Exhibit 10.1

CONFIDENTIAL TREATMENT

EXECUTION VERSION

 

 

$3,000,000,000

CREDIT AGREEMENT

Dated as of October 20, 2010

among

DaVita Inc.,

as Borrower,

The Guarantors Party Hereto,

The Lenders Party Hereto,

Credit Suisse AG

Barclays Bank PLC

Goldman Sachs Bank USA

Wells Fargo Bank, National Association,

Credit Agricole Corporate and Investment Bank

RBC Capital Markets*

Scotia Capital (USA) Inc.

SunTrust Robinson Humphrey, Inc.

and

Union Bank, N.A.

as Co-Documentation Agents,

Bank of America, N.A.,

as Syndication Agent

and

JPMorgan Chase Bank, N.A.,

as Administrative Agent and Collateral Agent

 

 

J.P. Morgan Securities LLC

Banc of America Securities LLC

Credit Suisse Securities (USA) LLC

Barclays Capital

Goldman Sachs Bank USA

and

Wells Fargo Securities, LLC

as Joint Lead Arrangers and Joint Bookrunners

 

 

 

* RBC Capital Markets is a marketing name for the corporate and investment
banking activities of Royal Bank of Canada and its subsidiaries

 

[DELETED] = Portions of this exhibit are subject to a request for confidential
treatment and have been redacted and filed separately with the Securities and
Exchange Commission.

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TABLE OF CONTENTS

 

     Page  

SECTION 1 DEFINITIONS

     1   

1.1

  

Defined Terms

     1   

1.2

  

Classification of Loans

     39   

1.3

  

Terms Generally

     39   

1.4

  

Accounting Terms; GAAP

     39   

1.5

  

Resolution of Drafting Ambiguities

     40   

1.6

  

Exchange Rates; Currency Equivalents

     40   

1.7

  

Additional Alternative Currencies

     40   

1.8

  

Change of Currency

     41   

SECTION 2 AMOUNT AND TERMS OF COMMITMENTS

     41   

2.1

  

Term Commitments

     41   

2.2

  

Procedure for Term Loan Borrowing

     41   

2.3

  

Repayment of Term Loans

     42   

2.4

  

Revolving Commitments

     42   

2.5

  

Procedure for Revolving Loan Borrowing

     43   

2.6

  

Swingline Commitment

     43   

2.7

  

Procedure for Swingline Borrowing; Refunding of Swingline Loans

     44   

2.8

  

Commitment Fees, etc.

     46   

2.9

  

Termination or Reduction of Revolving Commitments

     47   

2.10

  

Optional Prepayments

     47   

2.11

  

Mandatory Prepayments and Commitment Reductions

     47   

2.12

  

Conversion and Continuation Options

     50   

2.13

  

Limitations on Eurodollar Tranches

     50   

2.14

  

Interest Rates and Payment Dates

     50   

2.15

  

Computation of Interest and Fees

     51   

2.16

  

Inability to Determine Interest Rate

     51   

2.17

  

Pro Rata Treatment and Payments

     52   

2.18

  

Requirements of Law

     54   

2.19

  

Taxes

     55   

2.20

  

Indemnity

     57   

2.21

  

Change of Lending Office

     57   

2.22

  

Replacement of Lenders

     57   

2.23

  

Repayment of Loans; Evidence of Debt

     58   

2.24

  

Increase in Commitments

     59   

2.25

  

Extensions of Term Loans and Revolving Commitments

     61   

2.26

  

Defaulting Lenders

     63   

SECTION 3 LETTERS OF CREDIT

     65   

3.1

  

LC Commitment

     65   

3.2

  

Notice of Issuance, Amendment, Renewal, Extension; Certain Conditions

     66   

3.3

  

Fees and Other Charges

     66   

3.4

  

Participations

     66   

3.5

  

Reimbursement

     66   

 

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          Page  

3.6

  

Obligations Absolute

     67   

3.7

  

Disbursement Procedures

     68   

3.8

  

Interim Interest

     68   

3.9

  

Replacement of the Issuing Lender

     68   

3.10

  

Cash Collateralization

     68   

3.11

  

Provisions Related to Extended Alternative Currency Revolving Commitments

     69   

SECTION 4 REPRESENTATIONS AND WARRANTIES

     69   

4.1

  

Organization; Power

     69   

4.2

  

Capital Stock; Subsidiaries

     70   

4.3

  

Authorization; No Conflicts

     70   

4.4

  

No Approvals

     70   

4.5

  

Enforceability

     71   

4.6

  

Litigation

     71   

4.7

  

Financial Statements; Projections

     71   

4.8

  

Properties

     71   

4.9

  

Intellectual Property

     72   

4.10

  

No Material Misstatements

     72   

4.11

  

Margin Stock

     73   

4.12

  

Investment Company Act

     73   

4.13

  

Solvency

     73   

4.14

  

Employee Benefit Plans

     73   

4.15

  

Environmental Laws

     74   

4.16

  

Taxes

     74   

4.17

  

Government Reimbursement Programs; Medicare/Medicaid/Tricare

     75   

4.18

  

Agreements

     76   

4.19

  

Use of Proceeds

     76   

4.20

  

Labor Matters

     76   

4.21

  

Insurance

     77   

4.22

  

Security Documents

     77   

4.23

  

Anti-Terrorism Law

     78   

SECTION 5 CONDITIONS PRECEDENT

     78   

5.1

  

Conditions to Initial Credit Extension

     78   

5.2

  

Conditions to All Credit Extensions

     81   

SECTION 6 AFFIRMATIVE COVENANTS

     81   

6.1

  

Reporting Requirements

     81   

6.2

  

Compliance with Laws, Etc.

     84   

6.3

  

Payment of Taxes, Etc.

     84   

6.4

  

Compliance with Environmental Laws

     85   

6.5

  

Insurance

     85   

6.6

  

Preservation of Corporate Existence, Etc.

     86   

6.7

  

Visitation Rights

     86   

6.8

  

Keeping of Books

     86   

6.9

  

Maintenance of Properties, Etc.

     86   

 

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          Page  

6.10

  

Transactions with Affiliates

     86   

6.11

  

Use of Proceeds

     86   

6.12

  

Additional Collateral; Additional Guarantors

     87   

6.13

  

Security Interests; Further Assurances

     88   

6.14

  

Information Regarding Collateral

     88   

6.15

  

Ratings

     89   

SECTION 7 NEGATIVE COVENANTS

     89   

7.1

  

Liens, Etc.

     89   

7.2

  

Debt

     90   

7.3

  

Change in Nature of Business

     93   

7.4

  

Mergers, Etc.

     93   

7.5

  

Sales, Etc., of Assets

     93   

7.6

  

Investments in Other Persons

     96   

7.7

  

Restricted Payments

     98   

7.8

  

Accounting Changes

     99   

7.9

  

Prepayments of Other Debt; Modifications of Constitutive Documents and Other
Documents, etc.

     100   

7.10

  

Negative Pledge

     100   

7.11

  

Payment Restrictions Affecting Subsidiaries

     101   

7.12

  

Non-Guarantor Domestic Subsidiaries

     101   

7.13

  

Issuance of Additional Stock

     101   

7.14

  

Anti-Terrorism Law; Anti-Money Laundering

     102   

7.15

  

Embargoed Person

     102   

7.16

  

Financial Covenants

     103   

SECTION 8 EVENTS OF DEFAULT

     103   

8.1

  

Events of Default

     103   

8.2

  

Application of Proceeds

     106   

SECTION 9 THE AGENTS

     107   

9.1

  

Appointment and Authority

     107   

9.2

  

Rights as a Lender

     107   

9.3

  

Exculpatory Provisions

     107   

9.4

  

Reliance by Agent

     108   

9.5

  

Delegation of Duties

     108   

9.6

  

Resignation of Agent

     109   

9.7

  

Non-Reliance on Agent and Other Lenders

     109   

9.8

  

No Other Duties, etc.

     109   

SECTION 10 GUARANTEE

     109   

10.1

  

The Guarantee

     109   

10.2

  

Obligations Unconditional

     110   

10.3

  

Reinstatement

     111   

10.4

  

Subrogation; Subordination

     111   

10.5

  

Remedies

     111   

 

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          Page  

10.6

  

Instrument for the Payment of Money

     111   

10.7

  

Continuing Guarantee

     112   

10.8

  

General Limitation on Guaranteed Obligations

     112   

10.9

  

Release of Guarantors

     112   

SECTION 11 MISCELLANEOUS

     112   

11.1

  

Amendments and Waivers

     112   

11.2

  

Notices

     114   

11.3

  

No Waiver; Cumulative Remedies

     116   

11.4

  

Survival

     116   

11.5

  

Expenses; Indemnity; Damage Waiver

     116   

11.6

  

Successors and Assigns; Participations and Assignments

     118   

11.7

  

Adjustments; Set-off

     121   

11.8

  

Counterparts; Integration; Effectiveness

     121   

11.9

  

Severability

     122   

11.10

  

WAIVER OF JURY TRIAL

     122   

11.11

  

GOVERNING LAW

     122   

11.12

  

Submission to Jurisdiction; Waivers

     122   

11.13

  

Acknowledgments

     123   

11.14

  

Releases of Guarantees and Liens

     123   

11.15

  

Confidentiality

     123   

11.16

  

Headings

     124   

11.17

  

USA PATRIOT Act

     124   

11.18

  

Interest Rate Limitation

     124   

11.19

  

Delivery of Addenda

     124   

11.20

  

Third Party Beneficiary

     125   

 

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SCHEDULES:

1.1

   Existing Letters of Credit 1.2    Mandatory Cost 4.4    Consents,
Authorizations, Filings and Notices 4.8    Real Property 7.1(c)    Existing
Liens 7.2(b)    Existing Debt 7.6    Investments EXHIBITS: A    Form of Security
Agreement B    Form of Compliance Certificate C    Form of Solvency Certificate
D    [Reserved] E    Form of Assignment and Assumption F-1    Form of Legal
Opinion of Special Counsel F-2    Form of Legal Opinion of General Counsel G   
Form of Prepayment Option Notice H    Form of Borrowing Request I    Form of
Addendum J    Form of Exemption Certificate K-1    Form of Perfection
Certificate K-2    Form of Perfection Certificate Supplement L    Form of
Joinder Agreement M    Form of Intercompany Note N-1    Form of Revolving Loan
Note N-2    Form of Tranche A Term Loan Note N-3    Form of Tranche B Term Loan
Note N-4    Form of Swingline Note O    Form of LC Request P    Form of Interest
Election Request

 

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This CREDIT AGREEMENT, dated as of October 20, 2010 (as amended, restated,
supplemented or otherwise modified from time to time, this “Agreement”), among
DaVita Inc., a Delaware corporation (the “Borrower”), the Guarantors (as defined
in Section 1.1) party hereto, the several banks and other financial institutions
or entities from time to time lenders under this Agreement by execution hereof
or of an Addendum or pursuant to Section 11.19 (the “Lenders”), Credit Suisse
AG, Barclays Bank PLC, Goldman Sachs Bank USA and Wells Fargo Bank, National
Association, as co-documentation agents (in such capacity, the “Documentation
Agents”), Bank of America, N.A., as syndication agent (in such capacity, the
“Syndication Agent”), and JPMorgan Chase Bank, N.A., as administrative agent and
collateral agent.

WITNESSETH:

WHEREAS, the Borrower, the guarantors party thereto, the lenders party thereto
from time to time and JPMorgan Chase Bank, N.A., as administrative agent and
collateral agent, are party to that certain credit agreement, dated as of
October 5, 2005, as amended and restated as of February 23, 2007 (the “Existing
Credit Agreement”);

WHEREAS, the Borrower has made a tender offer (the “Tender Offer”) for any and
all of its outstanding 6-5/8% senior notes due 2013 (the “Existing Senior
Notes”) and 7-1/4% senior subordinated notes due 2015 (the “Existing Senior
Subordinated Notes” and together with the Existing Senior Notes, the “Existing
Notes”);

WHEREAS, in connection with the Transactions, the Borrower will issue
(i) $775,000,000 aggregate principal amount of 6-3/8% Senior Notes due 2018 and
(ii) $775,000,000 aggregate principal amount of 6-5/8% Senior Notes due 2020
(collectively, the “Senior Notes”), in each case, pursuant to the Senior Notes
Indenture.

WHEREAS, in connection with the consummation of the Transactions, the Borrower
has requested the Lenders to extend credit in the form of (a) Tranche A Term
Loans on the Closing Date, in an aggregate principal amount of $1,000,000,000,
(b) Tranche B Term Loans on the Closing Date in an aggregate principal amount of
$1,750,000,000, (c) Dollar Revolving Commitments in an aggregate principal
amount of $100,000,000 and (d) Alternative Currency Revolving Commitments in an
aggregate principal amount of $150,000,000; and

WHEREAS, the proceeds of the Loans are to be used in accordance with
Section 4.19.

NOW, THEREFORE, the Lenders are willing to extend such credit to Borrower and
the Issuing Lender is willing to issue letters of credit for the account of
Borrower on the terms and subject to the conditions set forth herein.
Accordingly, the parties hereto agree as follows:

SECTION 1

DEFINITIONS

1.1 Defined Terms. As used in this Agreement, the terms listed in this
Section 1.1 shall have the respective meanings set forth in this Section 1.1.

“ABR” shall mean for any day, a rate per annum (rounded upwards, if necessary,
to the next 1/100 of 1%) equal to the greatest of (a) the Prime Rate in effect
on such day, (b) the Federal Funds Effective Rate in effect on such day plus
 1/2 of 1% and (c) the Eurodollar Base Rate applicable on such day (or, if such
date is not a Business Day, the immediately preceding Business Day) if a
Eurodollar Loan

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with an Interest Period of one month were being made on such day plus 1%. For
purposes hereof: “Prime Rate” shall mean the rate of interest per annum publicly
announced from time to time by the Person serving as Administrative Agent as its
prime rate in effect at its principal office in New York City (the Prime Rate
not being intended to be the lowest rate of interest charged by the Person
serving as Administrative Agent in connection with extensions of credit to
debtors). Any change in the ABR due to a change in the Prime Rate or the Federal
Funds Effective Rate shall be effective as of the opening of business on the
effective day of such change in the Prime Rate or the Federal Funds Effective
Rate, respectively. Notwithstanding the foregoing, the ABR with respect to any
Tranche B Term Loan will be deemed to be 2.50% per annum if the ABR calculated
pursuant to this definition would otherwise be less than 2.50% per annum.

“ABR Loans” shall mean Loans the rate of interest applicable to which is based
upon the ABR. ABR Loans shall be denominated in Dollars.

“Addendum” shall mean an instrument in the form of Exhibit I by which a Lender
becomes a party to this Agreement on the Closing Date.

“Additional Excluded Taxes” shall have the meaning given to such term in
Section 2.19.

“Adjustment Date” shall have the meaning given to such term in the definition of
“Pricing Grid.”

“Administrative Agent” shall mean JPMorgan Chase Bank, N.A., together with its
affiliates, as the arranger of the Commitments and as the administrative agent
for the Lenders under this Agreement and the other Loan Documents, together with
any of its successors.

“Administrative Questionnaire” shall mean an Administrative Questionnaire in a
form supplied by the Administrative Agent.

“Affiliate” shall mean as to any Person, any other Person that, directly or
indirectly, is in control of, is controlled by, or is under common control with,
such Person. For purposes of this definition, “control” of a Person shall mean
the power, directly or indirectly, to direct or cause the direction of the
management and policies of such Person, whether by contract or otherwise.

“Agents” shall mean, collectively, the Syndication Agent, the Documentation
Agents, the Collateral Agent and the Administrative Agent.

“Aggregate Exposure” shall mean with respect to any Lender at any time, an
amount equal to the sum of (i) the aggregate then unpaid principal amount of
such Lender’s Term Loans and (ii) the amount of such Lender’s Revolving
Commitment then in effect or, if the Revolving Commitments have been terminated,
the amount of such Lender’s Revolving Extensions of Credit then outstanding.

“Aggregate Exposure Percentage” shall mean with respect to any Lender at any
time, the ratio (expressed as a percentage) of such Lender’s Aggregate Exposure
at such time to the Aggregate Exposure of all Lenders at such time.

“Agreement” shall have the meaning given to such term in the preamble hereto.

“Alternative Currency” shall mean each of Dollars, Euro and Sterling and each
other currency that is approved in accordance with Section 1.7.

 

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“Alternative Currency Equivalent” shall mean at any time, with respect to any
amount denominated in Dollars, (i) if the applicable Alternative Currency is
other than Dollars, the equivalent amount thereof in such Alternative Currency
as determined by the Administrative Agent at such time on the basis of the Spot
Rate (determined in respect of the most recent Revaluation Date) for the
purchase of such Alternative Currency with Dollars or (ii) if the applicable
Alternative Currency is Dollars, such amount.

“Alternative Currency Revolving Commitment” shall mean, as to any Lender, the
obligation of such Lender, if any, to make Alternative Currency Revolving Loans
and participate in Swingline Loans and Letters of Credit in an aggregate
principal and/or face amount not to exceed the amount set forth under the
heading “Alternative Currency Revolving Commitment” on such Lender’s Addendum,
in an Increase Joinder or in the Assignment and Assumption pursuant to which
such Lender became a party hereto, as the same may be changed from time to time
pursuant to the terms hereof.

“Alternative Currency Revolving Extensions of Credit” shall mean, as to any
Alternative Currency Revolving Lender at any time, an amount equal to the sum of
(a) the aggregate principal amount of all Alternative Currency Revolving Loans
held by such Lender then outstanding, (b) such Lender’s Alternative Currency
Revolving Percentage of the LC Obligations then outstanding and (c) such
Lender’s Alternative Currency Revolving Percentage of the aggregate principal
amount of Swingline Loans then outstanding.

“Alternative Currency Revolving Facility” shall mean the Alternative Currency
Revolving Commitments and the Alternative Currency Revolving Loans made
thereunder.

“Alternative Currency Revolving Lender” shall mean each Lender that has an
Alternative Currency Revolving Commitment or holds Alternative Currency
Revolving Loans.

“Alternative Currency Revolving Loans” shall have the meaning given to such term
in Section 2.4(a).

“Alternative Currency Revolving Percentage” shall mean, as to any Alternative
Currency Revolving Lender at any time, the percentage which such Lender’s
Alternative Currency Revolving Commitment then constitutes of the Total
Alternative Currency Revolving Commitments or, at any time after the Alternative
Currency Revolving Commitments shall have expired or terminated, the percentage
which the aggregate principal amount of such Lender’s Alternative Currency
Revolving Loans then outstanding constitutes of the aggregate principal amount
of the Alternative Currency Revolving Loans then outstanding; provided that, in
the event that the Alternative Currency Revolving Loans are paid in full prior
to the reduction to zero of the Total Alternative Currency Revolving Extensions
of Credit, the Alternative Currency Revolving Percentages shall be the
Alternative Currency Revolving Percentages in effect immediately prior to such
payment in full.

“Anti-Terrorism Laws” shall have the meaning given to such term in Section 4.23.

“Applicable Margin” shall mean for each Type of Loan, the rate per annum set
forth under the relevant column heading below:

 

     ABR Loans     Eurodollar Loans  

Revolving Loans and Swingline Loans

     1.75 %      2.75 % 

Tranche A Term Loans

     1.75 %      2.75 % 

Tranche B Term Loans

     2.00 %      3.00 % 

 

-3-

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provided that (i) on and after the first Adjustment Date occurring after the
completion of the Fiscal Quarter of the Borrower ending June 30, 2011, the
Applicable Margin in respect of all Loans (other than the Tranche B Term Loans)
will be determined pursuant to the Pricing Grid and (ii) during any period in
which the Borrower’s corporate family rating from Moody’s is Ba2 or better and
the Borrower’s corporate credit rating from S&P is BB or better, in each case
with a positive or stable outlook, the Applicable Margin with respect to Tranche
B Loans shall be reduced to (A) 1.75% for ABR loans and (B) 2.75% for Eurodollar
Loans; provided that each change in the Applicable Margin with respect to
Tranche B Term Loans resulting from a change in the such rating shall be
effective, in the case of an upgrade, during the period commencing on the date
of delivery by the Borrower to the Administrative Agent of written notice
thereof and ending on the date immediately preceding the effective date of the
next such change and, in the case of a downgrade, during the period commencing
on the date of the public announcement thereof and ending on the date
immediately preceding the effective date of the next such change.

“Applicable Time” shall mean with respect to any borrowings and payments in any
Alternative Currency, the local time in the place of settlement for such
Alternative Currency as may be determined by the Administrative Agent to be
necessary for timely settlement on the relevant date in accordance with normal
banking procedures in the place of payment.

“Application” shall mean an application, in such form as the Issuing Lender may
specify from time to time, requesting the Issuing Lender to open a Letter of
Credit.

“Approved Fund” shall have the meaning given to such term in Section 11.6(b).

“Asset Sale” shall mean any Disposition of property (including sales and
issuances of Capital Stock of any Subsidiary (other than sales and issuances
that do not decrease the percentage ownership of the Borrower and its
Subsidiaries in each class of Capital Stock of such Subsidiary)) or series of
related Dispositions of property (excluding any such Disposition permitted by
clause (a), (b), (c), (d), (e) or (j)(ii) of Section 7.5) that yields Net Cash
Proceeds to any Group Member (valued at the initial principal amount thereof in
the case of non-cash proceeds consisting of notes or other debt securities and
valued at fair market value in the case of other non-cash proceeds) in excess of
$10,000,000 (provided that the issuance and sale of the Borrower’s stock by the
Borrower shall not be deemed an “Asset Sale”).

“Assignee” shall have the meaning given to such term in Section 11.6(b).

“Assignment and Assumption” shall mean an Assignment and Assumption,
substantially in the form of Exhibit E.

“Available Amount” shall mean at any time, an amount equal to the sum of
Borrower’s Share of Excess Cash Flow for each Fiscal Year commencing with the
Fiscal Year ending December 31, 2011.

“Available Alternative Currency Revolving Commitment” shall mean as to any
Alternative Currency Revolving Lender at any time, an amount equal to (a) such
Lender’s Alternative Currency Revolving Commitment then in effect minus (b) such
Lender’s Alternative Currency Revolving Extensions of Credit then outstanding;
provided that in calculating any Lender’s Alternative Currency Revolving
Extensions of Credit for the purpose of determining such Lender’s Available
Alternative Currency Revolving Commitment pursuant to Section 2.8(a), the
aggregate principal amount of Swingline Loans then outstanding shall be deemed
to be zero.

 

-4-

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“Available Dollar Revolving Commitment” shall mean as to any Dollar Revolving
Lender at any time, an amount equal to (a) such Lender’s Dollar Revolving
Commitment then in effect minus (b) such Lender’s Dollar Revolving Extensions of
Credit then outstanding.

“Available Revolving Commitment” shall mean, collectively, the Available Dollar
Revolving Commitment and the Available Alternative Currency Revolving
Commitment.

“Bailee Letter” shall have the meaning assigned thereto in the Security
Agreement.

“Bankruptcy Event” shall mean, with respect to any Person, such Person has
become the subject of a bankruptcy or insolvency proceeding, or has had a
receiver, conservator, trustee, administrator, custodian, assignee for the
benefit of creditors or similar Person charged with the reorganization or
liquidation of its business appointed for it, or, in the good faith
determination of the Administrative Agent, has taken any action in furtherance
of, or indicating its consent to, approval of, or acquiescence in, any such
proceeding or appointment; provided that a Bankruptcy Event shall not result
solely by virtue of any ownership interest, or the acquisition of any ownership
interest, in such Person by a Governmental Authority or instrumentality thereof
if such ownership interest does not result in or provide such Person with
immunity from the jurisdiction of courts within the United States or from the
enforcement of judgments or writs of attachment on its assets or permit such
Person (or such Governmental Authority or instrumentality) to reject, repudiate,
disavow or disaffirm any contracts or agreements made by such Person.

“Benefitted Lender” shall have the meaning given to such term in
Section 11.7(a).

“Board” shall mean the Board of Governors of the Federal Reserve System of the
United States (or any successor).

“Board of Directors” shall mean with respect to any Person, (i) in the case of
any corporation, the board of directors of such Person, (ii) in the case of any
limited liability company, the board of managers of such Person, (iii) in the
case of any partnership, the Board of Directors of the general partner of such
Person and (iv) in any other case, the functional equivalent of the foregoing.

“Borrower” shall have the meaning given to such term in the preamble hereto.

“Borrower’s Share of Excess Cash Flow” shall mean for any Fiscal Year the
product of (A) Excess Cash Flow for such Fiscal Year multiplied by (B) a
percentage equal to 100% minus the ECF Percentage for such Fiscal Year.

“Borrowing Date” shall mean any Business Day specified by the Borrower as a date
on which the Borrower requests the relevant Lenders to make Loans hereunder.

“Borrowing Request” shall mean a Borrowing Request substantially in the form of
Exhibit H.

“Business Associate Agreement” shall have the meaning given to such term in
Section 5.1(k).

“Business Day” shall mean (i) with respect to Obligations denominated in
Dollars, a day other than a Saturday, Sunday or other day on which commercial
banks in New York City are authorized or required by law to close and (ii) with
respect to Obligations denominated in an Alternative Currency (other than
Dollars), a day on which banks are open for general business in London and, in
each case,

 

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(a) if such day relates to any interest rate settings as to a Eurodollar Loan
denominated in Dollars, any fundings, disbursements, settlements and payments in
Dollars in respect of any such Eurodollar Loan, or any other dealings in Dollars
to be carried out pursuant to this Agreement in respect of any such Eurodollar
Loan, means any such day on which dealings in deposits in Dollars are conducted
by and between banks in the London interbank eurodollar market;

(b) if such day relates to any interest rate settings as to a Eurodollar Loan
denominated in Euro, any fundings, disbursements, settlements and payments in
Euro in respect of any such Eurodollar Loan, or any other dealings in Euro to be
carried out pursuant to this Agreement in respect of any such Eurodollar Loan,
means (i) a TARGET Day and (ii) a day on which banks are open for general
business in London;

(c) if such day relates to any interest rate settings as to a Eurodollar Loan
denominated in Sterling, means any such day on which dealings in deposits in
Sterling are conducted by and between banks in the London or other applicable
offshore interbank market for Sterling; and

(d) if such day relates to any fundings, disbursements, settlements and payments
in Sterling in respect of a Eurodollar Loan denominated in Sterling, or any
other dealings in Sterling to be carried out pursuant to this Agreement in
respect of any such Eurodollar Loan (other than any interest rate settings),
means any such day on which banks are open for foreign exchange business in
London.

“Capital Assets” shall mean with respect to any Person, all equipment, fixed
assets and Real Property or improvements of such Person, or replacements or
substitutions therefor or additions thereto, that, in accordance with GAAP, have
been or should be reflected as additions to property, plant or equipment on the
balance sheet of such Person.

“Capital Expenditures” shall mean with respect to any Person for any period, all
expenditures made directly or indirectly by such Person during such period for
Capital Assets related to maintaining, replacing or repairing existing property
or assets (including any Dialysis Facility) of such Person (whether paid in cash
or other consideration or accrued as a liability), but, for the avoidance of
doubt, excluding any Investments permitted by Section 7.6(e), (f) or (k) and
development of the Denver Headquarters. For purposes of this definition, the
purchase price of equipment or other fixed assets that are purchased
simultaneously with the trade-in of existing assets or with insurance proceeds
shall be included in Capital Expenditures only to the extent of the amount by
which such purchase price exceeds the credit granted by the seller of such
assets for the assets being traded in at such time or the amount of such
insurance proceeds, as the case may be.

“Capital Stock” shall mean any and all shares, interests, participations or
other equivalents (however designated) of capital stock of a corporation, any
and all equivalent ownership interests in a Person (other than a corporation)
and any and all warrants, rights or options to purchase any of the foregoing.

“Capitalized Lease” shall mean any lease with respect to which the lessee is
required to recognize concurrently the acquisition of property or an asset and
the incurrence of a liability in accordance with GAAP (provided that, each
reference in this Agreement to a “Capitalized Lease” shall be determined based
on GAAP as in effect on the date of this Agreement; provided that if there is a
change in GAAP with respect to “Capitalized Leases” after the date of this
Agreement, the Borrower shall provide to the Administrative Agent and the
Lenders a written reconciliation between the calculation of any affected item in
amounts required to be reported under Sections 6.01(b) and (c) (including any
Compliance Certificate) before and after giving effect to such change in GAAP).

 

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“Capitalized Lease Obligations” shall mean with respect to any Capitalized
Lease, the amount required to be capitalized in the financial statements of the
lessee in accordance with GAAP (provided that, each reference in this Agreement
to “Capitalized Lease Obligations” shall be determined based on GAAP as in
effect on the date of this Agreement; provided that if there is a change in GAAP
with respect to “Capitalized Lease Obligations” after the date of this
Agreement, the Borrower shall provide to the Administrative Agent and the
Lenders a written reconciliation between the calculation of any affected item in
amounts required to be reported under Sections 6.01(b) and (c) (including any
Compliance Certificate) before and after giving effect to such change in GAAP).

“Cash Equivalents” shall mean (a) securities with maturities of one year or less
from the date of acquisition, issued, fully guaranteed or insured by the United
States of America (or any agency or instrumentality thereof), or any foreign
government or supranational organization, in each case, rated AAA by S&P and Aaa
by Moody’s, (b) securities with maturities of one year or less from the date of
acquisition issued, fully guaranteed by any State of the United States of
America or any political subdivision thereof either (i) rated at least AA- or
SP1 by S&P or Aa3 or MIG1 by Moody’s, or carrying an equivalent rating by a
nationally recognized rating agency if both of the two named rating agencies
cease publishing ratings of investments or (ii) fully collateralized by
securities described in clause (a) and/or cash, (c) certificates of deposit,
time deposits, overnight bank deposits, bankers’ acceptances and repurchase
agreements issued by a Qualified Issuer or fully insured or guaranteed by the
United States of America (or any agency or instrumentality thereof) to the
extent the same are backed by the full faith and credit of the United States of
America having maturities of 270 days or less from the date of acquisition,
(d) commercial paper of an issuer rated at least A-2 by S&P or P-2 by Moody’s,
or carrying an equivalent rating by a nationally recognized rating agency if
both of the two named rating agencies cease publishing ratings of investments,
and having maturities of 270 days or less from the date of acquisition,
(e) money market accounts or funds, a substantial portion of the assets of which
constitute Cash Equivalents described in clauses (a) through (d) above, with,
issued by or managed by Qualified Issuers, (f) money market accounts or funds, a
substantial portion of the assets of which constitute Cash Equivalents described
in clauses (a) through (d) above, which money market accounts or funds have net
assets of not less than $500,000,000 and have the highest rating available of
either S&P or Moody’s, or carrying an equivalent rating by a nationally
recognized rating agency if both of the two named rating agencies cease
publishing ratings of investments and (g) money market accounts or funds rated
at least AA by S&P and at least Aa by Moody’s.

“Cash Flow from Operating Activities” shall mean the net cash provided by
operating activities of the Borrower and its Subsidiaries, determined on a
Consolidated basis in accordance with GAAP, as set forth on the financial
statements delivered by the Borrower pursuant to Section 6.1(b).

“Cash Management Agreement” shall mean any agreement to provide cash management
services, including treasury, depository, overdraft, purchasing card, travel and
entertainment card, credit or debit card, electronic funds transfer and other
cash management arrangements.

“Cash Management Bank” shall mean any Person that, at the time it enters into a
Cash Management Agreement, is a Lender or an Affiliate of a Lender, in its
capacity as a party to such Cash Management Agreement.

“CERCLA” shall mean the Comprehensive Environmental Response, Compensation, and
Liability Act of 1980, as amended, 42 U.S.C. § 9601 et seq., and all
implementing regulations.

“CERCLIS” shall mean the Comprehensive Environmental Response, Compensation and
Liability Information System maintained by the U.S. Environmental Protection
Agency.

 

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“Change in Law” shall have the meaning given to such term in Section 2.18(b).

“Change of Control” shall mean at any time:

(a) any “person” or “group” (each as used in Sections 13(d)(3) and 14(d)(2) of
the Exchange Act) (i) becomes the “beneficial owner” (as defined in Rule 13d-3
of the Exchange Act), directly or indirectly, of Voting Interests in the
Borrower (including through securities convertible into or exchangeable for such
Voting Interests) representing 35% or more of the combined voting power of all
of the Voting Interests in the Borrower (on a fully diluted basis) or
(ii) otherwise has the ability, directly or indirectly, to elect a majority of
the Board of Directors of the Borrower;

(b) during any period of two consecutive years, individuals who at the beginning
of such period constituted the Board of Directors of the Borrower (together with
any new directors whose election to such Board of Directors or whose nomination
for election was approved by a vote of a majority of the members of the Board of
Directors of the Borrower, which members comprising such majority were either
directors at the beginning of such period or were elected or nominated by such
directors) have ceased for any reason to constitute a majority of the Board of
Directors of the Borrower; or

(c) the occurrence of a Specified Change of Control;

provided that notwithstanding the foregoing the occurrence of a reorganization
that results in all the Capital Stock of the Borrower being held by a Parent
Entity shall not result in a Change of Control; provided further that the
shareholders of the Parent Entity immediately after such reorganization are
substantially the same as the shareholders of the Borrower (with substantially
equivalent ownership percentages) immediately preceding such reorganization.

“Charges” shall have the meaning given to such term in Section 11.18.

“Closing Date” shall mean the date on which the conditions precedent set forth
in Sections 5.1 and 5.2 shall have been satisfied.

“Code” shall mean the Internal Revenue Code of 1986, as amended from time to
time.

“Collateral” shall mean all property of the Loan Parties, now owned or hereafter
acquired, upon which a Lien is purported to be created by any Security Document.

“Collateral Agent” shall mean JPMorgan Chase Bank, N.A., in its capacity as
collateral agent for the Secured Parties and the Issuing Lender, and its
successors.

“Commitment” shall mean as to any Lender, the sum of the Tranche A Term
Commitment, the Tranche B Term Commitment and the Revolving Commitments of such
Lender and any Commitment extended by such Lender as provided in Section 2.24.

“Commitment Fee Rate” shall mean  1/2 of 1% per annum; provided that on and
after the first Adjustment Date occurring after the completion of the first
Fiscal Quarter of the Borrower ending at least three months after the Closing
Date, the Commitment Fee Rate will be determined pursuant to the Pricing Grid.

“Communications” shall have the meaning given to such term in Section 11.2(d).

 

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“Compliance Certificate” shall mean a certificate duly executed by a Responsible
Officer substantially in the form of Exhibit B.

“Conduit Lender” shall mean any special purpose corporation organized and
administered by any Lender for the purpose of making Loans otherwise required to
be made by such Lender and designated by such Lender in a written instrument;
provided that the designation by any Lender of a Conduit Lender shall not
relieve the designating Lender of any of its obligations to fund a Loan under
this Agreement if, for any reason, its Conduit Lender fails to fund any such
Loan, and the designating Lender (and not the Conduit Lender) shall have the
sole right and responsibility to deliver all consents and waivers required or
requested under this Agreement with respect to its Conduit Lender, and provided,
further, that no Conduit Lender shall (a) be entitled to receive any greater
amount pursuant to Section 2.18, 2.19, 2.20 or 11.5 than the designating Lender
would have been entitled to receive in respect of the extensions of credit made
by such Conduit Lender or (b) be deemed to have any Commitment.

“Confidential Information Memorandum” shall mean the Confidential Information
Memorandum dated October 2010, and furnished to certain Lenders.

“Consolidated” or “consolidated” shall mean the consolidation of accounts in
accordance with GAAP.

“Consolidated Current Assets” shall mean at any date, all amounts (other than
cash and Cash Equivalents) that would, in conformity with GAAP, be set forth
opposite the caption “total current assets” (or any like caption) on a
consolidated balance sheet of the Borrower and its Subsidiaries at such date.

“Consolidated Current Liabilities” shall mean at any date, all amounts that
would, in conformity with GAAP, be set forth opposite the caption “total current
liabilities” (or any like caption) on a consolidated balance sheet of the
Borrower and its Subsidiaries at such date, but excluding (a) the current
portion of any Funded Debt of the Borrower and its Subsidiaries and (b) without
duplication of clause (a) above, all Debt consisting of Revolving Loans or
Swingline Loans to the extent otherwise included therein.

“Consolidated EBITDA” shall mean with respect to any Person for any period, the
amount equal to the sum of (a) the Consolidated Net Income of such Person and
its Subsidiaries for such period plus (b) the sum of each of the following
expenses that have been deducted in the determination of the Consolidated Net
Income of such Person and its Subsidiaries for such period: (i) the Consolidated
Interest Expense of such Person and its Subsidiaries for such period and any
cash charges for refinancing any of the Obligations, (ii) all income tax expense
(whether federal, state, local, foreign or otherwise) of such Person and its
Subsidiaries for such period, (iii) all depreciation expense of such Person and
its Subsidiaries for such period, (iv) all amortization expense of such Person
and its Subsidiaries for such period, (v) cash fees, expenses, charges, debt
extinguishment costs and other costs incurred in connection with the
Transactions; provided that such fees, expenses, charges and costs are expensed
before January 1, 2011, (vi) all non-cash charges otherwise deducted in
determining the Consolidated Net Income of such Person and its Subsidiaries for
such period (excluding any non-cash charge that results in an accrual of a
reserve for cash charges in any future period or amortization of a prepaid cash
expense that was paid in a prior period not included in the calculation);
provided that for any period, the amount of non-cash charges arising from the
write-off of current assets shall not be included in this subclause (vi),
(vii) consolidated expenses for valuation adjustments or impairment charges,
(viii) all expenses and charges relating to non-controlling interests and equity
income in Subsidiaries, (ix) all extraordinary losses subtracted in determining
the Consolidated Net Income of such Person and its Subsidiaries for such period,
(x) any losses of a Person (other than a Subsidiary) in which the Borrower or
any of its Subsidiaries has an ownership interest

 

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that is accounted for using the equity method and (xi) cash fees, expenses,
charges, debt extinguishment costs and other costs incurred in connection with
any Investments permitted by Section 7.6(e), (f) or (j) minus (c) all
extraordinary gains added in determining the Consolidated Net Income of such
Person and its Subsidiaries for such period, minus (d) the aggregate amount of
all non-cash items increasing Consolidated Net Income (other than the accrual of
revenue or recording of receivables in the ordinary course of business) for such
period.

For purposes of the Pricing Grid and Section 7 only, Consolidated EBITDA shall
be calculated on a Pro Forma Basis to give effect to (a) any acquisition of any
Subsidiary permitted under Section 7.6(e) or (j) and (b) Asset Sales (in each
case, only to the extent Consolidated EBITDA can be ascertained in respect of
such acquisition or Asset Sale) consummated at any time on or after the first
day of the Measurement Period thereof as if each such acquisition had been
effected on the first day of such period and as if each such Asset Sale had been
consummated on the day prior to the first day of such period.

“Consolidated Interest Coverage Ratio” shall mean for any period, the ratio of
(a) Consolidated EBITDA for such period to (b) Consolidated Interest Expense for
such period.

“Consolidated Interest Expense” shall mean with respect to any Person for any
period, the gross interest expense accrued on all Debt of such Person and its
Subsidiaries during such period, determined on a Consolidated basis and in
accordance with GAAP for such period, including, without limitation, (a) in the
case of the Borrower, all fees paid or payable pursuant to Section 2.8,
(b) commissions, discounts and other fees and charges paid or payable in
connection with letters of credit (including, without limitation, the Letters of
Credit), (c) all amortization of original issue discount in respect of all Debt
of such Person and its Subsidiaries, (d) all dividends on Redeemable Preferred
Interests, to the extent paid or payable in cash, (e) commissions, discounts,
yield and other fees and charges incurred in connection with any Permitted
Receivables Financing which are payable to any Person other than the Borrower or
a Guarantor, (f) imputed interest on Capitalized Lease Obligations of the
Borrower and its Subsidiaries for such period and (g) cash contributions to any
employee stock ownership plan or similar trust to the extent such contributions
are used by such plan or trust to pay interest or fees to any Person (other than
such Person and its Subsidiaries) in connection with Debt incurred by such plan
or trust, minus interest income of the Borrower and its Subsidiaries received
upon cash and Cash Equivalents during such period.

For purposes of the Pricing Grid and Section 7 only, Consolidated Interest
Expense shall be calculated on a Pro Forma Basis to give effect to any Debt
incurred, assumed or permanently repaid or extinguished during the relevant
Measurement Period in connection with (a) any acquisitions of any Subsidiary
permitted under Section 7.6(e) or (k) and (b) Asset Sales as if such incurrence,
assumption, repayment or extinguishing had been effected on the first day of
such period; it being understood that for purposes of such calculations any Debt
newly incurred during such Measurement Period that bears interest at a floating
rate will be assumed to bear interest for the entire Measurement Period at the
rate borne by such Debt on the date of incurrence. For all purposes under this
Agreement and notwithstanding anything in the foregoing to the contrary (but
subject to the immediately preceding sentence), Consolidated Interest Expense
shall mean (a) for the Measurement Period ending December 31, 2010, Consolidated
Interest Expense for the Fiscal Quarter ending December 31, 2010 (“First Quarter
Consolidated Interest Expense”), multiplied by 4, (b) for the Measurement Period
ending March 31, 2011, the sum of First Quarter Consolidated Interest Expense
plus Consolidated Interest Expense for the Fiscal Quarter ending March 31, 2011
(“Second Quarter Consolidated Interest Expense”), multiplied by 2, and (c) for
the Measurement Period ending June 30, 2011, the sum of First Quarter
Consolidated Interest Expense, Second Quarter Consolidated Interest Expense and
Consolidated Interest Expense for the Fiscal Quarter ending June 30, 2011,
divided by 3, multiplied by 4.

 

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“Consolidated Net Income” shall mean for any period, the consolidated net income
(or net loss) of the Borrower and its Subsidiaries, determined on a Consolidated
basis in accordance with GAAP; provided that there shall be excluded (a) the
income (or deficit) of any Person accrued prior to the date it becomes a
Subsidiary of the Borrower or is merged into or consolidated with the Borrower
or any of its Subsidiaries (provided that such income (or deficit) may be
included in pro forma calculations as otherwise provided in this Agreement),
(b) the income (or deficit) of any Person (other than a Subsidiary of the
Borrower) in which the Borrower or any of its Subsidiaries has an ownership
interest, except to the extent that any such income is actually received by the
Borrower or such Subsidiary in the form of dividends or similar distributions
and (c) the undistributed earnings of any Subsidiary of the Borrower to the
extent that the declaration or payment of dividends or similar distributions by
such Subsidiary is not at the time permitted by the terms of any Contractual
Obligation (other than under any Loan Document) or Requirement of Law applicable
to such Subsidiary.

“Consolidated Tangible Assets” shall mean, with respect to any Person, the
consolidated assets of such Person and its Subsidiaries as determined in
accordance with GAAP (and if applicable as appearing within the Required
Financial Information) minus goodwill and other amortizable intangible assets.

“Consolidated Working Capital” shall mean at any date, Consolidated Current
Assets on such date minus Consolidated Current Liabilities on such date.

“Constitutive Documents” shall mean with respect to any Person, the certificate
of incorporation or registration (including, if applicable, certificate of
change of name), articles of incorporation or association, memorandum of
association, charter, bylaws, certificate of limited partnership, partnership
agreement, trust agreement, joint venture agreement, certificate of formation,
articles of organization, limited liability company operating or members
agreement, joint venture agreement or one or more similar agreements,
instruments or documents constituting the organizational or governing documents
of such Person.

“Contingent Obligation” shall mean with respect to any Person, any obligation or
arrangement of such Person to guarantee or intended to guarantee any Debt,
(“primary obligations”) of any other Person (the “primary obligor”) in any
manner, whether directly or indirectly, including, without limitation, (a) the
direct or indirect guarantee, endorsement (other than for collection or deposit
in the ordinary course of business), co-making, discounting with recourse or
sale with recourse by such Person of the primary obligations of a primary
obligor, (b) the obligation to make take-or-pay or similar payments, if
required, regardless of non-performance by any other party or parties to an
agreement or (c) any obligation of such Person, whether or not contingent,
(i) to purchase any such primary obligation or any property constituting direct
or indirect security therefor, (ii) to advance or supply funds (A) for the
purchase or payment of any such primary obligation or (B) to maintain working
capital, equity capital, net worth or other balance sheet condition or any
income statement condition of the primary obligor or otherwise to maintain the
solvency of the primary obligor, (iii) to purchase, lease or otherwise acquire
property, assets, securities or services primarily for the purpose of assuring
the owner of any such primary obligation of the ability of the primary obligor
to make payment of such primary obligation or (iv) otherwise to assure or hold
harmless the holder of such primary obligation against loss in respect thereof.
The amount of any Contingent Obligation shall be deemed to be an amount equal to
the stated or determinable amount of the primary obligation in respect of which
such Contingent Obligation is made (or, if less, the maximum amount of such
primary obligation for which such Person may be liable pursuant to the terms of
the agreement, instrument or other document evidencing such Contingent
Obligation) or, if not stated or determinable, the maximum reasonably
anticipated liability in respect thereof (assuming such Person is required to
perform thereunder), as determined by such Person in good faith.

 

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“Contractual Obligation” shall mean as to any Person, any provision of any
security issued by such Person or of any agreement, instrument or other
undertaking to which such Person is a party or by which it or any of its
property is bound.

“Control” shall mean the possession, directly or indirectly, of the power to
direct or cause the direction of the management or policies of a Person, whether
through the ownership of voting securities, by contract or otherwise, and the
terms “Controlling” and “Controlled” shall have meanings correlative thereto.

“Credit Extension” shall mean as the context may require, (i) the making of a
Loan by a Lender or (ii) the issuance of any Letter of Credit, or the amendment,
extension or renewal of any existing Letter of Credit, by the Issuing Lender.

“Credit Party” shall mean the Administrative Agent, the Issuing Lender, the
Swingline Lender or any other Lender.

“Debt” shall mean with respect to any Person (without duplication), (a) all
indebtedness of such Person for borrowed money, (b) all Obligations of such
Person for the deferred purchase price of property or services (other than
current trade payables or other accrued liabilities incurred in the ordinary
course of such Person’s business, (c) all obligations of such Person evidenced
by notes, bonds, debentures or other similar instruments, or upon which interest
payments are customarily made, (d) all obligations of such Person created or
arising under any conditional sale or other title retention agreement with
respect to property acquired by such Person (even though the rights and remedies
of the seller or lender under such agreement in the event of default are limited
to repossession or sale of such property), (e) all Capitalized Lease Obligations
of such Person, (f) all obligations, contingent or otherwise, of such Person
under acceptance, letter of credit or similar facilities (excluding
reimbursement obligations thereunder to the extent issued in relation to trade
payables and that are discharged within 30 days after they become due), (g) the
amount of all obligations of such Person with respect to the redemption,
repayment or other repurchase of any Redeemable Preferred Interest, valued at
the greater of its voluntary or involuntary liquidation preference plus accrued
and unpaid dividends, (h) for purposes of Section 7.2 and 8.1(f) only, all net
obligations of such Person in respect of Swap Agreements, take-or-pay agreements
or other similar arrangements, (i) all obligations of such Person under any
synthetic lease, tax retention operating lease, off-balance sheet loan or
similar off-balance sheet financing if the transaction giving rise to such
obligation is considered indebtedness for borrowed money for tax purposes but is
classified as an operating lease in accordance with GAAP, (j) all Contingent
Obligations of such Person, and (k) all indebtedness and other payment
obligations referred to in clauses (a) through (j) above of another Person
secured by (or for which the holder of such indebtedness or other payment
obligations has an existing right, contingent or otherwise, to be secured by)
any Lien on property (including, without limitation, accounts and contract
rights) owned by such Person, even though such Person has not assumed or become
liable for the payment of such indebtedness or other payment obligations;
provided that for the purposes of this subclause (k) the amount thereof shall be
equal to the lesser of (i) the amount of such indebtedness or other payment
obligations and (ii) the fair market value of the property subject to such Lien.
The Debt of any Person shall include the Debt of any other entity (including any
partnership in which such Person is a general partner) to the extent such Person
is liable therefor as a result of such Person’s ownership interest in or other
relationship with such entity, except to the extent the terms of such Debt
expressly provide that such Person is not liable therefor. To the extent not
otherwise included, Debt shall include the amount of any Permitted Receivables
Financing. For the avoidance of doubt, and without any implication to the
contrary, no Intercompany Receivables or any transactions giving rise thereto
shall constitute Debt.

 

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“Default” shall mean any Event of Default, whether or not any requirement for
the giving of notice, the lapse of time, or both, has been satisfied.

“Defaulting Lender” shall mean any Lender that (a) has failed, within two
Business Days of the date required to be funded or paid, to (i) fund any portion
of its Loans, (ii) fund any portion of its participations in Letters of Credit
or Swingline Loans or (iii) pay over to any Credit Party any other amount
required to be paid by it hereunder, unless, in the case of clause (i) above,
such Lender notifies the Administrative Agent in writing that such failure is
the result of such Lender’s good faith determination that a condition precedent
to funding (specifically identified and including the particular default, if
any) has not been satisfied, or, in the case of clause (iii) above, such Lender
notifies the Administrative Agent in writing that such failure is the result of
such Lender’s good faith dispute concerning the amount of costs and expenses
claimed by the Administrative Agent to be reimbursed pursuant to
Section 11.5(c), (b) has notified the Borrower or any Credit Party in writing,
or has made a public statement to the effect, that it does not intend or expect
to comply with any of its funding obligations under this Agreement (unless such
writing or public statement indicates that such position is based on such
Lender’s good faith determination that a condition precedent (specifically
identified and including the particular default, if any) to funding a loan under
this Agreement cannot be satisfied) or generally under other agreements in which
it commits to extend credit, (c) has failed, within three Business Days after
request by a Credit Party, acting in good faith, to provide a certification in
writing from an authorized officer of such Lender that it will comply with its
obligations (and is financially able to meet such obligations) to fund
prospective Loans and participations in then outstanding Letters of Credit and
Swingline Loans under this Agreement; provided that such Lender shall cease to
be a Defaulting Lender pursuant to this clause (c) upon such Credit Party’s
receipt of such certification in form and substance satisfactory to it and the
Administrative Agent; or (d) has become the subject of a Bankruptcy Event.

“Denver Headquarters” shall mean that certain real property owned by the
Borrower and located at 2000 16th Street, Denver, Colorado.

“Designated Non-Cash Consideration” shall mean the fair market value of non-cash
consideration as determined by the Borrower in good faith received by the
Borrower or any of its Subsidiaries in connection with a lease, sale, transfer
or other disposition of any assets pursuant to Section 7.5(f) that is designated
as Designated Non-Cash Consideration pursuant to a certificate of a Responsible
Officer of the Borrower, setting forth the basis of such valuation.

“Dialysis Facilities” shall have the meaning given to such term in
Section 4.17(a).

“Disposition” shall mean with respect to any property, any sale, lease, sale and
leaseback, assignment, conveyance, transfer or other disposition thereof. The
terms “Dispose” and “Disposed of” shall have correlative meanings.

“Disqualified Lenders” shall mean those Persons who are competitors of the
Borrower and who are identified in writing to the Administrative Agent for
further distribution to the Lenders; provided that, with respect to any
competitor identified in writing to the Administrative Agent after the Closing
Date, if the Required Lenders instruct the Administrative Agent to object to
such competitor within 60 days after receipt of such identification by the
Borrower, such competitor shall not be a “Disqualified Lender” hereunder.

“Documentation Agents” shall have the meaning given to such term in the preamble
hereto.

“Dollars” and “$” shall mean lawful currency of the United States.

 

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“Dollar Equivalent” shall mean at any time, (a) with respect to any amount
denominated in Dollars, such amount, and (b) with respect to any amount
denominated in any Alternative Currency (other than Dollars), the equivalent
amount thereof in Dollars as determined by the Administrative Agent at such time
on the basis of the Spot Rate (determined in respect of the most recent
Revaluation Date) for the purchase of Dollars with such Alternative Currency.

“Dollar Revolving Commitment” shall mean, as to any Lender, the obligation of
such Lender, if any, to make Dollar Revolving Loans in an aggregate principal
and/or face amount not to exceed the amount set forth under the heading “Dollar
Revolving Commitment” on such Lender’s Addendum, in an Increase Joinder or in
the Assignment and Assumption pursuant to which such Lender became a party
hereto, as the same may be changed from time to time pursuant to the terms
hereof.

“Dollar Revolving Extensions of Credit” shall mean, as to any Dollar Revolving
Lender at any time, an amount equal to the aggregate principal amount of all
Dollar Revolving Loans held by such Lender then outstanding.

“Dollar Revolving Facility” shall mean the Dollar Revolving Commitments and the
Dollar Revolving Loans made thereunder.

“Dollar Revolving Lender” shall mean each Lender that has a Dollar Revolving
Commitment or holds Dollar Revolving Loans.

“Dollar Revolving Loans” shall have the meaning given to such term in
Section 2.4(a).

“Dollar Revolving Percentage” shall mean, as to any Dollar Revolving Lender at
any time, the percentage which such Lender’s Dollar Revolving Commitment then
constitutes of the Total Dollar Revolving Commitments or, at any time after the
Dollar Revolving Commitments shall have expired or terminated, the percentage
which the aggregate principal amount of such Lender’s Dollar Revolving Loans
then outstanding constitutes of the aggregate principal amount of the Dollar
Revolving Loans then outstanding; provided that, in the event that the Dollar
Revolving Loans are paid in full prior to the reduction to zero of the Total
Dollar Revolving Extensions of Credit, the Dollar Revolving Percentages shall be
the Dollar Revolving Percentages in effect immediately prior to such payment in
full.

“Domestic Person” shall mean a Person that is organized under the laws of, or
whose property is located in, a jurisdiction within the United States.

“Domestic Subsidiary” shall mean any Subsidiary of the Borrower organized under
the laws of any jurisdiction within the United States.

“ECF Percentage” shall mean (i) with respect to any Fiscal Year at the end of
which the Leverage Ratio is greater than 4.0 to 1.00, 25%; and (ii) with respect
to any Fiscal Year at the end of which the Leverage Ratio is less than or equal
to 4.0 to 1.00, 0%.

“Embargoed Person” shall have the meaning assigned to such term in Section 7.15.

“EMU” shall mean the economic and monetary union in accordance with the Treaty
of Rome 1957, as amended by the Single European Act 1986, the Maastricht Treaty
of 1992 and the Amsterdam Treaty of 1998.

“EMU Legislation” shall mean the legislative measures of the European Council
for the introduction of, changeover to or operation of a single or unified
European currency.

 

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“Environmental Action” shall mean any outstanding action, suit, demand, demand
letter, claim, notice of noncompliance or violation, notice of liability or
potential liability, investigation, proceeding, consent order or consent
agreement, abatement order or other order or directive (conditional or
otherwise) relating in any way to any Environmental Law, any Environmental
Permit or any Hazardous Materials or arising from alleged injury or threat to
health, safety, natural resources or the environment, including, (a) by any
Governmental Authority for enforcement, cleanup, removal, response, remedial or
other actions or damages and (b) by any applicable Governmental Authority or any
other third party for damages, contribution, indemnification, cost recovery,
compensation or injunctive relief.

“Environmental Law” shall mean any Requirement of Law relating to (a) the
generation, use, handling, transportation, treatment, storage, disposal or
Release of Hazardous Materials, (b) pollution or the protection of the
Environment or health or safety or (c) occupational safety and health,
industrial hygiene, land use or the protection of human, plant or animal health
or welfare, including, without limitation, CERCLA, in each case as amended from
time to time, and including the regulations promulgated and the rulings issued
from time to time thereunder.

“Environment” shall mean ambient air, indoor air, surface water, groundwater,
drinking water, soil, land surface and subsurface strata, and natural resources
such as wetlands, flora and fauna.

“Environmental Liability” shall mean any liability, contingent or otherwise
(including any liability for damages, costs of environmental remediation, fines,
penalties or indemnities), of any Group Member directly or indirectly resulting
from or based upon (a) violation of any Environmental Law, (b) the generation,
use, handling, transportation, storage or treatment of any Hazardous Materials,
(c) exposure to any Hazardous Materials, (d) the Release or threatened Release
of any Hazardous Materials or (e) any contract, agreement or other consensual
arrangement pursuant to which liability is assumed or imposed with respect to
any of the foregoing.

“Environmental Permit” shall mean any permit, approval, identification number,
license or other authorization required under any Environmental Law.

“ERISA” shall mean the Employee Retirement Income Security Act of 1974, as
amended from time to time.

“ERISA Affiliate” shall mean any Person that for purposes of Title IV of ERISA
is a member of the controlled group of any Loan Party, or under common control
with any Loan Party, within the meaning of Section 414 of the Code.

“ERISA Event” shall mean (a) (i) the occurrence of a reportable event, within
the meaning of Section 4043 of ERISA, with respect to any Plan unless the 30-day
notice requirement with respect to such event has been waived by the PBGC under
the regulations in effect on the date hereof or (ii) the requirements of
Section 4043(b) of ERISA are met with respect to a contributing sponsor, as
defined in Section 4001(a)(13) of ERISA, of a Plan, and an event described in
paragraph (9), (10), (11), (12) or (13) of Section 4043(c) of ERISA could
reasonably be expected to occur with respect to such Plan within the following
30 days; (b) with respect to any Plan, the failure to satisfy the minimum
funding standard under Section 412 of the Code and Section 302 of ERISA, whether
or not waived, or the failure to make any required contribution to a
Multiemployer Plan; (c) the application for a minimum funding waiver with
respect to a Plan; (d) the provision by the administrator of any Plan of a
notice of intent to terminate such Plan pursuant to Section 4041(a)(2) of ERISA
(including any such notice with respect to a plan amendment referred to in
Section 4041(e) of ERISA); (e) the cessation of operations at a facility of any
Loan Party or any ERISA Affiliate in the circumstances described in
Section 4062(e) of ERISA; (f) the partial or complete withdrawal by any Loan
Party or any ERISA Affiliate from a Multiemployer Plan; (g) the

 

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conditions for imposition of a lien under Section 303(k) of ERISA shall have
been met with respect to any Plan; (h) the institution by the PBGC of
proceedings to terminate a Plan pursuant to Section 4042 of ERISA, or the
occurrence of any event or condition described in Section 4042 of ERISA, that
constitutes grounds for the termination of, or the appointment of a trustee to
administer, a Plan; or (i) the occurrence of a nonexempt prohibited transaction
with respect to an employee benefit plan maintained or contributed to by a Group
Member (within the meaning of Section 4975 of the Code or Section 406 of ERISA)
which could result in material liability to any Loan Party.

“Euro” and “€” shall mean the lawful currency of the Participating Member States
introduced in accordance with the EMU Legislation.

“Eurocurrency Reserve Requirements” shall mean for any day as applied to a
Eurodollar Loan, the aggregate (without duplication) of the maximum rates
(expressed as a decimal fraction) of reserve requirements in effect on such day
(including basic, supplemental, marginal and emergency reserves) under any
regulations of the Board or other Governmental Authority having jurisdiction
with respect thereto dealing with reserve requirements prescribed for
eurocurrency funding (currently referred to as “Eurocurrency Liabilities” in
Regulation D of the Board) maintained by a member bank of the Federal Reserve
System.

“Eurodollar Base Rate” shall mean with respect to each day during each Interest
Period pertaining to a Eurodollar Loan, the rate per annum determined on the
basis of the rate for deposits in relevant currency for a period equal to such
Interest Period commencing on the first day of such Interest Period appearing on
Reuters Screen LIBOR01 Page as of 11:00 A.M., London time, two Business Days
prior to the beginning of such Interest Period. In the event that such rate does
not appear on Reuters Screen LIBOR01 Page (or otherwise on such screen), the
“Eurodollar Base Rate” shall be determined by reference to such other comparable
publicly available service for displaying eurodollar rates as may be selected by
the Administrative Agent or, in the absence of such availability, by reference
to the rate at which the Person serving as Administrative Agent is offered
deposits in the relevant currency at or about 11:00 A.M., New York City time,
two Business Days prior to the beginning of such Interest Period in the
interbank eurodollar market where its eurodollar and foreign currency and
exchange operations are then being conducted for delivery on the first day of
such Interest Period for the number of days comprised therein. Notwithstanding
the foregoing, the Eurodollar Base Rate with respect to any Tranche B Term Loan
for any applicable Interest Period will be deemed to be 1.50% per annum if the
Eurodollar Base Rate for such Interest Period determined pursuant to this
definition would otherwise be less than 1.50% per annum.

“Eurodollar Loans” shall mean Loans the rate of interest applicable to which is
based upon the Eurodollar Rate. Eurodollar Loans may be denominated in Dollars
or an Alternative Currency (other than Dollars).

“Eurodollar Rate” shall mean, with respect to each day during each Interest
Period pertaining to a Eurodollar Loan, a rate per annum determined for such day
in accordance with the following formula (rounded upward to the nearest 1/100th
of 1%):

 

Eurodollar Base Rate

1.00 - Eurocurrency Reserve Requirements

“Eurodollar Tranche” shall mean, collectively, Eurodollar Loans under a
particular Facility the then current Interest Periods with respect to all of
which begin on the same date and end on the same later date (whether or not such
Loans shall originally have been made on the same day).

 

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“Events of Default” shall have the meaning given to such term in Section 8.1.

“Excess Cash Flow” shall mean, for any Fiscal Year of the Borrower, the excess,
if any, of (a) Cash Flow from Operating Activities over (b) the sum, without
duplication, of (i) the aggregate amount (A) actually paid by the Borrower and
its Subsidiaries during such Fiscal Year and (B) expected as of the last day of
such Fiscal Year to be paid in the first Fiscal Quarter following such Fiscal
Year, on account of Capital Expenditures or any other expenditures for Capital
Assets (excluding the principal amount of Debt incurred in connection with such
expenditures and any such expenditures financed with the proceeds of any
Reinvestment Deferred Amount); provided that (I) any amount deducted on account
of such committed expenditure pursuant to clause (B) shall not be deducted in
the calculation of Excess Cash Flow for the following Fiscal Year to the extent
such amount is actually paid in the first Fiscal Quarter of the following Fiscal
Year, and (II) to the extent any such committed amount is not actually paid in
the first Fiscal Quarter of the following Fiscal Year, such unspent amount shall
not be deducted in the calculation of Excess Cash Flow for the preceding Fiscal
Year, (ii) the aggregate amount of all prepayments of Revolving Loans and
Swingline Loans during such Fiscal Year to the extent of accompanying permanent
optional reductions of the Revolving Commitments and all optional prepayments of
the Term Loans during such Fiscal Year, (iii) the aggregate amount of all
regularly scheduled principal payments of Funded Debt (including the Term Loans)
of the Borrower and its Subsidiaries made during such Fiscal Year (other than in
respect of any revolving credit facility to the extent there is not an
equivalent permanent reduction in commitments thereunder), (iv) the aggregate
amount actually paid during such Fiscal Year, or expected to be paid in the
first Fiscal Quarter of the following Fiscal Year pursuant to letters of intent
or acquisition agreements, on Investments pursuant to Sections 7.6(e), (f) and
(j) pursuant to this clause (iv) without giving effect to any part of an
Investment that was permitted by utilizing the Available Amount; provided that
(I) any amount deducted on account of such letter of intent or acquisition
agreement shall not be deducted in the calculation of Excess Cash Flow for the
following Fiscal Year to the extent such amount is actually paid in the first
Fiscal Quarter of the following Fiscal Year and (II) to the extent any such
committed amount is not actually paid in the first Fiscal Quarter of the
following Fiscal Year, such unspent amount shall not be deducted in the
calculation of Excess Cash Flow for the preceding Fiscal Year and (v) the
aggregate amount of distributions on account of non-controlling interests in
Subsidiaries.

“Excess Cash Flow Application Date” shall have the meaning given to such term in
Section 2.11(c).

“Exchange Act” shall mean the Securities Exchange Act of 1934, as amended from
time to time, and the regulations promulgated and the rulings issued thereunder.

“Executive Order” shall have the meaning given to such term in Section 4.23.

“Existing Credit Agreement” shall have the meaning given to such term in the
recitals hereto.

“Existing Issuing Bank” shall mean each bank which issued Existing Letters of
Credit.

“Existing Letters of Credit” shall mean all letters of credit outstanding on the
Closing Date, as more fully described on Schedule 1.1 hereto.

“Existing Notes” shall have the meaning given to such term in the recitals
hereto.

“Existing Senior Notes” shall have the meaning given to such term in the
recitals hereto.

 

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“Existing Senior Subordinated Notes” shall have the meaning given to such term
in the recitals hereto.

“Extended Revolving Commitment” shall have the meaning given to such term in
Section 2.25(a).

“Extended Term Loans” shall have the meaning given to such term in
Section 2.25(a).

“Extending Revolving Lender” shall have the meaning given to such term in
Section 2.25(a).

“Extending Term Lender” shall have the meaning given to such term in
Section 2.25(a).

“Extension” shall have the meaning given to such term in Section 2.25(a).

“Extension Offer” shall have the meaning given to such term in Section 2.25(a).

“Facility” shall mean each of (a) the Tranche A Term Commitments and the Tranche
A Term Loans made thereunder (the “Tranche A Term Facility”), (b) the Tranche B
Term Commitments and the Tranche B Term Loans made thereunder (the “Tranche B
Term Facility”), (c) the Revolving Facility, (d) the Extended Term Loans, if
any, and (e) the Extended Revolving Commitments, if any, as the case may be.

“Federal Funds Effective Rate” shall mean for any day, the weighted average of
the rates on overnight federal funds transactions with members of the Federal
Reserve System arranged by federal funds brokers, as published on the next
succeeding Business Day by the Federal Reserve Bank of New York, or, if such
rate is not so published for any day that is a Business Day, the average of the
quotations for the day of such transactions received by the Administrative Agent
from three federal funds brokers of recognized standing selected by it.

“Fee Payment Date” shall mean (a) the third Business Day following the last day
of each March, June, September and December and (b) the last day of the
Revolving Commitment Period.

“FIRREA” shall mean the Financial Institutions Reform, Recovery and Enforcement
Act of 1989, as amended.

“Fiscal Quarter” shall mean with respect to the Borrower or any of its
Subsidiaries, the period commencing January 1 in any Fiscal Year and ending on
the next succeeding March 31, the period commencing April 1 in any Fiscal Year
and ending on the next succeeding June 30, the period commencing July 1 in any
Fiscal Year and ending on the next succeeding September 30 or the period
commencing October 1 in any Fiscal Year and ending on the next succeeding
December 31, as the context may require, or, if any such Subsidiary was not in
existence on the first day of any such period, the period commencing on the date
on which such Subsidiary is incorporated, organized, formed or otherwise created
and ending on the last day of such period.

“Fiscal Year” shall mean with respect to the Borrower or any of its
Subsidiaries, the period commencing on January 1 in any calendar year and ending
on the next succeeding December 31 or, if any such Subsidiary was not in
existence on January 1 in any calendar year, the period commencing on the date
on which such Subsidiary is incorporated, organized, formed or otherwise created
and ending on the next succeeding December 31.

 

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“Foreign Subsidiary” shall mean any Subsidiary of the Borrower that is not a
Domestic Subsidiary.

“Funded Debt” of any Person shall mean all Debt as set forth on the balance
sheet of such Person determined on a Consolidated basis in accordance with GAAP,
including, without limitation, (i) the aggregate amount of Government
Reimbursement Program Costs (exclusive of, with respect to the determination of
Funded Debt in any period, the portion of Government Reimbursement Program Costs
paid in such period), (ii) in the case of the Borrower, the Loans, (iii) any
Receivables Transaction Amount and (iv) all obligations of such Person to
purchase, redeem, retire, defease or otherwise make any payment in respect of
any preferred Capital Stock in such Person or any other Person; provided,
however, that the term “Funded Debt” shall not include any Contingent
Obligations of such Person (if and to the extent such Contingent Obligations
would otherwise be included in such term on any date of determination) that are
incurred solely to support any obligations, Debt or Government Reimbursement
Program Costs of the Borrower or one or more Subsidiaries of the Borrower to the
extent such Contingent Obligations are otherwise expressly permitted to be
incurred under Section 7.2.

“Funding Office” shall mean with respect to any currency, the office of the
Administrative Agent specified in Section 11.2 or such other office as may be
specified from time to time by the Administrative Agent as its funding office by
written notice to the Borrower and the Lenders.

“GAAP” shall mean generally accepted accounting principles in the United States
as in effect from time to time applied on a consistent basis, subject to
Section 1.4.

“Government Reimbursement Program Costs” shall mean with respect to any payable
of the Borrower and its Subsidiaries, the sum of:

(i) all amounts (including punitive and other similar amounts) agreed to be paid
in settlement or payable as a result of a final, non-appealable judgment, award
or similar order relating to participation in Medical Reimbursement Programs;

(ii) all final, non-appealable fines, penalties, forfeitures or other amounts
rendered pursuant to criminal indictments or other criminal proceedings relating
to participation in Medical Reimbursement Programs; and

(iii) the amount of final, non-appealable recovery, damages, awards, penalties,
forfeitures or similar amounts rendered in any litigation, suit, arbitration,
investigation or other legal or administrative proceeding of any kind relating
to participation in Medical Reimbursement Programs.

“Government Reimbursement Programs” shall have the meaning given to such term in
Section 4.17(a).

“Governmental Authority” shall mean any nation or government, any state or other
political subdivision thereof, any agency, authority, instrumentality,
regulatory body, court, central bank or other entity exercising executive,
legislative, judicial, taxing, regulatory or administrative functions of or
pertaining to government, any securities exchange and any self-regulatory
organization (including the National Association of Insurance Commissioners).

“Governmental Authorization” shall mean any authorization, approval, consent,
franchise, license, covenant, order, ruling, permit, certification, exemption,
notice, declaration or similar right, undertaking or other action of, to or by,
or any filing, qualification or registration with, any Governmental Authority.

 

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“Group Members” shall mean the reference to the Borrower and its Subsidiaries.

“Guaranteed Obligations” shall have the meaning given to such term in
Section 10.1.

“Guarantor” shall mean except as permitted by Section 6.12 or Section 7.12, each
Subsidiary of the Borrower (other than any Special Purpose Receivables
Subsidiary).

“Hazardous Materials” shall mean (a) petroleum or petroleum products,
by-products or breakdown products, radioactive materials, asbestos,
asbestos-containing materials, polychlorinated biphenyls and radon gas and
(b) any other chemicals, materials, substances, wastes (including medical and
human waste), constituents, pollutants or contaminants subject to regulation or
which can give rise to liability under any Environmental Law.

“HIPAA” shall have the meaning given to such term in Section 4.17(b).

“Increase Effective Date” shall have the meaning given to such term in
Section 2.24(a).

“Increase Joinder” shall have the meaning given to such term in Section 2.24(c).

“Incremental Term Loan Commitment” shall have the meaning given to such term in
Section 2.24(a).

“Incremental Term Loans” shall have the meaning given to such term in
Section 2.24(c).

“Indemnitee” shall have the meaning given to such term in Section 11.5(b).

“Information” shall have the meaning given to such term in Section 11.15.

“Insurance Policies” shall mean the insurance policies and coverages required to
be maintained by each Loan Party which is an owner of Mortgaged Property with
respect to the applicable Mortgaged Property pursuant to Section 6.5 and all
renewals and extensions thereof.

“Insurance Requirements” shall mean collectively, all provisions of the
Insurance Policies, all requirements of the issuer of any of the Insurance
Policies and all orders, rules, regulations and any other requirements of the
National Board of Fire Underwriters (or any other body exercising similar
functions) binding upon each Loan Party which is an owner of Mortgaged Property
and applicable to the Mortgaged Property or any use or condition thereof.

“Intellectual Property” shall mean, collectively, all rights, priorities and
privileges relating to intellectual property, whether arising under United
States, multinational or foreign laws or otherwise, including copyrights,
copyright licenses, patents, patent licenses, trademarks, trademark licenses,
trade names, service marks, domain names, trade secrets, proprietary
information, technology, know-how and processes, and all rights to sue at law or
in equity for any infringement or other impairment thereof, including the right
to receive all proceeds and damages therefrom.

“Intercompany Note” shall mean a promissory note substantially in the form of
Exhibit M.

 

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“Intercompany Receivables” shall mean any debits or credits by and among the
Borrower and its Subsidiaries arising in connection with any centralized
purchasing, payment or other cash management or treasury services, in each case,
in the ordinary course of business.

“Interest Election Request” shall mean an Interest Election Request,
substantially in the form of Exhibit P.

“Interest Payment Date” shall mean (a) as to any ABR Loan (other than any
Swingline Loan), the last day of each March, June, September and December to
occur while such Loan is outstanding and the final Maturity Date of the Facility
under which such Loan was made, (b) as to any Eurodollar Loan having an Interest
Period of three months or less, the last day of such Interest Period and the
Maturity Date of the Facility under which such Loan was made, (c) as to any
Eurodollar Loan having an Interest Period longer than three months, each day
that is three months, or a whole multiple thereof, after the first day of such
Interest Period, the last day of such Interest Period and the Maturity Date of
the Facility under which such Loan was made, (d) as to any Loan (other than any
Revolving Loan that is an ABR Loan and any Swingline Loan), the date of any
repayment or prepayment made in respect thereof and (e) as to any Swingline
Loan, the day that such Loan is required to be repaid.

“Interest Period” shall mean as to any Eurodollar Loan, (a) initially, the
period commencing on the borrowing or conversion date, as the case may be, with
respect to such Eurodollar Loan and ending one, two, three or six or (if
available to all Lenders under the relevant Facility) nine or twelve months
thereafter, as selected by the Borrower in its notice of borrowing or notice of
conversion, as the case may be, given with respect thereto; and (b) thereafter,
each period commencing on the last day of the next preceding Interest Period
applicable to such Eurodollar Loan and ending one, two, three or six or (if
available to all Lenders under the relevant Facility) nine or twelve months
thereafter, as selected by the Borrower by irrevocable notice to the
Administrative Agent not later than 11:00 A.M., Local Time, on the date that is
three Business Days prior to the last day of the then current Interest Period
with respect thereto; provided that all of the foregoing provisions relating to
Interest Periods are subject to the following:

(a) if any Interest Period would otherwise end on a day that is not a Business
Day, such Interest Period shall be extended to the next succeeding Business Day
unless the result of such extension would be to carry such Interest Period into
another calendar month in which event such Interest Period shall end on the
immediately preceding Business Day;

(b) the Borrower may not select an Interest Period under a particular Facility
that would extend beyond the Maturity Date of such Facility; and

(c) any Interest Period that begins on the last Business Day of a calendar month
(or on a day for which there is no numerically corresponding day in the calendar
month at the end of such Interest Period) shall end on the last Business Day of
a calendar month.

“Investment” shall mean with respect to any Person, any loan or advance to such
Person, any purchase or other acquisition of Capital Stock or Debt of, or the
property and assets comprising a division or business unit or all or a
substantial part of the business of, such Person, any capital contribution to
such Person or any other investment in such Person, including, without
limitation, any acquisition by way of a merger or consolidation (or similar
transaction) and any arrangement pursuant to which the investor incurs Debt of
the types referred to in clause (j) or (k) of the definition of “Debt” set forth
in this Section 1.1 in respect of such Person, but excluding advances or
extensions of credit to customers and receivables arising in the ordinary course
of business. For the avoidance of doubt, without any implication to the
contrary, no Intercompany Receivables or any transactions giving rise thereto
shall constitute Investments.

 

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“Issuing Lender” shall mean any of (i) JPMorgan Chase Bank, N.A. or any
affiliate thereof, in its capacity as issuer of any Letter of Credit, (ii) any
other Lender reasonably satisfactory to the Administrative Agent that from time
to time agrees in writing to issue Letters of Credit hereunder; provided that,
if any Extension or Extensions of Alternative Currency Revolving Commitments is
or are effected in accordance with Section 2.25, then on the occurrence of the
Revolving Termination Date and on each later date which is or was at any time a
Maturity Date with respect to Alternative Currency Revolving Commitments (each,
an “Issuing Lender/Swingline Termination Date”), each Issuing Lender at such
time shall have the right to resign as an Issuing Lender on, or on any date
within twenty (20) Business Days after, the respective Issuing Lender/Swingline
Termination Date, in each case upon not less than ten (10) days’ prior written
notice thereof to the Borrower and the Administrative Agent and, in the event of
any such resignation and upon the effectiveness thereof, the respective entity
so resigning shall retain all of its rights hereunder and under the other Loan
Documents as an Issuing Lender with respect to all Letters of Credit theretofore
issued by it (which Letters of Credit shall remain outstanding in accordance
with the terms hereof until their respective expirations) but shall not be
required to issue any further Letters of Credit hereunder, and (iii) solely with
respect to the Existing Letters of Credit, each Existing Issuing Bank. If at any
time and for any reason (including as a result of resignations as contemplated
by the last proviso to the preceding sentence), each Issuing Lender has resigned
in such capacity in accordance with the preceding sentence, then no Person shall
be an Issuing Lender hereunder obligated to issue Letters of Credit unless and
until (and only for so long as) a Lender (or affiliate of a Lender) reasonably
satisfactory to the Administrative Agent and the Borrower agrees to act as
Issuing Lender hereunder.

“Issuing Lender/Swingline Termination Date” shall have the meaning given to such
term in the definition of “Issuing Lender.”

“Joinder Agreement” shall mean a joinder agreement substantially in the form of
Exhibit L.

“LC Commitment” shall mean $125,000,000.

“LC Disbursement” shall mean a payment by the Issuing Lender pursuant to a
Letter of Credit.

“LC Obligations” shall mean at any time, an amount equal to the sum of (a) the
aggregate then undrawn and unexpired amount of the then outstanding Letters of
Credit and (b) the aggregate amount of LC Disbursements that have not then been
reimbursed pursuant to Section 3.5. The LC Obligations of any Lender at any time
shall be its Alternative Currency Revolving Percentage of the total LC
Obligations at such time.

“LC Request” shall mean an LC Request, substantially in the form of Exhibit O.

“Lenders” shall have the meaning given to such term in the preamble hereto;
provided that unless the context otherwise requires, each reference herein to
the Lenders shall be deemed to include any Conduit Lender.

“Lending Office” shall mean as to any Lender, the office or offices of such
Lender described as such in such Lender’s Administrative Questionnaire, or such
other office or offices as a Lender may from time to time notify the Borrower
and the Administrative Agent.

 

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“Letters of Credit” shall have the meaning given to such term in Section 3.1(a).

“Leverage Ratio” shall mean at any date of determination, the ratio of
(a) (i) all Funded Debt of the Borrower and its Subsidiaries plus (ii) to the
extent not otherwise included in subclause (a)(i) of this definition, the face
amount of all Letters of Credit issued for the account of the Borrower or any of
its Subsidiaries minus (iii) cash and Cash Equivalents of the Borrower and its
Subsidiaries on a Consolidated basis to (b) Consolidated EBITDA of the Borrower
and its Subsidiaries for the most recently completed Measurement Period prior to
such date.

“Lien” shall mean any mortgage, deed of trust, pledge, hypothecation,
assignment, deposit arrangement, encumbrance, lien (statutory or other), charge
or other security interest or any preference, priority or other security
agreement or preferential arrangement of any kind or nature whatsoever
(including any conditional sale or other title retention agreement and any
capital lease having substantially the same economic effect as any of the
foregoing).

“Loan” shall mean any loan made by any Lender pursuant to this Agreement
(including pursuant to Section 2.24).

“Loan Documents” shall mean this Agreement, the Security Documents and the
Notes.

“Loan Parties” shall mean each Group Member that is a party to a Loan Document.

“Local Time” shall mean the local time in (i) London with respect to Obligations
denominated in an Alternative Currency and (ii) New York City, otherwise.

“Majority Facility Lenders” shall mean with respect to any Facility, the holders
of more than 50% of the aggregate unpaid principal amount of the Term Loans,
Extended Term Loans or the Total Revolving Extensions of Credit, as the case may
be, outstanding under such Facility (or, in the case of the Dollar Revolving
Facility or the Alternative Currency Revolving Facility, prior to any
termination, respectively, of the Dollar Revolving Commitments or the
Alternative Currency Revolving Commitments, the holders of more than 50% of the
Total Dollar Revolving Commitments or Total Alternative Currency Revolving
Commitments, respectively).

“Mandatory Cost” shall mean with respect to any period, the percentage rate per
annum calculated in accordance with Schedule 1.2.

“Mandatory Prepayment Date” shall have the meaning given to such term in
Section 2.11(e).

“Margin Stock” shall mean “margin stock” as defined in Regulation U of the
Board, as the same may be amended or supplemented from time to time.

“Material Adverse Effect” shall mean a material adverse effect on (a) the
business, property, operations, or financial condition of the Borrower and its
Subsidiaries taken as a whole, (b) the validity or enforceability of this
Agreement or any of the other Loan Documents or the rights or remedies of the
Administrative Agent, the Collateral Agent or the Lenders hereunder or
thereunder or (c) the Collateral or the Liens in favor of the Collateral Agent
(for its benefit and for the benefit of the other Secured Parties) on the
Collateral or on the priority of such Liens.

“Material Subsidiary” shall mean, as of any date, (a) any Subsidiary of the
Borrower that accounted for more than 5% of Consolidated Net Income of the
Borrower and its Subsidiaries for the

 

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most recently completed Fiscal Quarter on or prior to such date as reflected in
the Required Financial Information most recently delivered to the Administrative
Agent and the Lenders on or prior to such date and determined in accordance with
GAAP for such period and (b) each other Subsidiary of the Borrower that, when
combined with any other Subsidiary, each of which at the time of determination
is the subject of an Event of Default under Section 8.1(g), would constitute a
Material Subsidiary under clause (a) above.

“Maturity Date” shall mean (i) with respect to the Tranche A Term Loans that
have not been extended pursuant to Section 2.25, the Tranche A Term Loan
Maturity Date, (ii) with respect to the Tranche B Term Loans that have not been
extended pursuant to Section 2.25, the Tranche B Term Loan Maturity Date,
(iii) with respect to the Revolving Commitments that have not been extended
pursuant to Section 2.25, the Revolving Termination Date and (iv) with respect
to any tranche of Extended Term Loans or Extended Revolving Commitments, the
final maturity date as specified in the applicable Extension Offer accepted by
the respective Lender or Lenders; provided that if any such day is not a
Business Day, the applicable Maturity Date shall be the Business Day immediately
succeeding such day.

“Maximum Rate” shall have the meaning given to such term in Section 11.18.

“Measurement Period” shall mean at any date of determination, the most recently
completed four consecutive Fiscal Quarters ended prior to such date for which
financial information is (or is required to be) available.

“Medicaid” shall mean that means-tested entitlement program under Title XIX of
the Social Security Act that provides federal grants to states for medical
assistance based on specific eligibility criteria (Social Security Act of 1965,
Title XIX, P.L. 89-87, as amended; 42 U.S.C. § 1396 et seq.).

“Medical Reimbursement Programs” shall mean the Medicare, Medicaid and Tricare
programs and any other health care program operated by or financed in whole or
in part by any federal, state or local government.

“Medicare” shall mean that government-sponsored entitlement program under Title
XVIII of the Social Security Act that provides for a health insurance system for
eligible elderly and disabled individuals (Social Security Act of 1965, Title
XVIII, P.L. 89-87, as amended; 42 U.S.C. § 1395 et seq.).

“Minimum Extension Condition” shall have the meaning given to such term in
Section 2.25(b).

“Minority Investment” shall have the meaning given to such term in
Section 7.6(f).

“Moody’s” shall mean Moody’s Investors Service, Inc.

“Mortgaged Properties” shall mean each Real Property, if any, which shall be
subject to a Mortgage delivered after the Closing Date pursuant to
Section 6.12(c).

“Mortgages” shall mean each of the mortgages and deeds of trust made by any Loan
Party in favor of, or for the benefit of, the Collateral Agent for the benefit
of the Secured Parties, in a form reasonably satisfactory to the Collateral
Agent.

 

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“Multiemployer Plan” shall mean a multiemployer plan as defined in
Section 4001(a)(3) of ERISA to which any Group Member or ERISA Affiliate is
required to contribute or could otherwise have liability.

“Net Cash Proceeds” shall mean (a) in connection with any Asset Sale or any
Recovery Event, the proceeds thereof in the form of cash and Cash Equivalents
(including any such proceeds received by way of deferred payment of principal
pursuant to a note or installment receivable or purchase price adjustment
receivable or otherwise, but only as and when received) of such Asset Sale or
Recovery Event, net of attorneys’ fees, accountants’ fees, investment banking
fees, amounts required to be applied to the repayment of Debt secured by a Lien
expressly permitted hereunder on any asset that is the subject of such Asset
Sale or Recovery Event (other than any Lien pursuant to a Security Document) and
other customary fees and expenses actually incurred (or estimated by the
Borrower in good faith) in connection therewith, and net of (i) taxes paid or
reasonably estimated to be payable as a result thereof (after taking into
account any available tax credits or deductions and any tax sharing
arrangements), (ii) amounts reserved in accordance with GAAP against liabilities
relating to breaches of representations and warranties and indemnification
obligations, liabilities related to environmental matters or other liabilities
associated with the property and liabilities relating to assets subject to such
sale, lease, transfer or other disposition that are not assumed by the purchaser
in such Asset Sale and (iii) in the case of any Asset Sale by a Subsidiary, the
amount of any payments or distributions required to be made in respect of such
transaction to owners of Capital Stock in such Subsidiary other than the
Borrower or any other Subsidiary and (b) in connection with any issuance or sale
of Capital Stock or any incurrence of Debt, the cash proceeds received from such
issuance or incurrence, net of attorneys’ fees, investment banking fees,
accountants’ fees, underwriting discounts and commissions and other customary
fees and expenses actually incurred in connection therewith.

“Non-Excluded Taxes” shall have the meaning given to such term in
Section 2.19(a).

“Non-Guarantor Domestic Subsidiary” shall mean a Domestic Subsidiary of the
Borrower that is not a Guarantor.

“Non-Guarantor Subsidiary” shall mean a Subsidiary of the Borrower that is not a
Guarantor.

“Non-U.S. Lender” shall have the meaning given to such term in Section 2.19(e).

“Notes” shall mean, collectively, each promissory note in the form of
Exhibit N-1, N-2, N-3 or N-4, as applicable, evidencing Loans.

“NPL” shall mean the National Priorities List under CERCLA.

“Obligations” shall mean (a) obligations of the Borrower and the other Loan
Parties from time to time arising under or in respect of the due and punctual
payment of (i) the principal of and premium, if any, and interest (including
interest accruing during the pendency of any bankruptcy, insolvency,
receivership or other similar proceeding, regardless of whether allowed or
allowable in such proceeding) on the Loans, when and as due, whether at
maturity, by acceleration, upon one or more dates set for prepayment or
otherwise, (ii) each payment required to be made by the Borrower and the other
Loan Parties under this Agreement in respect of any Letter of Credit, when and
as due, including payments in respect of Reimbursement Obligations, interest
thereon and obligations to provide cash collateral and (iii) all other monetary
obligations, including fees, costs, expenses and indemnities, whether primary,
secondary, direct, contingent, fixed or otherwise (including monetary
obligations incurred during the pendency of any bankruptcy, insolvency,
receivership or other similar proceeding, regardless of whether allowed or

 

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allowable in such proceeding), of the Borrower and the other Loan Parties under
this Agreement and the other Loan Documents, and (b) the due and punctual
performance of all covenants, agreements, obligations and liabilities of the
Borrower and the other Loan Parties under or pursuant to this Agreement and the
other Loan Documents.

“OFAC” shall have the meaning given to such term in Section 4.23.

“OID” shall have the meaning given to such term in Section 2.24(c)(v).

“Other Taxes” shall mean any and all present or future stamp or documentary
taxes or any other excise or property taxes, charges or similar levies arising
from any payment made hereunder or under any other Loan Document or from the
execution, delivery or enforcement of, or otherwise with respect to, this
Agreement or any other Loan Document.

“Parent” shall mean with respect to any Lender, any Person as to which such
Lender is, directly or indirectly, a Subsidiary.

“Parent Entity” means, for purposes of the proviso to the definition of “Change
of Control”, a newly created entity having, at the time of consummation of a
reorganization transaction permitted by such proviso, no assets with a fair
market value in excess of $1.0 million (other than Capital Stock of the Borrower
and its Subsidiaries) and no liabilities with a fair market value in excess of
$1.0 million, in each case that would be reflected on an unconsolidated balance
sheet of such entity at such time.

“Participant” shall have the meaning given to such term in Section 11.6(c)(i).

“Participant Register” shall have the meaning given to such term in
Section 11.6(c)(iii).

“Participating Member State” shall mean each state so described in any EMU
Legislation.

“Patriot Act” shall have the meaning given to such term in Section 11.17.

“PBGC” shall mean the Pension Benefit Guaranty Corporation established pursuant
to Subtitle A of Title IV of ERISA (or any successor).

“Perfection Certificate” shall mean a certificate in the form of Exhibit K-1 or
any other form approved by the Collateral Agent, as the same shall be
supplemented from time to time by a Perfection Certificate Supplement or
otherwise.

“Perfection Certificate Supplement” shall mean a certificate supplement in the
form of Exhibit K-2 or any other form approved by the Collateral Agent.

“Permitted Liens” shall mean the following types of Liens (excluding any such
Lien imposed pursuant to Section 430(k) of the Code or by ERISA or any such Lien
relating to or imposed in connection with any Environmental Action): (a) Liens
for taxes, assessments and governmental charges or levies to the extent not
otherwise required to be paid under Section 6.3; (b) Liens imposed by law, such
as materialmen’s, mechanics’, carriers’, landlords’, workmen’s and repairmen’s
Liens and other similar Liens arising in the ordinary course of business
securing obligations (other than Debt for borrowed money) (i) that are not
overdue for a period of more than 60 days or (ii) the amount, applicability or
validity of which are being contested in good faith and with respect to which
the Borrower or any of its Subsidiaries, as the case may be, has established
reserves in accordance with GAAP; (c) pledges or deposits

 

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to secure obligations incurred in the ordinary course of business under workers’
compensation laws, unemployment insurance or similar social security legislation
(other than in respect of employee benefit plans subject to ERISA) or to secure
public or statutory obligations; (d) Liens, pledges and deposits securing the
performance of, or payment in respect of, bids, tenders, leases, contracts
(other than for the repayment of borrowed money), surety and appeal bonds,
letters of credit, and other obligations of a similar nature incurred in the
ordinary course of business; (e) any interest or title of a lessor or sublessor
and any restriction or encumbrance to which the interest or title of such lessor
or sublessor may be subject that is incurred in the ordinary course of business
and, either individually or when aggregated with all other Permitted Liens in
effect on any date of determination, could not be reasonably expected to have a
Material Adverse Effect; (f) Liens in favor of customs and revenue authorities
arising as a matter of law or pursuant to a bond to secure payment of customs
duties in connection with the importation of goods; (g) Liens arising out of
judgments or awards that do not constitute an Event of Default under
Section 8.1(i) and in respect of which the Borrower or any of its Subsidiaries
subject thereto shall be prosecuting an appeal or proceedings for review in good
faith and, pending such appeal or proceedings, shall have secured within 30 days
after the entry thereof a subsisting stay of execution and shall be maintaining
reserves, in accordance with GAAP, with respect to any such judgment or award;
(h) unperfected Liens of suppliers and vendors to secure the purchase price of
the property or assets sold; (i) protective UCC filings by lessors under
operating leases; (j) any easements, rights of way, restrictions, defects,
encroachments and other encumbrances on title to Real Property which either
individually or when aggregated with all other Permitted Liens, would not be
reasonably expected to have a Material Adverse Effect; and (k) bankers’ Liens,
rights of setoff and other similar Liens with respect to cash and Cash
Equivalents.

“Permitted Receivables Documents” shall mean all documents and agreements
evidencing, relating to or otherwise governing a Permitted Receivables
Financing.

“Permitted Receivables Financing” shall mean one or more transactions pursuant
to which (i) Receivables Assets or interests therein are sold to or financed by
one or more Special Purpose Receivables Subsidiaries, and (ii) such Special
Purpose Receivables Subsidiaries finance their acquisition of such Receivables
Assets or interests therein, or the financing thereof, by selling or borrowing
against such Receivables Assets; provided that (A) recourse to Borrower or any
Subsidiary (other than the Special Purpose Receivables Subsidiaries) and any
obligations or agreements of Borrower or any Subsidiary (other than the Special
Purpose Receivables Subsidiaries) in connection with such transactions shall be
limited to the extent customary for similar transactions in the applicable
jurisdictions (including, to the extent applicable, in a manner consistent with
the delivery of a “true sale”/”absolute transfer” opinion with respect to any
transfer by Borrower or any Subsidiary (other than a Special Purpose Receivables
Subsidiary), and (B) the sum of (x) the aggregate Receivables Transaction Amount
outstanding at any time pursuant to clause (a) of the definition of Receivables
Transaction Amount and (y) the aggregate Receivables Transaction Amount since
the Closing Date pursuant to clause (b) of the definition of “Receivables
Transaction Amount” shall not exceed $500,000,000.

“Permitted Refinancing” shall mean, with respect to any Debt, any modification,
refinancing, refunding, renewal or extension of such Debt; provided that (a) the
principal amount (or accreted value, if applicable) thereof does not exceed the
principal amount (or accreted value, if applicable) of the Debt so modified,
refinanced, refunded, renewed or extended except by an amount equal to unpaid
accrued interest and premium thereon plus other amounts paid, and fees and
expenses incurred, in connection with such modification, refinancing, refunding,
renewal or extension and by an amount equal to any existing commitments
unutilized thereunder; (b) the Debt resulting from such modification,
refinancing, refunding, renewal or extension has a Weighted Average Life to
Maturity equal to or greater than the Weighted Average Life to Maturity of the
Debt being modified, refinanced, refunded, renewed or extended; (c) immediately
after giving effect thereto, no Default shall have occurred and be continuing;

 

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(d) if the Debt being modified, refinanced, refunded, renewed or extended is
subordinated in right of payment to the Obligations, the Debt resulting from
such modification, refinancing, refunding, renewal or extension is subordinated
in right of payment to the Obligations on terms at least as favorable to the
Lenders as those contained in the documentation governing the Debt being
modified, refinanced, refunded, renewed or extended; and (e) no Person that is
not an obligor under the Debt being modified, refinanced, refunded, renewed or
extended shall be an obligor under such modification, refinancing, refunding,
renewal or extension.

“Person” shall mean an individual, partnership, corporation, limited liability
company, business trust, joint stock company, trust, unincorporated association,
joint venture, Governmental Authority or other entity of whatever nature.

“Plan” shall mean at a particular time, any employee benefit plan that is
covered by Title IV of ERISA or Section 412 of the Code and in respect of which
the Borrower or ERISA Affiliate is (or, if such plan were terminated at such
time, would under Section 4069 of ERISA be deemed to be) an “employer” as
defined in Section 3(5) of ERISA, other than any Multiemployer Plan.

“Platform” shall have the meaning given to such term in Section 11.2(d).

“Post-Increase Revolving Lenders” shall have the meaning given to such term in
Section 2.24(d).

“Pre-Increase Revolving Lenders” shall have the meaning given to such term in
Section 2.24(d).

“Premises” shall have the meaning assigned thereto in the applicable Mortgage.

“Prepayment Option Notice” shall have the meaning given to such term in
Section 2.11(e).

“Pricing Grid” shall mean the table set forth below.

For all Loans (other than Tranche B Term Loans) and the Commitment Fee Rate:

 

Leverage Ratio

   Applicable Margin for
Eurodollar Loans     Applicable Margin
for ABR Loans     Commitment
Fee Rate  

>3.0 to 1.0

     2.75 %      1.75 %      0.500 % 

£3.0 to 1.0 but ³2.5 to 1.0

     2.50 %      1.50 %      0.500 % 

<2.5 to 1.0

     2.25 %      1.25 %      0.375 % 

For the purposes of the Pricing Grid, changes in the Applicable Margin resulting
from changes in the Leverage Ratio shall become effective on the date (the
“Adjustment Date”) that is (x) in the case of calculation of the Leverage Ratio
as of the last day of the first three Fiscal Quarters of any Fiscal Year, one
Business Day after the date on which financial statements are delivered to the
Lenders pursuant to Section 6.1(c) and (y) in the case of calculation of the
Leverage Ratio as of the last day of any Fiscal Year, one Business Day after the
date on which the annual financial statements are delivered to Lenders setting
forth such financial information and accompanied by such certifications as are
required with respect to annual financial information pursuant to
Section 6.1(b). Such Applicable Margin shall remain in effect until the next
change to be effected pursuant to this paragraph. If any financial statements
referred to above are not delivered within the time periods specified in
Section 6.1, then, until the

 

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date that is one Business Day after the date on which such financial statements
are delivered, the highest rate set forth in each column of the Pricing Grid
shall apply. In addition, at all times while an Event of Default shall have
occurred and be continuing, the highest rate set forth in each column of the
Pricing Grid shall apply. Each determination of the Leverage Ratio pursuant to
the Pricing Grid shall be made in a manner consistent with the determination
thereof pursuant to Section 7.16(a).

“primary obligations” shall have the meaning given to such term in the
definition of “Contingent Obligation” set forth in this Section 1.1.

“primary obligor” shall have the meaning given to such term in the definition of
“Contingent Obligation” set forth in this Section 1.1.

“Prime Rate” shall have the meaning given to such term in the definition of
“ABR.”

“Pro Forma Basis” shall mean on a basis in accordance with GAAP and Regulation
S-X; provided that notwithstanding the provisions of Regulation S-X, pro forma
adjustments may include operating expense reductions for such period resulting
from the transaction which is being given pro forma effect which are identified
and factually supported in a certificate in which a Responsible Officer of the
Borrower certifies that such reductions are reasonably expected to be
sustainable and have been realized or the steps necessary for such realization
have been taken or are reasonably expected to be taken within twelve months
following any such transaction.

“Qualified Issuer” shall mean any commercial bank that has a combined capital
and surplus in excess of $500,000,000.

“Real Property” shall mean collectively, all right, title and interest
(including any leasehold, mineral or other estate) in and to any and all parcels
of or interests in real property owned, leased or operated by any Person,
whether by lease, license or other means, together with, in each case, all
easements, hereditaments and appurtenances relating thereto, all improvements
and appurtenant fixtures and equipment, all general intangibles and contract
rights and other property and rights incidental to the ownership, lease or
operation thereof.

“Receivables Assets” shall mean a right to receive payment arising from a sale
or lease of goods or the performance of services by the Borrower or any of its
Subsidiaries pursuant to an arrangement with another Person pursuant to which
such other Person is obligated to pay for goods or services under terms that
permit the purchase of such goods and services on credit and all proceeds
thereof and rights (contractual or otherwise) and collateral related thereto and
shall include, in any event, any items of property that would be classified as
an account receivable of the Borrower or any of its Subsidiaries or an
“account,” “chattel paper,” “payment intangible” or “instrument” under the
Uniform Commercial Code as in effect in the State of New York and any
“supporting obligations” or “proceeds” as so defined of any such items.

“Receivables Transaction Amount” shall mean (a) in the case of any Receivables
Assets securitization (but excluding any sale or factoring of Receivables
Assets), the amount of obligations outstanding under the legal documents entered
into as part of such Receivables Assets securitization on any date of
determination that would be characterized as principal if such Receivables
Assets securitization were structured as a secured lending transaction rather
than as a purchase and (b) in the case of any sale or factoring of Receivables
Assets, the cash purchase price paid by the buyer in connection with its
purchase of Receivables Assets (including any bills of exchange) less the amount
of collections received in respect of such Receivables Assets and paid to such
buyer, excluding any amounts applied to purchase fees or discount or in the
nature of interest, in each case as determined in good faith and in a consistent
and commercially reasonable manner by the Borrower.

 

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“Recovery Event” shall mean any settlement of or payment in respect of any
property or casualty insurance claim or any condemnation proceeding relating to
any asset of any Group Member.

“Redeemable Preferred Interest” shall mean with respect to any Person, (a) any
Capital Stock of such Person that, by its terms or by the terms of any security
into which it is convertible, exercisable or exchangeable, is, or upon the
happening of an event or the passage of time or both would be, required to be
redeemed or repurchased (including at the option of the holder thereof) by such
Person or any of its Subsidiaries, in whole or in part, earlier than six months
after the latest Maturity Date then in effect with respect to Tranche B Term
Loans; provided, however, that any Capital Stock that would constitute a
Redeemable Preferred Interest solely because the holders thereof have the right
to require the issuer to repurchase such a Redeemable Preferred Interest upon
the occurrence of a change of control shall not be so treated if the terms
thereof (a) do not trigger any rights upon any circumstance constituting a
change of control under such Redeemable Preferred Interest that would not
constitute a Change of Control under this Agreement and (b) do not permit either
any repurchase by such Person or any rights of the holder of such Capital Stock
to assert any claim in respect of such failure to purchase as long as any Event
of Default exists hereunder.

“Refinancing” shall mean (i) the repayment in full and the termination of any
commitment to make extensions of credit under the Existing Credit Agreement and
(ii)(A)(x) the consummation of the Tender Offer and (y) with respect to any
Existing Notes not tendered by holders thereof pursuant to the Tender Offer, the
Borrower having irrevocably called such Existing Notes for redemption and having
deposited the full payment price therefor pursuant to the terms of the
indentures governing the Existing Notes and (B) in the absence of the
consummation of the Tender Offer, the Borrower having irrevocably called all
Existing Notes for redemption and having deposited the full payment price
therefor pursuant to the terms of the indentures governing the Existing Notes.

“Refunded Swingline Loans” shall have the meaning given to such term in
Section 2.7(b).

“Register” shall have the meaning given to such term in Section 11.6(b)(iv).

“Reimbursement Obligation” shall mean the obligation of the Borrower to
reimburse the Issuing Lender pursuant to Section 3.5 for amounts drawn under
Letters of Credit.

“Reinvestment Deferred Amount” shall mean with respect to any Reinvestment
Event, the aggregate Net Cash Proceeds received by any Group Member in
connection therewith that are not applied to prepay the Term Loans the Revolving
Loans pursuant to Section 2.11(b) as a result of the delivery of a Reinvestment
Notice.

“Reinvestment Event” shall mean any Asset Sale or Recovery Event in respect of
which the Borrower has delivered a Reinvestment Notice.

“Reinvestment Notice” shall mean a written notice executed by a Responsible
Officer stating that no Event of Default has occurred and is continuing and that
the Borrower (directly or indirectly through a Subsidiary) intends and expects
to use all or a specified portion of the Net Cash Proceeds of an Asset Sale or
Recovery Event to acquire or repair assets useful in its business.

 

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“Reinvestment Prepayment Amount” shall mean with respect to any Reinvestment
Event, the Reinvestment Deferred Amount relating thereto less any amount
expended prior to the relevant Reinvestment Prepayment Date to acquire or repair
assets useful in the Borrower’s business.

“Reinvestment Prepayment Date” shall mean with respect to any Reinvestment
Event, the earliest of (a) the date occurring on the second anniversary of such
Reinvestment Event, (b) if the Borrower shall not have entered into a binding
commitment to reinvest the Net Cash Proceeds received in connection with such
Reinvestment Event, the date occurring 540 days after such Reinvestment Event
and (c) the date on which the Borrower shall have determined not to acquire or
repair assets useful in the Borrower’s business with all or any portion of the
relevant Reinvestment Deferred Amount.

“Related Parties” shall mean with respect to any specified Person, such Person’s
Affiliates and the respective directors, officers, employees, agents and
advisors of such Person and such Person’s Affiliates.

“Release” shall mean any release, spill, emission, discharge, deposit, disposal,
leaking, pumping, pouring, dumping, emptying, injecting or leaching into the
Environment, or into, from or through any structure or facility.

“Required Financial Information” shall mean at any date of determination, the
Consolidated financial statements of the Borrower and its Subsidiaries most
recently delivered to the Administrative Agent and the Lenders on or prior to
such date pursuant to, and satisfying all of the requirements of, Section 6.1(b)
or 6.1(c) and accompanied by the certificates and other information required to
be delivered therewith.

“Required Lenders” shall mean at any time, the holders of more than 50% of the
sum of (i) the aggregate unpaid principal amount of the Term Loans then
outstanding and (ii) the Total Revolving Commitments then in effect or, if the
Revolving Commitments have been terminated, the Total Revolving Extensions of
Credit then outstanding.

“Requirement of Law” shall mean as to any Person, the Constitutive Documents of
such Person, and any law, treaty, rule or regulation or determination of an
arbitrator or a court or other Governmental Authority, in each case applicable
to or binding upon such Person or any of its property or to which such Person or
any of its property is subject.

“Responsible Officer” shall mean, with respect to the Borrower or any of its
Subsidiaries, the chief executive officer, the president, the chief financial
officer, the principal accounting officer or the treasurer (or the equivalent of
any of the foregoing) or any other officer, partner or member (or Person
performing similar functions) of the Borrower or any such Subsidiary responsible
for overseeing the administration of, or reviewing compliance with, all or any
portion of this Agreement or any of the other Loan Documents.

“Revaluation Date” shall mean with respect to Alternative Currency Revolving
Loans, each of the following: (i) each Borrowing Date of a Eurodollar Loan
denominated in an Alternative Currency, (ii) each date of a continuation of a
Eurodollar Loan denominated in an Alternative Currency pursuant to
Section 2.12(b), (iii) the date of any partial reduction of the Alternative
Currency Revolving Commitments pursuant to Section 2.11(f)(ii) and (iv) after a
Default has occurred and is continuing, such additional dates as the
Administrative Agent shall determine or the Required Lenders shall require.

 

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“Revolving Commitment” shall mean, as to any Revolving Lender, collectively, the
Dollar Revolving Commitment and the Alternative Currency Revolving Commitment of
such Revolving Lender.

“Revolving Commitment Period” shall mean the period from and including the
Closing Date to but excluding the Business Day preceding the latest Maturity
Date applicable to the Revolving Facility.

“Revolving Extensions of Credit” shall mean, collectively, the Dollar Revolving
Extensions of Credit and the Alternative Currency Revolving Extensions of
Credit.

“Revolving Facility” shall mean, collectively, the Dollar Revolving Facility and
the Alternative Currency Revolving Facility.

“Revolving Lenders” shall mean, collectively, the Dollar Revolving Lenders and
Alternative Currency Revolving Lenders.

“Revolving Loans” shall mean, collectively, the Dollar Revolving Loans and
Alternative Currency Revolving Loans.

“Revolving Percentage” shall mean, as to any Revolving Lender, collectively, the
Dollar Revolving Percentage and the Alternative Currency Revolving Percentage of
such Revolving Lender.

“Revolving Termination Date” shall mean October 20, 2015.

“S&P” shall mean Standard & Poor’s Ratings Group, a division of The McGraw-Hill
Companies, Inc.

“Sale and Leaseback Transaction” with respect to any Person shall mean an
arrangement to sell or transfer any property, real or personal, used or useful
in such Person’s business, whether now owned or hereafter acquired, and
thereafter rent or lease such property or other property which it intends to use
for substantially the same purpose or purposes as the property being sold or
transferred.

“SEC” shall mean the Securities and Exchange Commission, any successor thereto
and any analogous Governmental Authority.

“Secured Cash Management Agreement” shall mean any Cash Management Agreement
that is entered into by and between any Loan Party and any Cash Management Bank;
provided that the aggregate amount of Debt under all Secured Cash Management
Agreements shall not exceed $25,000,000 at any time outstanding.

“Secured Obligations” shall mean (a) the Obligations and (b) the due and
punctual payment and performance of all obligations of the Borrower and the
other Loan Parties under each Specified Swap Agreement and each Secured Cash
Management Agreement, in each case, whether direct or indirect (including those
acquired by assumption), absolute or contingent, due or to become due, now
existing or hereafter arising and including interest and fees that accrue after
the commencement by or against any Loan Party or any Affiliate thereof of any
proceeding under any bankruptcy, insolvency, receivership or other similar
proceeding naming such Person as the debtor in such proceeding, regardless of
whether such interest and fees are allowed claims in such proceeding.

 

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“Secured Parties” shall mean collectively, the Administrative Agent, the
Collateral Agent, each other Agent, the Lenders, each Cash Management Bank and
each party to a Specified Swap Agreement (other than any Group Member) if, in
the case of any Person not already a party to this Agreement, such Person
executes and delivers to the Administrative Agent a letter agreement in form and
substance acceptable to the Administrative Agent pursuant to which such Person
(i) appoints the Collateral Agent as its agent under the applicable Loan
Documents and (ii) agrees to be bound by the provisions of Sections 11.5, 11.11
and 11.12 as if it were a Lender and as if the fair market value of its Secured
Obligations constituted Loans hereunder.

“Securities Collateral” shall have the meaning assigned to such term in the
Security Agreement.

“Security Agreement” shall mean the Security Agreement to be executed and
delivered by the Borrower and each Guarantor, substantially in the form of
Exhibit A.

“Security Agreement Collateral” shall mean all property pledged or granted as
collateral pursuant to the Security Agreement (a) on the Closing Date or
(b) thereafter pursuant to Section 6.12.

“Security Documents” shall mean, collectively, the Security Agreement, the
Mortgages (if any) and all other security documents hereafter delivered to the
Collateral Agent granting a Lien on any property of any Person to secure the
obligations and liabilities of any Loan Party under any Loan Document.

“Senior Notes” shall have the meaning given to such term in the recitals hereto.

“Senior Notes Documents” shall mean the Senior Notes, the Senior Notes
Indenture, the Senior Notes Guarantees and all other documents executed and
delivered with respect to the Senior Notes or the Senior Notes Indenture.

“Senior Notes Guarantees” shall mean the guarantees of the Guarantors of each
series of Senior Notes pursuant to the Senior Notes Indenture.

“Senior Notes Indenture” shall mean the indenture dated as of the Closing Date
by and among the Borrower, the Guarantors named therein and The Bank of New York
Mellon Trust Company, N.A., as trustee, pursuant to which each series of the
Senior Notes was issued.

“Solvent” shall mean when used with respect to any Person, that, as of any date
of determination, (a) the amount of the “present fair saleable value” of the
assets of such Person will, as of such date, exceed the amount of all
“liabilities of such Person, contingent or otherwise,” as of such date, as such
quoted terms are determined in accordance with applicable federal and state laws
governing determinations of the insolvency of debtors, (b) the present fair
saleable value of the assets of such Person will, as of such date, be greater
than the amount that will be required to pay the liability of such Person on its
debts as such debts become absolute and matured, (c) such Person will not have,
as of such date, an unreasonably small amount of capital with which to conduct
its business, and (d) such Person will be able to pay its debts as they mature.
For purposes of this definition, (i) “debt” shall mean liability on a “claim,”
and (ii) “claim” shall mean any (x) right to payment, whether or not such a
right is reduced to judgment, liquidated, unliquidated, fixed, contingent,
matured, unmatured, disputed, undisputed, legal, equitable, secured or unsecured
or (y) right to an equitable remedy for breach of performance if such breach
gives rise to a right to payment, whether or not such right to an equitable
remedy is reduced to judgment, fixed, contingent, matured or unmatured,
disputed, undisputed, secured or unsecured.

 

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“Special Purpose Licensed Entity” shall mean any Person in a related business of
the Borrower and its Subsidiaries that (i) the Borrower and its Subsidiaries are
prohibited from engaging in directly under applicable law, including provisions
of state law (a) prohibiting the ownership of healthcare facilities by public
companies, (b) prohibiting the corporate practice of medicine or (c) otherwise
restricting the ability of the Borrower or one of its Subsidiaries to acquire
directly a required license to operate a healthcare facility, and (ii) has
entered into a transaction or series of transactions with the Borrower or any of
its Subsidiaries under which:

(x) the Borrower or any of its Subsidiaries provides management, administrative
or consulting services to the Special Purpose Licensed Entity,

(y) the owners of the Special Purpose Licensed Entity are prohibited from
transferring any of their interests in the Special Purpose Licensed Entity
without the consent of the Borrower or one of its Subsidiaries, and

(z) the Borrower or one of its Subsidiaries has the right to require the owners
of the Special Purpose Licensed Entity to transfer all of their interests in the
Special Purpose Licensed Entity to a Person designated by the Borrower or one of
its Subsidiaries.

“Special Purpose Receivables Subsidiary” shall mean a direct or indirect
Subsidiary of the Borrower established in connection with a Permitted
Receivables Financing for the acquisition of Receivables Assets or interests
therein, and which is organized in a manner intended to reduce the likelihood
that it would be substantively consolidated with the Borrower or any of the
Subsidiaries (other than Special Purpose Receivables Subsidiaries) in the event
the Borrower or any such Subsidiary becomes subject to a proceeding under the
U.S. Bankruptcy Code (or other insolvency law).

“Specified Change of Control” shall mean a “Change of Control” (or any other
defined term having a similar purpose) as defined in the Senior Notes Indenture.

“Specified Debt” shall mean Debt issued or incurred by the Borrower; provided
that (i) the terms (other than pricing, but including without limitation
negative covenants) in such Debt are not materially more burdensome to the
Borrower taken as a whole than the terms of the Senior Notes Indenture,
(ii) such Debt shall not be guaranteed by any Subsidiaries that are not
Guarantors hereunder and (iii) such Debt does not provide for any scheduled
payment or mandatory prepayment of principal earlier than six months after the
latest Maturity Date in effect with respect to the Tranche B Term Facility on
the date such Debt is issued or incurred, other than (x) redemptions made at the
option of the holders of such Debt upon a change in control of the Borrower in
circumstances that would also constitute a Change of Control under this
Agreement (provided that any such redemption cannot be made fewer than 30 days
after such change in control) and (y) mandatory prepayments required as a result
of asset dispositions if such Debt allows the Borrower to satisfy such mandatory
prepayment requirement by prepayment of Loans under this Agreement or other
senior obligations of the Borrower or reinvestment of the asset disposition
proceeds within a specified period of time.

“Specified Swap Agreement” shall mean any Swap Agreement entered into by the
Borrower and any Lender (at the time of the execution of such Swap Agreement) or
affiliate thereof in respect of interest rates or currency exchange rates.

“Spot Rate” for a currency shall mean the rate determined by the Administrative
Agent to be the rate quoted by the Person acting in such capacity as the spot
rate for the purchase by such Person of such currency with another currency
through its principal foreign exchange trading office at approximately 11:00
a.m. on the date two Business Days prior to the date as of which the foreign
exchange computation

 

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is made; provided that the Administrative Agent may obtain such spot rate from
another financial institution designated by the Administrative Agent if the
Person acting in such capacity does not have as of the date of determination a
spot buying rate for any such currency.

“Sterling” and “£” shall mean the lawful currency of the United Kingdom.

“Stock Repurchase” shall mean the repurchase by the Borrower of its common stock
from its existing shareholders for an aggregate purchase price not to exceed
$1,200,000,000.

“Subsidiary” shall mean with respect to any Person (the “parent”) at any date,
any corporation, limited liability company, partnership, association or other
business entity the accounts of which would be consolidated with those of the
parent in the parent’s Consolidated financial statements as well as any
corporation, limited liability company, partnership, association or other
business entity (i) of which securities or other ownership interests
representing more than 50% of the voting power of all Capital Stock entitled
(without regard to the occurrence of any contingency) to vote in the election of
the Board of Directors thereof are, as of such date, owned, Controlled or held
by the parent and/or one or more subsidiaries of the parent or (ii) that is, as
of such date, otherwise Controlled by the parent and/or one or more subsidiaries
of the parent; provided, however, that entities shall not be deemed Subsidiaries
so long as the assets of each such entity do not exceed $25,000 (unless the
Borrower shall elect to include such entity as a Guarantor). Unless the context
requires otherwise, “Subsidiary” refers to a Subsidiary of the Borrower.

“Survey” shall mean a survey of any Mortgaged Property (and all improvements
thereon) which is (a) (i) prepared by a surveyor or engineer licensed to perform
surveys in the jurisdiction where such Mortgaged Property is located, (ii) dated
(or redated) not earlier than six months prior to the date of delivery thereof
unless there shall have occurred within six months prior to such date of
delivery any exterior construction on the site of such Mortgaged Property or any
easement, right of way or other interest in the Mortgaged Property has been
granted or become effective through operation of law or otherwise with respect
to such Mortgaged Property which, in either case, can be depicted on a survey,
in which events, as applicable, such survey shall be dated (or redated) after
the completion of such construction or if such construction shall not have been
completed as of such date of delivery, not earlier than 20 days prior to such
date of delivery, or after the grant or effectiveness of any such easement,
right of way or other interest in the Mortgaged Property, (iii) certified by the
surveyor (in a manner reasonably acceptable to the Administrative Agent) to the
Administrative Agent, the Collateral Agent and the Title Company, (iv) complying
in all respects with the minimum detail requirements of the American Land Title
Association as such requirements are in effect on the date of preparation of
such survey and (v) sufficient for the Title Company to remove all standard
survey exceptions from the title insurance policy (or commitment) relating to
such Mortgaged Property and issue the endorsements of a type reasonably
requested by the Collateral Agent or (b) otherwise acceptable to the Collateral
Agent.

“Swap Agreement” shall mean any agreement with respect to any swap, forward,
future or derivative transaction or option or similar agreement involving, or
settled by reference to, one or more rates, currencies, commodities, equity or
debt instruments or securities, or economic, financial or pricing indices or
measures of economic, financial or pricing risk or value or any similar
transaction or any combination of these transactions; provided that no phantom
stock or similar plan providing for payments only on account of services
provided by current or former directors, officers, employees or consultants of
the Borrower or any of its Subsidiaries shall be a “Swap Agreement.”

“Swingline Commitment” shall mean the obligation of the Swingline Lender to make
Swingline Loans pursuant to Section 2.6 in an aggregate principal amount at any
one time outstanding not to exceed $50,000,000.

 

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“Swingline Lender” shall mean JPMorgan Chase Bank, N.A., in its capacity as the
lender of Swingline Loans; provided that, if any Extension or Extensions of
Alternative Currency Revolving Commitments is or are effected in accordance with
Section 2.25, then on the occurrence of each Issuing Lender/Swingline
Termination Date, the Swingline Lender at such time shall have the right to
resign as Swingline Lender on, or on any date within twenty (20) Business Days
after, the respective Issuing Lender/Swingline Termination Date, in each case
upon not less than ten (10) days’ prior written notice thereof to the Borrower
and the Administrative Agent and, in the event of any such resignation and upon
the effectiveness thereof, the Borrower shall repay any outstanding Swingline
Loans made by the respective entity so resigning and such entity shall not be
required to make any further Swingline Loans hereunder. If at any time and for
any reason (including as a result of resignations as contemplated by the proviso
to the preceding sentence), the Swingline Lender has resigned in such capacity
in accordance with the preceding sentence, then no Person shall be the Swingline
Lender hereunder or obligated to make Swingline Loans unless and until (and only
for so long as) a Lender (or affiliate of a Lender) reasonably satisfactory to
the Administrative Agent and the Borrower agrees to act as the Swingline Lender
hereunder.

“Swingline Loans” shall have the meaning given to such term in Section 2.6.

“Swingline Participation Amount” shall have the meaning given to such term in
Section 2.7(c).

“Syndication Agent” shall have the meaning given to such term in the preamble
hereto.

“TARGET Day” shall mean any day on which the Trans-European Automated Real-time
Gross Settlement Express Transfer (TARGET) payment system (or, if such payment
system ceases to be operative, such other payment system (if any) determined by
the Administrative Agent to be a suitable replacement) is open for the
settlement of payments in Euro.

“Taxes” shall mean (i) all present or future income, stamp or other taxes,
levies, imposts, duties, deductions, withholdings, assessments, fees or other
charges imposed by any Governmental Authority, including any interest, additions
to tax or penalties applicable thereto, and (ii) all transferee, successor,
joint and several, contractual or other liability (including, without
limitation, liability pursuant to Treas. Reg. §1.1502-6 (or any similar state,
local or foreign provision)) in respect of any items described in clause (i).

“Tender Offer” shall have the meaning given to such term in the recitals hereto.

“Term Lenders” shall mean, collectively, the Tranche A Term Lenders and the
Tranche B Term Lenders.

“Term Loans” shall mean, collectively, the Tranche A Term Loans and Tranche B
Term Loans.

“Title Company” shall mean any title insurance company as shall be retained by
the Borrower and reasonably acceptable to the Administrative Agent.

“Total Alternative Currency Revolving Commitments” shall mean at any time, the
aggregate amount of the Alternative Currency Revolving Commitments then in
effect. The original amount of the Total Alternative Currency Revolving
Commitments is the Alternative Currency Equivalent of $150,000,000.

 

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“Total Alternative Currency Revolving Extensions of Credit” shall mean, at any
time, the aggregate amount of the Alternative Currency Revolving Extensions of
Credit of the Alternative Currency Revolving Lenders outstanding at such time.

“Total Dollar Revolving Commitments” shall mean at any time, the aggregate
amount of the Dollar Revolving Commitments then in effect. The original amount
of the Total Dollar Revolving Commitments is $100,000,000.

“Total Dollar Revolving Extensions of Credit” shall mean, at any time, the
aggregate amount of the Dollar Revolving Extensions of Credit of the Dollar
Revolving Lenders outstanding at such time.

“Total Facility Amount” shall mean the sum of (i) the outstanding Revolving
Commitments, (ii) the aggregate principal amount of all outstanding Term Loans
and (iii) the aggregate principal amount of all outstanding Incremental Term
Loans, in each case, giving effect to any proposed increase in Revolving
Commitments or incurrence of Incremental Term Loans pursuant to Section 2.24.

“Total Revolving Commitments” shall mean at any time, the aggregate amount of
the Revolving Commitments then in effect.

“Total Revolving Extensions of Credit” shall mean at any time, the aggregate
amount of the Revolving Extensions of Credit of the Revolving Lenders
outstanding at such time.

“tranche” shall have the meaning given to such term in Section 2.25(a).

“Tranche A Term Commitment” shall mean as to any Lender, the obligation of such
Lender, if any, to make a Tranche A Term Loan to the Borrower in a principal
amount not to exceed the amount set forth under the heading “Tranche A Term
Commitment” on such Lender’s Addendum. The original aggregate amount of the
Tranche A Term Commitments is $1,000,000,000.

“Tranche A Term Facility” shall have the meaning given to such term in the
definition of “Facility.”

“Tranche A Term Lender” shall mean each Lender that has a Tranche A Term
Commitment or that holds a Tranche A Term Loan.

“Tranche A Term Loan” shall have the meaning given to such term in Section 2.1.

“Tranche A Term Loan Maturity Date” shall mean October 20, 2015.

“Tranche A Term Percentage” shall mean as to any Tranche A Term Lender at any
time, the percentage which such Lender’s Tranche A Term Commitment then
constitutes of the aggregate Tranche A Term Commitments (or, at any time after
the Closing Date, the percentage which the aggregate principal amount of such
Lender’s Tranche A Term Loans then outstanding constitutes of the aggregate
principal amount of the Tranche A Term Loans then outstanding).

“Tranche B Prepayment Amount” shall have the meaning given to such term in
Section 2.11(e).

“Tranche B Term Commitment” shall mean as to any Lender, the obligation of such
Lender, if any, to make a Tranche B Term Loan to the Borrower in a principal
amount not to exceed the

 

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amount set forth under the heading “Tranche B Term Commitment” in such Lender’s
Addendum or in an Increase Joinder. The original aggregate amount of the Tranche
B Term Commitments is $1,750,000,000.

“Tranche B Term Facility” shall have the meaning given to such term in the
definition of “Facility.”

“Tranche B Term Lender” shall mean each Lender that has a Tranche B Term
Commitment or that holds a Tranche B Term Loan.

“Tranche B Term Loan” shall have the meaning given to such term in Section 2.1.

“Tranche B Term Loan Maturity Date” shall mean October 20, 2016.

“Tranche B Term Percentage” shall mean as to any Tranche B Term Lender at any
time, the percentage which such Lender’s Tranche B Term Commitment then
constitutes of the aggregate Tranche B Term Commitments (or, at any time after
the Closing Date, the percentage which the aggregate principal amount of such
Lender’s Tranche B Term Loans then outstanding constitutes of the aggregate
principal amount of the Tranche B Term Loans then outstanding).

“Transaction Documents” shall mean the Senior Notes Documents and the Loan
Documents.

“Transactions” shall mean collectively, (a) the execution, delivery and
performance of the Loan Documents and the initial borrowings hereunder; (b) the
Refinancing; (c) the issuance of the Senior Notes; (d) the Stock Repurchase and
(e) the payment of all fees and expenses owing in connection with the foregoing.

“Transferee” shall mean any Assignee or Participant.

“Transferred Guarantor” shall have the meaning given to such term in
Section 10.9.

“Tricare” shall mean the managed health care program that is established by the
Department of Defense under Title 10, Subtitle A, Part II, Chapter 55 (10 U.S.C.
§1071 et seq.) for members of the military, military retirees, and their
dependents, and includes the competitive selection of contractors to financially
underwrite the delivery of health care services under the Civilian Health and
Medical Program of the Uniformed Services.

“Type” shall mean as to any Loan, its nature as an ABR Loan or a Eurodollar
Loan.

“UCC” shall mean the Uniform Commercial Code as in effect from time to time
(except as otherwise specified) in any applicable state or jurisdiction.

“United States” shall mean the United States of America.

“Voting Interests” shall mean shares of Capital Stock issued by a corporation,
or equivalent Capital Stock of any other Person, the holders of which are
ordinarily, in the absence of contingencies, entitled to vote for the election
of directors (or persons performing similar functions) of such Person, even if
the right so to vote has been suspended by the happening of such a contingency.

 

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“Weighted Average Life to Maturity” shall mean, when applied to any Debt 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
Debt.

“Wholly Owned Subsidiary” shall mean as to any Person, any other Person all of
the Capital Stock of which (other than directors’ qualifying shares required by
law) is owned by such Person directly and/or through other Wholly Owned
Subsidiaries.

“Withdrawal Liability” shall have the meaning specified in Part I of Subtitle E
of Title IV of ERISA.

1.2 Classification of Loans. For purposes of this Agreement, Loans may be
classified and referred to by Facility (e.g., a “Revolving Loan”) or by Type
(e.g., a “Eurodollar Loan”) or by Facility and Type (e.g., a “Eurodollar
Revolving Loan”).

1.3 Terms Generally. The definitions of terms herein shall apply equally to the
singular and plural forms of the terms defined. Whenever the context may
require, any pronoun shall include the corresponding masculine, feminine and
neuter forms. The words “include,” “includes” and “including” shall be deemed to
be followed by the phrase “without limitation.” The word “will” shall be
construed to have the same meaning and effect as the word “shall.” Unless the
context requires otherwise (a) any definition of or reference to any Loan
Document, agreement, instrument or other document herein shall be construed as
referring to such agreement, instrument or other document as from time to time
amended, supplemented or otherwise modified (subject to any restrictions on such
amendments, supplements or modifications set forth herein), (b) any reference
herein to any Person shall be construed to include such Person’s successors and
assigns, (c) the words “herein,” “hereof” and “hereunder,” and words of similar
import, shall be construed to refer to this Agreement in its entirety and not to
any particular provision hereof, (d) all references herein to Sections, Exhibits
and Schedules shall be construed to refer to Sections of, and Exhibits and
Schedules to, this Agreement, unless otherwise indicated, (e) any reference to
any law or regulation herein shall refer to such law or regulation as amended,
modified or supplemented from time to time, (f) the words “asset” and “property”
shall be construed to have the same meaning and effect and to refer to any and
all tangible and intangible assets and properties, including cash, securities,
accounts and contract rights and (g) “on,” when used with respect to the
Mortgaged Property or any property adjacent to the Mortgaged Property, shall
mean “on, in, under, above or about.”

1.4 Accounting Terms; GAAP. Except as otherwise expressly provided herein, all
terms of an accounting or financial nature shall be construed in accordance with
GAAP, as in effect from time to time; provided that, if the Borrower notifies
the Administrative Agent that the Borrower requests an amendment to any
provision hereof to eliminate the effect of any change in GAAP occurring after
the Closing Date or in the application thereof on such provision (or if the
Administrative Agent notifies the Borrower that the Required Lenders request an
amendment to any provision hereof for such purpose), regardless of whether any
such notice is given before or after such change in GAAP or in the application
thereof, then such provision shall be interpreted on the basis of GAAP as in
effect and applied immediately before such change shall have become effective
until such notice shall have been withdrawn or such provision amended in
accordance herewith; provided that the Borrower shall provide to the
Administrative Agent and the Lenders a written reconciliation, between
calculations of the affected item in amounts required to be reported under
Sections 6.1(b) and (c) (including in any Compliance Certificate) before and
after giving effect to such change in GAAP.

 

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For the avoidance of doubt, Persons that are not Subsidiaries shall not be
included in any calculation relevant to Section 7.16.

1.5 Resolution of Drafting Ambiguities. Each Loan Party acknowledges and agrees
that it was represented by counsel in connection with the execution and delivery
of the Loan Documents to which it is a party, that it and its counsel reviewed
and participated in the preparation and negotiation hereof and thereof and that
any rule of construction to the effect that ambiguities are to be resolved
against the drafting party shall not be employed in the interpretation hereof or
thereof.

1.6 Exchange Rates; Currency Equivalents.

(a) The Administrative Agent shall determine the Spot Rates as of each
Revaluation Date to be used for calculating Dollar Equivalent amounts of
Alternative Currency Revolving Loans outstanding. Such Spot Rates shall become
effective as of such Revaluation Date and shall be the Spot Rates employed in
converting any amounts between the applicable currencies until the next
Revaluation Date to occur. Except for purposes of financial statements delivered
by Loan Parties hereunder or calculating financial covenants hereunder or except
as otherwise provided herein, the applicable amount of any currency (other than
Dollars) for purposes of the Loan Documents shall be such Dollar Equivalent
amount as so determined by the Administrative Agent.

(b) Wherever in this Agreement in connection with an Alternative Currency
Revolving Loan, a conversion, continuation or prepayment of an Alternative
Currency Revolving Loan, an amount, such as a required minimum or multiple
amount, is expressed in Dollars, but such Alternative Currency Revolving Loan is
denominated in an Alternative Currency, such amount shall be the relevant
Alternative Currency Equivalent of such Dollar amount (rounded to the nearest
unit of such Alternative Currency, with 0.5 of a unit being rounded upward), as
determined by the Administrative Agent.

1.7 Additional Alternative Currencies.

(a) The Borrower may from time to time request that Alternative Currency
Revolving Loans be made in a currency other than those specifically listed in
the definition of “Alternative Currency”; provided that such requested currency
is a lawful currency (other than Dollars) that is readily available and freely
transferable and convertible into Dollars. In the case of any such request with
respect to the making of Alternative Currency Revolving Loans, such request
shall be subject to the approval of the Administrative Agent and the Alternative
Currency Revolving Lenders.

(b) Any such request shall be made to the Administrative Agent not later than
11:00 a.m., Local Time, 20 Business Days prior to the date of the desired
extension of credit. The Administrative Agent shall promptly notify each
Alternative Currency Revolving Lender of any request pursuant to this
Section 1.7. Each Alternative Currency Revolving Lender shall notify the
Administrative Agent, not later than 11:00 a.m., Local Time, ten Business Days
after receipt of such request whether it consents, in its sole discretion, to
the making of Alternative Currency Revolving Loans denominated in such currency.

(c) Any failure by an Alternative Currency Revolving Lender to respond to such
request within the time period specified in the preceding sentence shall be
deemed to be a refusal by such Alternative Currency Revolving Lender to permit
Alternative Currency Revolving Loans to be made in such requested currency. If
the Administrative Agent and all the Alternative Currency Revolving Lenders
consent to making Alternative Currency Revolving Loans in such requested
currency, the Administrative Agent shall so notify the Borrower and such
currency shall thereupon be deemed for all purposes to be an Alternative
Currency hereunder for purposes of any Alternative Currency Revolving Loans. If
the Administrative Agent shall fail to obtain consent to any request for an
additional currency under this Section 1.7, the Administrative Agent shall
promptly so notify the Borrower.

 

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1.8 Change of Currency.

(a) Each obligation of the Borrower to make a payment denominated in the
national currency unit of any member state of the European Union that adopts the
Euro as its lawful currency after the date hereof shall be redenominated into
Euro at the time of such adoption (in accordance with the EMU Legislation). If,
in relation to the currency of any such member state, the basis of accrual of
interest expressed in this Agreement in respect of that currency shall be
inconsistent with any convention or practice in the London interbank market for
the basis of accrual of interest in respect of the Euro, such expressed basis
shall be replaced by such convention or practice with effect from the date on
which such member state adopts the Euro as its lawful currency; provided that if
any Alternative Currency Revolving Loans in the currency of such member state is
outstanding immediately prior to such date, such replacement shall take effect,
with respect to such Alternative Currency Revolving Loans, at the end of the
then current Interest Period.

(b) Each provision of this Agreement shall be subject to such reasonable changes
of construction as the Administrative Agent may from time to time specify to be
appropriate to reflect the adoption of the Euro by any member state of the
European Union and any relevant market conventions or practices relating to the
Euro.

(c) Each provision of this Agreement also shall be subject to such reasonable
changes of construction as the Administrative Agent may from time to time
specify to be appropriate to reflect a change in currency of any other country
and any relevant market conventions or practices relating to the change in
currency.

SECTION 2

AMOUNT AND TERMS OF COMMITMENTS

2.1 Term Commitments. Subject to the terms and conditions hereof, (a) each
Tranche A Term Lender severally agrees to make a term loan denominated in
Dollars (a “Tranche A Term Loan”) to the Borrower on the Closing Date in an
amount not to exceed the amount of the Tranche A Term Commitment of such Lender
and (b) each Tranche B Term Lender severally agrees to make a term loan
denominated in Dollars (a “Tranche B Term Loan”) to the Borrower on the Closing
Date in an amount not to exceed the amount of the Tranche B Term Commitment of
such Lender. The Term Loans may from time to time be Eurodollar Loans or ABR
Loans, as determined by the Borrower and notified to the Administrative Agent in
accordance with Sections 2.2 and 2.12.

2.2 Procedure for Term Loan Borrowing. The Borrower shall give the
Administrative Agent irrevocable notice in the form of a Borrowing Request
(which notice must be received by the Administrative Agent prior to 1:00 P.M.,
New York City time, (a) three Business Days prior to the anticipated Closing
Date, in the case of Eurodollar Loans, or (b) one Business Day prior to the
anticipated Closing Date, in the case of ABR Loans) requesting that the Term
Lenders make the Term Loans on the Closing Date and specifying the amount to be
borrowed under each tranche. Upon receipt of such notice the Administrative
Agent shall promptly notify each Term Lender thereof. Not later than 12:00 Noon,
New York City time, on the Closing Date each Term Lender shall make available to
the Administrative Agent at the Funding Office an amount in immediately
available funds equal to the Term Loan to be made by such Term Lender. The
Administrative Agent shall credit the account of the Borrower on the books of
such office of the Administrative Agent with the aggregate of the amounts made
available to the Administrative Agent by the Term Lenders in immediately
available funds.

 

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2.3 Repayment of Term Loans.

(a) The Tranche A Term Loan of each Tranche A Term Lender shall mature in 20
consecutive quarterly installments and on the Tranche A Term Loan Maturity Date,
in an amount equal to such Lender’s Tranche A Term Percentage multiplied by the
amount set forth below opposite such installment:

 

Installment Due Date

   Principal Amount  

March 31, 2011

   $ 12,500,000   

June 30, 2011

   $ 12,500,000   

September 30, 2011

   $ 12,500,000   

December 31, 2011

   $ 12,500,000   

March 31, 2012

   $ 12,500,000   

June 30, 2012

   $ 12,500,000   

September 30, 2012

   $ 12,500,000   

December 31, 2012

   $ 12,500,000   

March 31, 2013

   $ 25,000,000   

June 30, 2013

   $ 25,000,000   

September 30, 2013

   $ 25,000,000   

December 31, 2013

   $ 25,000,000   

March 31, 2014

   $ 37,500,000   

June 30, 2014

   $ 37,500,000   

September 30, 2014

   $ 37,500,000   

December 31, 2014

   $ 37,500,000   

March 31, 2015

   $ 37,500,000   

June 30, 2015

   $ 37,500,000   

September 30, 2015

   $ 37,500,000   

Tranche A Term Loan Maturity Date

   $ 537,500,000   

(b) The Tranche B Term Loan of each Tranche B Term Lender shall mature (i) in 23
consecutive quarterly installments on the last day of each September, December,
March and June (commencing on March 31, 2011), each in an amount equal to such
Lender’s Tranche B Term Percentage multiplied by 0.25% of the aggregate
principal amount of the Tranche B Term Loans outstanding on the Closing Date
immediately after funding the Tranche B Term Facility and (ii) on the Tranche B
Term Loan Maturity Date in an amount equal to all remaining outstanding Tranche
B Term Loans of such Tranche B Term Lender.

2.4 Revolving Commitments.

(a) Subject to the terms and conditions hereof, (1) each Dollar Revolving Lender
severally agrees to make revolving credit loans in Dollars (“Dollar Revolving
Loans”) to the Borrower from time to time during the Revolving Commitment Period
in an aggregate principal amount at any one time outstanding which does not
exceed the amount of such Lender’s Dollar Revolving Commitment and (2) each
Alternative Currency Revolving Lender severally agrees to make revolving credit
loans in one or more Alternative Currencies (“Alternative Currency Revolving
Loans”) to the Borrower from time to time during the Revolving Commitment Period
in an aggregate principal amount at any one time outstanding which, when added
to such Lender’s Alternative Currency Revolving Percentage of the sum of

 

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(i) the LC Obligations then outstanding and (ii) the aggregate principal amount
of the Swingline Loans then outstanding, does not exceed the amount of such
Lender’s Alternative Currency Revolving Commitment. During the Revolving
Commitment Period the Borrower may use the Revolving Commitments by borrowing,
prepaying the Revolving Loans in whole or in part, and reborrowing, all in
accordance with the terms and conditions hereof. The Dollar Revolving Loans and
Alternative Currency Revolving Loans denominated in Dollars may from time to
time be Eurodollar Loans or ABR Loans, as determined by the Borrower and
notified to the Administrative Agent in accordance with Sections 2.5 and 2.12.
The Alternative Currency Revolving Loans denominated in an Alternative Currency
other than Dollars shall be Eurodollar Loans.

(b) The Borrower shall repay all outstanding Revolving Loans on the applicable
Maturity Date.

2.5 Procedure for Revolving Loan Borrowing. The Borrower may borrow under the
Revolving Commitments during the Revolving Commitment Period on any Business
Day; provided that the Borrower shall give the Administrative Agent irrevocable
notice in the form of a Borrowing Request (which notice must be received by the
Administrative Agent prior to 2:00 P.M., New York City time, (a)(i) three
Business Days prior to the requested Borrowing Date, in the case of Eurodollar
Loans denominated in Dollars or (ii) four Business Days prior to the requested
Borrowing Date, in the case of Eurodollar Loans denominated in Alternative
Currencies (other than Dollars), or (b) one Business Day prior to the requested
Borrowing Date, in the case of ABR Loans) (provided that any such notice of a
borrowing of ABR Loans under the Alternative Currency Revolving Facility to
finance payments required by Section 3.5 may be given not later than 1:00 P.M.,
New York City time, on the date of the proposed borrowing), specifying (i) the
amount of Revolving Loans to be borrowed, (ii) the requested Borrowing Date,
(iii) the Revolving Facility pursuant to which such Loan is to be made, (iv) the
currency of the Revolving Loans to be borrowed, (v) if the Revolving Loans to be
borrowed are denominated in Dollars, the Type of Revolving Loans to be borrowed
and (vi) in the case of Eurodollar Loans, the respective amounts of each such
Type of Loan and the respective lengths of the initial Interest Period therefor.
Each borrowing under the Dollar Revolving Commitments and each borrowing under
the Alternative Currency Revolving Commitments denominated in Dollars shall be
in an amount equal to (x) in the case of ABR Loans, $1,000,000 or a whole
multiple thereof (or, if the then aggregate Available Revolving Commitments are
less than $1,000,000, such lesser amount) and (y) in the case of Eurodollar
Loans, $5,000,000 or a whole multiple of $1,000,000 in excess thereof; provided
that the Swingline Lender may request, on behalf of the Borrower, borrowings
denominated in Dollars under the Alternative Currency Revolving Commitments that
are ABR Loans in other amounts pursuant to Section 2.7. Each borrowing under the
Alternative Currency Revolving Commitments (other than a borrowing denominated
in Dollars) shall be in an amount equal to the Alternative Currency Equivalent
of $5,000,000 or a whole multiple of $1,000,000 in excess thereof. Upon receipt
of any such notice from the Borrower, the Administrative Agent shall promptly
notify each Revolving Lender thereof. Each Revolving Lender will make the amount
of its pro rata share of each borrowing available to the Administrative Agent
for the account of the Borrower at the Funding Office for the applicable
currency prior to 12:00 Noon, New York City time, on the Borrowing Date
requested by the Borrower in funds immediately available to the Administrative
Agent. Such borrowing will then be made available to the Borrower by the
Administrative Agent crediting the account of the Borrower on the books of such
office with the aggregate of the amounts made available to the Administrative
Agent by the Revolving Lenders and in like funds as received by the
Administrative Agent.

2.6 Swingline Commitment.

(a) Subject to the terms and conditions hereof, the Swingline Lender agrees to
make a portion of the credit otherwise available to the Borrower under the
Alternative Currency Revolving

 

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Commitments from time to time after the Closing Date and during the Revolving
Commitment Period by making swing line loans denominated in Dollars (“Swingline
Loans”) to the Borrower; provided that (i) the aggregate principal amount of
Swingline Loans outstanding at any time shall not exceed the Swingline
Commitment then in effect and (ii) the Borrower shall not request, and the
Swingline Lender shall not make, any Swingline Loan if, after giving effect to
the making of such Swingline Loan, the aggregate amount of the Available
Alternative Currency Revolving Commitments would be less than zero. During the
Revolving Commitment Period, the Borrower may use the Swingline Commitment by
borrowing, repaying and reborrowing, all in accordance with the terms and
conditions hereof. Swingline Loans shall be ABR Loans only.

(b) The Borrower shall repay to the Swingline Lender the then unpaid principal
amount of each Swingline Loan on the earlier of the applicable Maturity Date in
accordance with Section 2.7(f) and the first date after such Swingline Loan is
made that is the 15th or last day of a calendar month and is at least two
Business Days after such Swingline Loan is made; provided that on each date that
an Alternative Currency Revolving Loan denominated in Dollars is borrowed, the
Borrower shall repay all Swingline Loans then outstanding.

2.7 Procedure for Swingline Borrowing; Refunding of Swingline Loans.

(a) To request a Swingline Loan, the Borrower shall notify the Administrative
Agent of such request by telephone (confirmed by telecopy of a Borrowing
Request), not later than 2:00 P.M., New York City time, on the day (which shall
be a Business Day during the Revolving Commitment Period) of a proposed
Swingline Loan. Each such notice shall be irrevocable and shall specify the
requested date (which shall be a Business Day) and amount of the requested
Swingline Loan. The Administrative Agent will promptly advise the Swingline
Lender of any such notice received from the Borrower. The Swingline Lender shall
make each Swingline Loan available to the Borrower by means of a credit to the
general deposit account of the Borrower with the Swingline Lender (or, in the
case of a Swingline Loan made to finance the reimbursement of an LC Disbursement
as provided in Section 3.5, by remittance to the Issuing Lender) by 4:00 P.M.,
New York City time, on the requested date of such Swingline Loan. Each borrowing
under the Swingline Commitment shall be in an amount equal to $500,000 or a
whole multiple of $100,000 in excess thereof.

(b) The Swingline Lender, at any time and from time to time in its sole and
absolute discretion may, on behalf of the Borrower (which hereby irrevocably
directs the Swingline Lender to act on its behalf), on one Business Day’s notice
given by the Swingline Lender no later than 2:00 P.M., New York City time,
request each Alternative Currency Revolving Lender to make, and each Alternative
Currency Revolving Lender hereby agrees to make, an Alternative Currency
Revolving Loan denominated in Dollars, in an amount equal to such Alternative
Currency Revolving Lender’s Alternative Currency Revolving Percentage of the
aggregate amount of the Swingline Loans; provided that, notwithstanding the
foregoing, no Alternative Currency Revolving Lender shall be obligated to make
any Alternative Currency Revolving Loan if after giving effect to the making of
such Alternative Currency Revolving Loan the outstanding amount of Alternative
Currency Revolving Extensions of Credit of such Lender exceed such Lender’s
Alternative Currency Revolving Commitment (the “Refunded Swingline Loans”)
outstanding on the date of such notice, to repay the Swingline Lender. Each
Alternative Currency Revolving Lender shall make the amount of such Alternative
Currency Revolving Loan available to the Administrative Agent at the Funding
Office for Dollar-denominated payments in immediately available funds, not later
than 10:00 A.M., New York City time, one Business Day after the date of such
notice. The proceeds of such Alternative Currency Revolving Loans shall be
immediately made available by the Administrative Agent to the Swingline Lender
for application by the Swingline Lender to the repayment of the Refunded
Swingline Loans. The Borrower irrevocably authorizes the Swingline Lender to
charge the

 

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Borrower’s accounts with the Administrative Agent (up to the amount available in
each such account) in order to immediately pay the amount of such Refunded
Swingline Loans to the extent amounts received from the Alternative Currency
Revolving Lenders are not sufficient to repay in full such Refunded Swingline
Loans.

(c) If prior to the time an Alternative Currency Revolving Loan denominated in
Dollars would have otherwise been made pursuant to Section 2.7(b), one of the
events described in Section 8.1(g) shall have occurred and be continuing with
respect to the Borrower or if for any other reason, as determined by the
Swingline Lender in its sole discretion, Alternative Currency Revolving Loans
may not be made as contemplated by Section 2.7(b), each Alternative Currency
Revolving Lender shall, on the date such Alternative Currency Revolving Loan was
to have been made pursuant to the notice referred to in Section 2.7(b), purchase
for cash an undivided participating interest in the then outstanding Swingline
Loans by paying to the Swingline Lender an amount (the “Swingline Participation
Amount”) equal to (i) such Alternative Currency Revolving Lender’s Alternative
Currency Revolving Percentage times (ii) the sum of the aggregate principal
amount of Swingline Loans then outstanding that were to have been repaid with
such Alternative Currency Revolving Loans.

(d) Whenever, at any time after the Swingline Lender has received from any
Alternative Currency Revolving Lender such Lender’s Swingline Participation
Amount, the Swingline Lender receives any payment on account of the Swingline
Loans, the Swingline Lender will distribute to such Lender its Swingline
Participation Amount (appropriately adjusted, in the case of interest payments,
to reflect the period of time during which such Lender’s participating interest
was outstanding and funded and, in the case of principal and interest payments,
to reflect such Lender’s pro rata portion of such payment if such payment is not
sufficient to pay the principal of and interest on all Swingline Loans then
due); provided, however, that in the event that such payment received by the
Swingline Lender is required to be returned, such Alternative Currency Revolving
Lender will return to the Swingline Lender any portion thereof previously
distributed to it by the Swingline Lender.

(e) Each Alternative Currency Revolving Lender’s obligation to make the Loans
referred to in Section 2.7(b) and to purchase participating interests pursuant
to Section 2.7(c) shall be absolute and unconditional and shall not be affected
by any circumstance, including (i) any setoff, counterclaim, recoupment, defense
or other right that such Alternative Currency Revolving Lender or the Borrower
may have against the Swingline Lender, the Borrower or any other Person for any
reason whatsoever; (ii) the occurrence or continuance of a Default or the
failure to satisfy any of the other conditions specified in Section 5; (iii) any
adverse change in the financial condition of the Borrower; (iv) any breach of
this Agreement or any other Loan Document by the Borrower, any other Loan Party
or any other Alternative Currency Revolving Lender; or (v) any other
circumstance, happening or event whatsoever, whether or not similar to any of
the foregoing.

(f) If the Maturity Date shall have occurred in respect of any tranche of
Alternative Currency Revolving Commitments at a time when another tranche or
tranches of Alternative Currency Revolving Commitments is or are in effect with
a longer Maturity Date, then on the earliest occurring Maturity Date all then
outstanding Swingline Loans shall be repaid in full (and there shall be no
adjustment to the participations in such Swingline Loans as a result of the
occurrence of such Maturity Date); provided, however, that if on the occurrence
of such earliest Maturity Date (after giving effect to any repayments of
Alternative Currency Revolving Loans and any reallocation of Letter of Credit
participations as contemplated in Section 3.10), there shall exist sufficient
unutilized Extended Revolving Commitments that are the Alternative Currency
Revolving Commitments so that the respective outstanding Swingline Loans could
be incurred pursuant to such Extended Revolving Commitments which will remain in
effect after the occurrence of such Maturity Date, then there shall be an
automatic adjustment on such date of

 

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the Swingline Participation Amounts of each Alternative Currency Revolving
Lender that is an Extending Revolving Lender and such outstanding Swingline
Loans shall be deemed to have been incurred solely pursuant to the relevant
Extended Revolving Commitments, and such Swingline Loans shall not be so
required to be repaid in full on such earliest Maturity Date.

2.8 Commitment Fees, etc.

(a) The Borrower agrees to pay to the Administrative Agent for the account of
each Revolving Lender a commitment fee for the period from and including the
Closing Date to the last day of the Revolving Commitment Period, computed at the
Commitment Fee Rate on the average daily amount of the Available Dollar
Revolving Commitment and/or Available Alternative Currency Revolving Commitment,
as applicable, of such Lender during the period for which payment is made,
payable quarterly in arrears on each Fee Payment Date, commencing on the first
such date to occur after the Closing Date and on the Maturity Date for the
Revolving Facility.

(b) The Borrower agrees to pay to the Administrative Agent the fees in the
amounts and on the dates previously agreed to in writing by the Borrower and the
Administrative Agent.

(c) The Borrower will pay a fee on all outstanding Letters of Credit at a per
annum rate equal to the Applicable Margin then in effect with respect to
Eurodollar Loans under the Alternative Currency Revolving Facility, shared
ratably among the Alternative Currency Revolving Lenders and payable quarterly
in arrears on each Fee Payment Date after the issuance date. In addition, the
Borrower shall pay to the Issuing Lender for its own account a fronting fee of
0.125% per annum on the undrawn and unexpired amount of each Letter of Credit,
payable quarterly in arrears on each Fee Payment Date after the issuance date.

(d) In addition to the foregoing fees, the Borrower shall pay or reimburse the
Issuing Lender for such normal and customary costs and expenses (including
issuance fees) as are incurred or charged by the Issuing Lender in issuing,
negotiating, effecting payment under, amending or otherwise administering any
Letter of Credit.

(e) The Borrower agrees to pay on the Closing Date (w) to each Tranche A Term
Lender party to this Agreement on the Closing Date, as fee compensation for the
funding of such Tranche A Term Lender’s Tranche A Term Loan, a funding fee in an
amount agreed between such Tranche A Term Lender and the Borrower, (x) to each
Tranche B Term Lender party to this Agreement on the Closing Date, as fee
compensation for the funding of such Tranche B Term Lender’s Tranche B Term
Loan, a funding fee in an amount equal to 0.50% of the stated principal amount
of such Tranche B Term Lender’s Tranche B Term Loan funded on the Closing Date,
(y) to each Dollar Revolving Lender party to this Agreement on the Closing Date,
as compensation for the Dollar Revolving Commitment of such Dollar Revolving
Lender, a commitment fee in the amount agreed between such Dollar Revolving
Lender and the Borrower and (z) to each Alternative Currency Revolving Lender
party to this Agreement on the Closing Date, as compensation for the Alternative
Currency Revolving Commitment of such Alternative Currency Revolving Lender, a
commitment fee in the amount agreed between such Alternative Currency Revolving
Lender and the Borrower.

(f) All fees payable hereunder (subject to Section 2.26) shall be paid on the
dates due, in immediately available funds, to the Administrative Agent (or to
the Issuing Lender, in the case of fees payable to it) for distribution, in the
case of facility fees and participation fees, to the Lenders. Fees paid shall
not be refundable under any circumstances.

 

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2.9 Termination or Reduction of Revolving Commitments. The Borrower shall have
the right, upon not less than three Business Days’ notice to the Administrative
Agent, to terminate, or from time to time to reduce the amount, of the Revolving
Commitments under one or more Revolving Facilities; provided that no such
termination or reduction of Revolving Commitments shall be permitted if, after
giving effect thereto and to any prepayments of the Revolving Loans and
Swingline Loans made on the effective date thereof, (i) the Total Alternative
Currency Revolving Extensions of Credit would exceed the Total Alternative
Currency Revolving Commitments, (ii) the Total Dollar Revolving Extensions of
Credit would exceed the Total Dollar Revolving Commitments or (iii) the Total
Revolving Extensions of Credit would exceed the Total Revolving Commitments. Any
such reduction shall be in an amount equal to (i) with respect to the
Alternative Currency Revolving Commitments, $1,000,000, a whole multiple
thereof, or the remaining aggregate amount of the Alternative Currency Revolving
Commitments, and shall reduce permanently the Alternative Currency Revolving
Commitments then in effect and (ii) with respect to the Dollar Revolving
Commitments, $1,000,000, a whole multiple thereof, or the remaining aggregate
amount of the Dollar Revolving Commitments, and shall reduce permanently the
Dollar Revolving Commitments then in effect. The Revolving Commitment (other
than any Extended Revolving Commitment) of each Revolving Lender shall
automatically and permanently terminate on the Revolving Termination Date. On
the respective Maturity Date applicable thereto, the Extended Revolving
Commitment of each Extending Revolving Commitment shall automatically and
permanently terminate.

2.10 Optional Prepayments. The Borrower may at any time and from time to time
prepay the Loans, in whole or in part, without premium (except as set forth in
Section 2.11(g)) or penalty, upon irrevocable notice delivered to the
Administrative Agent no later than 2:00 P.M., New York City time, (i) three
Business Days prior thereto, in the case of Eurodollar Loans denominated in
Dollars and (ii) four Business Days prior thereto in the case of Eurodollar
Loans denominated in Alternative Currencies (other than Dollars), and no later
than 2:00 P.M., New York City time, one Business Day prior thereto, in the case
of ABR Loans, which notice shall specify the date and amount of prepayment, the
installment or installments of the respective tranches of the Loans to be repaid
and whether the prepayment is of Eurodollar Loans or ABR Loans (it being
understood that the Borrower may elect to prepay one tranche of Term Loans
without prepaying another); provided that in the case of Swingline Loans notice
may be given no later than 2:00 P.M. New York City time on the date of
prepayment; and provided further that if a Eurodollar Loan is prepaid on any day
other than the last day of the Interest Period applicable thereto, the Borrower
shall also pay any amounts owing pursuant to Section 2.20. Upon receipt of any
such notice the Administrative Agent shall promptly notify each relevant Lender
thereof. If any such notice is given, the amount specified in such notice shall
be due and payable on the date specified therein, together with (except in the
case of Revolving Loans that are ABR Loans and Swingline Loans) accrued interest
to such date on the amount prepaid. Partial prepayments of a tranche of Term
Loans shall be in an aggregate principal amount of $1,000,000 or a whole
multiple thereof. Partial prepayments of Revolving Loans denominated in an
Alternative Currency (other than Dollars) shall be in an aggregate principal
amount of the Alternative Currency Equivalent of $1,000,000 or a whole multiple
thereof. Partial prepayments of Revolving Loans denominated in Dollars shall be
in an aggregate principal amount of $1,000,000 or a whole multiple thereof.
Partial prepayments of Swingline Loans shall be in an aggregate principal amount
of $100,000 or a whole multiple thereof.

2.11 Mandatory Prepayments and Commitment Reductions.

(a) If any Redeemable Preferred Interests or Debt shall be issued or incurred by
any Group Member (excluding any Debt incurred in accordance with Section 7.2 or
Capital Stock issued in compliance with Section 7) or any initial cash proceeds
that are related to a financing of a fixed principal amount of Receivables
Assets or any initial incremental cash proceeds that are related to financing an
increased fixed principal amount of Receivables Assets shall be received by
Borrower or any of its

 

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subsidiaries in connection with a Permitted Receivables Financing, an amount
equal to 100% of the Net Cash Proceeds thereof shall be applied on the date of
such issuance or incurrence toward the prepayment of the Term Loans and the
Revolving Loans as set forth in Section 2.11(d).

(b) If on any date any Group Member shall receive Net Cash Proceeds from any
Asset Sale or Recovery Event then, to the extent a Reinvestment Notice shall not
have been delivered in respect thereof, such Net Cash Proceeds shall be applied
within ten days after the date that all post-closing adjustments associated
therewith have been completed toward the prepayment of the Term Loans and the
Revolving Loans as set forth in Section 2.11(d); provided that, notwithstanding
the foregoing, on each Reinvestment Prepayment Date, an amount equal to the
Reinvestment Prepayment Amount with respect to the relevant Reinvestment Event
shall be applied toward the prepayment of the Term Loans and the Revolving Loans
as set forth in Section 2.11(d).

(c) If, for any Fiscal Year of the Borrower commencing with the Fiscal Year
ending December 31, 2011, there shall be Excess Cash Flow, the Borrower shall,
on the relevant Excess Cash Flow Application Date, apply the ECF Percentage of
such Excess Cash Flow toward the prepayment of the Term Loans and the reduction
of the Revolving Commitments as set forth in Section 2.11(d). Each such
prepayment and commitment reduction shall be made on a date (an “Excess Cash
Flow Application Date”) no later than five days after the earlier of (i) the
date on which the financial statements of the Borrower referred to in
Section 6.1(b), for the Fiscal Year with respect to which such prepayment is
made, are required to be delivered to the Administrative Agent (for distribution
to the Agents and the Lenders) and (ii) the date such financial statements are
actually delivered.

(d) Amounts to be applied in connection with prepayments made pursuant to this
Section 2.11 shall be applied, first, to the prepayment of the Term Loans in
accordance with Section 2.17(b) and, second, to reduce the Swingline Loans and
then Revolving Loans without a permanent reduction of the Revolving Commitments.
The application of any prepayment pursuant to this Section 2.11 shall be made,
first, to ABR Loans and, second, to Eurodollar Loans. Each prepayment of the
Loans under this Section 2.11 (except in the case of Revolving Loans that are
ABR Loans and Swingline Loans) shall be accompanied by accrued interest to the
date of such prepayment on the amount prepaid.

(e) Notwithstanding anything to the contrary in Section 2.11(d) or 2.17, with
respect to the amount of any mandatory prepayment described in Section 2.11 that
is allocated to Tranche B Term Loans (such amount, the “Tranche B Prepayment
Amount”), at any time when Tranche A Term Loans remain outstanding, the Borrower
will, in lieu of applying such amount to the prepayment of Tranche B Term Loans,
as provided in Section 2.11(d) above, on the date specified in Section 2.11 for
such prepayment, give the Administrative Agent telephonic notice (promptly
confirmed in writing) requesting that the Administrative Agent prepare and
provide to each Tranche B Term Lender a notice (each, a “Prepayment Option
Notice”) as described below. As promptly as practicable after receiving such
notice from the Borrower, the Administrative Agent will send to each Tranche B
Term Lender a Prepayment Option Notice, which shall be in the form of Exhibit G,
and shall include an offer by the Borrower to prepay on the date (each a
“Mandatory Prepayment Date”) that is 10 Business Days after the date of the
Prepayment Option Notice, the relevant Term Loans of such Lender by an amount
equal to the portion of the Tranche B Prepayment Amount indicated in such
Lender’s Prepayment Option Notice as being applicable to such Lender’s Tranche B
Term Loans. On the Mandatory Prepayment Date, (i) the Borrower shall pay to the
relevant Tranche B Term Lenders the aggregate amount necessary to prepay that
portion of the outstanding relevant Term Loans as described above in respect of
which such Lenders have accepted prepayment (it being understood that a failure
to respond to a Prepayment Option Notice shall be deemed an acceptance of the
prepayment referenced therein) and (ii) the Borrower shall pay to the Tranche A
Term Lenders an amount equal to the portion of the Tranche B Prepayment Amount
not accepted by the

 

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relevant Lenders, and such amount shall be applied to the prepayment of the
Tranche A Term Loans; provided that if after the application of amounts pursuant
to clause (ii), any portion of the Tranche B Prepayment Amount not accepted by
the Tranche B Term Lenders shall remain, such amount shall be used to prepay the
Tranche B Term Loans on a pro rata basis.

(f) Revolving Loan Prepayments.

(i) In the event of the termination of all the Alternative Currency Revolving
Commitments, the Borrower shall, on the date of such termination, repay or
prepay all its outstanding Alternative Currency Revolving Loans and all
outstanding Swingline Loans and replace all outstanding Letters of Credit or
cash collateralize all outstanding Letters of Credit in accordance with the
procedures set forth in Section 3.10. In the event of the termination of all the
Dollar Revolving Commitments, the Borrower shall, on the date of such
termination, repay or prepay all its outstanding Dollar Revolving Loans.

(ii) In the event of any partial reduction of the Alternative Currency Revolving
Commitments, then (x) at or prior to the effective date of such reduction, the
Administrative Agent shall notify the Borrower and the Alternative Currency
Revolving Lenders of the sum of the Alternative Currency Revolving Extensions of
Credit after giving effect thereto and (y) if the sum of the Alternative
Currency Revolving Extensions of Credit would exceed the aggregate amount of
Alternative Currency Revolving Commitments after giving effect to such
reduction, then the Borrower shall, on the date of such reduction, first, repay
or prepay Swingline Loans, second, repay or prepay Alternative Currency
Revolving Loans and third, replace outstanding Letters of Credit or cash
collateralize outstanding Letters of Credit in accordance with the procedures
set forth in Section 3.10, in an aggregate amount sufficient to eliminate such
excess. In the event of any partial reduction of the Dollar Revolving
Commitments, then (x) at or prior to the effective date of such reduction, the
Administrative Agent shall notify the Borrower and the Dollar Revolving Lenders
of the sum of the Dollar Revolving Extensions of Credit after giving effect
thereto and (y) if the sum of the Dollar Revolving Extensions of Credit would
exceed the aggregate amount of Dollar Revolving Commitments after giving effect
to such reduction, then the Borrower shall, on the date of such reduction, repay
or prepay Dollar Revolving Loans in an aggregate amount sufficient to eliminate
such excess

(iii) In the event that the sum of all Alternative Currency Revolving Lenders’
Alternative Currency Revolving Extensions of Credit exceeds the Alternative
Currency Revolving Commitments then in effect (including, without limitation, as
a result of any Revaluation Date), the Borrower shall, without notice or demand,
immediately first, repay or prepay Swingline Loans, second, repay or prepay
Alternative Currency Revolving Loans, and third, replace outstanding Letters of
Credit or cash collateralize outstanding Letters of Credit in accordance with
the procedures set forth in Section 3.10, in an aggregate amount sufficient to
eliminate such excess. In the event that the sum of all Dollar Revolving
Lenders’ Dollar Revolving Extensions of Credit exceeds the Dollar Revolving
Commitments then in effect, the Borrower shall, without notice or demand,
immediately repay or prepay Dollar Revolving Loans in an aggregate amount
sufficient to eliminate such excess

(iv) In the event that the aggregate LC Obligations exceed the LC Commitment
then in effect, the Borrower shall, without notice or demand, immediately
replace outstanding Letters of Credit or cash collateralize outstanding Letters
of Credit in accordance with the procedures set forth in Section 3.10, in an
aggregate amount sufficient to eliminate such excess.

(g) Prepayment Premium. Any prepayment of the Tranche B Term Loans prior to the
one year anniversary of the Closing Date with the proceeds of an offering or
incurrence of Debt (other than a Permitted Receivables Financing) shall be
accompanied by a premium equal to 1% of the aggregate principal amount of the
Tranche B Term Loans prepaid.

 

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2.12 Conversion and Continuation Options.

(a) The Borrower may elect from time to time to convert Eurodollar Loans
denominated in Dollars to ABR Loans by giving the Administrative Agent prior
irrevocable notice of such election pursuant to an Interest Election Request no
later than 2:00 P.M., Local Time, on the Business Day preceding the proposed
conversion date; provided that any such conversion of Eurodollar Loans may only
be made on the last day of an Interest Period with respect thereto. The Borrower
may elect from time to time to convert ABR Loans denominated in Dollars to
Eurodollar Loans by giving the Administrative Agent prior irrevocable notice of
such election no later than 2:00 P.M., Local Time, on the third Business Day
preceding the proposed conversion date (which notice shall specify the length of
the initial Interest Period therefor); provided that no ABR Loan under a
particular Facility may be converted into a Eurodollar Loan when any Event of
Default has occurred and is continuing and the Administrative Agent or the
Majority Facility Lenders in respect of such Facility have determined by written
notice in its or their sole discretion not to permit such conversions. Upon
receipt of any such notice the Administrative Agent shall promptly notify each
relevant Lender thereof. No Revolving Loan may be converted into or continued as
a Revolving Loan denominated in a different currency, but instead must be
prepaid in the original currency of such Revolving Loan and reborrowed in the
other currency.

(b) Any Eurodollar Loan may be continued as such upon the expiration of the then
current Interest Period with respect thereto by the Borrower giving irrevocable
notice to the Administrative Agent pursuant to an Interest Election Request, in
accordance with the applicable provisions of the term “Interest Period” set
forth in Section 1.1, of the length of the next Interest Period to be applicable
to such Loans; provided that the Borrower may not elect to continue a Eurodollar
Loan under a particular Facility as such when any Event of Default has occurred
and is continuing and the Administrative Agent has or the Majority Facility
Lenders in respect of such Facility have determined by written notice in its or
their sole discretion not to permit such continuations, and provided, further,
that if the Borrower shall fail to give any required notice as described above
in this paragraph or if such continuation is not permitted pursuant to the
preceding proviso (i) if such Loans are denominated in Dollars, such shall be
automatically converted to ABR Loans on the last day of such then expiring
Interest Period and (ii) if such Loans are denominated in an Alternative
Currency (other than Dollars), such Loans shall be automatically continued as
Eurodollar Loans with an Interest Period of one month. Upon receipt of any such
notice the Administrative Agent shall promptly notify each relevant Lender
thereof.

2.13 Limitations on Eurodollar Tranches. Notwithstanding anything to the
contrary in this Agreement, all borrowings, conversions and continuations of
Eurodollar Loans and all selections of Interest Periods shall be in such amounts
and be made pursuant to such elections so that (a) after giving effect thereto,
the aggregate principal amount of the Eurodollar Loans comprising each
Eurodollar Tranche shall be equal to (i) with respect to Eurodollar Loans
denominated in Dollars, $5,000,000 or a whole multiple of $1,000,000 in excess
thereof and (ii) with respect to Eurodollar Loans denominated in an Alternative
Currency (other than Dollars), the Alternative Currency Equivalent of $5,000,000
or a whole multiple of $1,000,000 in excess thereof and (b) no more than fifteen
Eurodollar Tranches shall be outstanding at any one time.

2.14 Interest Rates and Payment Dates.

(a) Each Eurodollar Loan shall bear interest for each day during each Interest
Period with respect thereto at a rate per annum equal to the Eurodollar Rate
determined for such day plus the Applicable Margin plus (in the case of an
Alternative Currency Revolving Loan of any Lender which is lent from a Lending
Office in the United Kingdom or a Participating Member State) the Mandatory
Cost.

 

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(b) Each ABR Loan shall bear interest at a rate per annum equal to the ABR plus
the Applicable Margin.

(c) Upon the occurrence and during the continuance of an Event of Default under
Section 8.1(a), (b) or (g), if all or a portion of the principal amount of any
Loan or Reimbursement Obligation or any interest payable on any Loan or
Reimbursement Obligation or any commitment fee or other amount payable hereunder
shall not be paid when due (whether at the stated maturity, by acceleration or
otherwise), such overdue amount shall bear interest at a rate per annum equal to
the greater or (i) the rate then applicable to ABR Loans under the relevant
Facility plus 2% (or, in the case of any such other amounts that do not relate
to a particular Facility, the rate then applicable to ABR Loans under the
Revolving Facility plus 2%) and (ii) the actual rate applicable to such amount
plus 2%, from the date of such non-payment until such amount is paid in full
(after as well as before judgment).

(d) Interest shall be payable in arrears on each Interest Payment Date; provided
that interest accruing pursuant to paragraph (c) of this Section shall be
payable from time to time on demand.

2.15 Computation of Interest and Fees.

(a) Interest and fees payable pursuant hereto shall be calculated on the basis
of a 360-day year for the actual days elapsed, except that, with respect to ABR
Loans the rate of interest on which is calculated on the basis of the Prime
Rate, the interest thereon shall be calculated on the basis of a 365- (or 366-,
as the case may be) day year for the actual days elapsed or, in the case of
interest in respect of Loans denominated in Alternative Currencies as to which
market practice differs from the foregoing, in accordance with such market
practice. The Administrative Agent shall as soon as practicable notify the
Borrower and the relevant Lenders of each determination of a Eurodollar Rate.
Any change in the interest rate on a Loan resulting from a change in the ABR or
the Eurocurrency Reserve Requirements shall become effective as of the opening
of business on the day on which such change becomes effective. The
Administrative Agent shall as soon as practicable notify the Borrower and the
relevant Lenders of the effective date and the amount of each such change in
interest rate.

(b) Each determination of an interest rate by the Administrative Agent pursuant
to any provision of this Agreement shall be conclusive and binding on the
Borrower and the Lenders in the absence of manifest error. The Administrative
Agent shall, at the request of the Borrower, deliver to the Borrower a statement
showing the quotations used by the Administrative Agent in determining any
interest rate pursuant to Section 2.14(a).

2.16 Inability to Determine Interest Rate. If prior to the first day of any
Interest Period:

(a) the Administrative Agent shall have determined (which determination shall be
conclusive and binding upon the Borrower) that, by reason of circumstances
affecting the relevant market, adequate and reasonable means do not exist for
ascertaining the Eurodollar Rate for such Interest Period, or

(b) the Administrative Agent shall have received notice from the Majority
Facility Lenders in respect of the relevant Facility that the Eurodollar Rate
determined or to be determined for such Interest Period will not adequately and
fairly reflect the cost to such Lenders (as conclusively certified by such
Lenders) of making or maintaining their affected Loans during such Interest
Period,

 

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the Administrative Agent shall give telecopy or telephonic notice thereof to the
Borrower and the relevant Lenders as soon as practicable thereafter. If such
notice is given (and until such notice is withdrawn), (w) any Eurodollar Loans
denominated in Dollars under the relevant Facility requested to be made on the
first day of such Interest Period shall be made as ABR Loans, (x) any Loans
denominated in Dollars under the relevant Facility that were to have been
converted on the first day of such Interest Period to Eurodollar Loans shall be
continued as ABR Loans, (y) any outstanding Eurodollar Loans denominated in
Dollars under the relevant Facility shall be converted, on the last day of the
then-current Interest Period, to ABR Loans and (z) any outstanding Eurodollar
Loans denominated in an Alternative Currency (other than Dollars) shall be
continued with an interest applicable thereto equal to the sum of (I) the
Applicable Margin for such Eurodollar Loans, (II) the rate for each day during
such Interest Period reasonably determined by the Administrative Agent to be the
cost of funds of representative participating members in the interbank
eurodollar market selected by the Administrative Agent (which may include
Lenders) for maintaining loans similar to the relevant Loans (provided that any
change in the rate determined pursuant to this clause (II) shall be effective as
of the opening of business on the effective day of any change in the relevant
component of such rate) and (III) the Mandatory Cost, if any, applicable to such
Loan. Until such notice has been withdrawn by the Administrative Agent, no
further Eurodollar Loans denominated in Dollars under the relevant Facility
shall be made or continued as such, nor shall the Borrower have the right to
convert Loans denominated in Dollars under the relevant Facility to Eurodollar
Loans.

2.17 Pro Rata Treatment and Payments.

(a) Each borrowing by the Borrower from the Lenders hereunder, each payment by
the Borrower on account of any commitment fee and any reduction of the
Commitments of the Lenders shall be made pro rata according to the respective
Tranche A Term Percentages, Tranche B Term Percentages, Dollar Revolving
Percentages or Alternative Currency Revolving Percentages, as the case may be,
of the relevant Lenders.

(b) Each payment (including each prepayment) by the Borrower on account of
principal of and interest on the Term Loans shall be made pro rata according to
the respective outstanding principal amounts of the Term Loans then held by the
Term Lenders (except as otherwise provided in Section 2.11(e) and except that an
optional prepayment pursuant to Section 2.10 need only be made pro rata
according to the respective outstanding principal amounts of the Term Loans of
the applicable tranche being prepaid then held by the Term Lenders). The amount
of each principal prepayment of the Term Loans shall be applied to reduce the
then remaining installments of the Tranche A Term Loans and Tranche B Term
Loans, as the case may be, pro rata based upon the respective then remaining
principal amounts thereof. Amounts prepaid on account of the Term Loans may not
be reborrowed.

(c) Each payment (including each prepayment) by the Borrower on account of
principal of and interest on the Revolving Loans shall be made pro rata
according to the respective outstanding principal amounts of the Revolving Loans
then held by the relevant Revolving Lenders.

(d) All payments (including prepayments) to be made by the Borrower hereunder,
whether on account of principal, interest, fees or otherwise, shall be made
without setoff or counterclaim and shall be made prior to 1:00 P.M., New York
City time, on the due date thereof to the Administrative Agent, for the account
of the Lenders, at the Funding Office for the applicable currency, in the
currency in which the applicable Loan was made and in immediately available
funds. The Administrative Agent shall distribute such payments to the Lenders
promptly upon receipt in like funds as received. If any payment hereunder (other
than payments on the Eurodollar Loans) becomes due and payable on a day other
than a Business Day, such payment shall be extended to the next succeeding
Business Day. If any payment on a Eurodollar Loan becomes due and payable on a
day other than a Business Day, the maturity

 

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thereof shall be extended to the next succeeding Business Day unless the result
of such extension would be to extend such payment into another calendar month,
in which event such payment shall be made on the immediately preceding Business
Day. In the case of any extension of any payment of principal pursuant to the
preceding two sentences, interest thereon shall be payable at the then
applicable rate during such extension.

(e) Unless the Administrative Agent shall have been notified in writing by any
Lender prior to a borrowing that such Lender will not make the amount that would
constitute its share of such borrowing available to the Administrative Agent,
the Administrative Agent may assume that such Lender is making such amount
available to the Administrative Agent, and the Administrative Agent may, in
reliance upon such assumption, make available to the Borrower a corresponding
amount. If such amount is not made available to the Administrative Agent by the
required time on the Borrowing Date therefor, such Lender shall pay to the
Administrative Agent, on demand, such amount with interest thereon, at a rate
equal to the greater of (i) the Federal Funds Effective Rate and (ii) a rate
determined by the Administrative Agent in accordance with banking industry rules
on interbank compensation, for the period until such Lender makes such amount
immediately available to the Administrative Agent. A certificate of the
Administrative Agent submitted to any Lender with respect to any amounts owing
under this paragraph shall be conclusive in the absence of manifest error. If
such Lender’s share of such borrowing is not made available to the
Administrative Agent by such Lender within three Business Days after such
Borrowing Date, the Administrative Agent shall also be entitled to recover such
amount with interest thereon at the rate per annum applicable to (i) with
respect to borrowings under the Dollar Revolving Facility, ABR Loans under the
Dollar Revolving Facility or (ii) with respect to borrowings under the
Alternative Currency Revolving Facility, Eurodollar Loans under the Alternative
Currency Revolving Facility, in each case, on demand, from the Borrower.

(f) Unless the Administrative Agent shall have been notified in writing by the
Borrower prior to the date of any payment due to be made by the Borrower
hereunder that the Borrower will not make such payment to the Administrative
Agent, the Administrative Agent may assume that the Borrower is making such
payment, and the Administrative Agent may, but shall not be required to, in
reliance upon such assumption, make available to the Lenders their respective
pro rata shares of a corresponding amount. If such payment is not made to the
Administrative Agent by the Borrower within three Business Days after such due
date, the Administrative Agent shall be entitled to recover, on demand, from
each Lender to which any amount which was made available pursuant to the
preceding sentence, such amount with interest thereon at the rate per annum
equal to the daily average Federal Funds Effective Rate. Nothing herein shall be
deemed to limit the rights of the Administrative Agent or any Lender against the
Borrower.

(g) If any Lender shall fail to make any payment required to be made by it
pursuant to Section 2.5, Section 2.7(c), Section 3.4, Section 3.5(e) or
Section 11.5(c), then the Administrative Agent may, in its discretion and
notwithstanding any contrary provision hereof, (i) apply any amounts thereafter
received by the Administrative Agent for the account of such Lender for the
benefit of the Administrative Agent, the Swingline Lender or the Issuing Lender
to satisfy such Lender’s obligations to it under such Section until all such
unsatisfied obligations are fully paid, and/or (ii) until such failure to make
payment has been cured, hold any such amounts in a segregated account as cash
collateral for, and application to, any future funding obligations of such
Lender under any such Section, in the case of each of clauses (i) and
(ii) above, in any order as determined by the Administrative Agent in its
discretion.

 

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2.18 Requirements of Law.

(a) If the adoption of or any change in any Requirement of Law or in the
interpretation or application thereof or compliance by any Lender with any
request or directive (whether or not having the force of law) from any central
bank or other Governmental Authority made subsequent to the Closing Date

(i) shall subject any Lender to any tax of any kind whatsoever with respect to
this Agreement, any Letter of Credit, any Application or any Eurodollar Loan
made by it, or change the basis of taxation of payments to such Lender in
respect thereof (except for Non-Excluded Taxes covered by Section 2.19 and Taxes
imposed on the overall net income of such Lender);

(ii) shall impose, modify or hold applicable any reserve, special deposit,
compulsory loan or similar requirement against assets held by, deposits or other
liabilities in or for the account of, advances, loans or other extensions of
credit by, or any other acquisition of funds by, any office of such Lender that
is not otherwise included in the determination of the Eurodollar Rate; or

(iii) shall impose on such Lender any other condition;

and the result of any of the foregoing is to increase the cost to such Lender,
by an amount that such Lender deems to be material, of making, converting into,
continuing or maintaining Eurodollar Loans or issuing or participating in
Letters of Credit, or to reduce any amount receivable hereunder in respect
thereof, then, in any such case, the Borrower shall promptly pay such Lender,
upon its demand, any additional amounts necessary to compensate such Lender for
such increased cost or reduced amount receivable. If any Lender becomes entitled
to claim any additional amounts pursuant to this paragraph, it shall promptly
notify the Borrower (with a copy to the Administrative Agent) of the event by
reason of which it has become so entitled.

(b) If any Lender shall have determined that the adoption of or any change in
any Requirement of Law regarding capital adequacy or in the interpretation or
application thereof or compliance by such Lender or any corporation Controlling
such Lender with any request or directive regarding capital adequacy (whether or
not having the force of law) from any Governmental Authority made subsequent to
the Closing Date (each, a “Change in Law”; provided, however, that
notwithstanding anything herein to the contrary, the Dodd-Frank Wall Street
Reform and Consumer Protection Act and all requests, rules, guidelines or
directives thereunder or issued in connection therewith shall be deemed to be a
“Change in Law” regardless of the date enacted, adopted or issued) shall have
the effect of reducing the rate of return on such Lender’s or such corporation’s
capital as a consequence of its obligations hereunder or under or in respect of
any Letter of Credit to a level below that which such Lender or such corporation
could have achieved but for such Change in Law (taking into consideration such
Lender’s or such corporation’s policies with respect to capital adequacy) by an
amount deemed by such Lender to be material, then from time to time, after
submission by such Lender to the Borrower (with a copy to the Administrative
Agent) of a written request therefor, the Borrower shall pay to such Lender such
additional amount or amounts as will compensate such Lender or such corporation
for such reduction.

(c) Each request by a Lender for the payment of an additional amount under this
Section 2.18 shall be accompanied by a certificate showing in reasonable detail
the method of calculation and the allocation (which shall be reasonable)
thereof. Such certificate as to any additional amounts payable pursuant to this
Section submitted by any Lender to the Borrower (with a copy to the
Administrative Agent) shall be conclusive in the absence of manifest error.
Notwithstanding anything to the contrary in this Section, the Borrower shall not
be required to compensate a Lender pursuant to this Section for any

 

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amounts incurred more than six months prior to the date that such Lender
notifies the Borrower of such Lender’s intention to claim compensation therefor;
provided that, if the change in law giving rise to such claim have a retroactive
effect, then such six-month period shall be extended to include the period of
such retroactive effect. The obligations of the Borrower pursuant to this
Section shall survive the termination of this Agreement and the payment of the
Loans and all other amounts payable hereunder.

2.19 Taxes.

(a) All payments made by any Loan Party under this Agreement or any other Loan
Document shall be made free and clear of, and without deduction or withholding
for or on account of, any Taxes, excluding overall net income taxes and
franchise taxes (imposed in lieu of net income taxes) imposed on the
Administrative Agent or any Lender by a jurisdiction as a result of the
recipient being organized or having its principal office or, in the case of any
Lender, having its applicable lending office in such jurisdiction or as a result
of any present or former connection between the Administrative Agent or any
Lender and the jurisdiction imposing such Taxes (other than a connection arising
solely from the Administrative Agent or such Lender having executed, delivered,
enforced, become a party to, performed its obligations under, received payments
under, received or perfected a security interest under, or engaged in any other
transaction pursuant to, any Loan Document), including branch profits taxes
imposed by the United States or any similar tax imposed by any other
jurisdiction in which the Borrower is located. If any such non-excluded Taxes
(“Non-Excluded Taxes”) or Other Taxes are required to be withheld or deducted
from any amounts payable (which shall include deductions applicable to
additional sums payable under this Section) to the Administrative Agent or any
Lender hereunder, the amounts so payable to the Administrative Agent or such
Lender shall be increased to the extent necessary to yield to the Administrative
Agent or such Lender (after payment of all Non-Excluded Taxes and Other Taxes)
interest or any such other amounts payable hereunder at the rates or in the
amounts specified in this Agreement; provided, however, that the Borrower shall
not be required to increase any such amounts payable to any Lender with respect
to any Non-Excluded Taxes (i) that are attributable to such Lender’s failure to
comply with the requirements of paragraph (e) or (f) of this Section, (ii) that
are United States federal withholding taxes imposed on amounts payable to such
Lender at the time such Lender becomes a party to this Agreement, except to the
extent that such Lender’s assignor (if any) was entitled, at the time of
assignment, to receive additional amounts from the Borrower with respect to such
Non-Excluded Taxes pursuant to this paragraph; provided that this subclause
(ii) shall not apply to any Tax imposed on a Lender in connection with an
interest or participation in any Loan or other obligation that such Lender was
required to acquire pursuant to Section 11.7 or (iii) that are imposed pursuant
to Sections 1471 through 1474 of the Code other than by reason of a change in
law after the date of this Agreement (such Non-Excluded Taxes referred to in
clauses (i) through (iii), “Additional Excluded Taxes”).

(b) In addition, the Borrower shall timely pay any Other Taxes to the relevant
Governmental Authority in accordance with applicable law.

(c) The Borrower and the Guarantors shall indemnify the Administrative Agent, or
the affected Lender, as applicable, within 10 days after demand therefor, for
the full amount of any Non-Excluded Taxes or Other Taxes, but excluding
Additional Excluded Taxes (including Non-Excluded Taxes or Other Taxes imposed
or asserted on or attributable to amounts payable under this Section, but
excluding Additional Excluded Taxes) paid by the Administrative Agent or such
Lender, as the case may be, and any penalties, interest and reasonable expenses
arising therefrom or with respect thereto, whether or not such Non-Excluded
Taxes or Other 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 a Lender (with a copy to the
Administrative Agent), or by the Administrative Agent on its own behalf or on
behalf of a Lender, shall be conclusive absent manifest error.

 

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(d) As soon as practicable after any payment of Non-Excluded Taxes or Other
Taxes by the Borrower to a Governmental Authority, the Borrower shall deliver to
the Administrative Agent 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 Administrative Agent.

(e) Each Lender that is not a “U.S. Person” as defined in Section 7701(a)(30) of
the Code (a “Non-U.S. Lender”) shall deliver to the Borrower and the
Administrative Agent (or, in the case of a Participant, to the Lender from which
the related participation shall have been purchased) two copies of either U.S.
Internal Revenue Service Form W-8BEN or Form W-8ECI, or, in the case of a
Non-U.S. Lender claiming exemption from U.S. federal withholding tax under
Section 871(h) or 881(c) of the Code with respect to payments of “portfolio
interest,” a statement substantially in the form of Exhibit J and a Form W-8BEN,
or any subsequent versions thereof or successors thereto, properly completed and
duly executed by such Non-U.S. Lender claiming complete exemption from, or a
reduced rate of, U.S. federal withholding tax on all payments by the Borrower
under this Agreement and the other Loan Documents. Such forms shall be delivered
by each Non-U.S. Lender on or before the date it becomes a party to this
Agreement (or, in the case of any Participant, on or before the date such
Participant purchases the related participation). In addition, each Non-U.S.
Lender shall deliver such forms promptly upon the obsolescence or invalidity of
any form previously delivered by such Non-U.S. Lender. Each Non-U.S. Lender
shall promptly notify the Borrower at any time it determines that it is no
longer in a position to provide any previously delivered certificate to the
Borrower (or any other form of certification adopted by the U.S. taxing
authorities for such purpose). Notwithstanding any other provision of this
paragraph, a Non-U.S. Lender shall not be required to deliver any form pursuant
to this paragraph that such Non-U.S. Lender is not legally able to deliver.

(f) A Lender that is entitled to an exemption from or reduction of non-U.S.
withholding tax under the law of the jurisdiction in which the Borrower is
located, or any treaty to which such jurisdiction is a party, with respect to
payments under this Agreement shall deliver to the Borrower (with a copy to the
Administrative Agent), at the time or times prescribed by applicable law or
reasonably requested by the Borrower, such properly completed and executed
documentation prescribed by applicable law as will permit such payments to be
made without withholding or at a reduced rate; provided that such Lender is
legally entitled to complete, execute and deliver such documentation and in such
Lender’s sole judgment such completion, execution or submission would not be
materially disadvantageous to such Lender and would not materially prejudice the
legal position of such Lender.

(g) If the Administrative Agent or any Lender determines, in its sole
discretion, that it has received a refund of any Non-Excluded Taxes or Other
Taxes as to which it has been indemnified by the Borrower or with respect to
which the Borrower has paid additional amounts pursuant to this Section 2.19, it
shall pay over such refund to the Borrower (but only to the extent of indemnity
payments made, or additional amounts paid, by the Borrower under this
Section 2.19 with respect to the Non-Excluded Taxes or Other Taxes giving rise
to such refund), net of all reasonable out-of-pocket expenses of the
Administrative Agent or such Lender and without interest (other than any
interest paid by the relevant Governmental Authority with respect to such
refund); provided that the Borrower, upon the request of the Administrative
Agent or such Lender, agrees to repay the amount paid over to the Borrower (plus
any penalties, interest or other charges imposed by the relevant Governmental
Authority) to the Administrative Agent or such Lender in the event the
Administrative Agent or such Lender is required to repay such refund to such
Governmental Authority. Notwithstanding anything to the contrary, in no event
will any Lender be required to pay any amount to the Borrower the payment of
which would place such Lender in a less favorable net after-tax position than
such Lender would have been in if the additional amounts giving rise to such
refund of any Non-Excluded Taxes or Other Taxes had never been paid. This

 

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paragraph shall not be construed to require the Administrative Agent or any
Lender to make available its tax returns (or any other information relating to
its taxes which it deems confidential) to the Borrower or any other Person.

(h) The agreements in this Section shall survive the termination of this
Agreement and the payment of the Loans and all other amounts payable hereunder.

2.20 Indemnity. The Borrower agrees to indemnify each Lender for, and to hold
each Lender harmless from, any loss or expense that such Lender may sustain or
incur as a consequence of (a) default by the Borrower in making a borrowing of,
conversion into or continuation of Eurodollar Loans after the Borrower has given
a notice requesting the same in accordance with the provisions of this
Agreement, (b) default by the Borrower in making any prepayment of or conversion
from Eurodollar Loans after the Borrower has given a notice thereof in
accordance with the provisions of this Agreement or (c) the making of a
prepayment of Eurodollar Loans on a day that is not the last day of an Interest
Period with respect thereto. Such indemnification may include an amount equal to
the excess, if any, of (i) the amount of interest that would have accrued on the
amount so prepaid, or not so borrowed, converted or continued, for the period
from the date of such prepayment or of such failure to borrow, convert or
continue to the last day of such Interest Period (or, in the case of a failure
to borrow, convert or continue, the Interest Period that would have commenced on
the date of such failure) in each case at the applicable rate of interest for
such Loans provided for herein (excluding, however, the Applicable Margin
included therein, if any) minus (ii) the amount of interest (as reasonably
determined by such Lender) that would have accrued to such Lender on such amount
by placing such amount on deposit for a comparable period with leading banks in
the interbank eurodollar market. A certificate as to any amounts payable
pursuant to this Section submitted to the Borrower by any Lender shall be
conclusive in the absence of manifest error. This covenant shall survive the
termination of this Agreement and the payment of the Loans and all other amounts
payable hereunder.

2.21 Change of Lending Office. Each Lender agrees that, upon the occurrence of
any event giving rise to the operation of Section 2.18 or 2.19(a) with respect
to such Lender, it will, if requested by the Borrower, use reasonable efforts
(subject to overall policy considerations of such Lender) to designate another
lending office for any Loans affected by such event with the object of avoiding
the consequences of such event; provided that such designation is made on terms
that, in the sole judgment of such Lender, cause such Lender and its lending
office(s) to suffer no economic, legal or regulatory disadvantage, and provided,
further, that nothing in this Section shall affect or postpone any of the
obligations of the Borrower or the rights of any Lender pursuant to Section 2.18
or 2.19(a).

2.22 Replacement of Lenders. The Borrower shall be permitted to replace any
Lender that (a) requests reimbursement for amounts owing pursuant to
Section 2.18 or 2.19(a), (b) is a Defaulting Lender or (c) is replaced pursuant
to the third paragraph of Section 11.1 with a replacement financial institution;
provided that (i) such replacement does not conflict with any Requirement of
Law, (ii) no Event of Default shall have occurred and be continuing at the time
of such replacement, (iii) if applicable, prior to any such replacement, such
Lender shall not have taken appropriate action under Section 2.21 so as to
eliminate the continued need for payment of amounts owing pursuant to
Section 2.18 or 2.19(a), (iv) the replacement financial institution shall
purchase, at par, all Loans and other amounts owing to such replaced Lender on
or prior to the date of replacement, (v) the Borrower shall be liable to such
replaced Lender under Section 2.20 if any Eurodollar Loan owing to such replaced
Lender shall be purchased other than on the last day of the Interest Period
relating thereto, (vi) the replacement financial institution, if not already a
Lender, shall be reasonably satisfactory to the Administrative Agent, (vii) the
replaced Lender shall be obligated to make such replacement in accordance with
the provisions of Section 11.6 (provided that the Borrower shall be obligated to
pay the registration and processing fee referred to therein) and by

 

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its execution of this Agreement each Lender hereby authorizes the Administrative
Agent to act as its agent in executing any documents to replace such Lender in
accordance with this Section 2.22, (viii) until such time as such replacement
shall be consummated, the Borrower shall pay all additional amounts (if any)
required pursuant to Section 2.18 or 2.19(a), as the case may be, and (ix) any
such replacement shall not be deemed to be a waiver of any rights that the
Borrower, the Administrative Agent or any other Lender shall have against the
replaced Lender. Notwithstanding the foregoing, this Section 2.22 may only be
utilized with respect to a replaced Lender in respect of any amendment to this
Agreement after the Closing Date and prior to the one-year anniversary of the
Closing Date that has the effect of reducing the Applicable Margin for the
Tranche B Term Loans if such replaced Tranche B Term Lender is paid a fee equal
to 1.0% of the principal amount of such Tranche B Term Lender’s Tranche B Term
Loans being replaced and repaid.

2.23 Repayment of Loans; Evidence of Debt.

(a) The Borrower hereby unconditionally promises to pay (i) to the
Administrative Agent for the account of each Lender the then unpaid principal
amount of each Revolving Loan on the Revolving Termination Date (or with respect
to any Revolving Loans outstanding with respect to an Extended Revolving
Commitment, the Maturity Date applicable thereto), (ii) to the Administrative
Agent for the account of each Lender the Term Loans in accordance with
Section 2.3; provided that, to the extent specified in the respective Extension
Offer, amortization payments with respect to Extended Term Loans for periods
prior to the Tranche A Term Loan Maturity Date and the Tranche B Term Loan
Maturity Date, as applicable, may be reduced (but not increased) and
amortization payments required with respect to Extended Term Loans for periods
after the Tranche A Term Loan Maturity Date and the Tranche B Term Loan Maturity
Date, as applicable, shall be as specified in the respective Extension Offer and
(iii) to the Swingline Lender the then unpaid principal amount of each Swingline
Loan in accordance with Section 2.6(b).

(b) Each Lender shall maintain in accordance with its usual practice an account
or accounts evidencing the indebtedness of the Borrower to such Lender resulting
from each Loan made by such Lender, including the amounts of principal and
interest payable and paid to such Lender from time to time hereunder.

(c) The Administrative Agent shall maintain accounts in which it shall record
(i) the amount of each Loan made hereunder, the Facility, Type and currency
thereof and the Interest Period applicable thereto, (ii) the amount of any
principal or interest due and payable or to become due and payable from the
Borrower to each Lender hereunder and (iii) the amount of any sum received by
the Administrative Agent hereunder for the account of the Lenders and each
Lender’s share thereof.

(d) The entries made in the accounts maintained pursuant to paragraph (b) or (c)
of this Section shall be prima facie evidence of the existence and amounts of
the obligations recorded therein; provided that the failure of any Lender or the
Administrative Agent to maintain such accounts or any error therein shall not in
any manner affect the obligation of the Borrower to repay the Loans in
accordance with the terms of this Agreement.

(e) Any Lender may request that Loans made by it be evidenced by a promissory
note. In such event, the Borrower shall prepare, execute and deliver to such
Lender a promissory note payable to the order of such Lender (or, if requested
by such Lender, to such Lender and its registered assigns) and in a form
approved by the Administrative Agent. Thereafter, the Loans evidenced by such
promissory note and interest thereon shall at all times (including after
assignment pursuant to Section 11.6) be represented by one or more promissory
notes in such form payable to the order of the payee named therein (or, if such
promissory note is a registered note, to such payee and its registered assigns).

 

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2.24 Increase in Commitments.

(a) The Borrower may by written notice to the Administrative Agent elect to
request (x) prior to the Revolving Termination Date, an increase to the existing
Revolving Commitments under one or more of the Revolving Facilities and/or
(y) the establishment of one or more new term loan Commitments (each, an
“Incremental Term Loan Commitment”) in an amount not less than $100,000,000
individually and in an amount such that the Total Facility Amount does not
exceed $4,000,000,000 (after giving effect to the requested increase). Each such
notice shall specify (i) the date (each, an “Increase Effective Date”) on which
Borrower proposes that the increased or new Commitments shall be effective,
which shall be a date not fewer than 10 Business Days after the date on which
such notice is delivered to the Administrative Agent and (ii) the identity of
each Assignee to whom Borrower proposes any portion of such increased or new
Commitments be allocated and the amounts of such allocations; provided that any
existing Lender approached to provide all or a portion of the increased or new
Commitments may elect or decline, in its sole discretion, to provide such
increased or new Commitment.

(b) The increased or new Commitments shall become effective, as of such Increase
Effective Date; provided that:

(i) each of the conditions set forth in Section 5.2 shall be satisfied;

(ii) no Default shall have occurred and be continuing or would result from the
borrowings to be made on the Increase Effective Date;

(iii) after giving pro forma effect to the borrowings to be made on the Increase
Effective Date and to any change in Consolidated EBITDA and any increase in Debt
resulting from the consummation of any acquisition permitted by this Agreement
concurrently with such borrowings as of the date of the most recent financial
statements delivered pursuant to Section 6.1(b) or (c), the Borrower shall be in
compliance with each of the covenants set forth in Section 7.16;

(iv) the Borrower shall make any payments required pursuant to Section 2.20 in
connection with any adjustment of Revolving Loans pursuant to Section 2.24(d);
and

(v) the Borrower shall deliver or cause to be delivered any legal opinions or
other documents reasonably requested by the Administrative Agent in connection
with any such transaction.

(c) The terms and provisions of Loans made pursuant to the new Commitments shall
be as follows:

(i) terms and provisions of Loans made pursuant to Incremental Term Loan
Commitments (“Incremental Term Loans”) shall be, except as otherwise set forth
herein or in the Increase Joinder, identical to the Tranche B Term Loans (it
being understood that Incremental Term Loans may be part of an existing tranche
of Term Loans);

(ii) all terms and provisions (including Maturity Date) of Revolving Loans made
pursuant to new Commitments shall be identical to the existing Revolving Loans;
provided that in connection with any such new Commitments for additional
Revolving Loans, the Borrower may pay to the Lenders providing such Commitments
a fee in an amount not to exceed the highest upfront fee paid to Revolving
Lenders of the applicable Revolving Facility on the Closing Date;

 

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(iii) the weighted average life to maturity of all new term loans under
Incremental Term Loan Commitments shall be no shorter than the weighted average
life to maturity of the existing Tranche B Term Loans;

(iv) the maturity date of Incremental Term Loans shall not be earlier than the
latest Maturity Date with respect to the Tranche B Term Loans as then in effect;
and

(v) the interest rate margins for the new term loans under Incremental Term Loan
Commitments shall be determined by Borrower and the applicable new Lenders;
provided, however, that the interest rate margins for the new term loans under
Incremental Term Loan Commitments shall not be greater than the highest interest
rate margins that may, under any circumstances, be payable with respect to any
tranche of Tranche B Term Loans plus 50 basis points (and the interest rate
margins applicable to the Tranche B Term Loans shall be increased to the extent
necessary to achieve the foregoing); provided, further, that in determining the
interest rate margins applicable to the existing Tranche B Term Loans, and the
Incremental Term Loans, as applicable, (x) original issue discount or upfront or
similar fees (collectively, “OID”) payable by the Borrower to the Lenders of the
existing Tranche B Term Loans or the Incremental Term Loans in the primary
syndication thereof shall be included (with OID being equated to interest based
on an assumed four-year life to maturity), (y) customary arrangement or
commitment fees payable to arrangers (or their respective affiliates) shall be
excluded and (z) if the Incremental Term Loans include an interest rate floor
greater than the interest rate floor applicable to the Tranche B Term Loans,
such increased amount shall be equated to interest rate margins for purposes of
determining whether an increase in the interest rate margins for the Tranche B
Term Loans shall be required, to the extent an increase in the interest rate
floor in the Tranche B Term Loans would cause an increase in the interest rate
margins, and in such case the interest rate floor (but not the Applicable
Margin) applicable to the Tranche B Term Loans shall be increased by such
increased amount.

The increased or new Commitments shall be effected by a joinder agreement (the
“Increase Joinder”) executed by Borrower, the Administrative Agent and each
Lender making such increased or new Commitment, in form and substance
satisfactory to each of them. The Increase Joinder may, without the consent of
any other Lenders, effect such amendments to this Agreement and the other Loan
Documents as may be necessary or appropriate, in the opinion of the
Administrative Agent, to effect the provisions of this Section 2.24.

(d) To the extent the Commitments being increased on the relevant Increase
Effective Date are Revolving Commitments, then each of the Revolving Lenders
having a Revolving Commitment under the applicable Revolving Facility prior to
such Increase Effective Date (the “Pre-Increase Revolving Lenders”) shall assign
to any Revolving Lender which is acquiring a new or additional Revolving
Commitment under the applicable Revolving Facility on the Increase Effective
Date (the “Post-Increase Revolving Lenders”), and such Post-Increase Revolving
Lenders shall purchase from each Pre-Increase Revolving Lender, at the principal
amount thereof, such interests in the Revolving Loans under the applicable
Revolving Facility (which purchases shall be deemed prepayments of such
Revolving Loans for purposes of Section 2.20) and, in the case of Alternative
Currency Revolving Commitments, participation interests in LC Obligations and
Swingline Loans outstanding on such Increase Effective Date as shall be
necessary in order that, after giving effect to all such assignments and
purchases, such Revolving Loans under the applicable Revolving Facility and, in
the case of Alternative Currency Revolving Commitments, participation interests
in LC Obligations and Swingline Loans will be held by Pre-Increase Revolving
Lenders and Post-Increase Revolving Lenders ratably in accordance with their
Revolving Commitments under the applicable Revolving Facility after giving
effect to such increased Revolving Commitments under the applicable Revolving
Facility.

 

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(e) On any Increase Effective Date on which new Commitments for term loans under
Incremental Term Loan Commitments are effective, subject to the satisfaction of
the foregoing terms and conditions, each Lender of such new Commitment shall
make a new Term Loan to the Borrower in an amount equal to its new Commitment.

(f) The Loans and Commitments established pursuant to this paragraph shall
constitute Loans and Commitments under, and shall be entitled to all the
benefits afforded by, this Agreement and the other Loan Documents, and shall,
without limiting the foregoing, benefit equally and ratably from Section 10
hereof and security interests created by the Security Documents. The Loan
Parties shall take any actions reasonably required by the Administrative Agent
to ensure and/or demonstrate that the Lien and security interests granted by the
Security Documents continue to be perfected under the UCC or otherwise after
giving effect to the establishment of any such class of Term Loans or any such
new Commitments.

2.25 Extensions of Term Loans and Revolving Commitments.

(a) Notwithstanding anything to the contrary in this Agreement, pursuant to one
or more offers (each, an “Extension Offer”) made from time to time by the
Borrower to all Lenders of Term Loans with a like Maturity Date or Revolving
Commitments with a like Maturity Date, in each case on a pro rata basis (based
on the aggregate outstanding principal amount of the respective Term Loans or
Revolving Commitments with the same Maturity Date, as the case may be) and on
the same terms to each such Lender, the Borrower may from time to time offer to
extend the maturity date of any Term Loans and/or Revolving Commitments under
any Revolving Facility and otherwise modify the terms of such Term Loans and/or
such Revolving Commitments pursuant to the terms of the relevant Extension Offer
(including, without limitation, by increasing the interest rate or fees payable
in respect of such Term Loans and/or such Revolving Commitments (and related
outstandings) and/or modifying the amortization schedule in respect of such
Lender’s Term Loans) (each, an “Extension,” and each group of Term Loans or
Revolving Commitments, as applicable, in each case as so extended, as well as
the original Term Loans and the original Revolving Commitments (in each case not
so extended), being a “tranche”; any Extended Term Loans shall constitute a
separate tranche of Term Loans from the tranche of Term Loans from which they
were converted, and any Extended Revolving Commitments shall constitute a
separate tranche of Revolving Commitments from the tranche of Revolving
Commitments from which they were converted), so long as the following terms are
satisfied: (i) no Default shall have occurred and be continuing at the time an
Extension Offer is delivered to the Lenders, (ii) except as to interest rates,
fees and final maturity, the Revolving Commitment under any Revolving Facility
of any Revolving Lender (an “Extending Revolving Lender”) extended pursuant to
an Extension (an “Extended Revolving Commitment”), and the related outstandings,
shall be a Revolving Commitment under such Revolving Facility (or related
outstandings, as the case may be) with the same terms as the applicable original
Revolving Commitments (and related outstandings); provided that (x) subject to
the provisions of Section 2.7(f) and Section 3.10 to the extent dealing with
Swingline Loans and Letters of Credit which mature or expire after a Maturity
Date when there exist Extended Revolving Commitments with a longer Maturity
Date, all Swingline Loans and Letters of Credit shall be participated in on a
pro rata basis by all Alternative Currency Revolving Lenders in accordance with
their pro rata share of the Alternative Currency Revolving Facility (and except
as provided in Section 2.7(f) or Section 3.10, without giving effect to changes
thereto on an earlier Maturity Date with respect to Swingline Loans and Letters
of Credit theretofore incurred or issued) and all borrowings under the
Alternative Currency Revolving Commitments and repayments thereunder shall be
made on a pro rata basis (except for (A) payments of interest and fees at
different rates

 

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on Extended Revolving Commitments (and related outstandings) and (B) repayments
required upon the Maturity Date of the non-extending Alternative Currency
Revolving Commitments) and (y) at no time shall there be Revolving Commitments
hereunder (including Extended Revolving Commitments and any original Revolving
Commitments) which have more than three different Maturity Dates, (iii) except
as to interest rates, fees, amortization, final maturity date, premium, required
prepayment dates and participation in prepayments (which shall, subject to
immediately succeeding clauses (iv), (v) and (vi), be determined by the Borrower
and set forth in the relevant Extension Offer), the Term Loans of any Term
Lender (an “Extending Term Lender”) extended pursuant to any Extension
(“Extended Term Loans”) shall have the same terms as the tranche of Term Loans
subject to such Extension Offer, (iv) the final maturity date of any Extended
Term Loans shall be no earlier than the then latest Maturity Date hereunder and
the amortization schedule applicable to Term Loans pursuant to Section 2.3 for
periods prior to the Tranche A Term Loan Maturity Date or the Tranche B Term
Loan Maturity Date, as applicable, may not be increased, (v) the Weighted
Average Life to Maturity of any Extended Term Loans shall be no shorter than the
remaining Weighted Average Life to Maturity of the Term Loans extended thereby,
(vi) any Extended Term Loans may participate on a pro rata basis or a less than
pro rata basis (but not greater than a pro rata basis) in any voluntary or
mandatory repayments or prepayments hereunder, in each case as specified in the
respective Extension Offer, (vii) if the aggregate principal amount of
applicable Term Loans (calculated on the face amount thereof) or applicable
Revolving Commitments, as the case may be, in respect of which applicable Term
Lenders or applicable Revolving Lenders, as the case may be, shall have accepted
the relevant Extension Offer (as hereinafter provided) shall exceed the maximum
aggregate principal amount of applicable Term Loans or applicable Revolving
Commitments, as the case may be, offered to be extended by the Borrower pursuant
to such Extension Offer, then the applicable Term Loans or applicable Revolving
Loans, as the case may be, of the applicable Term Lenders or applicable
Revolving Lenders, as the case may be, shall be extended ratably up to such
maximum amount based on the respective principal amounts (but not to exceed
actual holdings of record) with respect to which such Term Lenders or such
Revolving Lenders, as the case may be, have accepted such Extension Offer (as
hereinafter provided), (viii) all documentation in respect of such Extension
shall be consistent with the foregoing, and (ix) any applicable Minimum
Extension Condition shall be satisfied unless waived by the Borrower. If at the
time any Extension of Term Loans becomes effective, there will be Extended Term
Loans which remain outstanding from a prior Extension, then the interest rate
margins for the new Extended Term Loans shall not be greater than the highest
interest rate margins that may, under any circumstances, be payable with respect
to another tranche of Tranche B Term Loans plus 50 basis points (and the
interest rate margins applicable to each other applicable tranche of Tranche B
Term Loans shall be increased to the extent necessary to achieve the foregoing);
provided, further, that in determining the interest rate margins applicable to
any tranche of Tranche B Term Loans, as applicable, (x) OID payable by the
Borrower to the Lenders of each tranche of Tranche B Term Loans in the primary
syndication thereof shall be included (with OID being equated to interest based
on an assumed four-year life to maturity), (y) customary arrangement or
commitment fees payable to arrangers (or their respective affiliates) shall be
excluded and (z) if a new tranche of Tranche B Term Loans includes an interest
rate floor greater than the interest rate floor applicable to a then existing
tranche of Tranche B Term Loans, such increased amount shall be equated to
interest rate margins for purposes of determining whether an increase in the
interest rate margins for the then existing tranches of Tranche B Term Loans
shall be required, to the extent an increase in the interest rate floor in the
existing tranches of Tranche B Term Loans would cause an increase in the
interest rate margins, and in such case the interest rate floor (but not the
Applicable Margin) applicable to the existing tranches of Tranche B Term Loans
shall be increased by such increased amount. Following any such Extension Offer,
the Administrative Agent shall notify the applicable Lenders thereof, each of
whom shall, in its sole discretion, determine whether or not to accept such
Extension Offer.

(b) With respect to all Extensions accepted by the relevant Lenders and
consummated by the Borrower pursuant to this Section 2.25, (i) such Extensions
shall not constitute voluntary or

 

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mandatory payments or prepayments for purposes of Sections 2.10 and 2.11 and
(ii) no Extension Offer is required to be in any minimum amount or any minimum
increment; provided that the Borrower may at its election specify as a condition
(a “Minimum Extension Condition”) to consummating any such Extension that a
minimum amount (to be determined and specified in the relevant Extension Offer
in the Borrower’s sole discretion and which may be waived by the Borrower) of
Term Loans or Revolving Commitments (as applicable) of any or all applicable
tranches be tendered. The Administrative Agent and the Lenders hereby consent to
the Extensions and the other transactions contemplated by this Section 2.25
(including, for the avoidance of doubt, payment of any interest, fees or premium
in respect of any Extended Term Loans and/or Extended Revolving Commitments on
such terms as may be set forth in the relevant Extension Offer) and hereby waive
the requirements of any provision of this Agreement (including, without
limitation, Sections 2.10, 2.11 and 2.17) or any other Loan Document that may
otherwise prohibit any such Extension or any other transaction contemplated by
this Section 2.25.

(c) The Lenders hereby irrevocably authorize the Administrative Agent and
Collateral Agent to enter into amendments to this Agreement and the other Loan
Documents with the Borrower as may be necessary in order to establish new
tranches or sub-tranches in respect of Revolving Commitments or Term Loans so
extended and such technical amendments as may be necessary or appropriate in the
reasonable opinion of the Administrative Agent and the Borrower in connection
with the establishment of such new tranches or subtranches, in each case on
terms consistent with this Section 2.25. Notwithstanding the foregoing, each of
the Administrative Agent and the Collateral Agent shall have the right (but not
the obligation) to seek the advice or concurrence of the Required Lenders with
respect to any matter contemplated by this Section 2.25(c) and, if either the
Administrative Agent or the Collateral Agent seeks such advice or concurrence,
it shall be permitted to enter into such amendments with the Borrower in
accordance with any instructions actually received by such Required Lenders and
shall also be entitled to refrain from entering into such amendments with the
Borrower unless and until it shall have received such advice or concurrence;
provided, however, that whether or not there has been a request by the
Administrative Agent or the Collateral Agent for any such advice or concurrence,
all such amendments entered into with the Borrower by the Administrative Agent
or the Collateral Agent hereunder shall be binding and conclusive on the
Lenders. Without limiting the foregoing, in connection with any Extensions the
respective Loan Parties shall (at their expense) amend (and the Collateral Agent
is hereby directed to amend) any Mortgage that has a maturity date prior to the
then latest Maturity Date so that such maturity date is extended to the then
latest Maturity Date (or such later date as may be advised by local counsel to
the Collateral Agent).

(d) In connection with any Extension, the Borrower shall provide the
Administrative Agent at least five (5) Business Days’ (or such shorter period as
may be agreed by the Administrative Agent) prior written notice thereof, and
shall agree to such procedures, if any, as may be established by, or acceptable
to, the Administrative Agent, in each case acting reasonably to accomplish the
purposes of this Section 2.25.

(e) Notwithstanding the foregoing provisions of this Section 2.25 and, for the
avoidance of doubt, no Lender shall have such Lender’s Commitment or Loans
extended without the written consent of such Lender.

2.26 Defaulting Lenders. Notwithstanding any provision of this Agreement to the
contrary, if any Lender becomes a Defaulting Lender hereunder, then the
following provisions shall apply for so long as such Lender is a Defaulting
Lender:

(a) fees shall cease to accrue on the Commitment of such Defaulting Lender
pursuant to Section 2.8(a);

 

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(b) the Commitments and the Total Revolving Extensions of Credit of such
Defaulting Lender shall not be included in determining whether the Required
Lenders have taken or may take any action hereunder (including any consent to
any amendment, waiver or other modification pursuant to Section 11.1); provided
that this clause (b) shall not apply to the vote of a Defaulting Lender in the
case of an amendment, waiver or other modification requiring the consent of each
Lender or each Lender affected thereby;

(c) if any Swingline Loan or Letter of Credit is outstanding at the time such
Lender becomes a Defaulting Lender then:

(i) unless a Default shall have occurred and be continuing, all or any part of
the Swingline Participation Amount and LC Obligations of such Defaulting Lender
shall be reallocated among the non-Defaulting Lenders in accordance with their
respective Alternative Currency Revolving Percentages but only to the extent the
sum of all non-Defaulting Lenders’ Alternative Currency Revolving Extensions of
Credit plus such Defaulting Lender’s Swingline Participation Amount and LC
Obligations do not exceed the total of all non-Defaulting Lenders’ Alternative
Currency Revolving Commitments;

(ii) if the reallocation described in clause (i) above cannot, or can only
partially, be effected, the Borrower shall within one Business Day following
notice by the Administrative Agent (x) first, prepay such Swingline
Participation Amount and (y) second, cash collateralize for the benefit of the
Issuing Lender only the Borrower’s obligations corresponding to such Defaulting
Lender’s LC Obligations (after giving effect to any partial reallocation
pursuant to clause (i) above) in accordance with the procedures set forth in
Section 3.10 for so long as such LC Obligations are outstanding;

(iii) if the Borrower cash collateralizes any portion of such Defaulting
Lender’s Alternative Currency Revolving Percentage of the LC Obligations
pursuant to clause (ii) above, the Borrower shall not be required to pay any
fees to such Defaulting Lender pursuant to Section 2.8(c) with respect to such
Defaulting Lender’s Alternative Currency Revolving Percentage of the LC
Obligations during the period such Defaulting Lender’s LC Obligations are cash
collateralized;

(iv) if the LC Obligations of the non-Defaulting Lenders are reallocated
pursuant to clause (i) above, then the fees payable to the Lenders pursuant to
Section 2.8(a) and Section 2.8(c) shall be adjusted in accordance with such
non-Defaulting Lenders’ Alternative Currency Revolving Percentages; and

(v) if all or any portion of such Defaulting Lender’s LC Obligations is neither
reallocated nor cash collateralized pursuant to clause (i) or (ii) above, then,
without prejudice to any rights or remedies of the Issuing Lender or any other
Lender hereunder, all letter of credit fees payable under Section 2.8(c) with
respect to such Defaulting Lender’s LC Obligations shall be payable to the
Issuing Lender until and to the extent that such LC Obligations are reallocated
and/or cash collateralized; and

(d) so long as such Lender is a Defaulting Lender, the Swingline Lender shall
not be required to fund any Swingline Loan and the Issuing Lender shall not be
required to issue, amend or increase any Letter of Credit, unless it is
satisfied that the related exposure and the Defaulting Lender’s then outstanding
LC Obligations will be 100% covered by the Alternative Currency Revolving
Commitments of the non-Defaulting Lenders and/or cash collateral will be
provided by the Borrower in accordance with Section 2.26(c), and participating
interests in any newly made

 

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Swingline Loan or any newly issued or increased Letter of Credit shall be
allocated among non-Defaulting Alternative Currency Revolving Lenders in a
manner consistent with Section 2.26(c)(i) (and such Defaulting Lender shall not
participate therein).

If (i) a Bankruptcy Event with respect to a Parent of any Lender shall occur
following the date hereof and for so long as such event shall continue or
(ii) the Swingline Lender or the Issuing Lender has a good faith belief that any
Lender has defaulted in fulfilling its obligations under one or more other
agreements in which such Lender commits to extend credit, the Swingline Lender
shall not be required to fund any Swingline Loan and the Issuing Lender shall
not be required to issue, amend or increase any Letter of Credit, unless the
Swingline Lender or the Issuing Lender, as the case may be, shall have entered
into arrangements with the Borrower or such Lender, satisfactory to the
Swingline Lender or the Issuing Lender, as the case may be, to defease any risk
to it in respect of such Lender hereunder.

In the event that the Administrative Agent, the Borrower, the Swingline Lender
and the Issuing Lender each agrees that a Defaulting Lender has adequately
remedied all matters that caused such Lender to be a Defaulting Lender, then the
Swingline Participation Amount and LC Obligations of the Lenders shall be
readjusted to reflect the inclusion of such Lender’s Alternative Currency
Revolving Commitment and on such date such Lender shall purchase at par such of
the Revolving Loans of the other Lenders (other than Swingline Loans) as the
Administrative Agent shall determine may be necessary in order for such Lender
to hold such Loans in accordance with its Revolving Percentage.

SECTION 3

LETTERS OF CREDIT

3.1 LC Commitment.

(a) Subject to the terms and conditions hereof, the Issuing Lender, in reliance
on the agreements of the other Alternative Currency Revolving Lenders set forth
in Section 3.4, agrees to issue letters of credit denominated in Dollars
(“Letters of Credit”) for the account of the Borrower on any Business Day during
the Revolving Commitment Period in such form as may be approved from time to
time by the Issuing Lender; provided that the Issuing Lender shall have no
obligation to issue any Letter of Credit if, after giving effect to such
issuance, (i) the LC Obligations would exceed the LC Commitment or (ii) the
aggregate amount of the Available Alternative Currency Revolving Commitments
would be less than zero. Each Letter of Credit shall (i) be denominated in
Dollars and (ii) expire no later than the earlier of (x) the first anniversary
of its date of issuance and (y) the date that is fifteen Business Days prior to
the Revolving Termination Date (or with respect to any Letters of Credit
outstanding with respect to an Extended Revolving Commitment, the Maturity Date
applicable thereto); provided that any Letter of Credit with a one-year term may
provide for the renewal thereof for additional one-year periods (which shall in
no event extend beyond the date referred to in clause (y) above).

(b) The Issuing Lender shall not at any time be obligated to issue any Letter of
Credit if such issuance would conflict with, or cause the Issuing Lender or any
Alternative Currency Revolving Lender to exceed any limits imposed by, any
applicable Requirement of Law. In the event of any inconsistency between the
terms and conditions of this Agreement and the terms and conditions of any
Application or other agreement submitted by the Borrower to, or entered into by
the Borrower with, the Issuing Lender relating to any Letter of Credit, the
terms and conditions of this Agreement shall control.

(c) All Existing Letters of Credit shall be deemed to be issued hereunder and
shall constitute Letters of Credit subject to the terms hereof.

 

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3.2 Notice of Issuance, Amendment, Renewal, Extension; Certain Conditions. To
request the issuance of a Letter of Credit (or the amendment, renewal or
extension of an outstanding Letter of Credit), the Borrower shall hand deliver
or telecopy (or transmit by electronic communication, if arrangements for doing
so have been approved by the Issuing Lender) to the Issuing Lender and the
Administrative Agent (reasonably in advance of the requested date of issuance,
amendment, renewal or extension) a notice pursuant to an LC Request requesting
the issuance of a Letter of Credit, or identifying the Letter of Credit to be
amended, renewed or extended, and specifying the date of issuance, amendment,
renewal or extension (which shall be a Business Day), the date on which such
Letter of Credit is to expire (which shall comply with Section 3.1(a)), the
amount of such Letter of Credit, the name and address of the beneficiary thereof
and such other information as shall be necessary to prepare, amend, renew or
extend such Letter of Credit. If requested by the Issuing Lender, the Borrower
also shall submit an Application on the Issuing Lender’s standard form in
connection with any request for a Letter of Credit. A Letter of Credit shall be
issued, amended, renewed or extended only if (and upon issuance, amendment,
renewal or extension of each Letter of Credit the Borrower shall be deemed to
represent and warrant that), after giving effect to such issuance, amendment,
renewal or extension, (i) the LC Obligations shall not exceed the LC Commitment
and (ii) the Available Alternative Currency Revolving Commitments would not be
less than zero.

3.3 Fees and Other Charges. The Borrower shall pay the fees specified in
Section 2.8.

3.4 Participations. By the issuance of a Letter of Credit (or an amendment to a
Letter of Credit increasing the amount thereof) and without any further action
on the part of the Issuing Lender or the Lenders, the Issuing Lender hereby
grants to each Alternative Currency Revolving Lender, and each Alternative
Currency Revolving Lender hereby acquires from the Issuing Lender, a
participation in such Letter of Credit equal to such Lender’s Alternative
Currency Revolving Percentage of the aggregate amount available to be drawn
under such Letter of Credit. In consideration and in furtherance of the
foregoing, each Alternative Currency Revolving Lender hereby absolutely and
unconditionally agrees to pay to the Administrative Agent, for the account of
the Issuing Lender, such Lender’s Alternative Currency Revolving Percentage of
each LC Disbursement made by the Issuing Lender and not reimbursed by the
Borrower on the date due as provided in Section 3.5, or of any reimbursement
payment required to be refunded to the Borrower for any reason. Each Alternative
Currency Revolving Lender acknowledges and agrees that its obligation to acquire
participations pursuant to this paragraph in respect of Letters of Credit is
absolute and unconditional and shall not be affected by any circumstance
whatsoever, including any amendment, renewal or extension of any Letter of
Credit or the occurrence and continuance of a Default or reduction or
termination of the Alternative Currency Revolving Commitments, and that each
such payment shall be made without any offset, abatement, withholding or
reduction whatsoever.

3.5 Reimbursement. If the Issuing Lender shall make any LC Disbursement in
respect of a Letter of Credit, the Borrower shall reimburse such LC Disbursement
by paying to the Administrative Agent an amount equal to such LC Disbursement
not later than 1:00 P.M., New York City time, on the date that such LC
Disbursement is made, if the Borrower shall have received notice of such LC
Disbursement prior to 12:00 noon, New York City time, on such date, or, if such
notice has not been received by the Borrower prior to such time on such date,
then not later than 1:00 P.M., New York City time, on (i) the Business Day that
the Borrower receives such notice, if such notice is received prior to 12:00
noon, New York City time, on the day of receipt, or (ii) the Business Day
immediately following the day that the Borrower receives such notice, if such
notice is not received prior to such time on the day of receipt; provided that,
if such LC Disbursement is not less than $1,000,000, the Borrower may, subject
to the conditions to borrowing set forth herein, request in accordance with
Section 2.5 or 2.6 that such payment be financed with an Alternative Currency
Revolving Loan denominated in Dollars that is an

 

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ABR Loan or Swingline Loan in an equivalent amount and, to the extent so
financed, the Borrower’s obligation to make such payment shall be discharged and
replaced by the resulting Alternative Currency Revolving Loan denominated in
Dollars that is an ABR Loan or Swingline Loan. If the Borrower fails to make
such payment when due, the Administrative Agent shall notify each Alternative
Currency Revolving Lender of the applicable LC Disbursement, the payment then
due from the Borrower in respect thereof and such Lender’s Alternative Currency
Revolving Percentage thereof. Promptly following receipt of such notice, each
Alternative Currency Revolving Lender shall pay to the Administrative Agent its
Alternative Currency Revolving Percentage of the payment then due from the
Borrower, in the same manner as provided in Section 2.5 (without regard to
minimum amounts) and Section 2.17(e) with respect to Loans made by such
Alternative Currency Revolving Lender (and such Sections shall apply, mutatis
mutandis, to the payment obligations of the Alternative Currency Revolving
Lenders), and the Administrative Agent shall promptly pay to the Issuing Lender
the amounts so received by it from the Alternative Currency Revolving Lenders.
Promptly following receipt by the Administrative Agent of any payment from the
Borrower pursuant to this paragraph, the Administrative Agent shall distribute
such payment to the Issuing Lender or, to the extent that Alternative Currency
Revolving Lenders have made payments pursuant to this paragraph to reimburse the
Issuing Lender, then to such Alternative Currency Revolving Lenders and the
Issuing Lender as their interests may appear. Any payment made by a Alternative
Currency Revolving Lender pursuant to this paragraph to reimburse the Issuing
Lender for any LC Disbursement (other than the funding of ABR Alternative
Currency Revolving Loans or a Swingline Loan as contemplated above) shall not
constitute a Loan and shall not relieve the Borrower of its obligation to
reimburse such LC Disbursement.

3.6 Obligations Absolute. The Borrower’s obligation to reimburse LC
Disbursements as provided in Section 3.5 shall be absolute, unconditional and
irrevocable, and shall be performed strictly in accordance with the terms of
this Agreement under any and all circumstances whatsoever and irrespective of
(i) any lack of validity or enforceability of any Letter of Credit or this
Agreement, or any term or provision therein, (ii) any draft or other document
presented under a Letter of Credit proving to be forged, fraudulent or invalid
in any respect or any statement therein being untrue or inaccurate in any
respect, (iii) payment by the Issuing Lender under a Letter of Credit against
presentation of a draft or other document that does not comply with the terms of
such Letter of Credit, or (iv) any other event or circumstance whatsoever,
whether or not similar to any of the foregoing, that might, but for the
provisions of this Section, constitute a legal or equitable discharge of, or
provide a right of setoff against, the Borrower’s obligations hereunder. Neither
the Administrative Agent, the Lenders nor the Issuing Lender, nor any of their
Related Parties, shall have any liability or responsibility by reason of or in
connection with the issuance or transfer of any Letter of Credit or any payment
or failure to make any payment thereunder (irrespective of any of the
circumstances referred to in the preceding sentence), or any error, omission,
interruption, loss or delay in transmission or delivery of any draft, notice or
other communication under or relating to any Letter of Credit (including any
document required to make a drawing thereunder), any error in interpretation of
technical terms or any consequence arising from causes beyond the control of the
Issuing Lender; provided that the foregoing shall not be construed to excuse the
Issuing Lender from liability to the Borrower to the extent of any direct
damages (as opposed to consequential damages, claims in respect of which are
hereby waived by the Borrower to the extent permitted by applicable law)
suffered by the Borrower that are caused by the Issuing Lender’s failure to
exercise care when determining whether drafts and other documents presented
under a Letter of Credit comply with the terms thereof. The parties hereto
expressly agree that, in the absence of gross negligence or willful misconduct
on the part of the Issuing Lender (as finally determined by a court of competent
jurisdiction), the Issuing Lender shall be deemed to have exercised care in each
such determination. In furtherance of the foregoing and without limiting the
generality thereof, the parties agree that, with respect to documents presented
which appear on their face to be in substantial compliance with the terms of a
Letter of Credit, the Issuing Lender may, in its sole discretion, either accept
and make payment upon such documents without responsibility

 

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for further investigation, regardless of any notice or information to the
contrary, or refuse to accept and make payment upon such documents if such
documents are not in strict compliance with the terms of such Letter of Credit.

3.7 Disbursement Procedures. The Issuing Lender shall, promptly following its
receipt thereof, examine all documents purporting to represent a demand for
payment under a Letter of Credit. The Issuing Lender shall promptly notify the
Administrative Agent and the Borrower by telephone (confirmed by telecopy) of
such demand for payment and whether the Issuing Lender has made or will make an
LC Disbursement thereunder; provided that any failure to give or delay in giving
such notice shall not relieve the Borrower of its obligation to reimburse the
Issuing Lender and the Alternative Currency Revolving Lenders with respect to
any such LC Disbursement.

3.8 Interim Interest. If the Issuing Lender shall make any LC Disbursement,
then, unless the Borrower shall reimburse such LC Disbursement in full on the
date such LC Disbursement is made, the unpaid amount thereof shall bear
interest, for each day from and including the date such LC Disbursement is made
to but excluding the date that the Borrower reimburses such LC Disbursement, at
the rate per annum then applicable to Alternative Currency Revolving Loans
denominated in Dollars which are ABR Loans; provided that, if the Borrower fails
to reimburse such LC Disbursement when due pursuant to Section 3.5, then
Section 2.14(c) shall apply. Interest accrued pursuant to this Section shall be
for the account of the Issuing Lender, except that interest accrued on and after
the date of payment by any Alternative Currency Revolving Lender pursuant to
Section 3.5 to reimburse the Issuing Lender shall be for the account of such
Alternative Currency Revolving Lender to the extent of such payment.

3.9 Replacement of the Issuing Lender. The Issuing Lender may be replaced at any
time with another party eligible to become the Issuing Lender as provided
herein, by written notice given by the Borrower (with the approval of the
successor Issuing Lender and the Administrative Agent) to the replaced Issuing
Lender; provided that prior to such replacement all Letters of Credit issued by
the replaced Issuing Lender are terminated or cash collateralized on terms
satisfactory to the replaced Issuing Lender. The Administrative Agent shall
notify the Lenders of any such replacement of the Issuing Lender. At the time
any such replacement shall become effective, the Borrower shall pay all unpaid
fees accrued for the account of the replaced Issuing Lender pursuant to
Section 3.3). From and after the effective date of any such replacement, (i) the
successor Issuing Lender shall have all the rights and obligations of the
Issuing Lender under this Agreement with respect to Letters of Credit to be
issued thereafter and (ii) references herein to the term “Issuing Lender” shall
be deemed to refer to such successor or to any previous Issuing Lender, or to
such successor and all previous Issuing Lenders, as the context shall require.
After the replacement of an Issuing Lender hereunder, the replaced Issuing
Lender shall remain a party hereto and shall continue to have all the rights and
obligations of an Issuing Lender under this Agreement with respect to Letters of
Credit issued by it prior to such replacement, but shall not be required to
issue additional Letters of Credit.

3.10 Cash Collateralization. (i) If any Event of Default shall occur and be
continuing, on the Business Day that the Borrower receives notice from the
Administrative Agent or the Required Lenders (or, if the maturity of the Loans
has been accelerated, Lenders with LC Obligations representing greater than 50%
of the total LC Obligations) demanding the deposit of cash collateral pursuant
to this Section, or (ii) if required by Section 2.26(d), on the Business Day the
Borrower receives the notice contemplated by Section 2.26(c)(ii), the Borrower
shall deposit in an account with the Collateral Agent, in the name of the
Collateral Agent and for the benefit of the Secured Parties, an amount in cash
equal to 105% of the LC Obligations as of such date plus any accrued and unpaid
interest thereon; provided that the obligation to deposit such cash collateral
shall become effective immediately, and such deposit shall become immediately
due and payable, without demand or other notice of any kind, upon the occurrence

 

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of any Event of Default with respect to the Borrower described in
Section 8.1(g). Such deposit shall be held by the Collateral Agent as collateral
for the payment and performance of the obligations of the Borrower under this
Agreement. The Collateral Agent shall have exclusive dominion and control,
including the exclusive right of withdrawal, over such account. Other than any
interest earned on the investment of such deposits, which investments shall be
made at the option and sole discretion of the Collateral Agent and at the
Borrower’s risk and expense, such deposits shall not bear interest. Interest or
profits, if any, on such investments shall accumulate in such account. Moneys in
such account shall be applied by the Collateral Agent to reimburse the Issuing
Lender for LC Disbursements for which it has not been reimbursed and, to the
extent not so applied, shall be held for the satisfaction of the reimbursement
obligations of the Borrower for the LC Obligations at such time or, if the
maturity of the Loans has been accelerated (but subject to the consent of
Lenders with LC Obligations representing greater than 50% of the total LC
Obligations), be applied to satisfy other obligations of the Borrower under this
Agreement, and any surplus remaining shall be returned to the Borrower after all
Events of Default triggering such deposit cease to exist. If the Borrower is
required to provide an amount of cash collateral hereunder as a result of the
occurrence of an Event of Default, such amount (to the extent not applied as
aforesaid) shall be returned to the Borrower within three Business Days after
all Events of Default have been cured or waived.

3.11 Provisions Related to Extended Alternative Currency Revolving Commitments.
If the Maturity Date in respect of any tranche of Alternative Currency Revolving
Commitments occurs prior to the expiration of any Letter of Credit, then (i) if
one or more other tranches of Alternative Currency Revolving Commitments in
respect of which the Maturity Date shall not have occurred are then in effect,
such Letter of Credit shall automatically be deemed to have been issued
(including for purposes of the obligations of the Alternative Currency Revolving
Lenders to purchase participations therein and to make Alternative Currency
Revolving Loans and payments in respect thereof pursuant to Section 3.5) under
(and ratably participated in by Lenders pursuant to) the Alternative Currency
Revolving Commitments in respect of such non-terminating tranches up to an
aggregate amount not to exceed the aggregate principal amount of the unutilized
Alternative Currency Revolving Commitments thereunder at such time (it being
understood that no partial face amount of any Letter of Credit may be so
reallocated) and (ii) to the extent not reallocated pursuant to immediately
preceding clause (i), the Borrower shall cash collateralize any such Letter of
Credit in accordance with Section 3.10. Except to the extent of reallocations of
participations pursuant to clause (i) of the immediately preceding sentence, the
occurrence of a Maturity Date with respect to a given tranche of Alternative
Currency Revolving Commitments shall have no effect upon (and shall not
diminish) the percentage participations of the Alternative Currency Revolving
Lenders in any Letter of Credit issued before such Maturity Date.

SECTION 4

REPRESENTATIONS AND WARRANTIES

Each Loan Party represents and warrants to the Administrative Agent, the
Collateral Agent, the Issuing Lender and each of the Lenders that:

4.1 Organization; Power. Each Loan Party and each of its Subsidiaries (i) is
duly organized, validly existing and in good standing (if such concept is
applicable) under the laws of the jurisdiction of its organization, (ii) is duly
qualified and in good standing as a foreign business enterprise (if such concept
is applicable) in each other jurisdiction in which it owns or leases property or
in which the conduct of its business requires it to so qualify or be licensed
except where the failure to be so qualified or licensed would not, individually
or in the aggregate, result in a Material Adverse Effect and (iii) has all
requisite power and authority (including, without limitation, all material
Governmental Authorizations) to own or lease and operate its properties and to
carry on its business as now conducted and as proposed to be conducted.

 

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4.2 Capital Stock; Subsidiaries. Set forth on Schedule 1(a) to the Perfection
Certificate is a complete and accurate list of all Subsidiaries of the Borrower
as of the Closing Date, showing as of the Closing Date (as to each Loan Party)
the jurisdiction of its incorporation, the address of its principal place of
business and its U.S. taxpayer identification number or, in the case of any
non-U.S. Loan Party that does not have a U.S. taxpayer identification number,
its unique identification number issued to it by the jurisdiction of its
incorporation. The copy of the charter of each Loan Party and each amendment
thereto provided pursuant to Section 5.1(b) is a true and correct copy of each
such document, each of which is valid and in full force and effect as of the
Closing Date. As of the Closing Date, Schedule 10(a) to the Perfection
Certificate shows the number of shares or other units of each class of each
Subsidiary’s Capital Stock authorized, and the number outstanding, on the
Closing Date and the percentage of each such class of its Capital Stock owned
(directly or indirectly) by the Borrower or any Subsidiary thereof. All of the
outstanding Capital Stock of each such Subsidiary (A) (in the case of
Subsidiaries that are corporations) has been validly issued, is fully paid and
non-assessable and (B) to the extent owned by the Borrower or one or more of its
Subsidiaries, is free and clear of all Liens, except those created under the
Security Documents or Liens permitted pursuant to Section 7.1.

4.3 Authorization; No Conflicts. The execution, delivery and performance by each
Loan Party of each Loan Document to which it is or is to be a party, and the
consummation of the Transactions, are within such Loan Party’s corporate,
partnership or limited liability company powers, as applicable, have been duly
authorized by all necessary corporate, partnership or limited liability company
action, as applicable, do not (i) contravene such Loan Party’s Constitutive
Documents, (ii) violate any Requirements of Law, (iii) conflict with or result
in the breach of, or constitute a default or require any payment to be made
under, any material contract, loan agreement, indenture, mortgage, deed of
trust, lease or other instrument binding on or affecting any Loan Party or any
of its properties that would reasonably be likely to have a Material Adverse
Effect or (iv) except for the Liens created under the Loan Documents, result in
or require the creation or imposition of any Lien upon or with respect to any of
the properties of any Loan Party. No Loan Party is in violation of any such
Requirements of Law, the violation of which would be reasonably likely,
individually or in the aggregate, to have a Material Adverse Effect.

4.4 No Approvals. No Governmental Authorization, and no other authorization or
approval or other action by, and no notice to or filing with, any Governmental
Authority or any other third party is required for (i) the due execution,
delivery, recordation, filing or performance by any Loan Party of any Loan
Document to which it is or is to be a party, or for the consummation of the
Transactions, (ii) the grant by any Loan Party of the Liens granted by it
pursuant to the Security Documents, (iii) the perfection or maintenance of the
Liens created under the Security Documents on such of the Collateral located in
the United States in which a Lien may be perfected by the filing of financing
statements, the recordation of security agreements with the U.S. Patent and
Trademark Office or the U.S. Copyright Office or the delivery of Collateral
(including the first priority nature thereof) or (iv) the exercise by any Agent
or any Lender of its rights under the Loan Documents or the remedies in respect
of the Collateral pursuant to the Security Documents, except for (A) the
authorizations, approvals, filings and actions described on Schedule 4.4 hereto,
all of which either (i) have been duly obtained and are in full force and effect
or will be obtained and in full force and effect prior to the Closing Date or
(ii) the failure to obtain could not reasonably be expected to result in a
Material Adverse Effect, (B) filings, notices, recordings and other similar
actions necessary for the creation or perfection of the Liens and security
interests contemplated by the Loan Documents and (C) the actions required by
laws generally with respect to the exercise by secured creditors of their rights
and remedies.

 

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4.5 Enforceability. This Agreement has been, and each other Loan Document when
delivered hereunder will have been, duly executed and delivered by each Loan
Party thereto. This Agreement is, and each other Loan Document when delivered
hereunder will be, the legal, valid and binding obligation of each Loan Party
thereto, enforceable against such Loan Party in accordance with its terms,
subject to applicable bankruptcy, insolvency, reorganization, moratorium or
other laws affecting creditors’ rights generally and subject to general
principles of equity, regardless of whether considered in a proceeding in equity
or at law.

4.6 Litigation. There is no action, suit, investigation, litigation or
proceeding affecting any Loan Party or any of its Subsidiaries, including any
Environmental Action, pending or, to the knowledge of the Loan Parties,
threatened before any Governmental Authority or arbitrator (i) that, if
adversely determined, would be reasonably likely, individually or in the
aggregate, to have a Material Adverse Effect or (ii) that purports to affect the
legality, validity or enforceability of any Loan Document or the consummation of
the Transactions, except as disclosed prior to the Closing Date in the
Borrower’s filings made with the SEC.

4.7 Financial Statements; Projections.

(a) Historical Financial Statements. Borrower has heretofore delivered to the
Lenders the Consolidated balance sheets and related statements of income,
stockholders’ equity and cash flows of Borrower (i) as of and for the Fiscal
Years ended December 31, 2009, December 31, 2008 and December 31, 2007, audited
by and accompanied by the unqualified opinion of KPMG LLP, independent public
accountants, and (ii) as of and for the six-month period ended June 30, 2010 and
for the comparable period of the preceding Fiscal Year, in each case, certified
by the chief financial officer of Borrower. Such financial statements and all
financial statements delivered pursuant to Sections 6.1(b) and (c) have been
prepared in accordance with GAAP and present fairly in all material respects the
financial condition and results of operations and cash flows of Borrower as of
the dates and for the periods to which they relate except, in the case of
interim financial statements, for the absence of footnotes and the same being
subject to year end audit adjustments.

(b) No Liabilities. Except as set forth in the financial statements referred to
in Section 4.7(a), there are no liabilities of any Group Member of any kind,
whether accrued, contingent, absolute, determined, determinable or otherwise,
which could reasonably be expected to result in a Material Adverse Effect, and
there is no existing condition, situation or set of circumstances which could
reasonably be expected to result in such a liability, other than liabilities
under the Loan Documents and the Senior Notes Documents. Since December 31, 2009
there has been no event, change, circumstance or occurrence that, individually
or in the aggregate, has had or could reasonably be expected to have a Material
Adverse Effect (excluding the Borrower’s entering into the Loan Documents and
the Senior Notes Documents).

(c) Forecasts. The forecasts of financial performance of Borrower and its
subsidiaries furnished to the Lenders have been prepared in good faith by
Borrower and based on assumptions believed by Borrower to reasonable.

4.8 Properties.

(a) Generally. Each Group Member has good title to, or valid leasehold interests
in, all its property material to its business, free and clear of all Liens
except for Liens permitted pursuant to Section 7.1 and minor irregularities or
deficiencies in title that, individually and in the aggregate, do not interfere
with its ability to conduct its business as currently conducted or to utilize
such property for its intended purpose.

 

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(b) Real Property. Schedule 4.8 contains a true and complete list of each
interest in Real Property (i) owned by any Group Member as of the Closing Date
and describes the type of interest therein held by such Group Member and whether
such owned Real Property is leased and (ii) leased, subleased or otherwise
occupied or utilized by any Group Member, as lessee, sublessee, franchisee or
licensee, as of the Closing Date and describes the type of interest therein held
by such Group Member.

(c) Collateral. Each Group Member owns or has rights to use all of the
Collateral and all rights with respect to any of the foregoing used in,
necessary for or material to each Group Member’s business as currently
conducted. (i) To the knowledge of the Loan Parties, the use by each Group
Member of such Collateral and all such rights with respect to the foregoing do
not infringe on the rights of any Person other than such infringement which
could not, individually or in the aggregate, reasonably be expected to result in
a Material Adverse Effect and (ii) no claim has been made and remains
outstanding that any Group Member’s use of any Collateral does or may violate
the rights of any third party that could, individually or in the aggregate,
reasonably be expected to result in a Material Adverse Effect.

4.9 Intellectual Property.

(a) Ownership/No Claims. Except to the extent the same would not be expected,
individually or in the aggregate, to have a Material Adverse Effect, (i) each
Loan Party owns, or is licensed to use, all Intellectual Property necessary for
the conduct of its business as currently conducted, (ii) to the knowledge of
such Loan Party, no claim has been asserted and is pending by any Person
challenging or questioning the use of any such Intellectual Property or the
validity or effectiveness of any such Intellectual Property, nor does any Loan
Party know of any valid basis for any such claim and (iii) to the knowledge of
such Loan Party, the use of such Intellectual Property by each Loan Party does
not infringe the rights of any Person.

(b) Registrations. On and as of the Closing Date (i) each Loan Party owns and
possesses the right to use, and has done nothing to authorize or enable any
other Person to use, any copyright, patent or trademark (as such terms are
defined in the Security Agreement) listed in Schedule 12(a) or 12(b) to the
Perfection Certificate and (ii) all registrations listed in Schedule 12(a) or
12(b) to the Perfection Certificate are valid and in full force and effect.

(c) No Violations or Proceedings. To each Loan Party’s knowledge, on and as of
the Closing Date, there is no material violation by others of any right of such
Loan Party with respect to any copyright, patent or trademark listed in Schedule
12(a) or 12(b) to the Perfection Certificate, pledged by it under the name of
such Loan Party.

4.10 No Material Misstatements. Neither the Confidential Information Memorandum
nor any other information, exhibit or report furnished by any Loan Party to any
Agent or any Lender in connection with the negotiation and syndication of the
Loan Documents or pursuant to the terms of the Loan Documents taken as a whole
in combination with the Borrower’s most recent Form 10-K, and each Form 10-Q and
Form 8-K subsequent to such Form 10-K, in each case, filed or furnished with the
SEC, contained, as of the date such information exhibit or report was so
furnished, any untrue statement of a material fact or omitted to state a
material fact necessary to make the statements made therein not misleading,
except with respect to any projections or forecasts contained in such materials,
the Group Members represent only that the same were prepared in good faith on
the basis of assumptions believed to be reasonable, at the time made and at the
time furnished, it being recognized by the Lenders that such projections and
forecasts as they relate to future events are not to be viewed as fact and that
actual results during the period or periods covered by such projections and
forecasts may differ from such projections and forecasts.

 

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4.11 Margin Stock. No Group Member is engaged in the business of extending
credit for the purpose of purchasing or carrying Margin Stock, and no proceeds
of any Loan or drawings under any Letter of Credit will be used to purchase or
carry any Margin Stock or to extend credit to others for the purpose of
purchasing or carrying any Margin Stock, except for purchases of the Borrower’s
Capital Stock permitted by Section 7.7.

4.12 Investment Company Act. Neither any Loan Party nor any of its Subsidiaries
is an “investment company,” or an “affiliated person” of, or “promoter” or
“principal underwriter” for, an “investment company,” as such terms are defined
in the Investment Company Act of 1940, as amended. Neither the making of any
Loans, nor the issuance of any Letters of Credit, nor the application of the
proceeds or repayment thereof by the Borrower, nor the consummation of the other
transactions contemplated by the Loan Documents and Transaction Documents, will
violate any provision of any such Act or any rule, regulation or order of the
SEC thereunder.

4.13 Solvency. As of the Closing Date, and after giving effect to the incurrence
of all indebtedness and obligations being incurred on the Closing Date in
connection herewith, each Loan Party is, individually and together with its
Subsidiaries, Solvent.

4.14 Employee Benefit Plans.

(i) No ERISA Event has occurred or is reasonably expected to occur that has
resulted in or is reasonably expected to result in a material liability of any
Loan Party.

(ii) Schedule B (Actuarial Information) to the most recent annual report (Form
5500 Series) for each Plan, copies of which have been filed with the Internal
Revenue Service and furnished to the Lenders, is complete and accurate and
fairly presents the funding status of such Plan, and since the date of such
Schedule B there has been no material adverse change in such funding status.

(iii) Neither any Loan Party nor any ERISA Affiliate has incurred or is
reasonably expected to incur any Withdrawal Liability exceeding $100,000 to any
Multiemployer Plan.

(iv) Neither any Loan Party nor any ERISA Affiliate has been notified by the
sponsor of a Multiemployer Plan that such Multiemployer Plan is in
reorganization or has been terminated, within the meaning of Title IV of ERISA,
and no such Multiemployer Plan is reasonably expected to be in reorganization or
to be terminated, within the meaning of Title IV of ERISA.

(v) Each Loan Party is in compliance in all material respects with the presently
applicable provisions of ERISA and the Code with respect to each Plan.

(vi) The present value of all accumulated benefit obligations of all underfunded
Plans (based on the assumptions used for purposes of Statement of Financial
Accounting Standards No. 87) did not, as of the date of the most recent
financial statements reflecting such amounts, exceed the fair market value of
the assets of all such underfunded Plans by an amount that could reasonably be
expected to have a Material Adverse Effect.

(vii) The Loan Parties do not maintain or contribute to any plan, program,
policy, arrangement or agreement with respect to employees (or former employees)
employed outside the United States or Puerto Rico.

(viii) Each Loan Party is in compliance in all material respects with the
provisions of applicable law with respect to each employee benefit plan
maintained or contributed to with respect to

 

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employees (or former employees) employed in Puerto Rico. No Loan Party has
incurred, or reasonably expects to incur, any material obligation in connection
with the termination of, or withdrawal from, any employee benefit plan
maintained or contributed to with respect to employees (or former employees)
employed in Puerto Rico.

4.15 Environmental Laws.

(i) The operations and properties of each Loan Party comply with all applicable
Environmental Laws and Environmental Permits, except where any such failure to
comply would not be reasonably expected to have a Material Adverse Effect; any
past non-compliance with such Environmental Laws and Environmental Permits has
been resolved without ongoing obligations or costs, except where any such
failure to comply would not be reasonably expected, individually or in the
aggregate, to have a Material Adverse Effect; no Environmental Action is pending
or, to the Loan Parties’ knowledge threatened, against any Loan Party; and no
circumstances exist that, in each case, could be reasonably likely to (A) form
the basis of an Environmental Action against any Loan Party or any of properties
currently owned or operated by any of them that could, individually or in the
aggregate, have a Material Adverse Effect or (B) cause any such property owned
by any Loan Party to be subject to any restrictions on ownership, occupancy, use
or transferability under any Environmental Law that could, individually or in
the aggregate, have a Material Adverse Effect.

(ii) To Borrower’s knowledge, none of the properties currently or formerly owned
or operated by any Loan Party is listed or formally proposed for listing on the
NPL or on the CERCLIS or any analogous foreign, state or local list; and except
to the extent that any of the following would not, individually or in the
aggregate, reasonably be expected to have a Material Adverse Effect, (A) there
are no and, to the Loan Parties’ knowledge, never have been any underground or
aboveground storage tanks or related piping or any surface impoundments, land
disposal areas, septic tanks, pits, sumps or lagoons in which Hazardous
Materials are being or have been treated, stored or disposed on any property
currently owned or operated by any Loan Party or, to their knowledge, on any
property formerly owned or operated by any Loan Party, (B) there is no asbestos
or asbestos-containing material on or at any facility or property currently
owned or operated by any Loan Party, and (C) there has been no Release of
Hazardous Materials on, at, under or from any property currently or, to
Borrower’s knowledge formerly owned or operated by any Loan Party.

(iii)(A) No Loan Party is undertaking, and has not completed, either
individually or together with other potentially responsible parties, any
investigation or remedial or response action relating to any actual or
threatened Release of Hazardous Materials at any location; and (B) all Hazardous
Materials generated, used, treated, handled or stored at, or transported to or
from, any property currently or formerly owned or operated by any Loan Party
have been disposed of in a manner that could not reasonably be expected to
result in liability to any Loan Party that, in the case of (A) and (B), either
individually or in the aggregate, would have a Material Adverse Effect.

4.16 Taxes. Each Loan Party has duly filed, has caused to be duly filed or has
been included in all material tax returns (Federal, state, local and foreign)
required to be filed and has paid all material Taxes whether or not shown to be
due on a tax return, together with applicable interest and penalties. Each Loan
Party has made adequate provision in accordance with GAAP for all Taxes not yet
due and payable. Each Loan Party is unaware of any proposed or pending tax
assessments, deficiencies or audits that could be reasonably expected to,
individually or in the aggregate, result in a Material Adverse Effect. No Loan
Party has ever been a party to any understanding or arrangement constituting a
“tax shelter” within the meaning of Section 6662(d)(2)(C)(iii) of the Code or
within the meaning of Section 6111(c) or Section 6111(d) of the Code as in
effect immediately prior to the enactment of the American

 

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Jobs Creation Act of 2004, or has ever “participated” in a “reportable
transaction” within the meaning of Treasury Regulation Section 1.6011-4, except
as could not be reasonably expected to, individually or in the aggregate, result
in a Material Adverse Effect.

4.17 Government Reimbursement Programs; Medicare/Medicaid/Tricare.

(a) The dialysis facilities operated by each Group Member (the “Dialysis
Facilities”) are qualified for participation in the Medicare programs and the
Medicaid programs and Tricare programs in which they participate (together with
their respective intermediaries or carriers, the “Government Reimbursement
Programs”) and are entitled to reimbursement under Government Reimbursement
Programs for services rendered to qualified beneficiaries of Government
Reimbursement Programs in which the Borrower and its Subsidiaries participate
and comply in all material respects with the conditions of participation in all
Government Reimbursement Programs in which they participate or have
participated, except for the fact that Dialysis Facilities (i) newly developed
by Group Members may from time to time be awaiting an initial Medicare
certification and/or initial Medicare or Medicaid provider number in accordance
with normal business practice because of standard waiting times between the
proper timely filing of the relevant documents therefor and the receipt of such
certification and/or provider number and (ii) acquired by Group Members may from
time to time be awaiting a Medicare certification and/or Medicare or Medicaid
provider number issued in the name of such Group Member in accordance with
normal business practice because of standard waiting times between the proper
timely filing of the relevant documents therefor and the receipt of such
provider number. There is no pending or, to the Loan Parties’ knowledge,
threatened proceeding or investigation by any of the Government Reimbursement
Programs with respect to (i) any Group Member’s qualification or right to
participate in any Government Reimbursement Program in which it participates or
has participated, (ii) the compliance or non-compliance by any Group Member with
the terms or provisions of any Government Reimbursement Program in which it
participates or has participated, or (iii) the right of any Group Member to
receive or retain amounts received or due or to become due from any Government
Reimbursement Program in which it participates or has participated, which
proceeding or investigation, together with all other such proceedings and
investigations, would reasonably be expected to (x) have a Material Adverse
Effect or (y) result in Consolidated net operating revenues for any (including
any future) four Fiscal Quarter period of the Borrower constituting less than
95% of Consolidated net operating revenues for the immediately preceding four
Fiscal Quarter period of the Borrower.

(b) No Group Member nor any of their respective officers or directors, on behalf
of any Group Member, has (A) committed any act that would cause any of them to
incur a civil monetary penalty under or violated 42 U.S.C. § 1320a-7a or
§ 1320a-7b or knowingly or willfully violated any of the other federal statutes
applicable to Government Reimbursement Programs or the regulations promulgated
pursuant to such statutes or related state or local statutes or regulations,
including but not limited to the following: (i) knowingly and willfully making
or causing to be made a false statement or representation of a material fact in
any applications for any benefit or payment; (ii) knowingly and willfully making
or causing to be made any false statement or representation of a material fact
for use in determining rights to any benefit or payment; (iii) failing to
disclose knowledge by a claimant of the occurrence of any event affecting the
initial or continued right to any benefit or payment on its own behalf or on
behalf of another, with intent to secure such benefit or payment fraudulently;
(iv) knowingly and willfully soliciting, receiving, offering or paying any
remuneration (including any kickback, bribe or rebate), directly or indirectly,
overtly or covertly, in cash or in kind or offering to pay such remuneration
(a) in return for referring an individual to a Person for the furnishing or
arranging for the furnishing of any item or service for which payment may be
made in whole or in part by Medicare, Medicaid or other applicable government
payers, or (b) in return for purchasing, leasing or ordering or arranging for or
recommending the purchasing, leasing or ordering of any good, facility, service
or item for which payment may be made in whole or in part

 

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by Medicare, Medicaid or other applicable government payers, (B) knowingly and
willfully presented or caused to be presented a claim for a medical or other
item or service that was not provided as claimed, or was for a medical or other
item or service and the Person knew or should have known the claim was false or
fraudulent or (C) in violation of 42 U.S.C. § 1395nn, presented or caused to be
presented a claim to any individual, third party payor or other entity for a
designated health service furnished pursuant to a referral by a physician if the
physician (or an immediate family member) had a financial relationship with the
Borrower or any of its subsidiaries for which there was no permissible
exception, except in the case of each of (A), (B) and (C) as would not be
reasonably likely, individually or in the aggregate, to have a Material Adverse
Effect. Neither the Borrower nor any of its Subsidiaries, nor any of their
respective officers or directors, on behalf of the Borrower or any of its
Subsidiaries, has violated the federal false claims act, 31 U.S.C. §3729,
including, but not limited to, by (i) knowingly and willfully presenting or
causing to be presented to a government official a false claim for payment or
approval, (ii) knowingly and willfully making, using or causing to be made or
used, a false record or statement to get a false or fraudulent claim paid or
approved by the government or (iii) conspiring to defraud the government by
knowingly and willfully getting a false or fraudulent claim paid, except as
would not be reasonably likely, individually or in the aggregate, to have a
Material Adverse Effect. With respect to this Section, knowledge of an
individual director or officer of a Group Member of any of the events described
in this Section shall not be imputed to a Group Member unless such knowledge was
obtained or learned by the director or officer in his or her official capacity
as a director or officer of a Group Member. Except as individually or in the
aggregate could not reasonably be expected to have a Material Adverse Effect,
the Borrower any and each of its subsidiaries is in compliance with the privacy
and security rules promulgated under the Health Insurance Portability and
Accountability Act of 1996 found at 45 C.F.R. parts 160-164 (collectively,
“HIPAA”) and the amendments to HIPAA made under the Health Information
Technology for Economic and Clinical Health Act amendments to the American
Recovery and Reinvestment Act of 2009. To the knowledge of the Borrower, neither
the Borrower nor any of its subsidiaries has violated 18 U.S.C. § 1347
including, but not limited to, knowingly and willfully executing or attempting
to execute a scheme or artifice by means of false or fraudulent pretenses (i) to
defraud any health care benefit program, or (ii) to obtain any money or property
owned by, or under the custody or control of, any health benefit program.

4.18 Agreements. No Group Member is a party to any agreement or instrument or
subject to any corporate or other constitutional restriction that has resulted
or could reasonably be expected to result in a Material Adverse Effect. No Loan
Party is in default in any manner under any provision of any agreement or
instrument to which it is a party or by which it or any of its property is or
may be bound, and no condition exists which, with the giving of notice or the
lapse of time or both, would constitute such a default, in each case where such
default could reasonably be expected to result in a Material Adverse Effect.

4.19 Use of Proceeds. Borrower will use the proceeds of (a) the Tranche A Term
Loans and Tranche B Term Loans (i) to finance the Refinancing, (ii) for general
corporate purposes, including, without limitation, stock repurchases,
acquisitions and investments, and (iii) to pay related fees and expenses and
(b) the Revolving Loans and Swingline Loans on and after the Closing Date for
general corporate purposes (including, without limitation, stock repurchases,
acquisitions and investments).

4.20 Labor Matters. Except as, individually or in the aggregate, would not
reasonably be expected to have a Material Adverse Effect, as of the Closing
Date, (i) there are no strikes, lockouts or slowdowns against any Group Member
pending or, to the knowledge of any Group Member, threatened, (ii) the hours
worked by and payments made to employees of any Group Member have not been in
violation of the Fair Labor Standards Act of 1938, as amended, or any other
applicable Requirement of Law dealing with such matters and (iii) all payments
due from any Group Member on account of wages and

 

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employee health and welfare insurance and other benefits, have been paid or
accrued as a liability on the books of such Group Member. The consummation of
the Transactions will not give rise to any right of termination or right of
renegotiation on the part of any union under any collective bargaining agreement
to which any Group Member is bound.

4.21 Insurance. All insurance maintained by the Group Members is in full force
and effect, all premiums have been duly paid, no Group Member has received
notice of violation or cancellation thereof, the Premises, and the use,
occupancy and operation thereof, comply in all material respects with all
Insurance Requirements, and there exists no default under any Insurance
Requirement. Each Group Member has insurance in such amounts and covering such
risks and liabilities as are customary for companies of a similar size engaged
in similar businesses in similar locations.

4.22 Security Documents.

(a) Security Agreement. The Security Agreement is effective to create in favor
of the Collateral Agent for the benefit of the Secured Parties, legal, valid and
enforceable Liens on, and security interests in, the Security Agreement
Collateral and, when (i) the financing statements and other filings in
appropriate form are filed in the offices specified on Schedule 7 to the
Perfection Certificate and (ii) upon the taking of possession or control by the
Collateral Agent of the Security Agreement Collateral with respect to which a
security interest may be perfected only by possession or control (which
possession or control shall be given to the Collateral Agent to the extent
possession or control by the Collateral Agent is required by each Security
Agreement), the Liens created by the Security Agreement shall constitute fully
perfected Liens on, and security interests in, all right, title and interest of
the grantors in the Security Agreement Collateral (other than such Security
Agreement Collateral in which a security interest cannot be perfected under the
UCC as in effect at the relevant time in the relevant jurisdiction) in each case
subject to no Liens other than Liens permitted pursuant to Section 7.1.

(b) Copyright Office Filing. When the Security Agreement or a short form thereof
is filed in the United States Copyright Office, the Liens created by the
Security Agreement shall constitute fully perfected Liens on, and security
interests in, all right, title and interest of the grantors thereunder in the
Registered Copyrights and Registered Copyright Licenses (each as defined in the
Security Agreement), in each case subject to no Liens other than Liens permitted
pursuant to Section 7.1.

(c) Mortgages. Each Mortgage is effective to create, in favor of the Collateral
Agent, for its benefit and the benefit of the Secured Parties, legal, valid and
enforceable first priority Liens on, and security interests in, all of the Loan
Parties’ right, title and interest in and to the Mortgaged Properties thereunder
and the proceeds thereof, subject only to Liens permitted pursuant to
Section 7.1 or other Liens acceptable to the Collateral Agent, and when any
Mortgage executed and delivered after the date hereof in accordance with the
provisions of Sections 6.12 and 6.13 is filed in the offices specified in the
local counsel opinion delivered with respect thereto in accordance with the
provisions of Sections 6.12 and 6.13, the Mortgages shall constitute fully
perfected Liens on, and security interests in, all right, title and interest of
the Loan Parties in the Mortgaged Properties and the proceeds thereof, in each
case prior and superior in right to any other Person, other than Liens permitted
by such Mortgage.

(d) Valid Liens. Each Security Document delivered after the Closing Date
pursuant to Sections 6.12 and 6.13 will, upon execution and delivery thereof, be
effective to create in favor of the Collateral Agent, for the benefit of the
Secured Parties, legal, valid and enforceable Liens on, and security interests
in, all of the Loan Parties’ right, title and interest in and to the Collateral
thereunder, and when all appropriate filings or recordings are made in the
appropriate offices as may be required under applicable law, such Security
Document will constitute fully perfected Liens on, and security interests in,
all right, title and interest of the Loan Parties in such Collateral, in each
case subject to no Liens other than Liens permitted pursuant to Section 7.1.

 

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4.23 Anti-Terrorism Law. No Loan Party and, to the knowledge of the Loan
Parties, none of its Affiliates is in violation of any Requirement of Law
relating to terrorism or money laundering (“Anti-Terrorism Laws”), including
Executive Order No. 13224 on Terrorist Financing, effective September 24, 2001
(the “Executive Order”), and the Uniting and Strengthening America by Providing
Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001,
Public Law 107-56 (the “Patriot Act”).

No Loan Party and to the knowledge of the Loan Parties, no Affiliate of any Loan
Party acting or benefiting in any capacity in connection with the Loans is any
of the following:

(i) a Person that is listed in the annex to, or is otherwise subject to the
provisions of, the Executive Order;

(ii) a Person owned or Controlled by, or acting for or on behalf of, any Person
that is listed in the annex to, or is otherwise subject to the provisions of,
the Executive Order;

(iii) a Person with which any Lender is prohibited from dealing or otherwise
engaging in any transaction by any Anti-Terrorism Law;

(iv) a Person that commits, threatens or conspires to commit or supports
“terrorism” as defined in the Executive Order; or

(v) a Person that is named as a “specially designated national and blocked
person” on the most current list published by the U.S. Treasury Department
Office of Foreign Assets Control (“OFAC”) at its official website or any
replacement website or other replacement official publication of such list.

No Loan Party knowingly (i) conducts any business or engages in making or
receiving any contribution of funds, goods or services to or for the benefit of
any Person described in paragraph (b) above, (ii) deals in, or otherwise engages
in any transaction relating to, any property or interests in property blocked
pursuant to the Executive Order, or (iii) engages in or conspires to engage in
any transaction that evades or avoids, or has the purpose of evading or
avoiding, or attempts to violate, any of the prohibitions set forth in any
Anti-Terrorism Law.

SECTION 5

CONDITIONS PRECEDENT

5.1 Conditions to Initial Credit Extension. The obligation of each Lender and,
if applicable, the Issuing Lender to fund the initial Credit Extension requested
to be made by it shall be subject to the prior or concurrent satisfaction of
each of the conditions precedent set forth in this Section 5.1.

(a) Loan Documents. There shall have been delivered to the Administrative Agent
an executed counterpart of each of the Loan Documents and the Perfection
Certificate.

 

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(b) Corporate Documents. The Administrative Agent shall have received:

(i) a certificate of the secretary or assistant secretary of each Loan Party
dated the Closing Date, certifying (A) that attached thereto is a true and
complete copy of each Constitutive Document of such Loan Party certified (to the
extent applicable) as of a recent date by the Secretary of State of the state of
its organization, (B) that attached thereto is a true and complete copy of
resolutions duly adopted by the Board of Directors of such Loan Party
authorizing the execution, delivery and performance of the Loan Documents to
which such Loan Party is a party and, in the case of the Borrower, the
borrowings hereunder, and that such resolutions have not been modified,
rescinded or amended and are in full force and effect and (C) as to the
incumbency and specimen signature of each officer executing any Loan Document or
any other document delivered in connection herewith on behalf of such Loan Party
(together with a certificate of another officer as to the incumbency and
specimen signature of the secretary or assistant secretary executing the
certificate in this clause (i));

(ii) a certificate as to the good standing of each Loan Party (in so-called
“long-form” if available) as of a recent date, from such Secretary of State (or
other applicable Governmental Authority); and

(iii) such other documents as the Lenders, the Issuing Lender or the
Administrative Agent may reasonably request (including bring-down good standing
certificates).

(c) Officers’ Certificate. The Administrative Agent shall have received a
certificate, dated the Closing Date and signed by the chief executive officer
and the chief financial officer of the Borrower, confirming compliance with the
conditions precedent set forth in Sections 5.2(b) and (c).

(d) Financings and Other Transactions, Etc.

(i) The Refinancing shall have been consummated or shall be consummated on the
Closing Date, in each case in accordance with the terms hereof and the terms of
the Transaction Documents, without the waiver or amendment of any such terms not
approved by the Administrative Agent.

(ii) All Liens in favor of the existing lenders under the Existing Credit
Agreement shall simultaneously with the consummation of the Refinancing be
unconditionally released; and the Administrative Agent shall have received from
any Person holding any Lien securing any such debt, such UCC termination
statements, mortgage releases, releases of assignments of leases and rents,
releases of security interests in Intellectual Property and other instruments,
in each case in proper form for recording, as the Administrative Agent shall
have reasonably requested to release and terminate of record the Liens securing
such debt.

(iii) The Senior Notes shall have been issued or shall be issued on the Closing
Date.

(e) Opinions of Counsel. The Administrative Agent shall have received, on behalf
of itself, the other Agents, the Lenders and the Issuing Lender, a favorable
written opinion of (i) Sidley Austin, LLP, special counsel for the Loan Parties,
and (ii) Kim Rivera, General Counsel of the Borrower, in each case (A) dated the
Closing Date, (B) addressed to the Agents, the Issuing Lender and the Lenders
and (C) covering the matters set forth in Exhibit F-1 or F-2, as applicable, and
such other matters relating to the Loan Documents and the Transactions as the
Administrative Agent shall reasonably request.

 

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(f) Solvency Certificate. The Administrative Agent shall have received a
solvency certificate in the form of Exhibit C, dated the Closing Date and signed
by the chief financial officer of the Borrower.

(g) Fees. The arrangers and Administrative Agent shall have received all fees
and other amounts due and payable on or prior to the Closing Date, including, to
the extent invoiced, reimbursement or payment of all out-of-pocket expenses
(including the invoiced legal fees and expenses of Cahill Gordon & Reindel LLP,
special counsel to the Agents) required to be reimbursed or paid by the Borrower
on or prior to the Closing Date hereunder or under any other Loan Document.

(h) Personal Property Requirements. The Collateral Agent shall have received:

(i) the Intercompany Note executed by and among the Borrower and each of its
Subsidiaries, accompanied by instruments of transfer undated and endorsed in
blank; all other certificates, agreements or instruments necessary to perfect
the Collateral Agent’s security interest, for the benefit of the Secured
Parties, in all Pledged Collateral (as defined in the Security Agreement), in
each case, with the exception of those items permitted to be delivered after the
Closing Date pursuant to the terms of the Security Agreement;

(ii) UCC financing statements in appropriate form for filing under the UCC,
filings with the United States Patent and Trademark Office and United States
Copyright Office and such other documents under applicable Requirements of Law
in each jurisdiction as may be necessary or appropriate or, in the opinion of
the Collateral Agent, desirable to perfect the Liens created, or purported to be
created, by the Security Documents and with respect to all UCC financing
statements required to be filed pursuant to the Loan Documents;

(iii) copies of UCC, United States Patent and Trademark Office and United States
Copyright Office, tax and judgment lien searches, bankruptcy and pending lawsuit
searches or equivalent reports or searches, each of a recent date listing all
effective financing statements, lien notices or comparable documents that name
any Loan Party as debtor and that are filed in those state and county
jurisdictions in which any property of any Loan Party is located and the state
and county jurisdictions in which any Loan Party is organized or maintains its
principal place of business and such other searches that the Collateral Agent
deems necessary or appropriate, none of which encumber the Collateral covered or
intended to be covered by the Security Documents (other than Liens permitted
pursuant to Section 7.1 or any other Liens acceptable to the Collateral Agent);
and

(iv) evidence acceptable to the Collateral Agent of payment or arrangements for
payment by the Loan Parties of all applicable recording taxes, fees, charges,
costs and expenses required for the recording of the Security Documents.

(i) Insurance. The Administrative Agent shall have received a copy of, or a
certificate as to coverage under, the insurance policies required by Section 6.5
and the applicable provisions of the Security Documents, each of which shall
name the Collateral Agent, on behalf of the Secured Parties, as additional
insured, in form and substance satisfactory to the Administrative Agent.

(j) USA Patriot Act. The Lenders shall have received, sufficiently in advance of
the Closing Date, all documentation and other information required by bank
regulatory authorities under applicable “know your customer” and anti-money
laundering rules and regulations, including without limitation, the Patriot Act,
including, without limitation, the information described in Section 11.17.

 

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(k) HIPAA. Each Group Member shall have entered into a Business Associate
Agreement (a “Business Associate Agreement”) defined under the privacy
regulations promulgated pursuant to HIPAA reasonably acceptable to the
Administrative Agent and the Collateral Agent that permits disclosure to the
Administrative Agent and the Collateral Agent of any protected health
information (as defined in HIPAA) that may be associated with the Collateral.

5.2 Conditions to All Credit Extensions. The obligation of each Lender and each
Issuing Lender to make any Credit Extension (including the initial Credit
Extension) shall be subject to, and to the satisfaction of, each of the
conditions precedent set forth below.

(a) Notice. The Administrative Agent shall have received a notice as required by
Section 2.2 or 2.5 if Loans are being requested or, in the case of the issuance,
amendment, extension or renewal of a Letter of Credit, the Issuing Lender and
the Administrative Agent shall have received an Application or notice as
required by Section 3.2 or, in the case of a Swingline Loan, the Swingline
Lender and the Administrative Agent shall have received a notice as required by
Section 2.7.

(b) No Default. At the time of and immediately after giving effect to such
Credit Extension and the application of the proceeds thereof, no Default shall
have occurred and be continuing on such date.

(c) Representations and Warranties. Each of the representations and warranties
made by any Loan Party set forth in Section 4 or in any other Loan Document
shall be true and correct in all material respects (except that any
representation and warranty that is qualified as to “materiality” or “Material
Adverse Effect” shall be true and correct in all respects) on and as of the date
of such Credit Extension with the same effect as though made on and as of such
date, except to the extent such representations and warranties expressly relate
to an earlier date.

(d) In the case of an Alternative Currency Revolving Loan, there shall not have
occurred any change in national or international financial, political or
economic conditions or currency exchange rates or exchange controls which in the
reasonable opinion of the Administrative Agent or the Required Lenders (in the
case of any Loans to be denominated in an Alternative Currency) would make it
impracticable for such extension of credit to be denominated in the relevant
Alternative Currency.

Each notice of borrowing or an Application and the acceptance by the Borrower of
the proceeds of such Credit Extension shall constitute a representation and
warranty by the Borrower and each other Loan Party that on the date of such
Credit Extension (both immediately before and after giving effect to such Credit
Extension and the application of the proceeds thereof) the conditions contained
in Sections 5.2(b) and (c) have been satisfied. The Borrower shall provide such
information including calculations in reasonable detail of the covenants in
Section 7.16 as the Administrative Agent may reasonably request to confirm that
the conditions in Sections 5.2(b) and (c) have been satisfied.

SECTION 6

AFFIRMATIVE COVENANTS

Each Loan Party warrants, covenants and agrees with each Lender that, so long as
this Agreement shall remain in effect and until the Commitments have been
terminated and the principal of and interest on each Loan, all fees and all
other expenses or amounts payable under any Loan Document shall have been paid
in full and all Letters of Credit have been canceled or have expired and all
amounts drawn thereunder have been reimbursed in full or have been cash
collateralized at 100% of the face amount thereof, unless the Required Lenders
shall otherwise consent in writing, each Loan Party will, and will cause each of
its Subsidiaries to:

6.1 Reporting Requirements. The Borrower will furnish to the Administrative
Agent (for distribution to the Agents and Lenders):

(a) Default Notice. As soon as possible and in any event within five days after
the Borrower knows of the occurrence of a Default or any event, development or
occurrence reasonably likely to have a Material Adverse Effect continuing on the
date of such statement, a statement of the chief financial officer of the
Borrower setting forth details of such Default or other event, development or
occurrence and the action that the Borrower has taken and proposes to take with
respect thereto.

 

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(b) Annual Financials. As soon as available and in any event within 90 days
after the end of each Fiscal Year (or such earlier date on which Borrower is
required to file Form 10-K under the Exchange Act), a copy of the annual audit
report for such year for the Borrower and its Subsidiaries, including therein
Consolidated and consolidating balance sheets of the Borrower and its
Subsidiaries as of the end of such Fiscal Year and a Consolidated and
consolidating statements of income and a Consolidated statement of cash flows of
the Borrower and its Subsidiaries for such Fiscal Year, in each case accompanied
by an unqualified opinion of KPMG LLP or other independent public accountants of
recognized national standing, together with (i) a certificate of such accounting
firm to the Lenders stating that in the course of the regular audit of the
business of the Borrower and its Subsidiaries, which audit was conducted by such
accounting firm in accordance with generally accepted auditing standards, such
accounting firm has obtained no knowledge that a Default has occurred and is
continuing, or if, in the opinion of such accounting firm, a Default has
occurred and is continuing, a statement as to the nature thereof, (ii) a
Compliance Certificate and (iii) a certificate of the Chief Financial Officer of
the Borrower stating that to the best of such officer’s knowledge, no Default
has occurred and is continuing or, if a Default has occurred and is continuing,
a statement as to the nature thereof and the action that the Borrower has taken
and proposes to take with respect thereto.

(c) Quarterly Financials. As soon as available and in any event within 45 days
(or such earlier date on which the Borrower is required to file form 10-Q under
the Exchange Act) after the end of each of the first three Fiscal Quarters of
each Fiscal Year, Consolidated and consolidating balance sheets of the Borrower
and its Subsidiaries as of the end of such quarter and Consolidated and
consolidating statements of income for the period commencing at the end of the
previous Fiscal Quarter and ending with the end of such Fiscal Quarter and
Consolidated and consolidating statements of income and a Consolidated statement
of cash flows of the Borrower and its Subsidiaries for the period commencing at
the end of the previous Fiscal Year and ending with the end of such Fiscal
Quarter, setting forth in each case in comparative form the corresponding
figures for the corresponding date or period of the preceding Fiscal Year, all
in reasonable detail and duly certified (subject to normal year-end audit
adjustments) by the chief financial officer of the Borrower as having been
prepared in accordance with generally accepted accounting principles (except
that such financial statements may not contain all required notes and may be
subject to year end audit adjustments) and having been subject to a SAS 100 or
equivalent review by KPMG LLP or other independent public accountants of
recognized national standing, together with (i) a certificate of said officer
stating that to the best of such officer’s knowledge, no Default has occurred
and is continuing or, if a Default has occurred and is continuing, a statement
as to the nature thereof and the action that the Borrower has taken and proposes
to take with respect thereto and (ii) a Compliance Certificate.

 

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(d) Annual Forecasts. As soon as available and in any event no later than 90
days after the end of each Fiscal Year, forecasts prepared by management of the
Borrower, in form satisfactory to the Administrative Agent, of Consolidated
balance sheets, income statements and cash flow statements of the Borrower and
its Subsidiaries on a quarterly basis for the Fiscal Year following such Fiscal
Year and on an annual basis for each Fiscal Year thereafter through the year of
the Revolving Termination Date.

(e) Litigation. Promptly after the commencement thereof, notice of all actions,
suits, investigations, litigation and proceedings by on behalf of or before any
Governmental Authority or arbitrator affecting any Loan Party or any of its
Subsidiaries of the type described in Section 4.6, and include with such notice
a copy of any relevant citation, summons, subpoena, order to show cause or other
document.

(f) Securities Reports. Promptly after the sending or filing thereof, copies of
all proxy statements, financial statements and reports that any Loan Party or
any of its Subsidiaries sends to its stockholders, and copies of all regular,
periodic and special reports, and all registration statements, that any Loan
Party or any of its Subsidiaries files with the SEC or any governmental
authority that may be substituted therefor, or with any national securities
exchange.

(g) ERISA.

(i) ERISA Events and ERISA Reports. (A) Promptly and in any event within 10 days
after any Loan Party or any ERISA Affiliate knows or has reason to know that any
ERISA Event has occurred, a statement of the chief financial officer of the
Borrower describing such ERISA Event and the action, if any, that such Loan
Party or such ERISA Affiliate has taken and proposes to take with respect
thereto and (B) on the date any records, documents or other information must be
furnished to the PBGC with respect to any Plan pursuant to Section 4010 of
ERISA, a copy of such records, documents and information.

(ii) Plan Terminations. Promptly and in any event within two Business Days after
receipt thereof by any Loan Party or any ERISA Affiliate, copies of each notice
from the PBGC stating its intention to terminate any Plan or to have a trustee
appointed to administer any Plan.

(iii) Plan Annual Reports. Promptly and in any event within 30 days after the
filing thereof with the Internal Revenue Service, copies of each Schedule B
(Actuarial Information) to the annual report (Form 5500 Series) with respect to
each Plan.

(iv) Multiemployer Plan Notices. Promptly and in any event within five Business
Days after receipt thereof by any Loan Party or any ERISA Affiliate from the
sponsor of a Multiemployer Plan, copies of each notice concerning (A) the
imposition of Withdrawal Liability by any such Multiemployer Plan, (B) the
reorganization or termination, within the meaning of Title IV of ERISA, of any
such Multiemployer Plan or (C) the amount of liability incurred, or that may be
incurred, by such Loan Party or any ERISA Affiliate in connection with any event
described in clause (A) or (B).

(h) Environmental Conditions. Promptly after the assertion or occurrence
thereof, notice of any Environmental Action against or of any noncompliance by
any Loan Party or any of its Subsidiaries with any Environmental Law or
Environmental Permit that could reasonably be expected to have a Material
Adverse Effect.

 

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(i) Financial Officer’s Certificate Regarding Collateral. Concurrently with any
delivery of financial statements under Section 6.1(b), a certificate of the
chief financial officer setting forth the information required pursuant to the
Perfection Certificate Supplement or confirming that there has been no change in
such information since the date of the Perfection Certificate or latest
Perfection Certificate Supplement.

(j) Regulatory Notice. Promptly provide notice that any Loan Party knows or has
reason to know (A) that Dialysis Facilities have lost their qualification to
participate in Government Reimbursement Programs as would have a Material
Adverse Effect, (B) of an investigation described in Section 4.17(a) or (C) of
any violation described in Section 4.17(b) that would have a Material Adverse
Effect.

(k) Other Information. Such other information respecting the business, financial
condition, operations or properties of any Loan Party or any of its Subsidiaries
as any Agent or any Lender, through the Administrative Agent, may from time to
time reasonably request.

Documents required to be delivered pursuant to Section 6.1(b) or (c) (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; or (ii) on which such
documents are posted on the Borrower’s behalf on an Internet or intranet website
or www.sec.gov, if any, to which each Lender and the Administrative Agent have
access (whether a commercial, third-party website or whether sponsored by the
Administrative Agent); provided that: (A) the Borrower shall deliver paper
copies of such documents to the Administrative Agent upon its reasonable request
until a written notice to cease delivering paper copies is given by the
Administrative Agent, (B) the Borrower shall notify the Administrative Agent (by
telecopier or electronic mail) of the posting of any such documents and upon its
reasonable request, provide to the Administrative Agent by electronic mail
electronic versions (i.e., soft copies) of such documents and (iii) the Lenders
shall be deemed to have received such information on the date such information
is posted on the applicable website pursuant to clause (i) or (ii) above. The
Administrative Agent shall have no obligation to request the delivery of or
maintain paper copies of the documents referred to above, and each Lender shall
be solely responsible for timely accessing posted documents and maintaining its
copies of such documents.

6.2 Compliance with Laws, Etc. Comply, and cause each of its Subsidiaries to
comply, in all material respects, with all applicable Requirements of Law, such
compliance to include, without limitation, compliance with ERISA, the Racketeer
Influenced and Corrupt Organizations Chapter of the Organized Crime Control Act
of 1970 and all applicable laws and regulations under the federal Social
Security Act and all other applicable federal and state healthcare laws, except
to the extent that non-compliance could not be reasonably expected, individually
or in the aggregate, to result in a Material Adverse Effect, compliance with the
Patriot Act and all other laws and regulations relating to money-laundering and
terrorist activities.

6.3 Payment of Taxes, Etc.

(a) Pay and discharge, and cause each of its Subsidiaries to pay and discharge,
before the same shall become delinquent, (i) all Taxes imposed upon it or upon
its property and (ii) all lawful claims that, if unpaid, might by law become a
Lien upon its property; provided, however, that neither the Borrower nor any of
its Subsidiaries shall be required to pay or discharge any such Tax, assessment,
charge or claim (A) the non-payment or non-discharge of which could not be
reasonably expected, individually or in the aggregate, to result in a Material
Adverse Effect or (B) that is being contested in good faith and (in the case of
clause (a)(i)) by proper proceedings and as to which appropriate reserves are
being

 

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maintained in accordance with GAAP, unless and until any Lien resulting
therefrom attaches to its property and becomes enforceable against its other
creditors and subjects the property to a substantial risk of forfeiture.

(b) File or cause to be filed all material tax returns required to be filed by
it by the due dates (including any proper extensions) therefor.

6.4 Compliance with Environmental Laws. Except as could not reasonably be
expected to result in a Material Adverse Effect, comply, and cause each of its
Subsidiaries and all lessees and other Persons operating or occupying its
properties to comply, with all applicable Environmental Laws and Environmental
Permits; obtain and renew and cause each of its Subsidiaries to obtain and renew
all Environmental Permits necessary for its operations and properties that are
the legal responsibility of the Borrower or such Subsidiary; and conduct, and
cause each of its Subsidiaries to conduct, any investigation, study, sampling
and testing, and undertake any cleanup, removal, remedial or other action
required under Environmental Laws to address the presence, or Release or
threatened Release of Hazardous Materials at, on, under or from any of its
properties, in accordance with the requirements of all applicable Environmental
Laws; provided, however, that neither the Borrower nor any of its Subsidiaries
shall be required to undertake any such cleanup, removal, remedial or other
action to the extent that its obligation to do so is being contested in good
faith and by proper proceedings and appropriate reserves are being maintained in
accordance with GAAP requirements with respect to such circumstances.

6.5 Insurance.

(a) Generally. Keep its insurable property adequately insured at all times by
financially sound and reputable insurers; maintain such other insurance, to such
extent and against such risks as is customary with companies in the same or
similar businesses operating in the same or similar locations, including
insurance with respect to Mortgaged Properties and other properties material to
the business of the Group Members against such casualties and contingencies and
of such types and in such amounts with such deductibles as is customary in the
case of similar businesses operating in the same or similar locations; provided
that with respect to physical hazard insurance, neither the Collateral Agent nor
the applicable Group Member shall agree to the adjustment of any claim
thereunder in excess of $250,000 without the consent of the other (such consent
not to be unreasonably withheld or delayed); provided, further, that no consent
of any Group Member shall be required during an Event of Default.

(b) Requirements of Insurance. All such insurance shall (i) provide that no
cancellation, material reduction in amount or material change in coverage
thereof shall be effective until at least 30 days after receipt by the
Collateral Agent of written notice thereof, (ii) name the Collateral Agent as
mortgagee (in the case of property insurance) or additional insured on behalf of
the Secured Parties (in the case of liability insurance) or additional loss
payee (in the case of property insurance), as applicable and (iii) if reasonably
requested by the Collateral Agent, include a breach of warranty clause.

(c) Flood Insurance. With respect to each Mortgaged Property, obtain flood
insurance in such total amount as the Administrative Agent or the Required
Lenders may from time to time require, if at any time the area in which any
improvements are located on any Mortgaged Property is designated a “flood hazard
area” in any Flood Insurance Rate Map published by the Federal Emergency
Management Agency (or any successor agency), and otherwise comply with the
National Flood Insurance Program as set forth in the Flood Disaster Protection
Act of 1973, as amended from time to time.

(d) Broker’s Report. Deliver to the Administrative Agent and the Collateral
Agent and the Lenders a report of a reputable insurance broker with respect to
such insurance and such supplemental reports with respect thereto as the
Administrative Agent or the Collateral Agent may from time to time reasonably
request.

 

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(e) Mortgaged Properties. No Loan Party that is an owner of Mortgaged Property
shall take any action that is reasonably likely to be the basis for termination,
revocation or denial of any insurance coverage required to be maintained under
such Loan Party’s respective Mortgage or that could be the basis for a defense
to any claim under any Insurance Policy maintained in respect of the Premises,
and each Loan Party shall otherwise comply in all material respects with all
Insurance Requirements in respect of the Premises; provided, however, that each
Loan Party may, at its own expense and after written notice to the
Administrative Agent, (i) contest the applicability or enforceability of any
such Insurance Requirements by appropriate legal proceedings, the prosecution of
which does not constitute a basis for cancellation or revocation of any
insurance coverage required under this Section 6.5 or (ii) cause the Insurance
Policy containing any such Insurance Requirement to be replaced by a new policy
complying with the provisions of this Section 6.5.

6.6 Preservation of Corporate Existence, Etc. Preserve and maintain, and cause
each of its Subsidiaries to preserve and maintain, its existence, legal
structure, legal name, rights (charter and statutory) and material franchises
except, in each case, as otherwise permitted by Section 7.4.

6.7 Visitation Rights. At any reasonable time and from time to time, and, unless
a Default shall have occurred and be continuing, not more than two times during
any calendar year and upon reasonable notice, permit any of the Agents or any of
the Lenders, or any agents or representatives thereof, to examine and make
copies of and abstracts from the records and books of account of, and visit the
properties of, the Borrower and any of its Subsidiaries, and to discuss the
affairs, finances and accounts of the Borrower and any of its Subsidiaries with
any of their officers or directors and with their independent certified public
accountants (provided that representatives of the Borrower shall be entitled to
notice of and to participate in any such discussion).

6.8 Keeping of Books. Keep, and cause each of its Subsidiaries to keep, proper
books of record and account, in which full and correct entries shall be made of
all financial transactions sufficient to permit the preparation of financial
statements based thereon in accordance with GAAP.

6.9 Maintenance of Properties, Etc. Maintain and preserve, and cause each of its
Subsidiaries to maintain and preserve, absent events or circumstances leading to
a Recovery Event, all of its properties that are material in the conduct of its
business in good working order and condition, ordinary wear and tear excepted.

6.10 Transactions with Affiliates. Conduct, and cause each of its Subsidiaries
to conduct, all transactions otherwise permitted under the Loan Documents with
any of their Affiliates on terms that are fair and reasonable and no less
favorable to the Borrower or such Subsidiary than it would obtain in a
comparable arm’s-length transaction with a Person not an Affiliate (it being
understood that the Transactions are deemed to be on such terms) except
(a) transactions between or among the Borrower and its Subsidiaries, (b) any
transaction permitted by Section 7.7 and (c) notional pooling cash management
arrangements in the ordinary course of business.

6.11 Use of Proceeds. Use the proceeds of the Loans only for the purposes set
forth in Section 4.19.

 

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6.12 Additional Collateral; Additional Guarantors.

(a) Subject to this Section 6.12, with respect to any property acquired after
the Closing Date by any Loan Party that is intended to be subject to the Lien
created by any of the Security Documents but is not so subject, within 15
Business Days following the end of the Fiscal Quarter in which such acquisition
occurs (i) execute and deliver to the Administrative Agent and the Collateral
Agent such amendments or supplements to the relevant Security Documents or such
other documents as the Administrative Agent or the Collateral Agent shall deem
necessary or advisable to grant to the Collateral Agent, for its benefit and for
the benefit of the other Secured Parties, a Lien on such property subject to no
Liens other than Liens permitted pursuant to Section 7.1, and (ii) take all
actions necessary to cause such Lien to be duly perfected to the extent required
by such Security Document in accordance with all applicable Requirements of Law,
including the filing of financing statements in such jurisdictions as may be
reasonably requested by the Administrative Agent. The Borrower shall otherwise
take such actions and execute and/or deliver to the Collateral Agent such
documents as the Administrative Agent or the Collateral Agent shall require to
confirm the validity, perfection and priority of the Lien of the Security
Documents on such after-acquired properties.

(b) With respect to any Person that is or becomes a Subsidiary after the Closing
Date, within 15 Business Days following the end of the Fiscal Quarter in which
such Person becomes a Subsidiary (i) deliver to the Collateral Agent the
certificates, if any, representing all of the Capital Stock of such Subsidiary,
together with undated stock powers or other appropriate instruments of transfer
executed and delivered in blank by a duly authorized officer of the holder(s) of
such Capital Stock, and all intercompany notes owing from such Subsidiary to any
Loan Party together with instruments of transfer executed and delivered in blank
by a duly authorized officer of such Loan Party and (ii) cause such new
Subsidiary (A) to execute a Joinder Agreement or such comparable documentation
to become a Guarantor and a joinder agreement to the applicable Security
Agreement, substantially in the form annexed thereto or, in the case of a
Foreign Subsidiary, execute a security agreement compatible with the laws of
such Foreign Subsidiary’s jurisdiction in form and substance reasonably
satisfactory to the Administrative Agent, (B) to execute a Business Associate
Agreement and (C) to take all actions necessary or advisable in the opinion of
the Administrative Agent or the Collateral Agent to cause the Lien created by
the applicable Security Agreement to be duly perfected to the extent required by
such agreement in accordance with all applicable Requirements of Law, including
the filing of financing statements in such jurisdictions as may be reasonably
requested by the Administrative Agent or the Collateral Agent. Notwithstanding
the foregoing, (x) (1) the Capital Stock required to be delivered to the
Collateral Agent pursuant to clause (i) of this Section 6.12(b) shall not
include any Capital Stock of a Foreign Subsidiary created or acquired after the
Closing Date and (2) no Foreign Subsidiary shall be required to take the actions
specified in sub-clauses (A) and (C) of clause (ii) of this Section 6.12(b);
provided that this exception shall not apply to (A) Voting Interests of any
Subsidiary which is a first-tier controlled foreign corporation (as defined in
Section 957(a) of the Code) representing 65% of the total voting power of all
outstanding Voting Interests of such Subsidiary and (B) 100% of the Capital
Stock not constituting Voting Interests of any such Subsidiary, except that any
such Capital Stock constituting “stock entitled to vote” within the meaning of
Treasury Regulation Section 1.956-2(c)(2) shall be treated as Voting Interests
for purposes of this Section 6.12(b) and (y) no Subsidiary of the Borrower will
be required to become a Guarantor and to comply with this Section 6.12(b) if the
Loan Parties would be in compliance with Section 7.12 notwithstanding such
Subsidiary’s failure (and the failure of any other Subsidiaries) to comply with
this Section 6.12(b). Notwithstanding the foregoing and notwithstanding
Section 7.12, if any Subsidiary that is not a Guarantor is a guarantor of or
shall guarantee Debt of a Loan Party or Debt of a Loan Party is or shall
otherwise become a Contingent Obligation of any Subsidiary that is not a
Guarantor, such Subsidiary shall become a Guarantor hereunder and comply with
Section 6.12 and Section 6.13 and all other applicable provisions hereof.

 

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(c) Other than with respect to the Denver Headquarters, promptly grant to the
Collateral Agent, within 15 Business Days of the end of the Fiscal Quarter in
which the acquisition thereof occurred, a security interest in and Mortgage on
each Real Property owned in fee by such Loan Party as is acquired by such Loan
Party after the Closing Date and that, together with any improvements thereon,
individually has a fair market value of at least $10.0 million as additional
security for the Secured Obligations (unless the subject property is already
mortgaged to a third party to the extent permitted by Section 7.1). Such
Mortgages shall be granted pursuant to documentation reasonably satisfactory in
form and substance to the Administrative Agent and the Collateral Agent and
shall constitute valid and enforceable perfected Liens subject only to Liens
permitted by Section 7.1, or other Liens acceptable to the Collateral Agent. The
Mortgages or instruments related thereto shall be duly recorded or filed in such
manner and in such places as are required by law to establish, perfect, preserve
and protect the Liens in favor of the Collateral Agent required to be granted
pursuant to the Mortgages and all taxes, fees and other charges payable in
connection therewith shall be paid in full. Such Loan Party shall otherwise take
such actions and execute and/or deliver to the Collateral Agent such documents
as the Administrative Agent or the Collateral Agent shall require to confirm the
validity, perfection and priority of the Lien of any existing Mortgage or new
Mortgage against such after-acquired Real Property (including a title insurance
policy, a Survey, a life of loan flood hazard determination (together with a
notice regarding the special flood hazard area status and flood disaster
assistance with respect to such after-acquired Real Property executed by the
Borrower) and a local counsel opinion (each in form and substance reasonably
satisfactory to the Administrative Agent and the Collateral Agent) in respect of
such Mortgage).

6.13 Security Interests; Further Assurances. Promptly, upon the reasonable
request of the Administrative Agent, the Collateral Agent or any Lender, at the
Borrower’s expense, execute, acknowledge and deliver, or cause the execution,
acknowledgment and delivery of, and thereafter register, file or record, or
cause to be registered, filed or recorded, in an appropriate governmental
office, any document or instrument supplemental to or confirmatory of the
Security Documents or otherwise deemed by the Administrative Agent or the
Collateral Agent reasonably necessary or desirable for the continued validity,
perfection and priority of the Liens on the Collateral covered thereby subject
to no other Liens except as permitted by the applicable Security Document, or
obtain any consents or waivers as may be necessary or appropriate in connection
therewith. Deliver or cause to be delivered to the Administrative Agent and the
Collateral Agent from time to time such other documentation, consents,
authorizations, approvals and orders in form and substance reasonably
satisfactory to the Administrative Agent and the Collateral Agent as the
Administrative Agent and the Collateral Agent shall reasonably deem necessary to
perfect or maintain the Liens on the Collateral pursuant to the Security
Documents. Upon the exercise by the Administrative Agent, the Collateral Agent
or any Lender of any power, right, privilege or remedy pursuant to any Loan
Document which requires any consent, approval, registration, qualification or
authorization of any Governmental Authority execute and deliver all
applications, certifications, instruments and other documents and papers that
the Administrative Agent, the Collateral Agent or such Lender may reasonably
require. If the Administrative Agent, the Collateral Agent or the Required
Lenders determine that they are required by a Requirement of Law to have
appraisals prepared in respect of the Real Property of any Loan Party
constituting Collateral, Borrower shall provide to the Administrative Agent
appraisals that satisfy the applicable requirements of the Real Estate Appraisal
Reform Amendments of FIRREA and are otherwise in form and substance satisfactory
to the Administrative Agent and the Collateral Agent.

6.14 Information Regarding Collateral. Not effect any change (i) in any Loan
Party’s legal name, (ii) in the location of any Loan Party’s chief executive
office, (iii) in any Loan Party’s identity or organizational structure, (iv) in
any Loan Party’s Federal Taxpayer Identification Number or organizational
identification number, if any, or (v) in any Loan Party’s jurisdiction of
organization (in each case, including by merging with or into any other entity,
reorganizing, dissolving, liquidating, reorganizing or

 

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organizing in any other jurisdiction), until (A) it shall have given the
Collateral Agent and the Administrative Agent not less than 30 days’ prior
written notice, or such lesser notice period agreed to by the Collateral Agent
(it being understood that with respect to changes solely due to transactions
permitted by Section 7.4(a) or (b) notice may be delivered promptly after such
change), of its intention so to do, clearly describing such change and providing
such other information in connection therewith as the Collateral Agent or the
Administrative Agent may reasonably request and (B) (other than with respect to
changes solely due to transactions permitted by Section 7.4(a) or (b)) it shall
have taken all action reasonably satisfactory to the Collateral Agent to
maintain the perfection and priority of the security interest of the Collateral
Agent for the benefit of the Secured Parties in the Collateral, if applicable.
Each Loan Party agrees to promptly provide the Collateral Agent with certified
Constitutive Documents reflecting any of the changes described in the preceding
sentence. Each Loan Party also agrees to promptly notify the Collateral Agent of
any change in the location of any office in which it maintains books or records
relating to Collateral owned by it or any office or facility at which Collateral
is located (including the establishment of any such new office or facility),
other than changes in location of Mortgaged Property.

6.15 Ratings. Use commercially reasonable efforts to cause (x) S&P and Moody’s
to continue to issue ratings for the Facilities, (y) Moody’s to continue to
issue a corporate family rating (or the equivalent thereof) and (z) S&P to
continue to issue a corporate credit rating (or the equivalent thereof) (it
being understood, in each case, that such obligation shall not require the
Borrower to maintain a specific rating).

SECTION 7

NEGATIVE COVENANTS

Each Loan Party covenants and agrees with each Lender that, so long as this
Agreement shall remain in effect and until the Commitments have been terminated
and the principal of and interest on each Loan, all fees and all other expenses
or amounts payable under any Loan Document have been paid in full and all
Letters of Credit have been canceled or have expired and all amounts drawn
thereunder have been reimbursed in full or have been cash collateralized at 100%
of the face amount thereof, unless the Required Lenders shall otherwise consent
in writing, no Loan Party will, nor will they cause or permit any Subsidiaries
to:

7.1 Liens, Etc. Create, incur, assume or suffer to exist, or permit any of its
Subsidiaries to create, incur, assume or suffer to exist, any Lien on or with
respect to any of its properties of any character whether now owned or hereafter
acquired or assign, or permit any of its Subsidiaries to assign, any accounts or
other right to receive income, except:

(a) Liens created under the Loan Documents;

(b) Permitted Liens;

(c) Liens existing on the Closing Date and described on Schedule 7.1(c) hereto;

(d) Liens upon or in an asset acquired or held by the Borrower or any of its
Subsidiaries to secure the purchase price of such property or equipment or to
secure Debt incurred solely for the purpose of financing the acquisition,
construction or improvement of any such asset to be subject to such Liens, or
Liens existing on any such property or equipment at the time of acquisition
(other than any such Liens created in contemplation of such acquisition that do
not secure the purchase price), or extensions, renewals or replacements of any
of the foregoing; provided, however, that (i) such Liens shall be created not
more than 180 days after the date of acquisition or

 

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completion of construction or improvement and (ii) no such Lien shall extend to
or cover any asset other than the asset being acquired, constructed or improved
and any attachments thereto and proceeds thereof, and no such extension, renewal
or replacement shall extend to or cover any asset not theretofore subject to the
Lien being extended, renewed or replaced; provided further that the aggregate
principal amount of the Debt secured by Liens permitted by this clause (d) shall
not exceed the amount permitted under Section 7.2(e) at any time outstanding;

(e) Liens arising in connection with Capitalized Leases permitted under
Section 7.2(f); provided that no such Lien shall extend to or cover any assets
other than the assets subject to such Capitalized Leases;

(f) Liens arising in connection with Debt permitted under Section 7.2(l);
provided that no such Lien shall extend to or cover any assets other than the
assets of the relevant borrowing entity;

(g) the replacement, extension or renewal of any Lien permitted by clause
(c) above upon or in the same property theretofore subject thereto or the
replacement, extension or renewal (without increase in the amount (except by an
amount equal to accrued and unpaid interest and premium thereon plus fees,
original issue discount and expenses incurred in connection with such
replacement, extension or renewal) or change in any direct or contingent
obligor) of the Debt secured thereby;

(h) Liens on assets of the Borrower or any of its Subsidiaries arising in
connection with Sale and Leaseback Transactions permitted under Section 7.5(h);

(i) Liens on assets that are the subject of, or are customarily subject to Liens
relating to, Permitted Receivables Financings;

(j) Liens existing on property at the time of its acquisition or existing on the
property of any Person at the time such Person becomes a Subsidiary of the
Borrower, in each case after the Closing Date; provided that (A) such Lien was
not created in contemplation of such acquisition or such Person becoming a
Subsidiary of the Borrower, (B) such Lien does not extend to or cover any other
assets or property (other than the proceeds or products thereof and other than
after-acquired property to the extent included in the grant of such Lien), and
(C) the Debt secured thereby is permitted under Section 7.2(p);

(k) customary Liens and setoff rights securing obligations in respect of
notional pooling cash management arrangements in the ordinary course of
business; and

(l) other Liens not otherwise permitted by the foregoing clauses of this
Section 7.1 securing an aggregate principal amount at any time outstanding not
to exceed $75,000,000.

7.2 Debt. Create, incur, assume or suffer to exist, or permit any of its
Subsidiaries to create, incur, assume or suffer to exist, any Debt, except:

(a) Debt under the Loan Documents;

(b) (i) the Senior Notes and the Senior Notes Guarantees and any Permitted
Refinancing thereof; provided that the aggregate principal amount of all such
Debt at any one time outstanding pursuant to this Section 7.2(b)(i) shall not
exceed $1,550,000,000 and (ii) Debt existing on the Closing Date and described
on Schedule 7.2(b) hereto and any Permitted Refinancing thereof;

 

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(c) Debt of the Borrower in respect of Swap Agreements (A) existing on the
Closing Date and described in Schedule 7.2(b) hereto or (B) entered into from
time to time after the Closing Date with counterparties that are Lenders at the
time such Swap Agreement is entered into (or Affiliates of such Lender at such
time); provided that, in all cases under this clause (c), all such Swap
Agreements shall not be speculative in nature (including, without limitation,
with respect to the term and purpose thereof);

(d) Debt of (A) the Borrower owing to any Subsidiary, and (B) any of the
Subsidiaries owing to the Borrower or any other Subsidiary; provided that with
respect to any loan or advance by a Loan Party, (i) any such Debt shall be
evidenced by an Intercompany Note and pledged by such Loan Party as Collateral
pursuant to the Security Documents and (ii) if such loan or advance is to a
Non-Guarantor Subsidiary, such loan or advance is permitted by Section 7.6;

(e) Debt incurred after the Closing Date and secured by Liens expressly
permitted under Section 7.1(d) and any Permitted Refinancing thereof; provided
that the aggregate principal amount of all such Debt at any one time outstanding
pursuant to this Section 7.2(e), when aggregated with the principal amount of
all Debt outstanding at such time under Section 7.2(f), shall not exceed the
greater of $250,000,000 or 7.5% of the Consolidated Tangible Assets of the
Borrower and its Subsidiaries;

(f) Capitalized Leases incurred after the Closing Date and any Permitted
Refinancing thereof; provided that the aggregate principal amount of all such
Debt at any one time outstanding pursuant to this Section 7.2(f), when
aggregated with the principal amount of all Debt outstanding at such time under
Section 7.2(e), shall not exceed the greater of $250,000,000 or 7.5% of the
Consolidated Tangible Assets of the Borrower and its Subsidiaries;

(g) Contingent Obligations of (A) the Borrower guaranteeing any obligations of
any Subsidiary and (B) any Subsidiary of the Borrower guaranteeing any
obligations of the Borrower or any other Subsidiary; provided that each such
primary obligation is not otherwise prohibited under the terms of the Loan
Documents; and provided, further, that any guaranty of obligations of any
Non-Guarantor Subsidiary by a Loan Party is permitted by Section 7.6;

(h) (i) (A) Debt not to exceed $100,000,000 and (B) Specified Debt that is not
secured by any Lien on the assets of the Borrower or any Subsidiary; provided
that under each of clauses (i)(A) and (i)(B), (x) on a Pro Forma Basis as of the
last day of the most recent period prior to the incurrence of such Debt in
respect of which financial statements shall have been required to be delivered
pursuant to Section 6.1(b) or (c) (or if prior to the first time such financial
statements are so required to be delivered, as of the last day of the most
recent period in respect of which financial statements of the Borrower and its
Subsidiaries are available), the Leverage Ratio shall not exceed the ratio
specified in Section 7.16(a) for such last day (it being understood that if such
last day is prior to December 31, 2010, then the ratio specified for
December 31, 2010 under Section 7.16(a) shall be deemed to be the ratio
specified in Section 7.16(a) for such last day) and (y) the Borrower shall be in
compliance with Section 7.16(b) and (ii) any Permitted Refinancing thereof;

(i) endorsement of negotiable instruments for deposit or collection or similar
transactions in the ordinary course of business;

 

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(j) Debt comprised of indemnities given by the Borrower or any of its
Subsidiaries, or guarantees or other similar undertakings by the Borrower or any
of its Subsidiaries entered into in lieu thereof, in favor of the purchaser of
property and assets of the Borrower and its Subsidiaries being sold, leased,
transferred or otherwise disposed of in accordance with this Agreement and
covering liabilities incurred by the Borrower or its applicable Subsidiary in
respect of such property and assets prior to the date of consummation of the
sale, lease, transfer or other disposition thereof, which indemnities,
guarantees or undertakings are required under the terms of the documentation for
such sale, lease, transfer or other disposition;

(k) Debt comprised of liabilities or other obligations assumed or retained by
the Borrower or any of its Subsidiaries from Subsidiaries of the Borrower that
are, or all or substantially all of the property and assets of which are, sold,
leased, transferred or otherwise disposed of pursuant to Section 7.5(c) or (f);
provided that such liabilities or other obligations were not created or incurred
in contemplation of the related sale, lease, transfer or other disposition;

(l) (i) secured and unsecured Debt of Non-Guarantor Subsidiaries in an aggregate
amount not to exceed $300,000,000 at any time outstanding and (ii) secured and
unsecured Debt of Foreign Subsidiaries in an aggregate amount not to exceed
$150,000,000 at any time outstanding;

(m) Debt comprised of guarantees given by the Borrower or any of its
Subsidiaries in respect of any Special Purpose Licensed Entity which
obligations, when aggregated with the aggregate amount of all Investments made
under Section 7.6(i) hereof, shall not exceed $150,000,000 at any time
outstanding;

(n) Debt under Cash Management Agreements and similar arrangements in each case
in connection with cash management and deposit accounts in the ordinary course
of business or Debt under notional pooling cash management arrangements in the
ordinary course of business;

(o) Debt in connection with Permitted Receivables Financings;

(p) Debt of any Person that becomes a Subsidiary of the Borrower (or of any
Person not previously a Subsidiary of the Borrower that is merged or
consolidated with or into the Borrower or one of its Subsidiaries) after the
date hereof as a result of an Investment pursuant to Section 7.6(e) or (j) or
Debt of any Person that is assumed by the Borrower or any of its Subsidiaries in
connection with an acquisition of assets by the Borrower or such Subsidiary in
an Investment pursuant to Section 7.6(j), and any Permitted Refinancing thereof;
provided that (A) such Debt is not incurred in contemplation of such Investment
and (B) the aggregate amount of Debt pursuant to this clause (p) that is
(i) Debt of a Non-Guarantor Subsidiary or (ii) Debt that is secured by a Lien on
the assets of the Borrower or any of its Subsidiaries does not exceed
$200,000,000 at any time outstanding; and

(q) Debt incurred in the ordinary course of business with respect to performance
bonds, surety bonds, completion bonds, guaranty bonds, appeal bonds or customs
bonds, letters of credit, and other obligations of a similar nature required in
the ordinary course of business or in connection with the enforcement of rights
or claims of the Borrower or any of its Subsidiaries or in connection with
judgments that do not result in a Default or to secure obligations under
workers’ compensation laws, unemployment insurance or similar social security
legislation (other than in respect of employee benefit plans subject to ERISA),
public or statutory obligations or payment of customs duties in connection with
the importation of goods.

 

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7.3 Change in Nature of Business. Engage or permit any of its Subsidiaries to
engage in any business other than healthcare services and any businesses
incidental, complementary, ancillary or related thereto; provided that a Special
Purpose Receivables Subsidiary may engage in any Permitted Receivables
Financing.

7.4 Mergers, Etc. Merge into or consolidate with any Person or permit any Person
to merge into it, or permit any of its Subsidiaries to do so, except that:

(a) any of the Subsidiaries may merge into or consolidate with the Borrower;
provided that the Borrower is the surviving corporation;

(b) any Subsidiary of the Borrower may merge into or consolidate with any other
Subsidiary of the Borrower; provided that, in the case of any such merger or
consolidation involving a Wholly Owned Subsidiary, the Person formed by or
surviving such merger or consolidation shall be a Wholly Owned Subsidiary of the
Borrower; provided further that, in the case of any such merger or consolidation
to which a Guarantor is a party, the Person formed by such merger or
consolidation shall be a Guarantor;

(c) in connection with any purchase or other acquisition of Capital Stock of, or
property and assets of, any Person permitted under Section 7.6(e), the Borrower
may permit any other Person to merge into or consolidate with it (provided that
(i) the Borrower is the surviving entity or (ii) the surviving entity (x) is a
Domestic Person and (y) simultaneously with such merger or consolidation agrees
to be bound by the terms hereof and of the Loan Documents and assume the
Borrower’s obligations hereunder and thereunder pursuant to an agreement or
instrument satisfactory in form and substance to the Administrative Agent (and
shall thereafter be the Borrower hereunder), and any of the Subsidiaries of the
Borrower may merge into or consolidate with any other Person or permit any other
Person to merge into or consolidate with it; provided that the Person with which
such Subsidiary is merging or consolidating (i) shall be engaged in a business
permitted by Section 7.3, (ii) shall take all actions required under
Section 6.12 and (iii) shall be a Guarantor if the merging Subsidiary was a
Guarantor prior to such transaction; and

(d) in connection with any sale, transfer or other disposition of all or
substantially all of the Capital Stock of, or the property and assets of, any
Person permitted under Sections 7.5(c) or (f), any of the Subsidiaries of the
Borrower may merge into or consolidate with any other Person or permit any other
Person to merge into or consolidate with it;

provided, however, that in each case, immediately after giving effect thereto,
no event shall occur and be continuing that constitutes a Default.

7.5 Sales, Etc., of Assets. Sell, lease, transfer or otherwise dispose of, or
permit any of its Subsidiaries to sell (including sales and issuances of Capital
Stock of any Subsidiary (other than sales and issuances that do not decrease the
percentage ownership of the Borrower and its Subsidiaries in each class of
Capital Stock of such Subsidiary)), lease, transfer or otherwise dispose of, any
assets, or grant any option or other right to purchase, lease or otherwise
acquire any assets, except (provided that the issuance and sale of stock by the
Borrower shall not be subject to this Section 7.5):

(a) the Borrower and its Subsidiaries may sell inventory in the ordinary course
of business;

(b) (A) the Borrower may sell, lease, transfer or otherwise dispose of any of
its property or assets to any of the Subsidiaries, and (B) any of the
Subsidiaries may sell, lease, transfer

 

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or otherwise dispose of any of its property or assets to the Borrower or any of
the other Subsidiaries; provided that, in each case (other than in connection
with Intercompany Receivables), (x) if the transferor in such transaction is a
Domestic Subsidiary and the transferee in such transaction is a Domestic
Subsidiary, on a pro forma basis, the Borrower and its Subsidiaries would be in
compliance with Section 7.12 and Section 7.16 and (y) if the transferee in such
transaction is a Foreign Subsidiary, such transaction is permitted by
Section 7.6;

(c) any Subsidiary of the Borrower that is no longer actively engaged in any
business or activities and does not have property and assets with an aggregate
book value in excess of $1,000,000 may be wound up, liquidated or dissolved so
long as such winding up, liquidation or dissolution is determined in good faith
by management of the Borrower to be in the best interests of the Borrower and
its Subsidiaries;

(d) the Borrower and its Subsidiaries may sell, lease, transfer or otherwise
dispose of any obsolete, damaged or worn out equipment thereof or any other
equipment that is otherwise no longer useful in the conduct of their businesses;

(e) the Borrower and its Subsidiaries may lease or sublease Real Property to the
extent required for their respective businesses and operations in the ordinary
course so long as such lease or sublease is not otherwise prohibited under the
terms of the Loan Documents;

(f) the Borrower and its Subsidiaries may sell, lease, transfer or otherwise
dispose of property and assets not otherwise permitted to be sold, leased,
transferred or disposed of pursuant to this Section 7.5 so long as the aggregate
book value of all of the property and assets of the Borrower and its
Subsidiaries sold, leased, transferred or otherwise disposed of pursuant to this
clause (f) does not exceed $500,000,000 in the aggregate since the Closing Date;
provided that:

(A) the gross proceeds received from any such sale, lease, transfer or other
disposition shall be at least equal to the fair market value of the property and
assets so sold, leased, transferred or otherwise disposed of, determined at the
time of such sale, lease, transfer or other disposition;

(B) at least 75% of the value of the aggregate consideration received from any
such sale, lease, transfer or other disposition shall be in cash; provided that
(i) up to one-third of such 75% may consist of notes or other obligations
received by the Borrower or such Subsidiary that are due and payable or
otherwise converted by the Borrower or such Subsidiary into cash within 365 days
of receipt, which cash (to the extent received) shall constitute Net Cash
Proceeds attributable to the original transaction; (ii) any unsubordinated Debt
of the Borrower or any of its Subsidiaries (as shown on the Borrower’s or such
Subsidiary’s most recent balance sheet) that is assumed by the transferee of any
such assets shall constitute cash for purposes of this Section 7.5(f), so long
as the Borrower and all of its Subsidiaries are fully and unconditionally
released therefrom; and (iii) any Designated Non-Cash Consideration received by
the Borrower or any of its Subsidiaries, having an aggregate fair market value,
taken together with all other Designated Non-Cash Consideration received
pursuant to this clause (B) after the Closing Date not to exceed $100,000,000 at
the time of receipt of such Designated Non-Cash Consideration shall be deemed to
be cash for purposes of this Section 7.5(f) (it being understood that the fair
market value of each item of Designated Non-Cash Consideration is measured at
the time of receipt without giving effect to subsequent changes in value);
provided that if such Designated Non-Cash Consideration is sold for, or
otherwise converted into, cash, such cash shall constitute Net Cash Proceeds
attributable to the original Transaction;

 

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(C) immediately before and immediately after giving pro forma effect to any such
sale, lease, transfer or other disposition, no Default shall have occurred and
be continuing;

(D) with respect to any disposition under this subsection that exceeds
$50,000,000, within five Business Days prior to such disposition, and with
respect to any other disposition under this subsection, within 15 Business Days
after such disposition, the Borrower shall deliver to the Administrative Agent,
on behalf of the Lenders, a certificate identifying the property disposed of and
stating (a) that immediately before and after giving effect thereto, no Default
existed or will exist, (b) that the consideration received or to be received by
the Borrower or such Subsidiary for such property has been determined by the
Borrower or the applicable Subsidiary to be not less than the fair market value
of such property, (c) the total expected consideration to be paid in respect of
such disposition and (d) the expected Net Cash Proceeds resulting from such
disposition; and

(E) if and to the extent that the Net Cash Proceeds of any transaction effected
pursuant to this Section 7.5(f) shall not have been reinvested (pursuant to a
Reinvestment Notice), such Net Cash Proceeds shall be applied to prepay Loans to
the extent, and in accordance with, Section 2.11;

(g) the Borrower and its Subsidiaries may exchange assets and properties with
another Person; provided that:

(A) the assets or properties received by the Borrower or its Subsidiaries shall
be used in a business permitted by Section 7.3 as conducted immediately prior to
such transaction, or in an incidental or related business;

(B) the total consideration received by the Borrower or such Subsidiary for such
assets or property shall have been determined by the Borrower or such Subsidiary
to be not less than the fair market value of the assets or property exchanged;

(C) immediately before and immediately after giving pro forma effect to any such
exchange, no Default shall have occurred and be continuing;

(D) any cash received by the Borrower or any such Subsidiary in connection with
such exchange shall be treated as Net Cash Proceeds subject to Section 2.11 and
any cash paid by the Borrower or any Subsidiary in connection with such exchange
shall be treated as an acquisition expenditure under Section 7.6(e);

(E) with respect to any exchange under this subsection that involves assets
and/or property with a value in excess of $50,000,000, within five Business Days
prior to such exchange, and with respect to any other exchange under this
Section 7.5(g), within fifteen Business Days after such exchange, the Borrower
shall deliver to the Administrative Agent, on behalf of the Lenders, a
certificate identifying the assets or property disposed of and acquired in such
exchange, and stating (a) that immediately before and after giving effect
thereto, no Default existed or will exist, (b) that the total consideration
received by or expected to be received by the Borrower or such Subsidiary for
such assets or property has been determined by the Borrower or such Subsidiary
to be not less than the fair market value of the assets or property exchanged,
and (c) the amount, if any, of the expected cash to be paid or Net Cash Proceeds
to be received in connection with such exchange;

 

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(F) if Collateral is exchanged the assets and properties received in exchange
shall constitute Collateral and Sections 6.12 and 6.13 shall be complied with;

(h) the Borrower and its Subsidiaries may enter into Sale and Leaseback
Transactions (i) with respect to the Denver Headquarters and (ii) with respect
to any other property, provided that the aggregate value of property sold or
transferred under this subclause (ii) shall not exceed $150,000,000 since the
Closing Date; provided that the Net Cash Proceeds from such transaction are
applied in accordance with Section 2.11(b);

(i) the Borrower and its Subsidiaries may purchase, sell or otherwise transfer
(including by capital contribution) Receivables Assets pursuant to Permitted
Receivables Financings;

(j) the Borrower and its Subsidiaries may sell, lease, transfer or otherwise
dispose of assets or property (i) in anticipation of any Investment pursuant to
Section 7.6(e), (f), (h) or (k) (as a result of discussion with antitrust
regulators in connection with such Investment) or (ii) as required pursuant to
any consent decree or similar order or agreement, which decree, order or
agreement is issued or entered into prior to the consummation of such Investment
and in connection therewith by the Antitrust Division of the U.S. Department of
Justice, the Bureau of Competition of the U.S. Federal Trade Commission and/or
any similar state or foreign regulatory agency or body;

(k) within 180 days of the acquisition by the Borrower or any Subsidiary of any
Real Property after the Closing Date the Borrower or such Subsidiary may sell or
otherwise transfer such Real Property in connection with a Sale and Leaseback
Transaction so long as the Borrower shall be in compliance with Section 7.2
after giving effect to such Sale and Leaseback Transaction; provided that the
Net Cash Proceeds from such transaction are applied in accordance with
Section 2.11(b); and

(l) any Subsidiary of the Borrower may issue additional Capital Stock to
management or employees and physicians under contract with the Borrower or any
of its Subsidiaries in an amount not in excess of $15,000,000 in the aggregate
in any twelve month period.

7.6 Investments in Other Persons. Make or hold, or permit any of its
Subsidiaries to make or hold, any Investment in any Person, except:

(a) Investments by the Borrower and its Subsidiaries in Cash Equivalents;

(b) Investments existing on the Closing Date and described on Schedule 7.6
hereto;

(c) Investments by the Borrower in Swap Agreements permitted under
Section 7.2(c);

(d) Investments in accounts receivable in the ordinary course of business or
notes received in transactions permitted by Sections 7.5(f) and (j);

(e) the purchase or other acquisition of (1) Capital Stock of any Person that,
upon the consummation thereof, will be more than 50% owned by the Borrower or
one or more of its

 

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Wholly Owned Subsidiaries (including, without limitation, as a result of a
merger or consolidation) or (2) all or substantially all the property and assets
of a Person or consisting of a line of business or business unit of a Person;
provided that, with respect to each purchase or other acquisition made pursuant
to this clause (e):

(A) the lines of business of the Person to be (or the property and assets of
which are to be) so purchased or otherwise acquired shall be permitted by
Section 7.3;

(B) (1) immediately before and immediately after giving pro forma effect to any
such purchase or other acquisition, no Default shall have occurred and be
continuing and (2) immediately after giving effect to such purchase or other
acquisition, the Borrower and its Subsidiaries shall be in compliance on a Pro
Forma Basis with Section 7.12 and Section 7.16;

(C) the aggregate amount of consideration paid or provided by the Borrower and
its Subsidiaries after the Closing Date pursuant to this Section 7.6(e)(C)
(under clause (i) below) for the purchase or acquisition for Persons that will
be Foreign Subsidiaries, when taken together with any Investments made in
Foreign Subsidiaries pursuant to Section 7.6(h)(ii)(y)(A), shall not exceed
(i) $1,000,000,000 or (ii) if the Leverage Ratio for the most recent Measurement
Period is less than 3.50:1.00 (both before and after giving effect to such
transaction (including any use of cash with respect thereto) on a Pro Forma
Basis), consideration in an unlimited amount; provided that if the amount of all
such cash payments exceeds the limitation set forth in clause (i) of this clause
(C) during any period during which the Leverage Ratio test in clause (ii) of
this clause (C) is met, such excess cash payments shall not constitute an Event
of Default if such Leverage Ratio test is not met in any subsequent Measurement
Period;

(D) the Borrower shall have delivered to the Administrative Agent, on behalf of
the Lenders, at least three Business Days prior to the date on which any such
purchase or other acquisition in which the total cash consideration is more than
$50,000,000 is to be consummated, a certificate of a Responsible Officer, in
form and substance reasonably satisfactory to the Administrative Agent,
certifying that all of the requirements set forth in this clause (e) have been
satisfied or will be satisfied on or prior to the consummation of such purchase
or other acquisition and containing a copy of any existing financial statements
of the business to be acquired in the Borrower’s possession; and

(E) Sections 6.12 and 6.13 are complied with;

(f) Investments by the Borrower or any Subsidiary in 50% or less of the Capital
Stock of another Person (the “Minority Investment”); provided that (i) the
Borrower or any Subsidiary owns at least 20% (on a fully diluted basis) of the
issued and outstanding Capital Stock of such Person, (ii) the aggregate
outstanding amount of Minority Investments made by the Borrower and any
Subsidiary shall not exceed $250,000,000 at any one time outstanding, (iii) the
Borrower or any Subsidiary shall have full control over all bank accounts of
such Person if the Borrower or any Subsidiary is the largest holder of Capital
Stock of such Person, (iv) the Borrower or any Subsidiary shall control or act
as the managing general partner of such Person if such Person is a partnership
and if the Borrower or any Subsidiary is the largest holder of Capital Stock of
such Person, and (v) immediately before and after giving effect thereto, no
Default shall exist;

 

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(g) notes from employees issued to the Borrower representing payment for Capital
Stock of the Borrower or representing payment of the exercise price of options
to purchase Capital Stock of the Borrower, and employee relocation expenses
incurred in the ordinary course of business, in an aggregate amount at any time
outstanding not to exceed $15,000,000;

(h) Investments by (i) any Subsidiary of the Borrower in the Borrower and
(ii) the Borrower or any of its Subsidiaries in any Subsidiary of the Borrower;
provided that (x) no Investment in any Non-Guarantor Domestic Subsidiary shall
be made unless, after giving pro forma effect thereto, the Borrower and its
Subsidiaries shall be in compliance with Section 7.12 and Section 7.16 and
(y) no Investment in any Foreign Subsidiary shall be made unless the aggregate
amount of Investments by the Borrower and its Subsidiaries in Foreign
Subsidiaries after the Closing Date pursuant to this Section 7.6(h)(ii)(y)
(under clause (A) below), when taken together with any Investments made in
Foreign Subsidiaries pursuant to Section 7.6(e)(C)(i) shall not exceed
(A) $1,000,000,000 or (B) if the Leverage Ratio for the most recent Measurement
Period is less than 3.50:1.00 (both before and after giving effect to such
transaction (including any use of cash with respect thereto) on a Pro Forma
Basis), an unlimited amount; provided that if the amount of all such cash
payments exceeds the limitation set forth in clause (x) of this clause
(ii) during any period during which the Leverage Ratio test in clause (y)(B) of
this clause (ii) is met, such excess cash payments shall not constitute an Event
of Default if such Leverage Ratio test is not met in any subsequent Measurement
Period;

(i) Investments of the Borrower or any of its Subsidiaries in any Special
Purpose Licensed Entity which, when aggregated with the aggregate amount of all
obligations guaranteed under Section 7.2(m), shall not exceed $150,000,000 at
any time;

(j) Investments arising as a result of Permitted Receivables Financings; and

(k) Investments by the Borrower or any of its Subsidiaries (i) in an aggregate
amount outstanding not to exceed the sum of (x) $250,000,000 plus
(y) $500,000,000 minus the aggregate amount of purchases, redemptions,
acquisitions, dividends and distributions pursuant to Section 7.7(d)(i) and
payments, prepayments, redemptions or acquisitions of Debt pursuant to
Section 7.9(a)(ii)(x) since the Closing Date, in each case, other than with the
Available Amount plus (z) the Available Amount minus the aggregate amount of
purchases, redemptions, acquisitions, dividends and distributions pursuant to
Section 7.7(d)(i) and payments, prepayments, redemptions or acquisitions of Debt
pursuant to Section 7.9(a)(ii)(x) since the Closing Date to the extent made with
the Available Amount or (ii) if the Leverage Ratio for the most recent
Measurement Period is less than 3.50:1.00 (both before and after giving effect
to such transaction (including any use of cash with respect thereto) on a Pro
Forma Basis), in an unlimited amount; provided that if the amount of all such
Investments exceeds the limitation set forth in clause (i) of this Section
during any period during which the Leverage Ratio test in clause (ii) of this
Section is met, such excess Investments shall not constitute an Event of Default
if such Leverage Ratio test is not met in any subsequent Measurement Period;
provided, further, in the case of each transaction under this
Section 7.6(k)(ii), that immediately prior to each such transaction and after
giving effect thereto the aggregate amount of the Available Revolving Commitment
is not less than $75,000,000.

7.7 Restricted Payments. Declare or pay any dividends, purchase, redeem, retire,
defease or otherwise acquire for value any of its Capital Stock now or hereafter
outstanding, return any capital to its stockholders, partners or members (or the
equivalent Persons thereof) as such, make any distribution of assets, Capital
Stock, obligations or securities to its stockholders, partners or members (or
the equivalent Persons thereof) as such, or permit any of its Subsidiaries to do
any of the foregoing, or permit

 

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any of its Subsidiaries to purchase, redeem, retire, defease or otherwise
acquire for value any Capital Stock of the Borrower, except that, so long as no
Default shall have occurred and be continuing at the time of any action
described below or would result therefrom:

(a) the Borrower may (A) declare and pay dividends and distributions payable in
its common Capital Stock, (B) except to the extent the Net Cash Proceeds thereof
are required to be applied to the prepayment of the Loans pursuant to
Section 2.11, purchase, redeem, retire, defease or otherwise acquire Capital
Stock with the proceeds received contemporaneously from the issue of new Capital
Stock with equal or inferior voting powers, designations, preferences and
rights, and (C) repurchase its Capital Stock owned by management or employees
and physicians under contract with the Borrower or any of its Subsidiaries in an
amount not in excess of $10,000,000 in the aggregate in any twelve month period;

(b) any Subsidiary of the Borrower may (A) declare and pay cash dividends to the
Borrower, and (B) declare and pay cash dividends to any other Loan Party of
which it is a Subsidiary;

(c) any of the non-Wholly Owned Subsidiaries of the Borrower may declare and pay
or make dividends and other distributions to its shareholders, partners or
members (or the equivalent Persons thereof) generally so long as the Borrower
and each of the Subsidiaries that own any of the Capital Stock thereof receive
at least their respective proportionate shares of any such dividend or
distribution (based upon their relative holdings of the Capital Stock thereof
and taking into account the relative preferences, if any, of the various classes
of the Capital Stock thereof);

(d) so long as no Default is continuing or will be continuing after such
transaction, the Borrower may (A) purchase, redeem or otherwise acquire for
value any of its Capital Stock or (B) declare and pay dividends and
distributions payable in either (i) cash (in the aggregate for both clauses
(A) and (B)), when taken together with the aggregate amount of payments,
prepayments, redemptions or acquisitions of Debt pursuant to
Section 7.9(a)(ii)(x) and Investments pursuant to Section 7.6(k)(i)(y) not to
exceed $500,000,000, in each case other than with the Available Amount, plus the
Available Amount minus the aggregate amount of Investments made pursuant to
Section 7.6(k)(i)(y) and payments, prepayments, redemptions or acquisitions of
Debt pursuant to Section 7.9(a)(ii)(x) since the Closing Date to the extent made
with the Available Amount or (ii) if the Leverage Ratio for the most recent
Measurement Period is less than 3.50:1.00 (both before and after giving effect
to such transaction (including any use of cash with respect thereto) on a Pro
Forma Basis), cash in any amount; provided that if the amount of all such cash
payments exceeds the limitation set forth in clause (i) of this Section during
any period during which the Leverage Ratio test in clause (ii) of this Section
is met, such excess cash payments shall not constitute an Event of Default if
such Leverage Ratio test is not met in any subsequent Measurement Period;
provided further, in the case of each transaction under this Section 7.7(d),
that immediately prior to each such transaction and after giving effect thereto
the aggregate amount of the Available Revolving Commitment is not less than
$75,000,000; and

(e) the Borrower may consummate the Refinancing on the Closing Date and the
Stock Repurchase; provided that the Stock Repurchase is consummated no later
than the first anniversary of the Closing Date.

7.8 Accounting Changes. Make or permit any change in (i) accounting policies or
reporting practices, except as allowed by GAAP (or as otherwise provided
pursuant to Section 1.4), or (ii) Fiscal Year.

 

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7.9 Prepayments of Other Debt; Modifications of Constitutive Documents and Other
Documents, etc. Directly or indirectly:

(a) make (or give any notice in respect thereof) any voluntary or optional
payment or prepayment on or redemption or acquisition for value of, or any
prepayment or redemption as a result of any asset sale, change of control or
similar event of, any Debt outstanding under the Senior Notes, any Specified
Debt or any Subordinated Debt; except for (i) any Permitted Refinancing of the
Senior Notes, any Specified Debt or any Subordinated Debt and (ii) so long as no
Default is continuing or will be continuing after such transaction, the
voluntary or optional payment or prepayment or redemption or acquisition for
value of Senior Notes, Specified Debt or Subordinated Debt in an aggregate
amount for this clause (ii), when taken together with the aggregate amount of
purchases, redemptions, acquisitions, dividends and distributions pursuant to
Section 7.7(d)(i) and Investments pursuant to Section 7.6(k)(i)(y), (x) not to
exceed $500,000,000, in each case, other than with the Available Amount, plus
the Available Amount minus the aggregate amount of Investments made pursuant to
Section 7.6(k)(i)(y) and the aggregate amount of purchases, redemptions,
acquisitions, dividends and distributions pursuant to Section 7.7(d)(i) since
the Closing Date to the extent made with the Available Amount or (y) if the
Leverage Ratio for the most recent Measurement Period is less than 3.50:1.00
(both before and after giving effect to such transaction (including any use of
cash with respect thereto) on a Pro Forma Basis), cash in any amount; provided
that if the amount of all such cash payments exceeds the limitation set forth in
clause (ii)(x) of this Section during any period during which the Leverage Ratio
test in clause (ii)(y) of this Section is met, such excess cash payments shall
not constitute an Event of Default if such Leverage Ratio test is not met in any
subsequent Measurement Period; provided further, in the case of each transaction
under this Section 7.9(a)(ii), that immediately prior to each such transaction
and after giving effect thereto the aggregate amount of the Available Revolving
Commitment is not less than $75,000,000;

(b) amend or modify, or permit the amendment or modification of, any provision
of any Senior Notes Documents, and documents governing Specified Debt or any
Permitted Receivables Documents in any manner that is adverse in any material
respect to the interests of the Lenders;

(c) terminate, amend, modify or change any of its Constitutive Documents
(including by the filing or modification of any certificate of designation) or
any agreement to which it is a party with respect to its Capital Stock
(including any stockholders’ agreement), or enter into any new agreement with
respect to its Capital Stock, other than any such amendments, modifications or
changes or such new agreements which are not adverse in any material respect to
the interests of the Lenders; provided that the Loan Parties may issue such
Capital Stock, so long as such issuance is not prohibited by Section 7.13 or any
other provision of this Agreement, and may amend their Constitutive Documents to
authorize any such Capital Stock; or

(d) except as may be required to comply with any law, regulation or court or
administrative decision, terminate, amend or modify a Business Associate
Agreement without the consent of the parties thereto.

7.10 Negative Pledge. Enter into or suffer to exist, or permit any Loan Party to
enter into or suffer to exist, any agreement prohibiting or conditioning the
creation or assumption of any Lien upon any of its property or assets except
(i) in favor of the Secured Parties or (ii) in connection with (A) any Debt
permitted by Section 7.2(e) solely to the extent that the agreement or
instrument governing such Debt prohibits a Lien on the property acquired with
the proceeds of such Debt, or (B) any Capitalized

 

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Lease permitted by Section 7.2(f) solely to the extent that such Capitalized
Lease prohibits a Lien on the property subject thereto, or (C) any Debt
outstanding on the date any Subsidiary of the Borrower becomes such a Subsidiary
(so long as such agreement was not entered into solely in contemplation of such
Subsidiary becoming a Subsidiary of the Borrower), or (D) any Debt permitted by
Section 7.2(l) solely to the extent that the agreement or instrument governing
such Debt prohibits a Lien on the property of the relevant borrowing entity or
(E) the Senior Notes or (F) any Debt permitted by Section 7.2(o).

7.11 Payment Restrictions Affecting Subsidiaries. Directly or indirectly, enter
into or suffer to exist, or permit any of its Subsidiaries to enter into or
suffer to exist, any agreement or arrangement limiting the ability of any of its
Subsidiaries to declare or pay dividends or other distributions in respect of
its Capital Stock or repay or prepay any Debt owed to, make loans or advances
to, or otherwise transfer assets to or invest in, the Borrower or any Subsidiary
of the Borrower (whether through a covenant restricting dividends, loans, asset
transfers or investments, a financial covenant or otherwise), except (i) the
Loan Documents; (ii) any agreement in effect at the time such Subsidiary becomes
a Subsidiary of the Borrower, so long as such agreement was not entered into
solely in contemplation of such Person becoming a Subsidiary of the Borrower;
(iii) restrictions on transfer contained in Debt incurred pursuant to Sections
7.2(e) and (f); provided that such restrictions relate only to the transfer of
the property financed with such Debt; (iv) in connection with and pursuant to
any Permitted Refinancing, replacements of restrictions that are not more
restrictive than those being replaced and do not apply to any other Person or
assets than those that would have been covered by the restrictions in the Debt
so refinanced; (v) restrictions contained in any Permitted Receivables Document
with respect to any Special Purpose Receivables Subsidiary; (vi) solely with
respect to Subsidiaries that are not Guarantors, restrictions under the
Constitutive Documents governing such Subsidiary: (A) with respect to existing
Subsidiaries, existing on the Closing Date; and (B) with respect to Subsidiaries
created or acquired after the Closing Date: (1) prohibiting such Subsidiary from
guaranteeing Debt of the Borrower or another Subsidiary; (2) restricting
dividend payments and other distributions solely to permit pro rata dividends
and other distributions in respect of any Capital Stock of such Subsidiary;
(3) limiting transactions with the Borrower or another Subsidiary to those with
terms that are fair and reasonable to such Subsidiary and no less favorable to
such Subsidiary than could have been obtained in an arm’s length transaction
with an unrelated third party; and (4) limiting such Subsidiary’s ability to
transfer assets or incur Debt without the consent of the holders of the Capital
Stock of such Subsidiary; provided that all restrictions permitted by this
clause (vi) shall no longer be permitted in the event any such Subsidiary
becomes a Guarantor; (vii) restrictions contained in Debt incurred pursuant to
Section 7.2(l) with respect to the borrowers thereunder; and (viii) encumbrances
or restrictions (A) that restrict in a customary manner the subletting,
assignment or transfer of any property or asset that is subject to a lease,
license or similar contract entered into in the ordinary course of business, or
the assignment or transfer of any lease, license or contract entered into in the
ordinary course of business and (B) arising by virtue of any transfer of,
agreement to transfer, option or right with respect to, or Lien on, any property
or assets of the Borrower or any Subsidiary.

7.12 Non-Guarantor Domestic Subsidiaries. Permit at any time the aggregate
Consolidated Tangible Assets (calculated without duplication) at such time of
all Non-Guarantor Domestic Subsidiaries (whether or not any such Subsidiary is
existing on the Closing Date but not including any Special Purpose Receivables
Subsidiary) to exceed 29% of the Consolidated Tangible Assets of the Borrower
and its Domestic Subsidiaries (excluding any Special Purpose Receivables
Subsidiary).

7.13 Issuance of Additional Stock. Permit any of its Subsidiaries to issue any
additional Capital Stock, except, subject to Section 6.12, as follows:

(i) in connection with a permitted Investment or to employees or consultants in
the ordinary course of business;

 

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(ii) the Borrower and any Subsidiary thereof may organize new Subsidiaries and
any Subsidiary may issue additional Capital Stock to (x) any Loan Party, (y) any
Non-Guarantor Domestic Subsidiary, if on a pro forma basis, the Borrower and its
Subsidiaries would be in compliance with Section 7.12 and Section 7.16 and
(z) any Foreign Subsidiary in a transaction permitted by Sections 7.6(e), (f),
(h) or (k); or

(iii) subject to compliance with the provisions this Agreement, including
Section 7.6, Section 7.12 and Section 7.16, any Subsidiary of the Borrower may
(i) issue additional Capital Stock or (ii) sell outstanding Capital Stock
thereof, in each case to any Subsidiary of the Borrower or any Persons other
than Affiliates of the Borrower or its Subsidiaries (it being understood that
any such sales and issuances that decrease the percentage ownership of the
Borrower or any of its Subsidiaries in any class of Capital Stock of such
Subsidiary shall be subject to Section 7.5).

7.14 Anti-Terrorism Law; Anti-Money Laundering.

(a) Directly or indirectly, (i) knowingly conduct any business or engage in
making or receiving any contribution of funds, goods or services to or for the
benefit of any Person described in Section 4.23, (ii) knowingly deal in, or
otherwise engage in any transaction relating to, any property or interests in
property blocked pursuant to the Executive Order or any other Anti-Terrorism
Law, or (iii) knowingly engage in or conspire to engage in any transaction that
evades or avoids, or has the purpose of evading or avoiding, or attempts to
violate, any of the prohibitions set forth in any Anti-Terrorism Law (and the
Loan Parties shall deliver to the Lenders any certification or other evidence
requested from time to time by any Lender in its reasonable discretion,
confirming the Loan Parties’ compliance with this Section 7.14).

(b) Cause or permit any of the funds of such Loan Party that are used to repay
the Loans to be derived from any unlawful activity with the result that the
making of the Loans would be in violation of any Requirement of Law.

7.15 Embargoed Person. Knowingly cause or permit (a) any of the funds or
properties of the Loan Parties that are used to repay the Loans to constitute
property of, or be beneficially owned directly or indirectly by, any Person
subject to sanctions or trade restrictions under United States law (“Embargoed
Person” or “Embargoed Persons”) that is identified on (1) the “List of Specially
Designated Nationals and Blocked Persons” maintained by OFAC and/or on any other
similar list maintained by OFAC pursuant to any authorizing statute including,
but not limited to, the International Emergency Economic Powers Act, 50 U.S.C.
§§ 1701 et seq., The Trading with the Enemy Act, 50 U.S.C. App. 1 et seq., and
any Executive Order or Requirement of Law promulgated thereunder, with the
result that the investment in the Loan Parties (whether directly or indirectly)
is prohibited by a Requirement of Law, or the Loans made by the Lenders would be
in violation of a Requirement of Law, or (2) the Executive Order, any related
enabling legislation or any other similar Executive Orders or (b) any Embargoed
Person to have any direct or indirect interest, of any nature whatsoever in the
Loan Parties, with the result that the investment in the Loan Parties (whether
directly or indirectly) is prohibited by a Requirement of Law or the Loans are
in violation of a Requirement of Law.

 

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7.16 Financial Covenants.

(a) Maximum Leverage Ratio. Permit the Leverage Ratio, measured as of the end of
any Measurement Period ending during any period set forth in the set forth in
the table below, to exceed the ratio set forth opposite such period in the table
below:

 

Test Period

   Leverage Ratio

December 31, 2010 - December 31, 2012

   4.25 to 1.00

March 31, 2013 - December 31, 2013

   4.00 to 1.00

March 31, 2014 and thereafter

   3.75 to 1.00

(b) Minimum Consolidated Interest Coverage Ratio. Permit the Consolidated
Interest Coverage Ratio, measured as of the end of any Measurement Period to be
less than 3.00 to 1.00.

(c) Limitation on Capital Expenditures. Permit the aggregate amount of Capital
Expenditures made in any period set forth below, to exceed the amount set forth
opposite such period below:

 

Period

   Amount (in millions)

January 1, 2011 - December 31, 2011

   $200

Each Fiscal Year after 2011

   Prior Fiscal Year times
110%

; provided, however, that (x) if the aggregate amount of Capital Expenditures
made in any Fiscal Year shall be less than the maximum amount of Capital
Expenditures permitted under this Section 7.16(c) for such Fiscal Year, then an
amount of such shortfall not exceeding 50% of such maximum amount may be added
to the amount of Capital Expenditures permitted under this Section 7.16(c) for
the immediately succeeding (but not any other) Fiscal Year and (y) in
determining whether any amount is available for carryover, the amount expended
in any Fiscal Year shall first be deemed to be from the amount carried forward
from the prior Fiscal Year.

SECTION 8

EVENTS OF DEFAULT

8.1 Events of Default. If any of the following events (“Events of Default”)
shall occur:

(a) the Borrower shall fail to pay any principal of any Loan or any
reimbursement obligation in respect of any LC Disbursement when and as the same
shall become due and payable, whether at the due date thereof or at a date fixed
for prepayment thereof or otherwise;

(b) the Borrower shall fail to pay any interest on any Loan or any fee or any
other amount (other than an amount referred to in paragraph (a) of this Section)
payable under this Agreement when and as the same shall become due and payable,
and such failure shall continue unremedied for a period of three Business Days;

(c) any representation or warranty made or deemed made by or on behalf of any
Group Member in or in connection with this Agreement or any amendment or
modification hereof or waiver hereunder, or in any report, certificate,
financial statement or other document furnished pursuant to or in connection
with this Agreement or any amendment or modification hereof or waiver hereunder,
shall prove to have been incorrect when in any material respect made or deemed
made;

 

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(d) any Loan Party shall fail to observe or perform any covenant, condition or
agreement contained in Sections 6.1, 6.6 (with respect to the Borrower’s
existence), 6.10 or 6.11 or in Section 7;

(e) any Loan Party shall fail to observe or perform any covenant, condition or
agreement contained in any Loan Document (other than those specified in
paragraph (a), (b) or (d) of this Section), and such failure shall continue
unremedied for a period of 30 days after notice thereof from the Administrative
Agent to the Borrower (which notice will be given at the request of any Lender);

(f) any Group Member shall (i) default in making any payment of any principal of
any Debt (including any Contingent Obligation, but excluding the Loans) on the
scheduled or original due date with respect thereto; or (ii) default in making
any payment of any interest on any such Debt beyond the period of grace, if any,
provided in the instrument or agreement under which such Debt was created; or
(iii) default in the observance or performance of any other agreement or
condition relating to any such Debt 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 beneficiary of such Debt (or a trustee or
agent on behalf of such holder or beneficiary) to cause, with the giving of
notice if required, such Debt to become due prior to its stated maturity or (in
the case of any such Debt constituting a Contingent Obligation) to become
payable; provided that a default, event or condition described in clause (i),
(ii) or (iii) of this paragraph (f) shall not at any time constitute an Event of
Default unless, at such time, one or more defaults, events or conditions of the
type described in clauses (i), (ii) and (iii) of this paragraph (f) shall have
occurred and be continuing with respect to Debt the outstanding principal amount
of which exceeds in the aggregate $50,000,000;

(g) (i) the Borrower or any Material Subsidiary shall commence any case,
proceeding or other action (A) under any existing or future law of any
jurisdiction, domestic or foreign, relating to bankruptcy, insolvency,
reorganization or relief of debtors, seeking to have an order for relief entered
with respect to it, or seeking to adjudicate it a bankrupt or insolvent, or
seeking reorganization, arrangement, adjustment, winding-up, liquidation,
dissolution, composition or other relief with respect to it or its debts, or
(B) seeking appointment of a receiver, trustee, custodian, conservator or other
similar official for it or for all or any substantial part of its assets, or the
Borrower or any Material Subsidiary shall make a general assignment for the
benefit of its creditors; or (ii) there shall be commenced against the Borrower
or any Material Subsidiary any case, proceeding or other action of a nature
referred to in clause (i) above that (A) results in the entry of an order for
relief or any such adjudication or appointment or (B) remains undismissed,
undischarged or unbonded for a period of 60 days; or (iii) there shall be
commenced against the Borrower or any Material Subsidiary any case, proceeding
or other action seeking issuance of a warrant of attachment, execution,
distraint or similar process against all or any substantial part of its assets
that results in the entry of an order for any such relief that shall not have
been vacated, discharged, or stayed or bonded pending appeal within 60 days from
the entry thereof; or (iv) the Borrower or any Material Subsidiary shall take
any action in furtherance of, or indicating its consent to, approval of, or
acquiescence in, any of the acts set forth in clause (i), (ii), or (iii) above;
or (v) the Borrower or any Material Subsidiary shall generally not, or shall be
unable to, or shall admit in writing its inability to, pay its debts as they
become due;

(h) an ERISA Event shall have occurred that, when taken together with all other
ERISA Events that have occurred, has resulted or could reasonably be expected to
result in liabilities of the Loan Parties in an aggregate amount exceeding
$50,000,000 or in the imposition of a Lien or security interest on any assets of
a Loan Party;

 

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(i) (A) one or more judgments or decrees shall be entered against any Group
Member involving in the aggregate a liability (not paid or fully covered by
insurance as to which the relevant insurance company has acknowledged coverage)
of $50,000,000 or more, and such judgments or decrees are not paid, discharged
or stayed for a period of 30 consecutive days, or any action shall be legally
taken by a judgment creditor to attach or levy upon any assets of any Group
Member to enforce any such judgment or (B) any Group Member shall enter into any
settlement of a claim (including claims by Governmental Authorities for
violations or alleged violations of Requirements of Law) which settlements,
individually or in the aggregate, amount to $50,000,000 or more and any Group
Member fails to make any payment required to be made thereunder or any action
shall be legally taken by a creditor to attach or levy upon any assets of any
Group Member to enforce any such settlement;

(j) any of the Security Documents shall cease, for any reason, to be in full
force and effect, or any Loan Party or any Affiliate of any Loan Party shall so
assert, or any Lien created by any of the Security Documents shall cease to be
enforceable and of the same effect and priority purported to be created thereby,
except, in the case of any such cessation that is attributable to an event of a
type contemplated by Section 8.1(g), this provision shall apply only to the
Borrower or a Material Subsidiary;

(k) the guarantee pursuant to Section 10 of any Guarantor shall cease, for any
reason, to be in full force and effect or any Loan Party or any Affiliate of any
Loan Party shall so assert, except, in the case of any such cessation that is
attributable to an event of a type contemplated by Section 8.1(g), this
provision shall apply only to the Borrower or a Material Subsidiary;

(l) a Change of Control shall occur;

(m) the Borrower or any Subsidiary, in each case to the extent it is engaged in
the business of providing services for which Medicare or Medicaid reimbursement
is sought, shall for any reason, including, without limitation, as the result of
any finding, designation or decertification, lose its right or authorization, or
otherwise fail to be eligible, to participate in Medicaid or Medicare programs
or to accept assignments or rights to reimbursements under Medicaid regulations
or Medicare regulations, or the Borrower or any Subsidiary has, for any reason,
had its right to receive reimbursements under Medicaid or Medicare regulations
suspended, and such loss, failure or suspension (together with all such other
losses, failures and suspensions continuing at such time) shall have resulted in
(x) a Material Adverse Effect or (y) Consolidated net operating revenues for the
immediately preceding four Fiscal Quarter period of the Borrower constituting
less than 95% of Consolidated net operating revenues for any preceding four
Fiscal Quarter period of the Borrower; or

(n) the Borrower or any Subsidiary of the Borrower shall for any reason
terminate a Business Associate Agreement between such entity and the Collateral
Agent;

then, and in every such event (other than an event with respect to the Borrower
described in paragraph (g) of this Section), and at any time thereafter during
the continuance of such event, the Administrative Agent may with the consent of
the Required Lenders, and at the request of the Required Lenders shall, by
notice to the Borrower, take either or both of the following actions, at the
same or different times: (i) terminate the Commitments, and thereupon the
Commitments shall terminate immediately, and (ii) declare the Loans then
outstanding to be due and payable in whole (or in part, in which case any
principal not so declared

 

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to be due and payable may thereafter be declared to be due and payable), and
thereupon the principal of the Loans so declared to be due and payable, together
with accrued interest thereon and all fees and other obligations of the Borrower
accrued hereunder, shall become due and payable immediately, without
presentment, demand, protest or other notice of any kind, all of which are
hereby waived by the Borrower; and in case of any event with respect to the
Borrower described in paragraph (g) of this Section, the Commitments shall
automatically terminate and the principal of the Loans then outstanding,
together with accrued interest thereon and all fees and other obligations of the
Borrower accrued hereunder, shall automatically become due and payable, without
presentment, demand, protest or other notice of any kind, all of which are
hereby waived by the Borrower.

8.2 Application of Proceeds. The proceeds received by the Collateral Agent in
respect of any sale of, collection from or other realization upon all or any
part of the Collateral pursuant to the exercise by the Collateral Agent of its
remedies shall be applied, in full or in part, together with any other sums then
held by the Collateral Agent pursuant to this Agreement, promptly by the
Collateral Agent as follows:

(a) First, to the payment of all reasonable costs and expenses, fees,
commissions and taxes of such sale, collection or other realization including
compensation to the Collateral Agent and its agents and counsel, and all
expenses, liabilities and advances made or incurred by the Collateral Agent in
connection therewith and all amounts for which the Collateral Agent is entitled
to indemnification pursuant to the provisions of any Loan Document, together
with interest on each such amount at the highest rate then in effect under this
Agreement from and after the date such amount is due, owing or unpaid until paid
in full;

(b) Second, to the payment of all other reasonable costs and expenses of such
sale, collection or other realization including compensation to the other
Secured Parties and their agents and counsel and all costs, liabilities and
advances made or incurred by the other Secured Parties in connection therewith,
together with interest on each such amount at the highest rate then in effect
under this Agreement from and after the date such amount is due, owing or unpaid
until paid in full;

(c) Third, without duplication of amounts applied pursuant to clauses (a) and
(b) above, to the indefeasible payment in full in cash, pro rata, of interest,
premium and other amounts constituting Obligations (other than principal and
Reimbursement Obligations), any fees, premiums and scheduled periodic payments
due under Specified Swap Agreements constituting Secured Obligations and any
interest accrued thereon and any fees and interest due under any Secured Cash
Management Agreements constituting Secured Obligations (provided if more than
$25,000,000 of Debt is outstanding under Cash Management Agreements that would
be Secured Cash Management Agreements but for the dollar limitation contained in
the definition of “Secured Cash Management Agreement,” each Cash Management Bank
shall be deemed to be holding Secured Obligations on a pro rata basis when taken
together with the amount of Debt under all Cash Management Agreements held by
Cash Management Banks) , in each case equally and ratably in accordance with the
respective amounts thereof then due and owing;

(d) Fourth, to the indefeasible payment in full in cash, pro rata, of the
principal amount of the Obligations (including Reimbursement Obligations) and
any breakage, termination or other payments under Specified Swap Agreements
constituting Secured Obligations and any interest accrued thereon and the
principal amount owing under Secured Cash Management Agreements constituting
Secured Obligations (provided if more than $25,000,000 of Debt is outstanding
under Cash Management Agreements that would be Secured Cash Management

 

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Agreements but for the dollar limitation contained in the definition of “Secured
Cash Management Agreement,” each Cash Management Bank shall be deemed to be
holding Secured Obligations on a pro rata basis when taken together with the
amount of Debt under all Cash Management Agreements held by Cash Management
Banks); and

(e) Fifth, the balance, if any, to the Person lawfully entitled thereto
(including the applicable Loan Party or its successors or assigns) or as a court
of competent jurisdiction may direct.

In the event that any such proceeds are insufficient to pay in full the items
described in clauses (a) through (e) of this Section 8.2, the Loan Parties shall
remain liable, jointly and severally, for any deficiency.

SECTION 9

THE AGENTS

9.1 Appointment and Authority. Each of the Lenders and the Issuing Lender hereby
irrevocably appoints JPMorgan Chase Bank, N.A. to act on its behalf as the
Administrative Agent and the Collateral Agent hereunder and under the other Loan
Documents and authorizes such Agents to take such actions on its behalf and to
exercise such powers as are delegated to such Agents by the terms hereof and
thereof, together with such actions and powers as are reasonably incidental
thereto. With the exception of the second and fifth sentences of Section 9.6,
the provisions of this Section are solely for the benefit of the Administrative
Agent, the Collateral Agent, the Lenders and the Issuing Lender, and neither the
Borrower nor any other Loan Party shall have rights as a third party beneficiary
of any of such provisions.

9.2 Rights as a Lender. Each Person serving as an Agent hereunder shall have the
same rights and powers in its capacity as a Lender as any other Lender and may
exercise the same as though it were not an Agent and the term “Lender” or
“Lenders” shall, unless otherwise expressly indicated or unless the context
otherwise requires, include each Person serving as an Agent hereunder in its
individual capacity. Such Person and its Affiliates may accept deposits from,
lend money to, act as the financial advisor or in any other advisory capacity
for and generally engage in any kind of business with the Borrower or any
Subsidiary or other Affiliate thereof as if such Person were not an Agent
hereunder and without any duty to account therefor to the Lenders.

9.3 Exculpatory Provisions. No Agent shall have any duties or obligations except
those expressly set forth herein and in the other Loan Documents. Without
limiting the generality of the foregoing, no Agent:

(i) shall be subject to any fiduciary or other implied duties, regardless of
whether a Default has occurred and is continuing;

(ii) shall have any duty to take any discretionary action or exercise any
discretionary powers, except discretionary rights and powers expressly
contemplated hereby or by the other Loan Documents that such Agent is required
to exercise as directed in writing by the Required Lenders (or such other number
or percentage of the Lenders as shall be expressly provided for herein or in the
other Loan Documents); provided that such Agent shall not be required to take
any action that, in its judgment or the judgment of its counsel, may expose such
Agent to liability or that is contrary to any Loan Document or applicable
Requirements of Law; and

 

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(iii) shall, except as expressly set forth herein and in the other Loan
Documents, have any duty to disclose, and shall not be liable for the failure to
disclose, any information relating to Borrower or any of its Affiliates that is
communicated to or obtained by the Person serving as such Agent or any of its
Affiliates in any capacity.

No Agent shall be liable for any action taken or not taken by it (x) with the
consent or at the request of the Required Lenders (or such other number or
percentage of the Lenders as shall be necessary, or as such Agent shall believe
in good faith shall be necessary, under the circumstances as provided in
Section 11.1) or (y) in the absence of its own gross negligence or willful
misconduct. No Agent shall be deemed to have knowledge of any Default unless and
until notice describing such Default is given to such Agent by the Borrower, a
Lender or the Issuing Lender.

No Agent shall be responsible for or have any duty to ascertain or inquire into
(i) any statement, warranty or representation made in or in connection with this
Agreement or any other Loan Document, (ii) the contents of any certificate,
report or other document delivered hereunder or thereunder or in connection
herewith or therewith, (iii) the performance or observance of any of the
covenants, agreements or other terms or conditions set forth herein or therein
or the occurrence of any Default, (iv) the validity, enforceability,
effectiveness or genuineness of this Agreement, any other Loan Document or any
other agreement, instrument or document or (v) the satisfaction of any condition
set forth in Section 5 or elsewhere herein, other than to confirm receipt of
items expressly required to be delivered to such Agent. Without limiting the
generality of the foregoing, the use of the term “agent” in this Agreement with
reference to the Administrative Agent or the Collateral Agent is not intended to
connote any fiduciary or other implied (or express) obligations arising under
agency doctrine of any applicable law. Instead, such term is used merely as a
matter of market custom and is intended to create or reflect only an
administrative relationship between independent contracting parties.

9.4 Reliance by Agent. Each Agent shall be entitled to rely upon, and shall not
incur any liability for relying upon, any notice, request, certificate, consent,
statement, instrument, document or other writing (including any electronic
message, Internet or intranet website posting or other distribution) believed by
it to be genuine and to have been signed, sent or otherwise authenticated by the
proper Person. Each Agent also may rely upon any statement made to it orally or
by telephone and believed by it to have been made by the proper Person, and
shall not incur any liability for relying thereon. In determining compliance
with any condition hereunder to the making of a Loan, or the issuance of a
Letter of Credit, that by its terms must be fulfilled to the satisfaction of a
Lender or the Issuing Lender, the Administrative Agent may presume that such
condition is satisfactory to such Lender or the Issuing Lender unless the
Administrative Agent shall have received notice to the contrary from such Lender
or the Issuing Lender prior to the making of such Loan or the issuance of such
Letter of Credit. Each Agent may consult with legal counsel (who may be counsel
for the Borrower), independent accountants and other experts selected by it, and
shall not be liable for any action taken or not taken by it in accordance with
the advice of any such counsel, accountants or experts.

9.5 Delegation of Duties. Each Agent may perform any and all of its duties and
exercise its rights and powers hereunder or under any other Loan Document by or
through any one or more sub-agents appointed by such Agent. Each Agent and any
such sub-agent may perform any and all of its duties and exercise its rights and
powers by or through their respective Related Parties. The exculpatory
provisions of this Section shall apply to any such sub-agent and to the Related
Parties of each Agent and any such sub-agent, and shall apply to their
respective activities in connection with the syndication of the credit
facilities provided for herein as well as activities as Agent.

 

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9.6 Resignation of Agent. Each Agent may at any time give notice of its
resignation to the Lenders, the Issuing Lender and the Borrower. Upon receipt of
any such notice of resignation, the Required Lenders shall have the right, in
consultation with the Borrower, to appoint a successor, which shall be a bank
with an office in the United States, or an Affiliate of any such bank with an
office in the United States. If no such successor shall have been so appointed
by the Required Lenders and shall have accepted such appointment within 30 days
after the retiring Agent gives notice of its resignation, then the retiring
Agent may on behalf of the Lenders and the Issuing Lender, appoint a successor
Agent meeting the qualifications set forth above; provided that if the Agent
shall notify the Borrower and the Lenders that no qualifying Person has accepted
such appointment, then such resignation shall nonetheless become effective in
accordance with such notice and (1) the retiring Agent shall be discharged from
its duties and obligations hereunder and under the other Loan Documents (except
that in the case of any collateral security held by the Collateral Agent on
behalf of the Lenders or the Issuing Lender under any of the Loan Documents, the
retiring Collateral Agent shall continue to hold such collateral security as
nominee until such time as a successor Collateral Agent is appointed) and
(2) all payments, communications and determinations provided to be made by, to
or through an Agent shall instead be made by or to each Lender and the Issuing
Lender directly, until such time as the Required Lenders appoint a successor
Agent as provided for above in this paragraph. Upon the acceptance of a
successor’s appointment as Agent hereunder, such successor shall succeed to and
become vested with all of the rights, powers, privileges and duties of the
retiring (or retired) Agent, and the retiring Agent shall be discharged from all
of its duties and obligations hereunder or under the other Loan Documents (if
not already discharged therefrom as provided above in this paragraph). The fees
payable by the Borrower to a successor Agent shall be the same as those payable
to its predecessor unless otherwise agreed between the Borrower and such
successor. After the retiring Agent’s resignation hereunder and under the other
Loan Documents, the provisions of this Section 9 and Section 11.5 shall continue
in effect for the benefit of such retiring Agent, its sub-agents and their
respective Related Parties in respect of any actions taken or omitted to be
taken by any of them while the retiring Agent was acting as Agent.

9.7 Non-Reliance on Agent and Other Lenders. Each Lender and the Issuing Lender
acknowledges that it has, independently and without reliance upon any Agent or
any other Lender and based on such documents and information as it has deemed
appropriate, made its own credit analysis and decision to enter into this
Agreement. Each Lender and the Issuing Lender also acknowledges that it will,
independently and without reliance upon any Agent or any other Lender and based
on such documents and information as it shall from time to time deem
appropriate, continue to make its own decisions in taking or not taking action
under or based upon this Agreement, any other Loan Document or any related
agreement or any document furnished hereunder or thereunder.

9.8 No Other Duties, etc. Anything herein to the contrary notwithstanding, none
of the bookmanagers, arrangers, Syndication Agent or Documentation Agents listed
on the cover page hereof shall have any powers, duties or responsibilities under
this Agreement or any of the other Loan Documents, except in its capacity, as
applicable, as the Administrative Agent, the Collateral Agent, a Lender or the
Issuing Lender hereunder.

SECTION 10

GUARANTEE

10.1 The Guarantee. The Guarantors hereby jointly and severally guarantee, as a
primary obligor and not as a surety to each Secured Party and their respective
successors and assigns, the prompt payment in full when due (whether at stated
maturity, by required prepayment, declaration, demand, by acceleration or
otherwise) of the principal of and interest (including any interest, fees, costs
or

 

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charges that would accrue but for the provisions of the Title 11 of the United
States Code after any bankruptcy or insolvency petition under Title 11 of the
United States Code) on the Loans made by the Lenders to, and the Notes held by
each Lender of, Borrower, and all other Secured Obligations from time to time
owing to the Secured Parties by any Loan Party under any Loan Document,
Specified Swap Agreement or Secured Cash Management Agreement, in each case
strictly in accordance with the terms thereof (such obligations being herein
collectively called the “Guaranteed Obligations”). The Guarantors hereby jointly
and severally agree that if Borrower or other Guarantor(s) shall fail to pay in
full when due (whether at stated maturity, by acceleration or otherwise) any of
the Guaranteed Obligations, the Guarantors will promptly pay the same in cash,
without any demand or notice whatsoever, and that in the case of any extension
of time of payment or renewal of any of the Guaranteed Obligations, the same
will be promptly paid in full when due (whether at extended maturity, by
acceleration or otherwise) in accordance with the terms of such extension or
renewal.

10.2 Obligations Unconditional. The obligations of the Guarantors under
Section 10.1 shall constitute a guaranty of payment and to the fullest extent
permitted by applicable Requirements of Law, are absolute, irrevocable and
unconditional, joint and several, irrespective of the value, genuineness,
validity, regularity or enforceability of the Guaranteed Obligations of Borrower
under this Agreement, the Notes, if any, or any other agreement or instrument
referred to herein or therein, or any substitution, release or exchange of any
other guarantee of or security for any of the Guaranteed Obligations, and
irrespective of any other circumstance whatsoever that might otherwise
constitute a legal or equitable discharge or defense of a surety or guarantor
(except for payment in full). Without limiting the generality of the foregoing,
it is agreed that the occurrence of any one or more of the following shall not
alter or impair the liability of the Guarantors hereunder, which shall remain
absolute, irrevocable and unconditional under any and all circumstances as
described above:

(i) at any time or from time to time, without notice to the Guarantors, the time
for any performance of or compliance with any of the Guaranteed Obligations
shall be extended, or such performance or compliance shall be waived;

(ii) any of the acts mentioned in any of the provisions of this Agreement or the
Notes, if any, or any other agreement or instrument referred to herein or
therein shall be done or omitted;

(iii) the maturity of any of the Guaranteed Obligations shall be accelerated, or
any of the Guaranteed Obligations shall be amended in any respect, or any right
under the Loan Documents or any other agreement or instrument referred to herein
or therein shall be amended or waived in any respect or any other guarantee of
any of the Guaranteed Obligations or any security therefor shall be released or
exchanged in whole or in part or otherwise dealt with;

(iv) any Lien or security interest granted to, or in favor of, the Issuing
Lender or any Lender or Agent as security for any of the Guaranteed Obligations
shall fail to be perfected;

(v) the release of any other Guarantor pursuant to Section 10.9;

(vi) any bankruptcy, insolvency, reorganization, arrangement, readjustment,
composition, liquidation or the like of any Loan Party; or

(vii) any lack of validity or enforceability of any Loan Document or any other
agreement or instrument relating thereto against any Loan Party.

 

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The Guarantors hereby expressly waive diligence, presentment, demand of payment,
protest and all notices whatsoever, and any requirement that any Secured Party
exhaust any right, power or remedy or proceed against Borrower under this
Agreement or the Notes, if any, or any other agreement or instrument referred to
herein or therein, or against any other Person under any other guarantee of, or
security for, any of the Guaranteed Obligations. The Guarantors waive any and
all notice of the creation, renewal, extension, waiver, termination or accrual
of any of the Guaranteed Obligations and notice of or proof of reliance by any
Secured Party upon this Guarantee or acceptance of this Guarantee, and the
Guaranteed Obligations, and any of them, shall conclusively be deemed to have
been created, contracted or incurred in reliance upon this Guarantee, and all
dealings between Borrower and the Secured Parties shall likewise be conclusively
presumed to have been had or consummated in reliance upon this Guarantee. This
Guarantee shall be construed as a continuing, absolute, irrevocable and
unconditional guarantee of payment without regard to any right of offset with
respect to the Guaranteed Obligations at any time or from time to time held by
Secured Parties, and the obligations and liabilities of the Guarantors hereunder
shall not be conditioned or contingent upon the pursuit by the Secured Parties
or any other Person at any time of any right or remedy against Borrower or
against any other Person which may be or become liable in respect of all or any
part of the Guaranteed Obligations or against any collateral security or
guarantee therefor or right of offset with respect thereto. This Guarantee shall
remain in full force and effect and be binding in accordance with and to the
extent of its terms upon the Guarantors and the successors and assigns thereof,
and shall inure to the benefit of the Lenders, and their respective successors
and assigns, notwithstanding that from time to time since the Closing Date there
may be no Guaranteed Obligations outstanding.

10.3 Reinstatement. The obligations of the Guarantors under this Section 10
shall be automatically reinstated if and to the extent that for any reason any
payment by or on behalf of Borrower or other Loan Party in respect of the
Guaranteed Obligations is rescinded or must be otherwise restored by any holder
of any of the Guaranteed Obligations, whether as a result of any proceedings in
bankruptcy or reorganization or otherwise.

10.4 Subrogation; Subordination. Each Guarantor hereby agrees that until the
indefeasible payment and satisfaction in full in cash of all Guaranteed
Obligations and the expiration and termination of the Commitments of the Lenders
under this Agreement it shall not assert or exercise any right or remedy, direct
or indirect, arising by reason of any performance by it of its guarantee in
Section 10.1, whether by subrogation or otherwise, against Borrower or any other
Guarantor of any of the Guaranteed Obligations or any security for any of the
Guaranteed Obligations. Any Debt of any Loan Party permitted pursuant to
Section 7.2(d) shall be subordinated to such Loan Party’s Secured Obligations in
the manner set forth in the Intercompany Note evidencing such Debt.

10.5 Remedies. The Guarantors jointly and severally agree that, as between the
Guarantors and the Lenders, the obligations of Borrower under this Agreement and
the Notes, if any, may be declared to be forthwith due and payable as provided
in Section 8.1 (and shall be deemed to have become automatically due and payable
in the circumstances provided in Section 8.1) for purposes of Section 10.1,
notwithstanding any stay, injunction or other prohibition preventing such
declaration (or such obligations from becoming automatically due and payable) as
against Borrower and that, in the event of such declaration (or such obligations
being deemed to have become automatically due and payable), such obligations
(whether or not due and payable by Borrower) shall forthwith become due and
payable by the Guarantors for purposes of Section 10.1.

10.6 Instrument for the Payment of Money. Each Guarantor hereby acknowledges
that the guarantee in this Section 10 constitutes an instrument for the payment
of money, and consents and agrees that any Lender or Agent, at its sole option,
in the event of a dispute by such Guarantor in the payment of any moneys due
hereunder, shall have the right to bring a motion-action under New York CPLR
Section 3213.

 

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10.7 Continuing Guarantee. Subject to Section 11.14, the guarantee in this
Section 10 is a continuing guarantee of payment, and shall apply to all
Guaranteed Obligations whenever arising.

10.8 General Limitation on Guaranteed Obligations. If in any action or
proceeding involving any state corporate limited partnership or limited
liability company law, or any applicable state, federal or foreign bankruptcy,
insolvency, reorganization, fraudulent conveyance or transfer law or regulation,
or other law affecting the rights of creditors generally, the obligations of any
Guarantor under Section 10.1 would otherwise be held or determined to be void,
voidable, invalid or unenforceable, or subordinated to the claims of any other
creditors, on account of the amount of its liability under Section 10.1, then,
notwithstanding any other provision to the contrary, the amount of such
liability shall, without any further action by such Guarantor, any Loan Party or
any other Person, be automatically limited and reduced to the highest amount
that is valid and enforceable and not subordinated to the claims of other
creditors.

10.9 Release of Guarantors. If, in compliance with the terms and provisions of
the Loan Documents, all or substantially all of the Capital Stock or property of
any Guarantor is sold or otherwise transferred from such Guarantor (a
“Transferred Guarantor”) to a Person or Persons, none of which is Borrower or a
Subsidiary, such Transferred Guarantor shall, upon the consummation of such sale
or transfer, be released from its obligations under this Agreement (including
under Section 11.5 hereof) and its obligations to pledge and grant any
Collateral owned by it pursuant to any Security Document and, in the case of a
sale of all or substantially all of the Capital Stock of the Transferred
Guarantor, the pledge of such Capital Stock to the Collateral Agent pursuant to
the Security Agreement shall be released, and the Collateral Agent shall take
such actions as are necessary to effect each such release in accordance with the
relevant provisions of the Security Documents within no more than 30 days from
notice to the Collateral Agent of such transfer. If, in compliance with the
terms and provisions of the Loan Documents (including, without limitation,
Sections 7.5 and 7.13), Capital Stock of a Guarantor is sold or otherwise
transferred so that such Guarantor is no longer a Wholly Owned Subsidiary of the
Borrower, upon the consummation of such sale or transfer, such Guarantor shall
be released, subject to pro forma compliance with Section 7.12, from its
obligations under this Agreement (including under this Section 10 and
Section 11.5 hereof) and its obligations to pledge and grant any Collateral
owned by it pursuant to any Security Document, and the Collateral Agent shall
take such actions as are necessary to effect each such release in accordance
with the relevant provisions of the Security Documents and to acknowledge in
writing such release and the termination of the guarantee of such Guarantor if
requested.

SECTION 11

MISCELLANEOUS

11.1 Amendments and Waivers. Neither this Agreement, any other Loan Document,
nor any terms hereof or thereof may be amended, supplemented or modified except
in accordance with the provisions of this Section 11.1. Amendments prior to the
completion of the syndication of the Commitments (as determined by the
Administrative Agent) shall, in addition to the other consents required by this
Section 11.1, require the consent of the Administrative Agent. Subject to the
preceding sentence, the Required Lenders and each Loan Party to the relevant
Loan Document may, or, with the written consent of the Required Lenders, the
Administrative Agent or the Collateral Agent, as applicable, and each Loan Party
to the relevant Loan Document may, from time to time, (a) enter into written
amendments, supplements or modifications hereto and to the other Loan Documents
for the purpose of adding any provisions

 

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to this Agreement or the other Loan Documents or changing in any manner the
rights of the Lenders or of the Loan Parties hereunder or thereunder or
(b) waive, on such terms and conditions as the Required Lenders or the
Administrative Agent or Collateral Agent, as the case may be, may specify in
such instrument, any of the requirements of this Agreement or the other Loan
Documents or any Default and its consequences; provided, however, pursuant to
Section 2.25, the Commitments and the Total Revolving Extensions of Credit of a
Defaulting Lender shall not be included in determining whether the Required
Lenders have taken or may take any action hereunder; provided, further, that no
such waiver and no such amendment, supplement or modification shall (i) forgive
the principal amount or extend the final scheduled date of maturity of any Loan,
extend the scheduled date of any amortization payment in respect of any Term
Loan, reduce the stated rate of any interest, premium or fee payable hereunder
(except (x) in connection with the waiver of applicability of any post-default
increase in interest rates and (y) that any amendment or modification of defined
terms used in the financial covenants in this Agreement shall not constitute a
reduction in the rate of interest or fees for purposes of this clause (i)) or
extend the scheduled date of any payment thereof, or increase the amount or
extend the expiration date of any Lender’s Revolving Commitment under the
applicable Revolving Facility or increase the maximum duration of Interest
Periods hereunder or alter the provisions of Section 8.2 (it being understood
that if additional classes of Term Loans or additional Loans under this
Agreement consented to by the Required Lenders or additional Loans pursuant to
Section 2.24 are made, such new Loans being included on a pro rata basis within
Section 8.2 shall not be considered an alteration thereof), in each case without
the written consent of each Lender directly affected thereby; (ii) eliminate or
reduce the voting rights of any Lender under this Section 11.1 without the
written consent of such Lender; (iii) reduce any percentage specified in the
definition of “Required Lenders,” consent to the assignment or transfer by the
Borrower of any of its rights and obligations under this Agreement and the other
Loan Documents, release all or substantially all of the Collateral or release
all or substantially all of the Guarantors from their guarantee under
Section 10, in each case without the written consent of all Lenders (it being
understood that lenders added pursuant to Section 2.24 or lenders under
additional classes of Term Loans or additional Loans under this Agreement
consented to by the Required Lenders being included in such definition shall not
be deemed to require the written consent of all Lenders); (iv) amend, modify or
waive any provision of Section 2.17 without the written consent of the Majority
Facility Lenders in respect of each Facility adversely affected thereby;
(v) reduce the amount of Net Cash Proceeds or Excess Cash Flow required to be
applied to prepay Loans under this Agreement without the written consent of the
Majority Facility Lenders with respect to each Facility; (vi) reduce the
percentage specified in the definition of Majority Facility Lenders with respect
to any Facility without the written consent of all Lenders under such Facility;
(vii) change the application of prepayments as among or between Facilities under
Section 2.11(d), without the written consent of the Majority Facility Lenders of
each Facility that is being allocated a lesser prepayment as a result thereof
(it being understood that if additional classes of Term Loans or additional
Loans under this Agreement consented to by the Required Lenders or additional
Loans pursuant to Section 2.24 are made, such new Loans may be included on a pro
rata basis in the various prepayments required pursuant to Section 2.11(d));
(viii) expressly change or waive any condition precedent in Section 5.2 to any
Revolving Borrowing without the written consent of the Majority Facility Lenders
with respect to the applicable Revolving Facility; (ix) amend, modify or waive
any provision of Section 9 without the written consent of the Administrative
Agent; (x) amend, modify or waive any provision of Section 2.6 or 2.7 without
the written consent of the Swingline Lender; (xi) amend, modify or waive any
provision of Section 3 without the written consent of the Issuing Lender; or
(xii) amend Section 1.7 or the definition of “Alternative Currency” without the
written consent of each Alternative Currency Revolving Lender. Any such waiver
and any such amendment, supplement or modification shall apply equally to each
of the Lenders and shall be binding upon the Loan Parties, the Lenders, the
Administrative Agent and all future holders of the Loans. In the case of any
waiver, the Loan Parties, the Lenders and the Administrative Agent shall be
restored to their former position and rights hereunder and under the other Loan
Documents, and any Default or waived shall be deemed to be cured and not
continuing; but no such waiver shall extend to any subsequent or other Default,
or impair any right consequent thereon.

 

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Without the consent of any other Person, the applicable Loan Party or Parties
and the Administrative Agent and/or Collateral Agent may (in its or their
respective sole discretion, or shall, to the extent required by any Loan
Document) enter into any amendment or waiver of any Loan Document, or enter into
any new agreement or instrument, to effect the granting, perfection, protection,
expansion or enhancement of any security interest in any Collateral or
additional property to become Collateral for the benefit of the Secured Parties,
or as required by local law to give effect to, or protect, any security interest
for the benefit of the Secured Parties, in any property or so that the security
interests therein comply with applicable Requirements of Law.

If, in connection with any proposed change, waiver, discharge or termination of
the provisions of this Agreement as contemplated by this Section, the consent of
75% of the Lenders whose consent is required is obtained but the consent of one
or more of such other Lenders whose consent is required is not obtained, then
the Borrower shall have the right to replace all, but not less than all, of such
non-consenting Lender or Lenders (so long as all non-consenting Lenders are so
replaced) with one or more Persons pursuant to Section 2.22 so long as at the
time of such replacement each such new Lender consents to the proposed change,
waiver, discharge or termination.

11.2 Notices.

(a) Except in the case of notices and other communications expressly permitted
to be given by telephone (and subject to 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 telecopy, as follows:

(i) if to a Loan Party, to the Borrower at DaVita Inc., 1551 Wewatta Street,
Denver, Colorado 80202, Attention of Vice President - Finance (Telecopy
No. 866-845-2762), with a copy to DaVita Inc., 601 Hawaii Street, El Segundo,
California 90245, Attention of Vice President, General Counsel & Secretary
(Telecopy No. 310-536-2701);

(ii) if to the Administrative Agent or the Collateral Agent, to JPMorgan Chase
Bank, Loan and Agency Services Group, 1111 Fannin, 10th Floor, Houston, Texas
77002, Attention of Agency Services (Telecopy No. (713) 750-2782), with a copy
to (a) JPMorgan Chase Bank, 383 Madison Avenue, New York 10179, Attention of
Dawn Lee Lum (Telecopy No. 212-270-3279) and (b) J.P. Morgan Europe Ltd., Loan
and Agency Department, 125 London Wall, London EC2Y 5 AJ, Attention: Sue Dalton
(Telecopy No. 44 207 7777 2360), with respect to Alternative Currency Revolving
Facility;

(iii) if to the Issuing Lender, to it at Letter of Credit Department, 10420
Highland Manor Drive, Floor 4, Tampa, FL 33610-9128, Attention of James Alonzo
(Telecopy No. (813) 432-5162), with a copy to JPMorgan Chase Bank, 383 Madison
Avenue, New York, NY 10179, Attention of Dawn Lee Lum (Telecopy
No. 212-270-3279);

(iv) if to the Swingline Lender, to it at Loan and Agency Services Group, 11111
Fannin, 10th Floor, Houston, Texas 77002, Attention of Agency Services (Telecopy
No. (713) 750-2782), with a copy to JPMorgan Chase Bank, 383 Madison Avenue, New
York, NY 10179, Attention of Dawn Lee Lum (Telecopy No. 212-270-3279); and

 

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(v) if to any other Lender, to it at its address (or telecopy number) set forth
in its Administrative Questionnaire.

(b) Any party hereto may change its address or telecopy number for notices and
other communications hereunder by notice to the other parties hereto. All
notices and other communications given to any party hereto in accordance with
the provisions of this Agreement shall be deemed to have been given on the date
of receipt.

(c) Electronic Communications. Notices and other communications to the Lenders
and the Issuing Lender hereunder may (subject to Section 11.2(d)) be delivered
or furnished by electronic communication (including e-mail and Internet or
intranet websites) pursuant to procedures approved by the Administrative Agent;
provided that the foregoing shall not apply to notices to any Lender or the
Issuing Lender pursuant to Section 2 if such Lender or the Issuing Lender, as
applicable, has notified the Administrative Agent that it is incapable of
receiving notices under such Section by electronic communication. The
Administrative Agent, the Collateral Agent 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 (including as
set forth in Section 11.2(d)); provided that approval of such procedures may be
limited to particular notices or communications.

Unless the Administrative Agent 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); provided that if such notice or other communication is
not sent during the normal business hours of the recipient, such notice or
communication shall be deemed to have been sent at the opening of business on
the next business day for the recipient, 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.

(d) Posting. Each Loan Party hereby agrees that it will provide to the
Administrative Agent all information, documents and other materials that it is
obligated to furnish to the Administrative Agent pursuant to this Agreement and
any other Loan Document, including all notices, requests, financial statements,
financial and other reports, certificates and other information materials, but
excluding any such communication that (i) relates to a request for a new, or a
conversion of an existing, Loan or other extension of credit (including any
election of an interest rate or interest period relating thereto), (ii) relates
to the payment of any principal or other amount due under this Agreement prior
to the scheduled date therefor, (iii) provides notice of any Default under this
Agreement or (iv) is required to be delivered to satisfy any condition precedent
to the effectiveness of this Agreement and/or any borrowing or other extension
of credit hereunder (all such non-excluded communications, collectively, the
“Communications”), by transmitting the Communications in an electronic/soft
medium in a format reasonably acceptable to the Administrative Agent at
dawn.leelum@jpmorgan.com or at such other e-mail address(es) provided to the
Borrower from time to time or in such other form, including hard copy delivery
thereof, as the Administrative Agent shall require. In addition, each Loan Party
agrees to continue to provide the Communications to the Administrative Agent in
the manner specified in this Agreement or any other Loan Document or in such
other form, including hard copy delivery thereof, as the Administrative Agent
shall require. Nothing in this Section 11.2 shall prejudice the right of the
Agents, any Lender or any Loan Party to give any notice or other communication
pursuant to this Agreement or any other Loan Document in any other manner
specified in this Agreement or any other Loan Document or as any such Agent
shall require.

 

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To the extent consented to by the Administrative Agent in writing from time to
time, Administrative Agent agrees that receipt of the Communications by the
Administrative Agent at its e-mail address(es) set forth above shall constitute
effective delivery of the Communications to the Administrative Agent for
purposes of the Loan Documents; provided that the Borrower shall also deliver to
the Administrative Agent an executed original of each Compliance Certificate
required to be delivered hereunder.

Each Loan Party further agrees that Administrative Agent may make the
Communications available to the Lenders by posting the Communications on
Intralinks or a substantially similar electronic transmission system (the
“Platform”). The Platform is provided “as is” and “as available.” The Agents do
not warrant the accuracy or completeness of the Communications, or the adequacy
of the Platform and expressly disclaim liability for errors or omissions in the
communications. No warranty of any kind, express, implied or statutory,
including, without limitation, any warranty of merchantability, fitness for a
particular purpose, non-infringement of third party rights or freedom from
viruses or other code defects, is made by any Agent in connection with the
Communications or the Platform. In no event shall the Administrative Agent or
any of its Related Parties have any liability to the Loan Parties, any Lender or
any other Person for damages of any kind, including direct or indirect, special,
incidental or consequential damages, losses or expenses (whether in tort,
contract or otherwise) arising out of any Loan Party’s or the Administrative
Agent’s transmission of communications through the Internet, except to the
extent the liability of such Person is found in a final non-appealable judgment
by a court of competent jurisdiction to have resulted from such Person’s gross
negligence or willful misconduct.

11.3 No Waiver; Cumulative Remedies. No failure to exercise and no delay in
exercising, on the part of the Administrative Agent or any Lender, any right,
remedy, power or privilege hereunder or under the other Loan Documents shall
operate as a waiver thereof; nor shall any single or partial exercise of any
right, remedy, power or privilege hereunder preclude any other or further
exercise thereof or the exercise of any other right, remedy, power or privilege.
The rights, remedies, powers and privileges herein provided are cumulative and
not exclusive of any rights, remedies, powers and privileges provided by law.

11.4 Survival. All covenants, agreements, representations and warranties made by
the Loan Parties herein and in the certificates or other instruments delivered
in connection with or pursuant to this Agreement shall be considered to have
been relied upon by the other parties hereto and shall survive the execution and
delivery of this Agreement and the making of any Loans and issuance of any
Letters of Credit, regardless of any investigation made by any such other party
or on its behalf and notwithstanding that the Administrative Agent, the
Collateral Agent, the Issuing Lender or any Lender may have had notice or
knowledge of any Default or incorrect representation or warranty at the time any
credit is extended hereunder, and shall continue in full force and effect as
long as the principal of or any accrued interest on any Loan or any fee or any
other amount payable under this Agreement is outstanding and unpaid or any
Letter of Credit is outstanding and so long as the Commitments have not expired
or terminated. The provisions of Sections 2.18, 2.19, 2.20 and 11.5 and
Section 9 shall survive and remain in full force and effect regardless of the
consummation of the transactions contemplated hereby, the repayment of the
Loans, the expiration or termination of the Letters of Credit and the
Commitments or the termination of this Agreement or any provision hereof.

11.5 Expenses; Indemnity; Damage Waiver.

(a) The Borrower shall pay (i) all reasonable out-of-pocket expenses incurred by
the Administrative Agent, the Collateral Agent and their respective Affiliates,
including the reasonable fees, charges and disbursements of counsel for the
Administrative Agent and the Collateral Agent, in

 

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connection with the syndication of the credit facilities provided for herein,
the preparation and administration of this Agreement, the 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 out-of-pocket expenses incurred by the Issuing
Lender in connection with the issuance, amendment, renewal or extension of any
Letter of Credit or any demand for payment thereunder and (iii) all reasonable
out-of-pocket expenses incurred by the Administrative Agent, the Collateral
Agent, the Issuing Lender or any Lender, including the fees, charges and
disbursements of any counsel for the Administrative Agent, the Collateral Agent,
the Issuing Lender or any Lender, in connection with the enforcement or
protection of its rights in connection with this Agreement, including its rights
under this Section, or 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; provided that the Borrower shall not be obligated to pay legal fees and
expenses incurred pursuant to clauses (i) and (ii) above in connection with the
syndication of the credit facilities or the preparation of the Loan Documents
prior to the initial Credit Extension.

(b) The Borrower shall indemnify the Administrative Agent (or any sub-agent
thereof), the Collateral Agent (or any sub-agent thereof), the Issuing Lender
and each Lender, and each Related Party of any of the foregoing Persons (each
such Person being called an “Indemnitee”), against, and hold each Indemnitee
harmless from, any and all losses, claims, damages, liabilities and related
expenses, including the fees, charges and disbursements of any counsel for any
Indemnitee, incurred by or asserted against any Indemnitee arising out of, in
connection with or as a result of (i) the execution or delivery of this
Agreement, any 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 or
any other transactions contemplated hereby or thereby, (ii) any Loan or Letter
of Credit or the use of the proceeds therefrom (including any refusal by the
Issuing 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 or threatened Release of Hazardous Materials at, on, under or from any
property owned or operated by any Group Member, any Environmental Liability
related in any way to any Group Member or any violation of healthcare laws
related in any way to any Group Member, or (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, regardless of whether
brought by a third party or by a Loan Party and regardless of whether any
Indemnitee is a party thereto; provided that such indemnity shall not, as to any
Indemnitee, be available to the extent that such losses, claims, damages,
liabilities or related expenses arise from the material breach by such
Indemnitee of this Agreement or are determined by a court of competent
jurisdiction by final and nonappealable judgment to have been incurred primarily
by reason of the gross negligence or willful misconduct of such Indemnitee and
that if any Indemnitee shall receive indemnification that is later disallowed by
this proviso, it shall promptly repay to the Borrower any such funds.

(c) To the extent that the Borrower fails to pay any amount required to be paid
by it to the Administrative Agent (or any sub-agent thereof), the Collateral
Agent (or any sub-agent thereof), the Issuing Lender or the Swingline Lender
under paragraph (a) or (b) of this Section, each Lender severally agrees to pay
to the Administrative Agent, the Collateral Agent, the Issuing Lender or the
Swingline Lender, as the case may be, such Lender’s Aggregate Exposure
Percentage (determined as of the time that the applicable unreimbursed expense
or indemnity payment is sought) of such unpaid amount; provided that the
unreimbursed expense or indemnified loss, claim, damage, liability or related
expense, as the case may be, was incurred by or asserted against the
Administrative Agent, the Collateral Agent, the Issuing Lender or the Swingline
Lender in its capacity as such.

 

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(d) To the extent permitted by applicable law, the Borrower 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 Loan Document or any agreement or instrument contemplated hereby
or thereby, the Transactions, any Loan or Letter of Credit or the use of the
proceeds thereof.

(e) All amounts due under this Section shall be payable promptly after written
demand therefor.

11.6 Successors and Assigns; Participations and Assignments.

(a) The provisions of this Agreement shall be binding upon and inure to the
benefit of the parties hereto and their respective successors and assigns
permitted hereby (including any affiliate of the Issuing Lender that issues any
Letter of Credit), except that (i) the Borrower may not assign or otherwise
transfer any of its rights or obligations hereunder without the prior written
consent of each Lender (and any attempted assignment or transfer by the Borrower
without such consent shall be null and void) and (ii) no Lender may assign or
otherwise transfer its rights or obligations hereunder except in accordance with
this Section. Nothing in this Agreement, expressed or implied, shall be
construed to confer upon any Person (other than the parties hereto, their
respective successors and assigns permitted hereby (including any Affiliate of
the Issuing Lender that issues any Letter of Credit), Participants (to the
extent provided in paragraph (c) of this Section) and, to the extent expressly
contemplated hereby, the Related Parties of each of the Administrative Agent,
the Issuing Lender and the Lenders) any legal or equitable right, remedy or
claim under or by reason of this Agreement.

(b) (i) Subject to the conditions set forth in paragraph (b)(ii) below, any
Lender may assign to one or more assignees (each, an “Assignee”) all or a
portion of its rights and obligations under this Agreement (including all or a
portion of Commitments and the Loans at the time owing to it) with the prior
written consent (such consent not to be unreasonably withheld or delayed) of:

(A) the Borrower; provided that no consent of the Borrower shall be required for
an assignment to a Lender, an affiliate of a Lender, an Approved Fund or, if an
Event of Default under Section 8.1(a), 8.1(b) or 8.1(g) has occurred and is
continuing, any other Person (other than a Disqualified Lender); provided,
further, that the Borrower shall be deemed to have consented to any such
assignment unless it shall object thereto by written notice to the
Administrative Agent within five (5) Business Days after having received notice
thereof;

(B) the Administrative Agent; provided that no consent of the Administrative
Agent shall be required for an assignment to a Lender, an affiliate of a Lender
or an Approved Fund; and

(C) the Issuing Lender and the Swingline Lender; provided that no consent of the
Issuing Lender or the Swingline Lender shall be required for an assignment of
all or any portion of a Term Loan.

(ii) Assignments shall be subject to the following additional conditions:

(A) except in the case of an assignment to a Lender, an affiliate of a Lender or
an Approved Fund or an assignment of the entire remaining amount of the
assigning Lender’s Commitments or Loans under any Facility, the amount of the
Commitments or Loans of the assigning Lender subject to each such assignment
(determined as of the date the Assignment and Assumption with respect to such
assignment is delivered to the Administrative Agent) shall not

 

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be less than $5,000,000 (or, in the case of the Tranche B Term Facility,
$1,000,000) unless each of the Borrower and the Administrative Agent otherwise
consents; provided that (1) no such consent of the Borrower shall be required if
an Event of Default under Sections 8.1(a), (b) or (g) has occurred and is
continuing and (2) such amounts shall be aggregated in respect of each Lender
and its affiliates or Approved Funds, if any;

(B) each partial assignment shall be made as an assignment of a proportionate
part of all the assigning Lender’s rights and obligations under this Agreement;
provided that this clause shall not be construed to prohibit the assignment of a
proportionate part of all the assigning Lender’s rights and obligations in
respect of one Facility;

(C) the parties to each assignment shall execute and deliver to the
Administrative Agent an Assignment and Assumption, together with a processing
and recordation fee of $3,500 (provided that the Administrative Agent may waive
such fee in its sole discretion); and

(D) the Assignee, if it shall not be a Lender, shall deliver to the
Administrative Agent an Administrative Questionnaire.

For the purposes of this Section 11.6, the term “Approved Fund” has the
following meaning:

“Approved Fund” means any Person (other than a natural person) that is engaged
in making, purchasing, holding or investing in bank loans and similar extensions
of credit in the ordinary course of its business and that is administered or
managed by (a) a Lender, (b) an Affiliate of a Lender or (c) an entity or an
Affiliate of an entity that administers or manages a Lender.

(iii) Subject to acceptance and recording thereof pursuant to paragraph (b)(iv)
below, from and after the effective date specified in each Assignment and
Assumption the Assignee thereunder shall be a party hereto and, to the extent of
the interest assigned by such Assignment and Assumption, have the rights and
obligations of a Lender under this Agreement, and the assigning Lender
thereunder shall, to the extent of the interest assigned by such Assignment and
Assumption, be released from its obligations under this Agreement (and, in the
case of an Assignment and Assumption covering all of the assigning Lender’s
rights and obligations under this Agreement, such Lender shall cease to be a
party hereto but shall continue to be entitled to the benefits of Sections 2.18,
2.19, 2.20 and 11.5). Any assignment or transfer by a Lender of rights or
obligations under this Agreement that does not comply with this Section 11.6
shall be treated for purposes of this Agreement as a sale by such Lender of a
participation in such rights and obligations in accordance with paragraph (c) of
this Section.

(iv) The Administrative Agent, acting for this purpose as an agent of the
Borrower, shall maintain at one of its offices a copy of each Assignment and
Assumption delivered to it and a register for the recordation of the names and
addresses of the Lenders, and the Commitments of, and principal amount of the
Loans and LC Disbursements owing to, each Lender pursuant to the terms hereof
from time to time (the “Register”). The entries in the Register shall be
conclusive, and the Borrower, the Administrative Agent, the Issuing Lender and
the Lenders shall treat each Person whose name is recorded in the Register
pursuant to the terms hereof as a Lender hereunder for all purposes of this
Agreement, notwithstanding notice to the contrary. The Register shall be
available for inspection by the Agents, the Borrower, the Issuing Lender and any
Lender, at any reasonable time and from time to time upon reasonable prior
notice.

(v) Upon its receipt of a duly completed Assignment and Assumption executed by
an assigning Lender and an Assignee, the Assignee’s completed Administrative
Questionnaire (unless the

 

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Assignee shall already be a Lender hereunder), the processing and recordation
fee referred to in paragraph (b) of this Section and any written consent to such
assignment required by paragraph (b) of this Section, the Administrative Agent
shall accept such Assignment and Assumption and record the information contained
therein in the Register; provided that if either the assigning Lender or the
assignee shall have failed to make any payment required to be made by it
pursuant to Section 2.7(b) or (c), 3.4, 3.5, 2.17(e) or 11.5, the Administrative
Agent shall have no obligation to accept such Assignment and Assumption and
record the information therein in the Register unless and until such payment
shall have been made in full, together with all accrued interest thereon. No
assignment shall be effective for purposes of this Agreement unless it has been
recorded in the Register as provided in this paragraph.

(c)(i) Any Lender may, without the consent of the Borrower, the Administrative
Agent, the Issuing Lender or the Swingline Lender, sell participations to one or
more banks or other entities (other than a Disqualified Lender) (a
“Participant”) in all or a portion of such Lender’s rights and obligations under
this Agreement (including all or a portion of its Commitments and the Loans
owing to it); provided that (A) such Lender’s obligations under this Agreement
shall remain unchanged, (B) such Lender shall remain solely responsible to the
other parties hereto for the performance of such obligations and (C) the
Borrower, the Administrative Agent, the Issuing Lender and the other Lenders
shall continue to deal solely and directly with such Lender in connection with
such Lender’s rights and obligations under this Agreement. Any agreement
pursuant to which a Lender sells such a participation shall provide that such
Lender shall retain the sole right to enforce this Agreement and to approve any
amendment, modification or waiver of any provision of this Agreement; provided
that such agreement may provide that such Lender will not, without the consent
of the Participant, agree to any amendment, modification or waiver that
(1) requires the consent of each Lender directly affected thereby pursuant to
the second proviso to the third sentence of Section 11.1 and (2) directly
affects such Participant. Subject to paragraph (c)(ii) of this Section, the
Borrower agrees that each Participant shall be entitled to the benefits of
Sections 2.18, 2.19 and 2.20, and shall be subject to Section 2.21, to the same
extent as if it were a Lender and had acquired its interest by assignment
pursuant to paragraph (b) of this Section. To the extent permitted by law, each
Participant also shall be entitled to the benefits of Section 11.7(b) as though
it were a Lender; provided such Participant shall be subject to Section 11.7(a)
as though it were a Lender. Notwithstanding the foregoing, each Loan Party and
the Lenders acknowledge and agree that the Administrative Agent shall not have
any responsibility to determine the compliance of any Lender with the
requirements of this Section 11.6(c) (it being understood that each Lender shall
be responsible for ensuring its own compliance with the requirements of this
Section).

(ii) A Participant shall not be entitled to receive any greater payment under
Section 2.18 or 2.19 than the applicable Lender would have been entitled to
receive with respect to the participation sold to such Participant, unless the
sale of the participation to such Participant is made with the Borrower’s prior
written consent, which shall not be unreasonably withheld or delayed. Any
Participant that is a Non-U.S. Lender shall not be entitled to the benefits of
Section 2.19 unless such Participant agrees to comply with Section 2.19(e).

(iii) Each Lender that sells a participation, acting solely for this purpose as
a non-fiduciary agent of the Borrower, shall maintain at one of its offices a
register on which it enters the names and addresses of each Participant and the
principal amounts (and related interest amounts) of each Participant’s interest
in the Loans or other obligations under this Agreement (the “Participant
Register”). The entries in the Participant Register shall be conclusive, and
such Lender shall treat each Person whose name is recorded in the Participant
Register pursuant to the terms hereof as the owner of such participation for all
purposes of this Agreement, notwithstanding notice to the contrary.

 

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(d) Any Lender may at any time pledge or assign a security interest in all or
any portion of its rights under this Agreement to secure obligations of such
Lender, including any pledge or assignment to secure obligations to a Federal
Reserve Bank, and this Section shall not apply to any such pledge or assignment
of a security interest; provided that no such pledge or assignment of a security
interest shall release a Lender from any of its obligations hereunder or
substitute any such pledgee or Assignee for such Lender as a party hereto.

(e) Notwithstanding the foregoing, any Conduit Lender may assign any or all of
the Loans it may have funded hereunder to its designating Lender without the
consent of the Borrower or the Administrative Agent and without regard to the
limitations set forth in Section 11.6(b). Each of the Borrower, each Lender and
the Administrative Agent hereby confirms that it will not institute against a
Conduit Lender or join any other Person in instituting against a Conduit Lender
any bankruptcy, reorganization, arrangement, insolvency or liquidation
proceeding under any state bankruptcy or similar law, for one year and one day
after the payment in full of the latest maturing commercial paper note issued by
such Conduit Lender; provided, however, that each Lender designating any Conduit
Lender hereby agrees to indemnify, save and hold harmless each other party
hereto for any loss, cost, damage or expense arising out of its inability to
institute such a proceeding against such Conduit Lender during such period of
forbearance.

(f) The Borrower, at its sole expense and upon receipt of written notice from
the relevant Lender, agrees to issue Note(s) to any Lender requiring Note(s) to
facilitate transactions of the type described in this Section 11.6.

11.7 Adjustments; Set-off.

(a) Except to the extent that this Agreement expressly provides for payments to
be allocated to a particular Lender or to the Lenders under a particular
Facility, if any Lender (a “Benefitted Lender”) shall receive any payment of all
or part of the Obligations owing to it, or receive any collateral in respect
thereof (whether voluntarily or involuntarily, by set-off, pursuant to events or
proceedings of the nature referred to in Section 8.1(g), or otherwise), in a
greater proportion than any such payment to or collateral received by any other
Lender, if any, in respect of the Obligations owing to such other Lender, such
Benefitted Lender shall purchase for cash from the other Lenders a participating
interest in such portion of the Obligations owing to each such other Lender, or
shall provide such other Lenders with the benefits of any such collateral, as
shall be necessary to cause such Benefitted Lender to share the excess payment
or benefits of such collateral ratably with each of the Lenders; provided,
however, that if all or any portion of such excess payment or benefits is
thereafter recovered from such Benefitted Lender, such purchase shall be
rescinded, and the purchase price and benefits returned, to the extent of such
recovery, but without interest.

(b) If an Event of Default shall have occurred and be continuing, each Lender
and each of its Affiliates is hereby authorized at any time and from time to
time, to the fullest extent permitted by law, to set off and apply any and all
deposits (general or special, time or demand, provisional or final) at any time
held and other obligations at any time owing by such Lender or Affiliate to or
for the credit or the account of the Borrower against any of and all the
obligations of the Borrower now or hereafter existing under this Agreement held
by such Lender, irrespective of whether or not such Lender shall have made any
demand under this Agreement and although such obligations may be unmatured. The
rights of each Lender under this Section are in addition to other rights and
remedies (including other rights of setoff) which such Lender may have.

11.8 Counterparts; Integration; Effectiveness. This Agreement may be executed in
counterparts (and by different parties hereto on different counterparts), each
of which shall constitute an

 

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original, but all of which when taken together shall constitute a single
contract. This Agreement and any separate letter agreements with respect to fees
payable to the Administrative Agent 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. Except as provided in Section 5.1, this Agreement shall become effective
when it shall have been executed by the Administrative Agent and when the
Administrative Agent shall have received counterparts hereof which, when taken
together, bear the signatures of each of the other parties hereto, and
thereafter shall be binding upon and inure to the benefit of the parties hereto
and their respective successors and assigns. Delivery of an executed counterpart
of a signature page of this Agreement by telecopy shall be effective as delivery
of a manually executed counterpart of this Agreement.

11.9 Severability. Any provision of this Agreement that is prohibited or
unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective
to the extent of such prohibition or unenforceability without invalidating the
remaining provisions hereof, and any such prohibition or unenforceability in any
jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction.

11.10 WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY 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 THE TRANSACTIONS CONTEMPLATED HEREBY (WHETHER BASED ON CONTRACT,
TORT OR ANY OTHER THEORY). EACH PARTY HERETO (A) CERTIFIES THAT NO
REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY
OR OTHERWISE, THAT SUCH OTHER PARTY 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 BY, AMONG OTHER
THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION.

11.11 GOVERNING LAW. THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE
PARTIES UNDER THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED
IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK (INCLUDING, WITHOUT
LIMITATION, SECTIONS 5-1401 AND 5-1402 OF THE NEW YORK GENERAL OBLIGATIONS LAW,
BUT OTHERWISE WITHOUT REGARD TO CONFLICTS OF LAWS PRINCIPLES THEREOF).

11.12 Submission to Jurisdiction; Waivers. Each party hereby irrevocably and
unconditionally:

(a) submits for itself and its property in any legal action or proceeding
relating to this Agreement and the other Loan Documents to which it is a party,
or for recognition and enforcement of any judgment in respect thereof, to the
exclusive general jurisdiction of the courts of the State of New York, the
courts of the United States for the Southern District of New York, and appellate
courts from any thereof;

(b) consents that any such action or proceeding may be brought in such courts
and waives any objection that it may now or hereafter have to the venue of any
such action or proceeding in any such court or that such action or proceeding
was brought in an inconvenient court and agrees not to plead or claim the same
and agrees that a final judgment in any such action or proceeding shall be
conclusive and may be enforced in other jurisdictions by suit on the judgment or
in any other manner provided by law;

 

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(c) agrees that service of process in any such action or proceeding may be
effected by mailing a copy thereof by registered or certified mail (or any
substantially similar form of mail), postage prepaid, to it at its address set
forth in Section 11.2 or at such other address of which the Administrative Agent
shall have been notified pursuant thereto;

(d) agrees that nothing herein shall affect the right to effect service of
process in any other manner permitted by law or shall limit the right to sue in
any other jurisdiction; and

(e) waives, to the maximum extent not prohibited by law, any right it may have
to claim or recover in any legal action or proceeding referred to in this
Section any special, exemplary, punitive or consequential damages.

11.13 Acknowledgments. Each of the Loan Parties hereby acknowledges that:

(a) it has been advised by counsel in the negotiation, execution and delivery of
this Agreement and the other Loan Documents;

(b) neither the Administrative Agent or the Collateral Agent nor any Lender has
any fiduciary relationship with or duty to any Loan Party arising out of or in
connection with this Agreement or any of the other Loan Documents, and the
relationship between the Administrative Agent, the Collateral Agent and Lenders,
on one hand, and the Loan Parties, on the other hand, in connection herewith or
therewith is solely that of debtor and creditor; and

(c) no joint venture is created hereby or by the other Loan Documents or
otherwise exists by virtue of the transactions contemplated hereby among the
Lenders or among the Loan Parties and the Lenders.

11.14 Releases of Guarantees and Liens.

(a) Notwithstanding anything to the contrary contained herein or in any other
Loan Document, the Collateral Agent is hereby irrevocably authorized by each
Lender (without requirement of notice to or consent of any Lender except as
expressly required by Section 11.1) to take any action requested by the Borrower
having the effect of releasing any Collateral or any Guarantor (i) in connection
with (A) the sale of such Collateral or the sale of all or substantially all of
Capital Stock of such Guarantor, in each case, to a Person or Persons, none of
which is the Borrower or a Subsidiary in compliance with the terms and
provisions of the Loan Documents or (B) a transaction that has been consented to
in accordance with Section 11.1 or (ii) under the circumstances described in
paragraph (b) below.

(b) At such time as the Loans, the LC Disbursements and the other accrued
obligations (including accrued indemnity obligations) under the Loan Documents
(other than obligations under or in respect of Swap Agreements) shall have been
paid in full, the Commitments have been terminated and no Letters of Credit
shall be outstanding, the Collateral shall be released from the Liens created by
the Security Documents, and the Security Documents and all obligations (other
than those expressly stated to survive such termination) of the Collateral Agent
and each Loan Party under the Security Documents shall terminate, all without
delivery of any instrument or performance of any act by any Person.

11.15 Confidentiality. Each of the Administrative Agent, the Collateral Agent,
the Issuing Lender and the Lenders agrees to maintain the confidentiality of the
Information (as defined below),

 

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except that Information may be disclosed (a) to its and its Affiliates’
directors, officers, employees and agents, including accountants, legal counsel
and other advisors (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 requested
by any regulatory authority, (c) to the extent required by applicable laws or
regulations or by any subpoena or similar legal process, (d) to any other party
to this Agreement, (e) in connection with the exercise of any remedies hereunder
or any suit, action or proceeding relating to this Agreement or the enforcement
of rights hereunder, (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 or obligations under this Agreement, (ii) any pledgee or prospective
pledgee referred to in Section 11.6(d) or (iii) any actual or prospective
counterparty (or its advisors) to any swap or derivative transaction relating to
the Borrower and its obligations, (g) with the consent of the Borrower or (h) 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
Administrative Agent, the Collateral Agent, the Issuing Lender or any Lender on
a nonconfidential basis from a source other than the Borrower. For the purposes
of this Section, “Information” means all information received from the Borrower
relating to the Borrower or its business, other than any such information that
is available to the Administrative Agent, the Collateral Agent, the Issuing
Lender or any Lender on a nonconfidential basis prior to disclosure by the
Borrower; provided that, in the case of information received from the Borrower
after the Closing Date, 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.

11.16 Headings. Section headings and the Table of Contents used herein are for
convenience of reference only, are not part of this Agreement and shall not
affect the construction of, or be taken into consideration in interpreting, this
Agreement.

11.17 USA PATRIOT Act. Each Lender that is subject to the requirements of the
Patriot Act hereby notifies the Borrower that pursuant to the requirements of
the Patriot Act, it is required to obtain, verify and record information that
identifies the Borrower, which information includes the name and address of the
Borrower and other information that will allow such Lender to identify the
Borrower in accordance with the Patriot Act.

11.18 Interest Rate Limitation. Notwithstanding anything herein to the contrary,
if at any time the interest rate applicable to any Loan, together with all fees,
charges and other amounts which are treated as interest on such Loan under
applicable law (collectively the “Charges”), shall exceed the maximum lawful
rate (the “Maximum Rate”) which may be contracted for, charged, taken, received
or reserved by the Lender holding such Loan in accordance with applicable law,
the rate of interest payable in respect of such Loan hereunder, together with
all Charges payable in respect thereof, shall be limited to the Maximum Rate
and, to the extent lawful, the interest and Charges that would have been payable
in respect of such Loan but were not payable as a result of the operation of
this Section shall be cumulated and the interest and Charges payable to such
Lender in respect of other Loans or periods shall be increased (but not above
the Maximum Rate therefor) until such cumulated amount, together with interest
thereon at the Federal Funds Effective Rate to the date of repayment, shall have
been received by such Lender.

11.19 Delivery of Addenda. Each initial Lender shall become a party to this
Agreement by delivering to the Administrative Agent an Addendum duly executed by
such Lender, the Borrower and the Administrative Agent.

 

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11.20 Third Party Beneficiary. None of the provisions contained in this
Agreement are intended by the parties hereto, nor shall they be deemed, to
confer any benefit on any Person not a party to this Agreement other than, to
the extent provided herein, any Indemnitee or Secured Party. The representations
and warranties of the Loan Parties contained herein are provided for the benefit
of the Administrative Agent, the Collateral Agent, the Issuing Lender and each
of the Lenders and their respective successors and permitted assigns in
accordance herewith, and are not being provided for the benefit of any other
Person (which other Person shall include, for this purpose, without limitation,
any shareholder of any Loan Party).

[SIGNATURE PAGES FOLLOW]

 

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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed and delivered by their proper and duly authorized officers as of the
day and year first above written.

 

DAVITA INC. By:  

/s/ Chet Mehta

  Name: Chet Mehta   Title: Vice President, Finance GUARANTORS LISTED ON
APPENDIX A By:  

/s/ Chet Mehta

  Name: Chet Mehta   Title: Vice President, Finance of each of (i) the
Guarantors set forth on Appendix A hereto that is a corporation, (ii) the sole
or managing member of each of the Guarantors set forth on Appendix A hereto that
is a limited liability company and (iii) the general partner of each of HOUSTON
KIDNEY CENTER/TOTAL RENAL CARE INTEGRATED SERVICE NETWORK LIMITED PARTNERSHIP,
TOTAL RENAL CARE TEXAS LIMITED PARTNERSHIP and RENAL TREATMENT CENTERS -
SOUTHEAST, LP, which is the sole or managing member of GREENSPOINT DIALYSIS, LLC
GUARANTORS LISTED ON APPENDIX B By:  

/s/ Steven I. Grieger

  Name: Steven I. Grieger   Title: Treasurer of each of (i) the Guarantors set
forth on Appendix B hereto and (ii) the sole or managing member of PHYSICIANS
MANAGEMENT, LLC, which is the sole or managing member of PHYSICIANS CHOICE
DIALYSIS, LLC, which is the sole or managing member of PHYSICIANS CHOICE
DIALYSIS OF ALABAMA, LLC

 

S-1

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THE DAVITA COLLECTION, INC. By:   /s/ Rebecca Steinfort   Name: Rebecca
Steinfort   Title: Treasurer DNP MANAGEMENT COMPANY, LLC By:   /s/ John Strack  
Name: John Strack   Title: President, Secretary and Treasurer

 

S-2

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JPMORGAN CHASE BANK, N.A., as Administrative Agent and Collateral Agent

By:  

/s/ Dawn Lee Lum

  Name: Dawn Lee Lum   Title: Executive Director

 

S-3

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APPENDIX A

Alamosa Dialysis, LLC

Carroll County Dialysis Facility, Inc.

Continental Dialysis Center, Inc.

Continental Dialysis Center of Springfield-Fairfax, Inc.

DaVita Rx, LLC

DaVita—West, LLC

Dialysis Holdings, Inc.

Dialysis Specialists of Dallas, Inc.

Downriver Centers, Inc.

DVA Healthcare of Maryland, Inc.

DVA Healthcare of Massachusetts, Inc.

DVA Healthcare of Pennsylvania, Inc.

DVA Healthcare Procurement Services, Inc.

DVA Healthcare Renal Care, Inc.

DVA Laboratory Services, Inc.

DVA of New York, Inc.

DVA Renal Healthcare, Inc.

East End Dialysis Center, Inc.

Elberton Dialysis Facility, Inc.

Flamingo Park Kidney Center, Inc.

Fort Dialysis, LLC

Freehold Artificial Kidney Center, L.L.C.

Hills Dialysis, LLC

Kidney Care Services, LLC

Lincoln Park Dialysis Services, Inc.

Maple Grove Dialysis, LLC

Mason-Dixon Dialysis Facilities, Inc.

Nephrology Medical Associates of Georgia, LLC

Neptune Artificial Kidney Center, L.L.C.

New Hope Dialysis, LLC

North Atlanta Dialysis Center, LLC

North Colorado Springs Dialysis, LLC

Palo Dialysis, LLC

Patient Pathways, LLC

Physicians Dialysis Acquisitions, Inc.

Renal Life Link, Inc.

Renal Treatment Centers—California, Inc.

Renal Treatment Centers—Hawaii, Inc.

Renal Treatment Centers—Illinois, Inc.

Renal Treatment Centers, Inc.

Renal Treatment Centers—Mid-Atlantic, Inc.

Renal Treatment Centers—Northeast, Inc.

Renal Treatment Centers—West, Inc.

RMS Lifeline Inc.

 

Appendix A-1

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

Rocky Mountain Dialysis Services, LLC

Total Acute Kidney Care, Inc.

Total Renal Care, Inc.

Total Renal Laboratories, Inc.

Total Renal Research, Inc.

TRC of New York, Inc.

Shining Star Dialysis, Inc.

Sierra Rose Dialysis Center, LLC

Southwest Atlanta Dialysis Centers, LLC

TRC—Indiana, LLC

Tree City Dialysis, LLC

VillageHealth DM, LLC

Westview Dialysis, LLC

 

Appendix A-2

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

APPENDIX B

DaVita of New York, Inc.

Knickerbocker Dialysis, Inc.

Liberty RC, Inc.

TRC West, Inc.

Physicians Dialysis, Inc.

Physicians Dialysis Ventures, Inc.

 

Appendix B-1

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

Preliminary Statements

The schedules that follow (the “Disclosure Schedules”) are being delivered
pursuant to that certain Credit Agreement (the “Credit Agreement”), dated as of
October 20, 2010, among DaVita Inc., a Delaware corporation (the “Borrower”),
the Guarantors party thereto, the several banks and other financial institutions
or entities from time to time Lenders thereunder, Bank of America, N.A., as
Syndication Agent, and JPMorgan Chase Bank, N.A., as Administrative Agent and
Collateral Agent (the “Administrative Agent”). Capitalized terms used but not
defined herein and in the Disclosure Schedules shall have the meanings given
such terms in the Credit Agreement.

Each of the Schedules in the Disclosure Schedules relates to the corresponding
Section of the Credit Agreement and the representations, warranties and
covenants set forth therein to which such Section relates. Headings have been
inserted for convenience of reference only and shall to no extent have the
effect of amending or changing the express descriptions of the sections of the
Credit Agreement or the language of the provisions thereof.

Matters set forth in the Disclosure Schedules are not necessarily limited to the
matters required by the Credit Agreement to be disclosed in the Disclosure
Schedules. Such additional matters are set forth for informational purposes only
and do not necessarily include other matters of a similar nature. In no event
shall the inclusion of any matter in the Disclosure Schedules be deemed or
interpreted to broaden the representations, warranties, covenants or agreements
contained in the Credit Agreement with respect to any party hereto. Furthermore,
by listing any matter on a Disclosure Schedule, the Loan Parties shall not be
deemed to have established any materiality standard, admitted any liability, or
concluded that any one or more of such matters are material.

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SCHEDULE 1.1

Existing Letters of Credit

 

Beneficiary

  

Identifying

Number

  

Issuing Bank

   Outstanding Amount   National Union Fire Insurance Co. of Pittsburgh PA   
TS-07002067    Credit Suisse First Boston    $ 8,920,000    National Union Fire
Insurance Co. of Pittsburgh PA    TS-07002188    Credit Suisse First Boston    $
14,100,000    American Casualty Company of Reading Pennsylvania    TPTS-206601
   JPMorgan Chase Bank, N.A.    $ 338,000    SCAN Health Plan    TPTS-207249   
JPMorgan Chase Bank, N.A.    $ 1,000,000    National Union Fire Insurance Co. of
Pittsburgh PA    TS-07004309    JPMorgan Chase Bank, N.A.    $ 1,500,000   
Citizens Bank of Pennsylvania    TPTS-639299    JPMorgan Chase Bank, N.A.    $
3,000,000    Equastone Raven LLC    S-645489    JPMorgan Chase Bank, N.A.    $
900,000    Natl Union Fire Ins Co Pittsburgh & others    JPM TPTS-683015   
JPMorgan Chase Bank, N.A.    $ 3,900,000    Natl Union Fire Ins Co Pittsburgh &
others    JPM TPTS-759411    JPMorgan Chase Bank, N.A.    $ 5,000,000         
     Total: $38,658,000   

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SCHEDULE 1.2

Mandatory Cost Formulae

 

1. The Mandatory Cost (to the extent applicable) is an addition to the interest
rate to compensate the Alternative Currency Revolving Lenders for the cost of
compliance with:

 

  (a) the requirements of the Bank of England and/or the Financial Services
Authority (or, in either case, any other authority which replaces all or any of
its functions); or

 

  (b) the requirements of the European Central Bank.

 

2. On the first day of each Interest Period (or as soon as possible thereafter)
the Administrative Agent shall calculate, as a percentage rate, a rate (the
“Additional Cost Rate”) for each Alternative Currency Revolving Lender, in
accordance with the paragraphs set out below. The Mandatory Cost will be
calculated by the Administrative Agent as a weighted average of the Alternative
Currency Revolving Lenders’ Additional Cost Rates (weighted in proportion to the
percentage participation of each Alternative Currency Revolving Lender in the
relevant Alternative Currency Revolving Loan) and will be expressed as a
percentage rate per annum. The Administrative Agent will, at the request of the
Company or any Alternative Currency Revolving Lender, deliver to the Company or
such Alternative Currency Revolving Lender as the case may be, a statement
setting forth the calculation of any Mandatory Cost.

 

3. The Additional Cost Rate for any Alternative Currency Revolving Lender
lending from a Lending Office in a Participating Member State will be the
percentage notified by that Alternative Currency Revolving Lender to the
Administrative Agent. This percentage will be certified by such Alternative
Currency Revolving Lender in its notice to the Administrative Agent to be its
reasonable determination of the cost (expressed as a percentage of such
Alternative Currency Revolving Lender’s participation in all Alternative
Currency Revolving Loans made from such Lending Office) of complying with the
minimum reserve requirements of the European Central Bank in respect of
Alternative Currency Revolving Loans made from that Lending Office.

 

4. The Additional Cost Rate for any Alternative Currency Revolving Lender
lending from a Lending Office in the United Kingdom will be calculated by the
Administrative Agent as follows:

 

  (a) in relation to any Alternative Currency Revolving Loan in Sterling:

 

AB+C(B-D)+E x 0.01

  per cent per annum

100 - (A+C)        

 

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

  (b) in relation to any Alternative Currency Revolving Loan in any currency
other than Sterling:

 

        E x 0.01        

  per cent per annum

300            

 

Where:

 

  “A” is the percentage of Eligible Liabilities (assuming these to be in excess
of any stated minimum) which that Alternative Currency Revolving Lender is from
time to time required to maintain as an interest free cash ratio deposit with
the Bank of England to comply with cash ratio requirements.

 

  “B” is the percentage rate of interest (excluding the Applicable Margin, the
Mandatory Cost and any interest charged on overdue amounts pursuant to the first
sentence of Section 2.14(c) and, in the case of interest (other than on overdue
amounts) charged at the Default Rate, without counting any increase in interest
rate effected by the charging of the Default Rate) payable for the relevant
Interest Period of such Alternative Currency Revolving Loan.

 

  “C” is the percentage (if any) of Eligible Liabilities which that Alternative
Currency Revolving Lender is required from time to time to maintain as interest
bearing Special Deposits with the Bank of England.

 

  “D” is the percentage rate per annum payable by the Bank of England to the
Administrative Agent on interest bearing Special Deposits.

 

  “E” is designed to compensate the Alternative Currency Revolving Lenders for
amounts payable under the Fees Rules and is calculated by the Administrative
Agent as being the average of the most recent rates of charge supplied by the
Alternative Currency Revolving Lenders to the Administrative Agent pursuant to
paragraph 7 below and expressed in pounds per £1,000,000.

 

5. For the purposes of this Schedule:

 

  (a) “Default Rate” means the highest rate set forth in each column of the
Pricing Grid.

 

  (b) “Eligible Liabilities” and “Special Deposits” have the meanings given to
them from time to time under or pursuant to the Bank of England Act 1998 or (as
may be appropriate) by the Bank of England;

 

  (c) “Fees Rules” means the rules on periodic fees contained in the FSA
Supervision Manual or such other law or regulation as may be in force from time
to time in respect of the payment of fees for the acceptance of deposits;

 

  (d) “Fee Tariffs” means the fee tariffs specified in the Fees Rules under the
activity group A.1 Deposit acceptors (ignoring any minimum fee or zero rated fee
required pursuant to the Fees Rules but taking into account any applicable
discount rate); and

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

  (e) “Tariff Base” has the meaning given to it in, and will be calculated in
accordance with, the Fees Rules.

 

6. In application of the above formulae, A, B, C and D will be included in the
formulae as percentages (i.e. 5% will be included in the formula as 5 and not as
0.05). A negative result obtained by subtracting D from B shall be taken as
zero. The resulting figures shall be rounded to four decimal places.

 

7. If requested by the Administrative Agent or the Company, each Alternative
Currency Revolving Lender with a Lending Office in the United Kingdom or a
Participating Member State shall, as soon as practicable after publication by
the Financial Services Authority, supply to the Administrative Agent and the
Company, the rate of charge payable by such Alternative Currency Revolving
Lender to the Financial Services Authority pursuant to the Fees Rules in respect
of the relevant financial year of the Financial Services Authority (calculated
for this purpose by such Alternative Currency Revolving Lender as being the
average of the Fee Tariffs applicable to such Alternative Currency Revolving
Lender for that financial year) and expressed in pounds per £1,000,000 of the
Tariff Base of such Alternative Currency Revolving Lender.

 

8. Each Alternative Currency Revolving Lender shall supply any information
required by the Administrative Agent for the purpose of calculating its
Additional Cost Rate. In particular, but without limitation, each Alternative
Currency Revolving Lender shall supply the following information in writing on
or prior to the date on which it becomes an Alternative Currency Revolving
Lender:

 

  (a) the jurisdiction of the Lending Office out of which it is making available
its participation in the relevant Alternative Currency Revolving Loan; and

 

  (b) any other information that the Administrative Agent may reasonably require
for such purpose.

Each Alternative Currency Revolving Lender shall promptly notify the
Administrative Agent in writing of any change to the information provided by it
pursuant to this paragraph.

 

9. The percentages of each Alternative Currency Revolving Lender for the purpose
of A and C above and the rates of charge of each Alternative Currency Revolving
Lender for the purpose of E above shall be determined by the Administrative
Agent based upon the information supplied to it pursuant to paragraphs 7 and 8
above and on the assumption that, unless an Alternative Currency Revolving
Lender notifies the Administrative Agent to the contrary, each Alternative
Currency Revolving Lender’s obligations in relation to cash ratio deposits and
Special Deposits are the same as those of a typical bank from its jurisdiction
of incorporation with a lending office in the same jurisdiction as its Lending
Office.

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

10. The Administrative Agent shall have no liability to any Person if such
determination results in an Additional Cost Rate which over- or
under-compensates any Alternative Currency Revolving Lender and shall be
entitled to assume that the information provided by any Alternative Currency
Revolving Lender pursuant to paragraphs 3, 7 and 8 above is true and correct in
all respects.

 

11. The Administrative Agent shall distribute the additional amounts received as
a result of the Mandatory Cost to the Alternative Currency Revolving Lenders on
the basis of the Additional Cost Rate for each Alternative Currency Revolving
Lender based on the information provided by each Alternative Currency Revolving
Lender pursuant to paragraphs 3, 7 and 8 above.

 

12. Any determination by the Administrative Agent pursuant to this Schedule in
relation to a formula, the Mandatory Cost, an Additional Cost Rate or any amount
payable to an Alternative Currency Revolving Lender shall, in the absence of
manifest error, be conclusive and binding on all parties hereto.

 

13. The Administrative Agent may from time to time, after consultation with the
Company and the Alternative Currency Revolving Lenders, determine and notify to
all parties any amendments which are required to be made to this Schedule in
order to comply with any change in law, regulation or any requirements from time
to time imposed by the Bank of England, the Financial Services Authority or the
European Central Bank (or, in any case, any other authority which replaces all
or any of its functions) and any such determination shall, in the absence of
manifest error, be conclusive and binding on all parties hereto.

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

SCHEDULE 4.4

Consents, Authorizations, Filings and Notices

Receipt of the Required Consents and the execution of the New Supplemental
Indenture (as such terms are defined in the Offer to Purchase and Consent
Solicitation Statement by DaVita Inc. dated as of October 1, 2010), which will
be in full force and effect as of the Closing Date.

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

SCHEDULE 4.8

Real Property

1. The Group Members identified in the table below have fee simple ownership of
the real property located at each address set forth opposite their name below:

 

Group Member

 

Address

  

Leasing Status

Renal Treatment Centers-West, Inc.  

2645 W ELK

DUNCAN, OK 73533

   DVA Renal Healthcare, Inc.  

90 WASHINGTON ST, BASEMENT -

Condo Units 109-113

EAST ORANGE, NJ 07017

   DVA Renal Healthcare, Inc.  

1090 WEST MCKINLEY

DECATUR, IL 62526

   DVA Renal Healthcare, Inc.  

1515 WEST WALNUT

JACKSONVILLE, IL 62650

   DVA Healthcare Renal Care, Inc.  

2028 DABNEY RD – Condo

RICHMOND, VA 23230

   Llano Dialysis, LLC  

125 HOSPITAL DR

VALLEJO, CA 94589

   Total Renal Laboratories, Inc.  

1991 INDUSTRIAL DR

DELAND, FL 32724

   Renal Treatment Centers-Southeast, LP  

7515 BARLITE BLVD

SAN ANTONIO, TX 78224

   Leased Renal Life Link, Inc.  

2880 WEST AIRLINE HWY

LA PLACE, LA 70068

   DVA Healthcare Renal Care, Inc.  

1757 EAST MAIN ST

DOTHAN, AL 36301

   Leased DVA Healthcare Renal Care, Inc.  

125 E ARBOR VITAE

INGLEWOOD, CA 90301

   DVA Healthcare Renal Care, Inc.  

15 JOHN MADDOX DR

ROME, GA 30165

   DVA Renal Healthcare, Inc.  

1840 SOUTHERN LANE

DECATUR, GA 30033

   DVA Renal Healthcare, Inc.  

231 HILLCREST DR

CLARKSVILLE, TN 37403

   DVA Healthcare Renal Care, Inc.  

2920 TELEGRAPH AVENUE

BERKELEY, CA 94705

   DVA Healthcare of Massachusetts, Inc.  

322 WASHINGTON ST

BROOKLINE, MA 2146

   DVA Renal Healthcare, Inc.  

105 MICHAEL MARTIN RD

MT. OLIVE, NC 28365

   DVA Renal Healthcare, Inc.  

1265 ROCK CANYON RD

KATY, TX 77450

   DVA Healthcare Renal Care, Inc.  

214 E HOSPITAL AVE

OZARK, AL 36360

   Leased DVA Renal Healthcare, Inc.  

400 DECATUR ST

ATLANTA, GA 30312

  

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

Group Member

 

Address

  

Leasing Status

DVA Renal Healthcare, Inc.  

1704 WAYNE MEMORIAL DR

GOLDSBORO, NC 27534

   DVA Renal Healthcare, Inc.  

4632 W CENTURY BLVD

INGLEWOOD, CA 90304

   Leased DVA Renal Healthcare, Inc.  

400 CENTERVIEW BLVD

CRESTVIEW HILLS, KY 47017

   DVA Renal Healthcare, Inc.  

1705 GROVE ST

COLUMBIA, TN 38401

   DVA Healthcare Renal Care, Inc.  

308 1/2 CORDELL

EL DORADO, AR 71730

   DVA Healthcare Renal Care, Inc.  

1000 E PALMER AVE

GLENDALE, CA 91205

   DVA Healthcare Renal Care, Inc.  

29 IDLEWOOD BLVD HWY 250

STAUNTON, VA 24401

   DVA Healthcare Renal Care, Inc.  

2504 VALLEY RIDGE RD

COVINGTON, VA 24426

   DVA Healthcare Renal Care, Inc.  

1498 SOUTHGATE AVE

DALY CITY, CA 94015

   Leased DVA Healthcare Renal Care, Inc.   1625 DR MARTIN LUTHER KING DR
WINTERHAVEN, FL 33881    DVA Healthcare of Pennsylvania, Inc.  

248 ELM DR

WAYNESBURG, PA 15370

   DVA Healthcare Renal Care, Inc.  

5003 UMBRIA ST

PHILADELPHIA, PA 19127

   DaVita Inc. fka Total Renal Care Holdings, Inc.  

2000 16th ST

DENVER, CO 80202

  

2. The Group Members set forth on Schedule 2(c) to the Perfection Certificate
have a leasehold interest in the real property located at the address set forth
opposite their name in such Schedule 2(c) that is not identified in the table
above.

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

SCHEDULE 7.1(c)

Existing Liens

 

Juris

   Debtor   

Secured Party

   Orig File Date    Original File Number   

Collateral Description

SOS DE    Davita RX, LLC   

Amerisourcebergen

Drug Corporation

   02/11/2010    00458715   

All personal

property of the

debtor

NJ Superior Court    Shining Star
Dialysis, Inc.   

Julia Buzgo and

Sandor Buzgo

   Entered:
08/05/2003

Signed: 07/14/2003

   J 199474-03   

Award of

$25,000 for

damages and

costs

SOS TN    DVA Renal
Healthcare, Inc.   

Macquarie

Equipment Finance,

LLC

   03/28/08    208015423   

Specific leased

equipment

SOS TN    DVA Renal
Healthcare, Inc.   

Macquarie

Equipment Finance,

LLC

   04/06/09    309016462   

Specific leased

equipment

SOS DE    Physicians
Management, LLC    VAR Resources, Inc.    11/02/09    2009 3515076   

Specific leased

equipment

CA – Los

Angeles

County

   Physicians
Management, LLC   

State of California

Franchise Tax Board

   12/10/02    02-3021484    $4,616.46

CO –

Denver

County

   Renal Treatment
Centers – West,
Inc.   

Colorado

Department of Labor

and Employment

   08/25/03    2003179651    $543.89 SOS DE    DAVITA INC.   

Ballston Aero Trust

Services, L.C., as

Trustee

   07/01/02 and
continued
on 01/09/07    21602907   

12.5% interest

in specific

Aircraft and

engines

SOS DE    DAVITA INC.   

De Lage Landen

Financial Services,

Inc.

   11/02/05    53418440   

Specific leased

equipment

SOS DE    DAVITA INC.   

Greatamerica Leasing

Corporation

   11/18/05    53594349   

Specific leased

equipment

SOS DE    DAVITA INC.   

Greatamerica Leasing

Corporation

   01/30/06    60341750   

Specific leased

equipment

SOS DE    DAVITA INC.   

Michigan Heritage

Bank

   07/07/06    62346120   

Specific

equipment

SOS DE    DAVITA INC.    US Express Leasing, Inc.    12/12/06    64336558   

Specific leased

equipment

SOS DE    DAVITA INC.    US Bancorp    04/05/07    2007 1279362   

Specific

equipment

SOS DE    DAVITA INC.   

Banc of America

Leasing & Capital,

LLC

   12/13/07    200 47135577   

Specific

equipment

SOS DE    DAVITA INC.   

De Lage Landen

Financial Services, Inc.

   12/28/07    2007 4896980   

Specific leased

equipment

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

Juris

   Debtor   

Secured Party

   Orig File Date    Original File Number   

Collateral Description

SOS DE    DAVITA INC.    Wells Fargo Bank, N.A.    04/22/08    2008 1397908   

Specific

equipment

SOS DE    DAVITA INC.    Banc of America Leasing & Capital, Inc.    05/23/08   
2008 1794054   

Specific

equipment

SOS DE    DAVITA INC.    Wells Fargo Financial Leasing, Inc .    08/27/08   
2008 2913307   

Specific

equipment

SOS DE    DAVITA INC.    Canon Financial Services    09/26/08    2008 3282892   
Specific leased equipment SOS DE    DAVITA INC.    Ikon Financial Svcs   
11/20/08    2008 3875943    Specific leased equipment SOS DE    DAVITA INC.   
Canon Financial Services    06/02/09    2009 1738407    Specific leased
equipment SOS DE    DAVITA INC.    US Bancorp    08/16/10    2010 2864282   

Specific

equipment

SOS DE    DAVITA INC.    US Bancorp    10/24/09    2009 3420780   

Specific

equipment

CA – U.S.

Central

District

Court

   DAVITA, INC.    State of California    10/05/2005    Case No.
05CV07190    $85,000

CA – Los

Angeles

County

   DAVITA, INC.    Norman S. Wright/Aire Link    09/29/2005    Case No.
05-2354266    $15,311.17

CA – Los

Angeles

County

   DAVITA, INC.    California Commercial Wiring System, Inc.    08/13/2009   
Case No.
20091244762    $43,198.00

CA – Los

Angeles

County

   DAVITA, INC.    Goodwine Glass Co.    01/22/2010    Case No.
20100097374    $4,743.00

CA – Los

Angeles

County

   DAVITA, INC.    City of El Segundo    09/27/2004    Case No.
04-2479372   

Easement on

real property in

El Segundo

SOS CA    Total Renal

Care, Inc.

   Macquarie Equipment Finance, LLC    03/27/08    087152082265    Specific
leased equipment

GA –

Cooperative Authority

   Nephrology
Medical

Associates of

Georgia, LLC

   General Electric Capital Corporation    07/10/06    067-2006-006983   
Specific leased equipment SOS DE    Renal

Treatment

Centers-

Southeast LP

   Macquarie Equipment Finance, LLC    03/27/08    2008 1075983    Specific
leased equipment SOS DE    Renal

Treatment

Centers-

Southeast LP

   Macquarie Equipment Finance, LLC    10/10/08    2008 3432158    Specific
leased equipment

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

Juris

   Debtor   

Secured Party

   Orig File Date    Original File Number   

Collateral Description

SOS DE    Renal Treatment
Centers-Southeast
LP   

Macquarie

Equipment Finance,

LLC

   04/22/09    2009 1270088   

Specific leased

equipment

SOS Florida    DVA Laboratory
Services, Inc.    Siemens Healthcare Diagnostics Inc.    03/22/10   
201002208422   

Specific

equipment

SOS Florida    Total Renal
Laboratories, Inc.   

Beckman Coulter

Capital

   12/16/02    200202860270   

Specific leased

equipment

SOS Florida    Total Renal
Laboratories, Inc.   

Beckman Coulter

Capital

   12/16/02    200202860289   

Specific leased

equipment

SOS Florida    Total Renal
Laboratories, Inc.    Leaf Funding, Inc.    09/24/04    200407942562   

Specific

equipment

And all Liens securing Debt set forth on Schedule 7.2(b) to the extent secured
by a Lien as of the Closing Date.

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

SCHEDULE 7.2(b)

Existing Debt

 

Bank / Institution

  

Entity

  

Type

   Balance as of
9/30/2010  

[DELETED]

   [DELETED]    Note    $ 500,000   

[DELETED]

   [DELETED]    Lease    $ 561,369   

[DELETED]

   [DELETED]    Note    $ 6,000,000   

[DELETED]

   [DELETED]    Lease    $ 1,137,898   

EHP LLC

   RMS Lifeline Inc.    Lease    $ 31,231   

Various

   Various    Capital leases    $ 6,956,324   

Lawrence J. Centella

   DaVita Inc.    Deferred purchase    $ 1,000,000   

Open Access Vascular Access Center, Inc.

   RMS Lifeline Inc.    Deferred purchase    $ 1,200,000   

Gateway Home Dialysis, Inc.

   Total Renal Care, Inc.    Deferred purchase    $ 50,000   

West Penn Allegheny Health System, Inc.

   Total Renal Care, Inc.    Deferred purchase    $
21,984
  

Nordea Bank, New York

   Pacific Employers Insurance Company (beneficiary)    Letter of credit    $
7,231,460                            $ 24,690,266   

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

SCHEDULE 7.6

Investments

Investments in other entities (50% or Less)

 

Partnership

   Ownership    Balance as of
9/30/2010  

Total Renal Care / Crystal River Dialysis , L.C.

   33.3%    $ 233,317   

Southwest Kidney-DaVita Dialysis Partners, LLC

   50%    $ 19,986,633   

Routt Dialysis, LLC

   40%    $ 4,714,713   

MD Investments, L.L.C.

   50.1%    $ 445,797   

MHS-XV, LLC (IHS of New York, Inc.)

   15%    $ 135,226   

MHS-XIV,LLC (IHS of New York, Inc.)

   15%    $ 163,395                   TOTAL:    $ 25,679,081   

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

EXHIBIT A

 

 

 

SECURITY AGREEMENT

By

DaVita Inc.,

as Borrower

and

THE GUARANTORS PARTY HERETO

and

JPMorgan Chase Bank, N.A.,

as Collateral Agent

 

 

Dated as of October 20, 2010

 

 

 

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

TABLE OF CONTENTS

 

         Page   PREAMBLE        1    RECITALS        1    AGREEMENT        2   

ARTICLE I

  

DEFINITIONS AND INTERPRETATION

  

SECTION 1.1.   DEFINITIONS      2    SECTION 1.2.   INTERPRETATION      8   
SECTION 1.3.   RESOLUTION OF DRAFTING AMBIGUITIES      8    SECTION 1.4.  
PERFECTION CERTIFICATE      8   

ARTICLE II

  

GRANT OF SECURITY AND SECURED OBLIGATIONS

  

SECTION 2.1.   GRANT OF SECURITY INTEREST      8    SECTION 2.2.   FILINGS     
9   

ARTICLE III

  

PERFECTION; SUPPLEMENTS; FURTHER ASSURANCES;

  

USE OF PLEDGED COLLATERAL

  

SECTION 3.1.   DELIVERY OF CERTIFICATED SECURITIES COLLATERAL      10    SECTION
3.2.   PERFECTION OF UNCERTIFICATED SECURITIES COLLATERAL      10    SECTION
3.3.  

FINANCING STATEMENTS AND OTHER FILINGS; MAINTENANCE OF PERFECTED SECURITY
INTEREST

     11    SECTION 3.4.   OTHER ACTIONS      11    SECTION 3.5.   JOINDER OF
ADDITIONAL GUARANTORS      14    SECTION 3.6.   SUPPLEMENTS; FURTHER ASSURANCES
     14   

ARTICLE IV

  

REPRESENTATIONS, WARRANTIES AND COVENANTS

  

SECTION 4.1.   TITLE      15    SECTION 4.2.   VALIDITY OF SECURITY INTEREST   
  15    SECTION 4.3.   DEFENSE OF CLAIMS; TRANSFERABILITY OF PLEDGED COLLATERAL
     15    SECTION 4.4.   OTHER FINANCING STATEMENTS      16    SECTION 4.5.  
CHIEF EXECUTIVE OFFICE; CHANGE OF NAME; JURISDICTION OF ORGANIZATION      16   
SECTION 4.6.   LOCATION OF INVENTORY AND EQUIPMENT      16   

 

-i-

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

         Page   SECTION 4.7.   DUE AUTHORIZATION AND ISSUANCE      16    SECTION
4.8.   CONSENTS, ETC      16    SECTION 4.9.   PLEDGED COLLATERAL      17   
SECTION 4.10.   INSURANCE      17   

ARTICLE V

  

CERTAIN PROVISIONS CONCERNING SECURITIES COLLATERAL    SECTION 5.1.   PLEDGE OF
ADDITIONAL SECURITIES COLLATERAL      17    SECTION 5.2.   VOTING RIGHTS;
DISTRIBUTIONS; ETC      17    SECTION 5.3.   DEFAULTS, ETC      18    SECTION
5.4.  

CERTAIN AGREEMENTS OF PLEDGORS AS ISSUERS AND HOLDERS OF EQUITY INTERESTS

     19   

ARTICLE VI

  

CERTAIN PROVISIONS CONCERNING INTELLECTUAL

  

PROPERTY COLLATERAL

  

SECTION 6.1.   GRANT OF INTELLECTUAL PROPERTY LICENSE      19    SECTION 6.2.  
PROTECTION OF COLLATERAL AGENT’S SECURITY      19    SECTION 6.3.  
AFTER-ACQUIRED PROPERTY      20    SECTION 6.4.   LITIGATION      20   

ARTICLE VII

  

CERTAIN PROVISIONS CONCERNING RECEIVABLES

  

SECTION 7.1.   MAINTENANCE OF RECORDS      21    SECTION 7.2.   LEGEND      21
   SECTION 7.3.   MODIFICATION OF TERMS, ETC      21    SECTION 7.4.  
COLLECTION      21   

ARTICLE VIII

  

TRANSFERS

  

SECTION 8.1.   TRANSFERS OF PLEDGED COLLATERAL      22   

ARTICLE IX

  

REMEDIES

  

SECTION 9.1.   REMEDIES      22    SECTION 9.2.   NOTICE OF SALE      24   
SECTION 9.3.   WAIVER OF NOTICE AND CLAIMS      24    SECTION 9.4.   CERTAIN
SALES OF PLEDGED COLLATERAL      24    SECTION 9.5.   NO WAIVER; CUMULATIVE
REMEDIES      25   

 

-ii-

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

         Page   SECTION 9.6.   CERTAIN ADDITIONAL ACTIONS REGARDING INTELLECTUAL
PROPERTY      26   

ARTICLE X

  

APPLICATION OF PROCEEDS

  

SECTION 10.1.   APPLICATION OF PROCEEDS      26   

ARTICLE XI

  

MISCELLANEOUS

  

SECTION 11.1.   CONCERNING COLLATERAL AGENT      26    SECTION 11.2.  

COLLATERAL AGENT MAY PERFORM; COLLATERAL AGENT APPOINTED ATTORNEY-IN-FACT

     27    SECTION 11.3.   CONTINUING SECURITY INTEREST; ASSIGNMENT      28   
SECTION 11.4.   TERMINATION; RELEASE      28    SECTION 11.5.   MODIFICATION IN
WRITING      29    SECTION 11.6.   NOTICES      29    SECTION 11.7.  

GOVERNING LAW, CONSENT TO JURISDICTION AND SERVICE OF PROCESS; WAIVER OF JURY
TRIAL

     29    SECTION 11.8.   SEVERABILITY OF PROVISIONS      29    SECTION 11.9.  
EXECUTION IN COUNTERPARTS      29    SECTION 11.10.   BUSINESS DAYS      29   
SECTION 11.11.   NO CREDIT FOR PAYMENT OF TAXES OR IMPOSITION      29    SECTION
11.12.   NO CLAIMS AGAINST COLLATERAL AGENT      30    SECTION 11.13.   NO
RELEASE      30    SECTION 11.14.   OBLIGATIONS ABSOLUTE      30    SIGNATURES  
     S-1   

 

EXHIBIT 1   Form of Issuer’s Acknowledgment EXHIBIT 2   Form of Securities
Pledge Amendment EXHIBIT 3   Form of Joinder Agreement EXHIBIT 4   Form of
Control Agreement Concerning Securities Accounts EXHIBIT 5   Form of Control
Agreement Concerning Deposit Accounts EXHIBIT 6   Form of Copyright Security
Agreement EXHIBIT 7   Form of Patent Security Agreement EXHIBIT 8   Form of
Trademark Security Agreement

 

-iii-

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

SECURITY AGREEMENT

This SECURITY AGREEMENT dated as of October 20, 2010 (as amended, amended and
restated, supplemented or otherwise modified from time to time in accordance
with the provisions hereof, this “Agreement”) is made by DaVita Inc., a Delaware
corporation (the “Borrower”), and the Guarantors from to time to time party
hereto (the “Guarantors”), as pledgors, assignors and debtors (the Borrower,
together with the Guarantors, in such capacities and together with any
successors in such capacities, the “Pledgors,” and each, a “Pledgor”), in favor
of JPMorgan Chase Bank, N.A., in its capacity as collateral agent pursuant to
the Credit Agreement (as hereinafter defined), as pledgee, assignee and secured
party (in such capacities and together with any successors in such capacities,
the “Collateral Agent”).

R E C I T A L S :

A. The Borrower, the Guarantors, the Collateral Agent and the lending
institutions listed therein (the “Lenders”) have, in connection with the
execution and delivery of this Agreement, entered into that certain credit
agreement, dated as of October 20, 2010 (as amended, amended and restated,
supplemented or otherwise modified from time to time, the “Credit Agreement”;
which term shall also include and refer to any increase in the amount of
indebtedness under the Credit Agreement and any refinancing or replacement of
the Credit Agreement (whether under a bank facility, securities offering or
otherwise) or one or more successor or replacement facilities whether or not
with a different group of agents or lenders (whether under a bank facility,
securities offering or otherwise) and whether or not with different obligors
upon the Administrative Agent’s acknowledgment of the termination of the
predecessor Credit Agreement).

B. Each Guarantor has, pursuant to the Credit Agreement, unconditionally
guaranteed the Secured Obligations.

C. The Borrower and each Guarantor will receive substantial benefits from the
execution, delivery and performance of the obligations under the Credit
Agreement and the other Loan Documents and each is, therefore, willing to enter
into this Agreement.

D. This Agreement is given by each Pledgor in favor of the Collateral Agent for
the benefit of the Secured Parties (as hereinafter defined) to secure the
payment and performance of all of the Secured Obligations.

F. It is a condition to (i) the obligations of the Lenders to make the Loans
under the Credit Agreement and (ii) the obligations of the Issuing Lender to
issue Letters of Credit and (iii) the performance of the obligations of the
Secured Parties under Specified Swap Agreements and Secured Cash Management
Agreements that constitute Secured Obligations that each Pledgor execute and
deliver the applicable Loan Documents, including this Agreement.

A G R E E M E N T :

NOW THEREFORE, in consideration of the foregoing premises and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, each Pledgor and the Collateral Agent hereby agree as follows:

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

ARTICLE I

DEFINITIONS AND INTERPRETATION

SECTION 1.1. Definitions.

(a) Unless otherwise defined herein or in the Credit Agreement, capitalized
terms used herein that are defined in the UCC shall have the meanings assigned
to them in the UCC; provided that in any event, the following terms shall have
the meanings assigned to them in the UCC:

“Accounts”; “Bank”; “Chattel Paper”; “Commercial Tort Claim”; “Commodity
Account”; “Commodity Contract”; “Commodity Intermediary”; “Documents”;
“Electronic Chattel Paper”; “Entitlement Order”; “Equipment”; “Financial Asset”;
“Fixtures”; “Goods”, “Inventory”; “Letter-of-Credit Rights”; “Letters of
Credit”; “Money”; “Payment Intangibles”; “Proceeds”; “ Records”; “Securities
Account”; “Securities Intermediary”; “Security Entitlement”; “Supporting
Obligations”; and “Tangible Chattel Paper.”

(b) Terms used but not otherwise defined herein that are defined in the Credit
Agreement shall have the meanings given to them in the Credit Agreement.
Sections 1.3 and 1.5 of the Credit Agreement shall apply herein mutatis
mutandis.

(c) The following terms shall have the following meanings:

“Account Debtor” shall mean each person who is obligated on a Receivable or
Supporting Obligation related thereto.

“Agreement” shall have the meaning assigned to such term in the Preamble hereof.

“Bankruptcy Code” shall mean Title 11 of the United States Code, or any other
law of the United States that from time to time provides a uniform system of
bankruptcy laws.

“Borrower” shall have the meaning assigned to such term in the Preamble hereof.

“Collateral Agent” shall have the meaning assigned to such term in the Preamble
hereof.

“Collateral Support” shall mean all property (real or personal) assigned,
hypothecated or otherwise securing any Pledged Collateral and shall include any
security agreement or other agreement granting a lien or security interest in
such real or personal property.

“Commodity Account Control Agreement” shall mean a control agreement in a form
that is reasonably satisfactory to the Administrative Agent establishing the
Collateral Agent’s Control with respect to any Commodity Account.

“Contracts” shall mean, collectively, with respect to each Pledgor, all sale,
service, performance, equipment or property lease contracts, agreements and
grants and all other contracts, agreements or grants (in each case, whether
written or oral, or third party or intercompany), between such Pledgor and any
third party, and all assignments, amendments, restatements, supplements,
extensions, renewals, replacements or modifications thereof.

 

-2-

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

“Control” shall mean (i) in the case of each Deposit Account, “control,” as such
term is defined in Section 9-104 of the UCC, (ii) in the case of any Security
Entitlement, “control,” as such term is defined in Section 8-106 of the UCC, and
(iii) in the case of any Commodity Contract, “control,” as such term is defined
in Section 9-106 of the UCC.

“Control Agreements” shall mean, collectively, the Deposit Account Control
Agreement, the Securities Account Control Agreement and the Commodity Account
Control Agreement.

“Copyrights” shall mean, collectively, with respect to each Pledgor, (a) each
copyright registration and application registered with the United States
Copyright Office and (b) each other material copyright (whether statutory or
common law, whether established or registered in the United States or any other
country or any political subdivision thereof, whether registered or unregistered
and whether published or unpublished) and all copyright registrations and
applications made by such Pledgor, in each case, whether now owned or hereafter
created or acquired by or assigned to such Pledgor, together with any and all
(i) rights and privileges arising under applicable law with respect to such
Pledgor’s use of such copyrights, (ii) reissues, renewals, continuations and
extensions thereof and amendments thereto, (iii) income, fees, royalties,
damages, claims and payments now or hereafter due and/or payable with respect
thereto, including damages and payments for past, present or future
infringements thereof, (iv) rights corresponding thereto throughout the world
and (v) rights to sue for past, present or future infringements thereof.

“Copyright Security Agreement” shall mean an agreement substantially in the form
of Exhibit 6 hereto.

“Credit Agreement” shall have the meaning assigned to such term in Recital A
hereof.

“Deposit Account Control Agreement” shall mean an agreement substantially in the
form of Exhibit 5 hereto or such other form that is reasonably satisfactory to
the Collateral Agent establishing the Collateral Agent’s Control with respect to
any Deposit Account.

“Deposit Accounts” shall mean, collectively, with respect to each Pledgor,
(i) all “deposit accounts” as such term is defined in the UCC and in any event
shall include the LC Account and all accounts and sub-accounts relating to any
of the foregoing accounts and (ii) all cash, funds, checks, notes and
instruments from time to time on deposit in any of the accounts or sub-accounts
described in clause (i) of this definition.

“Distributions” shall mean, collectively, with respect to each Pledgor, all
dividends, cash, options, warrants, rights, instruments, distributions, returns
of capital or principal, income, interest, profits and other property, interests
(debt or equity) or proceeds, including as a result of a split, revision,
reclassification or other like change of the Pledged Securities, from time to
time received, receivable or otherwise distributed to such Pledgor in respect of
or in exchange for any or all of the Pledged Securities or Intercompany Notes.

“Excluded Deposit Accounts” shall have the meaning assigned to such term in
Section 3.4(b) hereof.

“Excluded Property” shall mean

(a) any permit or license issued by a Governmental Authority to any Pledgor or
any agreement, Contract or Intellectual Property License, including any
agreement with a Govermental

 

-3-

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

Authority, to which any Pledgor is a party, in each case, only to the extent and
for so long as the terms of such permit, license, Contract or Intellectual
Property License or any Requirement of Law applicable thereto, validly prohibit
the creation by such Pledgor of a security interest in such permit, license,
Contract or Intellectual Property License in favor of the Collateral Agent
(after giving effect to Sections 9-406(d), 9-407(a), 9-408(a) or 9-409 of the
UCC (or any successor provision or provisions) or any other applicable law);

(b) Real Property or Equipment owned by any Pledgor on the date hereof or
hereafter acquired that is subject to a Lien securing Debt incurred pursuant to
Section 7.2(e) of the Credit Agreement or Capitalized Lease Obligation permitted
to be incurred pursuant to the provisions of the Credit Agreement if the
contract or other agreement in which such Lien is granted (or the documentation
providing for such Debt incurred pursuant to Section 7.2(e) of the Credit
Agreement or Capitalized Lease Obligation) validly prohibits the creation of any
other Lien on such Real Property or Equipment; and

(c) Voting Interests of any Foreign Subsidiary in excess of 65% of the total
voting power of all outstanding Voting Interests of such Foreign Subsidiary;

provided, however, that Excluded Property shall not include any Proceeds,
substitutions or replacements of any Excluded Property referred to in clause
(a) or (b) (unless such Proceeds, substitutions or replacements would constitute
Excluded Property referred to in clause (a) or (b)).

“Excluded Securities/Commodity Accounts” shall have the meaning assigned to such
term in Section 3.4(c) hereof.

“General Intangibles” shall mean, collectively, with respect to each Pledgor,
all “general intangibles,” as such term is defined in the UCC, of such Pledgor
and, in any event, shall include (i) all of such Pledgor’s rights, title and
interest in, to and under all Contracts and insurance policies (including all
rights and remedies relating to monetary damages, including indemnification
rights and remedies, and claims for damages or other relief pursuant to or in
respect of any Contract), (ii) all know-how and warranties relating to any of
the Pledged Collateral or the Mortgaged Property, (iii) any and all other
rights, claims, choses-in-action and causes of action of such Pledgor against
any other person and the benefits of any and all collateral or other security
given by any other person in connection therewith, (iv) all guarantees,
endorsements and indemnifications on, or of, any of the Pledged Collateral or
any of the Mortgaged Property, (v) all lists, books, records, correspondence,
ledgers, printouts, files (whether in printed form or stored electronically),
tapes and other papers or materials containing information relating to any of
the Pledged Collateral or any of the Mortgaged Property, including all customer
or tenant lists, identification of suppliers, data, plans, blueprints,
specifications, designs, drawings, appraisals, recorded knowledge, surveys,
studies, engineering reports, test reports, manuals, standards, processing
standards, performance standards, catalogs, research data, computer and
automatic machinery software and programs and the like, field repair data,
accounting information pertaining to such Pledgor’s operations or any of the
Pledged Collateral or any of the Mortgaged Property and all media in which or on
which any of the information or knowledge or data or records may be recorded or
stored and all computer programs used for the compilation or printout of such
information, knowledge, records or data, (vi) all licenses, consents, permits,
variances, certifications, authorizations and approvals, however characterized,
now or hereafter acquired or held by such Pledgor, including building permits,
certificates of occupancy, environmental certificates, industrial permits or
licenses and certificates of operation and (vii) all rights to reserves,
deferred payments, deposits, refunds, indemnification of claims and claims for
tax or other refunds against any Governmental Authority.

 

-4-

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

“Goodwill” shall mean, collectively, with respect to each Pledgor, the goodwill
connected with such Pledgor’s business including all goodwill connected with
(i) the use of and symbolized by any Trademark or Intellectual Property License
with respect to any Trademark in which such Pledgor has any interest, (ii) all
know-how, trade secrets, customer and supplier lists, proprietary information,
inventions, methods, procedures, formulae, descriptions, compositions, technical
data, drawings, specifications, name plates, catalogs, confidential information
and the right to limit the use or disclosure thereof by any person, pricing and
cost information, business and marketing plans and proposals, consulting
agreements, engineering contracts and such other assets which relate to such
goodwill and (iii) all product lines of such Pledgor’s business.

“Government Reimbursement Programs” shall mean the Medicare programs and the
Medicaid programs and Tricare programs in which the Pledgors participate
(together with their respective intermediaries or carriers).

“Guarantors” shall have the meaning assigned to such term in the Preamble
hereof.

“Instruments” shall mean, collectively, with respect to each Pledgor, all
“instruments,” as such term is defined in Article 9, rather than Article 3, of
the UCC, and shall include all promissory notes, drafts, bills of exchange or
acceptances.

“Intellectual Property Collateral” shall mean, collectively, the Patents,
Trademarks, Copyrights, Intellectual Property Licenses and Goodwill.

“Intellectual Property Licenses” shall mean, collectively, with respect to each
Pledgor, all license and distribution agreements with, and covenants not to sue,
any other party with respect to any Patent, Trademark or Copyright or any other
patent, trademark or copyright, whether such Pledgor is a licensor or licensee,
distributor or distributee under any such license or distribution agreement,
together with any and all (i) renewals, extensions, supplements and
continuations thereof, (ii) income, fees, royalties, damages, claims and
payments now and hereafter due and/or payable thereunder and with respect
thereto including damages and payments for past, present or future infringements
or violations thereof, (iii) rights to sue for past, present and future
infringements or violations thereof and (iv) other rights to use, exploit or
practice any or all of the Patents, Trademarks or Copyrights or any other
patent, trademark or copyright.

“Intercompany Notes” shall mean, with respect to each Pledgor, all intercompany
notes described in Schedule 11 to the Perfection Certificate and intercompany
notes hereafter acquired by such Pledgor and all certificates, instruments or
agreements evidencing such intercompany notes, and all assignments, amendments,
restatements, supplements, extensions, renewals, replacements or modifications
thereof to the extent permitted pursuant to the terms hereof.

“Investment Property” shall mean a security, whether certificated or
uncertificated, Security Entitlement, Securities Account, Commodity Contract or
Commodity Account, excluding, however, the Securities Collateral.

“Joinder Agreement” shall mean an agreement substantially in the form of
Exhibit 3 hereto.

“LC Account” shall mean any account established and maintained in accordance
with the provisions of Section 3.10 of the Credit Agreement and all property
from time to time on deposit in such LC Account.

 

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“Lenders” shall have the meaning assigned to such term in Recital A hereof.

“Material Intellectual Property Collateral” shall mean any Intellectual Property
Collateral that is material (i) to the use and operation of the Pledged
Collateral or Mortgaged Property or (ii) to the business, results of operations,
prospects or condition, financial or otherwise, of any Pledgor.

“Mortgaged Property” shall have the meaning assigned to such term in the
Mortgages.

“Patents” shall mean, collectively, with respect to each Pledgor, (a) each
patent registration and application registered with United States Patent and
Trademark Office and (b) each other material patent issued or assigned to, and
all patent applications and registrations made by, such Pledgor (whether
established or registered or recorded in the United States or any other country
or any political subdivision thereof), together with any and all (i) rights and
privileges arising under applicable law with respect to such Pledgor’s use of
any patents, (ii) inventions and improvements described and claimed therein,
(iii) reissues, divisions, continuations, renewals, extensions and
continuations-in-part thereof and amendments thereto, (iv) income, fees,
royalties, damages, claims and payments now or hereafter due and/or payable
thereunder and with respect thereto including damages and payments for past,
present or future infringements thereof, (v) rights corresponding thereto
throughout the world and (vi) rights to sue for past, present or future
infringements thereof.

“Patent Security Agreement” shall mean an agreement substantially in the form of
Exhibit 7 hereto.

“Perfection Certificate” shall mean that certain perfection certificate dated
October 20, 2010 executed and delivered by each Pledgor in favor of the
Collateral Agent for the benefit of the Secured Parties, and each other
Perfection Certificate (which shall be in form and substance reasonably
acceptable to the Collateral Agent) executed and delivered by the applicable
Guarantor in favor of the Collateral Agent for the benefit of the Secured
Parties contemporaneously with the execution and delivery of each Joinder
Agreement executed in accordance with Section 3.5 hereof, in each case, as the
same may be amended, amended and restated, supplemented or otherwise modified
from time to time in accordance with the Credit Agreement or upon the request of
the Collateral Agent.

“Pledge Amendment” shall have the meaning assigned to such term in Section 5.1
hereof.

“Pledged Collateral” shall have the meaning assigned to such term in Section 2.1
hereof.

“Pledged Securities” shall mean, collectively, with respect to each Pledgor,
(i) all issued and outstanding Capital Stock of each issuer set forth on
Schedule 10(a) to the Perfection Certificate as being owned by such Pledgor and
all options, warrants, rights, agreements and additional Capital Stock of
whatever class of any such issuer acquired by such Pledgor (including by
issuance), together with all rights, privileges, authority and powers of such
Pledgor relating to such Capital Stock in each such issuer or under any
Constitutive Document of each such issuer, and the certificates, instruments and
agreements representing such Capital Stock and any and all interest of such
Pledgor in the entries on the books of any financial intermediary pertaining to
such Capital Stock, (ii) all Capital Stock of any Subsidiary, which Capital
Stock is hereafter acquired by such Pledgor (including by issuance) and all
options, warrants, rights, agreements and additional Capital Stock of whatever
class of any such Subsidiary acquired by such Pledgor (including by issuance),
together with all rights, privileges, authority and powers of such Pledgor
relating to such Capital Stock or under any Constitutive Document of any such
Subsidiary, and the certificates, instruments and agreements representing such
Capital Stock and any and all interest of such Pledgor in the entries on the
books of any financial intermediary pertaining to such Capital Stock, from

 

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time to time acquired by such Pledgor in any manner, and (iii) all Capital Stock
issued in respect of the Capital Stock referred to in clause (i) or (ii) upon
any consolidation or merger of any issuer of such Capital Stock; provided,
however, that Pledged Securities shall not include any Capital Stock (i) which
is not required to be pledged pursuant to Section 6.12(b) of the Credit
Agreement, (ii) which cannot be pledged pursuant to the terms of the issuer’s
Constitutive Documents as they exist on the Closing Date or (iii) of any Special
Purpose Receivables Subsidiary to the extent all of its activities are permitted
by and in compliance with the Credit Agreement.

“Pledgor” shall have the meaning assigned to such term in the Preamble hereof.

“Receivables” shall mean all (i) Accounts, (ii) Chattel Paper, (iii) Payment
Intangibles, (iv) Instruments and (v) to the extent not otherwise covered above,
all other rights to payment, whether or not earned by performance, for goods or
other property sold, leased, licensed, assigned or otherwise disposed of, or
services rendered or to be rendered, regardless of how classified under the UCC
together with all of Grantors’ rights, if any, in any goods or other property
giving rise to such right to payment and all Collateral Support and Supporting
Obligations related thereto and all Records relating thereto.

“Secured Parties” shall mean, collectively, the Administrative Agent, the
Collateral Agent, each other Agent, the Lenders, each Cash Management Bank and
each party to a Specified Swap Agreement (other than any Group Member) if, in
the case of any person not already a party to the Credit Agreement, such person
executes and delivers to the Administrative Agent a letter agreement in form and
substance acceptable to the Administrative Agent pursuant to which such person
(i) appoints the Collateral Agent as its agent under the applicable Loan
Documents and (ii) agrees to be bound by the provisions of Sections 11.5, 11.11
and 11.12 of the Credit Agreement and as if the fair market value of its Secured
Obligations constituted Loans under the Credit Agreement.

“Securities Account Control Agreement” shall mean an agreement substantially in
the form of Exhibit 4 hereto or such other form that is reasonably satisfactory
to the Collateral Agent establishing the Collateral Agent’s Control with respect
to any Securities Account.

“Securities Act” shall have the meaning assigned to such term in Section 9.4(b)
hereof.

“Securities Collateral” shall mean, collectively, the Pledged Securities, the
Intercompany Notes and the Distributions.

“Trademarks” shall mean, collectively, with respect to each Pledgor, (a) each
trademark registration and application registered with United States Patent and
Trademark Office and (b) all other material trademarks (including service
marks), slogans, logos, certification marks, trade dress, uniform resource
locations (URL’s), domain names, corporate names and trade names, whether
registered or unregistered, owned by or assigned to such Pledgor and all
registrations and applications for the foregoing (whether statutory or common
law and whether established or registered in the United States or any other
country or any political subdivision thereof), together with any and all
(i) rights and privileges arising under applicable law with respect to such
Pledgor’s use of any trademarks, (ii) reissues, continuations, extensions and
renewals thereof and amendments thereto, (iii) income, fees, royalties, damages
and payments now and hereafter due and/or payable thereunder and with respect
thereto, including damages, claims and payments for past, present or future
infringements thereof, (iv) rights corresponding thereto throughout the world
and (v) rights to sue for past, present and future infringements thereof.

“Trademark Security Agreement” shall mean an agreement substantially in the form
of Exhibit 8 hereto.

 

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“UCC” shall mean the Uniform Commercial Code as in effect from time to time in
the State of New York; provided, however, that, at any time, if by reason of
mandatory provisions of law, any or all of the perfection or priority of the
Collateral Agent’s and the Secured Parties’ security interest in any item or
portion of the Pledged Collateral is governed by the Uniform Commercial Code as
in effect in a jurisdiction other than the State of New York, the term “UCC”
shall mean the Uniform Commercial Code as in effect, at such time, in such other
jurisdiction for purposes of the provisions hereof relating to such perfection
or priority and for purposes of definitions relating to such provisions.

SECTION 1.2. Interpretation. The rules of interpretation specified in the Credit
Agreement (including Section 1.3 thereof) shall be applicable to this Agreement.

SECTION 1.3. Resolution of Drafting Ambiguities. Each Pledgor acknowledges and
agrees that it was represented by counsel in connection with the execution and
delivery hereof, that it and its counsel reviewed and participated in the
preparation and negotiation hereof and that any rule of construction to the
effect that ambiguities are to be resolved against the drafting party (i.e., the
Collateral Agent) shall not be employed in the interpretation hereof.

SECTION 1.4. Perfection Certificate. The Collateral Agent and each Secured Party
agree that the Perfection Certificate and all descriptions of Pledged
Collateral, schedules, amendments and supplements thereto are and shall at all
times remain a part of this Agreement.

ARTICLE II

GRANT OF SECURITY AND SECURED OBLIGATIONS

SECTION 2.1. Grant of Security Interest. As collateral security for the payment
and performance in full of all the Secured Obligations, each Pledgor hereby
pledges and grants to the Collateral Agent for the benefit of the Secured
Parties, a lien on and security interest in all of the right, title and interest
of such Pledgor in, to and under the following property, wherever located, and
whether now existing or hereafter arising or acquired from time to time
(collectively, the “Pledged Collateral”):

 

  (i) all Accounts;

 

  (ii) all Equipment, Goods, Inventory and Fixtures;

 

  (iii) all Documents, Instruments and Chattel Paper;

 

  (iv) all Letters of Credit and Letter-of-Credit Rights;

 

  (v) all Securities Collateral;

 

  (vi) all Investment Property;

 

  (vii) all Intellectual Property Collateral;

 

  (viii) the Commercial Tort Claims described on Schedule 13 to the Perfection
Certificate;

 

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  (ix) all General Intangibles;

 

  (x) all Money and all Deposit Accounts;

 

  (xi) all Supporting Obligations;

 

  (xii) all books and records relating to the Pledged Collateral; and

 

  (xiii) to the extent not covered by clauses (i) through (xii) of this
sentence, all other personal property of such Pledgor, whether tangible or
intangible, other than Capital Stock that does not constitute Pledged Securities
and all Proceeds and products of each of the foregoing and all accessions to,
substitutions and replacements for, and rents, profits and products of, each of
the foregoing, any and all Proceeds of any insurance, indemnity, warranty or
guaranty payable to such Pledgor from time to time with respect to any of the
foregoing.

Notwithstanding anything to the contrary contained in clauses (i) through
(xiii) above, the security interest created by this Agreement shall not extend
to, and the term “Pledged Collateral” shall not include, any Excluded Property
and (i) the Pledgors shall from time to time at the request of the Collateral
Agent give to the extent feasible without undue effort or expense (a) written
notice to the Collateral Agent identifying in reasonable detail the Excluded
Property and (b) provide to the Collateral Agent such other information
regarding the Excluded Property as the Collateral Agent may reasonably request
and (ii) from and after the Closing Date, no Pledgor shall permit to become
effective in any document creating, governing or providing for any permit,
license or agreement a provision that would prohibit the creation of a Lien on
such permit, license or agreement in favor of the Collateral Agent unless such
Pledgor believes, in its reasonable judgment, that such prohibition is usual and
customary in transactions of such type, or is necessary for such Pledgor to
obtain the same.

SECTION 2.2. Filings. (a) Each Pledgor hereby irrevocably authorizes the
Collateral Agent at any time and from time to time to file in any relevant
jurisdiction any financing statements (including fixture filings) and amendments
thereto that contain the information required by Article 9 of the Uniform
Commercial Code of each applicable jurisdiction for the filing of any financing
statement or amendment relating to the Pledged Collateral, including (i) whether
such Pledgor is an organization, the type of organization and any organizational
identification number issued to such Pledgor, (ii) any financing or continuation
statements or other documents without the signature of such Pledgor where
permitted by law, including the filing of a financing statement describing the
Pledged Collateral as “all assets now owned or hereafter acquired by the Pledgor
or in which Pledgor otherwise has rights and all proceeds thereof” and (iii) in
the case of a financing statement filed as a fixture filing or covering Pledged
Collateral constituting minerals or the like to be extracted or timber to be
cut, a sufficient description of the real property to which such Pledged
Collateral relates. Each Pledgor agrees to provide all information described in
the immediately preceding sentence to the Collateral Agent promptly upon request
by the Collateral Agent.

(b) Each Pledgor hereby ratifies its authorization for the Collateral Agent to
file in any relevant jurisdiction any financing statements relating to the
Pledged Collateral if filed prior to the date hereof.

(c) Each Pledgor hereby further authorizes the Collateral Agent to file filings
with the United States Patent and Trademark Office or United States Copyright
Office (or any successor office or any similar office in any other country),
including this Agreement, the Copyright Security Agreement,

 

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the Patent Security Agreement and the Trademark Security Agreement, or other
documents for the purpose of perfecting, confirming, continuing, enforcing or
protecting the security interest granted by such Pledgor hereunder, without the
signature of such Pledgor, and naming such Pledgor, as debtor, and the
Collateral Agent, as secured party.

ARTICLE III

PERFECTION; SUPPLEMENTS; FURTHER ASSURANCES;

USE OF PLEDGED COLLATERAL

SECTION 3.1. Delivery of Certificated Securities Collateral. Each Pledgor
represents and warrants that all certificates, agreements or instruments
representing or evidencing the Securities Collateral in existence on the date
hereof will be delivered to the Collateral Agent in suitable form for transfer
by delivery or accompanied by duly executed instruments of transfer or
assignment in blank within 20 days after the Closing Date (or such longer period
as the Collateral Agent may agree in its sole discretion) and that the
Collateral Agent has a perfected first priority security interest therein. Each
Pledgor hereby agrees that all certificates, agreements or instruments
representing or evidencing Securities Collateral acquired by such Pledgor after
the date hereof shall by the applicable date specified in Section 6.12 of the
Credit Agreement be delivered to and held by or on behalf of the Collateral
Agent pursuant hereto. All certificated Securities Collateral shall be in
suitable form for transfer by delivery or shall be accompanied by duly executed
instruments of transfer or assignment in blank, all in form and substance
satisfactory to the Collateral Agent. The Collateral Agent shall have the right,
at any time upon the occurrence and during the continuance of any Event of
Default, to endorse, assign or otherwise transfer to or to register in the name
of the Collateral Agent or any of its nominees or endorse for negotiation any or
all of the Securities Collateral, without any indication that such Securities
Collateral is subject to the security interest hereunder. In addition, upon the
occurrence and during the continuance of an Event of Default, the Collateral
Agent shall have the right at any time to exchange certificates representing or
evidencing Securities Collateral for certificates of smaller or larger
denominations.

SECTION 3.2. Perfection of Uncertificated Securities Collateral. Each Pledgor
represents and warrants that the Collateral Agent has a perfected first priority
security interest in all uncertificated Pledged Securities pledged by it
hereunder that are in existence on the date hereof. Each Pledgor hereby agrees
that if any of the Pledged Securities are at any time not evidenced by
certificates of ownership, then each applicable Pledgor shall, to the extent
permitted by applicable law, (i) cause the issuer to execute and deliver to the
Collateral Agent an acknowledgment of the pledge of such Pledged Securities
substantially in the form of Exhibit 1 hereto(provided, that the initial such
acknowledgment shall be delivered within 10 days after the Closing Date (or such
longer period as the Collateral Agent may agree in its sole discretion)),
(ii) if necessary or desirable to perfect a security interest in such Pledged
Securities, cause such pledge to be recorded on the equityholder register or the
books of the issuer, execute any customary pledge forms or other documents
necessary or appropriate to complete the pledge and give the Collateral Agent
the right to transfer such Pledged Securities under the terms hereof, (iii) upon
reasonable request by the Collateral Agent, provide to the Collateral Agent an
opinion of counsel, in form and substance reasonably satisfactory to the
Collateral Agent, confirming such pledge and perfection thereof, and (iv) after
the occurrence and during the continuance of any Event of Default, upon request
by the Collateral Agent, (A) to the extent such Pledgor has the ability to do
so, cause the Constitutive Documents of such issuer to be amended to provide
that such Pledged Securities shall be treated as “securities” for purposes of
the UCC and (B) cause such Pledged Securities to become certificated and
delivered to the Collateral Agent in accordance with the provisions of
Section 3.1.

 

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SECTION 3.3. Financing Statements and Other Filings; Maintenance of Perfected
Security Interest. Each Pledgor represents and warrants that all financing
statements, agreements, instruments and other documents necessary to perfect the
security interest granted by it to the Collateral Agent in respect of the
Pledged Collateral have been delivered to the Collateral Agent in completed and,
to the extent necessary or appropriate, duly executed form for filing in each
governmental, municipal or other office specified in Schedule 7 to the
Perfection Certificate. Each Pledgor agrees that at the sole cost and expense of
the Pledgors, such Pledgor will maintain the security interest created by this
Agreement in the Pledged Collateral as a perfected first priority security
interest subject only to Liens permitted pursuant to Section 7.1 of the Credit
Agreement.

SECTION 3.4. Other Actions. In order to further ensure the attachment,
perfection and priority of, and the ability of the Collateral Agent to enforce,
the Collateral Agent’s security interest in the Pledged Collateral, each Pledgor
represents and warrants (as to itself) as follows and agrees, in each case at
such Pledgor’s own expense, to take the following actions with respect to the
following Pledged Collateral:

(a) Instruments and Tangible Chattel Paper. As of the date hereof, no amounts
payable under or in connection with any of the Pledged Collateral are evidenced
by any Instrument or Tangible Chattel Paper other than such Instruments and
Tangible Chattel Paper listed in Schedule 11 to the Perfection Certificate. Each
Instrument and each item of Tangible Chattel Paper listed in Schedule 11 to the
Perfection Certificate that, together with all amounts payable which are
evidenced by any other Instrument or Tangible Chattel Paper so listed, exceeds
$5,000,000, has been properly endorsed, assigned and delivered to the Collateral
Agent, accompanied by instruments of transfer or assignment duly executed in
blank. If any amount then payable under or in connection with any of the Pledged
Collateral shall be evidenced by any Instrument or Tangible Chattel Paper, and
such amount, together with all amounts payable evidenced by any Instrument or
Tangible Chattel Paper not previously delivered to the Collateral Agent exceeds
$5,000,000 in the aggregate for all Pledgors, the Pledgor acquiring such
Instrument or Tangible Chattel Paper shall promptly (but in any event within
five days after receipt thereof) endorse, assign and deliver the same to the
Collateral Agent, accompanied by such instruments of transfer or assignment duly
executed in blank as the Collateral Agent may from time to time specify.

(b) Deposit Accounts. As of the date hereof, no Pledgor has any Deposit Accounts
other than the accounts listed in Schedule 14 to the Perfection Certificate.
Within 45 days after the Closing Date (or such longer period as the Collateral
Agent may agree in its sole discretion), the Collateral Agent shall have a first
priority security interest in each such Deposit Account, which security interest
is perfected by Control (except for those Deposit Accounts (the “Excluded
Deposit Accounts”) (i) for which Control is prohibited by Governmental Authority
so long as the balance of each such Deposit Account is swept daily to a Deposit
Account subject to the Collateral Agent’s Control, (ii) the available balance of
which is swept daily to a Deposit Account subject to the Collateral Agent’s
Control or (iii) the balance of which is not swept daily to a Deposit Account
subject to the Collateral Agent’s Control and which, in the aggregate, contain
no more than 15% of total cash of Borrower and its Subsidiaries at any time). No
Pledgor shall change the instructions directing the daily sweep of amounts in
the Excluded Deposit Accounts to Deposit Accounts subject to the Collateral
Agent’s Control. Other than in the case of an Excluded Deposit Account, no
Pledgor shall hereafter establish and maintain any Deposit Account unless (1) it
shall have given the Collateral Agent 30 days’ prior written notice of its
intention to establish such new Deposit Account with a Bank, (2) such Bank shall
be reasonably acceptable to the Collateral Agent and (3) such Bank and such
Pledgor shall have duly executed and delivered to the Collateral Agent a Deposit
Account Control Agreement with respect to such Deposit Account.

 

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No Pledgor shall hereafter establish and maintain an Excluded Deposit Account
referenced in clause (i) or (ii) of the definition thereof unless such Pledgor
shall have issued sweep instructions directing the bank to sweep funds from the
Excluded Deposit Account to a Deposit Account subject to the Collateral Agent’s
Control. The Collateral Agent agrees with each Pledgor that the Collateral Agent
shall not give any instructions directing the disposition of funds from time to
time credited to any Deposit Account or withhold any withdrawal rights from such
Pledgor with respect to funds from time to time credited to any Deposit Account
unless an Event of Default has occurred and is continuing. The provisions of
this Section 3.4(b) shall not apply to the LC Account. No Pledgor shall grant
Control of any Deposit Account to any person other than the Collateral Agent. No
Pledgor shall revise or revoke any instructions to a Bank under any Deposit
Account Control Agreement without the written consent of the Collateral Agent.

(c) Investment Property. (i) As of the date hereof, no Pledgor has any
Securities Accounts or Commodity Accounts other than those listed in Schedule 14
to the Perfection Certificate. Within 45 days after the Closing Date (or such
longer period as the Collateral Agent may agree in its sole discretion), the
Collateral Agent shall have a first priority security interest in each such
Securities Account and Commodity Account, which security interest is perfected
by Control, except for those Securities Accounts and Commodity Accounts, which,
in the aggregate, contain or carry or to which are credited no more than 15% of
total investments in securities and commodities of Borrower and its Subsidiaries
at any time (the “Excluded Securities/Commodity Accounts”). Other than in the
case of an Excluded Securities/Commodity Account, no Pledgor shall hereafter
establish and maintain any Securities Account or Commodity Account with any
Securities Intermediary or Commodity Intermediary unless (1) it shall have given
the Collateral Agent 30 days’ prior written notice of its intention to establish
such new Securities Account or Commodity Account with such Securities
Intermediary or Commodity Intermediary, (2) such Securities Intermediary or
Commodity Intermediary shall be reasonably acceptable to the Collateral Agent
and (3) such Securities Intermediary or Commodity Intermediary, as the case may
be, and such Pledgor shall have duly executed and delivered a Control Agreement
with respect to such Securities Account or Commodity Account, as the case may
be. Other than in the case of an Excluded Securities/Commodity Account, each
Pledgor shall accept any cash and Investment Property in trust for the benefit
of the Collateral Agent and within one (1) Business Day of actual receipt
thereof, deposit any and all Investment Property (other than any Investment
Property pledged or to be pledged pursuant to clauses (ii)(1), (iii)(1) or
(iii)(3) below) received by it into a Securities Account subject to Collateral
Agent’s Control. The Collateral Agent agrees with each Pledgor that the
Collateral Agent shall not give any Entitlement Orders or instructions or
directions to any issuer of uncertificated securities, Securities Intermediary
or Commodity Intermediary, and shall not withhold its consent to the exercise of
any withdrawal or dealing rights by such Pledgor, unless an Event of Default has
occurred and is continuing or, after giving effect to any such investment and
withdrawal rights, would occur. No Pledgor shall grant Control over any
Investment Property owned by such Pledgor to any person other than the
Collateral Agent.

(ii) If any Pledgor shall at any time hold or acquire any certificated
securities constituting Investment Property, such Pledgor shall by the
applicable date specified in Section 6.12 of the Credit Agreement (1) endorse,
assign and deliver the same to the Collateral Agent, accompanied by such
instruments of transfer or assignment duly executed in blank, all in form and
substance reasonably satisfactory to the Collateral Agent or (2) deliver such
securities into (i) a Securities Account with respect to which a Securities
Account Control Agreement is in effect in favor of the Collateral Agent or
(ii) an Excluded Securities/Commodity Account.

 

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(iii) If any Pledgor shall at any time own or acquire, directly or through a
nominee, any uncertificated securities constituting Investment Property, such
Pledgor shall by the applicable date specified in Section 6.12 of the Credit
Agreement notify the Collateral Agent thereof and pursuant to an agreement in
form and substance satisfactory to the Collateral Agent, either (1) cause the
issuer to agree to comply with instructions from the Collateral Agent as to such
securities, without further consent of any Pledgor or such nominee, (2) cause a
Security Entitlement with respect to such uncertificated security to be held in
(i) a Securities Account with respect to which the Collateral Agent has Control
or (ii) an Excluded Securities/Commodity Account or (3) arrange for the
Collateral Agent to become the registered owner of such securities.

(iv) As between the Collateral Agent and the Pledgors, the Pledgors shall bear
the investment risk with respect to the Investment Property and Pledged
Securities, and the risk of loss of, damage to, or the destruction of the
Investment Property and Pledged Securities, whether in the possession of, or
maintained as a Security Entitlement or deposit by, or subject to the Control
of, the Collateral Agent, a Securities Intermediary, a Commodity Intermediary,
any Pledgor or any other person.

(d) Electronic Chattel Paper and Transferable Records. As of the date hereof, no
amount under or in connection with any of the Pledged Collateral is evidenced by
any Electronic Chattel Paper or any “transferable record” (as that term is
defined in Section 201 of the Federal Electronic Signatures in Global and
National Commerce Act, or in Section 16 of the Uniform Electronic Transactions
Act as in effect in any relevant jurisdiction) other than such Electronic
Chattel Paper and transferable records listed in Schedule 11 to the Perfection
Certificate. If any amount payable under or in connection with any of the
Pledged Collateral shall be evidenced by any Electronic Chattel Paper or any
transferable record, the Pledgor acquiring such Electronic Chattel Paper or
transferable record shall promptly notify the Collateral Agent thereof and shall
take such action as the Collateral Agent may reasonably request to vest in the
Collateral Agent control of such Electronic Chattel Paper under Section 9-105 of
the UCC or control under Section 201 of the Federal Electronic Signatures in
Global and National Commerce Act or, as the case may be, Section 16 of the
Uniform Electronic Transactions Act, as so in effect in such jurisdiction, of
such transferable record. The requirement in the preceding sentence shall not
apply to the extent that such amount, together with all amounts payable
evidenced by Electronic Chattel Paper or any transferable record in which the
Collateral Agent has not been vested control within the meaning of the statutes
described in the immediately preceding sentence, does not exceed $5,000,000 in
the aggregate for all Pledgors. The Collateral Agent agrees with such Pledgor
that the Collateral Agent will arrange, pursuant to procedures satisfactory to
the Collateral Agent and so long as such procedures will not result in the
Collateral Agent’s loss of control, for the Pledgor to make alterations to the
Electronic Chattel Paper or transferable record permitted under Section 9-105 of
the UCC or, as the case may be, Section 201 of the Federal Electronic Signatures
in Global and National Commerce Act or Section 16 of the Uniform Electronic
Transactions Act for a party in control to allow without loss of control, unless
an Event of Default has occurred and is continuing or would occur after taking
into account any action by such Pledgor with respect to such Electronic Chattel
Paper or transferable record.

(e) Letter-of-Credit Rights. If any Pledgor is at any time a beneficiary under a
Letter of Credit now or hereafter issued, such Pledgor shall promptly notify the
Collateral Agent thereof and such Pledgor shall, at the request of the
Collateral Agent, pursuant to an agreement in form and substance reasonably
satisfactory to the Collateral Agent, either (i) arrange for the issuer and any
confirmer of such Letter of Credit to consent to an assignment to the Collateral
Agent of the proceeds of any drawing under the Letter of Credit or (ii) arrange
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the transferee beneficiary of such Letter of Credit, with the Collateral Agent
agreeing, in each case, that the proceeds of any drawing under the Letter of
Credit are to be applied as provided in the Credit Agreement. The actions in the
preceding sentence shall not be required to the extent that the amount of any
such Letter of Credit, together with the aggregate amount of all other Letters
of Credit for which the actions described above in clauses (i) and (ii) have not
been taken, does not exceed $10,000,000 in the aggregate for all Pledgors.

(f) Commercial Tort Claims. As of the date hereof, each Pledgor hereby
represents and warrants that it holds no Commercial Tort Claims other than those
listed in Schedule 13 to the Perfection Certificate. If any Pledgor shall at any
time hold or acquire a Commercial Tort Claim, such Pledgor shall immediately
notify the Collateral Agent in a writing signed by such Pledgor of the brief
details thereof and grant to the Collateral Agent in such writing a security
interest therein and in the Proceeds thereof, all upon the terms of this
Agreement, with such writing to be in form and substance reasonably satisfactory
to the Collateral Agent. The requirement in the preceding sentence shall not
apply to the extent that the amount of such Commercial Tort Claim, together with
the amount of all other Commercial Tort Claims held by any Pledgor in which the
Collateral Agent does not have a security interest, does not exceed $10,000,000
in the aggregate for all Pledgors.

(g) Motor Vehicles. Upon the request of the Collateral Agent, each Pledgor shall
deliver to the Collateral Agent originals of the certificates of title or
ownership for the motor vehicles (and any other Equipment covered by
certificates of title or ownership) owned by it, with the Collateral Agent
listed as lienholder therein. Such requirement shall not apply if any such motor
vehicle (or any such other Equipment) is valued at less than $100,000; provided
that the aggregate value of all motor vehicles (and such Equipment) as to which
any Pledgor has not delivered a certificate of title or ownership is less than
$10,000,000.

SECTION 3.5. Joinder of Additional Guarantors. The Pledgors shall cause each
Subsidiary of the Borrower which, from time to time, after the date hereof shall
be required to pledge any assets to the Collateral Agent for the benefit of the
Secured Parties pursuant to the provisions of the Credit Agreement, to execute
and deliver to the Collateral Agent (i) a Joinder Agreement substantially in the
form of Exhibit 3 hereto by the applicable date specified in Section 6.12 of the
Credit Agreement and (ii) at such time a Perfection Certificate and, upon such
execution and delivery, such Subsidiary shall constitute a “Guarantor” and a
“Pledgor” for all purposes hereunder with the same force and effect as if
originally named as a Guarantor and Pledgor herein. The execution and delivery
of such Joinder Agreement shall not require the consent of any Pledgor
hereunder. The rights and obligations of each Pledgor hereunder shall remain in
full force and effect notwithstanding the addition of any new Guarantor and
Pledgor as a party to this Agreement.

SECTION 3.6. Supplements; Further Assurances. Each Pledgor shall take such
further actions, and execute and/or deliver to the Collateral Agent such
additional financing statements, amendments, assignments, agreements,
supplements, powers and instruments, as the Collateral Agent may in its
reasonable judgment deem necessary or appropriate in order to create, perfect,
preserve and protect the security interest in the Pledged Collateral as provided
herein and the rights and interests granted to the Collateral Agent hereunder,
to carry into effect the purposes hereof or better to assure and confirm the
validity, enforceability and priority of the Collateral Agent’s security
interest in the Pledged Collateral or permit the Collateral Agent to exercise
and enforce its rights, powers and remedies hereunder with respect to any
Pledged Collateral, including the filing of financing statements, continuation
statements and other documents (including this Agreement) under the Uniform
Commercial Code (or other similar laws) in effect in any jurisdiction with
respect to the security interest created hereby and the

 

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execution and delivery of Control Agreements, all in form reasonably
satisfactory to the Collateral Agent and in such offices (including the United
States Patent and Trademark Office and the United States Copyright Office)
wherever required by law to perfect, continue and maintain the validity,
enforceability and priority of the security interest in the Pledged Collateral
as provided herein and to preserve the other rights and interests granted to the
Collateral Agent hereunder, as against third parties, with respect to the
Pledged Collateral. Without limiting the generality of the foregoing, each
Pledgor shall make, execute, endorse, acknowledge, file or refile and/or deliver
to the Collateral Agent from time to time upon reasonable request by the
Collateral Agent such lists, schedules, descriptions and designations of the
Pledged Collateral, copies of warehouse receipts, receipts in the nature of
warehouse receipts, bills of lading, documents of title, vouchers, invoices,
schedules, confirmatory assignments, supplements, additional security
agreements, conveyances, financing statements, transfer endorsements, powers of
attorney, certificates, reports and other assurances or instruments as the
Collateral Agent shall reasonably request. If an Event of Default has occurred
and is continuing, the Collateral Agent may institute and maintain, in its own
name or in the name of any Pledgor, such suits and proceedings as the Collateral
Agent may be advised by counsel shall be necessary or expedient to prevent any
impairment of the security interest in or the perfection thereof in the Pledged
Collateral. All of the foregoing shall be at the sole cost and expense of the
Pledgors.

ARTICLE IV

REPRESENTATIONS, WARRANTIES AND COVENANTS

Each Pledgor represents, warrants and covenants as follows:

SECTION 4.1. Title. Except for the security interest granted to the Collateral
Agent for the ratable benefit of the Secured Parties pursuant to this Agreement
and Permitted Liens, such Pledgor owns and has rights and, as to Pledged
Collateral acquired by it from time to time after the date hereof, will own and
have rights in each item of Pledged Collateral pledged by it hereunder, free and
clear of any and all Liens or claims of others other than as permitted under
Section 7.1 of the Credit Agreement. In addition, no Liens or claims exist on
the Securities Collateral, other than as permitted by Section 7.1 of the Credit
Agreement.

SECTION 4.2. Validity of Security Interest. The security interest in and Lien on
the Pledged Collateral granted to the Collateral Agent for the benefit of the
Secured Parties hereunder constitutes (a) a legal and valid security interest in
all the Pledged Collateral securing the payment and performance of the Secured
Obligations, and (b) subject to the filings and other actions described in
Schedule 7 to the Perfection Certificate (to the extent required to be listed on
the schedules to the Perfection Certificate as of the date this representation
is made or deemed made), a perfected security interest in all the Pledged
Collateral. The security interest and Lien granted to the Collateral Agent for
the benefit of the Secured Parties pursuant to this Agreement in and on the
Pledged Collateral will at all times constitute a perfected, continuing security
interest therein, prior to all other Liens on the Pledged Collateral except for
Liens permitted pursuant to Section 7.1 of the Credit Agreement.

SECTION 4.3. Defense of Claims; Transferability of Pledged Collateral. Subject
to Section 6.3 of the Credit Agreement, each Pledgor shall, at its own cost and
expense, defend title to the Pledged Collateral pledged by it hereunder and the
security interest therein and Lien thereon granted to the Collateral Agent and
the priority thereof against all claims and demands of all persons, at its own
cost and expense, at any time claiming any interest therein adverse to the
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Party other than Liens permitted pursuant to Section 7.1 of the Credit
Agreement. There is no agreement, order, judgment or decree, and no Pledgor
shall enter into any agreement or take any other action, that would restrict the
transferability of any of the Pledged Collateral or otherwise impair or conflict
with such Pledgor’s obligations or the rights of the Collateral Agent hereunder
other than actions or agreements granting customary rights to others in the
ordinary course of business.

SECTION 4.4. Other Financing Statements. It has not filed, nor authorized any
third party to file (nor will there be), any valid or effective financing
statement (or similar statement, instrument of registration or public notice
under the law of any jurisdiction) covering or purporting to cover any interest
of any kind in the Pledged Collateral, except such as have been filed in favor
of the Collateral Agent pursuant to this Agreement or in favor of any holder of
a Lien permitted pursuant to Section 7.1 of the Credit Agreement or with respect
to such Lien permitted pursuant to Section 7.1 of the Credit Agreement or
financing statements or public notices relating to the termination statements
listed on Schedule 9 to the Perfection Certificate. No Pledgor shall execute,
authorize or permit to be filed in any public office any financing statement (or
similar statement, instrument of registration or public notice under the law of
any jurisdiction) relating to any Pledged Collateral, except financing
statements and other statements and instruments filed or to be filed in respect
of and covering the security interests granted by such Pledgor to the holder of
the Permitted Liens and Liens described on Schedule 7.1(c) to the Credit
Agreement.

SECTION 4.5. Chief Executive Office; Change of Name; Jurisdiction of
Organization. The Collateral Agent may rely on advice of counsel as to whether
any or all UCC financing statements of the Pledgors need to be amended as a
result of any of the changes described in Section 6.14(a) of the Credit
Agreement. If any Pledgor fails to provide information to the Collateral Agent
about such changes on a timely basis, the Collateral Agent shall not be liable
or responsible to any party for any failure to maintain a perfected security
interest in such Pledgor’s property constituting Pledged Collateral, for which
the Collateral Agent needed to have information relating to such changes. The
Collateral Agent shall have no duty to inquire about such changes if any Pledgor
does not inform the Collateral Agent of such changes, the parties acknowledging
and agreeing that it would not be feasible or practical for the Collateral Agent
to search for information on such changes if such information is not provided by
any Pledgor.

SECTION 4.6. Location of Inventory and Equipment. It shall not move any
Equipment or Inventory with an aggregate value in excess of $1,000,000 to any
location, other than any location that is listed in the relevant Schedules to
the Perfection Certificate, unless it shall have given the Collateral Agent not
less than 30 days’ prior written notice (in the form of an Officers’
Certificate) of its intention so to do, clearly describing such new location and
providing such other information in connection therewith as the Collateral Agent
may request.

SECTION 4.7. Due Authorization and Issuance. All of the Pledged Securities
existing on the date hereof have been, and to the extent any Pledged Securities
are hereafter issued, such Pledged Securities will be, upon such issuance, duly
authorized, validly issued and fully paid and non-assessable.

SECTION 4.8. Consents, etc. In the event that the Collateral Agent desires to
exercise any remedies, voting or consensual rights or attorney-in-fact powers
set forth in this Agreement and determines it necessary to obtain any approvals
or consents of any Governmental Authority or any other person therefor, then,
upon the reasonable request of the Collateral Agent, such Pledgor agrees to use
its best efforts to assist and aid the Collateral Agent to obtain as soon as
practicable any necessary approvals or consents for the exercise of any such
remedies, rights and powers.

 

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SECTION 4.9. Pledged Collateral. All information set forth herein, including the
schedules hereto, and all information contained in any documents, schedules and
lists heretofore delivered to any Secured Party, including the Perfection
Certificate and the schedules thereto, taken as a whole and as supplemented from
time to time, in connection with this Agreement, in each case, relating to the
Pledged Collateral, is accurate and complete in all material respects. The
Pledged Collateral described on the schedules to the Perfection Certificate
constitutes all of the property of such type of Pledged Collateral owned or held
by the Pledgors.

SECTION 4.10. Insurance. In the event that the proceeds of any insurance claim
are paid to any Pledgor after the Collateral Agent has exercised its right to
foreclose after an Event of Default, such Net Cash Proceeds shall be held in
trust for the benefit of the Collateral Agent and immediately after receipt
thereof shall be paid to the Collateral Agent for application in accordance with
the Credit Agreement.

ARTICLE V

CERTAIN PROVISIONS CONCERNING SECURITIES COLLATERAL

SECTION 5.1. Pledge of Additional Securities Collateral. Each Pledgor shall,
upon obtaining any Pledged Securities or Intercompany Notes of any person,
accept the same in trust for the benefit of the Collateral Agent and by the
applicable date specified in Section 6.12 of the Credit Agreement deliver to the
Collateral Agent a pledge amendment, duly executed by such Pledgor, in
substantially the form of Exhibit 2 hereto (each, a “Pledge Amendment”), and the
certificates and other documents required under Section 3.1 and Section 3.2
hereof in respect of the additional Pledged Securities or Intercompany Notes
which are to be pledged pursuant to this Agreement, and confirming the
attachment of the Lien hereby created on and in respect of such additional
Pledged Securities or Intercompany Notes. Each Pledgor hereby authorizes the
Collateral Agent to attach each Pledge Amendment to this Agreement and agrees
that all Pledged Securities or Intercompany Notes listed on any Pledge Amendment
delivered to the Collateral Agent shall for all purposes hereunder be considered
Pledged Collateral.

SECTION 5.2. Voting Rights; Distributions; etc.

(a) So long as no Event of Default shall have occurred and be continuing:

(i) Each Pledgor shall be entitled to exercise any and all voting and other
consensual rights pertaining to the Securities Collateral or any part thereof
for any purpose not inconsistent with the terms or purposes hereof, the Credit
Agreement or any other document evidencing the Secured Obligations; provided,
however, that no Pledgor shall in any event exercise such rights in any manner
which would reasonably be expected to have a Material Adverse Effect.

(ii) Each Pledgor shall be entitled to receive and retain, and to utilize free
and clear of the Lien hereof, any and all Distributions, but only if and to the
extent made in accordance with the provisions of the Credit Agreement; provided,
however, that any and all such Distributions consisting of rights or interests
in the form of securities shall be forthwith delivered to the Collateral Agent
to hold as Pledged Collateral and shall, if received by any Pledgor, be received
in trust for the benefit of the Collateral Agent, be segregated from the other
property or funds of such Pledgor and be promptly (but in any event within five
days after receipt thereof) delivered to the Collateral Agent as Pledged
Collateral in the same form as so received (with any necessary endorsement).

 

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(b) So long as no Event of Default shall have occurred and be continuing, the
Collateral Agent shall be deemed without further action or formality to have
granted to each Pledgor all necessary consents relating to voting rights and
shall, if necessary, upon written request of any Pledgor and at the sole cost
and expense of the Pledgors, from time to time execute and deliver (or cause to
be executed and delivered) to such Pledgor all such instruments as such Pledgor
may reasonably request in order to permit such Pledgor to exercise the voting
and other rights which it is entitled to exercise pursuant to Section 5.2(a)(i)
hereof and to receive the Distributions which it is authorized to receive and
retain pursuant to Section 5.2(a)(ii) hereof.

(c) Upon the occurrence and during the continuance of any Event of Default:

(i) each Pledgor agrees not to exercise the voting and other consensual rights
it would otherwise be entitled to exercise pursuant to Section 5.2(a)(i) hereof,
and that the Collateral Agent shall thereupon have the sole right to exercise
such voting and other consensual rights.

(ii) each Pledgor agrees not to accept or receive Distributions which it would
otherwise be authorized to receive and retain pursuant to Section 5.2(a)(ii) and
all such distributions shall thereupon be delivered to the Collateral Agent,
which shall thereupon have the sole right to receive and hold as Pledged
Collateral such Distributions.

(d) Each Pledgor shall, at its sole cost and expense, from time to time execute
and deliver to the Collateral Agent appropriate instruments as the Collateral
Agent may request in order to permit the Collateral Agent to exercise the voting
and other rights which it may be entitled to exercise pursuant to
Section 5.2(a)(i) hereof and to receive all Distributions which it may be
entitled to receive under Section 5.2(a)(ii) hereof.

(e) All Distributions which are received by any Pledgor contrary to the
provisions of Section 5.2(a)(ii) hereof shall be received in trust for the
benefit of the Collateral Agent, shall be segregated from other funds of such
Pledgor and shall immediately be paid over to the Collateral Agent as Pledged
Collateral in the same form as so received (with any necessary endorsement).

SECTION 5.3. Defaults, etc. Such Pledgor is not in default in the payment of any
portion of any mandatory capital contribution, if any, required to be made under
any agreement to which such Pledgor is a party relating to the Pledged
Securities pledged by it, and such Pledgor is not in violation of any other
provisions of any such agreement to which such Pledgor is a party, or otherwise
in default or violation thereunder. No Securities Collateral pledged by such
Pledgor is subject to any defense, offset or counterclaim, nor have any of the
foregoing been asserted or alleged against such Pledgor by any person with
respect thereto, and as of the date hereof, there are no certificates,
instruments, documents or other writings (other than the Constitutive Documents
and certificates representing such Pledged Securities that have been delivered
to the Collateral Agent) which evidence any Pledged Securities of such Pledgor.

 

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SECTION 5.4. Certain Agreements of Pledgors As Issuers and Holders of Equity
Interests.

(a) In the case of each Pledgor which is an issuer of Securities Collateral,
such Pledgor agrees to be bound by the terms of this Agreement relating to the
Securities Collateral issued by it and will comply with such terms insofar as
such terms are applicable to it.

(b) In the case of each Pledgor which is a partner, shareholder or member, as
the case may be, in a partnership, limited liability company or other entity,
such Pledgor hereby consents to the extent required by the applicable
Constitutive Document to the pledge by each other Pledgor, pursuant to the terms
hereof, of the Pledged Securities in such partnership, limited liability company
or other entity and, upon the occurrence and during the continuance of an Event
of Default, to the transfer of such Pledged Securities to the Collateral Agent
or its nominee and to the substitution of the Collateral Agent or its nominee as
a substituted partner, shareholder or member in such partnership, limited
liability company or other entity with all the rights, powers and duties of a
general partner, limited partner, shareholder or member, as the case may be.

ARTICLE VI

CERTAIN PROVISIONS CONCERNING INTELLECTUAL

PROPERTY COLLATERAL

SECTION 6.1. Grant of Intellectual Property License. For the purpose of enabling
the Collateral Agent, during the continuance of an Event of Default, to exercise
rights and remedies under Article IX hereof at such time as the Collateral Agent
shall be lawfully entitled to exercise such rights and remedies, and for no
other purpose, each Pledgor hereby grants to the Collateral Agent, to the extent
such Pledgor has the right to do so without breaching or violating any Contract,
law or regulation, without violations of any applicable Intellectual Property
License, an irrevocable, non-exclusive license to use, assign, license or
sublicense any of the Intellectual Property Collateral now owned or hereafter
acquired by such Pledgor, wherever the same may be located. Such license shall
include, during such circumstances, reasonable access to all media in which any
of the licensed items may be recorded or stored and to all computer programs
used for the compilation or printout hereof.

SECTION 6.2. Protection of Collateral Agent’s Security. On a continuing basis,
each Pledgor shall, at its sole cost and expense, (i) promptly following its
becoming aware thereof, notify the Collateral Agent of any adverse determination
in any proceeding or the institution of any proceeding in any federal, state or
local court or administrative body or in the United States Patent and Trademark
Office or the United States Copyright Office regarding any Material Intellectual
Property Collateral, such Pledgor’s right to register such Material Intellectual
Property Collateral or its right to keep and maintain such registration in full
force and effect, (ii) maintain all Material Intellectual Property Collateral in
a manner consistent with commercially reasonable judgment, not permit to lapse
or become abandoned any Material Intellectual Property Collateral, and not
settle or compromise any pending or future litigation or administrative
proceeding with respect to any such Material Intellectual Property Collateral,
in any case except as shall be consistent with commercially reasonable judgment,
(iii) upon such Pledgor obtaining knowledge thereof, promptly notify the
Collateral Agent in writing of any event which may be reasonably expected to
materially and adversely affect the value or utility of any Material
Intellectual Property Collateral or the rights and remedies of the Collateral
Agent in relation thereto including a levy or threat of levy or any legal
process against any Material Intellectual Property Collateral, (iv) not license
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Property Collateral other than licenses entered into by such Pledgor in, or
incidental to, the ordinary course of business or otherwise in such Pledgor’s
commercially reasonable judgment, or amend or permit the amendment of any of the
licenses without the consent of the Collateral Agent, except in a manner
consistent with such Pledgor’s commercially reasonable judgment and that would
not materially impair the value of any Material Intellectual Property Collateral
or the Lien on and security interest in any Material Intellectual Property
Collateral created therein hereby, (v) diligently keep reasonable records
respecting all Intellectual Property Collateral consistent with such Pledgor’s
past practices with respect to such records and (vi) furnish to the Collateral
Agent from time to time upon the Collateral Agent’s reasonable request therefor
reasonably detailed statements and amended schedules further identifying and
describing the Intellectual Property Collateral and such other materials
evidencing or reports pertaining to any Intellectual Property Collateral as the
Collateral Agent may from time to time reasonably request.

SECTION 6.3. After-Acquired Property. If any Pledgor shall at any time after the
date hereof (i) obtain any rights to any additional Intellectual Property
Collateral or (ii) become entitled to the benefit of any additional Intellectual
Property Collateral or any renewal or extension thereof, including any reissue,
division, continuation, or continuation-in-part of any Intellectual Property
Collateral, or any improvement on any Intellectual Property Collateral, the
provisions hereof shall automatically apply thereto and any such item enumerated
in the preceding clause (i) or (ii) shall automatically constitute Intellectual
Property Collateral as if such would have constituted Intellectual Property
Collateral at the time of execution hereof and be subject to the Lien and
security interest created by this Agreement without further action by any party.
Each Pledgor shall promptly provide to the Collateral Agent written notice of
any of the foregoing with respect to any additional Material Intellectual
Property, and confirm the attachment of the Lien and security interest created
by this Agreement to any rights described in clauses (i) and (ii) above by
execution of an instrument in form reasonably acceptable to the Collateral Agent
and the filing of any instruments or statements as shall be reasonably necessary
to create, preserve, protect or perfect the Collateral Agent’s security interest
in such Intellectual Property Collateral. Further, each Pledgor authorizes the
Collateral Agent to modify this Agreement by amending Schedules 12(a) and 12(b)
to the Perfection Certificate to include any Intellectual Property Collateral of
such Pledgor acquired or arising after the date hereof.

SECTION 6.4. Litigation. Unless there shall occur and be continuing any Event of
Default, each Pledgor shall have the right (exercisable in such Pledgor’s
commercially reasonable judgment) to commence and prosecute in its own name, as
the party in interest, for its own benefit and at the sole cost and expense of
the Pledgors, such applications for protection of the Intellectual Property
Collateral and suits, proceedings or other actions to prevent the infringement,
counterfeiting, unfair competition, dilution, diminution in value or other
damage as are necessary to protect the Intellectual Property Collateral. Upon
the occurrence and during the continuance of any Event of Default and the
exercise of the Collateral Agent of its remedies pursuant to Article IX hereof
with respect to the Pledged Collateral, the Collateral Agent shall have the
right but shall in no way be obligated to file applications for protection of
the Intellectual Property Collateral and/or bring suit in the name of any
Pledgor, the Collateral Agent or the Secured Parties to enforce the Pledgor’s
rights in any Material Intellectual Property Collateral and any license
thereunder. In the event of such suit, each Pledgor shall, at the reasonable
request of the Collateral Agent, do any and all lawful acts and execute any and
all reasonable documents requested by the Collateral Agent in aid of such
enforcement and the Pledgors shall promptly reimburse and indemnify the
Collateral Agent for all costs and expenses reasonably incurred by the
Collateral Agent in the exercise of its rights under this Section 6.4 in
accordance with Section 11.5 of the Credit Agreement. In the event that the
Collateral Agent shall elect not to bring suit to enforce the Pledgor’s rights
in any Material Intellectual Property Collateral, each Pledgor agrees, at the
reasonable written request of the Collateral Agent, to take all commercially
reasonable actions necessary, whether by suit, proceeding or other action, to
prevent the infringement, counterfeiting, unfair competition, dilution,
diminution in value of or other damage to any Material Intellectual Property
Collateral by any person.

 

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ARTICLE VII

CERTAIN PROVISIONS CONCERNING RECEIVABLES

SECTION 7.1. Maintenance of Records. Each Pledgor shall keep and maintain at its
own cost and expense complete records of each Receivable, in a manner consistent
with prudent business practice, including records of all payments received, all
credits granted thereon, all merchandise returned and all other documentation
relating thereto. Each Pledgor shall, at such Pledgor’s sole cost and expense,
upon the Collateral Agent’s demand made at any time after the occurrence and
during the continuance of any Event of Default, deliver all tangible evidence of
Receivables, including all documents evidencing Receivables and any books and
records relating thereto to the Collateral Agent or to its representatives
(copies of which evidence and books and records may be retained by such
Pledgor). Upon the occurrence and during the continuance of any Event of
Default, the Collateral Agent may transfer a full and complete copy of any
Pledgor’s books, records, credit information, reports, memoranda and all other
writings relating to the Receivables to and for the use by any person that has
acquired or is contemplating acquisition of an interest in the Receivables or
the Collateral Agent’s security interest therein without the consent of any
Pledgor; provided that such person agrees to confidentiality provisions
substantially similar to those set forth in Section 11.15 of the Credit
Agreement.

SECTION 7.2. Legend. Each Pledgor shall legend, at the request of the Collateral
Agent and in form and manner satisfactory to the Collateral Agent, the
Receivables and the other books, records and documents of such Pledgor
evidencing or pertaining to the Receivables with an appropriate reference to the
fact that the Receivables have been assigned to the Collateral Agent for the
benefit of the Secured Parties and that the Collateral Agent has a security
interest therein.

SECTION 7.3. Modification of Terms, etc. No Pledgor shall rescind or cancel any
obligations evidenced by any Receivable or modify any term thereof or make any
adjustment with respect thereto except in the ordinary course of business
consistent with prudent business practice, or extend or renew any such
obligations except in the ordinary course of business consistent with prudent
business practice or compromise or settle any dispute, claim, suit or legal
proceeding relating thereto or sell any Receivable or interest therein except in
the ordinary course of business consistent with prudent business practice
without the prior written consent of the Collateral Agent. Each Pledgor shall
timely fulfill all obligations on its part to be fulfilled under or in
connection with the Receivables except to the extent such Pledgor determines
such action is not appropriate or advisable consistent with prudent business
practice in the ordinary course of business.

SECTION 7.4. Collection. Each Pledgor shall cause to be collected from the
Account Debtor of each of the Receivables, as and when due in the ordinary
course of business and consistent with prudent business practice (including
Receivables that are delinquent, such Receivables to be collected in accordance
with generally accepted commercial collection procedures), any and all amounts
owing under or on account of such Receivable, and apply forthwith upon receipt
thereof all such amounts as are so collected to the outstanding balance of such
Receivable, except that any Pledgor may, with respect to a Receivable, allow in
the ordinary course of business (i) a refund or credit due as a result of
returned or damaged or defective merchandise and (ii) such extensions of time to
pay amounts due in respect of Receivables and such other modifications of
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shall be commercially reasonable in the circumstances, all in accordance with
such Pledgor’s ordinary course of business consistent with its collection
practices as in effect from time to time. The costs and expenses (including
attorneys’ fees) of collection, in any case, whether incurred by any Pledgor,
the Collateral Agent or any Secured Party, shall be paid by the Pledgors.

ARTICLE VIII

TRANSFERS

SECTION 8.1. Transfers of Pledged Collateral. No Pledgor shall sell, convey,
assign or otherwise dispose of, or grant any option with respect to, any of the
Pledged Collateral pledged by it hereunder to the extent prohibited by the
Credit Agreement.

ARTICLE IX

REMEDIES

SECTION 9.1. Remedies. Upon the occurrence and during the continuance of any
Event of Default, the Collateral Agent may from time to time exercise in respect
of the Pledged Collateral, in addition to the other rights and remedies provided
for herein or otherwise available to it, the following remedies:

(i) To the fullest extent permitted by applicable law, personally, or by agents
or attorneys, immediately take possession of the Pledged Collateral or any part
thereof, from any Pledgor or any other person who then has possession of any
part thereof with or without notice or process of law, and for that purpose may
enter upon any Pledgor’s premises where any of the Pledged Collateral is
located, remove such Pledged Collateral, remain present at such premises to
receive copies of all communications and remittances relating to the Pledged
Collateral and use in connection with such removal and possession any and all
services, supplies, aids and other facilities of any Pledgor;

(ii) Demand, sue for, collect or receive any money or property at any time
payable or receivable in respect of the Pledged Collateral including instructing
the obligor or obligors on any agreement, instrument or other obligation
constituting part of the Pledged Collateral to make any payment required by the
terms of such agreement, instrument or other obligation directly to the
Collateral Agent, and in connection with any of the foregoing, compromise,
settle, extend the time for payment and make other modifications with respect
thereto; provided, however, that in the event that any such payments are made
directly to any Pledgor, prior to receipt by any such obligor of such
instruction, such Pledgor shall segregate all amounts received pursuant thereto
in trust for the benefit of the Collateral Agent and shall promptly (but in no
event later than one (1) Business Day after receipt thereof) pay such amounts to
the Collateral Agent;

(iii) Subject to Section 6.1, sell, assign, grant a license to use or otherwise
liquidate, or direct any Pledgor to sell, assign, grant a license to use or
otherwise liquidate, any and all investments made in whole or in part with the
Pledged Collateral or any part thereof, and take possession of the proceeds of
any such sale, assignment, license or liquidation;

 

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(iv) Take possession of the Pledged Collateral or any part thereof, by directing
any Pledgor in writing to deliver the same to the Collateral Agent at any place
or places so designated by the Collateral Agent, in which event such Pledgor
shall at its own expense: (A) forthwith cause the same to be moved to the place
or places designated by the Collateral Agent and therewith delivered to the
Collateral Agent, (B) store and keep any Pledged Collateral so delivered to the
Collateral Agent at such place or places pending further action by the
Collateral Agent and (C) while the Pledged Collateral shall be so stored and
kept, provide such security and maintenance services as shall be necessary to
protect the same and to preserve and maintain them in good condition. Each
Pledgor’s obligation to deliver the Pledged Collateral as contemplated in this
Section 9.1(iv) is of the essence hereof. Upon application to a court of equity
having jurisdiction, the Collateral Agent shall be entitled to a decree
requiring specific performance by any Pledgor of such obligation;

(v) Withdraw all moneys, instruments, securities and other property in any bank,
financial securities, deposit or other account of any Pledgor constituting
Pledged Collateral for application to the Secured Obligations as provided in
Article X hereof;

(vi) Retain and apply the Distributions to the Secured Obligations as provided
in Article X hereof;

(vii) Exercise any and all rights as beneficial and legal owner of the Pledged
Collateral, including perfecting assignment of and exercising any and all
voting, consensual and other rights and powers with respect to any Pledged
Collateral; and

(viii) Subject to Section 6.1, exercise all the rights and remedies of a secured
party on default under the UCC, and the Collateral Agent may also in its sole
discretion, without notice except as specified in Section 9.2 hereof, sell,
assign or grant a license to use the Pledged Collateral or any part thereof in
one or more parcels at public or private sale, at any exchange, broker’s board
or at any of the Collateral Agent’s offices or elsewhere, for cash, on credit or
for future delivery, and at such price or prices and upon such other terms as
the Collateral Agent may deem commercially reasonable. The Collateral Agent or
any other Secured Party or any of their respective Affiliates may be the
purchaser, licensee, assignee or recipient of the Pledged Collateral or any part
thereof at any such public sale, and to the fullest extent permitted by
applicable law, private sale and shall be entitled, for the purpose of bidding
and making settlement or payment of the purchase price for all or any portion of
the Pledged Collateral sold, assigned or licensed at such sale, to use and apply
any of the Secured Obligations owed to such person as a credit on account of the
purchase price of the Pledged Collateral or any part thereof payable by such
person at such sale. Each purchaser, assignee, licensee or recipient at any such
sale shall acquire the property sold, assigned or licensed absolutely free from
any claim or right on the part of any Pledgor, and each Pledgor hereby waives,
to the fullest extent permitted by law, all rights of redemption, stay and/or
appraisal which it now has or may at any time in the future have under any rule
of law or statute now existing or hereafter enacted. The Collateral Agent shall
not be obligated to make any sale of the Pledged Collateral or any part thereof
regardless of notice of sale having been given. The Collateral Agent may adjourn
any public or private sale from time to time by announcement at the time and
place fixed therefor, and such sale may, without further notice, be made at the
time and place to which it was so adjourned. Each Pledgor hereby waives, to the
fullest extent permitted by law, any claims against the Collateral Agent arising
by reason of the fact that the price at which the Pledged Collateral or any part
thereof may have been sold, assigned or licensed at such a private sale was less
than the price which might have been obtained at a public sale, even if the
Collateral Agent accepts the first offer received and does not offer such
Pledged Collateral to more than one offeree.

 

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SECTION 9.2. Notice of Sale. Each Pledgor acknowledges and agrees that, to the
extent notice of sale or other disposition of the Pledged Collateral or any part
thereof shall be required by law, ten (10) days’ prior notice to such Pledgor of
the time and place of any public sale or of the time after which any private
sale or other intended disposition is to take place shall be commercially
reasonable notification of such matters. No notification need be given to any
Pledgor if it has signed, after the occurrence of an Event of Default, a
statement renouncing or modifying any right to notification of sale or other
intended disposition.

SECTION 9.3. Waiver of Notice and Claims. Each Pledgor hereby waives, to the
fullest extent permitted by applicable law, notice or judicial hearing in
connection with the Collateral Agent’s taking possession or the Collateral
Agent’s disposition of the Pledged Collateral or any part thereof, including any
and all prior notice and hearing for any prejudgment remedy or remedies and any
such right which such Pledgor would otherwise have under law, and each Pledgor
hereby further waives, to the fullest extent permitted by applicable law:
(i) all damages occasioned by such taking of possession, (ii) all other
requirements as to the time, place and terms of sale or other requirements with
respect to the enforcement of the Collateral Agent’s rights hereunder and
(iii) all rights of redemption, appraisal, valuation, stay, extension or
moratorium now or hereafter in force under any applicable law. The Collateral
Agent shall not be liable for any incorrect or improper payment made pursuant to
this Article IX in the absence of gross negligence or willful misconduct on the
part of the Collateral Agent. Any sale of, or the grant of options to purchase,
or any other realization upon, any Pledged Collateral shall operate to divest
all right, title, interest, claim and demand, either at law or in equity, of the
applicable Pledgor therein and thereto, and shall be a perpetual bar both at law
and in equity against such Pledgor and against any and all persons claiming or
attempting to claim the Pledged Collateral so sold, optioned or realized upon,
or any part thereof, from, through or under such Pledgor.

SECTION 9.4. Certain Sales of Pledged Collateral.

(a) Each Pledgor recognizes that, by reason of certain prohibitions contained in
law, rules, regulations or orders of any Governmental Authority, the Collateral
Agent may be compelled, with respect to any sale of all or any part of the
Pledged Collateral, to limit purchasers to those who meet the requirements of
such Governmental Authority. Each Pledgor acknowledges that any such sales may
be at prices and on terms less favorable to the Collateral Agent than those
obtainable through a public sale without such restrictions, and, notwithstanding
such circumstances, agrees that any such restricted sale shall not be deemed to
have not been made in a commercially reasonable manner solely because it was
conducted as a private sale and that, except as may be required by applicable
law, the Collateral Agent shall have no obligation to engage in public sales.

(b) Each Pledgor recognizes that, by reason of certain prohibitions contained in
the Securities Act of 1933, as amended (the “Securities Act”), and applicable
state securities laws, the Collateral Agent may be compelled, with respect to
any sale of all or any part of the Securities Collateral and Investment
Property, to limit purchasers to persons who will agree, among other things, to
acquire such Securities Collateral or Investment Property for their own account,
for investment and not with a view to the distribution or resale thereof. Each
Pledgor acknowledges that any such private sales may be at prices and on terms
less favorable to the Collateral Agent than those obtainable through a public
sale without such restrictions (including a public offering made pursuant to a
registration statement under the Securities Act), and, notwithstanding such
circumstances, agrees that any such private sale shall not be deemed to have not
been made in a commercially reasonable manner solely because it was conducted as
a private sale, and that the Collateral Agent shall have no obligation to engage
in public sales and no obligation to delay the sale of any Securities Collateral
or Investment Property for the period of time necessary to permit the issuer
thereof to register it for a form of public sale requiring registration under
the Securities Act or under applicable state securities laws, even if such
issuer would agree to do so.

 

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(c) Notwithstanding the foregoing, each Pledgor shall, upon the occurrence and
during the continuance of any Event of Default, at the reasonable request of the
Collateral Agent, for the benefit of the Collateral Agent, cause any
registration, qualification statement or application under or compliance with
any Federal or state securities law or laws to be prepared and filed with
respect to all or any part of the Securities Collateral as soon as practicable
and at the sole cost and expense of the Pledgors. Each Pledgor will use its
commercially reasonable efforts to cause such registration to be effected (and
be kept effective) and will use its commercially reasonable efforts to cause
such qualification and compliance to be effected (and be kept effective) as may
be so requested and as would permit or facilitate the sale and distribution of
such Securities Collateral including registration under the Securities Act (or
any similar statute then in effect), appropriate qualifications under applicable
blue sky or other state securities laws and appropriate compliance with all
other requirements of any Governmental Authority. Each Pledgor shall use its
commercially reasonable efforts to cause the Collateral Agent to be kept advised
in writing as to the progress of each such registration, qualification or
compliance and as to the completion thereof, shall furnish to the Collateral
Agent such number of prospectuses, offering circulars or other documents
incident thereto as the Collateral Agent from time to time may request, and
shall indemnify and shall cause the issuer of the Securities Collateral to
indemnify the Collateral Agent and all others participating in the distribution
of such Securities Collateral against all claims, losses, damages and
liabilities caused by any untrue statement (or alleged untrue statement) of a
material fact contained therein (or in any related registration statement,
notification or the like) or by any omission (or alleged omission) to state
therein (or in any related registration statement, notification or the like) a
material fact required to be stated therein or necessary to make the statements
therein not misleading other than any such statement or omission made in
reliance on, and in conformity with, written information provided to such
Pledgor by Collateral Agent or any other participant in the distribution for
inclusion therein.

(d) If the Collateral Agent determines to exercise its right to sell any or all
of the Securities Collateral or Investment Property, upon written request, the
applicable Pledgor shall from time to time furnish to the Collateral Agent all
such information as the Collateral Agent may request in order to determine the
number of securities included in the Securities Collateral or Investment
Property which may be sold by the Collateral Agent as exempt transactions under
the Securities Act and the rules of the SEC thereunder, as the same are from
time to time in effect.

(e) Each Pledgor further agrees that a breach of any of the covenants contained
in this Section 9.4 will cause irreparable injury to the Collateral Agent and
the other Secured Parties, that the Collateral Agent and the other Secured
Parties have no adequate remedy at law in respect of such breach and, as a
consequence, that each and every covenant contained in this Section 9.4 shall be
specifically enforceable against such Pledgor, and such Pledgor hereby waives
and agrees not to assert any defenses against an action for specific performance
of such covenants except for a defense that no Event of Default has occurred and
is continuing.

SECTION 9.5. No Waiver; Cumulative Remedies.

(a) No failure on the part of the Collateral Agent to exercise, no course of
dealing with respect to, and no delay on the part of the Collateral Agent in
exercising, any right, power or remedy hereunder shall operate as a waiver
thereof; nor shall any single or partial exercise of any such right, power,
privilege or remedy hereunder preclude any other or further exercise thereof or
the exercise of any other right, power, privilege or remedy; nor shall the
Collateral Agent be required to look first to, enforce or exhaust any other
security, collateral or guaranties. All rights and remedies herein provided are
cumulative and are not exclusive of any rights or remedies provided by law or
otherwise available.

 

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(b) In the event that the Collateral Agent shall have instituted any proceeding
to enforce any right, power, privilege or remedy under this Agreement or any
other Loan Document by foreclosure, sale, entry or otherwise, and such
proceeding shall have been discontinued or abandoned for any reason or shall
have been determined adversely to the Collateral Agent, then and in every such
case, the Pledgors, the Collateral Agent and each other Secured Party shall be
restored to their respective former positions and rights hereunder with respect
to the Pledged Collateral, and all rights, remedies, privileges and powers of
the Collateral Agent and the other Secured Parties shall continue as if no such
proceeding had been instituted.

SECTION 9.6. Certain Additional Actions Regarding Intellectual Property. If any
Event of Default shall have occurred and be continuing, upon the written demand
of the Collateral Agent, each Pledgor shall execute and deliver to the
Collateral Agent an assignment or assignments of the registered Patents,
Trademarks and/or Copyrights and Goodwill and such other documents as are
necessary or appropriate to carry out the intent and purposes hereof. Within
five (5) Business Days of written notice thereafter from the Collateral Agent,
each Pledgor shall make available to the Collateral Agent, to the extent within
such Pledgor’s power and authority, such personnel in such Pledgor’s employ on
the date of the Event of Default as the Collateral Agent may reasonably
designate to permit such Pledgor to continue, directly or indirectly, to
produce, advertise and sell the products and services sold by such Pledgor under
the registered Patents, Trademarks and/or Copyrights, and such persons shall be
available to perform their prior functions on the Collateral Agent’s behalf.

ARTICLE X

APPLICATION OF PROCEEDS

SECTION 10.1. Application of Proceeds. The proceeds received by the Collateral
Agent in respect of any sale of, collection from or other realization upon all
or any part of the Pledged Collateral pursuant to the exercise by the Collateral
Agent of its remedies shall be applied, together with any other sums then held
by the Collateral Agent pursuant to this Agreement, in accordance with the
Credit Agreement.

ARTICLE XI

MISCELLANEOUS

SECTION 11.1. Concerning Collateral Agent.

(a) The Collateral Agent has been appointed as collateral agent pursuant to the
Credit Agreement. The actions of the Collateral Agent hereunder are subject to
the provisions of the Credit Agreement. The Collateral Agent shall have the
right hereunder to make demands, to give notices, to exercise or refrain from
exercising any rights, and to take or refrain from taking action (including the
release or substitution of the Pledged Collateral), in accordance with this
Agreement and the Credit Agreement. The Collateral Agent may employ agents and
attorneys-in-fact in connection herewith and shall not be liable for the
negligence or misconduct of any such agents or attorneys-in-fact selected by it

 

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in good faith. The Collateral Agent may resign and a successor Collateral Agent
may be appointed in the manner provided in the Credit Agreement. Upon the
acceptance of any appointment as the Collateral Agent by a successor Collateral
Agent, that successor Collateral Agent shall thereupon succeed to and become
vested with all the rights, powers, privileges and duties of the retiring
Collateral Agent under this Agreement, and the retiring Collateral Agent shall
thereupon be discharged from its duties and obligations under this Agreement.
After any retiring Collateral Agent’s resignation, the provisions hereof shall
inure to its benefit as to any actions taken or omitted to be taken by it under
this Agreement while it was the Collateral Agent.

(b) The Collateral Agent shall be deemed to have exercised reasonable care in
the custody and preservation of the Pledged Collateral in its possession if such
Pledged Collateral is accorded treatment substantially equivalent to that which
the Collateral Agent, in its individual capacity, accords its own property
consisting of similar instruments or interests, it being understood that neither
the Collateral Agent nor any of the Secured Parties shall have responsibility
for (i) ascertaining or taking action with respect to calls, conversions,
exchanges, maturities, tenders or other matters relating to any Securities
Collateral, whether or not the Collateral Agent or any other Secured Party has
or is deemed to have knowledge of such matters or (ii) taking any necessary
steps to preserve rights against any person with respect to any Pledged
Collateral.

(c) The Collateral Agent shall be entitled to rely upon any written notice,
statement, certificate, order or other document or any telephone message
believed by it to be genuine and correct and to have been signed, sent or made
by the proper person, and, with respect to all matters pertaining to this
Agreement and its duties hereunder, upon advice of counsel selected by it.

(d) If any item of Pledged Collateral also constitutes collateral granted to the
Collateral Agent under any other deed of trust, mortgage, security agreement,
pledge or instrument of any type, in the event of any conflict between the
provisions hereof and the provisions of such other deed of trust, mortgage,
security agreement, pledge or instrument of any type in respect of such
collateral, the Collateral Agent, in its sole discretion, shall select which
provision or provisions shall control.

SECTION 11.2. Collateral Agent May Perform; Collateral Agent Appointed
Attorney-in-Fact. If any Pledgor shall fail to perform any covenants contained
in this Agreement (including such Pledgor’s covenants to (i) pay the premiums in
respect of all required insurance policies hereunder, (ii) pay and discharge any
taxes, assessments and special assessments, levies, fees and governmental
charges imposed upon or assessed against, and landlords’, carriers’, mechanics’,
workmen’s, repairmen’s, laborers’, materialmen’s, suppliers’ and warehousemen’s
Liens and other claims arising by operation of law against, all or any portion
of the Pledged Collateral, (iii) make repairs, (iv) discharge Liens or (v) pay
or perform any obligations of such Pledgor under any Pledged Collateral) or if
any representation or warranty on the part of any Pledgor contained herein shall
be breached, the Collateral Agent may (but shall not be obligated to) do the
same or cause it to be done or remedy any such breach, and may expend funds for
such purpose; provided, however, that (a) in the case of clauses (ii) and
(iv) the Collateral Agent shall not make such payment or discharge any Lien
arising out of any tax, assessment, charge or claim that is being contested in
good faith and by proper proceedings and as to which appropriate reserves are
being maintained in accordance with GAAP, unless and until such Lien attaches to
such Pledgor’s property and becomes enforceable against such Pledgor’s other
creditors and subjects the property to a substantial risk of forfeiture and
(b) the Collateral Agent shall in no event be bound to inquire into the validity
of any tax, Lien, imposition or other obligation which such Pledgor fails to pay
or perform as and when required hereby and which such Pledgor does not contest
in accordance with the provisions of the Credit Agreement. Any and all amounts
so expended by the Collateral Agent shall be paid by the Pledgors in accordance
with the provisions of Section 11.5 of the Credit Agreement. Neither the
provisions of this Section

 

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11.2 nor any action taken by the Collateral Agent pursuant to the provisions of
this Section 11.2 shall prevent any such failure to observe any covenant
contained in this Agreement nor any breach of representation or warranty from
constituting an Event of Default. Each Pledgor hereby appoints the Collateral
Agent its attorney-in-fact, with full power and authority in the place and stead
of such Pledgor and in the name of such Pledgor, or otherwise, from time to time
in the Collateral Agent’s discretion to take any action and to execute any
instrument consistent with the terms of the Credit Agreement, this Agreement and
the other Security Documents which the Collateral Agent may deem necessary or
advisable to accomplish the purposes hereof (but the Collateral Agent shall not
be obligated to and shall have no liability to such Pledgor or any third party
for failure to so do or take action). The foregoing grant of authority is a
power of attorney coupled with an interest and such appointment shall be
irrevocable for the term hereof. Each Pledgor hereby ratifies all that such
attorney shall lawfully do or cause to be done by virtue hereof.

SECTION 11.3. Continuing Security Interest; Assignment. This Agreement shall
create a continuing security interest in the Pledged Collateral and shall (i) be
binding upon the Pledgors, their respective successors and assigns and
(ii) inure, together with the rights and remedies of the Collateral Agent
hereunder, to the benefit of the Collateral Agent and the other Secured Parties
and each of their respective successors, transferees and assigns. No other
persons (including any other creditor of any Pledgor) shall have any interest
herein or any right or benefit with respect hereto. Without limiting the
generality of the foregoing clause (ii), any Secured Party may assign or
otherwise transfer any indebtedness held by it secured by this Agreement to any
other person, and such other person shall thereupon become vested with all the
benefits in respect thereof granted to such Secured Party, herein or otherwise,
subject however, to the provisions of the Credit Agreement and, in the case of a
Secured Party that is a party to a Specified Swap Agreement or Secured Cash
Management Agreement, such Specified Swap Agreement or Secured Cash Management
Agreement.

SECTION 11.4. Termination; Release. (a) When all the Secured Obligations have
been paid in full (other than inchoate indemnification and cost reimbursement
obligations not then due) and the Commitments of the Lenders to make any Loan or
to issue any Letter of Credit under the Credit Agreement shall have expired or
been sooner terminated and all Letters of Credit have been terminated or cash
collateralized in accordance with the provisions of the Credit Agreement, this
Agreement shall terminate. Upon termination of this Agreement the Pledged
Collateral shall be released from the Lien of this Agreement and upon the sale
by any Pledgor of any Pledged Collateral in accordance with or without any
violation of Section 7.5 of the Credit Agreement, such Pledged Collateral shall
be released from the Lien of this Agreement. Within no more than 30 days from
notice to the Collateral Agent of such release or any release of Pledged
Collateral or any part thereof in accordance with the provisions of the Credit
Agreement, the Collateral Agent shall, upon the request and at the sole cost and
expense of the Pledgors, assign, transfer and deliver to Pledgor, against
receipt and without recourse to or warranty by the Collateral Agent except as to
the fact that the Collateral Agent has not encumbered the released assets, such
of the Pledged Collateral or any part thereof to be released (in the case of a
release) as may be in possession of the Collateral Agent and as shall not have
been sold or otherwise applied pursuant to the terms hereof, and, with respect
to any other Pledged Collateral, proper documents and instruments (including
UCC-3 termination financing statements or releases) acknowledging the
termination hereof or the release of such Pledged Collateral, as the case may
be.

(b) Notwithstanding Section 2.1, in connection with the granting of a Lien
permitted by Section 7.1(d) of the Credit Agreement in any Real Property or
Equipment owned by a Pledgor or with the disposition of Receivables Assets of a
Pledgor permitted by Section 7.5(i) of the Credit Agreement pursuant to a
Permitted Receivables Financing, the Collateral Agent shall, at such Pledgor’s
request if required by the lender or lessor providing Debt to be secured by such
Lien or such Receivables Assets, as applicable, at such Pledgor’s expense,
execute and deliver such documents as such Pledgor shall reasonably

 

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request to evidence the release of such item or items of Pledged Collateral from
the Lien of this Agreement; provided, however, that such Pledgor shall have
delivered to the Collateral Agent, at least three Business Days prior to the
date of the proposed release, a written request describing the items of
Collateral, together with a form of release for execution by the Collateral
Agent, and a certificate of the chief financial officer of such Pledgor to the
effect that the transaction is in compliance with the Credit Agreement and as to
such other matters as the Collateral Agent may reasonably request.

SECTION 11.5. Modification in Writing. No amendment, modification, supplement,
termination or waiver of or to any provision hereof, nor consent to any
departure by any Pledgor therefrom, shall be effective unless the same shall be
made in accordance with the terms of the Credit Agreement and unless in writing
and signed by the Collateral Agent. Any amendment, modification or supplement of
or to any provision hereof, any waiver of any provision hereof and any consent
to any departure by any Pledgor from the terms of any provision hereof in each
case shall be effective only in the specific instance and for the specific
purpose for which made or given. Except where notice is specifically required by
this Agreement or any other document evidencing the Secured Obligations, no
notice to or demand on any Pledgor in any case shall entitle any Pledgor to any
other or further notice or demand in similar or other circumstances.

SECTION 11.6. Notices. Unless otherwise provided herein or in the Credit
Agreement, any notice or other communication herein required or permitted to be
given shall be given in the manner and become effective as set forth in the
Credit Agreement, as to any Pledgor, addressed to it at the address of the
Borrower set forth in the Credit Agreement and as to the Collateral Agent,
addressed to it at the address set forth in the Credit Agreement, or in each
case at such other address as shall be designated by such party in a written
notice to the other party complying as to delivery with the terms of this
Section 11.6.

SECTION 11.7. Governing Law, Consent to Jurisdiction and Service of Process;
Waiver of Jury Trial. Sections 11.10, 11.11 and 11.12 of the Credit Agreement
are incorporated herein, mutatis mutandis, as if a part hereof.

SECTION 11.8. Severability of Provisions. Any provision hereof which is invalid,
illegal or unenforceable in any jurisdiction shall, as to such jurisdiction, be
ineffective to the extent of such invalidity, illegality or unenforceability
without invalidating the remaining provisions hereof or affecting the validity,
legality or enforceability of such provision in any other jurisdiction.

SECTION 11.9. Execution in Counterparts. This Agreement and any amendments,
waivers, consents or supplements hereto may be executed in any number of
counterparts and by different parties hereto in separate counterparts, each of
which when so executed and delivered shall be deemed to be an original, but all
such counterparts together shall constitute one and the same agreement.

SECTION 11.10. Business Days. In the event any time period or any date provided
in this Agreement ends or falls on a day other than a Business Day, then such
time period shall be deemed to end and such date shall be deemed to fall on the
next succeeding Business Day, and performance herein may be made on such
Business Day, with the same force and effect as if made on such other day.

SECTION 11.11. No Credit for Payment of Taxes or Imposition. Such Pledgor shall
not be entitled to any credit against the principal, premium, if any, or
interest payable under the Credit Agreement, and such Pledgor shall not be
entitled to any credit against any other sums which may become payable under the
terms thereof or hereof, by reason of the payment of any Tax on the Pledged
Collateral or any part thereof.

 

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SECTION 11.12. No Claims Against Collateral Agent. Nothing contained in this
Agreement shall constitute any consent or request by the Collateral Agent,
express or implied, for the performance of any labor or services or the
furnishing of any materials or other property in respect of the Pledged
Collateral or any part thereof, nor as giving any Pledgor any right, power or
authority to contract for or permit the performance of any labor or services or
the furnishing of any materials or other property in such fashion as would
permit the making of any claim against the Collateral Agent in respect thereof
or any claim that any Lien based on the performance of such labor or services or
the furnishing of any such materials or other property is prior to the Lien
hereof.

SECTION 11.13. No Release. Nothing set forth in this Agreement or any other Loan
Document, nor the exercise by the Collateral Agent of any of the rights or
remedies hereunder, shall relieve any Pledgor from the performance of any term,
covenant, condition or agreement on such Pledgor’s part to be performed or
observed under or in respect of any of the Pledged Collateral or from any
liability to any person under or in respect of any of the Pledged Collateral or
shall impose any obligation on the Collateral Agent or any other Secured Party
to perform or observe any such term, covenant, condition or agreement on such
Pledgor’s part to be so performed or observed or shall impose any liability on
the Collateral Agent or any other Secured Party for any act or omission on the
part of such Pledgor relating thereto or for any breach of any representation or
warranty on the part of such Pledgor contained in this Agreement, the Credit
Agreement or the other Loan Documents, or under or in respect of the Pledged
Collateral or made in connection herewith or therewith. Anything herein to the
contrary notwithstanding, neither the Collateral Agent nor any other Secured
Party shall have any obligation or liability under any contracts, agreements and
other documents included in the Pledged Collateral by reason of this Agreement,
nor shall the Collateral Agent or any other Secured Party be obligated to
perform any of the obligations or duties of any Pledgor thereunder or to take
any action to collect or enforce any such contract, agreement or other document
included in the Pledged Collateral hereunder. The obligations of each Pledgor
contained in this Section 11.13 shall survive the termination hereof and the
discharge of such Pledgor’s other obligations under this Agreement, the Credit
Agreement and the other Loan Documents.

SECTION 11.14. Obligations Absolute. All obligations of each Pledgor hereunder
shall be absolute and unconditional irrespective of:

(i) whether or not, at any time or from time to time, without notice to the
Pledgors, the time for any performance of or compliance with any of the Secured
Obligations shall be extended, or such performance or compliance shall be
waived;

(ii) whether or not any of the acts mentioned in any of the provisions of this
Agreement, the Credit Agreement, any Specified Swap Agreement, any Secured Cash
Management Agreement or the Notes, if any, or any other agreement or instrument
referred to herein or therein shall be done or omitted;

(iii) whether or not the maturity of any of the Secured Obligations shall be
accelerated, or any of the Secured Obligations or any Loan Document shall be
amended in any respect, or any right under the Loan Documents or any other
agreement or instrument referred to herein or therein shall be amended or waived
in any respect or any other guarantee of any of the Secured Obligations or any
security therefor shall be released or exchanged in whole or in part or
otherwise dealt with;

(iv) whether or not any Lien or security interest granted to, or in favor of,
the Issuing Lender or any Lender or Agent as security for any of the Secured
Obligations shall fail to be perfected or shall be impaired;

 

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(v) the release of any other Pledgor pursuant to Section 10.9 of the Credit
Agreement;

(vi) any bankruptcy, insolvency, reorganization, arrangement, readjustment,
composition, liquidation or the like of any Pledgor;

(vii) any lack of validity or enforceability of the Credit Agreement, any other
Loan Document, any Specified Swap Agreement, any Secured Cash Management
Agreement or any other agreement or instrument relating thereto against any
Pledgor; or

(viii) any other circumstance which might otherwise constitute a defense
available to, or a discharge of, any Pledgor.

[REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK.]

 

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IN WITNESS WHEREOF, each Pledgor and the Collateral Agent have caused this
Agreement to be duly executed and delivered by their duly authorized officers as
of the date first above written.

 

DAVITA INC., as Pledgor By:  

 

  Name:   Title:

[GUARANTORS],

as Pledgor

By:  

 

  Name:   Title:

 

S-1

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JPMORGAN CHASE BANK, N.A.,

as Collateral Agent

By:  

 

  Name:   Title:

 

S-2

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EXHIBIT 1

[Form of]

ISSUER’S ACKNOWLEDGMENT

The undersigned hereby (i) acknowledges receipt of the Security Agreement (as
amended, amended and restated, supplemented or otherwise modified from time to
time, the “Security Agreement;” capitalized terms used but not otherwise defined
herein shall have the meanings assigned to such terms in the Security
Agreement), dated as of October 20, 2010, made by DaVita Inc., a Delaware
corporation (the “Borrower”), the Guarantors party thereto and JPMorgan Chase
Bank, N.A., as collateral agent (in such capacity and together with any
successors in such capacity, the “Collateral Agent”), (ii) agrees promptly to
note on its books the security interests granted to the Collateral Agent and
confirmed under the Security Agreement, (iii) agrees that it will comply with
instructions of the Collateral Agent with respect to the applicable Securities
Collateral without further consent by the applicable Pledgor, (iv) agrees to
notify the Collateral Agent upon obtaining knowledge of any interest in favor of
any person in the applicable Securities Collateral that is adverse to the
interest of the Collateral Agent therein and (v) waives any right or requirement
at any time hereafter to receive a copy of the Security Agreement in connection
with the registration of any Securities Collateral thereunder in the name of the
Collateral Agent or its nominee or the exercise of voting rights by the
Collateral Agent or its nominee.

 

[                                         ] By:  

 

  Name:   Title:

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EXHIBIT 2

[Form of]

SECURITIES PLEDGE AMENDMENT

This Securities Pledge Amendment, dated as of [                ], is delivered
pursuant to Section 5.1 of the Security Agreement (as amended, amended and
restated, supplemented or otherwise modified from time to time, the “Security
Agreement;” capitalized terms used but not otherwise defined herein shall have
the meanings assigned to such terms in the Security Agreement), dated as of
October 20, 2010 made by DaVita Inc., a Delaware corporation (the “Borrower”),
the Guarantors party thereto and JPMorgan Chase Bank, N.A., as collateral agent
(in such capacity and together with any successors in such capacity, the
“Collateral Agent”). The undersigned hereby agrees that this Securities Pledge
Amendment may be attached to the Security Agreement and that the Pledged
Securities and/or Intercompany Notes listed on this Securities Pledge Amendment
shall be deemed to be and shall become part of the Pledged Collateral and shall
secure all Secured Obligations.

PLEDGED SECURITIES

 

ISSUER

   CLASS
OF STOCK
OR
INTERESTS    PAR VALUE    CERTIFICATE NO(S).    NUMBER OF SHARES
OR
INTERESTS    PERCENTAGE OF
ALL ISSUED CAPITAL
OR OTHER EQUITY
INTERESTS OF ISSUER

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

INTERCOMPANY NOTES

 

ISSUER

   PRINCIPAL
AMOUNT    DATE OF
ISSUANCE    INTEREST
RATE    MATURITY
DATE

 

[                                         ], as Pledgor By:  

 

  Name:   Title:

 

AGREED TO AND ACCEPTED: JPMORGAN CHASE BANK, N.A., as Collateral Agent By:  

 

  Name:   Title:

 

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EXHIBIT 3

[Form of]

JOINDER AGREEMENT

[Name of New Pledgor]

[Address of New Pledgor]

[Date]

JPMorgan Chase Bank, N.A.

383 Madison Avenue

New York, New York 10179

Ladies and Gentlemen:

Reference is made to the Security Agreement (as amended, amended and restated,
supplemented or otherwise modified from time to time, the “Security Agreement;”
capitalized terms used but not otherwise defined herein shall have the meanings
assigned to such terms in the Security Agreement), dated as of October 20, 2010,
made by DaVita Inc., a Delaware corporation (the “Borrower”), the Guarantors
party thereto and JPMorgan Chase Bank, N.A., as collateral agent (in such
capacity and together with any successors in such capacity, the “Collateral
Agent”).

This Joinder Agreement supplements the Security Agreement and is delivered by
the undersigned, [                ] (the “New Pledgor”), pursuant to Section 3.5
of the Security Agreement. The New Pledgor hereby agrees to be bound as a
Guarantor and as a Pledgor party to the Security Agreement by all of the terms,
covenants and conditions set forth in the Security Agreement to the same extent
that it would have been bound if it had been a signatory to the Security
Agreement on the date of the Security Agreement. The New Pledgor also hereby
agrees to be bound as a party by all of the terms, covenants and conditions
applicable to it set forth in Sections 6, 7 and 10 of the Credit Agreement to
the same extent that it would have been bound if it had been a signatory to the
Credit Agreement on the execution date of the Credit Agreement. Without limiting
the generality of the foregoing, the New Pledgor hereby grants and pledges to
the Collateral Agent, as collateral security for the full, prompt and complete
payment and performance when due (whether at stated maturity, by acceleration or
otherwise) of the Secured Obligations, a Lien on and security interest in, all
of its right, title and interest in, to and under the Pledged Collateral and
expressly assumes all obligations and liabilities of a Guarantor and Pledgor
thereunder. The New Pledgor hereby makes each of the representations and
warranties and agrees to each of the covenants applicable to the Pledgors
contained in the Security Agreement and Section 4 of the Credit Agreement.

Annexed hereto are supplements to each of the schedules to the Security
Agreement and the Credit Agreement, as applicable, with respect to the New
Pledgor. Such supplements shall be deemed to be part of the Security Agreement
or the Credit Agreement, as applicable.

This Joinder Agreement and any amendments, waivers, consents or supplements
hereto may be executed in any number of counterparts and by different parties
hereto in separate counterparts, each of which when so executed and delivered
shall be deemed to be an original, but all such counterparts together shall
constitute one and the same agreement.

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THIS JOINDER AGREEMENT SHALL BE GOVERNED BY, AND SHALL BE CONSTRUED AND ENFORCED
IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK (INCLUDING, WITHOUT
LIMITATION, SECTIONS 5-1401 AND 5-1402 OF THE NEW YORK GENERAL OBLIGATIONS LAW,
BUT OTHERWISE WITHOUT REGARD TO CONFLICTS OF LAWS PRINCIPLES THEREOF).

 

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IN WITNESS WHEREOF, the New Pledgor has caused this Joinder Agreement to be
executed and delivered by its duly authorized officer as of the date first above
written.

 

[NEW PLEDGOR]

By:

 

 

  Name:   Title:

 

AGREED TO AND ACCEPTED:

JPMORGAN CHASE BANK, N.A.,

as Collateral Agent

By:

 

 

  Name:   Title:

[Schedules to be attached]

 

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EXHIBIT 4

[Form of]

CONTROL AGREEMENT CONCERNING SECURITIES ACCOUNTS

This Control Agreement Concerning Securities Accounts (this “Control
Agreement”), dated as of [                ], by and among [                ]
(the “Pledgor”), JPMorgan Chase Bank, N.A., as Collateral Agent (the “Collateral
Agent”) and [                ] (the “Securities Intermediary”), is delivered
pursuant to Section 3.4(c) of that certain security agreement (as amended,
amended and restated, supplemented or otherwise modified from time to time, the
“Security Agreement”), dated as of October 20, 2010, made by the Pledgor and
each of the Guarantors listed on the signature pages thereto in favor of
JPMorgan Chase Bank, N.A., as collateral agent, as pledgee, assignee and secured
party (the “Collateral Agent”). This Control Agreement is for the purpose of
perfecting the security interests of the Secured Parties granted by the Pledgor
in the Designated Accounts described below. All references herein to the “UCC”
shall mean the Uniform Commercial Code as in effect from time to time in the
State of New York. Capitalized terms used but not defined herein shall have the
meanings assigned to such terms in the Security Agreement.

Section 1. Confirmation of Establishment and Maintenance of Designated Accounts.
The Securities Intermediary hereby confirms and agrees that (i) the Securities
Intermediary has established for the Pledgor and maintains the account(s) listed
in Schedule I annexed hereto (such account(s), together with each such other
securities account maintained by the Pledgor with the Securities Intermediary
collectively, the “Designated Accounts” and each a “Designated Account”),
(ii) each Designated Account will be maintained in the manner set forth herein
until termination of this Control Agreement, (iii) this Control Agreement is the
valid and legally binding obligation of the Securities Intermediary, (iv) the
Securities Intermediary is a “securities intermediary” as defined in Article
8-102(a)(14) of the UCC, (v) each of the Designated Accounts is a “securities
account” as such term is defined in Section 8-501(a) of the UCC and (vi) all
securities or other property underlying any financial assets which are credited
to any Designated Account shall be registered in the name of the Securities
Intermediary, endorsed to the Securities Intermediary or in blank or credited to
another securities account maintained in the name of the Securities Intermediary
and in no case will any financial asset credited to any Designated Account be
registered in the name of the Pledgor, payable to the order of the Pledgor or
specially endorsed to the Pledgor, except to the extent the foregoing have been
specially endorsed to the Securities Intermediary or in blank.

Section 2. “Financial Assets” Election. All parties hereto agree that each item
of Investment Property and all other property held in or credited to any
Designated Account (the “Account Property”) shall be treated as a “financial
asset” within the meaning of Section 8-102(a)(9) of the UCC.

Section 3. Entitlement Order. If at any time the Securities Intermediary shall
receive an “entitlement order” (within the meaning of Section 8-102(a)(8) of the
UCC) issued by the Collateral Agent and relating to any financial asset
maintained in one or more of the Designated Accounts, the Securities
Intermediary shall comply with such entitlement order without further consent by
the Pledgor or any other person. The Securities Intermediary shall also comply
with instructions directing the Securities Intermediary with respect to the
sale, exchange or transfer of any Account Property held in each Designated
Account originated by a Pledgor, or any representative of, or investment manager
appointed by, a Pledgor until such time as the Collateral Agent delivers a
Notice of Sole Control pursuant to Section 9(i) hereof to the Securities
Intermediary. The Securities Intermediary shall comply with, and is fully
entitled to rely upon, any entitlement order from the Collateral Agent, even if
such entitlement order is contrary to any entitlement order that the Pledgor may
give or may have given to the Securities Intermediary.

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

Section 4. Subordination of Lien; Waiver of Set-Off. The Securities Intermediary
hereby agrees that any security interest in, lien on, encumbrance, claim or
(except as provided in the next sentence) right of setoff against, any
Designated Account or any Account Property it now has or subsequently obtains
shall be subordinate to the security interest of the Collateral Agent in the
Designated Accounts and the Account Property therein or credited thereto. The
Securities Intermediary agrees not to exercise any present or future right of
recoupment or set-off against any of the Designated Accounts or to assert
against any of the Designated Accounts any present or future security interest,
banker’s lien or any other lien or claim (including claim for penalties) that
the Securities Intermediary may at any time have against or in any of the
Designated Accounts or any Account Property therein or credited thereto;
provided, however, that the Securities Intermediary may set off all amounts due
to the Securities Intermediary in respect of its customary fees and expenses for
the maintenance and operation of the Designated Accounts, including overdraft
fees and amounts advanced to settle authorized transactions.

Section 5. Choice of Law. Both this Control Agreement and the Designated
Accounts shall be governed by the laws of the State of New York (including,
without limitation, Sections 5-1401 and 5-1402 of the New York General
Obligations Law, but otherwise without regard to conflicts of laws principles
thereof). Regardless of any provision in any other agreement, for purposes of
the UCC, New York shall be deemed to be the Securities Intermediary’s
jurisdiction and the Designated Accounts (as well as the security entitlements
related thereto) shall be governed by the laws of the State of New York.

Section 6. Conflict with Other Agreements; Amendments. As of the date hereof,
there are no other agreements entered into between the Securities Intermediary
and the Pledgor with respect to any Designated Account or any security
entitlements or other financial assets credited thereto (other than standard and
customary documentation with respect to the establishment and maintenance of
such Designated Accounts). The Securities Intermediary and the Pledgor will not
enter into any other agreement with respect to any Designated Account unless the
Collateral Agent shall have received prior written notice thereof. The
Securities Intermediary and the Pledgor have not and will not enter into any
other agreement with respect to (i) creation or perfection of any security
interest in or (ii) control of security entitlements maintained in any of the
Designated Accounts or purporting to limit or condition the obligation of the
Securities Intermediary to comply with entitlement orders with respect to any
Account Property held in or credited to any Designated Account as set forth in
Section 3 hereof without the prior written consent of the Collateral Agent
acting in its sole discretion. In the event of any conflict with respect to
control over any Designated Account between this Control Agreement (or any
portion hereof) and any other agreement now existing or hereafter entered into,
the terms of this Control Agreement shall prevail. No amendment or modification
of this Control Agreement or waiver of any rights hereunder shall be binding on
any party hereto unless it is in writing and is signed by all the parties
hereto.

Section 7. Certain Agreements.

(i) As of the date hereof, the Securities Intermediary has furnished to the
Collateral Agent the most recent account statement issued by the Securities
Intermediary with respect to each of the Designated Accounts and the financial
assets and cash balances held therein, identifying the financial assets held
therein in a manner acceptable to the Collateral Agent. Each such statement
accurately reflects the assets held in such Designated Account as of the date
thereof.

(ii) The Securities Intermediary will, upon its receipt of each supplement to
the Security Agreement signed by the Pledgor and identifying one or more
financial assets as “Pledged

 

-2-

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

Collateral,” enter into its records, including computer records, with respect to
each Designated Account a notation with respect to any such financial asset so
that such records and reports generated with respect thereto identify such
financial asset as “Pledged.”

Section 8. Notice of Adverse Claims. Except for the claims and interest of the
Collateral Agent and of the Pledgor in the Account Property held in or credited
to the Designated Accounts, the Securities Intermediary on the date hereof does
not know of any claim to, security interest in, lien on, or encumbrance against,
any Designated Account or Account Property held in or credited thereto and does
not know of any claim that any person or entity other than the Collateral Agent
has been given “control” (within the meaning of Section 8-106 of the UCC) of any
Designated Account or any such Account Property. If the Securities Intermediary
becomes aware that any person or entity is asserting any lien, encumbrance,
security interest or adverse claim (including any writ, garnishment, judgment,
warrant of attachment, execution or similar process or any claim of control)
against any of the Account Property held in or credited to any Designated
Account, the Securities Intermediary shall promptly notify the Collateral Agent
and the Pledgor thereof.

Section 9. Maintenance of Designated Accounts. In addition to the obligations of
the Securities Intermediary in Section 3 hereof, the Securities Intermediary
agrees to maintain the Designated Accounts as follows:

(i) Notice of Sole Control. If at any time the Collateral Agent delivers to the
Securities Intermediary a notice instructing the Securities Intermediary to
terminate Pledgor’s access to any Designated Account (the “Notice of Sole
Control”), the Securities Intermediary agrees that, after receipt of such
notice, it will take all instructions with respect to such Designated Account
solely from the Collateral Agent, terminate all instructions and orders
originated by the Pledgor with respect to the Designated Accounts or any Account
Property therein, and cease taking instructions from Pledgor, including, without
limitation, instructions for investment, distribution or transfer of any
financial asset maintained in any Designated Account and permitting settlement
of trades pending at the time of receipt of such notice shall not constitute a
violation of the immediately preceding sentence.

(ii) Voting Rights. Until such time as the Securities Intermediary receives a
Notice of Sole Control, the Pledgor, or an investment manager on behalf of the
Pledgor, shall direct the Securities Intermediary with respect to the voting of
any financial assets credited to any Designated Account.

(iii) Statements and Confirmations. The Securities Intermediary will send copies
of all statements and other correspondence (excluding routine confirmations)
concerning any Designated Account or any financial assets credited thereto
simultaneously to each of the Pledgor and the Collateral Agent at the address
set forth in Section 11 hereof. The Securities Intermediary will provide to the
Collateral Agent, upon the Collateral Agent’s request therefor from time to time
and, in any event, as of the last business day of each calendar month, a
statement of the market value of each financial asset maintained in each
Designated Account. The Securities Intermediary shall not change the name or
account number of any Designated Account without the prior written consent of
the Collateral Agent.

(iv) Perfection in Certificated Securities. The Securities Intermediary
acknowledges that, in the event that it should come into possession of any
certificate representing any security or other Account Property held in or
credited to any of the Designated Accounts, the Securities Intermediary shall
retain possession of the same on behalf and for the benefit of the Collateral
Agent and such act shall cause the Securities Intermediary to be deemed holding
such certificate

 

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for the Collateral Agent, if necessary to perfect the Collateral Agent’s
security interest in such securities or assets. The Securities Intermediary
hereby acknowledges its receipt of a copy of the Security Agreement, which shall
also serve as notice to the Securities Intermediary of a security interest in
collateral held on behalf and for the benefit of the Collateral Agent.

Section 10. Successors; Assignment. The terms of this Control Agreement shall be
binding upon, and shall inure to the benefit of, the parties hereto and their
respective corporate successors and permitted assignees.

Section 11. Notices. Any notice, request or other communication required or
permitted to be given under this Control Agreement shall be in writing and
deemed to have been properly given when delivered in person, or when sent by
telecopy or other electronic means and electronic confirmation of error free
receipt is received or two (2) days after being sent by certified or registered
United States mail, return receipt requested, postage prepaid, addressed to the
party at the address set forth below.

 

Pledgor:

   [                        ]    [Address]    Attention:    Telecopy:   
Telephone:    with copy to:    [                        ]    [Address]   
Attention:    Telecopy:    Telephone:

Securities

  

Intermediary:

   [                        ]    [Address]    Attention:    Telecopy:   
Telephone:

Collateral

  

Agent:

   JPMorgan Chase Bank, Loan and Agency Services Group    1111 Fannin, 10th
Floor    Houston, Texas 77002    Attention: Maria Saez    Telecopy: 713-374-4312
   Telephone:    with a copy to:    JPMorgan Chase Bank, N.A.    383 Madison
Avenue    New York, New York 10179    Attention: Dawn Lee Lum    Telecopy:
212-270-3279

 

 

-4-

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  with a copy to:   Cahill Gordon & Reindel LLP   80 Pine Street   New York, New
York 10005   Attention:    Daniel J. Zubkoff, Esq.   Telecopy:    (212) 269-5420
  Telephone:    (212) 701-3000

Any party may change its address for notices in the manner set forth above.

Section 12. Termination.

(i) Except as otherwise provided in this Section 12, the obligations of the
Securities Intermediary hereunder and this Control Agreement shall continue in
effect until the security interests of the Collateral Agent in the Designated
Accounts and any and all Account Property held therein or credited thereto have
been terminated pursuant to the terms of the Security Agreement and the
Collateral Agent has notified the Securities Intermediary of such termination in
writing.

(ii) The Securities Intermediary, acting alone, may terminate this Control
Agreement at any time and for any reason by written notice delivered to the
Collateral Agent and the Pledgor not less than thirty (30) days prior to the
effective termination date.

(iii) Prior to any termination of this Control Agreement pursuant to this
Section 12, the Securities Intermediary hereby agrees that it shall promptly
take, at Pledgor’s sole cost and expense, all reasonable actions necessary to
facilitate the transfer of any Account Property in or credited to the Designated
Accounts as follows: (i) in the case of a termination of this Control Agreement
under Section 12(i) hereof, to the institution designated in writing by Pledgor;
and (ii) in all other cases, to the institution designated in writing by the
Collateral Agent.

Section 13. Fees and Expenses. The Securities Intermediary agrees to look solely
to assets in the Designated Accounts and the Pledgor for payment of any and all
fees, costs, charges and expenses incurred or otherwise relating to the
Designated Accounts and services provided by the Securities Intermediary
hereunder (collectively, the “Account Expenses”), and the Pledgor agrees to pay
such Account Expenses to the Securities Intermediary on demand therefor. The
Pledgor acknowledges and agrees that it shall be, and at all times remains,
solely liable to the Securities Intermediary for all Account Expenses.

Section 14. Severability. If any term or provision set forth in this Control
Agreement shall be invalid or unenforceable, the remainder of this Control
Agreement, other than those provisions held invalid or unenforceable, shall be
construed in all respects as if such invalid or unenforceable term or provision
were omitted.

Section 15. Counterparts. This Control Agreement may be executed in any number
of counterparts, all of which shall constitute one and the same instrument, and
any party hereto may execute this Control Agreement by signing and delivering
one or more counterparts.

[signature page follows]

 

-5-

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[                    ], as Pledgor By:  

 

  Name:   Title:

JPMORGAN CHASE BANK, N.A.,

as Collateral Agent

By:  

 

  Name:   Title:

[                    ],

as Securities Intermediary

By:  

 

  Name:   Title:

 

S-1

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SCHEDULE I

Designated Account(s)

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

EXHIBIT 5

[Form of]

CONTROL AGREEMENT CONCERNING DEPOSIT ACCOUNTS

[For Pledgors without Government Receivables]

This CONTROL AGREEMENT CONCERNING DEPOSIT ACCOUNTS (this “Control Agreement”),
dated as of [                ], by and among [                ] (the “Pledgor”),
JPMorgan Chase Bank, N.A., as Collateral Agent (the “Collateral Agent”) and
[                ] (the “Bank”), is delivered pursuant to Section 3.4(b) of that
certain security agreement (as amended, amended and restated, supplemented or
otherwise modified from time to time, the “Security Agreement”), dated as of
October 20, 2010 made by the Pledgor and each of the Guarantors listed on the
signature pages thereto in favor of JPMorgan Chase Bank, N.A., as collateral
agent, as pledgee, assignee and secured party (the “Collateral Agent”). This
Control Agreement is for the purpose of perfecting the security interests of the
Secured Parties granted by the Pledgor in the Designated Accounts described
below. All references herein to the “UCC” shall mean the Uniform Commercial Code
as in effect from time to time in the State of New York. Capitalized terms used
but not defined herein shall have the meanings assigned to such terms in the
Security Agreement.

Section 1. Confirmation of Establishment and Maintenance of Designated Accounts.
The Bank hereby confirms and agrees that (i) the Bank has established for the
Pledgor and maintains the deposit account(s) listed in Schedule 1 annexed hereto
(such account(s), together with each such other deposit account maintained by
the Pledgor with the Bank collectively, the “Designated Accounts” and each a
“Designated Account”), (ii) each Designated Account will be maintained in the
manner set forth herein until termination of this Control Agreement, (iii) the
Bank is a “bank,” as such term is defined in the UCC, (iv) this Control
Agreement is the valid and legally binding obligation of the Bank and (v) each
Designated Account is a “deposit account” as such term is defined in Article 9
of the UCC.

Section 2. Control. The Bank shall comply with instructions originated by the
Collateral Agent without further consent of the Pledgor or any person acting or
purporting to act for the Pledgor being required, including, without limitation,
directing disposition of the funds in each Designated Account. The Bank shall
also comply with instructions directing the disposition of funds in each
Designated Account originated by the Pledgor or its authorized representatives
until such time as the Collateral Agent delivers a Notice of Sole Control
pursuant to Section 8(i) hereof to the Bank. The Bank shall comply with, and is
fully entitled to rely upon, any instruction from the Collateral Agent, even if
such instruction is contrary to any instruction that the Pledgor may give or may
have given to the Bank.

Section 3. Subordination of Lien; Waiver of Set-Off. The Bank hereby agrees that
any security interest in, lien on, encumbrance, claim or (except as provided in
the next sentence) right of setoff against, any Designated Account or any funds
therein it now has or subsequently obtains shall be subordinate to the security
interest of the Collateral Agent in the Designated Accounts and the funds
therein or credited thereto. The Bank agrees not to exercise any present or
future right of recoupment or set-off against any of the Designated Accounts or
to assert against any of the Designated Accounts any present or future security
interest, banker’s lien or any other lien or claim (including claim for
penalties) that the Bank may at any time have against or in any of the
Designated Accounts or any funds therein; provided, however, that the Bank may
set off (i) all amounts due to the Bank in respect of its customary fees and
expenses for the maintenance and operation of the Designated Accounts, including
overdraft fees, and (ii) the face amount of any checks or other items which have
been credited to any Designated Account but are subsequently returned unpaid
because of uncollected or insufficient funds).

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Section 4. Choice of Law. Both this Control Agreement and the Designated
Accounts shall be governed by the laws of the State of New York (including,
without limitation, Sections 5-1401 and 5-1402 of the New York General
Obligations Law, but otherwise without regard to conflicts of laws principles
thereof). Regardless of any provision in any other agreement, for purposes of
the UCC, New York shall be deemed to be the Bank’s jurisdiction and the
Designated Account(s) shall be governed by the law of the State of New York.

Section 5. Conflict with Other Agreements; Amendments. As of the date hereof,
there are no other agreements entered into between the Bank and the Pledgor with
respect to any Designated Account or any funds credited thereto (other than
standard and customary documentation with respect to the establishment and
maintenance of such Designated Accounts). The Bank and the Pledgor will not
enter into any other agreement with respect to any Designated Account unless the
Collateral Agent shall have received prior written notice thereof. The Bank and
the Pledgor have not and will not enter into any other agreement with respect to
control of the Designated Accounts or purporting to limit or condition the
obligation of the Bank to comply with any orders or instructions with respect to
any Designated Account as set forth in Section 2 hereof without the prior
written consent of the Collateral Agent acting in its sole discretion. In the
event of any conflict with respect to control over any Designated Account
between this Control Agreement (or any portion hereof) and any other agreement
now existing or hereafter entered into, the terms of this Control Agreement
shall prevail. No amendment or modification of this Control Agreement or waiver
of any right hereunder shall be binding on any party hereto unless it is in
writing and is signed by all the parties hereto.

Section 6. Certain Agreements. As of the date hereof, the Bank has furnished to
the Collateral Agent the most recent account statement issued by the Bank with
respect to each of the Designated Accounts and the cash balances held therein.
Each such statement accurately reflects the assets held in such Designated
Account as of the date thereof.

Section 7. Notice of Adverse Claims. Except for the claims and interest of the
Secured Parties and of the Pledgor in the Designated Accounts, the Bank on the
date hereof does not know of any claim to, security interest in, lien on, or
encumbrance against, any Designated Account or in any funds credited thereto and
does not know of any claim that any person or entity other than the Collateral
Agent has been given control (within the meaning of Section 9-104 of the UCC) of
any Designated Account or any such funds. If the Bank becomes aware that any
person or entity is asserting any lien, encumbrance, security interest or
adverse claim (including any writ, garnishment, judgment, warrant of attachment,
execution or similar process or any claim of control) against any funds in any
Designated Account, the Bank shall promptly notify the Collateral Agent and the
Pledgor thereof.

Section 8. Maintenance of Designated Accounts. In addition to the obligations of
the Bank in Section 2 hereof, the Bank agrees to maintain the Designated
Accounts as follows:

(i) Notice of Sole Control. If at any time the Collateral Agent delivers to the
Bank a notice instructing the Bank to terminate Pledgor’s access to any
Designated Account (the “Notice of Sole Control”), the Bank agrees that, after
receipt of such notice, it will take all instruction with respect to such
Designated Account solely from the Collateral Agent, terminate all instructions
and orders originated by the Pledgor with respect to the Designated Accounts or
any funds therein, and cease taking instructions from the Pledgor, including,
without limitation, instructions for distribution or transfer of any funds in
any Designated Account.

 

-2-

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(ii) Statements and Confirmations. The Bank will send copies of all statements
and other correspondence (excluding routine confirmations) concerning any
Designated Account simultaneously to the Pledgor and the Collateral Agent at the
address set forth in Section 10 hereof. The Bank will promptly provide to the
Collateral Agent, upon request therefor from time to time and, in any event, as
of the last business day of each calendar month, a statement of the cash balance
in each Designated Account. The Bank shall not change the name or account number
of any Designated Account without the prior written consent of the Collateral
Agent.

Section 9. Successors; Assignment. The terms of this Control Agreement shall be
binding upon, and shall inure to the benefit of, the parties hereto and their
respective corporate successors and permitted assignees.

Section 10. Notices. Any notice, request or other communication required or
permitted to be given under this Control Agreement shall be in writing and
deemed to have been properly given when delivered in person, or when sent by
telecopy or other electronic means and electronic confirmation of error free
receipt is received or two (2) days after being sent by certified or registered
United States mail, return receipt requested, postage prepaid, addressed to the
party at the address set forth below.

 

Pledgor:    [                        ]    [Address]    Attention:    Telecopy:
   Telephone:    with copy to:    [                        ]    [Address]   
Attention:    Telecopy:    Telephone: Bank:    [                        ]   
[                        ]    [                        ]    Attention:   
Telecopy:    Telephone: Collateral    Agent:    JPMorgan Chase Bank, Loan and
Agency Services Group    1111 Fannin, 10th Floor    Houston, Texas 77002   
Attention: Maria Saez    Telecopy: 713-374-4312    Telephone:    with a copy to:
   JPMorgan Chase Bank, N.A.    383 Madison Avenue

 

-3-

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

   New York, New York 10179    New York, NY 10017    Attention: Dawn Lee Lum   
Telecopy: 212-270-3279    with a copy to:    Cahill Gordon & Reindel LLP    80
Pine Street    New York, New York 10005    Attention:     Daniel J. Zubkoff,
Esq.    Telecopy:     (212) 269-5420    Telephone:     (212) 701-3000

Any party may change its address for notices in the manner set forth above.

Section 11. Termination.

(i) Except as otherwise provided in this Section 11, the obligations of the Bank
hereunder and this Control Agreement shall continue in effect until the security
interests of the Collateral Agent in the Designated Accounts and any and all
funds therein have been terminated pursuant to the terms of the Security
Agreement and the Collateral Agent has notified the Bank of such termination in
writing.

(ii) The Bank, acting alone, may terminate this Control Agreement at any time
and for any reason by written notice delivered to the Collateral Agent and the
Pledgor not less than thirty (30) days prior to the effective termination date.

(iii) Prior to any termination of this Control Agreement pursuant to this
Section 11, the Bank hereby agrees that it shall promptly take, at Pledgor’s
sole cost and expense, all reasonable actions necessary to facilitate the
transfer of any funds in the Designated Accounts as follows: (a) in the case of
a termination of this Control Agreement under Section 11(i), to the institution
designated in writing by Pledgor; and (b) in all other cases, to the institution
designated in writing by the Collateral Agent.

Section 12. Fees and Expenses. The Bank agrees to look solely to the Designated
Accounts and the Pledgor for payment of any and all fees, costs, charges and
expenses incurred or otherwise relating to the Designated Accounts and services
provided by the Bank hereunder (collectively, the “Account Expenses”), and the
Pledgor agrees to pay such Account Expenses to the Bank on demand therefor. The
Pledgor acknowledges and agrees that it shall be, and at all times remains,
solely liable to the Bank for all Account Expenses.

Section 13. Severability. If any term or provision set forth in this Control
Agreement shall be invalid or unenforceable, the remainder of this Control
Agreement, other than those provisions held invalid or unenforceable, shall be
construed in all respects as if such invalid or unenforceable term or provision
were omitted.

Section 14. Counterparts. This Control Agreement may be executed in any number
of counterparts, all of which shall constitute one and the same instrument, and
any party hereto may execute this Control Agreement by signing and delivering
one or more counterparts.

 

-4-

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[signature page follows]

 

-5-

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[                        ] By:  

 

  Name:   Title:

JPMORGAN CHASE BANK, N.A.,

as Collateral Agent

By:  

 

  Name:   Title:

[                         ],

as Bank

By:  

 

  Name:   Title:

 

S-1

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SCHEDULE 1

Designated Account(s)

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

[Form of]

CONTROL AGREEMENT CONCERNING DEPOSIT ACCOUNTS

[For Pledgors with Government Receivables]

This CONTROL AGREEMENT CONCERNING DEPOSIT ACCOUNTS (this “Control Agreement”),
dated as of [                ], by and among [                ] (the “Pledgor”),
JPMorgan Chase Bank, N.A., as Collateral Agent (the “Collateral Agent”) and
[                ] (the “Bank”), is delivered pursuant to Section 3.4(b) of that
certain security agreement (as amended, amended and restated, supplemented or
otherwise modified from time to time, the “Security Agreement”), dated as of
October 20, 2010 made by the Pledgor and each of the Guarantors listed on the
signature pages thereto in favor of JPMorgan Chase Bank, N.A., as collateral
agent, as pledgee, assignee and secured party (the “Collateral Agent”). This
Control Agreement is for the purpose of perfecting the security interests of the
Secured Parties granted by the Pledgor in the Designated Accounts described
below. All references herein to the “UCC” shall mean the Uniform Commercial Code
as in effect from time to time in the State of New York. Capitalized terms used
but not defined herein shall have the meanings assigned to such terms in the
Security Agreement.

Section 1. Confirmation of Establishment and Maintenance of Designated Accounts.
The Bank hereby confirms and agrees that (i) the Bank has established for the
Pledgor and maintains the deposit account(s) listed in Schedule 1 annexed hereto
(such account(s) except for any Depository Accounts (as such terms defined
below), together with each such other deposit account maintained by the Pledgor
with the Bank collectively, the “Designated Accounts” and each a “Designated
Account”), (ii) each Designated Account will be maintained in the manner set
forth herein until termination of this Control Agreement, (iii) the Bank is a
“bank,” as such term is defined in the UCC, (iv) this Control Agreement is the
valid and legally binding obligation of the Bank and (v) each Designated Account
and each Depository Account is a “deposit account” as such term is defined in
Article 9 of the UCC. For each Pledgor the Bank has established at least two
deposit accounts, one of which shall be for the deposit of receivables from
Government Reimbursement Programs (the “Depository Account”) and a second
account which shall be for the deposit of all other receivables (the “Operating
Account”). The Pledgor hereby instructs the Bank to sweep on a daily basis all
funds in each Depository Account into Pledgor’s Operating Account.

Section 2. Control. The Bank shall comply with instructions originated by the
Collateral Agent without further consent of the Pledgor or any person acting or
purporting to act for the Pledgor being required, including, without limitation,
directing disposition of the funds in each Designated Account. The Bank shall
also comply with instructions directing the disposition of funds in each
Designated Account originated by the Pledgor or its authorized representatives
until such time as the Collateral Agent delivers a Notice of Sole Control
pursuant to Section 8(i) hereof to the Bank. The Bank shall comply with, and is
fully entitled to rely upon, any instruction from the Collateral Agent, even if
such instruction is contrary to any instruction that the Pledgor may give or may
have given to the Bank.

Section 3. Subordination of Lien; Waiver of Set-Off. The Bank hereby agrees that
any security interest in, lien on, encumbrance, claim or (except as provided in
the next sentence) right of setoff against, any Designated Account or any funds
therein it now has or subsequently obtains shall be subordinate to the security
interest of the Collateral Agent in the Designated Accounts and the funds
therein or credited thereto. The Bank agrees not to exercise any present or
future right of recoupment or set-off against any of the Designated Accounts or
to assert against any of the Designated Accounts any present or future security
interest, banker’s lien or any other lien or claim (including claim for
penalties)

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

that the Bank may at any time have against or in any of the Designated Accounts
or any funds therein; provided, however, that the Bank may set off (i) all
amounts due to the Bank in respect of its customary fees and expenses for the
maintenance and operation of the Designated Accounts, including overdraft fees,
and (ii) the face amount of any checks or other items which have been credited
to any Designated Account but are subsequently returned unpaid because of
uncollected or insufficient funds).

Section 4. Choice of Law. Both this Control Agreement and the Designated
Accounts shall be governed by the laws of the State of New York (including,
without limitation, Sections 5-1401 and 5-1402 of the New York General
Obligations Law, but otherwise without regard to conflicts of laws principles
thereof). Regardless of any provision in any other agreement, for purposes of
the UCC, New York shall be deemed to be the Bank’s jurisdiction and the
Designated Account(s) shall be governed by the law of the State of New York.

Section 5. Conflict with Other Agreements; Amendments. As of the date hereof,
there are no other agreements entered into between the Bank and the Pledgor with
respect to any Designated Account or any funds credited thereto (other than
standard and customary documentation with respect to the establishment and
maintenance of such Designated Accounts). The Bank and the Pledgor will not
enter into any other agreement with respect to any Designated Account unless the
Collateral Agent shall have received prior written notice thereof. The Bank and
the Pledgor have not and will not enter into any other agreement with respect to
control of the Designated Accounts or purporting to limit or condition the
obligation of the Bank to comply with any orders or instructions with respect to
any Designated Account as set forth in Section 2 hereof without the prior
written consent of the Collateral Agent acting in its sole discretion. In the
event of any conflict with respect to control over any Designated Account
between this Control Agreement (or any portion hereof) and any other agreement
now existing or hereafter entered into, the terms of this Control Agreement
shall prevail. The Pledgor covenants that it will not enter into any other
agreement with respect to any Depository Account and has not and will not enter
into any other agreement with respect to control over any Depository Account or
purporting to limit or condition the obligation of the Bank to comply with the
last sentence of Section 1 hereof with respect to any Depository Account, in
each case, without the prior written consent of the Collateral Agent acting in
its sole discretion. In the event of any conflict with respect to control over
any Depository Account between this Control Agreement (or any portion hereof)
and any other agreement now existing or hereafter entered into, the terms of
this Control Agreement shall prevail. The Bank will promptly notify the
Collateral Agent if the Pledgor revises or revokes any instructions regarding a
Depository Account or the funds therein including, without limitation, a change
or revocation of sweep instructions set forth in Section 1 and the statements
and other correspondence set forth in Section 8(ii). No amendment or
modification of this Control Agreement or waiver of any right hereunder shall be
binding on any party hereto unless it is in writing and is signed by all the
parties hereto.

Section 6. Certain Agreements. As of the date hereof, the Bank has furnished to
the Collateral Agent the most recent account statement issued by the Bank with
respect to each of the Designated Accounts and the cash balances held therein.
Each such statement accurately reflects the assets held in such Designated
Account as of the date thereof.

Section 7. Notice of Adverse Claims. Except for the claims and interest of the
Secured Parties and of the Pledgor in the Designated Accounts, the Bank on the
date hereof does not know of any claim to, security interest in, lien on, or
encumbrance against, any Designated Account or in any funds credited thereto and
does not know of any claim that any person or entity other than the Collateral
Agent has been given control (within the meaning of Section 9-104 of the UCC) of
any Designated Account or any such funds. If the Bank becomes aware that any
person or entity is asserting any lien, encumbrance, security interest or
adverse claim (including any writ, garnishment, judgment, warrant of attachment,
execution or similar process or any claim of control) against any funds in any
Designated Account, the Bank shall promptly notify the Collateral Agent and the
Pledgor thereof.

 

-2-

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

Section 8. Maintenance of Designated Accounts. In addition to the obligations of
the Bank in Section 2 hereof, the Bank agrees to maintain the Designated
Accounts as follows:

(i) Notice of Sole Control. If at any time the Collateral Agent delivers to the
Bank a notice instructing the Bank to terminate Pledgor’s access to any
Designated Account (the “Notice of Sole Control”), the Bank agrees that, after
receipt of such notice, it will take all instruction with respect to such
Designated Account solely from the Collateral Agent, terminate all instructions
and orders originated by the Pledgor with respect to the Designated Accounts or
any funds therein, and cease taking instructions from the Pledgor, including,
without limitation, instructions for distribution or transfer of any funds in
any Designated Account. With regard to Depository Accounts, the Bank shall
promptly notify the Collateral Agent if the Pledgor revokes or otherwise changes
the sweep instructions, revokes permission regarding statements and
correspondence or changes the name or account number of any Depository Account.

(ii) Statements and Confirmations. The Bank will send copies of all statements
and other correspondence (excluding routine confirmations) concerning any
Designated Account or Depository Account simultaneously to the Pledgor and the
Collateral Agent at the address set forth in Section 10 hereof. The Bank will
promptly provide to the Collateral Agent, upon request therefor from time to
time and, in any event, as of the last business day of each calendar month, a
statement of the cash balance in each Designated Account. The Bank shall not
change the name or account number of any Designated Account without the prior
written consent of the Collateral Agent. The Pledgor will not request that the
Bank cease sending copies of all statements and other correspondence concerning
any Depository Account or change the name or account number of any Depository
Account without the prior written consent of the Collateral Agent.

Section 9. Successors; Assignment. The terms of this Control Agreement shall be
binding upon, and shall inure to the benefit of, the parties hereto and their
respective corporate successors and permitted assignees.

Section 10. Notices. Any notice, request or other communication required or
permitted to be given under this Control Agreement shall be in writing and
deemed to have been properly given when delivered in person, or when sent by
telecopy or other electronic means and electronic confirmation of error free
receipt is received or two (2) days after being sent by certified or registered
United States mail, return receipt requested, postage prepaid, addressed to the
party at the address set forth below.

 

Pledgor:    [                        ]    [Address]    Attention:    Telecopy:
   Telephone:    with copy to:    [                        ]    [Address]   
Attention:    Telecopy:    Telephone:

 

-3-

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

Bank:    [                    ]    [                    ]   
[                    ]    Attention:    Telecopy:    Telephone: Collateral   
Agent:    JPMorgan Chase Bank, Loan and Agency Services Group    1111 Fannin,
10th Floor    Houston, Texas 77002    Attention: Maria Saez    Telecopy:
713-374-4312    Telephone:    with a copy to:    JPMorgan Chase Bank, N.A.   
383 Madison Avenue    New York, New York 10179    Attention: Dawn Lee Lum   
Telecopy: 212-270-3279    with a copy to:    Cahill Gordon & Reindel LLP    80
Pine Street    New York, New York 10005    Attention:     Daniel J. Zubkoff,
Esq.    Telecopy:     (212) 269-5420    Telephone:     (212) 701-3000

Any party may change its address for notices in the manner set forth above.

Section 11. Termination.

(i) Except as otherwise provided in this Section 11, the obligations of the Bank
hereunder and this Control Agreement shall continue in effect until the security
interests of the Collateral Agent in the Designated Accounts and any and all
funds therein have been terminated pursuant to the terms of the Security
Agreement and the Collateral Agent has notified the Bank of such termination in
writing.

(ii) The Bank, acting alone, may terminate this Control Agreement at any time
and for any reason by written notice delivered to the Collateral Agent and the
Pledgor not less than thirty (30) days prior to the effective termination date.

(iii) Prior to any termination of this Control Agreement pursuant to this
Section 11, the Bank hereby agrees that it shall promptly take, at Pledgor’s
sole cost and expense, all reasonable actions necessary to facilitate the
transfer of any funds in the Designated Accounts as follows: (a) in the case of
a termination of this Control Agreement under Section 11(i), to the institution
designated in writing by Pledgor; and (b) in all other cases, to the institution
designated in writing by the Collateral Agent.

 

-4-

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

Section 12. Fees and Expenses. The Bank agrees to look solely to the Designated
Accounts and the Pledgor for payment of any and all fees, costs, charges and
expenses incurred or otherwise relating to the Designated Accounts and services
provided by the Bank hereunder (collectively, the “Account Expenses”), and the
Pledgor agrees to pay such Account Expenses to the Bank on demand therefor. The
Pledgor acknowledges and agrees that it shall be, and at all times remains,
solely liable to the Bank for all Account Expenses.

Section 13. Severability. If any term or provision set forth in this Control
Agreement shall be invalid or unenforceable, the remainder of this Control
Agreement, other than those provisions held invalid or unenforceable, shall be
construed in all respects as if such invalid or unenforceable term or provision
were omitted.

Section 14. Counterparts. This Control Agreement may be executed in any number
of counterparts, all of which shall constitute one and the same instrument, and
any party hereto may execute this Control Agreement by signing and delivering
one or more counterparts.

[signature page follows]

 

-5-

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

[                        ]

By:

 

 

  Name:   Title:

 

JPMORGAN CHASE BANK, N.A.,

as Collateral Agent

By:

 

 

  Name:   Title:

 

[                         ],

as Bank

By:

 

 

  Name:   Title:

 

S-1

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

SCHEDULE 1

Designated Account(s)

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

EXHIBIT 6

[Form of]

Copyright Security Agreement

This COPYRIGHT SECURITY AGREEMENT (this “Copyright Security Agreement”), dated
as of [                ], by [                ] and [                ]
(individually, a “Pledgor”, and, collectively, the “Pledgors”), in favor of
JPMorgan Chase Bank, N.A., in its capacity as collateral agent pursuant to the
Credit Agreement (in such capacity, the “Collateral Agent”).

W I T N E S S E T H:

WHEREAS, the Pledgors are party to a Security Agreement of even date herewith
(the “Security Agreement”) in favor of the Collateral Agent pursuant to which
the Pledgors are required to execute and deliver this Copyright Security
Agreement;

NOW, THEREFORE, in consideration of the premises and to induce the Collateral
Agent, for the benefit of the Secured Parties, to enter into the Credit
Agreement, the Pledgors hereby agree with the Collateral Agent as follows:

SECTION 1. Defined Terms. Unless otherwise defined herein, terms defined in the
Security Agreement and used herein have the meaning given to them in the
Security Agreement.

SECTION 2. Grant of Security Interest in Copyright Collateral. Each Pledgor
hereby pledges and grants to the Collateral Agent for the benefit of the Secured
Parties a lien on and security interest in and to all of its right, title and
interest in, to and under all the following Pledged Collateral of such Pledgor:

(a) Copyrights of such Pledgor listed on Schedule I1 attached hereto; and

(b) all Proceeds of any and all of the foregoing (other than Excluded Property).

SECTION 3. Security Agreement. The security interest granted pursuant to this
Copyright Security Agreement is granted in conjunction with the security
interest granted to the Collateral Agent pursuant to the Security Agreement and
Pledgors hereby acknowledge and affirm that the rights and remedies of the
Collateral Agent with respect to the security interest in the Copyrights made
and granted hereby are more fully set forth in the Security Agreement, the terms
and provisions of which are incorporated by reference herein as if fully set
forth herein. In the event that any provision of this Copyright Security
Agreement is deemed to conflict with the Security Agreement, the provisions of
the Security Agreement shall control unless the Collateral Agent shall otherwise
determine.

SECTION 4. Termination. Upon the payment in full of the Secured Obligations and
termination of the Security Agreement or upon the release, pursuant to
Section 11.4 of the Security

 

1  Should include same Copyrights listed on Schedule 12(b) of the Perfection
Certificate.

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

Agreement, of the Lien created by the Security Agreement against any of the
Copyrights, the Collateral Agent shall execute, acknowledge, and deliver to the
Pledgors an instrument in writing in recordable form releasing the collateral
pledge, grant, assignment, lien and security interest in the applicable
Copyrights under this Copyright Security Agreement.

SECTION 5. Counterparts. This Copyright Security Agreement may be executed in
any number of counterparts, all of which shall constitute one and the same
instrument, and any party hereto may execute this Copyright Security Agreement
by signing and delivering one or more counterparts.

[signature page follows]

 

-2-

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

IN WITNESS WHEREOF, each Pledgor has caused this Copyright Security Agreement to
be executed and delivered by its duly authorized offer as of the date first set
forth above.

 

Very truly yours, [PLEDGORS]2

By:

 

 

  Name:   Title:

 

Accepted and Agreed:

JPMORGAN CHASE BANK, N.A.,

as Collateral Agent

By:

 

 

  Name:   Title:

 

2  This document needs only to be executed by the Borrower and/or any Guarantor
which owns a pledged Copyright.

 

-3-

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

SCHEDULE I

to

COPYRIGHT SECURITY AGREEMENT

COPYRIGHT REGISTRATIONS AND COPYRIGHT APPLICATIONS

Copyright Registrations:

 

OWNER

  

REGISTRATION
NUMBER

    

TITLE

       

Copyright Applications:

 

OWNER

  

TITLE

    

 

-4-

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EXHIBIT 7

[Form of]

Patent Security Agreement

This PATENT SECURITY AGREEMENT (this “Patent Security Agreement”), dated as of
[                ], by [                ] and [                ] (individually,
a “Pledgor”, and, collectively, the “Pledgors”), in favor of JPMorgan Chase
Bank, N.A., in its capacity as collateral agent pursuant to the Credit Agreement
(in such capacity, the “Collateral Agent”).

W I T N E S S E T H:

WHEREAS, the Pledgors are party to a Security Agreement of even date herewith
(the “Security Agreement”) in favor of the Collateral Agent pursuant to which
the Pledgors are required to execute and deliver this Patent Security Agreement;

NOW, THEREFORE, in consideration of the premises and to induce the Collateral
Agent, for the benefit of the Secured Parties, to enter into the Credit
Agreement, the Pledgors hereby agree with the Collateral Agent as follows:

SECTION 1. Defined Terms. Unless otherwise defined herein, terms defined in the
Security Agreement and used herein have the meaning given to them in the
Security Agreement.

SECTION 2. Grant of Security Interest in Patent Collateral. Each Pledgor hereby
pledges and grants to the Collateral Agent for the benefit of the Secured
Parties a lien on and security interest in and to all of its right, title and
interest in, to and under all the following Pledged Collateral of such Pledgor:

(a) Patents of such Pledgor listed on Schedule I3 attached hereto; and

(b) all Proceeds of any and all of the foregoing (other than Excluded Property).

SECTION 3. Security Agreement. The security interest granted pursuant to this
Patent Security Agreement is granted in conjunction with the security interest
granted to the Collateral Agent pursuant to the Security Agreement and Pledgors
hereby acknowledge and affirm that the rights and remedies of the Collateral
Agent with respect to the security interest in the Patents made and granted
hereby are more fully set forth in the Security Agreement, the terms and
provisions of which are incorporated by reference herein as if fully set forth
herein. In the event that any provision of this Patent Security Agreement is
deemed to conflict with the Security Agreement, the provisions of the Security
Agreement shall control unless the Collateral Agent shall otherwise determine.

SECTION 4. Termination. Upon the payment in full of the Secured Obligations and
termination of the Security Agreement or upon the release, pursuant to
Section 11.4 of the Security

 

3  Should include Patents listed on Schedule 12(a) of the Perfection
Certificate.

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

Agreement, of the Lien created by the Security Agreement against any of the
Patents, the Collateral Agent shall execute, acknowledge, and deliver to the
Pledgors an instrument in writing in recordable form releasing the collateral
pledge, grant, assignment, lien and security interest in the applicable Patents
under this Patent Security Agreement.

SECTION 5. Counterparts. This Patent Security Agreement may be executed in any
number of counterparts, all of which shall constitute one and the same
instrument, and any party hereto may execute this Patent Security Agreement by
signing and delivering one or more counterparts.

[signature page follows]

 

-2-

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IN WITNESS WHEREOF, each Pledgor has caused this Patent Security Agreement to be
executed and delivered by its duly authorized offer as of the date first set
forth above.

 

Very truly yours,

[PLEDGORS]4

By:

 

 

  Name:   Title:

 

Accepted and Agreed:

JPMORGAN CHASE BANK, N.A.,

as Collateral Agent

By:  

 

  Name:   Title:

 

4  This document needs only to be executed by the Borrower and/or any Guarantor
which owns a pledged Patent.

 

-3-

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

SCHEDULE I

to

PATENT SECURITY AGREEMENT

PATENT REGISTRATIONS AND PATENT APPLICATIONS

Patent Registrations:

 

OWNER

   REGISTRATION
NUMBER      NAME        

Patent Applications:

 

OWNER

   APPLICATION
NUMBER      NAME        

 

-4-

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EXHIBIT 8

[Form of]

Trademark Security Agreement

This TRADEMARK SECURITY AGREEMENT (this “Trademark Security Agreement”), dated
as of [                ], by [                ] and [                ]
(individually, a “Pledgor”, and, collectively, the “Pledgors”), in favor of
JPMorgan Chase Bank, N.A., in its capacity as collateral agent pursuant to the
Credit Agreement (in such capacity, the “Collateral Agent”).

W I T N E S S E T H:

WHEREAS, the Pledgors are party to a Security Agreement of even date herewith
(the “Security Agreement”) in favor of the Collateral Agent pursuant to which
the Pledgors are required to execute and deliver this Trademark Security
Agreement;

NOW, THEREFORE, in consideration of the premises and to induce the Collateral
Agent, for the benefit of the Secured Parties, to enter into the Credit
Agreement, the Pledgors hereby agree with the Collateral Agent as follows:

SECTION 1. Defined Terms. Unless otherwise defined herein, terms defined in the
Security Agreement and used herein have the meaning given to them in the
Security Agreement.

SECTION 2. Grant of Security Interest in Trademark Collateral. Each Pledgor
hereby pledges and grants to the Collateral Agent for the benefit of the Secured
Parties a lien on and security interest in and to all of its right, title and
interest in, to and under all the following Pledged Collateral of such Pledgor:

(a) Trademarks of such Pledgor listed on Schedule I5 attached hereto;

(b) all Goodwill associated with such Trademarks; and

(c) all Proceeds of any and all of the foregoing (other than Excluded Property).

SECTION 3. Security Agreement. The security interest granted pursuant to this
Trademark Security Agreement is granted in conjunction with the security
interest granted to the Collateral Agent pursuant to the Security Agreement and
Pledgors hereby acknowledge and affirm that the rights and remedies of the
Collateral Agent with respect to the security interest in the Trademarks made
and granted hereby are more fully set forth in the Security Agreement, the terms
and provisions of which are incorporated by reference herein as if fully set
forth herein. In the event that any provision of this Trademark Security
Agreement is deemed to conflict with the Security Agreement, the provisions of
the Security Agreement shall control unless the Collateral Agent shall otherwise
determine.

 

5  Should include same Trademarks listed on Schedule 12(a) of the Perfection
Certificate.

 

A-5

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SECTION 4. Termination. Upon the payment in full of the Secured Obligations and
termination of the Security Agreement or upon the release, pursuant to
Section 11.4 of the Security Agreement, of the Lien created by the Security
Agreement against any of the Trademarks, the Collateral Agent shall execute,
acknowledge, and deliver to the Pledgors an instrument in writing in recordable
form releasing the collateral pledge, grant, assignment, lien and security
interest in the applicable Trademarks under this Trademark Security Agreement.

SECTION 5. Counterparts. This Trademark Security Agreement may be executed in
any number of counterparts, all of which shall constitute one and the same
instrument, and any party hereto may execute this Trademark Security Agreement
by signing and delivering one or more counterparts.

[signature page follows]

 

A-6

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IN WITNESS WHEREOF, each Pledgor has caused this Trademark Security Agreement to
be executed and delivered by its duly authorized offer as of the date first set
forth above.

 

Very truly yours,

[PLEDGORS]6

By:

 

 

  Name:   Title:

 

Accepted and Agreed:

JPMORGAN CHASE BANK, N.A.,

as Collateral Agent

By:

 

 

  Name:   Title:

 

6  This document needs only to be executed by the Borrower and/or any Guarantor
which owns a pledged Trademark.

 

A-7

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SCHEDULE I

to

TRADEMARK SECURITY AGREEMENT

TRADEMARK REGISTRATIONS AND TRADEMARK APPLICATIONS

Trademark Registrations:

 

OWNER

   REGISTRATION
NUMBER      TRADEMARK        

Trademark Applications:

 

OWNER

   APPLICATION
NUMBER      TRADEMARK        

 

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EXHIBIT B

[Form of]

COMPLIANCE CERTIFICATE

I, [                ], the [Chief Financial Officer] of DaVita Inc. (in such
capacity and not in my individual capacity), hereby certify that, with respect
to that certain Credit Agreement dated as of October 20, 2010 (as it may be
amended, modified, extended or restated from time to time, the “Credit
Agreement”; all of the defined terms in the Credit Agreement are incorporated
herein by reference) among DaVita Inc., a Delaware corporation, as borrower (the
“Borrower”), the Guarantors party thereto, the Lenders party thereto, JPMorgan
Chase Bank, N.A., as Administrative Agent and Collateral Agent, and the other
agents party thereto:

a. Attached hereto as Schedule 1 are detailed calculations7 demonstrating
compliance by Borrower with Sections 7.6(e), 7.12 and 7.16 of the Credit
Agreement and showing a reconciliation of Consolidated EBITDA to net income.
Borrower is in compliance with such Sections as of the date hereof. [Attached
hereto as Schedule 2 are detailed calculations setting forth (i) the Borrower’s
Excess Cash Flow, (ii) the Available Amount and (iii) that portion of the
Available Amount that has been utilized pursuant to Sections 7.6(k)(i)(z),
7.7(d)(i) and 7.9(a)(ii)(x) of the Credit Agreement.]8 [Attached hereto as
Schedule 3 is the report of [accounting firm.]]9

b. The Borrower was in compliance with each of the covenants set forth in
Sections 7.12 and 7.16 of the Credit Agreement at all times during and since
[                        ].

c. No Default has occurred under the Credit Agreement which has not been
previously disclosed, in writing, to the Administrative Agent pursuant to a
Compliance Certificate.10

 

 

7 

Which calculations shall be in reasonable detail satisfactory to the
Administrative Agent and shall include, among other things, an explanation of
the methodology used in such calculations and a breakdown of the components of
such calculations.

8 

To accompany annual financial statements only, commencing with the Fiscal Year
ending December 31, 2011.

9 

To accompany annual financial statements only. The report must opine or certify
that, with respect to its regular audit of such financial statements, which
audit was conducted in accordance with GAAP, the accounting firm obtained no
knowledge that any Default has occurred or, if in the opinion of such accounting
firm such a Default has occurred, specifying the nature and extent thereof.

10 

If a Default shall have occurred, an explanation specifying the nature and
extent of such Default shall be provided on a separate page together with an
explanation of the corrective action taken or proposed to be taken with respect
thereto (include, as applicable, information regarding actions, if any, taken
since prior certificate).

 

B-1

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Dated this [    ] day of [                ], 20[    ].

 

DAVITA INC.

By:

 

 

  Name:     Title:   [Chief Financial Officer]

 

B-2

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SCHEDULE 1

Financial Covenants

 

(A)   Maximum Leverage Ratio: Debt to Consolidated EBITDA

  

1.      Debt calculation:

  

(i)     Funded Debt of Borrower and its Subsidiaries [explanation of differences
from balance sheet debt]

  

 

(i) includes: Government Reimbursement Program Costs (exclusive of those paid in
such period)

  

 

Loans

  

 

Receivables Transaction Amounts

  

 

preferred Capital Stock obligations11

  

 

Plus

  

(ii)    Letters of Credit (to the extent not included in (i));

  

 

Minus

  

(iii)  cash and Cash Equivalents of Borrower and its Subsidiaries

  

 

Debt for the Measurement Period:   

 

2.      Consolidated EBITDA calculation:

  

 

(i)     Consolidated EBITDA

  

(a)    Consolidated Net Income of Borrower and its Subsidiaries

  

 

plus (each of (b) — (l) to the extent deducted from Consolidated Net Income for
such period)   

(b)    Consolidated Interest Expense of Borrower and its Subsidiaries (including
any cash charges for refinancing any of the Obligations)

  

 

 

11  But excludes Contingent Obligations permitted under Section 7.2 of the
Credit Agreement.

 

B-3

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(c)    income tax expense of Borrower and its Subsidiaries

  

 

(d)    depreciation expense of Borrower and its Subsidiaries

  

 

(e)    amortization expense of Borrower and its Subsidiaries

  

 

(f)     cash fees, expenses, charges, debt extinguishment costs and other costs
incurred in connection with the Transactions expensed prior to January 1, 2011

  

 

(g)    other non-cash charges reducing Consolidated Net Income (excluding
certain charges that result in accruals) (excluding write-offs of current assets
of Borrower and its Subsidiaries)

  

 

(h)    consolidated expenses for valuation adjustments or impairment charges

  

 

(i)     expenses and charges relating to non-controlling interests and equity
income in Subsidiaries

  

 

(j)     extraordinary losses subtracted in determining Consolidated Net Income

  

 

(k)    any losses of a Person (other than a Subsidiary) in which the Borrower or
any of its Subsidiaries has an ownership interest that is accounted for using
the equity method

  

 

(l)     cash fees, expenses, charges, debt extinguishment costs and other costs
incurred in connection with any Investments permitted by Section 7.6(e), (f) or
(j)

  

 

Minus

  

(m)   extraordinary gains added in determining Consolidated Net Income of
Borrower and its Subsidiaries

  

 

Minus

  

 

B-4

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(n)    aggregate amount of all non-cash items increasing Consolidated Net Income
(other than accrual of revenue or recording of receivables in the ordinary
course of business)

  

 

Consolidated EBITDA for Measurement Period:

  

 

Leverage Ratio for Measurement Period:

   [            ] to 1.00

Covenant Requirement for Measurement Period:

   [            ] to 1.00

(B)   Minimum Interest Coverage Ratio: Consolidated EBITDA to Consolidated
Interest Expense

  

Consolidated EBITDA for Measurement Period:

  

 

Consolidated Interest Expense:

  

gross consolidated interest expense accrued on all Debt of Borrower and its
Subsidiaries under GAAP

  

 

includes:

  

(a)    fees under Section 2.8 of Credit Agreement

  

 

(b)    commissions, discounts and fees and other amounts paid or payable under
letters of credit (including the Letters of Credit)

  

 

(c)    amortization of original issue discount of all Debt of Borrower and its
Subsidiaries

  

 

(d)    dividends on Redeemable Preferred Interests (to the extent paid or
payable in cash)

  

 

(e)    commissions, discounts, yield and other fees incurred in connection with
Permitted Receivables Financings payable to any Person other than a Loan Party

  

 

(f)     imputed interest on Capitalized Lease Obligations of Borrower and its
Subsidiaries

  

 

(g)    cash contributions to any employee stock ownership plan or trust, to the
extent such contributions are used to pay interest or fees to anyone other than
Borrower and its Subsidiaries in connection with Debt incurred by such plan or
trust

  

 

 

B-5

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minus

  

(h)        interest income of the Borrower and its Subsidiaries received upon
cash and Cash Equivalents

  

 

Consolidated Interest Coverage Ratio for Measurement Period:

   [            ] to 1.00

Covenant Requirement for Measurement Period:

   Not less than 3.00 to 1.00

(C)       Limitation on Capital Expenditures

  

Capital Expenditures for Measurement Period:

  

 

Covenant Requirement for Measurement Period:

   No more than $[            ]

Carryover Amount:

  

 

 

B-6

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EXHIBIT C

[Form of]

SOLVENCY CERTIFICATE

I, the undersigned, the chief financial officer of DaVita Inc., a Delaware
corporation (“Borrower”), DO HEREBY CERTIFY on behalf of Borrower that:

1. This Certificate is furnished pursuant to Section 5.1(g) of the Credit
Agreement, (as in effect on the date of this Certificate); the capitalized terms
defined therein being used herein as therein defined) dated as of October 20,
2010 among DaVita Inc., a Delaware corporation (“Borrower”) and the Guarantors,
the Lenders, JPMorgan Chase Bank, N.A., as Administrative Agent and Collateral
Agent, and the other agents party thereto (as from time to time in effect, the
“Credit Agreement”).

2. Immediately following the consummation of the Transactions and immediately
following the making of each Loan on the date hereof and after giving effect to
the application of the proceeds of each Loan on the date hereof; (a) the amount
of the “present fair saleable value” of the assets of each Loan Party
(individually and on a Consolidated basis with its Subsidiaries) will exceed the
amount of all “liabilities of such Loan Party, contingent or otherwise”, as such
quoted terms are determined in accordance with applicable federal and state laws
governing determinations of the insolvency of debtors; (b) the present fair
saleable value of the assets of each Loan Party will be greater than the amount
that will be required to pay the liability of such Loan Party on its debts as
such debts become absolute and matured; (c) each Loan Party will not have an
unreasonably small amount of capital with which to conduct its business; and
(d) each Loan Party will be able to pay its debts as they mature. For purposes
of this certificate, (i) “debt” means liability on a “claim,” and (ii) “claim”
means any (x) right to payment, whether or not such a right is reduced to
judgment, liquidated, unliquidated, fixed, contingent, matured, unmatured,
disputed, undisputed, legal, equitable, secured or unsecured or (y) right to an
equitable remedy for breach of performance if such breach gives rise to a right
to payment, whether or not such right to an equitable remedy is reduced to
judgment, fixed, contingent, matured or unmatured, disputed, undisputed, secured
or unsecured.

[Signature Page Follows]

 

C-1

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IN WITNESS WHEREOF, I have hereunto set my hand this [    ]th day of
[                ].

DAVITA INC.

 

By:  

 

  Name:     Title:   [Chief Financial Officer]

 

C-2

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EXHIBIT D

[Reserved]

 

D-1

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EXHIBIT E

[Form of]

ASSIGNMENT AND ASSUMPTION

This Assignment and Assumption (the “Assignment and Assumption”) is dated as of
the Effective Date set forth below and is entered into by and between [Insert
name of Assignor] (the “Assignor”) and [Insert name of Assignee] (the
“Assignee”). Capitalized terms used but not defined herein shall have the
meanings given to them in the Credit Agreement defined below, receipt of a copy
of which is hereby acknowledged by the Assignee. The Standard Terms and
Conditions set forth in Annex 1 attached hereto are hereby agreed to and
incorporated herein by reference and made a part of this Assignment and
Assumption as if set forth herein in full.

For an agreed consideration, the Assignor hereby irrevocably sells and assigns
to the Assignee, and the Assignee hereby irrevocably purchases and assumes from
the Assignor, subject to and in accordance with the Standard Terms and
Conditions and the Credit Agreement, as of the Effective Date inserted by the
Administrative Agent as contemplated below, (i) all of the Assignor’s rights and
obligations in its capacity as a Lender under the Credit Agreement and any other
documents or instruments delivered pursuant thereto to the extent related to the
amount and percentage interest identified below of all of such outstanding
rights and obligations of the Assignor under the respective facilities
identified below (including participations in any Letters of Credit and
Swingline Loans included in such facilities) and (ii) to the extent permitted to
be assigned under applicable law, all claims, suits, causes of action and any
other right of the Assignor (in its capacity as a Lender) against any person,
whether known or unknown, arising under or in connection with the Credit
Agreement, any other documents or instruments delivered pursuant thereto or the
loan transactions governed thereby or in any way based on or related to any of
the foregoing, including, but not limited to, contract claims, tort claims,
malpractice claims, statutory claims and all other claims at law or in equity
related to the rights and obligations sold and assigned pursuant to clause
(i) above (the rights and obligations sold and assigned pursuant to clauses
(i) and (ii) above being referred to herein collectively as, the “Assigned
Interest”). Such sale and assignment is without recourse to the Assignor and,
except as expressly provided in this Assignment and Assumption, without
representation or warranty by the Assignor.

 

1.    Assignor:   

 

   2.    Assignee:   

 

         [and is an Affiliate/Approved Fund of [identify Lender]12]    3.   
Borrower(s):    DaVita Inc.    4.    Administrative Agent:    JPMorgan Chase
Bank, N.A., as the administrative agent under the Credit Agreement    5.   
Credit Agreement:    The Credit Agreement dated as of October 20, 2010 (as
amended, amended and restated, supplemented or otherwise modified from time to
time, the “Credit   

 

12 

Select as applicable.

 

E-1

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      Agreement”) among DaVita Inc., a Delaware corporation (“Borrower”), the
Guarantors (such term and each other capitalized term used but not defined
herein having the meaning given it in Section 1 of the Credit Agreement), the
Lenders, JPMorgan Chase Bank, N.A., as Administrative Agent and Collateral
Agent, and the other agents party thereto.

 

6. Assigned Interest:

 

Facility Assigned

   Aggregate Amount  of
Commitment/
Loans for all Lenders      Amount of
Commitment/
Loans Assigned      Percentage
Assigned of
Commitment/Loans13  

Tranche A Term Facility

   $         $           %   

Tranche B Term Facility

   $         $           %   

Dollar Revolving Facility

   $         $           %   

Alternative Currency Revolving Facility

   $         $           %   

[Page break]

 

13 

Set forth, to at least 9 decimals, as a percentage of the Commitment/Loans of
all Lenders thereunder.

 

E-2

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Effective Date:                      , 20     [TO BE INSERTED BY ADMINISTRATIVE
AGENT AND WHICH SHALL BE THE EFFECTIVE DATE OF RECORDATION OF TRANSFER IN THE
REGISTER THEREFOR.]14

The terms set forth in this Assignment and Assumption are hereby agreed to:

 

ASSIGNOR [NAME OF ASSIGNOR] By:  

 

  Title: ASSIGNEE [NAME OF ASSIGNEE] By:  

 

  Title:

 

Consented to and Accepted: [DAVITA INC. By:  

 

  Name:   Title: ] 15

 

14 

This date may not be fewer than 5 Business days after the date of assignment
unless the Administrative Agent otherwise agrees.

15

To be completed to the extent consent is required under Section 11.6(b) of the
Credit Agreement.

 

E-3

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[JPMORGAN CHASE BANK, N.A.,

as [Administrative Agent]16 [Issuing Lender and Swingline Lender]17

By:  

 

  Name:   Title: ]

 

 

16 

To be completed to the extent consent is required under Section 11.6(b) of the
Credit Agreement.

17 

Reference to Issuing Lender and Swingline Lender required for an assignment of
Revolving Commitments.

 

E-4

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ANNEX 1 to Assignment and Assumption

DAVITA INC.

CREDIT AGREEMENT

STANDARD TERMS AND CONDITIONS FOR

ASSIGNMENT AND ASSUMPTION

1. Representations and Warranties.

1.1 Assignor. The Assignor (a) represents and warrants that (i) it is the legal
and beneficial owner of the Assigned Interest, (ii) the Assigned Interest is
free and clear of any lien, encumbrance or other adverse claim and (iii) it has
full power and authority, and has taken all action necessary, to execute and
deliver this Assignment and Assumption and to consummate the transactions
contemplated hereby; and (b) assumes no responsibility with respect to (i) any
statements, warranties or representations made in or in connection with the
Credit Agreement or any other Loan Document, (ii) the execution, legality,
validity, enforceability, genuineness, sufficiency or value of the Loan
Documents or any collateral thereunder, (iii) the financial condition of the
Borrower, any of their Subsidiaries or Affiliates or any other person obligated
in respect of any Loan Document or (iv) the performance or observance by the
Borrower, any of their Subsidiaries or Affiliates or any other person of any of
their respective obligations under any Loan Document.

1.2. Assignee. The Assignee (a) represents and warrants that (i) it has full
power and authority, and has taken all action necessary, to execute and deliver
this Assignment and Assumption and to consummate the transactions contemplated
hereby and to become a Lender under the Credit Agreement, (ii) it meets all
requirements of an eligible assignee under the Credit Agreement (subject to
receipt of such consents as may be required under the Credit Agreement),
(iii) from and after the Effective Date, it shall be bound by the provisions of
the Credit Agreement as a Lender thereunder and, to the extent of the Assigned
Interest, shall have the obligations of a Lender thereunder, (iv) it has
received a copy of the Credit Agreement, together with copies of the most recent
financial statements referred to in Section 4.7 thereof or delivered pursuant to
Section 6.1 thereof, as applicable, and such other documents and information as
it has deemed appropriate to make its own credit analysis and decision to enter
into this Assignment and Assumption and to purchase the Assigned Interest on the
basis of which it has made such analysis and decision independently and without
reliance on the Administrative Agent, the Assignor or any other Lender, (v) if
it is not already a Lender under the Credit Agreement, attached to the
Assignment and Assumption an Administrative Questionnaire, (vi) the
Administrative Agent has received a processing and recordation fee of $3,500 as
of the Effective Date, (vii) if it is a Non-U.S. Lender, attached to the
Assignment and Assumption is any documentation required to be delivered by it
pursuant to Section 2.19 of the Credit Agreement, duly completed and executed by
the Assignee and (viii) it is not a Disqualified Lender or an affiliate of a
Disqualified Lender; and (b) agrees that (i) it will, independently and without
reliance on the Administrative Agent, the Assignor or any other Lender, and
based on such documents and information as it shall deem appropriate at the
time, continue to make its own credit decisions in taking or not taking action
under the Loan Documents, and (ii) it will perform in accordance with their
terms all of the obligations that by the terms of the Loan Documents are
required to be performed by it as a Lender.

2. Payments. From and after the Effective Date, the Administrative Agent shall
make all payments in respect of the Assigned Interest (including payments of
principal, interest, fees and other amounts) to the Assignor for amounts that
have accrued to but excluding the Effective Date and to the Assignee for amounts
that have accrued from and after the Effective Date.

 

E-5

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3. General Provisions. This Assignment and Assumption shall be binding upon, and
inure to the benefit of, the parties hereto and their respective successors and
assigns. This Assignment and Assumption may be executed in any number of
counterparts, which together shall constitute one instrument. Delivery of an
executed counterpart of a signature page of this Assignment and Assumption by
telecopy shall be effective as delivery of a manually executed counterpart of
this Assignment and Assumption. This Assignment and Assumption shall be
construed in accordance with and governed by, the law of the State of New York
(including, without limitation, Sections 5-1401 and 5-1402 of the New York
General Obligations Law, but otherwise without regard to conflicts of laws
principles thereof).

 

E-6

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EXHIBIT F

[Form of]

LEGAL OPINIONS

[Provided under separate cover]

 

F-1

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EXHIBIT G

[Form of]

PREPAYMENT OPTION NOTICE

[Lenders]

Re: DaVita Inc.

[Date]

Ladies and Gentlemen:

Reference is made to the Credit Agreement dated as of October 20, 2010 (as
amended, amended and restated, supplemented or otherwise modified from time to
time, the “Credit Agreement”) among DaVita Inc., a Delaware corporation, as
borrower (the “Borrower”), the Guarantors (such term and each other capitalized
term used but not defined herein having the meaning given it in the Credit
Agreement), the Lenders party thereto, JPMorgan Chase Bank, N.A., as
Administrative Agent and Collateral Agent, and the other agents party thereto.
Borrower has provided us with notice pursuant to Section 2.11(e) of the Credit
Agreement that it shall be making a prepayment of Tranche B Term Loans under the
Credit Agreement.

This Prepayment Option Notice constitutes an offer by the Borrower to prepay
Tranche B Term Loans in the amount listed below on the 10th Business Day
following the date hereof.

Please notify the Administrative Agent in writing within [    ] days whether you
accept or decline this offer. Please note that failure to respond to this notice
shall be deemed an acceptance of the prepayment offered to be repaid, as listed
below.

Pursuant to Section 2.11(e) of the Credit Agreement. Borrower shall pay (i) to
the relevant Tranche B Lenders the aggregate amount necessary to prepay that
portion of the outstanding relevant Term Loans in respects of which such Lenders
have accepted prepayment and (ii) to the Tranche A Lenders an amount equal to
the portion of the Tranche B Prepayment Amount not accepted by Tranche B Term
Lenders, and such amount shall be applied to the prepayment of the Tranche A
Term Loans; provided that if after the application of amounts pursuant to clause
(ii), any portion of the Tranche B Prepayment Amount not accepted by the Tranche
B Term Loan Lenders shall remain, such amount shall be used to prepay the
Tranche B Term Loans on a pro rata basis.

 

(A)    Facility and Type of Loan being offered to be prepaid      Tranche B Term
Loan (B)    Percentage of all Tranche B Term Loans offered to be prepaid     

 

(C)    Principal amount of your Tranche B Term Loans offered to be prepaid     

 

(D)    Date of prepayment (which is a Business Day)     

 

 

G-1

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[Signature Page Follows]

 

JPMORGAN CHASE BANK, N.A., as Administrative Agent By:  

 

  Name:   Title:

 

G-2

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EXHIBIT H

[Form of]

BORROWING REQUEST

JPMorgan Chase Bank, N.A.

    as Administrative Agent for

the Lenders referred to below,

c/o JPMorgan Chase Bank, [Loan and Agency Services Group]

1111 Fannin, 10th Floor

Houston, Texas 77002

Attention: Maria Saez

Fax: 713-374-4312

with a copy to:

JPMorgan Chase Bank, N.A.

383 Madison Avenue

New York, New York 10179

Attention: Dawn Lee Lum

Fax: 212-270-3279

Re: DaVita Inc.

[Date]

Ladies and Gentlemen:

Reference is made to the Credit Agreement dated as of October 20, 2010 (as
amended, amended and restated, supplemented or otherwise modified from time to
time, the “Credit Agreement”) among DaVita Inc., a Delaware corporation
(“Borrower”), the Guarantors (such term and each other capitalized term used but
not defined herein having the meaning given it in Section 1 of the Credit
Agreement), the Lenders, JPMorgan Chase Bank, N.A., as Administrative Agent and
Collateral Agent, and the other agents party thereto. Borrower hereby gives you
notice that it requests a Credit Extension pursuant to Section [2.2] [2.5] [2.7]
of the Credit Agreement, and in that connection sets forth below the terms on
which such Credit Extension is requested to be made:

 

(A)   Facility of Credit Extension

  

[Dollar Revolving Facility]

[Alternative Currency Revolving Facility]

[Tranche A Term Facility]

[Tranche B Term Facility]

[Swingline Loan]

  

(B)   Principal amount of
    Credit Extension18

  

 

  

 

18 

Each borrowing under the Dollar Revolving Commitments and each borrowing of
Alternative Currency Revolving Loans denominated in Dollars shall be in an
amount equal to (x) in the case of ABR Loans, $1,000,000 or a whole multiple
thereof (or, if the then aggregate Available Dollar Revolving Commitments or
Available Alternative Currency Revolving Commitments, as applicable, are less
than $1,000,000, such

Footnote continued on next page.

 

H-1

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(D)    Currency       (D)    Date of Credit Extension
    (which is a Business Day)   

 

   (E)    Type of Credit Extension    [ABR] [Eurodollar]19    (F)    Interest
Period and the last day thereof20   

 

   (G)    Funds are requested to be disbursed to Borrower’s account with
JPMorgan
Chase Bank, N.A. (Account No.                ).   

Borrower hereby represents and warrants that the conditions to lending specified
in Sections 5.2(b) and (c) of the Credit Agreement are satisfied as of the date
hereof.

[Signature Page Follows]

 

 

Footnote continued from previous page.

 

     lesser amount) and (y) in the case of Eurodollar Loans, $5,000,000 or a
whole multiple of $1,000,000 in excess thereof. Each borrowing under the
Alternative Currency Revolving Commitments (other than borrowings denominated in
Dollars) should be in an amount equal to the Alternative Currency Equivalent of
$5,000,000 or a whole multiple of $1,000,000 in excess thereof.

19 

Shall be ABR for Swingline Loans.

20 

Shall be subject to the definition of “Interest Period” in the Credit Agreement.

 

H-2

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

DAVITA INC. By:  

 

  Name:   Title: [Responsible Officer]

 

H-3

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

EXHIBIT I

[Form of]

ADDENDUM

Reference is made to the Credit Agreement dated as of October 20, 2010 (as
amended, amended and restated, supplemented or otherwise modified from time to
time, the “Credit Agreement”) among DaVita Inc., a Delaware corporation
(“Borrower”), the Guarantors (such term and each other capitalized term used but
not defined herein having the meaning given it in Section 1 of the Credit
Agreement), the Lenders, JPMorgan Chase Bank, N.A., as Administrative Agent and
Collateral Agent, and the other agents party thereto.

Upon execution and delivery of this Addendum by the parties hereto as provided
in Section 11.19 of the Credit Agreement, the undersigned hereby becomes a
Lender thereunder having the Commitment set forth in Schedule 1 hereto,
effective as of the Closing Date.

THIS ADDENDUM SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAW OF
THE STATE OF NEW YORK (INCLUDING, WITHOUT LIMITATION, SECTIONS 5-1401 AND 5-1402
OF THE NEW YORK GENERAL OBLIGATIONS LAW, BUT OTHERWISE WITHOUT REGARD TO
CONFLICTS OF LAWS PRINCIPLES THEREOF).

This Addendum may be executed by one or more of the parties hereto on any number
of separate counterparts, and all of said counterparts taken together shall be
deemed to constitute one and the same instrument. Delivery of an executed
signature page hereof by facsimile transmission shall be effective as delivery
of a manually executed counterpart hereof.

 

I-1

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

IN WITNESS WHEREOF, the parties hereto have caused this Addendum to be duly
executed and delivered by their proper and duly authorized officers as of this
     day of [                    ], 2010.

 

 

  ,

as a Lender

[Please type legal name of Lender above]

  By:  

 

  Name:     Title:   [If second signature is necessary:]   [By:  

 

  Name:     Title:]  

 

I-2

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

Accepted and agreed: DAVITA INC. By:  

 

  Name:   Title:

JPMORGAN CHASE BANK, N.A., as Administrative Agent

By:  

 

  Name:   Title:

 

I-3

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

Schedule 1

COMMITMENTS AND NOTICE ADDRESS

 

1.    Name of Lender:   

 

         Notice Address:   

 

           

 

           

 

         Attention:   

 

         Telephone:   

 

         Facsimile:   

 

      2.    Tranche A Term Commitment:   

 

   3.    Tranche B Term Commitment:   

 

   4.    Dollar Revolving Commitment:   

 

   5.    Alternative Currency Revolving Commitment:   

 

  

 

I-4

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

EXHIBIT J

[Form of]

EXEMPTION CERTIFICATE

Reference is made to the Credit Agreement dated as of October 20, 2010 (as
amended, amended and restated, supplemented or otherwise modified from time to
time, the “Credit Agreement”) among DaVita Inc., a Delaware corporation
(“Borrower”), the Guarantors (such term and each other capitalized term used but
not defined herein having the meaning given it in Section 1 of the Credit
Agreement), the Lenders, JPMorgan Chase Bank, N.A., as Administrative Agent and
Collateral Agent, and the other agents party thereto.

The undersigned is not (i) a bank (as such term is used in Section 881(c)(3)(A)
of the Internal Revenue Code of 1986, as amended (the “Code”)), (ii) a “10
percent shareholder” of Borrower within the meaning of section 881(c)(3)(B) of
the Code, or (C) a “controlled foreign corporation” described in section
881(c)(3)(C) of the Code.

 

[NAME OF LENDER] By:  

 

  Name:   Title: [ADDRESS]

Dated:                     , 200    .

 

J-1

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

EXHIBIT K-1

PERFECTION CERTIFICATE

Reference is hereby made to (i) that certain Security Agreement dated as of
October 20, 2010 (the “Security Agreement”), between DaVita Inc., a Delaware
limited liability company (“Borrower”), the Guarantors party thereto
(collectively, the “Guarantors”) and the Collateral Agent (as hereinafter
defined) and (ii) that certain Credit Agreement dated as of October 20, 2010
(the “Credit Agreement”) among the Borrower, the Guarantors, certain other
parties thereto and JPMorgan Chase Bank, N.A., as Collateral Agent (in such
capacity, the “Collateral Agent”). Capitalized terms used but not defined herein
have the meanings assigned in the Credit Agreement.

As used herein, the term “Companies” means Borrower and each of its
Subsidiaries.

The undersigned hereby certify to the Collateral Agent as follows:

1. Names. (a) The exact legal name of each Company, as such name appears in its
respective certificate of incorporation or any other organizational document, is
set forth in Schedule 1(a). Each Company is (i) the type of entity disclosed
next to its name in Schedule 1(a) and (ii) a registered organization except to
the extent disclosed in Schedule 1(a). Also set forth in Schedule 1(a) is the
organizational identification number, if any, of each Company that is a
registered organization, the Federal Taxpayer Identification Number of each
Company and the jurisdiction of formation of each Company.

(b) Set forth in Schedule 1(b) hereto are (i) any other corporate or
organizational names each Company has had in the past five years, together with
the date of the relevant change and (ii) any alternate name (including trade
name or similar appellation) used by each Company in the past five years.

(c) Set forth in Schedule 1(c) is a list of all other names (including trade
names or similar appellations) used by each Company, or any other business or
organization to which each Company became the successor by merger,
consolidation, acquisition, change in form, nature or jurisdiction of
organization or otherwise, at any time between [                    , 2005] and
the date hereof. Also set forth in Schedule 1(c) is the information required by
Section 1 of this certificate for any other business or organization to which
each Company became the successor by merger, consolidation, acquisition, change
in form, nature or jurisdiction of organization or otherwise, at any time
between [                    , 2005] and the date hereof. Except as set forth in
Schedule 1(c), no Company has changed its jurisdiction of organization at any
time during the past four months.

2. Current Locations. (a) The chief executive office of each Company is located
at the address set forth in Schedule 2(a) hereto.

(b) Set forth in Schedule 2(b) are all locations where each Company maintains
any books or records relating to any Collateral.

(c) Set forth in Schedule 2(c) hereto are all the other places of business of
each Company.

(d) Set forth in Schedule 2(d) hereto are all other locations where each Company
maintains any of the Collateral consisting of inventory or equipment not
identified above.

3. [Reserved].

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

4. Extraordinary Transactions. Except for those purchases, acquisitions and
other transactions described on Schedule 4 attached hereto, all of the
Collateral has been originated by each Company in the ordinary course of
business or consists of goods which have been acquired by such Company in the
ordinary course of business from a person in the business of selling goods of
that kind.

5. File Search Reports. Attached hereto as Schedule 5 is a true and accurate
summary of file search reports from the Uniform Commercial Code filing offices
in each jurisdiction identified in Schedule 7. A true copy of each financing
statement, including judgment and tax liens or other filing identified in such
file search reports, has been delivered to the Collateral Agent.

6. UCC Filings. The financing statements (duly authorized by each Company
constituting the debtor therein), including the indications of the collateral,
attached as Schedule 6 relating to the Security Agreement or the applicable
Mortgage, are in the appropriate forms for filing in the filing offices in the
jurisdictions identified in Schedule 7 hereto.

7. Schedule of Filings. Attached hereto as Schedule 7 is a schedule of (i) the
appropriate filing offices for the financing statements attached hereto as
Schedule 6 and (ii) the appropriate filing offices for the filings described in
Schedule 12(c) and (iii) any other actions required to create, preserve, protect
and perfect the security interests in the Pledged Collateral (as defined in the
Security Agreement) granted to the Collateral Agent pursuant to the Collateral
Documents. No other filings or actions are required to create, preserve, protect
and perfect the security interests in the Pledged Collateral granted to the
Collateral Agent pursuant to the Collateral Documents.

8. Real Property. Attached hereto as Schedule 8(a) is a list of all real
property owned by each Company noting Mortgaged Property as of the Closing Date.
Except as described on Schedule 8(b) attached hereto, no Company has entered
into any leases, subleases, tenancies, franchise agreements, licenses or other
occupancy arrangements as owner, lessor, sublessor, licensor, franchisor or
grantor with respect to any of the real property described on Schedule 8(a).

9. Termination Statements. Attached hereto as Schedule 9(a) are the duly
authorized termination statements in the appropriate form for filing in each
applicable jurisdiction identified in Schedule 9(b) hereto with respect to each
Lien described therein.

10. Stock Ownership and Other Equity Interests. Attached hereto as Schedule
10(a) is a true and correct list of each of all of the authorized, and the
issued and outstanding, stock, partnership interests, limited liability company
membership interests or other equity interest of each Company and its
Subsidiaries and the record and beneficial owners of such stock, partnership
interests, membership interests or other equity interests. Also set forth on
Schedule 10(b) is each equity investment of each Company that represents 50% or
less of the equity of the entity in which such investment was made and which is
not required to be consolidated on the Borrower’s Consolidated financial
statements or is not otherwise Controlled by the Borrower or one or more if its
Subsidiaries.

11. Instruments and Tangible Chattel Paper. Attached hereto as Schedule 11 is a
true and correct list of all promissory notes, instruments (other than checks to
be deposited in the ordinary course of business), tangible chattel paper,
electronic chattel paper and other evidence of indebtedness held by each Pledgor
(as defined in the Security Agreement) as of the date hereof, including all
intercompany notes between or among any two or more Pledgors.

12. Intellectual Property. (a) Attached hereto as Schedule 12(a) is a schedule
setting forth all of each Company’s Patents, Patent Licenses, Trademarks and
Trademark Licenses (each as defined in the Security Agreement) registered with
the United States Patent and Trademark Office, including the name

 

-2-

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

of the registered owner and the registration number of each Patent, Patent
License, Trademark and Trademark License owned by each Company. Attached hereto
as Schedule 12(b) is a schedule setting forth all of each Company’s United
States Copyrights and Copyright Licenses (each as defined in the Security
Agreement), including the name of the registered owner and the registration
number of each Copyright or Copyright License owned by each Company.

(b) Attached hereto as Schedule 12(c) in proper form for filing with the United
States Patent and Trademark Office and United States Copyright Office are the
filings necessary to preserve, protect and perfect the security interests in the
United States Trademarks, Trademark Licenses, Patents, Patent Licenses,
Copyrights and Copyright Licenses set forth on Schedule 12(a) and Schedule
12(b), including duly signed copies of each of the Patent Security Agreement,
Trademark Security Agreement and the Copyright Security Agreement, as
applicable.

13. Commercial Tort Claims. Attached hereto as Schedule 13 is a true and correct
list of all Commercial Tort Claims (as defined in the Security Agreement) held
by each Company, including a brief description thereof.

14. Deposit Accounts, Securities Accounts and Commodity Accounts. Attached
hereto as Schedule 14 is a true and complete list of all Deposit Accounts,
Securities Accounts and Commodity Accounts (each as defined in the Security
Agreement) maintained by each Pledgor, including the name of each institution
where each such account is held, the name of each such account and the name of
each entity that holds each account.

15. Letter-of-Credit Rights. Attached hereto as Schedule 15 is a true and
correct list of all Letters of Credit issued in favor of each Company, as
beneficiary thereunder.

16. Motor Vehicles. Attached hereto as Schedule 16 is a true and correct list of
all motor vehicles (covered by certificates of title or ownership) valued at
over $100,000 and owned by each Company, and the owner and approximate value of
such motor vehicles.

[The Remainder of this Page has been intentionally left blank]

 

-3-

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

IN WITNESS WHEREOF, we have hereunto signed this Perfection Certificate as of
this      day of                 , 20    .

 

DAVITA INC. By:  

 

  Name:   Title: [Each of the Guarantors] By:  

 

  Name:   Title:

 

-4-

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

Schedule 1(a)

Legal Names, Etc.

 

Legal Name

   Type of Entity      Registered
Organization
(Yes/No)      Organizational
Number21      Federal
Taxpayer
Identification
Number      State of Formation      Principal Place of
Business                                                        

 

21 

If none, so state.

 

-5-

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

Schedule 1(b)

Prior Organizational Names

 

Company/Subsidiary

  

Prior Name

  

Date of Change

                            

 

K-1-1

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

Schedule 1(c)

Changes in Corporate Identity; Other Names

 

Company/Subsidiary

  

Corporate Name of
Entity

  

Action

  

Date of

Action

  

State of

Formation

  

List of All Other Names
Used During Past Five
Years

                                                                                
                                                     

[Add Information required by Section 1 to the extent required by Section 1(c) of
the Perfection Certificate]

 

K-1-2

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

Schedule 2(a)

Chief Executive Offices

 

Company/Subsidiary

  

Address

  

County

  

State

                                                     

 

K-1-3

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

Schedule 2(b)

Location of Books

 

Company/Subsidiary

  

Address

  

County

  

State

                                                     

 

K-1-4

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

Schedule 2(c)

Other Places of Business

 

Company/Subsidiary

  

Address

  

County

  

State

                                   

 

K-1-5

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

Schedule 2(d)

Additional Locations of Equipment and Inventory

 

Company/Subsidiary

  

Address

  

County

  

State

                                   

 

K-1-6

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

Schedule 3

[RESERVED]

 

K-1-7

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

Schedule 4

Transactions Other Than in the Ordinary Course of Business

 

Company/Subsidiary

  

Description of Transaction Including

Parties Thereto

  

Date of Transaction

                 

 

K-1-8

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

Schedule 5

File Search Reports

 

Company/Subsidiary

  

Search Report dated

  

Prepared by

  

Jurisdiction

                          

See attached.

 

K-1-9

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

Schedule 6

Copy of Financing Statements To Be Filed

See attached.

 

K-1-10

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

Schedule 7

Filings/Filing Offices

 

Type of Filing22

  

Entity

  

Applicable Collateral

Document

[Mortgage, Security

Agreement or Other]

  

Jurisdictions

                                   

 

22 

UCC-1 financing statement, fixture filing, mortgage, intellectual property
filing or other necessary filing.

 

K-1-11

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

Schedule 8(a)

Real Property

 

Entity of Record

  

Location Address

  

Owned or

Leased

  

Landlord/Owner

if Leased

  

Description of

Lease Documents

                                                                                
  

 

K-1-12

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

Schedule 8(b)

Leases, Subleases, Tenancies, Franchise agreements, Licenses or Other Occupancy
Arrangements

 

K-1-13

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

Schedule 9(a)

Attached hereto is a true copy of each termination statement filing duly
acknowledged or otherwise identified by the filing officer.

 

K-1-14

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

Schedule 9(b)

Termination Statement Filings

 

Debtor

  

Jurisdiction

  

Secured Party

  

Type of Collateral

  

UCC-1 File

Date

  

UCC-1 File

Number

                                                           

 

K-1-15

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

Schedule 10

(a) Equity Interests of Companies and Subsidiaries

 

Current Legal

Entities Owned

  

Record Owner

  

Certificate No.

  

No. Shares/Interest

  

Percent Pledged

                                               

(b) Other Equity Interests

 

K-1-16

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

Schedule 11

Instruments and Tangible Chattel Paper

 

1. Promissory Notes:

 

Entity

  

Principal Amount

  

Date of Issuance

  

Interest Rate

  

Maturity Date

                                   

 

2. Chattel Paper:

 

K-1-17

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

Schedule 12(a)

Patents and Trademarks

UNITED STATES PATENTS:

Registrations:

 

OWNER

 

REGISTRATION NUMBER

 

DESCRIPTION

          Applications:        

OWNER

 

APPLICATION NUMBER

 

DESCRIPTION

          Licenses:        

LICENSEE

 

LICENSOR

 

REGISTRATION/

APPLICATION NUMBER

 

DESCRIPTION

    

OTHER PATENTS:

 

Registrations:

       

OWNER

 

REGISTRATION NUMBER

 

COUNTRY/STATE

 

DESCRIPTION

     Applications:        

OWNER

 

APPLICATION NUMBER

 

COUNTRY/STATE

 

DESCRIPTION

    

 

K-1-18

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

Licenses:        

LICENSEE

 

LICENSOR

 

COUNTRY/STATE

 

REGISTRATION/
APPLICATION

NUMBER

 

DESCRIPTION

UNITED STATES TRADEMARKS: Registrations:        

OWNER

 

REGISTRATION NUMBER

 

TRADEMARK

          Applications:        

OWNER

 

APPLICATION NUMBER

 

TRADEMARK

          Licenses:        

LICENSEE

 

LICENSOR

 

REGISTRATION/
APPLICATION

NUMBER

 

TRADEMARK

     OTHER TRADEMARKS: Registrations:        

OWNER

 

REGISTRATION NUMBER

 

COUNTRY/STATE

 

TRADEMARK

     Applications:        

OWNER

 

APPLICATION NUMBER

 

COUNTRY/STATE

 

TRADEMARK

    

 

K-1-19

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

Licenses:

 

LICENSEE

 

LICENSOR

 

COUNTRY/STATE

 

REGISTRATION/
APPLICATION

NUMBER

 

TRADEMARK

 

K-1-20

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

Schedule 12(b)

Copyrights

UNITED STATES COPYRIGHTS

Registrations:

 

OWNER

 

TITLE

 

REGISTRATION NUMBER

    

Applications:

 

OWNER

 

APPLICATION NUMBER

         

Licenses:

 

LICENSEE

 

LICENSOR

 

REGISTRATION/

APPLICATION

NUMBER

 

DESCRIPTION

OTHER COPYRIGHTS

Registrations:

 

OWNER

 

COUNTRY/STATE

 

TITLE

 

REGISTRATION NUMBER

Applications:

 

OWNER

 

COUNTRY/STATE

 

APPLICATION NUMBER

    

Licenses:

 

LICENSEE

 

LICENSOR

 

COUNTRY/STATE

 

REGISTRATION/
APPLICATION

NUMBER

 

DESCRIPTION

 

K-1-21

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

Schedule 12(c)

Intellectual Property Filings

 

K-1-22

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

Schedule 13

Commercial Tort Claims

 

K-1-23

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

Schedule 14

Deposit Accounts, Securities Accounts and Commodity Accounts

 

OWNER

  

TYPE OF ACCOUNT

  

BANK OR

INTERMEDIARY

  

ACCOUNT NUMBERS

 

K-1-24

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

Schedule 15

Letter of Credit Rights

 

K-1-25

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

Schedule 16

Motor Vehicles

 

K-1-26

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

EXHIBIT K-2

PERFECTION CERTIFICATE SUPPLEMENT

This Perfection Certificate Supplement, dated as of [                ], 20[    ]
is delivered pursuant to Section 6.14(b) of that certain Credit Agreement dated
as of October 20, 2010 (the “Credit Agreement”) among DaVita Inc. (“the
Borrower”), the Guarantors, certain other parties thereto and JPMorgan Chase
Bank, N.A., as Collateral Agent (in such capacity, the “Collateral Agent”).
Capitalized terms used but not defined herein have the meanings assigned in the
Credit Agreement. As used herein, the term “Companies” means Borrower and each
of its Subsidiaries.

The undersigned hereby certify to the Collateral Agent and each of the other
Secured Parties that, as of the date hereof, there has been no change in the
information described in the Perfection Certificate delivered on the Closing
Date (as supplemented by any perfection certificate supplements delivered prior
to the date hereof, the “Prior Perfection Certificate”), other than as follows:

1. Names. (a) Except as listed on Schedule 1(a) attached hereto and made a part
hereof, (x) Schedule 1(a) to the Prior Perfection Certificate sets forth the
exact legal name of each Company, as such name appears in its respective
certificate of incorporation or any other organizational document; (y) each
Company is (i) the type of entity disclosed next to its name in Schedule 1(a) to
the Prior Perfection Certificate and (ii) a registered organization except to
the extent disclosed in Schedule 1(a) to the Prior Perfection Certificate and
(z) set forth in Schedule 1(a) to the Prior Perfection Certificate is the
organizational identification number, if any, of each Company that is a
registered organization, the Federal Taxpayer Identification Number of each
Company and the jurisdiction of formation of each Company.

(b) Except as listed on Schedule 1(b) attached hereto and made a part hereof,
set forth in Schedule 1(b) of the Prior Perfection Certificate are (i) any other
corporate or organizational names each Company has had in the past five years,
together with the date of the relevant change and (ii) any alternate name
(including trade name or similar appellation) used by each Company in the past
five years.

(c) Except as listed on Schedule 1(c) attached hereto and made a part hereof,
set forth in Schedule 1(c) of the Prior Perfection Certificate is a list of all
other names (including trade names or similar appellations) used by each
Company, or any other business or organization to which each Company became the
successor by merger, consolidation, acquisition, change in form, nature or
jurisdiction of organization or otherwise, at any time between [date five years
from date of perfection certificate] and the date hereof. Also, except as set
forth in Schedule 1(c), set forth in Schedule 1(c) of the Prior Perfection
Certificate is the information required by Section 1 of this certificate for any
other business or organization to which each Company became the successor by
merger, consolidation, acquisition, change in form, nature or jurisdiction of
organization or otherwise, at any time between [date five years from date of
perfection certificate] and the date hereof. Except as set forth in Schedule
1(c), no Company has changed its jurisdiction of organization at any time during
the past four months.

2. Current Locations. (a) Except as listed on Schedule 2(a) attached hereto and
made a part hereof, the chief executive office of each Company is located at the
address set forth in Schedule 2(a) to the Prior Perfection Certificate.

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

(b) Except as listed on Schedule 2(b) attached hereto and made a part hereof,
set forth in Schedule 2(b) of the Prior Perfection Certificate are all locations
where each Company maintains any books or records relating to any Collateral.

(c) Except as listed on Schedule 2(c) attached hereto and made a part hereof,
set forth in Schedule 2(c) of the Prior Perfection Certificate are all the other
places of business of each Company.

(d) Except as listed on Schedule 2(d) attached hereto and made a part hereof,
set forth in Schedule 2(d) of the Prior Perfection Certificate are all other
locations where each Company maintains any of the Collateral consisting of
inventory or equipment not identified above.

3. [Intentionally omitted].

4. Extraordinary Transactions. Except for those purchases, acquisitions and
other transactions described on Schedule 4 attached hereto and on Schedule 4 to
the Prior Perfection Certificate, all of the Collateral has been originated by
each Company in the ordinary course of business or consists of goods which have
been acquired by such Company in the ordinary course of business from a person
in the business of selling goods of that kind.

5. [Intentionally omitted].

6. UCC Filings. Except as listed on Schedule 6 attached hereto and made a part
hereof, the financing statements (duly authorized by each Company constituting
the debtor therein), including the indications of the collateral relating to the
Security Agreement or the applicable Mortgage, are set forth in Schedule 6 to
the Prior Perfection Certificate and are in the appropriate forms for filing in
the filing offices in the jurisdictions identified in Schedule 7 hereto and
thereto.

7. Schedule of Filings. Except as listed on Schedule 7 attached hereto and made
a part hereof, attached to the Prior Perfection Certificate as Schedule 7 is a
schedule of (i) the appropriate filing offices for the financing statements
attached hereto and thereto as Schedule 6 and (ii) the appropriate filing
offices for the filings described in Schedule 12(c) hereto and thereto and
(iii) any other actions required to create, preserve, protect and perfect the
security interests in the Pledged Collateral (as defined in the Security
Agreement) granted to the Collateral Agent pursuant to the Collateral Documents.
No other filings or actions are required to create, preserve, protect and
perfect the security interests in the Pledged Collateral granted to the
Collateral Agent pursuant to the Collateral Documents.

8. Real Property. Except as listed on Schedule 8(a) attached hereto and made a
part hereof, Schedule 8(a) to the Prior Perfection Certificate is a list of all
real property owned by each Company noting Mortgaged Property and filing offices
for Mortgages.

9. Termination Statements. Except as listed on Schedule 9(a) attached hereto and
made a part hereof, Schedule 9(a) to the Prior Perfection Certificate sets forth
the duly authorized termination statements in the appropriate form for filing in
each applicable jurisdiction identified in Schedule 9(b) thereto with respect to
each Lien described therein.

10. Stock Ownership and Other Equity Interests. Except as listed on Schedule
10(a) attached hereto and made a part hereof, Schedule 10(a) to the Prior
Perfection Certificate is a true and correct list of each of all of the
authorized, and the issued and outstanding, stock, partnership interests,
limited liability company membership interests or other equity interest of each
Company and its Subsidiaries and the record and beneficial owners of such stock,
partnership interests, membership interests or other equity interests. Except as
set forth on Schedule 10(b) attached hereto and made a part hereof,

 

-2-

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

Schedule 10(b) to the Prior Perfection Certificate sets forth each equity
investment of each Company that represents 50% or less of the equity of the
entity in which such investment was made and which is not required to be
consolidated on the Borrower’s consolidated financial statements or is not
otherwise controlled by the borrower or one or more if its subsidiaries.

11. Instruments and Tangible Chattel Paper. Except as listed on Schedule 11
attached hereto and made a part hereof, Schedule 11 to the Prior Perfection
Certificate is a true and correct list of all promissory notes, instruments
(other than checks to be deposited in the ordinary course of business), tangible
chattel paper, electronic chattel paper and other evidence of indebtedness held
by each Pledgor (as defined in the Security Agreement) as of the date hereof,
including all intercompany notes between or among any two or more Pledgors.

12. Intellectual Property. (a) Except as listed on Schedule 12(a) attached
hereto and made a part hereof, Schedule 12(a) to the Prior Perfection
Certificate is a schedule setting forth all of each Company’s Patents, Patent
Licenses, Trademarks and Trademark Licenses (each as defined in the Security
Agreement) registered with the United States Patent and Trademark Office,
including the name of the registered owner and the registration number of each
Patent, Patent License, Trademark and Trademark License owned by each Company.
Except as listed on Schedule 12(b) attached hereto and made a part hereof,
Schedule 12(b) to the Prior Perfection Certificate is a schedule setting forth
all of each Company’s United States Copyrights and Copyright Licenses (each as
defined in the Security Agreement), including the name of the registered owner
and the registration number of each Copyright or Copyright License owned by each
Company.

(b) Except as listed on Schedule 12(c) attached hereto and made a part hereof,
attached to the Prior Perfection Certificate as Schedule 12(c) in proper form
for filing with the United States Patent and Trademark Office and United States
Copyright Office are the filings necessary to preserve, protect and perfect the
security interests in the United States Trademarks, Trademark Licenses, Patents,
Patent Licenses, Copyrights and Copyright Licenses set forth on Schedule 12(a)
and Schedule 12(b) hereto and thereto, including duly signed copies of each of
the Patent Security Agreement, Trademark Security Agreement and the Copyright
Security Agreement, as applicable.

13. Commercial Tort Claims. Except as listed on Schedule 13 attached hereto and
made a part hereof, attached to the Prior Perfection Certificate as Schedule 13
is a true and correct list of all Commercial Tort Claims (as defined in the
Security Agreement) held by each Company, including a brief description thereof.

14. Deposit Accounts, Securities Accounts and Commodity Accounts. Except as
listed on Schedule 14 attached hereto and made a part hereof, attached to the
Prior Perfection Certificate as Schedule 14 is a true and complete list of all
Deposit Accounts, Securities Accounts and Commodity Accounts (each as defined in
the Security Agreement) maintained by each Pledgor, including the name of each
institution where each such account is held, the name of each such account and
the name of each entity that holds each account.

15. Letter-of-Credit Rights. Except as listed on Schedule 15 attached hereto and
made a part hereof, attached to the Prior Perfection Certificate as Schedule 15
is a true and correct list of all Letters of Credit issued in favor of each
Company, as beneficiary thereunder.

 

-3-

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

16. Motor Vehicles. Except as listed on Schedule 16 attached hereto and made a
part hereof, attached to the Prior Perfection Certificate as Schedule 16 is a
true and correct list of all motor vehicles (covered by certificates of title or
ownership) valued at over $100,000 and owned by each Company, and the owner and
approximate value of such motor vehicles.

[The Remainder of this Page has been intentionally left blank]

 

-4-

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

IN WITNESS WHEREOF, we have hereunto signed this Perfection Certificate as of
this      day of             , 20[    ].

 

DAVITA, INC. By:  

 

  Name:   Title: [Each of the Guarantors] By:  

 

  Name:   Title:

 

-5-

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

Schedule 1(a)

Legal Names, Etc.

 

Legal Name

  

Type of Entity

  

Registered
Organization

(Yes/No)

  

Organizational
Number23

  

Federal Taxpayer
Identification
Number

  

State of Formation

  

Principal Place of
Business

                                                                                
                                   

 

 

23 

If none, so state.

 

-6-

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

Schedule 1(b)

Prior Organizational Names

 

Company/Subsidiary

  

Prior Name

  

Date of Change

                       

 

K-2-1

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

Schedule 1(c)

Changes in Corporate Identity; Other Names

 

Company/Subsidiary

  

Acquired Entity

(i.e., former corporate
name)

  

Action

  

Date of Action

  

State of Formation

of Acquired Entity

                                                     

 

K-2-2

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

Schedule 2(a)

Chief Executive Offices

 

Company/Subsidiary

  

Address

  

County

  

State

                                                                                
                                            

 

K-2-3

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

Schedule 2(b)

Location of Books

 

Company/Subsidiary

  

Address

  

County

  

State

                                                                                
                                            

 

K-2-4

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

Schedule 2(c)

Other Places of Business

 

Company/Subsidiary

  

Address

  

County

  

State

                                                                                
  

 

K-2-5

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

Schedule 2(d)

Additional Locations of Equipment and Inventory

 

Company/Subsidiary

  

Address

  

County

  

State

                                                              

 

K-2-6

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

Schedule 4

Transactions Other Than in the Ordinary Course of Business

 

Company/Subsidiary

  

Description of Transaction Including

Parties Thereto

  

Date of Transaction

                                            

 

K-2-7

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

Schedule 6

Copy of Financing Statements To Be Filed

See attached.

 

K-2-8

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

Schedule 7

Filings/Filing Offices

 

Type of Filing24

  

Entity

  

Applicable Collateral

Document

[Mortgage, Security

Agreement or Other]

  

Jurisdictions

                                                                                
  

 

24 

UCC-1 financing statement, fixture filing, mortgage, intellectual property
filing or other necessary filing.

 

K-2-9

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

Schedule 8(a)

Real Property

 

Entity of Record

  

Location Address

  

Owned or

Leased

  

Landlord/Owner

if Leased

  

Description of

Lease Documents

                                                                                
                                                                                
                          

 

K-2-10

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

Schedule 8(b)

Leases, Subleases, Tenancies, Franchise agreements, Licenses or Other Occupancy
Arrangements

 

K-2-11

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

Schedule 9(a)

Attached hereto is a true copy of each termination statement filing duly
acknowledged or otherwise identified by the filing officer.

 

K-2-12

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

Schedule 9(b)

Termination Statement Filings

 

Debtor

  

Jurisdiction

  

Secured Party

  

Type of Collateral

  

UCC-1 File

Date

  

UCC-1 File

Number

                                                                                
                                                  

 

K-2-13

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

Schedule 10

(a) Equity Interests of Companies and Subsidiaries

 

Current Legal

Entities Owned

  

Record Owner

  

Certificate No.

  

No. Shares/Interest

  

Percent Pledged

                                                                                
                          

(b) Other Equity Interests

 

K-2-14

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

Schedule 11

Instruments and Tangible Chattel Paper

 

1. Promissory Notes:

 

Entity

  

Principal Amount

  

Date of Issuance

  

Interest Rate

  

Maturity Date

                                                                                

 

2. Chattel Paper:

 

K-2-15

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

Schedule 12(a)

Patents and Trademarks

UNITED STATES PATENTS:

Registrations:

 

OWNER

  

REGISTRATION

NUMBER

  

DESCRIPTION

                                               

Applications:

 

OWNER

  

APPLICATION

NUMBER

  

DESCRIPTION

                                               

Licenses:

 

LICENSEE

  

LICENSOR

  

REGISTRATION/

APPLICATION

NUMBER

  

DESCRIPTION

                                         

OTHER PATENTS:

Registrations:

 

OWNER

  

REGISTRATION

NUMBER

  

COUNTRY/STATE

  

DESCRIPTION

                                         

Applications:

 

OWNER

  

APPLICATION

NUMBER

  

COUNTRY/STATE

  

DESCRIPTION

                                         

 

K-2-16

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

Licenses:

 

LICENSEE

  

LICENSOR

  

COUNTRY/STATE

  

REGISTRATION/
APPLICATION

NUMBER

  

DESCRIPTION

                                                     

UNITED STATES TRADEMARKS:

Registrations:

 

OWNER

  

REGISTRATION NUMBER

  

TRADEMARK

                                                                 

Applications:

 

OWNER

  

APPLICATION NUMBER

  

TRADEMARK

                                                                 

Licenses:

 

LICENSEE

  

LICENSOR

  

REGISTRATION/
APPLICATION

NUMBER

  

TRADEMARK

                                                           

OTHER TRADEMARKS:

Registrations:

 

OWNER

 

REGISTRATION

NUMBER

 

COUNTRY/STATE

 

TRADEMARK

                                                  

Applications:

 

OWNER

  

APPLICATION

NUMBER

  

COUNTRY/STATE

  

TRADEMARK

                                                           

 

K-2-17

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

Licenses:

 

LICENSEE

  

LICENSOR

  

COUNTRY/STATE

  

REGISTRATION/
APPLICATION

NUMBER

  

TRADEMARK

                                                     

 

K-2-18

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

Schedule 12(b)

Copyrights

UNITED STATES COPYRIGHTS

Registrations:

 

OWNER

  

TITLE

  

REGISTRATION NUMBER

                                               

Applications:

 

OWNER

  

APPLICATION NUMBER

                                                     

Licenses:

 

LICENSEE

  

LICENSOR

  

REGISTRATION/

APPLICATION

NUMBER

  

DESCRIPTION

                                         

OTHER COPYRIGHTS

Registrations:

 

OWNER

  

COUNTRY/STATE

  

TITLE

  

REGISTRATION NUMBER

                                         

Applications:

 

OWNER

  

COUNTRY/STATE

  

APPLICATION NUMBER

                                               

Licenses:

 

LICENSEE

  

LICENSOR

  

COUNTRY/STATE

  

REGISTRATION/
APPLICATION

NUMBER

  

DESCRIPTION

                                                     

 

K-2-19

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

Schedule 12(c)

Intellectual Property Filings

 

K-2-20

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

Schedule 13

Commercial Tort Claims

 

K-2-21

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

Schedule 14

Deposit Accounts, Securities Accounts and Commodity Accounts

 

OWNER

  

TYPE OF ACCOUNT

  

BANK OR

INTERMEDIARY

  

ACCOUNT NUMBERS

                                         

 

K-2-22

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

Schedule 15

Letter of Credit Rights

 

K-2-23

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

Schedule 16

Motor Vehicles

 

K-2-24

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

EXHIBIT L

[Form of]

JOINDER AGREEMENT

Reference is made to the Credit Agreement, dated as of October 20, 2010 (the
“Credit Agreement”) among DaVita Inc., a Delaware corporation (“Borrower”), the
Guarantors (such term and each other capitalized term used but not defined
herein having the meaning given to it in Section 1 of the Credit Agreement), the
Lenders, JPMorgan Chase Bank, N.A., as Administrative Agent and Collateral
Agent, and the other agents party thereto.

W I T N E S S E T H:

WHEREAS, the Guarantors have entered into the Credit Agreement and the Security
Agreement in order to induce the Lenders to make the Loans and the Issuing
Lender to issue Letters of Credit to or for the benefit of Borrower;

WHEREAS, pursuant to Section 6.12(b) of the Credit Agreement, Subsidiaries of
Borrower are generally required to become Guarantors under the Credit Agreement.
The undersigned Subsidiary (the “New Guarantor”) is executing this joinder
agreement (“Joinder Agreement”) to the Credit Agreement in order to induce the
Lenders to make additional Revolving Loans and the Issuing Lender to issue
Letters of Credit and as consideration for the Loans previously made [and
Letters of Credit previously issued].

NOW, THEREFORE, the Administrative Agent, Collateral Agent and the New Guarantor
hereby agree as follows:

1. Guarantee. In accordance with Section 6.12(b) of the Credit Agreement, the
New Guarantor by its signature below becomes a Guarantor under the Credit
Agreement with the same force and effect as if originally named therein as a
Guarantor.

2. Representations and Warranties. The New Guarantor hereby (a) agrees to all
the terms and provisions of the Credit Agreement applicable to it as a Guarantor
thereunder and (b) represents and warrants that the representations and
warranties made by it as a Guarantor thereunder are true and correct in all
material respects (except that any representation and warranty that is qualified
as to “materiality” or “Material Adverse Effect” shall be true and correct in
all respects) on and as of the date hereof. Each reference to a Guarantor in the
Credit Agreement shall be deemed to include the New Guarantor. The New Guarantor
hereby attaches supplements to each of the schedules to the Credit Agreement
applicable to it.

3. Severability. Any provision of this Joinder Agreement which is prohibited or
unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective
to the extent of such prohibition or unenforceability without invalidating the
remaining provisions hereof, and any such prohibition or unenforceability in any
jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction.

4. Counterparts. This Joinder Agreement may be executed in counterparts, each of
which shall constitute an original. Delivery of an executed signature page to
this Joinder Agreement by facsimile transmission shall be as effective as
delivery of a manually executed counterpart of this Joinder Agreement.

 

L-1

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

5. No Waiver. Except as expressly supplemented hereby, the Credit Agreement
shall remain in full force and effect.

6. Notices. All notices, requests and demands to or upon the New Guarantor, any
Agent or any Lender shall be governed by the terms of Section 11.2 of the Credit
Agreement.

7. Governing Law. THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES
HEREUNDER SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAW OF THE
STATE OF NEW YORK (INCLUDING, WITHOUT LIMITATION, SECTIONS 5-1401 AND 5-1402 OF
THE NEW YORK GENERAL OBLIGATIONS LAW, BUT OTHERWISE WITHOUT REGARD TO CONFLICTS
OF LAWS PRINCIPLES THEREOF.

[Signature Page Follows]

 

L-2

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

IN WITNESS WHEREOF, the undersigned have caused this Joinder Agreement to be
duly executed and delivered by their duly authorized officers as of the day and
year first above written.

 

[NEW GUARANTOR] By:  

 

  Name:   Title: Address for Notices: JPMORGAN CHASE BANK, N.A., as
Administrative Agent and Collateral Agent By:  

 

  Name:   Title:

 

L-3

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

[Note: Schedules to be attached.]

 

L-4

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

EXHIBIT M

[Form of]

INTERCOMPANY NOTE

New York, New York

[date]

FOR VALUE RECEIVED, each of the undersigned, to the extent a borrower from time
to time from any other entity listed on the signature page hereto (each, in such
capacity, a “Payor”), hereby promises to pay on demand to the order of such
other entity listed below (each, in such capacity, a “Payee”), in lawful money
of the United States of America in immediately available funds, at such location
in the United States of America as a Payee shall from time to time designate,
the unpaid principal amount of all loans and advances (including trade payables)
made by such Payee to such Payor. Each Payor promises also to pay interest on
the unpaid principal amount of all such loans and advances in like money at said
location from the date of such loans and advances until paid at such rate per
annum as shall be agreed upon from time to time by such Payor and such Payee.

This note (“Note”) is the Intercompany Note referred to in the Credit Agreement
dated as of October 20, 2010 (as amended, amended and restated, supplemented or
otherwise modified from time to time, the “Credit Agreement”) among DaVita Inc.,
a Delaware corporation, the Guarantors (such term and each other capitalized
term used but not defined herein having the meaning given it in Section 1 of the
Credit Agreement), the Lenders, JPMorgan Chase Bank, N.A., as Administrative
Agent and Collateral Agent, and the other agents party thereto, and is subject
to the terms thereof, and shall be pledged by each Payee pursuant to the
Security Agreement, to the extent required pursuant to the terms thereof. Each
Payee hereby acknowledges and agrees that the Administrative Agent may exercise
all rights provided in the Credit Agreement and the Security Agreement with
respect to this Note.

Anything in this Note to the contrary notwithstanding, the indebtedness
evidenced by this Note owed by any Payor that is Borrower or a Guarantor to any
Payee other than Borrower shall be subordinate and junior in right of payment,
to the extent and in the manner hereinafter set forth, to all Obligations of
such Payor under the Credit Agreement, including, without limitation, where
applicable, under such Payor’s guarantee of the Obligations under the Credit
Agreement (such Obligations and other indebtedness and obligations in connection
with any renewal, refunding, restructuring or refinancing thereof, including
interest thereon accruing after the commencement of any proceedings referred to
in clause (i) below, whether or not such interest is an allowed claim in such
proceeding, being hereinafter collectively referred to as “Senior
Indebtedness”):

(A) In the event of any insolvency or bankruptcy proceedings, and any
receivership, liquidation, reorganization or other similar proceedings in
connection therewith, relative to any Payor or to its creditors, as such, or to
its property, and in the event of any proceedings for voluntary liquidation,
dissolution or other winding up of such Payor, whether or not involving
insolvency or bankruptcy, then (x) the holders of Senior Indebtedness shall be
paid in full in cash in respect of all amounts constituting Senior Indebtedness
before any Payee is entitled to receive (whether directly or indirectly), or
make any demands for, any payment on account of this Note and (y) until the
holders of Senior Indebtedness are paid in full in cash in respect of all
amounts constituting Senior Indebtedness, any payment or distribution to which
such Payee would otherwise be entitled (other than debt securities of such Payor
that are subordinated, to at least the

 

M-1

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

same extent as this Note, to the payment of all Senior Indebtedness then
outstanding (such securities being hereinafter referred to as “Restructured Debt
Securities”)) shall be made to the holders of Senior Indebtedness;

(B) if any Event of Default occurs and is continuing with respect to any Senior
Indebtedness (including any Default under the Credit Agreement), then no payment
or distribution of any kind or character shall be made by or on behalf of the
Payor or any other Person on its behalf with respect to this Note; and

(C) if any payment or distribution of any character, whether in cash, securities
or other property (other than Restructured Debt Securities), in respect of this
Note shall (despite these subordination provisions) be received by any Payee in
violation of clause (i) or (ii) before all Senior Indebtedness shall have been
paid in full in cash, such payment or distribution shall be held in trust for
the benefit of, and shall be paid over or delivered to, the holders of Senior
Indebtedness (or their representatives), ratably according to the respective
aggregate amounts remaining unpaid thereon, to the extent necessary to pay all
Senior Indebtedness in full in cash.

To the fullest extent permitted by law, no present or future holder of Senior
Indebtedness shall be prejudiced in its right to enforce the subordination of
this Note by any act or failure to act on the part of any Payor or by any act or
failure to act on the part of such holder or any trustee or agent for such
holder. Each Payee and each Payor hereby agree that the subordination of this
Note is for the benefit of the Administrative Agent, the Issuing Lender and the
Lenders and the Administrative Agent, the Issuing Lender and the Lenders are
obligees under this Note to the same extent as if their names were written
herein as such and the Administrative Agent may, on behalf of the itself, the
Issuing Lender and the Lenders, proceed to enforce the subordination provisions
herein.

The indebtedness evidenced by this Note owed by any Payor that is not Borrower
or a Guarantor shall not be subordinated to, and shall rank pari passu in right
of payment with, any other obligation of such Payor.

Nothing contained in the subordination provisions set forth above is intended to
or will impair, as between each Payor and each Payee, the obligations of such
Payor, which are absolute and unconditional, to pay to such Payee the principal
of and interest on this Note as and when due and payable in accordance with its
terms, or is intended to or will affect the relative rights of such Payee and
other creditors of such Payor other than the holders of Senior Indebtedness.

Each Payee is hereby authorized to record all loans and advances made by it to
any Payor (all of which shall be evidenced by this Note), and all repayments or
prepayments thereof, in its books and records, such books and records
constituting prima facie evidence of the accuracy of the information contained
therein.

Each Payor hereby waives presentment, demand, protest or notice of any kind in
connection with this Note. All payments under this Note shall be made without
offset, counterclaim or deduction of any kind.

 

M-2

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

THIS NOTE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF
THE STATE OF NEW YORK (INCLUDING, WITHOUT LIMITATION, SECTIONS 5-1401 AND 5-1402
OF THE NEW YORK GENERAL OBLIGATIONS LAW, BUT OTHERWISE WITHOUT REGARD TO
CONFLICTS OF LAWS PRINCIPLES THEREOF).

 

[List Borrower and All Subsidiaries] By:  

 

  Name:   Title:

 

M-3

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

EXHIBIT N-1

[Form of]

REVOLVING LOAN NOTE

 

$                 

  New York, New York   [Date]

FOR VALUE RECEIVED, the undersigned, DaVita Inc., a Delaware corporation
(“Borrower”), hereby promises to pay to the order of [                        ]
(the “Lender”) on the Revolving Termination Date, in lawful money of the United
States or such other Alternative Currency in which a relevant Revolving Loan was
made and in immediately available funds the aggregate unpaid principal amount of
all Revolving Loans of the Lender outstanding under the Credit Agreement
referred to below. Borrower further agrees to pay interest in like money at such
office specified in Section 2.17(d) of the Credit Agreement on the unpaid
principal amount hereof from time to time from the date hereof at the rates, and
on the dates, specified in Section 2.14 of such Credit Agreement.

The holder of this Note may endorse and attach a schedule to reflect the date,
Type, currency and amount of each Revolving Loan of the Lender outstanding under
the Credit Agreement, the date and amount of each payment or prepayment of
principal hereof, and the date of each interest rate conversion or continuation
pursuant to Section 2.12 of the Credit Agreement and the principal amount
subject thereto; provided that the failure of the Lender to make any such
recordation (or any error in such recordation) shall not affect the obligations
of Borrower hereunder or under the Credit Agreement.

This Note is one of the Notes referred to in the Credit Agreement dated as of
October 20, 2010 (as amended, amended and restated, supplemented or otherwise
modified from time to time, the “Credit Agreement”), among Borrower, the
Guarantors, the Lenders, JPMorgan Chase Bank, N.A., as Administrative Agent and
Collateral Agent, and the other agents party thereto, is subject to the
provisions thereof and is subject to optional and mandatory prepayment in whole
or in part as provided therein. Terms used herein which are defined in the
Credit Agreement shall have such defined meanings unless otherwise defined
herein or unless the context otherwise requires.

This Note is secured and guaranteed as provided in the Credit Agreement and the
Security Documents. Reference is hereby made to the Credit Agreement and the
Security Documents for a description of the properties and assets in which a
security interest has been granted, the nature and extent of the security and
guarantees, the terms and conditions upon which the security interest and each
guarantee was granted and the rights of the holder of this Note in respect
thereof.

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 Note shall become,
or may be declared to be, immediately due and payable, all as provided therein.

All parties now and hereafter liable with respect to this Note, whether maker,
principal, surety, guarantor, endorser or otherwise, hereby waive presentment,
demand, protest and all other notices of any kind.

THIS NOTE MAY NOT BE TRANSFERRED EXCEPT IN COMPLIANCE WITH THE TERMS OF THE
CREDIT AGREEMENT. TRANSFERS OF THIS NOTE MUST BE RECORDED IN THE REGISTER
MAINTAINED BY THE ADMINISTRATIVE AGENT PURSUANT TO THE TERMS OF THE CREDIT
AGREEMENT.

 

N-1-1

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

THIS NOTE SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE
STATE OF NEW YORK (INCLUDING, WITHOUT LIMITATION, SECTIONS 5-1401 AND 5-1402 OF
THE NEW YORK GENERAL OBLIGATIONS LAW, BUT OTHERWISE WITHOUT REGARD TO CONFLICTS
OF LAWS PRINCIPLES THEREOF).

[Signature Page Follows]

 

N-1-2

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

DAVITA INC.,

as Borrower

By:  

 

  Name:   Title:

 

N-1-3

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

EXHIBIT N-2

[Form of]

TRANCHE A TERM LOAN NOTE

 

$                     

  New York, New York   [Date]

FOR VALUE RECEIVED, the undersigned, DaVita Inc., a Delaware corporation
(“Borrower”), hereby promises to pay to the order of [                ] (the
“Lender”) on [maturity date] in lawful money of the United States and in
immediately available funds, the principal amount of                  DOLLARS
($                ), or, if less, the aggregate unpaid principal amount of all
Tranche A Term Loans of the Lender outstanding under the Credit Agreement
referred to below, which sum shall be due and payable in such amounts and on
such dates as are set forth in the Credit Agreement. Borrower further agrees to
pay interest in like money at such office specified in Section 2.17(d) of the
Credit Agreement on the unpaid principal amount hereof from time to time from
the date hereof at the rates, and on the dates, specified in Section 2.14 of
such Credit Agreement.

The holder of this Note may endorse and attach a schedule to reflect the date,
Type and amount of each Tranche A Term Loan of the Lender outstanding under the
Credit Agreement, the date and amount of each payment or prepayment of principal
hereof, and the date of each interest rate conversion or continuation pursuant
to Section 2.12 of the Credit Agreement and the principal amount subject
thereto; provided that the failure of the Lender to make any such recordation
(or any error in such recordation) shall not affect the obligations of Borrower
hereunder or under the Credit Agreement.

This Note is one of the Notes referred to in the Credit Agreement dated as of
October 20, 2010 (as amended, amended and restated, supplemented or otherwise
modified from time to time, the “Credit Agreement”), among Borrower, the
Guarantors, the Lenders, JPMorgan Chase Bank, N.A., as Administrative Agent and
Collateral Agent, and the other agents party thereto, is subject to the
provisions thereof and is subject to optional and mandatory prepayment in whole
or in part as provided therein. Terms used herein which are defined in the
Credit Agreement shall have such defined meanings unless otherwise defined
herein or unless the context otherwise requires.

This Note is secured and guaranteed as provided in the Credit Agreement and the
Security Documents. Reference is hereby made to the Credit Agreement and the
Security Documents for a description of the properties and assets in which a
security interest has been granted, the nature and extent of the security and
guarantees, the terms and conditions upon which the security interest and each
guarantee was granted and the rights of the holder of this Note in respect
thereof.

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 Note shall become,
or may be declared to be, immediately due and payable all as provided therein.

All parties now and hereafter liable with respect to this Note, whether maker,
principal, surety, guarantor, endorser or otherwise, hereby waive presentment,
demand, protest and all other notices of any kind.

 

N-2-1

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

THIS NOTE MAY NOT BE TRANSFERRED EXCEPT IN COMPLIANCE WITH THE TERMS OF THE
CREDIT AGREEMENT. TRANSFERS OF THIS NOTE MUST BE RECORDED IN THE REGISTER
MAINTAINED BY THE ADMINISTRATIVE AGENT PURSUANT TO THE TERMS OF THE CREDIT
AGREEMENT.

THIS NOTE SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE
STATE OF NEW YORK (INCLUDING, WITHOUT LIMITATION, SECTIONS 5-1401 AND 5-1402 OF
THE NEW YORK GENERAL OBLIGATIONS LAW, BUT OTHERWISE WITHOUT REGARD TO CONFLICTS
OF LAWS PRINCIPLES THEREOF).

[Signature Page Follows]

 

N-2-2

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

DAVITA INC.,

as Borrower

By:  

 

  Name:   Title:

 

N-2-3

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

EXHIBIT N-3

[Form of]

TRANCHE B TERM LOAN NOTE

 

$                            New York, New York    [Date]

FOR VALUE RECEIVED, the undersigned, DaVita Inc., a Delaware corporation
(“Borrower”), hereby promises to pay to the order of [                        ]
(the “Lender”) on the Tranche B Term Loan Maturity Date, in lawful money of the
United States and in immediately available funds, the principal amount of
                 DOLLARS ($                ), or if less, the aggregate unpaid
principal amount of all Tranche B Term Loans of the Lender outstanding under the
Credit Agreement referred to below, which sum shall be due and payable in such
amounts and on such dates as are set forth in the Credit Agreement. Borrower
further agrees to pay interest in like money at such office specified in
Section 2.17(d) of the Credit Agreement on the unpaid principal amount hereof
from time to time from the date hereof at the rates, and on the dates, specified
in Section 2.14 of such Credit Agreement.

The holder of this Note may endorse and attach a schedule to reflect the date,
Type and amount of each Tranche B Term Loan of the Lender outstanding under the
Credit Agreement, the date and amount of each payment or prepayment of principal
hereof, and the date of each interest rate conversion or continuation pursuant
to Section 2.12 of the Credit Agreement and the principal amount subject
thereto; provided that the failure of the Lender to make any such recordation
(or any error in such recordation) shall not affect the obligations of Borrower
hereunder or under the Credit Agreement.

This Note is one of the Notes referred to in the Credit Agreement, dated as of
October 20, 2010 (as amended, amended and restated, supplemented or otherwise
modified from time to time, the “Credit Agreement”), among Borrower, the
Guarantors, the Lenders, JPMorgan Chase Bank, N.A., as Administrative Agent and
Collateral Agent, and the other agents party thereto, is subject to the
provisions thereof and is subject to optional and mandatory prepayment in whole
or in part as provided therein. Terms used herein which are defined in the
Credit Agreement shall have such defined meanings unless otherwise defined
herein or unless the context otherwise requires.

This Note is secured and guaranteed as provided in the Credit Agreement and the
Security Documents. Reference is hereby made to the Credit Agreement and the
Security Documents for a description of the properties and assets in which a
security interest has been granted, the nature and extent of the security and
guarantees, the terms and conditions upon which the security interest and each
guarantee was granted and the rights of the holder of this Note in respect
thereof.

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 Note shall become,
or may be declared to be, immediately due and payable as provided therein.

All parties now and hereafter liable with respect to this Note, whether maker,
principal, surety, guarantor, endorser or otherwise, hereby waive presentment,
demand, protest and all other notices of any kind.

 

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THIS NOTE MAY NOT BE TRANSFERRED EXCEPT IN COMPLIANCE WITH THE TERMS OF THE
CREDIT AGREEMENT. TRANSFERS OF THIS NOTE MUST BE RECORDED IN THE REGISTER
MAINTAINED BY THE ADMINISTRATIVE AGENT PURSUANT TO THE TERMS OF THE CREDIT
AGREEMENT.

THIS NOTE SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE
STATE OF NEW YORK (INCLUDING, WITHOUT LIMITATION, SECTIONS 5-1401 AND 5-1402 OF
THE NEW YORK GENERAL OBLIGATIONS LAW, BUT OTHERWISE WITHOUT REGARD TO CONFLICTS
OF LAWS PRINCIPLES THEREOF).

[Signature Page Follows]

 

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DAVITA INC., as Borrower By:  

 

  Name:   Title:

 

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EXHIBIT N-4

[Form of]

SWINGLINE NOTE

 

$                            New York, New York    [Date]

FOR VALUE RECEIVED, the undersigned, DaVita Inc., a Delaware corporation
(“Borrower”), hereby promises to pay to the order of [                        ]
(the “Lender”) on the Revolving Termination Date, in lawful money of the United
States and in immediately available funds, the principal amount of the lesser of
(a)                  ($                ) and (b) the aggregate unpaid principal
amount of all Swingline Loans made by Lender to the undersigned pursuant to
Sections 2.6 and 2.7 of the Credit Agreement referred to below. Borrower further
agrees to pay interest on the unpaid principal amount hereof in like money at
such office specified in Section 2.17(d) of the Credit Agreement from time to
time from the date hereof at the rates and on the dates specified in
Section 2.14 of the Credit Agreement.

The holder of this Note may endorse and attach a schedule to reflect the date,
the amount of each Swingline Loan and the date and amount of each payment or
prepayment of principal thereof; provided that the failure of Lender to make
such recordation (or any error in such recordation) shall not affect the
obligations of Borrower hereunder or under the Credit Agreement.

This Note is one of the Notes referred to in the Credit Agreement, dated as of
October 20, 2010 (as amended, amended and restated, supplemented or otherwise
modified from time to time, the “Credit Agreement”), among Borrower, the
Guarantors, the Lenders, JPMorgan Chase Bank, N.A., as Administrative Agent and
Collateral Agent, and the other agents party thereto, is subject to the
provisions thereof and is subject to optional and mandatory prepayment in whole
or in part as provided therein. Terms used herein which are defined in the
Credit Agreement shall have such defined meanings unless otherwise defined
herein or unless the context otherwise requires.

This Note is secured and guaranteed as provided in the Credit Agreement and the
Security Documents. Reference is hereby made to the Credit Agreement and the
Security Documents for a description of the properties and assets in which a
security interest has been granted, the nature and extent of the security and
guarantees, the terms and conditions upon which the security interest and each
guarantee was granted and the rights of the holder of this Note in respect
thereof.

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 Note may become, or
may be declared to be, immediately due and payable as provided in the Credit
Agreement.

All parties now and hereafter liable with respect to this Note, whether maker,
principal, surety, guarantor, endorser or otherwise, hereby waive presentment,
demand, protest and all other notices of any kind.

THIS NOTE MAY NOT BE TRANSFERRED EXCEPT IN COMPLIANCE WITH THE TERMS OF THE
CREDIT AGREEMENT. TRANSFERS OF THIS NOTE MUST BE RECORDED IN THE REGISTER
MAINTAINED BY THE ADMINISTRATIVE AGENT PURSUANT TO THE TERMS OF THE CREDIT
AGREEMENT.

 

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THIS NOTE SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE
STATE OF NEW YORK (INCLUDING, WITHOUT LIMITATION, SECTIONS 5-1401 AND 5-1402 OF
THE NEW YORK GENERAL OBLIGATIONS LAW, BUT OTHERWISE WITHOUT REGARD TO CONFLICTS
OF LAWS PRINCIPLES THEREOF).

[Signature Page Follows]

 

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DAVITA INC., as Borrower By:  

 

  Name:   Title:

 

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EXHIBIT O

[Form of]

LC REQUEST

Dated [                ]

JPMorgan Chase Bank, N.A., as Administrative Agent under the Credit Agreement
(as amended, modified or supplemented from time to time, the “Credit
Agreement”), dated as of October 20, 2010, among DaVita Inc., a Delaware
corporation, the Lenders from time to time party thereto, JPMorgan Chase Bank,
N.A., as Administrative Agent and Collateral Agent, and the other agents party
thereto.

JPMorgan Chase Bank, N.A.,

    as Administrative Agent for

the Lenders referred to below,

c/o JPMorgan Chase Bank, Loan and Agency Services Group

1111 Fannin, 10th Floor

Houston, Texas 77002

Attention: Maria Saez

Fax: 713-374-4312

with a copy to:

JPMorgan Chase Bank, N.A.

270 Park Avenue

New York, NY 10017

Attention: Dawn Lee Lum

Fax: 212-270-3279

Ladies and Gentlemen:

We hereby request that [name of proposed Issuing Lender], as Issuing Lender
under the Credit Agreement, [issue] [amend] [renew] [extend] [a] [an existing]
Letter of Credit for the account of the undersigned on [        ] (the “Date of
[Issuance] [Amendment] [Renewal] [Extension]”) in the aggregate stated amount of
[        ]25. [Such Letter of Credit was originally issued on [date].] The
requested Letter of Credit [shall be] [is] denominated in Dollars.

For purposes of this LC Request, unless otherwise defined herein, all
capitalized terms used herein which are defined in the Credit Agreement shall
have the respective meaning provided therein.

 

25  Aggregate initial stated amount of Letter of Credit.

 

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The beneficiary of the requested Letter of Credit [will be] [is] [        ], and
such Letter of Credit [will be] [is] in support of (26) and [will have] [has] a
stated expiration date of [        ]27. [Describe the nature of the amendment,
renewal or extension.]

We hereby certify that:

(1) Each of Borrower and each other Loan Party is in compliance in all material
respects with all the terms and provisions set forth in each Loan Document on
its part to be observed or performed, and, as of today and at the time of and
immediately after giving effect to the [issuance] [amendment] [renewal]
[extension] of the Letter of Credit requested herein, no Default has or will
have occurred and be continuing.

(2) Each of the representations and warranties made by any Loan Party set forth
in any Loan Document are true and correct in all material respects (except that
any representation and warranty that is qualified as to “materiality” or
“Material Adverse Effect” is true and correct in all respects) on and as of
today’s date and with the same effect as though made on and as of today’s date,
except to the extent such representations and warranties expressly relate to an
earlier date.

(3) No order, judgment or decree of any Governmental Authority purports to
restrain any Lender from taking any actions to be made hereunder or from making
any Loans to be made by it. No injunction or other restraining order has been
issued, is pending or noticed with respect to any action, suit or proceeding
seeking to enjoin or otherwise prevent the consummation of, or to recover any
damages or obtain relief as a result of, the transactions contemplated by this
LC Request, the Credit Agreement or the making of Loans thereunder.

(4) After giving effect to the request herein, the LC Obligations will not
exceed the LC Commitment and the Available Revolving Commitments will not be
less than zero.

 

26  Insert description of the obligation to which it relates in the case of
standby Letters of Credit and a description of the commercial transaction which
is being supported in the case of commercial Letters of Credit.

27  Each Letter of Credit shall expire no later than the earlier of (x) the
first anniversary of its date of issuance and (y) the date that is fifteen
Business Days prior to the Revolving Termination Date (or with respect to any
Letters of Credit outstanding with respect to an Extended Revolving Commitment,
the Maturity Date applicable thereto), provided that any Letter of Credit with a
one-year term may provide for the renewal thereof for additional one-year
periods (which shall in no event extend beyond the date referred to in clause
(y) above).

 

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Copies of all relevant documentation with respect to the supported transaction
are attached hereto.

 

DAVITA INC. By:  

 

  Name:   Title:

 

O-3

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EXHIBIT P

[Form of]

INTEREST ELECTION REQUEST

JPMorgan Chase Bank, N.A.,

    as Administrative Agent for

the Lenders referred to below,

c/o JPMorgan Chase Bank, Loan and Agency Services Group

1111 Fannin, 10th Floor

Houston, Texas 77002

Attention: Maria Saez

Fax: 713-374-4312

with a copy to:

JPMorgan Chase Bank, N.A.

270 Park Avenue

New York, NY 10017

Attention: Dawn Lee Lum

Fax: 212-270-3279

[Date]

Re: DaVita Inc.

Ladies and Gentlemen:

This Interest Election Request is delivered to you pursuant to Section 2.12 of
the Credit Agreement dated as of October 20, 2010 (as amended, amended and
restated, supplemented or otherwise modified from time to time, the “Credit
Agreement”) among DaVita Inc., a Delaware corporation (“Borrower”), the
Subsidiary Guarantors (such term and each other capitalized term used but not
defined herein having the meaning given it in Section 1 thereof), the Lenders,
JPMorgan Chase Bank, N.A., as Administrative Agent and Collateral Agent, and the
other agents party thereto.

Borrower hereby requests that on [                ]28 (the “Interest Election
Date”),

1. $[                ] of the presently outstanding principal amount of the
Loans originally made on [                ],

 

28  Shall be a Business Day that is (a) the next Business Day following the date
hereof in the case of a conversion into ABR Loans to the extent this Interest
Election Request is delivered to the Administrative Agent prior to 2:00 p.m.,
New York City time on the date hereof, otherwise the second Business Day
following the date of delivery hereof, (b) three Business Days following the
date hereof in the case of a conversion into Eurodollar Loans denominated in
Dollars to the extent this Interest Election Request is delivered to the
Administrative Agent prior to 2:00 p.m. New York City time on the date hereof,
otherwise the fourth Business Day following the date of delivery hereof. Notices
of continuation of any Eurodollar Loan shall be delivered to the Administrative
Agent not later than 11:00 A.M. Local Time, three Business Days prior to the
last day of the then current Interest Period with respect thereto.

 

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2. and all presently being maintained as [ABR Loans] [Eurodollar Loans],

3. be [converted into] [continued as],

4. [Eurodollar Loans having an Interest Period of
[one/two/three/six/nine/twelve] months] [ABR Loans].

The undersigned hereby certifies that the following statements are true on the
date hereof, and will be true on the proposed Interest Election Date, both
before and after giving effect thereto and to the application of the proceeds
therefrom:

(a) the foregoing [conversion] [continuation] complies with the terms and
conditions of the Credit Agreement (including, without limitation, Section 2.12
of the Credit Agreement);

(b) no Default has occurred and is continuing, or would result from such
proposed [conversion] [continuation].

[Signature Page Follows]

 

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Borrower has caused this Interest Election Request to be executed and delivered
by its duly authorized officer as of the date first written above.

 

DAVITA INC. By:  

 

  Name:   Title:

 

P-3