United states securities and exchange commission



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Hazardous Material ” means petroleum, petroleum hydrocarbons or petroleum products, petroleum by-products, radioactive materials, asbestos or asbestos-containing materials, gasoline, diesel fuel, pesticides, radon, urea formaldehyde, mold, lead or lead-containing materials, polychlorinated biphenyls; and any other chemicals, materials, substances or wastes in any amount or concentration which are now or hereafter (a) become defined as or included in the definition of “hazardous substances,” “hazardous materials,” “hazardous wastes,” “extremely hazardous wastes,” “restricted hazardous wastes,” “toxic substances,” “toxic pollutants,” “pollutants,” “regulated substances,” “solid wastes,” or “contaminants” or words of similar import, under any Environmental Law or (b) are regulated by or for which Liability can be imposed under any Environmental Law.

Immaterial Subsidiary ” shall mean (a) a Subsidiary which has (i) assets with a fair market value of less than $1,000,000 and annual revenues of less than $1,000,000, and (ii) together with all other Immaterial Subsidiaries, aggregate assets with a fair market value of less than $5,000,000 and aggregate annual revenues of less than $5,000,000, in each case of clause (i) and (ii) above, calculated on the basis of the latest financial statements delivered by the Borrower to the Lenders pursuant to Section 5.1(a) or (b), as the case may be; provided that in the case of a material transfer of assets to any such Subsidiary, the fair market value of such assets shall be calculated on the date of such transfer on the basis of the fair market value of such assets as reasonably determined in good faith by the Borrower until such time as financial statements reflecting such

transfer of assets are delivered by the Borrower to the Lenders pursuant to Section 5.1(a) or (b), as the case may be, or (b) a Subsidiary otherwise determined by the Administrative Agent to be immaterial pursuant to Section 12.1(b)(ii) hereof.

Indebtedness ” shall mean (without double counting), at any time and with respect to any Person, (i) indebtedness of such Person for borrowed money (whether by loan or the issuance and sale of debt securities) or for the deferred purchase price of property or services purchased (other than (x) amounts constituting trade payables (payable within one hundred twenty (120) days or such longer term as may be customary in the industry), or (y) other amounts due for the rental of space in connection with the production of a Picture, in each case arising in the ordinary course of business), (ii) obligations of such Person in respect of letters of credit, acceptance facilities, or drafts or similar instruments issued or accepted by banks and other financial institutions for the account of such Person, (iii) obligations of such Person under Capital Leases and any financing lease involving substantially the same economic effect, (iv) deferred payment obligations of such Person resulting from the adjudication or settlement of any litigation to the extent not already reflected as a current liability on the balance sheet of such Person, and (v) indebtedness of others of the type described in clauses (i) through (iv) hereof which such Person has (a) directly or indirectly assumed or guaranteed in connection with a Guaranty, or (b) secured by a Lien on the assets of such Person, whether or not such Person has assumed such indebtedness; provided , that Indebtedness shall not include any non refundable advance made to a Credit Party by a third party Distributor in connection with the production, distribution or sale of any Picture.

Indemnified Party ” shall have the meaning given to such term in Section 13.5.

Indemnified Taxes ” shall mean Taxes other than Excluded Taxes and Other Taxes.

Information ” shall have the meaning given to such term in Section 13.18.

Initial 2012 Credit Agreement ” shall have the meaning given to such term in the Introductory Statement hereof.

Initial Date ” shall mean (i) in the case of the Administrative Agent, the Closing Date, (ii) in the case of each Initial 2012 Lender, the Closing Date, and (iii) in the case of any other Lender, the effective date on which it became a Lender pursuant to an Assignment and Assumption.

Initial 2012 Lenders ” shall have the meaning given to such term in the Introductory Statement hereof.

Instrument of Assumption and Joinder ” shall mean an Instrument of Assumption and Joinder substantially in the form of Exhibit H .

Interest Deficit ” shall have the meaning given to such term in Section 2.12(a).

Interest Payment Date ” shall mean (i) as to any LIBOR Loan having an Interest Period of one (1), two (2) or three (3) months, the last day of such Interest Period, (ii) as to any LIBOR Loan having an Interest Period of more than three (3) months, the last day of such Interest


Period and, in addition, each date during such Interest Period occurring at three-month intervals after the first day of such Interest Period, and (iii) with respect to any Alternate Base Rate Loan, the last day of each March, June, September and December (commencing March 31, 2012).

Interest Period ” shall mean as to any LIBOR Loan, the period commencing on the date such Loan is made, continued or converted, and ending on the numerically corresponding day (or if there is no corresponding day, the last day) in the calendar month that is one (1), two (2), three (3), six (6), nine (9) or twelve (12) months; provided , however , that (i) if any Interest Period would end on a day which shall not be 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, and (ii) no Interest Period may be selected which would end later than the Maturity Date.

Interparty Agreement ” shall mean, with respect to a Picture, an interparty agreement, as such agreement may be amended, supplemented or otherwise modified, renewed or replaced from time to time, among, (i) the Administrative Agent, (ii) the relevant Credit Party, (iii) the relevant Distributor, (iv) the Approved Completion Guarantor, (v) with respect to a Picture that is financed in part by a Foreign Rights Loan, the Foreign Rights Agent, (vi) if such Picture is a Co-Financed Picture, the Approved Co-Financier and (vii) any other appropriate Person which agreement (a) is necessary in the reasonable judgment of the Administrative Agent to (x) if applicable, allocate the risks of Completion and delivery of such Picture and/or (y) address respective funding obligations if any portion of the Negative Cost in respect of such Picture not being contributed by a Credit Party is to be funded during the course of production or upon Completion of such Picture, and (b) shall otherwise be in form and substance reasonably satisfactory to the Administrative Agent.


Investment ” shall mean any stock, evidence of indebtedness or other securities of any Person, any loan, advance, contribution of capital, extension of credit or commitment therefor (including, without limitation, the Guaranty of loans made to others, but excluding current trade and customer accounts receivable arising in the ordinary course of business and payable in accordance with customary trading terms in the ordinary course of business), any purchase of (i) any Equity Interests of another Person, or (ii) any business or undertaking of any Person or any commitment to make any such purchase, or any other investment.

JPMorgan Clearing Account ” shall mean the account of the Administrative Agent (for the benefit of itself and the Lenders) maintained at the office of JPMorgan Chase Bank, N.A., 10 South Dearborn, 7th Floor, Chicago, Illinois 60603, ABA/Routing No.: 021000021, Account No. 9008113381C3698, Reference: Summit Ent.

Key Materials ” shall have the meaning given to such term in Section 5.11.

knowledge ” shall mean the current actual knowledge of an Authorized Officer of a Person that is not a natural Person.

Laboratory ” shall mean (i) any of Technicolor, Deluxe Laboratories, Inc., NT Audio, Fotokem, EFilm, ARRI Film & TV Services GmbH, Company 3, LLC, Warner Bros. Motion Picture

Imaging, Pro Tek and Iron Mountain, and any of their respective Affiliates (including, without limitation, Deluxe Italia) and any laboratory customarily used by Lions Gate Entertainment Inc. or any of its Subsidiaries (other than the Borrower and its Subsidiaries), (ii) any laboratory commonly used by Major Studios and (iii) any other laboratory reasonably acceptable to the Administrative Agent, in each case, where such laboratory is a party to a Pledgeholder Agreement or a Laboratory Access Letter; provided , that none of the foregoing shall include locations outside of the United States, United Kingdom or Canada (unless the Key Materials with respect to the applicable Picture are held at a Laboratory in the United States, United Kingdom or Canada) without the consent of the Administrative Agent, except for a limited duration as may be reasonably required for a Picture produced in another territory; provided further , that for any acquisition or co-financing in which a Credit Party is not acting as “lead studio”, the laboratory at which such Picture’s materials are on deposit shall be deemed a Laboratory.

Laboratory Access Letter ” shall mean a letter agreement among (i) a Laboratory holding any elements (including data backups of work in progress) of any Picture to which any Credit Party has the right of access, (ii) the applicable Credit Party, (iii) if appropriate, the applicable Distributor, and (iv) any other appropriate Person, substantially in the form of Exhibit E or in such other form otherwise reasonably acceptable to the Administrative Agent, in each case as the same may be amended, supplemented or otherwise modified, renewed or replaced from time to time; provided that any such letter agreement may not be amended in a manner which adversely affects the rights of (or the benefit to) the Administrative Agent or any Lender thereunder without the prior written consent of the Administrative Agent.

Lender ” and “ Lenders ” shall mean the financial institutions whose names appear on the signature pages hereof, any assignee of a Lender pursuant to Section 13.3, and their respective successors.

Lending Office ” shall mean, with respect to any Lender, the branch or branches (or Affiliate or Affiliates of such Lender) from which any of such Lender’s LIBOR Loans or Alternate Base Rate Loans, as the case may be, are made or maintained and for the account of which all payments of principal of, and interest on, such Lender’s LIBOR Loans or Alternate Base Rate Loans are made, as notified to the Administrative Agent from time to time.

LG Credit Agreement ” shall mean that certain Second Amended and Restated Credit, Security, Guaranty and Pledge Agreement, dated as of July 25, 2008, (as may be further amended, supplemented or otherwise modified, renewed or replaced from time to time after the Closing Date), among (i) Lions Gate Entertainment Inc., a Delaware corporation, Lions Gate UK Limited, a private company limited by shares incorporated in England and Wales and Lions Gate Australia Pty Limited, an Australian company (ACN 122 557 260), as borrowers; (ii) the guarantors referred to therein; (iii) the lenders referred to therein; (iv) JPMorgan Chase Bank, N.A., as administrative agent for such lenders, and as issuing bank; (v) Wachovia Bank, N.A., as syndication agent.

LG Intercreditor Agreement ” shall mean the intercreditor agreement, dated as of January 13, 2012 among the Servicer, the Borrower, U.S. Bank National Association as trustee under the LG Notes Indenture, the administrative agent under the LG Credit Agreement, and the

Administrative Agent under the Credit Agreement, which intercreditor agreement shall be in form and substance satisfactory to the Administrative Agent.

LG Notes Indenture ” shall mean that certain Indenture, dated as of October 21, 2009, (as may be amended, supplemented or otherwise modified, renewed or replaced from time to time after the Closing Date) among Lions Gate Entertainment Inc., Lions Gate Entertainment Corp., the other guarantors party thereto, and U.S. Bank National Association, as trustee, providing for the issuance of the 10.25% senior secured second priority notes due 2016.

LG Rights Sales Transaction ” shall mean a sale by a Credit Party of distribution rights to a Picture to Lions Gate Entertainment Corp. or any of its wholly-owned Subsidiaries, in each case subject to the approval of the Administrative Agent in its sole discretion.

LG Sublicense ” shall mean a license of rights owned by Servicer or its Affiliate (other than Borrower and its Subsidiaries) to the Borrower in order to allow the exploitation of such rights, provided that the terms of each such LG Sublicense (i) must be reasonably acceptable to the Administrative Agent, (ii) shall include an indemnity in favor of Borrower on terms acceptable to the Administrative Agent and (iii) shall not require or permit the Borrower to exploit such rights pursuant to any such output agreement if doing so would prevent any rights owned by any Credit Party (if otherwise eligible for exploitation thereunder) from being exploited pursuant to any distribution agreement.

LGAC ” shall mean LGAC 1, LLC, or in the case of a reorganization of the ownership of the Borrower pursuant to Section 13.25, the LGAC Successor.

LGAC 1 Account ” shall mean the account of LGAC maintained with Union Bank and set forth on Schedule 6.14 hereto.

LGAC Successor ” shall have the meaning given to such term in Section 13.25(a)(i).

LGEC ” shall mean Lions Gate Entertainment Corporation.

LIBOR ” shall mean, with respect to any Interest Period for a Borrowing consisting of LIBOR Loans, a rate per annum equal to the greater of (a) 1.25% and (b) the quotient of (A) (i) the British Bankers’ Association Interest Settlement Rate per annum at which Dollar deposits are offered in London, England to prime banks in the London Interbank Market for such Interest Period as displayed on the Reuters LIBOR01 screen (or on any successor or substitute screen provided by Reuters) as of 11:00 a.m. (London time) two (2) Business Days before the first day of such Interest Period, or (ii) if the rate described in clause (A)(i) does not appear on the Reuters LIBOR01 screen (or on any successor or substitute screen provided by Reuters) on any relevant date of determination, the average of the rates (rounded upwards, if necessary, to the next 1/16 of 1%) at which Dollar deposits for a maturity equal to the applicable Interest Period are offered to the Lending Office of the Administrative Agent in immediately available funds in the London Interbank Market for Eurodollars at approximately 11:00 a.m. (London time) two (2) Business Days prior to the commencement of such Interest Period, in each case divided by (B) one (1) minus the applicable


statutory reserve requirements of the Administrative Agent, expressed as a decimal (including without duplication or limitation, basic, supplemental, marginal and emergency reserves), from time to time in effect under Regulation D or similar regulations of the Board with respect to eurocurrency funding (currently referred to as “Eurocurrency Liabilities” in such Regulation D). It is agreed that for purposes of this definition, LIBOR Loans made hereunder shall be deemed to constitute Eurocurrency Liabilities (as defined in Regulation D) and to be subject to the reserve requirements of Regulation D.

LIBOR Loan ” shall mean a Loan bearing interest at a rate determined by reference to LIBOR in accordance with the provisions of Article 2.

Licensing Intermediary ” shall mean any of the following and their respective Affiliates: Fintage House, Freeway, Summit International Distribution, Inc., Cinephil France S.A.S. and Proscenium Pictures Ltd., and (iv) any other Person acceptable to the Administrative Agent, which in each case will serve as a licensing intermediary for distribution rights in respect of a Picture, provided in each case that the Administrative Agent may in good faith using its reasonable credit judgment from time to time by written notice to the Borrower remove any such Person as a Licensing Intermediary on a prospective basis only with respect to Pictures which have not yet been Greenlit.

Lien ” shall mean any mortgage, copyright mortgage, pledge, security interest, encumbrance, lien or charge of any kind whatsoever (including, without limitation, any conditional sale or other title retention agreement, any agreement to grant a security interest at a future date, any lease in the nature of security, and the filing of, or agreement to give, any financing statement under the Uniform Commercial Code of any jurisdiction).

Liquidity Certificate ” shall mean a liquidity certificate in substantially the form of Exhibit K , executed by an Authorized Officer of the Borrower and delivered to the Administrative Agent as required hereunder.

Loans ” shall have the meaning given to such term in Section 2.1(a).

Major Studio ” shall mean each of the following studios and its primary U.S. distribution Subsidiary, or any other subsidiary so long as its performance is guaranteed by such studio or its primary U.S. distribution Subsidiary: (i) Paramount Pictures Corporation, (ii) Twentieth Century Fox Film Corporation, (iii) Sony Pictures Entertainment Inc., (iv) Walt Disney Motion Pictures Group, Inc., (v) Warner Bros. Entertainment Inc., (vi) Universal Pictures, a division of Universal City Studios, LLLP, and (vii) Lions Gate Entertainment Inc.

Margin Stock ” shall be as defined in Regulation U of the Board.

Master Recordings ” shall mean all master tapes (whether digital or analog) and every recording of sound (by any method and on any substance or material, now known or hereafter developed), whether or not coupled with a visual image, including all multitrack master tapes (including any eight (8), sixteen (16), twenty-four (24) and forty-eight (48) track master tapes and all two (2) track sequenced, fully-mixed, edited, equalized, leadered and mastered digital audio tapes and/or U-Matic 1630 tapes) and all acetates and metal or other equivalent parts or reproductions


of such master tapes and recordings, and all other materials used or useful in the recording, production or manufacture of Records.

Material Adverse Effect ” shall mean any change or effect that (i) has a materially adverse effect on the business, assets, properties, operations or financial condition of the Credit Parties (taken as a whole), (ii) materially impairs the legal right, power or authority of any Credit Party to perform its respective obligations under the Fundamental Documents to which it is a party, or (iii) materially impairs the validity or enforceability of, or materially impairs the rights, remedies or benefits available to the Administrative Agent (for the benefit of the Secured Parties) under the Fundamental Documents.

Maturity Date ” shall mean the earlier of (i) September 7, 2016, and (ii) such other date as the Loans shall become due and payable in accordance with Article 7.

Maximum Domestic Net Exposure ” shall mean, for any Picture determined as of the date such Picture becomes a Seasoned Picture, the Credit Parties’ share of Negative Cost, which shall be net of the Credit Parties’ share of (i) minimum guarantees, (ii) subsidies and other incentive payments, (iii) co-financing amounts and (iv) any other similar amounts which are credited against the Negative Cost of such Picture (but which are not tied to the performance of such Picture), in each case either (a) already received or (b) which are fixed amounts that have been contracted; provided that any voluntary payments of (or agreements to pay) amounts to be applied to the Negative Cost of such Picture subsequent to the date such Picture becomes a Seasoned Picture shall be included in the Credit Parties’ share of Negative Cost; provided further that any such contracted amounts which are ultimately disaffirmed or not paid when due for any reason post-seasoning shall be retroactively added to the calculation of Maximum Domestic Net Exposure (but exposure may be reduced by a replacement contract or if such amount is utlimately collected from the applicable counterparty).

Moody’s ” shall mean Moody’s Investors Service, Inc.

Multiemployer Plan ” shall mean a plan described in Section 4001(a)(3) of ERISA.

Music Agreements ” shall mean all license agreements, or any other agreements pursuant to which the Borrower or any of its Subsidiaries acquires rights to publish, distribute or otherwise exploit Master Recordings, Musical Compositions or other Music Product.

Music Product ” shall mean (i) Master Recordings; (ii) Musical Compositions; (iii) any and all appurtenant rights to the Master Recording, Musical Compositions and Sound Recordings pursuant to the grant of rights under a Music Agreement or otherwise (including, without limitation, with respect to videos, packaging, artwork and rights to use a recording artist or songwriter’s name and likeness, merchandise, live performances, ticketing, sponsorships, and/or artist endorsements or commercial “tie-ins”) and (iv) any Records on which any of the foregoing are embodied.

Musical Compositions ” shall mean that portion of all right, title and interest in and to any musical compositions (whether published or unpublished, registered or unregistered), which


is owned by or licensed to the Borrower or any of its Subsidiaries, including without limitation, all rights to (a) the exploitation thereof in the form of sheet music, orchestrations, folios, compilations, songbooks and other forms of print, (b) the exploitation thereof as embodied in Records, (c) the inclusion of performances thereof in motion pictures, videotapes and other audiovisual works and (d) the granting to third parties of the right to perform the such musical compositions publicly, world-wide.

Negative Cost ” shall mean, with respect to any Picture, the aggregate amount of the development and pre-production expenses of such Picture plus the cost of all production elements usually and customarily included as part of the negative cost of a Picture (including any contingency fee required under the applicable Approved Completion Bond) plus customary post production costs of such Picture and all other delivery items, and shall specifically include charges for any Approved Completion Bond fee which is to be paid but shall be net of any casualty insurance proceeds related to such Picture; provided , in the case of a Picture which is acquired rather than produced by a Credit Party, the term “Negative Cost” shall mean the acquisition price paid or to be paid by such Credit Party for such Picture pursuant to the applicable negative pickup documentation or co-financing documentation.

Negative Pick Up Obligation ” shall mean, with respect to any Picture, a commitment by a Credit Party to pay a certain sum of money in order to obtain ownership of, or certain distribution rights in, such Picture on Completion and delivery to such Credit Party.

Net Available Proceeds ” shall mean:

(i)    in the case of any Disposition, the amount of Net Cash Payments actually or constructively received by a Credit Party in connection with such Disposition;




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