EXHIBIT 10.2
EXECUTION VERSION
$250,000,000
SECOND LIEN CREDIT AGREEMENT
Dated as of June 26, 2007
among
IM US HOLDINGS, LLC,
as Borrower,
INVERNESS MEDICAL INNOVATIONS, INC.,
as a Guarantor,
THE LENDERS
GENERAL ELECTRIC CAPITAL CORPORATION,
as Administrative Agent
and
UBS SECURITIES LLC,
as Syndication Agent, Joint Lead Arranger and Sole Bookrunner
- - -
GE CAPITAL MARKETS, INC,
as Joint Lead Arranger
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ARTICLE I DEFINITIONS, INTERPRETATION AND ACCOUNTING TERMS................. 1
Section 1.2 UCC Terms................................................. 30
Section 1.3 Accounting Terms and Principles........................... 31
Section 1.4 Payments.................................................. 31
Section 1.5 Interpretation............................................ 31
ARTICLE II THE TERM LOAN FACILITY......................................... 32
Section 2.1 The Term Loan Commitment.................................. 32
Section 2.2 Borrowing Procedures...................................... 32
Section 2.3 [Intentionally Omitted]................................... 33
Section 2.4 [Intentionally Omitted]................................... 33
Section 2.5 Termination of the Term Loan Commitments.................. 33
Section 2.6 Repayment of Term Loans................................... 33
Section 2.7 Optional Prepayments...................................... 33
Section 2.8 Mandatory Prepayments..................................... 33
Section 2.9 Interest.................................................. 35
Section 2.10 Conversion and Continuation Options....................... 36
Section 2.11 Fees...................................................... 36
Section 2.12 Application of Payments................................... 37
Section 2.13 Payments and Computations................................. 37
Section 2.14 Evidence of Debt.......................................... 38
Section 2.15 Suspension of Eurodollar Rate Option...................... 40
Section 2.16 Breakage Costs; Increased Costs; Capital Requirements..... 40
Section 2.17 Taxes..................................................... 41
Section 2.18 Substitution of Lenders................................... 43
Section 2.19 Acquisition Cash Collateral Account....................... 44
ARTICLE III CONDITIONS TO LOANS............................................ 45
Section 3.1 Conditions Precedent to Loans on the Closing Date......... 45
Section 3.2 Conditions Precedent to Each Loan......................... 48
Section 3.3 [Intentionally Omitted]................................... 48
Section 3.4 Determinations of Initial Borrowing Conditions............ 48
ARTICLE IV REPRESENTATIONS AND WARRANTIES.................................. 49
Section 4.1 Corporate Existence; Compliance with Law.................. 49
Section 4.2 Loan and Related Documents................................ 49
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Section 4.3 Ownership of Group Member................................. 50
Section 4.4 Financial Statements...................................... 50
Section 4.5 Material Adverse Effect................................... 52
Section 4.6 Solvency.................................................. 52
Section 4.7 Litigation................................................ 52
Section 4.8 Taxes..................................................... 52
Section 4.9 Margin Regulations........................................ 52
Section 4.10 No Burdensome Obligations; No Defaults.................... 53
Section 4.11 Investment Company Act.................................... 53
Section 4.12 Labor Matters............................................. 53
Section 4.13 ERISA..................................................... 53
Section 4.14 Environmental Matters..................................... 54
Section 4.15 Intellectual Property..................................... 54
Section 4.16 Title; Real Property...................................... 55
Section 4.17 Bank and Security Accounts................................ 55
Section 4.18 Insurance................................................. 55
Section 4.19 Delivery of Related Documents............................. 55
Section 4.20 Full Disclosure........................................... 55
Section 4.21 Patriot Act............................................... 56
ARTICLE V FINANCIAL COVENANTS.............................................. 56
Section 5.1 Maximum Consolidated Leverage Ratio....................... 56
Section 5.2 [Intentionally Omitted]................................... 57
Section 5.3 Capital Expenditures...................................... 57
ARTICLE VI REPORTING COVENANTS............................................. 57
Section 6.1 Financial Statements...................................... 57
Section 6.2 Other Events.............................................. 59
Section 6.3 Copies of Notices and Reports............................. 59
Section 6.4 Taxes..................................................... 59
Section 6.5 Labor Matters............................................. 60
Section 6.6 ERISA Matters............................................. 60
Section 6.7 Environmental Matters..................................... 60
Section 6.8 Other Information......................................... 60
Section 6.9 Delivery of Information to Lenders........................ 61
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ARTICLE VII AFFIRMATIVE COVENANTS.......................................... 61
Section 7.1 Maintenance of Corporate Existence........................ 61
Section 7.2 Compliance with Laws, Etc................................. 61
Section 7.3 Payment of Obligations.................................... 61
Section 7.4 Maintenance of Property................................... 61
Section 7.5 Maintenance of Insurance.................................. 61
Section 7.6 Keeping of Books.......................................... 62
Section 7.7 Access to Books and Property.............................. 62
Section 7.8 Environmental............................................. 62
Section 7.9 Use of Proceeds........................................... 63
Section 7.10 Additional Collateral and Guaranties...................... 63
Section 7.11 Deposit Accounts; Securities Accounts and Cash
Collateral Accounts....................................... 65
Section 7.12 Interest Rate Contracts................................... 65
Section 7.13 Credit Rating............................................. 65
Section 7.14 Merger.................................................... 65
Section 7.15 Postclosing Deliveries.................................... 67
ARTICLE VIII NEGATIVE COVENANTS............................................ 67
Section 8.1 Indebtedness.............................................. 67
Section 8.2 Liens..................................................... 68
Section 8.3 Investments............................................... 69
Section 8.4 Asset Sales and Stock Issuances........................... 71
Section 8.5 Restricted Payments....................................... 72
Section 8.6 Prepayment of Indebtedness; Payments on Subordinated
Debt...................................................... 73
Section 8.7 Fundamental Changes....................................... 73
Section 8.8 Change in Nature of Business.............................. 74
Section 8.9 Transactions with Affiliates.............................. 75
Section 8.10 Third-Party Restrictions on Indebtedness, Liens,
Investments or Restricted Payments........................ 75
Section 8.11 Modification of Certain Documents......................... 76
Section 8.12 Accounting Changes; Fiscal Year........................... 76
Section 8.13 Margin Regulations........................................ 77
Section 8.14 Compliance with ERISA..................................... 77
Section 8.15 Hazardous Materials....................................... 77
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ARTICLE IX EVENTS OF DEFAULT............................................... 77
Section 9.1 Definition................................................ 77
Section 9.2 Remedies.................................................. 79
ARTICLE X THE ADMINISTRATIVE AGENT......................................... 79
Section 10.1 Appointment and Duties.................................... 79
Section 10.2 Binding Effect............................................ 80
Section 10.3 Use of Discretion......................................... 81
Section 10.4 Delegation of Rights and Duties........................... 81
Section 10.5 Reliance and Liability.................................... 81
Section 10.6 Administrative Agent Individually......................... 82
Section 10.7 Lender Credit Decision.................................... 82
Section 10.8 Expenses; Indemnities..................................... 83
Section 10.9 Resignation of Administrative Agent....................... 83
Section 10.10 Release of Collateral or Guarantors....................... 84
Section 10.11 Additional Secured Parties................................ 84
Section 10.12 Titles.................................................... 85
ARTICLE XI MISCELLANEOUS................................................... 85
Section 11.1 Amendments, Waivers, Etc.................................. 85
Section 11.2 Assignments and Participations; Binding Effect............ 86
Section 11.3 Costs and Expenses........................................ 89
Section 11.4 Indemnities............................................... 89
Section 11.5 Survival.................................................. 90
Section 11.6 Limitation of Liability for Certain Damages............... 90
Section 11.7 Lender-Creditor Relationship.............................. 91
Section 11.8 Right of Setoff........................................... 91
Section 11.9 Sharing of Payments, Etc.................................. 91
Section 11.10 Marshaling; Payments Set Aside............................ 92
Section 11.11 Notices................................................... 92
Section 11.12 Electronic Transmissions.................................. 93
Section 11.13 Governing Law............................................. 94
Section 11.14 Jurisdiction.............................................. 94
Section 11.15 Waiver of Jury Trial...................................... 94
Section 11.16 Severability.............................................. 94
Section 11.17 Execution in Counterparts................................. 95
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Section 11.18 Entire Agreement.......................................... 95
Section 11.19 Use of Name............................................... 95
Section 11.20 Non-Public Information; Confidentiality................... 95
Section 11.21 Patriot Act Notice........................................ 96
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SCHEDULES
Schedule I - Commitments
Schedule II - Addresses for Notices
Schedule 4.2 - Consents
Schedule 4.3(a) - Ownership of each Group Member and its Subsidiaries
Schedule 4.3(b) - P&G Joint Venture Documents
Schedule 4.4(b) - Material Liabilities or Obligations
Schedule 4.7 - Litigation
Schedule 4.8 - Taxes
Schedule 4.12 - Labor Matters
Schedule 4.13(a) - List of Plans - A
Schedule 4.13(b) - List of Plans - B
Schedule 4.14 - Environmental Matters
Schedule 4.15 - Intellectual Property
Schedule 4.16 - Real Property
Schedule 4.17 - Bank and Security Accounts
Schedule 4.18 - Insurance
Schedule 7.15 - Postclosing Deliveries
Schedule 8.1 - Existing Indebtedness
Schedule 8.1B Payoff Debt
Schedule 8.2 - Existing Liens
Schedule 8.3 - Existing Investments
Schedule 8.3A - Proposed Acquisitions
Schedule 8.8(b) - Holdings' Permitted Business
Schedule 8.9 - Transactions with Affiliates
EXHIBITS
Exhibit A - Form of Assignment
Exhibit B - Form of Note
Exhibit C - Form of Notice of Borrowing
Exhibit D - [Intentionally Omitted]
Exhibit E - [Intentionally Omitted]
Exhibit F - Form of Notice of Conversion or Continuation
Exhibit G - Form of Compliance Certificate
Exhibit H - Form of Guaranty and Security Agreement
Exhibit I - Form of Intercreditor Agreement
This Second Lien Credit Agreement, dated as of June 26, 2007, is
entered into among IM US HOLDINGS, LLC, a Delaware limited liability company
(the "Borrower"), INVERNESS MEDICAL INNOVATIONS, INC., a Delaware corporation
("Holdings"), the Lenders (as defined below), and GENERAL ELECTRIC CAPITAL
CORPORATION ("GE Capital"), as administrative agent and collateral agent for the
Lenders (in such capacity, and together with its successors and permitted
assigns, the "Administrative Agent"), UBS SECURITIES LLC, as Syndication Agent,
Joint Lead Arranger and Sole Bookrunner, and GE CAPITAL MARKETS, INC., as Joint
Lead Arranger.
The parties hereto agree as follows:
ARTICLE I
DEFINITIONS, INTERPRETATION AND ACCOUNTING TERMS
Defined Terms. As used in this Agreement, the following terms have the
following meanings:
"Acquisition" means the purchase by the AcquisitionCo of Target Shares
pursuant to the Tender Offer and the consummation of the Merger, in each case,
in accordance with the terms of the Acquisition Agreement.
"Acquisition Agreement" means the Agreement and Plan of Merger dated as of
May 17, 2007 among Holdings, AcquisitionCo and the Target.
"Acquisition Cash Collateral Account" means a deposit account in the name
of the Borrower and under the sole control (as defined in the applicable UCC) of
the Administrative Agent (subject to the rights of the First Lien Agent under
the First Lien Loan Documents and the Intercreditor Agreement), (i) established
if the Closing Date is not also the Merger Funding Date and (ii) into which the
Acquisition Cash Collateral Funds shall be deposited on the Closing Date and
applied in accordance with Section 2.19 (and otherwise from which the Borrower
may not make withdrawals except in accordance with Section 2.19 or as otherwise
permitted by the Administrative Agent).
"Acquisition Cash Collateral Funds" has the meaning specified in Section
7.9.
"AcquisitionCo" means Inca Acquisition, Inc., a Delaware corporation and a
Wholly Owned Subsidiary of Borrower.
"Affected Lender" has the meaning specified in Section 2.18.
"Affiliate" means, with respect to any Person, each officer, director,
general partner or joint-venturer of such Person and any other Person that
directly or indirectly controls, is controlled by, or is under common control
with, such Person; provided, however, that no Secured Party shall be an
Affiliate of the Borrower. For purpose of this definition, "control" means the
possession of either (a) the power to vote, or the beneficial ownership of, 10%
or more of the Voting Stock of such Person or (b) the power to direct or cause
the direction of the management and policies of such Person, whether by contract
or otherwise.
"Agreement" means this Second Lien Credit Agreement.
"Applicable Margin" means (a) with respect to Term Loans which are Base
Rate Loans, 3.25%, and (b) with respect to Term Loans which are Eurodollar Rate
Loans, 4.25%.
"Approved Fund" means, with respect to any Lender, any Person (other than a
natural Person) that (a) is or will be engaged in making, purchasing, holding or
otherwise investing in commercial loans and similar extensions of credit in the
ordinary course of its business and (b) is advised or managed by (i) such
Lender, (ii) any Affiliate of such Lender or (iii) any Person (other than an
individual) or any Affiliate of any Person (other than an individual) that
administers or manages such Lender.
"Assignment" means an assignment agreement entered into by a Lender, as
assignor, and any Person, as assignee, pursuant to the terms and provisions of
Section 11.2 (with the consent of any party whose consent is required by Section
11.2), accepted by the Administrative Agent, in substantially the form of
Exhibit A, or any other form approved by the Administrative Agent.
"Base Rate" means, at any time, a rate per annum equal to the higher of (a)
the rate last quoted by The Wall Street Journal as the latest "U.S. prime rate"
or, if The Wall Street Journal ceases to quote such rate, the highest per annum
interest rate published by the Federal Reserve Board in Federal Reserve
Statistical Release H.15 (519) (Selected Interest Rates) as the "bank prime
loan" rate or, if such rate is no longer quoted therein, any similar rate quoted
therein (as determined by the Administrative Agent) or any similar release by
the Federal Reserve Board (as determined by the Administrative Agent) and (b)
the sum of 0.5% per annum and the Federal Funds Rate.
"Base Rate Loan" means any Loan that bears interest based on the Base Rate.
"Benefit Plan" means any employee benefit plan as defined in Section 3(3)
of ERISA (whether governed by the laws of the United States or otherwise) to
which any Group Member incurs or otherwise has any obligation or liability,
contingent or otherwise.
"Borrowing" means a borrowing consisting of Terms Loans made on the Closing
Date by the Lenders according to their respective Term Loan Commitments under
the Term Loan Facility.
"Business Day" means any day of the year that is not a Saturday, Sunday or
a day on which banks are required or authorized to close in New York City and,
when determined in connection with notices and determinations in respect of any
Eurodollar Rate or Eurodollar Rate Loan or any funding, conversion,
continuation, Interest Period or payment of any Eurodollar Rate Loan, that is
also a day on which dealings in Dollar deposits are carried on in the London
interbank market.
"Capital Expenditures" means, for any Person for any period, the aggregate
of all expenditures, whether or not made through the incurrence of Indebtedness,
by such Person and its Subsidiaries during such period for the acquisition,
leasing (pursuant to a Capital Lease), construction, replacement, repair,
substitution or improvement of fixed or capital assets or additions to
equipment, in each case required to be capitalized under GAAP on a Consolidated
balance sheet of such Person, excluding (a) interest capitalized during
construction and (b) any expenditure to the extent, for purpose of the
definition of Permitted Acquisition, such expenditure is part of the aggregate
amounts payable in connection with, or other consideration for, any Permitted
Acquisition consummated during or prior to such period.
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"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) by such Person as lessee that has been or should be accounted for as a
capital lease on a balance sheet of such Person prepared in accordance with
GAAP.
"Capitalized Lease Obligations" means, at any time, with respect to any
Capital Lease, any lease entered into as part of any Sale and Leaseback
Transaction of any Person or any synthetic lease, the amount of all obligations
of such Person that is (or that would be, if such synthetic lease or other lease
were accounted for as a Capital Lease) capitalized on a balance sheet of such
Person prepared in accordance with GAAP.
"Cash Collateral Account" means a deposit account or securities account
(including the Acquisition Cash Collateral Account) in the name of a Loan Party
and under the sole control (as defined in the applicable UCC) of the
Administrative Agent (subject to the rights of the First Lien Agent under the
First Lien Loan Documents and the Intercreditor Agreement) and (a) in the case
of a deposit account, from which such Loan Party may not make withdrawals except
as permitted by the Administrative Agent and (b) in the case of a securities
account, with respect to which the Administrative Agent shall be the entitlement
holder and the only Person authorized to give entitlement orders with respect
thereto.
"Cash Equivalents" means (a) any readily-marketable securities (i) issued
by, or directly, unconditionally and fully guaranteed or insured by the United
States federal government or (ii) issued by any agency of the United States
federal government the obligations of which are fully backed by the full faith
and credit of the United States federal government, (b) any readily-marketable
direct obligations issued by any other agency of the United States federal
government, any state of the United States or any political subdivision of any
such state or any public instrumentality thereof, in each case having a rating
of at least "A-1" from S&P or at least "P-1" from Xxxxx'x, (c) any commercial
paper rated at least "A-1" by S&P or "P-1" by Xxxxx'x and issued by any Person
organized under the laws of any state of the United States, (d) any
Dollar-denominated time deposit, insured certificate of deposit, overnight bank
deposit or bankers' acceptance issued or accepted by (i) any Lender or (ii) any
commercial bank that is (A) organized under the laws of the United States, any
state thereof or the District of Columbia, (B) "adequately capitalized" (as
defined in the regulations of its primary federal banking regulators) and (C)
has Tier 1 capital (as defined in such regulations) in excess of $250,000,000,
(e) shares of any United States money market fund that (i) has substantially all
of its assets invested continuously in the types of investments referred to in
clause (a), (b), (c) or (d) above with maturities as set forth in the proviso
below, (ii) has net assets in excess of $500,000,000 and (iii) has obtained from
either S&P or Xxxxx'x the highest rating obtainable for money market funds in
the United States; provided, however, that the maturities of all obligations
specified in any of clauses (a), (b), (c) and (d) above shall not exceed 365
days, and (f) in the case of any Subsidiary organized in a jurisdiction outside
the United States: (i) direct obligations of the sovereign nation (or agency
thereof) in which such Subsidiary is organized and is conducting business or in
obligations fully and unconditionally guaranteed by such sovereign nation (or
any agency thereof), (ii) investments of the type and maturity described in
clauses (a) through (e) above of foreign obligors, which investments or obligors
(or the parents of such obligors) have ratings described in such clauses or
equivalent ratings from comparable foreign rating agencies or (iii) investments
of the type and maturity described in clauses (a) through (e) above of foreign
obligors (or the parents of such obligors), which investments or obligors (or
the parent of such obligors) are not rated as provided in such clauses or in
clause (ii) above but which are, in the reasonable judgment of Holdings,
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comparable in investment quality to such investments and obligors (or the
parents of such obligors).
"CERCLA" means the United States Comprehensive Environmental Response,
Compensation, and Liability Act (42 U.S.C. Sections 9601 et seq.).
"Change of Control" means the occurrence of any of the following: (a) any
person or group of persons (within the meaning of the Securities Exchange Act of
1934) shall have acquired beneficial ownership (within the meaning of Rule 13d-3
promulgated by the Securities and Exchange Commission under the Securities
Exchange Act of 1934,) of more than 50% of the issued and outstanding shares of
capital Stock of Holdings having the right to vote for the election of directors
of Holdings under ordinary circumstances; or (b) during any period of twelve
consecutive calendar months, individuals who at the beginning of such period
constituted the board of directors of Holdings (together with any new directors
whose election by the board of directors of Holdings or whose nomination for
election by the stockholders of Holdings was approved by a vote of at least
two-thirds of the directors then still in office who either were directors at
the beginning of such period or whose election or nomination for election was
previously so approved) cease for any reason other than death or disability to
constitute a majority of the directors then in office; or (c) Holdings shall
cease to own and control, legally and beneficially, all of the economic and
voting rights associated with ownership of all outstanding Voting Stock of all
classes of Voting Stock of Borrower; (d) a "Change of Control" or any term of
similar effect, as defined in the First Lien Credit Agreement; or (e) a
"Fundamental Change" or "Termination of Trading" or any term of similar effect,
as defined in the Subordinated Convertible Notes Indenture, shall occur.
"Cholestech" means Cholestech Corporation, a California corporation.
"Cholestech Acquisition" means the acquisition of Cholestech pursuant to
the merger of Iris Merger Sub, Inc., a California corporation, with and into
Cholestech in accordance with the Cholestech Acquisition Agreement.
"Cholestech Acquisition Agreement" means that certain Agreement and Plan of
Reorganization, dated as of June 4, 2007, by and among Holdings, Iris Merger
Sub, Inc., a California corporation, and Cholestech.
"Closing Date" means the first date on which any Loan is made or any Letter
of Credit is Issued, which shall be the date that AcquisitionCo acquires any
Target Shares pursuant to the Tender Offer.
"Code" means the U.S. Internal Revenue Code of 1986, as amended from time
to time, and any regulations promulgated thereunder.
"Collateral" means all property and interests in property and proceeds
thereof now owned or hereafter acquired by any Loan Party in or upon which a
Lien is granted or purported to be granted pursuant to any Loan Document.
"Commitment" means, with respect to any Lender, such Lender's Term Loan
Commitment.
"Compliance Certificate" means a certificate substantially in the form of
Exhibit G.
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"Consolidated" means, with respect to any Person, the accounts of such
Person and its Subsidiaries consolidated in accordance with GAAP.
"Consolidated Cash Interest Expense" means, with respect to any Person for
any period, the Consolidated Interest Expense of such Person for such period
less the sum of, in each case to the extent included in the definition of
Consolidated Interest Expense, (a) the amortized amount of debt discount and
debt issuance costs, (b) charges relating to write-ups or write-downs in the
book or carrying value of existing Consolidated Total Debt, (c) interest payable
in evidences of Indebtedness or by addition to the principal of the related
Indebtedness and (d) other non-cash interest; provided that Consolidated
Interest Expense for the 4 Fiscal Quarter period ending (i) September 30, 2007
shall be the actual Consolidated Interest Expense for the Fiscal Quarter then
ended multiplied by 4, (ii) December 31, 2007 shall be the actual Consolidated
Interest Expense for two Fiscal Quarters then ended multiplied by 2, and (iii)
March 31, 2008 shall be the actual Consolidated Interest Expense for three
Fiscal Quarters then ended multiplied by 4/3.
"Consolidated Current Assets" means, with respect to any Person at any
date, the total Consolidated current assets of such Person at such date other
than cash, Cash Equivalents and any Indebtedness owing to such Person or any of
its Subsidiaries by Affiliates of such Person.
"Consolidated Current Liabilities" means, with respect to any Person at any
date, all liabilities of such Person and its Subsidiaries at such date that
should be classified as current liabilities on a Consolidated balance sheet of
such Person; provided, however, that "Consolidated Current Liabilities" shall
exclude the principal amount of the Loans then outstanding.
"Consolidated EBITDA" means, with respect to any Person for any period, (a)
the Consolidated Net Income of such Person for such period plus (b) the sum of,
in each case to the extent included in the calculation of such Consolidated Net
Income but without duplication, (i) any provision for income taxes or other
taxes measured by net income, (ii) Consolidated Interest Expense, amortization
of debt discount and commissions and other fees and charges associated with
Indebtedness, (iii) any loss from extraordinary items and any non-recurring
loss, (iv) any depreciation, depletion and amortization expense, (v) any
aggregate net loss on the Sale of property (other than accounts (as defined
under the applicable UCC) and inventory) outside the ordinary course of
business, (vi) any other non-cash expenditure, charge or loss for such period
(other than any non-cash expenditure, charge or loss relating to write-offs,
write-downs or reserves with respect to accounts and inventory), including the
amount of any compensation deduction as the result of any grant of Stock or
Stock Equivalents to employees, officers, directors or consultants, (vii) for
each of the 4 Fiscal Quarter periods ending September 30, 2007, December 31,
2007, March 31, 2008 and June 30, 2008 the following cost savings amounts:
$28,000,000, $20,000,000, $10,000,000 and $0, respectively and as applicable,
and (viii) if the Cholestech Acquisition has been consummated, for the 4 Fiscal
Quarter period ending on the last day of the Fiscal Quarter in which the
Cholestech Acquisition has been consummated and for the immediately succeeding
three 4 Fiscal Quarter periods thereafter, the following cost savings amounts:
$6,000,000, $5,600,000, $4,000,000 and $2,000,000, respectively and as
applicable, and minus (c) the sum of, in each case to the extent included in the
calculation of such Consolidated Net Income and without duplication, (i) any
credit for income taxes or other taxes measured by net income, (ii) any interest
income, (iii) any gain from extraordinary items and any other non-recurring
gain, (iv) any aggregate net gain from the Sale of property (other than accounts
(as defined in the applicable UCC) and inventory) out of the ordinary course of
business by such Person, (v) any other non-cash gain, including any reversal of
a charge referred to in clause (b)(vi) above by reason of a decrease in the
value of any Stock or Stock Equivalent, and
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(vi) any other cash payment in respect of expenditures, charges and losses that
have been added to Consolidated EBITDA of such Person pursuant to clause (b)(vi)
above in any prior period; provided that Consolidated EBITDA for the Fiscal
Quarters ended December 31, 2006 and March 31, 2007 shall be deemed to be (A) at
any time prior to consummation of the Cholestech Acquisition, $43,877,000 and
$46,972,200, respectively, and (B) at any time after consummation of the
Cholestech Acquisition, $48,437,000 and $51,296,200, respectively.
"Consolidated Interest Coverage Ratio" means, with respect to any Person
for any period, the ratio of (a) Consolidated EBITDA of such Person for such
period to (b) Consolidated Cash Interest Expense of such Person for such period.
"Consolidated Interest Expense" means, for any Person for any period, (a)
Consolidated total interest expense of such Person and its Subsidiaries for such
period and including, in any event, (i) interest capitalized during such period
and net costs under Interest Rate Contracts for such period and (ii) all fees,
charges, commissions, discounts and other similar obligations (other than
reimbursement obligations) with respect to letters of credit, bank guarantees,
banker's acceptances, surety bonds and performance bonds (whether or not
matured) payable by such Person and its Subsidiaries during such period minus
(b) Consolidated net gains of such Person and its Subsidiaries under Interest
Rate Contracts for such period.
"Consolidated Leverage Ratio" means, with respect to any Person as of any
date, the ratio of (a) Consolidated Total Debt of such Person outstanding as of
such date to (b) Consolidated EBITDA for such Person for the last period of four
consecutive Fiscal Quarters ending on or before such date.
"Consolidated Net Income" means, with respect to any Person, for any
period, the Consolidated net income (or loss) of such Person and its
Subsidiaries for such period; provided, however, that the following shall be
excluded: (a) the net income of any other Person in which such Person or one of
its Subsidiaries has a joint interest with a third-party (which interest does
not cause the net income of such other Person to be Consolidated into the net
income of such Person), except to the extent of the amount of dividends or
distributions paid to such Person or Subsidiary, (b) the net income of any
Subsidiary of such Person that is, on the last day of such period, subject to
any restriction or limitation on the payment of dividends or the making of other
distributions (other than under the Loan Documents), to the extent of such
restriction or limitation, and (c) the net income of any other Person arising
prior to such other Person becoming a Subsidiary of such Person or merging or
consolidating into such Person or its Subsidiaries and (d) consolidated minority
interest expense of such Person or one of its Subsidiaries resulting from
allocations of earnings of any Consolidated Subsidiary which is less than 100%
owned, except to the extent of the amount of dividends or distributions paid by
such Person or Subsidiary to the minority shareholders of such Consolidated
Subsidiary.
"Consolidated Total Debt" of any Person means all Indebtedness of a type
described in clause (a), (b), (c)(i), (d) or (f) of the definition thereof and
all Guaranty Obligations with respect to any such Indebtedness, in each case of
such Person and its Subsidiaries on a Consolidated basis.
"Constituent Documents" means, with respect to any Person, collectively
and, in each case, together with any modification of any term thereof, (a) the
articles of incorporation, certificate of incorporation, constitution or
certificate of formation of such Person, (b) the bylaws, operating agreement or
joint venture agreement of such Person, (c) any other constitutive,
6
organizational or governing document of such Person, whether or not equivalent,
and (d) any other document setting forth the manner of election or duties of the
directors, officers or managing members of such Person or the designation,
amount or relative rights, limitations and preferences of any Stock of such
Person.
"Contractual Obligation" means, with respect to any Person, any provision
of any Security issued by such Person or of any document or undertaking (other
than a Loan Document) to which such Person is a party or by which it or any of
its property is bound or to which any of its property is subject.
"Control Agreement" means, with respect to any deposit account, any
securities account, commodity account, securities entitlement or commodity
contract, an agreement, in form and substance satisfactory to the Administrative
Agent, among the Administrative Agent, the financial institution or other Person
at which such account is maintained or with which such entitlement or contract
is carried and the Loan Party maintaining such account, entitlement or contract,
effective to grant "control" (as defined under the applicable UCC) over such
account, entitlement or contract, to the Administrative Agent (subject to the
rights of the First Lien Agent under the First Lien Loan Documents and the
Intercreditor Agreement).
"Controlled Deposit Account" means each deposit account (including all
funds on deposit therein) that is the subject of an effective Control Agreement
and that is maintained by any Loan Party with a financial institution approved
by the Administrative Agent (such approval not to be unreasonably withheld).
"Controlled Securities Account" means each securities account or commodity
account (including all financial assets held therein and all certificates and
instruments, if any, representing or evidencing such financial assets) that is
the subject of an effective Control Agreement and that is maintained by any Loan
Party with a securities intermediary or commodity intermediary approved by the
Administrative Agent (such approval not to be unreasonably withheld).
"Copyrights" means all right, title and interest (and all related IP
Ancillary Rights) arising under any Requirement of Law in or relating to
copyrights and all mask work, database and design rights, whether or not
registered or published, all registrations thereof and all applications
therefor.
"Corporate Chart" means a document in form reasonably acceptable to the
Administrative Agent and setting forth, as of a date set forth therein, for each
Person that is a Loan Party, that is subject to Section 7.10 or that is a
Subsidiary or joint venture of any of them, (a) the full legal name of such
Person, (b) the jurisdiction of organization and, in the case of any Loan Party,
any organizational number and tax identification number of such Person, (c) in
the case of any Loan Party, the location of such Person's chief executive office
(or, if applicable, sole place of business) and (d) the percentage of
outstanding shares of each class of Stock of such Person (other than Holdings)
owned, directly or indirectly, by any Loan Party or any Subsidiary of any of
them.
"Customary Permitted Liens" means, with respect to any Person, any of the
following:
(a) Liens (i) with respect to the payment of taxes, assessments or other
governmental charges or (ii) of suppliers, carriers, materialmen, warehousemen,
workmen or mechanics and other similar Liens, in each case imposed by law or
arising in the ordinary course of business,
7
and, for each of the Liens in clauses (i) and (ii) above for amounts that are
not yet due or that are being contested in good faith by appropriate proceedings
diligently conducted and with respect to which adequate reserves or other
appropriate provisions are maintained on the books of such Person in accordance
with GAAP;
(b) (i) Liens of a collection bank on items in the course of collection
arising under Section 4-208 of the UCC as in effect in the State of New York or
any similar section under any applicable UCC or any similar Requirement of Law
of any foreign jurisdiction or (ii) other rights of setoff or banker's liens in
favor of banks or other depository institutions arising in the ordinary course
of business;
(c) pledges or cash deposits made in the ordinary course of business (i) in
connection with workers' compensation, unemployment insurance, social security
or other types of governmental insurance benefits (other than any Lien imposed
by ERISA), (ii) to secure the performance of bids, tenders, leases (other than
Capital Leases) sales or other trade contracts (other than for the repayment of
borrowed money) or (iii) made in lieu of, or to secure the performance of,
surety, customs, reclamation or performance bonds (in each case not related to
judgments or litigation);
(d) judgment liens (other than for the payment of taxes, assessments or
other governmental charges) securing judgments and other proceedings not
constituting an Event of Default under Section 9.1(f) and pledges or cash
deposits made in lieu of, or to secure the performance of, judgment or appeal
bonds in respect of such judgments and proceedings;
(e) Liens (i) arising by reason of zoning restrictions, easements,
licenses, reservations, restrictions, covenants, rights-of-way, encroachments,
minor defects or irregularities in title (including leasehold title) and other
similar encumbrances on the use of real property or (ii) consisting of leases,
licenses or subleases (other than Capital Leases) granted by a lessor, licensor
or sublessor on its real property in the ordinary course of business that, for
each of the Liens in clauses (i) and (ii) above, do not, in the aggregate,
materially (x) impair the use or occupancy of such real property or (y)
interfere with the ordinary conduct of the business conducted by the Loan
Parties at such real property;
(f) Liens of landlords and mortgagees of landlords (i) arising by statute
or under any lease or related Contractual Obligation entered into in the
ordinary course of business, (ii) on fixtures and movable tangible property
located on the real property leased or subleased from such landlord, (iii) for
amounts not overdue or that are being contested in good faith by appropriate
proceedings diligently conducted and (iv) for which adequate reserves or other
appropriate provisions are maintained on the books of such Person in accordance
with GAAP;
(g) the title and interest of a lessor or sublessor in and to personal
property leased or subleased (other than through a Capital Lease), in each case
extending only to such personal property;
(h) licenses and sublicenses of intellectual property granted to third
parties in the ordinary course of business that do not, in the aggregate,
materially (x) impair the use of such intellectual property or (y) interfere
with the ordinary conduct of the business conducted by the Loan Parties with
such intellectual property; and
8
(i) precautionary financing statements filed in connection with operating
leases or other transactions that are not secured transactions.
"Default" means any event that, with the passing of time or the giving of
notice or both, would become an Event of Default.
"Disclosure Documents" means, collectively, (a) all confidential
information memoranda and related materials prepared in connection with the
syndication of the Term Loan Facility and (b) all other documents filed by any
Group Member with the United States Securities and Exchange Commission.
"Dollars" and the sign "$" each mean the lawful money of the United States
of America.
"Domestic Person" means any "United States person" under and as defined in
Section 770l(a)(30) of the Code.
"E-Fax" means any system used to receive or transmit faxes electronically.
"Electronic Transmission" means each document, instruction, authorization,
file, information and any other communication transmitted, posted or otherwise
made or communicated by e-mail or E-Fax, or otherwise to or from an E-System or
other equivalent service.
"Eligible Assignee" has the meaning specified in Section 11.2.
"Environmental Laws" means all Requirements of Law and Permits imposing
liability or standards of conduct for or relating to the regulation and
protection of human health, safety, the environment and natural resources,
including CERCLA, the SWDA, the Hazardous Materials Transportation Act (49
U.S.C. Sections 5101 et seq.), the Federal Insecticide, Fungicide, and
Rodenticide Act (7 U.S.C. Sections 136 et seq.), the Toxic Substances Control
Act (15 U.S.C. Sections 2601 et seq.), the Clean Air Act (42 U.S.C. Sections
7401 et seq.), the Federal Water Pollution Control Act (33 U.S.C. Sections 1251
et seq.), the Occupational Safety and Health Act (29 U.S.C. Sections 651 et
seq.), the Safe Drinking Water Act (42 U.S.C. Sections 300(f) et seq.), all
regulations promulgated under any of the foregoing, all analogous Requirements
of Law and Permits and any environmental transfer of ownership notification or
approval statutes, including the Industrial Site Recovery Act (N.J. Stat. Xxx.
Sections 13:1K-6 et seq.).
"Environmental Liabilities" means all Liabilities (including costs of
Remedial Actions, natural resource damages and costs and expenses of
investigation and feasibility studies) that may be imposed on, incurred by or
asserted against any Group Member as a result of, or related to, any claim,
suit, action, investigation, proceeding or demand by any Person, whether based
in contract, tort, implied or express warranty, strict liability, criminal or
civil statute or common law or otherwise, arising under any Environmental Law or
in connection with any environmental, health or safety condition or with any
Release and resulting from the ownership, lease, sublease or other operation or
occupation of property by any Group Member, whether on, prior or after the date
hereof.
"ERISA" means the United States Employee Retirement Income Security Act of
1974, as amended from time to time, and any regulations promulgated thereunder.
9
"ERISA Affiliate" means, collectively, any Group Member, and any Person
under common control, or treated as a single employer, with any Group Member,
within the meaning of Section 414(b), (c), (m) or (o) of the Code.
"ERISA Event" means any of the following: (a) a reportable event described
in Section 4043(b) of ERISA (or, unless the 30-day notice requirement has been
duly waived under the applicable regulations, Section 4043(c) of ERISA) with
respect to a Title IV Plan; (b) the withdrawal of any ERISA Affiliate from a
Title IV Plan subject to Section 4063 of ERISA during a plan year in which it
was a substantial employer, as defined in Section 4001(a)(2) of ERISA; (c) the
complete or partial withdrawal of any ERISA Affiliate from any Multiemployer
Plan; (d) with respect to any Multiemployer Plan, the filing of a notice of
reorganization, insolvency or termination (or treatment of a plan amendment as
termination) under Section 4041A of ERISA, (e) the filing of a notice of intent
to terminate a Title IV Plan (or treatment of a plan amendment as termination)
under Section 4041 of ERISA, (f) the institution of proceedings to terminate a
Title IV Plan or Multiemployer Plan by the PBGC, (g) the failure to make any
required contribution to any Title IV Plan or Multiemployer Plan when due, (h)
the imposition of a lien under Section 412 of the Code or Section 302 or 4068 of
ERISA on any property (or rights to property, whether real or personal) of any
ERISA Affiliate, (i) the failure of a Benefit Plan or any trust thereunder
intended to qualify for tax exempt status under Section 401 or 501 of the Code
or other Requirements of Law to qualify thereunder, (j) a Title IV Plan is in
"at risk status" within the meaning of Code Section 430(i); (l) a Multiemployer
Plan is in "endangered status" or "critical status" within the meaning of Code
Section 432(b); (m) an ERISA Affiliate incurs a substantial cessation of
operations within the meaning of ERISA Section 4062(e), with respect to a Title
IV Plan; or (n) any other event or condition that might reasonably be expected
to constitute grounds under Section 4042 of ERISA for the termination of, or the
appointment of a trustee to administer, any Title IV Plan or Multiemployer Plan
or for the imposition of any liability upon any ERISA Affiliate under Title IV
of ERISA other than for PBGC premiums due but not delinquent.
"E-Signature" means the process of attaching to or logically associating
with an Electronic Transmission an electronic symbol, encryption, digital
signature or process (including the name or an abbreviation of the name of the
party transmitting the Electronic Transmission) with the intent to sign,
authenticate or accept such Electronic Transmission.
"E-System" means any electronic system, including Intralinks(R) and
ClearPar(R) and any other Internet or extranet-based site, whether such
electronic system is owned, operated or hosted by the Administrative Agent, any
of its Related Persons or any other Person, providing for access to data
protected by passcodes or other security system.
"Eurodollar Base Rate" means, with respect to any Interest Period for any
Eurodollar Rate Loan, the rate determined by the Administrative Agent to be the
offered rate for deposits in Dollars for the applicable Interest Period
appearing on the Reuters Screen LIBOR01 page as of 11:00 a.m. (London time) on
the second full Business Day next preceding the first day of each Interest
Period. In the event that such rate does not appear on the Reuters Screen
LIBOR01 page (or otherwise on the Reuters screen) at such time, the "Eurodollar
Base Rate" shall be determined by reference to such other comparable publicly
available service for displaying the offered rate for deposit in Dollars in the
London interbank market as may be selected by the Administrative Agent and, in
the absence of availability, such other method to determine such offered rate as
may be selected by the Administrative Agent in its sole discretion.
10
"Eurodollar Rate" means, with respect to any Interest Period and for any
Eurodollar Rate Loan, an interest rate per annum determined as the ratio of (a)
the Eurodollar Base Rate with respect to such Interest Period for such
Eurodollar Rate Loan to (b) the difference between the number one and the
Eurodollar Reserve Requirements with respect to such Interest Period and for
such Eurodollar Rate Loan.
"Eurodollar Rate Loan" means any Loan that bears interest based on the
Eurodollar Rate.
"Eurodollar Reserve Requirements" means, with respect to any Interest
Period and for any Eurodollar Rate Loan, a rate per annum equal to the
aggregate, without duplication, of the maximum rates (expressed as a decimal
number) of reserve requirements in effect 2 Business Days prior to the first day
of such Interest Period (including basic, supplemental, marginal and emergency
reserves) under any regulations of the Federal Reserve Board or other
Governmental Authority having jurisdiction with respect thereto dealing with
reserve requirements prescribed for eurocurrency funding (currently referred to
as "eurocurrency liabilities" in Regulation D of the Federal Reserve Board)
maintained by a member bank of the United States Federal Reserve System.
"Event of Default" has the meaning specified in Section 9.1.
"Excess Cash Flow" means, for any period, (a) Consolidated EBITDA of
Holdings for such period, minus (b) without duplication, (i) (A) any cash
principal payment on the First Lien Loans during such period (but only, in the
case of payment in respect of First Lien Revolving Loans, to the extent that the
related revolving loan commitments are permanently reduced by the amount of such
payment), and (B) any cash principal payment on the Loans during such period
other than any mandatory prepayment required pursuant to Section 2.8(a) because
of the existence of Excess Cash Flow, (ii) any scheduled or other mandatory cash
principal payment made by the Borrower or any of its Subsidiaries during such
period on any Capitalized Lease Obligation or other Indebtedness (but only, if
such Indebtedness may be reborrowed, to the extent such payment results in a
permanent reduction in commitments thereof), (iii) any Capital Expenditure made
by Holdings or any of its Subsidiaries during such period to the extent
permitted by this Agreement, excluding the portion thereof financed with
long-term Indebtedness (other than the Obligations), (iv) the Consolidated Cash
Interest Expense of Holdings and its Subsidiaries for such period, (v) any cash
losses from extraordinary items, (vi) any cash paid during such period or
payable with respect to such period to satisfy obligations for income taxes or
other taxes measured by net income, (vii) cash restructuring costs associated
with the Acquisition or any Permitted Acquisition, (viii) any Permitted
Acquisition Consideration paid in cash and any Investments pursuant to Section
8.3 (j) or (k) made in cash, in each case, by Holdings or any of its
Subsidiaries during such period to the extent permitted by this Agreement but
excluding the portion thereof financed with long-term Indebtedness (other than
the Obligations) or with proceeds of the issuance of common stock of Holdings,
and (ix) any increase in the Working Capital of Holdings during such period
(measured as the excess of such Working Capital at the end of such period over
such Working Capital at the beginning of such period) and plus (c) without
duplication, any decrease in the Working Capital of Holdings during such period
(measured as the excess of such Working Capital at the beginning of such period
over such Working Capital at the end thereof).
"Excluded Foreign Subsidiary" means any Subsidiary of Holdings that is not
a Domestic Person and in respect of which any of (a) the pledge of any of the
Stock of such Subsidiary as Collateral for any Obligations of any Loan Party,
(b) the grant by such Subsidiary of a Lien on
11
any of its property as Collateral for any Obligations of any Loan Party or (c)
such Subsidiary incurring Guaranty Obligations with respect to any Obligations
of any Loan Party or any Domestic Person would, in the good faith judgment of
Holdings, result in incremental material adverse tax consequences to the Loan
Parties and their Subsidiaries; provided, however, that (x) the Administrative
Agent and Holdings may agree that, despite the foregoing, any such Subsidiary
shall not be an "Excluded Foreign Subsidiary" and (y) no such Subsidiary shall
be an "Excluded Foreign Subsidiary" if, with substantially similar tax
consequences, such Subsidiary has entered into any Guaranty Obligations with
respect to, such Subsidiary has granted a security interest in any of its
property to secure, or more than 66 2/3% of the Voting Stock of such Subsidiary
was pledged to secure, directly or indirectly, any Indebtedness (other than the
Obligations) of any Loan Party. "Excluded Foreign Subsidiary" also means
Inverness Medical Investments, LLC.
"Excluded Sales" has the meaning specified in Section 2.8(c).
"Excluded Taxes" has the meaning specified in Section 2.17(a).
"Existing Agent" means General Electric Capital Corporation, in its
capacity as administrative agent under the Existing Credit Agreement.
"Existing Credit Agreement" means that certain Third Amended and Restated
Credit Agreement, dated as of June 30, 2005, among Holdings, Xxxxxxx
Laboratories, LLC, Inverness Medical Holdings (UK) Limited, the lenders party
thereto, the Existing Agent, Xxxxxxx Xxxxx Capital, as documentation agent and
co-syndication agent, UBS Securities LLC, as co-syndication agent, and GECC
Capital Markets Group Inc. and Xxxxxxx Xxxxx Capital, as co-lead arrangers, as
amended from time to time.
"Existing Subordinated Notes" means the 8 3/4% senior subordinated notes
due 2012 of Holdings in an original aggregate principal amount of $150,000,000,
issued pursuant to the Indenture, dated as of February 10, 2004, among Holdings,
the Guarantors named therein and U.S. Bank Trust National Association, as
trustee.
"Federal Funds Rate" means, for any period, a fluctuating interest rate per
annum equal for each day during such period to the weighted average of the rates
on overnight federal funds transactions with members of the Federal Reserve
System arranged by federal funds brokers, as determined by the Administrative
Agent in its sole discretion.
"Federal Reserve Board" means the Board of Governors of the United States
Federal Reserve System and any successor thereto.
"Fee Letter" means the letter agreement, dated as of June 5, 2007 addressed
to Holdings from the Administrative Agent and UBS Loan Finance LLC and accepted
by Holdings, with respect to certain fees to be paid from time to time to the
Administrative Agent and UBS Loan Finance LLC.
"Financial Statement" means each financial statement delivered pursuant to
Section 4.4 or 6.1.
12
"First Lien Administrative Agent" means GE Capital, in its capacity as
administrative agent for the secured parties under the First Lien Loan
Documents, or any successor administrative agent in accordance with the terms
thereof.
"First Lien Credit Agreement" means the First Lien Credit Agreement, dated
as of the date hereof, among Holdings, the Borrower, the First Lien
Administrative Agent, and the other agents and lenders party thereto.
"First Lien Loan Documents" means the First Lien Credit Agreement and the
related guarantees, pledge agreements, security agreements, mortgages, notes and
other agreements and instruments entered into in connection with the First Lien
Credit Agreement.
"First Lien Obligations" means the "Obligations", as defined in the First
Lien Credit Agreement as in effect as of the date hereof.
"First Lien Revolving Loans" means the revolving loans made to the Borrower
pursuant to the First Lien Credit Agreement.
"First Lien Revolving Credit Commitments" means the "Revolving Credit
Commitments", as defined in the First Lien Credit Agreement.
"First Lien Term Loans" means the term loans in an aggregate principal
amount of $900,000,000 made to the Borrower on the Closing Date pursuant to
the First Lien Credit Agreement.
"Fiscal Quarter" means each 3 fiscal month period ending on March 31, June
30, September 30 or December 31.
"Fiscal Year" means the twelve-month period ending on December 31.
"GAAP" means generally accepted accounting principles in the United States
of America, as in effect from time to time, set forth in the opinions and
pronouncements of the Accounting Principles Board and the American Institute of
Certified Public Accountants, in the statements and pronouncements of the
Financial Accounting Standards Board and in such other statements by such other
entity as may be in general use by significant segments of the accounting
profession that are applicable to the circumstances as of the date of
determination. Subject to Section 1.3, all references to "GAAP" shall be to GAAP
applied consistently with the principles used in the preparation of the
Financial Statements described in Section 4.4(a).
"Governmental Authority" means any nation, sovereign or government, any
state or other political subdivision thereof, any agency, authority or
instrumentality thereof and any entity or authority exercising executive,
legislative, taxing, judicial, regulatory or administrative functions of or
pertaining to government, including any central bank, stock exchange, regulatory
body, arbitrator, public sector entity, supra-national entity (including the
European Union and the European Central Bank) and any self-regulatory
organization (including the National Association of Insurance Commissioners).
"Group Member Cash Payment" has the meaning specified in Section 3.1(f).
13
"Group Members" means, collectively, Holdings and each of its Subsidiaries,
including on and after the Closing Date, the Target and its Subsidiaries.
"Group Members' Accountants" means BDO Xxxxxxx, LLP or other
nationally-recognized independent registered certified public accountants.
"Guarantor" means Holdings, each Subsidiary of Holdings listed on Schedule
4.3(a) that is not an Excluded Foreign Subsidiary and each other Person that
enters into any Guaranty Obligation with respect to any Obligation of any Loan
Party. Iris Merger Sub, Inc. shall not be a Guarantor prior to the consummation
of the Cholestech Acquisition.
"Guaranty and Security Agreement" means a second lien guaranty and security
agreement, in substantially the form of Exhibit H, among the Administrative
Agent, the Borrower and the Guarantors from time to time party thereto.
"Guaranty Obligation" means, as applied to any Person, any direct or
indirect liability, contingent or otherwise, of such Person for any
Indebtedness, lease, dividend or other obligation (the "primary obligation") of
another Person (the "primary obligor"), if the purpose or intent of such Person
in incurring such liability, or the economic effect thereof, is to guarantee
such primary obligation or provide support or assurance to the holder of such
primary obligation or to protect or indemnify such holder against loss with
respect to such primary obligation, including (a) the direct or indirect
guaranty, endorsement (other than for collection or deposit in the ordinary
course of business), co-making, discounting with recourse or sale with recourse
by such Person of any primary obligation, (b) the incurrence of reimbursement
obligations with respect to any letter of credit or bank guarantee in support of
any primary obligation, (c) the existence of any Lien, or any right, contingent
or otherwise, to receive a Lien, on the property of such Person securing any
part of any primary obligation (but only to the extent of the value of such
property securing such obligation) and (d) any liability of such Person for a
primary obligation through any Contractual Obligation (contingent or otherwise)
or other arrangement (i) to purchase, repurchase or otherwise acquire such
primary obligation or any security therefor or to provide funds for the payment
or discharge of such primary obligation (whether in the form of a loan, advance,
stock purchase, capital contribution or otherwise), (ii) to maintain the
solvency, working capital, equity capital or any balance sheet item, level of
income or cash flow, liquidity or financial condition of any primary obligor,
(iii) to make take-or-pay or similar payments, if required, regardless of
non-performance by any other party to any Contractual Obligation, (iv) to
purchase, sell or lease (as lessor or lessee) any property, or to purchase or
sell services, primarily for the purpose of enabling the primary obligor to
satisfy such primary obligation or to protect the holder of such primary
obligation against loss or (v) to supply funds to or in any other manner invest
in, such primary obligor (including to pay for property or services irrespective
of whether such property is received or such services are rendered) for the
purpose of enabling the primary obligor to satisfy such primary obligation;
provided, however, that "Guaranty Obligations" shall not include (x)
endorsements for collection or deposit in the ordinary course of business and
(y) product warranties given in the ordinary course of business. The outstanding
amount of any Guaranty Obligation shall equal the outstanding amount of the
primary obligation so guaranteed or otherwise supported or, if lower, the stated
maximum reasonably anticipated amount for which such Person may be liable under
such Guaranty Obligation.
"Hazardous Material" means any substance, material or waste that is
classified, regulated or otherwise characterized under any Environmental Law as
hazardous, toxic, a contaminant or a
14
pollutant or by other words of similar meaning or regulatory effect, including
petroleum or any fraction thereof, asbestos, polychlorinated biphenyls and
radioactive substances.
"Healthcare Laws" means (a) Federal Food, Drug and Cosmetic Act as
interpreted and enforced by the U.S. Food and Drug Administration, (b) all
federal and state fraud and abuse laws, including, but not limited to the
federal Anti-Kickback Statute (42 U.S.C. Section 1320a-7(b)), the federal Ethics
in Patient Referrals Act (42 U.S.C. Sections 1395mm et. seq.), the Xxxxx Law (42
U.S.C. Section 1395nn and Section 1395(q)), the civil False Claims Act (31
U.S.C. Section 3729 et. seq.), TRICARE (10 U.S.C. Section 1071 et. seq.),
Sections 1320a-7 and 1320a-7a of Title 42 of the United States Code and the
regulations promulgated pursuant to such statutes; (c) the Health Insurance
Portability and Accountability Act of 1996 (Pub. L. No. 104-191) and the
regulations promulgated thereunder; (d) Medicare (Title XVIII of the Social
Security Act) and the regulations promulgated thereunder; (e) Medicaid (Title
XIX of the Social Security Act) and the regulations promulgated thereunder; (f)
quality, safety and accreditation standards and requirements of all applicable
state laws or regulatory bodies; (g) licensure laws and regulations; and (h) any
and all other applicable medical, medical devices or health care laws,
regulations, manual provisions, policies and administrative guidance, each of
(a) through (g) as may be amended from time to time.
"Hedging Agreement" means any Interest Rate Contract, foreign exchange,
swap, option or forward contract, spot, cap, floor or collar transaction, any
other derivative instrument and any other similar speculative transaction and
any other similar agreement or arrangement designed to alter the risks of any
Person arising from fluctuations in any underlying variable.
"Immaterial Subsidiary" means any Group Member which (a) generated less
than 5% of the consolidated revenues of Holdings and its Subsidiaries for the
fiscal period most recently ended and (b) owned less than 5% of the assets (as
determined on a book value basis) of Holdings and its Subsidiaries on a
consolidated basis for such fiscal period; provided that no Group Member which
otherwise satisfies the criteria set forth in clauses (a) and (b) above shall be
treated as an Immaterial Subsidiary in this Agreement if (x) the aggregate
revenues generated by all Immaterial Subsidiaries would exceed 10% of the
consolidated revenues of Holdings and its Subsidiaries for the fiscal period
most recently ended or (y) all Immaterial Subsidiaries own more than 10% of the
assets of Holdings and its Subsidiaries on a consolidated basis, in each case
after including such Group Member as an Immaterial Subsidiary for purposes of
calculating compliance with clauses (x) and (y) above.
"Inactive Subsidiaries" means, collectively (a) Advantage Diagnostics
Corporation, a Delaware corporation; (b) Applied Biotech, Inc., a California
corporation; (c) Forefront Diagnostics, Inc., a California corporation; (d)
Innovations Research, LLC, a Delaware limited liability company; (e) Instant
Technologies OTC, Inc., a California corporation; and (f) Unipath Online, Inc.,
a Massachusetts corporation.
"Indebtedness" of any Person means, without duplication, any of the
following, whether or not matured: (a) all indebtedness for borrowed money, (b)
all obligations evidenced by notes, bonds, debentures or similar instruments,
(c) all reimbursement and all obligations with respect to (i) letters of credit,
bank guarantees or bankers' acceptances or (ii) surety, customs, reclamation or
performance bonds (in each case not related to judgments or litigation) other
than those entered into in the ordinary course of business, (d) all obligations
to pay the deferred purchase price of property or services (other than trade
payables incurred in the ordinary course of business that are unsecured and
customary adjustments of purchase price, contingent payments, earnout payments
15
or similar obligations of any Group Member arising under any of the documents
pertaining to a merger or acquisition or a Sale), (e) all obligations created or
arising under any conditional sale or other title retention agreement,
regardless of whether the rights and remedies of the seller or lender under such
agreement in the event of default are limited to repossession or sale of such
property, (f) all Capitalized Lease Obligations, (g) all obligations, whether or
not contingent, to purchase, redeem, retire, defease or otherwise acquire for
value, or pay any dividends or other amounts with respect to, any of its own
Stock or Stock Equivalents (or any Stock or Stock Equivalent of a direct or
indirect parent entity thereof), in each case, prior to the date that is 180
days after the Scheduled Term Loan Maturity Date, valued at, in the case of
redeemable preferred Stock, the greater of the voluntary liquidation preference
and the involuntary liquidation preference of such Stock plus accrued and unpaid
dividends, (h) the net amount of all payments that would be required to be made
in respect of any Hedging Agreement in the event of a termination (including an
early termination) on the date of determination, and (i) all Guaranty
Obligations for obligations of any other Person constituting Indebtedness of
such other Person; provided, however, that the items in each of clauses (a)
through (h) above shall constitute "Indebtedness" of such Person solely to the
extent, directly or indirectly, (x) such Person is liable for any part of any
such item, (y) any such item is secured by a Lien on such Person's property or
(z) any other Person has a right, contingent or otherwise, to cause such Person
to become liable for any part of any such item or to grant such a Lien. Any
amount of any Indebtedness for which recourse is expressly limited to a specific
asset shall be limited to the fair market value of such asset.
"Indemnified Matters" has the meaning specified in Section 11.4.
"Indemnitee" has the meaning specified in Section 11.4.
"Initial Projections" means those financial projections covering the Fiscal
Years ending in 2007 through 2013 and delivered to the Administrative Agent by
Holdings prior to the date hereof.
"Intellectual Property" means all rights, title and interests in or
relating to intellectual property and industrial property arising under any
Requirement of Law and all IP Ancillary Rights relating thereto, including all
Copyrights, Patents, Trademarks, Internet Domain Names, Trade Secrets and IP
Licenses.
"Intercreditor Agreement" means the Intercreditor Agreement dated as of the
Closing Date, substantially in the form of Exhibit I, among the Administrative
Agent, the First Lien Administrative Agent, Holdings, the Borrower and the other
Loan Parties.
"Interest Period" means, with respect to any Eurodollar Rate Loan, the
period commencing on the date such Eurodollar Rate Loan is made or converted to
a Eurodollar Rate Loan or, if such loan is continued, on the last day of the
immediately preceding Interest Period therefor and, in each case, ending 1, 2, 3
or 6 months thereafter, as selected by the Borrower pursuant hereto; provided,
however, that (a) if any Interest Period would otherwise end on a day that is
not a Business Day, such Interest Period shall be extended to the next
succeeding Business Day, unless the result of such extension would be to extend
such Interest Period into another such Business Day falls in the next calendar
month, in which case such Interest Period shall end on the immediately preceding
Business Day, (b) any Interest Period that begins on the last Business Day of a
calendar month (or on a day for which there is no numerically corresponding day
in the calendar month at the end of such Interest Period) shall end on the last
Business Day of a calendar
16
month, (c) the Borrower may not select any Interest Period ending after the
Scheduled Term Loan Maturity Date, (d) the Borrower may not select any Interest
Period in respect of Loans having an aggregate principal amount of less than
$1,000,000 and (e) there shall be outstanding at any one time no more than 5
Interest Periods.
"Interest Rate Contracts" means all interest rate swap agreements, interest
rate cap agreements, interest rate collar agreements and interest rate
insurance.
"Internet Domain Names" means all right, title and interest (and all
related IP Ancillary Rights) relating to Internet domain names.
"Investment" means, with respect to any Person, directly or indirectly, (a)
to own, purchase or otherwise acquire, in each case whether beneficially or
otherwise, any investment in, including any interest in, any Security of any
other Person (other than any evidence of any Obligation), (b) to purchase or
otherwise acquire, whether in one transaction or in a series of transactions,
all or a significant part of the property of any other Person or a business
conducted by any other Person or all or substantially all of the assets
constituting the business of a division, branch, brand or other unit operation
of any other Person, (c) to incur, or to remain liable under, any Guaranty
Obligation for Indebtedness of any other Person, to assume the Indebtedness of
any other Person or to make, hold, purchase or otherwise acquire, in each case
directly or indirectly, any deposit, loan, advance, commitment to lend or
advance, or other extension of credit (including by deferring or extending the
date of, in each case outside the ordinary course of business, the payment of
the purchase price for Sales of property or services to any other Person, to the
extent such payment obligation constitutes Indebtedness of such other Person),
excluding deposits with financial institutions available for withdrawal on
demand, prepaid expenses, accounts receivable and similar items created in the
ordinary course of business, (d) to make, directly or indirectly, any
contribution to the capital of any other Person or (e) to Sell any property for
less than fair market value (including a disposition of cash or Cash Equivalents
in exchange for consideration of lesser value); provided, however, that such
Investment shall be valued at the difference between the value of the
consideration for such Sale and the fair market value of the property Sold.
"IP Ancillary Rights" means, with respect to any Intellectual Property, as
applicable, all foreign counterparts to, and all divisionals, reversions,
continuations, continuations-in-part, reissues, reexaminations, renewals and
extensions of, such Intellectual Property and all income, royalties, proceeds
and Liabilities at any time due or payable or asserted under or with respect to
any of the foregoing or otherwise with respect to such Intellectual Property,
including all rights to xxx or recover at law or in equity for any past, present
or future infringement, misappropriation, dilution, violation or other
impairment thereof, and, in each case, all rights to obtain any other IP
Ancillary Right.
"IP License" means all Contractual Obligations (and all related IP
Ancillary Rights), whether written or oral, granting any right, title and
interest in or relating to any Intellectual Property.
"IRS" means the Internal Revenue Service of the United States and any
successor thereto.
"Lenders" means, collectively, any financial institution or other Person
that (a) is listed on the signature pages hereof as a "Lender" or (b) from time
to time becomes a party hereto by execution of an Assignment, in each case
together with its successors.
17
"Liabilities" means all claims, actions, suits, judgments, damages, losses,
liability, obligations, fines, penalties, sanctions, costs, fees, taxes,
commissions, charges, disbursements and expenses, in each case of any kind or
nature (including interest accrued thereon or as a result thereof and fees,
charges and disbursements of financial, legal and other advisors and
consultants), whether joint or several, whether or not indirect, contingent,
consequential, actual, punitive, treble or otherwise.
"Lien" means any mortgage, deed of trust, pledge, hypothecation, assignment
for security, charge, security deposit arrangement, encumbrance, easement, lien
(statutory or other), security interest or other security arrangement and any
other preference, priority or preferential arrangement of any kind or nature
whatsoever, including any conditional sale contract or other title retention
agreement, the interest of a lessor under a Capital Lease and any synthetic or
other financing lease having substantially the same economic effect as any of
the foregoing.
"Loan" means any loan made or deemed made by any Lender hereunder.
"Loan Documents" means, collectively, this Agreement, any Notes, the
Guaranty and Security Agreement, the Intercreditor Agreement, the Mortgages, the
Control Agreements, the Fee Letter and, when executed, each document executed by
a Loan Party and delivered to the Administrative Agent or any Lender in
connection with or pursuant to any of the foregoing or the Obligations, together
with any modification of any term, or any waiver with respect to, any of the
foregoing.
"Loan Party" means the Borrower and each Guarantor.
"Material Adverse Effect" means an effect that results in or causes, or
could reasonably be expected to result in or cause, a material adverse change in
any of (a) the condition (financial or otherwise), business, performance,
prospects, operations or property of the Group Members, taken as a whole, (b)
the ability of any Loan Party to perform its obligations under any Loan Document
and (c) the validity or enforceability of any Loan Document or the rights and
remedies of the Administrative Agent, the Lenders and the other Secured Parties
under any Loan Document.
"Material Event of Default" means (i) at any time on or prior to the 90th
day following the Closing Date, any Event of Default specified in Section
9.1(e), and (ii) at any time thereafter, any Event of Default.
"Maximum Lawful Rate" has the meaning specified in Section 2.9(d).
"Merger" means, following consummation of the Tender Offer, the merger of
AcquisitionCo with and into Target on the terms and subject to the conditions
set forth in the Acquisition Agreement.
"Merger Funding Date" means the date on which the Effective Time (as
defined in the Acquisition Agreement) shall have occurred pursuant to the
Acquisition Agreement in compliance in all material respects with the applicable
provisions of Delaware law.
"Moody's" means Xxxxx'x Investors Service, Inc.
18
"Mortgage" means any mortgage, deed of trust or other document executed or
required herein to be executed by any Loan Party and granting a security
interest over real property in favor of the Administrative Agent as security for
the Obligations.
"Mortgage Supporting Documents" means, with respect to any Mortgage for a
parcel of owned real property, each document (including title policies or
marked-up unconditional insurance binders (in each case, together with copies of
all documents referred to therein), ALTA (or TLTA, if applicable) as-built
surveys (in form and as to date that is sufficiently acceptable to the title
insurer issuing title insurance to the Administrative Agent for such title
insurer to deliver endorsements to such title insurance as reasonably requested
by the Administrative Agent), environmental assessments and reports and evidence
regarding recording and payment of fees, insurance premium and taxes) that the
Administrative Agent may reasonably request, to create, register, perfect,
maintain, evidence the existence, substance, form or validity of or enforce a
valid lien on such parcel of real property in favor of the Administrative Agent
for the benefit of the Secured Parties, subject only to Permitted Liens or other
Liens as the Administrative Agent may approve (provided that such approval shall
not be unreasonably withheld if such other Lien is affirmatively insured under a
lender's title insurance policy).
"Multiemployer Plan" means any multiemployer plan, as defined in Section
400l(a)(3) of ERISA, to which any ERISA Affiliate contributes to or has
contributed to within the last six (6) years or otherwise has any obligation or
liability, contingent or otherwise.
"Net Cash Proceeds" means proceeds received in cash from (a) any Sale of,
or Property Loss Event with respect to, property, net of (i) the out-of-pocket
cash costs, fees and expenses paid or required to be paid in connection
therewith, (ii) taxes paid or reasonably estimated to be payable as a result
thereof and (iii) any amount required to be paid or prepaid on Indebtedness
(other than the Obligations and Indebtedness owing to any Group Member) secured
by the property subject thereto or (b) any incurrence of Indebtedness or (solely
for purposes of the last paragraph of Section 8.3 and Section 8.6(e)) issuance
of any Stock, in each case net of brokers', advisors' and investment banking
fees and other out-of-pocket underwriting discounts, commissions and other
out-of-pocket cash costs, fees and expenses, in each case incurred in connection
with such transaction; provided, however, that any such proceeds received by any
Subsidiary of Holdings that is not a Wholly Owned Subsidiary of Holdings shall
constitute "Net Cash Proceeds" only to the extent of the aggregate direct and
indirect beneficial ownership interest of Holdings therein.
"Non-Funding Lender" has the meaning specified in Section 2.2(c).
"Non-U.S. Lender Party" means each of the Administrative Agent, each
Lender, each SPV and each participant, in each case that is not a Domestic
Person.
"Note" means a promissory note of the Borrower, in substantially the form
of Exhibit B, payable to the order of a Lender in the aggregate initial
principal amount of the Term Loan made by such Lender.
"Notice of Borrowing" has the meaning specified in Section 2.2.
"Notice of Conversion or Continuation" has the meaning specified in Section
2.10.
19
"Obligations" means, with respect to any Loan Party, all amounts,
obligations, liabilities, covenants and duties of every type and description
owing by such Loan Party to the Administrative Agent, any Lender, any other
Indemnitee, any participant, or any SPV arising out of, under, or in connection
with, any Loan Document, whether direct or indirect (regardless of whether
acquired by assignment), absolute or contingent, due or to become due, whether
liquidated or not, now existing or hereafter arising and however acquired, and
whether or not evidenced by any instrument or for the payment of money,
including, without duplication, (a) if such Loan Party is the Borrower and all
Loans, (b) all interest, whether or not accruing after the filing of any
petition in bankruptcy or after the commencement of any insolvency,
reorganization or similar proceeding, and whether or not a claim for post-filing
or post-petition interest is allowed in any such proceeding, and (c) all other
fees, expenses (including reasonable fees, charges and disbursement of counsel),
interest, commissions, charges, Prepayment Premium, costs, disbursements,
indemnities and reimbursement of amounts paid and other sums chargeable to such
Loan Party pursuant to any Loan Document.
"Other Taxes" has the meaning specified in Section 2.17(c).
"Patriot Act" means USA PATRIOT Act (Title III of Pub. L. 107-56 (signed
into law October 26, 2001).
"Patents" means all right, title and interest (and all related IP Ancillary
Rights) arising under any Requirement of Law in or relating to patents and
applications therefor.
"Payoff Debt" means the Indebtedness described on Schedule 8.1B which shall
be paid or redeemed in full (other than contingent indemnification obligations
as to which no claim has been asserted) on the Closing Date. Payoff Debt shall
include Indebtedness under the Existing Credit Agreement and the Existing
Subordinated Notes and all other obligations (other than contingent
indemnification obligations as to which no claim has been asserted) under the
Payoff Debt Documents.
"Payoff Debt Documents" means the credit agreement, indenture or other
documents evidencing or governing the Payoff Debt.
"PBGC" means the United States Pension Benefit Guaranty Corporation and any
successor thereto.
"Pension Plan" means a Plan described in Section 3(2) of ERISA
"Permit" means, with respect to any Person, any permit, approval,
authorization, license, registration, certificate, concession, grant, franchise,
variance or permission from, and any other Contractual Obligations in the nature
of any of the foregoing with, any Governmental Authority, in each case whether
or not having the force of law, and applicable to or binding upon such Person or
any of its property or to which such Person or any of its property is subject.
"Permitted Acquisition" means any Proposed Acquisition satisfying each of
the following conditions: (a) the Administrative Agent shall have received
reasonable advance notice of such Proposed Acquisition including a reasonably
detailed description thereof at least 15 days (or, in the case of any Proposed
Acquisition having Permitted Acquisition Consideration of less than $11,500,000,
5 days, and provided that no such notice shall be required for any Proposed
Acquisition set forth on Schedule 8.3A) prior to the consummation of such
Proposed Acquisition
20
(or such later date as may be agreed by the Administrative Agent) and on or
prior to the date of such Proposed Acquisition, the Administrative Agent shall
have received copies of the acquisition agreement and related material
Contractual Obligations and other material documents and information (including
financial information and analysis, environmental assessments and reports,
opinions, certificates and lien searches) reasonably requested by the
Administrative Agent, (b) as of the date of consummation of any transaction as
part of such Proposed Acquisition and after giving effect to all transactions to
occur on such date as part of such Proposed Acquisition, no Default or Event of
Default shall be continuing, (c) after giving effect to such Proposed
Acquisition, Borrower shall be in compliance with the financial covenants set
forth in Article V (provided that the Consolidated Leverage Ratio shall be 0.25
to 1.00 less than the applicable Consolidated Leverage Ratio required under
Section 5.1) on a Pro Forma Basis as of the last day of the last Fiscal Quarter
for which Financial Statements have been delivered hereunder for the 4 Fiscal
Quarter period ending on such day (as if such Permitted Acquisition had occurred
on the first day of such period), (d) both before and immediately after giving
effect to such Proposed Acquisition, the Loan Parties shall have unused First
Lien Revolving Credit Commitments and available cash and Cash Equivalents on
deposit to a Cash Collateral Account (other than the Acquisition Cash Collateral
Account) or a Controlled Deposit Account of at least $42,500,000 in the
aggregate, and (e) at or prior to the closing of such Proposed Acquisition, the
Borrower shall deliver to the Administrative Agent a certificate of the Chief
Financial Officer, Treasurer or Vice President, Finance of Holdings to the
effect that the conditions in clauses (b), (c) and (d) above have been satisfied
and setting forth the calculation thereof, which certificate shall be a form
reasonably satisfactory to the Administrative Agent. "Permitted Acquisition"
also includes (i) any proposed merger or acquisition consented to by the
Required Lenders, and (ii) the Cholestech Acquisition.
"Permitted Acquisition Consideration" means aggregate amounts payable in
connection with, and other consideration for, any Permitted Acquisition (other
than the Acquisition and the Cholestech Acquisition), in each case, including
as, if and when earned, any "earnout" and similar payment obligations, all
transaction costs and all Indebtedness, liabilities and Guaranty Obligations
incurred or assumed in connection therewith or otherwise reflected in a
Consolidated balance sheet of Holdings and the Proposed Acquisition Target.
"Permitted Acquisition Debt" means Indebtedness which satisfies each of the
following conditions: (a) the Indebtedness is unsecured and is incurred in order
to consummate a Permitted Acquisition and/or assumed in connection with any
Permitted Acquisition (but not incurred in connection with or contemplation of
such Permitted Acquisition), (b) the Administrative Agent shall have received
reasonable advance notice of the incurrence and/or assumption of such
Indebtedness including a reasonably detailed description thereof at least 15
days (or, in the case of Permitted Acquisition Debt being incurred to finance
any Proposed Acquisition having Permitted Acquisition Consideration of less than
$11,500,000, 5 days) prior to such incurrence and/or assumption (or such later
date as may be agreed by the Administrative Agent) and on or prior to the date
of such incurrence and/or assumption, the Administrative Agent shall have
received copies of the credit agreement, indenture and related Contractual
Obligations and other documents and information reasonably requested by the
Administrative Agent, (c) as of the date of incurrence and/or assumption of such
Indebtedness and after giving effect to all transactions to occur on such date
(including such Permitted Acquisition), no Default or Event of Default shall be
continuing, (d) after giving effect to the incurrence and/or assumption of such
Indebtedness and such Permitted Acquisition, Borrower shall be in compliance
with the financial covenants set forth in Article V (provided that the
Consolidated Leverage Ratio shall be 0.25 to 1.00 less than
21
the applicable Consolidated Leverage Ratio required under Section 5.1), on a Pro
Forma Basis as of the last day of the last Fiscal Quarter for which Financial
Statements have been delivered hereunder for the 4 Fiscal Quarter period ending
on such day (as if such Indebtedness had been incurred or assumed and such
Permitted Acquisition had occurred on the first day of such period), and (e) at
or prior to the incurrence and/or assumption of such Indebtedness and closing of
such Permitted Acquisition, the Borrower shall deliver to the Administrative
Agent a certificate of the Chief Financial Officer, Treasurer or Vice President,
Finance of Holdings to the effect that the conditions in clauses (c) and (d)
above have been satisfied and setting forth the calculation thereof, which
certificate shall be a form reasonably satisfactory to the Administrative Agent.
"Permitted Indebtedness" means any Indebtedness of any Group Member that is
not prohibited by Section 8.1.
"Permitted Investment" means any Investment of any Group Member that is not
prohibited by Section 8.3.
"Permitted Lien" means any Lien on or with respect to the property of any
Group Member that is not prohibited by Section 8.2.
"Permitted Refinancing" means Indebtedness constituting a refinancing,
extension of maturity or other modifications of the terms of Permitted
Indebtedness that (a) has an aggregate outstanding principal amount not greater
than the aggregate principal amount of such Permitted Indebtedness (plus accrued
interest on the Indebtedness being refinanced) outstanding at the time of such
refinancing or extension, (b) has a weighted average maturity (measured as of
the date of such refinancing or extension) no shorter than that of such
Permitted Indebtedness, (c) is not entered into as part of a Sale and Leaseback
Transaction, (d) is not secured by any property or any Lien other than those
securing such Permitted Indebtedness, provided such Lien shall have the same
priority as the Lien securing such Permitted Indebtedness (and with respect to
any Permitted Refinancing of the First Lien Obligations is subject to the
Intercreditor Agreement), (e) is subordinated to the Obligations on terms no
less favorable (in the reasonable judgment of the Administrative Agent) to the
holders of the Obligations as the Indebtedness being refinanced or extended and
(f) is otherwise on terms no less favorable in any material respect to the Group
Members, taken as a whole, than those of such Permitted Indebtedness; provided,
however, that, notwithstanding the foregoing, (x) the terms of such Permitted
Indebtedness may be modified as part of such Permitted Refinancing if such
modification would have been permitted pursuant to Section 8.11, (y) the
interest rate, any premium or fees or any similar payment obligation under such
Permitted Indebtedness may be increased consistent with then prevailing market
conditions, and (z) no Guaranty Obligation for such Indebtedness shall
constitute part of such Permitted Refinancing unless similar Guaranty
Obligations with respect to such Permitted Indebtedness existed and constituted
Permitted Indebtedness prior to such refinancing or extension.
"Permitted Reinvestment" means, with respect to the Net Cash Proceeds of
any Sale or Property Loss Event, to acquire (or make Capital Expenditures to
finance the acquisition, repair, improvement or construction of), to the extent
otherwise permitted hereunder, property useful in the business of the Borrower
or any of its Subsidiaries (including through a Permitted Acquisition) or, if
such Property Loss Event involves loss or damage to property, to repair such
loss or damage.
"Permitted Subordinated Debt" means Subordinated Debt which satisfies each
of the following conditions: (a) the Administrative Agent shall have received
reasonable advance
22
notice of the incurrence and/or assumption of such Indebtedness including a
reasonably detailed description thereof at least 15 days prior to such
incurrence and/or assumption (or such later date as may be agreed by the
Administrative Agent) and on or prior to the date of such incurrence and/or
assumption, the Administrative Agent shall have received copies of the credit
agreement, indenture and related Contractual Obligations and other documents and
information reasonably requested by the Administrative Agent, (b) such
Subordinated Debt shall be unsecured and shall have no scheduled principal
payments, prepayments or redemptions prior to the date which is 6 months after
the Scheduled Term Loan Maturity Date and is otherwise on terms satisfactory to
the Administrative Agent, (c) as of the date of incurrence and/or assumption of
such Subordinated Debt and after giving effect to all transactions to occur on
such date no Default or Event of Default is continuing, (d) Holdings shall be in
compliance with the financial covenants set forth in Article V (provided that
the Consolidated Leverage Ratio shall be 0.50 to 1.00 less than the applicable
Consolidated Leverage Ratio required under Section 5.1), on a Pro Forma Basis as
of the last day of the last Fiscal Quarter for which Financial Statements have
been delivered hereunder for the 4 Fiscal Quarter period ending on such day (as
if such Subordinated Debt had been incurred on the first day of such period),
and (e) at or prior to the incurrence and/or assumption of such Subordinated
Debt, Holdings shall deliver to the Administrative Agent a certificate of its
Chief Financial Officer, Treasurer or Vice President, Finance to the effect that
the conditions in clause (d) above have been satisfied and setting forth the
calculation thereof, which certificate shall be a form reasonably satisfactory
to the Administrative Agent.
"Person" means any individual, partnership, corporation (including a
business trust and a public benefit corporation), joint stock company, estate,
association, firm, enterprise, trust, limited liability company, unincorporated
association, joint venture and any other entity or Governmental Authority.
"P&G Call Option" means the ability of a member of the P&G JV Companies to
require a breaching member (or any of its affiliates) to sell its units or
shares in the P&G JV Companies (less damages arising from the material breach)
to the non-breaching member (or any of its affiliates) pursuant to the P&G JV
Agreements.
"P&G Holdings Guaranty" means that certain guaranty dated May 17, 2007 made
by Holdings in respect of the P&G Joint Venture.
"P&G Joint Venture" means the joint venture between Holdings and The
Xxxxxxx & Xxxxxx Company conducted through the P&G JV Companies pursuant to the
P&G JV Agreements for the purpose of developing, acquiring and marketing
consumer diagnostic and monitoring products (excluding products in the
cardiology, diabetes and oral care fields).
"P&G JV Agreements" means the agreements set forth on Schedule 4.3(b)
hereto.
"P&G JV Capital Call Obligations" means any capital call obligation of the
P&G JV Companies under the P&G JV Agreements, or any guaranty thereof by
Holdings pursuant to the P&G Holdings Guaranty.
"P&G JV Companies" means US CD LLC, a Delaware limited liability company,
and SPD Swiss Precision Diagnostics GmbH, a company organized under the laws of
Switzerland and any subsidiaries of either of them.
"P&G Put Date" means the date the P&G Put Option is exercised.
23
"P&G Put Option" means the exercise of Procter & Xxxxxx International
Operations, SA's ("PGIO") or Procter & Xxxxxx RHD, Inc.'s ("PGUS") right to
require Holdings or Swissco (or any other Subsidiary of Holdings) to purchase
PGIO and PGUS's units and shares (or any other equity interests) in the P&G JV
Companies pursuant to the P&G JV Agreements.
"Prepayment Premium" means at any time with respect to any Term Loans being
prepaid in whole or in part pursuant to Section 2.7 or 2.8(b) during any of the
periods set forth below an amount equal to the percentage set forth opposite
such period of the aggregate principal amount of the Term Loans being prepaid at
such time:
Percentage of Principal
Period Amount Being Prepaid
------ -----------------------
June 26, 2007 to and
Including June 26, 2008 2.0%
June 27, 2008 to and
Including June 26, 2009 1.0%
At all times after June 27, 2009 0.0%
"Pro Forma Basis" means, with respect to any determination for any period
and any Pro Forma Transaction, that such determination shall be made by giving
pro forma effect to each such Pro Forma Transaction (including any Pro Forma
Cost Savings directly attributable to such Pro Forma Transaction), as if each
such Pro Forma Transaction had been consummated on the first day of such period,
based on historical results accounted for in accordance with GAAP and, to the
extent applicable, reasonable assumptions that are specified in detail in the
relevant Compliance Certificate, Financial Statement or other document provided
to the Administrative Agent or any Lender in connection herewith in accordance
with Regulation S-X (except for any Pro Forma Cost Savings which need not be in
accordance with Regulation S-X).
"Pro Forma Cost Savings" means, with respect to any period, operating
expense reductions that are reasonably expected to be sustainable over such
period, will not adversely affect revenues and are not greater than the
reduction reasonably expected to be realized, regardless of whether these cost
savings could then be reflected in pro forma financial statements in accordance
with Regulation S-X, all such operating expense reductions to be reasonably
determined in good faith by the chief financial or accounting officer of
Holdings and to be reasonably satisfactory to the Administrative Agent and, to
the extent requested by the Administrative Agent, to be set forth in a
certificate signed by such officer.
"Pro Forma Financial Statements" has the meaning specified in Section
4.4(d).
"Pro Forma Transaction" means any transaction consummated as part of any
Permitted Acquisition, together with each other transaction relating thereto and
consummated in connection therewith, including any incurrence or repayment of
Indebtedness.
"Projections" means, collectively, the Initial Projections and any document
delivered pursuant to Section 6.1(e).
"Property Loss Event" means, with respect to any property, any loss of or
damage to such property or any taking of such property or condemnation thereof.
24
"Proposed Acquisition" means (a) any proposed acquisition that is
consensual and approved by the board of directors (or other applicable governing
body) of the applicable Proposed Acquisition Target, of all or substantially all
of the Stock of such Proposed Acquisition Target by Holdings or any Subsidiary
of Holdings or all or substantially all of the assets of any Proposed
Acquisition Target by any Subsidiary of Holdings or (b) any proposed merger of
any Proposed Acquisition Target with or into any Subsidiary of Holdings (and, in
the case of a merger with the Borrower, with the Borrower being the surviving
corporation).
"Proposed Acquisition Target" means any Person (including any Subsidiary
thereof) or any brand, line of business, division, branch, operating division or
other unit operation of any Person.
"Pro Rata Outstandings", of any Lender at any time, means the outstanding
principal amount of the Term Loans owing to such Lender.
"Pro Rata Share" means, with respect to any Lender at any time, the
percentage obtained by dividing (a) the sum of the Term Loan Commitments (or, if
such Term Loan Commitments in the Term Loan Facility are terminated, the Pro
Rata Outstandings therein) of such Lender then in effect under the Term Loan
Facility by (b) the sum of the Term Loan Commitments (or, if such Term Loan
Commitments in the Term Loan Facility are terminated, the Pro Rata Outstandings
therein) of all Lenders then in effect under the Term Loan Facility; provided,
however, that, if there are no Term Loan Commitments and no Pro Rata
Outstandings in any of the Term Loan Facility, such Lender's Pro Rata Share in
the Term Loan Facility shall be determined based on the Pro Rata Share in the
Term Loan Facility most recently in effect, after giving effect to any
subsequent assignment and any subsequent non-pro rata payments of any Lender
pursuant to Section 2.18.
"Register" has the meaning specified in Section 2.14(b).
"Regulation S-X" means Regulation S-X of the Securities Act of 1933.
"Reinvestment Prepayment Amount" means, with respect to any Net Cash
Proceeds on the Reinvestment Prepayment Date therefor, the amount of such Net
Cash Proceeds less any amount paid or required to be paid by any Group Member to
make Permitted Reinvestments with such Net Cash Proceeds pursuant to a
Contractual Obligation entered into prior to such Reinvestment Prepayment Date
with any Person that is not an Affiliate of the Borrower.
"Reinvestment Prepayment Date" means, with respect to any portion of any
Net Cash Proceeds of any Sale or Property Loss Event, the earliest of (a) the
180th day after the completion of the portion of such Sale or Property Loss
Event corresponding to such Net Cash Proceeds, (b) the date that is five (5)
Business Days after the date on which the Borrower shall have notified the
Administrative Agent of the Borrower's determination not to make Permitted
Reinvestments with such Net Cash Proceeds, and (c) five (5) Business Days after
the delivery of a notice by the Administrative Agent or the Required Lenders to
the Borrower during the continuance of any Event of Default.
"Related Documents" means, collectively, the Acquisition Agreement, the
First Lien Loan Documents, the documents relating to the repayment, redemption
or other satisfaction of the Payoff Debt delivered pursuant to Section 3.1(g),
and each other document executed with respect to any of the foregoing or any
Related Transaction.
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"Related Person" means, with respect to any Person, each Affiliate of such
Person and each director, officer, employee, stockholder or other equity holder,
financing source or agent, trustee, representative, attorney, accountant and
each insurance, environmental, legal, financial and other advisor (including
those retained in connection with the satisfaction or attempted satisfaction of
any condition set forth in Article III) and other consultants and agents of or
to such Person or any of its Affiliates, together with, if such Person is the
Administrative Agent, each other Person or individual designated, nominated or
otherwise mandated by or helping the Administrative Agent pursuant to and in
accordance with Section 10.4 or any comparable provision of any Loan Document.
"Related Transactions" means, collectively, the consummation of the
Acquisition (including the Tender Offer and the Merger), the entering into of
the First Lien Loan Documents and the borrowing of the loans and other
extensions of credit thereunder, the prepayment, redemption, refinancing or
other satisfaction of the Payoff Debt, the execution and delivery of all Related
Documents and the payment of all related fees, costs and expenses.
"Release" means any release, threatened release, spill, emission, leaking,
pumping, pouring, emitting, emptying, escape, injection, deposit, disposal,
discharge, dispersal, dumping, leaching or migration of Hazardous Material into
or through the environment.
"Remedial Action" means all actions required to (a) clean up, remove, treat
or in any other way address any Hazardous Material in the indoor or outdoor
environment, (b) prevent or minimize any Release so that a Hazardous Material
does not migrate or endanger or threaten to endanger public health or welfare or
the indoor or outdoor environment or (c) perform pre-remedial studies and
investigations and post-remedial monitoring and care with respect to any
Hazardous Material.
"Required Lenders" means, at any time, Lenders having at such time in
excess of 50% of the Term Loan Commitments (or, if such Term Loan Commitments
are terminated, the Pro Rata Outstandings in the Term Loan Facility) then in
effect, ignoring, in such calculation, the amounts held by any Non-Funding
Lender.
"Requirements of Law" means, with respect to any Person, collectively, the
common law and all federal, state, local, foreign, multinational or
international laws, statutes, codes, treaties, standards, rules and regulations,
guidelines, ordinances, orders, judgments, writs, injunctions, decrees
(including administrative or judicial precedents or authorities) and the
interpretation or administration thereof by, and other determinations,
directives, requirements or requests of, any Governmental Authority, in each
case whether or not having the force of law and that are applicable to or
binding upon such Person or any of its property or to which such Person or any
of its property is subject, including all Healthcare Laws.
"Responsible Officer" means, with respect to any Person, any of the
president, chief executive officer, chief financial officer, treasurer,
assistant treasurer, controller, managing member or general partner of such
Person but, in any event, with respect to financial matters, any such officer
that is responsible for preparing the Financial Statements delivered hereunder
and, with respect to the Corporate Chart delivered pursuant to Section 6.1(d),
documents delivered on the Closing Date and documents delivered pursuant to
Section 7.10, the secretary or assistant secretary of such Person or any other
officer responsible for maintaining the corporate and similar records of such
Person. Any certificate or other document required to be delivered hereunder by
26
any Responsible Officer or other officer of any Group Member shall be delivered
on behalf of the applicable Group Member and not in such person's individual
capacity.
"Restricted Payment" means (a) any dividend, return of capital,
distribution or any other payment or Sale of property for less than fair market
value, whether direct or indirect (including through the use of Hedging
Agreements, the making, repayment, cancellation or forgiveness of Indebtedness
and similar Contractual Obligations) and whether in cash, Securities or other
property, in each case on account of any Stock or Stock Equivalent of any Group
Member, in each case now or hereafter outstanding, including with respect to a
claim for rescission of a Sale of such Stock or Stock Equivalent, and (b) any
redemption, retirement, termination, defeasance, cancellation, purchase or other
acquisition for value, whether direct or indirect (including through the use of
Hedging Agreements, the making, repayment, cancellation or forgiveness of
Indebtedness and similar Contractual Obligations), of any Stock or Stock
Equivalent of any Group Member, now or hereafter outstanding, and any payment or
other transfer setting aside funds for any such redemption, retirement,
termination, cancellation, purchase or other acquisition, whether directly or
indirectly and whether to a sinking fund, a similar fund or otherwise.
"S&P" means Standard & Poor's Rating Services.
"Sale and Leaseback Transaction" means, with respect to any Person (the
"obligor"), any Contractual Obligation or other arrangement with any other
Person (the "counterparty") consisting of a lease by such obligor of any
property that, directly or indirectly, has been or is to be Sold by the obligor
to such counterparty or to any other Person to whom funds have been advanced by
such counterparty based on a Lien on, or an assignment of, such property or any
obligations of such obligor under such lease.
"Scheduled Term Loan Maturity Date" means the eighth (8th) anniversary of
the Closing Date.
"SEC" means The United States Securities and Exchange Commission.
"Secured Parties" means the Lenders and the Administrative Agent, each
other Indemnitee and any other holder of any Obligation of any Loan Party.
"Security" means all Stock, Stock Equivalents, voting trust certificates,
bonds, debentures, instruments and other evidence of Indebtedness, whether or
not secured, convertible or subordinated, all certificates of interest, share or
participation in, all certificates for the acquisition of, and all warrants,
options and other rights to acquire, any Security.
"Sell" means, with respect to any property, to sell, convey, transfer,
assign, license, lease or otherwise dispose of, any interest therein or to
permit any Person to acquire any such interest, including, in each case, through
a Sale and Leaseback Transaction or through a sale, factoring at maturity,
collection of or other disposal, with or without recourse, of any notes or
accounts receivable. Conjugated forms thereof and the noun "Sale" have
correlative meanings.
"Solvent" means, with respect to any Person or any group of Persons taken
together on a consolidated basis as of any date of determination, that, as of
such date, (a) the value of the assets of such Person or group (both at fair
value and present fair saleable value) is greater than the total amount of
liabilities (including contingent and unliquidated liabilities) of such Person
or group,
27
(b) such Person or group is able to pay all liabilities of such Person or group
as such liabilities mature and (c) such Person or group does not have
unreasonably small capital. In computing the amount of contingent or
unliquidated liabilities at any time, such liabilities shall be computed at the
amount that, in light of all the facts and circumstances existing at such time,
represents the amount that can reasonably be expected to become an actual or
matured liability.
"SPV" means any special purpose funding vehicle identified as such in a
writing by any Lender to the Administrative Agent.
"Stock" means all shares of capital stock (whether denominated as common
stock or preferred stock), equity interests, beneficial, partnership or
membership interests, joint venture interests, participations or other ownership
or profit interests in or equivalents (regardless of how designated) of or in a
Person (other than an individual), whether voting or non-voting.
"Stock Equivalents" means all securities convertible into or exchangeable
for Stock or any other Stock Equivalent and all warrants, options or other
rights to purchase, subscribe for or otherwise acquire any Stock or any other
Stock Equivalent, whether or not presently convertible, exchangeable or
exercisable.
"Subordinated Convertible Notes" means 3.0% senior subordinated convertible
notes of Holdings due 2016 in an original aggregate principal amount of
$150,000,000, issued pursuant to the Subordinated Convertible Notes Indenture.
"Subordinated Convertible Notes Documents" means, collectively, the
Subordinated Convertible Notes, the Subordinated Convertible Notes Indenture and
any other document related to any of the foregoing.
"Subordinated Convertible Notes Indenture" means the Indenture, dated as of
May 14, 2007, between Holdings and U.S. Bank Trust National Association, as
trustee.
"Subordinated Debt" means any Indebtedness that is subordinated to the
payment in full of the Obligations on terms and conditions satisfactory to the
Administrative Agent. "Subordinated Debt" includes the Subordinated Convertible
Notes and any Permitted Subordinated Debt.
"Subsequent Tender Funding Date" means any date after the Closing Date on
which AcquisitionCo is obligated to make payment for any Target Shares then
subject to purchase by AcquisitionCo pursuant to the Tender Offer in accordance
with the terms of the Acquisition Agreement and the Tender Offer.
"Subsidiary" means, with respect to any Person, any corporation,
partnership, joint venture, limited liability company, association or other
entity, the management of which is, directly or indirectly, controlled by, or of
which an aggregate of more than 50% of the outstanding Voting Stock is, at the
time, owned or controlled directly or indirectly by, such Person or one or more
Subsidiaries of such Person. Based on the capital structure and ownership of the
P&G JV Companies as of the Closing Date, the P&G JV Companies are not
Subsidiaries of any Group Member.
"Substitute Lender" has the meaning specified in Section 2.18(a).
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"SWDA" means the Solid Waste Disposal Act (42 U.S.C. Sections 6901 et
seq.).
"Swissco" means Inverness Medical Switzerland GmbH, an entity organized
under the laws of Switzerland.
"Target" means Biosite Incorporated, a Delaware corporation.
"Target Margin Stock" means any Target Shares or any other shares of
capital stock of the Target, in each case, that are margin stock (within the
meaning of Regulation U of the Federal Reserve Board).
"Target Shares" means shares of common stock, $0.001 par value per share,
of the Target.
"Tax Affiliate" means, (a) the Borrower and its Subsidiaries and (b) any
Affiliate of the Borrower with which the Borrower files or is eligible to file
consolidated, combined or unitary tax returns.
"Tax Return" has the meaning specified in Section 4.8.
"Taxes" has the meaning specified in Section 2.17(a).
"Tender Offer" means the tender offer by AcquisitionCo to purchase all
outstanding Target Shares, at a price of $92.50 per share, in cash on the terms
and subject to the conditions set forth in the Acquisition Agreement pursuant to
a Tender Offer Statement on Schedule TO containing AcquisitionCo's offer to
purchase and related letter of transmittal and the related form of summary
advertisement, as filed with the United States Securities and Exchange
Commission on May 29, 2007, as amended from time to time.
"Term Loan" has the meaning specified in Section 2.1(b).
"Term Loan Commitment" means, with respect to each Term Loan Lender, the
commitment of such Lender to make Term Loans to the Borrower, which commitment
is in the amount set forth opposite such Lender's name on Schedule I under the
caption "Term Loan Commitment", as amended to reflect Assignments. The aggregate
amount of the Term Loan Commitments on the date hereof equals $250,000,000.
"Term Loan Facility" means the Term Loan Commitments and the provisions
herein related to the Term Loans.
"Term Loan Lender" means each Lender that has a Term Loan Commitment or
that holds a Term Loan.
"Title IV Plan" means a Pension Plan subject to Title IV of ERISA, other
than a Multiemployer Plan, to which any ERISA Affiliate maintains, sponsors or
contributes to or has maintained, sponsored or contributed to within the last
six (6) years or otherwise has any obligation or liability, contingent or
otherwise.
"Total Assets" means the total assets of Holdings and its Subsidiaries on a
consolidated basis, as shown on the most recent balance sheet of Holdings
delivered pursuant to Section 6.1(a)
29
or (b) or, for the period prior to the time any such statements are so delivered
pursuant to Section 6.1(a) or (b), the Pro Forma Financial Statements.
"Trademarks" means all right, title and interest (and all related IP
Ancillary Rights) arising under any Requirement of Law in or relating to
trademarks, trade names, corporate names, company names, business names,
fictitious business names, trade styles, service marks, logos and other source
or business identifiers and, in each case, all goodwill associated therewith,
all registrations thereof and all applications therefor.
"Trade Secrets" means all right, title and interest (and all related IP
Ancillary Rights) arising under any Requirement of Law in or relating to trade
secrets.
"UCC" means the Uniform Commercial Code of any applicable jurisdiction and,
if the applicable jurisdiction shall not have any Uniform Commercial Code, the
Uniform Commercial Code as in effect in the State of New York.
"Unfunded Pension Liability" means, at any time, the aggregate amount, if
any, of the sum of (a) the amount by which the present value of all accrued
benefits under each Title IV Plan exceeds the fair market value of all assets of
such Title IV Plan allocable to such benefits in accordance with Title IV of
ERISA, all determined as of the most recent valuation date for each such Title
IV Plan using the actuarial assumptions for funding purposes in effect under
such Title IV Plan, and (b) for a period of five (5) years following a
transaction which might reasonably be expected to be covered by Section 4069 of
ERISA, the liabilities (whether or not accrued, but only to the extent such
liabilities could reasonably be expected to have a Material Adverse Effect) that
could be avoided by any Group Member or any ERISA Affiliate as a result of such
transaction.
"United States" means the United States of America.
"U.S. Lender Party" means each of the Administrative Agent, each Lender,
each SPV and each participant, in each case that is a Domestic Person.
"Voting Stock" means Stock of any Person having ordinary power to vote in
the election of members of the board of directors, managers, trustees or other
controlling Persons of such Person (irrespective of whether, at the time, Stock
of any other class or classes of such entity shall have or might have voting
power by reason of the occurrence of any contingency).
"Wholly Owned Subsidiary" of any Person means any Subsidiary of such
Person, all of the Stock of which (other than nominal holdings and director's
qualifying shares) is owned by such Person, either directly or through one or
more Wholly Owned Subsidiaries of such Person.
"Working Capital" means, for any Person at any date, its Consolidated
Current Assets at such date minus its Consolidated Current Liabilities at such
date.
Section 1.2 UCC Terms. The following terms have the meanings given to
them in the applicable UCC: "commodity account", "commodity contract",
"commodity intermediary", "deposit account", "entitlement holder", "entitlement
order", "equipment", "financial asset", "general intangible", "goods",
"instruments", "inventory", "securities account", "securities intermediary" and
"security entitlement".
30
Section 1.3 Accounting Terms and Principles. (a) GAAP. All accounting
determinations required to be made pursuant hereto shall, unless expressly
otherwise provided herein, be made in accordance with GAAP. No change in the
accounting principles used in the preparation of any Financial Statement
hereafter adopted by Holdings shall be given effect if such change would affect
a calculation that measures compliance with any provision of Article V or VIII
unless the Borrower, the Administrative Agent and the Required Lenders agree to
modify such provisions to reflect such changes in GAAP and, unless such
provisions are modified, all Financial Statements, Compliance Certificates and
similar documents provided hereunder shall be provided together with a
reconciliation between the calculations and amounts set forth therein before and
after giving effect to such change in GAAP.
(b) Pro Forma. All components of financial calculations made to
determine compliance with Article V shall be adjusted on a Pro Forma Basis to
include or exclude, as the case may be, without duplication, such components of
such calculations attributable to any Pro Forma Transaction consummated after
the first day of the applicable period of determination and prior to the end of
such period, as determined in good faith by the Borrower based on assumptions
expressed therein and that were reasonable based on the information available to
the Borrower at the time of preparation of the Compliance Certificate setting
forth such calculations; provided that, with respect to the Acquisition and the
Cholestech Acquisition, any Pro Forma Basis adjustments shall be limited to the
applicable adjustments and amounts set forth in the definition of Consolidated
EBITDA for the periods provided therein and shall otherwise be reasonably
satisfactory to the Administrative Agent.
Section 1.4 Payments. The Administrative Agent may set up standards
and procedures to determine or redetermine the equivalent in Dollars of any
amount expressed in any currency other than Dollars and otherwise may, but shall
not be obligated to, rely on any determination made by any Loan Party. Any such
determination or redetermination by the Administrative Agent shall be conclusive
and binding for all purposes, absent manifest error. No determination or
redetermination by any Secured Party or Loan Party and no other currency
conversion shall change or release any obligation of any Loan Party or of any
Secured Party (other than the Administrative Agent and its Related Persons)
under any Loan Document, each of which agrees to pay separately for any
shortfall remaining after any conversion and payment of the amount as converted.
The Administrative Agent may round up or down, and may set up appropriate
mechanisms to round up or down, any amount hereunder to nearest higher or lower
amounts and may determine reasonable de minimis payment thresholds.
Section 1.5 Interpretation. (a) Certain Terms. Except as set forth in
any Loan Document, all accounting terms not specifically defined herein shall be
construed in accordance with GAAP (except for the term "property", which shall
be interpreted as broadly as possible, including, in any case, cash, Securities,
other assets, rights under Contractual Obligations and Permits and any right or
interest in any property). The terms "herein", "hereof" and similar terms refer
to this Agreement as a whole. In the computation of periods of time from a
specified date to a later specified date in any Loan Document, the terms "from"
means "from and including" and the words "to" and "until" each mean "to but
excluding" and the word "through" means "to and including." In any other case,
the term "including" when used in any Loan Document means "including without
limitation." The term "documents" means all writings, however evidenced and
whether in physical or electronic form, including all documents, instruments,
agreements, notices, demands, certificates, forms, financial statements,
opinions and reports. The term "incur" means incur, create, make, issue, assume
or otherwise become directly
31
or indirectly liable in respect of or responsible for, in each case whether
directly or indirectly, and the terms "incurrence" and "incurred" and similar
derivatives shall have correlative meanings.
(b) Certain References. Unless otherwise expressly indicated,
references (i) in this Agreement to an Exhibit, Schedule, Article, Section or
clause refer to the appropriate Exhibit or Schedule to, or Article, Section or
clause in, this Agreement and (ii) in any Loan Document, to (A) any agreement
shall include, without limitation, all exhibits, schedules, appendixes and
annexes to such agreement and, unless any prior consent of any Secured Party or
the Loan Parties expressly required hereunder is not obtained, any modification,
amendment, restatement or amendment and restatement to any term of such
agreement, (B) any statute shall be to such statute as modified from time to
time and to any successor legislation thereto, in each case as in effect at the
time any such reference is operative and (C) any time of day shall be a
reference to New York time. Titles of articles, sections, clauses, exhibits,
schedules and annexes contained in any Loan Document are without substantive
meaning or content of any kind whatsoever and are not a part of the agreement
between the parties hereto. Unless otherwise expressly indicated, the meaning of
any term defined (including by reference) in any Loan Document shall be equally
applicable to both the singular and plural forms of such term.
ARTICLE II
THE TERM LOAN FACILITY
Section 2.1 The Term Loan Commitment. (a) [Intentionally Omitted].
(b) Term Loan Commitment. On the terms and subject to the conditions
contained in this Agreement, each Term Loan Lender severally, but not jointly,
agrees to make a loan (each a "Term Loan") in Dollars to the Borrower on the
Closing Date in an amount not to exceed such Lender's Term Loan Commitment.
Amounts of Term Loans repaid may not be reborrowed.
Section 2.2 Borrowing Procedures. (a) Notice From the Borrower. Each
Borrowing shall be made on notice given by the Borrower to the Administrative
Agent not later than 11:00 a.m. on (i) the first Business Day, in the case of a
Borrowing of Base Rate Loans and (ii) the third Business Day, in the case of a
Borrowing of Eurodollar Rate Loans, prior to the date of the proposed Borrowing;
provided, however, that the Borrower may not request a Eurodollar Rate Loan
until the earlier of (x) the date that is thirty days after the Merger Funding
Date and (y) the date of completion of the "Primary Syndication" referred to in
the Fee Letter. Each such notice may be made in a writing substantially in the
form of Exhibit C (a "Notice of Borrowing") duly completed or by telephone if
confirmed promptly, but in any event within one Business Day and prior to such
Borrowing, with such a Notice of Borrowing. Loans shall be made as Base Rate
Loans unless, outside of a suspension period pursuant to Section 2.15, the
Notice of Borrowing specifies that all or a portion thereof shall be Eurodollar
Rate Loans. Each Borrowing shall be in an aggregate amount that is an integral
multiple of $1,000,000.
(b) Notice to Each Lender. The Administrative Agent shall give to each
Lender prompt notice of the Administrative Agent's receipt of a Notice of
Borrowing and, if Eurodollar Rate Loans are properly requested in such Notice of
Borrowing, prompt notice of the applicable interest rate. Each Lender shall,
before 11:00 a.m. on the date of the proposed Borrowing, make available to the
Administrative Agent at its address referred to in Section 11.11, such Lender's
Pro Rata Share of such proposed Borrowing. Upon fulfillment or due waiver (i) on
the Closing Date, of the applicable conditions set forth in Section 3.1 and (ii)
on the Closing Date
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and any time thereafter, of the applicable conditions set forth in Section 3.2,
the Administrative Agent shall make such funds available to the Borrower.
(c) Non-Funding Lenders. Unless the Administrative Agent shall have
received notice from any Lender prior to the date such Lender is required to
make any payment hereunder with respect to any Loan that such Lender will not
make such payment (or any portion thereof) available to the Administrative
Agent, the Administrative Agent may assume that such Lender has made such
payment available to the Administrative Agent on the date such payment is
required to be made in accordance with this Article II and the Administrative
Agent may, in reliance upon such assumption, make available to the Borrower on
such date a corresponding amount. The Borrower agrees to repay to the
Administrative Agent on demand such amount (until repaid by such Lender) with
interest thereon for each day from the date such amount is made available to the
Borrower until the date such amount is repaid to the Administrative Agent, at
the interest rate applicable to the Obligation that would have been created when
the Administrative Agent made available such amount to the Borrower had such
Lender made a corresponding payment available; provided, however, that such
payment shall not relieve such Lender of any obligation it may have to the
Borrower. In addition, any Lender that shall not have made available to the
Administrative Agent any portion of any payment described above (any such
Lender, a "Non-Funding Lender") agrees to pay such amount to the Administrative
Agent on demand together with interest thereon, for each day from the date such
amount is made available to the Borrower until the date such amount is repaid to
the Administrative Agent, at the Federal Funds Rate for the first Business Day
and thereafter (i) in the case of a payment in respect of a Loan, at the
interest rate applicable at the time to such Loan and (ii) otherwise, at the
interest rate applicable to Base Rate Loans. Such repayment shall then
constitute the funding of the corresponding Loan (including any Loan deemed to
have been made hereunder with such payment) or participation. The existence of
any Non-Funding Lender shall not relieve any other Lender of its obligations
under any Loan Document, but no other Lender shall be responsible for the
failure of any Non-Funding Lender to make any payment required under any Loan
Document.
Section 2.3 [Intentionally Omitted].
Section 2.4 [Intentionally Omitted].
Section 2.5 Termination of the Term Loan Commitments. The Term Loan
Commitments shall terminate on the Term Loan Commitment Termination Date.
Section 2.6 Repayment of Term Loans. The Borrower promises to repay
the Term Loans on the Scheduled Term Loan Maturity Date.
Section 2.7 Optional Prepayments. Subject to the terms of the First
Lien Loan Documents and the Intercreditor Agreement, the Borrower may prepay the
outstanding principal amount of any Loan in whole or in part at any time
(together with the applicable Prepayment Premium, if any, and any breakage costs
that may be owing pursuant to Section 2.16(a) after giving effect to such
prepayment); provided, however, that each partial prepayment that is not of the
entire outstanding amount under the Term Loan Facility shall be in an aggregate
minimum amount of $5,000,000 and integral multiples of $1,000,000 in excess
thereof.
Section 2.8 Mandatory Prepayments. (a) Excess Cash Flow. Subject to
the terms of the First Lien Loan Documents and the Intercreditor Agreement, the
Borrower shall pay
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or cause to be paid to the Administrative Agent, within 10 Business Days after
the last date Financial Statements can be delivered pursuant to Section 6.1(b)
for any Fiscal Year ending after the Closing Date, an amount equal to 50% of the
Excess Cash Flow for such Fiscal Year (or with respect to the Fiscal Year ending
December 31, 2007, Excess Cash Flow for the six-month period then ended);
provided, however, in the event that the Consolidated Leverage Ratio of Holdings
as of the end of any Fiscal Year, commencing with the Fiscal Year ending
December 31, 2009, is less than (x) 5.00:1.00, then such percentage for such
Fiscal Year shall be reduced to 25% or (y) 4.00:1.00, then such percentage for
such Fiscal Year shall be reduced to 0%.
(b) Debt Issuances. Subject to the terms of the First Lien Loan
Documents and the Intercreditor Agreement, upon receipt on or after the Closing
Date by any Loan Party or any of its Subsidiaries of Net Cash Proceeds arising
from the incurrence by any Loan Party or any of its Subsidiaries of Indebtedness
of the type specified in clause (a) or (b) of the definition thereof (other than
any such Indebtedness permitted hereunder in reliance upon Section 8.1), the
Borrower shall immediately pay or cause to be paid to the Administrative Agent
an amount equal to 100% of such Net Cash Proceeds.
(c) Asset Sales and Property Loss Events. Subject to the terms of the
First Lien Loan Documents and the Intercreditor Agreement, upon receipt on or
after the Closing Date by any Loan Party or any of its Subsidiaries of Net Cash
Proceeds arising from (i) any Sale by any Group Member of any of its property
(other than Sales of its own Stock and Excluded Sales, as defined below) to the
extent the Net Cash Proceeds thereof exceed $5,750,000 in any Fiscal Year or
(ii) any Property Loss Event with respect to any property of any Group Member to
the extent resulting, in the aggregate with all other such Property Loss Events,
in the receipt by any of them of Net Cash Proceeds in excess of $5,750,000, the
Borrower shall immediately pay or cause to be paid to the Administrative Agent
an amount equal to 100% of such Net Cash Proceeds (or, with respect to Sales of
property permitted hereunder in reliance upon clause (g) of Section 8.4, 50% of
the Net Cash Proceeds); provided, however, that, upon any such receipt, as long
as no Event of Default shall be continuing, any Group Member may make Permitted
Reinvestments with such Net Cash Proceeds and the Borrower shall not be required
to make or cause such payment to the extent (x) such Net Cash Proceeds are
intended to be used to make Permitted Reinvestments and (y) on each Reinvestment
Prepayment Date for such Net Cash Proceeds, the Borrower shall pay or cause to
be paid to the Administrative Agent an amount equal to the Reinvestment
Prepayment Amount applicable to such Reinvestment Prepayment Date and such Net
Cash Proceeds. "Excluded Sales" shall mean (i) Sales of property permitted
hereunder in reliance upon any of clauses (a) through (d) and (f)(i) of Section
8.4, and (ii) Sales of property permitted hereunder in reliance upon clauses
(f)(ii) and (g) of Section 8.4 if after giving effect to any such Sale and any
prepayment of Loans under this Section 2.8(c) (on a Pro Forma Basis as of the
last day of the last Fiscal Quarter for which Financial Statements have been
delivered hereunder for the 4 Fiscal Quarter period ending on the last day of
such Fiscal Quarter, as if such Sale had occurred on the first day of such
period), the Consolidated Leverage Ratio of Holdings is not greater than 4.00 to
1.00 (it being understood that prepayments from Sales of property permitted
hereunder in reliance upon clauses (f)(ii) and (g) of Section 8.4 shall only be
required to the extent necessary to reduce the Consolidated Leverage Ratio of
Holdings to 4.00 to 1.00).
(d) [Intentionally Omitted].
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(e) Application of Payments. Any payments made to the Administrative
Agent pursuant to this Section 2.8 shall be applied to the Obligations in
accordance with Section 2.12(b).
Notwithstanding anything to the contrary set forth herein, the Borrower shall
not be permitted or required to prepay any Loans under Section 2.8 of this
Agreement unless (i) such prepayment is not prohibited under the Intercreditor
Agreement and (ii) (A) the First Lien Obligations have been paid in full and all
commitments to lend money under the First Lien Loan Documents shall have
terminated, or (B) such amount would be paid to the "Lenders" under and pursuant
to the First Lien Credit Agreement but for the fact that the "Lenders" under the
First Lien Credit Agreement have waived their right to receive such prepayment.
Section 2.9 Interest. (a) Rate. All Loans and the outstanding amount
of all other Obligations shall bear interest, in the case of Loans, on the
unpaid principal amount thereof from the date such Loans are made and, in the
case of such other Obligations, from the date such other Obligations are due and
payable until, in all cases, paid in full, except as otherwise provided in
clause (c) below, as follows: (i) in the case of Base Rate Loans, at a rate per
annum equal to the sum of the Base Rate and the Applicable Margin, each as in
effect from time to time, (ii) in the case of Eurodollar Rate Loans, at a rate
per annum equal to the sum of the Eurodollar Rate and the Applicable Margin,
each as in effect for the applicable Interest Period, and (iii) in the case of
other Obligations, at a rate per annum equal to the sum of the Base Rate and the
Applicable Margin for Base Rate Loans, as in effect from time to time.
(b) Payments. Interest accrued shall be payable in arrears (i) if
accrued on the principal amount of any Loan, (A) at maturity (whether by
acceleration or otherwise), (B) upon the payment or prepayment of the principal
amount on which such interest has accrued and (C)(1) if such Loan is a Base Rate
Loan, on the last day of each calendar quarter commencing on the first such day
following the making of such Loan, (2) if such Loan is a Eurodollar Rate Loan,
on the last day of each Interest Period applicable to such Loan and, if
applicable, on each date during such Interest Period occurring every 3 months
from the first day of such Interest Period and (ii) if accrued on any other
Obligation, on demand from Administrative Agent after the time such Obligation
is due and payable (whether by acceleration or otherwise).
(c) Default Interest. Notwithstanding the rates of interest specified
in clause (a) above or elsewhere in any Loan Document, effective immediately
upon (A) the occurrence of any Event of Default under Section 9.1(e)(ii) or (B)
the delivery of a notice by the Administrative Agent or the Required Lenders to
the Borrower during the continuance of any other Event of Default and, in each
case, for as long as such Event of Default shall be continuing, the principal
balance of all Obligations (including any Obligation that bears interest by
reference to the rate applicable to any other Obligation) then due and payable
shall bear interest at a rate that is 2% per annum in excess of the interest
rate applicable to such Obligations from time to time, payable on demand or, in
the absence of demand, on the date that would otherwise be applicable.
(d) Maximum Lawful Rate. Notwithstanding anything to the contrary set
forth in this Section 2.9, if a court of competent jurisdiction determines in a
final order that the rate of interest payable hereunder exceeds the highest rate
of interest permissible under law (the "Maximum Lawful Rate"), then so long as
the Maximum Lawful Rate would be so exceeded, the rate of interest payable
hereunder shall be equal to the Maximum Lawful Rate; provided, however, that if
at any time thereafter the rate of interest payable hereunder is less than the
35
Maximum Lawful Rate, Borrower shall continue to pay interest hereunder at the
Maximum Lawful Rate until such time as the total interest received by Lenders is
equal to the total interest that would have been received had the interest rate
payable hereunder been (but for the operation of this paragraph) the interest
rate payable since the Closing Date as otherwise provided in this Agreement.
Thereafter, interest hereunder shall be paid at the rate(s) of interest and in
the manner provided in clauses (a) through (c) of this Section 2.9, unless and
until the rate of interest again exceeds the Maximum Lawful Rate, and at that
time this paragraph shall again apply. In no event shall the total interest
received by any Lender pursuant to the terms hereof exceed the amount that such
Lender could lawfully have received had the interest due hereunder been
calculated for the full term hereof at the Maximum Lawful Rate. If the Maximum
Lawful Rate is calculated pursuant to this paragraph, such interest shall be
calculated at a daily rate equal to the Maximum Lawful Rate divided by the
number of days in the year in which such calculation is made. If,
notwithstanding the provisions of this Section 2.9(d), a court of competent
jurisdiction shall finally determine that any Lender has received interest
hereunder in excess of the Maximum Lawful Rate, such Lender shall, to the extent
permitted by applicable law, promptly apply such excess in the order specified
in Section 2.12 and thereafter shall refund any excess to Borrower or as a court
of competent jurisdiction may otherwise order.
Section 2.10 Conversion and Continuation Options. (a) Option. The
Borrower may elect (i) in the case of any Eurodollar Rate Loan, (A) to continue
such Eurodollar Rate Loan or any portion thereof for an additional Interest
Period on the last day of the Interest Period applicable thereto and (B) to
convert such Eurodollar Rate Loan or any portion thereof into a Base Rate Loan
at any time on any Business Day, subject to the payment of any breakage costs
required by Section 2.16(a), and (ii) in the case of Base Rate Loans, to convert
such Base Rate Loans or any portion thereof into Eurodollar Rate Loans at any
time on any Business Day upon 3 Business Days' prior notice; provided, however,
that, (x) for each Interest Period, the aggregate amount of Eurodollar Rate
Loans having such Interest Period must be an integral multiple of $1,000,000 and
(y) no conversion in whole or in part of Base Rate Loans to Eurodollar Rate
Loans and no continuation in whole or in part of Eurodollar Rate Loans shall be
permitted at any time at which (1) a Default or an Event of Default shall be
continuing and the Administrative Agent or the Required Lenders shall have
determined in their sole discretion not to permit such conversions or
continuations or (2) such continuation or conversion would be made during a
suspension imposed by Section 2.15.
(b) Procedure. Each such election shall be made by giving the
Administrative Agent at least 3 Business Days' prior notice in substantially the
form of Exhibit F (a "Notice of Conversion or Continuation") duly completed. The
Administrative Agent shall promptly notify each Lender of its receipt of a
Notice of Conversion or Continuation and of the options selected therein. If the
Administrative Agent does not receive a timely Notice of Conversion or
Continuation from the Borrower containing a permitted election to continue or
convert any Eurodollar Rate Loan, then, upon the expiration of the applicable
Interest Period, such Loan shall be automatically converted to a Base Rate Loan.
Each partial conversion or continuation shall be allocated ratably among the
Lenders in the Term Loan Facility in accordance with their Pro Rata Shares.
Section 2.11 Fees. The Borrower has agreed to pay to the
Administrative Agent and other Persons additional fees, the amount and dates of
payment of which are embodied in the Fee Letter.
36
Section 2.12 Application of Payments. (a) Application of Voluntary
Prepayments. Unless otherwise provided in this Section 2.12 or elsewhere in any
Loan Document, all payments and any other amounts received by the Administrative
Agent from or for the benefit of the Borrower shall be applied to repay the
Obligations the Borrower designates.
(b) Application of Mandatory Prepayments. Subject to the provisions of
clause (c) below with respect to the application of payments during the
continuance of an Event of Default, any payment made by the Borrower to the
Administrative Agent pursuant to Section 2.8 or any other prepayment of the
Obligations required to be applied in accordance with this clause (b) shall be
applied first to repay the outstanding principal balance of the Term Loans
(together with the applicable Prepayment Premium, if any, with respect to any
such prepayment pursuant to Section 2.8(b)) and, then, any excess shall be
retained by the Borrower.
(c) Application of Payments During an Event of Default. Each of
Holdings and the Borrower hereby irrevocably waives, and agrees to cause each
Loan Party and each other Group Member to waive, the right to direct the
application during the continuance of an Event of Default of any and all
payments or prepayments in respect of any Obligation and any proceeds of
Collateral and agrees that, notwithstanding the provisions of clause (a) above,
the Administrative Agent may, and, upon either (A) the direction of the Required
Lenders or (B) the termination of any Term Loan Commitment or the acceleration
of any Obligation pursuant to Section 9.2, shall, apply all payments in respect
of any Obligation, all funds on deposit in any Cash Collateral Account and all
other proceeds of Collateral (i) first, to pay Obligations in respect of any
cost or expense reimbursements, fees or indemnities then due to the
Administrative Agent, (ii) second, to pay Obligations in respect of any cost or
expense reimbursements, fees or indemnities then due to the Lenders, (iii)
third, to pay interest then due and payable in respect of the Loans, (iv)
fourth, to repay the outstanding principal amounts of the Loans (together with
the applicable Prepayment Premium, if any), and (v) fifth, to the ratable
payment of all other Obligations.
(d) Application of Payments Generally. All payments and prepayments of
any Term Loans shall be applied first, to repay such Loans outstanding as Base
Rate Loans and then, to repay such Loans outstanding as Eurodollar Rate Loans,
with those Eurodollar Rate Loans having earlier expiring Interest Periods being
repaid prior to those having later expiring Interest Periods. All payments and
prepayments of Term Loans shall be applied to reduce ratably the remaining
installments of such outstanding principal amounts of the Term Loans. If
sufficient amounts are not available to repay all outstanding Obligations
described in any priority level set forth in this Section 2.12, the available
amounts shall be applied, unless otherwise expressly specified herein, to such
Obligations ratably based on the proportion of the Secured Parties' interest in
such Obligations. Any priority level set forth in this Section 2.12 that
includes interest shall include all such interest, whether or not accruing after
the filing of any petition in bankruptcy or the commencement of any insolvency,
reorganization or similar proceeding, and whether or not a claim for post-filing
or post-petition interest is allowed in any such proceeding.
Section 2.13 Payments and Computations. (a) Procedure. The Borrower
shall make each payment under any Loan Document not later than 11:00 a.m. on the
day when due to the Administrative Agent by wire transfer to the following
account (or at such other account or by such other means to such other address
as the Administrative Agent shall have notified the Borrower in writing within a
reasonable time prior to such payment) in immediately available Dollars and
without setoff or counterclaim:
37
ABA No. 000-000-000
Account Number 000-000-00
Deutsche Bank Trust Company Americas, New York, New York
Account Name: GECC HH Cash Flow
Reference: GE Capital Re Inverness Medical Innovations (Second Lien)
The Administrative Agent shall promptly thereafter cause to be distributed
immediately available funds relating to the payment of principal, interest,
Prepayment Premium or fees to the Lenders, in accordance with the application of
payments set forth in Section 2.12. The Lenders shall make any payment under any
Loan Document in immediately available Dollars and without setoff or
counterclaim. Payments received by the Administrative Agent after 11:00 a.m.
shall be deemed to be received on the next Business Day.
(b) Computations of Interests and Fees. All computations of interest
and of fees shall be made by the Administrative Agent on the basis of a year of
360 days (or, in the case of Base Rate Loans, 365/366 days), in each case for
the actual number of days (including the first day but excluding the last day)
occurring in the period for which such interest and fees are payable. Each
determination of an interest rate or the amount of a fee hereunder shall be made
by the Administrative Agent (including determinations of a Eurodollar Rate or
Base Rate in accordance with the definitions of "Eurodollar Rate" and "Base
Rate", respectively) and shall be conclusive, binding and final for all
purposes, absent manifest error.
(c) Payment Dates. Whenever any payment hereunder shall be stated to
be due on a day other than a Business Day, the due date for such payment shall
be extended to the next succeeding Business Day without any increase in such
payment as a result of additional interest or fees; provided, however, that such
interest and fees shall continue accruing as a result of such extension of time.
(d) Advancing Payments. Unless the Administrative Agent shall have
received notice from the Borrower prior to the date on which any payment is due
hereunder that the Borrower will not make such payment in full, the
Administrative Agent may assume that the Borrower has made such payment in full
to the Administrative Agent on such date and the Administrative Agent may, in
reliance upon such assumption, cause to be distributed to each Lender on such
due date an amount equal to the amount then due such Lender. If and to the
extent that the Borrower shall not have made such payment in full to the
Administrative Agent, each Lender shall repay to the Administrative Agent on
demand such amount distributed to such Lender together with interest thereon (at
the Federal Funds Rate for the first Business Day and thereafter, at the rate
applicable to Base Rate Loans) for each day from the date such amount is
distributed to such Lender until the date such Lender repays such amount to the
Administrative Agent.
Section 2.14 Evidence of Debt. (a) Records of Lenders. Each Lender
shall maintain in accordance with its usual practice accounts evidencing
Indebtedness of the Borrower to such Lender resulting from each Loan of such
Lender from time to time, including the amounts of principal and interest
payable and paid to such Lender from time to time under this Agreement. In
addition, each Lender having sold a participation in any of its Obligations or
having identified an SPV as such to the Administrative Agent, acting as agent of
the Borrower solely for this purpose and solely for tax purposes, shall
establish and maintain at its address referred to in Section 11.11 (or at such
other address as such Lender shall notify the Borrower) a record of
38
ownership, in which such Lender shall register by book entry (A) the name and
address of each such participant and SPV (and each change thereto, whether by
assignment or otherwise) and (B) the rights, interest or obligation of each such
participant and SPV in any Obligation, in any Commitment and in any right to
receive any payment hereunder.
(b) Records of Administrative Agent. The Administrative Agent, acting
as agent of the Borrower solely for tax purposes and solely with respect to the
actions described in this Section 2.14, shall establish and maintain at its
address referred to in Section 11.11 (or at such other address as the
Administrative Agent may notify the Borrower) (A) a record of ownership (the
"Register") in which the Administrative Agent agrees to register by book entry
the interests (including any rights to receive payment hereunder) of the
Administrative Agent, each Lender in the Term Loans, each of their obligations
under this Agreement to participate in each Loan, and any assignment of any such
interest, obligation or right and (B) accounts in the Register in accordance
with its usual practice in which it shall record (1) the names and addresses of
the Lenders (and each change thereto pursuant to Section 2.18 (Substitution of
Lenders) and Section 11.2 (Assignments and Participations; Binding Effect), (2)
the Term Loan Commitments of each Lender, (3) the amount of each Loan and each
funding of any participation described in clause (A) above, and for Eurodollar
Rate Loans, the Interest Period applicable thereto, (4) the amount of any
principal or interest due and payable or paid, and (5) any other payment
received by the Administrative Agent from the Borrower and its application to
the Obligations.
(c) Registered Obligations. Notwithstanding anything to the contrary
contained in this Agreement, the Loans (including any Notes evidencing such
Loans) are registered obligations, the right, title and interest of the Lenders
and their assignees in and to such Loans shall be transferable only upon
notation of such transfer in the Register and no assignment thereof shall be
effective until recorded therein. This Section 2.14 and Section 11.2 shall be
construed so that the Loans are at all times maintained in "registered form"
within the meaning of Sections 163(f), 871(h)(2) and 881(c)(2) of the Code and
any related regulations (and any successor provisions).
(d) Prima Facie Evidence. The entries made in the Register and in the
accounts maintained pursuant to clauses (a) and (b) above shall, to the extent
permitted by applicable Requirements of Law, be prima facie evidence of the
existence and amounts of the obligations recorded therein; provided, however,
that no error in such account and no failure of any Lender or the Administrative
Agent to maintain any such account shall affect the obligations of any Loan
Party to repay the Loans in accordance with their terms. In addition, the Loan
Parties, the Administrative Agent and the Lenders shall treat each Person whose
name is recorded in the Register as a Lender for all purposes of this Agreement.
Information contained in the Register with respect to any Lender shall be
available for access by the Borrower, the Administrative Agent, or such Lender
at any reasonable time and from time to time upon reasonable prior notice. No
Lender shall have access to or be otherwise permitted to review any information
in the Register other than information with respect to such Lender unless
otherwise agreed by the Administrative Agent.
(e) Notes. Upon any Lender's request, the Borrower shall promptly
execute and deliver Notes to such Lender evidencing the Loans of such Lender in
the Term Loan Facility and substantially in the form of Exhibit B; provided,
however, that only one Note for the Term Loan Facility shall be issued to each
Lender, except (i) to an existing Lender exchanging existing Notes to reflect
changes in the Register relating to such Lender, in which case the new Notes
delivered to such Lender shall be dated the date of the original Notes and (ii)
in the case of loss,
39
destruction or mutilation of existing Notes and similar circumstances. Each
Note, if issued, shall only be issued as means to evidence the right, title or
interest of a Lender or a registered assignee in and to the related Loan, as set
forth in the Register, and in no event shall any Note be considered a bearer
instrument or obligation.
Section 2.15 Suspension of Eurodollar Rate Option. Notwithstanding any
provision to the contrary in this Article II, the following shall apply:
(a) Interest Rate Unascertainable, Inadequate or Unfair. In the event
that (A) the Administrative Agent determines that adequate and fair means do not
exist for ascertaining the applicable interest rates by reference to which the
Eurodollar Rate is determined or (B) the Required Lenders notify the
Administrative Agent that the Eurodollar Rate for any Interest Period will not
adequately reflect the cost to the Lenders of making or maintaining such Loans
for such Interest Period, the Administrative Agent shall promptly so notify the
Borrower and the Lenders, whereupon the obligation of each Lender to make or to
continue Eurodollar Rate Loans shall be suspended as provided in clause (c)
below until the Administrative Agent shall notify the Borrower that the Required
Lenders have determined that the circumstances causing such suspension no longer
exist.
(b) Illegality. If any Lender determines that the introduction of, or
any change in or in the interpretation of, any Requirement of Law after the date
of this Agreement shall make it unlawful, or any Governmental Authority shall
assert that it is unlawful, for any Lender or its applicable lending office to
make Eurodollar Rate Loans or to continue to fund or maintain Eurodollar Rate
Loans, then, on notice thereof and demand therefor by such Lender to the
Borrower through the Administrative Agent, the obligation of such Lender to make
or to continue Eurodollar Rate Loans shall be suspended as provided in clause
(c) below until such Lender shall, through the Administrative Agent, notify the
Borrower that it has determined that it may lawfully make Eurodollar Rate Loans.
(c) Effect of Suspension. If the obligation of any Lender to make or
to continue Eurodollar Rate Loans is suspended, (A) the obligation of such
Lender to convert Base Rate Loans into Eurodollar Rate Loans shall be suspended,
(B) such Lender shall make a Base Rate Loan at any time such Lender would
otherwise be obligated to make a Eurodollar Rate Loan, (C) the Borrower may
revoke any pending Notice of Borrowing or Notice of Conversion or Continuation
to make or continue any Eurodollar Rate Loan or to convert any Base Rate Loan
into a Eurodollar Rate Loan and (D) each Eurodollar Rate Loan of such Lender
shall automatically and immediately (or, in the case of any suspension pursuant
to clause (a) above, on the last day of the current Interest Period thereof) be
converted into a Base Rate Loan.
Section 2.16 Breakage Costs; Increased Costs; Capital Requirements.
(a) Breakage Costs. The Borrower shall compensate each Lender, upon demand from
such Lender to the Borrower (with copy to the Administrative Agent), for all
Liabilities (including, in each case, those incurred by reason of the
liquidation or reemployment of deposits or other funds acquired by such Lender
to prepare to fund, to fund or to maintain the Eurodollar Rate Loans of such
Lender to the Borrower but excluding any loss of the Applicable Margin on the
relevant Loans) that such Lender may incur (A) to the extent, for any reason
other than solely by reason of such Lender being a Non-Funding Lender, a
proposed Borrowing, conversion into or continuation of Eurodollar Rate Loans
does not occur on a date specified therefor in a Notice of Borrowing or a Notice
of Conversion or Continuation or in a similar request made by telephone by the
Borrower, (B) to the extent any Eurodollar Rate Loan is paid (whether through a
scheduled, optional or
40
mandatory prepayment) or converted to a Base Rate Loan (including because of
Section 2.15) on a date that is not the last day of the applicable Interest
Period or (C) as a consequence of any failure by the Borrower to repay
Eurodollar Rate Loans when required by the terms hereof. For purposes of this
clause (a), each Lender shall be deemed to have funded each Eurodollar Rate Loan
made by it using a matching deposit or other borrowing in the London interbank
market.
(b) Increased Costs. If at any time any Lender determines that, after
the later of (x) the date hereof and (y) the date such Lender entered into this
Agreement (including by assignment) as such, the adoption of, or any change in
or in the interpretation, application or administration of, or compliance with,
any Requirement of Law (other than any imposition or increase of Eurodollar
Reserve Requirements) from any Governmental Authority shall have the effect of
(i) increasing the cost to such Lender of making, funding or maintaining any
Eurodollar Rate Loan or to agree to do so or of participating, or agreeing to
participate, in extensions of credit, or (ii) imposing any other cost to such
Lender with respect to compliance with its obligations under any Loan Document,
then, upon demand by such Lender (with copy to the Administrative Agent), the
Borrower shall pay to the Administrative Agent for the account of such Lender
amounts sufficient to compensate such Lender for such increased cost.
(c) Increased Capital Requirements. If at any time any Lender
determines that, after the later of (x) the date hereof and (y) the date such
Lender entered into this Agreement (including by assignment) as such, the
adoption of, or any change in or in the interpretation, application or
administration of, or compliance with, any Requirement of Law (other than any
imposition or increase of Eurodollar Reserve Requirements) from any Governmental
Authority regarding capital adequacy, reserves, special deposits, compulsory
loans, insurance charges against property of, deposits with or for the account
of, Obligations owing to, or other credit extended or participated in by, any
Lender or any similar requirement (in each case other than any imposition or
increase of Eurodollar Reserve Requirements) shall have the effect of reducing
the rate of return on the capital of such Lender (or any corporation controlling
such Lender) as a consequence of its obligations under or with respect to any
Loan Document to a level below that which, taking into account the capital
adequacy policies of such Lender or corporation, such Lender or corporation
could have achieved but for such adoption or change, then, upon demand from time
to time by such Lender (with a copy of such demand to the Administrative Agent),
the Borrower shall pay to the Administrative Agent for the account of such
Lender amounts sufficient to compensate such Lender for such reduction.
(d) Compensation Certificate. Each demand for compensation under this
Section 2.16 shall be accompanied by a certificate of the Lender claiming such
compensation, setting forth in reasonable detail the amounts to be paid
hereunder, which certificate shall be conclusive, binding and final for all
purposes, absent manifest error. In determining such amount, such Lender may use
any reasonable averaging and attribution methods.
Section 2.17 Taxes. (a) Payments Free and Clear of Taxes. Except as
otherwise provided in this Section 2.17, each payment by any Loan Party under
any Loan Document shall be made free and clear of all present or future taxes,
levies, imposts, deductions, charges or withholdings and all liabilities with
respect thereto (and without deduction for any of them) (collectively, "Taxes")
except for (i) taxes measured by net income (including branch profits taxes) and
franchise taxes imposed in lieu of net income taxes, in each case imposed on any
Secured Party as a result of a present or former connection between such Secured
Party and the jurisdiction of the Governmental Authority imposing such tax or
any political subdivision or taxing authority thereof or therein (other than
such connection arising solely from any Secured
41
Party having executed, delivered or performed its obligations or received a
payment under, or enforced, any Loan Document), (ii) United States federal
withholding taxes to the extent that the obligation to withhold amounts existed
on the date that such Secured Party became a "Secured Party" hereunder except to
the extent such Secured Party is a direct or indirect assignee (other than
pursuant to clause (iii) of Section 2.18(a) (Substitution of Lenders)) of any
other Secured Party that was entitled, at the time the assignment from such
other Secured Party became effective, to receive additional amounts under this
clause, or (iii) taxes that would not have been imposed but for the failure
(other than as a result of a change in any Requirement of Law) by any Secured
Party to deliver the documentation required to be delivered pursuant to clause
(f) below (all such Taxes described in clauses (i), (ii) and (iii) of this
Section 2.17 being referred to collectively as "Excluded Taxes").
(b) Gross-Up. If any Taxes other than Excluded Taxes shall be required
by law to be deducted from or in respect of any amount payable under any Loan
Document to any Secured Party (i) such amount shall be increased as necessary to
ensure that, after all required deductions for Taxes are made (including
deductions applicable to any increases to any amount under this Section 2.17),
such Secured Party receives the amount it would have received had no such
deductions been made, (ii) the relevant Loan Party shall make such deductions,
(iii) the relevant Loan Party shall timely pay the full amount deducted to the
relevant taxing authority or other authority in accordance with applicable
Requirements of Law and (iv) within 30 days after such payment is made, or as
soon as practicable thereafter, the relevant Loan Party shall deliver to the
Administrative Agent an original or certified copy of a receipt evidencing such
payment.
(c) Other Taxes. In addition, the Borrower agrees to pay, and
authorizes the Administrative Agent to pay in its name, any stamp, documentary,
excise or property tax, charges or similar levies imposed by any applicable
Requirement of Law or Governmental Authority and all Liabilities with respect
thereto (including by reason of any delay in payment thereof), in each case
arising from the execution, delivery or registration of, or otherwise with
respect to, any Loan Document or any transaction contemplated therein
(collectively, "Other Taxes"). Within 30 days after the date of any payment of
Taxes or Other Taxes by any Loan Party, the Borrower shall furnish to the
Administrative Agent, at its address referred to in Section 11.11, the original
or a certified copy of a receipt evidencing payment thereof.
(d) Indemnification. The Borrower shall reimburse and indemnify,
within 30 days after receipt of demand therefor (with copy to the Administrative
Agent), each Secured Party for all Taxes (other than Excluded Taxes) and Other
Taxes (including any Taxes (other than Excluded Taxes) and Other Taxes imposed
by any jurisdiction on amounts payable under this Section 2.17) paid by such
Secured Party and any Liabilities arising therefrom or with respect thereto,
whether or not such Taxes (other than Excluded Taxes) or Other Taxes were
correctly or legally asserted. A certificate of the Secured Party (or of the
Administrative Agent on behalf of such Secured Party) claiming any compensation
under this clause (d), setting forth the amounts to be paid thereunder and
delivered to the Borrower with copy to the Administrative Agent, shall be
conclusive, binding and final for all purposes, absent manifest error. In
determining such amount, the Administrative Agent and such Secured Party may use
any reasonable averaging and attribution methods.
(e) Mitigation. Any Lender claiming any additional amounts payable
pursuant to this Section 2.17 shall use its reasonable efforts (consistent with
its internal policies and Requirements of Law) to file any certificate or
document reasonably requested in writing by Borrower or to change the
jurisdiction of its lending office if such a change would reduce any
42
such additional amounts (or any similar amount that may thereafter accrue) and
would not, in the sole determination of such Lender, be otherwise
disadvantageous to such Lender.
(f) Tax Forms. (i) Each Non-U.S. Lender Party that, at any of the
following times, is entitled to an exemption from United States withholding tax
or, after a change in any Requirement of Law, is subject to such withholding tax
at a reduced rate under an applicable tax treaty, shall (w) on or prior to the
date such Non-U.S. Lender Party becomes a "Non-U.S. Lender Party" hereunder, (x)
on or prior to the date on which any such form or certification expires or
becomes obsolete, (y) after the occurrence of any event requiring a change in
the most recent form or certification previously delivered by it pursuant to
this clause (i) and (z) from time to time if requested by the Borrower or the
Administrative Agent (or, in the case of a participant or SPV, the relevant
Lender), provide the Administrative Agent and the Borrower (or, in the case of a
participant or SPV, the relevant Lender) with two completed originals of each of
the following, as applicable: (A) Forms W-8ECI (claiming exemption from U.S.
withholding tax because the income is effectively connected with a U.S. trade or
business), W-8BEN (claiming exemption from, or a reduction of, U.S. withholding
tax under an income tax treaty) or any successor forms, (B) in the case of a
Non-U.S. Lender Party claiming exemption under Sections 871(h) or 881(c) of the
Code, Form W-8BEN (claiming exemption from U.S. withholding tax under the
portfolio interest exemption) or any successor form and a certificate in form
and substance acceptable to the Administrative Agent that such Non-U.S. Lender
Party is not (1) a "bank" within the meaning of Section 881(c)(3)(A) of the
Code, (2) a "10 percent shareholder" of the Borrower within the meaning of
Section 881(c)(3)(B) of the Code or (3) a "controlled foreign corporation"
described in Section 881(c)(3)(C) of the Code or (C) any other applicable
document prescribed by the IRS certifying as to the entitlement of such Non-U.S.
Lender Party to such exemption from United States withholding tax or reduced
rate with respect to all payments to be made to such Non-U.S. Lender Party under
the Loan Documents. Unless the Borrower and the Administrative Agent have
received forms or other documents satisfactory to them indicating that payments
under any Loan Document to or for a Non-U.S. Lender Party are not subject to
United States withholding tax or are subject to such tax at a rate reduced by an
applicable tax treaty, the Loan Parties and the Administrative Agent shall
withhold amounts required to be withheld by applicable Requirements of Law from
such payments at the applicable statutory rate.
(i) Each U.S. Lender Party shall (A) on or prior to the date such
U.S. Lender Party becomes a "U.S. Lender Party" hereunder, (B) on or prior
to the date on which any such form or certification expires or becomes
obsolete, (C) after the occurrence of any event requiring a change in the
most recent form or certification previously delivered by it pursuant to
this clause (f) and (D) from time to time if requested by the Borrower or
the Administrative Agent (or, in the case of a participant or SPV, the
relevant Lender), provide the Administrative Agent and the Borrower (or, in
the case of a participant or SPV, the relevant Lender) with two completed
originals of Form W-9 (certifying that such U.S. Lender Party is entitled
to an exemption from U.S. backup withholding tax) or any successor form.
(ii) Each Lender having sold a participation in any of its
Obligations or identified an SPV as such to the Administrative Agent shall
collect from such participant or SPV the documents described in this clause
(f) and provide them to the Administrative Agent and the Borrower.
Section 2.18 Substitution of Lenders. (a) Substitution Right. In the
event that any Lender in the Term Loan Facility that is not an Affiliate of the
Administrative Agent (an
43
"Affected Lender"), (i) makes a claim under clause (b) (Increased Costs) or (c)
(Increased Capital Requirements) of Section 2.16, (ii) notifies the Borrower
pursuant to Section 2.15(b) (Illegality) that it becomes illegal for such Lender
to continue to fund or make any Eurodollar Rate Loan in the Term Loan Facility,
(iii) makes a claim for payment pursuant to Section 2.17(b) (Taxes), (iv)
becomes a Non-Funding Lender with respect to the Term Loan Facility or (v) does
not consent to any amendment, waiver or consent to any Loan Document for which
the consent of the Required Lenders is obtained but that requires the consent of
other Lenders in the Term Loan Facility, the Borrower may either pay in full
such Affected Lender with respect to amounts due in the Term Loan Facility with
the consent of the Administrative Agent or substitute for such Affected Lender
in the Term Loan Facility any Lender or any Affiliate or Approved Fund of any
Lender or any other Person acceptable (which acceptance shall not be
unreasonably withheld or delayed) to the Administrative Agent (in each case, a
"Substitute Lender").
(b) Procedure. To substitute such Affected Lender or pay in full the
Obligations owed to such Affected Lender under the Term Loan Facility, the
Borrower shall deliver a notice to the Administrative Agent and such Affected
Lender. The effectiveness of such payment or substitution shall be subject to
the delivery to the Administrative Agent by the Borrower (or, as may be
applicable in the case of a substitution, by the Substitute Lender) of (i)
payment for the account of such Affected Lender of, to the extent accrued
through, and outstanding on, the effective date for such payment or
substitution, all Obligations owing to such Affected Lender with respect to the
Term Loan Facility (including those that will be owed because of such payment),
and (ii) in the case of a substitution, (A) payment of the assignment fee set
forth in Section 11.2(c) and (B) an assumption agreement in form and substance
satisfactory to the Administrative Agent whereby the Substitute Lender shall,
among other things, agree to be bound by the terms of the Loan Documents and
assume the Commitment of the Affected Lender under the Term Loan Facility.
(c) Effectiveness. Upon satisfaction of the conditions set forth in
clause (b) above, the Administrative Agent shall record such substitution or
payment in the Register, whereupon (i) in the case of any payment in full in the
Term Loan Facility, such Affected Lender's Term Loan Commitments in the Term
Loan Facility shall be terminated and (ii) in the case of any substitution in
the Term Loan Facility, (A) the Affected Lender shall sell and be relieved of,
and the Substitute Lender shall purchase and assume, all rights and claims of
such Affected Lender under the Loan Documents with respect to the Term Loan
Facility, except that the Affected Lender shall retain such rights expressly
providing that they survive the repayment of the Obligations and the termination
of the Term Loan Commitments, (B) the Substitute Lender shall become a "Lender"
hereunder having a Commitment in the Term Loan Facility in the amount of such
Affected Lender's Commitment in the Term Loan Facility and (C) the Affected
Lender shall execute and deliver to the Administrative Agent an Assignment to
evidence such substitution and deliver any Note in its possession with respect
to the Term Loan Facility; provided, however, that the failure of any Affected
Lender to execute any such Assignment or deliver any such Note shall not render
such sale and purchase (or the corresponding assignment) invalid.
Section 2.19 Acquisition Cash Collateral Account. On the Merger
Funding Date and on any Subsequent Tender Funding Date, the Administrative Agent
shall release (and shall provide a written direction to the financial
institution where such account is held to release to Borrower in accordance with
the terms of the applicable deposit account control agreement) funds in the
Acquisition Cash Collateral Account for application, first, if such date is the
Merger
44
Funding Date, to payment of the "Merger Consideration" (as defined in the
Acquisition Agreement) (and if such date is a Subsequent Tender Funding Date
(whether or not the Merger Funding Date), payment for any Target Shares then
subject to purchase by AcquisitionCo pursuant to the Tender Offer in accordance
with the terms of the Acquisition Agreement and the Tender Offer) plus, in each
case if applicable, any associated costs, expenses or other related payment
obligations, and, second, if such date is the Merger Funding Date, to the extent
of any remaining such funds, to the Borrower's account, all as directed by the
Borrower; provided that (a) no Material Event of Default shall be continuing,
(b) if such date is the Merger Funding Date, the Effective Time (as defined in
the Acquisition Agreement) shall have occurred (or shall occur substantially
concurrently with such release) in accordance pursuant to the Acquisition
Agreement in compliance in all material respects with the applicable provisions
of Delaware law, and (c) the Borrower shall have given to the Administrative
Agent a notice of the release of funds from the Acquisition Cash Collateral
Account not later than 10:00 a.m. on the applicable funding date or such later
time as may be agreed upon by the Administrative Agent. Without limitation of
any rights or remedies provided under Section 9.2, there shall be no other
conditions to the Administrative Agent's obligation to release the funds from
the Acquisition Cash Collateral Account on the Merger Funding Date or on any
Subsequent Tender Funding Date as provided above.
ARTICLE III
CONDITIONS TO LOANS
Section 3.1 Conditions Precedent to Loans on the Closing Date. The
obligation of each Lender to make any Loan on the Closing Date is subject to the
satisfaction or due waiver of each of the following conditions precedent:
(a) Certain Documents. The Administrative Agent shall have received on
or prior to the Closing Date each of the following, each dated the Closing Date
unless otherwise agreed by the Administrative Agent, in form and substance
reasonably satisfactory to the Administrative Agent and each Lender:
(i) this Agreement duly executed by Holdings and the Borrower
and, for the account of each Lender having requested the same by notice to
the Administrative Agent and the Borrower received by each at least 3
Business Days prior to the Closing Date (or such later date as may be
agreed by the Borrower), Notes conforming to the requirements set forth in
Section 2.14(e);
(ii) the Guaranty and Security Agreement, duly executed by each
Loan Party (which for purposes of this Section 3.1(a) shall not include the
Target or any of its Subsidiaries if the Closing Date is not also the
Merger Funding Date), together with (A) copies of UCC, Intellectual
Property and other appropriate search reports and of all effective prior
filings listed therein, together with evidence of the termination of such
prior filings and other documents with respect to the priority of the
security interest of the Administrative Agent in the Collateral, in each
case as may be reasonably requested by the Administrative Agent, (B) except
to the extent otherwise expressly provided under Section 7.15, all
documents representing all Securities, chattel paper and instruments being
pledged pursuant to such Guaranty and Security Agreement and related
undated powers or endorsements duly executed in blank, and (C) except to
the extent otherwise expressly provided under Section 7.15, all Control
Agreements that, in the reasonable
45
judgment of the Administrative Agent, are required for the Loan Parties to
comply with the Loan Documents as of the Closing Date, each duly executed
by the parties thereto;
(iii) the Intercreditor Agreement duly executed by the
Administrative Agent, First Lien Administrative Agent, Holdings, the
Borrower and the other Loan Parties;
(iv) duly executed favorable opinions of counsel to the Loan
Parties in New York and in each other jurisdiction in which a Loan Party
(other than the Inactive Subsidiaries) is organized, satisfactory to the
Administrative Agent, each addressed to the Administrative Agent and the
Lenders and addressing such matters as the Administrative Agent may
reasonably request;
(v) a copy of each Constituent Document of each Loan Party (other
than the Inactive Subsidiaries) that is on file with any Governmental
Authority in any jurisdiction, certified as of a recent date by such
Governmental Authority, together with, if applicable, certificates
attesting to the good standing of such Loan Party in such jurisdiction;
(vi) a certificate of the secretary, assistant secretary or other
officer of each Loan Party (other than the Inactive Subsidiaries) in charge
of maintaining books and records of such Loan Party certifying as to (A)
the names and signatures of each officer of such Loan Party authorized to
execute and deliver any Loan Document and who will execute any such Loan
Document, (B) the Constituent Documents of such Loan Party attached to such
certificate are complete and correct copies of such Constituent Documents
as in effect on the date of such certification (or, for any such
Constituent Document delivered pursuant to clause (v) above, that there
have been no changes from such Constituent Document so delivered) and (C)
the resolutions of such Loan Party's board of directors or other
appropriate governing body approving and authorizing the execution,
delivery and performance of each Loan Document to which such Loan Party is
a party;
(vii) a certificate of a Responsible Officer of Holdings to the
effect that each condition set forth in Section 3.1(c) (to such Responsible
Officer's knowledge), Section 3.1(d) and Section 3.2(b) has been satisfied;
(viii) a certificate of a Responsible Officer of Holdings to the
effect that Holdings and its Subsidiaries taken as a group on a
consolidated basis are Solvent after giving effect to the borrowing of the
Loans, the consummation of the Related Transactions, the application of the
proceeds thereof in accordance with Section 7.9 and the payment of all
estimated legal, accounting and other fees and expenses related hereto and
thereto;
(ix) insurance certificates in form and substance satisfactory to
the Administrative Agent demonstrating that the insurance policies required
by Section 7.5 are in full force and effect and have all endorsements
required by such Section 7.5;
(x) copies of the financial statements, projections and Pro Forma
Financial Statements referred to in Section 4.4; and
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(xi) such other documents and information as any Lender through
the Administrative Agent may reasonably request.
(b) Fee and Expenses. There shall have been paid to the Administrative
Agent, for the account of the Administrative Agent, its Related Persons, any
Lender, as the case may be, all fees and all reimbursements of costs or
expenses, in each case due and payable under any Loan Document on or before the
Closing Date and which are presented to the Borrower no less than one Business
Day prior to the Closing Date.
(c) Company Material Adverse Effect. The absence of a "Company
Material Adverse Effect" (as defined in the Acquisition Agreement).
(d) Acquisition. The Acquisition Agreement (including all schedules
and exhibits thereto) shall not have been altered, amended or otherwise changed
or supplemented in any material respect or any condition therein waived without
the prior written consent of the Administrative Agent and the Required Lenders
to the extent that the Lenders are adversely affected thereby. The Acceptance
Time (as defined in the Acquisition Agreement) shall have occurred (or shall
occur substantially concurrently with the initial Loans on the Closing Date) in
accordance with the Acquisition Agreement and in compliance in all material
respects with applicable law. If the Closing Date is also the Merger Funding
Date, the Effective Time (as defined in the Acquisition Agreement) shall have
occurred (or shall occur substantially concurrently with the Loans made on such
date) pursuant to the Acquisition Agreement and in compliance in all material
respects with the applicable provisions of Delaware law.
(e) First Lien Term Loans. Concurrently with the Loans made hereunder
on the Closing Date, the Borrower shall have received the gross cash proceeds
from the borrowing of the First Lien Term Loans in a principal amount of
$900,000,000 and a portion of the revolving loans under the First Lien Credit
Agreement, if any, substantially as is set forth in the sources and uses for the
Related Transactions delivered by Holdings to the Administrative Agent. The
terms and conditions of the First Lien Term Loans and the First Lien Loan
Documents shall be in form and substance satisfactory to the Administrative
Agent.
(f) Application of Cash. The Group Members shall have applied (or
substantially simultaneously with the funding of the Loans shall apply) such
cash of the Group Members to fund the Related Transactions on the Closing Date
substantially as is set forth in the sources and uses for the Related
Transactions delivered by Holdings to the Administrative Agent (the "Group
Member Cash Payment").
(g) Indebtedness; Payoff Debt. After giving effect to the Related
Transactions, the Group Members shall have no outstanding Indebtedness or
preferred stock other than (i) Indebtedness permitted under Section 8.1, and
(ii) preferred stock outstanding on the date hereof or any right, warrant or
other agreement to issue preferred stock outstanding under agreements in effect
as of the date hereof. All Payoff Debt will have been repaid, redeemed or
otherwise satisfied in full and all Liens securing the Payoff Debt terminated
and released, as evidenced by a payoff letter or other documentation
satisfactory to the Administrative Agent duly executed and delivered by the
holders of the applicable Payoff Debt or an agent or trustee thereof or
otherwise satisfactory to the Administrative Agent.
(h) Consents. All material governmental consents and approvals
required as a condition to the Acquisition under the terms of the Acquisition
Agreement shall have been
47
obtained and shall remain in effect and all applicable material waiting periods
shall have expired or been terminated and all other material foreign antitrust
and competition approvals required to consummate the Acquisition shall have been
obtained (in the case of foreign legal requirements or approvals, only if such
legal requirements or approvals: (a) would have suspensory effect, (b) if not
obtained would reasonably be expected to result in material limitations on the
ownership or operation by any Group Member or (c) if not obtained, would subject
any Group Member to the payment of a material fine or penalty); and no law or
regulation shall be applicable in the reasonable judgment of the Administrative
Agent that restrains, prevents or imposes materially adverse conditions upon the
Related Transactions or the other transactions contemplated herein.
Section 3.2 Conditions Precedent to Each Loan. The obligation of each
Lender on the Closing Date to make any Loan is subject to the satisfaction of
each of the following conditions precedent, in addition to those set forth in
Section 3.1:
(a) Request. The Administrative Agent shall have received, to the
extent required by Article II, a written, timely and duly executed and completed
Notice of Borrowing.
(b) Representations and Warranties; No Defaults. The following
statements shall be true on such date, both before and after giving effect to
such Loan: (i) the representations and warranties set forth in any Loan Document
shall be true and correct in all material respects (provided, that if any
representation or warranty is by its terms qualified by concepts of materiality,
such representation shall be true and correct in all respects) on and as of such
date or, to the extent such representations and warranties expressly relate to
an earlier date, on and as of such earlier date and (ii) no Default or Event of
Default shall be continuing; provided that, notwithstanding the foregoing, (x)
the only representations relating to the Group Members and their businesses the
making of which shall be a condition to availability of the Loans on the Closing
Date shall be (A) such of the representations made by the Target in the
Acquisition Agreement, as are material to the interests of the Lenders, but only
to the extent that Holdings has the right to terminate its obligations under the
Acquisition Agreement as a result of a breach of such representations in the
Acquisition Agreement and (B) the Specified Representations. For purposes
hereof, "Specified Representations" means the representations and warranties set
forth in the Loan Documents relating to corporate power and authority of the
Loan Parties to execute, deliver and perform the Loan Documents, and due
authorization, execution and delivery of the Loan Documents by the Loan Parties,
no conflicts with material contractual restrictions by the Loan Parties'
execution, delivery and performance of the Loan Documents, the enforceability of
the Loan Documents against the Loan Parties, and compliance by the Loan Parties
with Federal Reserve margin regulations and the Investment Company Act.
The representations and warranties set forth in any Notice of Borrowing (or any
certificate delivered in connection therewith) shall be deemed to be made again
on and as of the date of the relevant Loan and the acceptance of the proceeds
thereof.
Section 3.3 [Intentionally Omitted].
Section 3.4 Determinations of Initial Borrowing Conditions. For
purposes of determining compliance with the conditions specified in Section 3.1,
each Lender shall be deemed to be satisfied with each document and each other
matter required to be satisfactory to such Lender unless, prior to the Closing
Date the Administrative Agent receives notice from such Lender specifying such
Lender's objections and such Lender has not made available its Pro Rata Share of
any Borrowing scheduled to be made on the Closing Date.
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ARTICLE IV
REPRESENTATIONS AND WARRANTIES
To induce the Lenders and the Administrative Agent to enter into the
Loan Documents, each of Holdings and the Borrower (and, to the extent set forth
in any other Loan Document, each other Loan Party) represents and warrants to
each of them each of the following on and as of each date applicable pursuant to
Section 3.2:
Section 4.1 Corporate Existence; Compliance with Law. Each Group
Member (a) is duly organized, validly existing and in good standing under the
laws of the jurisdiction of its organization, (b) is duly qualified to do
business as a foreign entity and in good standing under the laws of each
jurisdiction where such qualification is necessary, except where the failure to
be so qualified or in good standing could not reasonably be expected to have,
either individually or in the aggregate, a Material Adverse Effect, (c) has all
requisite power and authority and the legal right to own, pledge, mortgage and
operate its property, to lease or sublease any property it operates under lease
or sublease and to conduct its business as now or currently proposed to be
conducted, (d) is in compliance with its Constituent Documents, (e) is in
compliance with all applicable Requirements of Law (including all Healthcare
Laws) except where the failure to be in compliance could not reasonably be
expected to have, either individually or in the aggregate, a Material Adverse
Effect and (f) has all necessary Permits from or by, has made all necessary
filings with, and has given all necessary notices to, each Governmental
Authority having jurisdiction, to the extent required for such ownership, lease,
sublease, operation, occupation or conduct of business, except where the failure
to obtain such Permits, make such filings or give such notices could not
reasonably be expected to have, either individually or in the aggregate, a
Material Adverse Effect.
Section 4.2 Loan and Related Documents. (a) Power and Authority. The
execution, delivery and performance by each Loan Party of the Loan Documents and
Related Documents to which it is a party and the consummation by each Loan Party
of the Related Transactions and other transactions contemplated therein (i) are
within such Loan Party's corporate or similar powers and, at the time of
execution thereof, have been duly authorized by all necessary corporate and
similar action (including, if applicable, consent of holders of its Securities),
(ii) do not (A) contravene such Loan Party's Constituent Documents, (B) violate
any Requirement of Law, (C) conflict with, contravene, constitute a default or
breach under, any material Contractual Obligation of any Loan Party or any of
its Subsidiaries, other than those which could not reasonably be expected to
have either individually or in the aggregate, a Material Adverse Effect, or (D)
result in the imposition of any Lien (other than a Permitted Lien) upon any
property of any Loan Party or any of its Subsidiaries and (iii) do not require
any Loan Party to obtain any Permit of, or make any filing with, any
Governmental Authority or obtain any consent of, or notice to, any Person, other
than (A) with respect to the Loan Documents, the filings required to perfect the
Liens created by the Loan Documents, (B) those listed on Schedule 4.2, which
unless otherwise noted on such schedule, have been or will otherwise be prior to
the Closing Date, obtained or made, copies of which (other than those so noted
as not yet obtained or made) have been, or will be prior to the Closing Date,
delivered to the Administrative Agent to the extent requested by the
Administrative Agent, and which (other than those so noted as not yet obtained
or made) on the Closing Date will be in full force and effect, and (C) in the
case of any Related Document, those which, if not obtained or made, could not,
reasonably be expected to have either individually or in the aggregate, a
Material Adverse Effect.
49
(b) Due Execution and Delivery. From and after its delivery to the
Administrative Agent, each Loan Document and Related Document has been duly
executed and delivered to the other parties thereto by each Loan Party, is the
legal, valid and binding obligation of such Loan Party and is enforceable
against such Loan Party in accordance with its terms, except as may be limited
by applicable bankruptcy, insolvency, reorganization, moratorium, fraudulent
transfer or other similar laws affecting creditors' rights generally or by
general equitable principles relating to enforceability.
(c) Related Documents. As of the Closing Date, all applicable waiting
periods in connection with the Acquisition have expired or have been terminated
without any action being taken by any Governmental Authority (including any
requisite waiting period (and any extension thereof) under the Xxxx-Xxxxx-Xxxxxx
Antitrust Improvements Act of 1976).
(d) Convertible Subordinated Notes. The Obligations constitute "Senior
Indebtedness" and "Designated Senior Indebtedness" under and as defined in the
Subordinated Convertible Notes Indenture. No other Indebtedness of any Group
Member qualifies as "Designated Senior Indebtedness" under the Subordinated
Convertible Notes Indenture, other than Indebtedness under the First Lien Loan
Documents.
Section 4.3 Ownership of Group Member. (a) Set forth on Schedule
4.3(a) is a complete and accurate list showing, as of the Closing Date, for each
Group Member (other than Holdings) and each Subsidiary of any Group Member and
each joint venture of any of them, its jurisdiction of organization, and the
number (in the case of the Loan Parties and any Excluded Foreign Subsidiary that
is a first tier Subsidiary of any Loan Party) and percentage of the outstanding
shares of each class of Stock owned (directly or indirectly) by the applicable
holder thereof. As of the Closing Date, all outstanding Stock owned by any Group
Member in each such Group Member, Subsidiary or joint venture has been validly
issued, is fully paid and non-assessable (to the extent applicable) and, except
in the case of Holdings, is owned beneficially and of record by a Group Member
(or, in the case of the Borrower, by Holdings) free and clear of all Liens other
than the security interests created by the Loan Documents and, in the case of
joint ventures, Permitted Liens. Except as set forth on Schedule 4.3(a), as of
the Closing Date, there are no Stock Equivalents with respect to the Stock of
any Group Member (other than Holdings) or any Contractual Obligations to which
any Group Member (other than Holdings) is a party with respect to (including any
restriction on) the issuance, voting, Sale or pledge of any Stock or Stock
Equivalent of any Group Member (other than Holdings).
(b) Set forth on Schedule 4.3(b) is a complete and accurate list, as
of the Closing Date, of all material agreements and documents relating to the
P&G Joint Venture and the Borrower has delivered to Administrative Agent a
complete copy of each such agreement and document and all material amendments,
waivers and other side letters or agreements affecting the terms thereof or
relating thereto.
(c) None of the Inactive Subsidiaries as of the Closing Date engage in
any business, operations or activity, or hold any property, other than as
permitted under Section 8.8(e).
Section 4.4 Financial Statements. (a) Each of (i) the audited
Consolidated balance sheet of Holdings as at December 31, 2006 and the related
Consolidated statements of income, retained earnings and cash flows of Holdings
for the Fiscal Year then ended, certified by BDO Xxxxxxx, LLP, and (ii) subject
to the absence of footnote disclosure and normal year-end
50
audit adjustments, the unaudited Consolidated balance sheets of Holdings as at
March 31, 2007 and the related Consolidated statements of income, retained
earnings and cash flows of Holdings for the three months then ended, copies of
each of which have been furnished to the Administrative Agent, fairly present in
all material respects the Consolidated financial position, results of operations
and cash flow of Holdings as at the dates indicated and for the periods
indicated in accordance with GAAP. To the knowledge of Holdings, each of (i) the
audited Consolidated balance sheet of Target as at December 31, 2006 and the
related Consolidated statements of income, retained earnings and cash flows of
Target for the Fiscal Year then ended, certified by Ernst & Young LLP, and (ii)
subject to the absence of footnote disclosure and normal year-end audit
adjustments, the unaudited Consolidated balance sheets of Target as at March 31,
2007 and the related Consolidated statements of income, retained earnings and
cash flows of Target for the three months then ended, copies of each of which
have been furnished to the Administrative Agent, fairly present in all material
respects the Consolidated financial position, results of operations and cash
flow of Target as at the dates indicated and for the periods indicated in
accordance with GAAP.
(b) Prior to the Closing Date, AcquisitionCo had no property,
liabilities or Contractual Obligations other than the Loan Documents and the
Related Documents and AcquisitionCo had no Subsidiary. On the Closing Date, and
to the knowledge of Holdings with respect to Target and its Subsidiaries, except
as set forth on Schedule 4.4(b), (i) no Group Member has any material liability
or other obligation (including Indebtedness, Guaranty Obligations, contingent
liabilities and liabilities for taxes, long-term leases and unusual forward or
long-term commitments) that is not reflected in the Financial Statements
referred to in clause (a) above or in the notes thereto, that has not been
publicly disclosed in any SEC filing of Holdings or the Target, and that is
prohibited by this Agreement and (ii) excluding with respect to Target and its
Subsidiaries prior to the Merger, other than in connection with the P&G Joint
Venture, since the date of the unaudited Financial Statements referenced in
clause (a) above, there has been no Sale of any material property of any Group
Member and no purchase or other acquisition of any material property that has
not be disclosed to the public or to the Administrative Agent.
(c) The Initial Projections have been prepared by Holdings in light of
the past operations of the business of Holdings, the Target and their respective
Subsidiaries and reflect projections for the Fiscal Years ending in 2007 through
2013. As of the Closing Date, the Initial Projections are based upon estimates
and assumptions stated therein, all of which Holdings believes to be reasonable
and fair in light of conditions and facts known to Holdings as of the Closing
Date and reflect the good faith estimates by Holdings of the future Consolidated
financial performance of Holdings and the other information projected therein
for the periods set forth therein; provided that (i) such Initial Projections
are forward looking information which may be subject to significant
uncertainties and contingencies beyond the Group Members' control, (ii) no
assurance would be given by the Group Members that such Initial Projections will
be realized and (iii) the actual results may differ from the Initial Projections
and such differences might be material.
(d) The pro forma consolidated balance sheet and related pro forma
consolidated statements of income and other pro forma information in conformity
with Regulation S-X of Holdings as of and for the twelve-month period ending
March 31, 2007 (the "Pro Forma Financial Statements") delivered to the
Administrative Agent prior to the date hereof have been prepared after giving
effect to the Related Transactions, the P&G Joint Venture and the
51
other transactions contemplated herein as if the Related Transactions, the P&G
Joint Venture and the other transactions contemplated herein had occurred as of
such date (in the case of such balance sheet) or at the beginning of such period
(in the case of such other financial statements), in each case which financial
statements shall have been prepared in a manner which is not materially
inconsistent with the financial statements or forecasts previously provided to
the Administrative Agent the assumptions expressed therein are believed by
Holdings to be reasonable based on the information available to Holdings at such
date and on the Closing Date.
Section 4.5 Material Adverse Effect. Since December 31, 2006, there
have been no events, circumstances, developments or other changes in facts that
could reasonably be expected, either individually or in the aggregate, to have a
Material Adverse Effect.
Section 4.6 Solvency. Both before and after giving effect to (a) the
Loans made on or prior to the date this representation and warranty is made, (b)
the disbursement of the proceeds of such Loans, (c) the consummation of the
Related Transactions and (d) the payment and accrual of all transaction costs in
connection with the foregoing, Holdings and its Subsidiaries taken as a group on
a consolidated basis are Solvent.
Section 4.7 Litigation. Except as set forth in Schedule 4.7, there are
no pending (or, to the knowledge of any Group Member, threatened) actions,
investigations, suits, proceedings, audits, claims, demands, orders or disputes
affecting the Borrower or any of its Subsidiaries with, by or before any
Governmental Authority other than those that cannot reasonably be expected
individually or in the aggregate, to have a Material Adverse Effect. No
injunction, writ, temporary restraining order or any order of any nature has
been issued by any court or other Governmental Authority purporting to enjoin or
restrain the execution, delivery or performance of this Agreement, any other
Loan Document or any Related Document, or directing that the transactions
provided for herein or therein not be consummated as herein or therein provided.
Section 4.8 Taxes. Except, in the case of each of clauses (i), (ii)
and (iii), as set forth in Schedule 4.8 or as could not reasonably be expected
to have a Material Adverse Effect: (i) all federal, state, local and foreign
income and franchise and other material tax returns, reports and statements
(collectively, the "Tax Returns") required to be filed by any Tax Affiliate have
been filed with the appropriate Governmental Authorities in all jurisdictions in
which such Tax Returns are required to be filed, all such Tax Returns are true
and correct in all material respects, and all taxes, charges and other
impositions reflected therein or otherwise due and payable have been paid prior
to the date on which any Liability may be added thereto for non-payment thereof
except for those contested in good faith by appropriate proceedings diligently
conducted and for which adequate reserves are maintained on the books of the
appropriate Tax Affiliate in accordance with GAAP; (ii) no Tax Return is under
audit or examination by any Governmental Authority and no notice of such an
audit or examination or any assertion of any claim for Taxes has been given or
made by any Governmental Authority; and (iii) no Tax Affiliate has participated
in a "reportable transaction" within the meaning of Treasury Regulation Section
1.6011-4(b) or has been a member of an affiliated, combined or unitary group
other than the group of which a Tax Affiliate is the common parent.
Section 4.9 Margin Regulations. The Borrower is not engaged in the
business of extending credit for the purpose of, and no proceeds of any Loan or
other extensions of credit hereunder will be used for the purpose of, buying or
carrying margin stock (within the meaning of Regulation U of the Federal Reserve
Board) or extending credit to others for the
52
purpose of purchasing or carrying any such margin stock, in each case in
contravention of Regulation T, U or X of the Federal Reserve Board.
Section 4.10 No Burdensome Obligations; No Defaults. No Group Member
is a party to any Contractual Obligation, no Group Member has Constituent
Documents containing obligations, and, to the knowledge of any Group Member,
there are no applicable Requirements of Law (including all Healthcare Laws), in
each case the compliance with which could reasonably be expected to have, in the
aggregate, a Material Adverse Effect. No Group Member (and, to the knowledge of
each Group Member, no other party thereto) is in default under or with respect
to any Contractual Obligation of any Group Member, other than those that could
not reasonably be expected to have, either individually or in the aggregate, a
Material Adverse Effect.
Section 4.11 Investment Company Act. No Group Member is an "investment
company" or an "affiliated person" of, or "promoter" or "principal underwriter"
for, an "investment company", as such terms are defined in the Investment
Company Act of 1940.
Section 4.12 Labor Matters. (a) Except as set forth on Schedule 4.12,
there are no strikes, work stoppages, slowdowns or lockouts existing, pending
(or, to the knowledge of any Group Member, threatened) against or involving any
Group Member, except, for those that could not reasonably be expected to have,
either individually or in the aggregate, a Material Adverse Effect; (b) hours
worked by and payment made to employees of each Group Member comply with the
Fair Labor Standards Act and each other federal, state, local or foreign law
applicable to such matters, except where the failures to so comply would not
constitute, in the aggregate, a Material Adverse Effect; (c) as of the Closing
Date, no Loan Party is party to or bound by any collective bargaining or similar
agreement with any union, labor organization, works council or similar
representative covering any employee of any Loan Party; (d) as of the Closing
Date, no Group Member which is not Loan Party is party to or bound by any
collective bargaining or similar agreement with any union, labor organization,
works council or similar representative covering any employee of any such Group
Member, except, for those that could not reasonably be expected to have, either
individually or in the aggregate, a Material Adverse Effect; (e) as of the
Closing Date, there is no organizing activity involving any Group Member pending
or, to any Group Member's knowledge, threatened by any labor union or group of
employees, except, for those that could not reasonably be expected to have,
either individually or in the aggregate, a Material Adverse Effect; (f) as of
the Closing Date, no petition for certification or election of any such
representative is existing or pending with respect to any employee of any Group
Member and no such representative has sought certification or recognition with
respect to any employee of any Group Member, except, for those that could not
reasonably be expected to have, either individually or in the aggregate, a
Material Adverse Effect; and (g) there are no complaints or charges against any
Group Member pending or, to the knowledge of any Group Member, threatened to be
filed with any Governmental Authority or arbitrator based on, arising out of, in
connection with, or otherwise relating to the employment or termination of
employment by any Group Member of any individual except for complaints or
charges that, in the aggregate, would not constitute a Material Adverse Effect.
Section 4.13 ERISA.
(a) Schedule 4.13(a) sets forth, as of the Closing Date, a complete
and correct list of, and that separately identifies, (a) all Title IV Plans, (b)
all Multiemployer Plans and (c) all material Benefit Plans of the Loan Parties.
Each Benefit Plan, and each trust thereunder, intended to qualify for tax exempt
status under Section 401 or 501 of the Code or
53
other Requirements of Law so qualifies except where such noncompliance would
not, in the aggregate, constitute a Material Adverse Effect. Each Benefit Plan
is in compliance with applicable provisions of ERISA, the Code and other
Requirements of Law, except where such noncompliance would not, in the
aggregate, constitute a Material Adverse Effect. No Group Member or any ERISA
Affiliate has engaged in any "prohibited transactions" as defined in Section 406
of ERISA and Section 4975 of the Code, in connection with any Benefit Plan, that
would subject any Group Member to a tax on prohibited transactions imposed by
Section 502(i) of ERISA or Section 4975 of the Code that would constitute a
Material Adverse Effect. On the Closing Date, no ERISA Event has occurred in
connection with which obligations and liabilities (contingent or otherwise)
remain outstanding.
(b) Except as set forth in Schedule 4.13(b), (i) no Title IV Plan has
any Unfunded Pension Liability that could result in a Material Adverse Effect;
(ii) there are no existing or pending (or to the knowledge of any Group Member,
threatened) claims (other than routine claims for benefits in the normal
course), sanctions, actions, lawsuits or other proceedings or investigation
involving any Benefit Plan that would result in a Material Adverse Effect; (iii)
within the last five years no Title IV Plan of any Group Member or ERISA
Affiliate has been terminated, other than in a "standard termination" as that
term is used in Section 4041(b)(1) of ERISA; and (iv) no ERISA Event has
occurred that, individually or in the aggregate, could result in a Material
Adverse Effect or a Lien under ERISA or Code Sections 412 or 430.
Section 4.14 Environmental Matters. Except, in the case of each of
clauses (a), (b), (c) and (d), as set forth on Schedule 4.14 or as could not,
individually or in the aggregate, reasonably be expected to have a Material
Adverse Effect, (a) the operations of each Group Member are and have been in
compliance with all applicable Environmental Laws, including obtaining,
maintaining and complying with all Permits required by any applicable
Environmental Law, (b) no Group Member is party to, and no Group Member and no
real property currently (or to the knowledge of any Group Member previously)
owned, leased, subleased, operated or otherwise occupied by or for any Group
Member is subject to or the subject of, any Contractual Obligation or any
pending (or, to the knowledge of any Group Member, threatened) order, action,
investigation, suit, proceeding, audit, claim, demand, dispute or notice of
violation or of potential liability or similar notice under or pursuant to any
Environmental Law, (c) no Lien in favor of any Governmental Authority securing,
in whole or in part, Environmental Liabilities has attached to any property of
any Group Member and, to the knowledge of any Group Member, no facts,
circumstances or conditions exist that could reasonably be expected to result in
any such Lien attaching to any such property, and (d) no Group Member has caused
or suffered to occur a Release of Hazardous Materials at, to or from any real
property of any Group Member and each such real property is free of
contamination by any Hazardous Materials.
Section 4.15 Intellectual Property. Each Group Member owns or licenses
or otherwise has the right to use all Intellectual Property that is necessary
for the operations of its businesses in all material respects. To the knowledge
of each Group Member, (a) the conduct and operations of the businesses of each
Group Member does not infringe, misappropriate, violate or otherwise impair any
Intellectual Property owned by any other Person and (b) no other Person has
contested any right, title or interest of any Group Member in, or relating to,
any Intellectual Property owned by such Group Member, other than, in the case of
each of clauses (a) and (b), as could not reasonably be expected to have, either
individually or in the aggregate, a Material Adverse Effect. In addition,
except, in the case of each of clauses (x), (y) and (z), as set forth in
Schedule 4.15 or as could not reasonably be expected to have, either
individually or in the
54
aggregate, a Material Adverse Effect (x) there are no pending (or, to the
knowledge of any Group Member, threatened) actions, suits, proceedings, audits,
claims, demands, orders or disputes affecting any Group Member with respect to,
(y) no judgment or order regarding any such claim has been rendered by any
competent Governmental Authority, and no settlement agreement or similar
Contractual Obligation has been entered into by any Group Member with respect
thereto, and (z) no Group Member knows or has any reason to know of any valid
basis for any claim based on, any such infringement, misappropriation, violation
or impairment.
Section 4.16 Title; Real Property. (a) Each Group Member has good and
marketable fee simple title to all owned real property and valid leasehold
interests in all leased real property, and owns all personal property, in each
case that is purported to be owned or leased by it, including those reflected on
the most recent Financial Statements delivered by the Borrower, and none of such
property is subject to any Lien except Permitted Liens.
(b) Set forth on Schedule 4.16 is, as of the Closing Date, (i) a
complete and accurate list of all real property owned in fee simple by any Group
Member and (ii) for each such owned real property that the Administrative Agent
has requested be subject to a Mortgage or that is otherwise material to the
business of any Group Member, each Contractual Obligation by any Group Member,
whether contingent or otherwise, to Sell such real property.
Section 4.17 Bank and Security Accounts. Set forth on Schedule 4.17
is, as of the Closing Date, a complete and accurate list of all bank, deposit,
securities, commodities or other accounts maintained by any Loan Party, and such
Schedule correctly identifies the name of each depository, the name in which the
account is held, a description of the purpose of the account, and the complete
account number therefor.
Section 4.18 Insurance. Set forth on Schedule 4.18 is, as of the
Closing Date, a complete and accurate, in all material respects, list of all
insurance policies of any nature maintained by each Loan Party, as well as a
summary of the key business terms of each such policy such as deductibles,
coverage limits and term of policy.
Section 4.19 Delivery of Related Documents. The Borrower has delivered
to Administrative Agent a correct and complete copy of each Related Document,
and all other material documents, instruments and agreements executed in
connection therewith (including all material exhibits, schedules and disclosure
letters referred to therein or delivered pursuant thereto, if any) and all
material amendments thereto, material waivers relating thereto and other
material side letters or agreements affecting the terms thereof. None of such
documents and agreements has been amended or supplemented, nor have any of the
provisions thereof been waived in any material respect, except pursuant to a
written agreement or instrument that has heretofore been delivered to
Administrative Agent.
Section 4.20 Full Disclosure. The information prepared or furnished by
or on behalf of any Group Member to the Administrative Agent or any Lender in
connection with any Loan Document or Related Document (including the information
contained in any Financial Statement or Disclosure Document) or the consummation
of any Related Transaction or any other transaction contemplated therein, taken
together with all other such information, does not contain any untrue statement
of a material fact or omit to state a material fact necessary to make the
statements contained therein, in light of the circumstances when made, not
misleading; provided, however, (i) the projections contained therein (including
all Projections) are forward looking information which may be subject to
significant uncertainties and contingencies beyond the
55
Group Members' control, (ii) no assurance would be given by the Group Members
that such projections will be realized and (iii) the actual results may differ
from such projections and such differences might be material. All projections
that are part of such information (including those set forth in any Projections
delivered subsequent to the Closing Date) are based upon estimates and
assumptions stated therein believed to be reasonable and fair as of the date
made in light of conditions and facts then known and, as of such date, reflect
good faith estimates of the information projected for the periods set forth
therein.
Section 4.21 Patriot Act. No Group Member (and, to the knowledge of
each Group Member, no joint venture or subsidiary thereof) is in violation in
any material respects of any United States Requirements of Law relating to
terrorism, sanctions or money laundering, including the United States Executive
Order No. 13224 on Terrorist Financing and the Patriot Act.
ARTICLE V
FINANCIAL COVENANTS
Each of Holdings and the Borrower (and, to the extent set forth in any
other Loan Document, each other Loan Party) agrees with the Lenders and the
Administrative Agent to each of the following, as long as any Obligation or any
Commitment remains outstanding:
Section 5.1 Maximum Consolidated Leverage Ratio. Holdings shall not
have, on the last day of each Fiscal Quarter set forth below, a Consolidated
Leverage Ratio greater than the maximum ratio set forth opposite such Fiscal
Quarter:
FISCAL QUARTER ENDING MAXIMUM CONSOLIDATED LEVERAGE RATIO
--------------------- -----------------------------------
SEPTEMBER 30, 2007 8.75 TO 1
DECEMBER 31, 2007 8.75 TO 1
MARCH 31, 2008 8.50 TO 1
JUNE 30, 2008 8.50 TO 1
SEPTEMBER 30, 2008 8.25 TO 1
DECEMBER 31, 2008 8.00 TO 1
MARCH 31, 2009 8.00 TO 1
JUNE 30, 2009 7.75 TO 1
SEPTEMBER 30, 2009 7.75 TO 1
DECEMBER 31, 2009 7.50 TO 1
MARCH 31, 2010 7.50 TO 1
JUNE 30, 2010 7.25 TO 1
SEPTEMBER 30, 2010 7.25 TO 1
DECEMBER 31, 2010 7.00 TO 1
MARCH 31, 2011 7.00 TO 1
JUNE 30, 2011 6.75 TO 1
56
SEPTEMBER 30, 2011 6.75 TO 1
DECEMBER 31, 2011 6.50 TO 1
MARCH 31, 2012 6.50 TO 1
JUNE 31, 2012 6.25 TO 1
SEPTEMBER 30, 2012 6.25 TO 1
DECEMBER 31, 2012 6.00 TO 1
MARCH 31, 2013 6.00 TO 1
JUNE 31, 2013 6.00 TO 1
SEPTEMBER 30, 2013 6.00 TO 1
DECEMBER 31, 2013 6.00 TO 1
MARCH 31, 2014 AND EACH FISCAL QUARTER THEREAFTER 5.75 TO 1
; provided that the maximum ratios set forth above shall be reduced by 0.75 to 1
for each Fiscal Quarter which begins after the date on which the Cholestech
Acquisition is consummated.
Section 5.2 [Intentionally Omitted].
Section 5.3 Capital Expenditures. No Group Member shall incur, or
permit to be incurred, Capital Expenditures in the aggregate during any Fiscal
Year, commencing with the Fiscal Year ending December 31, 2007, in excess of
2.9% of Total Assets as of the end of the immediately preceding Fiscal Year.
ARTICLE VI
REPORTING COVENANTS
Each of Holdings and the Borrower (and, to the extent set forth in any
other Loan Document, each other Loan Party) agrees with the Lenders and the
Administrative Agent to each of the following, as long as any Obligation or any
Term Loan Commitment remains outstanding:
Section 6.1 Financial Statements. The Borrower shall deliver to the
Administrative Agent each of the following:
(a) Quarterly Reports. As soon as available, and in any event within
45 days after the end of each of the first three Fiscal Quarters of each Fiscal
Year, the Consolidated unaudited balance sheet of Holdings as of the close of
such Fiscal Quarter and related Consolidated statements of income and cash flow
for such Fiscal Quarter and that portion of the Fiscal Year ending as of the
close of such Fiscal Quarter, setting forth in comparative form the figures for
the corresponding period in the prior Fiscal Year and the figures contained in
the latest Projections, in each case certified by a Responsible Officer of
Holdings as fairly presenting in all material respects the Consolidated
financial position, results of operations and cash flow of Holdings as at the
dates indicated and for the periods indicated in accordance with GAAP (subject
to the absence of footnote disclosure and normal year-end audit adjustments).
57
(b) Annual Reports. As soon as available, and in any event within 90
days after the end of each Fiscal Year, the Consolidated balance sheet of
Holdings as of the end of such year and related Consolidated statements of
income, stockholders' equity and cash flow for such Fiscal Year, each prepared
in accordance with GAAP, together with a certification by the Group Members'
Accountants that such Consolidated Financial Statements fairly present in all
material respects the Consolidated financial position, results of operations and
cash flow of Holdings as at the dates indicated and for the periods indicated
therein in accordance with GAAP without qualification as to the scope of the
audit or as to going concern and without any other similar qualification.
(c) Compliance Certificate. Together with each delivery of any
Financial Statement pursuant to clause (a) or (b) above, a Compliance
Certificate duly executed by a Responsible Officer of Holdings that, among other
things, (i) demonstrates compliance with each financial covenant contained in
Article V that is tested at least on a quarterly basis, (ii) if delivered
together with any Financial Statement pursuant to clause (b) above, shows in
reasonable detail the calculations used in determining Excess Cash Flow, and
(iii) states that no Default is continuing as of the date of delivery of such
Compliance Certificate or, if a Default is continuing, states the nature thereof
and the action that Holdings proposes to take with respect thereto.
(d) Corporate Chart. Together with delivery of any Financial Statement
pursuant to clause (b) above, each in form and substance satisfactory to the
Administrative Agent, a certificate by a Responsible Officer of Holdings that
the Corporate Chart attached thereto (or the last Corporate Chart delivered
pursuant to this clause (d)) is correct and complete as of the date of such
Compliance Certificate.
(e) Additional Projections. As soon as available and in any event not
later than 30 days after the end of each Fiscal Year, any significant revisions
to, (i) the annual business plan of the Group Members for the Fiscal Year next
succeeding such Fiscal Year and (ii) a forecast prepared by management of
Holdings for each Fiscal Quarter in such next succeeding Fiscal Year, including
in such forecast (x) a projected year-end Consolidated balance sheet, income
statement and statement of cash flows, (y) a statement of all of the material
assumptions on which such forecasts are based and (z) substantially the same
type of financial information as that contained in the Initial Projections.
(f) Management Discussion and Analysis. To the extent not included in
Holdings' public filings, together with each delivery of any Financial Statement
pursuant to clause (a) or (b) above, a discussion and analysis of the financial
condition and results of operations of the Group Members for the portion of the
Fiscal Year then elapsed and discussing the reasons for any significant
variations from the Projections for such period and the figures for the
corresponding period in the previous Fiscal Year.
(g) Intercompany Loan Balances. Together with each delivery of any
Financial Statements pursuant to clause (b) above, a summary of the outstanding
balances of all intercompany Indebtedness as of the last day of the Fiscal Year
covered by such Financial Statement, certified as complete and correct by a
Responsible Officer of Holdings as part of the Compliance Certificate delivered
in connection with such Financial Statements.
(h) Audit Reports, Management Letters, Etc. Together with each
delivery of any Financial Statements for any Fiscal Year pursuant to clause (b)
above, copies of each management letter, audit report or similar letter or
report received by any Group Member from
58
any independent registered certified public accountant (including the Group
Members' Accountants) in connection with such Financial Statements or any audit
thereof, each certified to be complete and correct copies by a Responsible
Officer of Holdings as part of the Compliance Certificate delivered in
connection with such Financial Statements.
(i) Insurance. Together with each delivery of any Financial Statements
for any Fiscal Year pursuant to clause (b) above, each in form and substance
satisfactory to the Administrative Agent and certified as complete and correct
by a Responsible Officer of Holdings as part of the Compliance Certificate
delivered in connection with such Financial Statements, a summary of all
material insurance coverage maintained as of the date thereof by any Group
Member, together with such other related documents and information as the
Administrative Agent may reasonably require.
(j) Correspondence with Holders of the Subordinated Debt. Promptly
following the delivery thereof to the holders of the Subordinated Debt, a copy
of all correspondence and reports sent by Holdings to the holders of the
Subordinated Debt.
(k) Amendments to Related Documents and the Cholestech Acquisition
Agreement. As soon as available, copies of substantially final drafts of any
proposed material amendment, supplement, waiver or other modification with
respect to any Related Document or the Cholestech Acquisition Agreement.
Section 6.2 Other Events. The Borrower shall give the Administrative
Agent notice of each of the following (which may be made by telephone if
promptly confirmed in writing) promptly after any Responsible Officer of any
Group Member knows or has reason to know of it: (a) any Default or Event of
Default (including any default or event of default under the First Lien Loan
Documents), (b) any event (other than any event involving loss or damage to
property) reasonably expected to result in a mandatory payment of the
Obligations pursuant to Section 2.8, stating the material terms and conditions
of such transaction and estimating the Net Cash Proceeds thereof, (c) the
commencement of, or any material adverse developments in, any action,
investigation, suit, proceeding, audit, claim, demand, order or dispute with, by
or before any Governmental Authority affecting any Group Member or any property
of any Group Member that (i) seeks material injunctive or similar relief against
any Group Members that could reasonably be expected to have a Material Adverse
Effect, (ii) in the reasonable judgment of the Borrower, exposes any Group
Member to liability in an aggregate amount in excess of $5,750,000 or (iii) has
a reasonable possibility of being determined adversely to any Group Member and
if so adversely determined could reasonably be expected to have, either
individually or in the aggregate, a Material Adverse Effect and (d) the
acquisition of any material real property by any Loan Party.
Section 6.3 Copies of Notices and Reports. The Borrower shall promptly
deliver to the Administrative Agent copies of each of the following: (a) except
to the extent publicly filed, all reports that Holdings transmits to its
security holders generally, and (b) except to the extent publicly filed, all
material documents that any Group Member files with the Securities and Exchange
Commission, the National Association of Securities Dealers, Inc., any securities
exchange or any Governmental Authority exercising similar functions.
Section 6.4 Taxes. The Borrower shall give the Administrative Agent
notice (which may be made by telephone if promptly confirmed in writing) of the
creation of any
59
Contractual Obligation of any Tax Affiliate, or the receipt of any request
directed to any Tax Affiliate, to make any adjustment under Section 481(a) of
the Code, by reason of a change in accounting method or otherwise, which in each
of the foregoing cases could reasonably be expected to have, either individually
or in the aggregate, a Material Adverse Effect promptly after any Reasonable
Officer of any Group Member knows or has reason to know of it.
Section 6.5 Labor Matters. The Borrower shall give the Administrative
Agent notice of each of the following (which may be made by telephone if
promptly confirmed in writing), promptly after, and in any event within 30 days
after any Responsible Officer of any Group Member obtains knowledge of: (a) the
commencement of any material labor dispute to which any Group Member is or may
become a party, including any strikes, lockouts or other disputes relating to
any of such Person's plants and other facilities and (b) the incurrence by any
Group Member of any Worker Adjustment and Retraining Notification Act or related
or similar liability incurred with respect to the closing of any plant or other
facility of any such Person (other than, in the case of this clause (b), those
that would not, in the aggregate, have a Material Adverse Effect).
Section 6.6 ERISA Matters. The Borrower shall give the Administrative
Agent (a) on or prior to any filing by any ERISA Affiliate of any notice of
intent to terminate any Title IV Plan, a copy of such notice and (b) promptly,
and in any event within 10 days, after any Responsible Officer of any ERISA
Affiliate knows or has reason to know thereof that (i) a request for a minimum
funding waiver under Section 412 of the Code has been filed with respect to any
Title IV Plan or Multiemployer Plan, a notice (which may be made by telephone if
promptly confirmed in writing) describing such waiver request and any action
that any ERISA Affiliate proposes to take with respect thereto, together with a
copy of any notice filed with the PBGC or the IRS pertaining thereto or (ii) any
ERISA Event, together with a statement of the Responsible Officer setting forth
the details of such ERISA Event and the action which the ERISA Affiliates
propose to take with respect thereto.
Section 6.7 Environmental Matters. The Borrower shall provide the
Administrative Agent notice of each of the following (which may be made by
telephone if promptly confirmed in writing) promptly after any Responsible
Officer of any Group Member obtains knowledge of (and, upon reasonable request
of the Administrative Agent, documents and information in connection therewith):
(i)(A) unpermitted Releases, or (B) the receipt by any Group Member of any
notice of violation of or potential liability or similar notice under, or the
existence of any condition that could reasonably be expected to result in
violations of or liabilities under, any Environmental Law, or (C) the
commencement of, or any material change to, any action, investigation, suit,
proceeding, audit, claim, demand, dispute alleging a violation of or liability
under any Environmental Law, that, for each of clauses (A), (B) and (C) above
(and, in the case of clause (C), if adversely determined), in the aggregate for
each such clause, could reasonably be expected to have, either individually or
in the aggregate, a Material Adverse Effect, and (ii) the receipt by any Group
Member of notification that any property of any Group Member is subject to any
Lien in favor of any Governmental Authority securing, in whole or in part,
Environmental Liabilities that could reasonably be expected to have, either
individually or in the aggregate, a Material Adverse Effect.
Section 6.8 Other Information. The Borrower shall provide the
Administrative Agent with such other documents and information with respect to
the business, property, condition (financial or otherwise), legal, financial or
corporate or similar affairs or
60
operations (including tax and environmental matters) of any Group Member as the
Administrative Agent or any Lender through the Administrative Agent may from
time to time reasonably request
Section 6.9 Delivery of Information to Lenders. The Administrative
Agent shall provide to each Lender copies of all documents and information
delivered by the Borrower to the Administrative Agent pursuant to this Article
VI upon delivery of such documents and information to the Administrative Agent
(it being understood that the foregoing is the obligation of the Administrative
Agent and not the obligation of Holdings or the Borrower).
ARTICLE VII
AFFIRMATIVE COVENANTS
Each of Holdings and the Borrower (and, to the extent set forth in any
other Loan Document, each other Loan Party) agrees with the Lenders and the
Administrative Agent to each of the following, as long as any Obligation or any
Commitment remains outstanding:
Section 7.1 Maintenance of Corporate Existence. Each Group Member
shall (a) preserve and maintain its legal existence, except in the consummation
of transactions expressly permitted by Sections 8.4 and 8.7, and (b) preserve
and maintain its rights (charter and statutory), privileges franchises and
Permits necessary or desirable in the conduct of its business, except, in the
case of this clause (b), where the failure to do so would not, in the aggregate,
have a Material Adverse Effect.
Section 7.2 Compliance with Laws, Etc. Each Group Member shall comply
with all applicable Requirements of Law (including all Healthcare Laws),
Contractual Obligations and Permits, except for such failures to comply that
would not, in the aggregate, have a Material Adverse Effect.
Section 7.3 Payment of Obligations. Each Group Member shall pay or
discharge before they become delinquent (a) all material claims, taxes,
assessments, charges and levies imposed by any Governmental Authority and (b)
all other lawful claims that if unpaid would, by the operation of applicable
Requirements of Law, become a Lien upon any property of any Group Member,
except, in the case of each of clauses (a) and (b), for those whose amount or
validity is being contested in good faith by proper proceedings diligently
conducted and for which adequate reserves are maintained on the books of the
appropriate Group Member in accordance with GAAP.
Section 7.4 Maintenance of Property. Each Group Member shall maintain
and preserve (a) in good working order and condition all of its property
necessary in the conduct of its business and (b) all rights, permits, licenses,
approvals and privileges (including all Permits and its registered Intellectual
Property) necessary, used or useful in the conduct of its business (whether for
the ownership, lease, sublease or other operation or occupation of property or
otherwise), and shall make all necessary or appropriate filings with, and give
all required notices to, Government Authorities, except for such failures to
maintain and preserve the items set forth in clauses (a) and (b) above that
would not, either individually or in the aggregate, have a Material Adverse
Effect. Each Group Member shall perform all obligations under any Contractual
Obligation to which such Loan Party or any of its Subsidiaries is bound, or to
which it or any of its properties is subject, including the Related Documents,
except where the failure to perform would not have, either individually or in
the aggregate, a Material Adverse Effect.
61
Section 7.5 Maintenance of Insurance. Each Group Member shall (a)
maintain or cause to be maintained in full force and effect all policies of
insurance of any kind with respect to the property and businesses of the Group
Members (including policies of life, fire, theft, product liability, public
liability, property damage, other casualty, employee fidelity, workers'
compensation, business interruption and employee health and welfare insurance)
with financially sound and reputable insurance companies or associations (in
each case that are not Affiliates of the Borrower) of a nature and providing
such coverage as is sufficient and as is customarily carried by businesses of
the size and character of the business of the Group Members and (b) cause all
such insurance relating to any property or business of any Loan Party to name
the Administrative Agent on behalf of the Secured Parties as additional insured
or loss payee, as appropriate (except in the case of director and officer
liability policies, employee fidelity policies, workers compensation policies,
employee health and welfare policies, kidnap and xxxxxx policies, theft
policies, terrorism or similar policies), and to provide that no cancellation,
material addition in amount or material change in coverage shall be effective
until after 30 days' notice thereof to the Administrative Agent.
Section 7.6 Keeping of Books. The Group Members shall keep proper
books of record and account, in which, in all material respects, full, true and
correct entries shall be made in accordance with GAAP and all other applicable
Requirements of Law of all financial transactions and the assets and business of
each Group Member.
Section 7.7 Access to Books and Property. Each Group Member shall
permit the Administrative Agent, the Lenders and any Related Person of any of
them, as often as reasonably requested, at any reasonable time during normal
business hours and with reasonable advance notice (except that, during the
continuance of an Event of Default, no such notice shall be required) to (a)
visit and inspect the property of each Group Member and examine and make copies
of and abstracts from, the corporate (and similar), financial, operating and
other books and records of each Group Member, (b) discuss the affairs, finances
and accounts of each Group Member with any officer or director of any Group
Member and (c) communicate directly with any registered certified public
accountants (including the Group Members' Accountants) of any Group Member. Each
Group Member shall authorize their respective registered certified public
accountants (including the Group Members' Accountants) to communicate directly
with the Administrative Agent, the Lenders and their Related Persons and to
disclose to the Administrative Agent, the Lenders and their Related Persons all
financial statements and other documents and information as they might have and
the Administrative Agent or any Lender reasonably requests with respect to any
Group Member. Without in any way limiting the foregoing, each Group Member, at
the request of the Administrative Agent or the Required Lenders, will
participate and cause key management personnel of such Group Member to
participate in a meeting with the Administrative Agent and the Lenders at least
once during each Fiscal Year.
Section 7.8 Environmental. Each Group Member shall comply with, and
maintain its real property, whether owned, leased, subleased or otherwise
operated or occupied, in compliance with, all applicable Environmental Laws
(including by implementing any Remedial Action necessary to achieve such
compliance or that is required by orders and directives of any Governmental
Authority) except for failures to comply that would not, either individually or
in the aggregate, have a Material Adverse Effect. Without limiting the
foregoing, if an Event of Default is continuing or if the Administrative Agent
at any time has a reasonable basis to believe that there exist violations of
Environmental Laws by any Group Member or that there exist any Environmental
Liabilities, in each case, that would have, either individually or in the
aggregate, a
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Material Adverse Effect, then each Group Member shall, promptly upon receipt of
request from the Administrative Agent, cause the performance of, and allow the
Administrative Agent and its Related Persons access to such real property for
the purpose of conducting, such environmental audits and assessments, including
subsurface sampling of soil and groundwater, and cause the preparation of such
reports, in each case as the Administrative Agent may from time to time
reasonably request. Such audits, assessments and reports, to the extent not
conducted by the Administrative Agent or any of its Related Persons, shall be
conducted and prepared by reputable environmental consulting firms reasonably
acceptable to the Administrative Agent and shall be in form and substance
reasonably acceptable to the Administrative Agent.
Section 7.9 Use of Proceeds. The proceeds of the Loans shall be used
by the Borrower (and, to the extent distributed, contributed or otherwise
transferred to them by the Borrower or any Group Member, each other Group
Member) solely (a) to consummate the Related Transactions and for the payment of
related transaction costs, fees and expenses, (b) for the payment of transaction
costs, fees and expenses incurred in connection with the Loan Documents and the
transactions contemplated therein and (c) for working capital and other general
corporate purposes, including Permitted Acquisitions; provided that (i) prior to
applying proceeds of the Term Loans to finance the Related Transactions on the
Closing Date, the Group Member Cash Payment shall first be applied to fund the
Related Transactions on the Closing Date (including the payment of related
transaction costs, fees and expenses), and (ii) if the Merger Funding Date does
not occur on the Closing Date, any remaining proceeds of the First Lien Term
Loans, any First Lien Revolving Loans made on the Closing Date (and any First
Lien Revolving Loans made after the Closing Date to the extent the Borrower
deposits or directs the deposit of such amounts in the Acquisition Cash
Collateral Account) and the Term Loans (the "Acquisition Cash Collateral Funds")
shall be deposited into the Acquisition Cash Collateral Account for application
in accordance with Section 2.19.
Section 7.10 Additional Collateral and Guaranties. To the extent not
delivered to the Administrative Agent on or before the Closing Date (including
in respect of after-acquired property and Persons that become Subsidiaries of
any Loan Party after the Closing Date) and except to the extent otherwise
expressly provided under Section 7.15, each Loan Party shall, promptly (and,
with respect to any Permitted Acquisition, within 30 days of the consummation
thereof or such longer period of time agreed to by the Administrative Agent), do
each of the following, unless otherwise agreed by the Administrative Agent:
(a) deliver to the Administrative Agent such modifications to the
terms of the Loan Documents (or, to the extent applicable as determined by the
Administrative Agent, such other documents), in each case in form and substance
reasonably satisfactory to the Administrative Agent and as the Administrative
Agent deems necessary or advisable in order to ensure the following:
(i) (A) each Subsidiary of any Loan Party shall guaranty, as
primary obligor and not as surety, the payment of the Obligations of the
Borrower on the terms set forth in the Guaranty and Security Agreement; and
(ii) each Loan Party (including any Person required to become a
Guarantor pursuant to clause (i) above) shall effectively grant to the
Administrative Agent, for the benefit of the Secured Parties, a valid and
enforceable security interest in all of its property, including all of its
Stock and Stock Equivalents and other Securities, as security for the
Obligations of such Loan Party (excluding any Excluded Property, as
63
defined in the Guaranty and Security Agreement) on the terms set forth in
the Guaranty and Security Agreement;
provided, however, that, unless the Borrower and the Administrative Agent
otherwise agree, in no event shall (w) prior to the Merger Funding Date, the
Target or any of its Subsidiaries be required to guaranty the payment of any
Obligation or grant a security interest on any of its property as security for
any Obligation, (x) any Excluded Foreign Subsidiary be required to guaranty the
payment of any Obligation, (y) the Loan Parties, individually or collectively,
be required to pledge in excess of 66% of the outstanding Voting Stock of any
Excluded Foreign Subsidiary (and subject to clause (z) hereafter) or (z) a
security interest be required to be granted on any property of any Excluded
Foreign Subsidiary as security for any Obligation;
(b) deliver to the Administrative Agent all documents representing all
Stock, Stock Equivalents, other Securities, chattel paper and instruments
pledged pursuant to the documents delivered pursuant to clause (a) above,
together with undated powers or endorsements duly executed in blank;
(c) upon request of the Administrative Agent, deliver to it a Mortgage
on any real property owned by any Loan Party having a fair market value in
excess of $10,000,000, together with all Mortgage Supporting Documents
reasonably requested by the Administrative Agent relating thereto (or, if such
real property is located in a jurisdiction outside the United States, similar
documents reasonably deemed appropriate by the Administrative Agent to obtain,
to the extent possible, the equivalent in such jurisdiction of a first-priority
mortgage on such real property);
(d) subject to the terms of the Guaranty and Security Agreement, take
all other actions necessary or advisable to ensure the validity or continuing
validity of any guaranty for any Obligation or any Lien securing any Obligation,
to perfect, maintain, evidence or enforce any Lien securing any Obligation or to
ensure such Lien has the same priority as that of the Liens on similar
Collateral set forth in the Loan Documents executed on the Closing Date (or, for
Collateral located outside the United States, a similar priority reasonably
acceptable to the Administrative Agent), including (x) the filing of UCC
financing statements in such jurisdictions as may be required by the Loan
Documents or applicable Requirements of Law or as the Administrative Agent may
otherwise reasonably request, and (y) with respect to the outstanding Voting
Stock of any Excluded Foreign Subsidiary required to be pledged hereunder (which
shall specifically exclude Orgenics Ltd. and Orgenics International Holdings,
B.V.), upon request of the Administrative Agent, pledge agreements and similar
documents deemed appropriate by the Administrative Agent to obtain and perfect a
security interest or the equivalent under the laws of the jurisdiction of
organization of such Excluded Foreign Subsidiary, in such Voting Stock; provided
that the documents required under this clause (y) (i) shall be required only
with respect to any Excluded Foreign Subsidiary which generates gross revenues
in any Fiscal Year of greater than $5,000,000, unless otherwise agreed to by the
Administrative Agent, and (ii) except as provided in the foregoing clause (i),
shall not be required with respect to any Excluded Foreign Subsidiaries which
generate gross revenues in any Fiscal Year of less than $20,000,000 in the
aggregate or such higher amount otherwise agreed to by the Administrative Agent;
(e) use commercially reasonable efforts to deliver to the
Administrative Agent a landlord's agreement or bailee letter, as applicable,
from the lessor of each leased property or bailee with respect to any warehouse,
processor or converter facility or other location where Collateral with a value
in excess of $1,000,000 is stored or located, unless otherwise
64
consented to by the Administrative Agent, which agreement or letter shall
contain a waiver or subordination of all Liens or claims that the landlord or
bailee may assert against the Collateral at that location, and shall otherwise
be reasonably satisfactory in form and substance to Administrative Agent; and
(f) deliver to the Administrative Agent and the Lenders legal opinions
relating to the matters described in this Section 7.10, which opinions shall be
as reasonably required by, and in form and substance and from counsel reasonably
satisfactory to, the Administrative Agent.
Section 7.11 Deposit Accounts; Securities Accounts and Cash Collateral
Accounts. (a) Each Loan Party shall, unless otherwise consented to by the
Administrative Agent and except to the extent otherwise expressly provided under
Section 7.10 or Section 7.15, (i) deposit all of its cash in deposit accounts
that are Controlled Deposit Accounts; provided, however, that each Group Member
may maintain zero-balance accounts for the purpose of managing local
disbursements and may maintain accounts for: (A) payroll, (B) payroll taxes, (C)
other employee wage and benefit payments for the benefit of the Group Members'
salaried employees, and (D) withholding tax and other fiduciary accounts, and
(ii) deposit all of its Cash Equivalents in securities accounts that are
Controlled Securities Accounts, in each case except for cash and Cash
Equivalents the aggregate value of which does not exceed $500,000 for any 10
consecutive Business Days.
(b) The Administrative Agent shall not have any responsibility for, or
bear any risk of loss of, any investment or income of any funds in any Cash
Collateral Account. From time to time after funds are deposited in any Cash
Collateral Account, the Administrative Agent may apply funds then held in such
Cash Collateral Account to the payment of Obligations in accordance with Section
2.12. No Group Member and no Person claiming on behalf of or through any Group
Member shall have any right to demand payment of any funds held in any Cash
Collateral Account at any time prior to the termination of all Term Loan
Commitments and the payment in full of all Obligations.
Section 7.12 Interest Rate Contracts. The Borrower shall, within 60
days after the Closing Date, enter into and thereafter maintain Interest Rate
Contracts on terms and with counterparties reasonably satisfactory to the
Administrative Agent, to provide protection against fluctuation of interest
rates until the third anniversary of the Closing Date for a notional amount
that, when added to the aggregate principal amount of Consolidated Total Debt of
Holdings bearing interest at a fixed rate, equals at least 35% of the aggregate
principal amount of the Consolidated Total Debt of Holdings..
Section 7.13 Credit Rating. The Borrower shall at all times use its
commercially reasonable efforts to obtain and to cause a credit rating by S&P
and by Xxxxx'x to be maintained with respect to the Term Loan Facility and
Borrower hereunder.
Section 7.14 Merger. Holdings shall use its best efforts to consummate
the Merger in accordance with the terms of the Acquisition Agreement as soon as
possible on or after the Closing Date. If, at any time on or after the Closing
Date, the Target Shares beneficially owned by AcquisitionCo, together with any
Target Shares beneficially owned by Holdings and its other Affiliates (as
defined in the Acquisition Agreement), shall collectively represent at least 90%
of the outstanding Target Shares, then Holdings shall take all actions necessary
and appropriate to cause the Merger to become effective as soon as practicable
without a meeting of
65
the Target's stockholders in accordance with Section 253 of the Delaware General
Corporation Law. Except to the extent otherwise expressly provided under Section
7.15, on the Merger Funding Date (or thereafter as agreed by the Administrative
Agent) the Borrower shall deliver or caused to be delivered to the
Administrative Agent, unless otherwise agreed by the Administrative Agent, in
form and substance satisfactory to the Administrative Agent:
(a) a joinder to the Guaranty and Security Agreement, duly executed by
Target and each Subsidiary thereof which is not an Excluded Foreign Subsidiary
(each a "Target Subsidiary Guarantor"), together with (A) copies of UCC,
Intellectual Property and other appropriate search reports and of all effective
prior filings listed therein, together with evidence of the termination of such
prior filings and other documents with respect to the priority of the security
interest of the Administrative Agent in the Collateral, in each case as may be
reasonably requested by the Administrative Agent, (B) all documents representing
all Securities, chattel paper and instruments being pledged pursuant to such
joinder and related undated powers or endorsements duly executed in blank, and
(C) all Control Agreements that, in the reasonable judgment of the
Administrative Agent, are required for the Loan Parties to comply with the Loan
Documents as of the Merger Funding Date, each duly executed by the parties
thereto;
(b) take such actions as are required under Section 7.10(d) and (e)
with respect to the Target and its Subsidiaries;
(c) duly executed favorable opinions of counsel to the Loan Parties in
New York and in each other jurisdiction in which the Target or any Target
Subsidiary Guarantor is organized satisfactory to the Administrative Agent, each
addressed to the Administrative Agent and the Lenders and addressing such
matters as the Administrative Agent may reasonably request;
(d) a copy of each Constituent Document of Target and each Target
Subsidiary Guarantor that is on file with any Governmental Authority in any
jurisdiction, certified as of a recent date by such Governmental Authority,
together with, if applicable, certificates attesting to the good standing of
such Loan Party in such jurisdiction;
(e) a certificate of the secretary, assistant secretary or other
officer of Target and each such Target Subsidiary Guarantor in charge of
maintaining books and records of Target and or each such Target Subsidiary
Guarantor certifying as to (A) the names and signatures of each officer of
Target and or each such Target Subsidiary Guarantor authorized to execute and
deliver any Loan Document and who will execute any such Loan Document, (B) the
Constituent Documents of Target and or each such Target Subsidiary Guarantor
attached to such certificate are complete and correct copies of such Constituent
Documents as in effect on the date of such certification (or, for any such
Constituent Document delivered pursuant to clause (d) above, that there have
been no changes from such Constituent Document so delivered) and (C) the
resolutions of Target and or each such Target Subsidiary Guarantor's board of
directors or other appropriate governing body approving and authorizing the
execution, delivery and performance of each Loan Document to which Target and
each such Target Subsidiary Guarantor is a party;
(f) a certificate of a Responsible Officer of Holdings to the effect
that each condition to release of the Acquisition Cash Collateral Funds on the
Merger Funding Date set forth in Section 2.19 has been satisfied;
66
(g) a certificate of a Responsible Officer of the Borrower to the
effect that the Merger has been consummated together with a copy of the filed
certificate of merger; and
(h) such other documents and information as any Lender through the
Administrative Agent may reasonably request.
Section 7.15 Postclosing Deliveries. The Borrower shall deliver to
Administrative Agent, in form and substance reasonably satisfactory to
Administrative Agent, the items (or undertake the efforts) described on Schedule
7.15 on or before the dates specified with respect to such items and efforts, or
such later dates as may be agreed to by Administrative Agent, in its sole
discretion.
ARTICLE VIII
NEGATIVE COVENANTS
Each of Holdings and the Borrower (and, to the extent set forth in any
other Loan Document, each other Loan Party) agrees with the Lenders and the
Administrative Agent to each of the following, as long as any Obligation or any
Commitment remains outstanding:
Section 8.1 Indebtedness. No Group Member shall, directly or
indirectly, incur or otherwise remain liable with respect to or responsible for,
any Indebtedness except for the following:
(a) the Obligations;
(b) Indebtedness existing on the date hereof and set forth on Schedule
8.1, together with any Permitted Refinancing of any Indebtedness permitted
hereunder in reliance upon this clause (b);
(c) Indebtedness consisting of Capitalized Lease Obligations (other
than with respect to a lease entered into as part of a Sale and Leaseback
Transaction) and purchase money Indebtedness, in each case incurred by any Group
Member (other than Holdings) to finance the acquisition, repair, improvement or
construction of fixed or capital assets (including any associated software or
other general intangibles) of such Group Member, together with any Permitted
Refinancing of any Indebtedness permitted hereunder in reliance upon this clause
(c); provided, however, that (i) the aggregate outstanding principal amount of
all such Indebtedness (excluding any such Indebtedness set forth on Schedule
8.1) does not exceed $17,250,000 at any time and (ii) the principal amount of
such Indebtedness does not exceed the cost of the property so acquired or built
or of such repairs or improvements financed, whether directly or through a
Permitted Refinancing, with such Indebtedness;
(d) Capitalized Lease Obligations arising under Sale and Leaseback
Transactions permitted hereunder in reliance upon Section 8.4(b)(ii) or Section
8.4(g);
(e) intercompany loans owing to any Group Member or any Subsidiary of
any Group Member and constituting Permitted Investments of such Group Member;
67
(f) (i) obligations under Interest Rate Contracts entered into to
comply with Section 7.12 and (ii) obligations under other Hedging Agreements
entered into for the sole purpose of hedging in the normal course of business
and consistent with industry practices;
(g) Guaranty Obligations of (i) any Loan Party with respect to
Indebtedness permitted hereunder of any other Loan Party, other than Holdings,
and (ii) any Group Member that is not a Loan Party with respect to Indebtedness
permitted hereunder of any Group Member;
(h) Indebtedness under the First Lien Loan Documents in an aggregate
outstanding principal amount not to exceed the Maximum First Lien Indebtedness
Amount (as defined in the Intercreditor Agreement) at any time and any Permitted
Refinancing thereof;
(i) unsecured Indebtedness of the Borrower owing under the
Subordinated Convertible Notes pursuant to the Subordinated Convertible Notes
Indenture and Permitted Refinancings thereof; provided, however, that the
aggregate outstanding principal amount of all such Indebtedness shall not exceed
$172,500,000 at any time;
(j) Permitted Acquisition Debt;
(k) any unsecured Indebtedness of any Group Member; provided, however,
that the aggregate outstanding principal amount of all such unsecured
Indebtedness shall not exceed $34,500,000 at any time;
(l) any Indebtedness of any Group Member that is not a Loan Party
provided, however, that the aggregate outstanding principal amount of all such
Indebtedness shall not exceed $23,000,000 at any time;
(m) Permitted Subordinated Debt and Permitted Refinancings thereof;
(n) Indebtedness permitted under Section 8.2(f); and
(o) Guaranty Obligations under or with respect to the P&G Holdings
Guaranty, P&G Capital Call Obligations or otherwise under the P&G JV Agreements.
Section 8.2 Liens. No Group Member shall incur, maintain or otherwise
suffer to exist any Lien upon or with respect to any of its property (other than
Target Margin Stock), whether now owned or hereafter acquired, except for the
following:
(a) Liens created pursuant to any Loan Document;
(b) Customary Permitted Liens of Group Members;
(c) Liens existing on the date hereof and set forth on Schedule 8.2;
(d) Liens on the property of any Group Member securing Indebtedness
permitted hereunder in reliance upon Section 8.1(c); provided, however, that (i)
such Liens exist prior to the acquisition of, or attach substantially
simultaneously with, or within 90 days after, the acquisition, repair,
improvement or construction of, such property financed, whether directly or
through a Permitted Refinancing, by such Indebtedness and (ii) such Liens do not
extend to any property of any Group Member other than the property (and proceeds
thereof) acquired or built,
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or the improvements or repairs, financed, whether directly or through a
Permitted Refinancing, by such Indebtedness;
(e) Liens on the property of any Group Member securing the Permitted
Refinancing of any Indebtedness secured by any Lien on such property permitted
hereunder in reliance upon clause (c) or (d) above or this clause (e) without
any increase in the property subject to such Liens;
(f) Liens on any property of any Loan Party securing any of their
Indebtedness or their other liabilities; provided, however, that the aggregate
outstanding principal amount of all such Indebtedness and other liabilities
shall not exceed $5,750,000 at any time;
(g) Liens on the property of any Group Member that is not a Loan Party
securing Indebtedness permitted hereunder in reliance upon Section 8.1(l);
(h) Liens securing the loans and other obligations under the First
Lien Loan Documents and Permitted Refinancings thereof;
(i) Liens on assets acquired in any Permitted Acquisition securing
Permitted Acquisition Debt assumed in connection with such Permitted
Acquisition; provided that such Lien was not created in contemplation of such
Permitted Acquisition and does not extend to or cover any other assets or
property (other than the proceeds or products thereof); and
(j) Liens on the property of any Group Member subject to a Sale and
Leaseback Transaction permitted under Section 8.4(b)(ii) or (g) securing
Indebtedness permitted hereunder in reliance upon Section 8.1(d); provided,
however, that such Liens do not extend to any property of any Group Member other
than the property (and proceeds thereof) subject to such Sale and Leaseback
Transaction.
Section 8.3 Investments. No Group Member shall make or maintain,
directly or indirectly, any Investment except for the following:
(a) Investments set forth on Schedule 8.3 and Investments set forth on
Schedule 4.3(a);
(b) Investments in cash and Cash Equivalents;
(c) (i) endorsements for collection or deposit in the ordinary course
of business consistent with past practice, (ii) extensions of trade credit
arising or acquired in the ordinary course of business and (iii) Investments
received in settlements in the ordinary course of business of such extensions of
trade credit;
(d) Investments made as part of a Permitted Acquisition;
(e) Investments by (i) Holdings in any of its Subsidiaries which are
Loan Parties, (ii) any Loan Party (other than Holdings) in any other Loan Party,
(iii) any Group Member that is not a Loan Party in any Group Member or in any
joint venture, and (iv) any Loan Party (other than Holdings) in any Group Member
that is not a Loan Party or in any joint venture; provided, however, that any
Investment consisting of loans or advances to any Loan Party
69
pursuant to clause (iii) above shall be subordinated in full to the payment of
the Obligations of such Loan Party on terms and conditions satisfactory to the
Administrative Agent;
(f) loans or advances to employees of Holdings or any of its
Subsidiaries to finance travel, entertainment and relocation expenses and other
ordinary business purposes in the ordinary course of business; provided,
however, that the aggregate outstanding principal amount of all loans and
advances permitted pursuant to this clause (f) shall not exceed $1,150,000 at
any time;
(g) pledges and deposits made by a Group Member to the extent
permitted under Section 8.2(b);
(h) Hedging Agreements entered into by a Loan Party or any of its
Subsidiaries to the extent permitted under Section 8.1(f);
(i) Guaranty Obligations to the extent permitted under Section 8.1;
(j) payments required under the P&G JV Capital Call Obligations to the
P&G JV Companies in accordance with the P&G JV Agreements, in an amount not to
exceed $11,500,000 for any individual capital call at any time or $23,000,000 in
the aggregate for all such capital calls during any Fiscal Year; provided that
no Default or Event of Default exists or will result from the making of any such
payment and, after giving effect to such payment, the Loan Parties shall have
unused First Lien Revolving Credit Commitments and available cash and Cash
Equivalents on deposit to a Cash Collateral Account (other than the Acquisition
Cash Collateral Account) or a Controlled Deposit Account of at least $42,500,000
in the aggregate;
(k) any Investment by Holdings or any of its Subsidiaries; provided,
however, that the aggregate outstanding amount of all such Investments shall not
exceed $115,000,000 at any time; and
(l) any Restricted Payment permitted pursuant to Section 8.5.
Notwithstanding the foregoing, the sum of (x) the fair market value of all
Permitted Acquisitions (or portions thereof) (other than the Cholestech
Acquisition) and (y) the aggregate net amount of other Investments (or portions
thereof) (which in the case of Investments that are intercompany loans shall
mean the outstanding balance thereof), in each case funded or made in or
transferred to, or made or acquired by, any Person after the Closing Date
(excluding in each case, any Excluded Investments, as defined below) that is
not, or does not become after giving effect to such Permitted Acquisition or
other Investment, a Loan Party (including (subject to the foregoing) the amount
of any Permitted Acquisition Consideration (or portion thereof) payable in
respect of any Proposed Acquisition Target which will not constitute a Loan
Party after giving effect to the applicable Permitted Acquisition as reasonably
determined by Administrative Agent) shall not exceed the greater of (x) 5.75% of
Total Assets and (y) $172,500,000 in the aggregate after the Closing Date. For
purposes of any determination under the immediately preceding sentence, (i) the
fair market value of any Permitted Acquisition or amount of any other Investment
shall at all times be the original fair market value or amount thereof at the
time of the making thereof, and (ii) no decrease in Total Assets following the
time of the making of any Permitted Acquisition or Investment shall apply to
such Permitted Acquisition or Investment or any previously made Permitted
Acquisition or Investment. As used herein "Excluded Investments" means
collectively (i) Permitted Acquisitions and other Investments (or portions
70
thereof) to the extent funded or made with the Net Cash Proceeds of the issuance
of common stock of Holdings or Permitted Subordinated Debt, (ii) Permitted
Acquisition Consideration payable in common stock of Holdings and (iii)
Investments by a Group Member which is not a Loan Party in any other Group
Member which is not a Loan Party.
Section 8.4 Asset Sales and Stock Issuances. No Group Member shall
Sell any of its property (other than cash) or issue shares of its own Stock,
except for the following:
(a) (i) in each case to the extent entered into in the ordinary course
of business for fair market value, (A) Sales of Cash Equivalents or inventory,
and (B) Sales of property that has become obsolete or worn out or is no longer
used by or useful to the Group Members, (ii) Sales of Target Margin Stock for
fair market value, (iii) non-exclusive licenses of Intellectual Property in the
ordinary course of its business, and (iv) Sales of property to participants in
clinical trials or in connection with research projects, in each case in the
ordinary course of business and in accordance with past practices;
(b) (i) a true lease or sublease of real property in the ordinary
course of business not constituting Indebtedness and not entered into as part of
a Sale and Leaseback Transaction and (ii) a Sale of property pursuant to a Sale
and Leaseback Transaction; provided, however, that the aggregate fair market
value (measured at the time of the applicable Sale) of all property covered by
any outstanding Sale and Leaseback Transaction at any time shall not exceed
$11,500,000;
(c) (i) any Sale of any property (other than their own Stock or Stock
Equivalents) by any Group Member (other than Holdings) to any other Group Member
(other than Holdings) to the extent any resulting Investment constitutes a
Permitted Investment, (ii) any Restricted Payment by any Group Member (other
than Holdings) permitted pursuant to Section 8.5, (iii) any distribution by
Holdings of the proceeds of Restricted Payments from any other Group Member to
the extent permitted in Section 8.5, and (iv) any Permitted Investment;
(d) (i) any Sale or issuance by Holdings of its own Stock, (ii) any
Sale or issuance by any directly-owned Subsidiary of Holdings of its own Stock
to Holdings, (iii) any Sale or issuance by any Subsidiary of Holdings of its own
Stock to any Loan Party (other than Holdings), (iv) any Sale or issuance by any
Subsidiary of Holdings which is not a Loan Party of its own Stock to any
Subsidiary of Holdings which is not a Loan Party, (v) to the extent necessary to
satisfy any Requirement of Law in the jurisdiction of incorporation of any
Subsidiary of Holdings, any Sale or issuance by such Subsidiary of its own Stock
constituting directors' qualifying shares or nominal holdings, and (vi) any Sale
or issuance by Target of its own Stock or Stock Equivalents prior to the Merger
Funding Date pursuant to Contractual Obligations or arrangements entered into
prior to the Closing Date (including pursuant to any such Stock Equivalents);
(e) as long as no Default or Event of Default is continuing or would
result therefrom, any Sale of property (other than as part of a Sale and
Leaseback Transaction) of, or Sale or issuance of its own Stock by, any Group
Member (other than Holdings) for fair market value payable in cash upon such
sale; provided, however, that the aggregate consideration received during any
Fiscal Year for all such Sales shall not exceed $17,250,000;
(f) as long as no Default or Event of Default is continuing or would
result therefrom, (i) any Sale of property to the P&G Joint Venture required
under P&G JV Agreements
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or (ii) any Sale of the Group Members' equity interests in the P&G Joint Venture
pursuant to the P&G Call Option; and
(g) as long as no Default or Event of Default is continuing or would
result therefrom, any Sale of real property consummated prior to the second
anniversary of the Closing Date (including as part of a Sale and Leaseback
Transaction) for fair market value payable in cash upon such sale; provided,
however, that the aggregate consideration received after the Closing Date for
all such Sales shall not exceed $172,500,000.
Section 8.5 Restricted Payments. No Group Member shall directly or
indirectly, declare, order, pay, make or set apart any sum for any Restricted
Payment except for the following (and Holdings shall not use the proceeds of any
Restricted Payment made in reliance under clause (c) below other than as set
forth in such clause (c), which payments are expressly permitted under this
Section 8.5, whether or not funded by cash dividends or other distributions to
Holdings as permitted under clause (c) below):
(a) (i) Restricted Payments (A) by any Group Member (other than
Holdings) that is a Loan Party to any other Loan Party other than Holdings and
(B) by any Group Member that is not a Loan Party to any Group Member other than
Holdings and (ii) dividends and distributions by any Subsidiary of Holdings that
is not a Loan Party to any holder of its Stock, to the extent made to all such
holders ratably according to their ownership interests in such Stock;
(b) dividends and distributions declared and paid on the common Stock
of any Group Member ratably to the holders of such common Stock and payable only
in common Stock of such Group Member;
(c) the following by Holdings, and cash dividends or other
distributions on the Stock of Subsidiaries of Holdings to Holdings paid,
declared and used solely for the purpose of funding the following:
(i) payments by Holdings in respect of taxes owing by Holdings in
respect of any Group Members or any of their Subsidiaries;
(ii) ordinary operating expenses of Holdings, including employee
compensation, and other amounts approved by the Administrative Agent;
(iii) (a) scheduled interest payments on the Subordinated
Convertible Notes and payments of additional interest on the Subordinated
Convertible Notes by reason of any failure by Holdings to file a
registration statement with respect to, or register, the Subordinated
Convertible Notes and the shares of Holdings' common stock issuable upon
conversion thereof or as contemplated by Section 8.02 of the Subordinated
Convertible Notes Indenture, in each case in accordance with the terms of
the Subordinated Convertible Notes Documents, (b) interest payments in
respect of other Subordinated Debt in accordance with the terms thereof and
not in violation of any subordination terms thereof, and (c) payments in
respect of the Obligations; and
(iv) the redemption, purchase or other acquisition or retirement
for value by Holdings of its common Stock (or Stock Equivalents with
respect to its common Stock) (A) from any present or former employee,
director or officer (or the assigns, estate, heirs or current or former
spouses thereof) of any Group Member upon the death,
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disability or termination of employment of such employee, director or
officer; provided, however, that the amount of such cash dividends paid in
any Fiscal Year shall not exceed $5,750,000 in the aggregate or (B) from
any other Person; provided, however, that the amount of such cash dividends
paid in any Fiscal Year in reliance upon this clause (B) shall not exceed
$5,750,000 in the aggregate;
provided, however, that no action that would otherwise be permitted hereunder in
reliance upon this clause (c) (other than clause (i) or (ii) above) shall be
permitted if (A) a Default or Event of Default is then continuing or would
result therefrom or (B) such action is otherwise prohibited under any Loan
Document or under the terms of any Indebtedness (other than the Obligations) of
any Group Member.
(d) conversion of the Subordinated Convertible Notes into common stock
of Holdings in accordance with the Subordinated Convertible Notes Indenture.
Notwithstanding the foregoing, prior to the Merger Funding Date neither Target
nor AcquisitionCo shall be permitted to make any Restricted Payments.
Section 8.6 Prepayment of Indebtedness; Payments on Subordinated Debt.
No Group Member shall (x) prepay, redeem, purchase, defease or otherwise satisfy
prior to the scheduled maturity thereof any Indebtedness (other than the First
Lien Obligations), (y) set apart any property for such purpose, whether directly
or indirectly and whether to a sinking fund, a similar fund or otherwise, or (z)
make any payment in violation of any subordination terms of any Subordinated
Debt; provided, however, that each Group Member may, to the extent otherwise
permitted by the Loan Documents, do each of the following:
(a) (i) prepay the Obligations, (ii) consummate a Permitted
Refinancing permitted hereunder in reliance upon Section 8.1(b), (c), (i), or
(m), (iii) prepay in full on the Closing Date the Payoff Debt, and (iv) prepay
Indebtedness permitted hereunder in reliance upon Section 8.1(d), (k), (l), or
(n);
(b) prepay, redeem, purchase, defease or otherwise satisfy prior to
the scheduled maturity thereof (or set apart any property for such purpose) in
the case of any Group Member, any Indebtedness owing by such Group Member to any
other Group Member and permitted under Section 8.1;
(c) make regularly scheduled or otherwise required repayments or
redemptions of Indebtedness (other than any Subordinated Debt);
(d) prepayments of purchase money Indebtedness and Capitalized Lease
Obligations upon a sale of the asset securing such Indebtedness or subject to
such Capitalized Lease Obligation;
(e) [Intentionally Omitted]; and
(f) convert the Subordinated Convertible Notes into common stock of
Holdings in accordance with the Subordinated Convertible Notes Indenture.
Section 8.7 Fundamental Changes. No Group Member shall (a) merge,
consolidate, dissolve or amalgamate with any Person, (b) acquire all or
substantially all of the
73
Stock or Stock Equivalents of any Person or (c) acquire all or substantially all
of the assets of any Person or all or substantially all of the assets
constituting any line of business, division, branch, operating division or other
unit operation of any Person, in each case except for the following: (i) to
consummate any Permitted Acquisition and the Cholestech Acquisition, (ii) any
Sale permitted hereunder, (iii) the dissolution of the Inactive Subsidiaries,
(iv) the merger, consolidation or amalgamation of any Subsidiary of Holdings
with or into any other any Subsidiary of Holdings and (v) the merger,
consolidation or amalgamation of any Group Member (other than Holdings) for the
sole purpose, and with the sole material effect, of changing its State of
organization within the United States; provided, however, that (A) in the case
of any merger, consolidation or amalgamation involving the Borrower, the
Borrower shall be the surviving Person and (B) in the case of any merger,
consolidation or amalgamation involving any other Loan Party, a Loan Party shall
be the surviving corporation and all actions required to maintain the perfection
of the Lien of the Administrative Agent on the Stock or property of such Loan
Party shall have been made.
Section 8.8 Change in Nature of Business. (a) No Group Member shall
carry on any business, operations or activities (whether directly, through a
joint venture, in connection with a Permitted Acquisition or otherwise)
substantially different from those carried on by Holdings and its Subsidiaries
at the date hereof and business, operations and activities reasonably related
thereto.
(b) Holdings shall not engage in any business, operations or activity,
or hold any property, other than (i) holding Stock and Stock Equivalents of its
Subsidiaries, (ii) issuing, selling and redeeming its own Stock, (iii) issuing
Indebtedness and making and holding Investments permitted hereunder, (iv) paying
taxes and dividends permitted hereunder, (v) holding directors' and
shareholders' meetings, preparing corporate and similar records and other
activities required to maintain its separate corporate or other legal structure,
(vi) preparing reports to, and preparing and making notices to and filings with,
Governmental Authorities and to its holders of Stock and Stock Equivalents,
(vii) receiving, and holding proceeds of, Restricted Payments from its
Subsidiaries and distributing the proceeds thereof to the extent permitted in
Section 8.5, (viii) as necessary to consummate the transactions contemplated by
the Loan Documents or any Permitted Acquisition (including the incurrence and
performance of any payment, indemnification or other obligations not otherwise
prohibited hereunder) or any Related Transaction, (ix) owning and licensing of
intellectual property, (xi) engaging in any Sales permitted hereunder, (xii)
providing administrative and operational services to its Subsidiaries, (xiii)
engaging in the businesses and conducting the activities that it has engaged in
and conducted prior to the date hereof, (xiv) the entering into and performance
of obligations under the P&G JV Agreements, (xv) defending or otherwise taking
action deemed appropriate by Holdings with respect to any liabilities or assets
of Holdings or any other Group Member, including any litigation, action or
proceeding, including as set forth in Schedule 4.7, and (xvi) such other
business, operations and activities described on Schedule 8.8(b) or consented to
by the Administrative Agent.
(c) AcquisitionCo shall not engage in any business, operations or
activity, or hold any property, other than the following, in each case to the
extent permitted by AcquisitionCo's Constituent Documents, (i) holding Stock of
the Target, (ii) issuing, selling and redeeming its own Stock, (iii) paying
taxes and dividends permitted hereunder, (iv) holding directors' and
shareholders' meetings, preparing corporate and similar records and other
activities required to maintain its separate corporate or other legal structure,
(v) preparing reports to, and
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preparing and making notices to and filings with, Governmental Authorities and
to its holders of Stock, (vi) as necessary to consummate the transactions
contemplated by the Loan Documents or any Related Transaction and (vii) such
other business, operations and activities consented to by the Administrative
Agent.
(d) SPDH, Inc. shall not engage in any business, operations or
activity, or hold any property or have any assets or incur any Indebtedness or
Guaranteed Obligations other than, without duplication (i) owning the Stock of
US CD LLC owned by it on the date hereof, (ii) the entering into, and the
performance of obligations under the P&G JV Agreements to which it is a party,
(iii) making investments, contributions or distributions to US CD LLC to the
extent permitted under Section 8.3(j), (iv) paying taxes and making
distributions or dividends to Holdings, (v) engaging in activities incidental to
(A) the maintenance of its corporate existence in compliance with applicable law
and (B) legal, tax and accounting matters in connection with any of the
foregoing activities, (vi) as necessary to consummate the transactions
contemplated by the Loan Documents, (vii) holding directors' and shareholders'
meetings, preparing corporate and similar records and other activities required
to maintain its separate corporate or other legal structure, (viii) defending or
otherwise taking action deemed appropriate by SPDH, Inc. with respect to any
liabilities of SPDH, Inc., including any litigation, action or proceeding,
including as set forth in Schedule 4.7, and (ix) such other business, operations
and activities consented to by the Administrative Agent.
(e) None of the Inactive Subsidiaries shall engage in any material
business, operations or activity, or hold any material amount of property, other
than the following, (i) paying taxes and dividends permitted hereunder, (ii)
holding directors' and shareholders' meetings, preparing corporate and similar
records and other activities required to maintain its separate corporate or
other legal structure, (iii) preparing reports to, and preparing and making
notices to and filings with, Governmental Authorities and to its holders of
Stock, (iv) defending or otherwise taking action deemed appropriate by such
Inactive Subsidiary or any Group Member with respect to any liabilities of such
Inactive Subsidiary, including any litigation, action or proceeding, including
as set forth in Schedule 4.7, and (v) such other business, operations and
activities consented to by the Administrative Agent.
Section 8.9 Transactions with Affiliates. No Group Member shall,
except as otherwise expressly permitted herein or set forth on Schedule 8.9,
enter into any other transaction directly or indirectly with, or for the benefit
of, any Affiliate of Holdings that is not a Loan Party (including Guaranty
Obligations with respect to any obligation of any such Affiliate), except for
(a) transactions in the ordinary course of business on a basis no less favorable
to such Group Member as would be obtained in a comparable arm's length
transaction with a Person not an Affiliate of Holdings, (b) Restricted Payments,
the proceeds of which, if received by Holdings, are used as permitted by Section
8.5, (c) reasonable salaries and other reasonable director or employee
compensation to officers and directors of any Group Member, (d)(i) any
transaction with a P&G JV Company or any Subsidiary or member thereof pursuant
to the P&G JV Agreements or (ii) other transactions with a P&G JV Company or any
Subsidiary or member thereof for the manufacturing, packaging, supply or
distribution of products or materials, or the provision of other administrative
or operational services (whether on a transitional or ongoing basis), solely
with respect to the consumer diagnostic business, so long as, with respect to
this clause (ii), the Group Members' charges for manufacturing such products is
on a "cost-plus" basis, and (e) any transaction among or between Group Members
which are not Loan Parties.
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Section 8.10 Third-Party Restrictions on Indebtedness, Liens,
Investments or Restricted Payments. No Group Member shall incur or otherwise
suffer to exist or become effective or remain liable on or responsible for any
Contractual Obligation limiting the ability of (a) any Subsidiary of Holdings to
make Restricted Payments to, or Investments in, or repay Indebtedness or
otherwise Sell property to, any Group Member (other than Holdings) or (b) any
Group Member to incur or suffer to exist any Lien upon any property of any Group
Member, whether now owned or hereafter acquired, securing any of its Obligations
(including any "equal and ratable" clause and any similar Contractual Obligation
requiring, when a Lien is granted on any property, another Lien to be granted on
such property or any other property), except, for each of clauses (a) and (b)
above, (x) pursuant to the Loan Documents, (y) pursuant to the First Lien Loan
Documents and any Permitted Refinancing thereof and (z) limitations on Liens
(other than those securing any Obligation) on any property whose acquisition,
repair, improvement or construction is financed by purchase money Indebtedness,
Capitalized Lease Obligations or Permitted Refinancings permitted hereunder in
reliance upon Section 8.1(b) or (c) set forth in the Contractual Obligations
governing such Indebtedness, Capitalized Lease Obligations or Permitted
Refinancing or Guaranty Obligations with respect thereto.
Section 8.11 Modification of Certain Documents. No Group Member shall
do any of the following:
(a) waive or otherwise modify any term of, or provide any consent
under, any Related Document (other than any First Lien Loan Document and the
Cholestech Acquisition Agreement) or any Constituent Document of, or otherwise
change the capital structure of, any Group Member (including the terms of any of
their outstanding Stock or Stock Equivalents), in each case except for those
modifications, consents and waivers that (x) do not elect, or permit the
election, to treat the Stock or Stock Equivalents of any limited liability
company (or similar entity) as certificated and (y) do not materially adversely
affect the interests of any Secured Party under the Loan Documents or in the
Collateral;
(b) waive or otherwise modify any term of any Subordinated Debt (or
any Subordinated Convertible Notes Document) if the effect thereof on such
Subordinated Debt is to (i) increase the interest rate, (ii) change the due
dates for principal or interest, other than to extend such dates, (iii) modify
any default or event of default, other than to delete it or make it less
restrictive, (iv) add any material covenant with respect thereto, (v) modify any
subordination provision, (vi) modify any redemption or prepayment provision,
other than to extend the dates therefor or to reduce the premiums payable in
connection therewith or (vii) materially increase any obligation of any Group
Member or confer additional material rights to the holder of such Subordinated
Debt in a manner adverse to any Group Member or any Secured Party.
(c) amend, or enter into supplementary agreements with respect to, the
P&G JV Agreements in a manner which could reasonably be expected to have a
Material Adverse Effect without the prior written consent of Administrative
Agent; provided that the Borrower shall provide Administrative Agent with a copy
of any such material amendment or supplementary agreement.
(d) waive or otherwise modify any term of the First Lien Loan
Documents, other than any such waiver or modification that is permitted to be
made pursuant to the Intercreditor Agreement.
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(e) permit any Indebtedness (other than the Obligations and the First
Lien Obligations) to qualify as "Designated Senior Indebtedness" under the
Subordinated Convertible Notes Indenture or any other Subordinated Convertible
Notes Document or permit the Obligations to cease qualifying as such or as
"Senior Indebtedness" as defined in the Subordinated Convertible Notes
Indenture.
Section 8.12 Accounting Changes; Fiscal Year. No Group Member shall
change its (a) accounting treatment or reporting practices, except as required
by GAAP or any Requirement of Law or (b) its fiscal year or its method for
determining fiscal quarters or fiscal months.
Section 8.13 Margin Regulations. No Group Member shall use all or any
portion of the proceeds of any credit extended hereunder to purchase or carry
margin stock (within the meaning of Regulation U of the Federal Reserve Board)
in contravention of Regulation U of the Federal Reserve Board.
Section 8.14 Compliance with ERISA. No ERISA Affiliate shall cause or
suffer to exist (a) any event that could result in the imposition of a Lien with
respect to any Title IV Plan or Multiemployer Plan or (b) any other ERISA Event,
that would, in the aggregate, have a Material Adverse Effect. No Group Member
shall cause or suffer to exist any event that could result in the imposition of
a Lien with respect to any Benefit Plan.
Section 8.15 Hazardous Materials. No Group Member shall cause or
suffer to exist any Release of any Hazardous Material at, to or from any real
property owned, leased, subleased or otherwise operated or occupied by any Group
Member that would violate any Environmental Law, form the basis for any
Environmental Liabilities or otherwise adversely affect the value or
marketability of any real property (whether or not owned by any Group Member),
other than such violations, Environmental Liabilities and effects that would
not, in the aggregate, have a Material Adverse Effect.
ARTICLE IX
EVENTS OF DEFAULT
Section 9.1 Definition. Each of the following shall be an Event of
Default:
(a) the Borrower shall fail to pay (i) any principal of any Loan when
the same becomes due and payable or (ii) any interest on any Loan, any fee under
any Loan Document or any other Obligation (other than those set forth in clause
(i) above) and, in the case of this clause (ii), such non-payment continues for
a period of 5 Business Days after the due date therefor; or
(b) any representation, warranty or certification made or deemed made
by or on behalf of any Loan Party (or any Responsible Officer thereof) in any
Loan Document shall prove to have been incorrect in any material respect when
made or deemed made; or
(c) any Loan Party shall fail to comply with (i) any provision of
Article V (Financial Covenants), Section 6.1 (Financial Statements), 6.2(a)
(Other Events), 7.1(a) (Maintenance of Corporate Existence), 7.9 (Use of
Proceeds), 7.14 (Merger), 7.15 (Postclosing Deliveries) or Article VIII
(Negative Covenants) or (ii) any other provision of any Loan Document if, in the
case of this clause (ii), such failure shall remain unremedied for 30 days after
77
the earlier of (A) the date on which a Responsible Officer of the Borrower
becomes aware of such failure and (B) the date on which notice thereof shall
have been given to the Borrower by the Administrative Agent or the Required
Lenders; or
(d) (i) any Group Member (other than an Immaterial Subsidiary) shall
fail to make any payment when due (after giving effect to any applicable grace
or cure period) (whether due because of scheduled maturity, required prepayment
provisions, acceleration, demand or otherwise) on any Indebtedness of any such
Group Member (other than the Obligations or any Hedging Agreement) and, in each
case, such failure relates to Indebtedness having a principal amount of
$5,750,000 or more, (ii) any other event shall occur or condition shall exist
under any Contractual Obligation relating to any Indebtedness (other than the
Obligations, any Hedging Agreement or the First Lien Obligations) of any Group
Member (other than an Immaterial Subsidiary) having a principal amount of
$5,750,000 or more (after giving effect to any applicable grace or cure period)
if the effect of such event or condition is to accelerate, or to permit the
acceleration of, the maturity of such Indebtedness, (iii) any such Indebtedness
referred to in clause (ii) above shall become or be declared to be due and
payable, or be required to be prepaid, redeemed, defeased or repurchased (other
than by a regularly scheduled required prepayment), prior to the stated maturity
thereof, or (iv) any portion of the First Lien Obligations is declared to be due
and payable (or automatically becomes due and payable) prior to the stated
maturity of the First Lien Obligations as a result of an "Event of Default" (as
defined in the First Lien Credit Agreement); or
(e) (i) any Group Member (other than an Immaterial Subsidiary) shall
generally not pay its debts as such debts become due, shall admit in writing its
inability to pay its debts generally or shall make a general assignment for the
benefit of creditors, (ii) any proceeding shall be instituted by or against any
such Group Member seeking to adjudicate it a bankrupt or insolvent or seeking
liquidation, winding up, reorganization, arrangement, adjustment, protection,
relief, composition of it or its debts or any similar order, in each case under
any Requirement of Law relating to bankruptcy, insolvency or reorganization or
relief of debtors or seeking the entry of an order for relief or the appointment
of a custodian, receiver, trustee, conservator, liquidating agent, liquidator,
other similar official or other official with similar powers, in each case for
it or for any substantial part of its property and, in the case of any such
proceedings instituted against (but not by or with the consent of) any Group
Member (other than an Immaterial Subsidiary), either such proceedings shall
remain undismissed or unstayed for a period of 60 days or more or any action
sought in such proceedings shall occur, (iii) any Group Member (other than an
Immaterial Subsidiary) shall take any corporate or similar action or any other
action to authorize any action described in clause (i) or (ii) above or (iv)
Holdings and its Subsidiaries, taken as a group on a consolidated basis, cease
to be Solvent; or
(f) one or more judgments, orders or decrees (or other similar
process) shall be rendered against any Group Member (other than an Immaterial
Subsidiary) (i)(A) in the case of money judgments, orders and decrees, involving
an aggregate amount (excluding amounts adequately covered by insurance payable
to any such Group Member, to the extent the relevant insurer has not denied
coverage therefor) in excess of $5,750,000 or (B) otherwise, that would have,
either individually or in the aggregate, a Material Adverse Effect and (ii)(A)
enforcement proceedings shall have been commenced by any creditor upon any such
judgment, order or decree or (B) such judgment, order or decree shall not have
been vacated or discharged for a period of 30 consecutive days and there shall
not be in effect (by reason of a pending appeal or otherwise) any stay of
enforcement thereof; or
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(g) except pursuant to a valid, binding and enforceable termination or
release permitted under the Loan Documents and executed by the Administrative
Agent or as otherwise expressly permitted under any Loan Document, (i) any
provision of any Loan Document shall, at any time after the delivery of such
Loan Document, fail to be valid and binding on, or enforceable against, any Loan
Party party thereto in any material respect, (ii) any Loan Document purporting
to xxxxx x Xxxx to secure any Obligation shall, at any time after the delivery
of such Loan Document, fail to create a valid and enforceable Lien on any
Collateral purported to be covered thereby or such Lien shall fail or cease to
be a perfected Lien with the priority required in the relevant Loan Document or
(iii) any subordination provision set forth in any Subordinated Convertible
Notes Document shall, in whole or in part, terminate or otherwise fail or cease
to be valid and binding on, or enforceable against any holder of the
Subordinated Convertible Notes, or any trustee therefor (or any such holder or
trustee shall so state in writing), or any Group Member shall state in writing
that any of the events described in clause (i), (ii) or (iii) above shall have
occurred; or
(h) there shall occur any Change of Control; or
(i) after giving effect to the exercise of the P&G Put Option on the
P&G JV Put Date, Holdings is not in compliance with the financial covenants set
forth in Article 5 (determined for this purpose on a pro forma basis as if the
P&G Put Option was consummated on the valuation date of the Put Option in
accordance with the terms thereof and after giving effect to consummation of the
P&G Put Option and any payments in respect thereof); or
(j) the Merger Funding Date shall not have occurred by the first
anniversary of the Closing Date.
Section 9.2 Remedies. During the continuance of any Event of Default,
the Administrative Agent may, and, at the request of the Required Lenders,
shall, in each case by notice to the Borrower and in addition to any other right
or remedy provided under any Loan Document or by any applicable Requirement of
Law, do each or any of the following: (a) declare all or any portion of the
Commitments terminated, whereupon the Commitments shall immediately be reduced
by such portion or, in the case of a termination in whole, shall terminate
together with any obligation any Lender may have hereunder to make any Loan, (b)
declare immediately due and payable all or part of any Obligation (including any
accrued but unpaid interest thereon), whereupon the same shall become
immediately due and payable, without presentment, demand, protest or further
notice or other requirements of any kind, all of which are hereby expressly
waived by Holdings and the Borrower (and, to the extent provided in any other
Loan Document, other Loan Parties); provided, however, that, effective
immediately upon the occurrence of any Event of Default specified in Section
9.1(e)(ii), (x) the Commitments of each Lender to make Loans shall each
automatically be terminated and (y) each Obligation (including in each case any
accrued all accrued but unpaid interest thereon) shall automatically become and
be due and payable, without presentment, demand, protest or further notice or
other requirement of any kind, all of which are hereby expressly waived by
Holdings and the Borrower (and, to the extent provided in any other Loan
Document, any other Loan Party), or (c) take the actions described in Section
9.3, and (d) exercise any other remedies which may be available under the Loan
Documents or applicable law.
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ARTICLE X
THE ADMINISTRATIVE AGENT
Section 10.1 Appointment and Duties. (a) Appointment of Administrative
Agent. Each Lender hereby appoints GE Capital (together with any successor
Administrative Agent pursuant to Section 10.9) as the Administrative Agent
hereunder and authorizes the Administrative Agent to (i) execute and deliver the
Loan Documents and accept delivery thereof on its behalf from any Group Member,
(ii) take such action on its behalf and exercise all rights, powers and remedies
and perform the duties as are expressly delegated to the Administrative Agent
under the Loan Documents and (iii) exercise such powers as are reasonably
incidental thereto.
(b) Duties as Collateral and Disbursing Agent. Without limiting the
generality of clause (a) above, the Administrative Agent shall have the sole and
exclusive right and authority (to the exclusion of the Lenders), and is hereby
authorized, to (i) act as the disbursing and collecting agent for the Lenders
with respect to all payments and collections arising in connection with the Loan
Documents (including in any proceeding described in Section 9.1(e)(ii) or any
other bankruptcy, insolvency or similar proceeding), and each Person making any
payment in connection with any Loan Document to any Secured Party is hereby
authorized to make such payment to the Administrative Agent, (ii) file and prove
claims and file other documents necessary or desirable to allow the claims of
the Secured Parties with respect to any Obligation in any proceeding described
in Section 9.1(e)(ii) or any other bankruptcy, insolvency or similar proceeding
(but not to vote, consent or otherwise act on behalf of such Secured Party),
(iii) act as collateral agent for each Secured Party for purposes of the
perfection of all Liens created by such agreements and all other purposes stated
therein, (iv) manage, supervise and otherwise deal with the Collateral, (v) take
such other action as is necessary or desirable to maintain the perfection and
priority of the Liens created or purported to be created by the Loan Documents,
(vi) except as may be otherwise specified in any Loan Document, exercise all
remedies given to the Administrative Agent and the other Secured Parties with
respect to the Collateral, whether under the Loan Documents, applicable
Requirements of Law or otherwise and (vii) execute any amendment, consent or
waiver under the Loan Documents on behalf of any Lender that has consented in
writing to such amendment, consent or waiver; provided, however, that the
Administrative Agent hereby appoints, authorizes and directs each Lender to act
as collateral sub-agent for the Administrative Agent and the Lenders for
purposes of the perfection of all Liens with respect to the Collateral,
including any deposit account maintained by a Loan Party with, and cash and Cash
Equivalents held by, such Lender, and may further authorize and direct the
Lenders to take further actions as collateral sub-agents for purposes of
enforcing such Liens or otherwise to transfer the Collateral subject thereto to
the Administrative Agent, and each Lender hereby agrees to take such further
actions to the extent, and only to the extent, so authorized and directed.
(c) Limited Duties. Under the Loan Documents, the Administrative Agent
(i) is acting solely on behalf of the Lenders (except to the limited extent
provided in Section 2.14(b) with respect to the Register and in Section 11.11),
with duties that are entirely administrative in nature, notwithstanding the use
of the defined term "Administrative Agent", the terms "agent", "administrative
agent" and "collateral agent" and similar terms in any Loan Document to refer to
the Administrative Agent, which terms are used for title purposes only, (ii) is
not assuming any obligation under any Loan Document other than as expressly set
forth therein or any role as agent, fiduciary or trustee of or for any Lender or
any other Secured Party and (iii)
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shall have no implied functions, responsibilities, duties, obligations or other
liabilities under any Loan Document, and each Lender hereby waives and agrees
not to assert any claim against the Administrative Agent based on the roles,
duties and legal relationships expressly disclaimed in clauses (i) through (iii)
above.
Section 10.2 Binding Effect. Each Lender agrees that (i) any action
taken by the Administrative Agent or the Required Lenders (or, if expressly
required hereby, a greater proportion of the Lenders) in accordance with the
provisions of the Loan Documents, (ii) any action taken by the Administrative
Agent in reliance upon the instructions of Required Lenders (or, where so
required, such greater proportion) and (iii) the exercise by the Administrative
Agent or the Required Lenders (or, where so required, such greater proportion)
of the powers set forth herein or therein, together with such other powers as
are reasonably incidental thereto, shall be authorized and binding upon all of
the Secured Parties.
Section 10.3 Use of Discretion. (a) No Action without Instructions.
The Administrative Agent shall not be required to exercise any discretion or
take, or to omit to take, any action, including with respect to enforcement or
collection, except any action it is required to take or omit to take (i) under
any Loan Document or (ii) pursuant to instructions from the Required Lenders
(or, where expressly required by the terms of this Agreement, a greater
proportion of the Lenders).
(b) Right Not to Follow Certain Instructions. Notwithstanding clause
(a) above, the Administrative Agent shall not be required to take, or to omit to
take, any action (i) unless, upon demand, the Administrative Agent receives an
indemnification satisfactory to it from the Lenders (or, to the extent
applicable and acceptable to the Administrative Agent, any other Secured Party)
against all Liabilities that, by reason of such action or omission, may be
imposed on, incurred by or asserted against the Administrative Agent or any
Related Person thereof or (ii) that is, in the opinion of the Administrative
Agent or its counsel, contrary to any Loan Document or applicable Requirement of
Law.
Section 10.4 Delegation of Rights and Duties. The Administrative Agent
may, upon any term or condition it specifies, delegate or exercise any of its
rights, powers and remedies under, and delegate or perform any of its duties or
any other action with respect to, any Loan Document by or through any trustee,
co-agent, employee, attorney-in-fact and any other Person (including any Secured
Party). Any such Person shall benefit from this Article X to the extent provided
by the Administrative Agent.
Section 10.5 Reliance and Liability. (a) The Administrative Agent may,
without incurring any liability hereunder, (i) treat the payee of any Note as
its holder until such Note has been assigned in accordance with Section 11.2(e),
(ii) rely on the Register to the extent set forth in Section 2.14, (iii) consult
with any of its Related Persons and, whether or not selected by it, any other
advisors, accountants and other experts (including advisors to, and accountants
and experts engaged by, any Loan Party) and (iv) rely and act upon any document
and information (including those transmitted by Electronic Transmission) and any
telephone message or conversation, in each case believed by it to be genuine and
transmitted, signed or otherwise authenticated by the appropriate parties.
(b) None of the Administrative Agent and its Related Persons shall be
liable for any action taken or omitted to be taken by any of them under or in
connection with any Loan Document, and each Lender, Holdings and the Borrower
hereby waive and shall not assert (and
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each of Holdings and the Borrower shall cause each other Loan Party to waive and
agree not to assert) any right, claim or cause of action based thereon, except
to the extent of liabilities resulting from the gross negligence or willful
misconduct of the Administrative Agent or, as the case may be, such Related
Person (each as determined in a final, non-appealable judgment by a court of
competent jurisdiction) in connection with the duties expressly set forth
herein. Without limiting the foregoing, the Administrative Agent:
(i) shall not be responsible or otherwise incur liability for any
action or omission taken in reliance upon the instructions of the Required
Lenders or for the actions or omissions of any of its Related Persons
selected with reasonable care (other than employees, officers and directors
of the Administrative Agent, when acting on behalf of the Administrative
Agent);
(ii) shall not be responsible to any Secured Party for the due
execution, legality, validity, enforceability, effectiveness, genuineness,
sufficiency or value of, or the attachment, perfection or priority of any
Lien created or purported to be created under or in connection with, any
Loan Document;
(iii) makes no warranty or representation, and shall not be
responsible, to any Secured Party for any statement, document, information,
representation or warranty made or furnished by or on behalf of any Related
Person or any Loan Party in connection with any Loan Document or any
transaction contemplated therein or any other document or information with
respect to any Loan Party, whether or not transmitted or (except for
documents expressly required under any Loan Document to be transmitted to
the Lenders) omitted to be transmitted by the Administrative Agent,
including as to completeness, accuracy, scope or adequacy thereof, or for
the scope, nature or results of any due diligence performed by the
Administrative Agent in connection with the Loan Documents; and
(iv) shall not have any duty to ascertain or to inquire as to the
performance or observance of any provision of any Loan Document, whether
any condition set forth in any Loan Document is satisfied or waived, as to
the financial condition of any Loan Party or as to the existence or
continuation or possible occurrence or continuation of any Default or Event
of Default and shall not be deemed to have notice or knowledge of such
occurrence or continuation unless it has received a notice from the
Borrower, any Lender describing such Default or Event of Default clearly
labeled "notice of default" (in which case the Administrative Agent shall
promptly give notice of such receipt to all Lenders);
and, for each of the items set forth in clauses (i) through (iv) above, each
Lender, Holdings and the Borrower hereby waives and agrees not to assert (and
each of Holdings and the Borrower shall cause each other Loan Party to waive and
agree not to assert) any right, claim or cause of action it might have against
the Administrative Agent based thereon.
Section 10.6 Administrative Agent Individually. The Administrative
Agent and its Affiliates may make loans and other extensions of credit to,
acquire Stock and Stock Equivalents of, engage in any kind of business with, any
Loan Party or Affiliate thereof as though it were not acting as Administrative
Agent and may receive separate fees and other payments therefor. To the extent
the Administrative Agent or any of its Affiliates makes any Loan or otherwise
becomes a Lender hereunder, it shall have and may exercise the same rights and
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powers hereunder and shall be subject to the same obligations and liabilities as
any other Lender and the terms "Lender", "Term Loan Lender" and "Required
Lender" and any similar terms shall, except where otherwise expressly provided
in any Loan Document, include, without limitation, the Administrative Agent or
such Affiliate, as the case may be, in its individual capacity as Lender or as
one of the Required Lenders, respectively.
Section 10.7 Lender Credit Decision. Each Lender acknowledges that it
shall, independently and without reliance upon the Administrative Agent, any
Lender or any of their Related Persons or upon any document (including the
Disclosure Documents) solely or in part because such document was transmitted by
the Administrative Agent or any of its Related Persons, conduct its own
independent investigation of the financial condition and affairs of each Loan
Party and make and continue to make its own credit decisions in connection with
entering into, and taking or not taking any action under, any Loan Document or
with respect to any transaction contemplated in any Loan Document, in each case
based on such documents and information as it shall deem appropriate. Except for
documents expressly required by any Loan Document to be transmitted by the
Administrative Agent to the Lenders, the Administrative Agent shall not have any
duty or responsibility to provide any Lender with any credit or other
information concerning the business, prospects, operations, property, financial
and other condition or creditworthiness of any Loan Party or any Affiliate of
any Loan Party that may come into the possession of the Administrative Agent or
any of its Related Persons.
Section 10.8 Expenses; Indemnities. (a) Each Lender agrees to
reimburse the Administrative Agent and each of its Related Persons (to the
extent not reimbursed by any Loan Party) promptly upon demand for such Lender's
Pro Rata Share with respect to the Term Loan Facility of any costs and expenses
(including fees, charges and disbursements of financial, legal and other
advisors and Other Taxes paid in the name of, or on behalf of, any Loan Party)
that may be incurred by the Administrative Agent or any of its Related Persons
in connection with the preparation, syndication, execution, delivery,
administration, modification, consent, waiver or enforcement (whether through
negotiations, through any work-out, bankruptcy, restructuring or other legal or
other proceeding or otherwise) of, or legal advice in respect of its rights or
responsibilities under, any Loan Document.
(b) Each Lender further agrees to indemnify the Administrative Agent
and each of its Related Persons (to the extent not reimbursed by any Loan
Party), from and against such Lender's aggregate Pro Rata Share with respect to
the Term Loan Facility of the Liabilities (including taxes, interests and
penalties imposed for not properly withholding or backup withholding on payments
made to on or for the account of any Lender) that may be imposed on, incurred by
or asserted against the Administrative Agent or any of its Related Persons in
any matter relating to or arising out of, in connection with or as a result of
any Loan Document, any Related Document or any other act, event or transaction
related, contemplated in or attendant to any such document, or, in each case,
any action taken or omitted to be taken by the Administrative Agent or any of
its Related Persons under or with respect to any of the foregoing; provided,
however, that no Lender shall be liable to the Administrative Agent or any of
its Related Persons to the extent such liability has resulted primarily from the
gross negligence or willful misconduct of the Administrative Agent or, as the
case may be, such Related Person, as determined by a court of competent
jurisdiction in a final non-appealable judgment or order.
Section 10.9 Resignation of Administrative Agent. (a) The
Administrative Agent may resign at any time by delivering notice of such
resignation to the Lenders and the Borrower, effective on the date set forth in
such notice or, if no such date is set forth therein, upon
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the date such notice shall be effective. If the Administrative Agent delivers
any such notice, the Required Lenders shall have the right to appoint a
successor Administrative Agent. If, within 30 days after the retiring
Administrative Agent having given notice of resignation, no successor
Administrative Agent has been appointed by the Required Lenders and has accepted
such appointment, then the retiring Administrative Agent may, on behalf of the
Lenders, appoint a successor Administrative Agent from among the Lenders. Each
appointment under this clause (a) shall be subject to the prior consent of the
Borrower, which may not be unreasonably withheld but shall not be required
during the continuance of an Event of Default.
(b) Effective immediately upon its resignation, (i) the retiring
Administrative Agent shall be discharged from its duties and obligations under
the Loan Documents, (ii) the Lenders shall assume and perform all of the duties
of the Administrative Agent until a successor Administrative Agent shall have
accepted a valid appointment hereunder, (iii) the retiring Administrative Agent
and its Related Persons shall no longer have the benefit of any provision of any
Loan Document other than with respect to any actions taken or omitted to be
taken while such retiring Administrative Agent was, or because such
Administrative Agent had been, validly acting as Administrative Agent under the
Loan Documents and (iv) subject to its rights under Section 10.3, the retiring
Administrative Agent shall take such action as may be reasonably necessary to
assign to the successor Administrative Agent its rights as Administrative Agent
under the Loan Documents. Effective immediately upon its acceptance of a valid
appointment as Administrative Agent, a successor Administrative Agent shall
succeed to, and become vested with, all the rights, powers, privileges and
duties of the retiring Administrative Agent under the Loan Documents.
Section 10.10 Release of Collateral or Guarantors. Each Lender hereby
consents to the release and hereby directs the Administrative Agent to release
(or, in the case of clause (b)(ii) below, release or subordinate) the following:
(a) any Subsidiary of the Borrower from its guaranty of any Obligation
of any Loan Party if all of the Securities of such Subsidiary owned by any Group
Member are Sold in a Sale permitted under the Loan Documents (including pursuant
to a waiver or consent), to the extent that, after giving effect to such Sale,
such Subsidiary would not be required to guaranty any Obligations pursuant to
Section 7.10; and
(b) any Lien held by the Administrative Agent for the benefit of any
of the Secured Parties against (i) any Collateral that is Sold by a Loan Party
in a Sale permitted by the Loan Documents (including pursuant to a valid waiver
or consent), to the extent all Liens required to be granted in such Collateral
pursuant to Section 7.10 after giving effect to such Sale have been granted,
(ii) any property subject to a Lien permitted hereunder in reliance upon Section
8.2(d) or (e) and (iii) all of the Collateral and all Loan Parties, upon (A)
termination of the Term Loan Commitments, (B) payment and satisfaction in full
of all Loans and all other Obligations that the Administrative Agent has been
notified in writing are then due and payable by the holder of such Obligation,
(C) deposit of cash collateral with respect to all contingent Obligations (other
than contingent indemnification obligations as to which no claim has been
asserted) in amounts and on terms and conditions and with parties satisfactory
to the Administrative Agent and each Indemnitee that is owed such Obligations
and (D) to the extent requested by the Administrative Agent, receipt by the
Secured Parties of liability releases from the Loan Parties each in form and
substance acceptable to the Administrative Agent.
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Each Lender hereby directs the Administrative Agent, and the Administrative
Agent hereby agrees, upon receipt of reasonable advance notice from the
Borrower, to execute and deliver or file such documents and to perform other
actions reasonably necessary to release the guaranties and Liens when and as
directed in this Section 10.10.
Section 10.11 Additional Secured Parties. The benefit of the
provisions of the Loan Documents directly relating to the Collateral or any Lien
granted thereunder shall extend to and be available to any Secured Party that is
not a Lender as long as, by accepting such benefits, such Secured Party agrees,
as among the Administrative Agent and all other Secured Parties, that such
Secured Party is bound by (and, if requested by the Administrative Agent, shall
confirm such agreement in a writing in form and substance acceptable to the
Administrative Agent) this Article X, Section 11.8 (Right of Setoff), Section
11.9 (Sharing of Payments) and Section 11.20 (Confidentiality) and the decisions
and actions of the Administrative Agent and the Required Lenders (or, where
expressly required by the terms of this Agreement, a greater proportion of the
Lenders) to the same extent a Lender is bound; provided, however, that,
notwithstanding the foregoing, (a) such Secured Party shall be bound by Section
10.8 only to the extent of Liabilities, costs and expenses with respect to or
otherwise relating to the Collateral held for the benefit of such Secured Party,
in which case the obligations of such Secured Party thereunder shall not be
limited by any concept of Pro Rata Share or similar concept, (b) except as set
forth specifically herein, each of the Administrative Agent and the Lenders
shall be entitled to act at its sole discretion, without regard to the interest
of such Secured Party, regardless of whether any Obligation to such Secured
Party thereafter remains outstanding, is deprived of the benefit of the
Collateral, becomes unsecured or is otherwise affected or put in jeopardy
thereby, and without any duty or liability to such Secured Party or any such
Obligation and (c) except as set forth specifically herein, such Secured Party
shall not have any right to be notified of, consent to, direct, require or be
heard with respect to, any action taken or omitted in respect of the Collateral
or under any Loan Document.
Section 10.12 Titles. Notwithstanding anything else to the contrary in
this Agreement or any other Loan Document, no party hereto designated as a
documentation agent, a syndication agent, an arranger or a bookrunner shall have
any duties or responsibilities under this Agreement or any other Loan Document
nor any fiduciary duty to any Lender or any other Secured Party, and no implied
covenants, functions, responsibilities, duties obligations or liabilities shall
be read into this Agreement or otherwise exist against any such documentation
agent, syndication agent, arranger or bookrunner, in such capacity.
ARTICLE XI
MISCELLANEOUS
Section 11.1 Amendments, Waivers, Etc. (a) No amendment or waiver of
any provision of any Loan Document (other than the Fee Letter, the Control
Agreements and any other Loan Document executed pursuant to any of the
foregoing) and no consent to any departure by any Loan Party therefrom shall be
effective unless the same shall be in writing and signed (1) in the case of an
amendment, consent or waiver to cure any ambiguity, omission, defect or
inconsistency or granting a new Lien for the benefit of the Secured Parties or
extending an existing Lien over additional property, by the Administrative Agent
and the Borrower, (2) in the case of any other waiver or consent, by the
Required Lenders (or by the Administrative Agent with the consent of the
Required Lenders), and (3) in the case of any other amendment, by the
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Required Lenders (or by the Administrative Agent with the consent of the
Required Lenders) and the Borrower; provided, however, that no amendment,
consent or waiver described in clause (2) or (3) above shall, unless in writing
and signed by each Lender directly affected thereby (or by the Administrative
Agent with the consent of such Lender), in addition to any other Person the
signature of which is otherwise required pursuant to any Loan Document, do any
of the following:
(i) waive any condition specified in Section 3.1, except any
condition referring to any other provision of any Loan Document;
(ii) increase the Term Loan Commitment of such Lender or subject
such Lender to any additional obligation;
(iii) reduce (including through release, forgiveness, assignment
or otherwise) (A) the principal amount of, the interest rate on, or any
obligation of the Borrower to repay (whether or not on a fixed date), any
outstanding Loan owing to such Lender, or (B) any fee or accrued interest
payable to such Lender or; provided, however, that this clause (iii) does
not apply to (x) any change to any provision increasing any interest rate
or fee during the continuance of an Event of Default or to any payment of
any such increase or (y) any modification to any financial covenant set
forth in Article V or in any definition set forth therein or principally
used therein;
(iv) waive or postpone any scheduled maturity date or other
scheduled date fixed for the payment, in whole or in part, of principal of
or interest on any Loan or fee owing to such Lender or for the reduction of
such Lender's Commitment; provided, however, that this clause (iv) does not
apply to any change to mandatory prepayments, including those required
under Section 2.8, or to the application of any payment, including as set
forth in Section 2.12;
(v) except as provided in Section 10.10, release all or
substantially all of the Collateral, the Borrower or any Guarantor from its
guaranty of any Obligation of the Borrower or consent to the assignment or
transfer by the Borrower of its rights or obligations under the Loan
Documents;
(vi) reduce or increase the proportion of Lenders required for
the Lenders (or any subset thereof) to take any action hereunder or change
the definition of the terms "Required Lenders", "Pro Rata Share" or "Pro
Rata Outstandings"; or
(vii) amend Section 10.10 (Release of Collateral or Guarantor),
Section 11.9 (Sharing of Payments) or this Section 11.1;
and provided, further, that no amendment, waiver or consent shall affect the
rights or duties under any Loan Document of, or any payment to, the
Administrative Agent (or otherwise modify any provision of Article X or the
application thereof), or any SPV that has been granted an option pursuant to
Section 11.2(f) unless in writing and signed by the Administrative Agent or, as
the case may be, such SPV in addition to any signature otherwise required and
(z) the consent of the Borrower shall not be required to change any order of
priority set forth in Section 2.12.
(b) Each waiver or consent under any Loan Document shall be effective
only in the specific instance and for the specific purpose for which it was
given. No notice to or
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demand on any Loan Party shall entitle any Loan Party to any notice or demand in
the same, similar or other circumstances. No failure on the part of any Secured
Party to exercise, and no delay in exercising, any right hereunder shall operate
as a waiver thereof, nor shall any single or partial exercise of any such right
preclude any other or further exercise thereof or the exercise of any other
right.
Section 11.2 Assignments and Participations; Binding Effect. (a)
Binding Effect. This Agreement shall become effective when it shall have been
executed by Holdings, the Borrower and the Administrative Agent and when the
Administrative Agent shall have been notified by each Lender that such Lender
has executed it. Thereafter, it shall be binding upon and inure to the benefit
of, but only to the benefit of, Holdings, the Borrower (in each case except for
Article X), the Administrative Agent, each Lender and, to the extent provided in
Section 10.11, each other Indemnitee and Secured Party and, in each case, their
respective successors and permitted assigns. Except as expressly provided in any
Loan Document (including in Section 10.9), none of Holdings, the Borrower, or
the Administrative Agent shall have the right to assign any rights or
obligations hereunder or any interest herein.
(b) Right to Assign. Each Lender may sell, transfer, negotiate or
assign all or a portion of its rights and obligations hereunder (including all
or a portion of its Term Loan Commitments and its rights and obligations with
respect to Loans) to (each an "Eligible Assignee"): (i) any existing Lender,
(ii) any Affiliate or Approved Fund of any existing Lender or (iii) any other
Person acceptable (which acceptance shall not be unreasonably withheld or
delayed) to the Administrative Agent and, as long as no Default or Event of
Default is continuing, the Borrower; provided, however, that (x) such Sales must
be ratable among the obligations owing to and owed by such Lender with respect
to a Term Loan Facility and (y) for each Term Loan Facility, the aggregate
outstanding principal amount (determined as of the effective date of the
applicable Assignment) of the Loans, and Term Loan Commitments subject to any
such Sale shall be in a minimum amount of $1,000,000, unless such Sale is made
to an existing Lender or an Affiliate or Approved Fund of any existing Lender,
is of the assignor's (together with its Affiliates and Approved Funds) entire
interest in the Term Loan Facility or is made with the prior consent of the
Borrower and the Administrative Agent.
(c) Procedure. The parties to each Sale made in reliance on clause (b)
above (other than those described in clause (e) or (f) below) shall execute and
deliver to the Administrative Agent an Assignment via an electronic settlement
system designated by the Administrative Agent (or if previously agreed with the
Administrative Agent, via a manual execution and delivery of the assignment)
evidencing such Sale, together with any existing Note subject to such Sale (or
any affidavit of loss therefor acceptable to the Administrative Agent), any tax
forms required to be delivered pursuant to Section 2.17(f) and payment of an
assignment fee in the amount of $3,500, provided that (1) if a Sale by a Lender
is made to an Affiliate or an Approved Fund of such assigning Lender, then no
assignment fee shall be due in connection with such Sale, and (2) if a Sale by a
Lender is made to an assignee that is not an Affiliate or Approved Fund of such
assignor Lender, and concurrently to one or more Affiliates or Approved Funds of
such assignee, then only one assignment fee of $3,500 shall be due in connection
with such Sale. Upon receipt of all the foregoing, and conditioned upon such
receipt and, if such assignment is made in accordance with Section 11.2(b)(iii),
upon the Administrative Agent (and the Borrower, if applicable) consenting to
such Assignment, from and after the effective date specified in such Assignment,
the Administrative Agent shall record or cause to be recorded in the Register
the information contained in such Assignment.
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(d) Effectiveness. Subject to the recording of an Assignment by the
Administrative Agent in the Register pursuant to Section 2.14(b), (i) the
assignee thereunder shall become a party hereto and, to the extent that rights
and obligations under the Loan Documents have been assigned to such assignee
pursuant to such Assignment, shall have the rights and obligations of a Lender,
(ii) any applicable Note shall be transferred to such assignee through such
entry and (iii) the assignor thereunder shall, to the extent that rights and
obligations under this Agreement have been assigned by it pursuant to such
Assignment, relinquish its rights (except for those surviving the termination of
the Term Loan Commitments and the payment in full of the Obligations) and be
released from its obligations under the Loan Documents, other than those
relating to events or circumstances occurring prior to such assignment (and, in
the case of an Assignment covering all or the remaining portion of an assigning
Lender's rights and obligations under the Loan Documents, such Lender shall
cease to be a party hereto except that each Lender agrees to remain bound by
Article X, Section 11.8 (Right of Setoff) and Section 11.9 (Sharing of Payments,
Etc.) to the extent provided in Section 10.11 (Additional Secured Parties)).
(e) Grant of Security Interests. In addition to the other rights
provided in this Section 11.2, each Lender may grant a security interest in, or
otherwise assign as collateral, any of its rights under this Agreement, whether
now owned or hereafter acquired (including rights to payments of principal or
interest on the Loans), to (A) any federal reserve bank (pursuant to Regulation
A of the Federal Reserve Board), without notice to the Administrative Agent or
(B) any holder of, or trustee for the benefit of the holders of, such Lender's
Securities by notice to the Administrative Agent; provided, however, that no
such holder or trustee, whether because of such grant or assignment or any
foreclosure thereon (unless such foreclosure is made through an assignment in
accordance with clause (b) above), shall be entitled to any rights of such
Lender hereunder and no such Lender shall be relieved of any of its obligations
hereunder.
(f) Participants and SPVs. In addition to the other rights provided in
this Section 11.2, each Lender may, (x) with notice to the Administrative Agent,
grant to an SPV the option to make all or any part of any Loan that such Lender
would otherwise be required to make hereunder (and the exercise of such option
by such SPV and the making of Loans pursuant thereto shall satisfy the
obligation of such Lender to make such Loans hereunder) and such SPV may assign
to such Lender the right to receive payment with respect to any Obligation and
(y) without notice to or consent from the Administrative Agent or the Borrower,
sell participations to one or more Persons in or to all or a portion of its
rights and obligations under the Loan Documents (including all its rights and
obligations with respect to the Term Loans); provided, however, that, whether as
a result of any term of any Loan Document or of such grant or participation, (i)
no such SPV or participant shall have a commitment, or be deemed to have made an
offer to commit, to make Loans hereunder, and, except as provided in the
applicable option agreement, none shall be liable for any obligation of such
Lender hereunder, (ii) such Lender's rights and obligations, and the rights and
obligations of the Loan Parties and the Secured Parties towards such Lender,
under any Loan Document shall remain unchanged and each other party hereto shall
continue to deal solely with such Lender, which shall remain the holder of the
Obligations in the Register, except that (A) each such participant and SPV shall
be entitled to the benefit of Sections 2.16 (Breakage Costs; Increased Costs;
Capital Requirements) and 2.17 (Taxes), but only to the extent such participant
or SPV delivers the tax forms such Lender is required to collect pursuant to
Section 2.17(f) and then only to the extent of any amount to which such Lender
would be entitled in the absence of any such grant or participation and (B) each
such SPV may receive other payments that would otherwise be made to such Lender
with respect to Loans funded by such SPV to the extent provided in the
applicable option agreement and set forth
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in a notice provided to the Administrative Agent by such SPV and such Lender,
provided, however, that in no case (including pursuant to clause (A) or (B)
above) shall an SPV or participant have the right to enforce any of the terms of
any Loan Document, and (iii) the consent of such SPV or participant shall not be
required (either directly, as a restraint on such Lender's ability to consent
hereunder or otherwise) for any amendments, waivers or consents with respect to
any Loan Document or to exercise or refrain from exercising any powers or rights
such Lender may have under or in respect of the Loan Documents (including the
right to enforce or direct enforcement of the Obligations), except for those
described in clauses (iii) and (iv) of Section 11.1(a) with respect to amounts,
or dates fixed for payment of amounts, to which such participant or SPV would
otherwise be entitled and, in the case of participants, except for those
described in Section 11.1(a)(v) (or amendments, consents and waivers with
respect to Section 10.10 to release all or substantially all of the Collateral).
No party hereto shall institute (and each of the Borrower and Holdings shall
cause each other Loan Party not to institute) against any SPV grantee of an
option pursuant to this clause (f) any bankruptcy, reorganization, insolvency,
liquidation or similar proceeding, prior to the date that is one year and one
day after the payment in full of all outstanding commercial paper of such SPV;
provided, however, that each Lender having designated an SPV as such agrees to
indemnify each Indemnitee against any Liability that may be incurred by, or
asserted against, such Indemnitee as a result of failing to institute such
proceeding (including a failure to be reimbursed by such SPV for any such
Liability). The agreement in the preceding sentence shall survive the
termination of the Term Loan Commitments and the payment in full of the
Obligations.
Section 11.3 Costs and Expenses. Any action taken by any Loan Party
under or with respect to any Loan Document, even if required under any Loan
Document or at the request of any Secured Party, shall be at the expense of such
Loan Party, and no Secured Party shall be required under any Loan Document to
reimburse any Loan Party or Group Member therefor except as expressly provided
therein. In addition, the Borrower agrees to pay or reimburse upon demand (a)
the Administrative Agent for all reasonable out-of-pocket costs and expenses
incurred by it or any of its Related Persons in connection with the
investigation, development, preparation, negotiation, syndication, execution,
interpretation or administration of, any modification of any term of or
termination of, any Loan Document, any commitment or proposal letter therefor,
any other document prepared in connection therewith or the consummation and
administration of any transaction contemplated therein (including periodic
audits in connection therewith and environmental audits and assessments), in
each case including the reasonable fees, charges and disbursements of legal
counsel to the Administrative Agent or such Related Persons, fees, costs and
expenses incurred in connection with Intralinks(R) or any other E-System and
allocated to the Term Loan Facility by the Administrative Agent in its sole
discretion and fees, charges and disbursements of the auditors, appraisers,
printers and other of their Related Persons retained by or on behalf of any of
them or any of their Related Persons, (b) the Administrative Agent for all
reasonable costs and expenses incurred by it or any of its Related Persons in
connection with internal audit reviews, field examinations and Collateral
examinations (which shall be reimbursed, in addition to the out-of-pocket costs
and expenses of such examiners, at the per diem rate per individual charged by
the Administrative Agent for its examiners) and (c) each of the Administrative
Agent, its Related Persons, and each Lender for all costs and expenses incurred
in connection with (i) any refinancing or restructuring of the credit
arrangements provided hereunder in the nature of a "work-out", (ii) the
enforcement or preservation of any right or remedy under any Loan Document, any
Obligation, with respect to the Collateral or any other related right or remedy
or (iii) the commencement, defense, conduct of, intervention in, or the taking
of any other action with respect to, any proceeding (including
89
any bankruptcy or insolvency proceeding) related to any Group Member, Loan
Document, Obligation or Related Transaction (or the response to and preparation
for any subpoena or request for document production relating thereto), including
fees and disbursements of counsel (including allocated costs of internal
counsel).
Section 11.4 Indemnities. (a) The Borrower agrees to indemnify, hold
harmless and defend the Administrative Agent, each Lender and each of their
respective Related Persons (each such Person being an "Indemnitee") from and
against all Liabilities (including brokerage commissions, fees and other
compensation) that may be imposed on, incurred by or asserted against any such
Indemnitee in any matter relating to or arising out of, in connection with or as
a result of (i) any Loan Document, any Related Document, any Disclosure
Document, any Obligation (or the repayment thereof), any Related Transaction, or
any securities filing of, or with respect to, any Group Member, (ii) any
commitment letter, proposal letter or term sheet with any Person or any
Contractual Obligation, arrangement or understanding with any broker, finder or
consultant, in each case entered into by or on behalf of the Target, any Group
Member or any Affiliate of any of them in connection with any of the foregoing
and any Contractual Obligation entered into in connection with any E-Systems or
other Electronic Transmissions, (iii) any actual or prospective investigation,
litigation or other proceeding, whether or not brought by any such Indemnitee or
any of its Related Persons, any holders of Securities or creditors (and
including attorneys' fees in any case), whether or not any such Indemnitee,
Related Person, holder or creditor is a party thereto, and whether or not based
on any securities or commercial law or regulation or any other Requirement of
Law or theory thereof, including common law, equity, contract, tort or
otherwise, or (iv) any other act, event or transaction related, contemplated in
or attendant to any of the foregoing (collectively, the "Indemnified Matters");
provided, however, that the Borrower shall not have any liability under this
Section 11.4 to any Indemnitee with respect to any Indemnified Matter, and no
Indemnitee shall have any liability with respect to any Indemnified Matter other
than (to the extent otherwise liable), to the extent such liability has resulted
from the gross negligence or willful misconduct of such Indemnitee, as
determined by a court of competent jurisdiction in a final non-appealable
judgment or order. Furthermore, each of Holdings and the Borrower waives and
agrees not to assert against any Indemnitee, and shall cause each other Loan
Party to waive and not assert against any Indemnitee, any right of contribution
with respect to any Liabilities that may be imposed on, incurred by or asserted
against any Related Person.
(b) Without limiting the foregoing, "Indemnified Matters" includes all
Environmental Liabilities, including those arising from, or otherwise involving,
any property of any Related Person or any actual, alleged or prospective damage
to property or natural resources or harm or injury alleged to have resulted from
any Release of Hazardous Materials on, upon or into such property or natural
resource or any property on or contiguous to any real property of any Related
Person, whether or not, with respect to any such Environmental Liabilities, any
Indemnitee is a mortgagee pursuant to any leasehold mortgage, a mortgagee in
possession, the successor-in-interest to any Related Person or the owner, lessee
or operator of any property of any Related Person through any foreclosure
action, in each case except to the extent such Environmental Liabilities (i) are
incurred solely following foreclosure by any Secured Party or following any
Secured Party having become the successor-in-interest to any Loan Party and (ii)
are attributable solely to acts of such Indemnitee.
Section 11.5 Survival. Any indemnification or other protection
provided to any Indemnitee pursuant to any Loan Document (including pursuant to
Section 2.17 (Taxes),
90
Section 2.16 (Breakage Costs; Increased Costs; Capital Requirements), Article X
(The Administrative Agent), Section 11.3 (Costs and Expenses), Section 11.4
(Indemnities) or this Section 11.5) and all representations and warranties made
in any Loan Document shall (A) survive the termination of the Term Loan
Commitments and the payment in full of other Obligations and (B) inure to the
benefit of any Person that at any time held a right thereunder (as an Indemnitee
or otherwise) and, thereafter, its successors and permitted assigns.
Section 11.6 Limitation of Liability for Certain Damages. In no event
shall any Indemnitee be liable on any theory of liability for any special,
indirect, consequential or punitive damages (including any loss of profits,
business or anticipated savings). Each of Holdings and the Borrower hereby
waives, releases and agrees (and shall cause each other Loan Party to waive,
release and agree) not to xxx upon any such claim for any special, indirect,
consequential or punitive damages, whether or not accrued and whether or not
known or suspected to exist in its favor.
Section 11.7 Lender-Creditor Relationship. The relationship between
the Lenders and the Administrative Agent, on the one hand, and the Loan Parties,
on the other hand, is solely that of lender and creditor. No Secured Party has
any fiduciary relationship or duty to any Loan Party arising out of or in
connection with, and there is no agency, tenancy or joint venture relationship
between the Secured Parties and the Loan Parties by virtue of, any Loan Document
or any transaction contemplated therein.
Section 11.8 Right of Setoff. Each of the Administrative Agent, each
Lender and each Affiliate (including each branch office thereof) of any of them
is hereby authorized, without notice or demand (each of which is hereby waived
by Holdings and the Borrower), at any time and from time to time during the
continuance of any Event of Default and to the fullest extent permitted by
applicable Requirements of Law, to set off and apply any and all deposits
(whether general or special, time or demand, provisional or final) at any time
held and other Indebtedness, claims or other obligations at any time owing by
the Administrative Agent, such Lender or any of their respective Affiliates to
or for the credit or the account of Holdings or the Borrower against any
Obligation of any Loan Party now or hereafter existing, whether or not any
demand was made under any Loan Document with respect to such Obligation and even
though such Obligation may be unmatured. Each of the Administrative Agent and
each Lender agrees promptly to notify the Borrower and the Administrative Agent
after any such setoff and application made by such Lender or its Affiliates;
provided, however, that the failure to give such notice shall not affect the
validity of such setoff and application. The rights under this Section 11.8 are
in addition to any other rights and remedies (including other rights of setoff)
that the Administrative Agent, the Lenders and their Affiliates and other
Secured Parties may have.
Section 11.9 Sharing of Payments, Etc. If any Lender, directly or
through an Affiliate or branch office thereof, obtains any payment of any
Obligation of any Loan Party (whether voluntary, involuntary or through the
exercise of any right of setoff or the receipt of any Collateral or "proceeds"
(as defined under the applicable UCC) of Collateral) other than pursuant to
Sections 2.16 (Breakage Costs; Increased Costs; Capital Requirements), 2.17
(Taxes) and 2.18 (Substitution of Lenders) and such payment exceeds the amount
such Lender would have been entitled to receive if all payments had gone to, and
been distributed by, the Administrative Agent in accordance with the provisions
of the Loan Documents, such Lender shall purchase for cash from other Secured
Parties such participations in their Obligations as necessary for such Lender to
share such excess payment with such Secured Parties to ensure such payment is
applied as though it had been received by the Administrative Agent and applied
in accordance with this
91
Agreement (or, if such application would then be at the discretion of the
Borrower, applied to repay the Obligations in accordance herewith); provided,
however, that (a) if such payment is rescinded or otherwise recovered from such
Lender in whole or in part, such purchase shall be rescinded and the purchase
price therefor shall be returned to such Lender without interest and (b) such
Lender shall, to the fullest extent permitted by applicable Requirements of Law,
be able to exercise all its rights of payment (including the right of setoff)
with respect to such participation as fully as if such Lender were the direct
creditor of the Borrower in the amount of such participation.
Section 11.10 Marshaling; Payments Set Aside. No Secured Party shall
be under any obligation to marshal any property in favor of any Loan Party or
any other party or against or in payment of any Obligation. To the extent that
any Secured Party receives a payment from the Borrower, from the proceeds of the
Collateral, from the exercise of its rights of setoff, any enforcement action or
otherwise, and such payment is subsequently, in whole or in part, invalidated,
declared to be fraudulent or preferential, set aside or required to be repaid to
a trustee, receiver or any other party, then to the extent of such recovery, the
obligation or part thereof originally intended to be satisfied, and all Liens,
rights and remedies therefor, shall be revived and continued in full force and
effect as if such payment had not occurred.
Section 11.11 Notices. (a) Addresses. All notices, demands, requests,
directions and other communications required or expressly authorized to be made
by this Agreement shall, whether or not specified to be in writing but unless
otherwise expressly specified to be given by any other means, be given in
writing and (i) addressed (A) if to Holdings or the Borrower, to Inverness
Medical Innovations, Inc., 00 Xxxxxx Xxxx, Xxxxx 000, Xxxxxxx, Xxxxxxxxxxxxx
00000, Attention: Xxxxx Xxxxxx, Chief Financial Officer, Tel: (000) 000-0000,
Fax: (000) 000-0000, with copies to Inverness Medical Innovations, Inc., 00
Xxxxxx Xxxx, Xxxxx 000, Xxxxxxx, Xxxxxxxxxxxxx 00000, Attention: General
Counsel, Tel: (000) 000-0000, Fax: (000) 000-0000, and Xxxxx Xxxx LLP, Seaport
World Trade Center West, 000 Xxxxxxx Xxxxxxxxx, Xxxxxx, Xxxxxxxxxxxxx
00000-0000, Attention: Xxxxxxx Xxxxxxxxx, Esq., Tel: (000) 000.0000, Fax: (617)
000-0000, (B) if to the Administrative Agent, to General Electric Capital
Corporation, 0 Xxxxxxxx Xxxxx Xxxxxx, xxxxx 000, Xxxxxxxx, XX 00000, Attention:
Inverness Account Manager, Tel: (000) 000-0000, Fax: (000) 000-0000, with a copy
to Paul, Hastings, Xxxxxxxx & Xxxxxx LLP, 00 Xxxx 00xx Xxxxxx, Xxx Xxxx, Xxx
Xxxx 00000, Attention: Xxxxx X. Xxxxxxxx, Tel: (000) 000-0000, Fax: (212)
000-0000, and (C) otherwise to the party to be notified at its address specified
opposite its name on Schedule II or on the signature page of any applicable
Assignment, (ii) posted to Intralinks(R) (to the extent such system is available
and set up by or at the direction of the Administrative Agent prior to posting)
in an appropriate location by uploading such notice, demand, request, direction
or other communication to xxx.xxxxxxxxxx.xxx, faxing it to 000-000-0000 with an
appropriate bar-coded fax coversheet or using such other means of posting to
Intralinks(R) as may be available and reasonably acceptable to the
Administrative Agent prior to such posting, (iii) posted to any other E-System
set up by or at the direction of the Administrative Agent in an appropriate
location or (iv) addressed to such other address as shall be notified in writing
(A) in the case of the Borrower and the Administrative Agent, to the other
parties hereto and (B) in the case of all other parties, to the Borrower and the
Administrative Agent. Transmission by electronic mail (including E-Fax, even if
transmitted to the fax numbers set forth in clause (i) above) shall not be
sufficient or effective to transmit any such notice under this clause (a) unless
such transmission is an available means to post to any E-System.
92
(b) Effectiveness. All communications described in clause (a) above
and all other notices, demands, requests and other communications made in
connection with this Agreement shall be effective and be deemed to have been
received (i) if delivered by hand, upon personal delivery, (ii) if delivered by
overnight courier service, one Business Day after delivery to such courier
service, (iii) if delivered by mail, when deposited in the mails, (iv) if
delivered by facsimile (other than to post to an E-System pursuant to clause
(a)(ii) or (a)(iii) above), upon sender's receipt of confirmation of proper
transmission, and (v) if delivered by posting to any E-System (including any
facsimile so posted), on the later of the date of such posting in an appropriate
location and the date access to such posting (and notice of such access) is
given to the recipient thereof in accordance with the standard procedures
applicable to such E-System; provided, however, that no communications to the
Administrative Agent pursuant to Article II or Article X shall be effective
until received by the Administrative Agent.
Section 11.12 Electronic Transmissions. (a) Authorization. Subject to
the provisions of Section 11.11(a), each of the Administrative Agent, the
Borrower, the Lenders and each of their Related Persons is authorized (but not
required) to transmit, post or otherwise make or communicate, in its sole
discretion, Electronic Transmissions in connection with any Loan Document and
the transactions contemplated therein. Each of Holdings, the Borrower and each
Secured Party hereby acknowledges and agrees, and each of Holdings and the
Borrower shall cause each other Group Member to acknowledge and agree, that the
use of Electronic Transmissions is not necessarily secure and that there are
risks associated with such use, including risks of interception, disclosure and
abuse and each indicates it assumes and accepts such risks by hereby authorizing
the transmission of Electronic Transmissions.
(b) Signatures. Subject to the provisions of Section 11.11(a), (i)(A)
no posting to any E-System shall be denied legal effect merely because it is
made electronically, (B) each E-Signature on any such posting shall be deemed
sufficient to satisfy any requirement for a "signature" and (C) each such
posting shall be deemed sufficient to satisfy any requirement for a "writing",
in each case including pursuant to any Loan Document, any applicable provision
of any UCC, the federal Uniform Electronic Transactions Act, the Electronic
Signatures in Global and National Commerce Act and any substantive or procedural
Requirement of Law governing such subject matter, (ii) each such posting that is
not readily capable of bearing either a signature or a reproduction of a
signature may be signed, and shall be deemed signed, by attaching to, or
logically associating with such posting, an E-Signature, upon which each Secured
Party and Loan Party may rely and assume the authenticity thereof, (iii) each
such posting containing a signature, a reproduction of a signature or an
E-Signature shall, for all intents and purposes, have the same effect and weight
as a signed paper original and (iv) each party hereto or beneficiary hereto
agrees not to contest the validity or enforceability of any posting on any
E-System or E-Signature on any such posting under the provisions of any
applicable Requirement of Law requiring certain documents to be in writing or
signed; provided, however, that nothing herein shall limit such party's or
beneficiary's right to contest whether any posting to any E-System or
E-Signature has been altered after transmission.
(c) Separate Agreements. All uses of an E-System shall be governed by
and subject to, in addition to Section 11.11 and this Section 11.12, separate
terms and conditions posted or referenced in such E-System and related
Contractual Obligations executed by Secured Parties and Group Members in
connection with the use of such E-System.
(d) Limitation of Liability. All E-Systems and Electronic
Transmissions shall be provided "as is" and "as available". None of
Administrative Agent or any of its Related
93
Persons warrants the accuracy, adequacy or completeness of any E-Systems or
Electronic Transmission, and each disclaims all liability for errors or
omissions therein. No warranty of any kind is made by the Administrative Agent
or any of its Related Persons in connection with any E-Systems or Electronic
Transmission, including any warranty of merchantability, fitness for a
particular purpose, non-infringement of third-party rights or freedom from
viruses or other code defects. Each of Holdings, the Borrower and each Secured
Party agrees (and each of Holdings and the Borrower shall cause each other Loan
Party to agree) that the Administrative Agent has no responsibility for
maintaining or providing any equipment, software, services or any testing
required in connection with any Electronic Transmission or otherwise required
for any E-System.
Section 11.13 Governing Law. This Agreement, each other Loan Document
that does not expressly set forth its applicable law, and the rights and
obligations of the parties hereto and thereto shall be governed by, and
construed and interpreted in accordance with, the law of the State of New York.
Section 11.14 Jurisdiction. (a) Submission to Jurisdiction. Any legal
action or proceeding with respect to any Loan Document may be brought in the
courts of the State of New York located in the City of New York, Borough of
Manhattan, or of the United States of America for the Southern District of New
York and, by execution and delivery of this Agreement, each party hereto hereby
accepts for itself and in respect of its property, generally and
unconditionally, the jurisdiction of the aforesaid courts. The parties hereto
(and, to the extent set forth in any other Loan Document, each other Loan Party)
hereby irrevocably waive any objection, including any objection to the laying of
venue or based on the grounds of forum non conveniens, that any of them may now
or hereafter have to the bringing of any such action or proceeding in such
jurisdictions.
(b) Service of Process. Each of Holdings and Borrower (and, to the
extent set forth in any other Loan Document, each other Loan Party) hereby
irrevocably waives personal service of any and all legal process, summons,
notices and other documents and other service of process of any kind and
consents to such service in any suit, action or proceeding brought in the United
States of America with respect to or otherwise arising out of or in connection
with any Loan Document by any means permitted by applicable Requirements of Law,
including by the mailing thereof (by registered or certified mail, postage
prepaid) to the address of Borrower specified in Section 11.11 (and shall be
effective when such mailing shall be effective, as provided therein). Each of
Holdings and the Borrower (and, to the extent set forth in any other Loan
Document, each other Loan Party) agrees that a final judgment in any such action
or proceeding shall be conclusive and may be enforced in other jurisdictions by
suit on the judgment or in any other manner provided by law.
(c) Non-Exclusive Jurisdiction. Nothing contained in this Section
11.14 shall affect the right of the Administrative Agent or any Lender to serve
process in any other manner permitted by applicable Requirements of Law or
commence legal proceedings or otherwise proceed against any Loan Party in any
other jurisdiction.
Section 11.15 Waiver of Jury Trial. Each party hereto hereby
irrevocably waives trial by jury in any suit, action or proceeding with respect
to, or directly or indirectly arising out of, under or in connection with, any
Loan Document or the transactions contemplated therein or related thereto
(whether founded in contract, tort or any other theory). Each party hereto (A)
certifies that no other party and no Related Person of any other party has
represented, expressly or otherwise, that such other party would not, in the
event of litigation, seek to enforce
94
the foregoing waiver and (B) acknowledges that it and the other parties hereto
have been induced to enter into the Loan Documents, as applicable, by the mutual
waivers and certifications in this Section 11.15.
Section 11.16 Severability. Any provision of any Loan Document being
held illegal, invalid or unenforceable in any jurisdiction shall not affect any
part of such provision not held illegal, invalid or unenforceable, any other
provision of any Loan Document or any part of such provision in any other
jurisdiction.
Section 11.17 Execution in Counterparts. This Agreement may be
executed in any number of counterparts and by different parties in separate
counterparts, each of which when so executed shall be deemed to be an original
and all of which taken together shall constitute one and the same agreement.
Signature pages may be detached from multiple separate counterparts and attached
to a single counterpart. Delivery of an executed signature page of this
Agreement by facsimile transmission or Electronic Transmission shall be as
effective as delivery of a manually executed counterpart hereof.
Section 11.18 Entire Agreement. The Loan Documents embody the entire
agreement of the parties and supersede all prior agreements and understandings
relating to the subject matter thereof and any prior letter of interest,
commitment letter, fee letter, confidentiality and similar agreements involving
any Loan Party and any of the Administrative Agent, any Lender or any of their
respective Affiliates relating to a financing of substantially similar form,
purpose or effect. In the event of any conflict between the terms of this
Agreement and any other Loan Document, the terms of this Agreement shall govern
(unless such terms of such other Loan Documents are necessary to comply with
applicable Requirements of Law, in which case such terms shall govern to the
extent necessary to comply therewith).
Section 11.19 Use of Name. Each of Holdings and the Borrower agrees,
and shall cause each other Loan Party to agree, that it shall not, and none of
its Affiliates shall, issue any press release or other public disclosure (other
than any document filed with any Governmental Authority relating to a public
offering of the Securities of any Loan Party) using the name, logo or otherwise
referring to GE Capital or of any of its Affiliates, the Loan Documents or any
transaction contemplated therein to which the Secured Parties are party without
at least 2 Business Days' prior notice to GE Capital and without the prior
consent of GE Capital, in each case, except to the extent required to do so
under applicable Requirements of Law.
Section 11.20 Non-Public Information; Confidentiality. (a) The
Administrative Agent and each Lender acknowledges and agrees that it may receive
material non-public information hereunder concerning the Loan Parties and their
Affiliates and Securities and agrees to use such information in compliance with
all relevant policies, procedures and Contractual Obligations and applicable
Requirements of Laws (including United States federal and state security laws
and regulations).
(b) Each Lender and the Administrative Agent agrees to use all
reasonable efforts to maintain, in accordance with its customary practices, the
confidentiality of information obtained by it pursuant to any Loan Document,
except that such information may be disclosed (i) with the Borrower's consent,
(ii) to Related Persons of such Lender or the Administrative Agent, as the case
may be, that are advised of the confidential nature of such information and are
instructed to keep such information confidential, (iii) to the extent such
information presently is
95
or hereafter becomes available to such Lender or the Administrative Agent, as
the case may be, on a non-confidential basis from a source other than any Loan
Party, (iv) to the extent disclosure is required by applicable Requirements of
Law or other legal process or requested or demanded by any Governmental
Authority, (v) to the extent necessary or customary for inclusion in league
table measurements or in any tombstone or other advertising materials (and the
Loan Parties consent to the publication of such tombstone or other advertising
materials by the Administrative Agent, any Lender or any of their Related
Persons), (vi) to the National Association of Insurance Commissioners or any
similar organization, any examiner or any nationally recognized rating agency or
otherwise to the extent consisting of general portfolio information that does
not identify borrowers, (vii) to current or prospective assignees, SPVs grantees
of any option described in Section 11.2(f), pledges referred to in Section
11.2(e), and to their respective Related Persons, in each case to the extent
such assignees, participants, pledgees, counterparties or Related Persons agree
to be bound by provisions substantially similar to the provisions of this
Section 11.20 and (viii) in connection with the exercise of any remedy under any
Loan Document. In the event of any conflict between the terms of this Section
11.20 and those of any other Contractual Obligation entered into with any Loan
Party (whether or not a Loan Document), the terms of this Section 11.20 shall
govern.
Section 11.21 Patriot Act Notice. Each Lender subject to the Patriot
Act hereby notifies the Borrower that, pursuant to Section 326 thereof, it is
required to obtain, verify and record information that identifies the Borrower,
including the name and address of the Borrower and other information allowing
such Lender to identify the Borrower in accordance with such act.
[SIGNATURE PAGES FOLLOW]
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be executed by their respective officers thereunto duly authorized, as of the
date first above written.
IM US HOLDINGS, LLC, as Borrower
By: /s/ Xxxxx Xxxxxx
--------------------------------------
Name: Xxxxx Xxxxxx
Title: President
INVERNESS MEDICAL INNOVATIONS, INC.,
as a Guarantor
By: /s/ Xxxxx Xxxxxx
--------------------------------------
Name: Xxxxx Xxxxxx
Title: Chief Financial Officer & Treasurer
GENERAL ELECTRIC CAPITAL CORPORATION,
as Administrative Agent and Lender
By: /s/ Xxxxxx X. Xxxxx
--------------------------------------
Name: Xxxxxx X. Xxxxx
Title: Duly Authorized Signatory
98
GOLDENTREE CAPITAL OPPORTUNITIES, L.P.
By: GoldenTree Asset Management, LP,
its Investment Advisor
By: /s/ Xxxxx Xxxxx
--------------------------------------
Name: Xxxxx Xxxxx
Title: Director - Bank Debt
99
SCHEDULE I
COMMITMENTS
Term Loan
Lender Term Loan Commitment
------ --------------------
General Electric Capital Corporation $249,500,000
GoldenTree Capital Opportunities, L.P. $ 500,000
TOTAL $250,000,000
SCHEDULE II
ADDRESS FOR NOTICES
GOLDENTREE CAPITAL OPPORTUNITIES, L.P.
000 Xxxx Xxxxxx, 00xx xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxxx Xxxxx/Xxxx Xxxxxx
Telecopier: (000) 000-0000/(000) 000-0000
Telephone: (000) 000-0000/(000) 000-0000
EXHIBIT A
TO
SECOND LIEN CREDIT AGREEMENT
FORM OF ASSIGNMENT
This ASSIGNMENT, dated as of the Effective Date, is entered into between
each Assignor and each Assignee (each as defined below).
The parties hereto hereby agree as follows:
Borrower: IM US Holdings, LLC, a Delaware limited liability company (the "Borrower")
Administrative Agent: General Electric Capital Corporation, as administrative agent and collateral agent
for the Lenders (in such capacity and together with its successors and permitted
assigns, the "Administrative Agent")
Second Lien Credit Agreement: Second Lien Credit Agreement, dated as of June 26, 2007, among the Borrower,
Inverness Medical Innovations, Inc., as one of the Guarantors, the Lenders and the
Administrative Agent (as the same may be amended, restated, supplemented or otherwise
modified from time to time, the "Second Lien Credit Agreement"; capitalized terms
used herein without definition are used as defined in the Second Lien Credit
Agreement)
[Trade Date: _________, ____]
Effective Date: _________, ____
Aggregate
Aggregate amount
amount of Commitments
of Commitments or
or principal principal
Assignor Assignee Facility amount of Loans amount of Percentage
(collectively, the "Assignors") (collectively, the "Assignees") Assigned for all Lenders Loans Assigned Assigned
--------------------------------- ------------------------------- -------- --------------- -------------- -------------
[Name of Assignor] [Name of Assignee] $____________ $____________ __._________%
[Affiliate][Approved Fund] of
[Name of Lender]
[Name of Assignor] [Name of Assignee] $____________ $____________ __._________%
[Affiliate][Approved Fund] of
[Name of Lender]
[Name of Assignor] [Name of Assignee] $____________ $____________ __._________%
[Affiliate][Approved Fund] of
[Name of Lender]
[THE REMAINDER OF THIS PAGE WAS INTENTIONALLY LEFT BLANK]
A-1
Section 1. Assignment. Each Assignor hereby sells and assigns to the
Assignee set forth above opposite such Assignor, and such Assignee hereby
purchases and assumes from such Assignor, such Assignor's rights and obligations
in its capacity as Lender under the Second Lien Credit Agreement (including
Liabilities owing to or by such Assignor thereunder) and the other Loan
Documents, in each case to the extent related to the amounts identified above
opposite such Assignor (such Assignor's "Assigned Interest").
Section 2. Representations, Warranties and Covenants of Assignors. Each
Assignor severally but not jointly (a) represents and warrants to its
corresponding Assignee and the Administrative Agent that (i) it has full power
and authority, and has taken all actions necessary for it, to execute and
deliver this Assignment and to consummate the transactions contemplated hereby
and (ii) it is the legal and beneficial owner of its Assigned Interest and that
such Assigned Interest is free and clear of any Lien and other adverse claims,
(b) makes no other representation or warranty and assumes no responsibility,
including with respect to the aggregate amount of the Facilities, the percentage
of the Facilities represented by the amounts assigned, any statements,
representations and warranties made in or in connection with any Loan Document
or any other document or information furnished pursuant thereto, the execution,
legality, validity, enforceability or genuineness of any Loan Document or any
document or information provided in connection therewith and the existence,
nature or value of any Collateral, (c) assumes no responsibility (and makes no
representation or warranty) with respect to the financial condition of any Group
Member or Loan Party or the performance or nonperformance by any Loan Party of
any obligation under any Loan Document or any document provided in connection
therewith and (d) attaches any Notes held by it evidencing at least in part the
Assigned Interest of such Assignor (or, if applicable, an affidavit of loss or
similar affidavit therefor) and requests that the Administrative Agent exchange
such Notes for new Notes in accordance with Section 2.14(e) of the Second Lien
Credit Agreement.
Section 3. Representations, Warranties and Covenants of Assignees. Each
Assignee severally but not jointly (a) represents and warrants to its
corresponding Assignor and the Administrative Agent that (i) it has full power
and authority, and has taken all actions necessary for such Assignee, to execute
and deliver this Assignment and to consummate the transactions contemplated
hereby, (ii) to the extent indicated above, is an Affiliate or an Approved Fund
of the Lender set forth above and (iii) it is sophisticated with respect to
decisions to acquire assets of the type represented by the Assigned Interest
assigned to it hereunder and either such Assignee or the Person exercising
discretion in making the decision for such assignment is experienced in
acquiring assets of such type, (b) appoints and authorizes the Administrative
Agent to take such action as administrative agent and collateral agent on its
behalf and to exercise such powers under the Loan Documents as are delegated to
the Administrative Agent by the terms thereof, together with such powers as are
reasonably incidental thereto, (c) shall perform in accordance with their terms
all obligations that, by the terms of the Loan Documents, are required to be
performed by it as a Lender, (d) confirms it has received such documents and
information as it has deemed appropriate to make its own credit analysis and
decision to enter into this Assignment and shall continue to make its own credit
decisions in taking or not taking any action under any Loan Document
independently and without reliance upon any Secured Party and based on such
documents and information as it shall deem appropriate at the time, (e)
acknowledges and agrees that, as a Lender, it may receive material non-public
information and confidential information concerning the Loan Parties and their
Affiliates and Securities and agrees to use such information in accordance with
Section 11.20 of
A-2
the Second Lien Credit Agreement, (f) specifies as its applicable lending
offices (and addresses for notices) the offices at the addresses set forth
beneath its name on the signature pages hereof, (g) shall pay to the
Administrative Agent an assignment fee in the amount of $3,500 to the extent
such fee is required to be paid under Section 11.2(c) of the Second Lien Credit
Agreement and (h) to the extent required pursuant to Section 2.17(f) of the
Second Lien Credit Agreement, attaches two completed originals of Forms W-8ECI,
W-8BEN or W-9.
Section 4. Determination of Effective Date; Register. Following the due
execution and delivery of this Assignment by each Assignor, each Assignee and,
to the extent required by Section 11.2(b) of the Second Lien Credit Agreement,
the Borrower, this Assignment (including its attachments) will be delivered to
the Administrative Agent for its acceptance and recording in the Register. The
effective date of this Assignment (the "Effective Date") shall be the later of
(i) the acceptance of this Assignment by the Administrative Agent and (ii) the
recording of this Assignment in the Register. The Administrative Agent shall
insert the Effective Date when known in the space provided therefor at the
beginning of this Assignment.
Section 5. Effect. As of the Effective Date, (a) each Assignee shall be a
party to the Second Lien Credit Agreement and, to the extent provided in this
Assignment, have the rights and obligations of a Lender under the Second Lien
Credit Agreement and (b) each Assignor shall, to the extent provided in this
Assignment, relinquish its rights (except those surviving the termination of the
Commitments and payment in full of the Obligations) and be released from its
obligations under the Loan Documents other than those obligations relating to
events and circumstances occurring prior to the Effective Date.
Section 6. Distribution of Payments. On and after the Effective Date, the
Administrative Agent shall make all payments under the Loan Documents in respect
of each Assigned Interest of any Assignor (a) in the case of amounts accrued to
but excluding the Effective Date, to such Assignor and (b) otherwise, to the
corresponding Assignee.
Section 7. Miscellaneous. This Assignment is a Loan Document and, as such,
is subject to certain provisions of the Second Lien Credit Agreement, including
Sections 1.5 (Interpretation), 11.14(a) (Submission to Jurisdiction) and 11.15
(Waiver of Jury Trial) thereof. On and after the Effective Date, this Assignment
shall be binding upon, and inure to the benefit of, the Assignors, Assignees,
the Administrative Agent and their Related Persons and their successors and
assigns. This Assignment shall be governed by, and be construed and interpreted
in accordance with, the law of the State of New York. This Assignment may be
executed in any number of counterparts and by different parties in separate
counterparts, each of which when so executed shall be deemed to be an original
and all of which taken together shall constitute one and the same agreement.
Signature pages may be detached from multiple separate counterparts and attached
to a single counterpart. Delivery of an executed signature page of this
Assignment by facsimile transmission or Electronic Transmission shall be as
effective as delivery of a manually executed counterpart of this Assignment.
[SIGNATURE PAGES FOLLOW]
A-3
IN WITNESS WHEREOF, the parties hereto have caused this Assignment to be
executed by their respective officers thereunto duly authorized, as of the date
first above written.
[NAME OF ASSIGNOR]
as Assignor
By: ___________________________________
Name:
Title:
[NAME OF ASSIGNEE]
as Assignee
By: ___________________________________
Name:
Title:
Lending Office for Eurodollar Rate Loans:
[Insert Address (including contact name,
fax number and e-mail address)]
Lending Office (and address for notices)
for any other purpose:
[Insert Address (including contact name,
fax number and e-mail address)]
ACCEPTED AND AGREED
this __ day of ______ _____:
GENERAL ELECTRIC CAPITAL CORPORATION
as Administrative Agent
By: __________________________________
Name:
Title:
IM US HOLDINGS, LLC
By: _________________________________
Name:
Title:
EXHIBIT B
TO
SECOND LIEN CREDIT AGREEMENT
FORM OF TERM LOAN NOTE
Lender: [NAME OF LENDER] New York, New York
Principal Amount: $_______ June __, 2007
FOR VALUE RECEIVED, the undersigned, IM US Holdings, LLC, a Delaware
limited liability company (the "Borrower"), hereby promises to pay to the order
of the Lender set forth above (the "Lender") the Principal Amount set forth
above, or, if less, the aggregate unpaid principal amount of the Term Loans (as
defined in the Second Lien Credit Agreement referred to below) of the Lender to
the Borrower, payable at such times and in such amounts as are specified in the
Second Lien Credit Agreement.
The Borrower promises to pay interest on the unpaid principal amount of
the Term Loans from the date made until such principal amount is paid in full,
payable at such times and at such interest rates as are specified in the Second
Lien Credit Agreement. Demand, diligence, presentment, protest and notice of
non-payment and protest are hereby waived by the Borrower.
Both principal and interest are payable in Dollars to General Electric
Capital Corporation, as Administrative Agent, at _________________, in
immediately available funds.
This Note is one of the Notes referred to in, and is entitled to the
benefits of, the Second Lien Credit Agreement, dated as of June 26, 2007 (as the
same may be amended, restated, supplemented or otherwise modified from time to
time, the "Second Lien Credit Agreement"), among the Borrower, Inverness Medical
Innovations, Inc., as one of the Guarantors, the Lenders party thereto and
General Electric Capital Corporation, as administrative agent and collateral
agent for the Lenders. Capitalized terms used herein without definition are used
as defined in the Second Lien Credit Agreement.
The Second Lien Credit Agreement, among other things, (a) provides for the
making of Term Loans by the Lender to the Borrower in an aggregate amount equal
to the Principal Amount set forth above, the indebtedness of the Borrower
resulting from such Term Loans being evidenced by this Note and (b) contains
provisions for acceleration of the maturity of the unpaid principal amount of
this Note upon the happening of certain stated events and also for prepayments
on account of the principal hereof prior to the maturity hereof upon the terms
and conditions specified therein.
This Note is a Loan Document, is entitled to the benefits of the Loan
Documents and is subject to certain provisions of the Second Lien Credit
Agreement, including Sections 1.5 (Interpretation), 11.14(a) (Submission to
Jurisdiction) and 11.15 (Waiver of Jury Trial) thereof.
This Note is a registered obligation, transferable only upon notation in
the Register, and no assignment hereof shall be effective until recorded
therein.
B-1
This Note shall be governed by, and construed and interpreted in
accordance with, the law of the State of New York.
[SIGNATURE PAGES FOLLOW]
B-2
In witness whereof, the Borrower has caused this Note to be executed and
delivered by its duly authorized officer as of the day and year and at the place
set forth above.
IM US HOLDINGS, LLC
By: _____________________________
Name:
Title:
EXHIBIT C
TO
SECOND LIEN CREDIT AGREEMENT
FORM OF NOTICE OF BORROWING
GENERAL ELECTRIC CAPITAL CORPORATION
as Administrative Agent under the
Second Lien Credit Agreement referred to below
____________ __, ____
Attention:
Re: IM US HOLDINGS, LLC (the "Borrower")
Reference is made to the Second Lien Credit Agreement, dated as of
June 26, 2007 (as the same may be amended, restated, supplemented or otherwise
modified from time to time, the "Second Lien Credit Agreement"), among the
Borrower, Inverness Medical Innovations, Inc., as one of the Guarantors, the
Lenders party thereto and General Electric Capital Corporation, as
administrative agent and collateral agent for such Lenders. Capitalized terms
used herein without definition are used as defined in the Second Lien Credit
Agreement.
The Borrower hereby gives you irrevocable notice, pursuant to
Section 2.2 of the Second Lien Credit Agreement of its request of a Borrowing
(the "Proposed Borrowing") under the Second Lien Credit Agreement and, in that
connection, sets forth the following information:
A. The date of the Proposed Borrowing is __________, ____ (the
"Funding Date").
B. The aggregate principal amount of Term Loans requested is
$_______, of which $________ consists of Base Rate Loans and $________
consists of Eurodollar Rate Loans having an initial Interest Period of
______ months.
The undersigned hereby certifies that the following statements are
true on the date hereof, both before and after giving effect to the Proposed
Borrowing and any other Loan to be made on or before the Funding Date:
(i) the representations and warranties set forth in Article IV of
the Second Lien Credit Agreement and elsewhere in the Loan Documents are
true and correct in all material respects [as though made on and as of
such Funding Date], except to the extent such representations and
warranties expressly relate to an earlier date, in which case such
representations and warranties were true and correct as of such date; and
C-1
(ii) no Default is continuing.
IM US HOLDINGS, LLC
By: _________________________
Name:
Title:
EXHIBIT D
TO
SECOND LIEN CREDIT AGREEMENT
[INTENTIONALLY OMITTED]
D-1
EXHIBIT E
TO
SECOND LIEN CREDIT AGREEMENT
[INTENTIONALLY OMITTED]
E-1
EXHIBIT F
TO
SECOND LIEN CREDIT AGREEMENT
FORM OF NOTICE OF CONVERSION OR CONTINUATION
GENERAL ELECTRIC CAPITAL CORPORATION
as Administrative Agent under the
Second Lien Credit Agreement referred to below
____________ __, ____
Attention:
Re: IM US HOLDINGS, LLC (the "Borrower")
Reference is made to the Second Lien Credit Agreement, dated as of
June 26, 2007 (as the same may be amended, restated, supplemented or otherwise
modified from time to time, the "Second Lien Credit Agreement"), among the
Borrower, Inverness Medical Innovations, Inc., as one of the Guarantors, the
Lenders party thereto and General Electric Capital Corporation, as
administrative agent and collateral agent for the Lenders. Capitalized terms
used herein and not otherwise defined herein are used herein as defined in the
Second Lien Credit Agreement.
The Borrower hereby gives you irrevocable notice, pursuant to
Section 2.10 of the Second Lien Credit Agreement of its request for the
following:
(i) a continuation, on ________, ____, as Eurodollar Rate Loans
having an Interest Period of ___ months of Term Loans in an aggregate
outstanding principal amount of $____________ having an Interest Period
ending on the proposed date for such continuation;
(ii) a conversion, on ________, ____, to Eurodollar Rate Loans
having an Interest Period of ___ months of Term Loans in an aggregate
outstanding principal amount of $_________; and
In connection herewith, the undersigned hereby certifies that no
Default is continuing on the date hereof, both before and after giving effect to
any Loan to be made on or before any date for any proposed conversion or
continuation set forth above (it being understood that no conversion or
continuation requested herein shall constitute the making of any Loan).
IM US HOLDINGS, LLC
By: _____________________________
Name:
Title:
F-1
EXHIBIT G
TO
SECOND LIEN CREDIT AGREEMENT
FORM OF COMPLIANCE CERTIFICATE
_________________, _____
This Compliance Certificate (this "Certificate") is delivered
pursuant to Section 6.1(c) of, and in connection with the consummation of the
transactions contemplated in, the Second Lien Credit Agreement, dated as of June
26, 2007 (as the same may be amended, restated, supplemented or otherwise
modified from time to time, the "Second Lien Credit Agreement"), among IM US
Holdings, LLC (the "Borrower"), Inverness Medical Innovations, Inc., as one of
the Guarantors ("Holdings"), the Lenders and L/C Issuers party thereto and
General Electric Capital Corporation, as administrative agent and collateral
agent for the Lenders and L/C Issuers (the "Administrative Agent"). Capitalized
terms used herein and not otherwise defined herein are used herein as defined
in the Second Lien Credit Agreement.
In the event of any conflict between the terms of this Certificate
and the Second Lien Credit Agreement, the terms of the Second Lien Credit
Agreement shall govern.
The undersigned is duly authorized to execute and deliver this
Certificate on behalf of Holdings. By executing this Certificate such officer,
on behalf of the Holdings (and not in such officer's personal capacity), hereby
certifies to Administrative Agent and Lenders that:
(a) In accordance with Section 6.1(a)/(b) of the Second Lien Credit
Agreement, attached hereto as Schedule 1 are the Financial Statements for the
[Fiscal Quarter/Fiscal Year] ended _________, ____ required to be delivered
pursuant to Section 6.1(a)/(b) of the Second Lien Credit Agreement. Such
Financial Statements fairly present in all material respects the Consolidated
financial position, results of operations and cash flow of Holdings as at the
dates indicated therein and for the periods indicated therein in accordance with
GAAP [(subject to the absence of footnote disclosure and normal year end audit
adjustments][without qualification as to the scope of the audit or as to going
concern and without any other similar qualification]. [NOTE TO RESPONSIBLE
OFFICER: THE FIRST BRACKETED CLAUSE ONLY APPLIES TO QUARTERLY REPORTS, THE
SECOND BRACKETED CLAUSE ONLY APPLIES TO ANNUAL REPORTS]
(b) I have reviewed the terms of the Second Lien Credit Agreement
and have made, or caused to be made under my supervision, a review in reasonable
detail of the transactions and conditions of Holdings during the relevant
accounting period covered by such financial statements;
(c) as of the date hereof, I have no knowledge that a Default is
continuing, except as set forth on Schedule 2 hereto, which includes a
description of the nature and period of existence of such Default or an Event of
Default and what action Holdings, Borrower or their respective Subsidiaries have
taken, are taking and propose to take with respect thereto;
(d) except as set forth on Schedule 3 hereto, Holdings and Borrower
are in compliance with the covenants contained in Sections 8.1, 8.3 and 8.4 and
Article 5 of the Second Lien Credit Agreement, to the extent set forth on
Schedule 3 hereto [NOTE TO RESPONSIBLE OFFICER: THE PORTION OF SCHEDULE 3
PERTAINING TO FINANCIAL COVENANTS IS ONLY REQUIRED TO BE COMPLETED AS OF THE END
OF EACH FISCAL QUARTER];
(e) Excess Cash Flow, as demonstrated by the calculation on Schedule
3 hereto, for the Fiscal Year ending ___________ equals $__________; [NOTE TO
RESPONSIBLE OFFICER: THIS CLAUSE IS ONLY REQUIRED TO BE COMPLETED IN CONNECTION
WITH THE DELIVERY OF AUDITED FINANCIAL STATEMENTS PURSUANT TO SECTION 6.1(B) OF
THE SECOND LIEN CREDIT AGREEMENT]
(f) in accordance with Section 6.1(d) of the Second Lien Credit
Agreement, (i) the [Corporate Chart attached hereto as Schedule 4] [last
Corporate Chart delivered pursuant to such Section)], is correct and complete as
of the date hereof;
(g) in accordance with Section 6.1(f) and (h) of the Second Lien
Credit Agreement to the extent not included in Holdings' public filings,
attached hereto as Schedule 5 is a discussion and analysis of the financial
condition and results of operations of the Group Members for the portion of the
Fiscal Year elapsed on or prior to the date hereof discussing the reasons for
any significant variations from the Projections for such period and the figures
for the corresponding period in the previous Fiscal Year [and copies of each
management letter, audit report or similar letter or report received by any
Group Member from any independent registered certified public accountant
(including the Group Members' Accountants) in connection with such Financial
Statements or any audit thereof]; [NOTE TO RESPONSIBLE OFFICER: THE BRACKETED
CLAUSE ONLY APPLIES TO ANNUAL REPORTS]
(h) [in accordance with Section 6.1(g) of the Second Lien Credit
Agreement, attached hereto as Schedule 6 is a correct and complete summary of
the outstanding balances of all intercompany Indebtedness as of the last day of
the Fiscal Year covered by the Financial Statements attached hereto;] [NOTE TO
RESPONSIBLE OFFICER: THE BRACKETED PARAGRAPH ONLY APPLIES TO ANNUAL REPORTS]
(i) [in accordance with Section 6.1(i) of the Second Lien Credit
Agreement, attached hereto as Schedule 7 is a summary of all material insurance
coverage maintained as of the date hereof by any Group member.] [NOTE TO
RESPONSIBLE OFFICER: THE BRACKETED PARAGRAPH ONLY APPLIES TO ANNUAL REPORTS]
[SIGNATURE PAGE FOLLOWS]
IN WITNESS WHEREOF, the undersigned, a Responsible Officer of
Holdings, has executed this Certificate on this ____ day of ___________, ____.
INVERNESS MEDICAL INNOVATIONS, INC.
By : _______________________________
Name: _____________________________
Title: ______________________________
SCHEDULE 1
Exhibit G
FINANCIAL STATEMENTS
SCHEDULE 2
Exhibit G
CONDITIONS OR EVENTS WHICH CONSTITUTE A DEFAULT OR EVENT OF DEFAULT
If any condition or event exists that constitutes a Default or Event of Default,
specify nature and period of existence and what action Holdings, Borrower or
their respective Subsidiaries have taken, are taking or propose to take with
respect thereto; if no condition or event exists, state "None."
SCHEDULE 3
Exhibit G
ALL AMOUNTS IN EXHIBIT G ARE WITHOUT DUPLICATION AND, UNLESS OTHERWISE
INDICATED, ARE CALCULATED FOR HOLDINGS AND BORROWER ON A CONSOLIDATED BASIS
CONSOLIDATED EBITDA
(ARTICLE 1)
Consolidated Net Income is defined as follows:
Consolidated net income (or loss) of Holdings and its Subsidiaries during the
measuring period: $__________
Less: (in each case to the extent included in Consolidated net income
referred to above for the measuring period, but without duplication):
the net income of any other Person in which Holdings or one of its
Subsidiaries has a joint interest with a third-party (which interest
does not cause the net income of such other Person to be Consolidated
into the net income of Holdings), except to the extent of the amount of
dividends or distributions paid to Holdings or its Subsidiaries $__________
the net income of any Subsidiary of Holdings that is, on the last day
of such period, subject to any restriction or limitation on the payment
of dividends or the making of other distributions (other than under the
Loan Documents), to the extent of such restriction or limitation $__________
the net income of any other Person arising prior to such other Person
becoming a Subsidiary of Holdings or merging or consolidating into
Holdings or its Subsidiaries $__________
consolidated minority interest expense of Holdings or one of its
Subsidiaries resulting from allocations of earnings of any Consolidated
Subsidiary which is less than 100% owned, except to the extent of the
amount of dividends and distributions paid by Holdings or its
Subsidiary to the minority shareholders of such Consolidated Subsidiary $__________
Consolidated Net Income: $
============
Consolidated EBITDA is defined as follows:
Consolidated Net Income (from above) $__________
Plus: (in each case to the extent included in the calculation of Consolidated Net
Income in respect of Holdings and its
Subsidiaries, but without duplication):
(i) any provision for income taxes or other taxes measured by net income $__________
(ii) Consolidated Interest Expense (from Section 5.2 of this Exhibit),
amortization of debt discount and commissions and other fees and charges
associated with Indebtedness $__________
(iii) any loss from extraordinary items and any non-recurring loss: $__________
(list out each item and amount)
(iv) any depreciation, depletion and amortization expense $__________
(v) any aggregate net loss on the Sale of property (other than accounts (as
defined under the applicable UCC) and inventory) outside the ordinary
course of business $__________
(vi) any other non-cash expenditure, charge or loss for such period (other
than any non-cash expenditure, charge or loss relating to write-offs,
write-downs or reserves with respect to accounts and inventory), including
the amount of any compensation deduction as the result of any grant of
Stock or Stock Equivalents to employees, officers, directors or consultants $__________
cost savings amount(1) [after Cholestech Acquisition] (2) $__________
[NOTE TO RESPONSIBLE OFFICER: FOOTNOTES ONLY APPLY FOR THE FIRST 4 FISCAL QUARTERS
AFTER THE CLOSING DATE AND IN THE CASE OF THE CHOLESTECH ACQUISITION AND THE 4 FISCAL
QUARTER PERIODS DESCRIBED THEREIN]
Less:
(in each case to the extent included in the calculation of
Consolidated Net Income in respect of Holdings and its Subsidiaries,
but without duplication):
any credit for income taxes or other taxes measured by net income $__________
any interest income $__________
---------------
(1) For each of the 4 Fiscal Quarter periods ending September 30, 2007,
December 31, 2007, March 31, 2008 and June 30, 2008 the following cost
savings amounts: $28,000,000, $20,000,000, $10,000,000 and $0,
respectively and as applicable.
(2) If the Cholestech Acquisition has been consummated, for the 4 Fiscal
Quarter period ending on the last day of the Fiscal Quarter in which the
Cholestech Acquisition has been consummated and for the immediately
succeeding three 4 Fiscal Quarter periods thereafter, the following cost
savings amounts: $6,000,000, $5,600,000, $4,000,000 and $2,000,000,
respectively and as applicable.
any gain from extraordinary items and any other non-recurring gain $__________
(list out each item and amount)
any aggregate net gain from the Sale of property (other than accounts
(as defined in the applicable UCC) and inventory) out of the ordinary
course of business by Holdings $__________
any other non-cash gain, including any reversal of a charge referred
to in (vi) above by reason of a decrease in the value of any Stock or
Stock Equivalent $__________
any other cash payment in respect of expenditures, charges and losses
that have been added to Consolidated EBITDA of Holdings referred to in
(vi) above in any prior period $__________
Consolidated EBITDA $
===========
Provided that:
Prior to the Cholestech Acquisition Consolidated EBITDA is deemed to be for
the:
Fiscal Quarter Ended December 31, 2006 $43,877,000
-----------
Fiscal Quarter Ended March 31, 2007 $46,972,200
-----------
and after the Cholestech Acquisition Consolidated EBITDA is deemed to be
for the:
Fiscal Quarter Ended December 31, 2006 $48,437,000
----------
Fiscal Quarter Ended March 31, 2007 $51,296,200
-----------
MAXIMUM CONSOLIDATED LEVERAGE RATIO
(SECTION 5.1)
Consolidated Total Debt is defined as follows:
All indebtedness of Holdings and its Subsidiaries for borrowed money $__________
Plus: all obligations of Holdings and its Subsidiaries evidenced by notes, bonds,
debentures or similar instruments $__________
all reimbursement and all obligations of Holdings and its Subsidiaries with
respect to letters of credit, bank guarantees or bankers' acceptances $__________
all obligations of Holdings and its Subsidiaries to pay the deferred
purchase price of property or services (other than trade payables incurred
in the ordinary course of business that are unsecured and customary
adjustments of purchase price, contingent payments, earnout payments or
similar obligations under any of the documents pertaining to a merger or
acquisition or Sale) $__________
all Capitalized Lease Obligations of Holdings and its Subsidiaries $__________
all Guaranty Obligations of Holdings and its Subsidiaries with respect to
the any such indebtedness listed in the above categories $
===========
CONSOLIDATED TOTAL DEBT $
===========
Consolidated Ebitda (CALCULATED IN ARTICLE 1 OF THIS EXHIBIT) FOR THE LAST PERIOD OF
FOUR CONSECUTIVE FISCAL QUARTERS $__________
Consolidated Leverage Ratio (Consolidated Total Debt, divided by Consolidated EBITDA)
===========
Required Maximum Consolidated Leverage Ratio (from the chart in Section 5.1 of the
Second Lien Credit Agreement)
===========
In Compliance Yes/No
CAPITAL EXPENDITURE LIMIT
(SECTION 5.3)
Capital Expenditures are defined as follows:
The aggregate of all expenditures, whether or not made through the
incurrence of Indebtedness, by any Loan Party for the Fiscal Year for the
acquisition, leasing (pursuant to a Capital Lease), construction,
replacement, repair, substitution or improvement of fixed or capital assets
or additions to equipment, in each case required to be capitalized under
GAAP $__________
Less: Interest capitalized during construction $__________
Less: Any expenditure to the extent, for purpose of the definition of
Permitted Acquisition, such expenditure is part of the aggregate
amounts payable in connection with, or other consideration for, any
Permitted Acquisition consummated during or prior to such period $__________
CAPITAL EXPENDITURES (FOR THE FISCAL YEAR) $
===========
2.9% of Total Assets as of the end of the immediately preceding Fiscal Year $
===========
Capital Expenditures (for the Fiscal Year) shall not exceed 2.9% of Total Assets
as of the end of the immediately preceding Fiscal Year
In Compliance Yes/No
INDEBTEDNESS
(SECTION 8.1)
Indebtedness incurred with respect to Capitalized Lease Obligations (other than
leases as part of a Sale and Leaseback Transaction), plus purchase money
Indebtedness incurred to finance the acquisition, repair, improvement or
construction of fixed or capital assets, plus any Permitted Refinancing of
Indebtedness allowed under Section 8.1(c) of the First Lien Credit Agreement
(8.1(c)):
Actual in the aggregate $_______________
Permitted in the aggregate $ 17,250,000
The principal amount of such Indebtedness does not exceed the cost of the
property so acquired or built or of such repairs or improvement.
In Compliance Yes/No
Unsecured subordinated Indebtedness of the Borrower under the Subordinated
Convertible Notes pursuant to the Subordinated Convertible Notes Indenture
(8.1(i)):
Actual in the aggregate $_______________
Permitted in the aggregate $ 172,500,000
In Compliance Yes/No
Unsecured Indebtedness of any Group Member (8.1(k)):
Actual in the aggregate $_______________
Permitted in the aggregate $ 34,500,000
In Compliance Yes/No
Indebtedness of any Group Member not a Loan Party (8.1(l)):
Actual in the aggregate $_______________
Permitted in the aggregate $ 23,000,000
In Compliance Yes/No
INVESTMENTS
(SECTION 8.3)
Payments required under the P&G JV Capital Call Obligations to the P&G JV
Companies in accordance with the P&G JV Agreements (8.3(j)):
Actual individual capital call $_______________
Permitted individual capital call $ 11,500,000
Actual aggregate capital calls (Fiscal Year) $_______________
Permitted aggregate capital calls (Fiscal Year) $ 23,000,000
After giving effect to such payment, the unused First Lien Revolving
Credit Commitments and available cash and Cash Equivalents on deposit to a
Cash Collateral Account (other than the Acquisition Collateral Account) or
a Controlled Deposit Account shall be at least $42,500,000 in the
aggregate
In Compliance Yes/No
Any Investment by Holdings or any of its Subsidiaries (8.3(k)):
Actual in the aggregate $_______________
Permitted in the aggregate $ 115,000,000
In Compliance Yes/No
The sum of (a) the fair market value of all Permitted Acquisitions (or portions
thereof) (other than the Cholestech Acquisition) and (b) the aggregate net
amount of other Investments (or portions thereof) funded or made in or
transferred to, or made or acquired by, any Person after the Closing Date
(excluding, in each case, any Excluded Investments) that is not or does not
become after giving effect to such Permitted Acquisition or other Investment, a
Loan Party:
Actual in the aggregate $_______________
Permitted in the aggregate The greater of or
$172,500,000,
$_______________ (5.75% of Total Assets)
In Compliance Yes/No
ASSET SALES
(SECTION 8.4)
Aggregate fair market value (measured at the time of the applicable Sale) of all
property covered by any outstanding Sale and Leaseback Transaction (8.4(b)):
Actual in the aggregate $_______________
Permitted in the aggregate $ 11,500,000
In Compliance Yes/No
Any Sale of property (other than as part of a Sale and Leaseback Transaction)
of, or Sale or issuance of its own Stock by, any Group Member (other than
Holdings) for fair market value payable in cash upon such sale (8.4(e)):
Actual in the aggregate (received during
this Fiscal Year) $_______________
Permitted in the aggregate (Fiscal Year) $ 17,250,000
In Compliance Yes/No
Any Sale of real property consummated prior to the second anniversary of the
Closing Date (including as part of a Sale and Leaseback Transaction) for fair
market value payable in cash upon such sale (8.4(g)):
Actual in the aggregate (received after $_______________
Closing Date)
Permitted in the aggregate (after Closing Date) $ 172,500,000
In Compliance Yes/No
EXCESS CASH FLOW
(SECTION 2.8(a))
Excess Cash Flow is defined as follows:
Consolidated EBITDA (calculated in Article 1 of this Exhibit) of Holdings $__________
Less (without duplication):
any cash principal payment on the Loans during the measuring period
(but only, in the case of payment in respect of Revolving Loans, to
the extent that the Revolving Credit Commitments are permanently
reduced by the amount of such payment) other than any mandatory
prepayment required pursuant to Section 2.8(a) of the Second Lien
Credit Agreement because of the existence of Excess Cash Flow $__________
any scheduled or other mandatory cash principal payment made by the
Borrower or any of its Subsidiaries during the measuring period on
any Capitalized Lease Obligation or other Indebtedness (but only, if
such Indebtedness may be reborrowed, to the extent such payment
results in a permanent reduction in commitments thereof) $__________
any Capital Expenditure made by Holdings or any of its Subsidiaries
during the measuring period to the extent permitted by the Second
Lien Credit Agreement, excluding the portion thereof financed with
long-term Indebtedness (other than the Obligations) $__________
the Consolidated Cash Interest Expense of Holdings and its Subsidiaries for
the measuring period (from Section 5.2 of this Exhibit) $__________
any cash losses from extraordinary items $__________
any cash paid during the measuring period or payable with respect to
such period to satisfy obligations for income taxes or other taxes
measured by net income $__________
cash restructuring costs associated with the Acquisition or any Permitted
Acquisition $__________
any Permitted Acquisition Consideration paid in cash or Investments
pursuant to Sections 8.3(j) and (k) of the Second Lien Credit
Agreement made in cash, in each case, by Holdings or any of its
Subsidiaries during the measuring period to the extent permitted by
the Second Lien Credit Agreement but excluding any portion thereof
financed with long-term Indebtedness (other than Obligations) or
with proceeds of the issuance of common stock of Holdings $__________
any increase in the Working Capital of Holdings during the measuring
period (measured as the excess of such Working Capital at the end of
such period over such Working Capital at the beginning of such
period) $__________
Plus (without duplication): $__________
any decrease in the Working Capital (Consolidated Current Assets minus
Consolidated Current Liabilities) of Holdings during the measuring period
(measured as the excess of such Working Capital at the beginning of such
period over such Working Capital at the end thereof) $__________
Excess Cash Flow $
==========
Required Excess Cash Flow payment due to the Administrative Agent pursuant to
Section 2.8(a) of the Second Lien Credit Agreement (50% of Excess Cash Flow for this
Fiscal Year) [(for the Fiscal Year ending December 31, 2007, 50% of Excess Cash Flow $
for the six-month period then ended)] =========
-------------
** in the event that the Consolidated Leverage Ratio of Holdings as of the
end of any Fiscal Year, commencing with the Fiscal Year ending December
31, 2009, is less than (x) 5.00:1.00, then such percentage for such Fiscal
Year shall be reduced to 25% or (y) 4.00:1.00, then such percentage for
such Fiscal Year shall be reduced to 0%.
SCHEDULE 4
Exhibit G
CORPORATE CHART
SCHEDULE 5
Exhibit G
MANAGEMENT DISCUSSION AND ANALYSIS; AUDIT REPORTS, MANAGEMENT LETTERS, ETC.
SCHEDULE 6
Exhibit G
INTERCOMPANY LOAN BALANCES
SCHEDULE 7
Exhibit G
INSURANCE
EXHIBIT I
TO
SECOND LIEN CREDIT AGREEMENT
FORM OF INTERCREDITOR AGREEMENT
================================================================================
INTERCREDITOR AGREEMENT
DATED AS OF JUNE 26, 2007,
BETWEEN
GENERAL ELECTRIC CAPITAL CORPORATION,
AS FIRST LIEN AGENT,
AND
GENERAL ELECTRIC CAPITAL CORPORATION,
AS SECOND LIEN AGENT,
UNDER
CREDIT AGREEMENTS FOR
IM US HOLDINGS, LLC,
AS BORROWER,
Paul, Hastings, Xxxxxxxx & Xxxxxx LLP
00 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
================================================================================
TABLE OF CONTENTS
Section Page
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SECTION 1. Definitions............................................................................... 2
1.1 Certain Terms................................................................................. 2
1.2 Defined Terms................................................................................. 2
1.3 Terms Generally............................................................................... 7
SECTION 2. Lien Priorities........................................................................... 8
2.1 Relative Priorities........................................................................... 8
2.2 Prohibition on Contesting Liens............................................................... 9
2.3 No New Liens.................................................................................. 9
2.4 Similar Liens and Agreements.................................................................. 9
SECTION 3. Enforcement............................................................................... 10
3.1 Exercise of Remedies.......................................................................... 10
3.2 Cooperation................................................................................... 12
SECTION 4. Payments.................................................................................. 12
4.1 Application of Proceeds....................................................................... 12
4.2 Payments Over................................................................................. 13
SECTION 5. Other Agreements.......................................................................... 13
5.1 Releases...................................................................................... 13
5.2 Insurance; Condemnation....................................................................... 14
5.3 Amendments to First Lien Loan Documents and Second Lien Loan Documents........................ 15
5.4 Rights As Unsecured Creditors................................................................. 17
5.5 Bailee for Perfection......................................................................... 17
5.6 When Discharge of First Lien Obligations Deemed to Not Have Occurred.......................... 18
5.7 Purchase Right................................................................................ 19
SECTION 6. Insolvency or Liquidation Proceedings..................................................... 19
6.1 Finance and Sale Issues....................................................................... 19
6.2 Relief from the Automatic Stay................................................................ 20
6.3 Adequate Protection........................................................................... 20
6.4 No Waiver..................................................................................... 21
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Section Page
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6.5 Avoidance Issues.............................................................................. 21
6.6 Reorganization Securities..................................................................... 21
6.7 Post-Petition Interest........................................................................ 22
6.8 Waiver........................................................................................ 22
6.9 Nature of Obligations; Post-Petition Interest................................................. 22
6.10 Proofs of Claim............................................................................... 23
6.11 Asset Dispositions in an Insolvency Proceeding................................................ 23
6.12 Other Matters................................................................................. 23
SECTION 7. RELIANCE; WAIVERS; ETC.................................................................... 23
7.1 Reliance...................................................................................... 23
7.2 No Warranties or Liability.................................................................... 24
7.3 No Waiver of Lien Priorities.................................................................. 24
7.4 Obligations Unconditional..................................................................... 26
7.5 Certain Notices............................................................................... 27
SECTION 8. MISCELLANEOUS............................................................................. 27
8.1 Conflicts..................................................................................... 27
8.2 Effectiveness; Continuing Nature of this Agreement; Severability; Termination................. 27
8.3 Amendments; Waivers........................................................................... 28
8.4 Information Concerning Financial Condition of Holdings, Borrower and their Subsidiaries....... 28
8.5 Subrogation................................................................................... 28
8.6 Application of Payments....................................................................... 28
8.7 SUBMISSION TO JURISDICTION; WAIVERS........................................................... 29
8.8 Notices....................................................................................... 30
8.9 Further Assurances............................................................................ 30
8.10 APPLICABLE LAW................................................................................ 30
8.11 Binding on Successors and Assigns............................................................. 30
8.12 Specific Performance.......................................................................... 30
8.13 Headings...................................................................................... 30
8.14 Counterparts.................................................................................. 30
8.15 Authorization................................................................................. 31
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Section Page
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8.16 No Third Party Beneficiaries.................................................................. 31
8.17 Provisions Solely to Define Relative Rights................................................... 31
-iii-
INTERCREDITOR AGREEMENT
This INTERCREDITOR AGREEMENT is dated as of June 26, 2007, and
entered into by and between GENERAL ELECTRIC CAPITAL CORPORATION, in its
capacity as administrative agent and collateral agent for the First Lien
Obligations (as defined below), including its successors and assigns from time
to time (the "FIRST LIEN AGENT"), and GENERAL ELECTRIC CAPITAL CORPORATION, in
its capacity as administrative agent and collateral agent for the Second Lien
Obligations (as defined below), including its successors and assigns from time
to time (the "SECOND LIEN AGENT"). Capitalized terms used herein have the
meanings set forth in Section 1 below.
RECITALS
WHEREAS, IM US Holdings, LLC, a Delaware limited liability company
(the "BORROWER"), Inverness Medical Innovations, Inc., a Delaware corporation
("HOLDINGS"), General Electric Capital Corporation, the lenders party thereto,
GE Capital Markets, Inc. and UBS Securities LLC, as Joint Lead Arrangers, GE
Capital Markets, Inc., as Sole Bookrunner, UBS Securities LLC, as Syndication
Agent, the other agents party thereto and General Electric Capital Corporation,
as Issuing Bank, Administrative Agent, L/C Issuer and Swingline Lender, have
entered into that $1,050,000,000 Credit Agreement dated as of the date hereof
providing for a revolving credit facility and term loan (as amended, restated,
supplemented or otherwise modified from time to time as permitted hereunder, the
"INITIAL FIRST LIEN CREDIT AGREEMENT");
WHEREAS, the Borrower, Holdings, the lenders party thereto, UBS
Securities LLC and GE Capital Markets, Inc., as Joint Lead Arrangers, UBS
Securities LLC, as Sole Bookrunner and Syndication Agent, the other agents party
thereto and General Electric Capital Corporation, as Administrative Agent, have
entered into that $250,000,000 Second Lien Credit Agreement dated as of the date
hereof providing for a term loan (as amended, restated, supplemented or
otherwise modified from time to time as permitted hereunder, the "INITIAL SECOND
LIEN CREDIT AGREEMENT");
WHEREAS, the obligations of the Loan Parties under the First Lien
Credit Agreement, certain other obligations of the Loan Parties and certain
Secured Hedging Agreements will be secured by substantially all the assets of
the Borrower, Holdings and the Guarantors, respectively, pursuant to the terms
of the First Lien Security Documents;
WHEREAS, the obligations of the Loan Parties under the Second Lien
Credit Agreement will be secured by substantially all the assets of the
Borrower, Holdings and the Guarantors, respectively, pursuant to the terms of
the Second Lien Security Documents;
WHEREAS, the First Lien Loan Documents and the Second Lien Loan
Documents provide, among other things, that the parties thereto shall set forth
in this Agreement their respective rights and remedies with respect to the
Collateral; and
WHEREAS, in order to induce the First Lien Agent and the First Lien
Secured Parties to consent to the Loan Parties incurring the Second Lien
Obligations and to induce the First Lien Secured Parties to extend credit and
other financial accommodations and lend monies to or for the benefit of the
Borrower, or any other Loan Party, the Second Lien Agent on behalf
of the Second Lien Secured Parties has agreed to the subordination (including
the intercreditor and other) provisions set forth in this Agreement.
NOW, THEREFORE, in consideration of the foregoing, the mutual
covenants and obligations set forth herein and for other good and valuable
consideration, the sufficiency and receipt of which are hereby acknowledged, the
parties hereto, intending to be legally bound, hereby agree as follows:
SECTION 1.DEFINITIONS.
1.1 Certain Terms. Capitalized terms used in this Agreement and not
otherwise defined herein have the meanings set forth in the First Lien Credit
Agreement, the Second Lien Credit Agreement, the First Lien Guaranty and
Security Agreement or the Second Lien Guaranty and Security Agreement, as
applicable.
1.2 Defined Terms. As used in the Agreement, the following terms
shall have the following meanings:
"AGREEMENT" means this Intercreditor Agreement, as amended,
restated, renewed, extended, supplemented or otherwise modified from time to
time in accordance with the terms hereof.
"BANKRUPTCY CODE" means Title 11 of the United States Code entitled
"Bankruptcy," as now and hereafter in effect, or any successor statute.
"BANKRUPTCY LAW" means the Bankruptcy Code and any similar federal,
state or foreign law for the relief of debtors.
"BORROWER" has the meaning set forth in the recitals hereto.
"BUSINESS DAY" means any day of the year that is not a Saturday,
Sunday or a day on which banks are required or authorized to close in New York
City.
"COLLATERAL" means all of the assets and property of any Loan Party,
whether real, personal or mixed, constituting both First Lien Collateral and
Second Lien Collateral.
"COMPARABLE SECOND LIEN SECURITY DOCUMENT" means, in relation to any
Collateral subject to any Lien created under any First Lien Security Document,
that Second Lien Security Document which creates a Lien on the same Collateral,
granted by the same Loan Party.
"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 ownership of voting securities, by contract or otherwise,
and the terms "CONTROLLING" and "CONTROLLED" shall have meanings correlative
thereto.
"DIP FINANCING" has the meaning set forth in Section 6.1.
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"DISCHARGE OF FIRST LIEN OBLIGATIONS" means, except to the extent
otherwise provided in Section 5.6, (a) payment in full in cash of the principal
of and interest (including interest accruing on or after the commencement of any
Insolvency or Liquidation Proceeding at the rate set forth in the First Lien
Credit Agreement, whether or not such interest would be allowed or allowable in
such Insolvency or Liquidation Proceeding) and premium, if any, on all
Indebtedness outstanding under the First Lien Loan Documents constituting First
Lien Obligations, (b) payment in full in cash of all other First Lien
Obligations that are due and payable or otherwise accrued and owing at or prior
to the time such principal and interest are paid (including monetary obligations
incurred during the pendency of any bankruptcy, insolvency, receivership or
other similar proceeding, regardless of whether allowed or allowable in such
proceeding), (c) termination or cash collateralization (in an amount reasonably
satisfactory to the First Lien Agent) of all letters of credit issued under the
First Lien Loan Documents constituting First Lien Obligations and (d)
termination of all other commitments of the First Lien Secured Parties under the
First Lien Loan Documents constituting First Lien Obligations.
"DISCHARGE OF SECOND LIEN OBLIGATIONS" means (a) payment in full in
cash of the principal of and interest (including interest accruing on or after
the commencement of any Insolvency or Liquidation Proceeding at the rate set
forth in the Second Lien Credit Agreement, whether or not such interest would be
allowed or allowable in such Insolvency or Liquidation Proceeding) and premium,
if any, on all Indebtedness outstanding under the Second Lien Loan Documents
constituting Second Lien Obligations and (b) payment in full in cash of all
other Second Lien Obligations that are due and payable or otherwise accrued and
owing at or prior to the time such principal and interest are paid (including
monetary obligations incurred during the pendency of any bankruptcy, insolvency,
receivership or other similar proceeding, regardless of whether allowed or
allowable in such proceeding).
"DISPOSITION" has the meaning set forth in Section 5.1.
"EXCESS FIRST LIEN LOAN AMOUNT" shall mean, as of any date of
determination, all First Lien Obligations in excess of the Maximum First Lien
Indebtedness Amount.
"EXERCISE OF REMEDIES" has the meaning set forth in Section 5.1.
"FIRST LIEN AGENT" has the meaning set forth in the preamble hereof.
"FIRST LIEN COLLATERAL" means all of the assets and property of any
Loan Party, whether real, personal or mixed, with respect to which a Lien is
granted or purported to be granted as security for any First Lien Obligations.
"FIRST LIEN CREDIT AGREEMENT" means (i) the Initial First Lien
Credit Agreement and (ii) any other credit agreement, loan agreement, note
agreement, promissory note, indenture or other agreement or instrument
evidencing or governing the terms of any indebtedness or other financial
accommodation that has been incurred to extend, increase or Refinance (subject
to the limitations set forth herein and in the Second Lien Credit Agreement) in
whole or in part the indebtedness and other obligations outstanding under (x)
the credit
-3-
agreement referred to in clause (i) or (y) any subsequent First Lien Credit
Agreement, unless such agreement or instrument expressly provides that it is not
intended to be and is not a First Lien Credit Agreement hereunder. Any reference
to the First Lien Credit Agreement hereunder shall be deemed a reference to any
First Lien Credit Agreement then in existence.
"FIRST LIEN LENDERS" means the "Lenders" under and as defined in the
First Lien Credit Agreement.
"FIRST LIEN LOAN DOCUMENTS" means the First Lien Credit Agreement
and the other Loan Documents (as defined in the First Lien Credit Agreement) and
each of the other agreements, documents and instruments providing for or
evidencing any First Lien Obligation, and any other document or instrument
executed or delivered at any time in connection with any First Lien Obligations,
including any intercreditor or joinder agreement among holders of First Lien
Obligations, to the extent such are effective at the relevant time, as each may
be modified from time to time; provided that any such modification does not
increase the principal amount of First Lien Loans in excess of the Maximum First
Lien Indebtedness Amount and is otherwise permitted by the provisions of this
Agreement..
"FIRST LIEN LOANS" means "Loans" under and as defined in the First
Lien Credit Agreement.
"FIRST LIEN MORTGAGES" means a collective reference to each
mortgage, deed of trust and any other document or instrument under which any
Lien on real property owned by any Loan Party is granted to secure any First
Lien Obligations or under which rights or remedies with respect to any such
Liens are governed.
"FIRST LIEN OBLIGATIONS" means the "Obligations," as defined in the
First Lien Credit Agreement as in effect as of the date hereof.
"FIRST LIEN SECURED PARTIES" means, at any relevant time, the
holders of First Lien Obligations at such time, including without limitation the
First Lien Lenders, the First Lien Agent and the agents under the First Lien
Credit Agreement.
"FIRST LIEN SECURITY DOCUMENTS" means the Guaranty and Security
Agreement (as defined in the First Lien Credit Agreement), the First Lien
Mortgages and any other agreement, document or instrument pursuant to which a
Lien is granted or purported to be granted securing any First Lien Obligations
or under which rights or remedies with respect to such Liens are governed.
"FIRST PRIORITY LIENS" means all Liens on the First Lien Collateral
to secure the First Lien Obligations, whether created under the First Lien
Security Documents or acquired by possession, statute, operation of law,
subrogation or otherwise.
"GUARANTORS" means Holdings and each other Person that has executed
a guarantee with respect to the First Lien Obligations or the Second Lien
Obligations.
-4-
"HOLDINGS" has the meaning set forth in the recitals hereto.
"INDEBTEDNESS" means and includes all obligations that constitute
"Indebtedness" within the meaning of the First Lien Credit Agreement or the
Second Lien Credit Agreement.
"INITIAL FIRST LIEN CREDIT AGREEMENT" has the meaning set forth in
the recitals hereto.
"INITIAL SECOND LIEN CREDIT AGREEMENT" has the meaning set forth in
the recitals hereto.
"INSOLVENCY OR LIQUIDATION PROCEEDING" means, with respect to any
person, any (a) insolvency, bankruptcy, receivership, reorganization,
readjustment, composition or other similar proceeding relating to such person or
its property or creditors in such capacity, (b) proceeding for any liquidation,
dissolution or other winding up of such person, voluntary or involuntary,
whether or not involving insolvency or proceedings under the Bankruptcy Code,
whether partial or complete and whether by operation of law or otherwise, (c)
assignment for the benefit of creditors of such person or (d) other marshalling
of the assets of such person.
"LIEN" means, with respect to any asset, any mortgage, deed of
trust, lien, pledge, hypothecation or security interest in, on or of such asset.
"LOAN PARTIES" means the Borrower, Holdings and each of the
Guarantors that have executed and delivered, or may from time to time hereafter
execute and deliver, a First Lien Security Document or a Second Lien Security
Document.
"MAXIMUM FIRST LIEN INDEBTEDNESS AMOUNT" means, as of any date of
determination, $1,207,500,000 plus (a) 115% of the principal amount of any
Facilities Increase of the Term Loan Facility (each as defined in the First Lien
Credit Agreement as in effect on the date hereof), plus (b) any interest on such
amount, plus (c) the obligations arising under any Secured Hedging Agreement,
plus interest thereon, plus (d) any fees, attorneys' fees, costs, expenses, and
indemnities payable under the First Lien Loan Documents, minus (e) the aggregate
amount of all permanent reductions of the Revolving Credit Commitment (as
defined in the First Lien Credit Agreement) made from and after the date hereof,
minus (f) the aggregate amount of all principal payments and prepayments of the
Term Loan (as defined in the First Lien Credit Agreement) including any Term
Loan made as part of any Facilities Increase, actually received by the First
Lien Agent or the First Lien Lenders.
"MAXIMUM SECOND LIEN INDEBTEDNESS AMOUNT" means, as of any date of
determination, (a) $250,000,000 plus (b) any interest on the amount described in
clause (a) (including any interest that has been paid-in-kind and added to the
principal amount of the Second Lien Obligations), plus (c) any fees, attorneys'
fees, costs, expenses, and indemnities payable under the Second Lien Loan
Documents, minus (d) the aggregate amount of all principal payments and
prepayments of the Second Lien Obligations actually received by the Second Lien
Agent or the Second Lien Lenders.
-5-
"NEW AGENT" has the meaning set forth in Section 5.6.
"PERSON" means "person" under and as defined in the First Lien
Credit Agreement. "PLEDGED COLLATERAL" has the meaning set forth in Section 5.5
hereof.
"PURCHASE EVENT" has the meaning set forth in Section 5.7 hereof.
"RECOVERY" has the meaning set forth in Section 6.5 hereof.
"REFINANCE" means, in respect of any indebtedness, to refinance,
extend, renew, defease, amend, modify, supplement, restructure, replace, refund
or repay, or to issue other indebtedness, in exchange or replacement for, such
indebtedness. "Refinanced" and "REFINANCING" shall have correlative meanings.
"SECOND LIEN AGENT" has the meaning set forth in the preamble
hereof.
"SECOND LIEN COLLATERAL" means all of the assets and property of any
Loan Party, whether real, personal or mixed, with respect to which a Lien is
granted or purported to be granted as security for any Second Lien Obligations.
"SECOND LIEN CREDIT AGREEMENT" means (i) the Initial Second Lien
Credit Agreement and (ii) any other credit agreement, loan agreement, note
agreement, promissory note, indenture or other agreement or instrument
evidencing or governing the terms of any indebtedness or other financial
accommodation that has been incurred to extend or Refinance (subject to the
limitations set forth herein and in the First Lien Credit Agreement) in whole or
in part the indebtedness and other obligations outstanding under (x) the credit
agreement referred to in clause (i) or (y) any subsequent Second Lien Credit
Agreement, unless such agreement or instrument expressly provides that it is not
intended to be and is not a Second Lien Credit Agreement hereunder. Any
reference to the Second Lien Credit Agreement hereunder shall be deemed a
reference to any Second Lien Credit Agreement then in existence.
"SECOND LIEN LENDERS" means the "Lenders" under and as defined in
the Second Lien Credit Agreement.
"SECOND LIEN LOAN DOCUMENTS" means the Second Lien Credit Agreement
and the other Loan Documents (as defined in the Second Lien Credit Agreement)
and each of the other agreements, documents and instruments providing for or
evidencing any Second Lien Obligation, and any other document or instrument
executed or delivered at any time in connection with any Second Lien
Obligations, as the same may be modified from time to time; provided that any
such modification does not increase the principal amount of Second Lien Loans in
excess of the Maximum Second Lien Indebtedness Amount and is otherwise in
accordance with and permitted by the provisions of the First Lien Credit
Agreement and this Agreement.
-6-
"SECOND LIEN LOANS" means "Loans" under and as defined in the Second
Lien Credit Agreement.
"SECOND LIEN MORTGAGES" means a collective reference to each
mortgage, deed of trust and any other document or instrument under which any
Lien on real property owned by any Loan Party is granted to secure any Second
Lien Obligations or under which rights or remedies with respect to any such
Liens are governed.
"SECOND LIEN OBLIGATIONS" means the "Obligations," as defined in the
Second Lien Credit Agreement, as in effect as of the date hereof.
"SECOND LIEN RELEASE" has the meaning set forth in Section 5.1.
"SECOND LIEN SECURED PARTIES" means, at any relevant time, the
holders of Second Lien Obligations at such time, including without limitation
the Second Lien Lenders and the agents under the Second Lien Credit Agreement.
"SECOND LIEN SECURITY DOCUMENTS" means the Guaranty and Security
Agreement (as defined in the Second Lien Credit Agreement), the Second Lien
Mortgages and any other agreement, document or instrument pursuant to which a
Lien is granted securing any Second Lien Obligations or under which rights or
remedies with respect to such Liens are governed.
"SECOND PRIORITY LIENS" means all Liens on the Second Lien
Collateral to secure the Second Lien Obligations, whether created under the
Second Lien Security Documents or acquired by possession, statute, operation of
law, subrogation or otherwise.
"SECURED HEDGING AGREEMENT" has the meaning ascribed to such term in
the First Lien Credit Agreement.
"STANDSTILL PERIOD" has the meaning set forth in Section 3.1 hereof.
"SUBSIDIARY" has the meaning ascribed to such term in the First Lien
Credit Agreement.
"UNIFORM COMMERCIAL CODE" or "UCC" means the Uniform Commercial Code
(or any similar or equivalent legislation) as in effect in any applicable
jurisdiction.
1.3 Terms Generally. 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 (a) any definition of or reference to any
agreement, instrument or other document herein shall be construed as referring
to such agreement, instrument or other document as from time to time amended,
supplemented or otherwise modified (subject to any restrictions on such
amendments, supplements or
-7-
modifications set forth herein), (b) any reference herein to any Person shall be
construed to include such Person's successors and assigns, (c) the words
"herein," "hereof" and "hereunder," and words of similar import, shall be
construed to refer to this Agreement in its entirety and not to any particular
provision hereof, (d) all references herein to Sections shall be construed to
refer to Sections of this Agreement, (e) any reference to any law or regulation
herein shall refer to such law or regulation as amended, modified or
supplemented from time to time and (f) 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.
SECTION 2.LIEN PRIORITIES.
2.1 Relative Priorities. Anything in this Agreement to the contrary
notwithstanding, and notwithstanding the date, manner or order of grant,
attachment or perfection of any Liens securing the Second Lien Obligations
granted on the Collateral or of any Liens securing the First Lien Obligations
granted on the Collateral, and notwithstanding any provision of the UCC, any
other applicable law, the First Lien Loan Documents or the Second Lien Loan
Documents, or any defect or deficiencies in, or failure to perfect or lapse in
perfection of, or avoidance as a fraudulent conveyance or otherwise of, the
Liens securing the First Lien Obligations or any other circumstance whatsoever,
each of the First Lien Agent, for itself and on behalf of the other First Lien
Secured Parties, and the Second Lien Agent, for itself and on behalf of the
other Second Lien Secured Parties, hereby agrees that (a) any First Priority
Lien now or hereafter held by or for the benefit of any First Lien Secured
Party, to the extent that the First Priority Liens secure the First Lien
Obligations up to the Maximum First Lien Indebtedness Amount, shall be senior
and prior in right to any and all Second Priority Liens; (b) any Second Priority
Lien now or hereafter held by or for the benefit of any Second Lien Secured
Party shall be junior and subordinate in right to any and all First Priority
Liens to the extent that such First Priority Liens secure the First Lien
Obligations up to the Maximum First Lien Indebtedness Amount; (c) any First
Priority Lien now or hereafter held by or for the benefit of any First Lien
Secured Party, to the extent that the First Priority Liens secure the Excess
First Lien Loan Amount, shall be junior and subordinate to any and all Second
Priority Liens, to the extent that such Liens secure the Second Lien Obligations
up to the Maximum Second Lien Indebtedness Amount; (d) any Second Priority Lien
now or hereafter held by or for the benefit of any Second Lien Secured Party, to
the extent that the Second Priority Liens secure the Second Lien Obligations up
to the Maximum Second Lien Indebtedness Amount, shall be senior and prior in
right to any and all First Priority Liens, to the extent that such Liens secure
the Excess First Lien Loan Amount; (e) any First Priority Lien now or hereafter
held by or for the benefit of any First Lien Secured Party, to the extent that
the First Priority Liens secure the Excess First Lien Loan Amount, shall be
senior and prior in right to any and all Second Priority Liens, to the extent
that such Liens secure the Second Lien Obligations in excess of the Maximum
Second Lien Indebtedness Amount; and (f) any Second Priority Lien now or
hereafter held by or for the benefit of any Second Lien Secured Party, to the
extent that the Second Priority Liens secure the Second Lien Obligations in
excess of the Maximum Second Lien Indebtedness Amount, shall be junior and
subordinate in right to any and all First Priority Liens. All Liens on the
Collateral
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securing any First Lien Obligations shall have the priority provided above in
all respects and prior to all Liens on the Collateral securing any Second Lien
Obligations to the extent provided above for all purposes, whether or not such
Liens securing any First Lien Obligations are subordinated to any Lien securing
any other obligation of the Borrower, any other Loan Party or any other Person.
The Second Lien Agent for itself and on behalf of the Second Lien Secured
Parties expressly agrees that any Lien purported to be granted on any Collateral
as security for the First Lien Obligations shall be and remain senior in all
respects and prior to all Liens on the Collateral securing any Second Lien
Obligations to the extent provided above for all purposes regardless of whether
the Lien purported to be granted is found to be improperly granted, improperly
perfected, a fraudulent conveyance or legally or otherwise deficient in any
manner.
2.2 Prohibition on Contesting Liens. Each of the Second Lien Agent,
for itself and on behalf of each Second Lien Secured Parties, and the First Lien
Agent, for itself and on behalf of each First Lien Secured Parties, agrees that
it shall not (and hereby waives any right to) contest or support any other
Person in contesting, in any proceeding (including any Insolvency or Liquidation
Proceeding), the priority, validity or enforceability of a Lien held by or on
behalf of any of the First Lien Secured Parties in the First Lien Collateral or
by or on behalf of any of the Second Lien Secured Parties in the Collateral, as
the case may be; provided that nothing in this Agreement shall be construed to
prevent or impair the rights of the First Lien Agent, any First Lien Secured
Parties, the Second Lien Agent or any Second Lien Secured Parties to enforce
this Agreement, including the priority of the Liens securing the First Lien
Obligations and the Second Lien Obligations as provided in Sections 2.1 and 3.1
of this Agreement.
2.3 No New Liens. So long as the Discharge of First Lien Obligations
has not occurred, the parties hereto agree that the Borrower and Holdings shall
not, and shall not permit any of their Subsidiaries to, (i) grant or permit any
additional Liens on any asset or property to secure any Second Lien Obligation
unless it has granted a Lien on such asset or property to secure the First Lien
Obligations, and (ii) grant or permit any additional Liens on any asset to
secure any First Lien Obligations unless it has granted a Lien on such asset to
secure the Second Lien Obligations. To the extent that the foregoing provisions
are not complied with for any reason, without limiting any other rights and
remedies available to the First Lien Agent, the First Lien Secured Parties, the
Second Lien Agent and/or the Second Lien Secured Parties, the Second Lien Agent,
on behalf of Second Lien Secured Parties, and the First Lien Agent, for itself
and on behalf of the First Lien Secured parties, agree that any amounts received
by or distributed to any of them pursuant to or as a result of Liens granted in
contravention of this Section 2.3 shall be subject to Section 4.2.
2.4 Similar Liens and Agreements. The parties hereto agree that it
is their intention that the First Lien Collateral and the Second Lien Collateral
be identical. In furtherance of the foregoing and of Section 8.9, the parties
hereto agree, subject to the other provisions of this Agreement:
(a) upon request by the First Lien Agent or the Second Lien Agent,
to cooperate in good faith (and to direct their counsel to cooperate in
good faith) from time to time in order to determine the specific items
included in the First Lien Collateral and
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the Second Lien Collateral and the steps taken to perfect their respective
Liens thereon and the identity of the respective parties obligated under
the First Lien Loan Documents and the Second Lien Loan Documents; and
(b) that the documents and agreements creating or evidencing the
First Lien Collateral and the Second Lien Collateral shall be in all
material respects the same forms of documents other than with respect to
(i) the first lien and the second lien nature of the obligations
thereunder and (ii) the delivery of Collateral, the security interest in
which may be perfected only by possession or control by a single person of
such Collateral prior to the Discharge of First Lien Obligations.
SECTION 3. ENFORCEMENT.
3.1 Exercise of Remedies.
(a) So long as the Discharge of First Lien Obligations has not
occurred, whether or not any Insolvency or Liquidation Proceeding has been
commenced by or against the Borrower or any other Loan Party: (i) the Second
Lien Agent and the Second Lien Secured Parties (x) will not exercise or seek to
exercise any rights or remedies (other than enforcing reporting, inspection or
similar rights) with respect to any Collateral (including, without limitation,
the exercise of any right under any lockbox agreement, account control
agreement, landlord waiver or bailee's letter or similar agreement or
arrangement to which the Second Lien Agent or any Second Lien Secured Parties is
a party or the enforcement of or execution on any judgment Lien) or institute
any action or proceeding with respect to such rights or remedies (including any
action of foreclosure); provided, that the Second Lien Agent may exercise any or
all such rights (but not rights the exercise of which is otherwise prohibited by
this Agreement including Section 6 hereof) after a period (the "STANDSTILL
PERIOD") of 120 consecutive days has elapsed from the date of delivery of
written notice to the First Lien Agent stating that the existence of any Event
of Default as defined under the Second Lien Credit Agreement has occurred and is
continuing thereunder and stating its intention to exercise its rights to take
such actions only so long as the First Lien Agent or First Lien Secured Parties
have not commenced (or attempted to commence or given notice of its intent to
commence) the exercise of any of their rights or remedies with respect to all or
a material portion of the Collateral (including seeking relief from the
automatic stay or any other stay in any Insolvency or Liquidation Proceeding),
(y) will not contest, protest or object to any foreclosure proceeding or action
brought by the First Lien Agent or any First Lien Secured Party or any other
exercise by the First Lien Agent or any First Lien Secured Party of any rights
and remedies relating to the Collateral under the First Lien Loan Documents or
otherwise, and (z) will not object to the forbearance by the First Lien Agent or
the First Lien Secured Parties from bringing or pursuing any foreclosure
proceeding or action or any other exercise of any rights or remedies relating to
the Collateral, in each case so long as the respective interests of the Second
Lien Secured Parties attach to the proceeds thereof subject to the relative
priorities described in Section 2 hereof; and (ii) the First Lien Agent and the
First Lien Secured Parties shall have the exclusive right to enforce rights,
exercise remedies (including setoff and the right to credit bid debt, except as
set forth in clause (E), below) and make determinations regarding the release,
disposition, or restrictions with respect to the Collateral
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without any consultation with or the consent of the Second Lien Agent or any
Second Lien Secured Party (as set forth in Section 5.1 hereof); provided, that
(A) in any Insolvency or Liquidation Proceeding commenced by or against the
Borrower or any other Loan Party, the Second Lien Agent or the Second Lien
Secured Parties may file a proof of claim or statement of interest with respect
to the Second Lien Obligations, (B) the Second Lien Secured Parties shall be
entitled to file any necessary responsive or defensive pleadings in opposition
to any motion, claim, adversary proceeding or other pleading made by any person
objecting to or otherwise seeking the disallowance of the claims of the Second
Lien Secured Parties, including without limitation any claims secured by the
Collateral, if any, in each case if not otherwise in contravention of the terms
of this Agreement, (C) the Second Lien Secured Parties shall be entitled to file
any pleadings, objections, motions or agreements which assert rights or
interests available to unsecured creditors of the Loan Parties arising under
either the Bankruptcy Code or applicable non-bankruptcy law, in each case if not
otherwise in contravention of the terms of this Agreement, (D) the Second Lien
Secured Parties shall be entitled to file any proof of claim and other filings
and make any arguments and motions in order to preserve or protect its Liens on
the Collateral that are, in each case, not otherwise in contravention of the
terms of this Agreement, with respect to the Second Lien Obligations and the
Collateral, (E) the Second Lien Agent may credit bid the Second Lien Obligations
so long as, if as a result thereof, the First Lien Secured Parties will receive
at least the same amount of cash that they would have received if the next
highest bidder had prevailed and (F) the Second Lien Agent or any Second Lien
Secured Party may exercise any of its rights or remedies with respect to the
Collateral after the termination of the Standstill Period to the extent
permitted by clause (i)(x) above. In exercising rights and remedies with respect
to the Collateral, the First Lien Agent and the First Lien Secured Parties may
enforce the provisions of the First Lien Loan Documents and exercise remedies
thereunder, all in such order and in such manner as they may determine in the
exercise of their sole discretion. Such exercise and enforcement shall include
the rights of an agent appointed by them to sell or otherwise dispose of
Collateral upon foreclosure, to incur expenses in connection with such sale or
disposition, and to exercise all the rights and remedies of a secured creditor
under the Uniform Commercial Code of any applicable jurisdiction and of a
secured creditor under Bankruptcy Laws or other applicable laws of any
applicable jurisdiction. The First Lien Agent agrees to provide the lesser of
(x) five (5) days' or (y) the number of days remaining in the Standstill Period,
notice to the Second Lien Agent of its intent to exercise and enforce its rights
or remedies with respect to the Collateral (including the "Exercise of Remedies"
as defined in Section 5.1(a)(i)). If the Second Lien Agent or any Second Lien
Secured Party exercises any rights or remedies with respect to the Collateral in
accordance with clause (i)(x) of the first sentence of this paragraph and
thereafter the First Lien Agent or First Lien Secured Parties commence (or
attempt to commence or given notice of their intent to commence) the exercise of
any of their rights or remedies with respect to all or a material portion of the
Collateral (including seeking relief from the automatic stay or any other stay
in any Insolvency or Liquidation Proceeding), the Standstill Period shall
recommence and the Second Lien Agent and the Second Lien Secured Parties shall
rescind to the extent possible any such rights or remedies already exercised
with respect to the Collateral.
(b) The Second Lien Agent, on behalf of itself and the Second Lien
Secured Parties, agrees that, it will not take or receive any Collateral or any
proceeds of Collateral in
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connection with the exercise of any right or remedy (including setoff) with
respect to any Collateral, unless and until the Discharge of First Lien
Obligations has occurred. Without limiting the generality of the foregoing,
unless and until the Discharge of First Lien Obligations has occurred, except as
expressly permitted by of this Agreement, the sole right of the Second Lien
Agent and the Second Lien Secured Parties with respect to the Collateral is to
hold a Lien on the Collateral pursuant to the Second Lien Security Documents for
the period and to the extent granted therein and to receive a share of the
proceeds thereof, if any, after the Discharge of First Lien Obligations has
occurred in accordance with the terms of the Second Lien Loan Documents and
applicable law.
(c) (i) The Second Lien Agent, except as permitted by Section
3.1(a)(i)(x), for itself and on behalf of the Second Lien Secured Parties,
agrees that the Second Lien Agent and the Second Lien Secured Parties will not
take any action that would hinder any exercise of remedies under the First Lien
Loan Documents, including any sale, lease, exchange, transfer or other
disposition of the Collateral, whether by foreclosure or otherwise, and (ii) the
Second Lien Agent, for itself and on behalf of the Second Lien Secured Parties,
hereby waives any and all rights it or the Second Lien Secured Parties may have
as a junior lien creditor or otherwise to object to the manner in which the
First Lien Agent or the First Lien Secured Parties seek to enforce or collect
the First Lien Obligations or the Liens granted in any of the Collateral,
regardless of whether any action or failure to act by or on behalf of the First
Lien Agent or First Lien Secured Parties is adverse to the interests of the
Second Lien Secured Parties.
(d) The Second Lien Agent hereby acknowledges and agrees that no
covenant, agreement or restriction contained in the Second Lien Security
Documents or any other Second Lien Loan Document shall be deemed to restrict in
any way the rights and remedies of the First Lien Agent or the First Lien
Secured Parties with respect to the Collateral as set forth in this Agreement
and the First Lien Loan Documents.
3.2 Cooperation. During a Standstill Period, the Second Lien Agent,
on behalf of itself and the Second Lien Secured Parties, agrees that, unless and
until the Discharge of First Lien Obligations has occurred, it will not
commence, or join with any Person in commencing, any enforcement, collection,
involuntary petition, execution, levy or foreclosure action or proceeding
(including, without limitation, any Insolvency or Liquidation Proceeding) with
respect to any Lien held by it under the Second Lien Security Documents or any
other Second Lien Loan Document or otherwise.
SECTION 4. PAYMENTS.
4.1 Application of Proceeds. All Collateral or proceeds thereof
resulting from any Disposition (including any such Disposition pursuant to
Section 363 of the Bankruptcy Code or any comparable provision of any Bankruptcy
Law), or collection or realization on such Collateral upon the enforcement or
exercise of any right or remedy (including any right of setoff) or in connection
with any Insolvency or Liquidation Proceeding, together with assets or proceeds
subject to Liens referred to in the final sentence of Section 2.3, shall be
applied as follows: (a) first, to the First Lien Agent for application to the
First Lien Obligations up to the Maximum First Lien Indebtedness Amount in
accordance with the First Lien Loan Documents; (b) second,
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to the Second Lien Agent for application to the Second Lien Obligations up to
the Maximum Second Lien Indebtedness Amount in accordance with the Second Lien
Loan Documents; (c) third, to the First Lien Agent for application to the Excess
First Lien Loan Amount in accordance with the First Lien Loan Documents, until
the Discharge of First Lien Obligations; and (d) thereafter, to the Second Lien
Agent for application to the Second Lien Obligations in excess of the Maximum
Second Lien Indebtedness Amount, until the Discharge of Second Lien Obligations.
The Revolving Credit Commitment (as defined in the First Lien Credit Agreement)
shall be permanently reduced by the amount applied to any Revolving Loan (as
defined in the First Lien Credit Agreement) pursuant to clauses (a) or (c)
above.
4.2 Payments Over. So long as the Discharge of First Lien
Obligations has not occurred, any Collateral or proceeds thereof (together with
assets or proceeds subject to Liens referred to in the final sentence of Section
2.3) received by the Second Lien Agent or any other Second Lien Secured Party
and required to be applied to the First Lien Obligations pursuant to Section 4.1
shall be segregated and held in trust and forthwith transferred or paid over to
the First Lien Agent for the benefit of the First Lien Secured Parties in the
same form as received, together with any necessary endorsements, or as a court
of competent jurisdiction may otherwise direct, to be applied in accordance with
Section 4.1. So long as the Discharge of Second Lien Obligations has not
occurred, any Collateral or proceeds thereof (together with assets or proceeds
subject to Liens referred to in the final sentence of Section 2.3) received by
the First Lien Agent or any other First Lien Secured Party and required to be
applied to the Second Lien Obligations pursuant to Section 4.1 shall be
segregated and held in trust and forthwith transferred or paid over to the
Second Lien Agent for the benefit of the Second Lien Secured Parties in the same
form as received, together with any necessary endorsements, or as a court of
competent jurisdiction may otherwise direct, to be applied in accordance with
Section 4.1.
SECTION 5. OTHER AGREEMENTS.
5.1 Releases.
(a) Until the Discharge of First Lien Obligations, if in connection
with:
(i) the exercise of any of First Lien Agent's remedies in respect of
the Collateral provided for in Section 3.1, including any sale, lease,
exchange, transfer or other disposition of any such Collateral, including,
any sale under Section 363 of the Bankruptcy Code to the extent supported
by the First Lien Agent, (a) by or at the direction of the First Lien
Agent, or (b) by any Loan Party after the occurrence and during the
continuance of an Event of Default under the First Loan Documents in
connection with the collection by the First Lien Agent of the First Lien
Obligations (an "EXERCISE OF REMEDIES"); or
(ii) any sale, lease, exchange, transfer or other disposition
(collectively, a "DISPOSITION") of any Collateral permitted under the
terms of the First Lien Loan Documents (whether or not an Event of Default
thereunder, and as defined therein, has occurred and is continuing);
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the First Lien Agent, for itself or on behalf of any of the First Lien Secured
Parties, releases any of its Liens on any part of the Collateral, or releases
any Loan Party from its obligations under its guaranty of the First Lien
Obligations, then the Liens, if any, of the Second Lien Agent, for itself or for
the benefit of the Second Lien Secured Parties, on such Collateral, and the
obligations of such Loan Party under its guaranty of the Second Lien
Obligations, shall be automatically, unconditionally and simultaneously released
(the "SECOND LIEN RELEASE") and the Second Lien Agent, for itself or on behalf
of any such Second Lien Secured Parties, promptly shall execute and deliver to
the First Lien Agent such termination statements, releases and other documents
as the First Lien Agent may request to effectively confirm such release;
provided, however, that the Second Lien Release shall not occur without the
consent of the Second Lien Agent (x) in the case of an Exercise of Remedies, as
to any Collateral the net proceeds of the disposition of which will not be
applied to repay (and, in the case of revolving loans (including swingline
loans), to reduce permanently commitments with respect to) the First Lien
Obligations and/or the Second Lien Obligations in accordance herewith or (y) in
the case of a Disposition, if the Disposition is prohibited by any provision of
the Second Lien Credit Agreement.
(b) Until the Discharge of First Lien Obligations occurs, the Second
Lien Agent, for itself and on behalf of the Second Lien Secured Parties, hereby
irrevocably constitutes and appoints the First Lien Agent and any officer or
agent of the First Lien Agent, with full power of substitution, as its true and
lawful attorney-in-fact, coupled with an interest, with full irrevocable power
and authority in the place and stead of the Second Lien Agent or such holder or
in the First Lien Agent's own name, from time to time in the First Lien Agent's
discretion, for the purpose of carrying out the terms of this Section 5.1, to
take any and all appropriate action and to execute any and all documents and
instruments which may reasonably be necessary or desirable to accomplish the
purposes of this Section 5.1, including any endorsements or other instruments of
transfer or release.
(c) Until the Discharge of First Lien Obligations occurs, to the
extent that the First Lien Secured Parties (i) have released any Lien on
Collateral and any such Lien is later reinstated or (ii) obtain any new first
priority Liens, then the Second Lien Secured Parties shall be at the time of
such reinstatement granted a second priority Lien on any such Collateral.
5.2 Insurance; Condemnation. Unless and until the Discharge of First
Lien Obligations has occurred, the First Lien Agent and the First Lien Secured
Parties shall have the sole and exclusive right, subject to the rights of the
Loan Parties under the First Lien Loan Documents, to adjust settlement for any
insurance policy covering the Collateral on which it holds a Lien in the event
of any loss thereunder and to approve any award granted in any condemnation or
similar proceeding (or any deed in lieu of condemnation) affecting the
Collateral on which it holds a Lien. Unless and until the Discharge of First
Lien Obligations has occurred, and subject to the rights of the Loan Parties
under the First Lien Loan Documents, all proceeds of any such policy and any
such award (or any payments with respect to a deed in lieu of condemnation) if
in respect to the Collateral shall be paid to the First Lien Agent for the
benefit of the First Lien Secured Parties pursuant to the terms of the First
Lien Loan Documents (including, without limitation, for purposes of cash
collateralization of commitments, letters of credit and Secured Hedging
Agreement) and thereafter, to the extent no First Lien Obligations
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are outstanding, to the Second Lien Agent for the benefit of the Second Lien
Secured Parties to the extent required under the Second Lien Security Documents
and then, to the extent no Second Lien Obligations are outstanding, to the owner
of the subject property, such other Person as may be entitled thereto or as a
court of competent jurisdiction may otherwise direct. Until the Discharge of
First Lien Obligations has occurred, if the Second Lien Agent or any Second Lien
Secured Party shall, at any time, receive any proceeds of any such insurance
policy or any such award or payment in contravention of this Agreement, it shall
pay such proceeds over to the First Lien Agent in accordance with the terms of
Section 4.2 of this Agreement.
5.3 Amendments to First Lien Loan Documents and Second Lien Loan
Documents.
(a) The First Lien Loan Documents may be amended, restated,
supplemented or otherwise modified in accordance with their terms and the First
Lien Credit Agreement may be Refinanced in each case, without the consent of the
Second Lien Agent or the Second Lien Lenders; provided, that (i) the holders of
any such Refinancing debt (or their agent on their behalf) shall bind themselves
in writing to the terms of this Agreement and (ii) that any such amendment,
supplement or modification (or definitive document pursuant to which the First
Lien Credit Agreement is Refinanced) shall not (A) increase the aggregate
principal or face amount of First Lien Loans (or commitments therefore) in
excess of the Maximum First Lien Indebtedness Amount, (B) increase the
"applicable margin" or similar component of the interest rate or any scheduled
recurring fee by more than 3.00% per annum (excluding increases resulting from
the accrual of interest at the default rate in effect as of the date hereof);
(C) change (to earlier dates) any dates upon which payments of principal or
interest are due; (D) directly prohibit or restrict the payment of principal of,
interest on, or other amounts payable with respect to the Second Lien
Obligations to a greater extent than the same is prohibited or restricted by the
First Lien Credit Agreement as in effect on the date hereof; (E) extend the
final scheduled maturity date of the First Lien Obligations to a date later than
June 26, 2014, (F) increase the default rate above 2.00%, or (G) subordinate in
right of payment any of the First Lien Obligations, or subordinate the lien on
any of the Collateral securing the First Lien Obligations other than in
connection with a DIP Financing entered into in compliance with Section 6.1.
(b) The Second Lien Loan Documents may be amended, restated,
supplemented or otherwise modified in accordance with their terms, and the
Second Lien Credit Agreement may be Refinanced, in each case, without the
consent of the First Lien Agent or the First Lien Lenders, but only in
accordance with the provisions of the First Lien Credit Agreement as in effect
on the date hereof; provided that any such amendment, supplement or modification
shall not (A) increase the aggregate principal or face amount of Second Lien
Loans (or commitments therefore) in excess of the Maximum Second Lien
Indebtedness Amount, (B) increase the interest rate applicable thereto
(excluding increases resulting from the accrual of interest at the default rate
in effect as of the date hereof), (C) change (to earlier dates) any dates upon
which payments of principal or interest are due thereon, (D) change any event of
default or condition to an event of default with respect thereto (other than to
eliminate any such event of default or increase any grace period related
thereto) or add any event of default, (E) change any financial maintenance
covenant therein in a manner that would not preserve, on equivalent
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economic terms, the absolute or percentage difference (whichever is greater)
that exists on the date hereof between such numerical threshold or limitation in
the First Lien Credit Agreement and the corresponding threshold or limitation in
the Second Lien Credit Agreement or add any new financial maintenance covenant,
(F) change the prepayment provisions of the Second Lien Credit Agreement or add
any mandatory prepayments thereto, (G) change the lien subordination provisions
thereof (or of any guaranty thereof), (H) change or release any collateral
therefor or subordinate the lien on any of the Collateral securing the Second
Lien Obligations to any other Indebtedness, or (I) make any other amendment
thereof or change thereto, if the effect of such amendment or change with all
other amendments or changes made, is to increase materially the obligations of
the obligors thereunder or to confer any additional rights on the lenders under
the Second Lien Credit Agreement (or a representative on their behalf) that
would be adverse to the Loan Parties under the First Lien Credit Agreement or
any First Lien Lender.
(c) The Second Lien Agent, on behalf of the Second Lien Secured
Parties, agrees that each Second Lien Security Document shall include the
following language (or language to similar effect approved by the First Lien
Agent):
"Notwithstanding anything herein to the contrary, the lien and security
interest granted to the Second Lien Agent pursuant to this Agreement
and the exercise of any right or remedy by the Second Lien Agent
hereunder are subject to the provisions of the Intercreditor Agreement,
dated as of June 26, 2007 (as amended, restated, supplemented or
otherwise modified from time to time, the "INTERCREDITOR AGREEMENT"),
among IM US Holdings, LLC, Inverness Medical Innovations, Inc., General
Electric Capital Corporation, as First Lien Agent, General Electric
Capital Corporation, as Second Lien Agent and certain other persons
party or that may become party thereto from time to time. In the event
of any conflict between the terms of the Intercreditor Agreement and
this Agreement, the terms of the Intercreditor Agreement shall govern
and control."
In addition, the Second Lien Agent, on behalf of the Second Lien Secured
Parties, agrees that each Second Lien Mortgage covering any Collateral shall
contain such other language as the First Lien Agent may reasonably request to
reflect the subordination of such Second Lien Mortgage to the First Lien
Security Document covering such Collateral.
(d) Notwithstanding anything herein to the contrary, the First Lien
Agent agrees that, and shall execute any definitive documentation to give effect
thereto, (i) if any First Lien Loan Document is amended to change any existing
financial covenants, or any such section or other provision of such First Lien
Loan Document is amended to include any additional financial covenants, the
Second Lien Lenders may amend the Second Lien Loan Documents to reflect such
changes, provided that with respect to existing financial covenants, the
absolute or percentage difference (whichever is greater) that exists on the date
hereof between any numerical threshold or limitation in the First Lien Credit
Agreement and the corresponding threshold or limitation in the Second Lien
Credit Agreement as of the date hereof shall be maintained and, with respect to
any new financial covenants, the Second Lien Credit Agreement will have
thresholds or limitations that are less restrictive to the Borrower than the
thresholds or limitations
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in the First Lien Credit Agreement by approximately the amount by which such
thresholds or limitations are set back in from those in the First Lien Credit
Agreement as of the date hereof and (ii) if any provision of any First Lien Loan
Document for which there exists a correlated provision in any Second Lien Loan
Document is amended to add or change any covenant or event of default, the
Second Lien Lenders may amend the Second Lien Loan Documents to reflect such
addition of or change to a covenant or event of default in such Second Lien Loan
Document.
5.4 Rights As Unsecured Creditors. Notwithstanding anything to the
contrary herein, except as otherwise set forth in Sections 2.1 and 3.1 of this
Agreement, the Second Lien Agent and the Second Lien Secured Parties may
exercise rights and remedies as unsecured creditors against any Loan Party in
accordance with the terms of the Second Lien Loan Documents and applicable law.
Except as otherwise set forth in Sections 2.1, 3.1 and 6 of this Agreement, but
subject to the terms of the First Lien Credit Agreement, nothing in this
Agreement shall prohibit the receipt by the Second Lien Agent or any Second Lien
Secured Party of the required payments of interest and principal so long as such
receipt is (i) not the direct or indirect result of the exercise by the Second
Lien Agent or any Second Lien Secured Party of rights or remedies as a secured
creditor (including setoff) or enforcement in contravention of this Agreement of
any Lien held by any of them or (ii) such receipt is not proceeds of any
Collateral. Nothing in this Agreement impairs or otherwise adversely affects any
rights or remedies the First Lien Agent or the First Lien Secured Party may have
with respect to the Collateral.
5.5 Bailee for Perfection.
(a) The First Lien Agent agrees to hold that part of the Collateral
that is in its possession or control (or in the possession or control of its
agents or bailees), to the extent that possession thereof is taken to perfect a
Lien thereon under the Uniform Commercial Code (such Collateral being the
"PLEDGED COLLATERAL") for the benefit of and on behalf of the First Lien Secured
Parties, the Second Lien Agent and the Second Lien Secured Parties and any
assignee solely for the purpose of perfecting the security interest granted
under the First Lien Loan Documents and the Second Lien Loan Documents, subject
to the terms and conditions of this Section 5.5.
(b) Subject to the terms of this Agreement, until the Discharge of
First Lien Obligations has occurred, the First Lien Agent shall be entitled to
deal with the Pledged Collateral in accordance with the terms of the First Lien
Loan Documents as if the Liens of the Second Lien Agent under the Second Lien
Security Documents did not exist. The rights of the Second Lien Agent shall at
all times be subject to the terms of this Agreement and to the First Lien
Agent's rights under the First Lien Loan Documents.
(c) The First Lien Agent shall have no obligation whatsoever to the
First Lien Secured Parties and the Second Lien Agent or any Second Lien Secured
Party to ensure that the Pledged Collateral is genuine or owned by any of the
Loan Parties or to preserve rights or benefits of any Person except as expressly
set forth in this Section 5.5. The duties or responsibilities of the First Lien
Agent under this Section 5.5 shall be limited solely to holding
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the Pledged Collateral for the benefit of and on behalf of the First Lien
Secured Parties and the Second Lien Agent and any permitted assignee in
accordance with this Section 5.5.
(d) The First Lien Agent acting pursuant to this Section 5.5 shall
not have by reason of the First Lien Security Documents, the Second Lien
Security Documents, this Agreement or any other document or theory a fiduciary
relationship in respect of the First Lien Secured Parties, the Second Lien Agent
or any Second Lien Secured Party.
(e) Upon the Discharge of First Lien Obligations under the First
Lien Loan Documents to which the First Lien Agent is a party, the First Lien
Agent shall deliver the remaining Pledged Collateral (if any) together with any
necessary endorsements, first, to the Second Lien Agent to the extent Second
Lien Obligations remain outstanding, and second, to the Borrower to the extent
no First Lien Obligations (other than contingent indemnification obligations as
to which no claim has been asserted) or Second Lien Obligations (other than
contingent indemnification obligations as to which no claim has been asserted)
remain outstanding (in each case, so as to allow such Person to obtain control
of such Pledged Collateral). The First Lien Agent further agrees to take all
other action reasonably requested by such Person in connection with such Person
obtaining, as applicable, a first-priority security interest in, ownership or
release of the Collateral or as a court of competent jurisdiction may otherwise
direct. Notwithstanding the first in time filing of the First Lien Agent's Liens
upon the Pledged Collateral and notwithstanding anything in Section 7.3 to the
contrary, after the Discharge of First Lien Obligations the First Lien Agent
agrees that the Second Lien Agent's Liens upon the Pledged Collateral shall rank
pari passu with the First Lien Agent's Liens on the Pledged Collateral to the
extent the First Lien Agent's Liens remain in effect to secure any First Lien
Obligations (such as Hedging Agreements) still in effect after the Discharge of
First Lien Obligations. After the Discharge of First Lien Obligations, subject
to Section 5.6, any remaining First Lien Obligations (such as Hedging
Agreements) shall not be entitled to any benefits under this Agreement other
than the right to be secured on a pari passu basis with the Second Lien
Obligations on terms no less advantageous than those of any other Second Lien
Obligations.
5.6 When Discharge of First Lien Obligations Deemed to Not Have
Occurred. If at any time in connection with the Discharge of First Lien
Obligations the Borrower substantially simultaneously therewith enters into any
Refinancing of any First Lien Loan Document evidencing a First Lien Obligation,
then such Discharge of First Lien Obligations shall automatically be deemed not
to have occurred for all purposes of this Agreement, the First Lien Loan
Documents and the Second Lien Loan Documents, and the obligations under such
Refinancing shall automatically be treated as First Lien Obligations for all
purposes of this Agreement, including for purposes of the Lien priorities and
rights in respect of Collateral set forth herein, the related documents shall be
treated as First Lien Loan Documents for all purposes of this Agreement and the
First Lien Agent under such Refinanced First Lien Loan Documents shall be a
First Lien Agent for all purposes of this Agreement. Upon receipt of a notice
stating that the Borrower has entered into a new First Lien Loan Document (which
notice shall include the identity of the new collateral agent, such agent, the
"NEW AGENT"), the Second Lien Agent shall promptly (a) enter into such documents
and agreements (including amendments or supplements to this Agreement) as the
Borrower or such New Agent shall reasonably request
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in order to confirm to the New Agent the rights contemplated hereby, in each
case consistent in all material respects with the terms of this Agreement and
(b) deliver to the New Agent the Pledged Collateral together with any necessary
endorsements (or otherwise allow the New Agent to obtain control of such Pledged
Collateral). If the new First Lien Obligations under the new First Lien Loan
Documents are secured by assets of the Loan Parties of the type constituting
Collateral that do not also secure the Second Lien Obligations, then the Second
Lien Obligations shall be secured at such time by a second priority Lien on such
assets to the same extent provided in the Second Lien Security Documents.
5.7 Purchase Right. Without prejudice to the enforcement of the
First Lien Secured Parties' remedies, the First Lien Secured Parties agree that
following (a) acceleration of the First Lien Obligations in accordance with the
terms of the First Lien Credit Agreement, (b) a payment default under the First
Lien Credit Agreement that has not been cured or waived by the First Lien
Secured Parties within sixty (60) days of the occurrence thereof or (c) the
commencement of an Insolvency or Liquidation Proceeding (each, a "PURCHASE
EVENT"), within thirty (30) days of the Purchase Event, one or more of the
Second Lien Secured Parties may request, and the First Lien Secured Parties
hereby offer the Second Lien Secured Parties the option, to purchase all, but
not less than all, of the aggregate amount of outstanding First Lien Obligations
outstanding at the time of purchase at par, plus any premium that would be
applicable upon prepayment of such First Lien Obligations and accrued and unpaid
interest and fees, without warranty or representation or recourse (except for
representations and warranties required to be made by assigning lenders pursuant
to the Assignment (as such term is defined in the First Lien Credit Agreement)).
If such right is exercised, the parties shall endeavor to close promptly
thereafter but in any event within ten (10) Business Days of the request. If one
or more of the Second Lien Secured Parties exercise such purchase right, it
shall be exercised pursuant to documentation mutually acceptable to each of the
First Lien Agent and the Second Lien Agent. If none of the Second Lien Secured
Parties exercise such right, the First Lien Secured Parties shall have no
further obligations pursuant to this Section 5.7 for such Purchase Event and may
take any further actions in their sole discretion in accordance with the First
Lien Loan Documents and this Agreement.
SECTION 6. INSOLVENCY OR LIQUIDATION PROCEEDINGS.
6.1 Finance and Sale Issues. Until the Discharge of First Lien
Obligations has occurred, if the Borrower or any other Loan Party shall be
subject to any Insolvency or Liquidation Proceeding and the First Lien Agent
shall desire to permit the use of cash collateral on which the First Lien Agent
or any other creditor has a Lien or to permit the Borrower or any other Loan
Party to obtain financing (on commercially reasonable terms), whether from the
First Lien Secured Parties or any other entity, under Section 363 or Section 364
of the Bankruptcy Code or any similar Bankruptcy Law (each, a "DIP FINANCING"),
then the Second Lien Agent, on behalf of itself and the Second Lien Secured
Parties, agrees that, so long as the sum of (i) the maximum aggregate principal
amount of Indebtedness, including, without limitation, the aggregate face amount
of letters of credit, that may be outstanding from time to time under such DIP
Financing (including any such portion thereof that constitutes rollover of First
Lien Loans and/or letters of credit under the First Lien Credit Agreement) plus,
without duplication, (ii) the
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aggregate principal amount of First Lien Loans and the aggregate face amount of
letters of credit issued but not reimbursed under the First Lien Credit
Agreement does not exceed the Maximum First Lien Indebtedness Amount and the DIP
Financing is treated as First Lien Obligations hereunder, it will (a) raise no
objection to such use of cash collateral or DIP Financing and will not request
adequate protection or any other relief in connection therewith (except as
expressly agreed by the First Lien Agent or to the extent permitted by Section
6.3 hereof), (b) agrees that notice received two calendar days prior to the
entry of an order approving such usage of cash collateral or approving such
financing shall be adequate notice and (c) to the extent the Liens securing the
First Lien Obligations are subordinated or pari passu with such DIP Financing,
the Second Lien Agent will subordinate its Liens in the Collateral to (x) the
Liens securing such DIP Financing (and all obligations relating thereto), (y)
any adequate protection provided to the First Lien Agent or the First Lien
Secured Parties or (z) any "carve-out" for any professional fees, United States
Trustee fees and any other customary amounts agreed by the First Lien Agent or
First Lien Secured Parties. The Second Lien Agent on behalf of the Second Lien
Secured Parties, agrees that it will raise no objection or oppose a sale or
other disposition of any Collateral free and clear of its Liens or other claims
under Section 363 of the Bankruptcy Code if the First Lien Secured Parties have
consented to such sale or disposition of such assets and the Second Lien Agent
and each other Second Lien Secured Party will be deemed to have consented under
Section 363 of the Bankruptcy Code (and otherwise) to any sale supported by the
First Lien Secured Parties and to have released their Liens in such assets, in
each case so long as the respective interests of the Second Lien Secured Parties
attach to the proceeds thereof subject to the relative priorities described in
Section 2 hereof.
6.2 Relief from the Automatic Stay. Until the Discharge of First
Lien Obligations has occurred, the Second Lien Agent, on behalf of itself and
the Second Lien Secured Parties, agrees that, none of them shall seek relief
from the automatic stay or any other stay in any Insolvency or Liquidation
Proceeding in respect of the Collateral, without the prior written consent of
the First Lien Agent.
6.3 Adequate Protection. The Second Lien Agent, on behalf of itself
and the Second Lien Secured Parties, agrees that none of them shall contest (or
support any other person contesting) (a) any request by the First Lien Agent or
the First Lien Secured Parties for adequate protection, (b) any objection by the
First Lien Agent or the First Lien Secured Parties to any motion, relief, action
or proceeding based on the First Lien Agent or the First Lien Secured Parties
claiming a lack of adequate protection or (c) the payment of interest, fees,
expenses or other amounts to the First Lien Agent or any other First Lien
Secured Party under Section 506(b) or 506(c) of the Bankruptcy Code or
otherwise. Notwithstanding the foregoing provisions in this Section 6.3, in any
Insolvency or Liquidation Proceeding, (i) if the First Lien Secured Parties (or
any subset thereof) are granted adequate protection in the form of additional
collateral in connection with any DIP Financing, then the Second Lien Agent, on
behalf of itself or any of the Second Lien Secured Parties, may seek or request
adequate protection in the form of a Lien on such additional collateral, which
Lien will be subordinated to the Liens securing the First Lien Obligations and
such DIP Financing (and all obligations relating thereto) on the same basis as
the other Liens securing the Second Lien Obligations are so subordinated to the
First Lien Obligations under this Agreement, and (ii) not in limitation of
Section 6.1 hereof, in the
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event the Second Lien Agent, on behalf of itself and the Second Lien Secured
Parties, seeks or requests adequate protection in respect of Second Lien
Obligations and such adequate protection is granted in the form of additional
collateral, then the Second Lien Agent, on behalf of itself or any of the Second
Lien Secured Parties, agrees that the First Lien Agent shall also be granted a
senior Lien on such additional collateral as security for the First Lien
Obligations and for any such DIP Financing provided by the First Lien Secured
Parties and that any Lien on such additional collateral securing the Second Lien
Obligations shall be subordinated to the Liens on such collateral securing the
First Lien Obligations and any such DIP Financing provided by the First Lien
Secured Parties (and all obligations relating thereto) and to any other Liens
granted to the First Lien Secured Parties as adequate protection on the same
basis as the other Liens securing the Second Lien Obligations are so
subordinated to such First Lien Obligations under this Agreement.
6.4 No Waiver. Nothing contained herein shall prohibit or in any way
limit the First Lien Agent or any First Lien Secured Party from objecting in any
Insolvency or Liquidation Proceeding or otherwise to any action taken by the
Second Lien Agent or any of the Second Lien Secured Parties, including the
seeking by the Second Lien Agent or any Second Lien Secured Parties of adequate
protection or the asserting by the Second Lien Agent or any Second Lien Secured
Parties of any of its rights and remedies under the Second Lien Loan Documents
or otherwise.
6.5 Avoidance Issues. If any First Lien Secured Party is required in
any Insolvency or Liquidation Proceeding or otherwise to turn over or otherwise
pay to the estate of the Borrower or any other Loan Party any amount (a
"RECOVERY"), then such First Lien Secured Party shall be entitled to a
reinstatement of First Lien Obligations with respect to all such recovered
amounts. If this Agreement shall have been terminated prior to such Recovery or
any finding of the invalidity of a Lien of the First Lien Agent, this Agreement
shall be reinstated in full force and effect, and such prior termination shall
not diminish, release, discharge, impair or otherwise affect the obligations of
the parties hereto from such date of reinstatement.
6.6 Reorganization Securities. If, in any Insolvency or Liquidation
Proceeding, debt obligations of the reorganized debtor secured by Liens upon any
property of the reorganized debtor are distributed, pursuant to a plan of
reorganization or similar dispositive restructuring plan, both on account of
First Lien Obligations and on account of Second Lien Obligations, then, to the
extent the debt obligations distributed on account of the First Lien Obligations
and on account of the Second Lien Obligations are secured by Liens upon the same
property, the provisions of this Agreement will survive the distribution of such
debt obligations pursuant to such plan and will apply with like effect to the
Liens securing such debt obligations.
6.7 Post-Petition Interest.
(a) Neither the Second Lien Agent nor any Second Lien Secured Party
shall oppose or seek to challenge any claim by the First Lien Agent or any First
Lien Secured Party for allowance in any Insolvency or Liquidation Proceeding of
First Lien Obligations consisting of post-petition interest, fees or expenses to
the extent of the value of the First Lien Secured Party's
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Lien, without regard to the existence of the Lien of the Second Lien Agent on
behalf of the Second Lien Secured Parties on the Collateral.
(b) Neither the First Lien Agent nor any other First Lien Secured
Party shall oppose or seek to challenge any claim by the Second Lien Agent or
any Second Lien Secured Party for allowance in any Insolvency or Liquidation
Proceeding of Second Lien Obligations consisting of post-petition interest, fees
or expenses to the extent of the value of the Lien of the Second Lien Agent on
behalf of the Second Lien Secured Party on the Collateral (after taking into
account the First Lien Collateral).
6.8 Waiver. The Second Lien Agent, for itself and on behalf of the
Second Lien Secured Parties, waives any claim it may hereafter have against any
First Lien Secured Party arising out of the election of any First Lien Secured
Party of the application of Section 1111(b)(2) of the Bankruptcy Code, and/or
out of any cash collateral or financing arrangement or out of any grant of a
security interest in connection with the Collateral in any Insolvency or
Liquidation Proceeding.
6.9 Nature of Obligations; Post-Petition Interest. The Second Lien
Agent, on behalf of the Second Lien Secured Parties, hereby acknowledges and
agrees that (i) the Second Lien Secured Parties' claims against the Loan Parties
in respect of the Collateral constitute junior claims separate and apart (and of
a different class) from the senior claims of the First Lien Secured Parties
against the Loan Parties in respect of the Collateral, (ii) the First Lien
Obligations include all interest that accrues after the commencement of any
Insolvency or Liquidation Proceeding of any Loan Party at the rate provided for
in the applicable Loan Documents governing the same, whether or not a claim for
post-petition interest is allowed or allowable in any such Insolvency or
Liquidation Proceeding and (iii) this Agreement constitutes a "subordination
agreement" under Section 510 of the Bankruptcy Code. To further effectuate the
intent of the parties as provided in the immediately preceding sentence, if it
is held that the claims against the Loan Parties in respect of the Collateral
constitute only one secured claim (rather than separate classes of senior and
junior claims), then the Second Lien Agent, on behalf of the Second Lien Secured
Parties, hereby acknowledges and agrees that all distributions pursuant to
Section 4.1 hereof or otherwise shall be made as if there were separate classes
of senior and junior secured claims against the Loan Parties in respect of the
Collateral (with the effect being that, to the extent that the aggregate value
of the Collateral is sufficient (for this purpose ignoring all claims held by
the Second Lien Agent on behalf of the Second Lien Secured Parties), the First
Lien Secured Parties shall be entitled to receive, in addition to amounts
distributed to them in respect of principal, pre-petition interest and other
claims, all amounts owing in respect of post-petition interest at the relevant
contract rate (even though such claims may or may not be allowed in whole or in
part in the respective Insolvency or Liquidation Proceeding) before any
distribution is made in respect of the claims held by the Second Lien Agent, on
behalf of the Second Lien Secured Parties, with the Second Lien Agent, on behalf
of the Second Lien Secured Parties, hereby acknowledging and agreeing to turn
over to the holders of the First Lien Obligations all amounts otherwise received
or receivable by them to the extent needed to effectuate the intent of this
sentence even if such turnover of amounts has the effect of reducing the amount
of the claim of the Second Lien Secured Parties).
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6.10 Proofs of Claim. Subject to the limitations set forth in this
Agreement, the First Lien Agent may file proofs of claim and other pleadings and
motions with respect to any First Lien Obligations, any Second Lien Obligations
or the Collateral in any Insolvency or Liquidation Proceeding. If a proper proof
of claim has not been filed in the form required in such Insolvency or
Liquidation Proceeding at least ten (10) days prior to the expiration of the
time for filing thereof, the First Lien Agent shall have the right (but not the
duty) to file an appropriate claim for and on behalf of the Second Lien Secured
Parties with respect to any of the Second Lien Obligations or any of the
Collateral. In furtherance of the foregoing, the Second Lien Agent hereby
appoints the First Lien Agent as its attorney-in-fact, with full authority in
the place and stead of the Second Lien Agent and full power of substitution and
in the name of the Second Lien Secured Parties or otherwise, to execute and
deliver any document or instrument that the First Lien Agent is required or
permitted to deliver pursuant to this Section 6.10, such appointment being
coupled with an interest and irrevocable.
6.11 Asset Dispositions in an Insolvency Proceeding. Neither the
Second Lien Agent nor any other Second Lien Secured Party shall, in an
Insolvency or Liquidation Proceeding or in connection with an Exercise of
Remedies (subject to the condition set forth in the proviso of Section 5.1(a)
hereof), oppose any sale or disposition of any assets of any Loan Party that is
supported by the First Lien Secured Parties, and the Second Lien Agent and each
other Second Lien Secured Party will be deemed to have consented under Section
363 of the Bankruptcy Code (and otherwise) to any sale supported by the First
Lien Secured Parties and to have released their Liens on such assets, in each
case so long as the respective interests of the Second Lien Secured Parties
attach to the proceeds thereof subject to the relative priorities described in
Section 2 hereof.
6.12 Other Matters. To the extent that the Second Lien Agent or any
Second Lien Secured Party has or acquires rights under Section 363 or Section
364 of the Bankruptcy Code with respect to any of the Collateral, the Second
Lien Agent agrees, on behalf of itself and the other Second Lien Secured Parties
not to assert any of such rights without the prior written consent of the First
Lien Agent; provided that if requested by the First Lien Agent, the Second Lien
Agent shall timely exercise such rights in the manner requested by the First
Lien Agent, including any rights to payments in respect of such rights.
SECTION 7. RELIANCE; WAIVERS; ETC.
7.1 Reliance. Other than any reliance on the terms of this
Agreement, the First Lien Agent, on behalf of itself and the First Lien Secured
Parties, acknowledges that it and such First Lien Secured Parties have,
independently and without reliance on the Second Lien Agent or any Second Lien
Secured Party, and based on documents and information deemed by them
appropriate, made their own credit analyses and decisions to enter into such
First Lien Loan Documents and be bound by the terms of this Agreement and they
will continue to make their own credit decision in taking or not taking any
action under the First Lien Credit Agreement or this Agreement. The Second Lien
Agent, on behalf of itself and the Second Lien Secured Parties, acknowledges
that it and the Second Lien Secured Parties have, independently and without
reliance on the First Lien Agent or any First Lien Secured Party, and based on
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documents and information deemed by them appropriate, made their own credit
analysis and decision to enter into each of the Second Lien Loan Documents and
be bound by the terms of this Agreement and they will continue to make their own
credit decision in taking or not taking any action under the Second Lien Loan
Documents or this Agreement.
7.2 No Warranties or Liability. The First Lien Agent, on behalf of
itself and the First Lien Secured Parties, acknowledges and agrees that each of
the Second Lien Agent and the Second Lien Secured Parties have made no express
or implied representation or warranty, including with respect to the execution,
validity, legality, completeness, collectibility or enforceability of any of the
Second Lien Loan Documents, the ownership of any Collateral or the perfection or
priority of any Liens thereon. The Second Lien Secured Parties will be entitled
to manage and supervise their respective loans and extensions of credit under
the Second Lien Loan Documents in accordance with law and as they may otherwise,
in their sole discretion, deem appropriate. The Second Lien Agent, on behalf of
itself and the Second Lien Secured Parties, acknowledges and agrees that the
First Lien Agent and the First Lien Secured Parties have made no express or
implied representation or warranty, including with respect to the execution,
validity, legality, completeness, collectibility or enforceability of any of the
First Lien Loan Documents, the ownership of any Collateral or the perfection or
priority of any Liens thereon. The First Lien Secured Parties will be entitled
to manage and supervise their respective loans and extensions of credit under
their respective First Lien Loan Documents in accordance with law and as they
may otherwise, in their sole discretion, deem appropriate. The Second Lien Agent
and the Second Lien Secured Parties shall have no duty to the First Lien Agent
or any of the First Lien Secured Parties, and the First Lien Agent and the First
Lien Secured Parties shall have no duty to the Second Lien Agent or any of the
Second Lien Secured Parties, to act or refrain from acting in a manner which
allows, or results in, the occurrence or continuance of an event of default or
default under any agreements with the Borrower or any Guarantor Subsidiary
(including the First Lien Loan Documents and the Second Lien Loan Documents),
regardless of any knowledge thereof which they may have or be charged with.
7.3 No Waiver of Lien Priorities.
(a) No right of any First Lien Secured Party or the First Lien Agent
to enforce any provision of this Agreement or any First Lien Loan Document shall
at any time in any way be prejudiced or impaired by any act or failure to act on
the part of the Borrower or any other Loan Party or by any act or failure to act
by any First Lien Secured Party or the First Lien Agent, or by any noncompliance
by any Person with the terms, provisions and covenants of this Agreement, any of
the First Lien Loan Documents or any of the Second Lien Loan Documents,
regardless of any knowledge thereof which the First Lien Agent or any First Lien
Secured Parties may have or be otherwise charged with.
(b) Without in any way limiting the generality of the foregoing
paragraph (but subject to the rights of the Borrower and the other Loan Parties
under the First Lien Loan Documents and subject to the provisions of Section
5.3(a) hereof), the First Lien Secured Parties, the First Lien Agent and any of
them may, at any time and from time to time in accordance with the First Lien
Loan Documents and/or applicable law, without the consent of, or notice to, the
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Second Lien Agent or any Second Lien Secured Party, without incurring any
liabilities to the Second Lien Agent or any Second Lien Secured Party and
without impairing or releasing the Lien priorities and other benefits provided
in this Agreement (even if any right of subrogation or other right or remedy of
the Second Lien Agent or any Second Lien Secured Party is affected, impaired or
extinguished thereby) do any one or more of the following:
(i) change the manner, place or terms of payment or change or extend
the time of payment of, or amend, renew, exchange, increase or alter, the
terms of any of the First Lien Obligations or any Lien on any First Lien
Collateral or guaranty thereof or any liability of the Borrower or any
other Loan Party, or any liability incurred directly or indirectly in
respect thereof (including any increase in or extension of the First Lien
Obligations, without any restriction as to the amount (subject to Section
5.3(a) hereof), tenor or terms of any such increase or extension) or
otherwise amend, renew, exchange, extend, modify or supplement in any
manner any Liens held by the First Lien Agent or any of the First Lien
Secured Parties, the First Lien Obligations or any of the First Lien Loan
Documents;
(ii) sell, exchange, release, surrender, realize upon, enforce or
otherwise deal with in any manner and in any order any part of the First
Lien Collateral or any liability of the Borrower or any other Loan Party
to the First Lien Secured Parties or the First Lien Agent, or any
liability incurred directly or indirectly in respect thereof;
(iii) settle or compromise any First Lien Obligation or any other
liability of the Borrower or any other Loan Party or any security therefor
or any liability incurred directly or indirectly in respect thereof and
apply any sums by whomsoever paid and however realized to any liability
(including the First Lien Obligations) in any manner or order; and
(iv) exercise or delay in or refrain from exercising any right or
remedy against the Borrower or any security or any other Loan Party or any
other Person, and elect any remedy and otherwise deal freely with the
Borrower, any other Loan Party or any First Lien Collateral and any
security and any guarantor or any liability of the Borrower or any other
Loan Party to the First Lien Secured Parties or any liability incurred
directly or indirectly in respect thereof.
(c) The Second Lien Agent, on behalf of itself and the Second Lien
Secured Parties, also agrees that the First Lien Secured Parties and the First
Lien Agent shall have no liability to the Second Lien Agent or any Second Lien
Secured Party, and the Second Lien Agent, on behalf of itself and the Second
Lien Secured Parties, hereby waives any claim against any First Lien Secured
Party or the First Lien Agent, arising out of any and all actions which the
First Lien Secured Parties or the First Lien Agent may take or permit or omit to
take with respect to: (i) the First Lien Loan Documents, (ii) the collection of
the First Lien Obligations or (iii) the foreclosure upon, or sale, liquidation
or other disposition of, any First Lien Collateral. The Second Lien Agent, on
behalf of itself and the Second Lien Secured Parties, agrees that the First Lien
Secured Parties and the First Lien Agent have no duty to them in respect of the
maintenance or preservation of the First Lien Collateral, the First Lien
Obligations or otherwise.
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(d) The Second Lien Agent, on behalf of itself and the Second Lien
Secured Parties, agrees not to assert and hereby waives, to the fullest extent
permitted by law, any right to demand, request, plead or otherwise assert or
otherwise claim the benefit of, any marshalling, appraisal, valuation or other
similar right that may otherwise be available under applicable law with respect
to the Collateral or any other similar rights a junior secured creditor may have
under applicable law (it being understood that this Section 7.3(d) shall not
prohibit exercise of rights the Second Lien Secured Parties may have under the
Second Lien Loan Documents to require delivery of appraisals or similar
information by the Borrower outside the context of an Insolvency or Liquidation
Proceeding or and Exercise of Remedies).
7.4 Obligations Unconditional. All rights, interests, agreements and
obligations of the First Lien Agent and the First Lien Secured Parties and the
Second Lien Agent and the Second Lien Secured Parties, respectively, hereunder
shall remain in full force and effect irrespective of:
(a) any lack of validity or enforceability of any First Lien Loan
Documents or any Second Lien Loan Documents or the perfection of any liens
thereunder;
(b) except as otherwise set forth in the Agreement, any change in
the time, manner or place of payment of, or in any other terms of, all or
any of the First Lien Obligations or Second Lien Obligations, or any
amendment or waiver or other modification, including any increase in the
amount thereof, whether by course of conduct or otherwise, of the terms of
any First Lien Loan Document or any Second Lien Loan Document;
(c) any exchange of any security interest in any Collateral or any
other collateral, or any amendment, waiver or other modification, whether
in writing or by course of conduct or otherwise, of all or any of the
First Lien Obligations or Second Lien Obligations or any guarantee
thereof;
(d) the commencement of any Insolvency or Liquidation Proceeding in
respect of the Borrower or any other Loan Party; or
(e) any other circumstances which otherwise might constitute a
defense available to, or a discharge of, the Borrower or any other Loan
Party in respect of the First Lien Obligations, or of the Second Lien
Agent or any Second Lien Secured Party in respect of this Agreement.
7.5 Certain Notices.
(a) Promptly upon (or as soon as practicable following) the
satisfaction of the conditions set forth in the definition of Discharge of
First Lien Obligations, the First Lien Agent shall deliver written notice
confirming the same to the Second Lien Agent; provided that the failure to
give any such notice shall not result in any liability of the First Lien
Agent or the First Lien Secured Parties hereunder or in the modification,
alteration, impairment, or waiver of the rights of any party hereunder.
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(b) Promptly upon the commencement by the First Lien Agent of any
enforcement action or the exercise of any remedy with respect to any
Collateral (including by way of a public or private sale of Collateral),
the First Lien Agent shall notify the Second Lien Agent of such action;
provided that the failure to give any such notice shall not result in any
liability of the First Lien Agent or the First Lien Secured Parties
hereunder or in the modification, alteration, impairment, or waiver of the
rights of any party hereunder.
SECTION 8. MISCELLANEOUS.
8.1 Conflicts. In the event of any conflict between the provisions
of this Agreement and the provisions of the First Lien Loan Documents or the
Second Lien Loan Documents, the provisions of this Agreement shall govern and
control.
8.2 Effectiveness; Continuing Nature of this Agreement;
Severability; Termination. This Agreement shall become effective when executed
and delivered by the parties hereto. This is a continuing agreement of lien
subordination and the First Lien Secured Parties may continue, at any time and
without notice to the Second Lien Agent or any Second Lien Secured Party, to
extend credit and other financial accommodations and lend monies to or for the
benefit of the Borrower or any Loan Party constituting First Lien Obligations in
reliance hereon. The Second Lien Agent, on behalf of itself and the Second Lien
Secured Parties, hereby waives any right it may have under applicable law to
revoke this Agreement or any of the provisions of this Agreement. The terms of
this Agreement shall survive, and shall continue in full force and effect, in
any Insolvency or Liquidation Proceeding. Any provision of this Agreement which
is prohibited or unenforceable in any jurisdiction shall not invalidate the
remaining provisions hereof, and any such prohibition or unenforceability in any
jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction. All references to the Borrower or any other Loan Party shall
include the Borrower or such Loan Party as debtor and debtor-in-possession and
any receiver or trustee for the Borrower or any other Loan Party (as the case
may be) in any Insolvency or Liquidation Proceeding. This Agreement shall
terminate and be of no further force and effect, (i) with respect to the Second
Lien Agent, the Second Lien Secured Parties and the Second Lien Obligations,
upon the later of (1) the date upon which the obligations under the Second Lien
Credit Agreement terminate if there are no other Second Lien Obligations
outstanding on such date and (2) if there are other Second Lien Obligations
outstanding on such date, the date upon which such Second Lien Obligations
terminate and (ii) subject to Section 5.6, with respect to the First Lien Agent,
the First Lien Secured Parties and the First Lien Obligations, the date of
Discharge of First Lien Obligations, subject to the rights of the First Lien
Secured Parties under Section 6.5.
8.3 Amendments; Waivers. No amendment, modification or waiver of any
of the provisions of this Agreement by the Second Lien Agent or the First Lien
Agent shall be deemed to be made unless the same shall be in writing signed on
behalf of each of the First Lien Agent (acting pursuant to the consent of the
Required Lenders, as such term is defined in the First Lien Credit Agreement)
and the Second Lien Agent (acting pursuant to the consent of the Required
Lenders, as such term is defined in the Second Lien Credit Agreement) or its
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authorized agent and each waiver, if any, shall be a waiver only with respect to
the specific instance involved and shall in no way impair the rights of the
parties making such waiver or the obligations of the other parties to such party
in any other respect or at any other time.
8.4 Information Concerning Financial Condition of Holdings, Borrower
and their Subsidiaries. The First Lien Agent and the First Lien Secured Parties,
on the one hand, and the Second Lien Agent and the Second Lien Secured Parties,
on the other hand, shall each be responsible for keeping themselves informed of
(a) the financial condition of Holdings, Borrower and their Subsidiaries and all
endorsers and/or guarantors of the First Lien Obligations or the Second Lien
Obligations and (b) all other circumstances bearing upon the risk of nonpayment
of the First Lien Obligations or the Second Lien Obligations. The First Lien
Agent and the First Lien Secured Parties shall have no duty to advise the Second
Lien Agent or any Second Lien Secured Party of information known to it or them
regarding such condition or any such circumstances or otherwise. In the event
the First Lien Agent or any of the First Lien Secured Parties, in its or their
sole discretion, undertakes at any time or from time to time to provide any such
information to the Second Lien Agent or any Second Lien Secured Parties, it or
they shall be under no obligation (w) to make, and the First Lien Agent and the
First Lien Secured Parties shall not make, any express or implied representation
or warranty, including with respect to the accuracy, completeness, truthfulness
or validity of any such information so provided, (x) to provide any additional
information or to provide any such information on any subsequent occasion, (y)
to undertake any investigation or (z) to disclose any information which,
pursuant to accepted or reasonable commercial finance practices, such party
wishes to maintain confidential or is otherwise required to maintain
confidential.
8.5 Subrogation. The Second Lien Agent, on behalf of itself and the
Second Lien Secured Parties, hereby waives any rights of subrogation it may
acquire as a result of any payment hereunder until the Discharge of First Lien
Obligations has occurred.
8.6 Application of Payments. All payments received by the First Lien
Agent or the First Lien Secured Parties may be applied, reversed and reapplied,
in whole or in part, to such part of the First Lien Obligations provided for in
the First Lien Loan Documents. The Second Lien Agent, on behalf of itself and
the Second Lien Secured Parties, assents to any extension or postponement of the
time of payment of the First Lien Obligations or any part thereof and to any
other indulgence with respect thereto, to any substitution, exchange or release
of any security which may at any time secure any part of the First Lien
Obligations and to the addition or release of any other Person primarily or
secondarily liable therefor.
8.7 SUBMISSION TO JURISDICTION; WAIVERS.
(a) ALL JUDICIAL PROCEEDINGS BROUGHT AGAINST ANY PARTY ARISING OUT
OF OR RELATING HERETO MAY BE BROUGHT IN ANY STATE OR FEDERAL COURT OF COMPETENT
JURISDICTION IN XXX XXXXX, XXXXXX XXX XXXX XX XXX XXXX. BY EXECUTING AND
DELIVERING THIS AGREEMENT, EACH PARTY, FOR ITSELF AND ON BEHALF OF THE
RESPECTIVE SECURED PARTIES IT REPRESENTS, IRREVOCABLY (A) ACCEPTS GENERALLY AND
UNCONDITIONALLY THE NONEXCLUSIVE JURISDICTION
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AND VENUE OF SUCH COURTS; (B) WAIVES ANY DEFENSE OF FORUM NON CONVENIENS; (C)
AGREES THAT SERVICE OF ALL PROCESS IN ANY SUCH PROCEEDING IN ANY SUCH COURT MAY
BE MADE BY REGISTERED OR CERTIFIED MAIL, RETURN RECEIPT REQUESTED, TO THE
APPLICABLE PARTY AT ITS ADDRESS PROVIDED IN ACCORDANCE WITH SECTION 8.8 HEREOF;
AND (D) AGREES THAT SERVICE AS PROVIDED IN CLAUSE (C) ABOVE IS SUFFICIENT TO
CONFER PERSONAL JURISDICTION OVER THE APPLICABLE PARTY IN ANY SUCH PROCEEDING IN
ANY SUCH COURT, AND OTHERWISE CONSTITUTES EFFECTIVE AND BINDING SERVICE IN EVERY
RESPECT.
(b) EACH OF THE PARTIES HERETO, ON BEHALF OF THE RESPECTIVE SECURED
PARTIES IT REPRESENTS, HEREBY AGREES TO WAIVE ITS RESPECTIVE RIGHTS TO A JURY
TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING HEREUNDER. THE SCOPE
OF THIS WAIVER IS INTENDED TO BE ALL-ENCOMPASSING OF ANY AND ALL DISPUTES THAT
MAY BE FILED IN ANY COURT AND THAT RELATE TO THE SUBJECT MATTER HEREOF,
INCLUDING CONTRACT CLAIMS, TORT CLAIMS, BREACH OF DUTY CLAIMS AND ALL OTHER
COMMON LAW AND STATUTORY CLAIMS. EACH PARTY HERETO, ON BEHALF OF THE RESPECTIVE
SECURED PARTIES IT REPRESENTS, ACKNOWLEDGES THAT THIS WAIVER IS A MATERIAL
INDUCEMENT TO ENTER INTO A BUSINESS RELATIONSHIP, THAT EACH HAS ALREADY RELIED
ON THIS WAIVER IN ENTERING INTO THIS AGREEMENT, AND THAT EACH WILL CONTINUE TO
RELY ON THIS WAIVER IN ITS RELATED FUTURE DEALINGS. EACH PARTY HERETO, ON BEHALF
OF THE RESPECTIVE SECURED PARTIES IT REPRESENTS, FURTHER WARRANTS AND REPRESENTS
THAT IT HAS REVIEWED THIS WAIVER WITH ITS LEGAL COUNSEL AND THAT IT KNOWINGLY
AND VOLUNTARILY WAIVES ITS JURY TRIAL RIGHTS FOLLOWING CONSULTATION WITH LEGAL
COUNSEL. THIS WAIVER IS IRREVOCABLE, MEANING THAT IT MAY NOT BE MODIFIED EITHER
ORALLY OR IN WRITING (OTHER THAN BY A MUTUAL WRITTEN WAIVER SPECIFICALLY
REFERRING TO THIS SECTION 8.7(B) AND EXECUTED BY EACH OF THE PARTIES HERETO),
AND THIS WAIVER SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS, RENEWALS, SUPPLEMENTS
OR MODIFICATIONS HERETO. IN THE EVENT OF LITIGATION, THIS AGREEMENT MAY BE FILED
AS A WRITTEN CONSENT TO A TRIAL BY THE COURT.
8.8 Notices. All notices to the Second Lien Secured Parties and the
First Lien Secured Parties permitted or required under this Agreement shall also
be sent to the Second Lien Agent and the First Lien Agent, respectively. Unless
otherwise specifically provided herein, any notice or other communication herein
required or permitted to be given shall be in writing and may be personally
served, faxed, electronically mailed or sent by courier service or U.S. mail and
shall be deemed to have been given when delivered in person or by courier
service and upon receipt of electronic mail, facsimile or U.S. mail (registered
or certified, with postage prepaid and properly addressed). For the purposes
hereof, the addresses of the parties hereto shall be as
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set forth below each party's name on the signature pages hereto, or, as to each
party, at such other address as may be designated by such party in a written
notice to all of the other parties.
8.9 Further Assurances. The First Lien Agent, on behalf of itself
and the First Lien Secured Parties, and the Second Lien Agent, on behalf of
itself and the Second Lien Secured Parties, agrees that each of them shall take
such further action and shall execute and deliver such additional documents and
instruments (in recordable form, if requested) as the First Lien Agent or the
Second Lien Agent may reasonably request to effectuate the terms of and the lien
priorities contemplated by this Agreement.
8.10 APPLICABLE LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND SHALL
BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK,
WITHOUT REGARD TO CONFLICTS OF LAW PRINCIPLES THAT WOULD REQUIRE THE APPLICATION
OF THE LAWS OF ANOTHER JURISDICTION.
8.11 Binding on Successors and Assigns. This Agreement shall be
binding upon the First Lien Agent, the First Lien Secured Parties, the Second
Lien Agent, the Second Lien Secured Parties and their respective successors and
assigns. If either of the First Lien Agent or the Second Lien Agent resigns or
is replaced pursuant to the First Lien Credit Agreement or the Second Lien
Credit Agreement, as applicable, its successor shall be deemed to be a party to
this Agreement and shall have all of the rights of and be subject to all of the
obligations of this Agreement.
8.12 Specific Performance. Each of the First Lien Agent and the
Second Lien Agent may demand specific performance of this Agreement. The First
Lien Agent, on behalf of itself and the First Lien Secured Parties, and the
Second Lien Agent, on behalf of itself and the Second Lien Secured Parties,
hereby irrevocably waives any defense based on the adequacy of a remedy at law
and any other defense which might be asserted to bar the remedy of specific
performance in any action which may be brought by any First Lien Agent or the
Second Lien Agent, as the case may be.
8.13 Headings. Section headings in this Agreement are included
herein for convenience of reference only and shall not constitute a part of this
Agreement for any other purpose or be given any substantive effect.
8.14 Counterparts. This Agreement may be executed in counterparts
(and by different parties hereto in different counterparts), each of which shall
constitute an original, but all of which when taken together shall constitute a
single contract. Delivery of an executed counterpart of a signature page of this
Agreement or any document or instrument delivered in connection herewith by
facsimile shall be effective as delivery of a manually executed counterpart of
this Agreement or such other document or instrument, as applicable.
8.15 Authorization. By its signature, each Person executing this
Agreement on behalf of a party hereto represents and warrants to the other
parties hereto that it is duly authorized to execute this Agreement.
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8.16 No Third Party Beneficiaries. This Agreement and the rights and
benefits hereof shall inure to the benefit of each of the parties hereto and
their respective successors and assigns and shall inure to the benefit of each
of the First Lien Secured Parties and the Second Lien Secured Parties. No other
Person shall have or be entitled to assert rights or benefits hereunder.
8.17 Provisions Solely to Define Relative Rights. The provisions of
this Agreement are and are intended solely for the purpose of defining the
relative rights of the First Lien Secured Parties on the one hand and the Second
Lien Secured Parties on the other hand. None of the Borrower, any other Loan
Party or any other creditor thereof shall have any rights hereunder. Nothing in
this Agreement is intended to or shall impair the obligations of the Borrower or
any other Loan Party, which are absolute and unconditional, to pay the First
Lien Obligations and the Second Lien Obligations as and when the same shall
become due and payable in accordance with their terms.
[SIGNATURE PAGES FOLLOW]
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IN WITNESS WHEREOF, the parties hereto have executed this
Intercreditor Agreement as of the date first written above.
GENERAL ELECTRIC CAPITAL
CORPORATION, as First Lien Agent
By: _____________________________
Name: Xxxxxx Xxxxx
Title: Vice President
Address:
0 Xxxxxxxx Xxxxx Xxxxxx, Xxxxx 000
Xxxxxxxx, Xxxxxxxx 00000
Attention:
Inverness Account Manager
Facsimile Number:
(000) 000-0000
E-mail address:
xxxx.xxxxxx@xx.xxx
GENERAL ELECTRIC CAPITAL
CORPORATION, as Second Lien Agent
By: _______________________________
Name: Xxxxxx Xxxxx
Title: Vice President
Address:
0 Xxxxxxxx Xxxxx Xxxxxx, Xxxxx 000
Xxxxxxxx, Xxxxxxxx 00000
Attention:
Inverness Account Manager
Facsimile Number:
(000) 000-0000
E-mail address:
xxxx.xxxxxx@xx.xxx
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ACKNOWLEDGED AND AGREED
as of the day and year first above written
IM US HOLDINGS, LLC
By: _______________________________
Name:
Title:
INVERNESS MEDICAL INNOVATIONS, INC.
By: _______________________________
Name:
Title:
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