UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
______________________
FORM 8K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported)
February 27, 2018
______________________
ALIGN TECHNOLOGY, INC.
(Exact name of registrant as specified in its charter)
Delaware | 0-32259 | 94-3267295 | ||
(State or other jurisdiction of incorporation) | (Commission File Number) | (IRS Employer Identification No.) | ||
2820 Orchard Parkway
San Jose, California 95134
(Address of principal executive offices, including zip code)
(408) 470-1000
(Registrant’s telephone number, including area code)
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
[ ] Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
[ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
[ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter)
Emerging growth company [ ]
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. [ ]
Item 1.01 Entry into a Material Definitive Agreement.
On February 27, 2018, Align Technology, Inc. (the “Company”) entered into a Credit Agreement, between the Company and Wells Fargo Bank, National Association (the “Credit Agreement”). The Credit Agreement provides for a $200.0 million secured revolving credit facility with a $50.0 million letter of credit. The commitments under the Credit Agreement expire on February 27, 2021 (the “Maturity Date”). The Company’s obligations under the Credit Agreement are guaranteed by certain of its subsidiaries meeting materiality thresholds set forth in the Credit Agreement.
The proceeds of the loans under the Credit Agreement may be used for working capital and general corporate purposes. The Company has the right to prepay loans under the Credit Agreement in whole or in part at any time without penalty. Amounts prepaid may be reborrowed. As of the closing date of the Credit Agreement, no loans or letters of credit were outstanding under the Credit Agreement.
Loans under the Credit Agreement bear interest, at the Company’s option, at either a rate based on the reserve adjusted London Interbank Offered Rate (“LIBOR”) for the applicable interest period or a base rate, in each case plus a margin. The base rate is the highest of Wells Fargo’s publicly announced prime rate, the federal funds rate plus 0.50% and one month LIBOR plus 1.0%. The margin ranges from 1.25% to 1.75% for LIBOR loans and 0.25% to 0.75% for base rate loans. Interest on the loans is payable quarterly in arrears with respect to base rate loans and at the end of an interest period (and at three month intervals if the interest period exceeds three months) in the case of LIBOR loans. Principal, together with accrued and unpaid interest, is due on the Maturity Date.
The Credit Agreement requires the Company to comply with a maximum consolidated leverage ratio of 3.00 to 1.00 and a minimum consolidated interest coverage ratio of 3.00 to 1.00, measured in each case at the end of each fiscal quarter of the Company.
The Credit Agreement contains customary affirmative covenants, including covenants regarding the payment of taxes and other obligations, maintenance of insurance, reporting requirements and compliance with applicable laws and regulations. Further, the Credit Agreement contains customary negative covenants limiting the ability of the Company and its subsidiaries, among other things, to incur debt, grant liens, make investments, make certain restricted payments and sell assets, subject to certain exceptions. Upon the occurrence and during the continuance of an event of default, the lenders may declare all outstanding principal and accrued and unpaid interest under the Credit Agreement immediately due and payable and may exercise the other rights and remedies provided for under the Credit Agreement and related loan documents. The events of default under the Credit Agreement include, subject to grace periods in certain instances, payment defaults, cross defaults with certain other indebtedness, breaches of covenants or representations and warranties, change in control of the Company and certain bankruptcy and insolvency events with respect to the Company and its subsidiaries meeting a materiality threshold set forth in the Credit Agreement.
The description of the Credit Agreement contained herein is qualified in its entirety by reference to the text of the Credit Agreement, which is attached as an Exhibit hereto.
Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant.
The information set forth in Item 1.01 hereof is incorporated by reference into this Item 2.03.
Item 9.01 Financial Statements and Exhibits
(d) Exhibits.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
Dated: | February 27, 2018 | ALIGN TECHNOLOGY, INC. |
By: /s/ Roger E. George | ||
Roger E. George | ||
Vice President, Legal and Corporate Affairs and General Counsel | ||
Execution Version
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$200,000,000
CREDIT AGREEMENT
dated as of February 27, 2018,
by and between
ALIGN TECHNOLOGY, INC.,
as the Borrower,
and
WELLS FARGO BANK, NATIONAL ASSOCIATION,
as the Lender,
TABLE OF CONTENTS
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ARTICLE I DEFINITIONS ........................................................................................................................ 1
SECTION 1.1 Definitions ................................................................................................................ 1
SECTION 1.2 Other Definitions and Provisions ........................................................................... 25
SECTION 1.3 Accounting Terms. ................................................................................................. 25
SECTION 1.4 UCC Terms ............................................................................................................ 26
SECTION 1.5 Rounding ................................................................................................................ 26
SECTION 1.6 References to Agreement and Laws ....................................................................... 26
SECTION 1.7 Times of Day .......................................................................................................... 26
SECTION 1.8 Letter of Credit Amounts ....................................................................................... 27
SECTION 1.9 Guarantees/Earn-Outs ............................................................................................ 27
SECTION 1.10 Covenant Compliance Generally ........................................................................... 27
SECTION 1.11 Rates ....................................................................................................................... 27
ARTICLE II REVOLVING CREDIT FACILITY .................................................................................... 27
SECTION 2.1 Revolving Credit Loans ......................................................................................... 27
SECTION 2.2 [Reserved]. ............................................................................................................. 27
SECTION 2.3 Procedure for Advances of Revolving Credit Loans. ............................................ 27
SECTION 2.4 Repayment and Prepayment of Revolving Credit Loans. ...................................... 28
SECTION 2.5 Permanent Reduction of the Revolving Credit Commitment. ............................... 29
SECTION 2.6 Termination of Revolving Credit Facility .............................................................. 29
SECTION 2.7 Extension of Revolving Credit Maturity Date. ...................................................... 29
ARTICLE III LETTER OF CREDIT FACILITY ..................................................................................... 30
SECTION 3.1 Letter of Credit Facility. ......................................................................................... 30
SECTION 3.2 Procedure for Issuance of Letters of Credit ........................................................... 31
SECTION 3.3 Commissions and Other Charges. .......................................................................... 31
SECTION 3.4 [Reserved]. ............................................................................................................. 31
SECTION 3.5 Reimbursement Obligation of the Borrower .......................................................... 31
SECTION 3.6 Obligations Absolute .............................................................................................. 32
SECTION 3.7 Effect of Letter of Credit Application .................................................................... 32
SECTION 3.8 [Reserved]. ............................................................................................................. 32
SECTION 3.9 [Reserved]. ............................................................................................................. 32
SECTION 3.10 Letters of Credit Issued for Subsidiaries ................................................................ 32
SECTION 3.11 Cash Collateral for Extended Letters of Credit. ..................................................... 33
ARTICLE IV [RESERVED] ..................................................................................................................... 34
ARTICLE V GENERAL LOAN PROVISIONS ....................................................................................... 34
SECTION 5.1 Interest. ................................................................................................................... 34
SECTION 5.2 Notice and Manner of Conversion or Continuation of Loans ................................ 35
SECTION 5.3 Fees ........................................................................................................................ 36
SECTION 5.4 Manner of Payment ................................................................................................ 36
SECTION 5.5 Evidence of Indebtedness. ...................................................................................... 36
SECTION 5.6 [Reserved]. ............................................................................................................. 37
SECTION 5.7 [Reserved]. ............................................................................................................. 37
SECTION 5.8 Changed Circumstances. ........................................................................................ 37
SECTION 5.9 Indemnity ............................................................................................................... 38
SECTION 5.10 Increased Costs. ..................................................................................................... 38
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SECTION 5.11 Taxes. ..................................................................................................................... 39
ARTICLE VI CONDITIONS OF CLOSING AND BORROWING ........................................................ 41
SECTION 6.1 Conditions to Closing and Initial Extensions of Credit .......................................... 41
SECTION 6.2 Conditions to All Extensions of Credit .................................................................. 43
ARTICLE VII REPRESENTATIONS AND WARRANTIES OF THE CREDIT PARTIES .................. 44
SECTION 7.1 Organization; Power; Qualification ....................................................................... 44
SECTION 7.2 Ownership .............................................................................................................. 44
SECTION 7.3 Authorization; Enforceability................................................................................. 44
SECTION 7.4 Compliance of Agreement, Loan Documents and Borrowing with Laws,
Etc. ........................................................................................................................ 45
SECTION 7.5 Compliance with Law; Governmental Approvals .................................................. 45
SECTION 7.6 Tax Returns and Payments ..................................................................................... 45
SECTION 7.7 Intellectual Property Matters .................................................................................. 46
SECTION 7.8 Environmental Matters. .......................................................................................... 46
SECTION 7.9 Employee Benefit Matters. .................................................................................... 47
SECTION 7.10 Margin Stock .......................................................................................................... 48
SECTION 7.11 Government Regulation ......................................................................................... 48
SECTION 7.12 [Reserved]. ............................................................................................................. 48
SECTION 7.13 Employee Relations ............................................................................................... 48
SECTION 7.14 Burdensome Provisions .......................................................................................... 48
SECTION 7.15 Financial Statements .............................................................................................. 48
SECTION 7.16 No Material Adverse Change ................................................................................. 49
SECTION 7.17 Solvency ................................................................................................................. 49
SECTION 7.18 Title to Properties ................................................................................................... 49
SECTION 7.19 Litigation ................................................................................................................ 49
SECTION 7.20 Anti-Corruption Laws; Anti-Money Laundering Laws and Sanctions. ................. 49
SECTION 7.21 Absence of Defaults ............................................................................................... 50
SECTION 7.22 [Reserved] .............................................................................................................. 50
SECTION 7.23 Disclosure............................................................................................................... 50
SECTION 7.24 Regulatory Matters ................................................................................................. 50
SECTION 7.25 Health Care Matters. .............................................................................................. 52
ARTICLE VIII AFFIRMATIVE COVENANTS ...................................................................................... 54
SECTION 8.1 Financial Statements and Budgets ......................................................................... 54
SECTION 8.2 Certificates; Other Reports ..................................................................................... 55
SECTION 8.3 Notice of Litigation and Other Matters .................................................................. 56
SECTION 8.4 Preservation of Corporate Existence and Related Matters ..................................... 57
SECTION 8.5 Maintenance of Property and Licenses. ................................................................. 57
SECTION 8.6 Insurance ................................................................................................................ 57
SECTION 8.7 Accounting Methods and Financial Records ......................................................... 57
SECTION 8.8 Payment of Taxes and Other Obligations .............................................................. 57
SECTION 8.9 Compliance with Laws and Approvals .................................................................. 58
SECTION 8.10 Environmental Laws .............................................................................................. 58
SECTION 8.11 Compliance with ERISA ........................................................................................ 58
SECTION 8.12 [Reserved]. ............................................................................................................. 58
SECTION 8.13 Visits and Inspections ............................................................................................ 58
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SECTION 8.14 Additional Subsidiaries. ......................................................................................... 59
SECTION 8.15 [Reserved]. ............................................................................................................. 59
SECTION 8.16 Use of Proceeds. ..................................................................................................... 59
SECTION 8.17 Compliance with Health Care Laws. ..................................................................... 59
SECTION 8.18 Compliance with Anti-Corruption Laws; Anti-Money Laundering Laws
and Sanctions ........................................................................................................ 60
SECTION 8.19 Compliance with Public Health Laws .................................................................... 60
SECTION 8.20 Further Assurances ................................................................................................. 60
ARTICLE IX NEGATIVE COVENANTS ............................................................................................... 60
SECTION 9.1 Indebtedness ........................................................................................................... 60
SECTION 9.2 Liens ....................................................................................................................... 62
SECTION 9.3 Investments ............................................................................................................ 64
SECTION 9.4 Fundamental Changes ............................................................................................ 66
SECTION 9.5 Asset Dispositions .................................................................................................. 67
SECTION 9.6 Restricted Payments ............................................................................................... 68
SECTION 9.7 Transactions with Affiliates ................................................................................... 69
SECTION 9.8 Accounting Changes; Organizational Documents. ................................................ 70
SECTION 9.9 [Reserved]. ............................................................................................................. 70
SECTION 9.10 No Further Negative Pledges; Restrictive Agreements. ......................................... 70
SECTION 9.11 Nature of Business ................................................................................................. 72
SECTION 9.12 [Reserved] .............................................................................................................. 72
SECTION 9.13 [Reserved]. ............................................................................................................. 72
SECTION 9.14 [Reserved] .............................................................................................................. 72
SECTION 9.15 Financial Covenants. .............................................................................................. 72
ARTICLE X DEFAULT AND REMEDIES ............................................................................................. 72
SECTION 10.1 Events of Default ................................................................................................... 72
SECTION 10.2 Remedies ................................................................................................................ 74
SECTION 10.3 Rights and Remedies Cumulative; Non-Waiver; etc. ............................................ 75
SECTION 10.4 Crediting of Payments and Proceeds ...................................................................... 75
ARTICLE XI [RESERVED] ..................................................................................................................... 76
ARTICLE XII MISCELLANEOUS .......................................................................................................... 76
SECTION 12.1 Notices. .................................................................................................................. 76
SECTION 12.2 Amendments, Waivers and Consents ..................................................................... 77
SECTION 12.3 Expenses; Indemnity. ............................................................................................. 78
SECTION 12.4 Right of Setoff ........................................................................................................ 79
SECTION 12.5 Governing Law; Jurisdiction, Etc. ......................................................................... 79
SECTION 12.6 Waiver of Jury Trial. .............................................................................................. 80
SECTION 12.7 Reversal of Payments ............................................................................................. 81
SECTION 12.8 Injunctive Relief ..................................................................................................... 81
SECTION 12.9 Successors and Assigns; Participations. ................................................................. 81
SECTION 12.10 Treatment of Certain Information; Confidentiality ................................................ 81
SECTION 12.11 Performance of Duties ........................................................................................... 82
SECTION 12.12 All Powers Coupled with Interest .......................................................................... 82
SECTION 12.13 Survival. ................................................................................................................. 82
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SECTION 12.14 Titles and Captions ................................................................................................. 83
SECTION 12.15 Severability of Provisions ...................................................................................... 83
SECTION 12.16 Counterparts; Integration; Effectiveness. ............................................................... 83
SECTION 12.17 Term of Agreement ................................................................................................ 83
SECTION 12.18 USA PATRIOT Act; Anti-Money Laundering Laws ............................................ 83
SECTION 12.19 Independent Effect of Covenants ........................................................................... 83
SECTION 12.20 No Advisory or Fiduciary Responsibility. ............................................................. 84
SECTION 12.21 Inconsistencies with Other Documents .................................................................. 84
SECTION 12.22 Acknowledgement and Consent to Bail-In of EEA Financial Institutions ............ 84
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EXHIBITS
Exhibit A - Form of Revolving Credit Note
Exhibit B - Form of Notice of Borrowing
Exhibit C - Form of Notice of Account Designation
Exhibit D - Form of Notice of Prepayment
Exhibit E - Form of Notice of Conversion/Continuation
Exhibit F - Form of Officer’s Compliance Certificate
DMSLIBRARY01\31650438.v9
CREDIT AGREEMENT, dated as of February 27, 2018, by and between ALIGN
TECHNOLOGY, INC., a Delaware corporation, as the Borrower, and WELLS FARGO BANK,
NATIONAL ASSOCIATION, a national banking association, as the Lender.
STATEMENT OF PURPOSE
The Borrower has requested, and subject to the terms and conditions set forth in this Agreement,
the Lender has agreed to extend, certain credit facilities to the Borrower.
NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged by the parties hereto, such parties hereby agree as follows:
AGREEMENT
ARTICLE I
DEFINITIONS
SECTION 1.1 Definitions. The following terms when used in this Agreement shall have the
meanings assigned to them below:
“Acquisition” means any transaction, or any series of related transactions, consummated on or
after the date of this Agreement, by which any Credit Party or any of its Subsidiaries (a) acquires any line
of business, division or all or substantially all of the assets of any Person, or division thereof, whether
through purchase of assets, merger or otherwise or (b) directly or indirectly acquires (in one transaction or
as the most recent transaction in a series of transactions) at least a majority (in number of votes) of the
securities of a corporation which have ordinary voting power for the election of members of the board of
directors or the equivalent governing body (other than securities having such power only by reason of the
happening of a contingency) or a majority (by voting power) of the outstanding general partnership
interests of a partnership or membership interests of a limited liability company.
“Affiliate” means, with respect to a specified Person, another Person that directly, or indirectly
through one or more intermediaries, Controls or is Controlled by or is under common Control with the
Person specified.
“Agreement” means this Credit Agreement.
“Anti-Corruption Laws” means all laws, rules, and regulations of any jurisdiction applicable to
the Borrower or its Subsidiaries from time to time concerning or relating to bribery or corruption,
including, without limitation, the United States Foreign Corrupt Practices Act of 1977 and the rules and
regulations thereunder and the U.K. Bribery Act 2010 and the rules and regulations thereunder.
“Anti-Money Laundering Laws” means any and all laws, statutes, regulations or obligatory
government orders, decrees, ordinances or rules applicable to a Credit Party, its Subsidiaries or Affiliates
related to terrorism financing or money laundering, including any applicable provision of the Patriot Act
and The Currency and Foreign Transactions Reporting Act (also known as the “Bank Secrecy Act,” 31
U.S.C. §§ 5311-5330 and 12U.S.C. §§ 1818(s), 1820(b) and 1951-1959).
“Applicable Law” means all applicable provisions of constitutions, laws, statutes, ordinances,
rules, treaties, regulations, permits, licenses, approvals, binding interpretations and orders of
Governmental Authorities and all applicable orders and decrees of all courts and arbitrators.
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“Applicable Margin” means the corresponding percentages per annum as set forth below based
on the Consolidated Leverage Ratio:
Pricing
Level
Consolidated Leverage
Ratio
Commitment
Fee
LIBOR Base Rate
I Less than 1.00 to 1.00 0.15% 1.25% 0.25%
II Greater than or equal to
1.00 to 1.00, but less than
2.00 to 1.00
0.20% 1.50% 0.50%
III Greater than or equal to
2.00 to 1.00
0.25% 1.75% 0.75%
The Applicable Margin shall be determined and adjusted quarterly on the date five (5) Business Days
after the day on which the Borrower provides an Officer’s Compliance Certificate pursuant to
Section 8.2(a) for the most recently ended fiscal quarter of the Borrower (each such date, a “Calculation
Date”); provided that (a) the Applicable Margin shall be based on Pricing Level I until the first
Calculation Date occurring after the Closing Date and, thereafter the Pricing Level shall be determined by
reference to the Consolidated Leverage Ratio as of the last day of the most recently ended fiscal quarter of
the Borrower preceding the applicable Calculation Date, and (b) if the Borrower fails to provide an
Officer’s Compliance Certificate when due as required by Section 8.2(a) for the most recently ended
fiscal quarter of the Borrower preceding the applicable Calculation Date, the Applicable Margin from the
date on which such Officer’s Compliance Certificate was required to have been delivered shall be based
on Pricing Level III until such time as such Officer’s Compliance Certificate is delivered, at which time
the Pricing Level shall be determined by reference to the Consolidated Leverage Ratio as of the last day
of the most recently ended fiscal quarter of the Borrower preceding such Calculation Date. The
applicable Pricing Level shall be effective from one Calculation Date until the next Calculation Date.
Any adjustment in the Pricing Level shall be applicable to all Extensions of Credit then existing or
subsequently made or issued until the next adjustment in the Pricing Level in accordance with the terms
hereof.
Notwithstanding the foregoing, in the event that any financial statement or Officer’s Compliance
Certificate delivered pursuant to Section 8.1 or 8.2(a) is shown to be inaccurate, and such inaccuracy, if
corrected, would have led to the application of a higher Applicable Margin for any period (an “Applicable
Period”) than the Applicable Margin applied for such Applicable Period, then (A) the Borrower shall
immediately deliver to the Lender a corrected Officer’s Compliance Certificate for such Applicable
Period, (B) the Applicable Margin for such Applicable Period shall be determined as if the Consolidated
Leverage Ratio in the corrected Officer’s Compliance Certificate were applicable for such Applicable
Period, and (C) the Borrower shall immediately and retroactively be obligated to pay to the Lender the
accrued additional interest and fees owing as a result of such increased Applicable Margin for such
Applicable Period, which payment shall be promptly applied by the Lender in accordance with
Section 5.4. Nothing in this paragraph shall limit the rights of the Lender with respect to Sections 5.1(b)
and 10.2 nor any of its other rights under this Agreement or any other Loan Document.
“Asset Disposition” means the sale, transfer, license, lease or other disposition of any Property
(including any disposition of Equity Interests held by any Credit Party or any Subsidiary thereof) by any
Credit Party or any Subsidiary thereof.
“Attributable Indebtedness” means, on any date of determination, (a) in respect of any Capital
Lease Obligation of any Person, the capitalized amount thereof that would appear on a balance sheet of
such Person prepared as of such date in accordance with GAAP, and (b) in respect of any Synthetic
Lease, the capitalized amount or principal amount of the remaining lease payments under the relevant
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lease that would appear on a balance sheet of such Person prepared as of such date in accordance with
GAAP if such lease were accounted for as a Capital Lease Obligation.
“Bail-In Action” means the exercise of any Write-Down and Conversion Powers by the
applicable EEA Resolution Authority in respect of any liability of an EEA Financial Institution.
“Bail-In Legislation” means, with respect to any EEA Member Country implementing Article 55
of Directive 2014/59/EU of the European Parliament and of the Council of the European Union, the
implementing law for such EEA Member Country from time to time which is described in the EU Bail-In
Legislation Schedule.
“Bankruptcy Code” means 11 U.S.C. §§ 101 et seq.
“Base Rate” means, at any time, the highest of (a) the Prime Rate, (b) the Federal Funds Rate plus
0.50% and (c) LIBOR for an Interest Period of one month plus 1%; each change in the Base Rate shall
take effect simultaneously with the corresponding change or changes in the Prime Rate, the Federal Funds
Rate or LIBOR (provided that clause (c) shall not be applicable during any period in which LIBOR is
unavailable or unascertainable).
“Base Rate Loan” means any Loan bearing interest at a rate based upon the Base Rate as
provided in Section 5.1(a).
“Borrower” means Align Technology, Inc., a Delaware corporation.
“Business Day” means (a) for all purposes other than as set forth in clause (b) below, any day
other than a Saturday, Sunday or legal holiday on which banks in Charlotte, North Carolina, San
Francisco, California and New York, New York, are open for the conduct of their commercial banking
business and (b) with respect to all notices and determinations in connection with, and payments of
principal and interest on, any LIBOR Rate Loan, or any Base Rate Loan as to which the interest rate is
determined by reference to LIBOR, any day that is a Business Day described in clause (a) and that is also
a London Banking Day.
“Calculation Date” has the meaning assigned thereto in the definition of Applicable Margin.
“Capital Expenditures” means, with respect to the Borrower and its Subsidiaries on a
Consolidated basis, for any period, (a) the additions to property, plant and equipment and other capital
expenditures that are (or would be) set forth in a consolidated statement of cash flows of such Person for
such period prepared in accordance with GAAP and (b) Capital Lease Obligations paid during such
period.
“Capital Lease Obligations” of any Person means the obligations of such Person to pay rent or
other amounts under any lease of (or other arrangement conveying the right to use) real or personal
property, or a combination thereof, which obligations are required to be classified and accounted for as
capital leases on a balance sheet of such Person under GAAP, and the amount of such obligations shall be
the capitalized amount thereof determined in accordance with GAAP.
“Cash Collateralize” means, to pledge and deposit with, or deliver to the Lender as collateral for
L/C Obligations, cash or deposit account balances or, if the Lender shall agree, in its sole discretion, other
credit support, in each case pursuant to documentation in form and substance reasonably satisfactory to
the Lender; provided that Cash Collateral shall not include Equity Interests of any Foreign Subsidiary or
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Foreign Subsidiary Holding Company. “Cash Collateral” shall have a meaning correlative to the
foregoing and shall include the proceeds of such cash collateral and other credit support.
“Cash Collateralized Letter of Credit” has the meaning assigned thereto in Section 3.11(d).
“Cash Equivalents” means, collectively, (a) marketable direct obligations issued or
unconditionally guaranteed by the United States or any political subdivision, agency or public
instrumentality thereof maturing within one hundred twenty (120) days from the date of acquisition
thereof, (b) commercial paper maturing no more than one hundred twenty (120) days from the date of
creation thereof and currently having the highest rating obtainable from either S&P or Moody’s,
(c) certificates of deposit maturing no more than one hundred twenty (120) days from the date of creation
thereof issued by commercial banks incorporated under the laws of the United States, each having
combined capital, surplus and undivided profits of not less than $500,000,000 and having a rating of “A”
or better by a nationally recognized rating agency; provided that the aggregate amount invested in such
certificates of deposit shall not at any time exceed $5,000,000 for any one such certificate of deposit and
$10,000,000 for any one such bank, (d) time deposits maturing no more than one hundred twenty (120)
days from the date of creation thereof with commercial banks or savings banks or savings and loan
associations each having membership either in the FDIC or the deposits of which are insured by the FDIC
and in amounts not exceeding the maximum amounts of insurance thereunder, (e) solely in the case of a
Foreign Subsidiary, investments substantially equivalent to those referred to in clauses (a) through (d) of
this definition denominated in any foreign currency that is the local currency of such Foreign Subsidiary
comparable in tenor and credit quality to those referred to above and customarily used by companies for
cash management purposes in any jurisdiction outside the United States and (f) investments made in
accordance with the Borrower’s investment policy then in effect to the extent that, for purposes of this
Agreement, such policy has been provided in writing to the Lender and is reasonably acceptable to the
Lender.
“Cash Management Agreement” means any agreement to provide cash management services,
including treasury, depository, overdraft, credit or debit card (including non-card electronic payables and
purchasing cards), electronic funds transfer and other cash management arrangements.
“Change in Control” means an event or series of events by which:
(a) (i) any “person” or “group” (as such terms are used in Sections 13(d) and 14(d) of the
Exchange Act, but excluding any employee benefit plan of such person or its Subsidiaries, and any person
or entity acting in its capacity as trustee, agent or other fiduciary or administrator of any such plan)
becomes the “beneficial owner” (as defined in Rules 13d-3 and 13d-5 under the Exchange Act, except
that a “person” or “group” shall be deemed to have “beneficial ownership” of all Equity Interests that
such “person” or “group” has the right to acquire, whether such right is exercisable immediately or only
after the passage of time (such right, an “option right”)), directly or indirectly, of more than thirty-five
percent (35.0%) of the Equity Interests of the Borrower entitled to vote in the election of members of the
board of directors (or equivalent governing body) of the Borrower or (ii) a majority of the members of the
board of directors (or other equivalent governing body) of the Borrower shall not constitute Continuing
Directors; or
(b) there shall have occurred under any indenture or other instrument evidencing any
Indebtedness in excess of the Threshold Amount any “change in control” or similar provision (as set forth
in the indenture, agreement or other evidence of such Indebtedness) obligating the Borrower or any of its
Subsidiaries to repurchase, redeem or repay all or any part of the Indebtedness provided for therein.
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“CHAMPVA” means, collectively, the Civilian Health and Medical Program of the Department
of Veterans Affairs, and all laws, rules, regulations, manuals, orders, guidelines or requirements (whether
or not having the force of law) pertaining to such program, in each case as the same may be amended,
supplemented or otherwise modified from time to time.
“Change in Law” means the occurrence, after the date of this Agreement, of any of the following:
(a) the adoption or taking effect of any law, rule, regulation or treaty, (b) any change in any law, rule,
regulation or treaty or in the administration, interpretation, implementation or application thereof by any
Governmental Authority or (c) the making or issuance of any request, rule, guideline or directive
(whether or not having the force of law) by any Governmental Authority; provided that notwithstanding
anything herein to the contrary, (i) the Dodd-Frank Wall Street Reform and Consumer Protection Act and
all requests, rules, guidelines or directives thereunder or issued in connection therewith and (ii) all
requests, rules, guidelines or directives promulgated by the Bank for International Settlements, the Basel
Committee on Banking Supervision (or any successor or similar authority) or the United States or foreign
regulatory authorities, in each case pursuant to Basel III, shall in each case be deemed to be a “Change in
Law”, regardless of the date enacted, adopted, implemented or issued.
“Closing Date” means the date of this Agreement.
“CMS” means The Centers for Medicare and Medicaid Services of the United States Department
of Health and Human Services, and any Governmental Authority successor thereto.
“Code” means the Internal Revenue Code of 1986, and the rules and regulations promulgated
thereunder.
“Commitment” means, collectively, the Revolving Credit Commitment and the L/C
Commitment.
“Commitment Fee” has the meaning assigned thereto in Section 5.3.
“Commodity Exchange Act” means the Commodity Exchange Act (7 U.S.C. § 1 et seq.).
“Connection Income Taxes” means Other Connection Taxes that are imposed on or measured by
net income (however denominated) or that are franchise Taxes or branch profits Taxes.
“Consolidated” means, when used with reference to financial statements or financial statement
items of any Person, such statements or items on a consolidated basis in accordance with applicable
principles of consolidation under GAAP.
“Consolidated EBITDA” means, for any period, the sum of the following determined on a
Consolidated basis, without duplication, for the Borrower and its Subsidiaries in accordance with GAAP:
(a) Consolidated Net Income for such period plus (b) the sum of the following, without duplication, to the
extent deducted in determining Consolidated Net Income for such period: (i) provision for Taxes based on
income, profits or capital of the Borrower or its Subsidiaries, including without limitation, federal, state,
franchise, excise and similar Taxes and foreign withholding Taxes paid or accrued during such period,
including penalties and interest related to such Taxes or arising from any Tax examinations,
(ii) Consolidated Interest Expense, (iii) amortization, depreciation and other non-cash charges, expenses
or losses, including, without limitation, non-cash expenses related to stock-based compensation and other
non-cash compensation-based expenses (except to the extent that such non-cash charges, expenses or
losses are reserved for cash charges to be taken in the future), (iv) extraordinary, unusual or non-recurring
losses, charges or expenses (excluding extraordinary losses from discontinued operations); (v)
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Transaction Costs, and (vi) out-of-pocket costs and expenses incurred by the Borrower or its Subsidiaries
in connection with (A) issuances of Equity Interests of the Borrower, (B) any disposition of assets
permitted hereunder, or (C) any incurrence, amendment, modification, refinancing or repayment of
Indebtedness, in each case whether or not successful and including, without limitation, accounting and
advisory fees in an aggregate amount not to exceed $20,000,000 in any such period less (c) the sum of the
following, without duplication, to the extent included in determining Consolidated Net Income for such
period: (i) interest income, (ii) any extraordinary gains and (iii) non-cash gains or non-cash items
increasing Consolidated Net Income. For purposes of this Agreement, Consolidated EBITDA shall be
adjusted on a Pro Forma Basis.
“Consolidated Funded Indebtedness” means, as of any date of determination with respect to the
Borrower and its Subsidiaries on a Consolidated basis, without duplication, the sum of (i) the principal
amount of all Indebtedness of the type described in clauses (a) (including any Convertible Debt Security),
(b) (only to the extent of earn-outs and Holdbacks payable in cash that are required to be set forth on the
Consolidated balance sheet of the Borrower and its Subsidiaries in an amount calculated in accordance
with GAAP), (c) of the definition of Indebtedness on such date, plus (ii) the aggregate amount of
Indebtedness relating to the drawn and unreimbursed amounts outstanding under letters of credit and
bankers’ acceptances on such date plus (iii) guarantees of Indebtedness of the type described in clauses (i)
and (ii) above on such date. Consolidated Funded Indebtedness of the Borrower and its Subsidiaries shall
include the Indebtedness of any partnership in which any of the Borrower or its Subsidiaries is a general
partner, unless such Indebtedness is expressly made non-recourse to such Person.
“Consolidated Interest Coverage Ratio” means, as of any date of determination, the ratio of
(a) Consolidated EBITDA for the period of four (4) consecutive fiscal quarters ending on such date to
(b) Consolidated Interest Expense for the period of four (4) consecutive fiscal quarters ending on such
date
“Consolidated Interest Expense” means, for any period, determined on a Consolidated basis,
without duplication, for the Borrower and its Subsidiaries in accordance with GAAP, interest expense
(including, without limitation, interest expense attributable to Capital Lease Obligations) for such period.
“Consolidated Leverage Ratio” means, as of any date of determination, the ratio of (a)
Consolidated Funded Indebtedness on such date to (b) Consolidated EBITDA for the period of four (4)
consecutive fiscal quarters ending on such date.
“Consolidated Net Income” means, for any period, the net income (or loss) of the Borrower and
its Subsidiaries for such period, determined on a Consolidated basis, without duplication, in accordance
with GAAP; provided, that in calculating Consolidated Net Income of the Borrower and its Subsidiaries
for any period, there shall be excluded (without duplication) (a) the net income (or loss) of any Person
(other than a Subsidiary which shall be subject to clause (c) below), in which the Borrower or any of its
Subsidiaries has a joint interest with a third party, except to the extent such net income is actually paid in
cash to the Borrower or any of its Subsidiaries by dividend or other distribution during such period,
(b) subject to any pro forma adjustments required by this Agreement, the net income (or loss) of any
Person accrued prior to the date it becomes a Subsidiary of the Borrower or any of its Subsidiaries or is
merged into or consolidated with the Borrower or any of its Subsidiaries or that Person’s assets are
acquired by the Borrower or any of its Subsidiaries except to the extent included pursuant to the foregoing
clause (a), (c) the net income (if positive), of any Subsidiary to the extent that the declaration or payment
of dividends or similar distributions by such Subsidiary to the Borrower or any of its Subsidiaries of such
net income (i) is not at the time permitted by operation of the terms of its charter or any agreement,
instrument, judgment, decree, order, statute, rule or governmental regulation applicable to such
Subsidiary or (ii) would be subject to any taxes payable on such dividends or distributions, but in each
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case only to the extent of such prohibition or taxes and (d) any gain or loss from Asset Dispositions
during such period.
“Continuing Directors” means the directors of the Borrower on the Closing Date and each other
director of the Borrower, if such other Person’s nomination for election to the board of directors (or
equivalent governing body) of the Borrower is approved (either by a specific vote or by approval of a
proxy statement issued by the Borrower on behalf of its board of directors in which such individual is
named as a nominee for director) by at least a majority of the directors then in office who were directors
on the Closing Date or directors whose election was previously so approved.
“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 ability to exercise voting power,
by contract or otherwise. “Controlling” and “Controlled” have meanings correlative thereto.
“Convertible Debt Security” means any debt security or note the terms of which provide for the
conversion thereof into Equity Interests, cash or a combination of Equity Interests and cash.
“Credit Parties” means, collectively, the Borrower and the Subsidiary Guarantors.
“Debtor Relief Laws” means the Bankruptcy Code of the United States of America, and all other
liquidation, conservatorship, bankruptcy, assignment for the benefit of creditors, moratorium,
rearrangement, receivership, insolvency, reorganization, or similar debtor relief Laws of the United States
or other applicable jurisdictions from time to time in effect.
“Default” means any of the events specified in Section 10.1 which with the passage of time, the
giving of notice or any other condition, would constitute an Event of Default.
“Disclosure Letter” means the disclosure letter, dated the Closing Date, delivered by the
Borrower to the Lender in connection with this Agreement, as may be updated from time to time in
accordance with the terms of this Agreement and the other Loan Documents.
“Disqualified Equity Interests” means any Equity Interests that, by their terms (or by the terms of
any security or other Equity Interest into which they are convertible or for which they are exchangeable)
or upon the happening of any event or condition, (a) mature or are mandatorily redeemable (other than
solely for Qualified Equity Interests), pursuant to a sinking fund obligation or otherwise (except as a
result of a change of control or asset sale so long as any rights of the holders thereof upon the occurrence
of a change of control or asset sale event shall be subject to the prior repayment in full of the Loans and
all other Obligations that are accrued and payable and the termination of the Commitments), (b) are
redeemable at the option of the holder thereof (other than solely for Qualified Equity Interests) (except as
a result of a change of control or asset sale so long as any rights of the holders thereof upon the
occurrence of a change of control or asset sale event shall be subject to the prior repayment in full of the
Loans and all other Obligations that are accrued and payable and the termination of the Commitments), in
whole or in part, (c) provide for the scheduled payment of dividends in cash or (d) are or become
convertible into or exchangeable for Indebtedness or any other Equity Interests that would constitute
Disqualified Equity Interests, in each case, prior to the date that is 91 days after the Revolving Credit
Maturity Date; provided that if such Equity Interests are issued pursuant to a plan for the benefit of the
Borrower or its Subsidiaries or by any such plan to such officers or employees, such Equity Interests shall
not constitute Disqualified Equity Interests solely because they may be required to be repurchased by the
Borrower or its Subsidiaries in order to satisfy applicable statutory or regulatory obligations; provided
further that Equity Interests constituting Qualified Equity Interests when issued shall not cease to
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constitute Qualified Equity Interests solely as result of the subsequent extension of the Revolving Credit
Maturity Date.
“Dollars” or “$” means, unless otherwise qualified, dollars in lawful currency of the United
States.
“Domestic Subsidiary” means any Subsidiary organized under the laws of any political
subdivision of the United States, other than (i) any Foreign Subsidiary Holding Company and (ii) and any
direct or indirect Subsidiary of a Foreign Subsidiary Holding Company.
“EEA Financial Institution” means (a) any credit institution or investment firm established in any
EEA Member Country which is subject to the supervision of an EEA Resolution Authority, (b) any entity
established in an EEA Member Country which is a parent of an institution described in clause (a) of this
definition, or (c) any financial institution established in an EEA Member Country which is a subsidiary of
an institution described in clauses (a) or (b) of this definition and is subject to consolidated supervision
with its parent.
“EEA Member Country” means any of the member states of the European Union, Iceland,
Liechtenstein, and Norway.
“EEA Resolution Authority” means any public administrative authority or any Person entrusted
with public administrative authority of any EEA Member Country (including any delegee) having
responsibility for the resolution of any EEA Financial Institution.
“Employee Benefit Plan” means (a) any employee benefit plan within the meaning of
Section 3(3) of ERISA that is maintained for employees of any Credit Party or any ERISA Affiliate or
(b) any Pension Plan or Multiemployer Plan that has at any time within the preceding seven (7) years
been maintained, funded or administered for the employees of any Credit Party or any current or former
ERISA Affiliate.
“Environmental Claims” means any and all administrative, regulatory or judicial actions, suits,
demands, demand letters, claims, liens, accusations, allegations, notices of noncompliance or violation,
investigations (other than internal reports prepared by any Person in the ordinary course of business and
not in response to any third party action or request of any kind) or proceedings relating in any way to any
actual or alleged violation of or liability under any Environmental Law or relating to any permit issued, or
any approval given, under any such Environmental Law, including, without limitation, any and all claims
by Governmental Authorities for enforcement, cleanup, removal, response, remedial or other actions or
damages, contribution, indemnification, cost recovery, compensation or injunctive relief resulting from
Hazardous Materials or arising from alleged injury or threat of injury to public health or the environment.
“Environmental Laws” means any and all federal, foreign, state, provincial and local laws,
statutes, ordinances, codes, rules, standards and regulations, permits, licenses, approvals, interpretations
and orders of courts or Governmental Authorities, relating to the protection of public health or the
environment, including, but not limited to, requirements pertaining to the manufacture, processing,
distribution, use, treatment, storage, disposal, transportation, handling, reporting, licensing, permitting,
investigation or remediation of Hazardous Materials.
“Equity Interests” means (a) in the case of a corporation, capital stock, (b) in the case of an
association or business entity, any and all shares, interests, participations, rights or other equivalents
(however designated) of capital stock, (c) in the case of a partnership, partnership interests (whether
general or limited), (d) in the case of a limited liability company, membership interests, (e) any other
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interest or participation that confers on a Person the right to receive a share of the profits and losses of, or
distributions of assets of, the issuing Person and (f) any and all warrants, rights or options to purchase any
of the foregoing, but excluding any Convertible Debt Securities and any Permitted Call Spread
Agreement.
“ERISA” means the Employee Retirement Income Security Act of 1974, and the rules and
regulations thereunder.
“ERISA Affiliate” means any Person who together with any Credit Party or any of its
Subsidiaries is treated as a single employer within the meaning of Section 414(b), (c), (m) or (o) of the
Code or Section 4001(b) of ERISA.
“EU Bail-In Legislation Schedule” means the EU Bail-In Legislation Schedule published by the
Loan Market Association (or any successor thereto), as in effect from time to time.
“Eurodollar Reserve Percentage” means, for any day, the percentage which is in effect for such
day as prescribed by the Board of Governors of the Federal Reserve System (or any successor) for
determining the maximum reserve requirement (including, without limitation, any basic, supplemental or
emergency reserves) in respect of eurocurrency liabilities or any similar category of liabilities for a
member bank of the Federal Reserve System in New York City.
“Event of Default” means any of the events specified in Section 10.1; provided that any
requirement for passage of time, giving of notice, or any other condition, has been satisfied.
“Exchange Act” means the Securities Exchange Act of 1934 (15 U.S.C. § 77 et seq.).
“Excluded Subsidiary” means any Foreign Subsidiary and any Foreign Subsidiary Holding
Company.
“Excluded Swap Obligation” means, with respect to any Credit Party, any Swap Obligation if,
and to the extent that, all or a portion of the liability of such Credit Party for or the guarantee of such
Credit Party of, or the grant by such Credit Party of a security interest to secure, such Swap Obligation (or
any liability or guarantee thereof) is or becomes illegal under the Commodity Exchange Act or any rule,
regulation or order of the Commodity Futures Trading Commission (or the application or official
interpretation of any thereof) by virtue of such Credit Party’s failure for any reason to constitute an
“eligible contract participant” as defined in the Commodity Exchange Act and the regulations thereunder
at the time the liability for or the guarantee of such Credit Party or the grant of such security interest
becomes effective with respect to such Swap Obligation (such determination being made after giving
effect to any applicable keepwell, support or other agreement for the benefit of the applicable Credit
Party, including under the keepwell provisions in the Guaranty Agreement). If a Swap Obligation arises
under a master agreement governing more than one swap, such exclusion shall apply only to the portion
of such Swap Obligation that is attributable to swaps for which such guarantee or security interest is or
becomes illegal for the reasons identified in the immediately preceding sentence of this definition.
“Excluded Taxes” means any of the following Taxes imposed on or with respect to the Lender or
required to be withheld or deducted from a payment to the Lender, (a) Taxes imposed on or measured by
net income (however denominated), franchise Taxes, and branch profits Taxes, in each case, (i) imposed
as a result of the Lender being organized under the laws of, or having its principal office or its applicable
Lending Office located in, the jurisdiction imposing such Tax (or any political subdivision thereof) or (ii)
that are Other Connection Taxes, (b) United States federal withholding Taxes imposed on amounts
payable to or for the account of the Lender with respect to an applicable interest in a Loan or
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Commitment pursuant to a law in effect on the date on which the Lender changes its Lending Office,
except in each case to the extent that, pursuant to Section 5.11, amounts with respect to such Taxes were
payable to the Lender immediately before it changed its Lending Office and (d) any United States federal
withholding Taxes imposed under FATCA.
“Existing Credit Agreement” means that certain Credit Agreement, dated as of March 22, 2013,
by and between the Borrower and the Lender, as amended, supplemented or otherwise modified from
time to time.
“Existing Maturity Date” has the meaning set forth in Section 2.7(a).
“Extended Letter of Credit” has the meaning assigned thereto in Section 3.1(b).
“Extension Date” has the meaning set forth in Section 2.7(a).
“Extensions of Credit” means (a) an amount equal to the aggregate principal amount of all
Revolving Credit Loans made by the Lender then outstanding and the L/C Obligations then outstanding
or (b) the making of any Loan or the issuance of any Letter of Credit by the Lender, as the context
requires.
“FATCA” means Sections 1471 through 1474 of the Code, as of the date of this Agreement (or
any amended or successor version that is substantively comparable and not materially more onerous to
comply with), any current or future regulations or official interpretations thereof, and any agreements
entered into pursuant to Section 1471(b)(1) of the Code.
“FDA” means the United States Food and Drug Administration and any successor thereto.
“FDIC” means the Federal Deposit Insurance Corporation.
“Federal Funds Rate” means, for any day, the rate per annum equal to the weighted average of the
rates on overnight federal funds transactions with members of the Federal Reserve System, as published
by the Federal Reserve Bank of New York on the Business Day next succeeding such day, provided that
if such rate is not so published for any day which is a Business Day, the Federal Funds Rate for such day
shall be the average of the quotation for such day on such transactions received by the Lender from three
federal funds brokers of recognized standing selected by the Lender. Notwithstanding the foregoing, if
the Federal Funds Rate shall be less than zero, such rate shall be deemed to be zero for purposes of this
Agreement.
“Fiscal Year” means the fiscal year of the Borrower and its Subsidiaries ending on December 31.
“Foreign Subsidiary” means any Subsidiary that is not a Domestic Subsidiary.
“Foreign Subsidiary Holding Company” means any Subsidiary organized under the laws of a
jurisdiction located in the United States substantially all of the assets of which consist of Equity Interests
of one or more Subsidiaries that are “controlled foreign corporations” within the meaning of Section 957
of the Code or intercompany obligations owed or treated as owed by one or more Subsidiaries that are
controlled foreign corporations.
“Forward Agreement” means any agreement (including, but not limited to, any accelerated share
repurchase agreement, forward agreement, derivative or other share repurchase agreement in the form of
an equity option or forward or other derivative) pursuant to which, among other things, the counterparty is
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required to deliver to the Borrower shares of common stock of the Borrower, cash in lieu of delivering
shares of common stock or cash representing the termination value of such forward or option or a
combination thereof from time to time upon settlement, exercise or early termination of such forward or
option or other derivative.
“GAAP” means generally accepted accounting principles in the United States set forth in the
opinions and pronouncements of the Accounting Principles Board and the American Institute of Certified
Public Accountants and statements and pronouncements of the Financial Accounting Standards Board or
such other principles as may be approved by a significant segment of the accounting profession in the
United States, that are applicable to the circumstances as of the date of determination, consistently
applied, subject to the provisions of Section 1.3.
“Government Reimbursement Program” means (a) Medicare, (b) Medicaid, (c) the Federal
Employees Health Benefit Program under 5 U.S.C. §§ 8902 et seq., (d) TRICARE, (e) CHAMPVA, or (f)
if applicable within the context of this Agreement, any agent, administrator, administrative contractor,
intermediary or carrier for any of the foregoing.
“Governmental Approvals” means all authorizations, consents, approvals, permits, licenses and
exemptions of, and all registrations and filings with or issued by, any Governmental Authorities.
“Governmental Authority” means the government of any nation or any political subdivision
thereof, whether at the national, state, territorial, provincial, municipal or any other level, and any agency,
authority, instrumentality, regulatory body, court, central bank or other entity exercising executive,
legislative, judicial, taxing, regulatory or administrative powers or functions of, or pertaining to,
government (including any supra-national bodies such as the European Union or the European Central
Bank). The Term “Governmental Authority” shall further include any institutional review board, ethics
committee, data monitoring committee, or other committee or entity with defined authority to oversee
Regulatory Matters, including CMS and any Medicare or Medicaid administrative contractors,
intermediaries or carriers.
“Guarantee” of or by any Person (the “guarantor”) means any obligation, contingent or otherwise,
of the guarantor guaranteeing or having the economic effect of guaranteeing any Indebtedness or other
obligation of any other Person (the “primary obligor”) in any manner, whether directly or indirectly, and
including any obligation of the guarantor, direct or indirect, (a) to purchase or pay (or advance or supply
funds for the purchase or payment of) such Indebtedness or other obligation or to purchase (or to advance
or supply funds for the purchase of) any security for the payment thereof, (b) to purchase or lease
property, securities or services for the purpose of assuring the owner of such Indebtedness or other
obligation of the payment thereof, (c) to maintain working capital, equity capital or any other financial
statement condition or liquidity of the primary obligor so as to enable the primary obligor to pay such
Indebtedness or other obligation, (d) as an account party in respect of any letter of credit or letter of
guaranty issued to support such Indebtedness or obligation or (e) for the purpose of assuming in any other
manner the obligee in respect of such Indebtedness or other obligation of the payment or performance
thereof or to protect such obligee against loss in respect thereof (whether in whole or in part); provided
that the term “Guarantee” shall not include endorsements for collection or deposit or warranty obligations
in the ordinary course of business or customary indemnification obligations in connection with
transactions not prohibited by the Loan Documents.
“Guaranty Agreement” means the unconditional guaranty agreement of even date herewith
executed by the Subsidiary Guarantors in favor of the Lender which shall be in form and substance
acceptable to the Lender.
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“Hazardous Materials” means any substances or materials (a) which are or become defined as
hazardous wastes, hazardous substances, pollutants, contaminants, chemical substances or mixtures or
toxic substances under any applicable Environmental Law, (b) which are toxic, explosive, corrosive,
flammable, infectious, radioactive, carcinogenic, mutagenic or otherwise harmful to public health or the
environment and are or become regulated by any applicable Governmental Authority, (c) the presence of
which require investigation or remediation under any applicable Environmental Law or common law,
(d) the discharge or emission or release of which requires a permit or license under any applicable
Environmental Law or other Governmental Approval, (e) which are deemed by an applicable
Governmental Authority to constitute a nuisance or a trespass which pose a health or safety hazard to
Persons or neighboring properties, or (f) which contain, without limitation, asbestos, polychlorinated
biphenyls, urea formaldehyde foam insulation, petroleum hydrocarbons, petroleum derived substances or
waste, crude oil, nuclear fuel, natural gas or synthetic gas.
“Health Care Laws” means, collectively, any and all Applicable Laws relating to any of the
following: (a) fraud and abuse (including the following statutes, as amended, modified or supplemented
from time to time and any successor statutes thereto and regulations promulgated from time to time
thereunder: the federal Anti-Kickback Statute (42 U.S.C. § 1320a-7b(b)), the Stark Law (42 U.S.C. §
1395nn and §1395(q)), the civil False Claims Act (31 U.S.C. § 3729 et seq.), the federal health care
program exclusion provisions (42 U.S.C. § 1320a-7), the Civil Monetary Penalties Act (42 U.S.C. §
1320a-7a), and the Medicare Prescription Drug, Improvement, and Modernization Act of 2003 (Pub. L.
No. 108-173)); (b) any Government Reimbursement Program; (c) HIPAA and Other Privacy Laws; and
(d) any other Applicable Law regulating the health care industry.
“Health Care Permits” means any and all permits, licenses, authorizations, certificates,
certificates of need, accreditations and plans of third-party accreditation agencies (such as The Joint
Commission) that are (a) necessary to enable any Credit Party to continue to conduct its business as it is
conducted on the Closing Date, or (b) required under any Health Care Law.
“Hedge Agreement” means (a) any and all rate swap transactions, basis swaps, credit derivative
transactions, forward rate transactions, commodity swaps, commodity options, forward commodity
contracts, equity or equity index swaps or options, bond or bond price or bond index swaps or options or
forward bond or forward bond price or forward bond index transactions, interest rate options, forward
foreign exchange transactions, cap transactions, floor transactions, collar transactions, currency swap
transactions, cross-currency rate swap transactions, currency options, spot contracts, or any other similar
transactions or any combination of any of the foregoing (including any options to enter into any of the
foregoing), whether or not any such transaction is governed by or subject to any master agreement, and
(b) any and all transactions of any kind, and the related confirmations, which are subject to the terms and
conditions of, or governed by, any form of master agreement published by the International Swaps and
Derivatives Association, Inc., any International Foreign Exchange Master Agreement, or any other master
agreement; provided that the term “Hedge Agreement” shall not include (i) any Permitted Call Spread
Agreement, (ii) any derivative instruments issued under equity incentive or similar plans (including any
stock option or phantom stock plan), (iii) any forward, option, warrant agreement or Forward Agreement
for the purchase or sale of Equity Interests of the Borrower, (iv) contracts for the purchase of securities of
the Borrower or (v) any items described in this definition to the extent that it constitutes a derivative
security embedded in Convertible Debt Securities issued by the Borrower.
“Hedge Termination Value” means, in respect of any one or more Hedge Agreements, after
taking into account the effect of any legally enforceable netting agreement relating to such Hedge
Agreements, (a) for any date on or after the date such Hedge Agreements have been closed out and
termination value(s) determined in accordance therewith, such termination value(s), and (b) for any date
prior to the date referenced in clause (a), the amount(s) determined as the mark-to-market value(s) for
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such Hedge Agreements, as determined based upon one or more mid-market or other readily available
quotations provided by any recognized dealer in such Hedge Agreements (which may include the Lender
or any Affiliate of the Lender).
“HIPAA” means the Health Insurance Portability and Accountability Act of 1996, Pub. L. No.
104-191, Title II, Subtitle F, as the same may be amended, modified or supplemented from time to time,
and any and all rules or regulations promulgated from time to time thereunder.
“HIPAA and Other Privacy Laws” means (a) HIPAA; (b) the Health Information Technology for
Economic and Clinical Health Act (Title XIII of the American Recovery and Reinvestment Act of 2009),
as the same may be amended, modified or supplemented from time to time; (c) any successor statute
thereto; and (d) any applicable state and local laws regulating the privacy and/or security of patient
protected health or personally identifiable information, in each case as the same may be amended,
modified or supplemented from time to time, any successor statutes thereto, and any and all rules or
regulations promulgated from time to time thereunder.
“Holdback” means any portion of the purchase price for a Permitted Acquisition not paid at the
closing therefor but held by the Borrower or any Subsidiary for satisfaction of indemnification obligations
or purchase price adjustments.
“Immaterial Subsidiary” means, as of any date of determination, any Subsidiary of the Borrower
that does not have (a) assets with a value in excess of 5.0% of the total assets and (b) revenues (for the
most recently completed period of four consecutive fiscal quarters) representing in excess of 5.0% of total
revenues, of the Borrower and its Subsidiaries on a consolidated basis as of the last day of the most
recently completed period of four consecutive fiscal quarters for which financial statements have been
delivered to Lender pursuant to Section 8.1(a) or (b); provided that (i) the aggregate value of the assets of
all Immaterial Subsidiaries (other than Excluded Subsidiaries) that have not become Subsidiary
Guarantors shall not exceed 10.0% of the total assets and (ii) the aggregate revenue of all Immaterial
Subsidiaries (other than Excluded Subsidiaries) that have not become Subsidiary Guarantors shall not
exceed 10.0% of the total revenues, of the Borrower and its Subsidiaries on a consolidated basis as of the
last day of the most recently completed period of four consecutive fiscal quarters for which financial
statements have been delivered to Lender pursuant to Section 8.1(a) or (b).
“Indebtedness” means, with respect to any Person at any date and without duplication, the
following:
(a) all liabilities, obligations and indebtedness for borrowed money including, but not limited
to, obligations evidenced by bonds, debentures, notes or other similar instruments of any such Person;
(b) all obligations to pay the deferred purchase price of property or services of any such
Person (including, without limitation, all payment obligations under earn-out or similar agreements or any
Holdback), except (i) trade payables arising in the ordinary course of business not more than one hundred
eighty (180) days past due, or that are currently being contested in good faith by appropriate proceedings
and with respect to which reserves in conformity with GAAP have been provided for on the books of such
Person, (ii) deferred compensation and (iii) intercompany liabilities in respect of cost-plus or transfer
pricing arrangements for the purchase of products or services or the licensing of intellectual property;
(c) the Attributable Indebtedness of such Person with respect to such Person’s Capital Lease
Obligations and Synthetic Leases (regardless of whether accounted for as indebtedness under GAAP);
(d) all obligations of such Person under conditional sale or other title retention agreements
relating to property purchased by such Person to the extent of the lesser of the amount of such obligations
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and the value of such property (other than customary reservations or retentions of title under agreements
with suppliers entered into in the ordinary course of business);
(e) all Indebtedness of any other Person secured by a Lien on any asset owned or being
purchased by such Person (including indebtedness arising under conditional sales or other title retention
agreements except trade payables arising in the ordinary course of business), whether or not such
indebtedness shall have been assumed by such Person or is limited in recourse;
(f) all obligations, contingent or otherwise, of any such Person relative to the face amount of
letters of credit, whether or not drawn, including, without limitation, any Reimbursement Obligation, and
banker’s acceptances issued for the account of any such Person;
(g) all obligations of any such Person in respect of Disqualified Equity Interests;
(h) all Convertible Debt Securities;
(i) all net obligations of such Person under any Hedge Agreements; and
(j) all Guarantees of any such Person with respect to any of the foregoing.
For all purposes hereof, the Indebtedness of any Person shall include the Indebtedness of any
partnership in which such Person is a general partner, unless such Indebtedness is expressly made non-
recourse to such Person. In respect of Indebtedness of another Person secured by a Lien on the assets of
the specified Person, the amount of such Indebtedness as of any date of determination will be the lesser of
(x) the fair market value of such assets as of such date and (y) the amount of such Indebtedness as of such
date.
The amount of any net obligation under any Hedge Agreement on any date shall be deemed to be
the Hedge Termination Value thereof as of such date.
“Indemnified Taxes” means (a) Taxes, other than Excluded Taxes, imposed on or with respect to
any payment made by or on account of any obligation of any Credit Party under any Loan Document and
(b) to the extent not otherwise described in clause (a), Other Taxes.
“Indemnitee” has the meaning assigned thereto in Section 12.3(b).
“Information” has the meaning assigned thereto in Section 12.10.
“Insurance and Condemnation Event” means the receipt by any Credit Party or any of its
Subsidiaries of any cash insurance proceeds or condemnation award payable by reason of theft, loss,
physical destruction or damage, taking or similar event with respect to any of their respective Property.
“Interest Period” means, as to each LIBOR Rate Loan, the period commencing on the date such
LIBOR Rate Loan is disbursed or converted to or continued as a LIBOR Rate Loan and ending on the
date one (1), two (2), three (3), or six (6) months or, if agreed by the Lender, twelve (12) months
thereafter, in each case as selected by the Borrower in its Notice of Borrowing or Notice of
Conversion/Continuation and subject to availability; provided that:
(a) the Interest Period shall commence on the date of advance of or conversion to or
continuation of any LIBOR Rate Loan and, in the case of immediately successive Interest Periods, each
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successive Interest Period shall commence on the date on which the immediately preceding Interest
Period expires;
(b) if any Interest Period would otherwise expire on a day that is not a Business Day, such
Interest Period shall expire on the next succeeding Business Day; provided that if any Interest Period with
respect to a LIBOR Rate Loan would otherwise expire on a day that is not a Business Day but is a day of
the month after which no further Business Day occurs in such month, such Interest Period shall expire on
the immediately preceding Business Day;
(c) any Interest Period with respect to a LIBOR Rate Loan 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 the relevant calendar
month at the end of such Interest Period;
(d) no Interest Period shall extend beyond the Revolving Credit Maturity Date; and
(e) there shall be no more than ten (10) Interest Periods in effect at any time.
“Interstate Commerce Act” means the body of law commonly known as the Interstate Commerce
Act (49 U.S.C. App. § 1 et seq.).
“Investment” means, with respect to any Person, that such Person (a) purchases, owns, invests in
or otherwise acquires (in one transaction or a series of transactions), directly or indirectly, any Equity
Interests, interests in any partnership or joint venture (including, without limitation, the creation or
capitalization of any Subsidiary), evidence of Indebtedness or other obligation or security, or substantially
all or a portion of the business or assets of, any other Person, (b) makes any Acquisition or (c) makes,
directly or indirectly, any loans, advances or extensions of credit to, or any investment in cash or by
delivery of Property in, any other Person.
“Investment Company Act” means the Investment Company Act of 1940 (15 U.S.C. § 80(a)(1),
et seq.).
“IRS” means the United States Internal Revenue Service.
“ISP98” means the International Standby Practices (1998 Revision, effective January 1, 1999),
International Chamber of Commerce Publication No. 590.
“L/C Commitment” means the obligation of the Lender to issue Letters of Credit for the account
of the Borrower or one or more of its Subsidiaries from time to time in an aggregate amount not to exceed
the L/C Sublimit.
“L/C Obligations” means at any time, an amount equal to the sum of (a) the aggregate undrawn
and unexpired face amount of the then outstanding Letters of Credit and (b) the aggregate amount of
drawings under Letters of Credit which have not then been reimbursed pursuant to Section 3.5.
“L/C Sublimit” means the lesser of (a) $50,000,000 and (b) the Revolving Credit Commitment.
“Lender” means Wells Fargo together with its permitted successors and assigns.
“Lending Office” means the office of the Lender maintaining the Lender’s Extensions of Credit.
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“Letter of Credit Application” means an application requesting the Lender to issue a Letter of
Credit and a reimbursement agreement, in each case in the form specified by the Lender from time to
time.
“Letters of Credit” means the collective reference to letters of credit issued pursuant to
Section 3.1.
“LIBOR” means, subject to the implementation of a Replacement Rate in accordance with
Section 5.8(c),
(a) for any interest rate calculation with respect to a LIBOR Rate Loan, the rate of interest
per annum determined on the basis of the rate for deposits in Dollars for a period equal to the applicable
Interest Period as published by the ICE Benchmark Administration Limited, a United Kingdom company,
or a comparable or successor quoting service approved by the Lender, at approximately 11:00 a.m.
(London time) two (2) London Banking Days prior to the first day of the applicable Interest Period. If,
for any reason, such rate is not so published then “LIBOR” shall be determined by the Lender to be the
arithmetic average of the rate per annum at which deposits in Dollars would be offered by first class
banks in the London interbank market to the Lender at approximately 11:00 a.m. (London time) two (2)
London Banking Days prior to the first day of the applicable Interest Period for a period equal to such
Interest Period, and
(b) for any interest rate calculation with respect to a Base Rate Loan, the rate of interest per
annum determined on the basis of the rate for deposits in Dollars for an Interest Period equal to one
month (commencing on the date of determination of such interest rate) as published by the ICE
Benchmark Administration Limited, a United Kingdom company, or a comparable or successor quoting
service approved by the Lender, at approximately 11:00 a.m. (London time) on such date of
determination, or, if such date is not a Business Day, then the immediately preceding Business Day. If,
for any reason, such rate is not so published then “LIBOR” for such Base Rate Loan shall be determined
by the Lender to be the arithmetic average of the rate per annum at which deposits in Dollars would be
offered by first class banks in the London interbank market to the Lender at approximately 11:00 a.m.
(London time) on such date of determination for a period equal to one month commencing on such date of
determination.
Each calculation by the Lender of LIBOR shall be conclusive and binding for all purposes, absent
manifest error.
Notwithstanding the foregoing, (x) in no event shall LIBOR (including, without limitation, any
Replacement Rate with respect thereto) be less than 0% and (y) unless otherwise specified in any
amendment to this Agreement entered into in accordance with Section 5.8(c), in the event that a
Replacement Rate with respect to LIBOR is implemented then all references herein to LIBOR shall be
deemed references to such Replacement Rate.
“LIBOR Rate” means a rate per annum determined by the Lender pursuant to the following
formula:
LIBOR Rate = LIBOR
1.00-Eurodollar Reserve Percentage
“LIBOR Rate Loan” means any Loan bearing interest at a rate based upon the LIBOR Rate as
provided in Section 5.1(a).
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“Lien” means, with respect to any asset, any mortgage, leasehold mortgage, lien, pledge, charge,
security interest, hypothecation or encumbrance of any kind in respect of such asset. For the purposes of
this Agreement, a Person shall be deemed to own subject to a Lien any asset which it has acquired or
holds subject to the interest of a vendor or lessor under any conditional sale agreement, Capital Lease
Obligation or other title retention agreement relating to such asset.
“Loan Documents” means, collectively, this Agreement, the Revolving Credit Note, the Letter of
Credit Applications, the Guaranty Agreement, and each other document, instrument, certificate and
agreement executed and delivered by the Credit Parties or any of their respective Subsidiaries in favor of
or provided to the Lender in connection with this Agreement.
“Loans” means the collective reference to the Revolving Credit Loans and “Loan” means any of
such Loans.
“London Banking Day” means any day on which dealings in Dollar deposits are conducted by
and between banks in the London interbank Eurodollar market.
“Material Adverse Effect” means, with respect to the Borrower and its Subsidiaries, (a) a material
adverse effect on the operations, business, assets, properties, liabilities (actual or contingent) or financial
condition of such Persons, taken as a whole, (b) a material impairment of the ability of any such Person to
perform its payment obligations under the Loan Documents to which it is a party, (c) a material
impairment of the rights and remedies, taken as a whole, of the Lender under any Loan Document or (d) a
material impairment of the legality, validity, binding effect or enforceability against any Credit Party of
any Loan Document to which it is a party.
“Material Subsidiary” means each Subsidiary of the Borrower that is not an Immaterial
Subsidiary.
“Medicaid” means, collectively, the healthcare assistance program established by Title XIX of the
Social Security Act (42 U.S.C. §§ 1396 et seq.) and any statutes succeeding thereto, and all laws, rules
and regulations having the force of law and pertaining to such program, including all state statutes and
plans for medical assistance enacted in connection with such program, in each case as the same may be
amended, supplemented or otherwise modified from time to time.
“Medicare” means, collectively, the health insurance program for the aged and disabled
established by Title XVIII of the Social Security Act (42 U.S.C. §§ 1395 et seq.) and any statutes
succeeding thereto, and all laws, rules and regulations having the force of law and pertaining to such
program, in each case as the same may be amended, supplemented or otherwise modified from time to
time.
“Minimum Collateral Amount” means, at any time, (a) with respect to Cash Collateral consisting
of cash or deposit account balances provided in accordance with the provisions of Section 10.2(b), an
amount equal to 105% of the Outstanding Amount of all L/C Obligations and (b) otherwise, an amount
determined by the Lender at the time the Lender is entitled to Cash Collateral hereunder in its sole
discretion.
“Moody’s” means Moody’s Investors Service, Inc.
“Multiemployer Plan” means a “multiemployer plan” as defined in Section 4001(a)(3) of ERISA
to which any Credit Party or any ERISA Affiliate is making, or is accruing an obligation to make, or has
accrued an obligation to make, contributions within the preceding seven (7) years.
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“Non-Guarantor Subsidiary” means any Subsidiary of the Borrower that is not a Subsidiary
Guarantor.
“Notice of Account Designation” has the meaning assigned thereto in Section 2.3(b).
“Notice of Borrowing” has the meaning assigned thereto in Section 2.3(a).
“Notice of Conversion/Continuation” has the meaning assigned thereto in Section 5.2.
“Notice of Prepayment” has the meaning assigned thereto in Section 2.4(c).
“Obligations” means, in each case, whether now in existence or hereafter arising: (a) the principal
of and interest on (including interest accruing after the filing of any bankruptcy or similar petition) the
Loans, (b) the L/C Obligations, (c) all other fees and commissions (including attorneys’ fees), charges,
indebtedness, loans, liabilities, financial accommodations, obligations, covenants and duties owing by the
Credit Parties to the Lender, in each case under any Loan Document, with respect to any Loan or Letter of
Credit of every kind, nature and description, direct or indirect, absolute or contingent, due or to become
due, contractual or tortious, liquidated or unliquidated, and whether or not evidenced by any note and
including interest and fees that accrue after the commencement by or against any Credit Party of any
proceeding under any Debtor Relief Laws, naming such Person as the debtor in such proceeding,
regardless of whether such interest and fees are allowed claims in such proceeding, (d) all obligations
under any Hedge Agreement between any Credit Party or any Subsidiary and the Lender or Affiliate of
the Lender that is permitted to be incurred pursuant to Section 9.1(b) and (e) all obligations under any
Cash Management Agreement between any Credit Party or any Subsidiary and the Lender or Affiliate of
the Lender. The term “Obligations” shall not include any Excluded Swap Obligation.
“OFAC” means the U.S. Department of the Treasury’s Office of Foreign Assets Control.
“Officer’s Compliance Certificate” means a certificate of the chief financial officer or the
treasurer of the Borrower substantially in the form attached as Exhibit F.
“Operating Lease” means, as to any Person as determined in accordance with GAAP, any lease of
Property (whether real, personal or mixed) by such Person as lessee which is not a capital lease.
“Other Connection Taxes” means, Taxes imposed as a result of a present or former connection
between the Lender and the jurisdiction imposing such Tax (other than connections arising from the
Lender having executed, delivered, become a party to, performed its obligations under, received payments
under, received or perfected a security interest under, engaged in any other transaction pursuant to or
enforced any Loan Document, or sold or assigned an interest in any Loan or Loan Document).
“Other Taxes” means all present or future stamp, court, documentary, intangible, recording, filing
or similar Taxes that arise from any payment made under, from the execution, delivery, performance,
enforcement or registration of, from the receipt or perfection of a security interest under, or otherwise
with respect to, any Loan Document, except any such Taxes that are Other Connection Taxes imposed
with respect to an assignment.
“PATRIOT Act” means the USA PATRIOT Act (Title III of Pub. L. 107-56 (signed into law
October 26, 2001)).
“PBGC” means the Pension Benefit Guaranty Corporation or any successor agency.
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“Pension Plan” means any Employee Benefit Plan, other than a Multiemployer Plan, which is
subject to the provisions of Title IV of ERISA or Section 412 of the Code and which (a) is maintained,
funded or administered for the employees of any Credit Party or any ERISA Affiliate or (b) has at any
time within the preceding seven (7) years been maintained, funded or administered for the employees of
any Credit Party or any current or former ERISA Affiliates.
“Permits” means, with respect to any Person, any permit, approval, clearance, authorization,
license, registration, certificate, concession, grant, franchise, variance or permission from, and any other
contractual obligations 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 Products or to which such
Person or any of its property or Products is subject, including without limitation all Registrations.
“Permitted Acquisition” means any Acquisition that meets all of the following requirements:
(a) no less than ten (10) Business Days prior to the proposed closing date of such Acquisition
(or such shorter period as may be agreed to by the Lender), the Borrower shall have delivered written
notice of such Acquisition to the Lender, which notice shall include the proposed closing date of such
Acquisition; provided that no such notice shall be required for any Acquisition of a distributor so long as
the Permitted Acquisition Consideration for any such Acquisition does not exceed $15,000,000;
(b) the board of directors or other similar governing body of the Person to be acquired shall
have approved such Acquisition (and, if requested, the Lender shall have received evidence, in form and
substance reasonably satisfactory to the Lender, of such approval);
(c) the Person or business to be acquired shall be in a line of business permitted pursuant to
Section 9.11 or, in the case of an Acquisition of assets, the assets acquired are useful in the business of the
Borrower and its Subsidiaries as conducted immediately prior to such Acquisition;
(d) if such Acquisition is a merger or consolidation in which the Borrower or a Subsidiary
Guarantor is a constituent party, (i) the Borrower shall be the surviving Person in any such merger or
consolidation if the Borrower is a constituent party or a Subsidiary Guarantor (or a Person who shall
become a Subsidiary Guarantor within the applicable time period specified in Section 8.14) shall be the
surviving Person in any such merger or consolidation if a Subsidiary Guarantor is a constituent party and
(ii) no Change in Control shall have been effected thereby;
(e) if the Permitted Acquisition Consideration for any such Acquisition (or series of related
Acquisitions) exceeds $100,000,000 in the aggregate, no later than five (5) Business Days prior to the
proposed closing date of such Acquisition (or such shorter period as may be agreed to by the Lender), the
Borrower shall have delivered to the Lender an Officer’s Compliance Certificate for the most recent fiscal
quarter end preceding such Acquisition for which financial statements are available demonstrating, in
form and substance reasonably satisfactory to the Lender, that the Borrower is in compliance on a Pro
Forma Basis (as of the last day of such fiscal quarter) with each covenant contained in Section 9.15; and
(f) no Default or Event of Default shall have occurred and be continuing both before and
immediately after giving effect to such Acquisition.
“Permitted Acquisition Consideration” means the aggregate amount of the purchase price,
including, but not limited to, any assumed debt, earn-outs and Holdbacks (valued at the maximum amount
payable thereunder), deferred payments, or Equity Interests of the Borrower, to be paid on a singular basis
in connection with any applicable Permitted Acquisition as set forth in the applicable Permitted
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Acquisition Documents executed by the Borrower or any of its Subsidiaries in order to consummate the
applicable Permitted Acquisition.
“Permitted Call Spread Agreement” means (a) an agreement (including, but not limited to, any
convertible bond hedge or capped call transaction) pursuant to which, among other things, the Borrower
acquires an option requiring the counterparty thereto to deliver to the Borrower shares of common stock
of the Borrower, cash in lieu of delivering shares of common stock or cash representing the termination
value of such option or a combination thereof from time to time upon settlement, exercise or early
termination of such option (each a “Bond Hedge Transaction”) and (b) an agreement pursuant to which,
among other things, the Borrower issues to the counterparty thereto warrants to acquire shares of common
stock of the Borrower, cash in lieu of delivering shares of common stock or cash representing the
termination value of such warrants or a combination thereof from time to time upon settlement, exercise
or early termination of such warrants, in each case entered into by the Borrower in connection with the
issuance of any Convertible Debt Securities (including, without limitation, the exercise of any over-
allotment or underwriter’s option) (each a “Warrant Transaction”); provided that the purchase price for
such Bond Hedge Transaction, less the proceeds received by the Borrower from the sale of any related
Warrant Transaction, does not exceed the net proceeds received by the Borrower from the issuance of the
related Convertible Debt Securities.
“Permitted Liens” means the Liens permitted pursuant to Section 9.2.
“Person” means any natural person, corporation, limited liability company, trust, joint venture,
association, company, partnership, Governmental Authority or other entity.
“Prime Rate” means, at any time, the rate of interest per annum publicly announced from time to
time by the Lender as its prime rate. Each change in the Prime Rate shall be effective as of the opening of
business on the day such change in such prime rate occurs. The parties hereto acknowledge that the rate
announced publicly by the Lender as its prime rate is an index or base rate and shall not necessarily be its
lowest or best rate charged to its customers or other banks.
“Pro Forma Basis” means, for purposes of calculating the Consolidated Leverage Ratio and the
Consolidated Interest Coverage Ratio for any period during which one or more Specified Transactions
occurs, that such Specified Transaction (and all other Specified Transactions that have been consummated
during the applicable period) shall be deemed to have occurred as of the first day of the applicable period
of measurement and:
(a) all income statement items (whether positive or negative) attributable to the Property or
Person disposed of in a Specified Disposition shall be excluded and all income statement items (whether
positive or negative) attributable to the Property or Person acquired in a Permitted Acquisition shall be
included (provided that such income statement items to be included are reflected in financial statements
or other financial data reasonably acceptable to the Lender and based upon reasonable assumptions and
calculations which are expected to have a continuous impact); and
(b) in the event that any Credit Party or any Subsidiary thereof incurs (including by
assumption or guarantees) or repays (including by redemption, repayment, retirement, discharge,
defeasance or extinguishment) any Indebtedness included in the calculations of any financial ratio or test
(in each case, other than Indebtedness incurred or repaid under any revolving credit facility in the
ordinary course of business for working capital purposes), (i) during the applicable measurement period
or (ii) subsequent to the end of the applicable measurement period and prior to or simultaneously with the
event for which the calculation of any such ratio is made, then such financial ratio or test shall be
calculated giving pro forma effect to such incurrence or repayment of Indebtedness, to the extent
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required, as if the same had occurred on the last day of the applicable measurement period and any such
Indebtedness that is incurred (including by assumption or guarantee) that has a floating or formula rate of
interest shall have an implied rate of interest for the applicable period determined by utilizing the rate
which is or would be in effect with respect to such Indebtedness as of the relevant date of determination.
“Products” means any item or any service that is designed, created, tested, manufactured,
distributed, or otherwise offered by or on behalf of the Credit Parties or any of their Subsidiaries.
“Property” means any right or interest in or to property of any kind whatsoever, whether real,
personal or mixed and whether tangible or intangible, including, without limitation, Equity Interests.
“Public Health Laws” means all Applicable Laws relating to the procurement, development,
clinical and non-clinical evaluation, approval or clearance, manufacture, production, analysis,
distribution, dispensing, importation, exportation, handling, quality, sale, advertising or promotion of any
medical device or combination product (including, without limitation, any component of the foregoing
products) subject to regulation under the Federal Food, Drug, and Cosmetic Act (21 U.S.C. § 301 et seq.),
its implementing regulations, and similar state laws, pharmacy laws, or consumer product safety laws.
“Qualified Equity Interests” means any Equity Interests that are not Disqualified Equity Interests.
“Registrations” means all applicable Permits and exemptions issued or allowed by any
Governmental Authority (including but not limited to device pre-market approval applications, device
pre-market notifications, investigational device exemptions, product recertifications, manufacturing
approvals and authorizations, CE Marks, pricing and reimbursement approvals, labeling approvals or their
foreign equivalent, and wholesale distributor permits) held by, or applied by contract to, any Credit Party
or any of its Subsidiaries, that are required for the research, development, manufacture, distribution,
marketing, storage, transportation, use and sale of the Products of any Credit Party or any of its
Subsidiaries.
“Regulated Information” means information regulated under HIPAA or Other Privacy Laws.
“Regulatory Matters” means, collectively, activities and Products that are subject to Public Health
Laws.
“Reimbursement Obligation” means the obligation of the Borrower to reimburse the Lender
pursuant to Section 3.5 for amounts drawn under Letters of Credit issued by the Lender.
“Reinstated Letter of Credit” has the meaning assigned thereto in Section 3.11(e).
“Related Parties” means, with respect to any Person, such Person’s Affiliates and the partners,
directors, officers, employees, agents, trustees, administrators, managers, advisors and representatives of
such Person and of such Person’s Affiliates.
“Replacement Rate” has the meaning assigned thereto in Section 5.8(c).
“Responsible Officer” means, as to any Person, the chief executive officer, president, chief
financial officer, controller, treasurer or assistant treasurer of such Person or any other officer of such
Person designated in writing by the Borrower and reasonably acceptable to the Lender; provided that, to
the extent requested thereby, the Lender shall have received a certificate of such Person certifying as to
the incumbency and genuineness of the signature of each such officer. Any document delivered
hereunder or under any other Loan Document that is signed by a Responsible Officer of a Person shall be
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conclusively presumed to have been authorized by all necessary corporate, limited liability company,
partnership and/or other action on the part of such Person and such Responsible Officer shall be
conclusively presumed to have acted on behalf of such Person.
“Restricted Payment” means any dividend on, or the making of any payment or other distribution
on account of, or the purchase, redemption, retirement or other acquisition (directly or indirectly) of, or
the setting apart assets for a sinking or other analogous fund for the purchase, redemption, retirement or
other acquisition of, any class of Equity Interests of any Credit Party or any Subsidiary thereof, or the
making of any distribution of cash, property or assets to the holders of any Equity Interests of any Credit
Party or any Subsidiary thereof on account of such Equity Interests.
“Revolving Credit Commitment” means the obligation of the Lender to make Revolving Credit
Loans to the Borrower hereunder in an aggregate principal amount at any time outstanding not to exceed
$200,000,000.
“Revolving Credit Facility” means the revolving credit facility established pursuant to Article II.
“Revolving Credit Loan” means any revolving loan made to the Borrower pursuant to
Section 2.1, and all such revolving loans collectively as the context requires.
“Revolving Credit Maturity Date” means the earliest to occur of (a) February 27, 2021 (as such
date may be extended by the Lender pursuant to Section 2.7 hereof), (b) the date of termination of the
entire Revolving Credit Commitment by the Borrower pursuant to Section 2.5, and (c) the date of
termination of the Revolving Credit Commitment pursuant to Section 10.2(a).
“Revolving Credit Note” means the promissory note made by the Borrower in favor of the Lender
evidencing the Revolving Credit Loans made by the Lender, substantially in the form attached as Exhibit
A, and any substitutes therefor, and any replacements, restatements, renewals or extension thereof, in
whole or in part.
“Revolving Credit Outstandings” means the sum of (a) with respect to Revolving Credit Loans on
any date, the aggregate outstanding principal amount thereof after giving effect to any borrowings and
prepayments or repayments of Revolving Credit Loans occurring on such date; plus (b) with respect to
any L/C Obligations on any date, the aggregate outstanding amount thereof on such date after giving
effect to any Extensions of Credit occurring on such date and any other changes in the aggregate amount
of the L/C Obligations as of such date, including as a result of any reimbursements of outstanding unpaid
drawings under any Letters of Credit or any reductions in the maximum amount available for drawing
under Letters of Credit taking effect on such date.
“S&P” means Standard & Poor’s Financial Services LLC, a part of McGraw-Hill Financial and
any successor thereto.
“Sanctions” means any and all applicable economic or financial sanctions, sectoral sanctions,
secondary sanctions, trade embargoes and anti-terrorism laws, including but not limited to those imposed,
administered or enforced from time to time by the U.S. government (including those administered by
OFAC or the U.S. Department of State), the United Nations Security Council, the European Union, Her
Majesty’s Treasury, or other relevant sanctions authority with jurisdiction over the Lender, the Borrower
or any of its Subsidiaries or Affiliates.
“Sanctioned Country” means at any time, a country or territory which is itself the subject or target
of any Sanctions (including, as of the Closing Date, Cuba, Iran, North Korea, Sudan, Syria and Crimea).
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“Sanctioned Person” means, at any time, (a) any Person listed in any Sanctions-related list of
designated Persons maintained by OFAC (including, without limitation, OFAC’s Specially Designated
Nationals and Blocked Persons List and OFAC’s Consolidated Non-SDN List), the U.S. Department of
State, the United Nations Security Council, the European Union, Her Majesty’s Treasury, or other
relevant sanctions authority, (b) any Person operating, organized or resident in a Sanctioned Country or
(c) any Person owned or controlled by any such Person or Persons described in clauses (a) and (b),
including a Person that is deemed by OFAC to be a Sanctions target based on the ownership of such legal
entity by Sanctioned Peron(s).
“SEC” means the U.S. Securities and Exchange Commission, or any Governmental Authority
succeeding to any of its principal functions.
“Securities Act” means the Securities Act of 1933 (15 U.S.C. § 77 et seq.).
“Solvent” and “Solvency” mean, with respect to any Person on any date of determination, that on
such date (a) the fair value of the property of such Person is greater than the total amount of liabilities,
including contingent liabilities, of such Person, (b) the present fair salable value of the assets of such
Person is not less than the amount that will be required to pay the probable liability of such Person on its
debts as they become absolute and matured, (c) such Person does not intend to, and does not believe that
it will, incur debts or liabilities beyond such Person’s ability to pay such debts and liabilities as they
mature, (d) such Person is not engaged in business or a transaction, and is not about to engage in business
or a transaction, for which such Person’s property would constitute an unreasonably small capital, and
(e) such Person is able to pay its debts and liabilities, contingent obligations and other commitments as
they mature in the ordinary course of business. The amount of contingent liabilities at any time shall be
computed as the amount that, in the 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.
“Specified Disposition” means any Asset Disposition having gross sales proceeds in excess of the
Threshold Amount.
“Specified Transactions” means (a) any Specified Disposition and (b) any Permitted Acquisition.
“Subsidiary” means as to any Person, any corporation, partnership, limited liability company or
other entity of which more than fifty percent (50%) of the outstanding Equity Interests having ordinary
voting power to elect a majority of the board of directors (or equivalent governing body) or other
managers of such corporation, partnership, limited liability company or other entity is at the time owned
by (directly or indirectly) or the management is otherwise controlled by (directly or indirectly) such
Person (irrespective of whether, at the time, Equity Interests of any other class or classes of such
corporation, partnership, limited liability company or other entity shall have or might have voting power
by reason of the happening of any contingency). Unless otherwise qualified, references to “Subsidiary”
or “Subsidiaries” herein shall refer to those of the Borrower.
“Subsidiary Guarantors” means, collectively, all direct and indirect Subsidiaries of the Borrower
(other than any Immaterial Subsidiary, any Foreign Subsidiary and any Foreign Subsidiary Holding
Company) in existence on the Closing Date or which become a party to the Guaranty Agreement pursuant
to Section 8.14.
“Swap Obligation” means, with respect to any Credit Party, any obligation to pay or perform
under any agreement, contract or transaction that constitutes a “swap” within the meaning of section
1a(47) of the Commodity Exchange Act.
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“Synthetic Lease” means any synthetic lease, tax retention operating lease, off-balance sheet loan
or similar off-balance sheet financing product where such transaction is considered borrowed money
indebtedness for tax purposes but is classified as an Operating Lease in accordance with GAAP.
“Taxes” means all present or future taxes, levies, imposts, duties, deductions, withholdings
(including backup withholding), assessments, fees or other charges imposed by any Governmental
Authority, including any interest, fines, additions to tax or penalties applicable thereto.
“Termination Event” means the occurrence of any of the following which, individually or in the
aggregate, has resulted or could reasonably be expected to result in liability of any Credit Party in an
aggregate amount in excess of the Threshold Amount: (a) a “Reportable Event” described in Section 4043
of ERISA for which the thirty (30) day notice requirement has not been waived by the PBGC, or (b) the
withdrawal of any Credit Party or any ERISA Affiliate from a Pension Plan during a plan year in which it
was a “substantial employer” as defined in Section 4001(a)(2) of ERISA or a cessation of operations that
is treated as such a withdrawal under Section 4062(e) of ERISA, or (c) the termination of a Pension Plan,
the filing of a notice of intent to terminate a Pension Plan or the treatment of a Pension Plan amendment
as a termination, under Section 4041 of ERISA, if the plan assets are not sufficient to pay all plan
liabilities, or (d) the institution of proceedings to terminate, or the appointment of a trustee with respect
to, any Pension Plan by the PBGC, or (e) any other event or condition which would constitute grounds
under Section 4042(a) of ERISA for the termination of, or the appointment of a trustee to administer, any
Pension Plan, or (f) the imposition of a Lien pursuant to Section 430(k) of the Code or Section 303 of
ERISA, or (g) the determination that any Pension Plan or Multiemployer Plan is considered an at-risk
plan or plan in endangered or critical status with the meaning of Sections 430, 431 or 432 of the Code or
Sections 303, 304 or 305 of ERISA or (h) the partial or complete withdrawal of any Credit Party or any
ERISA Affiliate from a Multiemployer Plan if withdrawal liability is asserted by such plan, or (i) any
event or condition which results in the reorganization or insolvency of a Multiemployer Plan under
Sections 4241 or 4245 of ERISA, or (j) any event or condition which results in the termination of a
Multiemployer Plan under Section 4041A of ERISA or the institution by PBGC of proceedings to
terminate a Multiemployer Plan under Section 4042 of ERISA, or (k) the imposition of any liability under
Title IV of ERISA, other than for PBGC premiums due but not delinquent under Section 4007 of ERISA,
upon any Credit Party or any ERISA Affiliate.
“Threshold Amount” means $35,000,000.
“Transaction Costs” means all transaction fees, charges and other amounts related to any
Permitted Acquisitions consummated after the Closing Date (including, without limitation, any financing
fees, merger and acquisition fees, legal fees and expenses, due diligence fees or any other fees and
expenses in connection therewith), in each case to the extent paid within twelve (12) months of such
Permitted Acquisition.
“TRICARE” means, collectively, the program of medical benefits covering former and active
members of the uniformed services and certain of their dependents, financed and administered by the
United States Department of Defense, Health and Human Services and Transportation, and all laws, rules
and regulations having the force of law and pertaining to such program, in each case as the same may be
amended, supplemented or otherwise modified from time to time.
“UCC” means the Uniform Commercial Code as in effect in the State of New York.
“United States” means the United States of America.
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“Weighted Average Life to Maturity” means, when applied to any Indebtedness at any date, the
number of years obtained by dividing: (a) the sum of the products obtained by multiplying (i) the amount
of each then remaining installment, sinking fund, serial maturity or other required payments of principal,
including payment at final maturity, in respect thereof, by (ii) the number of years (calculated to the
nearest one-twelfth) that will elapse between such date and the making of such payment; by (b) the then
outstanding principal amount of such Indebtedness, in each case of clauses (a) and (b), without giving
effect to the application of any prior prepayment to such installment, sinking fund, serial maturity or other
required payment of principal.
“Wells Fargo” means Wells Fargo Bank, National Association, a national banking association.
“Wholly-Owned” means, with respect to a Subsidiary, that all of the Equity Interests of such
Subsidiary are, directly or indirectly, owned or controlled by the Borrower and/or one or more of its
Wholly-Owned Subsidiaries (except for directors’ qualifying shares or other shares required by
Applicable Law to be owned by a Person other than the Borrower and/or one or more of its Wholly-
Owned Subsidiaries).
“Withholding Agent” means the Borrower and the Lender.
“Write-Down and Conversion Powers” means, with respect to any EEA Resolution Authority, the
write-down and conversion powers of such EEA Resolution Authority from time to time under the Bail-In
Legislation for the applicable EEA Member Country, which write-down and conversion powers are
described in the EU Bail-In Legislation Schedule.
SECTION 1.2 Other Definitions and Provisions. With reference to this Agreement and
each other Loan Document, unless otherwise specified herein or in such other Loan Document: (a) the
definitions of terms herein shall apply equally to the singular and plural forms of the terms defined,
(b) whenever the context may require, any pronoun shall include the corresponding masculine, feminine
and neuter forms, (c) the words “include”, “includes” and “including” shall be deemed to be followed
by the phrase “without limitation”, (d) the word “will” shall be construed to have the same meaning and
effect as the word “shall”, (e) any reference herein to any Person shall be construed to include such
Person’s successors and assigns, (f) 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, (g) all references herein to Articles, Sections, Exhibits and Schedules shall be construed to refer
to Articles and Sections of, and Exhibits and Schedules to, this Agreement, (h) 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, (i) the term
“documents” includes any and all instruments, documents, agreements, certificates, notices, reports,
financial statements and other writings, however evidenced, whether in physical or electronic form and
(j) in the computation of periods of time from a specified date to a later specified date, the word “from”
means “from and including;” the words “to” and “until” each mean “to but excluding;” and the word
“through” means “to and including”.
SECTION 1.3 Accounting Terms.
(a) All accounting terms not specifically or completely defined herein shall be construed in
conformity with, and all financial data (including financial ratios and other financial calculations)
required to be submitted pursuant to this Agreement shall be prepared in conformity with GAAP, applied
on a consistent basis, as in effect from time to time and in a manner consistent with that used in preparing
the audited financial statements required by Section 8.1(a), except as otherwise specifically prescribed
herein. Notwithstanding the foregoing, for purposes of determining compliance with any covenant
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(including the computation of any financial covenant) contained herein, (i) Indebtedness of the Borrower
and its Subsidiaries shall be deemed to be carried at 100% of the outstanding principal amount thereof,
and the effects of FASB ASC 825 and FASB ASC 470-20 on financial liabilities shall be disregarded and
(ii) whenever it is necessary under this Agreement to determine whether any lease obligations constitute
Capital Lease Obligations or Operating Lease obligations, any lease that would be treated as an Operating
Lease under GAAP (FASB ASC 840) as of the Closing Date (whether such lease is entered into before or
after the Closing Date) shall be treated as an Operating Lease for all purposes under the Loan Documents,
notwithstanding the implementation of any changes in GAAP after the Closing Date.
(b) If at any time any change in GAAP would affect the computation of any financial ratio or
requirement set forth in any Loan Document, and either the Borrower or the Lender shall so request, the
Lender and the Borrower shall negotiate in good faith to amend such ratio or requirement to preserve the
original intent thereof in light of such change in GAAP; provided that, until so amended, (i) such ratio or
requirement shall continue to be computed in accordance with GAAP prior to such change therein and
(ii) the Borrower shall provide to the Lender financial statements and other documents required under this
Agreement or as reasonably requested hereunder setting forth a reconciliation between calculations of
such ratio or requirement made before and after giving effect to such change in GAAP. Notwithstanding
anything in this Agreement, whenever it is necessary under this Agreement to determine whether any
lease obligations constitute Capital Lease Obligations or Operating Lease obligations, any lease that
would be treated as an Operating Lease under GAAP (FASB ASC 840) as of the Closing Date (whether
such lease is entered into before or after the Closing Date) shall be treated as an Operating Lease for all
purposes under the Loan Documents, notwithstanding the implementation of any changes in GAAP after
the Closing Date.
SECTION 1.4 UCC Terms. Terms defined in the UCC in effect on the Closing Date and
not otherwise defined herein shall, unless the context otherwise indicates, have the meanings provided
by those definitions. Subject to the foregoing, the term “UCC” refers, as of any date of determination,
to the UCC then in effect.
SECTION 1.5 Rounding. Any financial ratios required to be maintained pursuant to this
Agreement shall be calculated by dividing the appropriate component by the other component, carrying
the result to one place more than the number of places by which such ratio or percentage is expressed
herein and rounding the result up or down to the nearest number (with a rounding-up if there is no
nearest number).
SECTION 1.6 References to Agreement and Laws. Unless otherwise expressly provided
herein, (a) any definition or reference to formation documents, governing documents, agreements
(including the Loan Documents) and other contractual documents or instruments shall be deemed to
include all subsequent amendments, restatements, extensions, supplements and other modifications
thereto, but only to the extent that such amendments, restatements, extensions, supplements and other
modifications are not prohibited by any Loan Document; and (b) any definition or reference to any
Applicable Law, including, without limitation, Anti-Corruption Laws, Anti-Money Laundering Laws,
the Bankruptcy Code, the Code, the Commodity Exchange Act, ERISA, the Exchange Act, the
PATRIOT Act, the Securities Act, the UCC, the Investment Company Act, Health Care Laws, HIPAA
and Other Privacy Laws, the Government Reimbursement Program, the Interstate Commerce Act, the
Trading with the Enemy Act of the United States or any of the foreign assets control regulations of the
United States Treasury Department, shall include all statutory and regulatory provisions consolidating,
amending, replacing, supplementing or interpreting such Applicable Law.
SECTION 1.7 Times of Day. Unless otherwise specified, all references herein to times of
day shall be references to Eastern time (daylight or standard, as applicable).
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SECTION 1.8 Letter of Credit Amounts. Unless otherwise specified, all references herein
to the amount of a Letter of Credit at any time shall be deemed to mean the maximum face amount of
such Letter of Credit after giving effect to all increases thereof contemplated by such Letter of Credit or
the Letter of Credit Application therefor (at the time specified therefor in such applicable Letter of
Credit or Letter of Credit Application), as such amount may be reduced by (a) any permanent reduction
of such Letter of Credit or (b) any amount which is drawn, reimbursed and no longer available under
such Letter of Credit.
SECTION 1.9 Guarantees/Earn-Outs. Unless otherwise specified, (a) the amount of any
Guarantee shall be the lesser of the amount of the obligations guaranteed and still outstanding and the
maximum amount for which the guaranteeing Person may be liable pursuant to the terms of the
instrument embodying such Guarantee and (b) the amount of any earn-out or similar obligation or
Holdback shall be the amount of such obligation as reflected on the balance sheet of such Person in
accordance with GAAP.
SECTION 1.10 Covenant Compliance Generally. For purposes of determining compliance
under Sections 9.1, 9.2, 9.3, 9.5, 9.6 and 9.15, as of the date of the applicable transaction or calculation,
any amount in a currency other than Dollars will be converted to Dollars in a manner consistent with
that used in calculating Consolidated Net Income in the most recent annual financial statements of the
Borrower and its Subsidiaries delivered pursuant to Section 6.1(d)(i) or Section 8.1(a).
Notwithstanding the foregoing, for purposes of determining compliance with Sections 9.1, 9.2, 9.3 and
9.15, with respect to any amount of Indebtedness or Investment in a currency other than Dollars, no
breach of any basket or financial covenant contained in such sections shall be deemed to have occurred
solely as a result of changes in rates of exchange occurring after the time such Indebtedness or
Investment is incurred; provided that for the avoidance of doubt, the foregoing provisions of this
Section 1.10 shall otherwise apply to such Sections, including with respect to determining whether any
Indebtedness or Investment may be incurred at any time under such Sections.
SECTION 1.11 Rates. The Lender does not warrant or accept responsibility for, and shall
not have any liability with respect to, the administration, submission or any other matter related to the
rates in the definition of “LIBOR”.
ARTICLE II
REVOLVING CREDIT FACILITY
SECTION 2.1 Revolving Credit Loans. Subject to the terms and conditions of this
Agreement and the other Loan Documents, and in reliance upon the representations and warranties set
forth in this Agreement and the other Loan Documents, the Lender agrees to make Revolving Credit
Loans in Dollars to the Borrower from time to time from the Closing Date to, but not including, the
Revolving Credit Maturity Date as requested by the Borrower in accordance with the terms of
Section 2.3; provided, that the Revolving Credit Outstandings shall not exceed the Revolving Credit
Commitment. Subject to the terms and conditions hereof, the Borrower may borrow, repay and
reborrow Revolving Credit Loans hereunder until the Revolving Credit Maturity Date.
SECTION 2.2 [Reserved].
SECTION 2.3 Procedure for Advances of Revolving Credit Loans.
(a) Requests for Borrowing. The Borrower shall give the Lender irrevocable prior written
notice substantially in the form of Exhibit B (a “Notice of Borrowing”) not later than 12:00 p.m. (i) on
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the same Business Day as each Base Rate Loan and (ii) at least three (3) Business Days before each
LIBOR Rate Loan, of its intention to borrow, specifying (A) the date of such borrowing, which shall be a
Business Day, (B) the amount of such borrowing, which shall be, (x) with respect to Base Rate Loans in
an aggregate principal amount of $3,000,000 or a whole multiple of $1,000,000 in excess thereof and
(y) with respect to LIBOR Rate Loans in an aggregate principal amount of $5,000,000 or a whole
multiple of $1,000,000 in excess thereof, (C) whether the Loans are to be LIBOR Rate Loans or Base
Rate Loans, and (D) in the case of a LIBOR Rate Loan, the duration of the Interest Period applicable
thereto; provided that if the Borrower wishes to request LIBOR Rate Loans having an Interest Period of
twelve months in duration, such notice must be received by the Lender not later than 12:00 p.m. four (4)
Business Days prior to the requested date of such borrowing. If the Borrower fails to specify a type of
Loan in a Notice of Borrowing, then the applicable Loans shall be made as Base Rate Loans. If the
Borrower requests a borrowing of LIBOR Rate Loans in any such Notice of Borrowing, but fails to
specify an Interest Period, it will be deemed to have specified an Interest Period of one month. A Notice
of Borrowing received after 12:00 p.m. shall be deemed received on the next Business Day.
(b) Disbursement of Revolving Credit Loans. The Borrower hereby irrevocably authorizes
the Lender to disburse the proceeds of each borrowing requested pursuant to this Section in immediately
available funds by crediting or wiring such proceeds to the deposit account of the Borrower identified in
the most recent notice substantially in the form attached as Exhibit C (a “Notice of Account
Designation”) delivered by the Borrower to the Lender or as may be otherwise agreed upon by the
Borrower and the Lender from time to time.
SECTION 2.4 Repayment and Prepayment of Revolving Credit Loans.
(a) Repayment on Termination Date. The Borrower hereby agrees to repay the outstanding
principal amount of all Revolving Credit Loans in full on the Revolving Credit Maturity Date together
with all accrued but unpaid interest thereon.
(b) Mandatory Prepayments. If at any time the Revolving Credit Outstandings exceed the
Revolving Credit Commitment, the Borrower agrees to repay immediately upon notice from the Lender,
by payment to the Lender, Extensions of Credit in an amount equal to such excess with each such
repayment applied first, to the principal amount of outstanding Revolving Credit Loans and second, with
respect to any Letters of Credit then outstanding, a payment of Cash Collateral into a Cash Collateral
account opened by the Lender, in an amount equal to such excess (such Cash Collateral to be applied in
accordance with Section 10.2(b)).
(c) Optional Prepayments. The Borrower may at any time and from time to time prepay
Revolving Credit Loans, in whole or in part, without premium or penalty, with irrevocable prior written
notice to the Lender substantially in the form attached as Exhibit D (a “Notice of Prepayment”) given not
later than 12:00 p.m. (i) on the same Business Day as each Base Rate Loan and (ii) at least three (3)
Business Days before each LIBOR Rate Loan, specifying the date and amount of prepayment and
whether the prepayment is of LIBOR Rate Loans, Base Rate Loans or a combination thereof, and, if of a
combination thereof, the amount allocable to each. If any such notice is given, the amount specified in
such notice shall be due and payable on the date set forth in such notice. Partial prepayments shall be in
an aggregate amount of $3,000,000 or a whole multiple of $1,000,000 in excess thereof with respect to
Base Rate Loans, $5,000,000 or a whole multiple of $1,000,000 in excess thereof with respect to LIBOR
Rate Loans. A Notice of Prepayment received after 12:00 p.m. shall be deemed received on the next
Business Day. Each such repayment shall be accompanied by any amount required to be paid pursuant to
Section 5.9 hereof. Notwithstanding the foregoing, any Notice of a Prepayment delivered in connection
with any refinancing of all of the Revolving Credit Facility with the proceeds of such refinancing or of
any incurrence of Indebtedness or the occurrence of some other identifiable event or condition, may be, if
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expressly so stated to be, contingent upon the consummation of such refinancing or incurrence or
occurrence of such other identifiable event or condition and may be revoked by the Borrower in the event
such contingency is not met (provided that the failure of such contingency shall not relieve the Borrower
from its obligations in respect thereof under Section 5.9).
(d) [Reserved].
(e) Limitation on Prepayment of LIBOR Rate Loans. The Borrower may not prepay any
LIBOR Rate Loan on any day other than on the last day of the Interest Period applicable thereto unless
such prepayment is accompanied by any amount required to be paid pursuant to Section 5.9 hereof (which
such amount the Lender has specified to the Borrower).
SECTION 2.5 Permanent Reduction of the Revolving Credit Commitment.
(a) Voluntary Reduction. The Borrower shall have the right at any time and from time to
time, upon at least three (3) Business Days prior irrevocable written notice to the Lender, to permanently
reduce, without premium or penalty, (i) the entire Revolving Credit Commitment at any time or
(ii) portions of the Revolving Credit Commitment, from time to time, in an aggregate principal amount
not less than $3,000,000 or any whole multiple of $1,000,000 in excess thereof. All Commitment Fees
accrued until the effective date of any termination of the Revolving Credit Commitment shall be paid on
the effective date of such termination. Notwithstanding the foregoing, any notice to reduce the Revolving
Credit Commitment delivered in connection with any refinancing of all of the Revolving Credit Facility
with the proceeds of such refinancing or of any incurrence of Indebtedness or the occurrence of some
other identifiable event or condition, may be, if expressly so stated to be, contingent upon the
consummation of such refinancing or incurrence or occurrence of such identifiable event or condition and
may be revoked by the Borrower in the event such contingency is not met (provided that the failure of
such contingency shall not relieve the Borrower from its obligations in respect thereof under Section 5.9).
(b) [Reserved].
(c) [Reserved].
(d) Corresponding Payment. Each permanent reduction permitted pursuant to this Section
shall be accompanied by a payment of principal sufficient to reduce the aggregate outstanding Revolving
Credit Loans and L/C Obligations, as applicable, after such reduction to the Revolving Credit
Commitment as so reduced, and if the aggregate amount of all outstanding Letters of Credit exceeds the
Revolving Credit Commitment as so reduced, the Borrower shall be required to deposit Cash Collateral in
a Cash Collateral account opened by the Lender in an amount equal to such excess. Such Cash Collateral
shall be applied in accordance with Section 10.2(b). Any reduction of the Revolving Credit Commitment
to zero shall be accompanied by payment of all outstanding Revolving Credit Loans (and furnishing of
Cash Collateral satisfactory to the Lender for all L/C Obligations) and shall result in the termination of
the Revolving Credit Commitment and the Revolving Credit Facility. If the reduction of the Revolving
Credit Commitment requires the repayment of any LIBOR Rate Loan, such repayment shall be
accompanied by any amount required to be paid pursuant to Section 5.9 hereof (which such amount the
Lender has specified to the Borrower).
SECTION 2.6 Termination of Revolving Credit Facility. The Revolving Credit Facility and
the Revolving Credit Commitments shall terminate on the Revolving Credit Maturity Date.
SECTION 2.7 Extension of Revolving Credit Maturity Date.
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(a) Requests for Extension. The Borrower may, by notice to the Lender not later than ninety
(90) days (or such shorter period as Lender may agree in its sole discretion) prior to the first, second
and/or third anniversary of the Closing Date (each, an “Extension Date”), request that the Lender
extend the Revolving Credit Maturity Date for an additional year from the Revolving Credit Maturity
Date then in effect hereunder (the “Existing Maturity Date”); provided that no more than two (2)
extensions under this Section 2.7 may be permitted.
(b) Election to Extend. Within fifteen (15) Business Days’ following the date notice is given
by the Borrower to the Lender pursuant to clause (a) above, the Lender shall notify the Borrower
whether or not the Lender agrees to such extension.
(c) Effect of Extension. To the extent the Lender has elected to extend the Existing Maturity
Date, the Revolving Credit Maturity Date shall be extended to the date falling one year after the
Existing Maturity Date (except that, if such date is not a Business Day, such Termination Date as so
extended shall be the next preceding Business Day).
(d) Conditions to Effectiveness of Extensions. Notwithstanding the foregoing, the extension
of the Revolving Credit Maturity Date pursuant to this Section 2.7 shall not be effective with respect to
the Lender unless (i) no Default or Event of Default exists on the Extension Date and after giving
effect to such extension and (ii) all representations and warranties of the Credit Parties contained in
this Agreement and the other Loan Documents are true and correct in all material respects (except to
the extent any such representation and warranty is qualified by materiality or reference to Material
Adverse Effect, in which case, such representation and warranty shall be true and correct in all
respects) on and as of the Extension Date (except to the extent any such representation or warranty
specifically refers to an earlier date, in which case, such representation and warranty shall be true and
correct in all material respects as of such earlier date (except to the extent any such representation and
warranty is qualified by materiality or reference to Material Adverse Effect, in which case, such
representation and warranty shall be true and correct in all respects as of such earlier date).
ARTICLE III
LETTER OF CREDIT FACILITY
SECTION 3.1 Letter of Credit Facility.
(a) Availability. Subject to the terms and conditions hereof, the Lender agrees to issue
standby Letters of Credit in an aggregate amount not to exceed its L/C Commitment for the account of the
Borrower or, subject to Section 3.10, any Subsidiary thereof, Letters of Credit may be issued on any
Business Day from the Closing Date to, but not including the thirtieth (30th) Business Day prior to the
Revolving Credit Maturity Date in such form as may be approved from time to time by the Lender;
provided, that the Lender shall not issue any Letter of Credit if, after giving effect to such issuance, (a) the
L/C Obligations would exceed the L/C Sublimit or (b) the Revolving Credit Outstandings would exceed
the Revolving Credit Commitment.
(b) Terms of Letters of Credit. Each Letter of Credit shall (i) be denominated in Dollars in a
minimum amount of $100,000 (or such lesser amount as agreed to by the Lender), (ii) expire on a date no
more than twelve (12) months after the date of issuance or last renewal of such Letter of Credit (subject to
automatic renewal for additional one (1) year periods (but not to a date later than the date set forth below)
pursuant to the terms of the Letter of Credit Application or other documentation acceptable to the
Lender), which date shall be no later than the fifth (5th) Business Day prior to the Revolving Credit
Maturity Date; provided that any Letter of Credit may expire after such date (each such Letter of Credit,
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an “Extended Letter of Credit”) with the consent of the Lender and subject to the requirements of Section
3.11, and (iii) be subject to ISP98 as set forth in the Letter of Credit Application or as determined by the
Lender and, to the extent not inconsistent therewith, the laws of the State of New York. The Lender shall
not at any time be obligated to issue any Letter of Credit hereunder if (A) any order, judgment or decree
of any Governmental Authority or arbitrator shall by its terms purport to enjoin or restrain the Lender
from issuing such Letter of Credit, or any Applicable Law applicable to the Lender or any request or
directive (whether or not having the force of law) from any Governmental Authority with jurisdiction
over the Lender shall prohibit, or request that the Lender refrain from, the issuance of letters of credit
generally or such Letter of Credit in particular or shall impose upon the Lender with respect to letters of
credit generally or such Letter of Credit in particular any restriction or reserve or capital requirement (for
which the Lender is not otherwise compensated) not in effect on the Closing Date, or any unreimbursed
loss, cost or expense that was not applicable, in effect or known to the Lender as of the Closing Date and
that the Lender in good faith deems material to it, (B) the conditions set forth in Section 6.2 are not
satisfied, (C) the issuance of such Letter of Credit would violate one or more policies of the Lender
applicable to letters of credit generally or (D) the beneficiary of such Letter of Credit is a Sanctioned
Person. References herein to “issue” and derivations thereof with respect to Letters of Credit shall also
include extensions or modifications of any outstanding Letters of Credit, unless the context otherwise
requires.
SECTION 3.2 Procedure for Issuance of Letters of Credit. The Borrower may from time to
time request that the Lender issue a Letter of Credit by delivering to the Lender at its applicable office a
Letter of Credit Application therefor, completed to the reasonable satisfaction of the Lender, and such
other certificates, documents and other papers and information as the Lender may reasonably request.
Upon receipt of any Letter of Credit Application, the Lender shall process such Letter of Credit
Application and the certificates, documents and other papers and information delivered to it in
connection therewith in accordance with its customary procedures and shall, subject to Section 3.1 and
Article VI, promptly issue the Letter of Credit requested thereby (but in no event shall the Lender be
required to issue any Letter of Credit earlier than three (3) Business Days after its receipt of the Letter
of Credit Application therefor and all such other certificates, documents and other papers and
information relating thereto) by issuing the original of such Letter of Credit to the beneficiary thereof or
as otherwise may be agreed by the Lender and the Borrower. The Lender shall promptly furnish to the
Borrower a copy of such Letter of Credit.
SECTION 3.3 Commissions and Other Charges.
(a) Letter of Credit Commissions. The Borrower shall pay to the Lender a letter of credit
commission with respect to each Letter of Credit in the amount equal to the daily amount available to be
drawn under such standby Letters of Credit times the Applicable Margin with respect to Revolving Credit
Loans that are LIBOR Rate Loans (determined, in each case, on a per annum basis). Such commission
shall be payable quarterly in arrears on the last Business Day of each calendar quarter, on the Revolving
Credit Maturity Date and thereafter on demand of the Lender.
(b) Other Fees, Costs, Charges and Expenses. In addition to the foregoing fees and
commissions, the Borrower shall pay or reimburse the Lender for such normal and customary fees, costs,
charges and expenses as are incurred or charged by the Lender in issuing, effecting payment under,
amending or otherwise administering any Letter of Credit issued by it.
SECTION 3.4 [Reserved].
SECTION 3.5 Reimbursement Obligation of the Borrower. In the event of any drawing
under any Letter of Credit, the Borrower agrees to reimburse (either with the proceeds of a Revolving
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Credit Loan as provided for in this Section or with funds from other sources), in same day funds, the
Lender on each date on which the Lender notifies the Borrower of the date and amount of a draft paid
by it under any Letter of Credit for the amount of (a) such draft so paid and (b) any amounts referred to
in Section 3.3(b) incurred by the Lender in connection with such payment. Unless the Borrower shall
immediately notify the Lender that the Borrower intends to reimburse the Lender for such drawing from
other sources or funds, the Borrower shall be deemed to have timely given a Notice of Borrowing to the
Lender requesting that the Lender make a Revolving Credit Loan as a Base Rate Loan on the applicable
repayment date in the amount of (i) such draft so paid and (ii) any amounts referred to in Section 3.3(b)
incurred by the Lender in connection with such payment, and the Lender shall make a Revolving Credit
Loan as a Base Rate Loan in such amount, the proceeds of which shall be applied to reimburse the
Lender for the amount of the related drawing and such fees and expenses. If the Borrower has elected
to pay the amount of such drawing with funds from other sources and shall fail to reimburse the Lender
as provided above, or if the amount of such drawing is not fully refunded through a Base Rate Loan as
provided above, the unreimbursed amount of such drawing shall bear interest at the rate which would
be payable on any outstanding Base Rate Loans which were then overdue from the date such amounts
become payable (whether at stated maturity, by acceleration or otherwise) until payment in full.
SECTION 3.6 Obligations Absolute. The Borrower’s obligations under this Article III
(including, without limitation, the Reimbursement Obligation) shall be absolute and unconditional
under any and all circumstances and irrespective of any setoff, counterclaim or defense to payment
which the Borrower may have or have had against the Lender or any beneficiary of a Letter of Credit or
any other Person. The Borrower also agrees that the Lender shall not be responsible for, and the
Borrower’s Reimbursement Obligation under Section 3.5 shall not be affected by, among other things,
the validity or genuineness of documents or of any endorsements thereon, even though such documents
shall in fact prove to be invalid, fraudulent or forged, or any dispute between or among the Borrower
and any beneficiary of any Letter of Credit or any other party to which such Letter of Credit may be
transferred or any claims whatsoever of the Borrower against any beneficiary of such Letter of Credit or
any such transferee. The Lender shall not be liable for any error, omission, interruption or delay in
transmission, dispatch or delivery of any message or advice, however transmitted, in connection with
any Letter of Credit issued by it, except for errors or omissions caused by the Lender’s gross negligence
or willful misconduct, as determined by a court of competent jurisdiction by final nonappealable
judgment. The Borrower agrees that any action taken or omitted by the Lender under or in connection
with any Letter of Credit issued by it or the related drafts or documents, if done in the absence of gross
negligence or willful misconduct shall be binding on the Borrower and shall not result in any liability of
the Lender to the Borrower. The responsibility of the Lender to the Borrower in connection with any
draft presented for payment under any Letter of Credit issued to it shall, in addition to any payment
obligation expressly provided for in such Letter of Credit, be limited to determining that the documents
(including each draft) delivered under such Letter of Credit in connection with such presentment
substantially conform to the requirements under such Letter of Credit.
SECTION 3.7 Effect of Letter of Credit Application. To the extent that any provision of
any Letter of Credit Application related to any Letter of Credit is inconsistent with the provisions of this
Article III, the provisions of this Article III shall apply.
SECTION 3.8 [Reserved].
SECTION 3.9 [Reserved].
SECTION 3.10 Letters of Credit Issued for Subsidiaries. Notwithstanding that a Letter of
Credit issued or outstanding hereunder is in support of any obligations of, or is for the account of, a
Subsidiary, the Borrower shall be obligated to reimburse, or to cause the applicable Subsidiary to
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reimburse, the Lender hereunder for any and all drawings under such Letter of Credit. The Borrower
hereby acknowledges that the issuance of Letters of Credit for the account of any of its Subsidiaries
inures to the benefit of the Borrower and that the Borrower’s business derives substantial benefits from
the businesses of such Subsidiaries.
SECTION 3.11 Cash Collateral for Extended Letters of Credit.
(a) Cash Collateralization. The Borrower shall provide Cash Collateral to the Lender with
respect to each Extended Letter of Credit issued by the Lender (in an amount equal to 105% of the
maximum face amount of each Extended Letter of Credit, calculated in accordance with Section 1.8) by a
date that is no later than 30 days (or such shorter period as Lender may agree to in its sole discretion)
prior to the Revolving Credit Maturity Date by depositing such amount in immediately available funds, in
Dollars, into a cash collateral account maintained at the Lender and shall enter into a cash collateral
agreement in form and substance reasonably satisfactory to the Lender and such other documentation as
the Lender may reasonably request; provided that if the Borrower fails to provide Cash Collateral with
respect to any such Extended Letter of Credit by such time, such event shall be treated as a drawing under
such Extended Letter of Credit in an amount equal to 105% of the maximum face amount of each such
Letter of Credit, calculated in accordance with Section 1.8, which shall be reimbursed (or participations
therein funded) in accordance with this Article III, with the proceeds of Revolving Credit Loans (or
funded participations) being utilized to provide Cash Collateral for such Letter of Credit (provided that
for purposes of determining the usage of the Revolving Credit Commitment any such Extended Letter of
Credit that has been, or will concurrently be, Cash Collateralized with proceeds of a Revolving Credit
Loan, the portion of such Extended Letter of Credit that has been (or will concurrently be) so Cash
Collateralized will not be deemed to be utilization of the Revolving Credit Commitment). After any such
Extended Letter of Credit shall have expired or been fully drawn upon, and any Reimbursement
Obligation in respect of such Extended Letter of Credit has been satisfied, the balance, if any, of the Cash
Collateral for such Extended Letter of Credit shall be returned promptly to the Borrower.
(b) Grant of Security Interest. The Borrower hereby grants to the Lender, and agrees to
maintain, a first priority security interest in, all Cash Collateral required to be provided by this Section
3.11 as security for the Lender’s obligation to fund draws under such Extended Letters of Credit, to be
applied pursuant to subsection (c) below. If at any time the Lender determines that the Cash Collateral is
subject to any right or claim of any Person other than the Lender as herein provided, or that the total
amount of such Cash Collateral is less than the amount required pursuant to subsection (a) above, the
Borrower will, promptly upon demand by the Lender, pay or provide to the Lender additional Cash
Collateral in an amount sufficient to eliminate such deficiency.
(c) Application. Notwithstanding anything to the contrary contained in any Loan Document,
Cash Collateral provided under this Section 3.11 in respect of Extended Letters of Credit shall be applied
to reimburse the Lender for all drawings made under such Extended Letters of Credit and any and all fees,
expenses and charges incurred in connection therewith, prior to any other application of such property as
may otherwise be provided for herein.
(d) Cash Collateralized Letters of Credit. Subject to clause (e) below, if the Borrower has
fully Cash Collateralized the Lender with respect to any Extended Letter of Credit issued by the Lender in
accordance with subsections (a) through (c) above and the Borrower and the Lender have made
arrangements between them with respect to the pricing and fees associated therewith (each such Extended
Letter of Credit, a “Cash Collateralized Letter of Credit”), then for so long as such Cash Collateral
remains in place (i) such Cash Collateralized Letter of Credit shall cease to be a “Letter of Credit”
hereunder, (ii) such Cash Collateralized Letter of Credit shall not constitute utilization of the Revolving
Credit Commitment, (iii) the Lender shall not have any further obligation to fund Revolving Credit Loans
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to reimburse any drawing under any such Cash Collateralized Letter of Credit, (iv) no Letter of Credit
commissions under Section 3.3(a) shall be due or payable to the Lender hereunder with respect to such
Cash Collateralized Letter of Credit, and (v) any fronting fee, issuance fee or other fee with respect to
such Cash Collateralized Letter of Credit shall be as agreed separately between the Borrower and the
Lender.
(e) Reinstatement. The Borrower and the Lender agree that if any payment or deposit made
by the Borrower or any other Person applied to the Cash Collateral required under this Section 3.11 is at
any time avoided, annulled, set aside, rescinded, invalidated, declared to be fraudulent or preferential or
otherwise required to be refunded or repaid, or is repaid in whole or in part pursuant to a good faith
settlement of a pending or threatened avoidance claim, or the proceeds of any such Cash Collateral are
required to be refunded by the Lender to the Borrower or its estate, trustee, receiver or any other Person,
under any Applicable Law or equitable cause, then, to the extent of such payment or repayment, (i) the
applicable Extended Letter of Credit shall automatically be a “Letter of Credit” hereunder in a face
amount equal to such payment or repayment (each such Letter of Credit, a “Reinstated Letter of Credit”),
(ii) such Reinstated Letter of Credit shall no longer be deemed to be Cash Collateralized hereunder and
shall constitute a utilization of the Revolving Credit Commitment, (iii) the Lender shall be obligated to
fund Revolving Credit Loans to reimburse any drawing under such Reinstated Letter of Credit, (iv) Letter
of Credit commissions under Section 3.3(a) shall accrue and be due and payable to the Lender with
respect to such Reinstated Letter of Credit from the date of such reinstatement and (v) the Borrower’s and
the Lender’s liability hereunder (and any Guaranty guaranteeing such liability) shall be and remain in full
force and effect, as fully as if such payment or deposit had never been made, and, if prior thereto, this
Agreement shall have been canceled, terminated, paid in full or otherwise extinguished (and if any
Guaranty guaranteeing the Borrower’s or the Lender’s) liability hereunder shall have been released or
terminated by virtue of such cancellation, termination, payment or extinguishment), the provisions of this
Article III and all other rights and duties of the Lender and the Credit Parties with respect to such
Reinstated Letter of Credit (and any Guaranty guaranteeing such liability) shall be reinstated in full force
and effect, and such prior cancellation, termination, payment or extinguishment shall not diminish,
release, discharge, impair or otherwise affect the obligations of such Persons in respect of such Reinstated
Letter of Credit (and any Guaranty guaranteeing such obligation).
(f) Survival. With respect to any Extended Letter of Credit, each party’s obligations under
this Article III and all other rights and duties of the Lender and the Credit Parties with respect to such
Extended Letter of Credit shall survive the termination of the Commitments and the repayment,
satisfaction or discharge of the Obligations.
ARTICLE IV
[RESERVED]
ARTICLE V
GENERAL LOAN PROVISIONS
SECTION 5.1 Interest.
(a) Interest Rate Options. Subject to the provisions of this Section, at the election of the
Borrower, Revolving Credit Loans shall bear interest at (A) the Base Rate plus the Applicable Margin
or (B) the LIBOR Rate plus the Applicable Margin (provided that the LIBOR Rate shall not be
available until three (3) Business Days (or four (4) Business Days with respect to a LIBOR Rate based
on a twelve month Interest Period) after the Closing Date unless the Borrower has delivered to the
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Lender a letter in form and substance reasonably satisfactory to the Lender indemnifying the Lender in
the manner set forth in Section 5.9 of this Agreement). The Borrower shall select the rate of interest
and Interest Period, if any, applicable to any Loan at the time a Notice of Borrowing is given or at the
time a Notice of Conversion/Continuation is given pursuant to Section 5.2.
(b) Default Rate. Subject to Section 10.3, (i) immediately upon the occurrence and during
the continuance of an Event of Default under Section 10.1(a), (b), (i) or (j), or (ii) at the election of the
Lender, upon the occurrence and during the continuance of any other Event of Default, (A) the
Borrower shall no longer have the option to request LIBOR Rate Loans or Letters of Credit, (B) all
outstanding LIBOR Rate Loans shall bear interest at a rate per annum of two percent (2%) in excess of
the rate (including the Applicable Margin) then applicable to LIBOR Rate Loans until the end of the
applicable Interest Period and thereafter at a rate equal to two percent (2%) in excess of the rate
(including the Applicable Margin) then applicable to Base Rate Loans, (C) all outstanding Base Rate
Loans and other Obligations arising hereunder or under any other Loan Document shall bear interest at
a rate per annum equal to two percent (2%) in excess of the rate (including the Applicable Margin)
then applicable to Base Rate Loans or such other Obligations arising hereunder or under any other
Loan Document and (D) all accrued and unpaid interest shall be due and payable on demand of the
Lender. Interest shall continue to accrue on the Obligations after the filing by or against the Borrower
of any petition seeking any relief in bankruptcy or under any Debtor Relief Law.
(c) Interest Payment and Computation. Interest on each Base Rate Loan shall be due and
payable in arrears on the last Business Day of each calendar quarter commencing March 31, 2018; and
interest on each LIBOR Rate Loan shall be due and payable on the last day of each Interest Period
applicable thereto, and if such Interest Period extends over three (3) months, at the end of each three
(3) month interval during such Interest Period. All computations of interest for Base Rate Loans when
the Base Rate is determined by the Prime Rate or the federal funds rate shall be made on the basis of a
year of 365 or 366 days, as the case may be, and actual days elapsed. All other computations of fees
and interest provided hereunder shall be made on the basis of a 360-day year and actual days elapsed
(which results in more fees or interest, as applicable, being paid than if computed on the basis of a
365/366-day year).
(d) Maximum Rate. In no contingency or event whatsoever shall the aggregate of all
amounts deemed interest under this Agreement charged or collected pursuant to the terms of this
Agreement exceed the highest rate permissible under any Applicable Law which a court of competent
jurisdiction shall, in a final determination, deem applicable hereto. In the event that such a court
determines that the Lender has charged or received interest hereunder in excess of the highest
applicable rate, the rate in effect hereunder shall automatically be reduced to the maximum rate
permitted by Applicable Law and the Lender shall at its option (i) promptly refund to the Borrower
any interest received by the Lender in excess of the maximum lawful rate or (ii) apply such excess to
the principal balance of the Obligations. It is the intent hereof that the Borrower not pay or contract to
pay, and that the Lender not receive or contract to receive, directly or indirectly in any manner
whatsoever, interest in excess of that which may be paid by the Borrower under Applicable Law.
SECTION 5.2 Notice and Manner of Conversion or Continuation of Loans. The Borrower
shall have the option to (a) provided that no Default or Event of Default has occurred and is then
continuing, convert at any time following the third Business Day after the Closing Date all or any
portion of any outstanding Base Rate Loans in a principal amount equal to $5,000,000 or any whole
multiple of $1,000,000 in excess thereof into one or more LIBOR Rate Loans and (b) upon the
expiration of any Interest Period, (i) convert all or any part of its outstanding LIBOR Rate Loans in a
principal amount equal to $3,000,000 or a whole multiple of $1,000,000 in excess thereof into Base
Rate Loans or (ii) provided that no Default or Event of Default has occurred and is then continuing,
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continue such LIBOR Rate Loans as LIBOR Rate Loans. Whenever the Borrower desires to convert or
continue Loans as provided above, the Borrower shall give the Lender irrevocable prior written notice
in the form attached as Exhibit E (a “Notice of Conversion/Continuation”) not later than 12:00 p.m.
three (3) Business Days before the day on which a proposed conversion or continuation of such Loan is
to be effective specifying (A) the Loans to be converted or continued, and, in the case of any LIBOR
Rate Loan to be converted or continued, the last day of the Interest Period therefor, (B) the effective
date of such conversion or continuation (which shall be a Business Day), (C) the principal amount of
such Loans to be converted or continued, and (D) the Interest Period to be applicable to such converted
or continued LIBOR Rate Loan; provided that if the Borrower wishes to request LIBOR Rate Loans
having an Interest Period of twelve months in duration, such notice must be received by the Lender not
later than 12:00 p.m. four (4) Business Days prior to the requested date of such conversion or
continuation. If the Borrower fails to give a timely Notice of Conversion/Continuation prior to the end
of the Interest Period for any LIBOR Rate Loan, then the applicable LIBOR Rate Loan shall be
converted to a Base Rate Loan. Any such automatic conversion to a Base Rate Loan shall be effective
as of the last day of the Interest Period then in effect with respect to the applicable LIBOR Rate Loan.
If the Borrower requests a conversion to, or continuation of, LIBOR Rate Loans, but fails to specify an
Interest Period, it will be deemed to have specified an Interest Period of one month.
SECTION 5.3 Fees. Commencing on the Closing Date, the Borrower shall pay to the
Lender, for its own account, a non-refundable commitment fee (the “Commitment Fee”) at a rate per
annum equal to the Applicable Margin on the average daily unused portion of the Revolving Credit
Commitment of the Lender. The Commitment Fee shall be payable in arrears on the last Business Day
of each calendar quarter during the term of this Agreement, commencing March 31, 2018 and ending on
the date upon which all Obligations (other than contingent indemnification obligations, Tax gross up,
expense reimbursement or yield protection obligations and obligations under any Hedge Agreement or
any Cash Management Agreement, in each case not then due) arising under the Revolving Credit
Facility shall have been paid and satisfied in full, all Letters of Credit have been terminated or expired
(or been Cash Collateralized) and the Revolving Credit Commitment has been terminated.
SECTION 5.4 Manner of Payment. Each payment by the Borrower on account of the
principal of or interest on the Loans or of any fee, commission or other amounts (including the
Reimbursement Obligation) payable to the Lender under this Agreement shall be made not later than
1:00 p.m. on the date specified for payment under this Agreement to the Lender in Dollars, in
immediately available funds and shall be made without any setoff, counterclaim or deduction
whatsoever. Any payment received after such time but before 2:00 p.m. on such day shall be deemed a
payment on such date for the purposes of Section 10.1, but for all other purposes shall be deemed to
have been made on the next succeeding Business Day. Any payment received after 2:00 p.m. shall be
deemed to have been made on the next succeeding Business Day for all purposes. Subject to the
definition of Interest Period, if any payment under this Agreement shall be specified to be made upon a
day which is not a Business Day, it shall be made on the next succeeding day which is a Business Day
and such extension of time shall in such case be included in computing any interest if payable along
with such payment.
SECTION 5.5 Evidence of Indebtedness. The Extensions of Credit made by the Lender
shall be evidenced by one or more accounts or records maintained by the Lender in the ordinary course
of business. The accounts or records maintained by the Lender shall be conclusive absent manifest
error of the amount of the Extensions of Credit made by the Lender to the Borrower and its Subsidiaries
and the interest and payments thereon. Any failure to so record or any error in doing so shall not,
however, limit or otherwise affect the obligation of the Borrower hereunder to pay any amount owing
with respect to the Obligations. Upon the request of the Lender, the Borrower shall execute and deliver
to the Lender a Revolving Credit Note, which shall evidence the Lender’s Revolving Credit Loans in
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addition to such accounts or records. The Lender may attach schedules to its Revolving Credit Note
and endorse thereon the date, amount and maturity of its Loans and payments with respect thereto.
SECTION 5.6 [Reserved].
SECTION 5.7 [Reserved].
SECTION 5.8 Changed Circumstances.Circumstances Affecting LIBOR Rate Availability.
Unless and until a Replacement Rate is implemented in accordance with clause (c) below, in
connection with any request for a LIBOR Rate Loan or a conversion to or continuation thereof or
otherwise, if for any reason (i) the Lender shall determine (which determination shall be conclusive
and binding absent manifest error) that Dollar deposits are not being offered to banks in the London
interbank Eurodollar market for the applicable amount and Interest Period of such Loan, (ii) the
Lender shall determine (which determination shall be conclusive and binding absent manifest error)
that reasonable and adequate means do not exist for the ascertaining the LIBOR Rate for such Interest
Period with respect to a proposed LIBOR Rate Loan or (iii) the Lender shall determine (which
determination shall be conclusive and binding absent manifest error) that the LIBOR Rate does not
adequately and fairly reflect the cost to the Lender of making or maintaining such Loans during such
Interest Period, then the Lender shall promptly give notice thereof to the Borrower. Thereafter, until
the Lender notifies the Borrower that such circumstances no longer exist, the obligation of the Lender
to make LIBOR Rate Loans and the right of the Borrower to convert any Loan to or continue any Loan
as a LIBOR Rate Loan shall be suspended, and the Borrower shall either (A) repay in full (or cause to
be repaid in full) the then outstanding principal amount of each such LIBOR Rate Loan together with
accrued interest thereon (subject to Section 5.1(d)), on the last day of the then current Interest Period
applicable to such LIBOR Rate Loan; or (B) convert the then outstanding principal amount of each
such LIBOR Rate Loan to a Base Rate Loan as of the last day of such Interest Period.
(a) Laws Affecting LIBOR Rate Availability. If, after the date hereof, the introduction of, or
any change in, any Applicable Law or any change in the interpretation or administration thereof by any
Governmental Authority, central bank or comparable agency charged with the interpretation or
administration thereof, or compliance by the Lender (or any of its Lending Offices) with any request or
directive (whether or not having the force of law) of any such Governmental Authority, central bank or
comparable agency, shall make it unlawful or impossible for the Lender (or any of its Lending Offices)
to honor its obligations hereunder to make or maintain any LIBOR Rate Loan, the Lender shall
promptly give notice thereof to the Borrower. Thereafter, until the Lender notifies the Borrower that
such circumstances no longer exist, (i) the obligations of the Lender to make LIBOR Rate Loans, and
the right of the Borrower to convert any Loan to a LIBOR Rate Loan or continue any Loan as a
LIBOR Rate Loan shall be suspended and thereafter the Borrower may select only Base Rate Loans
and (ii) if the Lender may not lawfully continue to maintain a LIBOR Rate Loan to the end of the then
current Interest Period applicable thereto, the applicable Loan shall immediately be converted to a
Base Rate Loan for the remainder of such Interest Period.
(b) Alternative Rate of Interest. Notwithstanding anything to the contrary in Section 5.8(a)
above, if the Lender has made the determination (such determination to be conclusive absent manifest
error) that (i) the circumstances described in Section 5.8(a)(i) or (a)(ii) have arisen and that such
circumstances are unlikely to be temporary, (ii) the LIBOR Rate is no longer a widely recognized
benchmark rate for newly originated loans in the U.S. loan market in the applicable currency or (iii)
the applicable supervisor or administrator (if any) of the LIBOR Rate or any Governmental Authority
having, or purporting to have, jurisdiction over the Lender has made a public statement identifying a
specific date after which the LIBOR Rate shall no longer be used for determining interest rates for
loans in the U.S. loan market in the applicable currency, then the Lender may, to the extent practicable
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(in consultation with the Borrower and as determined by the Lender to be consistent with market
practice generally), establish a replacement interest rate (the “Replacement Rate”), in which case, the
Replacement Rate shall, subject to the next two sentences, replace such applicable interest rate for all
purposes under the Loan Documents unless and until (A) an event described in Section 5.8(a)(i),
(a)(ii), (c)(i), (c)(ii) or (c)(iii) occurs with respect to the Replacement Rate or (B) the Lender notifies
the Borrower that the Replacement Rate does not adequately and fairly reflect the cost to the Lender of
funding the Loans bearing interest at the Replacement Rate. In connection with the establishment and
application of the Replacement Rate, this Agreement and the other Loan Documents shall be amended
solely with the consent of the Lender and the Borrower, as may be necessary or appropriate, in the
reasonable judgment of the Lender in consultation with the Borrower, to effect the provisions of this
Section 5.8(c). To the extent the Replacement Rate is approved by the Lender in connection with this
clause (c), the Replacement Rate shall be applied in a manner consistent with market practice;
provided that, in each case, to the extent such market practice is not administratively feasible for the
Lender, such Replacement Rate shall be applied as otherwise reasonably determined by the Lender.
SECTION 5.9 Indemnity. The Borrower hereby indemnifies the Lender against any loss or
expense (including any loss or expense arising from the liquidation or reemployment of funds obtained
by it to maintain a LIBOR Rate Loan or from fees payable to terminate the deposits from which such
funds were obtained) which may arise or be attributable to the Lender’s obtaining, liquidating or
employing deposits or other funds acquired to effect, fund or maintain any Loan (a) as a consequence of
any failure by the Borrower to make any payment when due of any amount due hereunder in connection
with a LIBOR Rate Loan, (b) due to any failure of the Borrower to borrow or continue a LIBOR Rate
Loan or convert to a LIBOR Rate Loan on a date specified therefor in a Notice of Borrowing or Notice
of Conversion/Continuation or (c) due to any payment, prepayment or conversion of any LIBOR Rate
Loan on a date other than the last day of the Interest Period therefor. The amount of such loss or
expense shall be determined, in the Lender’s sole discretion, based upon the assumption that the Lender
funded the applicable LIBOR Rate Loans in the London interbank market and using any reasonable
attribution or averaging methods which the Lender deems appropriate and practical. The Lender shall
deliver a certificate setting forth in reasonable detail the basis for determining such amount or amounts
necessary to compensate the Lender to the Borrower which certificate shall be conclusively presumed
to be correct save for manifest error.
SECTION 5.10 Increased Costs.
(a) Increased Costs Generally. If any Change in Law shall:
(i) impose, modify or deem applicable any reserve, special deposit, compulsory
loan, insurance charge or similar requirement against assets of, deposits with or for the account
of, or advances, loans or other credit extended or participated in by, the Lender (except any
reserve requirement reflected in the LIBOR Rate);
(ii) subject the Lender to any Taxes (other than (A) Indemnified Taxes, (B) Taxes
described in clauses (b) through (d) of the definition of Excluded Taxes and (C) Connection
Income Taxes) on its loans, loan principal, letters of credit, commitments, or other obligations, or
its deposits, reserves, other liabilities or capital attributable thereto; or
(iii) impose on the Lender or the London interbank market any other condition, cost
or expense (other than Taxes) affecting this Agreement or LIBOR Rate Loans made by the
Lender or any Letter of Credit;
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and the result of any of the foregoing shall be to increase the cost to the Lender of making, converting to,
continuing or maintaining any Loan (or of maintaining its obligation to make any such Loan), or to
increase the cost to the Lender of issuing or maintaining any Letter of Credit (or of maintaining its
obligation to issue any Letter of Credit), or to reduce the amount of any sum received or receivable by the
Lender hereunder (whether of principal, interest or any other amount) then, upon written request of the
Lender, the Borrower shall promptly pay to the Lender such additional amount or amounts as will
compensate the Lender for such additional costs incurred or reduction suffered.
(b) Capital Requirements. If the Lender determines that any Change in Law affecting the
Lender or any Lending Office of the Lender or the Lender’s holding company, if any, regarding capital
or liquidity requirements, has or would have the effect of reducing the rate of return on the Lender’s
capital or on the capital of the Lender’s holding company, if any, as a consequence of this Agreement,
the Revolving Credit Commitment of the Lender or the Loans or the Letters of Credit made or issued
by the Lender, to a level below that which the Lender or the Lender’s holding company could have
achieved but for such Change in Law (taking into consideration the Lender’s policies and the policies
of the Lender’s holding company with respect to capital adequacy and liquidity), then from time to
time upon written request of the Lender, the Borrower shall promptly pay to the Lender such
additional amount or amounts as will compensate the Lender or the Lender’s holding company for any
such reduction suffered.
(c) Certificates for Reimbursement. A certificate of the Lender setting forth in reasonable
detail the amount or amounts necessary to compensate the Lender or its holding company, as the case
may be, as specified in paragraph (a) or (b) of this Section and delivered to the Borrower, shall be
conclusive absent manifest error. The Borrower shall pay the Lender the amount shown as due on any
such certificate within ten (10) days after receipt thereof.
(d) Delay in Requests. Failure or delay on the part of the Lender to demand compensation
pursuant to this Section shall not constitute a waiver of the Lender’s right to demand such
compensation; provided that the Borrower shall not be required to compensate the Lender pursuant to
this Section for any increased costs incurred or reductions suffered more than one hundred eighty
(180) days prior to the date that the Lender notifies the Borrower of the Change in Law giving rise to
such increased costs or reductions, and of the Lender’s intention to claim compensation therefor
(except that if the Change in Law giving rise to such increased costs or reductions is retroactive, then
the one hundred eighty (180) day period referred to above shall be extended to include the period of
retroactive effect thereof).
SECTION 5.11 Taxes.
(a) Defined Terms. For purposes of this Section 5.11, the term “Applicable Law” includes
FATCA.
(b) Payments Free of Taxes. Any and all payments by or on account of any obligation of any
Credit Party under any Loan Document shall be made without deduction or withholding for any Taxes,
except as required by Applicable Law. If any Applicable Law (as determined in the good faith
discretion of an applicable Withholding Agent) requires the deduction or withholding of any Tax from
any such payment by a Withholding Agent, then the applicable Withholding Agent shall be entitled to
make such deduction or withholding and shall timely pay the full amount deducted or withheld to the
relevant Governmental Authority in accordance with Applicable Law and, if such Tax is an
Indemnified Tax, then the sum payable by the applicable Credit Party shall be increased as necessary
so that, after such deduction or withholding has been made (including such deductions and
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withholdings applicable to additional sums payable under this Section), the Lender receives an amount
equal to the sum it would have received had no such deduction or withholding been made.
(c) Payment of Other Taxes by the Credit Parties. The Credit Parties shall timely pay to the
relevant Governmental Authority in accordance with Applicable Law, or at the option of the Lender
timely reimburse it for the payment of, any Other Taxes.
(d) Indemnification by the Credit Parties. The Credit Parties shall indemnify the Lender,
within ten (10) days after demand therefor, for the full amount of any Indemnified Taxes (including
Indemnified Taxes imposed or asserted on or attributable to amounts payable under this Section)
payable or paid by the Lender or required to be withheld or deducted from a payment to the Lender
and any reasonable expenses arising therefrom or with respect thereto, whether or not such
Indemnified Taxes were correctly or legally imposed or asserted by the relevant Governmental
Authority. A certificate as to the amount of such payment or liability delivered to the Borrower by the
Lender shall be conclusive absent manifest error.
(e) Status of Lenders. Any Lender that is entitled to an exemption from or reduction of
withholding Tax with respect to payments made under any Loan Document shall deliver to the
Borrower, at the time or times reasonably requested by the Borrower, such properly completed and
executed documentation reasonably requested by the Borrower as will permit such payments to be
made without withholding or at a reduced rate of withholding. In addition, any Lender, if reasonably
requested by the Borrower, shall deliver such other documentation prescribed by Applicable Law or
reasonably requested by the Borrower as will enable the Borrower to determine whether or not such
Lender is subject to backup withholding or information reporting requirements. Each Lender agrees
that if any form or certification it previously delivered expires or becomes obsolete or inaccurate in
any respect, it shall update such form or certification or promptly notify the Borrower in writing of its
legal inability to do so.
(f) Evidence of Payments. As soon as practicable after any payment of Taxes by any Credit
Party to a Governmental Authority pursuant to this Section 5.11, such Credit Party shall deliver to the
Lender the original or a certified copy of a receipt issued by such Governmental Authority evidencing
such payment, a copy of the return reporting such payment or other evidence of such payment
reasonably satisfactory to the Lender.
(g) [Reserved].
(h) Treatment of Certain Refunds. If any party determines, in its sole discretion exercised in
good faith, that it has received a refund of any Taxes as to which it has been indemnified pursuant to
this Section 5.11 (including by the payment of additional amounts pursuant to this Section 5.11), it
shall pay to the indemnifying party an amount equal to such refund (but only to the extent of
indemnity payments made under this Section with respect to the Taxes giving rise to such refund), net
of all out-of-pocket expenses (including Taxes) of such indemnified party and without interest (other
than any interest paid by the relevant Governmental Authority with respect to such refund). Such
indemnifying party, upon the request of such indemnified party, shall repay to such indemnified party
the amount paid over pursuant to this paragraph (h) (plus any penalties, interest or other charges
imposed by the relevant Governmental Authority) in the event that such indemnified party is required
to repay such refund to such Governmental Authority. Notwithstanding anything to the contrary in
this paragraph (h), in no event will the indemnified party be required to pay any amount to an
indemnifying party pursuant to this paragraph (h) the payment of which would place the indemnified
party in a less favorable net after-Tax position than the indemnified party would have been in if the
Tax subject to indemnification and giving rise to such refund had not been deducted, withheld or
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otherwise imposed and the indemnification payments or additional amounts with respect to such Tax
had never been paid. This paragraph shall not be construed to require any indemnified party to make
available its Tax returns (or any other information relating to its Taxes that it deems confidential) to
the indemnifying party or any other Person.
(i) Survival. Each party’s obligations under this Section 5.11 shall survive the termination
of the Commitments and the repayment, satisfaction or discharge of all obligations under any Loan
Document.
ARTICLE VI
CONDITIONS OF CLOSING AND BORROWING
SECTION 6.1 Conditions to Closing and Initial Extensions of Credit. The obligation of the
Lender to close this Agreement and to make the initial Loans or issue the initial Letter of Credit, if any,
is subject to the satisfaction of each of the following conditions:
(a) Executed Loan Documents. This Agreement, a Revolving Credit Note in favor of the
Lender, the Guaranty Agreement, together with any other applicable Loan Documents specified by the
Lender to the Borrower to be delivered on the Closing Date, shall have been duly authorized, executed
and delivered to the Lender by the parties thereto, shall be in full force and effect and no Default or
Event of Default shall exist hereunder or thereunder.
(b) Closing Certificates; Etc. The Lender shall have received each of the following in form
and substance reasonably satisfactory to the Lender:
(i) Officer’s Certificate. A certificate from a Responsible Officer of the Borrower to
the effect that (A) all representations and warranties of the Credit Parties contained in this
Agreement and the other Loan Documents are true and correct in all material respects (except to
the extent any such representation and warranty is qualified by materiality or reference to
Material Adverse Effect, in which case, such representation and warranty shall be true and correct
in all respects) as of the Closing Date (except to the extent any such representation or warranty
specifically refers to an earlier date, in which case, such representation and warranty shall be true
and correct in all material respects as of such earlier date (except to the extent any such
representation and warranty is qualified by materiality or reference to Material Adverse Effect, in
which case, such representation and warranty shall be true and correct in all respects as of such
earlier date); (B) none of the Credit Parties is in violation of any of the covenants contained in
this Agreement and the other Loan Documents delivered on the Closing Date; (C) after giving
effect to the transactions contemplated by this Agreement and the other Loan Documents on the
Closing Date, no Default or Event of Default has occurred and is continuing; and (D) since
December 31, 2016, no event has occurred or condition arisen, either individually or in the
aggregate, that has had or could reasonably be expected to have a Material Adverse Effect.
(ii) Certificate of Secretary of each Credit Party. A certificate of a Responsible
Officer of each Credit Party certifying as to the incumbency and genuineness of the signature of
each officer of such Credit Party executing Loan Documents to which it is a party and certifying
that attached thereto is a true, correct and complete copy of (A) the articles or certificate of
incorporation or formation (or equivalent), as applicable, of such Credit Party as in effect on the
Closing Date and all amendments thereto, certified as of a recent date by the appropriate
Governmental Authority in its jurisdiction of incorporation, organization or formation (or
equivalent), as applicable, (B) the bylaws or other governing document of such Credit Party as in
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effect on the Closing Date, (C) resolutions duly adopted by the board of directors (or other
governing body) of such Credit Party authorizing and approving the transactions contemplated
hereunder and the execution, delivery and performance of this Agreement and the other Loan
Documents to which it is a party, and (D) each certificate required to be delivered pursuant to
Section 6.1(b)(iii).
(iii) Certificates of Good Standing. Certificates as of a recent date of the good
standing of each Credit Party under the laws of its jurisdiction of incorporation, organization or
formation (or equivalent), as applicable, and, in the case of the Borrower, the State of California.
(iv) Opinions of Counsel. Opinions of counsel to the Credit Parties addressed to the
Lender with respect to the Credit Parties, the Loan Documents and such other matters as the
Lender shall reasonably request (which such opinions shall expressly permit reliance by permitted
successors and assigns of the Lender).
(c) Consents; Defaults.
(i) Governmental and Third Party Approvals. The Credit Parties shall have received
all material governmental, shareholder and third party consents and approvals necessary (or any
other material consents as determined in the reasonable discretion of the Lender) in connection
with the transactions contemplated by this Agreement and the other Loan Documents and all
applicable waiting periods shall have expired without any action being taken by any Person that
could reasonably be expected to restrain, prevent or impose any material adverse conditions on
any of the Credit Parties or such other transactions or that could seek or threaten any of the
foregoing, and no law or regulation shall be applicable which in the reasonable judgment of the
Lender could reasonably be expected to have such effect.
(ii) No Injunction, Etc. No action, proceeding or investigation shall have been
instituted, threatened in writing or proposed before any Governmental Authority to enjoin,
restrain, or prohibit, or to obtain substantial damages in respect of, or which is related to or arises
out of this Agreement or the other Loan Documents or the consummation of the transactions
contemplated hereby or thereby, or which, in the Lender’s sole discretion, would make it
inadvisable to consummate the transactions contemplated by this Agreement or the other Loan
Documents or the consummation of the transactions contemplated hereby or thereby.
(d) Financial Matters.
(i) Financial Statements. The Lender shall have received (A) the audited
Consolidated balance sheet of the Borrower and its Subsidiaries as of December 31, 2016, and the
related audited statements of income and retained earnings and cash flows for the Fiscal Year
then ended and (B) the unaudited Consolidated balance sheet of the Borrower and its Subsidiaries
as of September 30, 2017, and related unaudited interim statements of income and cash flows.
(ii) Financial Projections. The Lender shall have received projections prepared by
management of the Borrower in form and scope reasonably satisfactory to the Lender for the
Fiscal Year ending December 31, 2018.
(iii) Financial Condition/Solvency Certificate. The Borrower shall have delivered to
the Lender a certificate, in form and substance reasonably satisfactory to the Lender, and certified
as accurate by the chief financial officer of the Borrower, that (A) after giving effect to the
transactions contemplated by this Agreement and the other Loan Documents on the Closing Date,
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the Credit Parties, taken as a whole, are Solvent, and (B) the financial projections previously
delivered to the Lender represent the good faith estimates (utilizing reasonable assumptions) of
the financial condition and operations of the Borrower and its Subsidiaries (it being understood
that such projections are not to be viewed as facts and that the actual results during the period or
periods covered by such projections may vary from such projections and such variance may be
material).
(iv) Payment at Closing. The Borrower shall have paid or made arrangements to pay
contemporaneously with closing (A) to the Lender any accrued and unpaid fees or commissions
due hereunder, (B) to the extent an invoice therefor is provided to the Borrower at least one
Business Day in advance of the Closing Date, all fees, charges and disbursements of counsel to
the Lender (directly to such counsel if requested by the Lender) to the extent accrued and unpaid
prior to or on the Closing Date, plus such additional amounts of such fees, charges and
disbursements as shall constitute its reasonable estimate of such fees, charges and disbursements
incurred or to be incurred by it through the closing proceedings (provided that such estimate shall
not thereafter preclude a final settling of accounts between the Borrower and the Lender) and
(C) to the extent an invoice therefor is provided to the Borrower at least one Business Day in
advance of the Closing Date, to any other Person such amount as may be due thereto in
connection with the transactions contemplated hereby, including all taxes, fees and other charges
in connection with the execution, delivery, recording, filing and registration of any of the Loan
Documents.
(e) Miscellaneous.
(i) Notice of Account Designation. The Lender shall have received a Notice of
Account Designation specifying the account or accounts to which the proceeds of any Loans
made on or after the Closing Date are to be disbursed.
(ii) Existing Indebtedness. All existing Indebtedness of the Borrower and its
Subsidiaries (including Indebtedness under the Existing Credit Agreement but excluding
Indebtedness permitted pursuant to Section 9.1) shall be repaid in full, all commitments (if any)
in respect thereof shall have been terminated and all guarantees therefor and security therefor
shall be released, and the Lender shall have received pay-off letters in form and substance
satisfactory to it evidencing such repayment, termination and release.
(iii) PATRIOT Act, etc. The Borrower and each of the Subsidiary Guarantors shall
have provided to the Lender the documentation and other information requested by the Lender, to
the extent requested at least five (5) days prior to the Closing Date, in order to comply with
requirements of any Anti-Money Laundering Laws, including, without limitation, the PATRIOT
Act and any applicable “know your customer” rules and regulations.
(iv) Other Documents. All opinions, certificates and other instruments and all
proceedings in connection with the transactions contemplated by this Agreement shall be
reasonably satisfactory in form and substance to the Lender. The Lender shall have received
copies of all other documents, certificates and instruments reasonably requested thereby, with
respect to the transactions contemplated by this Agreement.
SECTION 6.2 Conditions to All Extensions of Credit. The obligations of the Lender to
make any Extensions of Credit (including the initial Extension of Credit), convert or continue any Loan
or issue or extend any Letter of Credit are subject to the satisfaction of the following conditions
precedent on the relevant borrowing, continuation, conversion, issuance or extension date:
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(a) Continuation of Representations and Warranties. Other than in connection with any
conversion or continuation of any Loan, the representations and warranties of the Credit Parties
contained in this Agreement and the other Loan Documents shall be true and correct in all material
respects, except for any representation and warranty that is qualified by materiality or reference to
Material Adverse Effect, which such representation and warranty shall be true and correct in all
respects, on and as of such borrowing, issuance or extension date with the same effect as if made on
and as of such date (except for any such representation and warranty that by its terms is made only as
of an earlier date, which representation and warranty shall remain true and correct in all material
respects as of such earlier date, except for any representation and warranty that is qualified by
materiality or reference to Material Adverse Effect, which such representation and warranty shall be
true and correct in all respects as of such earlier date).
(b) No Existing Default. No Default or Event of Default shall have occurred and be
continuing (i) on the borrowing date of any Loan, or the continuation or conversion date with respect
to any Loan that is continued as, or converted to, a LIBOR Rate Loan, or after giving effect to the
Loans to be made or Loans to be continued as, or converted to, LIBOR Rate Loans, on such date or (ii)
on the issuance or extension date with respect to such Letter of Credit or after giving effect to the
issuance or extension of such Letter of Credit on such date.
(c) Notices. The Lender shall have received a Notice of Borrowing, Letter of Credit
Application, or Notice of Conversion/Continuation, as applicable, from the Borrower in accordance
with Section 2.3(a), Section 3.2, or Section 5.2, as applicable.
ARTICLE VII
REPRESENTATIONS AND WARRANTIES OF THE CREDIT PARTIES
To induce the Lender to enter into this Agreement and to induce the Lender to make Extensions
of Credit, the Credit Parties hereby represent and warrant to the Lender both before and after giving effect
to the transactions contemplated hereunder, which representations and warranties shall be deemed made
on the Closing Date and as otherwise set forth in Section 6.2, that:
SECTION 7.1 Organization; Power; Qualification. Each Credit Party and each Subsidiary
thereof (a) is duly organized, validly existing and in good standing (to the extent applicable) under the
laws of the jurisdiction of its incorporation or formation, (b) has the power and authority to own its
Properties and to carry on its business as now being and hereafter proposed to be conducted and (c) is
duly qualified and authorized to do business in each jurisdiction in which the character of its Properties
or the nature of its business requires such qualification and authorization except in jurisdictions where
the failure to be so qualified or in good standing could not reasonably be expected to result in a Material
Adverse Effect. The jurisdictions in which each Credit Party and each Subsidiary thereof are organized
and qualified to do business as of the Closing Date are described on Schedule 7.1 to the Disclosure
Letter. No Credit Party nor any Subsidiary thereof is an EEA Financial Institution.
SECTION 7.2 Ownership. Each (i) Subsidiary of each Credit Party as of the Closing Date
and (ii) each Material Subsidiary of the Borrower as of the Closing Date is listed on Schedule 7.2 to the
Disclosure Letter. All outstanding shares of Equity Interests in the Borrower’s Subsidiaries have been
duly authorized and validly issued and, to the extent applicable, are fully paid and nonassessable and
not subject to any preemptive or similar rights.
SECTION 7.3 Authorization; Enforceability. Each Credit Party has the right, power and
authority and has taken all necessary corporate and other action to authorize the execution, delivery and
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performance of this Agreement and each of the other Loan Documents to which it is a party in
accordance with their respective terms. This Agreement and each of the other Loan Documents have
been duly executed and delivered by the duly authorized officers of each Credit Party that is a party
thereto, and each such document constitutes the legal, valid and binding obligation of each Credit Party
that is a party thereto, enforceable in accordance with its terms, except as such enforceability may be
limited by bankruptcy, insolvency, reorganization, moratorium or similar state or federal Debtor Relief
Laws from time to time in effect which affect the enforcement of creditors’ rights in general and the
availability of equitable remedies (regardless of whether enforcement is sought in equity or at law).
SECTION 7.4 Compliance of Agreement, Loan Documents and Borrowing with Laws, Etc.
The execution, delivery and performance by each Credit Party of the Loan Documents to which each
such Person is a party, in accordance with their respective terms, the Extensions of Credit hereunder
and the transactions contemplated hereby or thereby do not and will not, by the passage of time, the
giving of notice or otherwise, (a) require any Governmental Approval or violate any Applicable Law
relating to any Credit Party where the failure to obtain such Governmental Approval or such violation
could reasonably be expected to have a Material Adverse Effect, (b) conflict with, result in a breach of
or constitute a default under the articles of incorporation, bylaws or other organizational documents of
any Credit Party, (c) conflict with, result in a breach of or constitute a default under any indenture,
agreement or other instrument to which such Person is a party or by which any of its properties may be
bound or any Governmental Approval relating to such Person, which could, individually or in the
aggregate, reasonably be expected to have a Material Adverse Effect, (d) result in or require the
creation or imposition of any Lien upon or with respect to any property now owned or hereafter
acquired by such Person other than Permitted Liens or (e) require any consent or authorization of, filing
with, or other act in respect of, an arbitrator or Governmental Authority and no consent of any other
Person is required in connection with the execution, delivery, performance, validity or enforceability of
this Agreement other than (i) consents, authorizations, filings or other acts or consents that have been
made or obtained or for which the failure to obtain or make could not, individually or in the aggregate,
reasonably be expected to have a Material Adverse Effect, (ii) consents or filings with respect to the
Cash Collateral to be made, or otherwise delivered to Lender for filing and/or recordation.
SECTION 7.5 Compliance with Law; Governmental Approvals. Each Credit Party and
each Subsidiary thereof (a) has all Governmental Approvals required by any Applicable Law for it to
conduct its business as currently conducted, each of which is in full force and effect and is not the
subject of any pending or, to its knowledge, threatened in writing cancellation or termination, (b) is in
compliance with each Governmental Approval applicable to it and in compliance with all other
Applicable Laws relating to it or any of its respective properties and (c) has timely filed all material
reports, documents and other materials required to be filed by it under all Applicable Laws with any
Governmental Authority and has retained all material records and documents required to be retained by
it under Applicable Law, except in each case of clauses (a), (b) or (c) where the failure to have, be in
full force and effect, comply or file could not reasonably be expected to have a Material Adverse Effect.
SECTION 7.6 Tax Returns and Payments. Each Credit Party and each Subsidiary thereof
has duly filed or caused to be filed all federal and other tax returns required by Applicable Law to be
filed by it, and has paid, or made adequate provision for the payment of, all federal, state, and local
income taxes and all other material taxes, assessments and governmental charges or levies upon it and
its property, income, profits and assets which are due and payable (other than, in each case, (i) any
amount the validity of which is currently being contested in good faith by appropriate proceedings and
with respect to which reserves in conformity with GAAP have been provided for on the books of the
relevant Credit Party or (ii) where the failure to file or pay such taxes, assessments and governmental
charges or levies could not reasonably be expected to have a Material Adverse Effect). Such returns
accurately reflect in all material respects all liability for taxes of any Credit Party or any Subsidiary
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thereof for the periods covered thereby. No Governmental Authority has asserted in writing any Lien
or other claim against any Credit Party or any Subsidiary thereof with respect to material unpaid taxes
which has not been discharged or resolved (other than (a) any amount the validity of which is currently
being contested in good faith by appropriate proceedings and with respect to which reserves in
conformity with GAAP have been provided for on the books of the relevant Credit Party and
(b) Permitted Liens).
SECTION 7.7 Intellectual Property Matters. Each Credit Party and each Subsidiary thereof
owns or possesses rights to use all material franchises, licenses, copyrights, copyright applications,
patents, patent rights or licenses, patent applications, trademarks, trademark rights, service marks,
service mark rights, trade names, trade name rights, copyrights and other rights with respect to the
foregoing which are material and reasonably necessary to conduct its business. No event has occurred
which permits, or after notice or lapse of time or both would permit, the revocation or termination of
any such rights, and no Credit Party nor any Subsidiary thereof is liable to any Person for infringement
under Applicable Law with respect to any such rights as a result of its business operations, except in
each case where such revocation, termination or infringement could not reasonably be expected to have
a Material Adverse Effect.
SECTION 7.8 Environmental Matters.
(a) The real properties owned, leased or operated by each Credit Party and each Subsidiary
thereof now or in the past do not contain, and to their knowledge have not previously contained, any
Hazardous Materials in amounts or concentrations which constitute or constituted a violation of
applicable Environmental Laws where such violation could reasonably be expected to have a Material
Adverse Effect;
(b) To its knowledge, each Credit Party and each Subsidiary thereof and such properties and
all operations conducted in connection therewith are in compliance, and have been in compliance, with
all applicable Environmental Laws, and there is no contamination at, under or about such properties or
such operations which could reasonably be expected to interfere with the continued operation of such
properties or impair the fair saleable value thereof, except where such failure to be in compliance or
such interference or impairment could not reasonably be expected to have a Material Adverse Effect;
(c) No Credit Party nor any Subsidiary thereof has received any written notice of violation,
alleged violation, non-compliance, liability or potential liability regarding environmental matters,
Hazardous Materials, or compliance with Environmental Laws that could reasonably be expected,
individually or in the aggregate, to have a Material Adverse Effect, nor does any Credit Party or any
Subsidiary thereof have knowledge or reason to believe that any such notice will be received or is
being threatened;
(d) To its knowledge, Hazardous Materials have not been transported or disposed of to or
from the properties owned, leased or operated by any Credit Party or any Subsidiary thereof in
violation of, or in a manner or to a location which could give rise to liability of the Borrower or any
Subsidiary under, Environmental Laws, nor have any Hazardous Materials been generated, treated,
stored or disposed of at, on or under any of such properties in violation of, or in a manner that could
give rise to liability of the Borrower or any Subsidiary under, any applicable Environmental Laws in
each case that could reasonably be expected to have a Material Adverse Effect;
(e) No judicial proceedings or governmental or administrative action is pending, or, to the
knowledge of the Borrower, threatened in writing, under any Environmental Law to which any Credit
Party or any Subsidiary thereof is or will be named as a potentially responsible party, nor are there any
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consent decrees or other decrees, consent orders, administrative orders or other orders, or other
administrative or judicial requirements outstanding under any applicable Environmental Law with
respect to any Credit Party, any Subsidiary thereof, with respect to any real property owned, leased or
operated by any Credit Party or any Subsidiary thereof or operations conducted in connection
therewith that in each case could reasonably be expected, individually or in the aggregate, to have a
Material Adverse Effect; and
(f) There has been no release, or to its knowledge, threat of release, of Hazardous Materials
at or from real properties owned, leased or operated by any Credit Party or any Subsidiary, now or, to
the knowledge of the Borrower, in the past, in violation of or in amounts or in a manner that could
give rise to liability of the Borrower or any Subsidiary under applicable Environmental Laws that
could reasonably be expected, individually or in the aggregate, to have a Material Adverse Effect.
SECTION 7.9 Employee Benefit Matters.
(a) As of the Closing Date, no Credit Party nor any ERISA Affiliate maintains or contributes
to, or has any obligation under, any Pension Plan or Multiemployer Plan other than those identified on
Schedule 7.9 to the Disclosure Letter;
(b) Each Credit Party and each ERISA Affiliate is in compliance with all applicable
provisions of ERISA, the Code and the regulations and published interpretations thereunder with
respect to all Employee Benefit Plans except for any required amendments for which the remedial
amendment period as defined in Section 401(b) of the Code has not yet expired or except where a
failure to so comply could not reasonably be expected to have a Material Adverse Effect. Each
Employee Benefit Plan that is intended to be qualified under Section 401(a) of the Code has been
determined by the IRS to be so qualified, and each trust related to such plan has been determined to be
exempt under Section 501(a) of the Code except for such plans that have not yet received
determination, opinion and/or advisory letters, as applicable, but for which the remedial amendment
period for submitting a determination, opinion and/or advisory letter, as applicable, has not yet
expired. No liability has been incurred by any Credit Party or any ERISA Affiliate which remains
unsatisfied for any taxes or penalties assessed with respect to any Employee Benefit Plan or any
Multiemployer Plan except for a liability that could not reasonably be expected to have a Material
Adverse Effect;
(c) As of the Closing Date, no Pension Plan has been terminated, nor has any Pension Plan
become subject to funding based benefit restrictions under Section 436 of the Code, nor has any
funding waiver from the IRS been received or requested with respect to any Pension Plan, nor has any
Credit Party or any ERISA Affiliate failed to make any contributions or to pay any amounts due and
owing as required by Sections 412 or 430 of the Code, Section 302 of ERISA or the terms of any
Pension Plan on or prior to the due dates of such contributions under Sections 412 or 430 of the Code
or Section 302 of ERISA, nor has there been any event requiring any disclosure under
Section 4041(c)(3)(C) or 4063(a) of ERISA with respect to any Pension Plan;
(d) Except where the failure of any of the following representations to be correct could not
reasonably be expected, individually or in the aggregate, to have a Material Adverse Effect, no Credit
Party nor any ERISA Affiliate has: (i) engaged in a nonexempt prohibited transaction described in
Section 406 of the ERISA or Section 4975 of the Code, (ii) incurred any liability to the PBGC which
remains outstanding other than the payment of premiums and there are no premium payments which
are due and unpaid, (iii) failed to make a required contribution or payment to a Multiemployer Plan, or
(iv) failed to make a required installment or other required payment under Sections 412 or 430 of the
Code;
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(e) No Termination Event has occurred or is reasonably expected to occur;
(f) Except where the failure of any of the following representations to be correct could not
reasonably be expected, individually or in the aggregate, to have a Material Adverse Effect, no
proceeding, claim (other than a benefits claim in the ordinary course of business), lawsuit and/or
investigation is existing or, to the Borrower’s knowledge, threatened concerning or involving (i) any
employee benefit plan (as defined in Section 3(3) of ERISA) currently maintained or contributed to by
any Credit Party or any ERISA Affiliate, (ii) any Pension Plan or (iii) any Multiemployer Plan.
SECTION 7.10 Margin Stock. No Credit Party nor any Subsidiary thereof is engaged
principally or as one of its activities in the business of extending credit for the purpose of “purchasing”
or “carrying” any “margin stock” (as each such term is defined or used, directly or indirectly, in
Regulation U of the Board of Governors of the Federal Reserve System). No part of the proceeds of
any of the Loans or Letters of Credit will be used for purchasing or carrying margin stock or for any
purpose which violates the provisions of Regulation T, U or X of such Board of Governors. Following
the application of the proceeds of each Extension of Credit, not more than twenty-five percent (25%) of
the value of the assets (either of the Borrower only or of the Borrower and its Subsidiaries on a
Consolidated basis) subject to the provisions of Section 9.2 or Section 9.5 or subject to any restriction
contained in any agreement or instrument between the Borrower and the Lender or any Affiliate of the
Lender relating to Indebtedness in excess of the Threshold Amount will be “margin stock”.
SECTION 7.11 Government Regulation. No Credit Party nor any Subsidiary thereof is an
“investment company” or a company “controlled” by an “investment company” (as each such term is
defined or used in the Investment Company Act) and no Credit Party nor any Subsidiary thereof is, or
after giving effect to any Extension of Credit will be, subject to regulation under the Interstate
Commerce Act, or any other Applicable Law which limits its ability to incur or consummate the
transactions contemplated hereby.
SECTION 7.12 [Reserved].
SECTION 7.13 Employee Relations. As of the Closing Date, no Credit Party nor any
Subsidiary thereof is party to any collective bargaining agreement, nor has any labor union been
recognized as the representative of its employees except as set forth on Schedule 7.13 to the Disclosure
Letter. The Borrower knows of no pending or threatened in writing strikes, work stoppage or other
collective labor disputes involving its employees or those of its Subsidiaries that, individually or in the
aggregate, could reasonably be expected to have a Material Adverse Effect.
SECTION 7.14 Burdensome Provisions. No Subsidiary is party to any agreement or
instrument or otherwise subject to any restriction or encumbrance that restricts or limits its ability to
make dividend payments or other distributions in respect of its Equity Interests to the Borrower or any
Subsidiary or to transfer any of its assets or properties to the Borrower or any other Subsidiary in each
case other than existing under or by reason of the Loan Documents or Applicable Law or as permitted
by Section 9.10.
SECTION 7.15 Financial Statements. The audited and unaudited financial statements
delivered pursuant to Section 6.1(d)(i) fairly present in all material respects on a Consolidated basis the
assets, liabilities and financial position of the Borrower and its Subsidiaries as at such dates, and the
results of the operations and changes of financial position for the periods then ended in accordance with
GAAP (other than customary year-end adjustments for unaudited financial statements and the absence
of footnotes from unaudited financial statements). All such financial statements, including the related
schedules and notes thereto, have been prepared in accordance with GAAP (other than customary year-
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end adjustments for unaudited financial statements and the absence of footnotes from unaudited
financial statements). Such financial statements show all material indebtedness and other material
liabilities, direct or contingent, of the Borrower and its Subsidiaries as of the date thereof, including
material liabilities for taxes, material commitments, and Indebtedness, in each case, to the extent
required to be disclosed under GAAP. The projections delivered pursuant to Section 6.1(d)(ii) were
prepared in good faith on the basis of the assumptions stated therein, which assumptions are believed by
the Borrower to be reasonable in light of then existing conditions (it being recognized by the Lender
that projections are not to be viewed as facts and that the actual results during the period or periods
covered by such projections may vary from such projections and such variance may be material).
SECTION 7.16 No Material Adverse Change. Since December 31, 2016, there has been no
material adverse change in the properties, business, operations, or financial condition of the Borrower
and its Subsidiaries, taken as a whole, and no event has occurred or condition arisen, either individually
or in the aggregate, that could reasonably be expected to have a Material Adverse Effect.
SECTION 7.17 Solvency. The Credit Parties, on a Consolidated basis, are Solvent.
SECTION 7.18 Title to Properties. Each Credit Party and each Subsidiary thereof has such
title to the real property owned by it and rights to use real property leased by it as is necessary or
desirable to the conduct of its business and valid and legal title to all of its personal property and assets,
except those which have been disposed of by the Credit Parties and their Subsidiaries subsequent to
such date which dispositions have been in the ordinary course of business or as otherwise expressly
permitted hereunder.
SECTION 7.19 Litigation. There are no actions, suits or proceedings pending nor, to its
knowledge, threatened in writing against any Credit Party or any Subsidiary thereof or any of their
respective properties in any court or before any arbitrator of any kind or before or by any Governmental
Authority that could reasonably be expected to have a Material Adverse Effect.
SECTION 7.20 Anti-Corruption Laws; Anti-Money Laundering Laws and Sanctions.
(a) None of (i) the Borrower, any Subsidiary, or, to the knowledge of the Borrower or such
Subsidiary, any of their respective directors, officers, employees or Affiliates, or (ii) to the knowledge of
the Borrower or any Subsidiary, any agent or representative of the Borrower or any Subsidiary that will
act in any capacity in connection with or benefit from the Revolving Credit Facility, (A) is a Sanctioned
Person or currently the subject or target of any Sanctions, (B) is controlled by or is acting on behalf of a
Sanctioned Person, (C) has its assets located in a Sanctioned Country, or (D) directly or indirectly derives
revenues from investments in, or transactions with, Sanctioned Persons.
(b) Each of the Borrower and its Subsidiaries has implemented and maintains in effect
policies and procedures designed to ensure compliance by the Borrower and its Subsidiaries and their
respective directors, officers, employees, agents and Affiliates with all Anti-Corruption Laws, Anti-
Money Laundering Laws and applicable Sanctions.
(c) Each of the Borrower and its Subsidiaries, and to the knowledge of the Borrower, each
director, officer, employee, agent and Affiliate of Borrower and each such Subsidiary, is in compliance
with all Anti-Corruption Laws, Anti-Money Laundering Laws in all material respects and applicable
Sanctions.
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(d) No proceeds of any Extension of Credit have been used, directly or indirectly, by the
Borrower or any of its Subsidiaries or, to the knowledge of the Borrower, any of its or their respective
directors, officers, employees and agents in violation of Section 8.16(b).
SECTION 7.21 Absence of Defaults. No event has occurred or is continuing which
constitutes a Default or an Event of Default.
SECTION 7.22 [Reserved].
SECTION 7.23 Disclosure. The Borrower and/or its Subsidiaries have disclosed to the
Lender all agreements, instruments and corporate or other restrictions to which any Credit Party and
any Subsidiary thereof are subject, and all other matters known to them, that, individually or in the
aggregate, could reasonably be expected to result in a Material Adverse Effect. No financial statement,
material report, material certificate or other material information furnished (whether in writing or
orally) by or on behalf of any Credit Party or any Subsidiary thereof to the Lender in connection with
the transactions contemplated hereby and the negotiation of this Agreement or delivered hereunder (as
modified or supplemented by other information so furnished), taken together as a whole and together
with the Borrower’s filings with the SEC, contains any untrue statement of a material fact or omits to
state any material fact necessary to make the statements therein, in the light of the circumstances under
which they were made, not misleading; provided that, with respect to projected financial information,
pro forma financial information, estimated financial information and other projected or estimated
information, such information was prepared in good faith based upon assumptions believed to be
reasonable at the time (it being recognized by the Lender that projections are not to be viewed as facts
and that the actual results during the period or periods covered by such projections may vary from such
projections).
SECTION 7.24 Regulatory Matters
(a) Each Credit Party and its Subsidiaries has, and it and its Products are in conformance
with, all Registrations applicable to its respective business except where the failure to have such
Registrations or be in conformance would not reasonably be expected to have, either individually or in
the aggregate, a Material Adverse Effect. No Credit Party nor any of its Subsidiaries has received
written notice that the FDA or any other Governmental Authority intends to suspend or revoke such
Registrations or changing the marketing classification affecting the Products of the Credit Parties or
any of their respective Subsidiaries. To the knowledge of each Credit Party and its Subsidiaries, there
is no material false or misleading information or material omission in any product application or other
submission to the FDA or other Governmental Authority administering Public Health Laws. To the
knowledge of each Credit Party and its Subsidiaries, no event has occurred or condition or state of
facts exists which would cause revocation or termination of any such Registration. To the knowledge
of each Credit Party and its Subsidiaries, no event has occurred or condition or state of facts exists
which would present potential product liability related, in whole or in part, to Regulatory Matters. To
the knowledge of each Credit Party and its Subsidiaries, any third party that is a manufacturer or
contractor for the Credit Parties or any of their respective Subsidiaries is in compliance in all material
respects with all Registrations required by the FDA or comparable Governmental Authority and all
Public Health Laws insofar as they reasonably pertain to the Products of the Credit Parties and their
respective Subsidiaries.
(b) Except as set forth on Schedule 7.24 to the Disclosure Letter: (i) each Credit Party and its
Subsidiaries and, to their knowledge, their respective contract manufacturers are, and have been for the
past five calendar years, in compliance in all material respects with, and each Product in current
commercial distribution has been designed, developed, investigated, manufactured, prepared,
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assembled, packaged, tested, labeled, distributed, marketed, installed, and serviced in compliance in all
material respects with the Public Health Laws or any other applicable Requirement of Law, including,
without limitation, those regarding clinical and non-clinical evaluation, product approval or clearance,
good manufacturing practices, labeling, advertising and promotion, record-keeping, establishment
registration and listing, reporting of recalls and adverse event reporting; (ii) each Credit Party and its
Subsidiaries is in compliance in all material respects with the record-keeping and reporting
requirements required by the FDA or any other Governmental Authority pertaining to the reporting of
adverse events and recalls involving the Products, including, as the case may be, Medical Device
Reporting set forth in 21 C.F.R. Part 803 and Reports of Corrections and Removals set forth in 21
C.F.R. Part 806; (iii) all Products are and have been labeled, promoted, and advertised in material
compliance with their Registration and labeling or within the scope of an exemption from obtaining
such Registration; (iv) all Products and accompanying labels have been marked with a Unique Device
Identifier as applicable under 21 C.F.R. Parts 801 and 830; and (v) each Credit Party’s and its
Subsidiaries’ establishments are registered with the FDA, as applicable, and each Product is listed with
the FDA under the applicable FDA registration and listing regulations for medical devices set forth in
21 C.F.R. Part 807.
(c) No Credit Party nor its Subsidiaries is subject to any obligation arising under any
regulatory action, proceeding, investigation or inspection by or on behalf of a Governmental
Authority, warning letter, notice of violation letter, consent decree, or other enforcement action by a
Governmental Authority with respect to Regulatory Matters, and, to the knowledge of each Credit
Party and its Subsidiaries, no such obligation has been threatened, verbally or in writing , in each case
that would reasonably be expected to have a Material Adverse Effect. To the knowledge of each
Credit Party and its Subsidiaries, there is no act, omission or event that would reasonably be expected
to give rise to or lead to, any civil, criminal or administrative action, suit, demand, claim, complaint,
hearing, investigation, demand letter, warning letter or enforcement proceeding against any Credit
Party or its Subsidiaries, and, to each Credit Party’s and its Subsidiary’s knowledge, no Credit Party
nor its Subsidiaries has any liability (whether actual or contingent) for failure to comply with any
Public Health Laws, in each case that would reasonably be expected to have a Material Adverse Effect.
There has not been any violation of any Public Health Laws by any Credit Party or its Subsidiaries that
could reasonably be expected to require or lead to investigation, enforcement, regulatory or
administrative action by the FDA or any comparable Governmental Authority, in each case that would
reasonably be expected, in the aggregate, to have a Material Adverse Effect. To the knowledge of each
Credit Party and each of their respective Subsidiaries, there are no civil or criminal proceedings
relating to any Credit Party or its Subsidiaries or any officer, director or employee of any Credit Party
or Subsidiary of any Credit Party that involve a matter within or related to the FDA’s or any
comparable Governmental Authority’s jurisdiction.
(d) No Credit Party nor its Subsidiaries is currently undergoing any inspection by FDA or
any other Governmental Authority investigation that could reasonably be expected to have a Material
Adverse Effect.
(e) No Credit Party nor any Subsidiary of any Credit Party has received any written or verbal
notice from any Governmental Authority alleging material noncompliance with any Requirement of
Law. No Product has been seized, withdrawn, recalled, detained, or subject to a suspension (other than
in the ordinary course of business) of research, manufacturing, distribution, or commercialization
activity, and, to the knowledge of Credit Party and each of its Subsidiaries, there are no facts or
circumstances reasonably likely to cause (i) the seizure, denial, withdrawal, recall, detention, public
health notification, safety alert or suspension of manufacturing or other activity relating to any Product
except as would not reasonably be expected to have a Material Adverse Effect; or (ii) a termination,
seizure or suspension of manufacturing, researching, distributing or marketing of any Product. No
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proceedings in the United States or any other jurisdiction seeking the withdrawal, recall, revocation,
suspension, import detention, or seizure of any Product are pending or threatened in writing or verbally
against any Credit Party or any of its Subsidiaries.
(f) No Credit Party nor any Subsidiary of any Credit Party nor, to the knowledge of Credit
Party or any Subsidiary, any of their respective officers, directors, employees, agents, or contractors (i)
have been excluded or debarred from any federal healthcare program (including without limitation
Medicare or Medicaid) or any other federal program or (ii) have received written notice from the FDA
or any other Governmental Authority with respect to debarment or disqualification of any Person that
would reasonably be expected to have, in the aggregate, a Material Adverse Effect. No Credit Party
nor any Subsidiary of any Credit Party nor, to the knowledge of Credit Party or any Subsidiary any of
their respective officers, directors, employees, agents or contractors have been convicted of any crime
or engaged in any conduct for which (x) debarment is mandated or permitted by 21 U.S.C. § 335a or
(y) such Person could be excluded from participating in the federal health care programs under Section
1128 of the Social Security Act or any similar law. No officer and to the knowledge of each Credit
Party and its Subsidiaries, no employee or agent of any Credit Party or its Subsidiaries, has (A) made
any untrue statement of material fact or fraudulent statement to the FDA or any other Governmental
Authority; (B) failed to disclose a material fact required to be disclosed to the FDA or any other
Governmental Authority; or (C) committed an act, made a statement, or failed to make a statement that
would reasonably be expected to provide the basis for the FDA or any other Governmental Authority
to invoke its policy respecting “Fraud, Untrue Statements of Material Facts, Bribery, and Illegal
Gratuities,” as set forth in 56 Fed. Reg. 46191 (September 10, 1991).
SECTION 7.25 Health Care Matters.
(a) Compliance with Health Care Laws; Health Care Permits. Each Credit Party and each of
their respective Subsidiaries is in compliance with all Health Care Laws applicable to it and its assets,
business or operations , except to the extent that any noncompliance, individually or in the aggregate,
could not reasonably be expected to have a Material Adverse Effect. Each Credit Party and each of
their Subsidiaries holds in full force and effect all Health Care Permits necessary for it to own, lease,
sublease or operate its assets under applicable Health Care Laws or to conduct its business and
operations as presently conducted except where the failure to hold such Health Care Permits would not
reasonably be expected to have a Material Adverse Effect. There exist no restrictions, required plans
of correction or other such remedial measures with respect to (i) any Health Care Permit of any Credit
Party or its Subsidiaries that would reasonably be expected to have, individually or in the aggregate, a
Material Adverse Effect. No circumstance exists or event has occurred which could reasonably be
expected to result in the suspension, revocation, termination, restriction, limitation, modification or
non-renewal of any material Health Care Permit held by any Credit Party or any of their Subsidiaries.
(b) Material Statements. No Credit Party nor any of their Subsidiaries, nor to the knowledge
of any Credit Party of any Subsidiary, any officer, affiliate, employee or agent of any Credit Party or
any Subsidiary of any Credit Party, has made an untrue statement of a material fact or fraudulent
statement to any Governmental Authority, failed to disclose a material fact that must be disclosed to
any Governmental Authority, or committed an act, made a statement or failed to make a statement that,
at the time such statement, disclosure or failure to disclose occurred, would constitute a violation of
any Health Care Law that could reasonably be expected to have a Material Adverse Effect.
(c) Prohibited Transactions. No Credit Party or any of its Subsidiaries nor, to the knowledge
of the Credit Parties, any officer, affiliate or managing employee of any Credit Party or any Subsidiary
of a Credit Party has (i) offered or paid or solicited or received any remuneration, in cash or in kind, or
made any financial arrangements, in material violation of any applicable Health Care Law; (ii) given
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any gift or gratuitous payment of any kind, nature or description (whether in money, property or
services) in material violation of any applicable Health Care Law; (iii) made any contribution,
payment or gift of funds or property to, or for the private use of, any governmental official, employee
or agent where either the contribution, payment or gift or the purpose of such contribution, payment or
gift was illegal in any material respect under the applicable laws of any Governmental Authority
having jurisdiction over such payment, contribution or gift; (iv) established or maintained any
unrecorded fund or asset or made any misleading, false or artificial entries on any of its books or
records in material violation of applicable Health Care Laws; or (v) made any payment to any person
with the intention that any part of such payment would be in violation of any applicable Health Care
Law. No Person has filed or has threatened in writing to file against any Credit Party or any of their
Subsidiaries an action under any federal or state whistleblower statute related to alleged
noncompliance with applicable Health Care Laws, including under the False Claims Act of 1863 (31
U.S.C. § 3729 et seq.).
(d) Exclusion. No Credit Party nor any of their Subsidiaries, nor, to the knowledge of Credit
Party or its Subsidiaries, any owner, officer, director, partner, agent or managing employee or Person
with a “direct or indirect ownership interest” (as that phrase is defined in 42 C.F.R. § 420.201) in any
Credit Party or any Subsidiary of any Credit Party or an Affiliate, has (i) had a civil monetary penalty
assessed pursuant to 42 U.S.C. § 1320a-7; (ii) been convicted (as that term is defined in 42 C.F.R.
§1001.2) of any of those offenses described in 42 U.S.C. §1320a-7b or 18 U.S.C. §§669, 1035, 1347
or 1518, including any of the following categories of offenses: (A) criminal offenses relating to the
delivery of an item or service under any federal health care program (as that term is defined in 42
U.S.C. §1320a-7b) or healthcare benefit program (as that term is defined in 18 U.S.C. §24b), (B)
criminal offenses under federal or state law relating to patient neglect or abuse in connection with the
delivery of a healthcare item or service, (C) criminal offenses under laws relating to fraud and abuse,
theft, embezzlement, false statements to third parties, money laundering, kickbacks, breach of
fiduciary responsibility or other financial misconduct in connection with the delivery of a healthcare
item or service or with respect to any act or omission in a program operated by or financed in whole or
in part by any federal, state or local governmental agency, (D) laws relating to the interference with or
obstruction of any investigations into any criminal offenses described in this clause (d), or (E) criminal
offenses under laws relating to the unlawful manufacturing, distribution, prescription or dispensing of
a controlled substance; or (iii) been involved or named in a U.S. Attorney complaint made or any other
action taken pursuant to the False Claims Act under 31 U.S.C. §§3729-3731 or qui tam action brought
pursuant to 31 U.S.C. §3729 et seq.
(e) HIPAA Compliance. Each Credit Party and each of their respective Subsidiaries is in
compliance in all material respects with HIPAA and Other Privacy Laws. Except as otherwise
disclosed in Schedule 7.25(e) to the Disclosure Letter, none of the Credit Parties nor any of their
Subsidiaries has, to the knowledge of the Credit Parties, within the past three (3) years, suffered any
breach of Regulated Information requiring any notification to any individual, entity, the media or any
Governmental Authority, received any written notice from the Office for Civil Rights for the U.S.
Department of Health and Human Services or any other Governmental Authority regarding any
allegation regarding its failure to comply with HIPAA and Other Privacy Laws, nor made any
notification of such a breach or failure to any individual or entity, the media, the Secretary of the U.S.
Department of Health and Human Services or any other Governmental Authority pursuant to HIPAA
and Other Privacy Laws. Each of the Credit Parties and each of their Subsidiaries has entered into
business associate agreements and other contractual commitments with third parties when required to
do so by HIPAA or Other Privacy Laws and is in material compliance with all such contractual
commitments.
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(f) Corporate Integrity Agreement. No Credit Party nor any of their Subsidiaries, nor, to the
knowledge of Credit Party or its Subsidiaries, any owner, officer, director, partner, agent or managing
employee of any Credit Party or any Subsidiary of any Credit Party, is a party to or bound by any
individual integrity agreement, corporate integrity agreement, corporate compliance agreement,
deferred prosecution agreement, or other formal agreement with any Governmental Authority
concerning compliance with Health Care Laws, any Government Reimbursement Programs or the
requirements of any Health Care Permit.
ARTICLE VIII
AFFIRMATIVE COVENANTS
Until all of the Obligations(other than contingent indemnification obligations, Tax gross up,
expense reimbursement or yield protection obligations and obligations under any Hedge Agreement or
any Cash Management Agreement, in each case not then due) have been paid and satisfied in full in cash,
all Letters of Credit have been terminated or expired (or been Cash Collateralized) and the Commitments
terminated, each Credit Party will, and will cause each of its Subsidiaries to:
SECTION 8.1 Financial Statements and Budgets. Deliver to the Lender:
(a) Annual Financial Statements. As soon as practicable and in any event within ninety (90)
days (or, if earlier, on the date of any required public filing thereof) after the end of each Fiscal Year
(commencing with the Fiscal Year ended December 31, 2017), an audited Consolidated balance sheet
of the Borrower and its Subsidiaries as of the close of such Fiscal Year and audited Consolidated
statements of income, retained earnings and cash flows including the notes thereto, all in reasonable
detail setting forth in comparative form the corresponding figures as of the end of and for the
preceding Fiscal Year and prepared in accordance with GAAP and, if applicable, containing disclosure
of the effect on the financial position or results of operations of any change in the application of
accounting principles and practices during the year. Such annual financial statements shall be audited
by Pricewaterhouse Coopers LLP or another independent certified public accounting firm of
recognized national standing, and accompanied by a report and opinion thereon by such certified
public accountants prepared in accordance with generally accepted auditing standards that is not
subject to any “going concern” or similar qualification or exception or any qualification as to the scope
of such audit or with respect to accounting principles followed by the Borrower or any of its
Subsidiaries not in accordance with GAAP.
(b) Quarterly Financial Statements. As soon as practicable and in any event within forty-five
(45) days (or, if earlier, on the date of any required public filing thereof) after the end of the first three
fiscal quarters of each Fiscal Year (commencing with the fiscal quarter ended March 31, 2018), an
unaudited Consolidated balance sheet of the Borrower and its Subsidiaries as of the close of such fiscal
quarter and unaudited Consolidated statements of income and cash flows and a report containing
management’s discussion and analysis of such financial statements for the fiscal quarter then ended
and that portion of the Fiscal Year then ended, including the notes thereto, all in reasonable detail
setting forth in comparative form the corresponding figures as of the end of and for the corresponding
period in the preceding Fiscal Year and prepared by the Borrower in accordance with GAAP and, if
applicable, containing disclosure of the effect on the financial position or results of operations of any
change in the application of accounting principles and practices during the period, and certified by the
chief financial officer of the Borrower to present fairly in all material respects the financial condition
of the Borrower and its Subsidiaries on a Consolidated basis as of their respective dates and the results
of operations of the Borrower and its Subsidiaries for the respective periods then ended, subject to
normal year-end adjustments and the absence of footnotes.
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(c) Annual Business Plan and Budget. As soon as practicable and in any event within ninety
(90) days after the end of each Fiscal Year (commencing with the Fiscal Year ending December 31,
2018), a business plan and operating and capital budget of the Borrower and its Subsidiaries for the
ensuing four (4) fiscal quarters, such plan to be in form and detail reasonably satisfactory to the Lender
and prepared in accordance with GAAP and to include, on a quarterly basis, the following: a quarterly
operating and capital budget (including, without limitation, the projected Capital Expenditures for such
period), a projected income statement and balance sheet, and a report containing management’s
discussion and analysis of such budget with a reasonable disclosure of the key assumptions and drivers
with respect to such budget, accompanied by a certificate from a Responsible Officer of the Borrower
to the effect that such budget contains good faith estimates (utilizing assumptions believed to be
reasonable at the time of delivery of such budget) of the financial condition and operations of the
Borrower and its Subsidiaries for such period.
SECTION 8.2 Certificates; Other Reports. Deliver to the Lender:
(a) within 5 Business Days after any financial statements are delivered pursuant to Sections
8.1(a) or (b), a duly completed Officer’s Compliance Certificate signed by the chief executive officer,
chief financial officer, treasurer or controller of the Borrower;
(b) promptly after the same are available, copies of each annual report, proxy or financial
statement or other report or communication sent to all of the stockholders of the Borrower, and copies
of all annual, regular, periodic and special reports and registration statements which the Borrower may
file or be required to file with the SEC under Section 13 or 15(d) of the Exchange Act, or with any
national securities exchange, and in any case not otherwise required to be delivered to the Lender
pursuant hereto;
(c) promptly, and in any event within five (5) Business Days after receipt thereof by any
Credit Party or any Subsidiary thereof, copies of each notice or other correspondence received from
the SEC (or comparable agency in any applicable non-U.S. jurisdiction) concerning any investigation
or possible investigation or other inquiry by such agency regarding financial or other operational
results of any Credit Party or any Subsidiary thereof, in each case that could reasonably be expected to
result in a Material Adverse Effect;
(d) promptly upon the request thereof, such other information and documentation required by
bank regulatory authorities under applicable Anti-Money Laundering Laws (including, without
limitation, any applicable “know your customer” rules and regulations and the PATRIOT Act), as
from time to time reasonably requested by the Lender; and
(e) such other information regarding the operations, business affairs and financial condition
of any Credit Party or any Subsidiary thereof as the Lender may reasonably request.
Documents required to be delivered pursuant to Section 8.1(a) or (b) or Section 8.2(b) (to the extent any
such documents are included in materials otherwise filed with the SEC) may be delivered electronically
and if so delivered, shall be deemed to have been delivered on the date (i) on which the Borrower posts
such documents, or provides a link thereto on the Borrower’s website on the Internet at the website
address listed in Section 12.1; or (ii) on which such documents are posted on the Borrower’s behalf on an
Internet or intranet website, if any, to which the Lender has access (whether a commercial, third-party
website or whether sponsored by the Lender); provided that, the Borrower shall deliver paper copies of
such documents to the Lender if it requests the Borrower to deliver such paper copies until a written
request to cease delivering paper copies is given by the Lender. Notwithstanding anything contained
herein, in every instance the Borrower shall be required to provide paper copies of the Officer’s
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Compliance Certificates required by Section 8.2 to the Lender. Except for such Officer’s Compliance
Certificates, the Lender shall have no obligation to request the delivery or to maintain copies of the
documents referred to above, and in any event shall have no responsibility to monitor compliance by the
Borrower with any such request for delivery, and the Lender shall be solely responsible for requesting
delivery to it or maintaining its copies of such documents.
SECTION 8.3 Notice of Litigation and Other Matters. Promptly (but in no event later than
ten (10) days after any Responsible Officer of the Borrower obtains knowledge thereof) notify the
Lender in writing of:
(a) the occurrence of any Default or Event of Default;
(b) the commencement of all proceedings and investigations by or before any Governmental
Authority and all actions and proceedings in any court or before any arbitrator against or involving any
Credit Party or any Subsidiary thereof or any of their respective properties, assets or businesses in each
case that could reasonably be expected to result in a Material Adverse Effect;
(c) any notice of any violation received by any Credit Party or any Subsidiary thereof from
any Governmental Authority including, without limitation, any notice of violation of Environmental
Laws which in any such case could reasonably be expected to have a Material Adverse Effect;
(d) any labor controversy that has resulted in, or threatens to result in, a strike or other work
action against any Credit Party or any Subsidiary thereof in each case that could reasonably be
expected to result in a Material Adverse Effect;
(e) (i) any unfavorable determination, opinion and/or advisory letter from the IRS regarding
the qualification of an Employee Benefit Plan under Section 401(a) of the Code (along with a copy
thereof), (ii) all notices received by any Credit Party or any ERISA Affiliate of the PBGC’s intent to
terminate any Pension Plan or Multiemployer Plan or to have a trustee appointed to administer any
Pension Plan or Multiemployer Plan, (iii) all notices received by any Credit Party or any ERISA
Affiliate from a Multiemployer Plan sponsor concerning the imposition or amount of withdrawal
liability pursuant to Section 4202 of ERISA and (iv) any Credit Party or any ERISA Affiliate has filed
or intends to file a notice of intent to terminate any Pension Plan under a distress termination within
the meaning of Section 4041(c) of ERISA;
(f) any written or verbal notice that the FDA or any other similar Governmental Authority is
limiting, suspending or revoking any Registration, changing the market classification, distribution
pathway or parameters, or labeling of the Products of the Credit Parties or their respective
Subsidiaries; (ii) any Credit Party or any of its Subsidiaries becoming subject to any administrative or
regulatory action, inspection, Form FDA 483 observation, warning letter, notice of violation letter, or
other material notice, response or commitment made to or with the FDA or any comparable
Governmental Authority, except as would not be reasonably expected to have a Material Adverse
Effect; (iii) any Product of any Credit Party or any of its Subsidiaries being seized, withdrawn,
recalled, detained, or subject to a suspension of manufacturing, or the commencement of any
proceedings in the United States or any other jurisdiction seeking the withdrawal, recall, suspension,
import detention, or seizure of any Product are pending or threatened in writing or verbally against the
Credit Parties or their respective Subsidiaries; and (iv) any voluntary withdrawal or recall of any
Product by any Credit Party or any of its Subsidiaries in an amount in excess of the Threshold Amount
or in an amount which would, in the aggregate, have a Material Adverse Effect; or
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(g) of any matter that has resulted or could reasonably be expected to result in a Material
Adverse Effect.
Each notice pursuant to Section 8.3 shall be accompanied by a statement of a Responsible Officer
of the Borrower setting forth details of the occurrence referred to therein and stating what action the
Borrower has taken and proposes to take with respect thereto. Each notice pursuant to Section 8.3(a)
shall describe with particularity any and all provisions of this Agreement and any other Loan Document
that have been breached.
SECTION 8.4 Preservation of Corporate Existence and Related Matters.
(a) Except as permitted by Section 9.4, preserve and maintain its separate corporate existence
or equivalent form.
(b) Except as could not reasonably be expected to result in a Material Adverse Effect,
preserve and maintain all rights, franchises, licenses and privileges necessary to the conduct of its
business, and qualify and remain qualified as a foreign corporation or other entity and authorized to do
business in each jurisdiction where the nature and scope of its activities require it to so qualify under
Applicable Law.
SECTION 8.5 Maintenance of Property and Licenses.
(a) Protect and preserve all Properties necessary in and material to its business, including
copyrights, patents, trade names, service marks and trademarks; maintain in good working order and
condition, ordinary wear and tear excepted, all buildings, equipment and other tangible real and
personal property necessary in and material to its business; and from time to time make or cause to be
made all repairs, renewals and replacements thereof and additions to such Property necessary for the
conduct of its business, so that the business carried on in connection therewith may be conducted in a
commercially reasonable manner, in each case except as such action or inaction could not reasonably
be expected to result in a Material Adverse Effect.
(b) Maintain, in full force and effect in all material respects, each and every license, permit,
certification, qualification, approval or franchise issued by any Governmental Authority required for
each of them to conduct their respective businesses as presently conducted, except where the failure to
do so could not reasonably be expected to have a Material Adverse Effect.
SECTION 8.6 Insurance. Maintain insurance with financially sound and reputable
insurance companies against at least such risks and in at least such amounts as are customarily
maintained by similar businesses and as may be required by Applicable Law (including, without
limitation, hazard and business interruption insurance).
SECTION 8.7 Accounting Methods and Financial Records. Maintain a system of
accounting, and keep proper books, records and accounts (which shall be accurate and complete in all
material respects) as may be required or as may be necessary to permit the preparation of financial
statements in accordance with GAAP and in compliance in all material respects with the applicable
regulations of any Governmental Authority having jurisdiction over it or any of its Properties.
SECTION 8.8 Payment of Taxes and Other Obligations. Pay and perform (a) all taxes,
assessments and other governmental charges that may be levied or assessed upon it or any of its
Property and (b) all other Indebtedness, obligations and liabilities in accordance with customary trade
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practices, except where the failure to pay or perform such items described in clauses (a) or (b) of this
Section could not reasonably be expected to have a Material Adverse Effect.
SECTION 8.9 Compliance with Laws and Approvals. Observe and remain in compliance
in all material respects with all Applicable Laws and maintain in full force and effect all Governmental
Approvals, in each case applicable to the conduct of its business, except where the failure to do so,
individually or in the aggregate, could not reasonably be expected to have a Material Adverse Effect.
SECTION 8.10 Environmental Laws. In addition to and without limiting the generality of
Section 8.9, except where the failure to so comply could not, individually or in the aggregate,
reasonably be expected to have a Material Adverse Effect (a) comply with, and use commercially
reasonable efforts to ensure such compliance by all tenants and subtenants with all applicable
Environmental Laws and obtain and comply with and maintain, and use commercially reasonable
efforts to ensure that all tenants and subtenants, if any, obtain and comply with and maintain, any and
all licenses, approvals, notifications, registrations or permits required by applicable Environmental
Laws and (b) conduct and complete all investigations, studies, sampling and testing, and all remedial,
removal and other actions required under Environmental Laws, and promptly comply with all lawful
orders and directives of any Governmental Authority regarding Environmental Laws.
SECTION 8.11 Compliance with ERISA. In addition to and without limiting the generality
of Section 8.9, except where the failure to so comply could not, individually or in the aggregate,
reasonably be expected to have a Material Adverse Effect, (i) comply with applicable provisions of
ERISA, the Code and the regulations and published interpretations thereunder with respect to all
Employee Benefit Plans, (ii) not take any action or fail to take action the result of which could
reasonably be expected to result in a liability to the PBGC or to a Multiemployer Plan, (iii) not
participate in any prohibited transaction that could result in any civil penalty under ERISA or tax under
the Code and (iv) operate each Employee Benefit Plan in such a manner that will not incur any tax
liability under Section 4980B of the Code or any liability to any qualified beneficiary as defined in
Section 4980B of the Code.
SECTION 8.12 [Reserved].
SECTION 8.13 Visits and Inspections. Permit representatives of the Lender, from time to
time upon prior reasonable notice and at such times during normal business hours, all at the expense of
the Borrower, to visit and inspect its properties; inspect, audit and make extracts from its books, records
and files, including, but not limited to, management letters prepared by independent accountants; and
discuss with its principal officers, and its independent accountants, its business, assets, liabilities,
financial condition, results of operations and business prospects; provided that excluding any such visits
and inspections during the continuation of an Event of Default, the Lender shall not exercise such rights
more often than once during any calendar year at the Borrower’s expense; provided further that upon
the occurrence and during the continuance of an Event of Default, the Lender may do any of the
foregoing at the expense of the Borrower at any time without advance notice. Upon the request of the
Lender, participate in a meeting of the Lender once during each Fiscal Year, which meeting will be held
at the Borrower’s corporate offices (or such other location as may be agreed to by the Borrower and the
Lender) at such time as may be agreed by the Borrower and the Lender. Nothing in this Section 8.13
shall require the Borrower to disclose, permit the inspection, examination or making copies or abstracts
of, or discussion of, any document, information or other matter that (i) constitutes non-financial trade
secrets or non-financial proprietary information, (ii) in respect of which disclosure to the Lender (or its
representatives) is prohibited by Applicable Law or any binding confidentiality agreement (so long as
such agreement was not entered into in contravention of the terms hereof) or (iii) is subject to attorney-
client or similar privilege or constitutes attorney work-product.
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SECTION 8.14 Additional Subsidiaries. Promptly notify the Lender of the creation or
acquisition of any Domestic Subsidiary (other than an Immaterial Subsidiary or a Foreign Subsidiary
Holding Company) and, within thirty (30) days after such creation or acquisition, as such time period
may be extended by the Lender in its sole discretion, cause such Domestic Subsidiary to (i) become a
Subsidiary Guarantor by delivering to the Lender a duly executed supplement to the Guaranty
Agreement or such other document as the Lender shall reasonably deem appropriate for such purpose,
(ii) deliver to the Lender such opinions, documents and certificates referred to in Section 6.1 with
respect to such Domestic Subsidiary as may be reasonably requested by the Lender, (iii) deliver to the
Lender such updated Schedules to the Loan Documents as requested by the Lender with respect to such
Domestic Subsidiary, and (iv) deliver to the Lender such other documents as may be reasonably
requested by the Lender in connection with such Domestic Subsidiary becoming a Subsidiary
Guarantor, all in form, content and scope reasonably satisfactory to the Lender.
SECTION 8.15 [Reserved].
SECTION 8.16 Use of Proceeds.
(a) The Borrower shall use the proceeds of the Extensions of Credit (i) to refinance
outstanding indebtedness under the Existing Credit Agreement, (ii) to pay fees and expenses in
connection with the transactions contemplated by this Agreement and the other Loan Documents on
the Closing Date, and (iii) for working capital and general corporate purposes of the Borrower and its
Subsidiaries.
(b) The Borrower will not request any Extension of Credit, and the Borrower shall not use,
and shall ensure that its Subsidiaries and, to the knowledge of the Borrower or its Subsidiaries, its or
their respective directors, officers, employees and agents shall not use, the proceeds of any Extension
of Credit, directly or indirectly, (i) in furtherance of an offer, payment, promise to pay, or authorization
of the payment or giving of money, or anything else of value, to any Person in violation in any
material respect of any Anti-Corruption Laws, (ii) for the purpose of funding, financing or facilitating
any activities, business or transaction of or with any Sanctioned Person, or in any Sanctioned Country,
or (iii) in any manner that would result in the violation of any Sanctions applicable to any party hereto.
SECTION 8.17 Compliance with Health Care Laws.
(a) Each Credit Party and each of their respective Subsidiaries will comply with all
applicable Health Care Laws ,except to the extent that any noncompliance, individually or in the
aggregate, could not reasonably be expected to have a Material Adverse Effect.
(b) Each Credit Party and each of their respective Subsidiaries shall (i) obtain, maintain and
preserve, and cause each of its Subsidiaries to obtain, maintain and preserve, and take all necessary
action to timely renew, all material Health Care Permits which are necessary or useful in the proper
conduct of its business and (ii) keep and maintain all records required to be maintained by any
Governmental Authority or otherwise under any Health Care Law.
(c) Where mandated by Applicable Law, each Credit Party and each of their respective
Subsidiaries shall maintain, in all material respects, a corporate and health care regulatory compliance
program (“RCP”) which addresses the requirements of Health Care Laws, including HIPAA and Other
Privacy Laws. Upon request, the Lender (and/or its consultants) shall be permitted to review such
RCPs.
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SECTION 8.18 Compliance with Anti-Corruption Laws; Anti-Money Laundering Laws and
Sanctions. The Borrower will maintain in effect and enforce policies and procedures designed to ensure
compliance by the Borrower, its Subsidiaries and their respective directors, officers, employees and
agents with all Anti-Corruption Laws, Anti-Money Laundering Laws and applicable Sanctions.
SECTION 8.19 Compliance with Public Health Laws. Each Credit Party and its Subsidiaries
shall comply with all applicable Public Health Laws and their implementation by any applicable
Governmental Authority applicable to its Products, except where the failure to so comply could not
reasonably be expected to have a Material Adverse Effect. All Products developed, investigated, tested,
manufactured, packaged, labeled, distributed or marketed by or on behalf of any Credit Party or any of
its Subsidiaries that are subject to the jurisdiction of the FDA or other comparable Governmental
Authority shall be developed, investigated, tested, manufactured, packaged, labeled, distributed and
marketed in compliance with applicable Public Health Laws and any other Requirements of Law,
including, without limitation, Public Health Laws or any other applicable Requirement of Laws
regarding registration and listing, product approval or premarket notification, good manufacturing
practices, labeling, advertising, promotion, record-keeping, and adverse event reporting, except where
the failure to so comply could not reasonably be expected to have a Material Adverse Effect.
SECTION 8.20 Further Assurances. Execute any and all further documents, financing
statements, agreements and instruments, and take all such further actions which the Lender may
reasonably request, to effectuate the transactions contemplated by the Loan Documents, all at the
expense of the Credit Parties.
ARTICLE IX
NEGATIVE COVENANTS
Until all of the Obligations (other than contingent indemnification obligations, Tax gross up,
expense reimbursement or yield protection obligations and obligations under any Hedge Agreement or
any Cash Management Agreement, in each case not then due) have been paid and satisfied in full in cash,
all Letters of Credit have been terminated or expired (or been Cash Collateralized) and the Commitments
terminated, the Credit Parties will not, and will not permit any of their respective Subsidiaries to.
SECTION 9.1 Indebtedness. Create, incur, assume or suffer to exist any Indebtedness
except:
(a) the Obligations;
(b) Indebtedness owing under (i) Hedge Agreements entered into in order to manage existing
or anticipated interest rate, exchange rate or commodity price risks and not for speculative purposes
and (ii) Cash Management Agreements entered into in the ordinary course of business;
(c) Indebtedness existing on the Closing Date and listed on Schedule 9.1 to the Disclosure
Letter, and Indebtedness in respect of any refinancings, refundings, renewals or extensions thereof;
provided that (i) the principal amount of such Indebtedness is not increased at the time of such
refinancing, refunding, renewal or extension except by an amount equal to a reasonable premium or
other reasonable amount paid, and fees and expenses reasonably incurred, in connection with such
refinancing, refunding, renewal or extension and by an amount equal to any existing commitments
unutilized thereunder, (ii) the direct or contingent obligor with respect thereto is not changed as a
result of such refinancing, refunding, renewal or extension and (iii) the final maturity date and
Weighted Average Life to Maturity of such refinancing, refunding, renewal or extension shall not be
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prior to or shorter than that applicable to the Indebtedness prior to such refinancing, refunding, renewal
or extension;
(d) Indebtedness arising in connection with Capital Lease Obligations and Indebtedness
incurred in connection with purchase money Indebtedness (which, for the avoidance of doubt shall
include such Indebtedness incurred in connection with the acquisition, repair, construction,
improvement or lease of the applicable Property) in an aggregate principal amount not to exceed
$30,000,000 at any time outstanding;
(e) Indebtedness of a Person arising under agreements or instruments existing at the time
such Person became a Subsidiary or assets were acquired from such Person in connection with an
Investment permitted pursuant to Section 9.3, to the extent that (i) such Indebtedness was not incurred
in connection with, or in contemplation of, such Person becoming a Subsidiary or the acquisition of
such assets, (ii) neither the Borrower nor any Subsidiary thereof (other than such Person or any other
Person that such Person merges with or that acquires the assets of such Person) shall have any liability
or other obligation with respect to such Indebtedness and (iii) the aggregate outstanding principal
amount of such Indebtedness does not exceed $30,000,000 at any time outstanding;
(f) Guarantees with respect to Indebtedness permitted pursuant to clauses (a) through (e),
(k), (n) and (o) of this Section ;
(g) unsecured intercompany Indebtedness:
(i) owed by any Credit Party to another Credit Party;
(ii) owed by any Credit Party to any Non-Guarantor Subsidiary;
(iii) owed by any Non-Guarantor Subsidiary to any other Non-Guarantor Subsidiary;
and
(iv) owed by any Non-Guarantor Subsidiary to any Credit Party to the extent
permitted pursuant to Section 9.3(a)(vi);
(h) Indebtedness arising from the honoring by a bank or other financial institution of a check,
draft or other similar instrument drawn against insufficient funds in the ordinary course of business;
(i) contingent obligations in respect of any indemnification obligation, adjustment of
purchase price, earn-out, Holdback or similar obligation of the Borrower or any Subsidiary incurred in
connection with any Permitted Acquisition or any Asset Disposition permitted hereunder;
(j) Indebtedness under performance bonds, surety bonds, release, appeal and similar bonds,
statutory obligations or with respect to workers’ compensation claims, in each case incurred in the
ordinary course of business, and reimbursement obligations (including reimbursement obligations in
respect of letters of credit issued in connection with any of the foregoing) in respect of any of the
foregoing;
(k) Indebtedness of Foreign Subsidiaries in an aggregate principal amount not to exceed
$30,000,000 at any time outstanding;
(l) Indebtedness consisting of promissory notes issued to current or former officers, directors
and employees (or their respective family members, estates or trusts or other entities for the benefit of
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any of the foregoing) of the Borrower or its Subsidiaries to purchase or redeem Equity Interests or
options of the Borrower permitted pursuant to Section 9.6(d)(iv); provided that the aggregate principal
amount of all such Indebtedness shall not exceed $5,000,000 at any time outstanding; and
(m) endorsements for collection or deposit in the ordinary course of business;
(n) Indebtedness with respect to letters of credit, bank guarantees, banker’s acceptances and
similar instruments, so long as the aggregate face amount of all such letters of credit, bank guarantees,
banker’s acceptances and similar instruments does not exceed $10,000,000 at any time; and
(o) Indebtedness of any Credit Party or any Subsidiary thereof not otherwise permitted
pursuant to this Section in an aggregate principal amount not to exceed $50,000,000 at any time
outstanding.
SECTION 9.2 Liens. Create, incur, assume or suffer to exist, any Lien on or with respect to
any of its Property, whether now owned or hereafter acquired, except:
(a) Liens on the Cash Collateral created pursuant to the Loan Documents;
(b) Liens in existence on the Closing Date and described on Schedule 9.2 to the Disclosure
Letter, and the replacement, renewal or extension thereof (including Liens incurred, assumed or
suffered to exist in connection with any refinancing, refunding, renewal or extension of Indebtedness
permitted pursuant to Section 9.1(c) (solely to the extent that such Liens were in existence on the
Closing Date and described on Schedule 9.2 to the Disclosure Letter)); provided that the scope of any
such Lien shall not be increased, or otherwise expanded, to cover any additional property or type of
asset, as applicable, beyond that in existence on the Closing Date, except for products and proceeds of
the foregoing;
(c) Liens for taxes, assessments and other governmental charges or levies (excluding any
Lien imposed pursuant to any of the provisions of ERISA or Environmental Laws) (i) not yet due or as
to which the period of grace (not to exceed thirty (30) days), if any, related thereto has not expired or
(ii) which are being contested in good faith and by appropriate proceedings if adequate reserves are
maintained to the extent required by GAAP;
(d) Liens of materialmen, mechanics, carriers, warehousemen, processors or landlords for
labor, materials, supplies or rentals incurred in the ordinary course of business, which (i) are not
overdue for a period of more than thirty (30) days, or if more than thirty (30) days overdue, no action
has been taken to enforce such Liens and such Liens are being contested in good faith and by
appropriate proceedings if adequate reserves are maintained to the extent required by GAAP and
(ii) do not, individually or in the aggregate, materially impair the use thereof in the operation of the
business of the Borrower or any of its Subsidiaries;
(e) deposits or pledges made in the ordinary course of business in connection with, or to
secure payment of, obligations under workers’ compensation, unemployment insurance and other
types of social security or similar legislation, or to secure the performance of bids, trade contracts and
leases (other than Indebtedness), statutory obligations, surety bonds (other than bonds related to
judgments or litigation), performance bonds and other obligations of a like nature incurred in the
ordinary course of business;
(f) encumbrances in the nature of zoning restrictions, easements and rights or restrictions of
record on the use of real property, which in the aggregate are not substantial in amount and which do
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not, in any case, materially detract from the value of such property or materially impair the use thereof
by the Borrower or any of its Subsidiaries in the ordinary conduct of business;
(g) Liens arising from the filing of precautionary UCC financing statements relating solely to
personal property leased pursuant to operating leases entered into in the ordinary course of business of
the Borrower and its Subsidiaries;
(h) Liens securing Indebtedness permitted under Section 9.1(d); provided that (i) such Liens
shall be created within one hundred eighty (180) days of the acquisition, repair, construction,
improvement or lease, as applicable, of the related Property, (ii) such Liens do not at any time
encumber any property other than the Property financed or improved by such Indebtedness (together
with any additions, accessions, parts, replacements, fixtures and attachments thereto, and proceeds
thereof, and any security deposit in connection therewith), and (iii) the principal amount of
Indebtedness secured by any such Lien shall at no time exceed one hundred percent (100%) of the
original price for the purchase, repair, construction, improvement or lease amount (as applicable) of
such Property at the time of purchase, repair, construction, improvement or lease (as applicable);
(i) Liens securing (i) judgments for the payment of money not constituting an Event of
Default under Section 10.1(m) or securing appeal or other surety bonds relating to such judgments or
(ii) other judgments, decrees or attachments in circumstances not constituting an Event of Default;
(j) (i) Liens on Property (i) of any Subsidiary which are in existence at the time that such
Subsidiary is acquired pursuant to a Permitted Acquisition and (ii) of the Borrower or any of its
Subsidiaries existing at the time such tangible property or tangible assets are purchased or otherwise
acquired by the Borrower or such Subsidiary thereof pursuant to a transaction permitted pursuant to
this Agreement; provided that, with respect to each of the foregoing clauses (i) and (ii), (A) such Liens
are not incurred in connection with, or in anticipation of, such Permitted Acquisition, purchase or other
acquisition, (B) such Liens are not “blanket” or all asset Liens, (C) such Liens do not attach to any
other Property of the Borrower or any of its Subsidiaries (other than any such Subsidiaries acquired
pursuant to the Permitted Acquisition or property or assets so acquired) and (D) the Indebtedness
secured by such Liens is permitted under Section 9.1(e) of this Agreement);
(k) Liens on assets of Foreign Subsidiaries; provided that (i) such Liens do not extend to, or
encumber the Equity Interests of any Subsidiary of the Borrower, and (ii) such Liens extending to the
assets of any Foreign Subsidiary secure only Indebtedness incurred by such Foreign Subsidiary
pursuant to Section 9.1(k);
(l) (i) Liens of a collecting bank arising in the ordinary course of business under Section 4-
210 of the Uniform Commercial Code in effect in the relevant jurisdiction and (ii) Liens of any
depositary bank in connection with statutory, common law and contractual rights of setoff and
recoupment with respect to any deposit account of the Borrower or any Subsidiary thereof;
(m) (i) contractual or statutory Liens of landlords to the extent relating to the property and
assets relating to any lease agreements with such landlord, and (ii) contractual Liens of suppliers
(including sellers of goods) or customers granted in the ordinary course of business to the extent
limited to the property or assets relating to such contract;
(n) any interest or title of a licensor, sublicensor, lessor or sublessor with respect to any
assets under any license or lease agreement entered into in the ordinary course of business which do
not (i) interfere in any material respect with the business of the Borrower or its Subsidiaries or
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materially detract from the value of the relevant assets of the Borrower or its Subsidiaries or (ii) secure
any Indebtedness;
(o) Liens on any cash earnest money deposits made by the Borrower or any of its
Subsidiaries in connection with any letter of intent or purchase agreement with respect to a Permitted
Acquisition;
(p) leases, licenses, subleases and sublicenses granted to others in the ordinary course of
business that do not interfere in any material respect with the business of the Borrower and its
Subsidiaries, taken as a whole;
(q) Liens in favor of customs and revenue authorities arising as a matter of law to secure
payment of customs duties in connection with the importation of goods;
(r) Liens on cash collateral securing (x) letters of credit, bank guarantees, banker’s
acceptances and similar instruments permitted under Section 9.1(n) and (y) corporate credit cards
permitted under Section 9.1(b)(ii); provided such cash collateral under this clause (y) shall not exceed
$3,000,000 in the aggregate at any time;
(s) Liens arising out of conditional sale, title retention, consignment or similar arrangements
for sale of goods by the Borrower or any of its Subsidiaries in the ordinary course of business;
(t) customary encumbrances or restrictions (including put and call arrangements) with
respect to the Equity Interests of any joint venture or minority investment in favor of the other parties
to such joint venture or other investors; and
(u) Liens not otherwise permitted hereunder securing Indebtedness or other obligations in the
aggregate principal amount not to exceed $50,000,000 at any time outstanding.
SECTION 9.3 Investments. Make any Investment, except:
(a) (i) Investments existing on the Closing Date in Subsidiaries existing on the Closing
Date;
(ii) Investments existing on the Closing Date (other than Investments in Subsidiaries
existing on the Closing Date) and described on Schedule 9.3 to the Disclosure Letter;
(iii) Investments made after the Closing Date by any Credit Party in any other Credit
Party;
(iv) Investments made after the Closing Date by any Non-Guarantor Subsidiary in
any other Non-Guarantor Subsidiary;
(v) Investments made after the Closing Date by any Non-Guarantor Subsidiary in
any Credit Party; and
(vi) Investments made after the Closing Date by any Credit Party in any Non-
Guarantor Subsidiary in an aggregate amount not to exceed $100,000,000 at any time
outstanding;
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(b) Investments in cash and Cash Equivalents, including the deposit and investment accounts
holding such cash and Cash Equivalents;
(c) Investments by the Borrower or any of its Subsidiaries consisting of Capital Expenditures
not prohibited by this Agreement or the other Loan Documents;
(d) deposits made in the ordinary course of business to secure the performance of leases or
other obligations as permitted by Section 9.2;
(e) Hedge Agreements permitted pursuant to Section 9.1;
(f) purchases of assets and commitments therefor in the ordinary course of business;
(g) Investments by the Borrower or any Subsidiary thereof in the form of Permitted
Acquisitions, including the formation of a Subsidiary in connection therewith and the capitalization of
such Subsidiary;
(h) Investments in the form of loans and advances to officers, directors and employees in the
ordinary course of business in an aggregate amount not to exceed at any time outstanding $5,000,000
(determined without regard to any write-downs or write-offs of such loans or advances);
(i) Investments in the form of Restricted Payments permitted pursuant to Section 9.6;
(j) Guarantees permitted pursuant to Section 9.1 and guarantees of liabilities not constituting
Indebtedness to the extent such guarantees or liabilities are not otherwise prohibited by this Agreement
(k) Investments in joint ventures; provided, that the aggregate amount of all such
Investments shall not at any time exceed $30,000,000;
(l) Permitted Call Spread Agreements;
(m) Investments consisting of extensions of trade credit in the ordinary course of business,
intercompany receivables and intercompany charges of expenses arising in the ordinary course of
business, and any prepayments and other credits to suppliers or vendors made in the ordinary course of
business;
(n) Investments received in connection with the bankruptcy, liquidation or reorganization of
customers or suppliers or in settlement of delinquent obligations of, and other disputes with, customers
or suppliers;
(o) Investments received in connection with Asset Dispositions permitted by Section 9.5;
(p) Investments in negotiable instruments deposited or to be deposited for collection in the
ordinary course of business;
(q) prepayments made to suppliers in the ordinary course of business;
(r) [reserved];
(s) Investments of any Person that becomes a Subsidiary after the Closing Date pursuant to a
Permitted Acquisition, provided that (i) such Investments exist at the time that such Person becomes a
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Subsidiary and (ii) such Investments were not made in anticipation of such Person becoming a
Subsidiary;
(t) Investments consisting of earnest money deposits required in connection with a Permitted
Acquisition or consisting of earnest money deposits required in connection with an acquisition of
property not otherwise prohibited hereunder;
(u) any Forward Agreement to the extent constituting an Investment that is permitted to be
entered into by Borrower pursuant to Section 9.6; and
(v) Investments not otherwise permitted pursuant to this Section not exceeding $50,000,000
in the aggregate in any Fiscal Year and in an aggregate amount not to exceed $100,000,000 at any time
outstanding; provided that, immediately before and immediately after giving pro forma effect to any
such Investments (and any Indebtedness incurred in connection therewith), no Default or Event of
Default shall have occurred and be continuing.
For purposes of determining the amount of any Investment outstanding for purposes of this Section 9.3,
such amount shall be deemed to be the amount of such Investment when made, purchased or acquired
(without adjustment for subsequent increases or decreases in the value of such Investment) less any
amount realized in respect of such Investment upon the sale, collection or return of capital (not to exceed
the original amount invested).
SECTION 9.4 Fundamental Changes. Merge, consolidate or combine with, or consummate
any Asset Disposition of all or substantially all of its assets (whether in a single transaction or a series
of transactions) with, any other Person or liquidate, wind-up or dissolve itself (or suffer any liquidation
or dissolution) except:
(a) (i) any Wholly-Owned Subsidiary of the Borrower may be merged, amalgamated or
consolidated with or into the Borrower (provided that the Borrower shall be the continuing or
surviving entity) or (ii) any Wholly-Owned Subsidiary of the Borrower may be merged, amalgamated
or consolidated with or into any Subsidiary Guarantor (provided that the Subsidiary Guarantor shall be
the continuing or surviving entity or the continuing or surviving entity shall become a Subsidiary
Guarantor and the Borrower shall comply with Section 8.14 in the time periods specified therein in
connection therewith);
(b) (i) any Non-Guarantor Subsidiary that is a Foreign Subsidiary may be merged,
amalgamated or consolidated with or into, or be liquidated into, any other Non-Guarantor Subsidiary
and (ii) any Non-Guarantor Subsidiary that is a Domestic Subsidiary may be merged, amalgamated or
consolidated with or into, or be liquidated into, any other Non-Guarantor Subsidiary that is a Domestic
Subsidiary;
(c) any Subsidiary may dispose of all or substantially all of its assets (upon voluntary
liquidation, dissolution, winding up or otherwise) to the Borrower or any Subsidiary Guarantor;
provided that, with respect to any such disposition by any Non-Guarantor Subsidiary, the consideration
for such disposition shall not exceed the fair value of such assets;
(d) (i) any Non-Guarantor Subsidiary that is a Foreign Subsidiary may dispose of all or
substantially all of its assets (upon voluntary liquidation, dissolution, winding up or otherwise) to any
other Non-Guarantor Subsidiary and (ii) any Non-Guarantor Subsidiary that is a Domestic Subsidiary
may dispose of all or substantially all of its assets (upon voluntary liquidation, dissolution, winding up
or otherwise) to any other Non-Guarantor Subsidiary that is a Domestic Subsidiary;
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(e) Asset Dispositions permitted by Section 9.5 (other than clause (b) thereof);
(f) any Wholly-Owned Subsidiary of the Borrower may merge with or into the Person such
Wholly-Owned Subsidiary was formed to acquire in connection with any acquisition permitted
hereunder (including, without limitation, any Permitted Acquisition permitted pursuant to
Section 9.3(g)); provided that in the case of any merger involving a Wholly-Owned Subsidiary that is
(or is required to be) a Subsidiary Guarantor, (i) a Subsidiary Guarantor shall be the continuing or
surviving entity or (ii) the continuing or surviving entity shall become a Subsidiary Guarantor and the
Borrower shall comply with Section 8.14 in the time periods specified therein in connection therewith;
and
(g) any Person may merge into the Borrower or any of its Wholly-Owned Subsidiaries in
connection with a Permitted Acquisition permitted pursuant to Section 9.3(g); provided that (i) in the
case of a merger involving the Borrower or a Subsidiary Guarantor, the continuing or surviving Person
shall be the Borrower or such Subsidiary Guarantor and (ii) the continuing or surviving Person shall be
the Borrower or a Wholly-Owned Subsidiary of the Borrower.
SECTION 9.5 Asset Dispositions. Make any Asset Disposition except:
(a) the sale of inventory in the ordinary course of business;
(b) the transfer of assets to the Borrower or any Subsidiary Guarantor pursuant to any other
transaction permitted pursuant to Section 9.2, Section 9.3, Section 9.4 or Section 9.6;
(c) the write-off, discount, sale or other disposition of defaulted or past-due receivables and
similar obligations in the ordinary course of business and not undertaken as part of an accounts
receivable financing transaction;
(d) the disposition or unwinding of any Hedge Agreement or Permitted Call Spread
Agreement;
(e) dispositions of Investments in cash and Cash Equivalents;
(f) the transfer by any Credit Party of its assets to any other Credit Party;
(g) the transfer by any Non-Guarantor Subsidiary of its assets to any Credit Party (provided
that in connection with any new transfer, such Credit Party shall not pay more than an amount equal to
the fair market value of such assets as determined in good faith at the time of such transfer);
(h) the transfer by any Non-Guarantor Subsidiary of its assets to any other Non-Guarantor
Subsidiary
(i) the transfer by any Credit Party to any Non-Guarantor Subsidiary subject to the limitation
and requirements set forth in Section 9.3(a)(vi) (provided that in connection with any new transfer,
such Non-Guarantor Subsidiary shall not pay less than an amount equal to the fair market value of
such assets as determined in good faith at the time of such transfer);
(j) the sale of obsolete, worn-out or surplus assets no longer used or usable in the business of
the Borrower or any of its Subsidiaries or non-core assets acquired in a Permitted Acquisition;
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(k) non-exclusive licenses and sublicenses of intellectual property rights in the ordinary
course of business not interfering, individually or in the aggregate, in any material respect with the
conduct of the business of the Borrower and its Subsidiaries;
(l) leases, subleases, licenses or sublicenses of real or personal property granted by the
Borrower or any of its Subsidiaries to others in the ordinary course of business not detracting from the
value of such real or personal property or interfering in any material respect with the business of the
Borrower or any of its Subsidiaries;
(m) Asset Dispositions in connection with Insurance and Condemnation Events;
(n) the lapse or abandonment of registered intellectual property (or applications therefor) of
the Borrower or its Subsidiaries to the extent not necessary or desirable in the conduct of their
business;
(o) Asset Dispositions in respect of fixed assets to the extent that (i) such fixed assets are
exchanged for credit against the purchase price of similar replacement fixed assets or (ii) the proceeds
of such Asset Dispositions are promptly applied to the purchase price of such replacement fixed assets;
(p) Asset Dispositions in connection with transactions permitted by Section 9.2, Section 9.3,
Section 9.4 and Section 9.6;
(q) Asset Dispositions not otherwise permitted pursuant to this Section; provided that (i) at
the time of such Asset Disposition, no Default or Event of Default shall exist or would result from
such Asset Disposition, (ii) such Asset Disposition is made for fair market value and the consideration
received shall be no less than 75% in cash, and (iii) the aggregate fair market value of all property
disposed of in reliance on this clause (p) shall not exceed 10.0% of the total assets of the Borrower and
its Subsidiaries appearing on the consolidated balance sheet of the Borrower and its Subsidiaries (but
excluding any intangible assets) as at the end of the immediately preceding Fiscal Year for which
financial statements have been delivered pursuant to Section 8.1(a); and
(r) other Asset Dispositions not otherwise permitted pursuant to this Section not exceeding
$20,000,000 per Fiscal Year.
SECTION 9.6 Restricted Payments. Declare or pay any Restricted Payments; provided that:
(a) so long as no Default or Event of Default has occurred and is continuing or would result
therefrom, the Borrower or any of its Subsidiaries may pay dividends in shares of its own Qualified
Equity Interests;
(b) any Subsidiary of the Borrower may pay cash dividends or make distributions to the
Borrower or any Subsidiary Guarantor (and, if applicable, to other holders of its outstanding Qualified
Equity Interests on a pro rata basis);
(c) (i) any Non-Guarantor Subsidiary that is a Domestic Subsidiary may make Restricted
Payments to any other Non-Guarantor Subsidiary that is a Domestic Subsidiary (and, if applicable, to
other holders of its outstanding Equity Interests on a ratable basis) and (ii) any Non-Guarantor
Subsidiary that is a Foreign Subsidiary may make Restricted Payments to any other Non-Guarantor
Subsidiary (and, if applicable, to other holders of its outstanding Equity Interests on a ratable basis);
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(d) the Borrower may make Restricted Payments pursuant to and in accordance with stock
plans and other benefit plans for management, employees or other eligible service providers of the
Borrower and its Subsidiaries, including in connection with the payment of withholding taxes in
connection with such plans;
(e) repurchases or other acquisitions of Equity Interests deemed to occur upon the exercise of
warrants or other rights to purchase Equity Interests or convertible securities if such Equity Interests
represent a portion of the exercise price thereof or conversion price thereof;
(f) the Borrower may repurchase or pay cash in lieu of fractional shares of its Equity
Interests arising out of stock dividends, splits or combinations, business combinations or conversion or
exercise of convertible securities, options or warrants;
(g) the Borrower or any Subsidiary may receive or accept the return to the Borrower or any
Subsidiary of the Equity Interests of the Borrower or any Subsidiary from the sellers constituting a
portion of the purchase price consideration in settlement of indemnification claims or as a result of
purchase price adjustments (including earn-outs and similar obligations) in connection with Permitted
Acquisitions;
(h) the Borrower may deliver shares of Borrower’s common stock in connection with the
settlement at maturity or early termination of any Forward Contract; and
(i) other Restricted Payments not otherwise permitted by this Section so long as no Default
or Event of Default has occurred and is continuing or would result therefrom (it being agreed that with
respect to the payment of cash dividends by the Borrower, such determination shall be made at the
time of the declaration of such dividend).
SECTION 9.7 Transactions with Affiliates. Directly or indirectly enter into any transaction,
including, without limitation, any purchase, sale, lease or exchange of Property, the rendering of any
service or the payment of any management, advisory or similar fees, with (a) any officer, director,
holder of any Equity Interests in, or other Affiliate of, the Borrower or any of its Subsidiaries or (b) any
Affiliate of any such officer, director or holder, other than:
(i) transactions permitted by Sections 9.1, 9.3, 9.4, 9.5, and 9.6;
(ii) transactions existing on the Closing Date and described on Schedule 9.7 to the
Disclosure Letter;
(iii) transactions between or among the Borrower or any of its Subsidiaries not
prohibited by this Agreement or the other Loan Documents;
(iv) other transactions in the ordinary course of business on terms as favorable as
would be obtained by it on a comparable arm’s-length transaction with an independent, unrelated
third party;
(v) indemnification, employment, compensation and severance arrangements
(including equity incentive plans and employee benefit plans and arrangements) with their
respective officers, directors and employees, in all cases, in the ordinary course of business, and
other compensatory arrangements approved by the board of directors of the Borrower; and
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(vi) payment of customary fees and reasonable out of pocket costs to, and indemnities
for the benefit of, directors, officers and employees of the Borrower and its Subsidiaries in the
ordinary course of business to the extent attributable to the ownership or operation of the
Borrower and its Subsidiaries.
SECTION 9.8 Accounting Changes; Organizational Documents.
(a) Change the Borrower’s Fiscal Year end, or make (without the consent of the Lender) any
material change in its accounting treatment and reporting practices except as required or permitted by
GAAP.
(b) Amend, modify or change its articles of incorporation (or corporate charter or other
similar organizational documents) or amend, modify or change its bylaws (or other similar documents)
in any manner materially adverse to the rights or interests of the Lender to receive payment of the
Obligations.
SECTION 9.9 [Reserved].
SECTION 9.10 No Further Negative Pledges; Restrictive Agreements.
(a) Enter into, assume or be subject to any agreement prohibiting or otherwise restricting the
creation or assumption of any Lien in favor of Lender upon its properties or assets, whether now
owned or hereafter acquired or requiring the grant of any security for such obligation if security is
given for some other obligation, except (i) pursuant to this Agreement and the other Loan Documents,
(ii) pursuant to any document or instrument governing Indebtedness incurred pursuant to
Section 9.1(d) or (k) (provided that in each case any such restriction contained therein relates only to
the asset or assets financed thereby), (iii) customary restrictions contained in the organizational
documents of any Non-Guarantor Subsidiary in effect as of the Closing Date, (iv) customary
restrictions in connection with any Permitted Lien or any document or instrument governing any
Permitted Lien (provided that any such restriction contained therein relates only to the asset or assets
subject to such Permitted Lien), (v) obligations that are binding on a Subsidiary at the time such
Subsidiary first becomes a Subsidiary of the Borrower (which obligation is not applicable to any
Person, or the properties or assets of any Person, other than such Subsidiary), so long as such
obligations are not entered into in contemplation of such Person becoming a Subsidiary, and any
extension or renewal thereof, so long as such extension or renewal does not expand the scope of such
restriction in any material respect, (vi) customary non-assignment provisions in contracts restricting
the assignment thereof, (vii) restrictions existing on the Closing Date and describe on Schedule 9.10 to
the Disclosure Letter and any extension or renewal thereof so long as such extension or renewal does
not expand the scope of such restrictions in any material respect, (viii) customary provisions in joint
venture agreements and other similar agreements applicable to joint ventures permitted under Section
9.3, (ix) restrictions imposed by Applicable Law, (x) customary restrictions contained in leases,
subleases or licenses otherwise permitted hereby so long as such restrictions relate only to the assets
subject thereto, (xi) customary provisions restricting subletting or assignment of any lease governing a
leasehold interest of the Borrower or any Subsidiary, (xii) restrictions on cash or Cash Equivalents or
deposits imposed by customers under contracts entered into in the ordinary course of business, (xiii)
customary net worth provisions contained in real property leases or licenses of intellectual property
entered into by the Borrower or any of its Subsidiaries and (xiv) customary restrictions and conditions
contained in asset sale agreements, purchase agreements, acquisition agreements (including by way of
merger, acquisition or consolidation) entered into by the Borrower or any Subsidiary, in each case to
the extent not prohibited under this Agreement or the other Loan Documents and solely to the extent in
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effect pending consummation of such transaction and so long as such restrictions relate only to the
assets subject thereto.
(b) Create or otherwise cause or suffer to exist or become effective any consensual
encumbrance or restriction on the ability of (i) any Subsidiary to pay dividends or make any other
distributions to the Borrower or any Subsidiary on its Equity Interests or with respect to any other
interest or participation in, or measured by, its profits, (ii) any Credit Party or any Subsidiary thereof to
pay any Indebtedness or other obligation owed to any Credit Party or (iii) any Credit Party or any
Subsidiary thereof to make loans or advances to any Credit Party, except in each case for such
encumbrances or restrictions existing under or by reason of (A) this Agreement and the other Loan
Documents, (B) Applicable Law, (C) any document or instrument governing Indebtedness incurred
pursuant to Section 9.1(d) (provided that any such restriction contained therein relates only to the asset
or assets acquired in connection therewith), (D) any Permitted Lien or any document or instrument
governing any Permitted Lien (provided that any such restriction contained therein relates only to the
asset or assets subject to such Permitted Lien), (E) obligations that are binding on a Subsidiary at the
time such Subsidiary first becomes a Subsidiary of the Borrower, so long as such obligations are not
entered into in contemplation of such Person becoming a Subsidiary, (F) customary restrictions
contained in an agreement related to the sale of Property (to the extent such sale is permitted pursuant
to Section 9.5) that limit the transfer of such Property pending the consummation of such sale,
(G) customary restrictions in leases, subleases, licenses and sublicenses or asset sale agreements
otherwise permitted by this Agreement so long as such restrictions relate only to the assets subject
thereto, (H) customary provisions restricting assignment of any agreement entered into in the ordinary
course of business, (I) restrictions existing on the Closing Date and describe on Schedule 9.10 to the
Disclosure Letter and any extension or renewal thereof so long as such extension or renewal does not
expand the scope of such restrictions in any material respect, (J) customary provisions in joint venture
agreements and other similar agreements applicable to joint ventures permitted under Section 9.3, (K)
restrictions imposed by Applicable Law, (L) customary provisions restricting subletting or assignment
of any lease governing a leasehold interest of the Borrower or any Subsidiary, (M) restrictions on cash
or Cash Equivalents or deposits imposed by customers under contracts entered into in the ordinary
course of business, (N) customary net worth provisions contained in real property leases or licenses of
intellectual property entered into by the Borrower or any of its Subsidiaries and (O) customary
restrictions and conditions contained in asset sale agreements, purchase agreements, acquisition
agreements (including by way of merger, acquisition or consolidation) entered into by the Borrower or
any Subsidiary, in each case to the extent not prohibited under this Agreement or the other Loan
Documents and solely to the extent in effect pending consummation of such transaction and so long as
such restrictions relate only to the assets subject thereto.
(c) Create or otherwise cause or suffer to exist or become effective any consensual
encumbrance or restriction on the ability of any Credit Party or any Subsidiary thereof to (i) sell, lease
or transfer any of its properties or assets to any Credit Party or (ii) act as a Credit Party pursuant to the
Loan Documents or any renewals, refinancings, exchanges, refundings or extension thereof, except in
each case for such encumbrances or restrictions existing under or by reason of (A) this Agreement and
the other Loan Documents, (B) Applicable Law, (C) any document or instrument governing
Indebtedness incurred pursuant to Section 9.1(d) (provided that any such restriction contained therein
relates only to the asset or assets acquired in connection therewith), (D) any Permitted Lien or any
document or instrument governing any Permitted Lien (provided that any such restriction contained
therein relates only to the asset or assets subject to such Permitted Lien), (E) obligations that are
binding on a Subsidiary at the time such Subsidiary first becomes a Subsidiary of the Borrower, so
long as such obligations are not entered into in contemplation of such Person becoming a Subsidiary,
(F) customary restrictions contained in an agreement related to the sale of Property (to the extent such
sale is permitted pursuant to Section 9.5) that limit the transfer of such Property pending the
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consummation of such sale, (G) customary restrictions in leases, subleases, licenses and sublicenses or
asset sale agreements otherwise permitted by this Agreement so long as such restrictions relate only to
the assets subject thereto, (H) customary provisions restricting assignment of any agreement entered
into in the ordinary course of business, (I) restrictions existing on the Closing Date and describe on
Schedule 9.10 to the Disclosure Letter and any extension or renewal thereof so long as such extension
or renewal does not expand the scope of such restrictions in any material respect, (J) customary
provisions in joint venture agreements and other similar agreements applicable to joint ventures
permitted under Section 9.3, (K) restrictions imposed by Applicable Law, (L) customary provisions
restricting subletting or assignment of any lease governing a leasehold interest of the Borrower or any
Subsidiary, (M) restrictions on cash or Cash Equivalents or deposits imposed by customers under
contracts entered into in the ordinary course of business, (N) customary net worth provisions contained
in real property leases or licenses of intellectual property entered into by the Borrower or any of its
Subsidiaries and (O) customary restrictions and conditions contained in asset sale agreements,
purchase agreements, acquisition agreements (including by way of merger, acquisition or
consolidation) entered into by the Borrower or any Subsidiary, in each case to the extent not prohibited
under this Agreement or the other Loan Documents and solely to the extent in effect pending
consummation of such transaction and so long as such restrictions relate only to the assets subject
thereto.
SECTION 9.11 Nature of Business. Engage in any business other than the business
conducted by the Borrower and its Subsidiaries as of the Closing Date and business activities
reasonably related or ancillary thereto.
SECTION 9.12 [Reserved]
SECTION 9.13 [Reserved].
SECTION 9.14 [Reserved].
SECTION 9.15 Financial Covenants.
(a) Consolidated Leverage Ratio. As of the last day of any fiscal quarter, permit the
Consolidated Leverage Ratio to be greater than 3.00 to 1.00.
(b) Consolidated Interest Coverage Ratio. As of the last day of any fiscal quarter, permit the
Consolidated Interest Coverage Ratio to be less than 3.00 to 1.00.
ARTICLE X
DEFAULT AND REMEDIES
SECTION 10.1 Events of Default. Each of the following shall constitute an Event of
Default:
(a) Default in Payment of Principal of Loans and Reimbursement Obligations. The
Borrower shall default in any payment of principal of any Loan or Reimbursement Obligation when
and as due (whether at maturity, by reason of acceleration or otherwise) or fail to provide Cash
Collateral pursuant to Section 2.4(b), Section 2.5(d) or Section 3.11.
(b) Other Payment Default. The Borrower shall default in the payment when and as due
(whether at maturity, by reason of acceleration or otherwise) of interest on any Loan or
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Reimbursement Obligation or the payment of any other Obligation, and such default shall continue for
a period of three (3) Business Days.
(c) Misrepresentation. Any representation, warranty, certification or statement of fact made
or deemed made by or on behalf of any Credit Party or any Subsidiary thereof in this Agreement, in
any other Loan Document, or in any document delivered by any Credit Party or any Subsidiary in
connection herewith or therewith that is subject to materiality or Material Adverse Effect
qualifications, shall be incorrect or misleading in any respect when made or deemed made or any
representation, warranty, certification or statement of fact made or deemed made by or on behalf of
any Credit Party or any Subsidiary thereof in this Agreement, any other Loan Document, or in any
document delivered by any Credit Party or any Subsidiary in connection herewith or therewith that is
not subject to materiality or Material Adverse Effect qualifications, shall be incorrect or misleading in
any material respect when made or deemed made.
(d) Default in Performance of Certain Covenants. Any Credit Party or any Subsidiary
thereof shall default in the performance or observance of any covenant or agreement contained in
Sections 8.1, 8.2, 8.3, 8.4(with respect to the existence of any Credit Party), 8.13, 8.14, 8.16, 8.18 or
8.19 or Article IX.
(e) Default in Performance of Other Covenants and Conditions. Any Credit Party or any
Subsidiary thereof shall default in the performance or observance of any term, covenant, condition or
agreement contained in this Agreement (other than as specifically provided for in this Section) or any
other Loan Document and such default shall continue for a period of thirty (30) days after the earlier of
(i) the Lender’s delivery of written notice thereof to the Borrower and (ii) a Responsible Officer of any
Credit Party having obtained knowledge thereof.
(f) Indebtedness Cross-Default. Any Credit Party or any Subsidiary thereof shall (i) default
in the payment of any Indebtedness (other than the Loans or any Reimbursement Obligation) the
aggregate outstanding principal amount, or with respect to any Hedge Agreement, the Hedge
Termination Value, of which is in excess of the Threshold Amount beyond the period of grace, if any,
provided in the instrument or agreement under which such Indebtedness was created, or (ii) default in
the observance or performance of any other agreement or condition relating to any Indebtedness (other
than the Loans or any Reimbursement Obligation) the aggregate outstanding principal amount, or with
respect to any Hedge Agreement, the Hedge Termination Value, of which is in excess of the Threshold
Amount or contained in any instrument or agreement evidencing, securing or relating thereto or any
other event shall occur or condition exist, the effect of which default or other event or condition is to
cause, or to permit the holder or holders of such Indebtedness (or a trustee or agent on behalf of such
holder or holders) to cause, with the giving of notice and/or lapse of time, if required, any such
Indebtedness to (A) become due, or to be repurchased, prepaid, defeased or redeemed (automatically
or otherwise), or an offer to repurchase, prepay, defease or redeem such Indebtedness to be made, prior
to its stated maturity (any applicable grace period having expired) or (B) be cash collateralized;
provided that this clause (ii) shall not apply to (x) secured Indebtedness becoming due solely as a
result of the voluntary sale or transfer of the assets securing such Indebtedness, (y) any redemption,
repurchase, conversion or settlement with respect to any Convertible Debt Security pursuant to its
terms unless such redemption, repurchase, conversion or settlement results from a default thereunder,
or (z) any early payment requirement or unwinding or termination with respect to any Permitted Call
Spread Agreement or any Forward Agreement permitted to be entered into pursuant to Section 9.6
hereof.
(g) [Reserved].
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(h) Change in Control. Any Change in Control shall occur.
(i) Voluntary Bankruptcy Proceeding. Any Credit Party or any Material Subsidiary thereof
shall (i) commence a voluntary case under any Debtor Relief Laws, (ii) file a petition seeking to take
advantage of any Debtor Relief Laws, (iii) consent to or fail to contest in a timely and appropriate
manner any petition filed against it in an involuntary case under any Debtor Relief Laws, (iv) apply for
or consent to, or fail to contest in a timely and appropriate manner, the appointment of, or the taking of
possession by, a receiver, custodian, trustee, or liquidator of itself or of a substantial part of its
property, domestic or foreign, (v) admit in writing its inability to pay its debts as they become due,
(vi) make a general assignment for the benefit of creditors, or (vii) take any corporate action for the
purpose of authorizing any of the foregoing.
(j) Involuntary Bankruptcy Proceeding. A case or other proceeding shall be commenced
against any Credit Party or any Material Subsidiary thereof in any court of competent jurisdiction
seeking (i) relief under any Debtor Relief Laws, or (ii) the appointment of a trustee, receiver,
custodian, liquidator or the like for any Credit Party or any Material Subsidiary thereof or for all or any
substantial part of their respective assets, domestic or foreign, and such case or proceeding shall
continue without dismissal or stay for a period of sixty (60) consecutive days, or an order granting the
relief requested in such case or proceeding (including, but not limited to, an order for relief under such
federal bankruptcy laws) shall be entered.
(k) Failure of Agreements. Any provision of this Agreement or any provision of any other
Loan Document shall for any reason cease to be valid and binding on any Credit Party party thereto or
any such Person shall so state in writing other than in accordance with the express terms hereof or
thereof.
(l) ERISA Events. The occurrence of any of the following events: (i) any Credit Party or
any ERISA Affiliate fails to make full payment when due of all amounts which, under the provisions
of any Pension Plan or Sections 412 or 430 of the Code, any Credit Party or any ERISA Affiliate is
required to pay as contributions thereto and such unpaid amounts are in excess of the Threshold
Amount, (ii) a Termination Event, or (iii) any Credit Party or any ERISA Affiliate makes a complete
or partial withdrawal from any Multiemployer Plan and incurs withdrawal liability requiring payments
in an aggregate amount exceeding the Threshold Amount.
(m) Judgment. One or more judgments, orders or decrees shall be entered against any Credit
Party or any Subsidiary thereof by any court and continues without having been discharged, vacated or
stayed for a period of thirty (30) consecutive days after the entry thereof and such judgments, orders or
decrees are for the payment of money, individually or in the aggregate (not paid or fully covered by
insurance as to which the relevant insurance company has acknowledged coverage), equal to or in
excess of the Threshold Amount.
SECTION 10.2 Remedies. Upon the occurrence and during the continuance of an Event of
Default, the Lender may, by notice to the Borrower:
(a) Acceleration; Termination of Revolving Credit Facility. Terminate the Revolving Credit
Commitment and declare the principal of and interest on the Loans and the Reimbursement
Obligations at the time outstanding, and all other amounts owed to the Lender under this Agreement or
any of the other Loan Documents and all other Obligations, to be forthwith due and payable,
whereupon the same shall immediately become due and payable without presentment, demand, protest
or other notice of any kind, all of which are expressly waived by each Credit Party to the extent
permitted by Applicable Law, anything in this Agreement or the other Loan Documents to the contrary
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notwithstanding, and terminate the Revolving Credit Facility and any right of the Borrower to request
borrowings or Letters of Credit thereunder; provided, that upon the occurrence of an Event of Default
specified in Section 10.1(i) or (j), the Revolving Credit Facility shall be automatically terminated and
all Obligations shall automatically become due and payable without presentment, demand, protest or
other notice of any kind, all of which are expressly waived by each Credit Party to the extent permitted
by Applicable Law, anything in this Agreement or in any other Loan Document to the contrary
notwithstanding.
(b) Letters of Credit. With respect to all Letters of Credit with respect to which presentment
for honor shall not have occurred at the time of an acceleration pursuant to the preceding paragraph,
demand that the Borrower deposit in a Cash Collateral account opened by the Lender an amount equal
to the Minimum Collateral Amount. Amounts held in such Cash Collateral account shall be applied by
the Lender to the payment of drafts drawn under such Letters of Credit, and the unused portion thereof
after all such Letters of Credit shall have expired or been fully drawn upon, if any, shall be applied to
repay the other Obligations in accordance with Section 10.3. After all such Letters of Credit shall have
expired or been fully drawn upon, the Reimbursement Obligation shall have been satisfied and all
other Obligations (other than contingent indemnification obligations, Tax gross up, expense
reimbursement or yield protection obligations and obligations under any Hedge Agreement or any
Cash Management Agreement, in each case not then due) shall have been paid in full, the balance, if
any, in such Cash Collateral account shall be returned promptly to the Borrower.
(c) General Remedies. Exercise all of its other rights and remedies under this Agreement,
the other Loan Documents and Applicable Law, in order to satisfy all of the Obligations.
SECTION 10.3 Rights and Remedies Cumulative; Non-Waiver; etc.
(a) The enumeration of the rights and remedies of the Lender set forth in this Agreement is
not intended to be exhaustive and the exercise by the Lender of any right or remedy shall not preclude
the exercise of any other rights or remedies, all of which shall be cumulative, and shall be in addition
to any other right or remedy given hereunder or under the other Loan Documents or that may now or
hereafter exist at law or in equity or by suit or otherwise. No delay or failure to take action on the part
of the Lender in exercising any right, power or privilege shall operate as a waiver thereof, nor shall any
single or partial exercise of any such right, power or privilege preclude any other or further exercise
thereof or the exercise of any other right, power or privilege or shall be construed to be a waiver of any
Event of Default. No course of dealing between the Borrower and the Lender or their respective
agents or employees shall be effective to change, modify or discharge any provision of this Agreement
or any of the other Loan Documents or to constitute a waiver of any Event of Default.
(b) Notwithstanding anything to the contrary contained herein or in any other Loan
Document, the authority to enforce rights and remedies hereunder and under the other Loan
Documents against the Credit Parties or any of them shall be vested exclusively in, and all actions and
proceedings at law in connection with such enforcement shall be instituted and maintained exclusively
by, the Lender in accordance with Section 10.2.
SECTION 10.4 Crediting of Payments and Proceeds. In the event that the Obligations have
been accelerated pursuant to Section 10.2 or the Lender has exercised any remedy set forth in this
Agreement or any other Loan Document, all payments received on account of the Obligations and all
net proceeds from the enforcement of the Obligations shall, subject to the provisions of Sections 3.11,
and 5.15, be applied by the Lender as follows:
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First, to payment of that portion of the Obligations constituting fees (other than Commitment
Fees and Letter of Credit fees payable to the Lender), indemnities and other amounts (other than principal
and interest) payable to the Lender under this Agreement and the other Loan Documents, including
attorney fees;
Second, to payment of that portion of the Obligations constituting accrued and unpaid
Commitment Fees, Letter of Credit fees payable to the Lender and interest on the Loans and
Reimbursement Obligations;
Third, to payment of that portion of the Obligations constituting unpaid principal of the Loans
and Reimbursement Obligations;
Fourth, to the Lender to Cash Collateralize any L/C Obligations then outstanding; and
Last, the balance, if any, after all of the Obligations (other than contingent indemnification
obligations, Tax gross up, expense reimbursement or yield protection obligations and obligations under
any Hedge Agreement or any Cash Management Agreement, in each case not then due) have been paid in
full, to the Borrower or as otherwise required by Applicable Law.
ARTICLE XI
[RESERVED]
ARTICLE XII
MISCELLANEOUS
SECTION 12.1 Notices.
(a) Notices Generally. Except in the case of notices and other communications expressly
permitted to be given by telephone (and except as provided in paragraph (b) below), all notices and
other communications provided for herein shall be in writing and shall be delivered by hand or
overnight courier service, mailed by certified or registered mail or sent by facsimile as follows:
If to the Borrower:
Align Technology, Inc.
Attention of: Jenee Ortiz
Telephone No.: (408) 470-1185
Facsimile No.: (408) 789-1632
E-mail: jeortiz@aligntech.com
With copies to:
Wilson Sonsini Goodrich & Rosati, P.C.
650 Page Mill Road
Palo Alto, CA 94304
Attention of: Kathleen D. Rothman
Telephone No.: (650) 493-9300
Facsimile No.: (650) 493-6811
E-mail: krothman@wsgr.com
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If to the Lender:
Wells Fargo Bank, National Association
MAC: R4057-01R
7711 Plantation Road, 1st Floor
Roanoke, Virginia 24019
Telephone No.: (540) 561-7087
Attention: Loan Documentation
With copies to:
Wells Fargo Bank, National Association
Attention of: Andrea Chen
301 South College Street, 14th Floor
Charlotte, NC 28202
MAC: D1053-150
Notices sent by hand or overnight courier service, or mailed by certified or registered mail, shall be
deemed to have been given when received; notices sent by facsimile shall be deemed to have been given
when sent (except that, if not given during normal business hours for the recipient, shall be deemed to
have been given at the opening of business on the next business day for the recipient). Notices delivered
through electronic communications to the extent provided in paragraph (b) below, shall be effective as
provided in said paragraph (b).
(b) Electronic Communications. Notices and other communications to the Lender hereunder
may be delivered or furnished by electronic communication (including e-mail and Internet or intranet
websites) pursuant to procedures approved by the Lender. The Lender or the Borrower may, in its
discretion, agree to accept notices and other communications to it hereunder by electronic
communications pursuant to procedures approved by it, provided that approval of such procedures
may be limited to particular notices or communications. Unless the Lender otherwise prescribes,
(i) notices and other communications sent to an e-mail address shall be deemed received upon the
sender’s receipt of an acknowledgement from the intended recipient (such as by the “return receipt
requested” function, as available, return e-mail or other written acknowledgement), and (ii) notices or
communications posted to an Internet or intranet website shall be deemed received upon the deemed
receipt by the intended recipient at its e-mail address as described in the foregoing clause (i) of
notification that such notice or communication is available and identifying the website address
therefor; provided that, for both clauses (i) and (ii) above, if such notice, email or other communication
is not sent during the normal business hours of the recipient, such notice, email or other
communication shall be deemed to have been sent at the opening of business on the next business day
for the recipient.
(c) Lender’s Office. The Lender hereby designates its office located at the address set forth
above, or any subsequent office which shall have been specified for such purpose by written notice to
the Borrower, as the Lender’s Office referred to herein, to which payments due are to be made and at
which Loans will be disbursed and Letters of Credit requested.
(d) Change of Address, Etc. Each of the Borrower and the Lender may change its address or
facsimile number for notices and other communications hereunder by notice to the other parties hereto.
SECTION 12.2 Amendments, Waivers and Consents. No amendment or waiver of any
provision of this Agreement or any other Loan Document, and no consent to any departure by the
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Borrower or any other Credit Party therefrom, shall be effective unless in writing signed by the Lender
and the Borrower or the applicable Credit Party, as the case may be, and each such waiver or consent
shall be effective only in the specific instance and for the specific purpose for which given.
SECTION 12.3 Expenses; Indemnity.
(a) Costs and Expenses. The Borrower and any other Credit Party, jointly and severally,
shall pay (i) all reasonable and documented out of pocket expenses incurred by the Lender and its
Affiliates (including the reasonable fees, charges and disbursements of counsel for the Lender), and
shall pay all reasonable and documented fees and time charges and disbursements for attorneys who
may be employees of the Lender, in connection with the preparation, negotiation, execution, delivery
and administration of this Agreement and the other Loan Documents or any amendments,
modifications or waivers of the provisions hereof or thereof (whether or not the transactions
contemplated hereby or thereby shall be consummated), (ii) all reasonable and documented out of
pocket expenses incurred by the Lender in connection with the issuance, amendment, renewal or
extension of any Letter of Credit or any demand for payment thereunder and (iii) all out of pocket
expenses incurred by the Lender (including the fees, charges and disbursements of any counsel for the
Lender), and shall pay all fees and time charges for attorneys who may be employees of the Lender, in
connection with the enforcement or protection of its rights (A) in connection with this Agreement and
the other Loan Documents, including its rights under this Section, or (B) in connection with the Loans
made or Letters of Credit issued hereunder, including all such out of pocket expenses incurred during
any workout, restructuring or negotiations in respect of such Loans or Letters of Credit.
(b) Indemnification by the Borrower. The Borrower shall indemnify the Lender and each
Related Party of the Lender (each such Person being called an “Indemnitee”) against, and hold each
Indemnitee harmless from, and shall pay or reimburse any such Indemnitee for, any and all losses,
claims (including, without limitation, any Environmental Claims), penalties, damages, liabilities and
related expenses (including the reasonable and documented fees, charges and disbursements of any
counsel for any Indemnitee), and shall indemnify and hold harmless, each Indemnitee from, and shall
pay or reimburse any such Indemnitee for, all reasonable and documented fees and time charges and
disbursements for attorneys who may be employees of any Indemnitee, incurred by any Indemnitee or
asserted against any Indemnitee by any Person (including the Borrower or any other Credit Party),
arising out of, in connection with, or as a result of (i) the execution or delivery of this Agreement, any
other Loan Document or any agreement or instrument contemplated hereby or thereby, the
performance by the parties hereto of their respective obligations hereunder or thereunder or the
consummation of the transactions contemplated hereby or thereby (including, without limitation, those
on the Closing Date), (ii) any Loan or Letter of Credit or the use or proposed use of the proceeds
therefrom (including any refusal by the Lender to honor a demand for payment under a Letter of Credit
if the documents presented in connection with such demand do not strictly comply with the terms of
such Letter of Credit), (iii) any actual or alleged presence or release of Hazardous Materials on or from
any property owned or operated by any Credit Party or any Subsidiary thereof, or any Environmental
Claim related in any way to any Credit Party or any Subsidiary, (iv) any actual or prospective claim,
litigation, investigation or proceeding relating to any of the foregoing, whether based on contract, tort
or any other theory, whether brought by a third party or by any Credit Party or any Subsidiary thereof,
and regardless of whether any Indemnitee is a party thereto, or (v) any claim (including, without
limitation, any Environmental Claims), investigation, litigation or other proceeding (whether or not the
Lender is a party thereto) and the prosecution and defense thereof, arising out of or in any way
connected with the Loans, this Agreement, any other Loan Document, or any documents contemplated
by or referred to herein or therein or the transactions contemplated hereby or thereby, including
without limitation, reasonable attorneys and consultant’s fees, provided that such indemnity shall not,
as to any Indemnitee, be available to the extent that such losses, claims, damages, liabilities or related
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expenses (A) are determined by a court of competent jurisdiction by final and nonappealable judgment
to have resulted from the gross negligence or willful misconduct of such Indemnitee or (B) result from
a claim brought by any Credit Party or any Subsidiary thereof against an Indemnitee for breach in bad
faith of such Indemnitee’s obligations hereunder or under any other Loan Document, if such Credit
Party or such Subsidiary has obtained a final and nonappealable judgment in its favor on such claim as
determined by a court of competent jurisdiction. This Section 12.3(b) shall not apply with respect to
Taxes other than any Taxes that represent losses, claims, damages, etc. arising from any non-Tax
claim.
(c) [Reserved].
(d) Waiver of Consequential Damages, Etc. To the fullest extent permitted by Applicable
Law, the Borrower and each other Credit Party shall not assert, and hereby waives, any claim against
any Indemnitee, on any theory of liability, for special, indirect, consequential or punitive damages (as
opposed to direct or actual damages) arising out of, in connection with, or as a result of, this
Agreement, any other Loan Document or any agreement or instrument contemplated hereby, the
transactions contemplated hereby or thereby, any Loan or Letter of Credit or the use of the proceeds
thereof. No Indemnitee referred to in clause (b) above shall be liable for any damages arising from the
use by unintended recipients of any information or other materials distributed by it through
telecommunications, electronic or other information transmission systems in connection with this
Agreement or the other Loan Documents or the transactions contemplated hereby or thereby unless
such damages are determined by a court of competent jurisdiction by final and nonappealable
judgment to have resulted from the gross negligence or willful misconduct of such Indemnitee.
(e) Payments. All amounts due under this Section shall be payable promptly after demand
therefor.
(f) Survival. Each party’s obligations under this Section shall survive the termination of the
Loan Documents and payment of the obligations hereunder.
SECTION 12.4 Right of Setoff. If an Event of Default shall have occurred and be
continuing, the Lender and each of its Affiliates is hereby authorized at any time and from time to time,
to the fullest extent permitted by Applicable Law, to setoff and apply any and all deposits (general or
special, time or demand, provisional or final, in whatever currency) at any time held and other
obligations (in whatever currency) at any time owing by the Lender or any such Affiliate to or for the
credit or the account of the Borrower or any other Credit Party against any and all of the obligations of
the Borrower or such Credit Party now or hereafter existing under this Agreement or any other Loan
Document to the Lender or any of its Affiliates, irrespective of whether or the Lender or any such
Affiliate shall have made any demand under this Agreement or any other Loan Document and although
such obligations of the Borrower or such Credit Party may be contingent or unmatured or are owed to a
branch or office of the Lender or such Affiliate different from the branch, office or Affiliate holding
such deposit or obligated on such indebtedness. The rights of the Lender and its Affiliates under this
Section are in addition to other rights and remedies (including other rights of setoff) that the Lender or
its Affiliates may have. The Lender agrees to notify the Borrower promptly after any such setoff and
application; provided that the failure to give such notice shall not affect the validity of such setoff and
application. Notwithstanding the provisions of this Section, if at any time the Lender or any of its
Affiliates maintains one or more deposit accounts for the Borrower or any other Credit Party into which
Medicare or Medicaid receivables are deposited, such Person shall waive the right of setoff set forth
herein.
SECTION 12.5 Governing Law; Jurisdiction, Etc.
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(a) Governing Law. This Agreement and the other Loan Documents and any claim,
controversy, dispute or cause of action (whether in contract or tort or otherwise) based upon, arising
out of or relating to this Agreement or any other Loan Document (except, as to any other Loan
Document, as expressly set forth therein) and the transactions contemplated hereby and thereby shall
be governed by, and construed in accordance with, the law of the State of New York.
(b) Submission to Jurisdiction. The Borrower and each other Credit Party irrevocably and
unconditionally agrees that it will not commence any action, litigation or proceeding of any kind or
description, whether in law or equity, whether in contract or in tort or otherwise, against the Lender, or
any Related Party thereof in any way relating to this Agreement or any other Loan Document or the
transactions relating hereto or thereto, in any forum other than the courts of the State of New York
sitting in New York County, and of the United States District Court of the Southern District of New
York, and any appellate court from any thereof, and each of the parties hereto irrevocably and
unconditionally submits to the exclusive jurisdiction of such courts and agrees that all claims in respect
of any such action, litigation or proceeding may be heard and determined in such New York State
court or, to the fullest extent permitted by Applicable Law, in such federal court. Each of the parties
hereto agrees that a final judgment in any such action, litigation 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. Nothing in this Agreement or in any other Loan Document shall affect any right that the Lender
may otherwise have to bring any action or proceeding relating to this Agreement or any other Loan
Document against the Borrower or any other Credit Party or its properties in the courts of any
jurisdiction.
(c) Waiver of Venue. The Borrower and each other Credit Party irrevocably and
unconditionally waives, to the fullest extent permitted by Applicable Law, any objection that it may
now or hereafter have to the laying of venue of any action or proceeding arising out of or relating to
this Agreement or any other Loan Document in any court referred to in paragraph (b) of this Section.
Each of the parties hereto hereby irrevocably waives, to the fullest extent permitted by Applicable
Law, the defense of an inconvenient forum to the maintenance of such action or proceeding in any
such court.
(d) Service of Process. Each party hereto irrevocably consents to service of process in the
manner provided for notices in Section 12.1. Nothing in this Agreement will affect the right of any
party hereto to serve process in any other manner permitted by Applicable Law.
SECTION 12.6 Waiver of Jury Trial.
EACH PARTY HERETO HEREBY IRREVOCABLY WAIVES, TO THE FULLEST
EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY
JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR
RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT OR THE
TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY (WHETHER BASED ON
CONTRACT, TORT OR ANY OTHER THEORY). EACH PARTY HERETO (A) CERTIFIES
THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PERSON HAS
REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PERSON WOULD NOT,
IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B)
ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED
TO ENTER INTO THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS BY, AMONG
OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION.
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SECTION 12.7 Reversal of Payments. To the extent any Credit Party makes a payment or
payments to the Lender or the Lender receives any payment or the Lender exercises its right of setoff,
which payments or proceeds (including any proceeds of such setoff) or any part thereof are
subsequently invalidated, declared to be fraudulent or preferential, set aside and/or required to be repaid
to a trustee, receiver or any other party under any Debtor Relief Law, other Applicable Law or equitable
cause, then, to the extent of such payment or proceeds repaid, the Obligations or part thereof intended to
be satisfied shall be revived and continued in full force and effect as if such payment or proceeds had
not been received by the Lender.
SECTION 12.8 Injunctive Relief. The Borrower recognizes that, in the event the Borrower
fails to perform, observe or discharge any of its obligations or liabilities under this Agreement, any
remedy of law may prove to be inadequate relief to the Lender. Therefore, the Borrower agrees that the
Lender, at the Lender’s option, shall be entitled to temporary and permanent injunctive relief in any
such case without the necessity of proving actual damages.
SECTION 12.9 Successors and Assigns; Participations.
This Agreement is binding on each Credit Party’s and the Lender’s successors and assignees.
The Borrower agrees that it may not assign its rights and obligations under this Agreement without the
Lender’s prior consent. The Lender may sell participations in or, with Borrower’s prior written consent
(unless there is an existing Event of Default), assign this loan, and may exchange information about the
Credit Parties (including, without limitation, any information regarding any hazardous substances) with
actual or potential participants or assignees. If a participation is sold or the loan is assigned, the purchaser
will have the right of set-off against the Borrower.
SECTION 12.10 Treatment of Certain Information; Confidentiality. The Lender agrees to
maintain the confidentiality of the Information (as defined below), except that Information may be
disclosed (a) on a need to know basis to its Affiliates and to its and its Affiliates’ respective Related
Parties in connection with the Revolving Credit Facility, this Agreement, the transactions contemplated
hereby or in connection with marketing of services by such Affiliate or Related Party to the Borrower
or any of its Subsidiaries (it being understood that the Persons to whom such disclosure is made will be
informed of the confidential nature of such Information and instructed to keep such Information
confidential), (b) to the extent required or requested by, or required to be disclosed to, any regulatory or
similar authority purporting to have jurisdiction over such Person or its Related Parties (including any
self-regulatory authority, such as the National Association of Insurance Commissioners) or in
accordance with the Lender’s regulatory compliance policy if the Lender deems such disclosure to be
necessary for the mitigation of claims by those authorities against the Lender or any of its Related
Parties (in which case, the Lender shall use commercially reasonable efforts to, except with respect to
any audit or examination conducted by bank accountants or any governmental bank regulatory authority
exercising examination or regulatory authority, promptly notify the Borrower, in advance, to the extent
practicable and otherwise permitted by Applicable Law), (c) as to the extent required by Applicable
Laws or regulations or in any legal, judicial, administrative proceeding or other compulsory process (in
which case, the Lender shall use commercially reasonable efforts to, except with respect to any audit or
examination conducted by bank accountants or any governmental bank regulatory authority exercising
examination or regulatory authority, promptly notify the Borrower, in advance, to the extent practicable
and otherwise permitted by Applicable Law), (d) to any other party hereto, (e) to the extent necessary in
connection with the exercise of any remedies under this Agreement or under any other Loan Document,
or any action or proceeding relating to this Agreement or any other Loan Document or, or the
enforcement of rights hereunder or thereunder, (f) subject to an agreement containing provisions
substantially the same as those of this Section, to (i) any assignee of or participant in, or any prospective
assignee of or participant in, any of its rights and obligations under this Agreement or (ii) any actual or
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prospective party (or its Related Parties) to any swap, derivative or other transaction under which
payments are to be made by reference to the Borrower and its obligations, this Agreement or payments
hereunder, (g) on a confidential basis to any rating agency in connection with rating the Borrower or its
Subsidiaries or the Revolving Credit Facility, (h) with the consent of the Borrower, (i) deal terms and
other information customarily reported to Thomson Reuters, other bank market data collectors and
similar service providers to the lending industry and service providers to the Lender in connection with
the administration of the Loan Documents, (j) to the extent such Information (i) becomes publicly
available other than as a result of a breach of this Section or (ii) becomes available to the Lender or any
of its Affiliates from a third party that is not, to such Person’s knowledge, subject to confidentiality
obligations to the Borrower, (k) to the extent that such information is independently developed by such
Person so long as such Person has not otherwise breached its confidentiality obligations hereunder and
has not developed such information based on information received from a third party that to its actual
knowledge has breached confidentiality obligations owing to the Borrower or any of its Subsidiaries, or
(l) for purposes of establishing a “due diligence” defense. For purposes of this Section, “Information”
means all information received from any Credit Party or any Subsidiary thereof relating to any Credit
Party or any Subsidiary thereof or any of their respective businesses, other than any such information
that is available to the Lender on a nonconfidential basis prior to disclosure by any Credit Party or any
Subsidiary thereof; provided that, in the case of information received from a Credit Party or any
Subsidiary thereof after the date hereof, such information is clearly identified at the time of delivery as
confidential. Any Person required to maintain the confidentiality of Information as provided in this
Section shall be considered to have complied with its obligation to do so if such Person has exercised
the same degree of care to maintain the confidentiality of such Information as such Person would
accord to its own confidential information.
SECTION 12.11 Performance of Duties. Each of the Credit Party’s obligations under this
Agreement and each of the other Loan Documents shall be performed by such Credit Party at its sole
cost and expense.
SECTION 12.12 All Powers Coupled with Interest. All powers of attorney and other
authorizations granted to the Lender and any Persons designated by the Lender pursuant to any
provisions of this Agreement or any of the other Loan Documents shall be deemed coupled with an
interest and shall be irrevocable so long as any of the Obligations remain unpaid or unsatisfied, any of
the Commitments remain in effect or the Revolving Credit Facility has not been terminated.
SECTION 12.13 Survival.
(a) All representations and warranties set forth in Article VII and all representations and
warranties contained in any certificate, or any of the Loan Documents (including, but not limited to, any
such representation or warranty made in or in connection with any amendment thereto) shall constitute
representations and warranties made under this Agreement. All representations and warranties made
under this Agreement shall be made or deemed to be made at and as of the Closing Date (except those
that are expressly made as of a specific date), shall survive the Closing Date and shall not be waived by
the execution and delivery of this Agreement, any investigation made by or on behalf of the Lender or
any borrowing hereunder.
(b) Notwithstanding any termination of this Agreement, the indemnities to which the Lender
is entitled under the provisions of this Article XII and any other provision of this Agreement and the other
Loan Documents shall continue in full force and effect and shall protect the Lender against events arising
after such termination as well as before.
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SECTION 12.14 Titles and Captions. Titles and captions of Articles, Sections and subsections
in, and the table of contents of, this Agreement are for convenience only, and neither limit nor amplify
the provisions of this Agreement.
SECTION 12.15 Severability of Provisions. Any provision of this Agreement or any other
Loan Document which is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective only to the extent of such prohibition or unenforceability without invalidating the
remainder of such provision or the remaining provisions hereof or thereof or affecting the validity or
enforceability of such provision in any other jurisdiction. In the event that any provision is held to be
so prohibited or unenforceable in any jurisdiction, the Lender and the Borrower shall negotiate in good
faith to amend such provision to preserve the original intent thereof in such jurisdiction.
SECTION 12.16 Counterparts; Integration; Effectiveness.
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. This Agreement and the other Loan Documents, and any separate letter
agreements with respect to fees payable to the Lender, constitute the entire contract among the parties
relating to the subject matter hereof and supersede any and all previous agreements and understandings,
oral or written, relating to the subject matter hereof. This Agreement shall become effective when it shall
have been executed by the Lender and when the Lender shall have received counterparts hereof that,
when taken together, bear the signatures of each of the other parties hereto. Delivery of an executed
counterpart of a signature page of this Agreement by facsimile or in electronic (i.e., “pdf” or “tif”) format
shall be effective as delivery of a manually executed counterpart of this Agreement.
SECTION 12.17 Term of Agreement. This Agreement shall remain in effect from the Closing
Date through and including the date upon which all Obligations (other than contingent indemnification
obligations, Tax gross up, expense reimbursement or yield protection obligations and obligations under
any Hedge Agreement or any Cash Management Agreement, in each case not then due) arising
hereunder or under any other Loan Document shall have been indefeasibly and irrevocably paid and
satisfied in full, all Letters of Credit have been terminated or expired (or been Cash Collateralized) or
otherwise satisfied in a manner acceptable to the Lender) and the Revolving Credit Commitment has
been terminated. No termination of this Agreement shall affect the rights and obligations of the parties
hereto arising prior to such termination or in respect of any provision of this Agreement which survives
such termination.
SECTION 12.18 USA PATRIOT Act; Anti-Money Laundering Laws. The Lender hereby
notifies the Borrower that pursuant to the requirements of the PATRIOT Act or any other Anti-Money
Laundering Laws, it is required to obtain, verify and record information that identifies each Credit
Party, which information includes the name and address of each Credit Party and other information that
will allow the Lender to identify each Credit Party in accordance with the PATRIOT Act or such Anti-
Money Laundering Laws.
SECTION 12.19 Independent Effect of Covenants. The Borrower expressly acknowledges
and agrees that each covenant contained in Articles VIII or IX hereof shall be given independent effect.
Accordingly, the Borrower shall not engage in any transaction or other act otherwise permitted under
any covenant contained in Articles VIII or IX, before or after giving effect to such transaction or act,
the Borrower shall or would be in breach of any other covenant contained in Articles VIII or IX.
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SECTION 12.20 No Advisory or Fiduciary Responsibility.
(a) In connection with all aspects of each transaction contemplated hereby, each Credit Party
acknowledges and agrees that (i) the facilities provided for hereunder and any related arranging or other
services in connection therewith (including in connection with any amendment, waiver or other
modification hereof or of any other Loan Document) are an arm’s-length commercial transaction between
the Borrower and its Subsidiaries, on the one hand, and the Lender, on the other hand, and the Borrower
is capable of evaluating and understanding and understands and accepts the terms, risks and conditions of
the transactions contemplated hereby and by the other Loan Documents (including any amendment,
waiver or other modification hereof or thereof), (ii) in connection with the process leading to such
transaction, the Lender is and has been acting solely as a principal and is not the financial advisor, agent
or fiduciary, for the Borrower or any of its Subsidiaries, stockholders, creditors or employees or any other
Person, (iii) the Lender has not assumed nor will it assume an advisory, agency or fiduciary responsibility
in favor of the Borrower with respect to any of the transactions contemplated hereby or the process
leading thereto, including with respect to any amendment, waiver or other modification hereof or of any
other Loan Document (irrespective of whether the Lender has advised or is currently advising the
Borrower or any of its Affiliates on other matters) and the Lender has no obligation to the Borrower or
any of its Subsidiaries with respect to the financing transactions contemplated hereby except those
obligations expressly set forth herein and in the other Loan Documents, (iv) the Lender and its
Subsidiaries may be engaged in a broad range of transactions that involve interests that differ from, and
may conflict with, those of the Borrower and its Subsidiaries, and the Lender has no obligation to disclose
any of such interests by virtue of any advisory, agency or fiduciary relationship and (v) the Lender has not
provided and will not provide any legal, accounting, regulatory or tax advice with respect to any of the
transactions contemplated hereby (including any amendment, waiver or other modification hereof or of
any other Loan Document) and the Credit Parties have consulted their own legal, accounting, regulatory
and tax advisors to the extent they have deemed appropriate.
(b) Each Credit Party acknowledges and agrees that the Lender and any Affiliate thereof may
lend money to, invest in, and generally engage in any kind of business with, any of the Borrower, any
Affiliate thereof or any other person or entity that may do business with or own securities of any of the
foregoing, all as if the Lender or Affiliate thereof were not the Lender or an Affiliate thereof (or an agent
or any other person with any similar role under the Credit Facilities) and without any duty to account
therefor to the Borrower or any Affiliate thereof.
SECTION 12.21 Inconsistencies with Other Documents. In the event there is a conflict or
inconsistency between this Agreement and any other Loan Document, the terms of this Agreement shall
control.
SECTION 12.22 Acknowledgement and Consent to Bail-In of EEA Financial Institutions.
Notwithstanding anything to the contrary in any Loan Document or in any other agreement,
arrangement or understanding among any such parties, each party hereto acknowledges that any
liability of any EEA Financial Institution arising under any Loan Document, to the extent such liability
is unsecured, may be subject to the Write-Down and Conversion Powers of an EEA Resolution
Authority and agrees and consents to, and acknowledges and agrees to be bound by:
(a) the application of any Write-Down and Conversion Powers by an EEA Resolution
Authority to any such liabilities arising hereunder which may be payable to it by any party hereto that is
an EEA Financial Institution; and
(b) the effects of any Bail-in Action on any such liability, including, if applicable:
85
DMSLIBRARY01\31650438.v9
(i) a reduction in full or in part or cancellation of any such liability;
(ii) a conversion of all, or a portion of, such liability into shares or other instruments
of ownership in such EEA Financial Institution, its parent undertaking, or a bridge institution that
may be issued to it or otherwise conferred on it, and that such shares or other instruments of
ownership will be accepted by it in lieu of any rights with respect to any such liability under this
Agreement or any other Loan Document; or
(iii) the variation of the terms of such liability in connection with the exercise of the
Write-Down and Conversion Powers of any EEA Resolution Authority.
[Signature pages to follow]
DMSLIBRARY01\31688770.v5
EXHIBIT A
[FORM OF]
REVOLVING CREDIT NOTE
[Date]
FOR VALUE RECEIVED, the undersigned, ALIGN TECHNOLOGY, INC., a
Delaware corporation (the “Borrower”), hereby unconditionally promises to pay, on the
Revolving Credit Maturity Date (as defined in the Credit Agreement referred to below), to Wells
Fargo Bank, National Association or its registered assigns (the “Lender”), at the office of Wells
Fargo Bank, National Association, in lawful money of the United States of America and in
immediately available funds, the aggregate unpaid principal amount of all Revolving Credit
Loans made by the Lender to the undersigned pursuant to Section 2.1 of the Credit Agreement
referred to below. The undersigned further agrees to pay interest in like money at such office on
the unpaid principal amount hereof and, to the extent permitted by law, accrued interest in
respect hereof from time to time from the date hereof until payment in full of the principal
amount hereof and accrued interest hereon, at the rates and on the dates set forth in the Credit
Agreement.
This Revolving Credit Note is one of the Revolving Credit Notes referred to in the Credit
Agreement, dated as of February 27, 2018 (as amended, modified, extended, restated, replaced,
or supplemented from time to time, the “Credit Agreement”), by and between the Borrower and
the Lender, and the holder is entitled to the benefits thereof. Capitalized terms used but not
otherwise defined herein shall have the meanings provided in the Credit Agreement.
Upon the occurrence of any one or more of the Events of Default specified in the Credit
Agreement, all amounts then remaining unpaid on this Revolving Credit Note shall become, or
may be declared to be, immediately due and payable, all as provided therein. In the event this
Revolving Credit Note is not paid when due at any stated or accelerated maturity, the Borrower
agrees to pay, in addition to principal and interest, all costs of collection, including reasonable
attorneys’ fees.
All parties now and hereafter liable with respect to this Revolving Credit Note, whether
maker, principal, surety, endorser or otherwise, hereby waive, to the extent permitted by
Applicable Law, presentment, demand, protest and all other notices of any kind.
This Revolving Credit Note may, upon execution, be delivered by facsimile or electronic
mail, which shall be deemed for all purposes to be an original signature.
THIS REVOLVING CREDIT NOTE SHALL BE GOVERNED BY, AND
CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE LAWS OF THE STATE
OF NEW YORK.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
ALIGN TECHNOLOGY, INC.,
a Delaware corporation
By:
Name:
Title:
EXHIBIT B
[FORM OF]
NOTICE OF BORROWING
TO: Wells Fargo Bank, National Association, as Lender
RE: Credit Agreement, dated as of February 27, 2018, by and between Align
Technology, Inc., a Delaware corporation (the “Borrower”), and Wells Fargo
Bank, National Association, as Lender (as amended, modified, extended, restated,
replaced, or supplemented from time to time, the “Credit Agreement”; capitalized
terms used herein and not otherwise defined shall have the meanings set forth in
the Credit Agreement)
DATE: [Date]
Pursuant to Section 2.3(a) of the Credit Agreement, the Borrower hereby requests the
following (the “Proposed Borrowing”):
Revolving Credit Loans be made as follows:
Date
Amount
Interest
Rate
(Base Rate/
LIBOR Rate)
Interest
Period
(one, two, three, six or
twelve months
-- for LIBOR Rate only)
NOTE: REVOLVING CREDIT LOAN BORROWINGS THAT ARE (A) BASE RATE
LOANS MUST BE IN A MINIMUM AGGREGATE AMOUNT OF $3,000,000
AND IN INTEGRAL MULTIPLES OF $1,000,000 IN EXCESS THEREOF
AND (B) LIBOR RATE LOANS MUST BE IN A MINIMUM AGGREGATE
AMOUNT OF $5,000,000 AND IN INTEGRAL MULTIPLES OF $1,000,000 IN
EXCESS THEREOF.
The undersigned hereby certifies that the following statements are true on the date hereof
and will be true on the date of the Proposed Borrowing:
(a) The representations and warranties made by the Credit Parties in the
Credit Agreement and the other Loan Documents or which are contained in any
certificate furnished at any time under or in connection with the Credit Agreement shall
be true and correct in all material respects, except for any representation and warranty
that is qualified by materiality or reference to Material Adverse Effect, which such
representation and warranty shall be true and correct in all respects, on and as of such
borrowing, issuance or extension date with the same effect as if made on and as of such
date (except for any such representation and warranty that by its terms is made only as of
an earlier date, which representation and warranty shall remain true and correct in all
material respects as of such earlier date, except for any representation and warranty that
is qualified by materiality or reference to Material Adverse Effect, which such
representation and warranty shall be true and correct in all respects as of such earlier
date).
(b) No Default or Event of Default shall have occurred and be continuing on
the date of the Proposed Borrowing or after giving effect to the Proposed Borrowing
unless such Default or Event of Default shall have been waived in accordance with the
Credit Agreement.
This Notice of Borrowing may, upon execution, be delivered by facsimile or electronic
mail, which shall be deemed for all purposes to be an original signature.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
ALIGN TECHNOLOGY, INC.
a Delaware corporation
By:
Name:
Title:
EXHIBIT C
[FORM OF]
NOTICE OF ACCOUNT DESIGNATION NOTICE
TO: Wells Fargo Bank, National Association, as Lender
RE: Credit Agreement, dated as of February 27, 2018 by and between Align
Technology, Inc., a Delaware corporation (the “Borrower”), and Wells Fargo
Bank, National Association, as Lender (as amended, modified, extended, restated,
replaced, or supplemented from time to time, the “Credit Agreement”; capitalized
terms used herein and not otherwise defined shall have the meanings set forth in
the Credit Agreement)
DATE: [Date]
The Lender is hereby authorized to disburse all Loan proceeds into the following account,
unless the Borrower shall designate, in writing to the Lender, one or more other accounts:
Bank Name: [______________________]
ABA Routing Number: [_______]
Account Number: [__________]
[TO BE COMPLETED BY BORROWER]
Notwithstanding the foregoing, on the Closing Date, funds borrowed under the Credit
Agreement shall be sent to the institutions and/or persons designated on payment instructions to
be delivered separately.
This Account Designation Notice may, upon execution, be delivered by facsimile or
electronic mail, which shall be deemed for all purposes to be an original signature.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
ALIGN TECHNOLOGY, INC.
a Delaware corporation
By:
Name:
Title:
EXHIBIT D
[FORM OF]
NOTICE OF PREPAYMENT
[Date]
TO: Wells Fargo Bank, National Association, as Lender
Re: Credit Agreement, dated as of February 27, 2018, by and between Align
Technology, Inc., a Delaware corporation, as Borrower and Wells Fargo Bank,
National Association, as Lender (as amended, modified, extended, restated,
replaced, or supplemented from time to time, the “Credit Agreement”)
Ladies and Gentlemen:
Reference is hereby made to the Credit Agreement. Capitalized terms not defined
herein shall have the meanings ascribed thereto in the Credit Agreement.
This letter shall constitute written notice to the Administrative Agent pursuant to
Section 2.4(c) of the Credit Agreement of the Borrower’s intent to prepay the Revolving Credit
Loan listed below in the amount corresponding to such Loan[s] on the corresponding date listed
below (the “Scheduled Prepayment Date”).
Scheduled Prepayment
Date
Amount
Interest
Rate
(Base Rate/
LIBOR Rate)
NOTE: PARTIAL PREPAYMENTS SHALL BE IN AN AGGREGATE AMOUNT OF
(A) $3,000,000 OR A WHOLE MULTIPLE OF $1,000,000 IN EXCESS
THEREOF WITH RESPECT TO REVOLVING CREDIT LOANS THAT ARE
BASE RATE LOANS AND (B) $5,000,000 OR A WHOLE MULTIPLE OF
$1,000,000 IN EXCESS THEREOF WITH RESPECT TO REVOLVING
CREDIT LOANS THAT ARE LIBOR RATE LOANS.
[This letter is delivered in connection with [the refinancing of all of the Revolving
Credit Facility with the proceeds of such refinancing] [the incurrence of Indebtedness] [specify
event of condition], and is contingent upon the consummation of such [refinancing] [incurrence]
[occurrence of such event or condition] and may be revoked by the Borrower in the event such
contingency is not met (provided that the failure of such contingency shall not relieve the
Borrower from its obligations in respect thereof under Section 5.9 of the Credit Agreement).]
Notwithstanding the foregoing, this letter shall not be construed as a waiver of
any rights of the Borrower or any of the other Credit Parties under the Credit Agreement and the
other Loan Documents.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
Sincerely,
ALIGN TECHNOLOGY, INC.,
a Delaware corporation
By:
Name:
Title:
EXHIBIT E
[FORM OF]
NOTICE OF CONVERSION/CONTINUATION
TO: Wells Fargo Bank, National Association, as Lender
RE: Credit Agreement, dated as of February 27, 2018, by and between Align
Technology, Inc., Delaware corporation (the “Borrower”), and Wells Fargo Bank,
National Association, as Lender (as amended, modified, extended, restated,
replaced, or supplemented from time to time, the “Credit Agreement”; capitalized
terms used herein and not otherwise defined shall have the meanings set forth in
the Credit Agreement)
DATE: [Date]
Pursuant to Section 5.2 of the Credit Agreement, the Borrower hereby requests ____
conversion or ____ continuation of the following Loans be made as follows (the “Proposed
Conversion/Continuation”):
Applicable
Loan
Current
Interest
Rate and
Interest
Period
Date of
Conversion/
Continuation
Amount to
be
converted/
continued
Requested
Interest
Rate
(Base
Rate/LIBOR
Rate)
Requested Interest
Period
(one, two, three, six
or twelve months
-- for LIBOR Rate
only)
NOTE: CONVERSIONS OF (A) ALL OR ANY PORTION OF ANY
OUTSTANDING BASE RATE LOANS INTO ONE OR MORE LIBOR
RATE LOANS MUST BE IN A MINIMUM PRINCIPAL AMOUNT OF
$5,000,000 OR A WHOLE MULTIPLE OF $1,000,000 IN EXCESS
THEREOF AND (B) ALL OR ANY PART OF THE OUTSTANDING
LIBOR RATE LOANS INTO BASE RATE LOANS MUST BE IN A
MINIMUM PRINCIPAL AMOUNT OF $3,000,000 OR A WHOLE
MULTIPLE OF $1,000,000 IN EXCESS THEREOF.
Capitalized terms used herein and not otherwise defined shall have the meanings set forth
in the Credit Agreement.
[The undersigned hereby certifies that no Default or Event of Default has occurred and is
continuing on the date of the Proposed Conversion/Continuation or after giving effect to the
Loans to be [continued as]/[converted to] LIBOR Rate Loans on the date of the Proposed
Conversion/Continuation.]1
This Notice of Conversion/Continuation may, upon execution, be delivered by facsimile
or electronic mail, which shall be deemed for all purposes to be an original signature.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
1 Include if converting to a LIBOR Rate Loan or continuing a LIBOR Rate Loan.
ALIGN TECHNOLOGY, INC.,
a Delaware corporation
By:
Name:
Title:
EXHIBIT F
[FORM OF]
OFFICER’S COMPLIANCE CERTIFICATE
TO: Wells Fargo Bank, National Association, as Lender
RE: Credit Agreement, dated as of February 27, 2018, by and between Align
Technology, Inc., a Delaware corporation (the “Borrower”), and Wells Fargo
Bank, National Association, as Lender (as amended, modified, extended, restated,
replaced, or supplemented from time to time, the “Credit Agreement”; capitalized
terms used herein and not otherwise defined shall have the meanings set forth in
the Credit Agreement)
DATE: [Date]
For the fiscal [quarter] [year] ended [_________________, _____].
The undersigned hereby certifies on behalf of the Credit Parties that, to the best of his/her
knowledge, with respect to the Credit Agreement:
[(a) [Attached hereto on Exhibit A] [Included in the Borrower’s Annual Report
on Form 10-K filed with the SEC on ___] is an audited Consolidated balance sheet of the
Borrower and its Subsidiaries as of the close of the Fiscal Year ended [___] and audited
Consolidated statements of income, retained earnings and cash flows including the notes
thereto, accompanied by a report or opinion prepared by such certified public accounting
firm pursuant to the requirements of Section 8.1(a) of the Credit Agreement. 1
Or
[Attached hereto as Exhibit A][Included in the Borrower’s Quarterly
Report on Form 10-Q filed with the SEC on ___] is a Consolidated balance sheet of the
Borrower and its Subsidiaries as of the close of the fiscal quarter ended [___] and
Consolidated statements of income and cash flows and a report containing management’s
discussion and analysis of such financial statements for the fiscal quarter ended [__] and
that portion of the Fiscal Year then ended, including the notes thereto.]2
(b) The financial statements delivered for the fiscal period referred to above
present fairly in all material respects the financial position of the Borrower and its
1 To be provided annually.
2 To be provided after the end of the first three fiscal quarters of each Fiscal Year.
Subsidiaries, for the period indicated above, in conformity with GAAP applied on a
consistent basis, [subject to normal year-end adjustments and the absence of footnotes]3.
(c) Each of the Credit Parties during the period indicated above observed or
performed all of its covenants and other agreements, and satisfied every condition,
contained in the Credit Agreement to be observed, performed or satisfied by it.
(d) I have obtained no knowledge of any Default or Event of Default under
the Credit Agreement;4
(e) [Attached hereto on Schedule A are calculations in reasonable detail
demonstrating compliance by the Credit Parties with the financial covenants contained in
Section 9.15 of the Credit Agreement as of the last day of the fiscal period referred to
above.]5
This Certificate may, upon execution, be delivered by facsimile or electronic mail, which
shall be deemed for all purposes to be an original signature.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
3 Include if provided after the end of the first three fiscal quarters of Each Fiscal Year.
4 If a Default or Event of Default shall have occurred, an explanation of such Default or Event of Default shall be
provided on a separate page attached hereto together with an explanation of the action taken or proposed to be taken
by the Borrower with respect thereto.
5 To be provided if required pursuant to clause (e) of the definition of Permitted Acquisition.
ALIGN TECHNOLOGY, INC.,
a Delaware corporation
By:
Name:
Title:
[Exhibit A
Balance Sheets]
See Attached
Schedule A
Financial Covenant Calculations
[TO BE COMPLETED BY BORROWER]