United states securities and exchange commission



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(b)      Schedule 3.8(b) lists all the trademarks registered and trademark applications (excluding any applications filed, in whole or in part, on an intent to use basis) filed in the U.S. Patent and Trademark Office by any Credit Party (including those to be registered or filed as of the Closing Date) and identifies the Credit Party which registered or filed (or which will register or file, as of the Closing Date) each such trademark, including the respective registration or application numbers and applicable dates of registration or application. Each trademark set forth on Schedule 3.8(b) that is registered in the U.S. Patent and Trademark Office or for which an application has been filed in the U.S. Patent and Trademark Office in the name of a Credit Party, in each case as of the Closing Date, has been included on Schedule A to the Trademark Security Agreement that was delivered to the Administrative Agent on or prior to the Closing Date pursuant to Section 4.1(f).

(c)      Except as disclosed on Schedule 3.8(c) , to the knowledge of the Credit Parties, all registrations for all copyrights, trademarks and service marks in which any Credit Party has any rights described in subsections (a) and (b) above are valid and in full force and effect (other than registrations for copyrights, trademarks and service marks that in the aggregate are not material) and are not and will not be subject to the payment of any taxes or maintenance fees (other than U.S. Patent & Trademark Office fees for filings made pursuant to Sections 8, 9 and 15 of the Lanham Act, 15 U.S.C. § 1050 et al, to maintain and/or renew the trademark and/or service mark registrations) or other actions prior to the Maturity Date to maintain their validity or effectiveness.

SECTION 3.9      Fictitious Names . Except as disclosed on Schedule 3.9 , no Credit Party has done business, is doing business or intends to do business other than under its full legal name, including, without limitation, under any trade name or other “doing business as” name.

SECTION 3.10      Title to Properties . Each Credit Party has good title to, or valid leasehold interests in, each of the properties and assets reflected on the most recent financial statements referred to in Section 3.5, except, in each case, to the extent failure to possess such title or valid leasehold interest could not reasonably be expected to have a Material Adverse Effect, and all such properties and assets are free and clear of Liens, except Permitted Encumbrances.

SECTION 3.11      Chief Executive Office; Location of Collateral; Tax Identification Number . Schedule 3.11 lists (i) the chief executive office of each Credit Party, (ii) all of the places where any Credit Party keeps the records (other than any off-site storage facilities from which such records are readily retrievable, a list of which facilities is available upon the Administrative Agent’s request) concerning the Collateral or regularly keeps any goods included in the Collateral as of the Closing Date, and (iii) each Credit Party’s tax identification and organizational number.

SECTION 3.12      Litigation . Schedule 3.12 sets forth a list as of the Closing Date of all actions, suits or other proceedings at law or in equity by or before any arbitrator, arbitration panel or Governmental Authority (including, but not limited to, matters arising under or related to Environmental Law), and to the best of each Credit Party’s knowledge, any investigation by any Governmental Authority of the affairs of, or threatened action, suit or other proceeding against or affecting, any Credit Party or any of their respective properties or rights, none of which actions, suits, proceedings or investigations would, if adversely determined, have a Material Adverse Effect. No Credit Party is in default with respect to any order, writ, injunction, decree, rule or regulation of any Governmental Authority binding upon such Person, which default could reasonably be

expected to result in a Material Adverse Effect.

SECTION 3.13      Federal Reserve Regulations . None of the Credit Parties is engaged principally or as one of its important activities, in the business of extending credit for the purpose of purchasing or carrying any Margin Stock. No part of the proceeds of the Loans will be used, directly or indirectly, whether immediately, incidentally or ultimately (i) to purchase or carry any Margin Stock or to extend credit to others for the purpose of purchasing or carrying any Margin Stock, or (ii) for any other purpose, in each case, violative of or inconsistent with any of the provisions of any regulation of the Board, including, without limitation, Regulations T, U and X thereto.

SECTION 3.14      Investment Company Act . None of the Credit Parties is, or will during the term of this Credit Agreement be, (i) an “investment company,” within the meaning of the Investment Company Act of 1940, as amended or (ii) subject to regulation under any foreign, federal or local statute or any other Applicable Law of the United States of America or any other jurisdiction, in each case limiting its ability to incur indebtedness for money borrowed as contemplated hereby or by any other Fundamental Document.

SECTION 3.15      Taxes . Each Credit Party has filed or caused to be filed all material federal, state, local and foreign tax returns which are required to be filed with any Governmental Authority after giving effect to applicable extensions, and has paid or has caused to be paid all material taxes as shown on said returns or on any assessment received by it in writing, to the extent that such taxes have become due, except as permitted by Section 5.12. No Credit Party knows of any material additional assessments or any basis therefor. The Credit Parties believe that the charges, accruals and reserves on its books in respect of taxes or other governmental charges are accurate and adequate, in accordance with GAAP.

SECTION 3.16      Compliance with ERISA . Each of the Credit Parties’ Plans (if any), all of which, as of the Closing Date, are listed on Schedule 3.16 , and each of which has been maintained and operated in all material respects in accordance with all Applicable Laws, including ERISA and the Code, and each Plan (if any) intended to qualify under section 401(a) of the Code satisfies the requirements of this Section 3.16 in all material respects. No Reportable Event has occurred as to any Plan, and the present value of all benefits under all Plans subject to Title IV of ERISA (based on those assumptions used to fund such Plans) did not, in the aggregate, as of the last annual valuation date applicable thereto, exceed the actuarial value of the assets of such Plans allocable to such benefits. No material liability has been, and no circumstances exist pursuant to which any material liability is reasonably likely to be, imposed upon any Credit Party or ERISA Affiliate (i) under sections 4971 through 4980E of the Code, sections 502(i) or 502(l) of ERISA, or Title IV of ERISA with respect to any Plan or Multiemployer Plan, or with respect to any plan heretofore maintained by any Credit Party or ERISA Affiliate, or any entity that heretofore was an ERISA Affiliate, (ii) for the failure to fulfill any obligation to contribute to any Multiemployer Plan, or (iii) with respect to any Plan that provides post retirement welfare coverage (other than as required pursuant to Section 4980B of the Code). Neither any Credit Party nor any ERISA Affiliate has received any notification that any Multiemployer Plan is in reorganization or has been terminated within the meaning of Title IV of ERISA, and no Multiemployer Plan is reasonably expected to be in reorganization or to be terminated.


SECTION 3.17      Agreements .

(a)      No Credit Party is in default in the performance, observance or fulfillment of any of the material obligations, covenants or conditions contained in any material agreement or instrument (including, without limitation, any Distribution Agreement) to which it is a party, which default could have a materially negative impact on the business of the Credit Parties.

(b)      Schedule 3.17 is a true and complete listing as of the Closing Date of (i) all currently operative credit agreements, indentures, notes, and other agreements related to any indebtedness for borrowed money of any Credit Party, other than the Fundamental Documents, (ii) all material Distribution Agreements, (iii) all joint ventures to which a Credit Party is a party, (iv) all agreements or other arrangements pursuant to which any Credit Party has granted a Lien to any Person (other than Excluded Liens) on or after April 18, 2007 and (v) each other material contractual agreement and each material amendment thereto. The Credit Parties have delivered or made available to the Administrative Agent a true and complete copy of each agreement (or, if not yet executed, the most recent draft) described on Schedule 3.17 , including all exhibits and schedules thereto. For purposes of this Section 3.17 , a Distribution Agreement or other contractual arrangement shall be deemed “ material ” if any Credit Party reasonably expects that a Credit Party would, pursuant to the terms thereof, (A) recognize future revenues in excess of $20,000,000, (B) incur liabilities or obligations in excess of $20,000,000, or (C) could reasonably be likely to suffer damages or losses in excess of $20,000,000 by reason of the breach or termination thereof; provided the foregoing shall not include any agreement with any Person rendering services on any Picture.

SECTION 3.18      Security Interest . This Credit Agreement and the other Fundamental Documents, when executed and delivered and, upon the making of the extension of credit hereunder, will create and grant to the Administrative Agent (for the benefit of the Secured Parties), upon (i) the filing of the appropriate UCC 1 financing statements with the filing offices listed on Schedule 3.18 , (ii) the filing of Form MG01 in connection with the U.K. Credit Parties, (iii) the filing of the Copyright Security Agreement with the U.S. Copyright Office, (iv) the filing of the Trademark Security Agreement with the U.S. Patent and Trademark Office, (v) the delivery of any certificated Pledged Securities with appropriate stock powers (or any comparable document for non corporate entities to the extent certificated) duly executed in blank to the Administrative Agent (and the Administrative Agent having taken possession or control of such Pledged Securities), (vi) the execution and delivery of any applicable Account Control Agreements, and (vii) the payment of all applicable filings fees for the documents referenced in the preceding clauses (i), (ii), (iii) and (iv) a valid and perfected security interest in the Collateral to the extent (A) in the case of Pictures, set forth on Schedule 3.8(a) , or (B) such security interest can be perfected by the actions described in clauses (i) through (vi) above (prior to all other Liens other than any Specified Permitted Encumbrances (including, for the avoidance of doubt, the lien of the Comerica Agent) not otherwise subordinated to such security interest pursuant to the terms of any applicable intercreditor agreement and, in the case of certificated Pledged Securities so delivered, prior to all other Liens).

SECTION 3.19      Environmental Liabilities .

(a)      Except as disclosed on Schedule 3.19 , no Credit Party (and to the best of each Credit Party’s knowledge no other Person) has used, stored, treated, transported, manufactured,

refined, handled, produced, Released or disposed of any Hazardous Materials on, under, at, from or in any way affecting, any of the properties or assets owned, operated, occupied or leased by a Credit Party, in material violation of any Environmental Law, or in any other manner, that in either case could result in a material liability to the Credit Parties and their Subsidiaries taken as a whole.

(b)      (i) No Finance Party has any obligations or liabilities, known or unknown, matured or not matured, absolute or contingent, or assessed or unassessed, arising under or related to Environmental Laws or Hazardous Materials which could reasonably be expected to have a Material Adverse Effect, and (ii) no claims have been made against any of the Finance Parties in the past five (5) years and no pending, threatened or outstanding citations, orders, proceedings or notices have been issued against any of the Credit Parties arising under or related to Environmental Laws or Hazardous Materials, which could reasonably be expected to have a Material Adverse Effect, in each case of (i) and (ii) including, without limitation, any such obligations or liabilities relating to or arising out of activities of any of its respective employees, agents, representatives, affiliates or predecessors in interest or any other Person with respect to which any Credit Party is responsible, either contractually, by operation of law or otherwise.

SECTION 3.20      Pledged Securities .

(a)      All of the Pledged Securities are duly authorized, validly issued, fully paid and non assessable, and are owned and held by the Pledgors (as applicable), free and clear of any Liens, other than those created pursuant to this Credit Agreement and Liens securing the Existing Comerica Loan Facility, and there are no restrictions on the transfer of the Pledged Securities other than as a result of this Credit Agreement or applicable securities laws and the regulations promulgated thereunder. The Pledged Securities are owned by the Persons specified on Schedule 3.7(a) and Schedule 3.7(b) .

(b)      There are no (i) outstanding rights, warrants, options, conversion or similar rights currently outstanding with respect to, and no agreements to purchase or otherwise acquire, any shares of the capital stock or other Equity Interests of any issuer of any of the Pledged Securities, or (ii) securities or obligations of any kind convertible into any shares of the capital stock or other Equity Interests of any issuer of any of the Pledged Securities.

(c)      Article 10 creates in favor of the Administrative Agent (on behalf of the Secured Parties), a valid, binding and enforceable security interest in, and Lien upon, all right, title and interest of the Pledgors in the Pledged Collateral and upon delivery to the Administrative Agent of the certificated instruments (if any) representing all Pledged Securities, accompanied by undated stock powers (or any comparable documents for non-corporate entities to the extent certificated), duly endorsed or executed in blank by the appropriate Pledgor, shall constitute a fully perfected first priority security interest and Lien upon all right, title and interest of the Pledgors in such Pledged Collateral.

SECTION 3.21      Compliance with Laws . No Credit Party is in violation of any Applicable Law which violation could reasonably be expected to result in a Material Adverse Effect. The Borrowings hereunder, the intended use of the proceeds of the Loans as contemplated by Section 5.17 and any other transactions contemplated hereby will not violate any Applicable Law.


SECTION 3.22      Subsidiaries . Set forth on Schedule 3.22 is a true and complete list of all of the Subsidiaries of the Credit Parties and all Co-Financing Venture Entities, together with, for each such Subsidiary and Co-Financing Venture Entity, (i) the jurisdiction of formation or organization (as the case may be) of such Subsidiary and Co-Financing Venture Entity, (ii) the authorized capitalization of such Subsidiary and Co-Financing Venture Entity, (iii) each Person holding ownership interests in such Subsidiary and Co-Financing Venture Entity and the type of such interests, and (iv) the percentage of ownership of such Subsidiary and Co-Financing Venture Entity represented by such ownership interests.

SECTION 3.23      Solvency . No Credit Party has entered, or is entering, into the arrangements contemplated hereby or by the other Fundamental Documents, or intends to make any transfer or incur any obligations hereunder or thereunder, with actual intent to hinder, delay or defraud either present or future creditors. On and as of the Closing Date and any date on which an extension of credit is made hereunder, on a pro forma basis after giving effect to all Indebtedness (including the Loans): (a) each Credit Party expects the cash available to such Credit Party, after taking into account all other anticipated uses of the cash of such Credit Party (including the payments on or in respect of debt referred to in clause (c) below), will be sufficient to satisfy all final judgments for money damages which have been docketed against such Credit Party or which may be rendered against such Credit Party in any action in which such Credit Party is a defendant (taking into account the reasonably anticipated maximum amount of any such judgment and the earliest time at which such judgment might be entered); (b) the sum of the present fair saleable value of the assets of each Credit Party will exceed the probable liability of such Credit Party on its debts (including its Guarantees after giving effect to the Contribution Agreement); (c) no Credit Party will have incurred or intends to, or believes that it will, incur debts beyond its ability to pay such debts as such debts mature (taking into account the timing and amounts of cash to be received by such Credit Party from any source, and of amounts to be payable on or in respect of debts of such Credit Party and the amounts referred to in clause (b) above); and (d) each Credit Party believes it will have sufficient capital with which to conduct its present and proposed business and the property of such Credit Party does not constitute unreasonably small capital with which to conduct its present or proposed business. For purposes of this Section 3.23, “debt” means any liability or a claim, and “claim” means any (i) right to payment whether or not such right is reduced to judgment, liquidated, unliquidated, fixed, contingent, matured, unmatured, disputed, undisputed, legal, equitable, secured or unsecured, or (ii) right to an equitable remedy for breach of performance if such breach gives rise to a payment, whether or not such right is reduced to judgment, liquidated, unliquidated, fixed, contingent, matured, unmatured, disputed, undisputed, legal, equitable, secured or unsecured.

SECTION 3.24      True and Complete Disclosure . Neither any Fundamental Document nor any other material agreement, document, instrument, certificate or statement (other than (i) the Business Plan, (ii) any other projections, estimates, or other forward-looking information, and (iii) any forward-looking pro forma financial information) furnished to the Administrative Agent and the Lenders by or on behalf of any Credit Party in connection with the transactions contemplated hereby, at the time it was furnished contained any untrue statement of a material fact or omitted to state a material fact necessary in order to make the statements contained herein or therein, under the circumstances under which they were made, not misleading (considered in the context of all other information provided to the Lenders). The Business Plan and any other projections, estimates, forward-looking information or any forward-looking pro forma financial information furnished to


the Administrative Agent pursuant to this Credit Agreement are based on good faith estimates and assumptions believed by management of the Borrower to be reasonable at the time made in light of the circumstances in existence at such time, it being understood by the Administrative Agent and the Lenders that, without limiting the foregoing representation, (i) the Business Plan or such other information as they relate to future events is not to be viewed as fact, and (ii) actual results during the period or periods covered by the Business Plan or such other information are subject to significant uncertainties and contingencies and may differ materially from the projected results set forth therein. There is no fact known to any Credit Party (other than general industry conditions) which materially and adversely affects, or in the future may reasonably be expected to materially and adversely affect, the business, properties, assets, operations or condition (financial or otherwise) of the Credit Parties, taken as a whole.

SECTION 3.25      Status as a Pass-Through Entity . At all times since its formation, each Credit Party has been either a “disregarded entity” or a “partnership” for U.S. federal, state and local income and franchise tax purposes (other than Summit Distribution, LLC; Summit International Distribution, Inc. and Summit Entertainment Development Services).

SECTION 3.26      Excluded Subsidiaries .

(a)      Attached hereto as Schedule 3.26 is a correct and complete list as of the Closing Date of each Excluded Subsidiary showing as to each (i) the jurisdiction of formation or organization (as the case may be) of such Excluded Subsidiary, (ii) the authorized capitalization of such Excluded Subsidiary, (iii) each Person holding ownership interests in such Excluded Subsidiary and the type of such interests, (iv) the percentage of ownership of such Excluded Subsidiary represented by such ownership interests and (v) an explanation as to why it qualifies as an Excluded Subsidiary.

SECTION 3.27      Representations on behalf of Excluded Subsidiaries . The Credit Parties repeat the representations, warranties and agreements contained in Sections 3.1(a), 3.1(b)(i) and (ii), 3.2 (other than with respect to Collateral and Pledged Securities), 3.3, 3.4, 3.7, 3.12, 3.15, 3.16, 3.17, 3.19, 3.20 (other than Co-Financing Venture Entities and their Subsidiaries) and 3.21; provided , that each reference therein to a Credit Party shall be deemed to also include each Finance Party (other than Co-Financing Venture Entities and their Subsidiaries which are neither controlled by a Credit Party nor for which production or exploitation of the related Picture is controlled by a Credit Party (in each case, as opposed to the applicable Approved Co-Financing Venture Counterparty)).

4.      CONDITIONS OF LENDING

SECTION 4.1      Conditions Precedent to Loan . The obligation of each Initial 2012 Lender to make its Loan hereunder was subject to the satisfaction in full of the following conditions precedent:

(a)      Organizational Documents . The Administrative Agent shall have received:

(i)      a copy of the certificate of formation or articles or certificate of incorporation


(or equivalent document) of each Credit Party, certified as of a recent date by the Secretary of State or other relevant office of such Person’s jurisdiction of formation or incorporation, which certificate lists (if such type of list is generally available in the applicable jurisdiction) the charter documents on file in the office of such Secretary of State;

(ii)      a certificate of the Secretary of State of such jurisdiction of formation or incorporation, dated as of a recent date, as to the good standing of, and, if generally available in the applicable jurisdiction, the payment of taxes then due and payable by, each Credit Party (other than Proscenium Pictures, Ltd.);

(iii)      a certificate dated as of a recent date as to the good standing and/or authority to do business of each Credit Party, issued by the Secretary of State or other relevant office of each jurisdiction in the United States, if any, in which such Person is qualified as a foreign entity; and

(iv)      a certificate of the Secretary, Assistant Secretary or other appropriate officer (or member or manager, as the case may be, in the case of limited liability companies) acceptable to the Administrative Agent, of each Credit Party, dated as of the Closing Date and certifying (A) that attached thereto is a true and complete copy of the certificate of formation or articles or certificate of incorporation (or equivalent document) of such Person; (B) that attached thereto is a true and complete copy of the operating agreement, by laws, or equivalent document of such Person as in effect on the date of such certification; (C) that attached thereto is a true and complete copy of the resolutions adopted by the applicable managing body of such Person authorizing the execution, delivery and performance in accordance with their respective terms of the Fundamental Documents executed by such Person, and any other documents required or contemplated hereunder or thereunder, the grant of the security interests in the Collateral and the Pledged Collateral, and in the case of the Borrower, the Borrowings hereunder, and that such resolutions have not been amended, rescinded or supplemented and are currently in effect; (D) that the certificate of formation or articles or certificate of incorporation (or equivalent document) of such Person has not been amended since the date of the last amendment thereto indicated on the certificates of the Secretary of State or other appropriate office furnished pursuant to clause (i) above; and (E) as to the incumbency and specimen signature of each officer (or member or manager, as the case may be) of such party executing any Fundamental Document or such other documents required or contemplated hereunder or thereunder (such certificate to contain a certification by another officer (or member or manager, as the case may be) of such Person as to the incumbency and signature of the officer (or member or manager, as the case may be) signing the certificate referred to in this clause (iv) or a certification by the signing officer (or member or manager, as the case may be) that he or she is the sole officer (or member or manager, as the case may be) of such Person.




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