MCKESSON CORPORATION
Xxx Xxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxxxxxxx, XX 00000
April 30, 1998
Xx. Xxxx Xxxxxxx
Horizon Pharmacies, Inc.
000 X. Xxxxxxxxx Xxxxx
Xxxxxxxxx, XX 00000
RE: LOAN FACILITIES
Dear Xxxx:
Pursuant to our recent discussion, McKesson Corporation ("McKesson")
is pleased to offer to Horizon Pharmacies, Inc. ("Horizon") the various loan
facilities described in Exhibit A attached hereto (the "Facilities") upon the
terms and subject to the conditions set forth herein and therein. Exhibit A
is hereby incorporated herein, and all references to this letter shall be
deemed to include Exhibit A hereto.
In submitting this letter, McKesson is relying on Horizon's
assurances that Horizon has obtained any necessary consent of its current
lenders and/or suppliers to negotiate and entertain the terms of this letter.
Horizon's execution and acceptance of this letter will constitute a
representation by Horizon that it has obtained all necessary consents from
its current lenders and/or suppliers to accept the terms of this letter.
This letter is not meant to encompass all of the terms and
conditions of the Facilities. This letter is intended to outline the
principal points of business understandings concerning the Facilities.
McKesson's commitment hereunder is subject to (a) the execution of a
definitive credit agreement (the "Credit Agreement") and other documentation,
including financial and other covenant definitions, all in form and substance
satisfactory to the McKesson, and (b) no material adverse change in the
operations, business, financial condition, properties or prospects of Horizon
or its subsidiaries having occurred since December 31, 1997.
In consideration of the commitment provided hereunder, Horizon
agrees to indemnify and hold harmless McKesson and its affiliates and
officers, directors, employees, agents, attorneys and advisors for all
claims, damages, liabilities and expenses (including, without limitation,
reasonable fees and disbursements of counsel) incurred by any of them in
connection with this letter, the Facilities, the use by Horizon of the
Facilities or the
Xx. Xxxx Xxxxxxx April 30, 1998
Page 2
proceeds thereof, the credit documents or any related documents, instruments
or agreements or any transaction contemplated hereby or thereby, whether or
not such transactions are consummated, except to the extent such claims,
damages, losses, liabilities and expenses are caused by such party's gross
negligence or willful misconduct.
The commitment set forth herein with respect to the Facilities is
personal to Horizon and may not be transferred or assigned to any other party
without the prior written consent of McKesson. Neither this letter nor any
part hereof may, without our prior written consent, be disclosed or exhibited
to any other party, unless required by law, except to Horizon's accountants,
attorneys and other advisors, and then, in each case, only on a confidential
basis.
If the commitment offered herein is satisfactory, please indicate
Horizon's acceptance by signing and dating the enclosed copy of this letter
and returning it to the undersigned. Unless so accepted or otherwise
terminated by Horizon on or prior to May 5, 1998, the offer set forth herein
will expire on that date.
Upon Horizon's acceptance of the commitment offer set forth herein,
McKesson will commence its due diligence and instruct counsel to commence
documentation. By accepting this offer, Horizon agrees to reimburse McKesson
for all costs and expenses (including, without limitation, fees and
disbursement of counsel for McKesson but subject to any cap on legal fees set
forth in Exhibit A) incurred by McKesson in connection with due diligence for
the Facilities and the negotiation, preparation, execution, delivery and
enforcement of the credit documents, whether or not any loan is made under
the Facilities, any of the transactions contemplated hereby are consummated
or any credit documents are executed and delivered.
If Horizon accepts this offer, the commitment hereunder shall
continue until July 15, 1998, on which date McKesson's commitment shall
expire unless final credit documents have been executed by the parties
thereto on or prior to such date.
We look forward to working with you on this transaction. Please
let us know if you have any questions.
Very truly yours,
McKESSON CORPORATION
By: Xxxx Xxxxxx
------------------------------------
Title: Senior Vice President
Financial Services
Xx. Xxxx Xxxxxxx April 30, 1998
Page 3
ACCEPTED:
HORIZON PHARMACIES, INC.
By: Xxxx Xxxxxxx
-----------------------------
Title: CFO
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4-30-98
