United Site Services - Chapter 11 DIP Terms

DIP Terms

Borrower(s) / Guarantor(s)

• PECF USS Intermediate Holding III Corporation, as Borrower
• PECF USS Intermediate Holding II Corporation ("Holdings") and each of the Debtors (other than the Borrower), as Guarantors

Agent / Lender(s)

• Wilmington Savings Fund Society, FSB, as Administrative Agent and Collateral Agent
• Barclays Bank PLC, as Fronting Lender
• Certain financial institutions, as DIP Lenders and Backstop Lenders

DIP Commitments

• $120 million senior secured superpriority term loan facility comprised of:
  • $62.5 million in Interim DIP Loans, available in a single draw upon entry of the Interim Order
  • $57.5 million in Final DIP Loans, available in a single draw upon entry of the Final Order
• The loans are provided and funded through the Fronting Lender in accordance with the DIP documents.

Cash Collateral

• The Debtors are authorized to use Prepetition Collateral, including Cash Collateral, subject to the Approved Budget and Permitted Variances.
• Specific covenants apply to the use of ABL Cash Collateral, including maintenance of cash management arrangements and reporting requirements.

Interest Rate

• Term SOFR + 7.75%
• Term SOFR Floor: 2.00%
• Default Rate Increase: 2.00%

Fees

• Backstop Fee: 7.50% of the DIP Term Loan Commitments held by Backstop Lenders, payable in kind (capitalized) on the Closing Date.
• Upfront Fee: 2.00% of the DIP Term Loan Commitments, payable in kind (capitalized) upon funding of the Interim DIP Loans and Final DIP Loans, respectively.
• Administrative Agent fees as set forth in a separate Agency Fee Letter.

Maturity

• The earliest to occur of:
  • December 30, 2026 (Initial Maturity Date), which may be extended to March 30, 2027, and subsequently to June 30, 2027, with the consent of the Required DIP Lenders
  • Substantial consummation of a confirmed Chapter 11 plan
  • Acceleration of the obligations following an Event of Default
  • Dismissal of the Chapter 11 Cases or conversion to Chapter 7

Carve Out

• Post-Carve Out Trigger Notice Cap: $6 million for professional fees incurred after delivery of a trigger notice.
• Chapter 7 Trustee Fee: $75,000.
• Pre-Carve Out Trigger Notice fees are allowed to the extent incurred prior to the delivery of a trigger notice.

Use of Proceeds

• Working capital and general corporate purposes
• Payment of fees, costs, and expenses of administering the Chapter 11 Cases
• Payment of Adequate Protection Obligations
• Funding the Carve Out and payment of professional fees
• Payment of agency fees and expenses owed under the DIP documents

Credit Bid

• The DIP Agent (at the direction of Required DIP Lenders) has the right to credit bid the DIP Obligations in connection with any sale of assets.
• The Prepetition ABL Agent and Prepetition First-Out/Second-Out Agent have the right to credit bid their respective obligations in connection with sales of ABL Priority Collateral and Fixed Asset Priority Collateral, respectively.

Avoidance Actions

• DIP Collateral excludes Avoidance Actions but, upon entry of the Final Order, includes any proceeds or property recovered from successful Avoidance Actions.

Challenge Period and Budget

• The Challenge Period ends on the earlier of:
  • 75 days from the entry of the Interim Order
  • The deadline for objections to confirmation of the Debtors' Chapter 11 plan
• Investigation Budget Cap: $75,000 for the Creditors' Committee (if appointed) to investigate, but not prosecute, challenges.

Securities and Priorities

• The DIP Obligations constitute superpriority administrative expense claims, subject only to the Carve Out.
• The DIP Lenders are granted valid, perfected liens on the DIP Collateral, subject to the Carve Out, with the following priorities:
  • First priority senior liens on Unencumbered Property
  • Junior liens on DIP Collateral subject to Permitted Liens and, with respect to ABL Priority Collateral, subject to ABL Adequate Protection Liens and Prepetition ABL Liens
  • Priming senior liens on Prepetition Collateral

Adequate Protection

Prepetition ABL Secured Parties

• Replacement liens on DIP Collateral and superpriority administrative expense claims (507(b) claims)
• Cash payments for interest accruing before and after the Petition Date at the non-default rate
• Payment of professional fees and expenses
• Financial reporting and field examination rights

Prepetition First-Out/Second-Out Secured Parties

• Replacement liens on DIP Collateral and superpriority administrative expense claims (507(b) claims)
• Cash payments for interest accruing before and after the Petition Date (for Revolving Lenders) and after the Petition Date (for Term Lenders) at the non-default rate
• Payment of professional fees and expenses

Prepetition First-Out Notes Secured Parties

• Replacement liens on DIP Collateral and superpriority administrative expense claims (507(b) claims)
• Cash payments for interest accruing after the Petition Date at the non-default rate
• Payment of professional fees and expenses

Prepetition Amended Term Loan Secured Parties

• Replacement liens on DIP Collateral and superpriority administrative expense claims (507(b) claims)
• Periodic cash payments for interest accruing at the non-default rate through the earlier of the plan effective date or March 31, 2026
• Payment of professional fees and expenses

Prepetition Third-Out Notes Secured Parties

• Replacement liens on DIP Collateral and superpriority administrative expense claims (507(b) claims)

Waivers

• Subject to entry of the Final Order:
  • Waiver of Section 506(c) surcharge rights against DIP or Prepetition Collateral
  • Waiver of the equitable doctrine of marshaling
  • Waiver of the Section 552(b) "equities of the case" exception

Permitted Variance

• Unfavorable variance of actual aggregate receipts and disbursements (excluding professional fees) compared to the Approved Budget shall not exceed:
  • 20% for the first Variance Testing Date
  • 15% for each Variance Testing Date thereafter