Exhibit 10.1

January 25, 2007

 

St. Jude Medical, Inc.

One Lillehei Plaza

St. Paul, MN 55117

Attention: Chief Financial Officer

 

Re:

$700,000,000 Interim Liquidity Facility

Ladies and Gentlemen:

 

BANK OF AMERICA, N.A. (the “Lender” or, if any assignment is effective pursuant
to Section 6(e) hereof, the “Initial Lender”) is pleased to make available to
ST. JUDE MEDICAL, INC., a Minnesota corporation (“St. Jude” or the “Borrower”),
a senior credit facility on the terms and subject to the conditions set forth
below. Terms not defined herein have the meanings assigned to them in Exhibit A
hereto.

 

1.

The Facility.

 

 

(a)

The Commitment. Subject to the terms and conditions set forth herein, the Lender
agrees to make available to the Borrower until the Maturity Date a credit
facility providing for loans (“Loans”) in Dollars in an aggregate initial
principal amount not to exceed $700,000,000, as reduced in accordance with
Section 1(h) hereof (the “Commitment”). No amount of any Loan repaid or prepaid
by the Borrower may be reborrowed hereunder.

 

 

(b)

Borrowings, Conversions, Continuations. The Borrower may request that Loans be
(i) made as or converted to Base Rate Loans by irrevocable notice to be received
by the Lender not later than 12:00 P.M. on the Business Day prior to the
Business Day of the borrowing or conversion, or (ii) so long as no Default or
Event of Default shall have occurred and be continuing, made or continued as, or
converted to, Eurodollar Rate Loans by irrevocable notice to be received by the
Lender not later than 12:00 P.M. three Business Days prior to the Business Day
of the borrowing, continuation or conversion. If the Borrower fails to give a
notice of conversion or continuation prior to the end of any Interest Period in
respect of any Eurodollar Rate Loan, the Borrower shall be deemed to have
requested that such Loan be converted to a Base Rate Loan on the last day of the
applicable Interest Period. If the Borrower requests that a Loan be continued as
or converted to a Eurodollar Rate Loan, but fails to specify an Interest Period
with respect thereto, the Borrower shall be deemed to have selected an Interest
Period of one month. Notices pursuant to this Section 1(b) may be given by
telephone if promptly confirmed in writing (but the failure to provide such
written confirmation shall not affect the validity of any such notice).

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St. Jude Medical, Inc.

January 25, 2007

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Each Eurodollar Rate Loan shall be in a principal amount of $10,000,000 or a
whole multiple of $5,000,000 in excess thereof. Each Base Rate Loan shall be in
a principal amount of $5,000,000 or a whole multiple of $1,000,000 in excess
thereof. There shall not be more than four (4) different Interest Periods in
effect at any time.

 

 

(c)

Interest. At the option of the Borrower, Loans shall bear interest at a rate per
annum equal to (i) the Eurodollar Rate for any such Interest Period plus the
Applicable Margin; or (ii) the Base Rate. Interest on Base Rate Loans calculated
by reference to the Bank of America “prime rate” shall be calculated on the
basis of a year of 365 or 366 days and actual days elapsed. All other interest
hereunder shall be calculated on the basis of a year of 360 days and actual days
elapsed.

 

The Borrower promises to pay interest (i) for each Eurodollar Rate Loan, (A) on
the last day of the applicable Interest Period, and (B) on the date of any
conversion of such Loan to a Base Rate Loan; (ii) for Base Rate Loans, on the
last Business Day of each calendar quarter; and (iii) for all Loans, on the
Maturity Date. If the time for any payment is extended by operation of law or
otherwise, interest shall continue to accrue for such extended period. After the
occurrence and during the continuance of any Event of Default, the Borrower
shall pay, but only to the extent permitted by law, interest (after as well as
before judgment) on such amounts at a rate per annum equal to the Default Rate.
Such interest shall be payable on demand. In no case shall interest hereunder
exceed the amount that the Lender may charge or collect under applicable law.

 

 

(d)

Evidence of Loans. The Loans and all payments thereon shall be evidenced by the
Lender’s loan accounts and records and by a promissory note in the form of
Exhibit B hereto in addition to such loan accounts and records. Such loan
accounts, records and promissory note shall be prima facie evidence of the
amount of the Loans and payments thereon. Any failure to record any Loan or
payment thereon or any error in doing so shall not limit or otherwise affect the
obligation of the Borrower to pay any amount owing with respect to the Loans.

 

 

(e)

Repayment. The Borrower promises to pay all Loans then outstanding on the
Maturity Date.

 

The Borrower shall make all payments required hereunder not later than 2:00 P.M.
on the date of payment in same day funds in Dollars at the office of the Lender
located at 101 North Tryon Street, 15th Floor, Charlotte, North Carolina 28255
or such other address as the Lender may from time to time designate in writing,
including in documents delivered in connection with an assignment pursuant to
Section 6(e).

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St. Jude Medical, Inc.

January 25, 2007

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All payments to be made by the Borrower to the Lender shall be made without
condition or deduction for any counterclaim, defense, recoupment or setoff. Such
payments shall be free and clear of and exempt from, and without deduction or
withholding for or on account of, any present or future taxes, levies, imposts,
duties or charges of whatsoever nature imposed by any government or any
political subdivision or taxing authority thereof. The Borrower shall reimburse
the Lender for any taxes imposed on or withheld from such payments (other than
taxes imposed on the Lender’s income, and franchise taxes imposed on the Lender,
by the jurisdiction under the laws of which the Lender is organized or any
political subdivision thereof).

 

 

(f)

Voluntary Prepayments. The Borrower may, upon two Business Days’ notice in the
case of Eurodollar Rate Loans, and upon same-day notice in the case of Base Rate
Loans, voluntarily prepay Loans on any Business Day. Prepayments of Loans must
be accompanied by a payment of accrued interest on the amount so prepaid.
Prepayments must be in a principal amount of $5,000,000 or a whole multiple of
$1,000,000 in excess thereof or the entire remaining principal amount of Loans.

 

 

(g)

Mandatory Prepayments. (i) If at any time the aggregate outstanding principal
amount of all Loans shall exceed the Commitment, the Borrower shall make a
prepayment in the amount necessary to cause the aggregate outstanding principal
amount of all Loans to be less than or equal to the Commitment. If such
prepayments are required in connection with a Commitment reduction which
occurred as the result of the closing of the Senior Credit Refinancing as
described in Section 1(h)(iii) or (iv), each such prepayment shall be made
simultaneously with the receipt of the initial advance made on the date of
closing of the Senior Credit Refinancing.

 

(ii)           In the event that the aggregate amount of all Net Cash Proceeds
from all dispositions of assets of the Borrower or any Subsidiary after the
Closing Date exceeds $50,000,000, excluding dispositions of assets permitted
pursuant to Sections 7.02(a), 7.02(b) and 7.02(d) of the Incorporated Agreement,
the Borrower shall make a prepayment in an amount equal to the lesser of (x) the
aggregate outstanding principal amount of all Loans and accrued interest thereon
and (y) one hundred percent (100%) of the Net Cash Proceeds of all such
dispositions, each such prepayment to be made within ten days of receipt of the
Net Cash Proceeds thereof and upon not less than five Business Days’ prior
written notice to the Lender, which notice shall include a certificate of a
Responsible Officer of the Borrower setting forth in reasonable detail the
calculations utilized in computing the Net Cash Proceeds of such sale and the
amount of such prepayment.

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St. Jude Medical, Inc.

January 25, 2007

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(iii)         In the event that the aggregate amount of all Net Cash Proceeds
from all Debt Issuances after the Closing Date exceeds $50,000,000, excluding
extensions of credit permitted pursuant to Section 7.04(c) of the Incorporated
Agreement, the Borrower shall make a prepayment in an amount equal to the lesser
of (x) the aggregate outstanding principal amount of all Loans and accrued
interest thereon and (y) one hundred percent (100%) of the Net Cash Proceeds of
all such Debt Issuances, each such prepayment to be made within ten Business
Days of receipt of such proceeds and upon not less than five Business Days’
prior written notice to the Lender, which notice shall include a certificate of
a Responsible Officer of the Borrower setting forth the initial principal amount
of such Debt Issuance.

 

(iv)         In the event that the aggregate amount of all Net Cash Proceeds
from all Equity Issuances after the Closing Date exceeds $50,000,000, the
Borrower shall make a prepayment in an amount equal to the lesser of (x) the
aggregate outstanding principal amount of all Loans and accrued interest thereon
and (y) one hundred percent (100%) of the Net Cash Proceeds of all such Equity
Issuances, each such prepayment to be made within ten Business Days of receipt
of such proceeds and upon not less than five Business Days’ prior written notice
to the Lender, which notice shall include a certificate of a Responsible Officer
of the Borrower setting forth in reasonable detail the calculations utilized in
computing the Net Cash Proceeds of such Equity Issuance and the amount of such
prepayment.

 

 

(h)

Commitment Reductions. (i) The Borrower may, upon three Business Days’ notice,
reduce or cancel any undrawn portion of the Commitment, provided, that the
amount of such reduction is not less than $5,000,000 or a whole multiple of
$1,000,000 in excess thereof.

 

(ii)          Subject to clauses (iii) and (iv) below, the Commitment shall be
permanently reduced on a dollar for dollar basis on the date any prepayment is
or would be required by Section 1(g) by the amount of funds available to be
applied for such repayment of Loans regardless of the then outstanding principal
amount of Loans.

 

(iii)        The Commitment shall be permanently reduced on a dollar for dollar
basis on the date of the closing of an event described in clause (i) of the
definition of Senior Credit Refinancing.

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St. Jude Medical, Inc.

January 25, 2007

Page 5

 

 

(iv)         The Commitment shall be permanently reduced to zero and terminated
on the date of the closing of an event described in clause (ii) of the
definition of Senior Credit Refinancing.

 

 

(i)

Utilization Fee. The Borrower shall pay to the Lender a utilization fee equal to
0.050% times the aggregate outstanding principal amount of all Loans (the
“Outstanding Amount”) on each day that the Outstanding Amount (after giving
effect to any borrowings and prepayments or repayments of Loans occurring on
such date) exceeds $350,000,000. The utilization fee shall be due and payable
monthly in arrears on the last Business Day of each month, commencing with the
first such date to occur after the Closing Date, and on the Maturity Date (and,
if applicable, thereafter on demand). The utilization fee shall be calculated
monthly in arrears. The utilization fee shall accrue at all times when the
Outstanding Amount exceeds $350,000,000, including at any time during which one
or more of the conditions in Section 2 is not met.

 

(j)

Taxes, Yield Protections, Illegality, Breakage Costs and Reserve on Eurodollar
Rate Loans. The provisions of Sections 3.01 through 3.07 of the Incorporated
Agreement shall apply to this Agreement and the Loans hereunder, and such
Sections (including all exhibits, schedules and defined terms referred to
therein) are hereby incorporated herein by reference and the Borrower shall
fully comply therewith as if set forth in full herein with appropriate
substitutions.

 

2.

Conditions of Effectiveness and Conditions Precedent to Loans.

 

(a)

Conditions of Effectiveness and Conditions Precedent to Initial Loan. As a
condition precedent to the effectiveness of this Agreement and the obligation of
the Lender to make any Loan on the Closing Date hereunder, the Lender must
receive the following from the Borrower in form and substance satisfactory to
the Lender:

 

(i)

the enclosed duplicate of this Agreement duly executed and delivered on behalf
of the Borrower;

 

 

(ii)

a promissory note duly executed and delivered by the Borrower as contemplated in
Section 1(d) above;

 

 

(iii)

an opinion or opinions of counsel to the Borrower, substantially in the form of
legal opinions delivered in connection with the closing of the Incorporated
Agreement by counsel to the Borrower;

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St. Jude Medical, Inc.

January 25, 2007

Page 6

 

 

 

(iv)

certificates of resolutions or other action, signature and incumbency
certificates and/or other certificates of a Responsible Officer, which establish
the identity and verify the authority and capacity of the Responsible Officer
authorized to act on behalf of the Borrower and as a Responsible Officer in
connection with this Agreement and the other Loan Documents;

 

 

(v)

the Organizational Documents of the Borrower certified as true and correct by
its secretary or assistant secretary;

 

 

(vi)

a certificate signed by a Responsible Officer on behalf of the Borrower
certifying that (A) the condition specified in Section 2(b)(iii) has been
satisfied, (B) except as disclosed in SEC filings or in press releases delivered
to the Lender prior to the date hereof, there has been no event or circumstance
since September 30, 2006 which has or could be reasonably expected to have a
Material Adverse Effect, and (C) each of the representations and warranties in
Section 3 hereof are true and correct as of the date hereof;

 

 

(vii)

such other documents and certificates as the Lender may reasonably request; and

 

 

(viii)

any fees and expenses required to be paid on or before the Closing Date shall
have been paid.

 

 

(b)

Conditions to Each Borrowing. As a condition precedent to each borrowing
(including the initial borrowing) of any Loan:

 

(i)

The Borrower must furnish the Lender with a notice of borrowing;

 

(ii)

each representation and warranty set forth in Section 3 below, but excluding the
representation and warranty contained in Section 5.11(b) of the Incorporated
Agreement, shall be true and correct on and as of the date of such borrowing,
before and after giving effect to such borrowing and to the application of the
proceeds therefrom, as if made on and as of such date, except to the extent such
representations and warranties expressly refer to an earlier date, in which case
they shall be true and correct as of such earlier date, and except that for
purposes of this Section 2(b), the representations and warranties contained in
Section 5.11(a) of the Incorporated Agreement shall be deemed to refer to the
most recent statements furnished pursuant to Section 4 herein (by way of its
incorporation of clauses (a) and (b), respectively, of Section 6.01 of the
Incorporated Agreement); and

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St. Jude Medical, Inc.

January 25, 2007

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(iii)

no Default or Event of Default shall have occurred and be continuing on the date
of such borrowing.

Each notice of borrowing shall be deemed a representation and warranty by the
Borrower that the conditions referred to in clauses (ii) and (iii) above have
been met.

 

3.

Representations and Warranties. The Borrower represents and warrants (which
representations and warranties shall survive the Closing Date and each borrowing
hereunder) that the representations and warranties contained in Article V
(Representations and Warranties) of the Incorporated Agreement, other than the
first sentence of Section 5.08 thereof or as indicated on the schedules attached
as Exhibit D to this Agreement, are true and correct as if made on such date,
except to the extent that such representations and warranties specifically refer
to an earlier date, in which case they shall be true and correct as of such
earlier date. The representations and warranties of the Borrower referred to in
the preceding sentence (including all exhibits and defined terms referred to
therein) are hereby incorporated herein by reference as if set forth in full
herein.

4.

Covenants. (a) So long as principal of and interest on any Loan or any other
amount payable hereunder or under any other Loan Document remains unpaid or
unsatisfied and the Commitment has not been terminated, the Borrower shall
comply with all the covenants and agreements contained in Article VI
(Affirmative Covenants), other than Section 6.11 thereof, and Article VII
(Negative Covenants), other than Section 7.07 thereof, of the Incorporated
Agreement. The covenants and agreements of the Borrower referred to in the
preceding sentence (including all exhibits and defined terms referred to
therein) are hereby incorporated herein by reference as if set forth in full
herein. Notwithstanding the foregoing, Sections 7.01 and 7.02 of the
Incorporated Agreement shall not apply to any Excess Margin Stock.

(b)          In addition to the covenants and agreements incorporated in Section
4(a) above, the Borrower also covenants and agrees that:

(i)           Use of Proceeds. The proceeds of the Loans will be used for
financing in part the Stock Repurchase.

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January 25, 2007

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(ii)          Assignments and Agency Amendment. In the event that the Initial
Lender at any time makes any assignment pursuant to Section 6(e) such that,
after giving effect to such assignment, there is to be more than one lender
under this Agreement, at the request of the Initial Lender, the Borrower and the
Initial Lender shall enter into and diligently continue good-faith negotiations
to amend and restate this Agreement with customary definitive documentation to
provide for such provisions of agency (including the naming of the Initial
Lender, or an Affiliate of the Initial Lender, as the agent) as are determined
by the Initial Lender to be necessary or desirable in the administration of this
Agreement at such time, and such amendment shall only require the approval of
the Initial Lender and the Borrower.

(iii)         Margin Regulations. Following the application of proceeds of each
Loan, the Borrower will not be in violation of Regulation X and the Loan will
not be in violation of Regulation U of the Board of Governors of the Federal
Reserve System.

5.

Events of Default. The following are “Events of Default”:

 

(a)

The Borrower fails to pay any principal of any Loan as and on the date when due;
or

 

(b)

The Borrower fails to pay any interest on any Loan due hereunder, or any portion
thereof, or fails to pay any other fee or amount payable to the Lender under any
Loan Document, or any portion thereof, within five Business Days after the date
due; or

 

(c)

The Borrower fails to comply with (i) any covenant or agreement incorporated
herein by reference pursuant to Section 4 above, (ii) Section 4(b)(ii) and such
failure continues for ten Business Days after written notice thereof is given to
the Borrower by the Lender, or (iii) any other provision of this Agreement, in
the cases of clauses (i) and (iii) above subject to any applicable grace period
and/or notice requirement set forth in Article VIII of the Incorporated
Agreement (it being understood and agreed that any such notice requirement be
and the same hereby is incorporated by reference as in effect as if set forth
herein, provided that any such notice requirement shall be deemed satisfied by
the Lender’s giving the applicable notice to the Borrower hereunder); or

 

(d)

Any representation or warranty made by the Borrower herein or by the Borrower
(or any of its officers) in connection with this Agreement is incorrect in any
material respect on or as of the date made or deemed made, including any
representation or warranty incorporated herein by reference pursuant to Section
3 above; or

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January 25, 2007

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(e)

The Borrower or any of its Subsidiaries fails to comply with, or there shall
otherwise occur, an “Event of Default” as set forth in Sections 8.01(e) – (l) of
the Incorporated Agreement subject to any applicable grace period and/or notice
requirement set forth in Article VIII of the Incorporated Agreement, all of
which Events of Default (including all defined terms referred to therein) are
hereby incorporated herein by reference as if set forth in full herein with
appropriate substitutions.

Upon the occurrence and during the continuance of an Event of Default, the
Lender may in each case declare the Commitment to be terminated, whereupon the
Commitment shall forthwith terminate, and/or declare all sums outstanding
hereunder and under the other Loan Documents, all interest thereon and all other
amounts payable under this Agreement or any other Loan Document to be forthwith
due and payable, whereupon all such outstanding amounts, all such interest and
all such other amounts shall become and be forthwith due and payable, without
presentment, demand, protest or further notice of any kind, all of which are
hereby expressly waived by the Borrower; provided, however, that in the event of
an actual or deemed entry of an order for relief with respect to the Borrower
under any Debtor Relief Law (as defined in the Incorporated Agreement), the
Commitment shall automatically terminate, and all sums outstanding hereunder and
under each other Loan Document, all interest and all such amounts shall
automatically become and be due and payable, without presentment, demand,
protest or any notice of any kind, all of which are hereby expressly waived by
the Borrower.

6.

Miscellaneous.

 

(a)

The provisions of Section 1.03 of the Incorporated Agreement are hereby
incorporated by reference, and each party hereto shall fully comply therewith,
as if set forth in full herein.

 

(b)

All references herein and in the other Loan Documents to any time of day shall
mean the local (standard or daylight, as in effect) time of New York, New York.

 

(c)

No amendment or waiver of any provision of this Agreement (including any
provision of the Incorporated Agreement incorporated herein by reference) or of
any other Loan Document and no consent by the Lender to any departure therefrom
by the Borrower shall be effective unless such amendment, waiver or consent
shall be in writing and signed by a duly authorized officer of the Lender, and,
in the case of an amendment, the Borrower. Any such amendment, waiver or consent
shall then be effective only for the period and on the conditions and for the
specific instance specified in such writing. No failure or delay by the Lender
in exercising any right, power or privilege hereunder shall operate as a waiver
thereof, nor shall any single or partial exercise thereof preclude any other or
further exercise thereof or the exercise of any other rights, power or
privilege.

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January 25, 2007

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(d)

(i)            Unless otherwise expressly provided herein, all notices and other
communications provided for hereunder shall be in writing (including by
facsimile transmission). All such written notices shall be mailed, faxed or
delivered to the applicable address, facsimile number or (subject to subsection
(iii) below) electronic mail address, and all notices and other communications
expressly permitted hereunder to be given by telephone shall be made to the
applicable telephone number, if to the Borrower or the Lender, initially, to the
address, facsimile number, electronic mail address or telephone number as
appears below the signature of each such party hereto, and otherwise as shall be
designated by such party in a notice to the other party.

All such notices and other communications shall be deemed to be given or made
upon the earlier to occur of (A) actual receipt by the relevant party hereto and
(B) (1) if delivered by hand or by courier, when signed for by or on behalf of
the relevant party hereto; (2) if delivered by mail, four Business Days after
deposit in the mails, postage prepaid; (3) if delivered by facsimile, when sent
and receipt has been confirmed by telephone; and (4) if delivered by electronic
mail (which form of delivery is subject to the provisions of subsection (iii)
below), when delivered; provided, however, that notices and other communications
to the Lender pursuant to Section 1 shall not be effective until actually
received by the Lender. In no event shall a voicemail message be effective as a
notice, communication or confirmation hereunder.

(ii)          Loan Documents may be transmitted and/or signed by facsimile. The
effectiveness of any such documents and signatures shall, subject to applicable
law, have the same force and effect as manually-signed originals and shall be
binding on the Borrower and the Lender. The Lender may also require that any
such documents and signatures be confirmed by a manually-signed original
thereof; provided, however, that the failure to request or deliver the same
shall not limit the effectiveness of any facsimile document or signature.

(iii)         Electronic mail and Internet and intranet websites may be used
only to distribute routine communications, such as financial statements, and to
distribute Loan Documents for execution by the parties thereto, and may not be
used for any other purpose.

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January 25, 2007

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(iv)         The Lender shall be entitled to rely and act upon any notices
(including telephonic notices of borrowings, conversions and continuations)
believed in good faith by the Lender to be given by or on behalf of the Borrower
even if (A) such notices were not made in a manner specified herein, were
incomplete or were not preceded or followed by any other form of notice
specified herein, or (B) the terms thereof, as understood by the recipient,
varied from any confirmation thereof. The Borrower shall indemnify the Lender,
its affiliates and the officers, directors, employees, agents and
attorneys-in-fact of the Lender and such affiliates from all losses, costs,
expenses and liabilities resulting from the reliance by such Person on each
notice reasonably believed by the recipient to be given by or on behalf of the
Borrower. All telephonic notices to and other communications with the Lender may
be recorded by the Lender, and the Borrower hereby consents to such recording.

 

(e)

This Agreement shall inure to the benefit of the parties hereto and their
respective successors and assigns, except that the Borrower may not assign its
rights and obligations hereunder. The Lender may at any time (i) assign all or
any part of its rights and obligations hereunder to any other Person, and (ii)
grant to any other Person participating interests in all or part of its rights
and obligations hereunder without notice to the Borrower. The Borrower agrees to
enter into any documents reasonably requested by the Lender in connection with
any such assignment in accordance with Section 4(b)(ii). All information
provided by or on behalf of the Borrower to the Lender or its affiliates may be
furnished by the Lender to its affiliates and to any actual or proposed assignee
or participant.

 

(f)

The Borrower agrees to pay, upon demand, all reasonable out-of-pocket costs and
expenses of the Lender in connection with the preparation, execution, delivery,
administration, modification and amendment of this Agreement, the Note and the
other documents to be delivered hereunder, including, without limitation, (i)
all due diligence, duplication and messenger costs and (ii) the reasonable and
documented fees and expenses of counsel for the Lender with respect thereto and
with respect to advising the Lender as to its rights and responsibilities under
this Agreement. The Borrower further agrees to pay, upon demand, all reasonable
out-of-pocket costs and expenses of the Lender, if any (including, without
limitation, reasonable counsel fees and expenses), in connection with the
enforcement (whether through negotiations, legal proceedings or otherwise) of
this Agreement, the Note and the other documents to be delivered hereunder,
including, without limitation, in connection with the enforcement of rights
under this Section 6(f). The agreements in this Section 6(f) shall survive the
termination of the Commitments and repayment of all other Loans and obligations
of the Borrower hereunder.

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St. Jude Medical, Inc.

January 25, 2007

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(g)

In connection with all aspects of each transaction contemplated by this
Agreement, you acknowledge and agree that: (i) the Commitment and any related
arranging or other services described in this Agreement is an arm’s-length
commercial transaction between you and your affiliates, on the one hand, and
Bank of America, on the other hand, and you are capable of evaluating and
understanding and understand and accept the terms, risks and conditions of the
transactions contemplated by this Agreement; (ii) in connection with the process
leading to such transaction, Bank of America is and has been acting solely as a
principal and is not the financial advisor, agent or fiduciary for you or any of
your affiliates, stockholders, creditors or employees or any other party; (iii)
Bank of America has not assumed and will not assume an advisory, agency or
fiduciary responsibility in your or your affiliates’ favor with respect to any
of the transactions contemplated hereby or the process leading thereto
(irrespective of whether Bank of America has advised or is currently advising
you or your affiliates on other matters) and Bank of America has no obligation
to you or your affiliates with respect to the transactions contemplated hereby
except those obligations expressly set forth in this Agreement; (iv) Bank of
America and its affiliates may be engaged in a broad range of transactions that
involve interests that differ from yours and your affiliates and Bank of America
has no obligation to disclose any of such interests by virtue of any advisory,
agency or fiduciary relationship; and (v) Bank of America has not provided any
legal, accounting, regulatory or tax advice with respect to any of the
transactions contemplated hereby and you have consulted your own legal,
accounting, regulatory and tax advisors to the extent you have deemed
appropriate. You hereby waive and release, to the fullest extent permitted by
law, any claims that you may have against Bank of America with respect to any
breach or alleged breach of agency or fiduciary duty.

 

(h)

The provisions of Section 10.04(b) of the Incorporated Agreement are hereby
incorporated by reference, and each party hereto shall fully comply therewith,
as if set forth in full herein.

 

(i)

If any provision of this Agreement or any other Loan Document shall be held
invalid or unenforceable in whole or in part, such invalidity or
unenforceability shall not affect the remaining provisions hereof or thereof.

 

(j)

This Agreement may be executed in one or more counterparts, and each
counterpart, when so executed, shall be deemed an original but all such
counterparts shall constitute but one and the same instrument.

 

(k)

The provisions of Section 10.07 of the Incorporated Agreement are hereby
incorporated by reference, and the Borrower shall fully comply therewith, as if
set forth in full herein.

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St. Jude Medical, Inc.

January 25, 2007

Page 13

 

 

 

(l)

All representations and warranties made hereunder and in any other Loan Document
or other document delivered pursuant hereto or thereto or in connection herewith
or therewith shall survive the execution and delivery hereof and thereof. Such
representations and warranties have been or will be relied upon by the Lender,
regardless of any investigation made by the Lender or on their behalf and
notwithstanding that the Lender may have had notice or knowledge of any Default
at the time of any Loan, and shall continue in full force and effect as long as
any Loan or any other obligation of the Borrower hereunder shall remain unpaid
or unsatisfied.

 

(m)

This Agreement and the other Loan Documents are governed by, and shall be
construed in accordance with, the laws of the State of New York and the
applicable laws of the United States of America. The Borrower hereby submits to
the nonexclusive jurisdiction of the courts of the state of New York sitting in
New York or of the United States for the purposes of all legal proceedings
arising out of or relating to any of the Loan Documents or the transactions
contemplated thereby. The Borrower irrevocably consents to the service of any
and all process in any such action or proceeding by the mailing of copies of
such process to the Borrower at its address set forth beneath its signature
hereto. The Borrower irrevocably waives, to the fullest extent permitted by law,
any objection which it may now or hereafter have to the laying of the venue of
any such proceeding brought in such a court and any claim that any such
proceeding brought in such a court has been brought in an inconvenient forum.

 

(n)

EACH PARTY TO THIS AGREEMENT, TO THE EXTENT PERMITTED BY APPLICABLE LAW, HEREBY
EXPRESSLY WAIVES ANY RIGHT TO TRIAL BY JURY OF ANY CLAIM, DEMAND, ACTION OR
CAUSE OF ACTION ARISING UNDER ANY LOAN DOCUMENT OR IN ANY WAY CONNECTED WITH OR
RELATED OR INCIDENTAL TO THE DEALINGS OF THE PARTIES HERETO OR ANY OF THEM WITH
RESPECT TO ANY LOAN DOCUMENT, OR THE TRANSACTIONS RELATED THERETO, IN EACH CASE
WHETHER NOW EXISTING OR HEREAFTER ARISING, AND WHETHER FOUNDED IN CONTRACT OR
TORT OR OTHERWISE; AND EACH PARTY HEREBY AGREES AND CONSENTS THAT ANY SUCH
CLAIM, DEMAND, ACTION OR CAUSE OF ACTION SHALL BE DECIDED BY COURT TRIAL WITHOUT
A JURY, AND THAT ANY PARTY TO THIS AGREEMENT MAY FILE AN ORIGINAL COUNTERPART OR
A COPY OF THIS SECTION WITH ANY COURT AS WRITTEN EVIDENCE OF THE CONSENT OF THE
SIGNATORIES HERETO TO THE WAIVER OF THEIR RIGHT TO TRIAL BY JURY.

 

(o)

THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS REPRESENT THE FINAL AGREEMENT
BETWEEN THE PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR OR
CONTEMPORANEOUS WRITTEN AGREEMENTS OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES.
THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.

--------------------------------------------------------------------------------

St. Jude Medical, Inc.

January 25, 2007

Page 14

 

 

Please indicate your acceptance of the Commitment on the foregoing terms and
conditions by returning an executed copy of this Agreement to the undersigned
not later than January 25, 2007.

 

 

 

 

BANK OF AMERICA, N.A.

 

By: 

/s/ Richard C. Hardison

 

 

Name:

Richard C. Hardison

 

 

Title:

Vice President

 

 

 

 

 

 

Address for Notices:

 

 

 

 

 

Bank of America, N.A.

101 N. Tryon Street,

NC1-001-04-39

Charlotte, NC 28255

Attn: Sue Naik

 

 

Accepted and Agreed to as of the date below:

 

ST. JUDE MEDICAL, INC.

By: /s/ John C. Heinmiller

Name: John C. Heinmiller

Title: Executive Vice President and Chief Financial Officer

Date: January 25, 2007

 

Address for Notices:

 

St. Jude Medical, Inc.

One Lillehei Plaza

St. Paul, MN 55117

Attention: Chief Financial Officer

--------------------------------------------------------------------------------

EXHIBIT A

DEFINITIONS

To the extent any definition herein refers to a definition in the Incorporated
Agreement, any term used in such definition in the Incorporated Agreement shall
also have the meaning ascribed thereto in the Incorporated Agreement, without
regard to any definition of the same term in this Agreement.

Affiliate:

Has the meaning set forth in the Incorporated Agreement.

 

 

Agreement:

This letter agreement, as amended, restated, extended, supplemented or otherwise
modified in accordance with Section 6(c) hereof in writing from time to time.

 

 

Applicable Margin:

An amount equal to 0.350% per annum with respect to Eurodollar Rate Loans.

 

 

Bank of America:

Bank of America, N.A.

 

 

Base Rate:

Has the meaning set forth in the Incorporated Agreement, including the
definition of Federal Funds Rate as such term is used therein.

 

 

Base Rate Loan:

A Loan bearing interest based on the Base Rate.

 

 

Borrower:

Has the meaning set forth in the preamble to the Agreement.

 

 

Business Day:

Any day other than a Saturday, Sunday, or other day on which commercial banks
are authorized to close under the laws of, or are in fact closed in, New York or
the state where the Lender’s lending office is located and, if such day relates
to any Eurodollar Rate Loan, means any such day on which dealings in Dollar
deposits are conducted by and between banks in the offshore Dollar interbank
market.

 

 

Closing Date:

The first date all of the conditions precedent in Section 2(a) are satisfied or
waived by the Lender.

 

 

Commitment:

Has the meaning set forth in Section 1(a) of the Agreement.

 

 

Debt Issuance:

The incurrence, issuance or sale by the Borrower or any of its Subsidiaries of
any debt, including, without limitation, any debt securities (other than
commercial paper), whether in a public offering of such securities or otherwise,
but excluding incurrence of any debt hereunder, under the Incorporated Agreement
or any Senior Credit Refinancing.

 

 

Default:

Any event that, with the giving of any notice, the passage of time, or both,
would be an Event of Default.

 

 

A-1

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Default Rate:

An interest rate equal to (a) the Base Rate plus (b) 2% per annum; provided,
however, that with respect to a Eurodollar Rate Loan, until the end of the
Interest Period during which the Default Rate is applicable, the Default Rate
shall be an interest rate equal to the interest rate (including any Applicable
Margin) otherwise applicable to such Loan plus 2% per annum, in each case to the
fullest extent permitted by applicable Laws.

 

 

Dollar or $:

Has the meaning set forth in the Incorporated Agreement.

 

 

Equity Interests:

With respect to any Person, all of the shares of capital stock of (or other
ownership or profit interests in) such Person, all of the warrants, options or
other rights for the purchase or acquisition from such Person of shares of
capital stock of (or other ownership or profit interests in) such Person, all of
the securities convertible into or exchangeable for shares of capital stock of
(or other ownership or profit interests in) such Person or warrants, rights or
options for the purchase or acquisition from such Person of such shares (or such
other interests), and all of the other ownership or profit interests in such
Person (including partnership, member or trust interests therein), whether
voting or nonvoting, and whether or not such shares, warrants, options, rights
or other interests are outstanding on any date of determination.

 

 

Equity Issuance:

The issuance, sale or other disposition by the Borrower or any of its
Subsidiaries of any of its Equity Interests (including, without limitation,
pursuant to an initial underwritten public offering of the common stock of the
Borrower or any of its Subsidiaries pursuant to an effective registration
statement filed with the SEC (whether alone or in conjunction with a secondary
public offering)), other than pursuant to options outstanding as of the Closing
Date or restricted shares granted to employees and non-employee directors in the
ordinary course of business, or any rights, warrants or options (other than
options granted to employees and non-employee directors in the ordinary course
of business) to purchase or acquire any shares of its Equity Interests or any
other security or instrument representing, convertible into or exchangeable for
any Equity Interests in the Borrower or any of its Subsidiaries.

 

 

Eurodollar Rate:

Has the meaning set forth in the Incorporated Agreement, including the
definitions of Eurodollar Base Rate and Eurodollar Reserve Percentage as such
terms are used therein.

 

 

Eurodollar Rate Loan:

A Loan bearing interest based on the Eurodollar Rate.

 

 

Event of Default:

Has the meaning set forth in Section 5 of the Agreement.

 

 

Excess Margin Stock:

That amount by which the value of all “margin stock” (as such term is defined in
Regulation U of the Board of Governors of the Federal Reserve System, as the
same may be amended, modified or interpreted from time to time) owned by the
Borrower and its Subsidiaries exceeds 25% of the value of all of the assets
owned by the Borrower and its Subsidiaries subject to Sections 7.01 and 7.02 of
the Incorporated Agreement.

 

 

A-2

--------------------------------------------------------------------------------

GAAP:

Has the meaning set forth in the Incorporated Agreement.

 

 

Incorporated Agreement:

The Multi-Year $1,000,000,000 Credit Agreement dated as of December 13, 2006
among the Borrower, each lender from time to time party thereto, and Bank of
America, N.A. as the administrative agent, as amended, restated, amended and
restated, supplemented or otherwise modified from time to time during the term
of this Agreement. A copy of the Incorporated Agreement is attached as Exhibit
C. For purposes of this Agreement the Borrower specifically covenants and agrees
that each term or provision of the Incorporated Agreement incorporated by
reference into this Agreement is effective and binding upon the Borrower as if
set forth herein. All such incorporated terms and provisions are incorporated
herein with appropriate substitutions, including the following:

 

(i)           all references to “the Administrative Agent”, “L/C Issuer”, “the
Lenders”, “each Lender”, “any Lender”, and “the Required Lenders” shall be
deemed to be references to the Lender;

 

(ii)          all references to “this Agreement” shall be deemed to be
references to this Agreement;

 

(iii)         all references to “Borrower” shall be deemed to be references to
the Borrower;

 

(iv)         all references to “Commitment” shall be deemed references to the
Commitment;

 

(v)          all references to “Default” and “Event of Default” shall be deemed
to be references to a Default and an Event of Default, respectively;

 

(vi)         all references to “any Loan Document” shall be deemed to be
references to the Loan Documents;

 

(vii)        all references to “Loans” and “Letter of Credit” shall be deemed to
be references to the Loans;

 

(viii)       all references to “Obligations” shall be deemed to be references to
Obligations;

 

(ix)          all references to the “transactions contemplated hereby” shall be
deemed to include reference to the Stock Repurchase;

 

(x)           references to “Audited Financial Statements” shall be deemed to be
references to financial statements for the fiscal year or years ended December
31, 2005; and

 

(xi)          references to any schedules shall be deemed to be references to
the schedules attached hereto as Exhibit D.

 

 

 

 

A-3

--------------------------------------------------------------------------------

Indebtedness:

Has the meaning set forth in the Incorporated Agreement.

 

 

Indemnitee:

Has the meaning set forth in the Incorporated Agreement.

 

 

Interest Period:

For each Eurodollar Rate Loan, (a) initially, the period commencing on the date
the Eurodollar Rate Loan is disbursed or converted from a Base Rate Loan and (b)
thereafter, the period commencing on the last day of the preceding Interest
Period, and, in each case, ending on the earlier of (x) the Maturity Date and
(y) seven days, one month, two months or three months thereafter, as requested
by the Borrower; provided that:

 

(i)          any Interest Period that would otherwise end on a day that is not a
Business Day shall be extended to the next succeeding Business Day unless such
Business Day falls in another calendar month, in which case such Interest Period
shall end on the next preceding Business Day; and

 

(ii)         any Interest Period which 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 calendar month at the end of such Interest Period.

 

 

Laws:

Has the meaning set forth in the Incorporated Agreement.

 

 

Lender:

At all times prior to any assignment by the Lender pursuant to Section 6(e) of
the Agreement, the Lender, and at all times thereafter, each Person with Loans
outstanding to the Borrower under the Agreement, provided that at all times
there is more than one Person constituting a Lender hereunder, such term shall
mean each Lender, any Lender or all Lenders collectively, as the context may
indicate.

 

 

Lien:

Has the meaning set forth in the Incorporated Agreement.

 

 

Loan Documents:

This Agreement and the Note.

 

 

Loans:

Has the meaning set forth in Section 1(a) of the Agreement.

 

 

Material Adverse Effect:

Has the meaning set forth in the Incorporated Agreement.

 

 

Maturity Date:

The earlier of (a) the date that is 90 days after the Closing Date and (b) such
earlier date on which the Commitment may terminate in accordance with the terms
hereof.

 

 

 

 

A-4

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Net Cash Proceeds:

The aggregate cash proceeds received by the Borrower in respect of any Debt
Issuance, Equity Issuance or disposition of assets (including, without
limitation, any cash received upon the sale or other disposition of any non-cash
consideration received in any Debt Issuance, Equity Issuance or disposition of
assets), net of the direct costs relating to such Debt Issuance, Equity Issuance
or disposition of assets (including, without limitation legal, accounting and
investment banking fees, and sales commissions), taxes paid or payable as a
result thereof, and any reserve for adjustment in respect of the sale price of
such asset or assets established in accordance with GAAP, net of, in the case of
any disposition of assets, amounts required to be applied to repay principal,
interest and prepayment premiums and penalties on Indebtedness secured by a Lien
on the asset which is the subject of such disposition.

 

 

Note:

A promissory note of the Borrower payable to the order of the Lender in
substantially the form of Exhibit B hereunder, evidencing the aggregate
indebtedness of the Borrower to the Lender resulting from the Loans made by the
Lender to the Borrower, and following the effectiveness of any assignment
pursuant to Section 6(e) hereof, collectively refers to all promissory notes of
the Borrower payable to the order of each Lender.

 

 

Obligations:

All advances, debts, liabilities, obligations, covenants and duties arising
under any Loan Document, owing by the Borrower to the Lender or any Indemnitee,
whether joint or several, direct or indirect (including those acquired by
assignment), absolute or contingent, due or to become due, now existing or
hereafter arising.

 

 

Organizational Documents:

The certificate or articles of incorporation and the bylaws of the Borrower.

 

 

Person:

Has the meaning set forth in the Incorporated Agreement.

 

 

Responsible Officer:

Has the meaning set forth in the Incorporated Agreement.

 

 

SEC:

Has the meaning set forth in the Incorporated Agreement.

 

 

Senior Credit Refinancing:

The Borrower (i) amending or amending and restating the Incorporated Agreement
to increase the aggregate total commitment of the lenders thereunder, or (ii)
otherwise entering into a new senior syndicated credit facility or issuing any
senior debt other than commercial paper, in any event as may occur at any time
after the Closing Date.

 

 

Stock Repurchase:

A stock repurchase and trading plan permitting the Borrower to purchase its
shares of the common stock, par value $0.10, in an amount not to exceed
$700,000,000 and which qualifies for the safe harbors provided by Rule 10b-18
and Rule 10b5-1 each under the Securities Exchange Act of 1934, as amended.

 

 

Subsidiary:

With respect to any Person, a corporation, partnership, joint venture, limited
liability company or other business entity of which a majority of the shares of
securities or other interests having ordinary voting power for the election of
directors or other governing body (other than securities or interests having
such power only by reason of the happening of a contingency) are at the time
beneficially owned, or the management of which is otherwise controlled,
directly, or indirectly through one or more intermediaries, or both, by such
Person. Unless otherwise specified, all references herein to a “Subsidiary” or
to “Subsidiaries” refer to a Subsidiary or Subsidiaries of the Borrower.

 

A-5

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EXHIBIT B

FORM OF PROMISSORY NOTE

January 25, 2007

 

FOR VALUE RECEIVED, the undersigned, ST. JUDE MEDICAL, INC., a Minnesota
corporation (the “Borrower”), promises to pay to the order of BANK OF AMERICA,
N.A. (the “Lender”) on the Maturity Date (as such term is defined in the Letter
Agreement, dated as of January 25, 2007 (as amended, amended and restated,
supplemented or otherwise modified from time to time, the “Letter Agreement”),
between the Borrower and the Lender) the aggregate unpaid principal amount of
all Loans made by the Lender to the Borrower from time to time pursuant to the
Letter Agreement. A notation indicating all Loans made by the Lender pursuant to
the Letter Agreement and payments on account of the principal of such Loans may,
from time to time, be made by the holder hereof on the grid attached to this
note (the “Note”). Unless defined herein or the context otherwise requires,
terms used herein have the meanings provided in the Letter Agreement.

 

Interest upon the unpaid principal amount hereof shall accrue at the rates,
shall be calculated in the manner and shall be payable on the dates set forth in
the Letter Agreement. Both principal and interest shall be payable in accordance
with the Letter Agreement to the account designated by the Lender.

 

This Note is the Note referred to in, and evidences indebtedness incurred in
respect of the Loans under, the Letter Agreement, to which reference is made for
a statement of the terms and conditions on which the Borrower is permitted and
required to make prepayments of principal of the indebtedness evidenced by this
Note and on which such indebtedness may be declared to be immediately due and
payable.

THIS NOTE SHALL BE DEEMED TO BE A CONTRACT MADE UNDER AND GOVERNED BY THE
INTERNAL LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO THE CONFLICT OF LAWS
PROVISIONS OF THE STATE OF NEW YORK, BUT GIVING EFFECT TO FEDERAL LAWS
APPLICABLE TO NATIONAL BANKS.

 

 

 

ST. JUDE MEDICAL, INC.

 

By: 

 

 

Name:

 

 

 

Title:

 

 

--------------------------------------------------------------------------------

LOANS AND PAYMENTS WITH RESPECT THERETO

Date

 

Amount of Loan Made

 

Amount of Principal or Interest Paid This Date

 

Outstanding Principal Balance This Date

 

Notation
Made By

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

--------------------------------------------------------------------------------

EXHIBIT C

COPY OF INCORPORATED AGREEMENT

 

Incorporated by reference from Exhibit 10.1 of
St. Jude Medical’s
Current Report on Form 8-K
filed on December 18, 2006

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