Exhibit 10.1
WAIVER AND CONSENT
THIS WAIVER AND CONSENT, dated as of October 31, 2005 (this "Waiver
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and Consent"), by and among Solutia Inc., a Delaware corporation (the
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"Parent"), and Solutia Business Enterprises, Inc., a New York corporation,
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("Solutia Business" and together with the Parent, each a "Borrower" and
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collectively, the "Borrowers"), each subsidiary of the Parent listed as a
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"Guarantor" on the signature pages hereto, (each a "Guarantor" and
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collectively, the "Guarantors"), the lenders from time to time party hereto
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(each a "Lender" and collectively, the "Lenders"), the issuers from time to
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time party hereto (each an "Issuer" and collectively, the "Issuers"),
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Citicorp USA, Inc. ("CUSA"), as collateral agent for the Lenders (in such
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capacity, the "Collateral Agent"), CUSA, as administrative agent for the
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Lenders (in such capacity, the "Administrative Agent"), and CUSA and Wells
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Fargo Foothill, LLC, as co-documentation agents for the Lenders, (in such
capacity, the "Documentation Agent" and together with the Collateral Agent
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and the Administrative Agent, each an "Agent" and collectively, the
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"Agents").
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RECITALS:
WHEREAS, the Borrowers, the Guarantors, the Lenders, the Issuers,
and the Agents have heretofore entered into that certain Financing
Agreement, dated as of January 16, 2004, (as amended, supplemented, or
otherwise modified from time to time, the "Financing Agreement");
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WHEREAS, Parent has notified the Agents that Astaris expects to
sell all or substantially all its operating assets to Israeli Chemicals
Limited, or certain of its affiliates, that such sale is expected to close
on or about October 31, 2005, and that Astaris will subsequently distribute
the net proceeds of that sale to its members, including Parent, as set forth
in the agreements relating to the sale;
WHEREAS, Parent has determined that it is in its best interest to
retain the proceeds of such sale (whether received at closing or thereafter
and whether received directly or as a distribution from Astaris, the
"Astaris Sale Proceeds") and has requested that the Lenders waive any
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provisions of the Loan Documents that would otherwise require the any Loan
Party to make a prepayment upon receipt of the Astaris Sale Proceeds or
require that the Astaris Sale Proceeds be held as additional collateral by
the Collateral Agent; and
WHEREAS, the Lenders are willing to grant such waiver on the terms
and conditions set forth herein.
NOW, THEREFORE, in consideration of the premises set forth above,
the terms and conditions contained herein and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged,
the parties hereto agree as follows:
ARTICLE I
DEFINITIONS
Section 1.01 Definitions. Unless otherwise defined or the context
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otherwise requires, terms for which meanings are provided in the Financing
Agreement shall have such meanings when used in this Waiver and Consent
(including, without limitation, in the foregoing recitals).
ARTICLE II
WAIVER AND CONSENT
Section 2.01 Waiver and Consent. Upon the terms and subject to the
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conditions set forth herein, each of the Lenders hereby agrees that,
notwithstanding any provision of the Financing Agreement or any other Loan
Document (including, without limitation, Sections 2.05(c) and (d) of the
Financing Agreement and Section 7 of the Pledge Agreement (DIP)), Parent
shall be entitled to retain 100% of the Astaris Sale Proceeds and waives any
provisions of the Loan Documents that would otherwise require a different
application or treatment of the Astaris Sale Proceeds. Furthermore, each
Lender hereby agrees that the Astaris Sale Proceeds shall be disregarded for
purposes of calculating whether the Borrowers have received $17,500,000 of
Net Cash Proceeds from events described in clauses (iii), (iv), or (vii) of
Section 2.05(c).
ARTICLE III
CONDITIONS PRECEDENT
Section 3.01 Conditions to Effectiveness of this Waiver and
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Consent. This Waiver and Consent shall be effective as of the date hereof,
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upon the satisfaction of the conditions precedent that:
(a) Executed Counterparts. The Administrative Agent shall
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have received executed counterparts of this Waiver and Consent, duly
executed by a sufficient number of Lenders to evidence Supermajority
Consent, each Loan Party, the Administrative Agent, and the Collateral
Agent.
(b) No Default. As of the date hereof, both before and
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after giving effect to this Waiver and Consent, no Default or Event of
Default shall have occurred and be continuing (and by its execution hereof,
the Borrowers shall be deemed to have represented and warranted such).
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ARTICLE IV
REPRESENTATIONS AND WARRANTIES
Section 4.01 Enforceability. Each of the Loan Parties represents
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and warrants to each of the Agents, each of the Lenders, and each of the
Issuers that this Waiver and Consent has been duly and validly executed and
delivered by each of the Loan Parties and constitutes legal, valid and
binding obligations of each of the Loan Parties, enforceable in accordance
with the terms hereof except as such enforceability may be limited by
applicable bankruptcy, insolvency, reorganization, or other similar laws
affecting creditors' rights generally, and by general principles of equity
(regardless of whether such enforceability is considered in a proceeding in
equity or at law).
ARTICLE V
COVENANTS OF THE LOAN PARTIES
Section 5.01 Bankruptcy Court Order. The Loan Parties will use
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commercially reasonable efforts to obtain, on or before December 31, 2005
(as such date may be extended with the written approval of the
Administrative Agent in its sole discretion), an order of the Bankruptcy
Court, in form and substance satisfactory to the Administrative Agent in its
sole discretion, approving matters related hereto, which order shall have
been entered by the Bankruptcy Court on or before such date; provided, that
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if the Loan Parties are unable after use of commercially reasonable efforts
to comply with the foregoing, the Borrowers will instead immediately make
such payments as would otherwise have been required under the Loan Documents
without regard to this Waiver and Consent. The Borrowers shall promptly
provide to the Administrative Agent a true and complete copy of such order,
and such order shall remain in full force and effect and shall not be
reversed, modified, amended, stayed or vacated absent prior written consent
of the Administrative Agent.
ARTICLE VI
MISCELLANEOUS
Section 6.01 Effect; Ratification. The waivers and consents set
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forth herein are effective solely for the purposes set forth herein and
shall be limited precisely as written, and shall not be deemed to (i) be a
consent to, or acknowledgment of, any amendment, waiver or modification of
any other term or condition of the Financing Agreement or of any other
instrument or agreement referred to therein or (ii) prejudice any right or
remedy which the Agents or any other party may now have or may have in the
future under or in connection with the Financing Agreement as amended hereby
or any other instrument or agreement referred to therein. This Waiver and
Consent shall be
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construed in connection with and as part of the Financing Agreement, and all
terms, conditions, representations, warranties, covenants and agreements set
forth in the Financing Agreement and each other instrument or agreement
referred to therein, except as herein amended, are hereby ratified and
confirmed and shall remain in full force and effect.
Section 6.02 No Novation. Neither this Waiver and Consent nor the
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replacement of the terms of the Financing Agreement by the terms of this
Waiver and Consent shall extinguish the obligations for the payment of money
outstanding under the Financing Agreement or discharge or release the Lien
or priority of any security agreement, any pledge agreement or any other
security therefor. Nothing herein contained shall be construed as a
substitution or novation of the Obligations outstanding under the Financing
Agreement or instruments securing the same, which shall remain in full force
and effect, except as modified hereby. Nothing expressed or implied in this
Waiver and Consent or any other document contemplated hereby or thereby
shall be construed as a release or other discharge of the Borrowers or any
other Loan Party under any Loan Document from any of its obligations and
liabilities thereunder. Each of the Financing Agreement and the other Loan
Documents shall remain in full force and effect, until and except as
modified hereby or in connection herewith. This Waiver and Consent is a Loan
Document executed pursuant to the Financing Agreement and shall be
construed, administered and applied in accordance with the terms and
provisions thereof.
Section 6.03 Costs, Fees and Expenses. The Borrowers jointly and
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severally agree to reimburse the Agents and the Lenders upon demand in
accordance with Section 13.04 of the Financing Agreement for all reasonable
costs, fees and expenses (including the reasonable fees and expenses of
counsel to the Agents and the Lenders) incurred in connection with the
preparation, execution and delivery of this Waiver and Consent.
Section 6.04 Counterparts. This Waiver and Consent may be executed
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in any number of counterparts and by different parties hereto in separate
counterparts, each of which shall be deemed to be an original, but all of
which taken together shall constitute one and the same agreement. Delivery
of an executed counterpart of this Waiver and Consent by telecopier shall be
equally as effective as delivery of an original executed counterpart of this
Waiver and Consent. Any party delivering an executed counterpart of this
Waiver and Consent by telecopier also shall deliver an original executed
counterpart of this Waiver and Consent but the failure to deliver an
original executed counterpart shall not affect the validity, enforceability,
and binding effect of this Waiver and Consent.
Section 6.05 Severability. Any provision of this Waiver and Consent
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which is prohibited or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining portions hereof or
affecting the validity or enforceability of such provision in any other
jurisdiction.
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Section 6.06 CHOICE OF LAW. THIS WAIVER AND CONSENT SHALL BE
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GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW
YORK APPLICABLE TO CONTRACTS MADE AND TO BE PERFORMED IN THE STATE OF NEW
YORK EXCEPT AS GOVERNED BY THE BANKRUPTCY CODE.
Section 6.07 No Party Deemed Drafter. Each of the parties hereto
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agrees that no party hereto shall be deemed to be the drafter of this Waiver
and Consent.
Section 6.08 Ratification of Guaranty. Each Guarantor hereby
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consents to this Waiver and Consent and hereby confirms and agrees that (a)
notwithstanding the effectiveness of this Waiver and Consent, the Guaranty
is, and shall continue to be, in full force and effect and is hereby
ratified and confirmed in all respects, and (b) the Loan Documents to which
it is a party and all of the Collateral described therein do, and shall
continue to, secure the payment of all of the Obligations secured thereby.
(Signature Page Follows)
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IN WITNESS WHEREOF, the parties hereto have caused this
Waiver and Consent to be executed by their respective officers thereunto
duly authorized, as of the date first above written.
BORROWERS:
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SOLUTIA INC.
By: /s/ James A. Tichenor
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Name: James A. Tichenor
Title: Assistant Treasurer
SOLUTIA BUSINESS ENTERPRISES, INC.
By: /s/ James A. Tichenor
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Name: James A. Tichenor
Title: Vice President & Treasurer
GUARANTORS:
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AXIO RESEARCH CORPORATION
By: /s/ James A. Tichenor
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Name: James A. Tichenor
Title: Vice President & Treasurer
BEAMER ROAD MANAGEMENT COMPANY
By: /s/ James A. Tichenor
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Name: James A. Tichenor
Title: Vice President & Treasurer
CPFILMS INC.
By: /s/ James A. Tichenor
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Name: James A. Tichenor
Title: Vice President & Assistant Treasurer
MONCHEM, INC.
By: /s/ James A. Tichenor
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Name: James A. Tichenor
Title: Vice President & Treasurer
MONCHEM INTERNATIONAL, INC.
By: /s/ James A. Tichenor
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Name: James A. Tichenor
Title: Vice President & Treasurer
SOLUTIA GREATER CHINA, INC.
By: /s/ James A. Tichenor
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Name: James A. Tichenor
Title: Vice President & Treasurer
SOLUTIA INTER-AMERICA, INC.
By: /s/ James A. Tichenor
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Name: James A. Tichenor
Title: Vice President & Treasurer
SOLUTIA INTERNATIONAL HOLDING
By: /s/ James A. Tichenor
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Name: James A. Tichenor
Title: Vice President & Treasurer
SOLUTIA INVESTMENTS, LLC
By: /s/ James A. Tichenor
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Name: James A. Tichenor
Title: Vice President & Treasurer
SOLUTIA MANAGEMENT COMPANY, INC.
By: /s/ James A. Tichenor
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Name: James A. Tichenor
Title: Vice President & Treasurer
SOLUTIA OVERSEAS, INC.
By: /s/ James A. Tichenor
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Name: James A. Tichenor
Title: Vice President & Treasurer
SOLUTIA SYSTEMS, INC.
By: /s/ James A. Tichenor
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Name: James A. Tichenor
Title: Vice President & Treasurer
SOLUTIA TAIWAN, INC.
By: /s/ James A. Tichenor
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Name: James A. Tichenor
Title: Vice President & Treasurer
ADMINISTRATIVE AGENT,
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COLLATERAL AGENT, CO-
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DOCUMENTATION AGENT AND A
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LENDER:
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CITICORP USA, INC., for itself as the
Administrative Agent, the Collateral Agent,
a Co-Documentation Agent and a Lender
By: /s/ David Jaffe
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Name: DAVID JAFFE
Title: DIRECTOR/VICE PRESIDENT
ISSUER:
CITIBANK, N.A., as an Issuer and a Lender
By: /s/ David Jaffe
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Name: DAVID JAFFE
Title: DIRECTOR/VICE PRESIDENT
CO-DOCUMENTATION AGENT AND A
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LENDER:
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WELLS FARGO FOOTHILL, LLC, for itself as a
Co-Documentation Agent and a Lender
By: /s/ Yelena Kravchuk
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Name: Yelena Kravchuk
Title: AVP
CELERITY CLO LIMITED
By: TCW Advisors, Inc., as Agent
By: /s/ Wayne Hosang
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Title: G. WAYNE HOSANG
VICE PRESIDENT
By: /s/ Vikas Mavinkurve
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Title: VIKAS MAVINKURVE
VICE PRESIDENT
C-SQUARED CDO LTD.
By: TCW Advisors, Inc., as its
Portfolio Manager
By: /s/ Wayne Hosang
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Title: G. WAYNE HOSANG
VICE PRESIDENT
By: /s/ Vikas Mavinkurve
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Title: VIKAS MAVINKURVE
VICE PRESIDENT
LOAN FUNDING I LLC,
a wholly owned subsidiary of Citibank,
N.A.
By: TCW Advisors, Inc.,
as Portfolio Manager of Loan Funding I LLC
By: /s/ Wayne Hosang
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Title: G. WAYNE HOSANG
VICE PRESIDENT
By: /s/ Vikas Mavinkurve
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Title: VIKAS MAVINKURVE
VICE PRESIDENT
TCW SELECT LOAN FUND, LIMITED
By: TCW Advisors, Inc., as its
Collateral Manager
By: /s/ Wayne Hosang
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Title: G. WAYNE HOSANG
VICE PRESIDENT
By: /s/ Vikas Mavinkurve
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Title: VIKAS MAVINKURVE
VICE PRESIDENT
TCW SENIOR SECURED LOAN FUND
By: TCW Advisors, Inc., as its
Investment Advisor
By: /s/ Wayne Hosang
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Title: G. WAYNE HOSANG
VICE PRESIDENT
By: /s/ Vikas Mavinkurve
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Title: VIKAS MAVINKURVE
VICE PRESIDENT
VELOCITY CLO, LTD.
By: TCW Advisors, Inc.,
its Collateral Manager
By: /s/ Wayne Hosang
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Title: G. WAYNE HOSANG
VICE PRESIDENT
By: /s/ Vikas Mavinkurve
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Title: VIKAS MAVINKURVE
VICE PRESIDENT
LENDER:
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Citigroup Financial Products Inc.
as a Lender
By: /s/ Jeffrey Jacob
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Name: JEFFREY JACOB
Title: MD
LENDER:
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Highland Legacy Limited
By: Highland Capital Management, L.P., As
Collateral Manager
By: Strand Advisors, Inc., Its General
Partner
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as a Lender
By: /s/ Chad Schramek
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Name:
Title:
Chad Schramek, Assistant Treasurer
Strand Advisors, Inc., General Partner of
Highland Capital Management, L.P.
LENDER:
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Restoration Funding CLO, LTD
By: Highland Capital Management, L.P., As
Collateral Manager
By: Strand Advisors, Inc., Its General
Partner
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as a Lender
By: /s/ Chad Schramek
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Name:
Title:
Chad Schramek, Assistant Treasurer
Strand Advisors, Inc., General Partner of
Highland Capital Management, L.P.
LENDER:
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Highland Loan Funding V Ltd.
By: Highland Capital Management, L.P., As
Collateral Manager
By: Strand Advisors, Inc., Its General
Partner
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as a Lender
By: /s/ Chad Schramek
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Name:
Title:
Chad Schramek, Assistant Treasurer
Strand Advisors, Inc., General Partner of
Highland Capital Management, L.P.
LENDER:
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California Public Employees' Retirement
System
By: Highland Capital Management, L.P., As
Authorized Representative of the Board
By: Strand Advisors, Inc., Its General
Partner
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as a Lender
By: /s/ Chad Schramek
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Name:
Title:
Chad Schramek, Assistant Treasurer
Strand Advisors, Inc., General Partner of
Highland Capital Management, L.P.
LENDER:
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Pam Capital Funding L.P.
By: Highland Capital Management, L.P., As
Collateral Manager
By: Strand Advisors, Inc., Its General
Partner
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as a Lender
By: /s/ Chad Schramek
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Name:
Title:
Chad Schramek, Assistant Treasurer
Strand Advisors, Inc., General Partner of
Highland Capital Management, L.P.
LENDER:
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SMBC DIP LIMITED,
as a Lender
By: /s/ Susumu Ogawa
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Name: Susumu Ogawa
Title: Director
LENDER:
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CDL LOAN FUNDING LLC,
as a Lender
By: /s/ Jason Trala
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Name: JASON TRALA
Title: Attorney-in-Fact
LENDER:
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_Oppenheimer Senior Floating Rate Fund,
as a Lender
By: /s/ Lisa Chaffee
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Name: Lisa Chaffee
Title: AVP
LENDER:
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Bayerische Hypo- und Vereinsbank AG,
New York Branch,
as a Lender
By: /s/ Miriam Trautmann
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Name: Miriam Trautmann
Title: Associate Director
By: /s/ Salvatore Esposito
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Name: Salvatore Esposito
Title: Managing Director
LENDER:
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Satellite Senior Income Fund, LLC
By: Satellite Asset Management, L.P.,
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as Investment Manager
By: /s/ Simon Raykher
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Name: Simon Raykher
Title: General Counsel
LENDER:
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WATCHTOWER CLO I PLC
By: Citadel Limited Partnership, Collateral
Manager
By: Citadel Investment Group, L.L.C., its
General Partner
as a Lender
By: /s/ Erica L. Tarpey
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Name: Erica L. Tarpey
Title: Authorized Signatory
LENDER:
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WINGATE CAPITAL LTD.
By: Citadel Limited Partnership, its
Portfolio Manager
By: Citadel Investment Group, L.L.C., its
General Partner
By: /s/ Erica L. Tarpey
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Name: Erica L. Tarpey
Title: Authorized Signatory