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PRIVILEGED AND CONFIDENTIAL ATTORNEY WORK PRODUCT DRAFT — FOR DISCUSSION PURPOSES ONLY

CREDIT AGREEMENT

DRAFT — May 16, 2022 — Calderwood & Harkness LLP Draft

among

VERIMARK HOSPITALITY GROUP INC.

as Borrower,

THE GUARANTORS PARTY HERETO,

THE LENDERS PARTY HERETO,

and

CRESCENT HARBOR BANK, N.A.

as Administrative Agent and Collateral Agent

________________________________________

$700,000,000 SENIOR SECURED TERM LOAN B FACILITY

________________________________________

Dated as of [●], 2022

CRESCENT HARBOR BANK, N.A. as Lead Arranger and Bookrunner

Prepared by:

Calderwood & Harkness LLP One Liberty Plaza, 52nd Floor New York, New York 10006

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CREDIT AGREEMENT

This CREDIT AGREEMENT (this "Agreement") is entered into as of [●], 2022, among:

(1) VERIMARK HOSPITALITY GROUP INC., a Delaware corporation (the "Borrower");

(2) the GUARANTORS from time to time party hereto (the "Guarantors" and, together with the Borrower, the "Loan Parties");

(3) the LENDERS from time to time party hereto (the "Lenders"); and

(4) CRESCENT HARBOR BANK, N.A., a national banking association, as administrative agent for the Lenders (in such capacity, together with its successors and assigns, the "Administrative Agent") and as collateral agent for the Secured Parties (in such capacity, together with its successors and assigns, the "Collateral Agent").

RECITALS

WHEREAS, the Borrower has requested that the Lenders provide a senior secured term loan facility in an aggregate principal amount of Seven Hundred Million Dollars ($700,000,000) (the "Term Loan Facility");

WHEREAS, the proceeds of the Term Loan Facility will be used on the Closing Date to (i) refinance in full the Borrower's existing $625,000,000 Term Loan B facility (the "Existing Term Loan Facility") with Greystone Federal Credit Corp., as administrative agent, and the lenders thereunder, (ii) fund up to $75,000,000 for permitted acquisitions and general corporate purposes, and (iii) pay fees, premiums, costs, and expenses related to the foregoing transactions;

WHEREAS, the Lenders are willing to make such term loans to the Borrower on the terms and subject to the conditions set forth herein;

WHEREAS, the obligations of the Borrower under this Agreement and the other Loan Documents will be guaranteed by the Guarantors pursuant to the Guarantee Agreement and will be secured by a first-priority lien on substantially all of the assets of the Borrower and the Guarantors (the "Collateral"), on a pari passu basis with the Borrower's existing $400,000,000 senior secured revolving credit facility (the "Existing RCF") with Crescent Harbor Bank, N.A., as administrative agent, all as more fully described herein; and

WHEREAS, the parties hereto desire to set forth the terms and conditions upon which such term loans shall be made.

NOW, THEREFORE, in consideration of the mutual covenants and agreements herein contained, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto 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:

"Adjusted EBITDA" means, for any period, Consolidated Net Income for such period plus (a) the following to the extent deducted in calculating such Consolidated Net Income: (i) Consolidated Interest Expense for such period, (ii) income tax expense for such period, (iii) depreciation and amortization expense for such period, (iv) non-cash charges for such period, including stock-based compensation expense, asset impairment charges, and other non-cash losses, (v) restructuring charges, transaction costs, and integration costs for such period (capped at $[●] per fiscal year), and (vi) pro forma adjustments for Permitted Acquisitions and Asset Sales consummated during such period (calculated as if such transactions had occurred on the first day of such period), minus (b) non-cash income items for such period (other than accruals of revenue in the ordinary course of business). For the avoidance of doubt, the Borrower's Adjusted EBITDA for the fiscal year ended December 31, 2021 was $341,000,000.

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

"Administrative Agent" means Crescent Harbor Bank, N.A., a national banking association, in its capacity as administrative agent under any of the Loan Documents, together with its successors and assigns in such capacity, having its principal office for purposes of this Agreement at 600 Lexington Avenue, 34th Floor, New York, New York 10022.

"Affiliate" means, with respect to any Person, another Person that directly, or indirectly through one or more intermediaries, Controls or is Controlled by or is under common Control with the Person specified.

"All-In Yield" means, with respect to any Indebtedness, the Applicable Margin with respect thereto plus (a) the amount of any original issue discount or upfront fees paid to Lenders (in each case amortized over a four (4) year assumed life, regardless of the stated maturity of such Indebtedness, and calculated using the straight-line method), and (b) the amount by which any interest rate floor applicable to such Indebtedness exceeds the Floor applicable to the initial Term Loans; provided that "All-In Yield" shall not include arrangement fees, structuring fees, underwriting fees, or commitment fees paid to arrangers, agents, or underwriters and not shared with all Lenders generally.

"Anti-Corruption Laws" means all laws, rules, and regulations of any jurisdiction applicable to the Borrower or any of its Subsidiaries from time to time concerning or relating to bribery, corruption, or money laundering, including the United States Foreign Corrupt Practices Act of 1977, as amended, and the rules and regulations thereunder.

"Applicable Margin" means, with respect to the Term Loans, 3.75% (375 basis points) per annum (subject to adjustment pursuant to Section 2.20(b)).

"Applicable Rate" means, with respect to any Term Loan, Adjusted Term SOFR plus the Applicable Margin.

"Approved Fund" means, with respect to any Lender, any fund that (a) invests in or purchases bank loans and similar extensions of credit in the ordinary course of its business, and (b) is advised or managed by (i) such Lender, (ii) an Affiliate of such Lender, or (iii) an entity or an Affiliate of an entity that administers or manages such Lender.

"Asset Sale" means any sale, transfer, lease, or other disposition (including any sale and leaseback transaction and any issuance of Equity Interests of a Subsidiary) by the Borrower or any Restricted Subsidiary of any asset, including any sale, transfer, or other disposition of any Equity Interests of a Subsidiary, but excluding (a) dispositions of inventory, obsolete or worn-out property, and other assets in the ordinary course of business, (b) dispositions among Loan Parties, and (c) other exceptions set forth in Section 6.04.

"Assignment and Assumption Agreement" means an Assignment and Assumption Agreement substantially in the form of Exhibit E (or any other form approved by the Administrative Agent), including any required supplements thereto.

"Bankruptcy Code" means Title 11 of the United States Code (11 U.S.C. Section 101 et seq.), as now or hereafter in effect.

"Benchmark" means, initially, Term SOFR; provided that if a Benchmark Transition Event and the related Benchmark Replacement Date have occurred with respect to Term SOFR, then "Benchmark" means the applicable Benchmark Replacement to the extent that such Benchmark Replacement has replaced Term SOFR pursuant to Section 2.19.

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

(1) the sum of (a) Term SOFR and (b) the related Benchmark Replacement Adjustment;

(2) the sum of (a) Daily Simple SOFR and (b) the related Benchmark Replacement Adjustment; or

(3) the sum of (a) the alternate benchmark rate that has been selected by the Administrative Agent and the Borrower as the replacement for the then-current Benchmark for the applicable Corresponding Tenor giving due consideration to (i) any selection or recommendation of a replacement benchmark rate or the mechanism for determining such a rate by the Relevant Governmental Body, or (ii) any evolving or then-prevailing market convention for determining a benchmark rate as a replacement for the then-current Benchmark for Dollar-denominated syndicated credit facilities at such time, and (b) the related Benchmark Replacement Adjustment,

provided that, in the case of clause (1) above, such Unadjusted Benchmark Replacement is displayed on a screen or other information service that publishes such rate from time to time as selected by the Administrative Agent in its reasonable discretion; provided further that, in each case, the applicable Benchmark Replacement as so determined shall be subject to the Floor.

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

"Benchmark Replacement Conforming Changes" means, with respect to any Benchmark Replacement, any technical, administrative, or operational changes (including changes to the definition of "Business Day," the definition of "U.S. Government Securities Business Day," the definition of "Interest Period," timing and frequency of determining rates and making payments of interest, timing of borrowing requests or prepayment, conversion or continuation notices, length of lookback periods, the applicability of breakage provisions, and other technical, administrative, or operational matters) that the Administrative Agent decides may be appropriate to reflect the adoption and implementation of such Benchmark Replacement and to permit the administration thereof by the Administrative Agent in a manner substantially consistent with market practice (or, if the Administrative Agent decides that adoption of any portion of such market practice is not administratively feasible or if the Administrative Agent determines that no market practice for the administration of such Benchmark Replacement exists, in such other manner of administration as the Administrative Agent decides is reasonably necessary in connection with the administration of this Agreement and the other Loan Documents).

"Benchmark Replacement Date" means the earliest to occur of the following events with respect to the then-current Benchmark: (a) in the case of clause (a) or (b) of the definition of "Benchmark Transition Event," the later of (i) the date of the public statement or publication of information referenced therein and (ii) the date on which the administrator of such Benchmark (or the published component used in the calculation thereof) permanently or indefinitely ceases to provide all Available Tenors of such Benchmark (or such component thereof), or (b) in the case of clause (c) of the definition of "Benchmark Transition Event," the first date on which such Benchmark (or the published component used in the calculation thereof) has been determined and announced by the regulatory supervisor for the administrator of such Benchmark to be no longer representative; provided that such non-representativeness will be determined by reference to the most recent statement or publication referenced in such clause (c) and even if any Available Tenor of such Benchmark (or such component thereof) continues to be provided on such date.

"Benchmark Transition Event" means the occurrence of one or more of the following events with respect to the then-current Benchmark: (a) a public statement or publication of information by or on behalf of the administrator of such Benchmark (or the published component used in the calculation thereof) announcing that such administrator has ceased or will cease to provide all Available Tenors of such Benchmark (or such component thereof), permanently or indefinitely, provided that, at the time of such statement or publication, there is no successor administrator that will continue to provide any Available Tenor of such Benchmark (or such component thereof); (b) a public statement or publication of information by the regulatory supervisor for the administrator of such Benchmark (or the published component used in the calculation thereof), the Federal Reserve Board, the Federal Reserve Bank of New York, an insolvency official with jurisdiction over the administrator for such Benchmark (or such component), a resolution authority with jurisdiction over the administrator for such Benchmark (or such component), or a court or an entity with similar insolvency or resolution authority over the administrator for such Benchmark (or such component), which states that the administrator of such Benchmark (or such component) has ceased or will cease to provide all Available Tenors of such Benchmark (or such component thereof) permanently or indefinitely, provided that, at the time of such statement or publication, there is no successor administrator that will continue to provide any Available Tenor of such Benchmark (or such component thereof); or (c) a public statement or publication of information by the regulatory supervisor for the administrator of such Benchmark (or the published component used in the calculation thereof) announcing that all Available Tenors of such Benchmark (or such component thereof) are no longer, or as of a specified future date will no longer be, representative.

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

"Borrower" means Verimark Hospitality Group Inc., a corporation organized and existing under the laws of the State of Delaware (EIN: 82-3741956; Delaware File No. 7291843).

"Borrowing Date" means the Closing Date.

"Borrowing Request" means a request by the Borrower for a Borrowing in accordance with Section 2.02, substantially in the form of Exhibit A or any other form approved by the Administrative Agent (including any form on an electronic platform or electronic transmission system as shall be approved by the Administrative Agent).

"Business Day" means any day that is not a Saturday, Sunday, or other day on which commercial banks in New York City are authorized or required by law to remain closed; provided that, when used in connection with a Term SOFR rate determination, the term "Business Day" shall also exclude any day on which the Securities Industry and Financial Markets Association recommends that the fixed income departments of its members be closed for the entire day for purposes of trading in United States government securities.

"Capital Lease" means, with respect to any Person, any lease of (or other arrangement conveying the right to use) any property (whether real, personal, or mixed) that is required to be classified and accounted for as a finance lease or capital lease on a balance sheet of such Person under GAAP.

"Cash Equivalents" means (a) direct obligations of, or obligations the principal of and interest on which are unconditionally guaranteed by, the United States of America (or by any agency thereof to the extent such obligations are backed by the full faith and credit of the United States of America), in each case maturing within one (1) year from the date of acquisition thereof, (b) investments in commercial paper maturing within two hundred seventy (270) days from the date of acquisition thereof and having, at such date of acquisition, the highest credit rating obtainable from S&P Global Ratings or Moody's Investors Service, Inc. (or any successor to either thereof), (c) investments in certificates of deposit, banker's acceptances, and time deposits maturing within one hundred eighty (180) days from the date of acquisition thereof, issued or guaranteed by or placed with, and money market deposit accounts issued or offered by, any domestic office of any commercial bank organized under the laws of the United States of America or any state thereof that has a combined capital and surplus and undivided profits of not less than $500,000,000, and (d) fully collateralized repurchase agreements with a term of not more than thirty (30) days for securities described in clause (a) above and entered into with a financial institution satisfying the criteria described in clause (c) above.

"Change of Control" means the occurrence of any of the following: (a) any "person" or "group" (as such terms are used in Sections 13(d) and 14(d) of the Securities Exchange Act of 1934, as amended) becomes the "beneficial owner" (as defined in Rules 13d-3 and 13d-5 under the Securities Exchange Act of 1934, as amended), directly or indirectly, of more than [●]% of the total voting power of all Equity Interests of the Borrower entitled to vote generally in the election of directors, (b) the Borrower ceases to directly or indirectly own, free and clear of all Liens (other than Permitted Liens), 100% of the Equity Interests of each Guarantor (other than directors' qualifying shares and other shares required to be held by Persons other than the Borrower or its Subsidiaries under applicable law), or (c) during any consecutive 24-month period, a majority of the members of the board of directors of the Borrower ceases to be composed of individuals (i) who were members of that board of directors on the first day of such period, (ii) whose election or nomination to that board of directors was approved by individuals referred to in clause (i) above constituting at the time of such election or nomination at least a majority of that board of directors, or (iii) whose election or nomination to that board of directors was approved by individuals referred to in clauses (i) and (ii) above constituting at the time of such election or nomination at least a majority of that board of directors.

"Closing Date" means [●], 2022.

"Collateral" means all property and assets of the Borrower and the Guarantors, whether real, personal, or mixed, tangible or intangible, now owned or hereafter acquired, in which a Lien is granted or purported to be granted pursuant to the Pledge and Security Agreement, the Mortgages, or any other Security Document.

"Collateral Agent" means Crescent Harbor Bank, N.A., a national banking association, in its capacity as collateral agent for the Secured Parties under the Loan Documents, together with its successors and assigns in such capacity.

"Commitment" means, with respect to each Lender, the commitment of such Lender to make its Term Loan hereunder as set forth opposite such Lender's name on Schedule 2.01 hereto or in the applicable Assignment and Assumption Agreement or Lender Accession Agreement pursuant to which such Lender shall have assumed its Commitment, as applicable, as such commitment may be reduced or increased from time to time pursuant to the terms hereof. The aggregate amount of the Commitments of all Lenders on the date hereof is Seven Hundred Million Dollars ($700,000,000).

"Compliance Certificate" means a certificate of a Responsible Officer of the Borrower substantially in the form of Exhibit B.

"Consolidated Interest Expense" means, for any period, the aggregate interest expense (including amortization of original issue discount and non-cash interest expense) of the Borrower and its Restricted Subsidiaries on a consolidated basis for such period, determined in accordance with GAAP, including (a) all commissions, discounts, and other fees and charges owed with respect to letters of credit and bankers' acceptance financing, (b) the interest component of Capital Lease obligations, and (c) net costs under Swap Contracts.

"Consolidated Net Income" means, for any period, the net income (or loss) of the Borrower and its Restricted Subsidiaries on a consolidated basis for such period, determined in accordance with GAAP; provided that there shall be excluded from Consolidated Net Income (a) extraordinary gains and losses, (b) non-cash gains and losses from sales, exchanges, or other dispositions of assets other than in the ordinary course of business, (c) any income (or loss) from discontinued operations, (d) the cumulative effect of a change in accounting principles during such period, (e) any income (or loss) of any Person (other than a Restricted Subsidiary of the Borrower) in which the Borrower or any Restricted Subsidiary has an ownership interest, except to the extent of the amount of dividends or distributions actually paid in cash to the Borrower or any Restricted Subsidiary, and (f) any non-cash compensation charge or expense arising from any grant of stock, stock options, restricted stock units, or other equity-based awards.

"Consolidated Total Debt" means, as of any date of determination, the aggregate principal amount of all Indebtedness of the Borrower and its Restricted Subsidiaries outstanding on such date, determined on a consolidated basis in accordance with GAAP.

"Control" means the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of a Person, whether through the ability to exercise voting power, by contract, or otherwise. "Controlling" and "Controlled" have meanings correlative thereto.

"CUSIP" means the Committee on Uniform Security Identification Procedures number assigned to the Term Loans, which is 92347LAB8.

"Daily Simple SOFR" means, for any day (a "SOFR Rate Day"), a rate per annum equal to SOFR for the day that is five (5) U.S. Government Securities Business Days prior to (i) if such SOFR Rate Day is a U.S. Government Securities Business Day, such SOFR Rate Day, or (ii) if such SOFR Rate Day is not a U.S. Government Securities Business Day, the U.S. Government Securities Business Day immediately preceding such SOFR Rate Day, in each case, as SOFR for any day is published by the SOFR Administrator on the SOFR Administrator's Website.

"Default" means any Event of Default or any event, act, or condition that, with the giving of notice, the lapse of time, or both, would constitute an Event of Default.

"Default Rate" means an interest rate per annum equal to the Applicable Rate then in effect plus 2.00% (200 basis points) per annum.

"Disqualified Lender" means (a) each Person designated by the Borrower to the Administrative Agent in writing on or prior to the Closing Date (or, with respect to updates, from time to time after the Closing Date), and (b) as to any Person described in clause (a), any of such Person's known Affiliates that are readily identifiable solely on the basis of the similarity of name; provided that the term "Disqualified Lender" shall not include any Person that is a bona fide debt fund or investment vehicle that is engaged in making, purchasing, holding, or otherwise investing in commercial loans and bonds in the ordinary course of its business, notwithstanding that such Person may be an Affiliate of a Person described in clause (a) above.

"Dollar" and the sign "$" mean lawful money of the United States of America.

"Eligible Assignee" means any Person that meets the requirements to be an assignee under Section 10.05(b) (subject to such consents, if any, as may be required under Section 10.05(b)); provided that no Disqualified Lender shall be an Eligible Assignee.

"Environmental Laws" means all laws, rules, regulations, codes, ordinances, orders, decrees, judgments, injunctions, or binding agreements issued, promulgated, or entered into by any Governmental Authority, relating in any way to the environment, preservation or reclamation of natural resources, the management, release, or threatened release of any Hazardous Material, or to health and safety matters.

"Equity Interests" means, with respect to any Person, all of the shares of capital stock of (or other ownership or profit interests in) such Person, all of the warrants, options, or other rights for the purchase or acquisition from such Person of shares of capital stock of (or other ownership or profit interests in) such Person, all of the securities convertible into or exchangeable for shares of capital stock of (or other ownership or profit interests in) such Person or warrants, rights, or options for the purchase or acquisition from such Person of such shares (or such other interests), and all of the other ownership or profit interests in such Person (including partnership, member, or trust interests therein), whether voting or nonvoting, and whether or not such shares, warrants, options, rights, or other interests are outstanding on any date of determination.

"ERISA" means the Employee Retirement Income Security Act of 1974, as amended from time to time.

"ERISA Affiliate" means any trade or business (whether or not incorporated) that, together with the Borrower, is treated as a single employer under Section 414(b) or (c) of the Code, or, solely for purposes of Section 302 of ERISA and Section 412 of the Code, is treated as a single employer under Section 414 of the Code.

"ERISA Event" means (a) any "reportable event," as defined in Section 4043 of ERISA or the regulations issued thereunder, with respect to a Plan (other than events for which the 30-day notice period is waived), (b) the failure to satisfy the "minimum funding standard" (as defined in Section 412 of the Code or Section 302 of ERISA), whether or not waived, (c) the filing pursuant to Section 412(c) of the Code or Section 302(c) of ERISA of an application for a waiver of the minimum funding standard with respect to any Plan, (d) a determination that any Plan is, or is expected to be, in "at risk" status (as defined in Section 430 of the Code or Section 303 of ERISA), (e) the incurrence by the Borrower or any ERISA Affiliate of any liability under Title IV of ERISA with respect to the termination of any Plan, (f) the receipt by the Borrower or any ERISA Affiliate from the PBGC or a plan administrator of any notice relating to an intention to terminate any Plan or Plans or to appoint a trustee to administer any Plan, (g) the incurrence by the Borrower or any ERISA Affiliate of any liability with respect to the withdrawal or partial withdrawal from any Plan or Multiemployer Plan, or (h) the receipt by the Borrower or any ERISA Affiliate of any notice, or the receipt by any Multiemployer Plan from the Borrower or any ERISA Affiliate of any notice, concerning the imposition of Withdrawal Liability or a determination that a Multiemployer Plan is, or is expected to be, insolvent or in reorganization, within the meaning of Title IV of ERISA.

"Event of Default" has the meaning set forth in Section 8.01.

"Excess Cash Flow" means, for any fiscal year of the Borrower, Adjusted EBITDA for such fiscal year minus (a) the sum of (i) cash interest expense paid during such fiscal year (excluding amounts paid with the proceeds of Indebtedness), (ii) scheduled principal payments on the Term Loans actually made during such fiscal year pursuant to Section 2.05(a), (iii) cash income taxes paid during such fiscal year, (iv) Capital Expenditures made in cash during such fiscal year (to the extent not financed with the proceeds of Indebtedness), (v) any voluntary prepayments of the Term Loans pursuant to Section 2.11(a) actually made during such fiscal year (to the extent not financed with the proceeds of Indebtedness), and (vi) net increases in working capital during such fiscal year, plus (b) net decreases in working capital during such fiscal year.

"Existing RCF" means the $400,000,000 senior secured revolving credit facility, dated as of February 14, 2020 (as amended, restated, supplemented, or otherwise modified from time to time), among the Borrower, the guarantors party thereto, the lenders party thereto, and Crescent Harbor Bank, N.A., as administrative agent.

"Existing Term Loan Facility" means the existing $625,000,000 Term Loan B credit facility, originally dated as of February 14, 2020 (as amended, restated, supplemented, or otherwise modified from time to time), among the Borrower, the guarantors party thereto, the lenders party thereto, and Greystone Federal Credit Corp., as administrative agent (CUSIP: 92347LAA0).

"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 or official interpretations thereof, any agreements entered into pursuant to Section 1471(b)(1) of the Code, and any fiscal or regulatory legislation, rules, or practices adopted pursuant to any intergovernmental agreement, treaty, or convention among Governmental Authorities entered into in connection with the implementation of the foregoing.

"Federal Reserve Bank of New York's Website" means the website of the Federal Reserve Bank of New York at http://www.newyorkfed.org, or any successor source.

"Fee Letter" means the Fee Letter, dated as of the date of the Commitment Letter, between the Borrower and Crescent Harbor Bank, N.A., in its capacity as Lead Arranger and Bookrunner, as amended, restated, or otherwise modified from time to time.

"First Lien Intercreditor Agreement" means the Amended and Restated Intercreditor Agreement, dated as of the Closing Date, among the Administrative Agent (in its capacity as TLB Agent and RCF Agent), the Borrower, and the other parties thereto, as amended, restated, supplemented, or otherwise modified from time to time.

"Floor" means a rate of interest per annum equal to 0.50% (50 basis points).

"GAAP" means generally accepted accounting principles in the United States of America as in effect from time to time, subject to Section 1.03.

"Governmental Authority" means the government of the United States of America or any other nation, or of any political subdivision thereof, whether state or local, and any agency, authority, instrumentality, regulatory body, court, central bank, or other entity exercising executive, legislative, judicial, taxing, regulatory, or administrative powers or functions of or pertaining to government.

"Guarantee Agreement" means the Guarantee Agreement, dated as of the Closing Date, made by the Guarantors in favor of the Administrative Agent for the benefit of the Secured Parties, substantially in the form agreed upon by the parties hereto, as such agreement may be amended, restated, supplemented, or otherwise modified from time to time.

"Guarantors" means (a) Verimark Resort Properties LLC, a Delaware limited liability company, (b) VHG Management Services Inc., a Delaware corporation, (c) Verimark Convention Holdings LLC, a Delaware limited liability company, (d) Palmetto Beachfront Hotels LLC, a Florida limited liability company, (e) Cascadia Hospitality Corp., a Delaware corporation, and (f) each other Subsidiary that becomes a Guarantor pursuant to Section 5.12, in each case, until such time as such Person's guarantee of the Secured Obligations is released in accordance with the terms of the Guarantee Agreement.

"Hazardous Material" means all explosive or radioactive substances or wastes and all hazardous or toxic substances, wastes, or other pollutants, including petroleum or petroleum distillates, asbestos or asbestos-containing materials, polychlorinated biphenyls, radon gas, infectious or medical wastes, and all other substances or wastes of any nature regulated pursuant to any Environmental Law.

"Incremental Term Loans" has the meaning set forth in Section 2.20.

"Indebtedness" means, with respect to any Person, without duplication, (a) all obligations of such Person for borrowed money, (b) all obligations of such Person evidenced by bonds, debentures, notes, or similar instruments, (c) all obligations of such Person under conditional sale or other title retention agreements relating to property acquired by such Person, (d) all obligations of such Person in respect of the deferred purchase price of property or services (other than current trade payables incurred in the ordinary course of business), (e) all Indebtedness of others secured by (or for which the holder of such Indebtedness has an existing right, contingent or otherwise, to be secured by) any Lien on property owned or acquired by such Person, whether or not the Indebtedness secured thereby has been assumed, (f) all guarantees by such Person of Indebtedness of others, (g) all Capital Lease obligations of such Person, (h) all obligations of such Person in respect of bankers' acceptances, (i) all obligations of such Person as an account party in respect of letters of credit and letters of guaranty, and (j) all obligations of such Person in respect of Swap Contracts.

"Interest Period" means, with respect to any Term Loan, (a) initially, the period commencing on the Closing Date and ending on the last day of the calendar month in which the Closing Date occurs (or if the Closing Date is the last day of a calendar month, ending on the numerically corresponding day in the next succeeding calendar month that is one (1), three (3), or six (6) months after the Closing Date, as selected by the Borrower), and (b) thereafter, each period commencing on the last day of the immediately preceding Interest Period and ending on the numerically corresponding day in the calendar month that is one (1), three (3), or six (6) months thereafter, as selected by the Borrower in its Borrowing Request or interest period selection notice; provided that (i) if any Interest Period would end on a day other than a Business Day, such Interest Period shall be extended to the next succeeding Business Day unless such next succeeding Business Day would fall in the next calendar month, in which case such Interest Period shall end on the next preceding Business Day, (ii) any Interest Period that commences on the last Business Day of a calendar month (or on a day for which there is no numerically corresponding day in the last month of such Interest Period) shall end on the last Business Day of the last month of such Interest Period, and (iii) no Interest Period shall extend beyond the Maturity Date.

"Lead Arranger" means Crescent Harbor Bank, N.A., in its capacity as sole lead arranger and sole bookrunner.

"Lender" means each financial institution listed on Schedule 2.01 hereto (other than any such financial institution that has ceased to be a party hereto pursuant to an Assignment and Assumption Agreement) and any Eligible Assignee that has become a party hereto pursuant to an Assignment and Assumption Agreement or a Lender Accession Agreement.

"Lender Accession Agreement" means a Lender Accession Agreement substantially in the form of Exhibit F.

"Lien" means, with respect to any asset, (a) any mortgage, deed of trust, lien, pledge, hypothecation, encumbrance, charge, or security interest in, on, or of such asset, (b) the interest of a vendor or a lessor under any conditional sale agreement, capital lease, or title retention agreement (or any financing lease having substantially the same economic effect as any of the foregoing) relating to such asset, and (c) in the case of securities, any purchase option, call, or similar right of a third party with respect to such securities.

"Loan Documents" means this Agreement, the Guarantee Agreement, the Pledge and Security Agreement, the Mortgages, the First Lien Intercreditor Agreement, the Notes, each Lender Accession Agreement, each Assignment and Assumption Agreement, and each other document, instrument, or agreement delivered in connection with any of the foregoing.

"Loan Party" means the Borrower and each Guarantor.

"Material Adverse Effect" means a material adverse effect on (a) the business, assets, operations, or financial condition of the Borrower and its Subsidiaries taken as a whole, (b) the ability of any Loan Party to perform any of its material obligations under any Loan Document to which it is a party, or (c) the rights of or benefits available to the Administrative Agent or the Lenders under the Loan Documents, including the validity or enforceability of any Loan Document or the perfection or priority of any Lien granted thereunder.

"Material Subsidiary" means each Subsidiary of the Borrower that, as of the last day of the most recently ended fiscal quarter for which financial statements have been delivered pursuant to Section 5.01, had total assets with a book value in excess of 5.0% of the total consolidated assets of the Borrower and its Subsidiaries or revenues representing more than 5.0% of the total consolidated revenues of the Borrower and its Subsidiaries.

"Maturity Date" means the date that is seven (7) years after the Closing Date; provided that if such date is not a Business Day, the Maturity Date shall be the immediately preceding Business Day.

"MFN Protection" has the meaning set forth in Section 2.20(b).

"MFN Sunset Date" means the date that is eighteen (18) months after the Closing Date.

"MFN Threshold" means 50 basis points (0.50%).

"Mortgaged Properties" means the 42 hotel properties owned by Verimark Resort Properties LLC, Palmetto Beachfront Hotels LLC, and the other Guarantors that are subject to Mortgages in favor of the Collateral Agent, located across the following states: Florida (12 properties), New York (6 properties), California (5 properties), Texas (4 properties), Georgia (3 properties), Colorado (3 properties), Arizona (2 properties), Illinois (2 properties), Washington (2 properties), Oregon (1 property), Nevada (1 property), and Virginia (1 property), which Mortgaged Properties have an aggregate appraised value of approximately $2,180,000,000 as of the date hereof.

"Mortgages" means the mortgages, deeds of trust, deeds to secure debt, and similar instruments executed and delivered by the Loan Parties in favor of the Collateral Agent for the benefit of the Secured Parties, with respect to the Mortgaged Properties.

"Net Proceeds" means, with respect to any Asset Sale or casualty or condemnation event, the aggregate cash proceeds and Cash Equivalents received by the Borrower or any of its Restricted Subsidiaries in connection therewith, net of (a) the direct costs relating to such event (including legal, accounting, investment banking, and brokerage fees, and sales commissions), (b) taxes paid or reasonably estimated to be payable as a result thereof (after taking into account any available tax credits or deductions and any tax sharing arrangements), (c) amounts required to be applied to the repayment of Indebtedness (other than the Term Loans) secured by a Lien on the asset or assets that were the subject of such event, and (d) any reserve for adjustment in respect of (i) the sale price of such asset established in accordance with GAAP, and (ii) any liabilities associated with such asset and retained by the Borrower or any Restricted Subsidiary after such sale or other disposition thereof, including pension and other post-employment benefit liabilities and liabilities related to Environmental Laws, in each case as determined by the Borrower in good faith.

"Notes" means the promissory notes, if any, issued by the Borrower pursuant to Section 2.09(c), substantially in the form of Exhibit D.

"Obligations" means all advances to, and debts, liabilities, obligations, covenants, and duties of, any Loan Party arising under any Loan Document, 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 Law naming such Person as the debtor in such proceeding, regardless of whether such interest and fees are allowed claims in such proceeding.

"Officer's Closing Certificate" means a certificate of a Responsible Officer of the Borrower substantially in the form of Exhibit G.

"Original Issue discount" or "OID" means 1.00% of the aggregate principal amount of the Term Loans ($7,000,000), such that the Term Loans shall be funded at 99.00% of par.

"Perfection Certificate" means a certificate in form and substance satisfactory to the Collateral Agent setting forth the information required for the perfection of the security interests granted under the Security Documents.

"Permitted Acquisition" means any acquisition by the Borrower or any Restricted Subsidiary of all or substantially all the assets of, or all or substantially all the Equity Interests in, a Person or division or business unit of a Person; provided that (a) no Default or Event of Default shall have occurred and be continuing at the time of, or would result from, such acquisition, (b) after giving pro forma effect to such acquisition, the Borrower is in compliance with the financial covenant set forth in Section 7.01 (to the extent tested), (c) such acquisition is consummated in compliance with all applicable laws, and (d) the Borrower shall have delivered to the Administrative Agent a pro forma Compliance Certificate demonstrating compliance with the foregoing.

"Permitted Indebtedness" has the meaning set forth in Section 6.01.

"Permitted Liens" has the meaning set forth in Section 6.02.

"Person" means any natural person, corporation, limited liability company, trust, joint venture, association, company, partnership, Governmental Authority, or other entity.

"Plan" means any "employee benefit plan" (as defined in Section 3(3) of ERISA) that is maintained or contributed to by the Borrower or any ERISA Affiliate, or for which the Borrower or any ERISA Affiliate has any liability.

"Pledge and Security Agreement" means the Pledge and Security Agreement, dated as of the Closing Date, among the Loan Parties and the Collateral Agent, as such agreement may be amended, restated, supplemented, or otherwise modified from time to time.

"Repricing Event" means (a) any prepayment or refinancing of all or any portion of the Term Loans in connection with, or substantially concurrently with, any new or replacement term loan indebtedness bearing interest at an effective yield (as reasonably determined by the Administrative Agent) that is lower than the effective yield on the Term Loans so prepaid or refinanced, or (b) any amendment to this Agreement that reduces the Applicable Margin or the effective yield applicable to the Term Loans; provided that a Repricing Event shall not include any prepayment or refinancing of the Term Loans made in connection with (i) a Change of Control, (ii) a transformative acquisition, or (iii) any other transaction that is not primarily intended to lower the effective yield on the Term Loans.

"Repricing Protection Period" means the period from and including the Closing Date to and including the date that is six (6) months after the Closing Date.

"Required Lenders" means, at any time, Lenders having Term Loans representing more than 50% of the aggregate outstanding principal amount of all Term Loans at such time; provided that the Term Loans of any Defaulting Lender shall be excluded from the determination of Required Lenders at any time.

"Responsible Officer" means the chief executive officer, the president, the chief financial officer, the treasurer, the assistant treasurer, or the general counsel of the Borrower, and solely for purposes of notices given pursuant to Article II, any other officer or employee of the Borrower so designated by any of the foregoing officers in a notice to the Administrative Agent. Any document delivered hereunder that is signed by a Responsible Officer of the Borrower shall be conclusively presumed to have been authorized by all necessary corporate, partnership, and/or other action on the part of the Borrower and such Responsible Officer shall be conclusively presumed to have acted on behalf of the Borrower.

"Restricted Payment" means any dividend or other distribution (whether in cash, securities, or other property) with respect to any Equity Interests of the Borrower or any Restricted Subsidiary, or any payment (whether in cash, securities, or other property), including any sinking fund or similar deposit, on account of the purchase, redemption, retirement, defeasance, acquisition, cancellation, or termination of any such Equity Interests, or on account of any return of capital to the Borrower's stockholders, partners, or members (or the equivalent Persons thereof).

"Restricted Subsidiary" means any Subsidiary of the Borrower that is not an Unrestricted Subsidiary.

"Sanctioned Country" means, at any time, a country, region, or territory that is itself the subject or target of any comprehensive Sanctions (at the time of this Agreement, Cuba, Iran, North Korea, Syria, and the Crimea, Donetsk People's Republic, and Luhansk People's Republic regions of Ukraine).

"Sanctioned Person" means, at any time, (a) any Person listed in any Sanctions-related list of designated Persons maintained by OFAC, the U.S. Department of State, or the United Nations Security Council, (b) any Person operating, organized, or resident in a Sanctioned Country, (c) any Person owned or controlled by any such Person or Persons described in the foregoing clauses (a) or (b), or (d) any Person otherwise the target of Sanctions.

"Sanctions" means all economic or financial sanctions or trade embargoes imposed, administered, or enforced from time to time by (a) the U.S. government, including those administered by OFAC or the U.S. Department of State, or (b) the United Nations Security Council, the European Union, or Her Majesty's Treasury of the United Kingdom.

"Secured Obligations" means the Obligations.

"Secured Parties" means, collectively, the Administrative Agent, the Collateral Agent, and the Lenders.

"Secretary's Certificate" means a certificate of the secretary or assistant secretary (or equivalent officer) of a Loan Party substantially in the form of Exhibit H.

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

"SOFR Adjustment" means (a) 0.10% (10 basis points) with respect to a one-month Interest Period, (b) 0.15% (15 basis points) with respect to a three-month Interest Period, and (c) 0.25% (25 basis points) with respect to a six-month Interest Period.

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

"SOFR Administrator's Website" means the website of the Federal Reserve Bank of New York, currently at http://www.newyorkfed.org (or any successor source for the secured overnight financing rate identified as such by the SOFR Administrator from time to time).

"Solvent" means, with respect to any Person as of any date of determination, that as of such date (a) the sum of the debts and liabilities (including contingent liabilities) of such Person and its Subsidiaries, taken as a whole, does not exceed the fair value of the assets of such Person and its Subsidiaries, taken as a whole, (b) the present fair saleable value of the assets of such Person and its Subsidiaries, taken as a whole, is not less than the amount that will be required to pay the probable liability on such Person's and its Subsidiaries' existing debts and liabilities (including contingent liabilities) as they become absolute and matured, (c) such Person and its Subsidiaries, taken as a whole, do not intend to, and do not believe that they will, incur debts or liabilities beyond their ability to pay as such debts and liabilities mature, and (d) such Person and its Subsidiaries, taken as a whole, are not engaged in a business or a transaction, and are not about to engage in a business or a transaction, for which their assets would constitute unreasonably small capital.

"Solvency Certificate" means a certificate of the Chief Financial Officer of the Borrower substantially in the form of Exhibit C.

"Subsidiary" means, with respect to any Person (the "parent"), any corporation, partnership, joint venture, limited liability company, or other business entity of which a majority of the shares of Equity Interests having ordinary voting power for the election of directors, managers, or other governing body (other than securities or interests having such power only by reason of the happening of a contingency) are at the time beneficially owned, or the management of which is otherwise controlled, directly, or indirectly through one or more intermediaries, or both, by such parent.

"Swap Contract" means (a) any and all rate swap transactions, basis swaps, credit derivative transactions, forward rate transactions, commodity swaps, commodity options, forward commodity contracts, equity or equity index swaps or options, bond or bond price or bond index swaps or options or forward bond or forward bond price or forward bond index transactions, interest rate options, forward foreign exchange transactions, cap transactions, floor transactions, collar transactions, currency swap transactions, cross-currency rate swap transactions, currency options, spot contracts, or any other similar transactions or any combination of any of the foregoing (including any options to enter into any of the foregoing), whether or not any such transaction is governed by or subject to any master agreement, and (b) any and all transactions of any kind, and the related confirmations, that are subject to the terms and conditions of, or governed by, any form of master agreement published by the International Swaps and Derivatives Association, Inc., any International Foreign Exchange Master Agreement, or any other master agreement.

"Term Loan" or "Term Loans" means the term loans made by the Lenders to the Borrower pursuant to Section 2.01 on the Closing Date, in the aggregate principal amount of Seven Hundred Million Dollars ($700,000,000).

"Term SOFR" means, for the applicable Corresponding Tenor as of the applicable Reference Time, the forward-looking term rate based on SOFR that has been selected by the Administrative Agent and is published by the CME Group Benchmark Administration Ltd. (or a successor administrator satisfactory to the Administrative Agent); provided that if as of 5:00 p.m. (New York City time) on any day that is two (2) U.S. Government Securities Business Days preceding the first day of any Interest Period, the Term SOFR for the applicable Corresponding Tenor has not been published by the CME Group Benchmark Administration Ltd. (or a successor administrator) and a Benchmark Replacement Date with respect to the Term SOFR has not occurred, then Term SOFR will be the Term SOFR as published for such tenor as of such Reference Time for the first preceding U.S. Government Securities Business Day for which Term SOFR for such tenor was published by the CME Group Benchmark Administration Ltd. (or a successor administrator), so long as such first preceding U.S. Government Securities Business Day is not more than three (3) U.S. Government Securities Business Days prior to such Reference Time.

"Total Net Leverage Ratio" means, as of any date of determination, the ratio of (a) Consolidated Total Debt as of such date minus unrestricted cash and Cash Equivalents of the Borrower and its Restricted Subsidiaries as of such date (in an aggregate amount not to exceed $[●]) to (b) Adjusted EBITDA for the most recently ended period of four (4) consecutive fiscal quarters of the Borrower for which financial statements have been delivered pursuant to Section 5.01 (or, for any determination prior to the delivery of the first set of financial statements after the Closing Date, the period of four consecutive fiscal quarters most recently ended prior to the Closing Date). For the avoidance of doubt, the pro forma Total Net Leverage Ratio as of the Closing Date (after giving effect to the transactions contemplated hereby) is approximately 2.52 to 1.00 ($858,000,000 in net debt divided by $341,000,000 in LTM Adjusted EBITDA).

"Unrestricted Subsidiary" means any Subsidiary of the Borrower designated by the Borrower as an "Unrestricted Subsidiary" in accordance with Section 6.01, after the Closing Date.

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

Section 1.02 — Other Interpretive Provisions

With reference to this Agreement and each other Loan Document, unless otherwise specified herein or in such other Loan Document:

(a) The definitions of terms herein shall apply equally to the singular and plural forms of the terms defined. Whenever the context may require, any pronoun shall include the corresponding masculine, feminine, and neuter forms. The words "include," "includes," and "including" shall be deemed to be followed by the phrase "without limitation." The word "will" shall be construed to have the same meaning and effect as the word "shall." Unless the context requires otherwise, (i) any definition of or reference to any agreement, instrument, or other document herein (including this Agreement) shall be construed as referring to such agreement, instrument, or other document as from time to time amended, supplemented, restated, or otherwise modified (subject to any restrictions on such amendments, supplements, restatements, or modifications set forth herein or in any other Loan Document), (ii) any reference herein to any Person shall be construed to include such Person's successors and assigns, (iii) the words "herein," "hereof," and "hereunder," and words of similar import when used in any Loan Document shall be construed to refer to such Loan Document in its entirety and not to any particular provision thereof, (iv) all references in a Loan Document to Articles, Sections, Exhibits, and Schedules shall be construed to refer to Articles and Sections of, and Exhibits and Schedules to, the Loan Document in which such references appear, (v) any reference to any law shall include all statutory and regulatory provisions consolidating, amending, replacing, or interpreting such law and any reference to any law or regulation shall, unless otherwise specified, refer to such law or regulation as amended, modified, or supplemented from time to time, and (vi) the words "asset" and "property" shall be construed to have the same meaning and effect and to refer to any and all tangible and intangible assets and properties, including cash, securities, accounts, and contract rights.

(b) In the computation of periods of time from a specified date to a later specified date, the word "from" means "from and including" and the words "to" and "until" each mean "to but excluding."

(c) Section headings herein and in the other Loan Documents are included herein for convenience of reference only and shall not affect the interpretation of this Agreement or any other Loan Document.

(d) In the event of any conflict between the terms of this Agreement and any other Loan Document, the terms of this Agreement shall control (except with respect to the First Lien Intercreditor Agreement, which shall control in the event of any conflict with this Agreement as it relates to intercreditor matters, and except as otherwise expressly provided in the applicable Loan Document with the consent of the Administrative Agent).

Section 1.03 — Accounting Terms

(a) All accounting terms not specifically or completely defined herein shall be construed in conformity with, and all financial data (including financial ratios and other financial calculations) required to be submitted pursuant to this Agreement shall be prepared in conformity with, GAAP as in effect from time to time, applied in a manner consistent with that used in preparing the audited financial statements referred to in Section 4.04, except as otherwise specifically prescribed herein.

(b) Notwithstanding any other provision contained herein, all terms of an accounting or financial nature used herein shall be construed, and all computations of amounts and ratios referred to herein shall be made, without giving effect to any election under Accounting Standards Codification Topic 825 — Financial Instruments (or any other Accounting Standards Codification or Financial Accounting Standard having a similar result or effect) to value any Indebtedness or other liabilities of the Borrower or any Subsidiary at "fair value," as defined therein.

(c) If at any time any change in GAAP would affect the computation of any financial ratio or requirement set forth in any Loan Document, and either the Borrower or the Required Lenders shall so request, the Administrative Agent, the Lenders, and the Borrower shall negotiate in good faith to amend such ratio or requirement to preserve the original intent thereof in light of such change in GAAP (subject to the approval of the Required Lenders); provided that, until so amended, (i) such ratio or requirement shall continue to be computed in accordance with GAAP prior to such change therein, and (ii) the Borrower shall provide to the Administrative Agent and the Lenders financial statements and other documents required under this Agreement or as reasonably requested hereunder setting forth a reconciliation between calculations of such ratio or requirement made before and after giving effect to such change in GAAP (the "Frozen GAAP Election").

(d) For the avoidance of doubt, the Borrower's audited financial statements have been prepared by Clearmont & Wharton LLP (Ronald Ashby, engagement partner), an independent registered public accounting firm, in accordance with GAAP.

Section 1.04 — Rounding

Any financial ratios required to be maintained by the Borrower pursuant to this Agreement shall be calculated by dividing the appropriate component by the other component, carrying the result to one place more than the number of places by which such ratio is expressed herein, and rounding the result up or down to the nearest number (with a rounding-up if there is no nearest number). All financial calculations made pursuant to this Agreement shall be rounded to the nearest one-hundredth (1/100th).

Section 1.05 — Times of Day

Unless otherwise specified, all references herein to times of day shall be references to New York City time (Eastern Time).

Section 1.06 — Letter of Credit Amounts

[Reserved.]

Section 1.07 — SOFR Matters

(a) The Administrative Agent does not warrant, nor accept responsibility for, nor shall the Administrative Agent have any liability with respect to, (i) the continuation of, administration of, submission of, calculation of, or any other matter related to the Benchmark, any component definition thereof, or rates referenced in the defi

PRIVILEGED AND CONFIDENTIAL ATTORNEY WORK PRODUCT DRAFT — FOR DISCUSSION PURPOSES ONLY
CREDIT AGREEMENT
DRAFT — May 16, 2022 — Calderwood & Harkness LLP Draft
among
VERIMARK HOSPITALITY GROUP INC.
as Borrower,
THE GUARANTORS PARTY HERETO,
THE LENDERS PARTY HERETO,
and
CRESCENT HARBOR BANK, N.A.
as Administrative Agent and Collateral Agent
________________________________________
$700,000,000 SENIOR SECURED TERM LOAN B FACILITY
________________________________________
Dated as of [●], 2022
CRESCENT HARBOR BANK, N.A. as Lead Arranger and Bookrunner
Prepared by:
Calderwood & Harkness LLP One Liberty Plaza, 52nd Floor New York, New York 10006
TABLE OF CONTENTS
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CREDIT AGREEMENT
This CREDIT AGREEMENT (this "Agreement") is entered into as of [●], 2022, among:
(1) VERIMARK HOSPITALITY GROUP INC., a Delaware corporation (the "Borrower");
(2) the GUARANTORS from time to time party hereto (the "Guarantors" and, together with the Borrower, the "Loan Parties");
(3) the LENDERS from time to time party hereto (the "Lenders"); and
(4) CRESCENT HARBOR BANK, N.A., a national banking association, as administrative agent for the Lenders (in such capacity, together with its successors and assigns, the "Administrative Agent") and as collateral agent for the Secured Parties (in such capacity, together with its successors and assigns, the "Collateral Agent").
RECITALS
WHEREAS, the Borrower has requested that the Lenders provide a senior secured term loan facility in an aggregate principal amount of Seven Hundred Million Dollars ($700,000,000) (the "Term Loan Facility");
WHEREAS, the proceeds of the Term Loan Facility will be used on the Closing Date to (i) refinance in full the Borrower's existing $625,000,000 Term Loan B facility (the "Existing Term Loan Facility") with Greystone Federal Credit Corp., as administrative agent, and the lenders thereunder, (ii) fund up to $75,000,000 for permitted acquisitions and general corporate purposes, and (iii) pay fees, premiums, costs, and expenses related to the foregoing transactions;
WHEREAS, the Lenders are willing to make such term loans to the Borrower on the terms and subject to the conditions set forth herein;
WHEREAS, the obligations of the Borrower under this Agreement and the other Loan Documents will be guaranteed by the Guarantors pursuant to the Guarantee Agreement and will be secured by a first-priority lien on substantially all of the assets of the Borrower and the Guarantors (the "Collateral"), on a pari passu basis with the Borrower's existing $400,000,000 senior secured revolving credit facility (the "Existing RCF") with Crescent Harbor Bank, N.A., as administrative agent, all as more fully described herein; and
WHEREAS, the parties hereto desire to set forth the terms and conditions upon which such term loans shall be made.
NOW, THEREFORE, in consideration of the mutual covenants and agreements herein contained, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto 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:
"Adjusted EBITDA" means, for any period, Consolidated Net Income for such period plus (a) the following to the extent deducted in calculating such Consolidated Net Income: (i) Consolidated Interest Expense for such period, (ii) income tax expense for such period, (iii) depreciation and amortization expense for such period, (iv) non-cash charges for such period, including stock-based compensation expense, asset impairment charges, and other non-cash losses, (v) restructuring charges, transaction costs, and integration costs for such period (capped at $[●] per fiscal year), and (vi) pro forma adjustments for Permitted Acquisitions and Asset Sales consummated during such period (calculated as if such transactions had occurred on the first day of such period), minus (b) non-cash income items for such period (other than accruals of revenue in the ordinary course of business). For the avoidance of doubt, the Borrower's Adjusted EBITDA for the fiscal year ended December 31, 2021 was $341,000,000.
"Adjusted Term SOFR" means, for any Interest Period, the per annum rate equal to the sum of (a) Term SOFR for such Interest Period plus (b) the SOFR Adjustment applicable to such Interest Period; provided that if Adjusted Term SOFR as so determined shall ever be less than the Floor, then Adjusted Term SOFR shall be deemed to be the Floor.
"Administrative Agent" means Crescent Harbor Bank, N.A., a national banking association, in its capacity as administrative agent under any of the Loan Documents, together with its successors and assigns in such capacity, having its principal office for purposes of this Agreement at 600 Lexington Avenue, 34th Floor, New York, New York 10022.
"Affiliate" means, with respect to any Person, another Person that directly, or indirectly through one or more intermediaries, Controls or is Controlled by or is under common Control with the Person specified.
"All-In Yield" means, with respect to any Indebtedness, the Applicable Margin with respect thereto plus (a) the amount of any original issue discount or upfront fees paid to Lenders (in each case amortized over a four (4) year assumed life, regardless of the stated maturity of such Indebtedness, and calculated using the straight-line method), and (b) the amount by which any interest rate floor applicable to such Indebtedness exceeds the Floor applicable to the initial Term Loans; provided that "All-In Yield" shall not include arrangement fees, structuring fees, underwriting fees, or commitment fees paid to arrangers, agents, or underwriters and not shared with all Lenders generally.
"Anti-Corruption Laws" means all laws, rules, and regulations of any jurisdiction applicable to the Borrower or any of its Subsidiaries from time to time concerning or relating to bribery, corruption, or money laundering, including the United States Foreign Corrupt Practices Act of 1977, as amended, and the rules and regulations thereunder.
"Applicable Margin" means, with respect to the Term Loans, 3.75% (375 basis points) per annum (subject to adjustment pursuant to Section 2.20(b)).
"Applicable Rate" means, with respect to any Term Loan, Adjusted Term SOFR plus the Applicable Margin.
"Approved Fund" means, with respect to any Lender, any fund that (a) invests in or purchases bank loans and similar extensions of credit in the ordinary course of its business, and (b) is advised or managed by (i) such Lender, (ii) an Affiliate of such Lender, or (iii) an entity or an Affiliate of an entity that administers or manages such Lender.
"Asset Sale" means any sale, transfer, lease, or other disposition (including any sale and leaseback transaction and any issuance of Equity Interests of a Subsidiary) by the Borrower or any Restricted Subsidiary of any asset, including any sale, transfer, or other disposition of any Equity Interests of a Subsidiary, but excluding (a) dispositions of inventory, obsolete or worn-out property, and other assets in the ordinary course of business, (b) dispositions among Loan Parties, and (c) other exceptions set forth in Section 6.04.
"Assignment and Assumption Agreement" means an Assignment and Assumption Agreement substantially in the form of Exhibit E (or any other form approved by the Administrative Agent), including any required supplements thereto.
"Bankruptcy Code" means Title 11 of the United States Code (11 U.S.C. Section 101 et seq.), as now or hereafter in effect.
"Benchmark" means, initially, Term SOFR; provided that if a Benchmark Transition Event and the related Benchmark Replacement Date have occurred with respect to Term SOFR, then "Benchmark" means the applicable Benchmark Replacement to the extent that such Benchmark Replacement has replaced Term SOFR pursuant to Section 2.19.
"Benchmark Replacement" means, with respect to any Benchmark Transition Event, the first alternative set forth in the order below that can be determined by the Administrative Agent for the applicable Benchmark Replacement Date:
(1) the sum of (a) Term SOFR and (b) the related Benchmark Replacement Adjustment;
(2) the sum of (a) Daily Simple SOFR and (b) the related Benchmark Replacement Adjustment; or
(3) the sum of (a) the alternate benchmark rate that has been selected by the Administrative Agent and the Borrower as the replacement for the then-current Benchmark for the applicable Corresponding Tenor giving due consideration to (i) any selection or recommendation of a replacement benchmark rate or the mechanism for determining such a rate by the Relevant Governmental Body, or (ii) any evolving or then-prevailing market convention for determining a benchmark rate as a replacement for the then-current Benchmark for Dollar-denominated syndicated credit facilities at such time, and (b) the related Benchmark Replacement Adjustment,
provided that, in the case of clause (1) above, such Unadjusted Benchmark Replacement is displayed on a screen or other information service that publishes such rate from time to time as selected by the Administrative Agent in its reasonable discretion; provided further that, in each case, the applicable Benchmark Replacement as so determined shall be subject to the Floor.
"Benchmark Replacement Adjustment" means, with respect to any replacement of the then-current Benchmark with an Unadjusted Benchmark Replacement, the spread adjustment, or method for calculating or determining such spread adjustment (which may be a positive or negative value or zero), that has been selected by the Administrative Agent and the Borrower giving due consideration to (a) any selection or recommendation of a spread adjustment, or method for calculating or determining such spread adjustment, for the replacement of such Benchmark with the applicable Unadjusted Benchmark Replacement by the Relevant Governmental Body, or (b) any evolving or then-prevailing market convention for determining a spread adjustment, or method for calculating or determining such spread adjustment, for the replacement of such Benchmark with the applicable Unadjusted Benchmark Replacement for Dollar-denominated syndicated credit facilities at such time.
"Benchmark Replacement Conforming Changes" means, with respect to any Benchmark Replacement, any technical, administrative, or operational changes (including changes to the definition of "Business Day," the definition of "U.S. Government Securities Business Day," the definition of "Interest Period," timing and frequency of determining rates and making payments of interest, timing of borrowing requests or prepayment, conversion or continuation notices, length of lookback periods, the applicability of breakage provisions, and other technical, administrative, or operational matters) that the Administrative Agent decides may be appropriate to reflect the adoption and implementation of such Benchmark Replacement and to permit the administration thereof by the Administrative Agent in a manner substantially consistent with market practice (or, if the Administrative Agent decides that adoption of any portion of such market practice is not administratively feasible or if the Administrative Agent determines that no market practice for the administration of such Benchmark Replacement exists, in such other manner of administration as the Administrative Agent decides is reasonably necessary in connection with the administration of this Agreement and the other Loan Documents).
"Benchmark Replacement Date" means the earliest to occur of the following events with respect to the then-current Benchmark: (a) in the case of clause (a) or (b) of the definition of "Benchmark Transition Event," the later of (i) the date of the public statement or publication of information referenced therein and (ii) the date on which the administrator of such Benchmark (or the published component used in the calculation thereof) permanently or indefinitely ceases to provide all Available Tenors of such Benchmark (or such component thereof), or (b) in the case of clause (c) of the definition of "Benchmark Transition Event," the first date on which such Benchmark (or the published component used in the calculation thereof) has been determined and announced by the regulatory supervisor for the administrator of such Benchmark to be no longer representative; provided that such non-representativeness will be determined by reference to the most recent statement or publication referenced in such clause (c) and even if any Available Tenor of such Benchmark (or such component thereof) continues to be provided on such date.
"Benchmark Transition Event" means the occurrence of one or more of the following events with respect to the then-current Benchmark: (a) a public statement or publication of information by or on behalf of the administrator of such Benchmark (or the published component used in the calculation thereof) announcing that such administrator has ceased or will cease to provide all Available Tenors of such Benchmark (or such component thereof), permanently or indefinitely, provided that, at the time of such statement or publication, there is no successor administrator that will continue to provide any Available Tenor of such Benchmark (or such component thereof); (b) a public statement or publication of information by the regulatory supervisor for the administrator of such Benchmark (or the published component used in the calculation thereof), the Federal Reserve Board, the Federal Reserve Bank of New York, an insolvency official with jurisdiction over the administrator for such Benchmark (or such component), a resolution authority with jurisdiction over the administrator for such Benchmark (or such component), or a court or an entity with similar insolvency or resolution authority over the administrator for such Benchmark (or such component), which states that the administrator of such Benchmark (or such component) has ceased or will cease to provide all Available Tenors of such Benchmark (or such component thereof) permanently or indefinitely, provided that, at the time of such statement or publication, there is no successor administrator that will continue to provide any Available Tenor of such Benchmark (or such component thereof); or (c) a public statement or publication of information by the regulatory supervisor for the administrator of such Benchmark (or the published component used in the calculation thereof) announcing that all Available Tenors of such Benchmark (or such component thereof) are no longer, or as of a specified future date will no longer be, representative.
"Board" means the Board of Governors of the Federal Reserve System of the United States of America.
"Borrower" means Verimark Hospitality Group Inc., a corporation organized and existing under the laws of the State of Delaware (EIN: 82-3741956; Delaware File No. 7291843).
"Borrowing Date" means the Closing Date.
"Borrowing Request" means a request by the Borrower for a Borrowing in accordance with Section 2.02, substantially in the form of Exhibit A or any other form approved by the Administrative Agent (including any form on an electronic platform or electronic transmission system as shall be approved by the Administrative Agent).
"Business Day" means any day that is not a Saturday, Sunday, or other day on which commercial banks in New York City are authorized or required by law to remain closed; provided that, when used in connection with a Term SOFR rate determination, the term "Business Day" shall also exclude any day on which the Securities Industry and Financial Markets Association recommends that the fixed income departments of its members be closed for the entire day for purposes of trading in United States government securities.
"Capital Lease" means, with respect to any Person, any lease of (or other arrangement conveying the right to use) any property (whether real, personal, or mixed) that is required to be classified and accounted for as a finance lease or capital lease on a balance sheet of such Person under GAAP.
"Cash Equivalents" means (a) direct obligations of, or obligations the principal of and interest on which are unconditionally guaranteed by, the United States of America (or by any agency thereof to the extent such obligations are backed by the full faith and credit of the United States of America), in each case maturing within one (1) year from the date of acquisition thereof, (b) investments in commercial paper maturing within two hundred seventy (270) days from the date of acquisition thereof and having, at such date of acquisition, the highest credit rating obtainable from S&P Global Ratings or Moody's Investors Service, Inc. (or any successor to either thereof), (c) investments in certificates of deposit, banker's acceptances, and time deposits maturing within one hundred eighty (180) days from the date of acquisition thereof, issued or guaranteed by or placed with, and money market deposit accounts issued or offered by, any domestic office of any commercial bank organized under the laws of the United States of America or any state thereof that has a combined capital and surplus and undivided profits of not less than $500,000,000, and (d) fully collateralized repurchase agreements with a term of not more than thirty (30) days for securities described in clause (a) above and entered into with a financial institution satisfying the criteria described in clause (c) above.
"Change of Control" means the occurrence of any of the following: (a) any "person" or "group" (as such terms are used in Sections 13(d) and 14(d) of the Securities Exchange Act of 1934, as amended) becomes the "beneficial owner" (as defined in Rules 13d-3 and 13d-5 under the Securities Exchange Act of 1934, as amended), directly or indirectly, of more than [●]% of the total voting power of all Equity Interests of the Borrower entitled to vote generally in the election of directors, (b) the Borrower ceases to directly or indirectly own, free and clear of all Liens (other than Permitted Liens), 100% of the Equity Interests of each Guarantor (other than directors' qualifying shares and other shares required to be held by Persons other than the Borrower or its Subsidiaries under applicable law), or (c) during any consecutive 24-month period, a majority of the members of the board of directors of the Borrower ceases to be composed of individuals (i) who were members of that board of directors on the first day of such period, (ii) whose election or nomination to that board of directors was approved by individuals referred to in clause (i) above constituting at the time of such election or nomination at least a majority of that board of directors, or (iii) whose election or nomination to that board of directors was approved by individuals referred to in clauses (i) and (ii) above constituting at the time of such election or nomination at least a majority of that board of directors.
"Closing Date" means [●], 2022.
"Collateral" means all property and assets of the Borrower and the Guarantors, whether real, personal, or mixed, tangible or intangible, now owned or hereafter acquired, in which a Lien is granted or purported to be granted pursuant to the Pledge and Security Agreement, the Mortgages, or any other Security Document.
"Collateral Agent" means Crescent Harbor Bank, N.A., a national banking association, in its capacity as collateral agent for the Secured Parties under the Loan Documents, together with its successors and assigns in such capacity.
"Commitment" means, with respect to each Lender, the commitment of such Lender to make its Term Loan hereunder as set forth opposite such Lender's name on Schedule 2.01 hereto or in the applicable Assignment and Assumption Agreement or Lender Accession Agreement pursuant to which such Lender shall have assumed its Commitment, as applicable, as such commitment may be reduced or increased from time to time pursuant to the terms hereof. The aggregate amount of the Commitments of all Lenders on the date hereof is Seven Hundred Million Dollars ($700,000,000).
"Compliance Certificate" means a certificate of a Responsible Officer of the Borrower substantially in the form of Exhibit B.
"Consolidated Interest Expense" means, for any period, the aggregate interest expense (including amortization of original issue discount and non-cash interest expense) of the Borrower and its Restricted Subsidiaries on a consolidated basis for such period, determined in accordance with GAAP, including (a) all commissions, discounts, and other fees and charges owed with respect to letters of credit and bankers' acceptance financing, (b) the interest component of Capital Lease obligations, and (c) net costs under Swap Contracts.
"Consolidated Net Income" means, for any period, the net income (or loss) of the Borrower and its Restricted Subsidiaries on a consolidated basis for such period, determined in accordance with GAAP; provided that there shall be excluded from Consolidated Net Income (a) extraordinary gains and losses, (b) non-cash gains and losses from sales, exchanges, or other dispositions of assets other than in the ordinary course of business, (c) any income (or loss) from discontinued operations, (d) the cumulative effect of a change in accounting principles during such period, (e) any income (or loss) of any Person (other than a Restricted Subsidiary of the Borrower) in which the Borrower or any Restricted Subsidiary has an ownership interest, except to the extent of the amount of dividends or distributions actually paid in cash to the Borrower or any Restricted Subsidiary, and (f) any non-cash compensation charge or expense arising from any grant of stock, stock options, restricted stock units, or other equity-based awards.
"Consolidated Total Debt" means, as of any date of determination, the aggregate principal amount of all Indebtedness of the Borrower and its Restricted Subsidiaries outstanding on such date, determined on a consolidated basis in accordance with GAAP.
"Control" means the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of a Person, whether through the ability to exercise voting power, by contract, or otherwise. "Controlling" and "Controlled" have meanings correlative thereto.
"CUSIP" means the Committee on Uniform Security Identification Procedures number assigned to the Term Loans, which is 92347LAB8.
"Daily Simple SOFR" means, for any day (a "SOFR Rate Day"), a rate per annum equal to SOFR for the day that is five (5) U.S. Government Securities Business Days prior to (i) if such SOFR Rate Day is a U.S. Government Securities Business Day, such SOFR Rate Day, or (ii) if such SOFR Rate Day is not a U.S. Government Securities Business Day, the U.S. Government Securities Business Day immediately preceding such SOFR Rate Day, in each case, as SOFR for any day is published by the SOFR Administrator on the SOFR Administrator's Website.
"Default" means any Event of Default or any event, act, or condition that, with the giving of notice, the lapse of time, or both, would constitute an Event of Default.
"Default Rate" means an interest rate per annum equal to the Applicable Rate then in effect plus 2.00% (200 basis points) per annum.
"Disqualified Lender" means (a) each Person designated by the Borrower to the Administrative Agent in writing on or prior to the Closing Date (or, with respect to updates, from time to time after the Closing Date), and (b) as to any Person described in clause (a), any of such Person's known Affiliates that are readily identifiable solely on the basis of the similarity of name; provided that the term "Disqualified Lender" shall not include any Person that is a bona fide debt fund or investment vehicle that is engaged in making, purchasing, holding, or otherwise investing in commercial loans and bonds in the ordinary course of its business, notwithstanding that such Person may be an Affiliate of a Person described in clause (a) above.
"Dollar" and the sign "$" mean lawful money of the United States of America.
"Eligible Assignee" means any Person that meets the requirements to be an assignee under Section 10.05(b) (subject to such consents, if any, as may be required under Section 10.05(b)); provided that no Disqualified Lender shall be an Eligible Assignee.
"Environmental Laws" means all laws, rules, regulations, codes, ordinances, orders, decrees, judgments, injunctions, or binding agreements issued, promulgated, or entered into by any Governmental Authority, relating in any way to the environment, preservation or reclamation of natural resources, the management, release, or threatened release of any Hazardous Material, or to health and safety matters.
"Equity Interests" means, with respect to any Person, all of the shares of capital stock of (or other ownership or profit interests in) such Person, all of the warrants, options, or other rights for the purchase or acquisition from such Person of shares of capital stock of (or other ownership or profit interests in) such Person, all of the securities convertible into or exchangeable for shares of capital stock of (or other ownership or profit interests in) such Person or warrants, rights, or options for the purchase or acquisition from such Person of such shares (or such other interests), and all of the other ownership or profit interests in such Person (including partnership, member, or trust interests therein), whether voting or nonvoting, and whether or not such shares, warrants, options, rights, or other interests are outstanding on any date of determination.
"ERISA" means the Employee Retirement Income Security Act of 1974, as amended from time to time.
"ERISA Affiliate" means any trade or business (whether or not incorporated) that, together with the Borrower, is treated as a single employer under Section 414(b) or (c) of the Code, or, solely for purposes of Section 302 of ERISA and Section 412 of the Code, is treated as a single employer under Section 414 of the Code.
"ERISA Event" means (a) any "reportable event," as defined in Section 4043 of ERISA or the regulations issued thereunder, with respect to a Plan (other than events for which the 30-day notice period is waived), (b) the failure to satisfy the "minimum funding standard" (as defined in Section 412 of the Code or Section 302 of ERISA), whether or not waived, (c) the filing pursuant to Section 412(c) of the Code or Section 302(c) of ERISA of an application for a waiver of the minimum funding standard with respect to any Plan, (d) a determination that any Plan is, or is expected to be, in "at risk" status (as defined in Section 430 of the Code or Section 303 of ERISA), (e) the incurrence by the Borrower or any ERISA Affiliate of any liability under Title IV of ERISA with respect to the termination of any Plan, (f) the receipt by the Borrower or any ERISA Affiliate from the PBGC or a plan administrator of any notice relating to an intention to terminate any Plan or Plans or to appoint a trustee to administer any Plan, (g) the incurrence by the Borrower or any ERISA Affiliate of any liability with respect to the withdrawal or partial withdrawal from any Plan or Multiemployer Plan, or (h) the receipt by the Borrower or any ERISA Affiliate of any notice, or the receipt by any Multiemployer Plan from the Borrower or any ERISA Affiliate of any notice, concerning the imposition of Withdrawal Liability or a determination that a Multiemployer Plan is, or is expected to be, insolvent or in reorganization, within the meaning of Title IV of ERISA.
"Event of Default" has the meaning set forth in Section 8.01.
"Excess Cash Flow" means, for any fiscal year of the Borrower, Adjusted EBITDA for such fiscal year minus (a) the sum of (i) cash interest expense paid during such fiscal year (excluding amounts paid with the proceeds of Indebtedness), (ii) scheduled principal payments on the Term Loans actually made during such fiscal year pursuant to Section 2.05(a), (iii) cash income taxes paid during such fiscal year, (iv) Capital Expenditures made in cash during such fiscal year (to the extent not financed with the proceeds of Indebtedness), (v) any voluntary prepayments of the Term Loans pursuant to Section 2.11(a) actually made during such fiscal year (to the extent not financed with the proceeds of Indebtedness), and (vi) net increases in working capital during such fiscal year, plus (b) net decreases in working capital during such fiscal year.
"Existing RCF" means the $400,000,000 senior secured revolving credit facility, dated as of February 14, 2020 (as amended, restated, supplemented, or otherwise modified from time to time), among the Borrower, the guarantors party thereto, the lenders party thereto, and Crescent Harbor Bank, N.A., as administrative agent.
"Existing Term Loan Facility" means the existing $625,000,000 Term Loan B credit facility, originally dated as of February 14, 2020 (as amended, restated, supplemented, or otherwise modified from time to time), among the Borrower, the guarantors party thereto, the lenders party thereto, and Greystone Federal Credit Corp., as administrative agent (CUSIP: 92347LAA0).
"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 or official interpretations thereof, any agreements entered into pursuant to Section 1471(b)(1) of the Code, and any fiscal or regulatory legislation, rules, or practices adopted pursuant to any intergovernmental agreement, treaty, or convention among Governmental Authorities entered into in connection with the implementation of the foregoing.
"Federal Reserve Bank of New York's Website" means the website of the Federal Reserve Bank of New York at http://www.newyorkfed.org, or any successor source.
"Fee Letter" means the Fee Letter, dated as of the date of the Commitment Letter, between the Borrower and Crescent Harbor Bank, N.A., in its capacity as Lead Arranger and Bookrunner, as amended, restated, or otherwise modified from time to time.
"First Lien Intercreditor Agreement" means the Amended and Restated Intercreditor Agreement, dated as of the Closing Date, among the Administrative Agent (in its capacity as TLB Agent and RCF Agent), the Borrower, and the other parties thereto, as amended, restated, supplemented, or otherwise modified from time to time.
"Floor" means a rate of interest per annum equal to 0.50% (50 basis points).
"GAAP" means generally accepted accounting principles in the United States of America as in effect from time to time, subject to Section 1.03.
"Governmental Authority" means the government of the United States of America or any other nation, or of any political subdivision thereof, whether state or local, and any agency, authority, instrumentality, regulatory body, court, central bank, or other entity exercising executive, legislative, judicial, taxing, regulatory, or administrative powers or functions of or pertaining to government.
"Guarantee Agreement" means the Guarantee Agreement, dated as of the Closing Date, made by the Guarantors in favor of the Administrative Agent for the benefit of the Secured Parties, substantially in the form agreed upon by the parties hereto, as such agreement may be amended, restated, supplemented, or otherwise modified from time to time.
"Guarantors" means (a) Verimark Resort Properties LLC, a Delaware limited liability company, (b) VHG Management Services Inc., a Delaware corporation, (c) Verimark Convention Holdings LLC, a Delaware limited liability company, (d) Palmetto Beachfront Hotels LLC, a Florida limited liability company, (e) Cascadia Hospitality Corp., a Delaware corporation, and (f) each other Subsidiary that becomes a Guarantor pursuant to Section 5.12, in each case, until such time as such Person's guarantee of the Secured Obligations is released in accordance with the terms of the Guarantee Agreement.
"Hazardous Material" means all explosive or radioactive substances or wastes and all hazardous or toxic substances, wastes, or other pollutants, including petroleum or petroleum distillates, asbestos or asbestos-containing materials, polychlorinated biphenyls, radon gas, infectious or medical wastes, and all other substances or wastes of any nature regulated pursuant to any Environmental Law.
"Incremental Term Loans" has the meaning set forth in Section 2.20.
"Indebtedness" means, with respect to any Person, without duplication, (a) all obligations of such Person for borrowed money, (b) all obligations of such Person evidenced by bonds, debentures, notes, or similar instruments, (c) all obligations of such Person under conditional sale or other title retention agreements relating to property acquired by such Person, (d) all obligations of such Person in respect of the deferred purchase price of property or services (other than current trade payables incurred in the ordinary course of business), (e) all Indebtedness of others secured by (or for which the holder of such Indebtedness has an existing right, contingent or otherwise, to be secured by) any Lien on property owned or acquired by such Person, whether or not the Indebtedness secured thereby has been assumed, (f) all guarantees by such Person of Indebtedness of others, (g) all Capital Lease obligations of such Person, (h) all obligations of such Person in respect of bankers' acceptances, (i) all obligations of such Person as an account party in respect of letters of credit and letters of guaranty, and (j) all obligations of such Person in respect of Swap Contracts.
"Interest Period" means, with respect to any Term Loan, (a) initially, the period commencing on the Closing Date and ending on the last day of the calendar month in which the Closing Date occurs (or if the Closing Date is the last day of a calendar month, ending on the numerically corresponding day in the next succeeding calendar month that is one (1), three (3), or six (6) months after the Closing Date, as selected by the Borrower), and (b) thereafter, each period commencing on the last day of the immediately preceding Interest Period and ending on the numerically corresponding day in the calendar month that is one (1), three (3), or six (6) months thereafter, as selected by the Borrower in its Borrowing Request or interest period selection notice; provided that (i) if any Interest Period would end on a day other than a Business Day, such Interest Period shall be extended to the next succeeding Business Day unless such next succeeding Business Day would fall in the next calendar month, in which case such Interest Period shall end on the next preceding Business Day, (ii) any Interest Period that commences on the last Business Day of a calendar month (or on a day for which there is no numerically corresponding day in the last month of such Interest Period) shall end on the last Business Day of the last month of such Interest Period, and (iii) no Interest Period shall extend beyond the Maturity Date.
"Lead Arranger" means Crescent Harbor Bank, N.A., in its capacity as sole lead arranger and sole bookrunner.
"Lender" means each financial institution listed on Schedule 2.01 hereto (other than any such financial institution that has ceased to be a party hereto pursuant to an Assignment and Assumption Agreement) and any Eligible Assignee that has become a party hereto pursuant to an Assignment and Assumption Agreement or a Lender Accession Agreement.
"Lender Accession Agreement" means a Lender Accession Agreement substantially in the form of Exhibit F.
"Lien" means, with respect to any asset, (a) any mortgage, deed of trust, lien, pledge, hypothecation, encumbrance, charge, or security interest in, on, or of such asset, (b) the interest of a vendor or a lessor under any conditional sale agreement, capital lease, or title retention agreement (or any financing lease having substantially the same economic effect as any of the foregoing) relating to such asset, and (c) in the case of securities, any purchase option, call, or similar right of a third party with respect to such securities.
"Loan Documents" means this Agreement, the Guarantee Agreement, the Pledge and Security Agreement, the Mortgages, the First Lien Intercreditor Agreement, the Notes, each Lender Accession Agreement, each Assignment and Assumption Agreement, and each other document, instrument, or agreement delivered in connection with any of the foregoing.
"Loan Party" means the Borrower and each Guarantor.
"Material Adverse Effect" means a material adverse effect on (a) the business, assets, operations, or financial condition of the Borrower and its Subsidiaries taken as a whole, (b) the ability of any Loan Party to perform any of its material obligations under any Loan Document to which it is a party, or (c) the rights of or benefits available to the Administrative Agent or the Lenders under the Loan Documents, including the validity or enforceability of any Loan Document or the perfection or priority of any Lien granted thereunder.
"Material Subsidiary" means each Subsidiary of the Borrower that, as of the last day of the most recently ended fiscal quarter for which financial statements have been delivered pursuant to Section 5.01, had total assets with a book value in excess of 5.0% of the total consolidated assets of the Borrower and its Subsidiaries or revenues representing more than 5.0% of the total consolidated revenues of the Borrower and its Subsidiaries.
"Maturity Date" means the date that is seven (7) years after the Closing Date; provided that if such date is not a Business Day, the Maturity Date shall be the immediately preceding Business Day.
"MFN Protection" has the meaning set forth in Section 2.20(b).
"MFN Sunset Date" means the date that is eighteen (18) months after the Closing Date.
"MFN Threshold" means 50 basis points (0.50%).
"Mortgaged Properties" means the 42 hotel properties owned by Verimark Resort Properties LLC, Palmetto Beachfront Hotels LLC, and the other Guarantors that are subject to Mortgages in favor of the Collateral Agent, located across the following states: Florida (12 properties), New York (6 properties), California (5 properties), Texas (4 properties), Georgia (3 properties), Colorado (3 properties), Arizona (2 properties), Illinois (2 properties), Washington (2 properties), Oregon (1 property), Nevada (1 property), and Virginia (1 property), which Mortgaged Properties have an aggregate appraised value of approximately $2,180,000,000 as of the date hereof.
"Mortgages" means the mortgages, deeds of trust, deeds to secure debt, and similar instruments executed and delivered by the Loan Parties in favor of the Collateral Agent for the benefit of the Secured Parties, with respect to the Mortgaged Properties.
"Net Proceeds" means, with respect to any Asset Sale or casualty or condemnation event, the aggregate cash proceeds and Cash Equivalents received by the Borrower or any of its Restricted Subsidiaries in connection therewith, net of (a) the direct costs relating to such event (including legal, accounting, investment banking, and brokerage fees, and sales commissions), (b) taxes paid or reasonably estimated to be payable as a result thereof (after taking into account any available tax credits or deductions and any tax sharing arrangements), (c) amounts required to be applied to the repayment of Indebtedness (other than the Term Loans) secured by a Lien on the asset or assets that were the subject of such event, and (d) any reserve for adjustment in respect of (i) the sale price of such asset established in accordance with GAAP, and (ii) any liabilities associated with such asset and retained by the Borrower or any Restricted Subsidiary after such sale or other disposition thereof, including pension and other post-employment benefit liabilities and liabilities related to Environmental Laws, in each case as determined by the Borrower in good faith.
"Notes" means the promissory notes, if any, issued by the Borrower pursuant to Section 2.09(c), substantially in the form of Exhibit D.
"Obligations" means all advances to, and debts, liabilities, obligations, covenants, and duties of, any Loan Party arising under any Loan Document, 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 Law naming such Person as the debtor in such proceeding, regardless of whether such interest and fees are allowed claims in such proceeding.
"Officer's Closing Certificate" means a certificate of a Responsible Officer of the Borrower substantially in the form of Exhibit G.
"Original Issue discount" or "OID" means 1.00% of the aggregate principal amount of the Term Loans ($7,000,000), such that the Term Loans shall be funded at 99.00% of par.
"Perfection Certificate" means a certificate in form and substance satisfactory to the Collateral Agent setting forth the information required for the perfection of the security interests granted under the Security Documents.
"Permitted Acquisition" means any acquisition by the Borrower or any Restricted Subsidiary of all or substantially all the assets of, or all or substantially all the Equity Interests in, a Person or division or business unit of a Person; provided that (a) no Default or Event of Default shall have occurred and be continuing at the time of, or would result from, such acquisition, (b) after giving pro forma effect to such acquisition, the Borrower is in compliance with the financial covenant set forth in Section 7.01 (to the extent tested), (c) such acquisition is consummated in compliance with all applicable laws, and (d) the Borrower shall have delivered to the Administrative Agent a pro forma Compliance Certificate demonstrating compliance with the foregoing.
"Permitted Indebtedness" has the meaning set forth in Section 6.01.
"Permitted Liens" has the meaning set forth in Section 6.02.
"Person" means any natural person, corporation, limited liability company, trust, joint venture, association, company, partnership, Governmental Authority, or other entity.
"Plan" means any "employee benefit plan" (as defined in Section 3(3) of ERISA) that is maintained or contributed to by the Borrower or any ERISA Affiliate, or for which the Borrower or any ERISA Affiliate has any liability.
"Pledge and Security Agreement" means the Pledge and Security Agreement, dated as of the Closing Date, among the Loan Parties and the Collateral Agent, as such agreement may be amended, restated, supplemented, or otherwise modified from time to time.
"Repricing Event" means (a) any prepayment or refinancing of all or any portion of the Term Loans in connection with, or substantially concurrently with, any new or replacement term loan indebtedness bearing interest at an effective yield (as reasonably determined by the Administrative Agent) that is lower than the effective yield on the Term Loans so prepaid or refinanced, or (b) any amendment to this Agreement that reduces the Applicable Margin or the effective yield applicable to the Term Loans; provided that a Repricing Event shall not include any prepayment or refinancing of the Term Loans made in connection with (i) a Change of Control, (ii) a transformative acquisition, or (iii) any other transaction that is not primarily intended to lower the effective yield on the Term Loans.
"Repricing Protection Period" means the period from and including the Closing Date to and including the date that is six (6) months after the Closing Date.
"Required Lenders" means, at any time, Lenders having Term Loans representing more than 50% of the aggregate outstanding principal amount of all Term Loans at such time; provided that the Term Loans of any Defaulting Lender shall be excluded from the determination of Required Lenders at any time.
"Responsible Officer" means the chief executive officer, the president, the chief financial officer, the treasurer, the assistant treasurer, or the general counsel of the Borrower, and solely for purposes of notices given pursuant to Article II, any other officer or employee of the Borrower so designated by any of the foregoing officers in a notice to the Administrative Agent. Any document delivered hereunder that is signed by a Responsible Officer of the Borrower shall be conclusively presumed to have been authorized by all necessary corporate, partnership, and/or other action on the part of the Borrower and such Responsible Officer shall be conclusively presumed to have acted on behalf of the Borrower.
"Restricted Payment" means any dividend or other distribution (whether in cash, securities, or other property) with respect to any Equity Interests of the Borrower or any Restricted Subsidiary, or any payment (whether in cash, securities, or other property), including any sinking fund or similar deposit, on account of the purchase, redemption, retirement, defeasance, acquisition, cancellation, or termination of any such Equity Interests, or on account of any return of capital to the Borrower's stockholders, partners, or members (or the equivalent Persons thereof).
"Restricted Subsidiary" means any Subsidiary of the Borrower that is not an Unrestricted Subsidiary.
"Sanctioned Country" means, at any time, a country, region, or territory that is itself the subject or target of any comprehensive Sanctions (at the time of this Agreement, Cuba, Iran, North Korea, Syria, and the Crimea, Donetsk People's Republic, and Luhansk People's Republic regions of Ukraine).
"Sanctioned Person" means, at any time, (a) any Person listed in any Sanctions-related list of designated Persons maintained by OFAC, the U.S. Department of State, or the United Nations Security Council, (b) any Person operating, organized, or resident in a Sanctioned Country, (c) any Person owned or controlled by any such Person or Persons described in the foregoing clauses (a) or (b), or (d) any Person otherwise the target of Sanctions.
"Sanctions" means all economic or financial sanctions or trade embargoes imposed, administered, or enforced from time to time by (a) the U.S. government, including those administered by OFAC or the U.S. Department of State, or (b) the United Nations Security Council, the European Union, or Her Majesty's Treasury of the United Kingdom.
"Secured Obligations" means the Obligations.
"Secured Parties" means, collectively, the Administrative Agent, the Collateral Agent, and the Lenders.
"Secretary's Certificate" means a certificate of the secretary or assistant secretary (or equivalent officer) of a Loan Party substantially in the form of Exhibit H.
"SOFR" means a rate equal to the secured overnight financing rate as administered by the SOFR Administrator.
"SOFR Adjustment" means (a) 0.10% (10 basis points) with respect to a one-month Interest Period, (b) 0.15% (15 basis points) with respect to a three-month Interest Period, and (c) 0.25% (25 basis points) with respect to a six-month Interest Period.
"SOFR Administrator" means the Federal Reserve Bank of New York (or a successor administrator of the secured overnight financing rate).
"SOFR Administrator's Website" means the website of the Federal Reserve Bank of New York, currently at http://www.newyorkfed.org (or any successor source for the secured overnight financing rate identified as such by the SOFR Administrator from time to time).
"Solvent" means, with respect to any Person as of any date of determination, that as of such date (a) the sum of the debts and liabilities (including contingent liabilities) of such Person and its Subsidiaries, taken as a whole, does not exceed the fair value of the assets of such Person and its Subsidiaries, taken as a whole, (b) the present fair saleable value of the assets of such Person and its Subsidiaries, taken as a whole, is not less than the amount that will be required to pay the probable liability on such Person's and its Subsidiaries' existing debts and liabilities (including contingent liabilities) as they become absolute and matured, (c) such Person and its Subsidiaries, taken as a whole, do not intend to, and do not believe that they will, incur debts or liabilities beyond their ability to pay as such debts and liabilities mature, and (d) such Person and its Subsidiaries, taken as a whole, are not engaged in a business or a transaction, and are not about to engage in a business or a transaction, for which their assets would constitute unreasonably small capital.
"Solvency Certificate" means a certificate of the Chief Financial Officer of the Borrower substantially in the form of Exhibit C.
"Subsidiary" means, with respect to any Person (the "parent"), any corporation, partnership, joint venture, limited liability company, or other business entity of which a majority of the shares of Equity Interests having ordinary voting power for the election of directors, managers, or other governing body (other than securities or interests having such power only by reason of the happening of a contingency) are at the time beneficially owned, or the management of which is otherwise controlled, directly, or indirectly through one or more intermediaries, or both, by such parent.
"Swap Contract" means (a) any and all rate swap transactions, basis swaps, credit derivative transactions, forward rate transactions, commodity swaps, commodity options, forward commodity contracts, equity or equity index swaps or options, bond or bond price or bond index swaps or options or forward bond or forward bond price or forward bond index transactions, interest rate options, forward foreign exchange transactions, cap transactions, floor transactions, collar transactions, currency swap transactions, cross-currency rate swap transactions, currency options, spot contracts, or any other similar transactions or any combination of any of the foregoing (including any options to enter into any of the foregoing), whether or not any such transaction is governed by or subject to any master agreement, and (b) any and all transactions of any kind, and the related confirmations, that are subject to the terms and conditions of, or governed by, any form of master agreement published by the International Swaps and Derivatives Association, Inc., any International Foreign Exchange Master Agreement, or any other master agreement.
"Term Loan" or "Term Loans" means the term loans made by the Lenders to the Borrower pursuant to Section 2.01 on the Closing Date, in the aggregate principal amount of Seven Hundred Million Dollars ($700,000,000).
"Term SOFR" means, for the applicable Corresponding Tenor as of the applicable Reference Time, the forward-looking term rate based on SOFR that has been selected by the Administrative Agent and is published by the CME Group Benchmark Administration Ltd. (or a successor administrator satisfactory to the Administrative Agent); provided that if as of 5:00 p.m. (New York City time) on any day that is two (2) U.S. Government Securities Business Days preceding the first day of any Interest Period, the Term SOFR for the applicable Corresponding Tenor has not been published by the CME Group Benchmark Administration Ltd. (or a successor administrator) and a Benchmark Replacement Date with respect to the Term SOFR has not occurred, then Term SOFR will be the Term SOFR as published for such tenor as of such Reference Time for the first preceding U.S. Government Securities Business Day for which Term SOFR for such tenor was published by the CME Group Benchmark Administration Ltd. (or a successor administrator), so long as such first preceding U.S. Government Securities Business Day is not more than three (3) U.S. Government Securities Business Days prior to such Reference Time.
"Total Net Leverage Ratio" means, as of any date of determination, the ratio of (a) Consolidated Total Debt as of such date minus unrestricted cash and Cash Equivalents of the Borrower and its Restricted Subsidiaries as of such date (in an aggregate amount not to exceed $[●]) to (b) Adjusted EBITDA for the most recently ended period of four (4) consecutive fiscal quarters of the Borrower for which financial statements have been delivered pursuant to Section 5.01 (or, for any determination prior to the delivery of the first set of financial statements after the Closing Date, the period of four consecutive fiscal quarters most recently ended prior to the Closing Date). For the avoidance of doubt, the pro forma Total Net Leverage Ratio as of the Closing Date (after giving effect to the transactions contemplated hereby) is approximately 2.52 to 1.00 ($858,000,000 in net debt divided by $341,000,000 in LTM Adjusted EBITDA).
"Unrestricted Subsidiary" means any Subsidiary of the Borrower designated by the Borrower as an "Unrestricted Subsidiary" in accordance with Section 6.01, after the Closing Date.
"U.S. Government Securities Business Day" means any day except for (a) a Saturday, (b) a Sunday, or (c) a day on which the Securities Industry and Financial Markets Association recommends that the fixed income departments of its members be closed for the entire day for purposes of trading in United States government securities.
Section 1.02 — Other Interpretive Provisions
With reference to this Agreement and each other Loan Document, unless otherwise specified herein or in such other Loan Document:
(a) The definitions of terms herein shall apply equally to the singular and plural forms of the terms defined. Whenever the context may require, any pronoun shall include the corresponding masculine, feminine, and neuter forms. The words "include," "includes," and "including" shall be deemed to be followed by the phrase "without limitation." The word "will" shall be construed to have the same meaning and effect as the word "shall." Unless the context requires otherwise, (i) any definition of or reference to any agreement, instrument, or other document herein (including this Agreement) shall be construed as referring to such agreement, instrument, or other document as from time to time amended, supplemented, restated, or otherwise modified (subject to any restrictions on such amendments, supplements, restatements, or modifications set forth herein or in any other Loan Document), (ii) any reference herein to any Person shall be construed to include such Person's successors and assigns, (iii) the words "herein," "hereof," and "hereunder," and words of similar import when used in any Loan Document shall be construed to refer to such Loan Document in its entirety and not to any particular provision thereof, (iv) all references in a Loan Document to Articles, Sections, Exhibits, and Schedules shall be construed to refer to Articles and Sections of, and Exhibits and Schedules to, the Loan Document in which such references appear, (v) any reference to any law shall include all statutory and regulatory provisions consolidating, amending, replacing, or interpreting such law and any reference to any law or regulation shall, unless otherwise specified, refer to such law or regulation as amended, modified, or supplemented from time to time, and (vi) the words "asset" and "property" shall be construed to have the same meaning and effect and to refer to any and all tangible and intangible assets and properties, including cash, securities, accounts, and contract rights.
(b) In the computation of periods of time from a specified date to a later specified date, the word "from" means "from and including" and the words "to" and "until" each mean "to but excluding."
(c) Section headings herein and in the other Loan Documents are included herein for convenience of reference only and shall not affect the interpretation of this Agreement or any other Loan Document.
(d) In the event of any conflict between the terms of this Agreement and any other Loan Document, the terms of this Agreement shall control (except with respect to the First Lien Intercreditor Agreement, which shall control in the event of any conflict with this Agreement as it relates to intercreditor matters, and except as otherwise expressly provided in the applicable Loan Document with the consent of the Administrative Agent).
Section 1.03 — Accounting Terms
(a) All accounting terms not specifically or completely defined herein shall be construed in conformity with, and all financial data (including financial ratios and other financial calculations) required to be submitted pursuant to this Agreement shall be prepared in conformity with, GAAP as in effect from time to time, applied in a manner consistent with that used in preparing the audited financial statements referred to in Section 4.04, except as otherwise specifically prescribed herein.
(b) Notwithstanding any other provision contained herein, all terms of an accounting or financial nature used herein shall be construed, and all computations of amounts and ratios referred to herein shall be made, without giving effect to any election under Accounting Standards Codification Topic 825 — Financial Instruments (or any other Accounting Standards Codification or Financial Accounting Standard having a similar result or effect) to value any Indebtedness or other liabilities of the Borrower or any Subsidiary at "fair value," as defined therein.
(c) If at any time any change in GAAP would affect the computation of any financial ratio or requirement set forth in any Loan Document, and either the Borrower or the Required Lenders shall so request, the Administrative Agent, the Lenders, and the Borrower shall negotiate in good faith to amend such ratio or requirement to preserve the original intent thereof in light of such change in GAAP (subject to the approval of the Required Lenders); provided that, until so amended, (i) such ratio or requirement shall continue to be computed in accordance with GAAP prior to such change therein, and (ii) the Borrower shall provide to the Administrative Agent and the Lenders financial statements and other documents required under this Agreement or as reasonably requested hereunder setting forth a reconciliation between calculations of such ratio or requirement made before and after giving effect to such change in GAAP (the "Frozen GAAP Election").
(d) For the avoidance of doubt, the Borrower's audited financial statements have been prepared by Clearmont & Wharton LLP (Ronald Ashby, engagement partner), an independent registered public accounting firm, in accordance with GAAP.
Section 1.04 — Rounding
Any financial ratios required to be maintained by the Borrower pursuant to this Agreement shall be calculated by dividing the appropriate component by the other component, carrying the result to one place more than the number of places by which such ratio is expressed herein, and rounding the result up or down to the nearest number (with a rounding-up if there is no nearest number). All financial calculations made pursuant to this Agreement shall be rounded to the nearest one-hundredth (1/100th).
Section 1.05 — Times of Day
Unless otherwise specified, all references herein to times of day shall be references to New York City time (Eastern Time).
Section 1.06 — Letter of Credit Amounts
[Reserved.]
Section 1.07 — SOFR Matters
(a) The Administrative Agent does not warrant, nor accept responsibility for, nor shall the Administrative Agent have any liability with respect to, (i) the continuation of, administration of, submission of, calculation of, or any other matter related to the Benchmark, any component definition thereof, or rates referenced in the defi

PRIVILEGED AND CONFIDENTIAL ATTORNEY WORK PRODUCT DRAFT — FOR DISCUSSION PURPOSES ONLY

CREDIT AGREEMENT

VERIMARK HOSPITALITY GROUP INC.

THE GUARANTORS PARTY HERETO,

THE LENDERS PARTY HERETO,

CRESCENT HARBOR BANK, N.A.

TABLE OF CONTENTS

CREDIT AGREEMENT

RECITALS

Record

Parties

Dates

Amounts