lien Joinder and any other joinders thereto)), among the Borrower, Holdings and certain of their Subsidiaries, the Firstthe Guarantors, Wilmington Trust, National Association, in its capacity as Collateral Agent hereunder, the 1.125 Lien Trustee, the 1.125 Lien Collateral Agents (as defined therein), the First1.25 Lien Representatives (as defined therein),Trustee, the 1.25 Lien Collateral Agent and the Joint First Lien Collateral Agent and any other representative of the holders of any other Obligations permitted to be incurred and secured under this Agreement, as may be amended, restated, supplemented or otherwise modified from time to time (including by the First Lien ICA/ICA Joinder and other joinders thereto).
“First Lien Joinder” means the Joinder, dated as of October 5, 2023, to the First Lien Collateral Agency Agreement and the First Lien Intercreditor Agreement, among Wilmington Trust, National Association, in its capacities as set forth therein, with receipt acknowledged by the other first lien representatives and first lien collateral agents parties to the First Lien Collateral Agency Agreement and the First Lien Intercreditor Agreement.
“Four Quarter Period” has the meaning specified in the definition of “Consolidated Fixed Charge Coverage Ratio”.
“Fund” means any Person (other than a natural person) that is engaged in making, purchasing, holding or otherwise investing in commercial loans and similar extensions of credit in the ordinary course.
“GAAP” means generally accepted accounting principles set forth in the opinions and pronouncements of the Accounting Principles Board of the American Institute of Certified Public Accountants and statements and pronouncements of the Financial Accounting Standards Board or in such other statements by such other entity as may be approved by a significant segment of the accounting profession of the United States, as in effect from time to time.
“Governmental Authority” means any nation or government, any state or other political subdivision thereof, any agency, authority, instrumentality, regulatory body, court, administrative tribunal, central bank or other entity exercising executive, legislative, judicial, taxing, regulatory or administrative powers or functions of or pertaining to government (including any supra-national body exercising such powers or functions).
“Guarantee” means the guarantee of the Loan Obligations by each Guarantor under this Agreement.
“guarantee” means any obligation, contingent or otherwise, of any Person directly or indirectly guaranteeing any Indebtedness of any other Person and, without limiting the generality of the foregoing, any obligation, direct or indirect, contingent or otherwise, of such Person: (a) to purchase or pay (or advance or supply funds for the purchase or payment of) such Indebtedness of such other Person (whether arising by virtue of partnership arrangements, or by agreement to keep-well, to purchase assets, goods, securities or services, to take-or-pay, or to maintain financial statement conditions or otherwise) or (b) entered into for purposes of assuring in any other manner the obligee of such Indebtedness of the payment thereof or to protect such obligee against loss in respect thereof, in whole or in part; provided, that the term “guarantee” does not include endorsements for collection or deposit in the ordinary course of business. The term “guarantee” used as a verb has a corresponding meaning.
“Guarantors” has the meaning specified in the introductory paragraph to this Agreement.
“Hedging Obligations” means, with respect to any Person, the obligations of such Person under any Interest Protection Agreement, commodity swap agreement, commodity cap agreement, commodity collar agreement, Currency Agreement or similar agreement providing for the transfer or mitigation of interest rate, commodity price or currency risks either generally or under specific contingencies.
“Historical Financial Statements” has the meaning specified in Section 5.07.
“Holdings” has the meaning specified in the introductory paragraph to this Agreement.
“Incremental Amendment” has the meaning specified in Section 2.16.
“Incremental Effective Date” has the meaning specified in Section 2.16.
“Incremental Lenders” has the meaning specified in Section 2.16.
“Incremental Term Loan Facility” means a facility providing for the Borrowing of Incremental Term Loans.
“Incremental Term Loans” has the meaning specified in Section 2.16.
“incurrence” has the meaning specified in Section 6.03(a) hereof.
“Indebtedness” of any Person means, without duplication,
(a) any liability of such Person (i) for borrowed money or under any reimbursement obligation relating to a letter of credit or other similar instruments (other than standby letters of credit or similar instruments issued for the benefit of, or surety, performance, completion or payment bonds, earnest money notes or similar purpose undertakings or indemnifications issued by, such Person in the ordinary course of business), (ii) evidenced by a bond, note, debenture or similar instrument (including a purchase money obligation) given in connection with the acquisition of any businesses, properties or assets of any kind or with services incurred in connection with capital expenditures (other than any obligation to pay a contingent purchase price which, as of the date of incurrence thereof, is not required to be recorded as a liability in accordance with GAAP), or (iii) in respect of Financing Lease Obligations (to the extent of the Attributable Debt in respect thereof),
(b) any Indebtedness of others that such Person has guaranteed to the extent of the guarantee; provided, however, that Indebtedness of Holdings and its Restricted Subsidiaries will not include the obligations of Holdings or a Restricted Subsidiary under warehouse lines of credit of Mortgage Subsidiaries to repurchase mortgages at prices no greater than 98% of the principal amount thereof, and upon any such purchase the excess, if any, of the purchase price thereof over the Fair Market Value of the mortgages acquired, will constitute Restricted Payments subject to Section 6.04 hereof,
(c) to the extent not otherwise included, the obligations of such Person under Hedging Obligations to the extent recorded as liabilities not constituting Interest Incurred, net of amounts recorded as assets in respect of such obligations, in accordance with GAAP, and
(d) all Indebtedness of others secured by a Lien on any asset of such Person, whether or not such Indebtedness is assumed by such Person;
provided, that Indebtedness shall not include accounts payable, liabilities to trade creditors of such Person or other accrued expenses arising in the ordinary course of business or completion guarantees entered into in the ordinary course of business. The amount of Indebtedness of any Person at any date shall be (i) the outstanding balance at such date of all unconditional obligations as described above, net of any unamortized discount to be accounted for as Interest Expense, in accordance with GAAP, (ii) the maximum liability of such Person for any contingent obligations under clause (a) of this definition at such date, net of an unamortized discount to be accounted for as Interest Expense in accordance with GAAP, (iii) in the case of clause (c) above, zero, if permitted under clause (f) of the definition of “Permitted Indebtedness” or, otherwise, the net termination amount payable in respect thereof, and (iv) in the case of clause (d) above, the lesser of (x) the fair market value of any asset subject to a Lien securing the Indebtedness of others on the date that the Lien attaches and (y) the amount of the Indebtedness secured.
For the avoidance of doubt, obligations of any Person under a Permitted Bond Hedge transaction or a Permitted Warrant transaction shall be deemed not to constitute Indebtedness.
“Indemnified Liabilities” has the meaning specified in Section 9.05.
“Indemnified Taxes” means (a) Taxes, other than Excluded Taxes, imposed on or with respect to any payment made by or on account of any obligation of any Loan Party under any Loan Document and (b) to the extent not otherwise described in (a), Other Taxes.
“Indemnitees” has the meaning specified in Section 9.05.
“Initial Term Commitment” means, as to each Initial Term Lender, (i) the outstanding principal amount plus accrued and unpaid interest of such Closing Date Exchanged Existing Debt exchanged for the principal amount of the Initial Term Loans, as set forth opposite such Initial Term Lender’s name in Schedule 2.01 under the caption “Initial Term Commitment”. The aggregate principal amount of the Initial and (ii) such Lender’s Amendment No. 1 Term Commitments as of the Closing Date is $81,498,000.
“Initial Term Lenders” means the, at any time, any Lenders listed on Schedule 2.01that has an Initial Term Commitment or an Initial Term Loan at such time.
“Initial Term Loan” has the meaning specified inmeans a Loan made pursuant to Section 2.01(a) or (b).
“Initial Term Loan Facility” means the facility providing for the incurrence of Initial Term Loans.
“Intangible Assets” of Holdings means all unamortized debt discount and expense, unamortized deferred charges, goodwill, patents, trademarks, service marks, trade names, copyrights and all other items (other than any deferred tax assets) which would be treated as intangibles on the consolidated balance sheet of Holdings and its Restricted Subsidiaries prepared in accordance with GAAP.
“Intellectual Property Security Agreements” has the meaning set forth in the Security Agreement.
“Intercreditor Agreements” means, collectively (a) the First Lien Intercreditor Agreement and (b) the Junior Lien Intercreditor Agreement.
“Interest Expense” of any Person for any period means, without duplication, the aggregate amount of (a) interest which, in conformity with GAAP, would be set opposite the caption “interest expense” or any like caption on an income statement for such Person (including imputed interest included in Financing Lease Obligations, all commissions, discounts and other fees and charges owed with respect to letters of credit and bankers’ acceptance financing, the net costs (but reduced by net gains) associated with Currency Agreements and Interest Protection Agreements, amortization of other financing fees and expenses, the interest portion of any deferred payment obligation, amortization of discount or premium, if any, and all other noncash interest expense (other than interest and other charges amortized to cost of sales)), and (b) all interest actually paid by Holdings or a Restricted Subsidiary under any guarantee of Indebtedness (including a guarantee of principal, interest or any combination thereof) of any Person other than Holdings, the Borrower or any Restricted Subsidiary during such period; provided, that Interest Expense shall exclude any expense associated with the complete write-off of financing fees and expenses in connection with the repayment of any Indebtedness.
“Interest Incurred” of any Person for any period means, without duplication, the aggregate amount of (a) Interest Expense and (b) all capitalized interest and amortized debt issuance costs.
“Interest Payment Date” means, as to each Loan, (a) the last Business Day of each January, April, July and October to occur while such Loan is outstanding, commencing with the first such Interest Payment Date to occur immediately after the Closing Date, (b) each date of any mandatory repayment made in respect thereof prior to the Termination Date of such Loan and (c) the Maturity Date of such Loan.
“Interest Protection Agreement” of any Person means any interest rate swap agreement, interest rate collar agreement, option or futures contract or other similar agreement or arrangement designed to protect such Person or any of its Subsidiaries against fluctuations in interest rates with respect to Indebtedness permitted to be incurred under this Agreement. For the avoidance of doubt, any Permitted Convertible Indebtedness Call Transaction will not constitute an Interest Protection Agreement.
“Investment Company Act” means the Investment Company Act of 1940, as amended.
“Investments” of any Person means (a) all investments by such Person in any other Person in the form of loans, advances or capital contributions, (b) all guarantees of Indebtedness of any other Person by such Person, (c) all purchases (or other acquisitions for consideration) by such Person of Indebtedness, Capital Stock or other securities of any other Person and (d) all other items that would be classified as investments in any other Person (including purchases of assets outside the ordinary course of business) on a balance sheet of such Person prepared in accordance with GAAP.
“IRS” means the United States Internal Revenue Service.
“Joint First Lien Collateral Agent” means Wilmington Trust, National Association, in its capacity as Joint First Lien Collateral Agent under the First Lien Collateral Agency Agreement.
“Junior Lien Indebtedness” has the meaning specified in Section 6.20.
“Junior Lien Intercreditor Agreement” means the Second Amended and Restated Intercreditor Agreement, dated as of October 31, 2019, among the Borrower, Holdings, the other grantors party from time to time thereto, the Administrative Agent, the other Senior Representatives, the Senior Collateral Agents, the Junior Representatives, the Junior Collateral Agents, the Mortgage Tax Collateral Agent (in each case to the extent not defined herein, as defined therein) and the other parties thereto, as may be further amended, restated, supplemented or otherwise modified from time to time (including by the Junior Lien ICA Joinder and other joinders thereto).any intercreditor agreement setting forth the relevant priority of Liens securing the Obligations subject to the First Lien Intercreditor Agreement, on the one hand, and the Second Lien Obligations (as defined therein (or the equivalent term therein)), on the other hand, which shall be on substantially the same terms as the First Lien Intercreditor Agreement (with the Loan Obligations being treated as senior priority obligations under such intercreditor agreement), including with respect to the release of Guarantees and Collateral (or on terms not materially less favorable to the Lenders as established by the Officer’s Certificate delivered pursuant to the terms of Section 8.08(d)), in a form reasonably satisfactory to the Borrower, the Guarantors and Wilmington Trust, National Association, in its capacities as Administrative Agent and 1.75 Pari Passu Lien Collateral Agent.
“Junior Lien ICA Joinder” means the joinder, dated as of the Closing Date, to the Junior LienSecond Amended and Restated Intercreditor Agreement, dated as of October 31, 2019, among the Borrower, Holdings, the other grantors party thereto, Wilmington Trust, National Association in its capacities as Administrative Agent the 1.75 Pari Passu Lien Collateral Agent and in the other capacities set forth therein and the other parties thereto.
“JV Holding Company” means a Subsidiary of JV Holdings, the only material asset of which constitutes Capital Stock of one or more joint ventures owned on the Closing Date or Permitted Joint Ventures in existence on the Closing Date or acquired or formed after the Closing Date; provided that neither JV Holdings nor K. Hovnanian JV Services Company, L.L.C. shall be deemed a JV Holding Company.
“JV Holdings” means K. Hovnanian JV Holdings, L.L.C.
“L/C Collateral” means cash and cash equivalents that secure obligations permitted to be secured pursuant to clause (d) of the definition of “Permitted Liens”.
“Land Banking Collateral Sales” has the meaning specified in the definition of “Asset Disposition”.
“Land Banking Transaction” means an arrangement relating to Property now owned or hereafter acquired whereby Holdings, the Borrower or a Restricted Subsidiary sells such Property to a Person (other than Holdings, the Borrower or a Restricted Subsidiary) and Holdings, the Borrower or a Restricted Subsidiary, as applicable, has an option to purchase such Property back on a specified schedule.
“Latest Maturity Date” means, at any date of determination, the latest Maturity Date or expiration date applicable to any Loan or Term Commitment hereunder at such time, as extended in accordance with this Agreement from time to time.
“Laws” means, collectively, all applicable international, foreign, Federal, state, commonwealth and local statutes, treaties, rules, guidelines, regulations, ordinances, codes and administrative or judicial precedents or authorities, including the interpretation or administration thereof by any Governmental Authority charged with the enforcement, interpretation or administration thereof, and all applicable administrative orders, directed duties, requests, licenses, authorizations and permits of, and agreements with, any Governmental Authority, in each case whether or not having the force of law.
“Lender” has the meaning specified in the introductory paragraph of this Agreement.
“Lender Funding Obligation” has the meaning specified in the definition of “Defaulting Lender.”
“Lending Office” means, as to any Lender, the office or offices of such Lender described as such in such Lender’s Administrative Questionnaire, or such other office or offices as a Lender may from time to time notify the Borrower and the Administrative Agent.
“Lien” means, with respect to any Property, any mortgage, lien, pledge, charge, security interest or encumbrance of any kind in respect of such Property. For purposes of this definition, a Person shall be deemed to own, subject to a Lien, any Property which it has acquired or holds subject to the interest of a vendor or lessor under any conditional sale agreement, capital lease or other title retention agreement relating to such Property.
“Loan” means an extension of credit by a Lender to the Borrower in the form of a Term Loan.
“Loan Documents” means, collectively, (a) this Agreement, (b) the Notes, (c) the Collateral Documents, (d) the Agent Fee Letter (for purposes of Section 9.05 only), (e) each other document, instrument or agreement entered into by a Loan Party for the benefit of any Agent or any Lender in connection with the foregoing and, (f) Amendment No. 1 and (g) any amendment, waiver, supplement or other modification to any of the foregoing.
“Loan Notice” means a notice of a Borrowing delivered pursuant to Section 2.02(a), which, if in writing, shall be substantially in the form of Exhibit A-1.
“Loan Obligations” means all advances to, and debts, liabilities, obligations, covenants and duties of, any Loan Party arising under any Loan Document or otherwise with respect to any Loan, whether direct or indirect (including those acquired by assumption), absolute or contingent, due or to become due, now existing or hereafter arising and including interest and fees that accrue after the commencement by or against any Loan Party of any proceeding under any Debtor Relief Laws naming such Person as the debtor in such proceeding, regardless of whether such interest and fees are allowed claims in such proceeding. Without limiting the generality of the foregoing, the Loan Obligations of the Loan Parties under the Loan Documents include the obligation to pay principal, interest, charges, expenses, fees, Attorney Costs indemnities and other amounts payable by any Loan Party under any Loan Document.
“Loan Parties” means, collectively, Holdings, the Borrower and each Subsidiary Guarantor.
“Majority Lenders” of any Class, means those Lenders which would constitute the Required Lenders under, and as defined in, this Agreement if all outstanding Loan Obligations of the other Classes under this Agreement were repaid in full and any Term Commitments with respect to such other Classes were terminated.
“Make-Whole Premium” means, as of any date of determination, an amount equal to the excess, if any, of (a) the present value as of such prepayment date of (i) the principal amount of such Loans being prepaid plus the Prepayment Premium that would be payable in connection with a prepayment of such Loans occurring on November 15, 2021 plus (ii) all interest that would have accrued on the principal amount of such Loans being prepaid from such date through November 15, 2021 (excluding any accrued but unpaid interest to such prepayment date), in each case computed using a discount rate equal to the Treasury Rate (determined as of such prepayment date) plus 0.50%, over (b) the principal amount of such Loans being prepaid.
“Marketable Securities” means (a) equity securities that are listed on a national securities exchange and (b) debt securities that are rated by a nationally recognized rating agency, listed on a national securities exchange or covered by at least two reputable market makers.
“Material Adverse Effect” has the meaning specified in Section 5.01.
“Material Intellectual Property” means any intellectual property that is material to the business of Holdings, the Borrower and the Restricted Subsidiaries, taken as a whole (in the reasonable determination of the Borrower in good faith).
“Maturity Date” means with respect to the Initial Term Loan Facility, January 31, 2028; provided that the reference to Maturity Date (i) with respect to Refinancing Term Loans shall be the final maturity date as specified in the applicable Refinancing Term Loan Amendment and, (ii) with respect to Extended Term Loans shall be the final maturity date as specified in the applicable Extension Offer and (iii) with respect to Incremental Term Loans shall be the final maturity date as specified in the applicable Incremental Amendment.
“Maturity/Weighted Average Life Excluded Amount” means (a) $200.0 million less (b) the aggregate outstanding principal amount of Indebtedness incurred utilizing the Maturity/Weighted Average Life Excluded Amount.
“Maximum Rate” has the meaning specified in Section 9.10.
“Minimum Extension Condition” shall have the meaning specified in Section 2.13(b).
“Moody’s” means Moody’s Investors Service, Inc. or any successor to its debt rating business.
“Mortgage Subsidiary” means any Subsidiary of Holdings substantially all of whose operations consist of the mortgage lending business.
“Most Recent Fiscal Quarter” means the most recently completed fiscal quarter for which financial statements have been provided pursuant to Section 6.12 hereof.
“Net Cash Proceeds” means i) with respect to an Asset Disposition, payments received in cash (including any such payments received by way of deferred payment of principal pursuant to a note or installment receivable or otherwise (including any cash received upon sale or disposition of such note or receivable), but only as and when received), excluding any other consideration received in the form of assumption by the acquiring Person of Indebtedness or other obligations relating to the Property disposed of in such Asset Disposition, or received in any other non-cash form unless and until such non-cash consideration is converted into cash therefrom, in each case, net of all legal, title and recording tax expenses, commissions and other fees and expenses incurred, and all federal, state and local taxes required to be accrued as a liability under GAAP as a consequence of such Asset Disposition, and in each case net of a reasonable reserve for the after-tax cost of any indemnification or other payments (fixed and contingent) attributable to the seller’s indemnities or other obligations to the purchaser undertaken by Holdings, the Borrower or any of its Restricted Subsidiaries in connection with such Asset Disposition, and net of all payments made on any Indebtedness which is secured by or relates to such Property (other than Indebtedness secured by Liens on the Collateral) in accordance with the terms of any Lien or agreement upon or with respect to such Property or which such Indebtedness must by its terms or by applicable Law be repaid out of the proceeds from such Asset Disposition, and net of all contractually required distributions and payments made to minority interest holders in Restricted Subsidiaries or joint ventures as a result of such Asset Disposition; and
ii) with respect to the incurrence or issuance of any Indebtedness by Holdings, the Borrower or any Restricted Subsidiary meeting the definition of Other Prepayment Event, the excess, if any, of (i) the sum of cash and Cash Equivalents received in connection with such incurrence or issuance over (ii) all taxes paid or reasonably estimated to be payable, and all fees, commissions, costs and other out-of-pocket expenses and other customary expenses incurred, in each case by the applicable party in connection with such incurrence or issuance.
“New 1.125 Lien Basket Debt” has the meaning specified in clause (a)(ii) of the definition of “Permitted Indebtedness”.
“New 1.25 Lien Basket Debt” has the meaning specified in clause (a)(iii) of the definition of “Permitted Indebtedness”.
“New 1.75 Lien Basket Debt” has the meaning specified in clause (i) of the definition of “Permitted Indebtedness”.
“New Secured Notes” means, collectively, the 1.125 Lien Notes, and the 1.25 Lien Notes, the 1.5 Lien Notes and the 1.75 Lien Notes.
“Non-Defaulting Lender” means, at any time, a Lender that is not a Defaulting Lender.
“Non-Recourse Indebtedness” with respect to any Person means Indebtedness of such Person for which (a) the sole legal recourse for collection of principal and interest on such Indebtedness is against the specific property, including for the avoidance of doubt, assets directly related thereto or derived therefrom, identified in the instruments evidencing or securing such Indebtedness or other property of such Person financed pursuant to the Credit Facility of such Person under which such Indebtedness was incurred (provided that the aggregate principal amount of the total Indebtedness shall not exceed the purchase price or cost (including financing costs) of the properties financed thereby), (b) such properties were acquired (directly or indirectly, including through the purchase of Capital Stock of the Person owning such property), constructed or improved with the proceeds of such Indebtedness or such Indebtedness was incurred within 365 days after the acquisition (directly or indirectly, including through the purchase of Capital Stock of the Person owning such property) or completion of such construction or improvement and (c) no other assets of such Person may be realized upon in collection of principal or interest on such Indebtedness. Indebtedness which is otherwise Non-Recourse Indebtedness will not lose its character as Non-Recourse Indebtedness because there is recourse to the borrower, any guarantor or any other Person for (i) environmental warranties, covenants and indemnities, (ii) indemnities for and liabilities arising from fraud, misrepresentation, misapplication or non-payment of rents, profits, deposits, insurance and condemnation proceeds and other sums actually received by the borrower from secured assets to be paid to the lender, waste and mechanics’ liens, breach of separateness covenants, and other customary exceptions, (iii) in the case of the borrower thereof only, other obligations in respect of such Indebtedness that are payable solely as a result of a voluntary or collusive non-voluntary bankruptcy filing (or similar filing or action) by such borrower or (iv) similar customary “bad-boy” guarantees.
“Non-Recourse Indebtedness Amount” shall have the meaning specified in Section 6.03(b).
“Non-U.S. Lender” means a Lender that is not a U.S. Person.
“Note” means a Term Note.
“Obligations” means with respect to any Indebtedness, all obligations (whether in existence on the Closing Date or arising afterwards, absolute or contingent, direct or indirect) for or in respect of principal (when due, upon acceleration, upon redemption, upon mandatory repayment or repurchase pursuant to a mandatory offer to purchase, or otherwise), premium, interest, penalties, fees, indemnification, reimbursement and other amounts payable and liabilities with respect to such Indebtedness, including all interest accrued or accruing after the commencement of any bankruptcy, insolvency or reorganization or similar case or proceeding at the contract rate (including any contract rate applicable upon default) specified in the relevant documentation, whether or not the claim for such interest is allowed as a claim in such case or proceeding.
“OFAC” has the meaning specified in Section 5.11.
“Officer’s Certificate,” when used with respect to the Borrower or Holdings, means a certificate signed by the chairman of the Board of Directors, the president, chief executive officer, any vice president, the chief financial officer, the treasurer, any assistant treasurer, the controller, any assistant controller, the secretary or any assistant secretary of the Borrower or Holdings, as the case may be.
“Opinion of Counsel” means a written opinion signed by legal counsel of the Borrower or Holdings, who may be an employee of, or counsel to, the Borrower or Holdings, and who shall be reasonably satisfactory to the Administrative Agent.
“Other Connection Taxes” means, with respect to any Lender or Agent, Taxes imposed as a result of a present or former connection between such Lender or Agent and the jurisdiction imposing such Tax (other than connections arising from such Lender or Agent having executed, delivered, become a party to, performed its obligations under, received payments under, received or perfected a security interest under, engaged in any other transaction pursuant to or enforced any Loan Document, or sold or assigned an interest in any Loan or Loan Document).
“Other Prepayment Event” means the incurrence by the Borrower or any of its Restricted Subsidiaries of any Indebtedness, other than Indebtedness permitted under Section 6.03 (other than Refinancing Term Loans or any Refinancing Indebtedness which Refinances the Loans), or permitted by the Required Lenders pursuant to Section 9.01.
“Other Taxes” means all present or future stamp, court, or documentary, intangible, recording, filing or similar Taxes that arise from any payment made under, from the execution, delivery, performance, enforcement or registration of, from the receipt or perfection of a security interest under, or otherwise with respect to, any Loan Document, except any such Taxes that are Other Connection Taxes imposed with respect to an assignment (other than an assignment made pursuant to Section 3.07).
“Outstanding Amount” means, with respect to any Term Loans on any date of determination, the aggregate outstanding principal amount thereof on such date, after giving effect to any deemed incurrence, Borrowings, prepayments or repayments of Term Loans, as the case may be, occurring on such date.
“Participant” has the meaning specified in Section 9.07(e).
“Participant Register” has the meaning specified in Section 9.07(e).
“PATRIOT Act” means the Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001 (Title III of Pub. L. No. 107-56 (signed into Law October 26, 2001)).
“Pari Secured Debt Obligations” has the meaning ascribed to it in subclause (i)(f) of the definition of “Permitted Liens”.means any secured Indebtedness that has equal lien priority relative to the Liens securing the Loan Obligations pursuant to the terms of the First Lien Intercreditor Agreement, the Junior Lien Intercreditor Agreement or other intercreditor agreement that is substantially similar to such intercreditor agreements.
“Perfection Certificate” has the meaning set forth in the Security Agreement.
“Perfected Collateral” means the aggregate amount, at the time of determination, of:
(a) Cash Equivalents of Holdings, the Borrower and Restricted Subsidiaries to the extent the Liens thereon securing the Loan Obligations have been perfected pursuant to control agreements naming the Joint First Lien Collateral Agent as secured party;
(b) the book value (as of the last day of the Most Recent Fiscal Quarter) of any inventory constituting Collateral (to the extent the Liens securing such Collateral have been perfected), less the aggregate principal amount of any Non-Recourse Indebtedness, Refinancing Non-Recourse Indebtedness and Purchase Money Indebtedness (as of the last day of the Most Recent Fiscal Quarter) secured by Liens on such inventory that are senior or pari passu in priority with the Notes; and
the book value (as of the last day of the Most Recent Fiscal Quarter) of the Capital Stock in any JV Holding Company that is pledged as Collateral (to the extent the Liens securing such Collateral have been perfected).
“Permitted Bond Hedge” means any call or capped call option (or substantively equivalent derivative transaction) on Holdings’ Capital Stock purchased by Holdings, the Borrower or any Restricted Subsidiary in connection with the issuance of any Permitted Convertible Indebtedness; provided that the purchase price for such Permitted Bond Hedge, less the proceeds received by Holdings, the Borrower or the Restricted Subsidiaries from the sale of any related Permitted Warrant, does not exceed the net proceeds received by Holdings, the Borrower or the Restricted Subsidiaries from the sale of such Permitted Convertible Indebtedness issued in connection with the Permitted Bond Hedge.
“Permitted Convertible Indebtedness” means Indebtedness of Holdings, the Borrower or any Restricted Subsidiary permitted to be incurred under the terms of this Agreement that is either (a) convertible or exchangeable into Capital Stock of Holdings (and cash in lieu of fractional shares) and/or cash (in an amount determined by reference to the price of such Capital Stock) or (b) sold as units with call options, warrants or rights to purchase (or substantially equivalent derivative transactions) that are exercisable for Capital Stock of Holdings and/or cash (in an amount determined by reference to the price of such Capital Stock).
“Permitted Convertible Indebtedness Call Transaction” means any Permitted Bond Hedge and any Permitted Warrant.
“Permitted Hovnanian Holders” means, collectively, Ara K. Hovnanian, the members of his immediate family and the members of the immediate family of the late Kevork S. Hovnanian, the respective estates, spouses, heirs, ancestors, lineal descendants, legatees and legal representatives of any of the foregoing and the trustee of any bona fide trust of which one or more of the foregoing are the sole beneficiaries or the grantors thereof, or any entity of which any of the foregoing, individually or collectively, beneficially own more than 50% of the Common Equity. Any Person or group whose acquisition of beneficial ownership constitutes a Change of Control in respect of which a Change of Control Offer is made in accordance with the requirements of this Agreement (or would result in a Change of Control Offer in the absence of the waiver of such requirement by Lenders in accordance with this Agreement) will thereafter constitute Permitted Hovnanian Holders.
“Permitted Indebtedness” means:
(a) Indebtedness under:
(i) the Specified Credit Facility (and the guarantees thereof), in an aggregate amount outstanding at any one time and at the stated maturity thereof not to exceed $125.0 million,
(iii) (x) the 1.125Existing Senior Lien Notes Credit Facility (and the 1.125 Lien Gguarantees and (y) to the extent the 1.25 Lien Notes are no longer outstanding, Credit Facilities, in an aggregate principal amount outstanding at any one timethereof, which shall not include any guarantee by any Person that is not a Guarantor) and (y) any Specified Refinancing Indebtedness in respect thereof (including for the purposes of determining amounts outstanding under this clause (a)(iii), any Refinancing Indebtedness in respect of Indebtedness incurred or deemed incurred under this clause (a)(ii) (and any subsequently incurred Specified Refinancing Indebtedness with respect to Specified Refinancing Indebtedness included in this clause (a)(ii) i)) or Credit Facilities that otherwise meet the definition of Specified Replacement Facility, in an aggregate amount outstanding at any one time not to exceed $125.0 million; provided that, for purposes of determiningcalculating the amounts of Indebtedness deemed outstanding under this clause (a)(ii))) not to exceed $350.0 million (less any amounts of 1.125 Lien Notes repaid or repurchased pursuant to the mandatory prepayment provisions set forth in Sections 4.10 and 4.12 of the 1.125 Lien Indenture or similar provisions with respect to any (A)i), all amounts committed but not yet incurred under the Existing Senior Lien Credit Facility, any such Specified Refinancing Indebtedness in respect thereof or (B) any such Credit Facilities), (such amount, the “Undrawn Amount”) shall be deemed to have been incurred;
(iii) (x) the 1.25 Lien Notes and the 1.25 Lien Guarantees and (y) to the extent the 1.25 Lien Notes are no longer outstanding, Indebtedness incurred under any Credit Facilities, in an aggregate principal amount outstanding at any one time (including for the purposes of determining amounts outstanding under this clause (a)(iii), anythe 1.125 Lien Notes and the 1.125 Lien Guarantees thereof and any Specified Refinancing Indebtedness in respect of Indebtedness incurred or deemed incurred under this clause (a)(iii) (and any subsequently incurred Specified Refinancing Indebtedness with respect to Specified Refinancing Indebtedness included in this clause (a)(iii) for purposes of determining amounts outstanding under this clause (a)(iii))) not to exceed $282.4 million (less any amounts of 1.25 Lien Notes repaid or repurchased pursuant to the mandatory prepayment provisions set forth in Sections 4.10 and 4.12 of the 1.25 Lien Indenture or similar provisions with respect to any (A) Refinancing Indebtedness in respect thereof or (B) any such Credit Facilities),225.0 million (the “1.125 Lien Fixed Debt Cap”); provided that (x) any such Indebtedness incurred under this clause (a)(ii) after the Amendment No. 1 Effective Date that is not Specified Refinancing Indebtedness (the “New 1.125 Lien Basket Debt”) (A) shall mature no earlier than 91 days after the maturity date of the Loans, (B) shall have a Weighted Average Life to Maturity at the time such Indebtedness is incurred that is equal to or greater than the Weighted Average Life to Maturity of the Loans and (C) to the extent such Indebtedness is secured by any assets other than the Collateral, Liens on such assets shall be granted to the Collateral Agent for the benefit of the Secured Parties to secure the Loan Obligations and (y) the 1.125 Lien Fixed Debt Cap shall be subject to Section 6.03(k);
(iv) the 1.5 Lien Obligations and the 1.5 Lien Guaranteesiii) Indebtedness incurred under any Credit Facilities in an aggregate principal amount outstanding at any one time (including for the purposes of determining amounts outstanding under this clause (a)(iv), any iii), the 1.25 Lien Notes and the 1.25 Lien Guarantees thereof and any Specified Refinancing Indebtedness in respect of Indebtedness incurred or deemed incurred under this clause (a)(iviii) (and any subsequently incurred Specified Refinancing Indebtedness with respect to Specified Refinancing Indebtedness included in this clause (a)(iviii) for purposes of determining amounts outstanding under this clause (a)(iviii))) not to exceed (x) $168.0 million (less any amounts of 1.5 Lien Notes repaid or repurchased pursuant to Sections 4.10 and 4.12 of the 1.5 Lien Indenture, pursuant to the mandatory prepayment provisions similar to those set forth in Sections 4.10 and 4.12 of the 1.5 Lien Indenture, in the indenture(s) governing the 1.5 Lien Obligations or similar provisions with respect to any Refinancing Indebtedness in respect thereof);430.0 million (this clause (x), the “1.25 Lien Fixed Debt Cap”) plus (y) an aggregate principal amount of Side Letter Exchanged Indebtedness not to exceed $150.0 million; provided that (x) any such Indebtedness incurred under this clause (a)(iii) after the Amendment No. 1 Effective Date that is not Specified Refinancing Indebtedness or Side Letter Exchanged Indebtedness (the “New 1.25 Lien Basket Debt”) (A) shall mature no earlier than 91 days after the maturity date of the Loans, (B) shall have a Weighted Average Life to Maturity at the time such Indebtedness is incurred that is equal to or greater than the Weighted Average Life to Maturity of the Loans and (C) to the extent such Indebtedness is secured by any assets other than the Collateral, Liens on such assets shall be granted to the Collateral Agent for the benefit of the Secured Parties to secure the Loan Obligations and (y) the 1.25 Lien Fixed Debt Cap shall be subject to Section 6.03(k);
(b) [Rreserved];
(c) Indebtedness outstanding on the Closing Date, excluding Indebtedness constituting Permitted Indebtedness pursuant to clauses (a), (d) through (s), and (u) of this definition, which shall be deemed to be incurred pursuant to such clauses;
(d) Indebtedness in respect of obligations (other than obligations constituting debt for borrowed money) of Holdings and its Subsidiaries to the trustees under indentures for debt securities;
(e) intercompany debt obligations of (i) Holdings to the Borrower, (ii) the Borrower to Holdings, (iii) Holdings or the Borrower to any Subsidiary Guarantor and (iv) any Restricted Subsidiary to Holdings or the Borrower or any other Subsidiary Guarantor; provided, however, that any Indebtedness of any Subsidiary Guarantor or the Borrower or Holdings owed to any Subsidiary Guarantor or the Borrower that ceases to be a Subsidiary Guarantor shall be deemed to be incurred and shall be treated as an incurrence for purposes of Section 6.03 at the time the Subsidiary Guarantor in question ceases to be a Subsidiary Guarantor;
(f) Indebtedness of Holdings or the Borrower or any Subsidiary Guarantor under Hedging Obligations, in the case of any Currency Agreements or Interest Protection Agreements in a notional amount no greater than the payments due (at the time the related Currency Agreement or Interest Protection Agreement is entered into) with respect to the Indebtedness or currency being hedged, to the extent entered into in the ordinary course of business and not for speculative purposes;
(g) Purchase Money Indebtedness and Financing Lease Obligations entered into in the ordinary course of business in an aggregate principal amount (including for purposes of determining amounts outstanding under this clause (g), any Refinancing Indebtedness in respect thereof (and any subsequently incurred Refinancing Indebtedness with respect to Refinancing Indebtedness included in this clause (g) for purposes of determining amounts outstanding under this clause (g))) at any one time outstanding not to exceed $30.0 million;
(h) obligations for, pledge of assets in respect of, and guaranties of, bond financings of political subdivisions or enterprises thereof in the ordinary course of business;
(i) Indebtedness incurred under any Credit Facilities (including the Term Loans) in an aggregate principal amount outstanding under this clause (i) at any one time (including for the purposes of determining amounts outstanding under this clause (i), the 1.75 Lien NotesInitial Term Loans (and the gGuarantees thereof), any additional 1.75 Lien Notes (and guarantees thereof) and any Refinancing Indebtedness in respect of Indebtedness incurred or deemed incurred under this clause (i) (and any subsequently incurred Refinancing Indebtedness with respect to Refinancing Indebtedness included in this clause (i) for purposes of determining amounts outstanding under this clause (i))) not to exceed $240.0 million (less any amounts of 1.75 Lien Notes repaid or repurchased pursuant to Sections 4.10 and 4.12 of the 1.75 Lien Indenture and pursuant to similar mandatory prepayment provisions with respect to (A) any Refinancing Indebtedness or (B) any such Credit Facilities);175.0 million (the “1.75 Lien Fixed Debt Cap”); provided that, (x) any such Indebtedness incurred under this clause (i) after the Amendment No. 1 Effective Date that is not Refinancing Indebtedness (the “New 1.75 Lien Basket Debt”) (A) shall mature no earlier than 91 days after the maturity date of the Loans, (B) shall have a Weighted Average Life to Maturity at the time such Indebtedness is incurred that is equal to or greater than the Weighted Average Life to Maturity of the Loans and (C) to the extent such Indebtedness is secured by any assets other than the Collateral, Liens on such assets shall be granted to the Collateral Agent for the benefit of the Secured Parties to secure the Loan Obligations and (y) the 1.75 Lien Fixed Debt Cap shall be subject to Section 6.03(k);
(j) Indebtedness under warehouse lines of credit, repurchase agreements and Indebtedness secured only by mortgage loans and related assets of mortgage lending Subsidiaries in the ordinary course of a mortgage lending business;
(k) Indebtedness under (x) Existing Unsecured Indebtedness (and guarantees thereof) and (y) to the extent the Existing Unsecured Indebtedness is no longer outstanding,that satisfies the Required Debt Terms and is incurred under any Credit Facilities, in an aggregate principal amount outstanding at any one time (including for purposes of determining amounts outstanding under this clause (k), anythe Existing Unsecured Indebtedness (and the guarantees thereof, which shall not include any guarantee by a Person that is not a Guarantor) and any Refinancing Indebtedness in respect of Indebtedness incurred or deemed incurred under this clause (k) (and any subsequently incurred Refinancing Indebtedness with respect to Refinancing Indebtedness included in this clause (k) for purposes of determining amounts outstanding under this clause (k))) not to exceed $247.0 million; provided that, at the option of the Borrower, Indebtedness under this clause (k) in an aggregate principal amount up to the available Maturity/Weighted Average Life Excluded Amount may be incurred without regard to the Required Debt Terms;
(l) obligations in respect of self-insurance, performance, bid, appeal and surety bonds and completion guarantees and similar obligations provided by Holdings or any Restricted Subsidiary or obligations in respect of letters of credit, bank guarantees or similar instruments related thereto, in each case, in the ordinary course of business;
(m) [reserved];
(n) Indebtedness under (x) the Second Lien Obligations (and guarantees thereof) and (y) to the extent the Second Lien Obligations are no longer outstanding,that satisfies the Required Debt Terms and is incurred under any Credit Facilities, in an aggregate principal amount outstanding at any one time (including for purposes of determining amounts outstanding under this clause (n), any Refinancing Indebtedness in respect of Indebtedness incurred or deemed incurred under this clause (n) (and any subsequently incurred Refinancing Indebtedness with respect to Refinancing Indebtedness included in this clause (n) for purposes of determining amounts outstanding under this clause (n))) not to exceed $266.0 million;225.0 million; provided that, at the option of the Borrower, Indebtedness under this clause (n) in an aggregate principal amount up to the available Maturity/Weighted Average Life Excluded Amount may be incurred without regard to the Required Debt Terms;
(o) Indebtedness arising from the honoring by a bank or other financial institution of a check, draft or similar instrument drawn against insufficient funds in the ordinary course of business;
(p) Indebtedness of Holdings or any Restricted Subsidiary supported by a letter of credit (which letter of credit is incurred pursuant to another clause hereof (other than clause (l) of this definition)), in a principal amount not in excess of the stated amount of such letter of credit;
(q) Indebtedness of Holdings or any Restricted Subsidiary consisting of (i) the financing of insurance premiums or (ii) take or pay obligations contained in supply arrangements, in each case incurred in the ordinary course of business;
(r) Indebtedness of Holdings or any of its Restricted Subsidiaries in respect of Cash Management Services;
(s) obligations (other than Indebtedness for borrowed money) of Holdings or any of its Restricted Subsidiaries under an agreement with any governmental authority, quasi-governmental entity, utility, adjoining (or common master plan) landowner or seller of real property, in each case entered into in the ordinary course of business in connection with the acquisition of real property, to entitle, develop or construct infrastructure thereupon;
(t) the incurrence by Holdings or any Restricted Subsidiary of Indebtedness deemed to exist pursuant to the terms of a joint venture agreement as a result of a failure of Holdings or such Restricted Subsidiary to make a required capital contribution therein; provided that the only recourse on such Indebtedness is limited to Holdings’ or such Restricted Subsidiary’s equity interests in the related joint venture; and
(u) Indebtedness of Holdings, the Borrower or a Subsidiary Guarantor which, (i) satisfies the Required Debt Terms and (ii) together with all other Indebtedness under this clause (u), does not exceed $75.0 million aggregate principal amount outstanding at any one time (including for purposes of determining amounts outstanding under this clause (u), any Refinancing Indebtedness in respect thereof (or of such Refinancing Indebtedness), which Refinancing Indebtedness shall be deemed to have been incurred under this clause (u)).; provided that, at the option of the Borrower, Indebtedness under this clause (u) in an aggregate principal amount up to the available Maturity/Weighted Average Life Excluded Amount may be incurred without regard to the Required Debt Terms.
“Permitted Investment” means:
(a) Cash Equivalents;
(b) any Investment in Holdings, the Borrower or any Subsidiary Guarantor or any Person that becomes a Subsidiary Guarantor as a result of such Investment or that is consolidated or merged with or into, or transfers all or substantially all of the assets of it or an operating unit or line of business to, Holdings or a Subsidiary Guarantor;
(c) any receivables, loans or other consideration taken by Holdings, the Borrower or any Restricted Subsidiary in connection with any asset sale otherwise permitted by this Agreement; provided that non-cash consideration received in an Asset Disposition or an exchange or swap of assets shall be pledged as Collateral under the Collateral Documents to the extent the assets subject to such Asset Disposition or exchange or swap of assets constituted Collateral, with the Lien on such Collateral securing the Loans being of the same priority with respect to the Loans as the Lien on the assets disposed of; provided, further, that notwithstanding the foregoing clause, if such assets are not of a character that would be Collateral and Holdings is not able to obtain a Lien on such assets in favor of the Administrative Agent for the benefit of the Secured Parties after the use of reasonable efforts, up to an aggregate of $50.0 million of (i) non-cash consideration and consideration received as referred to in Section 6.07(b), (ii) assets invested pursuant to Section 2.03(a)(vi) and (iii) assets received pursuant to clause (d) under the definition of “Asset Disposition” may be designated by Holdings or the Borrower as Excluded Property not required to be pledged as Collateral;
(d) Investments received in connection with any bankruptcy or reorganization proceeding, or as a result of foreclosure, perfection or enforcement of any Lien or any judgment or settlement of any Person in exchange for or satisfaction of Indebtedness or other obligations or other property received from such Person, or for other liabilities or obligations of such Person created, in accordance with the terms of this Agreement;
(e) Investments in Hedging Obligations described in the definition of “Permitted Indebtedness”;
(f) any loan or advance to an executive officer, director or employee of Holdings or any Restricted Subsidiary made in the ordinary course of business or in accordance with past practice; provided, however, that any such loan or advance exceeding $1.0 million shall have been approved by the Board of Directors of Holdings or a committee thereof consisting of disinterested members;
(g) Investments in interests in issuances of collateralized mortgage obligations, mortgages, mortgage loan servicing, or other mortgage related assets;
(h) obligations of Holdings or a Restricted Subsidiary under warehouse lines of credit of Mortgage Subsidiaries to repurchase mortgages;
(i) Investments in an aggregate amount at any time outstanding not to exceed the greater of (i) $20.0 million and (ii) 1.4% of Consolidated Tangible Assets (measured at the time made and without giving effect to subsequent changes in value);
(j) Guarantees issued in accordance with Section 6.03;
(k) Investments in existence on the Closing Date (other than Restricted Payments described in Section 6.04(b)(xii)) not otherwise constituting Permitted Investments pursuant to clause (b) above;
(l) Permitted Bond Hedges which constitute Investments;
(m) extensions of trade credit and credit in connection with the sale of land owned by Holdings or a Restricted Subsidiary which is zoned by the applicable governmental authority having jurisdiction for construction and use as a detached or attached (including town homes or condominium) single-family house (but excluding mobile homes), or the sale of a detached or attached (including town homes or condominium) single-family house (but excluding mobile homes) owned by Holdings or a Restricted Subsidiary which is completed or for which there has been a start of construction and which has been or is being constructed on any such land;
(n) obligations (but not payments thereon) with respect to homeowners association obligations, community facility district bonds, metro district bonds, mello-roos bonds and subdivision improvement bonds and similar bonding requirements arising in the ordinary course of business of a homebuilder;
(o) guarantee obligations, including completion guarantee or indemnification obligations (other than for the payment of borrowed money) entered into in the ordinary course of business and incurred for the benefit of any adjoining landowner, lender, seller of real property or municipal government authority (or enterprises thereof) in connection with the acquisition, construction, subdivision, entitlement and development of real property;
(p) Investments the payment for which consists of Qualified Stock of Holdings; provided that such Qualified Stock will not increase the amount available for Restricted Payments under clause (iii) of Section 6.04(a);
(q) advances, loans or extensions of trade credit in the ordinary course of business by Holdings or any of the Restricted Subsidiaries;
(r) intercompany current liabilities owed by or to Unrestricted Subsidiaries or joint ventures incurred in the ordinary course of business in connection with the cash management operations of Holdings and its Subsidiaries in connection with the wind-up, roll-off and/or closure of any property described in clause (h) of the definition of “Excluded Property”; and
(s) insurance, lease, utility and workers’ compensation, performance and other similar deposits made in the ordinary course of business.
“Permitted Joint Venture” means any joint venture between the Borrower, Holdings or any of its Subsidiaries, on the one hand, and any other person that is not an affiliate of Holdings, on the other; provided that (i) such joint venture is solely engaged in the business of the development, construction and sale of homes and has no assets, liabilities or operations other than those reasonably related to such business, and (ii) such Person owns no Capital Stock or other equity interests in, or Indebtedness of, Holdings or any of its Restricted Subsidiaries and owns no Indebtedness (except in the case Holdings, any Applicable Debt that constitutes “capital markets” or bank lending Indebtedness) and makes no Investments in Holdings or any of its Restricted Subsidiaries.
“Permitted Liens” means
(a) Liens for taxes, assessments or governmental or quasi-governmental charges or claims that (i) are not yet delinquent for a period of more than 30 days, (ii) are being contested in good faith by appropriate proceedings and as to which appropriate reserves have been established or other provisions have been made in accordance with GAAP, if required, or (iii) encumber solely property abandoned or in the process of being abandoned;
(b) statutory Liens of landlords and carriers’, warehousemen’s, mechanics’, suppliers’, materialmen’s, repairmen’s or other Liens imposed by law and arising in the ordinary course of business and with respect to amounts that, to the extent applicable, either (i) are not yet delinquent for a period of more than 30 days or (ii) are being contested in good faith by appropriate proceedings and as to which appropriate reserves have been established or other provisions have been made in accordance with GAAP, if required;
(c) Liens (other than any Lien imposed by the Employer Retirement Income Security Act of 1974, as amended) incurred or deposits made in the ordinary course of business in connection with workers’ compensation, unemployment insurance and other types of social security or similar legislation or other insurance related obligations (including, but not limited to, in respect of deductibles, self-insured retention amounts and premiums and adjustments thereto) or indemnification obligations of (including obligations in respect of letters of credit or bank guarantees for the benefit of) insurance carriers providing property, casualty or liability insurance, or good faith deposits in connection with bids, tenders, contracts (other than for the payment of Indebtedness) or leases to which such Person is a party, or deposits to secure public or statutory obligations of such Person or deposits of cash or U.S. government bonds to secure surety, stay, customs or appeal bonds to which such Person is a party, or deposits as security for contested taxes or import duties or for the payment of rent, performance and return-of-money bonds and other similar obligations (including letters of credit issued in lieu of any such bonds or to support the issuance thereof and including those to secure health, safety and environmental obligations);
(d) Liens incurred or deposits made to secure the performance of tenders, bids, leases, statutory obligations, surety and appeal bonds, development obligations, progress payments, government contracts, utility services, developer’s or other obligations to make on-site or off-site improvements and other obligations of like nature (exclusive of obligations for the payment of borrowed money but including the items referred to in the parenthetical in clause (a)(i) of the definition of “Indebtedness”), in each case incurred in the ordinary course of business of Holdings, the Borrower and the Restricted Subsidiaries;
(e) attachment or judgment Liens not giving rise to a Default or an Event of Default;
(f) easements, dedications, assessment district or similar Liens in connection with municipal or special district financing, rights-of-way, restrictions, reservations and other similar charges, burdens, and other similar charges or encumbrances not materially interfering with the ordinary course of business of Holdings, the Borrower and the Restricted Subsidiaries;
(g) zoning restrictions, licenses, restrictions on the use of real property or minor irregularities in title thereto, which do not materially impair the use of such real property in the ordinary course of business of Holdings, the Borrower and the Restricted Subsidiaries;
(h) Liens securing Indebtedness incurred pursuant to clause (j) of the definition of “Permitted Indebtedness”;
(i) Liens on the Collateral securing:
(a) Indebtedness incurred or deemed incurred under clause (a)(i) of the definition of “Permitted Indebtedness”; provided that the Liens incurred pursuant to this clause (i)(a) may secure Senior Priority Lien Obligations;
(b) [Reserved];
(c) (i) Indebtedness incurred or deemed incurred under clause (a)(ii), (a)(iii) or (a)(iv) of the definition of “Permitted Indebtedness” and (ii) any Refinancing Indebtedness in respect thereof (and any subsequently incurred Refinancing Indebtedness in respect of any such Refinancing Indebtedness), provided that the Liens incurred pursuant to this clause (i)(c) may secure Senior Priority Lien Obligations;
(da) (i) Indebtedness incurred or deemed incurred under clauses (na)(i), (a)(ii) and (a)(iii) of the definition of “Permitted Indebtedness” and (ii) any Specified Refinancing Indebtedness in respect thereof (and any subsequently incurred Specified Refinancing Indebtedness in respect of any such Specified Refinancing Indebtedness),; provided that, at the option of the Borrower, such Liens incurred pursuant to this clause (i)(da) shall rank(1) constitute Senior Priority Lien Obligations or (2) rank equal to or junior to the Liens securing the 1.75 LienLoan Obligations pursuant to the terms of the First Lien Intercreditor Agreement, the Junior Lien Intercreditor Agreement or other intercreditor agreement that is substantially similar to such intercreditor agreements (in the case of any junior Liens, with the 1.75 LienLoan Obligations being treated as senior priority obligations thereunder), as applicable;
(eb) [Rreserved];
(fc) (i) Indebtedness incurred or deemed incurred under clause (i) of the definition of “Permitted Indebtedness”, including the 1.75 Lien Obligations, and (ii) any Refinancing Indebtedness in respect thereof (and any subsequently incurred Refinancing Indebtedness in respect of any such Refinancing Indebtedness) (Indebtedness so secured under clauses (f)(i) and (ii), collectively, the “Pari Secured Debt Obligations”),; provided that the Liens incurred pursuant to this clause (i)(fc) shall rank equal to or junior to the Liens securing the Loan Obligations pursuant to the terms of the First Lien Intercreditor Agreement, the Junior Lien Intercreditor Agreement or other intercreditor agreement that is substantially similar to such intercreditor agreements (in the case of any junior Liens, with the Loan Obligations being treated as senior priority obligations thereunder), as applicable; and
(gd) any other Indebtedness (including Refinancing Indebtedness or Specified Refinancing Indebtedness) permitted to be incurred under this Agreement in an aggregate amount at any time outstanding not to exceed $410.0325.0 million; provided that the Liens securing any such Indebtedness incurred pursuant to this clause (i)(gd) shall rank junior to the Liens on the Collateral securing the 1.75 LienLoan Obligations (or if no longer outstanding, the Refinancing Indebtedness in respect thereof (or of such Refinancing Indebtedness)) pursuant to the terms of the First Lien Intercreditor Agreement, the Junior Lien Intercreditor Agreement or other intercreditor agreement that is substantially similar to such intercreditor agreements (with the 1.75 LienLoan Obligations being treated as senior priority obligations thereunder), as applicable; and
(e) Incremental Term Loans and any Refinancing Indebtedness in respect thereof (and any subsequently incurred Refinancing Indebtedness in respect of such Refinancing Indebtedness); provided that the Liens incurred pursuant to this clause (i)(e) shall rank equal to or junior to the Liens securing the Loan Obligations pursuant to the terms of the First Lien Intercreditor Agreement, the Junior Lien Intercreditor Agreement or other intercreditor agreement that is substantially similar to such intercreditor agreements (in the case of any junior Liens, with the Loan Obligations being treated as senior priority obligations thereunder), as applicable;
(j) Liens securing Non-Recourse Indebtedness and Refinancing Non-Recourse Indebtedness of Holdings, the Borrower or any Restricted Subsidiary; provided, that such Liens apply only to (i) the property financed, constructed or improved out of the net proceeds of thesuch Non-Recourse Indebtedness within 365 days after the incurrence of the Non-Recourse Indebtedness, and, including for the avoidance of doubt, assets directly related thereto or derived therefrom or other property of Holdings, the Borrower or any Restricted Subsidiary financed pursuant to the Credit Facility of such person under which the Non-Recourse Indebtedness or Refinancing Non-Recourse Indebtedness was incurred, or (ii) licenses, permits, authorizations, consent forms or contracts related to the acquisition, development, use or improvement of such property; provided, that Holdings uses reasonable efforts to obtain Liens on the assets securing such Indebtedness, in favor of the Administrative Agent for the benefit of the Secured Parties, that is junior to the Liens securing such Indebtedness and otherwise consistent with priorities set forth in the First Lien Intercreditor Agreement;
(k) Liens securing Purchase Money Indebtedness (and any Refinancing Indebtedness in respect thereof); provided, that such Liens apply only to (i) the property financed, designed, installed, constructed, leased or improved with the proceeds of such Purchase Money Indebtedness within 365 days after the incurrence of such Purchase Money Indebtedness, and, including for the avoidance of doubt, assets directly related thereto or derived therefrom or other property of Holdings, the Borrower or any Restricted Subsidiary financed pursuant to the Credit Facility of such person under which the Purchase Money Indebtedness was incurred, or (ii) licenses, permits, authorizations, consent forms or contracts related to the acquisition, development, use or improvement of such property;
(l) Liens on property or assets of Holdings, the Borrower or any Subsidiary Guarantor securing Indebtedness of Holdings, the Borrower or any Subsidiary Guarantor owing to Holdings, the Borrower or one or more Subsidiary Guarantors;
(m) leases, subleases, licenses or sublicenses (including of intellectual property) granted to others not materially interfering with the ordinary course of business of Holdings and the Restricted Subsidiaries;
(n) Financing Lease Obligations; provided, that such Liens apply only to the Property acquired and the related Indebtedness is incurred within 365 days after the acquisition of such Property;
(o) any right of first refusal, right of first offer, option, contract or other agreement to sell an asset; provided that such sale is not otherwise prohibited under this Agreement;
(p) any right of a lender or lenders to which Holdings, the Borrower or a Restricted Subsidiary may be indebted to offset against, or appropriate and apply to the payment of such, Indebtedness and any and all balances, credits, deposits, accounts or money of Holdings, the Borrower or a Restricted Subsidiary with or held by such lender or lenders or its Affiliates;
(q) any pledge or deposit of cash or property in conjunction with obtaining surety, performance, completion or payment bonds and letters of credit or other similar instruments or providing earnest money obligations, escrows or similar purpose undertakings or indemnifications in the ordinary course of business of Holdings, the Borrower and the Restricted Subsidiaries;
(r) Liens for homeowner, condominium, property owner association developments and similar fees, assessments and other payments;
(s) Liens securing Refinancing Indebtedness (except Liens securing Refinancing Indebtedness in respect of Indebtedness secured pursuant to clauses (i) or (qq) under this definition); provided, that such Liens extend only to the assets securing the Indebtedness being refinanced and have the same or junior priority as the initial Liens;
(t) Liens incurred in the ordinary course of business as security for the obligations of Holdings, the Borrower and the Restricted Subsidiaries with respect to indemnification in respect of title insurance providers;
(u) Liens on property of a Person existing at the time such Person is merged with or into or consolidated with Holdings or any Subsidiary of Holdings or becomes a Subsidiary of Holdings; provided, that such Liens were in existence prior to the contemplation of such merger or consolidation or acquisition and do not extend to any assets other than those of the Person merged into or consolidated with Holdings or the Subsidiary or acquired by Holdings or its Subsidiaries;
(v) Liens on property existing at the time of acquisition thereof by Holdings or any Subsidiary of Holdings, provided, that such Liens were in existence prior to the contemplation of such acquisition;
(w) Liens existing on the Closing Date (other than Liens securing Obligations under Indebtedness secured pursuant to clause (i) under this definition) and any extensions, renewals, refinancings or replacements thereof;
(x) Liens on specific items of inventory or other goods and proceeds of any Person securing such Person’s obligations in respect of bankers’ acceptances issued or created for the account of such Person to facilitate the purchase, shipment or storage of such inventory or other goods;
(y) pledges, deposits and other Liens existing under, or required to be made in connection with, (i) earnest money obligations, escrows or similar purpose undertakings or indemnifications in connection with any purchase and sale agreement, (ii) development agreements or other contracts entered into with governmental authorities (or an entity sponsored by a governmental authority) in connection with the entitlement of real property or (iii) agreements for the funding of infrastructure, including in respect of the issuance of community facility district bonds, metro district bonds, subdivision improvement bonds and similar bonding requirements arising in the ordinary course of business of a homebuilder;
(z) Liens securing obligations of Holdings or any Restricted Subsidiary to any third party in connection with any option, repurchase right or right of first refusal to purchase real property granted to the master developer or the seller of real property that arises as a result of the non-use or non-development of such real property by Holdings or any Restricted Subsidiary and joint development agreements with third parties to perform and/or pay for or reimburse the costs of construction and/or development related to or benefiting property (and additions, accessions, improvements and replacements and customary deposits in connection therewith and proceeds and products therefrom) of Holdings or any Restricted Subsidiary and property belonging to such third parties, in each case entered into in the ordinary course of business; provided that such Liens do not at any time encumber any property, other than the property (and additions, accessions, improvements and replacements and customary deposits in connection therewith and proceeds and products therefrom) financed by such Indebtedness and the proceeds and products thereof;
(aa) Liens securing Hedging Obligations and Cash Management Services permitted to be incurred under this Agreement, so long as the related Indebtedness is, and is permitted under this Agreement to be, secured by a Lien on the same property securing such Hedging Obligations or Cash Management Services;
(bb) Liens arising from Uniform Commercial Code (or equivalent statute) financing statement filings regarding operating leases or consignments entered into by Holdings or any Restricted Subsidiary in the ordinary course of business;
(cc) Liens in favor of the Borrower or any other Loan Party;
(dd) deposits made or other security provided to secure liabilities to insurance carriers under insurance or self-insurance arrangements in the ordinary course of business;
(ee) Liens in favor of customs and revenue authorities arising as a matter of law to secure payment of customs duties in connection with the importation of goods in the ordinary course of business;
(ff) Liens (i) of a collection bank arising under Section 4-210 of the Uniform Commercial Code or any comparable or successor provision on items in the course of collection, and (ii) in favor of banking or other financial institutions or electronic payment service providers arising as a matter of law encumbering deposits (including the right of set-off) and which are within the general parameters customary in the banking or finance industry;
(gg) the rights reserved or vested in any Person by the terms of any lease, license, grant or permit held by Holdings or any of its Restricted Subsidiaries or by a statutory provision, to terminate any such lease, license, grant or permit, or to require annual or periodic payments as a condition to the continuance thereof;
(hh) restrictive covenants affecting the use to which real property may be put; provided that the covenants are complied with;
(ii) security given to a public utility or any municipality or governmental authority when required by such utility or authority in connection with the operations of that Person in the ordinary course of business;
(jj) zoning by-laws and other land use restrictions, including, without limitation, site plan agreements, development agreements and contract zoning agreements;
(kk) Liens arising out of conditional sale, title retention, consignment or similar arrangements for sale of goods entered into by Holdings or any Restricted Subsidiary in the ordinary course of business;
(ll) Liens on the equity interests of a Mortgage Subsidiary securing Indebtedness of the type set forth under clause (j) of the definition of “Permitted Indebtedness”;
(mm) [Reserved];
(nn) any encumbrance or restriction (including put and call arrangements) with respect to capital stock of any joint venture or similar arrangement pursuant to any joint venture or similar agreement, to the extent that such encumbrance or restriction does not secure Indebtedness;
(oo) Liens on property or assets used to defease or to irrevocably satisfy and discharge Indebtedness; provided that such defeasance or satisfaction and discharge is not prohibited by this Agreement;
(pp) easements, rights-of-way, dedications, covenants, conditions, restrictions, reservations and assessment district or similar Liens in connection with municipal or special district financing, agreements with adjoining landowners or state or local government authorities, quasi-governmental entities or utilities and other similar charges or encumbrances incurred in the ordinary course of business and which do not, in the aggregate, materially interfere with the ordinary course of business of Holdings and its Subsidiaries; and
(qq) Liens securing obligations not to exceed $25.0 million at any one time outstanding; provided that any Liens on the Collateral securing any Indebtedness (or Obligations in respect thereof) incurred pursuant to this clause (qq) shall rank junior to the Liens securing the 1.75 LienLoan Obligations pursuant to the terms of the First Lien Intercreditor Agreement, the Junior Lien Intercreditor Agreement or other intercreditor agreement that is substantially similar to such intercreditor agreements (with the 1.75 LienLoan Obligations being treated as senior priority obligations thereunder), as applicable.
For purposes of determining compliance with this definition of “Permitted Liens”, (x) a Lien need not be incurred solely by reference to one category of Permitted Liens described in this definition but may be incurred under any combination of such categories (including in part under one such category and in part under any other such category) and (y) in the event that a Lien (or any portion thereof) meets the criteria of one or more of such categories of Permitted Liens, the Borrower shall, in its sole discretion, classify or reclassify such Lien (or any portion thereof) in any manner that complies with this definition.
“Permitted Warrant” means any call option on, warrant or right to purchase (or substantively equivalent derivative transaction) Holdings’ Capital Stock sold by Holdings, the Borrower or any Restricted Subsidiary substantially concurrently with any purchase by Holdings, the Borrower or any Restricted Subsidiary of a related Permitted Bond Hedge.
“Person” means any individual, corporation, partnership, limited liability company, joint venture, incorporated or unincorporated association, joint stock company, trust, unincorporated organization or government or any agency or political subdivision thereof.
“Pledge” has the meaning specified in Section 9.07(i).
“Pledge Agreement” means the 1.75 Lien Pledge Agreement among the Borrower, the other Grantors named therein and Wilmington Trust, National Association in its capacities as the 1.75 Pari Passu Lien Collateral Agent and the Joint First Lien Collateral Agent, dated as of the Closing Date, which shall be substantially in the form of Exhibit J-2.
“Pledgee” has the meaning specified in Section 9.07(i).
“Pledging Lender” has the meaning specified in Section 9.07(i).
“Preferred Stock” of any Person means all Capital Stock of such Person which has a preference in liquidation or with respect to the payment of dividends.
“Prepay”, “Prepaid” and “Prepayment” have the meanings specified in Section 6.20 hereof.
“Prepayment Builder Amount” means, immediately before consummating a Prepayment under Section 6.20(a)(ivv), an amount equal to (x) the sum of (a) $24.0 million and (b) 30% of the increase in Perfected Collateral from and including (taken as one accounting period) November 1, 2019 and ending on the last day of Holdings’ fiscal quarter immediately preceding the date of such Prepayment minus (y) the aggregate amount of Prepayments made pursuant to Section 6.20(a)(ivv) since October 31, 2019.
“Prepayment Indebtedness” has the meaning specified in Section 6.20 hereof.
“Prepayment Notice” has the meaning specified in Section 2.03(a)(i), which shall be substantially in the form of Exhibit A-2.
“Prepayment Premium” means, with respect to the payment or repayment of any Loan pursuant to Section 2.03 or Section 2.14, (a) prior to November 15, 2021, an amount equal to the Make-Whole Premium, (b) on or after November 15, 2021 and prior to November 15, 2022, an amount equal to the principal amount of the Loans prepaid or repaid multiplied by 5.00% (b) on or after November 15, 2022 and prior to November 15, 2023, an amount equal to the principal amount of the Loans prepaid or repaid multiplied by 2.50% and (c) on or after November 15, 2023, 0.00%.
“Pro Rata Share” means, with respect to each Lender at any time, a fraction (expressed as a percentage, carried out to the ninth decimal place), the numerator of which is the amount of the Term Commitments of such Lender under the applicable Facility or Facilities or the Outstanding Amount of such Lender’s Term Loans under such Facility at such time and the denominator of which is the amount of the Aggregate Commitments under the applicable Facility or Facilities or the aggregate Outstanding Amount of all Term Loans under such Facility at such time.
“Property” of any Person means all types of real, personal, tangible, intangible or mixed property owned by such Person, whether or not included in the most recent consolidated balance sheet of such Person and its Subsidiaries under GAAP.
“Public Filings” means Holding’s annual report on Form 10-K for the fiscal year ended October 31, 20182023, each subsequently filed quarterly report on Form 10-Q and current report on Form 8-K (other than Items 2.02 and 7.01) and all other documents filed by Holdings with the Securities and Exchange Commission since November 1, 20182023 under Section 13(a), 13(c), 14 and 15(d) of the Exchange Act on or prior to the ClosingAmendment No. 1 Effective Date (other than Items 2.02 and 7.01 of a Form 8-K).
“Purchase Money Indebtedness” means Indebtedness of Holdings, the Borrower or any Restricted Subsidiary incurred for the purpose of financing all or any part of the purchase price, or the cost of design, installation, construction, lease or improvement, of any property to be used in the business of Holdings, the Borrower and the Restricted Subsidiaries; provided, however, that (a) the aggregate principal amount of such Indebtedness shall not exceed such purchase price or cost (including financing costs) and (b) such Indebtedness shall be incurred no later than 365 days after the acquisition of such property or completion of such design, installation, construction, lease or improvement.
“Purchasing Borrower Party” means Holdings or any subsidiary of Holdings.
“Qualified Stock” means Capital Stock of Holdings other than Disqualified Stock.
“Rating Agency” means a statistical rating agency or agencies, as the case may be, nationally recognized in the United States and selected by Holdings (as certified by a resolution of the Board of Directors of Holdings) which shall be substituted for S&P or Moody’s, or both, as the case may be.
“Real Estate Business” means homebuilding, housing construction, real estate development or construction and the sale of homes and related real estate activities, including the provision of mortgage financing or title insurance.
“Refinance” has the meaning specified in Section 2.14.
“Refinancing Effective Date” has the meaning specified in Section 2.14.
“Refinancing Indebtedness” means Indebtedness (to the extent not Permitted Indebtedness) that refunds, refinances or extends any Indebtedness of Holdings, the Borrower or any Restricted Subsidiary (excluding Non-Recourse Indebtedness or Permitted Indebtedness described under clauses (dc), (eg), (fi), (hk), (jn), (l), and (o) through (tu) of the definition thereof)of “Permitted Indebtedness” or under Sections 6.03(a), 6.03(b)(i), 6.03(b)(ii) and 6.03(b)(v), but only to the extent that:
(a) the Refinancing Indebtedness is subordinated, if at all, to the Loans or the Guarantees, as the case may be, to the same extent as the Indebtedness being refunded, refinanced or extended;
(b) the Refinancing Indebtedness is scheduled to mature either (x) other than in the case of the Existing 13.5% Unsecured Notes, no earlier than the Indebtedness being refunded, refinanced or extended or (y) no earlier than 91 days after the maturity date of the Loans;
(c) the portion, if any, of the Refinancing Indebtedness that is scheduled to mature on or prior to the maturity date of the Loans has a Weighted Average Life to Maturity at the time such Refinancing Indebtedness is incurred that is equal to or greater than the Weighted Average Life to Maturity of the portion of the Indebtedness being refunded, refinanced or extended that is scheduled to mature on or prior to the maturity date of the Loans;
(d) such Refinancing Indebtedness is in an aggregate principal amount that is equal to or less than the aggregate principal amount then outstanding under the Indebtedness being refunded, refinanced or extended (plus all accrued interest thereon and the amount of any premiums (including tender premiums) and fees, costs and expenses incurred in connection with the refinancing thereof);
(e) such Refinancing Indebtedness, if secured, is (x) secured only by Permitted Liens (other than Liens permitted solely under clause (s) of the definition of “Permitted Liens”) at the time of such refinancing, refunding or replacementextension (it being understood that secured Indebtedness may be refinanced with unsecured Indebtedness and unsecured Indebtedness may be refinanced with secured Indebtedness) and (y) to the extent the Refinancing Indebtedness being refunded, refinanced or extended was notis secured by any assets other than the Collateral, such Refinancing Indebtedness is not secured by any assets other than the Collateral; andLiens on such assets shall be granted to the Collateral Agent for the benefit of the Secured Parties to secure the Loan Obligations with such priorities as required pursuant to the definition of “Permitted Liens”; and
(f) such Refinancing Indebtedness may not be incurred or guaranteed by any Person that is not the Borrower or a Guarantor hereunder unless such Person becomes a Guarantor hereunder;
provided, that for purposes of determining the principal amount outstanding under clauses (a), (g), (i), (k), (n) and (u) of the definition of “Permitted Indebtedness” and(including, for the avoidance of doubt, the 1.75 Lien Fixed Debt Cap and the Senior/Pari Passu Priority Lien Fixed Debt Cap), clauses (i)(b), (i)(c), (i)(d), (k) and (qq) of “Permitted Liens” and Section 6.03(k), the principal amount referred to in such clauses shall be calculated excluding any principal amount that was incurred in respect of amounts set forth in the parenthetical in clause (d) of this definition and such principal amount shall nonetheless be permitted under such clauses.
“Refinancing Term Lender” has the meaning specified in Section 2.14(b).
“Refinancing Term Loan Amendment” has the meaning specified in Section 2.14(c).
“Refinancing Term Loan Facility” means a facility providing for the Borrowing of Refinancing Term Loans.
“Refinancing Term Loan Series” has the meaning specified in Section 2.14(b).
“Refinancing Term Loans” has the meaning specified in Section 2.14(a).
“Refinancing Non-Recourse Indebtedness” has the meaning specified in Section 6.03(b).
“Register” has the meaning specified in Section 9.07(c).
“Related Indemnitee” has the meaning specified in Section 9.05.
“Related Parties” means, with respect to any Person, such Person’s Affiliates and the partners, directors, officers, employees, agents and advisors of such Person and of such Person’s Affiliates.
“Release” means any release, spill, emission, discharge, deposit, disposal, leaking, pumping, pouring, dumping, emptying, injection or leaching into the environment, or into, from or through any structure or facility.
“repayment” has the meaning specified in the definition of “Consolidated Fixed Charge Coverage Ratio”.
“Required Debt Terms” means the applicable Indebtedness complies with the following:
(a) such Indebtedness is scheduled to mature no earlier than 91 days after the maturity date of the Loans;
(b) such Indebtedness has a Weighted Average Life to Maturity at the time such Indebtedness is incurred that is equal to or greater than the Weighted Average Life to Maturity of the Loans; and
(c) such Indebtedness may not be incurred or guaranteed by any Person that is not a Borrower or a Guarantor hereunder unless such Person becomes a Guarantor hereunder.
“Required Lenders” means, as of any date of determination, Lenders having more than 50% of the Aggregate Exposure of all Lenders on such date; provided, that the Aggregate Exposure of any Defaulting Lender shall be excluded for purposes of making a determination of Required Lenders.
“Required Payment Date” has the meaning specified in Section 2.03(a)(iv).
“Required Prepayment Amount” has the meaning specified in Section 2.03(a)(iv).
“Reserved Indebtedness Amount” has the meaning specified in Section 6.03(i).
“Resolution Authority” means an EEA Resolution Authority or, with respect to any UK Financial Institution, a UK Resolution Authority.
“Responsible Officer” means the chief executive officer, president, executive vice president, vice president, chief financial officer, chief accounting officer, treasurer, assistant treasurer, controller or other similar officer of a Loan Party or, in the case of any foreign Subsidiary, any duly appointed authorized signatory or any director or managing member of such Person and, as to any document delivered on the Closing Date, any secretary or assistant secretary. Any document delivered hereunder that is signed by a Responsible Officer of a Loan Party shall be conclusively presumed to have been authorized by all necessary corporate, partnership and/or other action on the part of such Loan Party, and such Responsible Officer shall be conclusively presumed to have acted on behalf of such Loan Party. With respect to the Administrative Agent, “Responsible Officer” shall mean any officer, including any vice president, assistant vice president, trust officer or any other officer of the Administrative Agent customarily performing functions similar to those performed by any of the above designated officers, and also, with respect to a particular matter, any other officer to whom such matter is referred because of such officer’s knowledge of and familiarity with the particular subject, in each case, having direct responsibility for the administration of this Agreement.
“Restricted Investment” means any Investment other than a Permitted Investment.