Urban Outfitters 2016 Annual Report Download - page 161

(b) Except for Overadvances permitted under Section 2.05, in the event and on each occasion that the Borrowers are not in compliance with the
Revolving Exposure Limitations (including following any Revaluation Date), the Borrowers shall severally prepay the Revolving Loans and/or Swingline
Loans (or, if no such Loans are outstanding, Cash Collateralize outstanding Letters of Credit) of such Borrower(s) in an aggregate amount that, after giving
effect to such prepayments or Cash Collateralization the Borrowers shall be in compliance with the Revolving Exposure Limitations.
(c) During any Dominion Period or during any time when an Event of Default shall have occurred and be continuing, subject to the Permitted Term
Loan Intercreditor Agreement, if any, in the event and on each occasion that any Net Proceeds are received by or on behalf of any Loan Party or any
Restricted Subsidiary in respect of any Prepayment Event, the Borrowers shall, immediately after such Net Proceeds are received by any Loan Party or any
Restricted Subsidiary, prepay the Obligations and cash collateralize the LC Exposure as set forth in Section 2.11(d) below in an aggregate amount equal to
100% of such Net Proceeds;
provided that, in the case of any event described in clause (a) or (b) of the definition of the term “Prepayment Event”, if the Borrower Representative shall
deliver to the Administrative Agent a certificate of a Financial Officer to the effect that the Loan Parties intend to apply the Net Proceeds from such event (or
a portion thereof specified in such certificate), within 180 days after receipt of such Net Proceeds, to acquire (or replace or rebuild) real property, equipment or
other tangible assets (excluding inventory) to be used in the business of the Loan Parties, and certifying that no Default has occurred and is continuing, then
either (i) so long as full cash dominion is not in effect, no prepayment shall be required pursuant to this paragraph in respect of the Net Proceeds specified in
such certificate or (ii) if full cash dominion is in effect, then, if the Net Proceeds specified in such certificate are to be applied to acquire, replace or rebuild
such assets by (A) the Borrowers, such Net Proceeds shall be applied by the Administrative Agent to reduce the outstanding principal balance of the
Revolving Loans (without a permanent reduction of the Revolving Commitment) and upon such application, the Administrative Agent shall establish a
Reserve against the Borrowing Base in an amount equal to the amount of such proceeds so applied and (B) any Loan Party that is not a Borrower, such Net
Proceeds shall be deposited in a cash collateral account, and in the case of either (A) or (B), thereafter, such funds shall be made available to the applicable
Loan Party as follows:
(1) the Borrower Representative shall request a Borrowing of Revolving Loans (specifying that the request is to use Net Proceeds pursuant to this
Section) or the applicable Loan Party shall request a release from the cash collateral account be made in the amount needed;
(2) so long as the conditions set forth in Section 4.02 have been met, the Revolving Lenders shall make such Borrowing of Revolving Loans or the
Administrative Agent shall release funds from the cash collateral account; and
(3) the Reserve established with respect to such insurance proceeds shall be reduced by the amount of such Borrowing of Revolving Loans;
provided that to the extent of any such Net Proceeds therefrom that have not been so applied by the end of such 180 day period, a prepayment shall be
required at such time in an amount equal to such Net Proceeds that have not been so applied; provided, further that the Borrowers shall not be permitted to
make elections to use Net Proceeds to acquire (or replace or rebuild) real property, equipment or other tangible assets (excluding inventory) with respect to
Net Proceeds in any fiscal year in an aggregate amount in excess of $25,000,000.
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