Exhibit 10.2

 

Execution Version

 

LOAN AGREEMENT

 

Dated as of February 6, 2020

 

among

 

COLLEGIUM PHARMACEUTICAL, INC.

 

(as Borrower),

 

THE GUARANTORS PARTY HERETO

 

(as additional Credit Parties),

 

BIOPHARMA CREDIT PLC

 

(as Collateral Agent and a Lender),

 

and

 

BIOPHARMA CREDIT INVESTMENTS V (MASTER) LP

 

(as a Lender)

 

 

 

 

TABLE OF CONTENTS

 

  Page     1.     ACCOUNTING AND OTHER TERMS 1 2.     LOANS AND TERMS OF PAYMENT
1 2.1.       Promise to Pay 1 2.2.       Term Loans 1 2.3.       Payment of
Interest on the Credit Extensions 3 2.4.       Expenses 4
2.5.       Requirements of Law; Increased Costs 4 2.6.       Taxes; Withholding,
Etc. 5 2.7.       Additional Consideration 7 2.8.       Evidence of Debt;
Register; Collateral Agent’s Books and Records; Term Loan Notes 8
3.     CONDITIONS TO EFFECTIVENESS AND TERM LOANS 8 3.1.       Conditions
Precedent to Effectiveness 8 3.2.       Conditions Precedent to Term Loans 9
3.3.       Covenant to Deliver 11 3.4.       Procedures for Borrowing 11
4.     REPRESENTATIONS AND WARRANTIES 11 4.1.       Due Organization, Existence,
Power and Authority 11 4.2.       Equity Interests 12 4.3.       Authorization;
No Conflict 12 4.4.       Government Consents; Third Party Consents 12
4.5.       Binding Obligation 12 4.6.       Collateral 12 4.7.       Adverse
Proceedings; Specified Disputes; Compliance with Laws 17 4.8.       Exchange Act
Documents; Financial Statements; Financial Condition; No Material Adverse
Change; Books and Records 17 4.9.       Solvency 18 4.10.     Payment of Taxes
18 4.11.     Environmental Matters 18 4.12.     Material Contracts 19
4.13.     Regulatory Compliance 19 4.14.     Margin Stock 19
4.15.     Subsidiaries 19 4.16.     Employee Matters 19 4.17.     Full
Disclosure 20 4.18.     FCPA; Patriot Act; OFAC; Export and Import Laws 20
4.19.     Health Care Matters 21 4.20.     Regulatory Approvals 23
4.21.     Supply and Manufacturing 24 4.22.     Cybersecurity; Data Protection
24 4.23.     Additional Representations and Warranties 25 5.     AFFIRMATIVE
COVENANTS 25 5.1.       Maintenance of Existence 25 5.2.       Financial
Statements, Notices 25 5.3.       Taxes 27 5.4.       Insurance 27
5.5.       Operating Accounts 28 5.6.       Compliance with Laws 28

 

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5.7.       Protection of Intellectual Property Rights 28 5.8.       Books and
Records 29 5.9.       Access to Collateral; Audits 29 5.10.     Use of Proceeds
30 5.11.     Further Assurances 30 5.12.     Additional Collateral; Guarantors
30 5.13.     Formation or Acquisition of Subsidiaries 31 5.14.     Post-Closing
Requirements 31 5.15.     Environmental 32 5.16.     Inventory; Returns;
Maintenance of Properties 32 6.     NEGATIVE COVENANTS 33
6.1.       Dispositions 33 6.2.       Fundamental Changes; Location of
Collateral 33 6.3.       Mergers, Liquidations or Dissolutions 33
6.4.       Indebtedness 34 6.5.       Encumbrances 34 6.6.       No Further
Negative Pledges; Negative Pledge 34 6.7.       Maintenance of Collateral
Accounts 34 6.8.       Distributions; Investments 34 6.9.       No Restrictions
on Subsidiary Distributions 35 6.10.     Subordinated Debt 35
6.11.     Amendments or Waivers of Organizational Documents 35
6.12.     Compliance 35 6.13.     Compliance with Sanctions and Anti-Money
Laundering Laws 35 6.14.     Amendments or Waivers of Current Company IP
Agreements and Current Acquisition IP Agreements 36 6.15.     Minimum Revenue 36
7.     EVENTS OF DEFAULT 36 7.1.       Payment Default 36 7.2.       Covenant
Default 36 7.3.       Material Adverse Change 36 7.4.       Attachment; Levy;
Restraint on Business 36 7.5.       Insolvency 37 7.6.       Other Agreements 37
7.7.       Judgments 37 7.8.       Misrepresentations 37 7.9.       Loan
Documents; Collateral 37 7.10.     ERISA Event 37 8.     RIGHTS AND REMEDIES
UPON AN EVENT OF DEFAULT 38 8.1.       Rights and Remedies 38 8.2.       Power
of Attorney 39 8.3.       Application of Payments and Proceeds Upon Default 39
8.4.       Collateral Agent’s Liability for Collateral 39 8.5.       No Waiver;
Remedies Cumulative 40 8.6.       Demand Waiver; Makewhole Amount; Prepayment
Premium 40 9.       NOTICES 40 10.     CHOICE OF LAW, VENUE, AND JURY TRIAL
WAIVER 42 11.     GENERAL PROVISIONS 42 11.1.     Successors and Assigns 42
11.2.     Indemnification 43 11.3.     Severability of Provisions 44
11.4.     Correction of Loan Documents 44

 

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11.5.     Amendments in Writing; Integration 44 11.6.     Counterparts 44
11.7.     Survival 44 11.8.     Confidentiality 44 11.9.     Attorneys’ Fees,
Costs and Expenses 45 11.10.   Right of Set-Off 45 11.11.   Marshalling;
Payments Set Aside 45 11.12.   Electronic Execution of Documents 45
11.13.   Captions 45 11.14.   Construction of Agreement 46 11.15.   Third
Parties 46 11.16.   No Advisory or Fiduciary Duty 46 12.   COLLATERAL AGENT 46
12.1.   Appointment and Authority 46 12.2.   Rights as a Lender 46
12.3.   Exculpatory Provisions 47 12.4.   Reliance by Collateral Agent 47
12.5.   Delegation of Duties 47 12.6.   Resignation of Collateral Agent 48
12.7.   Non-Reliance on Collateral Agent and Other Lenders 48 12.8.   Collateral
and Guaranty Matters 48 12.9.   Reimbursement by Lenders 49 12.10. Notices and
Items to Lenders 49 13.   DEFINITIONS 50 13.1.   Definitions 50

 

EXHIBITS:

 

EXHIBIT A: Form of Loan Payment/Advance Request

EXHIBIT B: Form of Term Loan Note

EXHIBIT C: Form of Guaranty and Security Agreement

EXHIBIT D: Form of Compliance Certificate

EXHIBIT E: Commitments; Notice Addresses

 

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LOAN AGREEMENT

 

THIS LOAN AGREEMENT (this “Agreement”), dated as of February 6, 2020 (the
“Effective Date”) by and among COLLEGIUM PHARMACEUTICAL, INC., a Virginia
corporation (as “Borrower”), the Guarantors from time to time party hereto,
BIOPHARMA CREDIT PLC, a public limited company incorporated under the laws of
England and Wales (as the “Collateral Agent” and a “Lender”) and BIOPHARMA
CREDIT INVESTMENTS V (MASTER) LP, a Cayman Islands exempted limited partnership
(as a “Lender”), provides the terms on which each Lender shall make, and
Borrower shall repay, the Credit Extensions (as hereinafter defined). The
parties hereto agree as follows:

 

1.             ACCOUNTING AND OTHER TERMS

 

Except as otherwise expressly provided herein, all accounting terms not
otherwise defined in this Agreement shall have the meanings assigned to them in
conformity with Applicable Accounting Standards. Calculations and determinations
must be made following Applicable Accounting Standards. If at any time any
change in Applicable Accounting Standards would affect the computation of any
financial requirement set forth in any Loan Document, and either Borrower or the
Collateral Agent shall so request, the Collateral Agent and Borrower shall
negotiate in good faith to amend such requirement to preserve the original
intent thereof in light of such change in Applicable Accounting Standards;
provided, that, until so amended, such requirement shall continue to be computed
in accordance with Applicable Accounting Standards prior to such change therein.
Notwithstanding any other provision contained herein, all terms of an accounting
or financial nature used herein shall be construed, and all computations of
amounts referred to herein, including in Article V and Article VI shall be made,
without giving effect to any (a) election under ASC 825-10 (or any other
Financial Accounting Standards Board Accounting Standards Codification (“ASC”)
or Financial Accounting Standard having a similar result or effect) to value any
Indebtedness or other liabilities of any Credit Party or any Subsidiary of any
Credit Party at “fair value” and (b) any treatment of Indebtedness in respect of
convertible debt instruments under ASC 470-20 (or any other ASC or Financial
Accounting Standard having a similar result or effect) to value any such
Indebtedness in a reduced or bifurcated manner as described therein, and such
Indebtedness shall at all times be valued at the full stated principal amount
thereof. Notwithstanding anything to the contrary above or in the definition of
“Capital Lease Obligations”, all obligations of any Person that are or would
have been treated as operating leases for purposes of Applicable Accounting
Standards prior to the effectiveness of ASC 842 shall continue to be accounted
for as operating leases for all purposes hereunder or under any other Loan
Documents (whether or not such operating lease obligations were in effect on
such date) notwithstanding the fact that such obligations are required in
accordance with ASC 842 (on a prospective or retroactive basis or otherwise) to
be treated as Capital Leases. Capitalized terms not otherwise defined in this
Agreement shall have the meanings set forth in Section 13. All other terms
contained in this Agreement, unless otherwise indicated, shall have the meaning
provided by the Code to the extent such terms are defined therein. All
references to “Dollars” or “$” are United States Dollars, unless otherwise
noted.

 

2.             LOANS AND TERMS OF PAYMENT

 

2.1.         Promise to Pay. Borrower hereby unconditionally promises to pay
Lenders the outstanding principal amount of the Term Loans advanced to Borrower
by Lenders and accrued and unpaid interest thereon and any other amounts due
hereunder as and when due in accordance with this Agreement.

 

2.2.          Term Loans.

 

(a)            Availability. Subject to the terms and conditions of this
Agreement (including Sections 3.1 and 3.2), each Lender severally agrees to make
a term loan to Borrower on the Closing Date in an original principal amount
equal to such Lender’s Term Loan Commitment (collectively, the “Term Loans”).
After repayment or prepayment (in whole or in part), no Term Loan (or any
portion thereof) may be re-borrowed.

 

(b)           Repayment.

 

(i)            Subject to clause (ii) below, with respect to each Term Loan,
Borrower shall make equal quarterly payments of principal of such Term Loan
commencing on the first Payment Date on the 3rd-month anniversary of the Closing
Date and continuing on each subsequent Payment Date; provided, that if any such
Payment Date is not a Business Day, the applicable payment shall be due and
payable on the first Business Day immediately after such date.

 

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(ii)          The amount of the outstanding aggregate principal amount of the
Term Loans to prepaid with the Equity Proceeds Prepayment, if any, shall be
applied to reduce the remaining amortization payments in the inverse order of
maturity starting with the quarterly amortization payment payable on the Payment
Date that is the 48th-month anniversary of the Closing Date; or if such date is
not a Business Day, on the first Business Day immediately after such date.

 

(iii)          All unpaid principal with respect to the Term Loans (and, for the
avoidance of doubt, all accrued and unpaid interest, all due and unpaid Lender
Expenses and any and all other amounts payable under the Loan Documents) is due
and payable in full on the Term Loan Maturity Date. The Term Loans may be
prepaid only in accordance with Section 2.2(c), except as provided in Section
8.1.

 

(c)           Prepayment of Term Loans.

 

(i)            Borrower shall have the option, at any time after the Closing
Date, to prepay, in whole but not in part, the Term Loans advanced by Lenders
under this Agreement; provided that (A) Borrower provides written notice to the
Collateral Agent of its election (which shall be irrevocable unless the
Collateral Agent otherwise consents in writing) to prepay all of the Term Loans,
which notice shall include the amount of the outstanding aggregate principal
amount of the Term Loans to be prepaid, at least five (5) Business Days prior to
such prepayment, and (B) the prepayment of such principal shall be accompanied
by any and all accrued and unpaid interest thereon through the date of
prepayment and any amounts payable in connection with such prepayment pursuant
to Section 2.2(e) and Section 2.2(f) (as applicable), together with any and all
other amounts payable or accrued and not yet paid under this Agreement and the
other Loan Documents. The Collateral Agent will promptly notify each Lender of
its receipt of such notice and the amount of such Lender’s Applicable Percentage
of such prepayment.

 

(ii)           Upon a Change in Control, Borrower shall promptly, and in any
event no later than ten (10) days after the consummation of such Change in
Control, notify the Collateral Agent in writing of the occurrence of a Change in
Control, which notice shall include reasonable detail as to the nature, timing
and other circumstances of such Change in Control (such notice, a “Change in
Control Notice”). Borrower shall prepay in full the Term Loans advanced by
Lenders under this Agreement, no later than ten (10) Business Days after
delivery to the Collateral Agent of the Change in Control Notice, in an amount
equal to the sum of (A) the outstanding aggregate principal amount of the Term
Loans and any and all accrued and unpaid interest with respect to the Term Loans
to the date of prepayment, (B) any applicable amounts payable solely with
respect to the prepayment of such principal amount under this Section 2.2(c)(ii)
pursuant to Section 2.2(e) and Section 2.2(f) (as applicable) and (C) all other
amounts payable or accrued and not yet paid under this Agreement and the other
Loan Documents. The Collateral Agent will promptly notify each Lender of its
receipt of the Change in Control Notice and the amount of such Lender’s
Applicable Percentage of such prepayment.

 

(d)          Prepayment Application. Any prepayment of the Term Loans pursuant
to Section 2.2(c) (together with the applicable Makewhole Amount and Prepayment
Premium, if any, that is payable pursuant to Section 2.2(e) and Section 2.2(f))
shall be paid to Lenders in accordance with their respective Applicable
Percentages for application to the Obligations in the following order: (i)
first, to due and unpaid Lender Expenses; (ii) second, to accrued, unpaid and
uncapitalized interest at the Default Rate incurred pursuant to Section 2.3(b),
if any; (iii) third, without duplication of amounts paid pursuant to clause (ii)
above, to accrued and unpaid interest at the Term Loan Rate; (iv) fourth, to the
Prepayment Premium; (v) fifth, to the Makewhole Amount (if any); (vi) sixth, to
the outstanding principal amount of the Term Loans; and (vii) seventh, to any
remaining amounts then due and payable under this Agreement and the other Loan
Documents.

 

(e)           Makewhole Amount. Any prepayment of the Term Loans by Borrower (A)
pursuant to Section 2.2(c)(i) or Section 2.2(c)(ii) or (B) as a result of the
acceleration of the maturity of the Term Loans pursuant to Section 8.1(a), in
each case, occurring prior to the 2nd-year anniversary of the Closing Date,
shall be accompanied by payment of an amount equal to the Makewhole Amount;
provided, however, that, notwithstanding the foregoing, no payment of the
Makewhole Amount shall be applicable to any prepayment of the Term Loans by
Borrower pursuant to Section 2.2(c)(i) occurring prior to the 2nd-year
anniversary of the Closing Date that is an Equity Proceeds Prepayment. For the
avoidance of doubt, any prepayment of the Term Loans by Borrower pursuant to
Section 2.2(c)(ii) or as a result of the acceleration of the maturity of the
Term Loans pursuant to Section 8.1(a) occurring prior to the 2nd-year
anniversary of the Closing Date that is an Equity Proceeds Prepayment shall be
accompanied by payment of an amount equal to the Makewhole Amount.

 

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(f)            Prepayment Premium. Any prepayment of the Term Loans by Borrower
(A) pursuant to Section 2.2(c)(i) or Section 2.2(c)(ii) or (B) as a result of
the acceleration of the maturity of the Term Loans pursuant to Section 8.1(a)
shall be accompanied by payment of an amount equal to the General Prepayment
Premium; provided, however, that, notwithstanding the foregoing, any prepayment
of the Term Loans by Borrower pursuant to Section 2.2(c)(i) occurring prior to
the 2nd-year anniversary of the Closing Date that is an Equity Proceeds
Prepayment shall be accompanied by payment of an amount equal to the Equity
Proceeds Prepayment Premium. For the avoidance of doubt, any prepayment of the
Term Loans by Borrower pursuant to Section 2.2(c)(ii) or as a result of the
acceleration of the maturity of the Term Loans pursuant to Section 8.1(a)
occurring prior to the 2nd-year anniversary of the Closing Date that is an
Equity Proceeds Prepayment shall be accompanied by payment of an amount equal to
the General Prepayment Premium.

 

2.3.         Payment of Interest on the Credit Extensions.

 

(a)           Interest Rate.

 

(i)             Subject to Section 2.3(b), the principal amount outstanding
under each Term Loan shall accrue interest at a per annum rate equal to the
LIBOR Rate plus seven and one half percent (7.50%) per annum (the “Term Loan
Rate”), which interest shall be payable quarterly in arrears in accordance with
this Section 2.3.

 

(ii)            Interest shall accrue on each Term Loan commencing on, and
including, the day on which such Term Loan is made, and shall accrue on such
Term Loan, or any portion thereof, for the day on which such Term Loan or such
portion is paid.

 

(iii)           Except as otherwise expressly provided herein, interest is due
and payable quarterly on each Interest Date; provided, that if any such date is
not a Business Day, the applicable interest shall be due and payable on the
first Business Day immediately after such date.

 

(iv)          Notwithstanding anything to the contrary herein or in any other
Loan Document, upon the occurrence of a LIBOR Rate Transition Event or an Early
Opt-in Election, as applicable, the Collateral Agent, Borrower and Required
Lenders shall amend this Agreement and the Term Loan Notes to replace the LIBOR
Rate with the Alternate Benchmark Rate, and such Alternative Benchmark Rate
shall be effective from and after the Alternative Benchmark Start Date. Any such
amendments with respect to a LIBOR Rate Transition Event will become effective
at 5:00 p.m. on the third (3rd) Business Day after the Collateral Agent has
delivered such proposed amendments to all Lenders and Borrower so long as the
Collateral Agent has not received, by such time, written notice of objection to
such amendments from the Required Lenders. Any such amendments with respect to
an Early Opt-in Election will become effective on the date that the Required
Lenders have delivered to the Collateral Agent written notice that such Required
Lenders accept such amendments. No replacement of the LIBOR Rate with the
Alternate Benchmark Rate pursuant to this Section 2.3(a)(iv) will occur prior to
the applicable Alternate Benchmark Rate Start Date.

 

(b)           Default Rate. In the event Borrower fails to pay any of the
Obligations when due or upon the commencement and during the continuance of an
Insolvency Proceeding of the Borrower or upon the occurrence and during the
continuance of any other Event of Default, immediately (and without notice to
any Credit Party or demand by the Collateral Agent or any Lender for payment
therefor), the Obligations shall bear interest at a rate per annum which is
three percentage points (3.00%) above the rate that is otherwise applicable
thereto (the “Default Rate”), and shall be payable on the date specified herein;
provided, that in the case of any past due Obligations (if any), such interest
shall be payable entirely in cash on demand of the Collateral Agent or any
Lender. Payment or acceptance of the increased interest rate provided in this
Section 2.3(b) is not a permitted alternative to timely payment of any
Obligations and shall not constitute a waiver of any Event of Default or
otherwise prejudice or limit any rights or remedies of the Collateral Agent or
any Lender.

 

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(c)           360-Day Year. Interest shall be computed on the basis of a year of
360 days and the actual number of days elapsed.

 

(d)          Payments. Except as otherwise expressly provided herein, Borrower
shall make (or shall cause to be made on its behalf) all loan payments and any
other payments hereunder on the date specified herein to the bank account of
each Lender or the Collateral Agent, as applicable, as such Lender or the
Collateral Agent shall have designated in a written notice to Borrower delivered
on or before the Closing Date (which such notice may be updated by such Lender
or the Collateral Agent from time to time after the Closing Date). Any payment
of principal or interest received after 2:00 p.m. on the date such payment is
due and payable is considered received at the opening of business on the next
Business Day. When any payment is due and payable on a day that is not a
Business Day, such payment is due and payable on the immediately next Business
Day and additional fees or interest, as applicable, shall continue to accrue
until actually paid. Any and all payments to be made by (or on behalf of)
Borrower hereunder or under any other Loan Document, including payments of
principal, interest, fees, expenses, indemnities and reimbursements, shall be
made without set-off, recoupment or counterclaim, in lawful money of the United
States and in immediately available funds.

 

2.4.         Expenses. Borrower shall pay to or reimburse (or pay directly on
behalf of) the Collateral Agent and, as applicable, each Lender, all of such
Person’s Lender Expenses incurred through and after the Effective Date, promptly
after receipt of a written demand therefor by such Lender or the Collateral
Agent (with, in the case of any Lender, a copy of such demand to the Collateral
Agent), setting forth in reasonable detail such Person’s Lender Expenses;
provided, however, that for purposes of this Section 2.4 and solely in the case
of satisfying the condition precedent in Section 3.1(k), the parties hereto
agree that the funds flow memo prepared and delivered by the Collateral Agent in
advance of the Closing Date for attachment to the Payment/Advance Request for
the Term Loans shall constitute such written demand so long as reasonable detail
of the Lender Expenses set forth therein are delivered to Borrower no later than
two (2) Business Days following the Closing Date.

 

2.5.         Requirements of Law; Increased Costs. In the event that any
applicable Change in Law:

 

(a)           Does or shall subject any Lender to any Tax of any kind whatsoever
with respect to this Agreement or the Term Loans (except Indemnified Taxes,
Taxes described in clause (b) through (d) of the definition of Excluded Taxes,
and Connection Income Taxes);

 

(b)           Does or shall impose, modify or hold applicable any reserve,
capital requirement, special deposit, compulsory loan, insurance charge or
similar requirements against assets held by, or deposits or other liabilities in
or for the account of, advances or loans by, or other credit extended by, or any
other acquisition of funds by, any Lender; or

 

(c)           Does or shall impose on any Lender any other condition (other than
Taxes); and the result of any of the foregoing is to increase the cost to such
Lender (as determined by such Lender in good faith using calculation methods
customary in the industry) of making, renewing or maintaining the Term Loans or
to reduce any amount receivable in respect thereof or to reduce the rate of
return on the capital of such Lender or any Person controlling such Lender,

 

then, in any such case, Borrower shall promptly pay to the applicable Lender,
within thirty (30) days of its receipt of the certificate described below, any
additional amounts necessary to compensate such Lender for such additional cost
or reduced amounts receivable or rate of return as reasonably determined by such
Lender with respect to this Agreement or the Term Loans made hereunder. If any
Lender becomes entitled to claim any additional amounts pursuant to this Section
2.5, it shall promptly notify Borrower in writing of the event by reason of
which it has become so entitled (with a copy of such notice to the Collateral
Agent), and a certificate as to any additional amounts payable pursuant to the
foregoing sentence containing the calculation thereof in reasonable detail
submitted by such Lender to Borrower (with a copy of such certificate to the
Collateral Agent) shall be conclusive in the absence of manifest error. The
provisions hereof shall survive the termination of this Agreement and the
payment of the outstanding Term Loans and all other Obligations. Failure or
delay on the part of any Lender to demand compensation for any increased costs
or reduction in amounts received or receivable or reduction in return on capital
under this Section 2.5 shall not constitute a waiver of such Lender’s right to
demand such compensation; provided that Borrower shall not be under any
obligation to compensate such Lender under this Section 2.5 with respect to
increased costs or reductions with respect to any period prior to the date that
is 180 days prior to the date of the delivery of the notice required pursuant to
the foregoing provisions of this paragraph; provided, further, that if the
Change in Law giving rise to such increased costs or reductions is retroactive,
then the 180-day period referred to above shall be extended to include the
period of retroactive effect thereof.

 

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2.6.          Taxes; Withholding, Etc. 

 

(a)           All sums payable by any Credit Party hereunder and under the other
Loan Documents shall (except to the extent required by Requirements of Law) be
paid free and clear of, and without any deduction or withholding on account of,
any Tax imposed, levied, collected, withheld or assessed by any Governmental
Authority. In addition, Borrower agrees to pay, and shall indemnify and hold
each Lender harmless from, Other Taxes, and as soon as practicable after the
date of paying such sum, Borrower shall furnish to each Lender (as applicable,
with a copy to the Collateral Agent) the original or a certified copy of a
receipt evidencing payment thereof or other evidence reasonably satisfactory to
the Collateral Agent of such payment and of the remittance thereof to the
relevant taxing or other Governmental Authority.

 

(b)           If any Credit Party or any other Person (“Withholding Agent”) is
required by Requirements of Law to make any deduction or withholding on account
of any Tax (as determined in the good faith discretion of such Withholding
Agent) from any sum paid or payable by any Credit Party to any Lender under any
of the Loan Documents: (i) such Withholding Agent shall notify such Lender in
writing (with a copy to the Collateral Agent) of any such requirement or any
change in any such requirement promptly after such Withholding Agent becomes
aware of it; (ii) such Withholding Agent shall make any such withholding or
deduction; (iii) such Withholding Agent shall pay any such Tax before the date
on which penalties attach thereto in accordance with Requirements of Law; (iv)
if the Tax is an Indemnified Tax, the sum payable by such Withholding Agent in
respect of which the relevant deduction, withholding or payment of Indemnified
Tax is required shall be increased to the extent necessary to ensure that, after
the making of that deduction, withholding or payment (including any deductions
for Indemnified Taxes applicable to additional sums payable under this
Section 2.6(b)), such Lender receives on the due date a net sum equal to what it
would have received had no such deduction, withholding or payment of Indemnified
Tax been required or made; and (v) as soon as practicable after paying any sum
from which it is required by Requirements of Law to make any deduction or
withholding, Borrower shall (or shall cause such Withholding Agent, if not
Borrower, to) deliver to such Lender (with a copy to the Collateral Agent) the
original or a certified copy of a receipt evidencing payment thereof or other
evidence reasonably satisfactory to such Lender of such deduction, withholding
or payment and of the remittance thereof to the relevant taxing or other
Governmental Authority.

 

(c)            Borrower shall indemnify each Lender for the full amount of any
Indemnified Taxes (including Indemnified Taxes imposed or asserted on or
attributable to amounts payable under this Section 2.6(c)) paid by such Lender
and any liability (including any reasonable expenses) arising therefrom or with
respect thereto whether or not such Indemnified Taxes were correctly or legally
imposed or asserted by the relevant Governmental Authority. Any indemnification
payment pursuant to this Section 2.6(c) shall be made to the applicable Lender
within thirty (30) days from written demand therefor.

 

(d)           Any Lender that is entitled to an exemption from or reduction of
withholding Tax with respect to payments made under any Loan Document shall
deliver to Borrower and the Collateral Agent, at the time or times reasonably
requested in writing by Borrower or the Collateral Agent, such properly
completed and executed documentation as will permit such payments to be made
without withholding or at a reduced rate of withholding. In addition, such
Lender, if reasonably requested in writing by Borrower or the Collateral Agent,
shall deliver such other documentation prescribed by Requirements of Law or
otherwise required by Borrower or the Collateral Agent to enable Borrower or the
Collateral Agent to determine whether or not such Lender is subject to backup
withholding or information reporting requirements. Notwithstanding anything to
the contrary in the preceding two sentences, the completion, execution and
submission of such documentation (other than such documentation set forth in
Section 2.6(d)(i), (ii) or (iv) below) shall not be required if in such Lender’s
reasonable judgment such completion, execution or submission would subject such
Lender to any material unreimbursed cost or expense or would materially
prejudice the legal or commercial position of such Lender (it being acknowledged
and agreed that providing any information currently required by any U.S. federal
income tax withholding form is not considered at the Effective Date prejudicial
to the position of such Lender). For the avoidance of doubt, for the purposes of
this Section 2.6(d), the term “Lender” shall include each applicable assignee
thereof. Without limiting the generality of the foregoing:

 

5

 

 

(i)            If any Lender is a U.S. Person, such Lender shall deliver to
Borrower and the Collateral Agent, on or prior to the Closing Date and the date
on which a Lender Transfer involving such Lender occurs, as applicable, and at
such other times as may be necessary in the determination of Borrower (in the
reasonable exercise of its discretion) two (2) executed copies of Internal
Revenue Service (“IRS”) Form W-9 certifying that such Lender is exempt from U.S.
federal backup withholding tax.

 

(ii)           If any Lender is a Foreign Lender, such Lender shall deliver, and
shall cause each applicable assignee thereof to deliver, to Borrower and the
Collateral Agent, on or prior to, the Closing Date and, the date on which a
Lender Transfer involving such Lender occurs, as applicable, and at such other
times as may be necessary in the determination of Borrower (in the reasonable
exercise of its discretion):

 

(1)           in the case of a Foreign Lender claiming the benefits of an income
tax treaty to which the United States is a party (x) with respect to payments of
interest under any Loan Document, two (2) properly completed and duly executed
copies of IRS Form W-8BEN or IRS Form W-8BEN-E establishing an exemption from,
or reduction of, U.S. federal withholding Tax pursuant to the “interest” article
of such tax treaty and (y) with respect to any other applicable payments under
any Loan Document, a properly completed and duly executed copy of IRS Form
W-8BEN or IRS Form W-8BEN-E establishing an exemption from, or reduction of,
U.S. federal withholding Tax pursuant to the “business profits” or “other
income” article of such tax treaty;

 

(2)           two (2) completed and duly executed copies of IRS Form W-8ECI;

 

(3)           to the extent that such Foreign Lender is not the beneficial
owner, two (2) properly completed and duly executed copies of IRS W-8IMY and a
withholding statement, along with IRS Form W-9, W-8BEN-E, W-8BEN, W-8ECI or
other certification documents from each beneficial owner, as applicable;
provided that if the Foreign Lender is a partnership and one or more direct or
indirect partners of such Foreign Lender are claiming the portfolio interest
exemption, such Foreign Lender may provide a certificate referenced in Section
2.6(d)(ii)(4) below on behalf of each such direct and indirect partner; or

 

(4)           in the case of a Foreign Lender claiming the benefits of the
exemption for “portfolio interest” under Section 881(c) of the IRC, it shall
provide Borrower with two (2) properly completed and duly executed copies of IRS
Form W-8BEN-E or IRS Form W-8BEN, as applicable, and a certificate reasonably
satisfactory to Borrower to the effect that any interest received by such
Foreign Lender is not received by a “bank” on “extension of credit made pursuant
to a loan agreement entered into in the ordinary course of its trade or
business” within the meaning of 881(c)(3)(A) of the IRC, a “10 percent
shareholder” of Borrower within the meaning of Section 871(h)(3)(B) of the IRC,
or a “controlled foreign corporation” related to Borrower as described in
Section 881(c)(3)(C) of the IRC.

 

(iii)           If any Lender is a Foreign Lender it shall, to the extent it is
legally entitled to do so, deliver to Borrower (in such number of copies as
shall be requested by the recipient) on or prior to the date on which such its
becomes a party to this Agreement (and from time to time thereafter upon the
reasonable request of Borrower), executed copies of any other form prescribed by
applicable law as a basis for claiming exemption from or a reduction in U.S.
federal withholding Tax, duly completed, together with such supplementary
documentation as may be prescribed by applicable law to permit Borrower to
determine the withholding or deduction required to be made.

 

(iv)          If a payment made to any Lender under any Loan Document would be
subject to U.S. federal withholding Tax imposed by FATCA if such Lender were to
fail to comply with the applicable reporting requirements of FATCA (including
those contained in Section 1471(b) or 1472(b) of the IRC, as applicable), such
Lender shall deliver to Borrower and the Collateral Agent at the time or times
prescribed by law and at such time or times reasonably requested by Borrower or
the Collateral Agent such documentation prescribed by applicable law (including
as prescribed by Section 1471(b)(3)(C)(i) of the IRC) and such additional
documentation reasonably requested by Borrower or the Collateral Agent as may be
necessary for Borrower (and, to the extent applicable, the Collateral Agent) to
comply with their obligations under FATCA and to determine that Lender has
complied with its obligations under FATCA or to determine the amount to deduct
and withhold from such payment. Solely for purposes of this clause (iv), “FATCA”
shall include any amendments made to FATCA after the date of this Agreement.

 

6

 

 

(v)           If any Lender is required to deliver any forms, statements,
certificates or other evidence with respect to United States federal Tax or
backup withholding matters pursuant to this Section 2.6(d), such Lender hereby
agrees, from time to time after the initial delivery by such Lender of such
forms, certificates or other evidence, whenever a lapse in time, change in
circumstances or law, or additional guidance by a Governmental Authority renders
such forms, certificates or other evidence obsolete or inaccurate in any
material respect, to promptly deliver to Borrower two (2) new original copies of
updated or successor forms, certificates or evidence, as applicable.

 

(e)            If any party hereto determines, in its discretion exercised in
good faith, that it has received a refund of any Taxes or a credit or offset for
any Taxes as to which it has been indemnified pursuant to this Section 2.6
(including by the payment of additional amounts pursuant to this Section 2.6),
it shall pay to the indemnifying party an amount equal to such refund, credit or
offset (but only to the extent of indemnity payments made, or additional amounts
paid, under this Section 2.6 with respect to the Taxes giving rise to such
refund), net of all out-of-pocket expenses (including Taxes) of such indemnified
party and without interest (other than any interest paid by the relevant
Governmental Authority with respect to such refund). Such indemnifying party,
upon the request of such indemnified party, shall repay to such indemnified
party the amount paid over pursuant to this clause (e) in the event that such
indemnified party is required to repay, credit or offset such refund to such
Governmental Authority and the requirement to repay such refund to such
Governmental Authority is not due to the indemnified party’s failure to timely
provide complete and accurate IRS forms and other documentation required
pursuant to Section 2.6(d) or Section 2.8. Notwithstanding anything to the
contrary in this clause (e), in no event will the indemnified party be required
to pay any amount to an indemnifying party pursuant to this clause (e) if the
payment of such amount would place the indemnified party in a less favorable net
after-Tax position than the indemnified party would have been in if the
indemnification payments or additional amounts giving rise to such refund had
not been deducted, withheld or otherwise imposed and the indemnification
payments or additional amounts with respect to such tax had never been paid.
This clause (e) shall not be construed to require any indemnified party to make
available its Tax returns (or any other information relating to its Taxes that
it deems confidential) to the indemnifying party or any other Person.

 

(f)            If any Lender requests compensation under Section 2.5, or
requires Borrower to pay any Indemnified Taxes or additional amounts to any
Lender or any Governmental Authority for the account of any Lender pursuant to
this Section 2.6, then such Lender shall (at the written request of Borrower)
use commercially reasonable efforts to designate a different lending office for
funding or booking its Term Loans hereunder or to assign its rights and
obligations hereunder to another of its offices, branches or affiliates, if, in
the judgment of such Lender, such designation or assignment (i) would eliminate
or reduce amounts payable pursuant to Section 2.5 or 2.6, as the case may be, in
the future, and (ii) would not subject such Lender to any unreimbursed cost or
expense and would not otherwise be disadvantageous to such Lender. Borrower
hereby agrees to pay all reasonable costs and expenses incurred by any Lender in
connection with any such designation or assignment.

 

2.7.          Additional Consideration. As additional consideration for the
obligations of each Lender to fund its Applicable Percentage of the Term Loan
Amount pursuant to Section 2.2 and Section 3.4, on the Closing Date, Borrower
shall pay to each Lender an amount equal to the product of (a) the amount of the
Term Loan advanced by such Lender on the Closing Date, multiplied by (b) two and
one-half percent (2.50%) (such product, individually or collectively as the
context dictates, the “Additional Consideration”). The Additional Consideration
shall be fully earned when paid and shall not be refundable for any reason
whatsoever and such Additional Consideration shall be treated as original issue
discount for U.S. federal income tax purposes.

 

7

 

 

2.8.          Evidence of Debt; Register; Collateral Agent’s Books and Records;
Term Loan Notes.

 

(a)            Evidence of Debt; Register. Notwithstanding anything herein to
the contrary, Borrower hereby designates the Collateral Agent to serve as
Borrower’s agent solely for purposes of maintaining at all times at the
Collateral Agent’s principal office a “book entry system” as described in
Treasury Regulations Section 5f.103-1(c)(1)(ii) that identifies each beneficial
owner that is entitled to a payment of principal and stated interest on each
Term Loan (the “Register”) so that each Term Loan is at all times in “registered
form” as described in IRC Treasury Regulations Section 5f.103-1(c) or Proposed
Section 1.163-5(b) (or any amended or successor version). The Collateral Agent
is hereby authorized by Borrower to record in the manual or data processing
records of the Collateral Agent, the date and amount of each advance and the
amount of the outstanding Obligations and the date and amount of each repayment
of principal and each payment of interest or otherwise on account of the
Obligations. Absent manifest error, such records of the Collateral Agent shall
be conclusive as to the outstanding principal amount of the total outstanding
Obligations, and the payment of interest, principal and other sums due
hereunder; provided, however, that the failure of the Collateral Agent to make
any such record entry with respect to any payment shall not limit or otherwise
affect the obligations of Borrower under the Loan Documents. Each Term Loan: (i)
shall, pursuant to this clause (a), be also registered as to both principal and
any stated interest with Borrower or its agent, and (ii) may be transferred by
any Lender only by (1) surrender of the old instrument and either (x) the
reissuance by Borrower of the old instrument to the new Lender or (y) the
issuance by Borrower of a new instrument to the new Lender, or (2) confirmation
with Borrower that the right to the principal and stated interest on such Term
Loan is maintained through the book entry system kept by the Collateral Agent.
Each Lender, severally and not jointly with any other Lender, represents that
any interest that may become due and owing under this Agreement qualifies for
the portfolio interest exception from withholding on interest payments pursuant
to IRC Sections 871(h) and 881(c).

 

(b)            Term Loan Notes. Borrower shall execute and deliver to each
Lender to evidence such Lender’s Term Loan, a Term Loan Note.

 

3.              CONDITIONS TO EFFECTIVENESS AND TERM LOANS

 

3.1.          Conditions Precedent to Effectiveness. The effectiveness of this
Agreement is subject to the satisfaction (or waiver in accordance with Section
11.5 hereof) of the following conditions (it being understood that by their
respective execution and delivery of this Agreement, the Collateral Agent and
Lenders hereby confirm that the conditions to effectiveness of this Agreement
described in this Section 3.1 have been satisfied or waived in accordance with
Section 11.5 hereof) as of the Effective Date:

 

(a)            the Collateral Agent’s and each Lender’s receipt of copies of the
Loan Agreement, the Disclosure Letter to the Loan Agreement, the Perfection
Certificate and the Payment/Advance Form, in each case dated as of the Effective
Date, executed and delivered by each applicable Credit Party and in form and
substance reasonably satisfactory to the Collateral Agent);

 

(b)           the Collateral Agent’s receipt of (i) true, correct and complete
copies of the Operating Documents of each of the Credit Parties, and (ii) a
Secretary’s Certificate for each Credit Party, dated the Effective Date and
signed by such Credit Party’s Secretary (or similar officer), certifying that
the foregoing copies are true, correct and complete (such Secretary’s
Certificate(s) to be in form and substance reasonably satisfactory to the
Collateral Agent);

 

(c)            the Collateral Agent’s receipt of true, correct and complete
copies of the Acquisition Agreement as it exists on the Effective Date, in form
and substance reasonably satisfactory to the Collateral Agent and Lenders;

 

(d)           the Collateral Agent’s receipt of a good standing certificate for
each Credit Party (where applicable), certified by the Secretary of State (or
the equivalent thereof) of the jurisdiction of incorporation or formation of
such Credit Party as of a date no earlier than thirty (30) days prior to the
Effective Date;

 

(e)           the Collateral Agent’s receipt of a Secretary’s Certificate with
completed Borrowing Resolutions with respect to the Loan Documents and the Term
Loans for each Credit Party, dated the Effective Date and signed by such Credit
Party’s Secretary (or similar officer) (such Secretary’s Certificates to be in
form and substance reasonably satisfactory to the Collateral Agent);

 

8

 

 

(f)            each Credit Party shall have obtained any and all Governmental
Approvals and consents of other Persons that are necessary in connection with
the transactions contemplated by the Loan Documents, each of which (if any)
shall be in full force and effect (and in form and substance reasonably
satisfactory to the Collateral Agent);

 

(g)           subject to Section 5.14, the Collateral Agent’s receipt of (i)
evidence that any products liability and general liability insurance policies
maintained in the United States regarding any Collateral are in full force and
effect and (ii) appropriate evidence showing the Collateral Agent, in such
capacity for the benefit of Lenders and the other Secured Parties, having been
named as additional insured or loss payee, as applicable (such evidence to be in
form and substance reasonably satisfactory to the Collateral Agent);

 

(h)           the Collateral Agent’s receipt of all documentation and other
information required by bank regulatory authorities under applicable
“know-your-customer” and anti-money laundering rules and regulations, including
the U.S.A. Patriot Act (Title III of Pub. L. 107-56 (signed into law October 26,
2001)) (the “Patriot Act”), in form and substance reasonably satisfactory to the
Collateral Agent; and

 

(i)            the Collateral Agent’s receipt of an Officer’s Certificate, dated
the Effective Date and signed by a Responsible Officer of Borrower, confirming
there is no Adverse Proceeding pending or, to the Knowledge of Borrower,
threatened, that, individually or in the aggregate, could reasonably be expected
to result in a Material Adverse Change, except as set forth on Schedule 4.7 of
the Disclosure Letter (such Officer’s Certificate to be in form and substance
reasonably satisfactory to the Collateral Agent).

 

3.2.         Conditions Precedent to Term Loans. The obligation of each Lender
to advance its Applicable Percentage of the Term Loan Amount on the Closing Date
is subject to the following conditions precedent:

 

(a)           the Collateral Agent’s and each Lender’s receipt of copies of all
other Loan Documents not described in Section 3.1(a) hereof (including the Term
Loan Notes, executed by Borrower, and the Collateral Documents, but excluding
any Control Agreements and any other Loan Document described in Schedule 5.14 of
the Disclosure Letter to be delivered after the Closing Date), executed and
delivered by each applicable Credit Party (in form and substance reasonably
satisfactory to the Collateral Agent); provided that, to the extent any lien on
any Collateral (including the creation or perfection of any security interest
therein) purported to be granted (or created) under any Collateral Document is
not or cannot be granted (or created or perfected) on the Closing Date (other
than (i) the Equity Interests in each Credit Party’s direct U.S. Wholly Owned
Subsidiaries that are purported to be granted or created pursuant to this
Agreement or any other Loan Document, and (ii) each of the other assets or
properties of Borrower and each Guarantor to the extent that a lien on and
security interest in such Collateral may be perfected by means of (A) the filing
of a Uniform Commercial Code financing statement or such other financing
statement, (B) taking delivery and possession of certificated securities or (C)
the filing of a IP Security Agreement with the United States Patent and
Trademark Office or the United States Copyright Office (as applicable), it being
understood that such financing statements and IP Security Agreement shall be
delivered at closing, but pre-filing thereof shall not be a condition to funding
of the Term Loan), after the Credit Parties’ use of commercially reasonable
efforts to do so, then the grant (or creation or perfection) of such lien
thereon and security interest therein shall not constitute a condition precedent
to the availability of the Term Loans on the Closing Date hereunder, but,
instead, shall be required to be granted, created or perfected (as applicable)
within thirty (30) days after the Closing Date (or such later date after the
Closing Date as the Collateral Agent may agree in its sole discretion);
provided, further, that the Loan Documents shall not contain any conditions to
the availability and funding of the Term Loans hereunder other than as
explicitly set forth in Section 3 hereof (the “Funds Certain Provisions”);

 

(b)           the Collateral Agent’s receipt of an opinion of Pepper Hamilton
LLP, counsel to all of the Credit Parties, duly executed, dated the Closing Date
and addressed to the Collateral Agent and each Lender (such opinion to be in
form and substance reasonably satisfactory to the Collateral Agent);

 

(c)           subject to the Funds Certain Provisions, the Collateral Agent’s
receipt of all documents and instruments necessary to grant a first priority
security interest in and Lien upon, and pledge to the Collateral Agent for the
benefit of Lenders and the other Secured Parties, free and clear of all Liens
other than Permitted Liens, the Collateral shall have been executed (to the
extent applicable) and delivered to the Collateral Agent and, if applicable, be
in appropriate form for filing (in form and substance reasonably satisfactory to
the Collateral Agent);

 

9

 

 

(d)           [Reserved];

 

(e)           each of the representations and warranties made by the Credit
Parties (i) in Section 4.1(a) (as to each Credit Party only), Section
4.1(b)(ii), Section 4.3(a), Section 4.3(b)(i)  Section 4.5, Section 4.9, Section
4.13(a), Section 4.14, and Section 4.18(d), and (ii) subject to the Funds
Certain Provisions and solely to the extent that a breach thereof is (or would
be) materially adverse to the interests of the Collateral Agent or Lenders with
respect to any lien on any of the assets or properties described therein
(including the creation or perfection of any security interest therein), Section
4.6(s), is true and correct in all material respects on the Closing Date (both
with and without giving effect to the Term Loans and the consummation of the
transactions contemplated by the Acquisition Agreement), unless such
representation or warranty is expressly stated to relate to a specific earlier
date, in which case such representation or warranty shall be true and correct in
all material respects as of such earlier date (it being understood that any such
representation or warranty that is qualified as to “materiality,” “Material
Adverse Change,” or similar language shall be true and correct in all respects
on the Closing Date (both with and without giving effect to the Term Loans and
the consummation of the transactions contemplated by the Acquisition Agreement)
or as of such earlier date, as applicable);

 

(f)            each of the Specified Acquisition Agreement Representations is
true and correct in all material respects on the Closing Date (both with and
without giving effect to the consummation of the transactions contemplated by
the Acquisition Agreement and the Term Loans), unless such representation or
warranty is expressly stated to relate to a specific earlier date, in which case
such representation or warranty shall be true and correct in all material
respects as of such earlier date (it being understood that any such
representation or warranty that is qualified as to “materiality,” “material
adverse effect”, “Material Adverse Effect,” or similar language shall be true
and correct in all respects on the Closing Date (both with and without giving
effect to the consummation of the transactions contemplated by the Acquisition
Agreement and the Term Loans) or as of such earlier date, as applicable);

 

(g)           (i)            substantially concurrently with the funding of the
Term Loans hereunder, the transactions contemplated by the Acquisition Agreement
shall be consummated in accordance with the terms and conditions of the
Acquisition Agreement delivered to the Collateral Agent on the Effective Date
without giving effect to any waiver or consent thereunder or any modification
thereto that is materially adverse to the interests of the Collateral Agent or
Lenders; provided, however, that for purposes of determining satisfaction of the
condition precedent contained herein, (A) any increase in the Estimated Purchase
Price shall be deemed to be materially adverse to the interests of the
Collateral Agent and Lenders unless such increase is funded solely with the
proceeds of any additional Equity Interests issued by Borrower or as otherwise
approved in writing by the Collateral Agent and Lenders; (B) any decrease in the
Estimated Purchase Price by ten percent (10%) or less shall be deemed to be
materially adverse to the interests of the Collateral Agent and Lenders unless
such decrease shall reduce on a dollar-for-dollar basis the aggregate principal
amount of the Term Loans (to be effected through a reduction of the quarterly
amortization payments of principal set forth in Section 2.2(b)(i)); (C) any
decrease in the Estimated Purchase Price by more than ten percent (10%) shall be
deemed to be materially adverse to the interests of the Collateral Agent and
Lenders; (D) any change in third party beneficiary rights applicable to the
Collateral Agent or any Lender under, or any change in the governing law of, the
Acquisition Agreement, shall be deemed to be materially adverse to the interests
of the Collateral Agent and Lenders unless such change is approved in writing by
the Collateral Agent and Lenders; and (E) any amendment, waiver or consent to
the definition of “Material Adverse Effect” (or similar term) as used in the
Acquisition Agreement shall be deemed to be materially adverse to the interests
of the Collateral Agent and Lenders;

 

(ii)           a certificate of a Responsible Officer of Borrower, dated the
Closing Date, confirming that all of the conditions to completion of the
transactions contemplated by the Acquisition Agreement, other than payment of
the Estimated Purchase Price, have been satisfied and that upon funding of the
Term Loan and application of the proceeds thereof in accordance with the closing
funds flow such transactions will be consummated by the parties thereto in
accordance with their respective terms; and

 

(iii)          the Collateral Agent’s receipt of true, correct and complete
copies of the Acquisition Agreement as executed and delivered by all parties
thereto, in the form delivered to the Collateral Agent on the Effective Date,
except for any modifications thereto or any waivers or consents thereunder that,
individually or taken together with any other modifications, waivers or
consents, are not materially adverse to the interests of the Collateral Agent or
Lenders;

 

10

 

 

(h)           since the Effective Date (as defined in the Acquisition
Agreement), there shall have been no events or occurrences that have resulted in
any Material Adverse Effect (as defined in the Purchase Agreement);

 

(i)            [reserved];

 

(j)            payment of the Additional Consideration concurrent with the
funding of the Term Loans;

 

(k)           [reserved]; and

 

(l)            payment of any and all accrued Lender Expenses as specified in
Section 2.4 hereof (to the extent invoiced at least two (2) Business Days prior
to the Closing Date) concurrent with the funding of the Term Loans; and

 

(m)          the Collateral Agent’s receipt of an Officer’s Certificate, dated
the Closing Date and signed by a Responsible Officer of Borrower, confirming
satisfaction of the conditions precedent set forth in Section 3.1 and Section
3.2 (but not, for the avoidance of doubt, the satisfaction of the Collateral
Agent or any Lender with respect to any document or action specified in any such
condition precedent as being subject to the satisfaction of the Collateral Agent
or any Lender), to be in form and substance reasonably satisfactory to the
Collateral Agent.

 

3.3.         Covenant to Deliver. The Credit Parties agree to deliver to the
Collateral Agent and each Lender each item required to be delivered to the
Collateral Agent or all Lenders under this Agreement as a condition precedent to
any Credit Extension; provided, however, that any such items set forth on
Schedule 5.14 of the Disclosure Letter shall be delivered to the Collateral
Agent within the time period prescribed therefor on such schedule. The Credit
Parties expressly agree that a Credit Extension made prior to the receipt by the
Collateral Agent and Lenders of any such item shall not constitute a waiver by
the Collateral Agent or any Lender of the Credit Parties’ obligation to deliver
such item, and the making of any Credit Extension in the absence of any such
item required to have been delivered to the Collateral Agent and Lenders by the
date of such Credit Extension shall be in each Lender’s sole discretion.

 

3.4.         Procedures for Borrowing. Subject to the prior satisfaction of all
other applicable conditions to the making of the Term Loans set forth in this
Agreement, to obtain the Term Loans, Borrower shall deliver to the Collateral
Agent and Lenders by electronic mail or facsimile a completed Payment/Advance
Request for the Term Loans, executed by a Responsible Officer of Borrower (which
notice shall be irrevocable on and after the date on which such notice is given
and Borrower shall be bound to make a borrowing in accordance therewith), in
which case each Lender agrees to advance its Applicable Percentage of the Term
Loan Amount to Borrower on the Closing Date by wire transfer of same day funds
in Dollars, to such account in the United States as may be designated in writing
to the Collateral Agent by Borrower prior to the Closing Date.

 

4.             REPRESENTATIONS AND WARRANTIES

 

In order to induce each Lender and the Collateral Agent to enter into this
Agreement and for each Lender to make the Credit Extensions to be made on the
Closing Date, each Credit Party, jointly and severally with each other Credit
Party, represents and warrants to each Lender and the Collateral Agent that the
following statements are true and correct as of the Effective Date (including
giving pro forma effect to the Term Loans and the consummation of the
transactions contemplated by the Acquisition Agreement) and, solely with respect
to each of the representations or warranties set forth in Section 3.2(e), as of
the Closing Date (both with and without giving effect to the Term Loans and the
consummation of the transactions contemplated by the Acquisition Agreement):

 

4.1.         Due Organization, Existence, Power and Authority. Each of Borrower
and each of its Subsidiaries: (a) is duly incorporated, organized or formed, and
validly existing and, where applicable, in good standing under the laws of its
jurisdiction of incorporation, organization or formation identified on Schedule
4.15 of the Disclosure Letter; (b) has all requisite power and authority to (i)
own, lease, license and operate its assets and properties and to carry on its
business as currently conducted in the ordinary course of business and (ii)
execute and deliver the Loan Documents to which it is a party and to perform its
obligations thereunder and otherwise carry out the transactions contemplated
thereby; (c) is duly qualified and, where applicable, in good standing under the
laws of each jurisdiction where its ownership, lease, license or operation of
assets or properties or the conduct of its business requires such qualification;
and (d) has all requisite Governmental Approvals to operate its business as
currently conducted; except in each described in clauses (a) (other than with
respect to Borrower and any other Credit Party), (b)(i), (c) or (d) above, to
the extent that failure to do so could not, individually or in the aggregate,
reasonably be expected to result in a Material Adverse Change.

 

11

 

 

4.2.         Equity Interests. All of the outstanding Equity Interests in each
Subsidiary of the Borrower, the Equity Interests in which are required to be
pledged pursuant to the Collateral Documents, have been duly authorized and
validly issued, are fully paid and, in the case of Equity Interests representing
corporate interests, are non-assessable and, on the Closing Date, all such
Equity Interests owned directly by Borrower or any other Credit Party are owned
free and clear of all Liens except for Permitted Liens. Schedule 4.2 of the
Disclosure Letter identifies each Person, the Equity Interests in which are
required to be pledged on the Closing Date pursuant to the Collateral Documents.

 

4.3.         Authorization; No Conflict. Except as set forth on Schedule 4.3 of
the Disclosure Letter, the execution, delivery and performance by each Credit
Party of the Loan Documents to which it is a party, and the consummation of the
transactions contemplated thereby, (a) have been duly authorized by all
necessary corporate or other organizational action and (b) do not and will not
(i) contravene the terms of any of such Credit Party’s Operating Documents, (ii)
conflict with or result in any breach or contravention of, or require any
payment to be made under (A) any provision of any security issued by such Credit
Party or of any agreement, instrument or other undertaking to which such Credit
Party is a party or affecting such Credit Party or the assets or properties of
such Credit Party or any of its Subsidiaries or (B) any order, writ, judgment,
injunction, decree, determination or award of any Governmental Authority by
which such Credit Party or any of its properties or assets are subject, (iii)
result in the creation of any Lien (other than under the Loan Documents) or (iv)
violate any Requirements of Law, except, in the cases of clauses (b)(ii) and
(b)(iv) above, to the extent that such conflict, breach, contravention, payment
or violation could not, individually or in the aggregate, reasonably be expected
to result in a Material Adverse Change. With respect to the Operating Documents
of Borrower, there has been no amendment, restatement, supplement or other
modification to the Articles of Incorporation of Borrower since December 11,
2015, other than to change the address of Borrower’s registered agent in the
state of Virginia.

 

4.4.         Government Consents; Third Party Consents. Except as set forth on
Schedule 4.4 of the Disclosure Letter, no Governmental Approval or other
approval, consent, exemption or authorization, or other action by, or notice to,
or filing with, any Governmental Authority or any other Person (including any
counterparty to any Material Contract) is necessary or required in connection
with (a) the execution, delivery or performance by, or enforcement against, any
Credit Party of this Agreement or any other Loan Document, or for the
consummation of the transactions contemplated hereby or thereby, (b) the grant
by any Credit Party of the Liens granted by it pursuant to the Collateral
Documents, (c) the perfection or maintenance of the Liens created under the
Collateral Documents (including the priority thereof), or (d) the exercise by
the Collateral Agent or any Lender of its rights under the Loan Documents or the
remedies in respect of the Collateral pursuant to the Collateral Documents,
except, in each case of clause (a) through (d) above, for (i) filings necessary
to perfect the Liens on the Collateral granted by the Credit Parties to the
Collateral Agent for the benefit of Lenders and the other Secured Parties, (ii)
the approvals, consents, exemptions, authorizations, actions, notices and
filings which have been duly obtained, taken, given or made and are in full
force and effect, (iii) filings under state or federal securities laws and (iv)
those approvals, consents, exemptions, authorizations or other actions, notices
or filings, the failure of which to obtain or make could not, individually or in
the aggregate, reasonably be expected to result in a Material Adverse Change.

 

4.5.         Binding Obligation. Each Loan Document has been duly executed and
delivered by each Credit Party that is a party thereto and constitutes a legal,
valid and binding obligation of such Credit Party, enforceable against such
Credit Party in accordance with its respective terms, except as such
enforceability may be limited by bankruptcy, insolvency, reorganization,
moratorium or similar laws relating to or limiting creditors’ rights generally
or by general principles of equity.

 

4.6.         Collateral. In connection with this Agreement, the Credit Parties
have delivered to the Collateral Agent a completed, omnibus certificate, duly
signed by each Credit Party (the “Perfection Certificate”). Each Credit Party,
jointly and severally, represents and warrants to the Collateral Agent and each
Lender that:

 

(a)           (i) its exact legal name is that indicated on the Perfection
Certificate and on the signature page hereof; (ii) it is an organization of the
type and is organized in the jurisdiction set forth in the Perfection
Certificate; (iii) the Perfection Certificate accurately sets forth its
organizational identification number or accurately states that it has none; (iv)
the Perfection Certificate accurately sets forth its place of business, or, if
more than one, its chief executive office as well as its mailing address (if
different than its chief executive office); (v) except as disclosed on the
Perfection Certificate, it (and each of its predecessors) has not, in the five
(5) years prior to the Closing Date, changed its jurisdiction of formation,
organizational structure or type, or any organizational number assigned by its
jurisdiction; and (vi) all other information set forth on the Perfection
Certificate pertaining to it and each of its Subsidiaries is accurate and
complete in all material respects. If any Credit Party is not now a Registered
Organization but later becomes one, it shall promptly notify the Collateral
Agent of such occurrence and provide the Collateral Agent with such Credit
Party’s organizational identification number.

 

12

 

 

(b)           (i) it has good title to, has rights in, and subject to Permitted
Subsidiary Distribution Restrictions, the power to transfer (or, with respect to
any Collateral to be acquired pursuant to the Acquisition Agreement, following
the consummation of the transactions contemplated by the Acquisition Agreement,
will have good title to, rights in and, subject to Permitted Subsidiary
Distribution Restrictions, the power to transfer) each item of the Collateral
upon which it purports to grant a Lien under any Collateral Document, free and
clear of any and all Liens except Permitted Liens, except for such minor
irregularities or defects in title as could not, individually or in the
aggregate, reasonably be expected to result in a Material Adverse Change, and
(ii) it has no deposit accounts maintained at a bank or other depository or
financial institution located in the United States other than the deposit
accounts described in the Perfection Certificate delivered to the Collateral
Agent in connection herewith.

 

(c)           (i)            A true, correct and complete list of each pending,
registered, or issued Patent, Copyright and Trademark that, individually or
taken together with any other such Patents, Copyrights or Trademarks, is
material to the business of Borrower and its Subsidiaries, taken as a whole,
relating to the research, development, manufacture, production, use,
commercialization, marketing, importing, storage, transport, offer for sale,
distribution or sale of any Product in the Territory, that is owned or co-owned
by or exclusively or non-exclusively licensed to any Credit Party or any of its
Subsidiaries, excluding any Current Acquisition IP set forth on Schedule
4.6(c)(ii)(A) of the Disclosure Letter (collectively, the “Current Company IP”),
including its name/title, current owner or co-owners, registration, patent or
application number and registration or application date, issued or filed in the
Territory, is set forth on Schedule 4.6(c)(i)(A) of the Disclosure Letter.
Except as set forth on Schedule 4.6(c)(i)(B) of the Disclosure Letter, (A) to
the Knowledge of Borrower, (1) each item of Current Company IP owned or co-owned
by a Credit Party or any of its Subsidiaries is valid, subsisting and
enforceable (or will be enforceable, upon issuance) and no such item of Current
Company IP owned or co-owned by a Credit Party or any of its Subsidiaries has
lapsed, expired, been cancelled or invalidated or become abandoned or
unenforceable, and (2) no written notice has been received challenging the
inventorship or ownership, or relating to any lapse, expiration, invalidation,
abandonment or unenforceability of any such item of Current Company IP owned or
co-owned by a Credit Party or any of its Subsidiaries, and (B) to the Knowledge
of Borrower, (1) each item of Current Company IP which is licensed by a Credit
Party or any of its Subsidiaries from another Person is valid, subsisting and
enforceable and no such item of Current Company IP which is licensed by a Credit
Party or any of its Subsidiaries has lapsed, expired, been cancelled or
invalidated, or become abandoned or unenforceable, and (2) no written notice has
been received challenging the inventorship or ownership, or relating to any
lapse, expiration, invalidation, abandonment or unenforceability, of any such
item of Current Company IP which is licensed by a Credit Party or any of its
Subsidiaries. Except as set forth on Schedule 4.6(c)(i)(C) of the Disclosure
Letter, (x) each Person who has or has had any rights in or to Current Company
IP or any trade secrets owned, co-owned or licensed by any Credit Party or any
of its Subsidiaries, including each inventor named on the Patents within such
Current Company IP filed by any Credit Party or any of its Subsidiaries, has
executed an agreement assigning his, her or its entire right, title and interest
in and to such Current Company IP or trade secrets (as applicable), and the
inventions, improvements, ideas, discoveries, writings, works of authorship,
information and other intellectual property embodied, described or claimed
therein, to the stated owner(s) thereof, and (y) to the Knowledge of Borrower,
no such Person has any contractual or other obligation that would preclude or
conflict with such assignment or the exploitation of any Product in the
Territory or entitle such Person to ongoing payments;

 

(ii)           A true, correct and complete list of each pending, registered,
issued or in-licensed Patent, Copyright and Trademark existing as of the
Effective Date, including any and all Transferred IP Rights (as defined in the
Purchase Agreement) that, after giving effect to the transactions contemplated
by the Acquisition Agreement, will be owned or co-owned by or exclusively or
non-exclusively licensed to any Credit Party or any of its Subsidiaries and,
individually or taken together with any other such Patents, Copyrights or
Trademarks (including any Transferred IP Rights (as defined in the Purchase
Agreement)), is material to the business of Borrower or any of its Subsidiaries
(collectively, the “Current Acquisition IP”), including its name/title, current
owner or co-owners (immediately after giving effect to the acquisition thereof
pursuant to the Acquisition Agreement), registration, patent or application
number and registration or application date, is set forth on Schedule
4.6(c)(ii)(A) of the Disclosure Letter. Immediately after giving effect to the
acquisition of the Current Acquisition IP pursuant to the Acquisition Agreement,
except as set forth on Schedule 4.6(c)(ii)(B) of the Disclosure Letter: (A) to
the Knowledge of Borrower, (1) each item of Current Acquisition IP owned or
co-owned by any Credit Party or any of its Subsidiaries is valid, subsisting and
enforceable (or will be enforceable, upon issuance) and no such item of Current
Acquisition IP has lapsed, expired, been cancelled or invalidated or become
abandoned or unenforceable, and (2) no written notice has been received by any
Credit Party or any of its Subsidiaries or by Assertio Therapeutics, Inc. or any
of its Affiliates challenging the inventorship or ownership, or relating to any
lapse, expiration, invalidation, abandonment of, or scope, validity or
enforceability of, any such item of Current Acquisition IP; and (B) to the
Knowledge of Borrower, (1) each item of Current Acquisition IP that is licensed
by a Credit Party or any of its Subsidiaries from another Person is valid,
subsisting and enforceable and no such item of Current Acquisition IP has
lapsed, expired, been cancelled or invalidated or become abandoned or
unenforceable, and (2) no written notice has been received by any Credit Party
or any of its Subsidiaries or by Assertio Therapeutics, Inc. or any of its
Affiliates challenging the inventorship or ownership, or relating to any lapse,
expiration, invalidation, abandonment of, or scope, validity or enforceability
of, any such item of Current Acquisition IP. Immediately after giving effect to
the acquisition of the Current Acquisition IP pursuant to the Acquisition
Agreement, except as set forth on Schedule 4.6(c)(ii)(C) of the Disclosure
Letter, to the Knowledge of Borrower, (x) each Person who has or has had any
rights in or to Current Acquisition IP or any trade secrets owned, co-owned or
licensed by any Credit Party or any of its Subsidiaries, including each inventor
named on the Patents within such Current Acquisition IP, has executed an
agreement assigning his, her or its entire right, title and interest in and to
such Current Acquisition IP or trade secrets (as applicable), and the
inventions, improvements, ideas, discoveries, writings, works of authorship,
information and other intellectual property embodied, described or claimed
therein, to the stated owner(s) or licensor thereof, and (y) no such Person has
any contractual or other obligation that would preclude or conflict with such
assignment or the exploitation of any Product in the Territory or entitle such
Person to ongoing payments. Immediately after giving effect to the acquisition
of the Current Acquisition IP pursuant to the Acquisition Agreement, except for
Permitted Licenses and as set forth on Schedule 4.6(c)(ii)(D) of the Disclosure
Letter, no Person other than a Credit Party will have any right under the
Current Acquisition IP Agreements to commercialize an Acquisition Product in the
Territory; and

 

13

 

 

(iii)          Except as set forth on Schedule 4.6(c)(iii), to the Knowledge of
Borrower, there are no published Patents, Patent applications, articles or prior
art references that could reasonably be expected to materially adversely affect
the exploitation of any Product in the Territory.

 

(d)           (i)            (A) Each Credit Party or any of its Subsidiaries
possesses valid title to the Current Company IP for which it is listed as the
owner or co-owner on Schedule 4.6(c)(i)(A) of the Disclosure Letter, and
(B) there are no Liens on any Current Company IP, other than Permitted Liens;
and

 

(ii)           Immediately after giving effect to the acquisition of the Current
Acquisition IP pursuant to the Acquisition Agreement, to the Knowledge of
Borrower, each Credit Party or any of its Subsidiaries possesses valid title to
the Current Acquisition IP for which it is listed as the owner or co-owner on
Schedule 4.6(c)(ii)(A) of the Disclosure Letter, and (B) there are no Liens on
any Current Acquisition IP, other than Permitted Liens.

 

(e)           (i)            There are no maintenance, annuity or renewal fees
that are currently overdue beyond their allotted grace period for any of the
Current Company IP which is owned or co-owned by or exclusively licensed to any
Credit Party or any of its Subsidiaries, except as could not reasonably be
expected to have a materially adverse impact on such Credit Party’s or
Subsidiary’s rights to such Current Company IP, nor have any applications or
registrations therefor lapsed or become abandoned, been cancelled or expired.
There are no maintenance, annuity or renewal fees that are currently overdue
beyond their allotted grace period for any of the Current Company IP which is
non-exclusively licensed to any Credit Party or any of its Subsidiaries, except
as could not reasonably be expected to have a materially adverse impact on such
Credit Party’s or Subsidiary’s rights to such Current Company IP; and

 

14

 

 

(ii)           Immediately after giving effect to the acquisition of the Current
Acquisition IP pursuant to the Acquisition Agreement, there are no maintenance,
annuity or renewal fees that are overdue beyond their allotted grace period for
any of the Current Acquisition IP which is owned or co-owned by or exclusively
or non-exclusively licensed to any Credit Party or any of its Subsidiaries,
except, as could not reasonably be expected to have a materially adverse impact
on such Credit Party’s or Subsidiary’s rights to such Current Acquisition IP,
nor have any applications or registrations therefor lapsed or become abandoned,
been cancelled or expired.

 

(f)            (i)            There are no unpaid fees, royalties or
indemnification payments owing by Borrower or any of its Subsidiaries under any
Current Company IP Agreement that have become due, as of the Effective Date, or
are or will have become due or overdue, as of the Closing Date. As of the
Closing Date, no Current Company IP Agreement or any provision thereof (other
than provisions solely with respect to confidentiality) is or will be in full
force and effect or is or will be binding on or enforceable against Borrower or
any of its Subsidiaries in accordance with its terms (except for confidentiality
terms); and

 

(ii)           There are no unpaid fees or royalties under any Current
Acquisition IP Agreement that have become due, or are reasonably expected to
become overdue. Each Current Acquisition IP Agreement is in full force and
effect and is legal, valid, binding and enforceable in accordance with its
terms, except as may be limited by bankruptcy, insolvency, reorganization,
moratorium or similar laws relating to or limiting creditors’ rights generally
or by equitable principles relating to enforceability. Immediately after giving
effect to the acquisition of the Current Acquisition IP Agreements pursuant to
the Acquisition Agreement, except as set forth on Schedule 4.6(f)(ii) of the
Disclosure Letter, neither Borrower nor any of its Subsidiaries, as applicable,
is in breach of or default under any Current Acquisition IP Agreement to which
it is a party or may otherwise be bound and no circumstances or grounds exist
that would give rise to a claim of breach or right of rescission, termination,
non-renewal, revision or amendment of any Current Acquisition IP Agreement,
including the execution, delivery and performance of the Acquisition Agreement,
this Agreement and the other Loan Documents.

 

(g)           No payments by any Credit Party or any of its Subsidiaries are due
to any other Person in respect of the Current Company IP, other than pursuant to
any Current Company IP Agreement and those fees payable to patent offices in
connection with the prosecution and maintenance of the Current Company IP
(including any associated attorney fees). To the Knowledge of Borrower, no
payments by any Credit Party or any of its Subsidiaries are due to any other
Person in respect of the Current Acquisition IP, other than pursuant to any
Current Acquisition IP Agreements and those fees payable to patent offices in
connection with the prosecution and maintenance of the Current Acquisition IP
(including any associated attorney fees).

 

(h)           (i)           No Credit Party or any of its Subsidiaries has
undertaken or omitted to undertake any acts, and, to the Knowledge of Borrower,
no circumstance or grounds exist, that would invalidate or reduce, in whole or
in part, any enforceability or scope of (A) the Current Company IP in any manner
that could reasonably be expected to materially adversely affect the
exploitation of any Product in the Territory, or (B) in the case of Current
Company IP owned or co-owned by, or exclusively or non-exclusively licensed to,
any Credit Party or any of its Subsidiaries, other than with respect to
Permitted Licenses and except as set forth on Schedule 4.6(h)(i) of the
Disclosure Letter, a Credit Party’s or Subsidiary’s entitlement to own or
license and exploit such Current Company IP in any manner that could reasonably
be expected to materially adversely affect the exploitation of any Product in
the Territory; and

 

(ii)            Immediately after giving effect to the acquisition of the
Current Acquisition IP pursuant to the Acquisition Agreement, no Credit Party or
any of its Subsidiaries has undertaken or omitted to undertake any acts, and, to
the Knowledge of Borrower, no circumstance or grounds exist, that would
invalidate or reduce, in whole or in part, any enforceability or scope of (A)
the Current Acquisition IP in any manner that could reasonably be expected to
materially adversely affect the exploitation of any Product in the Territory,
(B) in the case of Current Acquisition IP owned or co-owned by, or exclusively
or non-exclusively licensed to, any Credit Party or any of its Subsidiaries,
other than with respect to Permitted Licenses and except as set forth on
Schedule 4.6(h)(ii) of the Disclosure Letter, a Credit Party’s or Subsidiary’s
entitlement to own or license and exploit such Current Acquisition IP.

 

15

 

 

(i)            Except as set forth on Schedule 4.6(i) of the Disclosure Letter,
to the Knowledge of Borrower, there is no product or other technology of any
third party that could reasonably be expected to infringe a Patent within the
Current Company IP or the Current Acquisition IP in a manner that would result
in a material adverse effect on any Product in the Territory.

 

(j)            Except as described on Schedule 4.6(j) of the Disclosure Letter,
no Credit Party is a party to or bound by (and, immediately after giving effect
to the consummation of the transactions contemplated by the Acquisition
Agreement, is or shall be a party to or is or shall be bound by) any Excluded
License or any Restricted License.

 

(k)           (i)            In each case where an issued Patent within the
Current Company IP is owned or co-owned by any Credit Party or any of its
Subsidiaries by assignment, the assignment has been duly recorded with the U.S.
Patent and Trademark Office; and

 

(ii)           Immediately after giving effect to the acquisition of the Current
Acquisition IP pursuant to the Acquisition Agreement, in each case where an
issued Patent within the Current Acquisition IP is owned or co-owned by any
Credit Party or any of its Subsidiaries by assignment, to the Knowledge of
Borrower, the assignment has been duly recorded with the U.S. Patent and
Trademark Office.

 

(l)            [Reserved].

 

(m)          Except as set forth on Schedule 4.6(m) of the Disclosure Letter,
the manufacture, production, use, commercialization, marketing, importing,
storage, transport, offer for sale, distribution or sale of any Product in the
Territory, does not and will not, to the Knowledge of Borrower, infringe or
violate (or in the past infringed or violated), or form a reasonable basis for a
claim of infringement or violation of, any of the rights of any third parties in
or to any issued or registered Intellectual Property (“Third Party IP”) or, to
the Knowledge of Borrower, constitutes a misappropriation of (or in the past
constituted a misappropriation of) any Third Party IP.

 

(n)           Except as set forth on Schedule 4.6(n) of the Disclosure Letter,
there are no settlements, covenants not to sue, consents, judgments, orders or
similar obligations which (i) restrict the rights of any Credit Party or any of
its Subsidiaries to use any Current Company IP or, to the Knowledge of Borrower,
any Acquisition IP to the research, development, manufacture, production, use,
commercialization, marketing, importing, storage, transport, offer for sale,
distribution or sale of any Product in the Territory (in order to accommodate
any Third Party IP or otherwise), or (ii) permit any third parties to use any
Current Company IP or, to the Knowledge of Borrower, any Acquisition IP.

 

(o)           Except as set forth on Schedule 4.6(o) of the Disclosure Letter,
(i) there is no, nor has there been any, infringement or violation by any Person
of any of the Current Company IP or the rights therein or, to the Knowledge of
Borrower, any of the Current Acquisition IP or the rights therein, and (ii)
there is no, nor has there been any, misappropriation by any Person of any of
the Current Company IP or the subject matter thereof or, to the Knowledge of
Borrower, any of the Current Acquisition IP or the subject matter thereof.

 

(p)           Immediately after giving effect to the acquisition of the Current
Acquisition IP pursuant to the Acquisition Agreement, to the Knowledge of
Borrower, each Credit Party and each of its Subsidiaries has taken all
commercially reasonable measures customary in the pharmaceutical industry to
protect the confidentiality and value of all trade secrets owned by such Credit
Party or Subsidiary or used or held for use by such Credit Party or Subsidiary,
in each case, in any way relating to the research, development, manufacture,
production, use, commercialization, marketing, importing, storage, transport,
offer for sale, distribution or sale of any Product in the Territory.

 

(q)           Except as set forth on Schedule 4.6(q), to the Knowledge of
Borrower, any Product made, used or sold under the Patents within the Current
Company IP or the Current Acquisition IP has been marked with the proper patent
notice.

 

16

 

 

(r)            Except as set forth on Schedule 4.6(r) of the Disclosure Letter,
to the Knowledge of Borrower, at the time of any shipment of Product in the
Territory occurring prior to the Effective Date, the units thereof so shipped
complied with their relevant specifications and were developed and manufactured
in all material respects in accordance with current FDA Good Manufacturing
Practices, FDA Good Clinical Practices and FDA Good Laboratory Practices (as
applicable).

 

(s)           The Collateral Documents create in favor of the Collateral Agent,
for the benefit of Lenders and the other Secured Parties, a valid and, upon the
making of the filings and the taking of the actions required under the terms of
the Loan Documents (except to the extent not required to be perfected pursuant
to the terms of the Loan Documents), perfected Lien on and security interest in
the Collateral (in each case, solely to the extent perfection is available under
applicable Law through the making of such filings and taking of such actions),
securing the payment of the Obligations, and having priority over all other
Liens on and security interests in the Collateral (except Permitted Liens).

 

4.7.          Adverse Proceedings; Specified Disputes; Compliance with Laws.

 

(a)           Except as has been disclosed in the Exchange Act Documents or as
set forth on Schedule 4.7(a) of the Disclosure Letter, both before and
immediately after giving effect to the consummation of the transactions
contemplated by the Acquisition Agreement, there are no Adverse Proceedings
pending or, to the Knowledge of Borrower, threatened in writing, at law, in
equity, in arbitration or before any Governmental Authority, by or against
Borrower or any of its Subsidiaries or against any of their respective assets or
properties or revenues (including involving allegations of sexual harassment or
misconduct by any officer of Borrower or any of its Subsidiaries) that, either
individually or in the aggregate, could reasonably be expected to materially
adversely affect the Collateral (including by imposing a Lien thereon) or result
in a Material Adverse Change;

 

(b)           Except as has been disclosed in the Exchange Act Documents or as
set forth on Schedule 4.7(b) of the Disclosure Letter: (i) there is no pending,
decided or settled opposition, interference proceeding, reissue proceeding,
reexamination proceeding, inter-partes review proceeding, post grant review
proceeding, cancellation proceeding, injunction, litigation, paragraph IV patent
certification or lawsuit under the Hatch-Waxman Act, hearing, investigation,
complaint, arbitration, mediation, demand, International Trade Commission
investigation or decree, or any other dispute, disagreement or claim, alleged in
writing to Borrower or any of its Subsidiaries (collectively referred to
hereinafter as “Specified Disputes”), nor has any Specified Dispute been
threatened in writing, challenging the legality, validity, enforceability or
ownership of any Current Company IP; and (ii) to the Knowledge of Borrower,
there is no pending, decided or settled Specified Dispute, nor has any Specified
Dispute been threatened in writing, challenging the legality, validity,
enforceability or ownership of any Current Acquisition IP; and

 

(c)           Neither Borrower nor any of its Subsidiaries (i) is in violation
of any Requirements of Law (including Environmental Laws), except for such
violations that, individually or in the aggregate, could not reasonably be
expected to result in a Material Adverse Change, or (ii) is subject to or in
default with respect to any final judgments, orders, writs, injunctions,
decrees, rules or regulations of any court or any federal, state, municipal or
other governmental department, commission, board, bureau, agency or
instrumentality, domestic or foreign, that, individually or in the aggregate,
could reasonably be expected to materially adversely affect the Collateral
(including by imposing a Lien thereon) or result in a Material Adverse Change.

 

4.8.         Exchange Act Documents; Financial Statements; Financial Condition;
No Material Adverse Change; Books and Records.

 

(a)           The documents filed by Borrower with the SEC pursuant to the
Exchange Act since January 1, 2019 (the “Exchange Act Documents”), when they
were filed with the SEC, conformed in all material respects to the requirements
of the Exchange Act, and as of the time they were filed with the SEC, none of
such documents contained any untrue statement of a material fact or omitted to
state a material fact necessary to make the statements therein (excluding any
projections and forward-looking statements, estimates, budgets and general
economic or industry data of a general nature), in the light of the
circumstances under which they were made, not misleading; provided, that, with
respect to projected financial information, Borrower represents only that such
information was prepared in good faith based upon assumptions believed to be
reasonable at the time (it being understood that such projections are not a
guarantee of financial performance and are subject to uncertainties and
contingencies, many of which are beyond the control of Borrower or any
Subsidiary, and neither Borrower nor any Subsidiary can give any assurance that
such projections will be attained, that actual results may differ in a material
manner from such projections and any failure to meet such projections shall not
be deemed to be a breach of any representation or covenant herein);

 

17

 

 

(b)           The financial statements (including the related notes thereto) of
Borrower and its Subsidiaries included in the Exchange Act Documents present
fairly in all material respects the consolidated financial condition of Borrower
and such Subsidiaries and their consolidated results of operations as of the
dates indicated and the results of their operations and the changes in their
cash flows for the periods specified. Such financial statements have been
prepared in conformity with Applicable Accounting Standards applied on a
consistent basis throughout the periods covered thereby, except as otherwise
disclosed therein and, in the case of unaudited, interim financial statements,
subject to normal year-end audit adjustments and the exclusion of certain
footnotes, and any supporting schedules included in the Exchange Act Documents
present fairly in all material respects the information required to be stated
therein (subject to the proviso in Section 4.8(a) above with respect to
projections);

 

(c)           Since December 31, 2018, there has not occurred or failed to occur
any change or event that has had or could reasonably be expected to have, either
alone or in conjunction with any other change(s), event(s) or failure(s), a
Material Adverse Change, except as has been disclosed in the Exchange Act
Documents; and

 

(d)           The Books of Borrower and each of its Subsidiaries in existence
immediately prior to the Closing Date contain full, true and correct entries of
all dealings and transactions in relation to its business and activities in
conformity with Applicable Accounting Standards and all Requirements of Law.

 

4.9.          Solvency. Borrower and its Subsidiaries, on a consolidated basis,
are Solvent. Without limiting the generality of the foregoing, there has been no
proposal made or resolution adopted by any competent corporate body for the
dissolution or liquidation of Borrower, nor do any circumstances exist which may
result in the dissolution or liquidation of Borrower.

 

4.10.       Payment of Taxes. All foreign, U.S. federal and state income and
other material Tax returns and reports (or extensions thereof) of each Credit
Party and each of its Subsidiaries required to be filed by any of them have been
timely filed and are correct in all material respects, and all material Taxes
which are due and payable by any Credit Party or any of its Subsidiaries and all
material assessments, fees and other governmental charges upon any Credit Party
or any of its Subsidiaries and upon their respective properties, assets, income,
businesses and franchises which are due and payable have been paid when due and
payable except where the validity or amount thereof is being contested in good
faith by appropriate proceedings; provided that (a) the applicable Credit Party
has set aside on its books adequate reserves therefor in conformity with
Applicable Accounting Standards and (b) the failure to pay such Taxes,
individually or in the aggregate, could not reasonably be expected to result in
a Material Adverse Change.

 

4.11.       Environmental Matters. Neither Borrower nor any of its Subsidiaries
nor any of their respective Facilities or operations is subject to any
outstanding written order, consent decree or settlement agreement with any
Person relating to any Environmental Law, any Environmental Claim, or any
Hazardous Materials Activity that, individually or in the aggregate, could
reasonably be expected to result in a Material Adverse Change. There are and, to
the Knowledge of Borrower, have been, no conditions, occurrences, or Hazardous
Materials Activities that would reasonably be expected to form the basis of an
Environmental Claim against Borrower or any of its Subsidiaries that,
individually or in the aggregate, could reasonably be expected to result in a
Material Adverse Change. To the Knowledge of Borrower, no predecessor of
Borrower or any of its Subsidiaries has filed any notice under any Environmental
Law indicating past or present treatment of Hazardous Materials at any Facility,
which would reasonably be expected to form the basis of an Environmental Claim
against Borrower or any of its Subsidiaries that, individually or in the
aggregate, could reasonably be expected to result in a Material Adverse Change
(but, for the avoidance of doubt, Borrower has not undertaken any investigation
of or made any inquiries to, or relating to, any of its or its Subsidiaries’
predecessors), and neither Borrower’s nor any of its Subsidiaries’ operations
involves the generation, transportation, treatment, storage or disposal of
hazardous waste, as defined under 40 C.F.R. Parts 260 270 or any state
equivalent, which would reasonably be expected to form the basis of an
Environmental Claim against Borrower or any of its Subsidiaries that,
individually or in the aggregate, could reasonably be expected to result in a
Material Adverse Change. No event or condition has occurred or is occurring with
respect to any Credit Party relating to any Environmental Law, any Release of
Hazardous Materials or any Hazardous Materials Activity that, individually or in
the aggregate, has resulted in, or could reasonably be expected to result in, a
Material Adverse Change.

 

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4.12.       Material Contracts. After giving effect to the consummation of the
transactions contemplated by this Agreement, except as described on Schedule
4.12 of the Disclosure Letter, each Material Contract is a valid and binding
obligation of the applicable Credit Party and, to the Knowledge of Borrower,
each other party thereto, and is in full force and effect, and neither the
applicable Credit Party nor, to the Knowledge of Borrower, any other party
thereto is in material breach thereof or default thereunder, except where such
breach or default (which default has not been cured or waived) could not
reasonably be expected to give rise to any right of the applicable counterparty
thereto to accelerate such Credit Party’s or Subsidiary’s obligations thereunder
or cancel or terminate such Material Contract or any provision thereof or result
in the cancellation, termination or invalidation of such Material Contract or
any provision thereof. Except as described on Schedule 4.12 of the Disclosure
Letter, no Credit Party or any of its Subsidiaries has received any written
notice from any party thereto asserting or, to the Knowledge of Borrower
threatening to assert, circumstances that could reasonably be expected to result
in the cancellation, termination or invalidation of any Material Contract (or
any material provision thereof) or the acceleration of such Credit Party’s or
Subsidiary’s obligations thereunder.

 

4.13.       Regulatory Compliance.

 

(a)           No Credit Party is or is required to be registered as an
“investment company” under the Investment Company Act of 1940. Each Credit Party
has complied in all material respects with the Federal Fair Labor Standards
Act.(b)Except as could not, either individually or in the aggregate, reasonably
be expected to result in a Material Adverse Change, each Plan is in compliance
with the applicable provisions of ERISA, the IRC and other U.S. federal or state
Requirements of Law, respectively.

 

(c)           (i) No ERISA Event has occurred or is reasonably expected to
occur; (ii) neither any Credit Party nor any ERISA Affiliate has incurred, or
reasonably expects to incur, any liability (and no event has occurred which,
with the giving of notice under Section 4219 of ERISA, would result in such
liability) under Section 4201 et seq. or 4243 of ERISA with respect to a
Multiemployer Plan; and (iii) neither any Credit Party nor any ERISA Affiliate
has engaged in a transaction that would be subject to Section 4069 or 4212(c) of
ERISA, except, with respect to each of clauses (i), (ii) and (iii) above, as
could not reasonably be expected, individually or in the aggregate, to result in
a Material Adverse Change.

 

4.14.       Margin Stock. Neither Borrower nor any of its Subsidiaries is
engaged or will engage, principally or as one of its important activities, in
the business of purchasing or carrying Margin Stock (within the meaning of
Regulation U of the Federal Reserve Board) or extending credit for the purpose
of purchasing or carrying Margin Stock. No Credit Party owns any Margin Stock.
Neither Borrower nor any of its Subsidiaries has taken or permitted to be taken
any action that might cause any Loan Document to violate Regulation T, U or X of
the Federal Reserve Board.

 

4.15.       Subsidiaries. Schedule 4.15 of the Disclosure Letter (a) sets forth
the name and jurisdiction of incorporation, organization or formation of
Borrower and each of its Subsidiaries and (b) sets forth the ownership interest
of Borrower and any other Credit Party in each of their respective Subsidiaries,
including the percentage of such ownership.

 

4.16.       Employee Matters. Neither Borrower nor any of its Subsidiaries is
engaged in any unfair labor practice that could reasonably be expected to result
in a Material Adverse Change. There is (a) no unfair labor practice complaint
pending against Borrower or any of its Subsidiaries or, to the Knowledge of
Borrower, threatened in writing against any of them before the National Labor
Relations Board, and no grievance or arbitration proceeding arising out of or
under any collective bargaining agreement that is pending against Borrower or
any of its Subsidiaries or, to the Knowledge of Borrower, threatened in writing
against any of them, (b) no strike or work stoppage in existence or, to the
Knowledge of Borrower, threatened in writing involving Borrower or any of its
Subsidiaries, and (c) to the Knowledge of Borrower, no union representation
question existing with respect to the employees of Borrower or any of its
Subsidiaries and, to the Knowledge of Borrower, no union organization activity
that is taking place that, in each case specified in clauses (a), (b) and (c)
above, individually or taken together with any other case therein specified,
could reasonably be expected to result in a Material Adverse Change.

 

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4.17.           Full Disclosure. None of the documents, certificates or written
statements (excluding any projections and forward-looking statements, estimates,
budgets and general economic or industry data of a general nature) furnished or
otherwise made available to the Collateral Agent or any Lender by or on behalf
of any Credit Party for use in connection with the transactions contemplated
hereby (as may be modified or supplemented by other information so furnished
promptly after the same becomes available) contains any untrue statement of a
material fact or omits to state a material fact necessary in order to make the
statements contained herein or therein, as of the time when made or delivered,
not misleading in light of the circumstances in which the same were made;
provided, that, with respect to projected financial information, Borrower
represents only that such information was prepared in good faith based upon
assumptions believed to be reasonable at the time (it being understood that such
projections are not a guarantee of financial performance and are subject to
uncertainties and contingencies, many of which are beyond the control of
Borrower or any Subsidiary, and neither Borrower nor any Subsidiary can give any
assurance that such projections will be attained, that actual results may differ
in a material manner from such projections and any failure to meet such
projections shall not be deemed to be a breach of any representation or covenant
herein). To the Knowledge of Borrower, there are no facts (other than matters of
a general economic or industry nature) that, individually or in the aggregate,
could reasonably be expected to result in a Material Adverse Change and that
have not been disclosed herein or in such other documents, certificates and
written statements furnished or made available to the Collateral Agent or any
Lender for use in connection with the transactions contemplated hereby.

 

4.18.           FCPA; Patriot Act; OFAC; Export and Import Laws.

 

(a)                 None of Borrower, its Subsidiaries or, to the Knowledge of
Borrower, any director, officer, agent or employee of Borrower or any Subsidiary
of Borrower has (i) used any corporate funds of Borrower or any of its
Subsidiaries for any unlawful contribution, gift, entertainment or other
unlawful expense relating to political activity, (ii) made any direct or
indirect unlawful payment to any foreign or domestic government official or
employee or any other Person from corporate funds of Borrower or any of its
Subsidiaries, (iii) violated or is in violation of any provision of the U.S.
Foreign Corrupt Practices Act of 1977 (the “FCPA”) or the U.K. Bribery Act
(“UKBA”) or (iv) made any bribe, rebate, payoff, influence payment, kickback or
other unlawful payment;

 

(b)                (i) The operations of Borrower and its Subsidiaries are and
have been conducted at all times in compliance with applicable financial
recordkeeping and reporting requirements of the Currency and Foreign
Transactions Reporting Act of 1970, the Bank Secrecy Act of 1970 (as amended by
Title III of the Uniting and Strengthening America by Providing Appropriate
Tools Required to Intercept and Obstruct Terrorism (USA PATRIOT) Act of 2001)
and the anti-money laundering laws, rules and regulations of each jurisdiction
(foreign or domestic) in which Borrower or any of its Subsidiaries is subject to
such jurisdiction’s Requirements of Law (collectively, the “Anti-Money
Laundering Laws”) and (ii) no action, suit or proceeding by or before any
Governmental Authority or any arbitrator involving Borrower or any of its
Subsidiaries with respect to the Anti-Money Laundering Laws is pending or to the
Knowledge of Borrower, threatened in writing;

 

(c)                 None of Borrower, its Subsidiaries or, to the Knowledge of
Borrower, any director, officer, agent or employee of Borrower or any Subsidiary
of Borrower is, or is owned or controlled by any Persons which are, the target
or the subject of any sanctions administered and enforced by the Office of
Foreign Assets Control of the U.S. Department of the Treasury (“OFAC”), the U.S.
Department of State, the United Nations Security Council, the European Union,
Her Majesty’s Treasury or any other relevant sanctions authority (collectively
“Sanctions”);

 

(d)                Borrower will not, directly or, to the Knowledge of Borrower,
indirectly through an agent, use any of the proceeds of the Credit Extension, or
lend, contribute or otherwise make available such proceeds of the Credit
Extensions to any Subsidiary, joint venture partner or other Person, (i) for any
payments to any governmental official or employee, political party, official of
a political party, candidate for political office or anyone else acting in an
official capacity, in order to obtain, retain or direct business, or to obtain
any improper advantage, in violation of the FCPA, UKBA or any other applicable
anti-corruption laws, (ii) in violation of any Anti-Money Laundering Laws, or
(iii) for the purpose of financing the activities of any Person that is the
target or the subject of Sanctions or in any country or territory that at the
time of such funding, is the subject of Sanctions; and

 

(e)                 Borrower and its Subsidiaries are in compliance, in all
material respects, with applicable Export and Import Laws.

 

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4.19.           Health Care Matters

 

(a)                 Compliance with Health Care Laws. Except as set forth on
Schedule 4.19(a) of the Disclosure Letter, each Credit Party and, to the
Knowledge of Borrower, each of its Subsidiaries and each officer, Affiliate, and
employee acting on behalf of such Credit Party or any of its Subsidiaries, is in
compliance in all material respects with all Health Care Laws.

 

(b)                Compliance with FDA Laws. Each Credit Party and, to the
Knowledge of Borrower, each of its Subsidiaries, are in compliance in all
material respects with all applicable FDA Laws, including the Federal Food Drug
and Cosmetic Act (21 U.S.C. § 301 et seq.) and the regulations promulgated
thereunder (the “FDCA”), in any way relating to any research, development,
manufacture, production, use, commercialization, marketing, importing, storage,
record keeping, reporting, transport, offer for sale, distribution or sale of
any Product in the Territory. Each Product distributed or sold in the Territory
at any and all times during the past five (5) years (or, with respect to the
Acquisition Products, during the time such Products have actually been
distributed or sold by the Borrower) has been manufactured, developed and tested
in all material respects in accordance with current FDA Good Manufacturing
Practices, FDA Good Clinical Practices and FDA Good Laboratory Practices (as
applicable) and, if and to the extent such Product is required to be approved or
cleared by the FDA pursuant to the FDCA in order to be legally marketed in the
United States for such Product’s intended uses, such Product has been approved
or cleared for such intended uses. To the Knowledge of Borrower, no Product that
is or has been manufactured, tested, distributed, held or marketed by or on
behalf of any Credit Party or any of its Subsidiaries has been adulterated or
misbranded.

 

(c)                 Compliance with DEA Laws. Each Credit Party and, to the
Knowledge of Borrower, each of its Subsidiaries, is in compliance in all
material respects with all applicable DEA Laws, including the Controlled
Substances Act (21 U.S.C. § 801 et seq.) and the regulations promulgated
thereunder (the “CSA”), in any way relating to any development, manufacture,
production, use, commercialization, marketing, importing, storage, record
keeping, reporting, transport, offer for sale, distribution or sale of any
Product in the Territory. Each Product distributed or sold in the Territory at
any and all times during the past five (5) years or, with respect to the
Acquisition Products, during the time such Products have actually been
distributed or sold by the Borrower) has been (i) stored, transported, imported,
offered for sale, documented, secured, and distributed in all material respects
in accordance with DEA Laws and any state laws and regulations applicable to
controlled substances, and (ii) to the extent such Product is required to be
authorized by the DEA pursuant to the CSA, such Product has been so authorized,
and no inquiries regarding material issues have been initiated by the DEA.

 

(d)                Material Statements. Within the past five (5) years, neither
any Credit Party, nor, to the Knowledge of Borrower, any Subsidiary or any
officer, Affiliate or employee of any Credit Party or Subsidiary in its capacity
as a Subsidiary or as an officer, Affiliate or employee of a Credit Party or
Subsidiary (as applicable), nor, to the Knowledge of Borrower, any agent of any
Credit Party or Subsidiary, (i) has made an untrue statement of a material fact
or a fraudulent statement to any Governmental Authority, (ii) has failed to
disclose a material fact to any Governmental Authority, or (iii) has otherwise
committed an act, made a statement or failed to make a statement that, in the
case of clauses (i) through (iii) above, at the time such statement or
disclosure was made (or, in the case of such failure, should have been made) or
such act was committed, would reasonably be expected to constitute a material
violation of any applicable Requirements of Law or could invoke the FDA
Application Integrity Policy regarding “Fraud, Untrue Statements of Material
Facts, Bribery and Illegal Gratuities,” set forth in FDA’s Compliance Policy
Guide Sec. 120.100 or any similar policy, in each case as related to any
Product.

 

(e)                 Proceedings; Audits. Except as has been disclosed in the
Exchange Act Documents or as set forth on Schedule 4.19(e) of the Disclosure
Letter: (i) there is no Adverse Proceeding pending or, to the Knowledge of
Borrower, threatened in writing, against any Credit Party or any of its
Subsidiaries relating to any allegations of non-compliance with any Health Care
Laws, Data Protection Laws, FDA Laws, DEA Laws or other Requirements of Law;
(ii) to the Knowledge of Borrower, there are no facts, circumstances or
conditions that, individually or in the aggregate, could reasonably be expected
to form the basis for any such Adverse Proceeding; and (iii) there are no
Governmental Authority investigations or inquiries (other than routine audits),
suits, claims, actions or proceedings pending or, to the Knowledge of Borrower,
threatened, against any Credit Party or any of its Subsidiaries with respect to
any of the Products or alleging any violation of any such Health Care Law, FDA
Law, DEA Law or other applicable Requirements of Law.

 

21

 

 

(f)                  Safety Notices. Neither any Credit Party nor any of its
Subsidiaries has initiated or otherwise engaged in, either voluntarily or at the
request of the FDA or any other Regulatory Agency, any recalls, product
suspensions or discontinuations, field notifications, field corrections, safety
warnings, “dear doctor” letters, investigator notices, safety alerts or other
similar notices of action, including as a result of any Risk Evaluation and
Mitigation Strategy proposed or required by the FDA, relating to an alleged lack
of safety, efficacy or regulatory compliance of any Product (a “Safety Notice”).
Neither any Credit Party nor any of its Subsidiaries has received any notice
from the FDA or any other Regulatory Agency that such Regulatory Agency has (i)
commenced or may initiate any action to withdraw approval of, place sales or
marketing restrictions on, request the recall of, or seek a Safety Notice
regarding, any of the Products, or (ii) commenced or may initiate any action to
enjoin or place restrictions on the manufacture or production of any of the
Products. Each Credit Party and each of its Subsidiaries has filed all annual
and periodic reports, amendments and safety reports for any Product required to
be made by it to any Regulatory Agency.

 

(g)                Preclinical Studies / Clinical Trials. All pre-clinical and
clinical studies relating to any of the Products conducted by or on behalf of
any Credit Party or any of its Subsidiaries have been, or are being, conducted
in compliance with all applicable Requirements of Law, including the
requirements of the FDA’s Good Laboratory Practice and Good Clinical Practice
requirements, including regulations under 21 C.F.R. Parts 50, 54, 56, 58 and
312, the Animal Welfare Act and applicable experimental protocols, procedures
and controls. No clinical trial conducted by or on behalf of any Credit Party or
any of its Subsidiaries has been terminated or suspended by any Regulatory
Authority and neither any Credit Party nor any of its Subsidiaries has received
any notice that the FDA, any other Governmental Authority or any institutional
review board, ethics committee or safety monitoring committee has recommended,
initiated or threatened to initiate any action to suspend or terminate any
clinical trial conducted by or on behalf of any Credit Party or any of its
Subsidiaries or to otherwise restrict the preclinical research on or clinical
study of any Product. Neither any Credit Party nor any of its Subsidiaries has a
reasonable expectation that there are grounds for imposition of a clinical hold,
as described in 21 C.F.R. § 312.42.

 

(h)                Advertising / Promotion. Each Credit Party and, to the
Knowledge of Borrower, each of its Subsidiaries, officers, employees and agents
has advertised, promoted, marketed and distributed each of the Products in
compliance in all material respects with FDA Laws and other Requirements of Law.
Except as set forth on Schedule 4.19(h) of the Disclosure Letter, neither any
Credit Party nor, to the Knowledge of Borrower, any of its Subsidiaries,
officers, employees or agents has received any notice of or is subject to any
civil, criminal or administrative action, suit, demand, claim, complaint,
hearing, investigation, demand letter, warning letter, untitled letter,
proceeding or request for information from the FDA or any other Governmental
Authority concerning noncompliance with any FDA Laws or other Requirements of
Law with regard to advertising, promoting, marketing or distributing any of the
Products.

 

(i)                  Recordkeeping / Reporting. Each Credit Party and, to the
Knowledge of Borrower, each of its Subsidiaries has maintained records relating
to the research, development, testing, manufacture, production, handling,
labeling, packaging, storage, supply, promotion, distribution, marketing,
commercialization, import, export and sale of each of the Products in compliance
in all material respects with FDA Laws, DEA Laws and other applicable
Requirements of Law, and each Credit Party and, to the Knowledge of Borrower,
each of its Subsidiaries has submitted to the FDA and other Governmental Bodies
in a timely manner all notices and annual or other reports required to be made
by it, including adverse experience reports and annual reports, for each of the
Products.

 

(j)                  Prohibited Transactions; No Whistleblowers. Except as set
forth on Schedule 4.19(j) of the Disclosure Letter, within the past six (6)
years, to the Knowledge of Borrower, neither any Credit Party, any Subsidiary,
any officer, Affiliate or employee of a Credit Party or Subsidiary, nor any
other Person acting on behalf of any Credit Party or any Subsidiary, directly or
indirectly: (i) has offered or paid any remuneration, in cash or in kind, to, or
made any financial arrangements with, any past, present or potential patient,
supplier, physician or contractor, in order to illegally obtain business or
payments from such Person in material violation of any Health Care Law; (ii) has
given or made, or is party to any illegal agreement to give or make, any illegal
gift or gratuitous payment of any kind, nature or description (whether in money,
property or services) to any past, present or potential patient, supplier,
physician or contractor, or any other Person in material violation of any Health
Care Law; (iii) has given or made, or is party to any agreement to give or make
on behalf of any Credit Party or any of its Subsidiaries, any contribution,
payment or gift of funds or property to, or for the private use of, any
governmental official, employee or agent where either the contribution, payment
or gift or the purpose of such contribution, payment or gift, was a material
violation of the laws of any Governmental Authority having jurisdiction over
such payment, contribution or gift; (iv) has established or maintained any
unrecorded fund or asset for any purpose or made any materially misleading,
false or artificial entries on any of its books or records for any reason; or
(v) has made, or is party to any agreement to make, any payment to any Person
with the intention or understanding that any part of such payment would be in
material violation of any Health Care Law. To the Knowledge of Borrower, there
are no actions pending or threatened (in writing) against any Credit Party or
any of its Subsidiaries or any of their respective Affiliates under any foreign,
U.S. federal or state whistleblower statute, including under the False Claims
Act of 1863 (31 U.S.C. § 3729 et seq.).

 

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(k)                Exclusion. Neither any Credit Party nor, to the Knowledge of
Borrower, any Subsidiary or any officer, Affiliate or employee having authority
to act on behalf of any Credit Party or any Subsidiary, is or, to the Knowledge
of Borrower, has been threatened in writing to be: (i) excluded from any
Governmental Payor Program pursuant to 42 U.S.C. § 1320a-7b and related
regulations; (ii) “suspended” or “debarred” from selling any products to the
U.S. government or its agencies pursuant to the Federal Acquisition Regulation
relating to debarment and suspension applicable to federal government agencies
generally (42 C.F.R. Subpart 9.4), or other U.S. Requirements of Law; (iii)
debarred, disqualified, suspended or excluded from participation in Medicare,
Medicaid or any other Governmental Payor Program or is listed on the General
Services Administration list of excluded parties; (iv) a party to any other
action or proceeding by any Governmental Authority that would prohibit the
applicable Credit Party or Subsidiary from distributing or selling any Product
in the Territory or providing any services to any governmental or other
purchaser pursuant to any Health Care Laws; (v) convicted of any crime or, to
the Knowledge of Borrower, engaged in any conduct, for which such Person could
be debarred, suspended or excluded from participating in any governmental health
care program under 42 U.S.C. § 1320a-7 and related regulations or any similar
applicable Requirement of Law or program; or (vi) debarred pursuant to 21 U.S.C.
§ 335a and related regulations.

 

(l)                  HIPAA. Each Credit Party and, to the Knowledge of Borrower,
each of its Subsidiaries, to the extent applicable, is in material compliance
with all applicable federal, state and local laws and regulations regarding the
privacy, security, and notification of breaches of health information and
regarding electronic transactions, including HIPAA, and each Credit Party and,
to the Knowledge of Borrower, each of its Subsidiaries, to the extent
applicable, has implemented policies, procedures and training customary in the
pharmaceutical industry or otherwise adequate to assure continued compliance and
to detect non-compliance. No Credit Party is a “covered entity” as defined in 45
C.F.R. § 160.103 and no Credit Party or any Subsidiary is required to comply
with the GDPR.

 

(m)               Corporate Integrity Agreement. Neither any Credit Party or
Subsidiary or any of their respective Affiliates, nor any officer, director,
managing employee or, to the Knowledge of Borrower, agent (as those terms are
defined in 42 C.F.R. § 1001.1001) of any Credit Party or Subsidiary, is a party
to or has any ongoing reporting or disclosure obligations under, or is otherwise
subject to, any corporate integrity agreement, monitoring agreement, deferred
prosecution agreement, consent decree, settlement order or other similar
agreements, or any order, in each case imposed by any U.S. Governmental
Authority, concerning compliance with any laws, rules or regulations, issued
under or in connection with a Governmental Payor Program.

 

4.20.           Regulatory Approvals.

 

(a)                 Except as set forth on Schedule 4.20(a) of the Disclosure
Letter, each Credit Party and each Subsidiary involved in any research,
development, manufacture, production, use, commercialization, marketing,
importing, storage, transport, offer for sale, distribution or sale of any
Product in the Territory has all Regulatory Approvals material to the conduct of
its business and operations. Each such Regulatory Approval is, as applicable,
(i) in full force and effect, (ii) validly registered and on file with the
applicable Regulatory Agency, in compliance in all material respects with all
filing and maintenance requirements (including any fee requirements) thereof,
and is in good standing, valid and enforceable, and (iii) no suspension,
revocation, or cancellation of such Regulatory Approval is pending or, to the
Knowledge of Borrower, threatened, and, to the Knowledge of Borrower, there is
no basis for believing that such Regulatory Approval will not be renewable upon
its expiration.

 

(b)                Each Credit Party, each Subsidiary and, to the Knowledge of
Borrower, each licensee of a Credit Party or a Subsidiary of any Intellectual
Property relating to any Product, is in compliance with, and at all times during
the past five (5) years, has complied, in all material respects, with all
applicable foreign, U.S. federal, state and local laws, rules and regulations
governing the research, development, manufacture, production, use,
commercialization, marketing, importing, distribution or sale of any Product in
the Territory, including all such regulations promulgated by each applicable
Regulatory Agency. No Credit Party or any of its Subsidiaries has received any
written notice from any Regulatory Agency alleging or citing action or inaction
by any Credit Party or any of its Subsidiaries that would constitute a violation
of any applicable foreign, U.S. federal, state or local laws, rules or
regulations, including a Warning Letter or Untitled Letter from the FDA, that
could reasonably be expected to result in a Material Adverse Change. To the
Knowledge of Borrower, there is no act, omission, event or circumstance of which
any Credit Party or any of its Subsidiaries is aware that would reasonably be
expected to give rise to or form the basis for any civil, criminal or
administrative action, suit, demand, claim, complaint, hearing, investigation,
demand letter, warning letter, untitled letter, proceeding or request for
information or any liability (whether actual or contingent) for failure to
comply with any FDA Laws, DEA Laws, Health Care Laws or other applicable
Requirements of Law. Neither any Credit Party or any of its Subsidiaries nor, to
the Knowledge of Borrower, any director, officer, employee or contractor of any
Credit Party or any of its Subsidiaries, has made any voluntary self-disclosure
to any Governmental Authority regarding any potential material non-compliance
with any applicable Requirements of Law.

 

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4.21.           Supply and Manufacturing.

 

(a)                 Except as set forth on Schedule 4.21(a) of the Disclosure
Letter, to the Knowledge of Borrower, each Product has at all times (or, in the
case of Acquisition Product, since January 9, 2018) been manufactured in
sufficient quantities and of a sufficient quality to satisfy then-current demand
of such Product in the Territory, without the occurrence of any event causing
inventory of such Product to have become exhausted prior to satisfying such
demand or any other event in which the manufacture and release to the market of
such Product in the Territory does not satisfy such demand. To the Knowledge of
Borrower, there is no event or circumstance which would reasonably be expected
to adversely affect the ability to satisfy the sales demand for such Product in
the Territory budgeted as of the Effective Date.

 

(b)                Except as disclosed in the Exchange Act Documents or set
forth on Schedule 4.21(b) of the Disclosure Letter, to the Knowledge of
Borrower, (i) no manufacturer (including a contract manufacturer) or producer of
any Product has (i) been subject to a Regulatory Agency shutdown, restriction or
import or export prohibition, or (ii) received in the past five (5) years or is
currently subject to a FDA Form 483 or other written Regulatory Agency notice of
inspectional observations, warning letter, untitled letter or request to make
changes to any Product that would reasonably be expected to impact any Product
with respect to any facility manufacturing or producing such Product for import,
distribution or sale in the Territory, and (iii) with respect to each such FDA
Form 483 received or other written Regulatory Agency notice (if any), all
scientific and technical violations or other issues relating to good
manufacturing practice requirements documented therein, and any disputes
regarding any such violations or issues, have been corrected or otherwise
resolved.

 

(c)                 Except as disclosed in Schedule 4.21(c), no Credit Party or,
to the Knowledge of Borrower, any of its Subsidiaries has received any notice,
written or oral, from any party to any Manufacturing Agreement containing any
indication by or written threat of such party to reduce or cease, in any
material respect, the supply of Product or the active pharmaceutical ingredient
incorporated therein in the Territory through calendar year 2025 (or such
earlier date in accordance with the terms and conditions of such Manufacturing
Agreement, as applicable).

 

4.22.           Cybersecurity; Data Protection.

 

(a)                 Except as set forth on Schedule 4.22(a) of the Disclosure
Letter, the information technology systems used in the business of Borrower and
its Subsidiaries operate and perform in all material respects as required to
permit Borrower and its Subsidiaries to conduct their business as presently
conducted. Except as set forth on Schedule 4.22(a) of the Disclosure Letter,
Borrower and its Subsidiaries have implemented and maintain a commercially
reasonable enterprise-wide privacy and information security program with plans,
policies and procedures for privacy, physical and cyber security, disaster
recovery, business continuity and incident response, including reasonable and
appropriate administrative, technical and physical safeguards to protect
information subject to Data Protection Laws as well as information and other
materials in which Borrower or any of its Subsidiaries have Intellectual
Property rights (including Company IP and, immediately after giving effect to
the acquisition of the Current Acquisition IP pursuant to the Acquisition
Agreement, Acquisition IP) or nondisclosure obligations, and the information
technology systems of Borrower and each of its Subsidiaries, from any
unauthorized access, use, control, disclosure, destruction or modification.
Except as set forth on Schedule 4.22(a) of the Disclosure Letter, neither
Borrower nor any of its Subsidiaries, nor to the Knowledge of Borrower, any
vendor of Borrower or any of its Subsidiaries, has suffered any data breaches or
other incidents that (i) have resulted in any unauthorized access, acquisition,
use, control, disclosure, destruction, or modification of any information
subject to Data Protection Laws, any information or other materials subject to
non-disclosure obligations or any material Company IP or Current Acquisition IP,
or (ii) have resulted in unauthorized access to, control of, or disruption of
the information technology systems of Borrower or any of its Subsidiaries.
Borrower and each of its Subsidiaries is in material compliance with the
requirements of (A) their respective enterprise-wide privacy and information
security programs, (B) applicable Data Protection Laws, (C) all Material
Contracts regarding the privacy and security of customer, consumer, patient,
employee and other personal data, (D) all contractual non-disclosure obligations
and (E) their respective published privacy policies. In the past six (6) years,
there have not been any third party claims related to, any loss, theft,
unauthorized access to, or unauthorized acquisition, modification, disclosure,
corruption, destruction, or other misuse of any information subject to Data
Protection Laws (including any ransomware incident) that Borrower or any of its
Subsidiaries creates, receives, maintains, or transmits.

 

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(b)                In the past six (6) years, neither Borrower nor any of its
Subsidiaries has received any written notice of any claims, investigations
(including investigations by any Governmental Authority), or alleged violations
relating to any information subject to Data Protection Laws created, received,
maintained or transmitted by Borrower or any of its Subsidiaries.

 

4.23.           Additional Representations and Warranties.

 

(a)                 After giving effect to the Term Loans, there is no
Indebtedness other than the Permitted Indebtedness described in clauses (a),
(b), (m), (o), (q) or (s) of the definition of “Permitted Indebtedness”.

 

(b)                There are no Hedging Agreements.

 

5.                   AFFIRMATIVE COVENANTS

 

Each Credit Party covenants and agrees that, until payment in full of all
Obligations (other than inchoate indemnity obligations), each Credit Party
shall, and shall cause each of its Subsidiaries to:

 

5.1.              Maintenance of Existence. (a) Preserve, renew and maintain in
full force and effect its and all its Subsidiaries’ legal existence under the
Requirements of Law in their respective jurisdictions of organization,
incorporation or formation; (b) take all commercially reasonable action to
maintain all rights, privileges (including its good standing), permits, licenses
and franchises necessary or desirable for it and all of its Subsidiaries in the
ordinary course of its business, except in the case of clause (a) (other than
with respect to Borrower) and clause (b) above, (i) to the extent that failure
to do so could not reasonably be expected to result in a Material Adverse Change
or (ii) pursuant to a transaction permitted by this Agreement; and (c) comply
with all Requirements of Law of any Governmental Authority to which it is
subject, except where the failure to do so could not reasonably be expected to
result, individually or in the aggregate, in a Material Adverse Change.

 

5.2.              Financial Statements, Notices. Deliver to the Collateral
Agent:

 

(a)                 Financial Statements.

 

(i)                  Annual Financial Statements. As soon as available, but in
any event within ninety (90) days after the end of each fiscal year of Borrower
(or such earlier date on which Borrower is required to file a Form 10-K under
the Exchange Act, as applicable), beginning with the fiscal year ending December
31, 2019, a consolidated balance sheet of Borrower and its Subsidiaries as of
the end of such fiscal year, and the related consolidated statements of income,
cash flows and stockholders’ equity for such fiscal year, setting forth in
comparative form the figures for the previous fiscal year, all prepared in
accordance with Applicable Accounting Standards, with such consolidated
financial statements to be audited and accompanied by (x) a report and opinion
of Borrower’s independent certified public accounting firm of recognized
national standing (which report and opinion shall be prepared in accordance with
Applicable Accounting Standards and shall not be subject to any qualification as
to “going concern” or scope of audit), stating that such financial statements
fairly present, in all material respects, the consolidated financial condition,
results of operations and cash flows of Borrower and its Subsidiaries as of the
dates and for the periods specified in accordance with Applicable Accounting
Standards, and (y) if and only if Borrower is required to comply with the
internal control provisions pursuant to Section 404 of the Sarbanes-Oxley Act of
2002 requiring an attestation report of such independent certified public
accounting firm, an attestation report of such independent certified public
accounting firm as to Borrower’s internal controls pursuant to Section 404 of
the Sarbanes-Oxley Act of 2002 attesting to management’s assessment that such
internal controls meet the requirements of the Sarbanes-Oxley Act of 2002;
provided, however, that Borrower shall be deemed to have made such delivery of
such consolidated financial statements if such consolidated financial statements
shall have been made available within the time period specified above on the
SEC’s EDGAR system (or any successor system adopted by the SEC);

 

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(ii)                Quarterly Financial Statements. As soon as available, but in
any event within forty-five (45) days after the end of each of the first three
(3) fiscal quarters of each fiscal year of Borrower (or such earlier date on
which Borrower is required to file a Form 10-Q under the Exchange Act, as
applicable), beginning with the fiscal quarter ending March 31, 2020, a
consolidated balance sheet of Borrower and its Subsidiaries as of the end of
such fiscal quarter, and the related consolidated statements of income and cash
flows and for such fiscal quarter and (in respect of the second and third fiscal
quarters of such fiscal year) for the then-elapsed portion of Borrower’s fiscal
year, setting forth in comparative form the figures for the comparable period or
periods in the previous fiscal year, all prepared in accordance with Applicable
Accounting Standards, subject to normal year-end audit adjustments and the
absence of disclosures normally made in footnotes; provided, however, that
Borrower shall be deemed to have made such delivery of such consolidated
financial statements if such consolidated financial statements shall have been
made available within the time period specified above on the SEC’s EDGAR system
(or any successor system adopted by the SEC). Such consolidated financial
statements shall be certified by a Responsible Officer of Borrower as, to his or
her knowledge, fairly presenting, in all material respects, the consolidated
financial condition, results of operations and cash flows of Borrower and its
Subsidiaries as of the dates and for the periods specified in accordance with
Applicable Accounting Standards consistently applied, and on a basis consistent
with the audited consolidated financial statements referred to under Section
5.2(a)(i), subject to normal year-end audit adjustments and the absence of
footnotes; provided, however, that such certification by a Responsible Officer
of Borrower shall be deemed to have made if a similar certification is required
under the Sarbanes-Oxley Act of 2002 and such certification shall have been made
available within the time period specified above on the SEC’s EDGAR system (or
any successor system adopted by the SEC);

 

(iii)              Quarterly Compliance Certificate. Upon delivery (or within
five (5) Business Days of any deemed delivery) of financial statements pursuant
to Section 5.2(a)(i) and Section 5.2(a)(ii), a duly completed Compliance
Certificate signed by a Responsible Officer, certifying, among other things, (i)
the compliance of the Credit Parties with the covenants set forth in Section 5.2
and Section 6.15, and (ii) no Event of Default or Default has occurred or, if
such an Event of Default or Default has occurred, specifying the nature and
extent thereof and any corrective action taken or proposed to be taken with
respect thereto; and

 

(iv)               Information During Event of Default. As promptly as
practicable (and in any event within five (5) Business Days of the request
therefor), such additional information regarding the business or financial
affairs of Borrower or any of its Subsidiaries, or compliance with the terms of
this Agreement or any other Loan Documents, as the Collateral Agent may from
time to time reasonably request during the existence of any Event of Default
(subject to reasonable requirements of confidentiality, including requirements
imposed by Requirements of Law or contract; provided that Borrower shall not be
obligated to disclose any information that is reasonably subject to the
assertion of attorney-client privilege or attorney work-product).

 

(b)                Notice of Defaults or Events of Default, ERISA Events and
Material Adverse Changes. Written notice as promptly as practicable (and in any
event within five (5) Business Days) after a Responsible Officer of Borrower
shall have become aware thereof, of the occurrence of any (i) Default or Event
of Default, (ii) ERISA Event or (iii) Material Adverse Change.

 

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(c)                 Legal Action Notice.

 

(i)                  Written notice as promptly as practicable (which shall be
deemed given to the extent timely reported in a Form 8-K under the Exchange Act
and available on the SEC’s EDGAR system (or any successor system adopted by the
SEC)) of any legal action, litigation, investigation or proceeding pending or
threatened in writing against any Credit Party or any Subsidiary (i) that would
reasonably be expected to result in uninsured damages or costs to such Credit
Party or such Subsidiary in an amount in excess of the materiality thresholds
applied by Borrower in accordance with the Exchange Act and related regulations
and standards for purposes of its Exchange Act reporting, or (ii) which alleges
potential violations of the Health Care Laws, FDA Laws, DEA Laws or other
Requirements of Law or any applicable statutes, rules, regulations, standards,
guidelines, policies and orders administered or issued by any foreign
Governmental Authority, that, in each case described in clauses (i) and (ii)
above, could, individually or taken together with any other such action,
litigation, investigation or proceeding, reasonably be expected to result in a
Material Adverse Change; and, in each such case, provide such additional
information (including any material development therein) as the Collateral Agent
may reasonably request in relation thereto; provided that Borrower shall not be
obligated to disclose any information that is reasonably subject to the
assertion of attorney-client privilege or attorney work-product;

 

(ii)                Without limiting the generality of clause (i) above, prompt
written updates (which shall be deemed given to the extent timely reported in
the Borrower’s periodic reporting under the Exchange Act and available on the
SEC’s EDGAR system (or any successor system adopted by the SEC)) of the status
of any Opioids Case in which Borrower or any of its Subsidiaries has been named
as a defendant, regarding, without limitation, the total number of such cases;
the jurisdictions in which such cases have been filed, whether any scheduling
order has been established and, if so, the applicable dates, and the status of
discovery and any motions; and

 

(iii)              Promptly, and in no event later than five (5) Business Days
prior to the entry into a settlement agreement with respect to any Opioids Case
or Cases (whether or not settled contemporaneously) for which the settlement
value would cause the total payment by Borrower or any of its Subsidiaries for
Opioids Cases (individually or in the aggregate) to exceed $5,000,000 in the
aggregate, written notice of the material terms of any proposed settlement,
including the value and timing of any payment contemplated to be made by
Borrower or any of its Subsidiaries.

 

5.3.              Taxes. Timely file all foreign, U.S. federal and state income
and other material required Tax returns and reports or extensions therefor and
timely pay all material foreign, federal, state and local Taxes, assessments,
deposits and contributions imposed upon it or any of its properties or assets or
in respect of any of its income, businesses or franchises before any penalty or
fine accrue thereon; provided, however, that no such Tax or any claim for Taxes
that have become due and payable and have or may become a Lien on any Collateral
shall be required to be paid if (a) it is being contested in good faith by
appropriate proceedings promptly instituted and diligently conducted, so long as
adequate reserves therefor have been set aside on its books and maintained in
conformity with Applicable Accounting Standards, and (b) solely in the case of a
Tax or claim that has or may become a Lien against any Collateral, such contest
proceedings conclusively operate to stay the sale or forfeiture of any portion
of any Collateral to satisfy such Tax or claim. No Credit Party will, nor will
it permit any of its Subsidiaries to, file or consent to the filing of any
consolidated income Tax return with any Person (other than Borrower or any of
its Subsidiaries) without the Collateral Agent’s prior written consent.

 

5.4.              Insurance. Maintain with financially sound and reputable
insurance companies, insurance with respect to its properties and business
against loss or damage of the kinds customarily insured against by Persons of
comparable size engaged in the same or similar business, of such types and in
such amounts (after giving effect to any self-insurance reasonable and customary
for similarly situated Persons of comparable size engaged in the same or similar
businesses as Borrower and its Subsidiaries) as are customarily carried under
similar circumstances by such other Persons. Subject to Section 5.14, any
products liability or general liability insurance maintained in the United
States regarding Collateral shall name the Collateral Agent, on behalf of the
Lenders and the other Secured Parties, as additional insured or loss payee, as
applicable (the additional insured clauses or endorsements for which, in form
and substance reasonably satisfactory to the Collateral Agent). So long as no
Event of Default shall have occurred and be continuing, the Borrower and its
Subsidiaries may retain all or any portion of the proceeds of any insurance of
the Borrower and its Subsidiaries (and the Collateral Agent and each Lender
shall promptly remit to the Borrower any proceeds with respect to any insurance
actually received by it).

 

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5.5.              Operating Accounts. In the case of any Credit Party,
contemporaneously with the establishment of any new Collateral Account at or
with any bank or other depository or financial institution located in the United
States, subject such account to a Control Agreement that is reasonably
acceptable to the Collateral Agent. For each Collateral Account that each Credit
Party at any time maintains, such Credit Party shall cause the applicable bank
or other depository or financial institution located in the United States at or
with which any Collateral Account is maintained to execute and deliver a Control
Agreement or other appropriate instrument with respect to such Collateral
Account to perfect the Collateral Agent’s Lien, for the benefit of Lenders and
the other Secured Parties, in such Collateral Account in accordance with the
terms hereunder, which Control Agreement may not be terminated without the prior
written consent of the Collateral Agent. The provisions of the previous two (2)
sentences shall not apply to (1) accounts exclusively used for payroll, payroll
Taxes and other employee wage and benefit payments to or for the benefit of any
Credit Party’s employees, (2) zero balance accounts, (3) accounts (including
trust accounts) used exclusively for escrow, customs, insurance or fiduciary
purposes, (4) merchant accounts, (5) accounts used exclusively for compliance
with any Requirements of Law to the extent such Requirements of Law prohibit the
granting of a Lien thereon, (6) accounts which constitute cash collateral in
respect of a Permitted Lien and (7) any other accounts designated as an Excluded
Account by a Responsible Officer of Borrower in writing delivered to the
Collateral Agent, the cash balance of which such accounts does not exceed
$10,000,000 in the aggregate at any time (all such accounts in sub-clauses (1)
through (7) above, collectively, the “Excluded Accounts”). Notwithstanding the
foregoing, the Credit Parties shall have until the date that is ninety (90) days
(or such longer period as the Collateral Agent may agree in its sole discretion)
following (i) the Closing Date to comply with the provisions of this Section 5.5
with regards to Collateral Accounts (other than Excluded Accounts) of the Credit
Parties in existence on the Closing Date (or opened during such 90-day period)
and (ii) the closing date of any Acquisition or other Investment to comply with
the provisions of this Section 5.5 with regards to Collateral Accounts (other
than Excluded Accounts) of the Credit Parties acquired in connection with such
Acquisition or other Investment.

 

5.6.              Compliance with Laws. Comply in all respects with the
Requirements of Law and all orders, writs, injunctions, decrees and judgments
applicable to it or to its business or its assets or properties (including
Environmental Laws, ERISA, Anti-Money Laundering Laws, OFAC, FCPA, Health Care
Laws, FDA Laws, DEA Laws, Data Protection Laws and the Federal Fair Labor
Standards Act, and any foreign equivalents thereof), except, in each case, if
the failure to comply therewith could not, individually or taken together with
any other such failures, reasonably be expected to result in a Material Adverse
Change.

 

5.7.              Protection of Intellectual Property Rights.

 

(a)                 Except as could not reasonably be expected to result in a
Material Adverse Change, (i) protect, defend and maintain the validity and
enforceability of the Company IP and the Acquisition IP material to the
research, development, manufacture, production, use, commercialization,
marketing, importing, storage, transport, offer for sale, distribution or sale
of any Product in the Territory, including defending any future or current
oppositions, interference proceedings, reissue proceedings, reexamination
proceedings, inter-partes review proceedings, post grant review proceedings,
cancellation proceedings, injunctions, lawsuits, paragraph IV patent
certifications or lawsuits under the Hatch-Waxman Act, hearings, investigations,
complaints, arbitrations, mediations, demands, International Trade Commission
investigations, decrees, or any other disputes, disagreements, or claims,
challenging the legality, validity, enforceability or ownership of any Company
IP or Acquisition IP; (ii) maintain the confidential nature of any material
trade secrets and trade secret rights used in any research, development,
manufacture, production, use, commercialization, marketing, importing, storage,
transport, offer for sale, distribution or sale of any Product in the Territory;
and (iii) not allow any Company IP or Acquisition IP material to the research,
development, manufacture, production, use, commercialization, marketing,
importing, storage, transport, offer for sale, distribution or sale of any
Product in the Territory to be abandoned, forfeited or dedicated to the public
or any Current Company IP Agreement or Current Acquisition IP Agreement to be
terminated by Borrower or any of its Subsidiaries, as applicable, without the
Collateral Agent’s prior written consent (such consent not to be unreasonably
withheld, conditioned or delayed); provided, however, that with respect to any
such Company IP or Acquisition IP that is not owned by Borrower or any of its
Subsidiaries, the obligations in clauses (i) and (iii) above shall apply only to
the extent Borrower or any of its Subsidiaries have the right to take such
actions or to cause any licensee or other third party to take such actions
pursuant to applicable agreements or contractual rights.

 

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(b)                Except as Borrower may otherwise determine in its reasonable
business or legal judgment, (i) use commercially reasonable efforts, at its (or
its Subsidiaries’, as applicable) sole expense, either directly or indirectly,
with respect to any licensee or licensor under the terms of any Credit Party’s
(or any of its Subsidiary’s) agreement with the respective licensee or licensor,
as applicable, to take any and all actions (including taking legal action to
specifically enforce the applicable terms of any license agreement) and prepare,
execute, deliver and file agreements, documents or instruments which are
necessary or desirable to (A)  prosecute and maintain the Company IP and
Acquisition IP material to the research, development, manufacture, production,
use, commercialization, marketing, importing, storage, transport, offer for
sale, distribution or sale of any Product in the Territory and (B) diligently
defend or assert the Company IP and Acquisition IP material to the research,
development, manufacture, production, use, commercialization, marketing,
importing, storage, transport, offer for sale, distribution or sale of any
Product in the Territory against material infringement, misappropriation,
violation or interference by any other Persons and, in the case of Copyrights,
Trademarks and Patents within the Company IP, against any claims of invalidity
or unenforceability (including by bringing any legal action for infringement,
dilution, violation or defending any counterclaim of invalidity or action of a
non-Affiliate third party for declaratory judgment of non-infringement or
non-interference); and (ii) use commercially reasonable efforts to cause any
licensee or licensor of any Company IP or Acquisition IP not to, and such Credit
Party shall not, disclaim or abandon, or fail to take any action necessary or
desirable to prevent the disclaimer or abandonment of any Company IP or
Acquisition IP material to the research, development, manufacture, production,
use, commercialization, marketing, importing, storage, transport, offer for
sale, distribution or sale of any Product in the Territory.

 

(c)                 Except as Borrower may otherwise determine in its reasonable
business or legal judgment, (i) protect, defend and maintain market exclusivity
for the manufacture, production, use, commercialization, marketing, importing,
storage, transport, offer for sale, distribution or sale of any Product in the
Territory through the Term Loan Maturity Date, and (ii) use commercially
reasonable efforts to not allow for the manufacture, production, use,
commercialization, marketing, importing, storage, transport, offer for sale,
distribution or sale of a generic version of any Product in the Territory before
the Term Loan Maturity Date. Borrower agrees to: (x) notify the Collateral Agent
in writing of and (y) keep the Collateral Agent informed regarding; and (z) at
the reasonable request of the Collateral Agent in writing, consult with and
consider in good faith any reasonable comments of the Collateral Agent (provided
that Borrower shall not be obligated to disclose any information that is
reasonably subject to the assertion of attorney-client privilege or attorney
work-product) regarding, in each case of clauses (x), (y) and (z) above, with
reasonable detail, any filings in any opposition, interference proceeding,
reissue proceeding, reexamination proceeding, inter-partes review proceeding,
post grant review proceeding, cancellation proceeding, injunction, lawsuit,
paragraph IV patent certification or lawsuits under the Hatch-Waxman Act,
hearing, investigation, complaint, arbitration, mediation, demand, International
Trade Commission investigation, decree, or any other dispute, disagreement or
claim, challenging the legality, validity, enforceability or ownership of any
Company IP or Acquisition IP.

 

(d)                Provide written notice to the Collateral Agent within thirty
(30) days of entering or becoming bound by any Restricted License (other than
over-the-counter software that is commercially available to the public). Each
Credit Party shall take such commercially reasonable steps as the Collateral
Agent requests to obtain the consent of, or waiver by, any Person whose consent
or waiver is necessary for (i) any Restricted License to, without giving effect
to Section 9-408 of the Code, be deemed “Collateral” and for the Collateral
Agent to have a security interest in it that might otherwise be restricted or
prohibited by law or by the terms of any such Restricted License, whether now
existing or entered into in the future, and (ii) the Collateral Agent to have
the ability in the event of a liquidation of any Collateral to dispose of such
Collateral in accordance with the Collateral Agent’s rights and remedies under
this Agreement and the other Loan Documents.

 

5.8.              Books and Records. Maintain proper Books, in which entries
that are full, true and correct in all material respects and are in conformity
with Applicable Accounting Standards consistently applied shall be made of all
material financial transactions and matters involving the assets, properties and
business of such Credit Party (or such Subsidiary), as the case may be.

 

5.9.              Access to Collateral; Audits. Allow the Collateral Agent, or
its agents or representatives, at any time after the occurrence and during the
continuance of an Event of Default, during normal business hours and upon
reasonable advance notice, to visit and inspect the Collateral and inspect, copy
and audit any Credit Party’s Books. The foregoing inspections and audits shall
be at the relevant Credit Party’s expense.

 

29

 

 

5.10.           Use of Proceeds. (a) Use the proceeds of the Term Loans solely
to fund and pay in accordance with the terms thereof the amounts required under
Section 2.05 of the Purchase Agreement, to fund and pay any fees and expenses
relating to this Agreement and the transactions contemplated by the Acquisition
Agreement and for general corporate purposes, and (b) not use the proceeds of
the Term Loans or any other Credit Extensions, directly or indirectly, for the
purpose of purchasing or carrying any Margin Stock, for the purpose of reducing
or retiring any Indebtedness that was originally incurred to purchase or carry
any Margin Stock, for the purpose of extending credit to any other Person to
purchase or carry any Margin Stock or for any other purpose that might cause any
Term Loan or other Credit Extension to be considered a “purpose credit” within
the meaning of Regulation T, U or X of the Federal Reserve Board. If requested
by the Collateral Agent, Borrower shall complete and sign Part I of a copy of
Federal Reserve Form G-3 referred to in Regulation U and deliver such copy to
the Collateral Agent.

 

5.11.           Further Assurances. Promptly upon the reasonable written request
of the Collateral Agent, execute, acknowledge and deliver such further documents
and do such other acts and things in order to effectuate or carry out more
effectively the purposes of this Agreement and the other Loan Documents at its
expense, including after the Closing Date taking such steps as are reasonably
deemed necessary or desirable by the Collateral Agent to attach, maintain,
perfect, protect and enforce its Lien, for the benefit of Lenders and the other
Secured Parties, on Collateral securing the Obligations created under the
Security Agreement and the other Loan Documents in accordance with the terms of
the Security Agreement and the other Loan Documents, subject to Permitted Liens;
provided, however, that Credit Parties and their Subsidiaries shall not be
required to take any action under laws outside the United States to attach,
maintain, protect or perfect any Lien of the Collateral Agent, for the benefit
of Lenders and the other Secured Parties, on Collateral.

 

5.12.           Additional Collateral; Guarantors.

 

(a)                 From and after the Closing Date, except as otherwise
approved in writing by the Collateral Agent, each Credit Party shall cause each
of its Subsidiaries (other than Excluded Subsidiaries) to guarantee the
Obligations and to cause each such Subsidiary to grant to the Collateral Agent,
for the benefit of Lenders and the other Secured Parties, a first priority
security interest in and Lien upon, and pledge to the Collateral Agent for the
benefit of Lenders and the other Secured Parties, subject to Permitted Liens,
all of such Subsidiary’s properties and assets constituting Collateral, whether
now existing or hereafter acquired or existing, to secure such guaranty;
provided, that such Credit Party’s obligations to cause any Subsidiaries formed
or acquired after the Closing Date to take the foregoing actions shall be
subject to the timing requirements of Section 5.13. Furthermore, except as
otherwise approved in writing by the Collateral Agent, each Credit Party, from
and after the Closing Date, shall, and shall cause each of its Subsidiaries to,
grant the Collateral Agent, for the benefit of Lenders and the other Secured
Parties, a first priority security interest in and Lien upon, and pledge to the
Collateral Agent, for the benefit of Lenders and the other Secured Parties,
subject to Permitted Liens, the limitations set forth herein and the limitations
set forth in the other Loan Documents, all of the Equity Interests (other than
Excluded Equity Interests) in each of its Subsidiaries. Subject to Section 5.14,
in connection with each pledge of certificated Equity Interests required under
the Loan Documents, the Credit Parties shall deliver, or cause to be delivered,
to the Collateral Agent, such certificate(s) together with stock powers or
assignments, as applicable, properly endorsed for transfer to the Collateral
Agent or duly executed in blank, in each case, in form and substance reasonably
satisfactory to the Collateral Agent. Subject to Section 5.14, in connection
with each pledge of uncertificated Equity Interests required under the Loan
Documents, the Credit Parties shall deliver, or cause to be delivered, to the
Collateral Agent an executed uncertificated stock control agreement among the
issuer, the registered owner and the Collateral Agent, substantially in the form
attached as an annex to the Security Agreement.

 

(b)                In the event any Credit Party acquires any fee title to real
estate in the U.S. with a fair market value (reasonably determined in good faith
by a Responsible Officer of Borrower) in excess of $5,000,000, unless otherwise
agreed by the Collateral Agent, such Person shall execute or deliver, or cause
to be executed or delivered, to the Collateral Agent, (i) within sixty (60) days
after such acquisition, an appraisal complying with the Financial Institutions
Reform, Recovery and Enforcement Act of 1989, (ii) within forty-five (45) days
after receipt of notice from the Collateral Agent that such real estate is
located in a Special Flood Hazard Area, Federal Flood Insurance, (iii) within
sixty (60) days after such acquisition, a fully executed Mortgage, in form and
substance reasonably satisfactory to the Collateral Agent, together with an
A.L.T.A. lender’s title insurance policy issued by a title insurer reasonably
satisfactory to the Collateral Agent, in form and substance (including any
endorsements) and in an amount reasonably satisfactory to the Collateral Agent
insuring that the Mortgage is a valid and enforceable first priority Lien on the
respective property, free and clear of all defects, encumbrances and Liens
(other than Permitted Liens), (iv) simultaneously with such acquisition,
then-current A.L.T.A. surveys, certified to the Collateral Agent by a licensed
surveyor sufficient to allow the issuer of the lender’s title insurance policy
to issue such policy without a survey exception and (v) within sixty (60) days
after such acquisition, an environmental site assessment prepared by a qualified
firm reasonably acceptable to the Collateral Agent, in form and substance
satisfactory to the Collateral Agent.

 

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5.13.           Formation or Acquisition of Subsidiaries. If Borrower or any of
its Subsidiaries at any time after the Closing Date forms or acquires a
Subsidiary (including by division), as promptly as practicable but in no event
later than thirty (30) days (or such longer period as the Collateral Agent may
agree in its sole discretion) after such formation or acquisition: (a) without
limiting the generality of clause (d) below, Borrower will cause such Subsidiary
(other than an Excluded Subsidiary) to execute and deliver to the Collateral
Agent a joinder to the Security Agreement in the form attached thereto and any
relevant IP Agreement or other Collateral Documents, as applicable; (b) Borrower
will deliver to the Collateral Agent (i) true, correct and complete copies of
the Operating Documents of such Subsidiary (other than an Excluded Subsidiary),
(ii) a Secretary’s Certificate, certifying that the copies of the Operating
Documents of such Subsidiary (other than an Excluded Subsidiary) are true,
correct and complete (such Secretary’s Certificate to be in form and substance
reasonably satisfactory to the Collateral Agent) and (iii) a good standing
certificate for such Subsidiary (other than an Excluded Subsidiary) certified by
the Secretary of State (or the equivalent thereof) of its jurisdiction of
organization, incorporation or formation; (c) Borrower will deliver to the
Collateral Agent an update to the Perfection Certificate reflecting the
formation or acquisition of such Subsidiary (other than an Excluded Subsidiary);
and (d) Borrower will cause such Subsidiary to satisfy all requirements
contained in this Agreement (including Section 5.12) and each other Loan
Document if and to the extent applicable to such Subsidiary. Borrower, Lenders
and the Collateral Agent hereby agree that any such Subsidiary (other than an
Excluded Subsidiary) shall constitute a Credit Party for all purposes hereunder
as of the date of the execution and delivery of the joinder contemplated by
clause (a) above. Any document, agreement or instrument executed or issued
pursuant to this Section 5.13 shall be a Loan Document.

 

5.14.           Post-Closing Requirements. Borrower will, and will cause each of
its Subsidiaries to, take each of the actions set forth on Schedule 5.14 of the
Disclosure Letter within the time period prescribed therefor on such schedule
(or such longer period as the Collateral Agent may agree in its sole
discretion), which shall include, among other things, that (a) notwithstanding
anything to the contrary in Section 5.4, the Credit Parties shall have until the
date that is thirty (30) days following the Closing Date (or such longer period
as the Collateral Agent may agree in its sole discretion) to comply with the
provisions of Section 5.4 with regards to naming the Collateral Agent, on behalf
of the Lenders and the other Secured Parties, as additional insured or loss
payee, on any products liability and general liability insurance maintained in
the United States regarding Collateral on the Closing Date, (b) notwithstanding
anything to the contrary in Section 5.5, the Credit Parties shall have until the
date that is ninety (90) days following the Closing Date (or such longer period
as the Collateral Agent may agree in its sole discretion) to comply with the
provisions of Section 5.5 with regards to Collateral Accounts of the Credit
Parties in existence on the Closing Date or opened during such 90-day period,
and (c) notwithstanding anything to the contrary in Section 6.2(b), the Credit
Parties shall have until the date that is thirty (30) days following the Closing
Date (or such longer period as the Collateral Agent may agree in its sole
discretion) to comply with the provisions of Section 6.2(b)(ii) with regards to
the location of the primary Books of any Credit Party or any of its Subsidiaries
or the location of any material portion of the Collateral as of the Closing Date
or during such 30-day period. All representations and warranties and covenants
contained in this Agreement and the other Loan Documents shall be deemed
modified to the extent necessary to take the actions set forth on Schedule 5.14
of the Disclosure Letter within the time periods set forth therein, rather than
elsewhere provided in the Loan Documents, such that to the extent any such
action set forth in Schedule 5.14 of the Disclosure Letter is not overdue, the
applicable Credit Party shall not be in breach of any representation or warranty
or covenant contained in this Agreement or any other Loan Document applicable to
such action for the period from the Closing Date until the date on which such
action is required to be fulfilled as set forth on Schedule 5.14 of the
Disclosure Letter.

 

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5.15.           Environmental.

 

(a)                 Deliver to the Collateral Agent:

 

(i)                  as soon as practicable following receipt thereof, copies of
all environmental audits, investigations, analyses and reports of any kind or
character, whether prepared by personnel of Borrower or any of its Subsidiaries
or by independent consultants, governmental authorities or any other Persons,
with respect to significant environmental matters at any Facility or with
respect to any material Environmental Claims;

 

(ii)                promptly upon a Responsible Officer of Borrower obtaining
knowledge of the occurrence thereof, written notice describing in reasonable
detail (A) any Release required to be reported to any federal, state or local
governmental or regulatory agency under any applicable Environmental Laws, (B)
any remedial action taken by any Credit Party or any other Person in response to
(x) any Hazardous Materials Activities, the existence of which, individually or
in the aggregate, could reasonably be expected to result in one or more
Environmental Claims resulting in a Material Adverse Change, or (y) any
Environmental Claims that, individually or in the aggregate, could reasonably be
expected to result in a Material Adverse Change, and (C) any Credit Party’s
discovery of any occurrence or condition on any real property adjoining or in
the vicinity of any Facility that could cause such Facility or any part thereof
to be subject to any material restrictions on the ownership, occupancy,
transferability or use thereof under any Environmental Laws, provided, that with
respect to real property adjoining or in the vicinity of any Facility, Borrower
shall have no duty to affirmatively investigate or make any efforts to become or
stay informed regarding any such adjoining or nearby properties;

 

(iii)              as soon as practicable following the sending or receipt
thereof by any Credit Party, a copy of any and all written communications with
respect to (A) any Environmental Claims that, individually or in the aggregate,
could reasonably be expected to result in a Material Adverse Change, (B) any
Release required to be reported to any federal, state or local governmental or
regulatory agency, or (C) any request for information from any Governmental
Authority that suggests such Governmental Authority is investigating whether any
Credit Party or any of its Subsidiaries may be potentially responsible for any
Hazardous Materials Activity that, individually or in the aggregate, could
reasonably be expected to result in a Material Adverse Change;

 

(iv)               prompt written notice describing in reasonable detail (A) any
proposed acquisition of stock, assets, or property by Borrower or any of its
Subsidiaries that, individually or in the aggregate, could reasonably be
expected to (x) expose Borrower or any of its Subsidiaries to, or result in,
Environmental Claims that could reasonably be expected to result in a Material
Adverse Change or (y) affect the ability of Borrower or any of its Subsidiaries
to maintain in full force and effect all material Governmental Approvals
required under any Environmental Laws for their respective operations, and (B)
any proposed action to be taken by Borrower or any of its Subsidiaries to modify
current operations in a manner that, individually or taken together with any
other such proposed actions, could reasonably be expected to subject Borrower or
any of its Subsidiaries to any additional material obligations or requirements
under any Environmental Laws; and

 

(v)                with reasonable promptness, such other documents and
information as from time to time may be reasonably requested by the Collateral
Agent in relation to any matters disclosed pursuant to this Section 5.15(a).

 

(b)                Each Credit Party shall, and shall cause each of its
Subsidiaries to, promptly take any and all actions reasonably necessary to (i)
cure any violation of applicable Environmental Laws by Borrower or any of its
Subsidiaries that, individually or in the aggregate, could reasonably be
expected to result in a Material Adverse Change, and (ii) make an appropriate
response to any Environmental Claim against Borrower or any of its Subsidiaries
and discharge any obligations it may have to any Person thereunder where failure
to do so, individually or in the aggregate, could reasonably be expected to
result in a Material Adverse Change.

 

5.16.           Inventory; Returns; Maintenance of Properties. Keep all
Inventory in good and marketable condition, free from material defects and
otherwise keep all Inventory in material compliance with all applicable FDA Good
Manufacturing Practices. Returns and allowances between Borrower and its Account
Debtors shall follow Borrower’s customary practices as they exist at the
Effective Date or any new returns and allowances practices established
thereafter in good faith by Borrower. Each Credit Party will, and will cause
each of its Subsidiaries to, maintain or cause to be maintained in good repair,
working order and condition, ordinary wear and tear, casualty and condemnation
excepted, any and all material tangible properties used or useful in its
respective business, and from time to time will make or cause to be made all
appropriate repairs, renewals and replacements thereof, except where failure to
do so could not reasonably be expected to result in a Material Adverse Change.

 

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6.                   NEGATIVE COVENANTS

 

Each Credit Party covenants and agrees that, until payment in full of all
Obligations (other than inchoate indemnity obligations), such Credit Party shall
not, and shall cause each of its Subsidiaries not to:

 

6.1.              Dispositions. Convey, sell, lease, transfer, assign, covenant
not to sue, enter into a coexistence agreement, exclusively or non-exclusively
license out, or otherwise dispose of (including any sale-leaseback or any
transfer of assets pursuant to a plan of division), directly or indirectly and
whether in one or a series of transactions (collectively, “Transfer”), all or
any part of its properties or assets constituting Collateral under the Loan
Documents (including, for the avoidance of doubt, any Equity Interests
constituting Collateral issued by any Subsidiary which are owned or otherwise
held by such Credit Party), other than Permitted Transfers (unless otherwise
expressly prohibited under Section 6.6(b)).

 

6.2.              Fundamental Changes; Location of Collateral.

 

(a)                 Without at least ten (10) days prior written notice to the
Collateral Agent, solely in the case of a Credit Party: (i) change its
jurisdiction of organization, incorporation or formation, (ii) change its
organizational structure or type, (iii) change its legal name, or (iv) change
any organizational number (if any) assigned by its jurisdiction of organization,
incorporation or formation.

 

(b)                Maintain its primary Books or deliver any material portion of
the Collateral to one or more mortgaged or leased locations or one or more
warehouses, processors or bailees, as applicable, unless (i) with respect to any
new mortgaged or leased location or new warehouse, processor or bailee, such
Credit Party has delivered at least fifteen (15) days’ prior written notice to
the Collateral Agent, which such notice shall in reasonable detail identify such
Books or Collateral (as applicable) and indicate the location from which it is
being delivered and the location to which it is being delivered (and may be in
the form of an update to the Perfection Certificate; provided that any update to
the Perfection Certificate by any Credit Party pursuant to this Section
6.2(b)(i) shall not relieve any Credit Party of any other Obligation under this
Agreement, including under clause (ii) below), and (ii) subject to Section 5.14,
a Collateral Access Agreement for such mortgaged or leased location or such
warehouse, processor or bailee governing both such Books or Collateral (as
applicable) and the location to which such Books or Collateral (as applicable)
has been executed and delivered by all parties thereto (in form and substance
reasonably satisfactory to the Collateral Agent).

 

(c)                 In the case of Collegium NF, LLC, engage in any business
operations (other than (x) being party to the Commercialization Agreement, the
ongoing provisions of which after the Closing Date shall be restricted to those
identified in the Purchase Agreement, including the license of AccuForm patents
on a non-exclusive royalty free basis, and (y) the sublicensing of the AccuForm
patents to the Borrower on a non-exclusive royalty free basis) unless and until
such Person is made a Guarantor hereunder and a grantor under the Security
Agreement in accordance with the terms hereof and thereof.

 

6.3.              Mergers, Liquidations or Dissolutions.

 

(a)                 Merge, divide itself into two (2) or more entities,
consolidate, liquidate or dissolve, or permit any of its Subsidiaries to merge,
divide itself into two (2) or more entities, consolidate, liquidate or dissolve
with or into any other Person, except that:

 

(i)                  any Subsidiary of Borrower may merge, consolidate,
liquidate or dissolve with or into Borrower, provided that Borrower is the
surviving entity;

 

(ii)                any Subsidiary of Borrower may merge, consolidate, liquidate
or dissolve with or into any other Subsidiary of Borrower, provided that if any
party to such merger, consolidation, liquidation or dissolution is a Credit
Party then either (A) such Credit Party is the surviving entity or (B) the
surviving or resulting entity executes and delivers to the Collateral Agent a
joinder to the Security Agreement in the form attached thereto and any relevant
IP Agreement or other Collateral Documents, as applicable, and otherwise
satisfies the requirements of Section 5.13 substantially contemporaneously with
completion thereof, as applicable;

 

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(iii)              any Subsidiary of Borrower may divide itself into two (2) or
more entities or be dissolved or liquidated, provided that, if such Subsidiary
is a Credit Party, the properties and assets of such Subsidiary are allocated or
distributed to an existing or newly-formed Credit Party; and

 

(iv)               any Permitted Acquisition or Permitted Investment may be
structured as a merger or consolidation.

 

(b)                Make, or permit any of its Subsidiaries to make, Acquisitions
outside the ordinary course of business, including any purchase of the assets of
any division or line of business of any other Person, other than Permitted
Acquisitions or Permitted Investments.

 

6.4.              Indebtedness. Directly or indirectly, create, incur, assume or
guaranty, or otherwise become or remain directly or indirectly liable with
respect to, any Indebtedness (including any Indebtedness consisting of
obligations evidenced by a bond, debenture, note or other similar instrument)
that is not Permitted Indebtedness; provided, however, that the accrual of
interest, the accretion of accreted value and the payment of interest in the
form of additional Indebtedness shall not be deemed to be an incurrence of
Indebtedness for purposes of this Section 6.4.

 

6.5.              Encumbrances. Except for Permitted Liens, (i) create, incur,
allow, or suffer to exist any Lien on any Collateral (or any portion thereof) or
all or any part of any Company IP or Acquisition IP that does not constitute
Collateral, or (ii) permit (other than pursuant to the terms of the Loan
Documents) any Collateral (or any portion thereof) not to be subject to the
first priority security interest granted in the Loan Documents or otherwise
pursuant to the Collateral Documents, other than, in the case of this clause
(ii), as a direct result of any action by the Collateral Agent or any Lender or
failure of the Collateral Agent or any Lender to perform an obligation thereof
under the Loan Documents.

 

6.6.              No Further Negative Pledges; Negative Pledge.

 

(a)                 No Credit Party nor any of its Subsidiaries shall enter into
any agreement, document or instrument directly or indirectly prohibiting (or
having the effect of prohibiting) or limiting the ability of such Credit Party
or Subsidiary to create, incur, assume or suffer to exist any Lien upon any
Collateral, whether now owned or hereafter acquired, in favor of the Collateral
Agent, for the benefit of Lenders and the other Secured Parties, with respect to
the Obligations or under the Loan Documents, other than Permitted Negative
Pledges.

 

(b)                Notwithstanding anything to the contrary in Section 6.1 or
Section 6.5, no Credit Party will sell, assign, transfer, exchange or otherwise
dispose of, or create, incur, allow or suffer to exist any Lien on, any Equity
Interests constituting Collateral issued by any Subsidiary which are owned or
otherwise held by such Credit Party, except for: (i) Permitted Liens; (ii)
transfers between or among Credit Parties, provided that any and all steps as
may be required to be taken in order to create and maintain a first priority
security interest in and Lien upon such Equity Interests in favor of the
Collateral Agent, for the benefit of Lenders and the other Secured Parties, are
taken contemporaneously with the completion of any such transfer; and (iii)
sales, assignments, transfers, exchanges or other dispositions to qualify
directors if required by Requirements of Law or otherwise permitted under this
Agreement, provided that such sale, assignment, transfer, exchange or other
disposition shall be for the minimum number of Equity Interests as are necessary
for such qualification under Requirements of Law.

 

6.7.              Maintenance of Collateral Accounts. No Credit Party shall
maintain any Collateral Account in the United States, except pursuant to the
terms of Section 5.5 hereof.

 

6.8.              Distributions; Investments.

 

(a)                 Pay any dividends or make any distribution or payment on or
redeem, retire or purchase any Equity Interests, other than Permitted
Distributions.

 

(b)                Directly or indirectly make any Investment, other than
Permitted Acquisitions or Permitted Investments.

 

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6.9.              No Restrictions on Subsidiary Distributions. No Credit Party
nor any of its Subsidiaries shall enter into any agreement, document or
instrument directly or indirectly prohibiting (or having the effect of
prohibiting) or limiting the ability of any Subsidiary of Borrower to (a) pay
dividends or make any other distributions on any of such Subsidiary’s Equity
Interests owned by Borrower or any other Subsidiary of Borrower, (b) repay or
prepay any Indebtedness owed by such Subsidiary to Borrower or any other
Subsidiary of Borrower, (c) make loans or advances to Borrower or any other
Subsidiary of Borrower, or (d) transfer, lease or license any Collateral to
Borrower or any other Subsidiary of Borrower, in each case other than Permitted
Subsidiary Distribution Restrictions.

 

6.10.           Subordinated Debt. Make or permit any voluntary or optional
prepayment of any Subordinated Debt not otherwise expressly permitted pursuant
to the applicable intercreditor, subordination or other similar agreement to
which such Subordinated Debt is subject.

 

6.11.           Amendments or Waivers of Organizational Documents. Amend,
restate, supplement or otherwise modify, or waive, any provision of its
Operating Documents in a manner that could reasonably be expected to result in a
Material Adverse Change.

 

6.12.           Compliance.

 

(a)                 Become an “investment company” under the Investment Company
Act of 1940, as amended, or undertake as one of its important activities
extending credit to purchase or carry margin stock (as defined in Regulation U
of the Board of Governors of the Federal Reserve System), or use the proceeds of
any Credit Extension for that purpose;

 

(b)                No ERISA Affiliate shall cause or suffer to exist (i) any
event that would result in the imposition of a Lien on any assets or properties
of any Credit Party or a Subsidiary of a Credit Party with respect to any Plan
or Multiemployer Plan or (ii) any other ERISA Event, that, in either case, could
reasonably be expected to, individually or in the aggregate, result in a
Material Adverse Change; or

 

(c)                 Permit the occurrence of any other event with respect to any
present pension, profit sharing or deferred compensation plan that could
reasonably be expected to result in a Material Adverse Change.

 

6.13.           Compliance with Sanctions and Anti-Money Laundering Laws. The
Collateral Agent and each Lender hereby notifies each Credit Party that pursuant
to the requirements of Sanctions and Anti-Money Laundering Laws, and such
Person’s policies and practices, the Collateral Agent and each Lender is
required to obtain, verify and record certain information and documentation that
identifies each Credit Party and its principals, which information includes the
name and address of each Credit Party and its principals and such other
information that will allow the Collateral Agent and each Lender to identify
such party in accordance with Sanctions and Anti-Money Laundering Laws. No
Credit Party will, nor will any Credit Party permit any of its Subsidiaries or
controlled Affiliates to, directly or indirectly, knowingly enter into any
documents or contracts with any Blocked Person. Each Credit Party shall promptly
(but in any event within three (3) Business Days) notify the Collateral Agent
and each Lender in writing upon any Responsible Officer of Borrower having
knowledge that any Credit Party or any Subsidiary or Affiliate of any Credit
Party is a Blocked Person or (a) is convicted on, (b) pleads nolo contendere to,
(c) is indicted on, or (d) is arraigned and held over on charges involving money
laundering or predicate crimes to money laundering. No Credit Party will, nor
will any Credit Party permit any of its Subsidiaries or controlled Affiliates
to, directly or indirectly, (i) conduct any business or engage in any
transaction or dealing with any Blocked Person, including the making or
receiving of any contribution of funds, goods or services to or for the benefit
of any Blocked Person, (ii) deal in, or otherwise engage in any transaction
relating to, any property or interests in property blocked pursuant to
Sanctions, or (iii) engage in or conspire to engage in any transaction that
evades or avoids or violates, or has the purpose of evading or avoiding, or
attempts to violate, any of the prohibitions set forth in applicable Sanctions
or Anti-Money Laundering Laws.

 

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6.14.           Amendments or Waivers of Current Company IP Agreements and
Current Acquisition IP Agreements. (a) Waive, amend, cancel or terminate,
exercise or fail to exercise, any material rights constituting or relating to
any of the Current Company IP Agreements or the Current Acquisition IP
Agreements, or (b) breach, default under, or take any action or fail to take any
action that, with the passage of time or the giving of notice or both, would
constitute a default or event of default under any of the Current Company IP
Agreements or the Current Acquisition IP Agreements, in each instance described
in clause (a) and (b) above, that could, individually or taken together with any
other such waivers, amendments, cancellations, terminations, exercises or
failures, reasonably be expected to result in a Material Adverse Change.

 

6.15.           Minimum Revenue. Permit trailing twelve-month Net Sales, tested
at the end of each fiscal quarter commencing with the fiscal quarter ending
December 31, 2020, to be less than $200,000,000.

 

7.                   EVENTS OF DEFAULT

 

Any one of the following shall constitute an event of default (an “Event of
Default”) under this Agreement:

 

7.1.              Payment Default. Any Credit Party fails to (a) make any
payment of any principal of the Term Loans when and as the same shall become due
and payable, whether at the due date thereof (including pursuant to Section
2.2(c)) or at a date fixed for prepayment (whether voluntary or mandatory)
thereof or by acceleration thereof or otherwise, or (b) within five (5) Business
Days after the same becomes due, any payment of interest or premium pursuant to
Section 2.2, including any applicable Additional Consideration, Makewhole Amount
or Prepayment Premium, or any other Obligations (which five (5) Business Day
cure period shall not apply to any such payments due on the Term Loan Maturity
Date, such earlier date pursuant to Section 2.2(c)(ii) hereof or the date of
acceleration pursuant to Section 8.1(a) hereof). A failure to pay any such
interest, premium or Obligations pursuant to the foregoing clause (b) prior to
the end of such five (5) Business Day-period shall not constitute an Event of
Default (unless such payment is due on the Term Loan Maturity Date, such earlier
date pursuant to Section 2.2(c)(ii) hereof or the date of acceleration pursuant
to Section 8.1(a) hereof).

 

7.2.              Covenant Default.

 

(a)                 The Credit Parties: (i) fail or neglect to perform any
obligation in Sections 5.2, 5.3, 5.4, 5.5, 5.6, 5.7, 5.10, 5.12, 5.13 or 5.14 or
(ii) violate any covenant in Section 6; or

 

(b)                The Credit Parties fail or neglect to perform, keep, or
observe any other term, provision, condition, covenant or agreement contained in
this Agreement or any Loan Documents on its part to be performed, kept or
observed and such failure continues for ten (10) days, after the earlier of the
date on which (i) a Responsible Officer becomes aware of such failure and (ii)
written notice thereof shall have been given to the Borrower by the Collateral
Agent. Cure periods provided under this Section 7.2(b) shall not apply, among
other things, to any of the covenants referenced in clause (a) above.

 

7.3.              Material Adverse Change. A Material Adverse Change occurs.

 

7.4.              Attachment; Levy; Restraint on Business.

 

(a)                 (i) The service of process seeking to attach, by trustee or
similar process, any funds of any Credit Party or of any entity under the
control of any Credit Party (including a Subsidiary) in excess of $10,000,000 on
deposit or otherwise maintained with the Collateral Agent, or (ii) a notice of
lien or levy is filed against any material portion of the Collateral by any
Governmental Authority, and the same under clauses (i) and (ii) above are not,
within thirty (30) days after the occurrence thereof, discharged or stayed
(whether through the posting of a bond or otherwise); provided, however, that no
Credit Extensions shall be made during any thirty (30) day cure period; or

 

(b)                (i) Any material portion of Collateral is attached, seized,
levied on, or comes into possession of a trustee or receiver, or (ii) any court
order enjoins, restrains, or prevents Borrower and its Subsidiaries from
conducting any material part of their business, taken as a whole.

 

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7.5.              Insolvency.

 

(a)                 An involuntary proceeding shall be commenced or an
involuntary petition shall be filed in a court of competent jurisdiction
seeking: (i) relief in respect of any Credit Party, or of a substantial part of
the property of any Credit Party, under Title 11 of the United States Code, as
now constituted or hereafter amended, or any other federal, state or foreign
bankruptcy, insolvency, receivership or similar law; (ii) the appointment of a
receiver, trustee, custodian, sequestrator, conservator or similar official for
any Credit Party or for a substantial part of the property or assets of any
Credit Party; or (iii) the winding-up or liquidation of any Credit Party, and
such proceeding or petition shall continue undismissed or unstayed for sixty
(60) days or an order or decree approving or ordering any of the foregoing shall
be entered; or

 

(b)                Any Credit Party shall: (i) voluntarily commence any
proceeding or file any petition seeking relief under Title 11 of the United
States Code, as now constituted or hereafter amended, or any other federal,
state or foreign bankruptcy, insolvency, receivership or similar law; (ii)
consent to the institution of, or fail to contest in a timely and appropriate
manner, any proceeding or the filing of any petition described in clause (a)
above; (iii) apply for or consent to the appointment of a receiver, trustee,
custodian, sequestrator, conservator or similar official for any Credit Party or
for a substantial part of the property or assets of any Credit Party; (iv) file
an answer admitting the material allegations of a petition filed against it in
any such proceeding; (v) make a general assignment for the benefit of creditors;
(vi) become unable, admit in writing its inability or fail generally to pay its
debts as they become due; (vii) take any action for the purpose of effecting any
of the foregoing; or (viii) wind up or liquidate (except as otherwise expressly
permitted hereunder).

 

7.6.              Other Agreements. Any Credit Party fails to pay any
Indebtedness (other than the Indebtedness represented by this Agreement and the
other Loan Documents) within any applicable grace period after such payment is
due and payable (including at final maturity) or after the acceleration of any
such Indebtedness by the holder(s) thereof because of a breach or default, if
the total amount of such unpaid or accelerated Indebtedness exceeds $10,000,000,
individually or together with any other such unpaid or accelerated Indebtedness.

 

7.7.              Judgments. One or more final, non-appealable judgments,
orders, or decrees for the payment of money in an amount in excess of
$10,000,000 (but excluding any final judgments, orders, or decrees for the
payment of money that are covered by independent third-party insurance as to
which liability has not been denied by such insurance carrier or by an
indemnification claim against a solvent and unaffiliated Person that is not a
Credit Party as to which such Person has not denied liability for such claim),
shall be rendered against one or more Credit Parties and the same are not,
within thirty (30) days after the entry thereof, discharged or execution thereof
stayed or bonded pending appeal, or such judgments are not discharged prior to
the expiration of any such stay.

 

7.8.              Misrepresentations. Any Credit Party or any Person acting for
any Credit Party makes or is deemed to make any representation, warranty, or
other statement now or later in this Agreement, any other Loan Document or in
any writing delivered to the Collateral Agent or any Lender or to induce the
Collateral Agent or any Lender to enter this Agreement or any other Loan
Document, and such representation, warranty, or other statement is incorrect in
any material respect (or, to the extent any such representation, warranty or
other statement is qualified by materiality or Material Adverse Change, in any
respect) when made or deemed to be made.

 

7.9.              Loan Documents; Collateral. (a) Any material provision of any
Loan Document shall for any reason cease to be valid and binding on or
enforceable against any Credit Party, or any Credit Party shall so state in
writing or bring an action to limit its obligations or liabilities thereunder;
or (b) any Collateral Document shall for any reason (other than pursuant to the
terms thereof) cease to create a valid security interest in any material portion
of the Collateral purported to be covered thereby or such security interest
shall for any reason (other than pursuant to the terms of the Loan Documents)
cease to be a perfected and first priority security interest in any material
portion of the Collateral subject thereto, subject only to Permitted Liens,
other than as a direct result of any action by the Collateral Agent or any
Lender or failure of the Collateral Agent or any Lender to perform an obligation
thereof under the Loan Documents.

 

7.10.           ERISA Event. An ERISA Event occurs that, individually or taken
together with any other ERISA Events, results or could reasonably be expected to
result in a Material Adverse Change or the imposition of a Lien on any
Collateral.

 

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8.                   RIGHTS AND REMEDIES UPON AN EVENT OF DEFAULT

 

8.1.              Rights and Remedies. While an Event of Default occurs and
continues, the Collateral Agent may, or at the request of the Required Lenders,
will, without notice or demand:

 

(a)                 declare all Obligations (including, for the avoidance of
doubt, the Makewhole Amount or Prepayment Premium that is payable pursuant to
Section 2.2(e) and Section 2.2(f), as applicable) immediately due and payable
(but if an Event of Default described in Section 7.5 occurs all Obligations,
including the Makewhole Amount and Prepayment Premium that is payable pursuant
to Section 2.2(e) and Section 2.2(f), as applicable, are automatically and
immediately due and payable without any action by the Collateral Agent or any
Lender), whereupon all Obligations for principal, interest, premium or otherwise
(including, for the avoidance of doubt, the Makewhole Amount and Prepayment
Premium that is payable pursuant to Section 2.2(e) and Section 2.2(f), as
applicable) shall become due and payable by Borrower without presentment,
demand, protest or other notice of any kind, which are all expressly waived by
the Credit Parties hereby;

 

(b)                stop advancing money or extending credit for Borrower’s
benefit under this Agreement;

 

(c)                 settle or adjust disputes and claims directly with Account
Debtors for amounts on terms and in any order that the Collateral Agent
considers advisable, notify any Person owing Borrower money of the Collateral
Agent’s security interest, for the benefit of the Lenders and the other Secured
Parties, in such funds, and verify the amount of the Collateral Accounts;

 

(d)                make any payments and do any acts it considers necessary or
reasonable to protect the Collateral or the Collateral Agent’s security
interest, for the benefit of Lenders and the other Secured Parties, in the
Collateral. Borrower shall assemble the Collateral if the Collateral Agent or
the Required Lenders requests and make it available as the Collateral Agent
designates or the Required Lenders designate. The Collateral Agent or its agents
or representatives may enter premises where the Collateral is located, take and
maintain possession of any part of the Collateral, and pay, purchase, contest,
or compromise any Lien that appears to be prior or superior to its security
interest, for the benefit of Lenders and the other Secured Parties, and pay all
expenses incurred. Borrower grants the Collateral Agent a license to enter and
occupy (and for its agents or representatives to enter and occupy) any of its
premises, without charge, to exercise any of the Collateral Agent’s or any
Lender’s rights or remedies;

 

(e)                 apply to the Obligations (i) any balances and deposits of
Borrower it holds, or (ii) any amount held by the Collateral Agent owing to or
for the credit or the account of Borrower;

 

(f)                  ship, reclaim, recover, store, finish, maintain, repair,
prepare for sale, advertise for sale, and sell the Collateral. With respect to
any and all Intellectual Property owned by any Credit Party and included in
Collateral, each Credit Party hereby grants to the Collateral Agent, for the
benefit of Lenders and the other Secured Parties, as of the Closing Date, a
non-exclusive, royalty-free license or other right to use, without charge, such
Intellectual Property in advertising for sale and selling any Collateral and, in
connection with the Collateral Agent’s exercise of its rights under this Section
8.1, Borrower’s rights under all licenses and all franchise Contracts inure to
the benefit of all Secured Parties. Each Credit Party shall retain the right to
control the Collateral Agent’s use of its trade names and Trademarks and such
trade names and Trademarks, together with the goodwill associated therewith, are
and remain the exclusive property of the Credit Parties, and any and all use of
the same by the Collateral Agent shall inure to the benefit of the Credit
Parties;

 

(g)                place a “hold” on any account maintained with the Collateral
Agent or deliver a notice of exclusive control, any entitlement order, or other
directions or instructions pursuant to any Control Agreement or similar
agreements providing control of any Collateral;

 

(h)                demand and receive possession of Borrower’s Books regarding
Collateral; and

 

(i)                  exercise all rights and remedies available to the
Collateral Agent or any Lender under the Collateral Documents or any other Loan
Documents or at law or equity, including all remedies provided under the Code
(including disposal of the Collateral pursuant to the terms thereof).

 

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The Collateral Agent and each Lender agrees that in connection with any
foreclosure or other exercise of rights under this Agreement or any other Loan
Document with respect to any Intellectual Property included in the Collateral,
the rights of the licensees under any license of such Intellectual Property will
not be terminated, limited or otherwise adversely affected so long as no default
exists thereunder in a way that would permit the licensor to terminate such
license (commonly termed a non-disturbance). Without limitation to any other
provision herein or in any other Loan Document, while an Event of Default occurs
and continues, at the Collateral Agent’s or the Required Lenders’ request,
Borrower shall, promptly following the receipt of such request, take such
actions as are required or necessary to allow the Collateral Agent to collect,
receive, appropriate and realize upon Borrower’s rights and interests in, to and
under any Current Company IP Agreement or Current Acquisition IP Agreement,
including in connection with any foreclosure or other exercise of the Collateral
Agent’s or any Lender’s rights with respect thereto (including, for the
avoidance of doubt, using reasonable best efforts to obtain the written consent
of any counterparty to the exercise by the Collateral Agent or any Lender of any
and all rights and remedies under this Agreement or any other Loan Document with
respect to any Current Company IP Agreement or Current Acquisition IP Agreement,
in form and substance reasonably satisfactory to the Collateral Agent).

 

8.2.              Power of Attorney. Borrower hereby irrevocably appoints the
Collateral Agent and any Related Party thereof as its lawful attorney-in-fact,
exercisable upon the occurrence and during the continuance of an Event of
Default, to: (a) endorse Borrower’s name on any checks or other forms of payment
or security; (b) sign Borrower’s name on any invoice or bill of lading for any
Account or drafts against Account Debtors; (c) settle and adjust disputes and
claims about the Collateral Accounts directly with depository banks where the
Collateral Accounts are maintained, for amounts and on terms the Collateral
Agent determines reasonable; (d) make, settle, and adjust all claims under
Borrower’s products liability or general liability insurance policies maintained
in the United States regarding Collateral; (e) pay, contest or settle any Lien,
charge, encumbrance, security interest, and adverse claim in or to the
Collateral, or any judgment based thereon, or otherwise take any action to
terminate or discharge the same; and (f) transfer the Collateral into the name
of the Collateral Agent or a third party as the Code permits. Borrower hereby
appoints the Collateral Agent and any Related Party thereof as its lawful
attorney-in-fact to file or record any documents necessary to perfect or
continue the perfection of the Collateral Agent’s security interest, for the
benefit of Lenders and the other Secured Parties, in the Collateral regardless
of whether an Event of Default has occurred until all Obligations (other than
inchoate indemnity obligations) have been satisfied in full and no Lender is
under any further obligation to make Credit Extensions hereunder. The foregoing
appointment of the Collateral Agent and any Related Party thereof as Borrower’s
attorney in fact, and all of the Collateral Agent’s (or such Related Party’s)
rights and powers, coupled with an interest, are irrevocable until all
Obligations (other than inchoate indemnity obligations) have been fully repaid
and performed and each Lender’s obligation to provide Credit Extensions
terminates.

 

8.3.              Application of Payments and Proceeds Upon Default. If an Event
of Default has occurred and is continuing, the Collateral Agent shall apply any
funds in its possession, whether from Borrower account balances, payments,
proceeds realized as the result of any collection of Collateral Accounts or
disposition of any other Collateral, or otherwise, to the Obligations in such
order as the Collateral Agent shall determine in its sole discretion. Any
surplus shall be paid to Borrower or other Persons legally entitled thereto;
Borrower shall remain liable to Lenders for any deficiency. If the Collateral
Agent or any Lender directly or indirectly enters into a deferred payment or
other credit transaction with any purchaser at any sale of Collateral, the
Collateral Agent or such Lender, as applicable, shall have the option,
exercisable at any time, of either reducing the Obligations by the principal
amount of the purchase price or deferring the reduction of the Obligations until
the actual receipt by the applicable Lender(s) of cash therefor.

 

8.4.              Collateral Agent’s Liability for Collateral. So long as the
Collateral Agent complies with Requirements of Law regarding the safekeeping of
the Collateral in the possession or under the control of the Collateral Agent,
the Collateral Agent shall not be liable or responsible for: (a) the safekeeping
of the Collateral; (b) any loss or damage to the Collateral; or (c) any act or
default of any other Person. In no event shall the Collateral Agent or any
Lender have any liability for any diminution in the value of the Collateral for
any reason. Borrower bears all risk of loss, damage or destruction of the
Collateral.

 

39

 

 

8.5.              No Waiver; Remedies Cumulative. The Collateral Agent’s or any
Lender’s failure, at any time or times, to require strict performance by
Borrower of any provision of this Agreement or any other Loan Document shall not
waive, affect, or diminish any right of the Collateral Agent or any Lender
thereafter to demand strict performance and compliance herewith or therewith. No
waiver hereunder shall be effective unless signed by the party granting the
waiver and then is only effective for the specific instance and purpose for
which it is given. Each of the Collateral Agent’s and Lender’s rights and
remedies under this Agreement and the other Loan Documents are cumulative. Each
of the Collateral Agent and Lenders has all rights and remedies provided under
the Code, by law, or in equity. The exercise by the Collateral Agent or any
Lender of one right or remedy is not an election and shall not preclude the
Collateral Agent or any Lender from exercising any other remedy under this
Agreement or other remedy available at law or in equity, and the waiver by the
Collateral Agent or any Lender of any Event of Default is not a continuing
waiver. The Collateral Agent’s or any Lender’s delay in exercising any remedy is
not a waiver, election, or acquiescence.

 

8.6.              Demand Waiver; Makewhole Amount; Prepayment Premium. Borrower
waives demand, notice of default or dishonor, notice of payment and nonpayment,
notice of any default, nonpayment at maturity, release, compromise, settlement,
extension, or renewal of accounts, documents, instruments, chattel paper, and
guarantees held by the Collateral Agent on which Borrower is liable. Borrower
acknowledges and agrees that if the maturity of all Obligations shall be
accelerated pursuant to Section 8.1(a) by reason of the occurrence of an Event
of Default, the applicable Makewhole Amount and Prepayment Premium that is
payable pursuant to Section 2.2(e) and Section 2.2(f) shall become due and
payable by Borrower upon such acceleration, whether such acceleration is
automatic or is effected by the Collateral Agent’s or any Lender’s declaration
thereof, as provided in Section 8.1(a), and Borrower shall pay the applicable
Makewhole Amount and Prepayment Premium that is payable pursuant to Section
2.2(e) and Section 2.2(f) as compensation to Lenders for the loss of its
investment opportunity and not as a penalty, and Borrower waives any right to
object thereto in any voluntary or involuntary bankruptcy, insolvency or similar
proceeding or otherwise.

 

9.                   NOTICES

 

All notices, consents, requests, approvals, demands, or other communication by
any party to this Agreement or any other Loan Document must be in writing and
shall be deemed to have been validly served, given, or delivered: (a) upon the
earlier of actual receipt and three (3) Business Days after deposit in the U.S.
mail, first class, registered or certified mail return receipt requested, with
proper postage prepaid; (b) upon transmission, when sent by electronic mail or
facsimile transmission; (c) one (1) Business Day after deposit with a reputable
overnight courier with all charges prepaid; or (d) when delivered, if
hand-delivered by messenger, all of which shall be addressed to the party to be
notified and sent to the address, facsimile number, or email address (if any)
indicated below. Any party to this Agreement may change its mailing or
electronic mail address or facsimile number by giving all other parties hereto
written notice thereof in accordance with the terms of this Section 9.

 

40

 

 

  If to Borrower or any other Credit Party:       Collegium Pharmaceutical, Inc.
  100 Technology Center Drive, Suite 300   Stoughton, MA 02072   Attention: Paul
Brannelly   Telephone: (781) 713-3699   Email: pbrannelly@collegiumpharma.com  
    with a copy to:       Collegium Pharmaceutical, Inc.   100 Technology Center
Drive, Suite 300   Stoughton, MA 02072   Attention: Shirley Kuhlmann  
Telephone: (781) 232-0774   Email: skuhlmann@collegiumpharma.com            
with a copy to (which shall not constitute notice) to:       Pepper Hamilton LLP
  3000 Two Logan Square   Philadelphia, PA 19103   Attn: Jen Porter  
Telephone:  (215) 981-4339   Facsimile: (215) 981-4750   Email:
porterj@pepperlaw.com       If to the Collateral Agent:       BioPharma Credit
PLC   c/o Beaufort House   51 New North Road   Exeter EX4 4EP   United Kingdom  
Attn:  Company Secretary   Tel: +44 01 392 477 500   Fax:  +44 01 392 253 282  
Email:  pharmakon@Pharmakonadvisors.com       with copies (which shall not
constitute notice) to:       Pharmakon Advisors LP   110 East 59th Street, #3300
  New York, NY 10022   Attn:  Pedro Gonzalez de Cosio   Phone: +1 (212) 883-2296
  Fax: +1 (917) 210-4048   Email:  pg@PharmakonAdvisors.com       and       Akin
Gump Strauss Hauer & Feld LLP   One Bryant Park   New York, NY 10036-6745  
Attn:  Geoffrey E. Secol   Phone: (212) 872-8081   Fax: (212) 872-1002  
Email:  gsecol@akingump.com       If to any Lender:   To the address set forth
on Exhibit E attached hereto.          

 

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10.                CHOICE OF LAW, VENUE, AND JURY TRIAL WAIVER

 

THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS AND ANY CLAIMS, CONTROVERSY, DISPUTE
OR CAUSE OF ACTION (WHETHER IN CONTRACT OR TORT OR OTHERWISE) BASED UPON,
ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT AND THE
TRANSACTIONS CONTEMPLATED HEREBY AND THEREBY SHALL BE GOVERNED BY, AND CONSTRUED
IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK. Each party hereto submits
to the exclusive jurisdiction of the courts of the State of New York sitting in
New York County, and of the United States District Court of the Southern
District of New York, and any appellate court from any thereof, and agrees that
all claims in respect of any such action, litigation or proceeding may be heard
and determined in such New York State court or, to the fullest extent permitted
by Requirements of Law, in such Federal court; provided, however, that nothing
in this Agreement shall be deemed to operate to preclude the Collateral Agent or
any Lender from bringing suit or taking other legal action in any other
jurisdiction to realize on the Collateral or any other security for the
Obligations, or to enforce a judgment or other court order in favor of the
Collateral Agent or any Lender. Each party hereto expressly submits and consents
in advance to such jurisdiction in any action or suit commenced in any such
court, and each party hereto hereby waives any objection that it may have based
upon lack of personal jurisdiction, improper venue, or forum non conveniens and
hereby consents to the granting of such legal or equitable relief as is deemed
appropriate by such court. Each party hereto hereby waives personal service of
the summons, complaints, and other process issued in such action or suit and
agrees that service of such summons, complaints, and other process may be made
by registered or certified mail addressed to such party at the address set forth
in (or otherwise provided in accordance with the terms of) Section 9 of this
Agreement and that service so made shall be deemed completed upon the earlier to
occur of such party’s actual receipt thereof or three (3) days after deposit in
the U.S. mails, proper postage prepaid.

 

TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, EACH PARTY HERETO WAIVES ITS
RIGHT TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION ARISING OUT OF OR BASED
UPON THIS AGREEMENT, THE LOAN DOCUMENTS OR ANY CONTEMPLATED TRANSACTION,
INCLUDING CONTRACT, TORT, BREACH OF DUTY AND ALL OTHER CLAIMS. THIS WAIVER IS A
MATERIAL INDUCEMENT FOR ALL PARTIES HERETO TO ENTER INTO THIS AGREEMENT. EACH
PARTY HERETO HAS REVIEWED THIS WAIVER WITH ITS COUNSEL.

 

11.                GENERAL PROVISIONS

 

11.1.           Successors and Assigns.

 

(a)                 This Agreement binds and is for the benefit of the parties
hereto and their respective successors and permitted assigns.

 

(b)                No Credit Party may transfer, pledge or assign this Agreement
or any other Loan Document or any rights or obligations hereunder or thereunder
without the prior written consent of each Lender. Subject to clause (d) below,
each Lender may at any time sell, transfer, assign or pledge this Agreement or
any other Loan Document or any of its rights or obligations hereunder or
thereunder, or grant a participation in all or any part of, or any interest in,
such Lender’s obligations, rights or benefits under this Agreement and the other
Loan Documents, including with respect to any Term Loan (or any portion
thereof), to any other Lender, any Affiliate of any Lender or any third party
(any such sale, transfer, assignment, pledge or grant of a participation, a
“Lender Transfer”).

 

(c)                 In the case of a Lender Transfer in the form of a
participation granted by any Lender to any third party, (i) such Lender’s
obligations under this Agreement shall remain unchanged, (ii) such Lender shall
remain solely responsible to the other parties hereto for the performance of its
obligations hereunder, (iii) Borrower shall continue to deal solely and directly
with such Lender in connection with such Lender’s rights and obligations under
this Agreement and (iv) any agreement or instrument pursuant to which such
Lender sells such participation shall provide that such Lender shall retain the
sole right to enforce this Agreement and to approve any amendment, restatement
or other modification hereto, subject, in each case described in clauses (i)
through (iv) above, to the terms and conditions of this Agreement. Borrower
agrees that each participant shall be entitled to the benefits of Sections 2.5
and 2.6 (subject to the requirements and limitations therein, including the
requirements under Section 2.6(d) (it being understood that the documentation
required under Section 2.6(d) shall be delivered to the applicable Lender)) to
the same extent as if it were a Person that had acquired its interest by
assignment pursuant to clause (b) above; provided that, with respect to any
participation, such participant shall not be entitled to receive any greater
payment under Sections 2.5 or 2.6 than the applicable Lender (i.e., the party
that participated the interest) would have been entitled to receive, except to
the extent of any entitlement to receive a greater payment resulting from a
Change in Law that occurs after such participant acquired the applicable
participation.

 

(d)                No Lender shall make a Lender Transfer to a Competitor of
Borrower, unless an Event of Default has occurred and is continuing.

 

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(e)                 The Collateral Agent shall record any Lender Transfer in the
Register. Each Lender shall provide Borrower and the Collateral Agent with
written notice of a Lender Transfer delivered no later than five (5) Business
Days prior to the date on which such Lender Transfer is consummated. For the
avoidance of doubt, if any Lender sells a participation, such Lender shall,
acting solely for this purpose as a non-fiduciary agent of Borrower, maintain a
register on which it enters the name and address of each participant and
principal amounts (and stated interest) of each participant’s interest in the
Term Loan(s) or other obligations under the Loan Documents (the “Participant
Register”); provided, however, that such Lender shall have no obligation to
disclose all or any portion of the Participant Register (including the identity
of any participant or any information relating to a participant’s interest in
any commitments, loans or its other obligations under any Loan Document) to any
Person except to the extent that such disclosure is necessary to establish that
such commitment, loan, letter of credit or other obligation is in registered
form under Section 5f.103-1(c) or Proposed Section 1.163-5(b) of the Treasury
Regulations (or any amended or successor version thereof), or as otherwise
required thereunder. The entries in the Participant Register shall be conclusive
absent manifest error, and the Collateral Agent and each Lender shall treat each
Person whose name is recorded in the Participant Register as the owner of such
participation for all purposes of this Agreement notwithstanding any notice to
the contrary.

 

(f)                  Any attempted transfer, pledge or assignment of this
Agreement or any other Loan Document or any rights or obligations hereunder or
thereunder in violation of this Section 11.1 shall be null and void ab initio
and of no effect.

 

11.2.           Indemnification.

 

(a)                 Each of the Credit Parties agrees to indemnify and hold
harmless each of the Collateral Agent, Lenders and its and their respective
Affiliates (and its or their respective successors and assigns) and each
manager, member, partner, controlling Person, director, officer, employee, agent
or sub-agent, advisor and affiliate thereof (each such Person, an “Indemnified
Person”) from and against any and all Indemnified Liabilities; provided,
however, that: (i) no Credit Party shall have any obligation to any Indemnified
Person hereunder with respect to any Indemnified Liabilities to the extent such
Indemnified Liabilities arise from the bad faith, gross negligence or willful
misconduct of that Indemnified Person (or its Affiliates or controlling Persons
or their respective directors, officers, managers, partners, members, agents,
sub-agents or advisors), as determined by a final, non-appealable judgment of a
court of competent jurisdiction; (ii) no Credit Party shall have any obligation
to any Indemnified Person hereunder with respect to any Indemnified Liabilities
if and to the extent such Indemnified Liabilities arise from a material breach
of any obligation of such Indemnified Person hereunder; (iii) no Credit Party
shall have any obligation to any Indemnified Person hereunder with respect to
any Indemnified Liabilities if and to the extent such Indemnified Liabilities
arise from any claim by one Indemnified Person against another Indemnified
Person that does not relate to any act or omission of any Credit Party; and (iv)
no Credit Party shall be liable for any settlement of any claim or proceeding
effected by any Indemnified Person without the prior written consent of such
Credit Party (which consent shall not be unreasonably withheld, conditioned or
delayed), but if settled with such consent or if there shall be a final judgment
against an Indemnified Person, each of the Credit Parties shall, jointly and
severally with each other Credit Parties, indemnify and hold harmless such
Indemnified Person from and against any loss or liability by reason of such
settlement or judgment in the manner set forth in this Agreement. This Section
11.2(a) shall not apply with respect to Taxes other than any Taxes that
represent liabilities, obligations, losses, damages, penalties, claims, costs,
expenses and disbursements arising from any non-Tax claim.

 

(b)                To the extent permitted by Requirements of Law, no party to
this Agreement shall assert, and each party to this Agreement hereby waives, any
claim against any other party hereto (and its or their successors and assigns),
and each manager, member, partner, controlling Person, director, officer,
employee, agent or sub-agent, advisor and affiliate thereof, on any theory of
liability, for special, indirect, consequential or punitive damages (as opposed
to direct or actual damages) (whether or not the claim therefor is based on
contract, tort or duty imposed by any applicable legal requirement) arising out
of, in connection with, arising out of, as a result of, or in any way related
to, this Agreement or any Loan Document or any agreement or instrument
contemplated hereby or thereby or referred to herein or therein, the
transactions contemplated hereby or thereby, the Term Loans or the use of the
proceeds thereof or any act or omission or event occurring in connection
therewith, and each party to this Agreement hereby waives, releases and agrees
not to sue upon any such claim or any such damages, whether or not accrued and
whether or not known or suspected to exist in its favor.

 

(c)                 Any action taken by any Credit Party under or with respect
to any Loan Document, even if required under any Loan Document or at the request
of the Collateral Agent or any Lender, shall be at the expense of such Credit
Party, and neither the Collateral Agent nor any Secured Party shall be required
under any Loan Document to reimburse any Credit Party or any Subsidiary of any
Credit Party therefor except as expressly provided therein. In addition, and
without limiting the generality of Section 2.4, Borrower agrees to pay or
reimburse upon demand each of the Collateral Agent and Lenders (and their
respective successors and assigns) and each of their respective Related Parties
for any and all fees, expenses and disbursements of the kind or nature described
in clause (ii) of the definition of “Lender Expenses” incurred by it.

 

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11.3.           Severability of Provisions. In case any provision in or
obligation hereunder or under any other Loan Document shall be invalid, illegal
or unenforceable in any jurisdiction, the validity, legality and enforceability
of the remaining provisions or obligations, or of such provision or obligation
in any other jurisdiction, shall not in any way be affected or impaired thereby.

 

11.4.           Correction of Loan Documents. The Collateral Agent or Required
Lenders may correct patent errors and fill in any blanks in the Loan Documents
consistent with the agreement of the parties hereto so long as the Collateral
Agent or Required Lenders, as applicable, provides the Credit Parties and the
other parties hereto with written notice of such correction and allows the
Credit Parties at least ten (10) days to object to such correction in writing
delivered to the Collateral Agent and each Lender. In the event of such
objection, such correction shall not be made except by an amendment to this
Agreement in accordance with Section 11.5.

 

11.5.           Amendments in Writing; Integration.

 

(a)                 No amendment, restatement or modification of any provision
of this Agreement or any other Loan Document, or waiver, discharge or
termination of any obligation hereunder or thereunder, no approval or consent
hereunder or thereunder (including any consent to any departure by Borrower or
any other Credit Party herefrom or therefrom), shall in any event be effective
unless the same shall be in writing and signed by Borrower (on its own behalf
and on behalf of each other Credit Party) and the Required Lenders; provided,
however, that no such amendment, restatement, modification, waiver, discharge,
termination, approval or consent shall, unless in writing and signed by the
Collateral Agent and the Required Lenders, affect the rights or duties of, or
any amounts payable to, the Collateral Agent under this Agreement or any other
Loan Document. Any such waiver, approval or consent granted shall be limited to
the specific circumstance expressly described in it, and shall not apply to any
subsequent or other circumstance, whether similar or dissimilar, or give rise
to, or evidence, any obligation or commitment to grant any further waiver,
approval or consent.

 

(b)                This Agreement and the Loan Documents represent the entire
agreement about this subject matter and supersede prior negotiations or
agreements. All prior agreements, understandings, representations, warranties,
and negotiations among the parties hereto about the subject matter of this
Agreement and the Loan Documents merge into this Agreement and the Loan
Documents.

 

11.6.           Counterparts. This Agreement may be executed in any number of
counterparts and by different parties on separate counterparts, each of which,
when executed and delivered, is an original, and all taken together, constitute
one Agreement.

 

11.7.           Survival. All covenants, representations and warranties made in
this Agreement continue in full force and effect until all Obligations (other
than inchoate indemnity obligations and any other obligations that, by their
terms, are to survive the termination of this Agreement) have been paid in full
and satisfied. The obligation of Borrower or any other the Credit Parties in
Section 2.4 to pay or reimburse Lender Expenses, in Section 2.6 with respect to
Taxes and withholding and in Section 11.2 to indemnify Indemnified Persons shall
survive until the statute of limitations with respect to such claim or cause of
action shall have run.

 

11.8.           Confidentiality. Any information regarding the Credit Parties
and their Subsidiaries and their businesses provided to the Collateral Agent or
any Lender by or on behalf of any Credit Party pursuant to the Loan Documents
shall be deemed “Confidential Information”; provided, however, that Confidential
Information does not include information that is either: (i) in the public
domain or in the possession of the Collateral Agent, any Lender or any of their
respective Affiliates prior to the disclosure hereunder thereto, or becomes part
of the public domain after the disclosure hereunder thereto, other than as a
result of a breach by the Collateral Agent, any Lender or any of their
respective Affiliates of the obligations under this Section 11.8; or (ii)
disclosed to the Collateral Agent, any Lender or any of their respective
Affiliates by a third party if the Collateral Agent, such Lender or such
Affiliate, as applicable, does not know that the third party is prohibited from
disclosing the information. Neither the Collateral Agent nor any Lender shall
disclose any Confidential Information to a third party or use Confidential
Information for any purpose other than the exercise of its rights and the
performance of its duties or obligations under the Loan Documents. The foregoing
in this Section 11.8 notwithstanding, the Collateral Agent and each Lender may
disclose Confidential Information: (a) to any of its Subsidiaries or Affiliates;
(b) to prospective transferees, purchasers or participants of any interest in
the Credit Extensions (including, for the avoidance of doubt, in connection with
any proposed Lender Transfer); (c) as required by law, regulation, subpoena, or
other order, provided, that (x) prior to any disclosure under this clause (c),
the Collateral Agent or such Lender, as applicable, agrees to endeavor to
provide Borrower with prior written notice thereof and with respect to any law,
regulation, subpoena or other order, to the extent that the Collateral Agent or
such Lender is permitted to provide such prior notice to Borrower pursuant to
the terms hereof, and (y) any disclosure under this clause (c) shall be limited
solely to that portion of the Confidential Information as may be specifically
compelled by such law, regulation, subpoena or other order; (d) to the extent
requested by regulators having jurisdiction over the Collateral Agent or such
Lender or as otherwise required in connection with the Collateral Agent’s or
such Lender’s examination or audit by such regulators; (e) as the Collateral
Agent or such Lender considers reasonably necessary in exercising remedies under
the Loan Documents; (f) to third-party service providers of the Collateral Agent
or such Lender; and (g) to any of the Collateral Agent’s or such Lender’s
Related Parties; provided, however, that the third parties to which Confidential
Information is disclosed pursuant to clauses (a), (b), (f) and (g) are bound by
obligations of confidentiality and non-use that are no less restrictive than
those contained herein.

 

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The provisions of this Section 11.8 shall survive the termination of this
Agreement.

 

11.9.           Attorneys’ Fees, Costs and Expenses. In any action or proceeding
between any Credit Party and the Collateral Agent or any Lender arising out of
or relating to the Loan Documents, the prevailing party shall be entitled to
recover its reasonable attorneys’ fees and other costs and expenses incurred, in
addition to any other relief to which it may be entitled.

 

11.10.        Right of Set-Off. In addition to any rights now or hereafter
granted under Requirements of Law and not by way of limitation of any such
rights, upon the occurrence of an Event of Default and at any time thereafter
during the continuance of any Event of Default, each Lender is hereby authorized
by each Credit Party at any time or from time to time, without prior notice to
any Credit Party, any such notice being hereby expressly waived by Borrower (on
its own behalf and on behalf of each other Credit Party), to set off and to
appropriate and to apply any and all deposits (general or special, including
Indebtedness evidenced by certificates of deposit, whether matured or unmatured,
but not including trust accounts) and any other Indebtedness at any time held or
owing by such Lender to or for the credit or the account of any Credit Party
against and on account of the obligations and liabilities of any Credit Party to
such Lender hereunder and under the other Loan Documents, including all claims
of any nature or description arising out of or connected hereto or with any
other Loan Document, irrespective of whether or not (a) the Collateral Agent or
such Lender shall have made any demand hereunder or (b) the principal of or the
interest on the Term Loans or any other amounts due hereunder shall have become
due and payable pursuant to Section 2 and although such obligations and
liabilities, or any of them, may be contingent or unmatured. Each Lender agrees
promptly to notify Borrower and the Collateral Agent after any such set off and
application made by such Lender; provided, that the failure to give such notice
shall not affect the validity of such set off and application.

 

11.11.        Marshalling; Payments Set Aside. Neither the Collateral Agent nor
any Lender shall be under any obligation to marshal any assets in favor of any
Credit Party or any other Person or against or in payment of any or all of the
Obligations. To the extent that any Credit Party makes a payment or payments to
any Lender, or the Collateral Agent or any Lender enforces any Liens or
exercises its rights of setoff, and such payment or payments or the proceeds of
such enforcement or setoff or any part thereof are subsequently invalidated,
declared to be fraudulent or preferential, set aside or required to be repaid to
a trustee, receiver or any other party under any bankruptcy law, any other state
or federal law, common law or any equitable cause, then, to the extent of such
recovery, the obligation or part thereof originally intended to be satisfied,
and all Liens, rights and remedies therefor or related thereto, shall be revived
and continued in full force and effect as if such payment or payments had not
been made or such enforcement or setoff had not occurred.

 

11.12.        Electronic Execution of Documents. The words “execution,”
“signed,” “signature” and words of like import in any Loan Document shall be
deemed to include electronic signatures or the keeping of records in electronic
form, each of which shall be of the same legal effect, validity and
enforceability as a manually executed signature or the use of a paper-based
recordkeeping systems, as the case may be, to the extent and as provided for in
any Requirements of Law, including any state law based on the Uniform Electronic
Transactions Act.

 

11.13.        Captions. Section headings herein are included herein for
convenience of reference only and shall not constitute a part hereof for any
other purpose or be given any substantive effect.

 

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11.14.        Construction of Agreement. The parties hereto mutually acknowledge
that they and their respective attorneys have participated in the preparation
and negotiation of this Agreement. In cases of uncertainty, this Agreement shall
be construed without regard to which of the parties hereto caused the
uncertainty to exist.

 

11.15.        Third Parties. Nothing in this Agreement, whether express or
implied, is intended to: (a) except as expressly provided in Section 11.2(a),
confer any benefits, rights or remedies under or by reason of this Agreement on
any Persons other than the express parties to it and their respective successors
and permitted assigns; (b) relieve or discharge the obligation or liability of
any Person not an express party to this Agreement; or (c) give any Person not an
express party to this Agreement any right of subrogation or action against any
party to this Agreement.

 

11.16.        No Advisory or Fiduciary Duty. The Collateral Agent and each
Lender may have economic interests that conflict with those of the Credit
Parties. Each Credit Party agrees that nothing in the Loan Documents or
otherwise will be deemed to create an advisory, fiduciary or agency relationship
or fiduciary or other implied duty between any Lender or the Collateral Agent,
on the one hand, and such Credit Party, its Subsidiaries, and any of their
respective stockholders or affiliates, on the other hand. Each Credit Party
acknowledges and agrees that (i) the transactions contemplated by the Loan
Documents are arm’s-length commercial transactions between each Lender and the
Collateral Agent, on the one hand, and such Credit Party, its Subsidiaries and
their respective affiliates, on the other hand, (ii) in connection therewith and
with the process leading to such transaction, the Collateral Agent and each
Lender is acting solely as a principal and not the advisor, agent or fiduciary
of such Credit Party, its Subsidiaries or their respective affiliates,
management, stockholders, creditors or any other Person, (iii) neither the
Collateral Agent nor any Lender has assumed an advisory or fiduciary
responsibility in favor of any Credit Party, its Subsidiaries or their
respective affiliates with respect to the transactions contemplated hereby or
the process leading thereto (irrespective of whether the Collateral Agent or any
Lender or any of their respective affiliates has advised or is currently
advising such Credit Party, its Subsidiaries or their respective affiliates on
other matters) or any other obligation to such Credit Party, its Subsidiaries or
their respective affiliates except the obligations expressly set forth in the
Loan Documents and (iv) each Credit Party, its Subsidiaries and their respective
affiliates have consulted their own legal and financial advisors to the extent
each deemed appropriate. Each Credit Party further acknowledges and agrees that
it is responsible for making its own independent judgment with respect to such
transactions and the process leading thereto. Each Credit Party agrees that it
will not claim that the Collateral Agent or any Lender has rendered advisory
services of any nature or respect, or owes a fiduciary or similar duty to such
Credit Party, its Subsidiaries or their respective affiliates in connection with
such transaction or the process leading thereto.

 

12.                COLLATERAL AGENT

 

12.1.           Appointment and Authority. Each of the Lenders hereby
irrevocably appoints BioPharma Credit PLC to act on its behalf as the Collateral
Agent hereunder and under the other Loan Documents and authorizes the Collateral
Agent to take such actions on its behalf and to exercise such powers as are
delegated to the Collateral Agent by the terms hereof or thereof, together with
such actions and powers as are reasonably incidental thereto. Except for the
first two sentences of Section 12.6 and the penultimate paragraph of Section
12.8, the provisions of this Section 12 are solely for the benefit of the
Collateral Agent and the Lenders, and neither Borrower nor any other Credit
Party shall have rights as a third party beneficiary of any of such provisions.
Subject to Section 12.8 and Section 11.5, any action required or permitted to be
taken by the Collateral Agent hereunder shall be so taken with the prior
approval of the Required Lenders, except for such actions as are permitted in
the Loan Documents to be taken by the Collateral Agent.

 

12.2.           Rights as a Lender. The Person serving as the Collateral 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 the Collateral
Agent and the term “Lender” or “Lenders” shall, unless otherwise expressly
indicated or unless the context otherwise requires, include the Person serving
as the Collateral Agent hereunder in its individual capacity. Such Person and
its Affiliates may lend money to, own securities of, act as the financial
advisor or in any other advisory capacity for and generally engage in any kind
of business with Borrower or any Subsidiary or other Affiliate thereof as if
such Person were not the Collateral Agent hereunder and without any duty to
account therefor to the Lenders.

 

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12.3.           Exculpatory Provisions.

 

(a)                 The Collateral Agent shall not have any duties or
obligations to the Lenders except those expressly set forth herein and in the
other Loan Documents to which it is a party. Without limiting the generality of
the foregoing, with respect to the Lenders, the Collateral Agent:

 

(i)                  shall not be subject to any fiduciary or other implied
duties, regardless of whether a Default or Event of Default has occurred and is
continuing;

 

(ii)                shall not 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 to which it is a
party that the Collateral 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 such other Loan Documents),
provided that the Collateral Agent shall not be required to take any action
that, in its opinion or the opinion of its counsel, may expose the Collateral
Agent to liability or that is contrary to any Loan Document or Requirements of
Law; and

 

(iii)              shall not, except as expressly set forth herein and in the
other Loan Documents to which it is a party, 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 the Collateral Agent or any of its Affiliates in any capacity.

 

(b)                The Collateral Agent shall not be liable for any action taken
or not taken by it (i) 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 the Collateral Agent shall believe in good faith shall be
necessary, under the circumstances as provided in Section 11.5) or (ii) in the
absence of its own gross negligence or willful misconduct as determined by a
court of competent jurisdiction by final and nonappealable judgment. The
Collateral Agent shall be deemed not to have knowledge of any Default or Event
of Default unless and until notice describing such Default or Event of Default
is given to the Collateral Agent in writing by Borrower or a Lender.

 

(c)                 The Collateral Agent shall not 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
or Event of 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 3 or elsewhere herein, other than to confirm receipt of items expressly
required to be delivered to the Collateral Agent.

 

12.4.           Reliance by Collateral Agent. The Collateral 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. The Collateral 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. The Collateral Agent may consult with legal counsel (who may be
counsel for 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.

 

12.5.           Delegation of Duties. The Collateral 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 the
Collateral Agent. The Collateral 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 12 shall
apply to any such sub-agent and to the Related Parties of the Collateral Agent
and any such sub-agent. The Collateral Agent shall not be responsible for the
negligence or misconduct of any sub-agent except to the extent that a court of
competent jurisdiction determines in a final and nonappealable judgment that the
Collateral Agent acted with gross negligence or willful misconduct in the
selection of such sub-agent.

 

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12.6.           Resignation of Collateral Agent. The Collateral Agent may at any
time give notice of its resignation to the Lenders and Borrower. Upon the
receipt of any such notice of resignation, the Required Lenders shall have the
right, in consultation with Borrower so long as no Default or Event of Default
has occurred and is continuing, to appoint a successor. If no successor shall
have been so appointed by the Required Lenders and shall have accepted such
appointment within thirty (30) days after the retiring Collateral Agent gives
notice of its resignation, then the retiring Collateral Agent may, on behalf of
the Lenders, appoint a successor Collateral Agent; provided that, whether or not
a successor has been appointed or has accepted such appointment, such
resignation shall become effective upon delivery of the notice thereof. Upon the
acceptance of a successor’s appointment as Collateral Agent hereunder, such
successor shall succeed to and become vested with all of the rights, powers,
privileges and duties of the retiring (or retired) Collateral Agent, and the
retiring Collateral Agent shall be discharged from all of its duties and
obligations under the Loan Documents (if not already discharged therefrom as
provided above in this Section 12.6), other than its obligations under Section
11.8. After the retiring Collateral Agent’s resignation, the provisions of this
Section 12 and Section 10 shall continue in effect for the benefit of such
retiring Collateral 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 Collateral Agent was acting as Collateral Agent. Upon any resignation
by the Collateral Agent, all payments (if any), communications and
determinations provided to be made by, to or through the Collateral Agent shall
instead be made by, to or through each Lender (in the case of such payments and
communications) or the Required Lenders (in the case of such determinations)
directly, until such time as a Person accepts an appointment as Collateral Agent
in accordance with this Section 12.6.

 

12.7.           Non-Reliance on Collateral Agent and Other Lenders. Each Lender
acknowledges that it has, independently and without reliance upon the Collateral
Agent or any other Lender or any of their respective Related Parties and based
on such documents and information as it has deemed appropriate, made its own
credit analysis and decision to enter into this Agreement and make Credit
Extensions hereunder. Each Lender also acknowledges that it will, independently
and without reliance upon the Collateral Agent or any other Lender or any of
their respective Related Parties 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.

 

12.8.           Collateral and Guaranty Matters. Each Lender agrees that any
action taken by the Collateral Agent or the Required Lenders in accordance with
the provisions of this Agreement or of the other Loan Documents, and the
exercise by the Collateral Agent or Required Lenders of the powers set forth
herein or therein, together with such other powers as are reasonably incidental
thereto, shall be authorized and binding upon all of the Lenders. Without
limiting the generality of the foregoing, the Lenders irrevocably authorize the
Collateral Agent, at its option and in its discretion, and the Collateral Agent
agrees:

 

(a)                 to release any Lien on any property granted to or held by
the Collateral Agent under any Collateral Document (i) upon payment in full of
the Obligations (other than inchoate indemnity obligations), (ii) that is sold,
transferred, disposed or to be sold, transferred, disposed as part of or in
connection with any sale, transfer or other disposition (other than any sale to
a Credit Party) permitted hereunder, (iii) subject to Section 11.5, if approved,
authorized or ratified in writing by the Required Lenders, or (iv) to the extent
such property is owned by a Guarantor upon the release of such Guarantor from
its obligations under the Loan Documents pursuant to clause (c) below;

 

(b)                to subordinate any Lien on any property granted to or held by
the Collateral Agent under any Loan Document to the holder of any Lien on such
property that is permitted by clause (d), (i), (n), (o), (q) and (t) of the
definition of “Permitted Liens” (solely with respect to modifications,
replacements, extensions or renewals of Liens permitted under clause (d), (i),
(n), (o) and (q) of the definition of “Permitted Liens”);

 

(c)                 to release any Guarantor from its obligations under the Loan
Documents if such Person ceases to be a Subsidiary (or becomes an Excluded
Subsidiary) as a result of a transaction permitted hereunder or upon payment in
full of the Obligations (other than inchoate indemnity obligations);

 

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(d)                to enter into non-disturbance and similar agreements in
connection with the licensing of Intellectual Property permitted pursuant to the
terms of this Agreement; and

 

(e)                 to enter into a subordination, intercreditor, or other
similar agreement with respect to any Indebtedness that constitutes Subordinated
Debt to the extent such Subordinated Debt is permitted under the definition of
“Permitted Indebtedness”.

 

Upon request by the Collateral Agent at any time the Required Lenders will
confirm in writing the Collateral Agent’s authority to release or subordinate
its interest in particular types or items of property, or to release any
Guarantor from its obligations under the Security Agreement pursuant to this
Section 12.8.

 

In each case specified in this Section 12.8, the Collateral Agent will (and each
Lender irrevocably authorizes the Collateral Agent to), at Borrower’s expense:
(A) deliver to Borrower any Collateral in the Collateral Agent’s possession in
connection with the release of the Collateral Agent’s Lien thereon; and (B)
execute and deliver to the applicable Credit Party such documents as such Credit
Party may reasonably request (i) to evidence the release or subordination of
such item of Collateral from the Liens and security interests granted under the
Collateral Documents, (ii) to enter into non-disturbance or similar agreements
in connection with the licensing of Intellectual Property, (iii) to enter into a
subordination, intercreditor, or other similar agreement with respect to any
Indebtedness that constitutes Subordinated Debt to the extent such Subordinated
Debt is permitted under the definition of “Permitted Indebtedness” or (iv) to
evidence the release of any Guarantor from its obligations under the Loan
Documents, in each case, in accordance with the terms and conditions of the Loan
Documents (including this Section 12.8) and in form and substance reasonably
acceptable to the Collateral Agent.

 

Without limiting the generality of Section 12.10 below, the Collateral Agent
shall deliver to the Lenders notice of any action taken by it under this Section
12.8 promptly after the taking thereof; provided that delivery of or failure to
deliver any such notice shall not affect the Collateral Agent’s rights, powers,
privileges and protections under this Section 12.

 

12.9.           Reimbursement by Lenders. To the extent that Borrower for any
reason fails to indefeasibly pay any amount required under Section 2.4 to be
paid by it to the Collateral Agent (or any sub-agent thereof) or any Related
Party of any of the foregoing, each Lender severally agrees to pay to the
Collateral Agent (or any such sub-agent) or such Related Party, as the case may
be, such Lender’s pro rata share (based upon the percentages as used in
determining the Required Lenders 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, damage, liability or related expense,
as the case may be, was incurred by or asserted against the Collateral Agent (or
any such sub-agent) in its capacity as such or against any Related Party of any
of the foregoing acting for the Collateral Agent (or any sub-agent) in
connection with such capacity.

 

12.10.        Notices and Items to Lenders. The Collateral Agent shall deliver
to the Lenders each notice, report, statement, approval, direction, consent,
exemption, authorization, waiver, certificate, filing or other item received by
it pursuant to this Agreement or any other Loan Document (including any item
received by it pursuant to Section 3 or set forth on Schedule 5.14 of the
Disclosure Letter); provided, that any delivery of or failure to deliver any
such notice, report, statement, approval, direction, consent, exemption,
authorization, waiver, certificate, filing or item shall not otherwise alter or
effect the rights of the Lenders or the Collateral Agent under this Agreement or
any other Loan Document or the validity of such item. In addition, to the extent
the Collateral Agent or the Required Lenders deliver any notices, approvals,
authorizations, directions, consents or waivers to Borrower pursuant to this
Agreement or any other Loan Document, the Collateral Agent or the Required
Lenders, as applicable, will also deliver such notice, approval, authorization,
direction, consent or waiver to the other Lenders on or about the same time such
notice, approval, authorization, direction, consent or waiver is provided to
Borrower; provided, that the delivery of or failure to deliver such notice,
approval, authorization, direction, consent or waiver to the other Lenders shall
not in any way effect the obligations of Borrower, or the rights of the
Collateral Agent or the Required Lenders, in respect of such notice, approval,
authorization, direction, consent or waiver or the validity thereof.

 

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13.             DEFINITIONS

 

13.1.           Definitions. For the purposes of and as used in the Loan
Documents: (a) references to any Person include its successors and assigns and,
in the case of any Governmental Authority, any Person succeeding to its
functions and capacities; (b) except as the context otherwise requires
(including to the extent otherwise expressly provided in any Loan Document), (i)
references to any law, statute, treaty, order, policy, rule or regulation
include any amendments, supplements and successors thereto and (ii) references
to any contract, agreement, instrument or other document include any amendments,
restatements, supplements or modifications thereto or thereof from time to time
to the extent permitted by the provisions thereof; (c) the word “shall” is
mandatory; (d) the word “may” is permissive; (e) the word “or” has the inclusive
meaning represented by the phrase “or”; (f) the words “include”, “includes” and
“including” are not limiting; (g) the singular includes the plural and the
plural includes the singular; (h) numbers denoting amounts that are set off in
parentheses are negative unless the context dictates otherwise; (i) each
authorization herein shall be deemed irrevocable and coupled with an interest;
(j) all accounting terms shall be interpreted, and all determinations relating
thereto shall be made, in accordance with Applicable Accounting Standards; (k)
references to any time of day shall be to New York time; (l) the words “herein”,
“hereof”, “hereby”, “hereto” and “hereunder” refer to this Agreement as a whole;
and (m) unless otherwise expressly provided, references to specific sections,
articles, clauses, sub-clauses, annexes and exhibits are to this Agreement and
references to specific schedules are to the Disclosure Letter. As used in this
Agreement, the following capitalized terms have the following meanings:

 

“Account” means any “account” as defined in the Code with such additions to such
term as may hereafter be made, and includes all accounts receivable, book debts,
and other sums owing to Credit Parties.

 

“Account Debtor” means any “account debtor” as defined in the Code with such
additions to such term as may hereafter be made.

 

“Acquisition” means (a) any Stock Acquisition, or (b) any Asset Acquisition.

 

“Acquisition Agreement” means, collectively, (a) the Asset Purchase Agreement
between Borrower and Assertio Therapeutics, Inc., a Delaware corporation,
executed and delivered by all parties thereto on or before the Closing Date,
including, for the avoidance of doubt, the disclosure schedules prepared and
delivered by the parties thereto in accordance therewith (the “Purchase
Agreement”), (b) the Services Agreement (as defined in the Purchase Agreement)
executed and delivered by all parties thereto in accordance with the Purchase
Agreement, (c) the Escrow Agreement (as defined in the Purchase Agreement)
executed and delivered by all parties thereto in accordance with the Purchase
Agreement, and (d) any other material contract or agreement delivered in
accordance with the Purchase Agreement or in furtherance of the transactions
contemplated by the Purchase Agreement (including the Bill of Sale, Assignment
and Assumption Agreement, IP Assignments and Purchaser FDA Transfer Letters (as
each such term is defined in the Purchase Agreement)).

 

“Acquisition IP” means any and all of the following, as they exist throughout
the world: (a) Current Acquisition IP; (b) improvements, continuations,
continuations-in-part, divisions, provisionals or any substitute applications,
any patent issued with respect to any of the Current Acquisition IP, any
reissue, reexamination, renewal or patent term extension or adjustment
(including any supplementary protection certificate) of any such patent, and any
confirmation patent or registration patent or patent of addition based on any
such patent, and all foreign counterparts of any of the foregoing; (c) trade
secrets or trade secret rights, including any rights to unpatented inventions,
know-how, show-how and operating manuals, in each case, specifically relating to
any Acquisition Product in the Territory; (d) any and all IP Ancillary Rights
specifically relating to any of the foregoing; and (e) regulatory filings,
submissions and approvals related to any Acquisition Product.

 

“Acquisition Products” means, collectively, Nucynta® ER, Nucynta® Oral Solution
and Nucynta® Tablets.

 

“Additional Consideration” is defined in Section 2.7(b).

 

“Adverse Proceeding” means any action, suit, proceeding, hearing (whether
administrative, judicial or otherwise), governmental investigation or
arbitration (whether or not purportedly on behalf of any Credit Party or any of
its Subsidiaries) at law or in equity, or before or by any Governmental
Authority, domestic or foreign (including any Environmental Claims), whether
pending or, to the Knowledge of Borrower, threatened against or adversely
affecting any Credit Party or any of its Subsidiaries or any property of any
Credit Party or any of its Subsidiaries.

 

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“Affiliate” means, with respect to any Person, each other Person that owns or
controls directly or indirectly the Person, any Person that controls or is
controlled by or is under common control with the Person, and each of that
Person’s senior executive officers, directors, partners and, for any Person that
is a limited liability company or limited liability partnership, that Person’s
managers and members. As used in this definition, “control” means (a) direct or
indirect beneficial ownership of at least fifty percent (50%) (or such lesser
percentage which is the maximum allowed to be owned by a foreign corporation in
a particular jurisdiction) of the voting share capital or other equity interest
in a Person or (b) the power to direct or cause the direction of the management
of such Person by contract or otherwise. In no event shall the Collateral Agent
or any Lender be deemed to be an Affiliate of Borrower or any of its
Subsidiaries.

 

“Agreement” is defined in the preamble hereof.

 

“Alternate Benchmark Rate” means: (a) in the case of a LIBOR Rate Transition
Event, the alternate rate of interest to the three-month LIBOR Rate established
by the Required Lenders and Borrower that gives due consideration to (i) any
selection or recommendation of a replacement rate or the mechanism for
determining such a rate by the relevant Governmental Authority or (ii) any
evolving or then-prevailing market convention for determining a rate of interest
for Dollar-denominated credit facilities in the United States at such time; or
(b) in the case of an Early Opt-In Determination, the alternate rate of interest
to the three-month LIBOR Rate that has been determined by the Collateral Agent
or the Required Lenders, as applicable.

 

“Alternate Benchmark Rate Start Date” means (a) in the case of a LIBOR Rate
Transition Event, the earlier of (i) the applicable LIBOR Rate Replacement Date
and (ii) if such LIBOR Rate Transition Event is a public statement or
publication of information of a prospective event, the 90th day prior to the
expected date of such event as of such public statement or publication of
information (or if the expected date of such prospective event is fewer than
ninety (90) days after such statement or publication, the date of such statement
or publication) and (b) in the case of an Early Opt-in Determination, the date
specified by the Collateral Agent by notice to Borrower and Lenders.

 

“Anti-Money Laundering Laws” is defined in Section 4.18(b).

 

“Applicable Accounting Standards” means with respect to Borrower and its
Subsidiaries, generally accepted accounting principles in the United States as
set forth in the opinions and pronouncements of the Accounting Principles Board
of the American Institute of Certified Public Accountants and statements and
pronouncements of the Financial Accounting Standards Board or in such other
statements by such other Person as may be approved by a significant segment of
the accounting profession, which are applicable to the circumstances as of the
date of determination, consistently applied.

 

“Applicable Percentage” means, with respect to each Lender at any time of
determination, the percentage equal to a fraction, the numerator of which is:
(a) on or prior to the Closing Date, the amount of such Lender’s Term Loan
Commitment at such time and the denominator of which is the Term Loan Amount at
such time; and (b) after the Closing Date, the outstanding principal amount of
such Lender’s portion of the Term Loans at such time, and the denominator of
which is the aggregate outstanding principal amount of the Term Loans at such
time.

 

“ASC” is defined in Section 1.

 

“Asset Acquisition” means, with respect to Borrower or any of its Subsidiaries,
any purchase, inbound license or other acquisition of any properties or assets
(other than assets used in the ordinary course of business consistent with past
practice) of any other Person (including any purchase or other acquisition of
any business unit, line of business or division of such Person or all or
substantially all of the assets of such Person). For the avoidance of doubt,
“Asset Acquisition” includes any co-promotion or co-marketing arrangement
pursuant to which Borrower or any Subsidiary acquires rights to promote or
market the products of another Person.

 

“Assumed Liabilities” has the meaning assigned to such term in the Purchase
Agreement.

 

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“Bankruptcy Code” means Title 11 of the United States Code entitled
“Bankruptcy,” as now and hereafter in effect, or any successor statute.

 

“Blocked Person” means an individual or entity that is, or is owned or
controlled by individuals or entities that are: (i) the subject or target of any
sanctions administered or enforced by OFAC, the U.S. Department of State, the
United Nations Security Council, the European Union, Her Majesty’s Treasury or
other relevant sanctions authority, or (ii) located, organized or resident in a
country or territory that is the subject of Sanctions, including currently,
Crimea, Cuba, Iran, North Korea, and Syria.

 

“Board of Directors” means, 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, or if there is
none, the Board of Directors of the managing member 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.

 

“Board of Governors” means the Board of Governors of the United States Federal
Reserve System, or any successor thereto.

 

“Books” means all books and records including ledgers, records regarding a
Credit Party’s assets or liabilities, the Collateral, business operations or
financial condition, and all computer programs or storage or any equipment
containing such information.

 

“Borrower” is defined in the preamble hereof.

 

“Borrowing Resolutions” means, with respect to any Person, those resolutions
adopted by such Person’s Board of Directors and delivered by such Person to the
Collateral Agent pursuant to Section 3.1 approving the Loan Documents to which
such Person is a party and the transactions contemplated thereby (including the
Term Loans), together with a certificate executed by its Secretary (or similar
officer) on behalf of such Person certifying that (a) such Person has the
authority to execute, deliver, and perform its obligations under each of the
Loan Documents to which it is a party, (b) attaches as an exhibit to such
certificate a true, correct, and complete copy of the resolutions then in full
force and effect authorizing and ratifying the execution, delivery, and
performance by such Person of the Loan Documents to which it is a party, (c)
includes the name(s) and title(s) of the officers of such Person authorized to
execute the Loan Documents to which such Person is a party on behalf of such
Person, together with a sample of the true signature(s) of such Person(s), and
(d) the Collateral Agent and each Lender may conclusively rely on such
certificate with respect to the authority of such officers unless and until such
Person shall have delivered to the Collateral Agent a further certificate
canceling or amending such prior certificate.

 

“Business Day” means any day that is not a Saturday or a Sunday or a day on
which banks are authorized or required to be closed in New York, New York,
London or the Cayman Islands.

 

“Capital Lease” means, as applied to any Person, any lease of, or other
arrangement conveying the right to use, any property by that Person as lessee
that has been or should be accounted for as a capital lease on a balance sheet
of such Person prepared in accordance with Applicable Accounting Standards
(subject to Section 1 hereof).

 

“Capital Lease Obligations” means, at any time, with respect to any Capital
Lease, any lease entered into as part of any sale leaseback transaction of any
Person or any synthetic lease, the amount of all obligations of such Person that
is (or that would be, if such synthetic lease or other lease were accounted for
as a Capital Lease) capitalized on a balance sheet of such Person prepared in
accordance with Applicable Accounting Standards.

 

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“Cash Equivalents” means

 

(a)       securities issued or directly and fully guaranteed or insured by the
United States government or any agency or instrumentality of the United States
government or by the government of any other member country of O.E.C.D.
(provided that the full faith and credit of the United States or such other
member country of O.E.C.D., as applicable, is pledged in support of those
securities), in each case, having maturities of not more than two (2) years from
the date of acquisition;

 

(b)       certificates of deposit, time deposits with maturities of one year or
less from the date of acquisition, bankers’ acceptances with maturities not
exceeding one year and overnight bank deposits and demand deposits, in each
case, with any commercial bank having (i) capital and surplus in excess of
$500,000,000 in the case of U.S. banks or (ii) capital and surplus in excess of
$100,000,000 (or the U.S. dollar equivalent as of the date of determination) in
the case of non-U.S. banks;

 

(c)       commercial paper or marketable short-term money market or readily
marketable direct obligations and similar securities having one of the two
highest ratings obtainable from Moody’s Investors Services, Inc. or S&P Global
Ratings and, in each case, maturing within two (2) years after the date of
acquisition;

 

(d)       repurchase obligations with a term of not more than seven (7) days for
underlying securities of the types described in clauses (a) and (c) above
entered into with any financial institution meeting the qualifications specified
in clause (b) above;

 

(e)       investment funds investing ninety-five percent (95.0%) of their assets
in securities of the types described in clauses (a) through (d) above and clause
(f) below;

 

(f)       investments in money market funds rated “AAA” (or the equivalent
thereof) or better by S&P Global Ratings or “Aaa” (or the equivalent thereof) or
better by Moody’s Investors Services, Inc. (or, if at any time neither Moody’s
Investors Services, Inc. nor S&P Global Ratings shall be rating such
obligations, an equivalent rating from another rating agency) and that have
portfolio assets of at least $1,000,000,000; and

 

(g)       other investments in accordance with the Borrower’s investment policy
as of the Effective Date or otherwise approved in writing by Collateral Agent.

 

“CFC” means a “controlled foreign corporation” within the meaning of Section 957
of the Code or any successor provision thereto; provided, that a “controlled
foreign corporation” shall not constitute a CFC hereunder unless, at the
relevant date of determination, there is (a) a reasonable expectation of
substantial earnings and profits not subject to current inclusion in U.S.
taxable income and (b) such earning and profits would not (i) be excluded, upon
a “hypothetical distribution”, from the “tentative section 956 amount” (in each
case, within the within the meaning of Treasury Regulations Section
1.956-1(a)(2)) by reason of the dividends received deduction under Section 245A
of the Code, (ii) be excluded from gross income under Section 959(a) of the Code
upon an actual distribution, or (iii) otherwise, if distributed, be treated as a
return of basis under Section 301(c)(2) of the Code.

 

“CFC Domestic Subsidiary” means any Subsidiary that is organized under the laws
of the United States, any state thereof or the District of Columbia that has no
material assets other than the equity or debt of one or more CFCs or Disregarded
Domestic Subsidiary.

 

“Change in Control” means: (a) a transaction or series of transactions
(including any merger or consolidation with Borrower) in which any “person” or
“group” (within the meaning of Section 13(d) and 14(d)(2) of the Exchange Act,
but excluding any employee benefit plan of such Person or its Subsidiaries, and
any Person acting in its capacity as trustee, agent or other fiduciary or
administrator of any such plan) is or becomes the “beneficial owner” (as defined
in Rule 13d-3 under the Exchange Act), directly or indirectly, of a majority of
shares of the then outstanding capital stock of Borrower ordinarily entitled to
vote in the election of directors; (b) a sale of all or substantially all of the
consolidated assets of Borrower and its Subsidiaries in one transaction or a
series of transactions (whether by way of merger, stock purchase, asset purchase
or otherwise); or (c) a merger or consolidation involving Borrower in which
Borrower is not the surviving Person.

 

53 

 

 

“Change in Law” means the occurrence, after the date of this Agreement, of any
of the following: (a) the adoption or taking into effect of any law, treaty,
order, policy, rule or regulation, (b) any change in any law, treaty, order,
policy, rule or regulation or in the administration, interpretation or
application thereof by any Governmental Authority or (c) the making or issuance
of any request, guideline or directive (whether or not having the force of law)
by any Governmental Authority; provided that notwithstanding anything herein to
the contrary, (x) the Dodd-Frank Wall Street Reform and Consumer Protection Act
and all requests, rules, guidelines or directives thereunder or issued in
connection therewith and (y) all requests, rules, guidelines or directives
promulgated by the Bank for International Settlements, the Basel Committee on
Banking Supervision (or any successor or similar authority) or the United States
or foreign regulatory authorities, in each case, pursuant to Basel III, shall be
deemed to be a “Change in Law”, regardless of the date enacted, adopted or
issued.

 

“Closing Date” means the date on which the Term Loans are advanced by Lenders,
which, subject to the satisfaction of the conditions precedent to the Term Loans
set forth in Sections 3.1 and 3.2, shall be not less than four (4) and not more
than six (6) Business Days following the Effective Date; provided, however, that
the Closing Date shall not occur less than two (2) Business Days after Borrower
notifies the Collateral Agent and Lenders in writing regarding the date on which
the Closing Date shall occur.

 

“Code” means the Uniform Commercial Code, as the same may, from time to time, be
enacted and in effect in the State of New York; provided, that, to the extent
that the Code is used to define any term herein or in any Loan Document and such
term is defined differently in different Articles of the Code, the definition of
such term contained in Article 9 of the Code shall govern; provided, further,
that in the event that, by reason of mandatory provisions of law, any or all of
the attachment, perfection, or priority of, or remedies with respect to, the
Collateral Agent’s Lien, for the benefit of Lenders and the other Secured
Parties, on any Collateral is governed by the Uniform Commercial Code in effect
in a jurisdiction other than the State of New York, the term “Code” shall mean
the Uniform Commercial Code as enacted and in effect in such other jurisdiction
solely for purposes of the provisions thereof relating to such attachment,
perfection, priority, or remedies and for purposes of definitions relating to
such provisions.

 

“Collateral” means, collectively, “Collateral” (as such term is defined in the
Security Agreement) and all other property of whatever kind and nature subject
or purported to be subject from time to time to a Lien under any Collateral
Document, but in any event excluding all Excluded Property.

 

“Collateral Account” means any Deposit Account of a Credit Party maintained with
a bank or other depository or financial institution located in the United
States, any Securities Account of a Credit Party maintained with a securities
intermediary located in the United States, or any Commodity Account of a Credit
Party maintained with a commodity intermediary located in the United States,
other than an Excluded Account.

 

“Collateral Access Agreement” means an agreement, in form and substance
reasonably satisfactory to the Collateral Agent and to which the Collateral
Agent is a party, pursuant to which a mortgagee or lessor of real property on
which Collateral is stored or otherwise located, or a warehouseman, processor or
other bailee of Inventory or other property owned by any Credit Party,
acknowledges the Liens and security interests of the Collateral Agent, for the
benefit of Lenders and the other Secured Parties, and waives (or, if approved by
the Collateral Agent in its sole discretion, subordinates) any Liens or security
interests held by such Person on any such Collateral, and, in the case of any
such agreement with a mortgagee or lessor, permits the Collateral Agent and any
Lender (and its representatives and designees) reasonable access to any
Collateral stored or otherwise located thereon.

 

“Collateral Agent” means BioPharma Credit PLC, in its capacity as Collateral
Agent appointed under Section 12.1, and its successors in such capacity.

 

“Collateral Documents” means, collectively, the Security Agreement, the Control
Agreements, the IP Agreements, any Mortgages and any and all other instruments,
documents and agreements delivered by any Credit Party pursuant to this
Agreement or any of the other Loan Documents in order to grant to the Collateral
Agent, for the benefit of Lenders and the other Secured Parties, or perfect, a
Lien on any Collateral as security for the Obligations, and all amendments,
restatements, modifications or supplements thereof or thereto.

 

“Commodity Account” means any “commodity account” as defined in the Code with
such additions to such term as may hereafter be made.

 

54 

 

 

“Company IP” means any and all of the following, as they exist in and throughout
the Territory: (a) Current Company IP; (b) improvements, continuations,
continuations-in-part, divisions, provisionals or any substitute applications,
any patent issued with respect to any of the Current Company IP, any patent
right claiming the composition of matter of, or the method of making or using,
any Product in the Territory, any reissue, reexamination, renewal or patent term
extension or adjustment (including any supplementary protection certificate) of
any such patent, and any confirmation patent or registration patent or patent of
addition based on any such patent; (c) trade secrets or trade secret rights,
including any rights to unpatented inventions, know-how, show-how and operating
manuals, in each case, specifically relating to any Product in the Territory;
(d) any and all IP Ancillary Rights specifically relating to any of the
foregoing; and (e) regulatory filings, submissions and approvals related to any
research, development, manufacture, production, use, commercialization,
marketing, importing, storage, transport, offer for sale, distribution or sale
of any Product in the Territory and all data provided in any of the foregoing.

 

“Compliance Certificate” means that certain certificate in the form attached
hereto as Exhibit D.

 

“Competitor” means, at any time of determination, any Person that is an
operating company directly and primarily engaged in the same or substantially
the same line of business as the Borrower and its Subsidiaries, including those
Persons identified on Schedule 12.1 of the Disclosure Letter, which Borrower may
update from time to time.

 

“Connection Income Taxes” means Other Connection Taxes that are imposed on or
measured by net income (however denominated) or that are franchise Taxes or
branch profits Taxes.

 

“Contingent Obligation” means, for any Person, (a) any direct or indirect
liability, contingent or not, of that Person for any indebtedness, lease,
dividend, letter of credit or other obligation of another Person directly or
indirectly guaranteed, endorsed, co-made, discounted or sold with recourse by
that Person, or for which that Person is directly or indirectly liable (other
than by endorsements of instruments in the course of collection) and (b) any
obligation of that Person to pay an earn-out payment, milestone payment or
similar contingent payment or contingent compensation (including purchase price
adjustments) to a counterparty incurred or created in connection with an
Acquisition, Transfer or Investment or otherwise in connection with any
collaboration, development or similar agreement, in each instance where such
contingent payment or compensation becomes due and payable upon the occurrence
of an event or the performance of an act (and not solely with the passage of
time). The amount of a Contingent Obligation is the stated or determined amount
of the primary obligation for which the Contingent Obligation is made or, if not
determinable, the maximum reasonably anticipated liability for it reasonably
determined by such Person in good faith; but the amount may not exceed the
maximum of the obligations under any guarantee or other support arrangement.

 

“Control Agreement” means, with respect to any Credit Party, any control
agreement entered into among such Credit Party, the Collateral Agent and, in the
case of a Deposit Account, the bank or other depository or financial institution
located in the United States at which such Credit Party maintains such Deposit
Account, or, in the case of a Securities Account or a Commodity Account, the
securities intermediary or commodity intermediary located in the United States
at which such Credit Party maintains such Securities Account or Commodities
Account, in either case, pursuant to which the Collateral Agent obtains control
(within the meaning of the Code) over such Collateral Account.

 

“Copyrights” means any and all copyright rights, copyright applications,
copyright registrations and like protections in each work of authorship and
derivative work thereof, whether published or unpublished and whether or not the
same also constitutes a trade secret.

 

“Credit Extension” means any Term Loan or any other extension of credit by any
Lender for Borrower’s benefit pursuant to this Agreement.

 

“Credit Party” means Borrower and each Guarantor.

 

“CSA” is defined in Section 4.19(c).

 

“Current Acquisition IP” is defined in Section 4.6(c)(ii).

 

55 

 

 

“Current Acquisition IP Agreement” means any Transferred Contract (as defined in
the Acquisition Agreement) that will be acquired or assumed by Borrower (or any
of its Affiliates) pursuant to the Acquisition Agreement, pursuant to which
Borrower (or any such Affiliate) has the legal right to exploit Current
Acquisition IP that is owned by another Person to research, develop,
manufacture, produce, use, supply, commercialize, market, import, store,
transport, offer for sale, distribute or sell any Acquisition Product.

 

“Current Company IP” is defined in Section 4.6(c)(i).

 

“Current Company IP Agreement” means any contract or agreement, pursuant to
which Borrower or any of its Subsidiaries has the legal right to exploit Current
Company IP that is owned by another Person, to research, develop, manufacture,
produce, use, supply, commercialize, market, import, store, transport, offer for
sale, distribute or sell any Product that is not an Acquisition Product.

 

“Data Protection Laws” means, collectively, any and all foreign or domestic,
statutes, ordinances, orders, rules, regulations, judgments, Governmental
Approvals, or any other requirements of Governmental Authorities relating to the
privacy, security, or confidentiality of personal data (including individually
identifiable information) and other sensitive information, including HIPAA,
Section 5 of the Federal Trade Commission Act (15 U.S.C. § 45), and GDPR.

 

“DEA” means the United States Drug Enforcement Administration.

 

“DEA Laws” means all applicable statutes (including the CSA), rules, regulations
and orders implemented, administered, enforced or issued by DEA (and any foreign
or U.S. state equivalent).

 

“Default” means any breach of or default under any term, provision, condition,
covenant or agreement contained in this Agreement or any other Loan Document or
any other event, that, in each case, with the giving of notice or the lapse of
time or both, would constitute an Event of Default.

 

“Disregarded Domestic Subsidiary” means any direct or indirect Subsidiary that
is organized under the laws of the United States, any state thereof or the
District of Columbia that is treated as disregarded for U.S. tax purposes and
substantially all the assets of which consist of equity of one or more CFCs.

 

“Deposit Account” means any “deposit account” as defined in the Code with such
additions to such term as may hereafter be made.

 

“Disclosure Letter” means the disclosure letter to this Agreement, dated the
Effective Date, delivered by the Credit Parties to the Collateral Agent
(including all schedules attached thereto).

 

“Disqualified Equity Interest(s)” means any Equity Interest that, by its terms
(or by the terms of any security or other Equity Interests into which it is
convertible or for which it is exchangeable) or upon the happening of any event
or condition, (a) matures or is mandatorily redeemable, pursuant to a sinking
fund obligation or otherwise (except as a result of a change of control, asset
sale or similar event so long as any rights of the holders thereof upon the
occurrence of a change of control, asset sale or similar event shall be subject
to the prior repayment in full in cash of the Term Loans and all other
Obligations (other than inchoate indemnity obligations)), (b) is redeemable at
the option of the holder thereof, in whole or in part (except as a result of a
change of control, asset sale or similar event so long as any rights of the
holders thereof upon the occurrence of a change of control, asset sale or
similar event shall be subject to the prior repayment in full in cash of the
Term Loans and all other Obligations (other than inchoate indemnity
obligations)), (c) provides for the scheduled payments of dividends or
distributions in cash, or (d) is convertible into or exchangeable for (i)
Indebtedness or (ii) any other Equity Interest that would constitute a
Disqualified Equity Interest, in each case described in clauses (a) through (d)
above, prior to the date that is 180 days after the Term Loan Maturity Date;
provided that, if such Equity Interest is issued pursuant to any plan for the
benefit of any employee, director, manager or consultant of the Borrower or its
Subsidiaries or by any such plan to such employee, director, manager or
consultant, such Equity Interest shall not constitute a Disqualified Equity
Interest solely because it may be required to be repurchased by the Borrower or
its Subsidiaries in order to satisfy applicable statutory or regulatory
obligations or as a result of the termination, death or disability of such
employee, director, manager or consultant.

 

56 

 

 

“Dollars,” “dollars” or use of the sign “$” means only lawful money of the
United States and not any other currency, regardless of whether that currency
uses the “$” sign to denote its currency or may be readily converted into lawful
money of the United States.

 

“Early Opt-In Determination” means the occurrence of: (a) the determination by
the Collateral Agent (which determination shall be conclusive absent manifest
error) that adequate and reasonable means do not exist for determining the rate
described in clause (a) or clause (b) of the definition of “LIBOR Rate” and such
circumstances are reasonably likely to be permanent or indefinite; or (b) the
determination by the Collateral Agent, or a notification by the Required Lenders
to the Collateral Agent (with a copy to Borrower) that the Required Lenders have
determined, that the three-month Dollar-denominated credit facilities being
executed at such time are being executed or amended to incorporate or adopt a
new benchmark interest rate to replace the three-month LIBOR Rate for
Dollar-denominated credit facilities.

 

“Effective Date” is defined in the preamble hereof.

 

“Environmental Claim” means any investigation, notice, notice of violation,
claim, action, suit, proceeding, demand, abatement order or other order or
directive (conditional or otherwise), by any Governmental Authority or any other
Person, arising (i) pursuant to or in connection with any actual or alleged
violation of any Environmental Law; (ii) in connection with any Hazardous
Material or any actual or alleged Hazardous Materials Activity; or (iii) in
connection with any actual or alleged damage, injury, threat or harm to health,
safety, natural resources or the environment.

 

“Environmental Laws” means, with respect to any Credit Party, Subsidiary or any
Facility, collectively, any and all applicable current or future, foreign or
domestic, statutes, ordinances, orders, rules, regulations, judgments and
Governmental Approvals, and any other requirements of Governmental Authorities,
relating to (i) environmental matters, including those relating to any Hazardous
Materials Activity, (ii) the generation, use, storage, transportation or
disposal of Hazardous Materials or (iii) occupational safety and health,
industrial hygiene, land use or the protection of human, plant or animal health
or welfare.

 

“Equity Interests” means, with respect to any Person, collectively, any and all
shares, interests, participations or other equivalents (however designated) of
capital stock of a corporation, any and all equivalent ownership interests in
such Person (other than a corporation), including partnership interests and
membership interests, and any and all warrants, rights or options to purchase or
other arrangements or rights to acquire (by purchase, conversion, dividend,
distribution or otherwise) any of the foregoing (and all other rights, powers,
privileges, interests, claims and other property in any manner arising therefrom
or relating thereto); provided, however, that Indebtedness convertible into
Equity Interests (or into any combination of cash and Equity Interests based on
the value of such Equity Interests) shall not constitute Equity Interests unless
and until (and solely to the extent) so converted into Equity Interests.

 

“Equity Proceeds Prepayment” means any single prepayment of Term Loans by
Borrower of no more than $50,000,000 pursuant to Section 2.2(c)(i) made (ii)
solely with the proceeds from an issuance of Equity Interests in Borrower and
(ii) within sixty (60) days of the issuance of such Equity Interests.

 

“Equity Proceeds Prepayment Premium” means, with respect to the Equity Proceeds
Prepayment, if Borrower makes such prepayment on or prior to the 2nd-year
anniversary of the Closing Date, an amount equal to the product of the aggregate
principal amount of the Term Loans prepaid multiplied by 0.05. For the avoidance
of doubt, no Equity Prepayment Premium shall be due and owing with respect to
the Equity Proceeds Prepayment if Borrower makes such prepayment after the
2nd-year anniversary of the Closing Date.

 

“ERISA” means the Employee Retirement Income Security Act of 1974, and its
regulations.

 

57 

 

 

“ERISA Affiliate” means, with respect to any Person, any trade or business
(whether or not incorporated) that, together with such Person, is treated as a
single employer under Section 414(b) or (c) of the IRC or, solely for purposes
of Section 302 of ERISA or Section 412 of the IRC, Section 412(m) or (o) of the
IRC.

 

“ERISA Event” means (a) any “reportable event,” as defined in Section 4043 of
ERISA or the regulations issued thereunder, with respect to a Plan (other than
an event for which the 30-day notice period is waived by regulation); (b) with
respect to a Plan, the failure by Borrower or its Subsidiaries or their ERISA
Affiliates to satisfy the minimum funding standard of Section 412 of the IRC and
Section 302 of ERISA, whether or not waived; (c) the failure by Borrower or its
Subsidiaries or their ERISA Affiliates to make by its due date a required
installment under Section 430(j) of the IRC with respect to any Plan or to make
any required contribution to a Multiemployer Plan; (d) the filing pursuant to
Section 412(c) of the IRC or Section 302(c) of ERISA of an application for a
waiver of the minimum funding standard with respect to any Plan; (e) the
incurrence by Borrower or any of its ERISA Affiliates of any liability under
Title IV of ERISA with respect to the termination of any Plan; (f) the receipt
by Borrower or its Subsidiaries or any of their respective ERISA Affiliates from
the Pension Benefit Guaranty Corporation (referred to and defined in ERISA) or a
plan administrator of any notice relating to the intention to terminate any Plan
or Plans under Section 4041 or 4041A of ERISA or to appoint a trustee to
administer any Plan under Section 4042 of ERISA, or the occurrence of any event
or condition which would reasonably be expected to constitute grounds under
ERISA for the termination of, or the appointment of a trustee to administer, any
Plan under Section 4041 Section 4042 of ERISA; (g) the incurrence by Borrower or
its Subsidiaries or any of their respective ERISA Affiliates of any liability
with respect to the withdrawal from any Plan or Multiemployer Plan; (h) the
receipt by Borrower or its Subsidiaries or any of their respective ERISA
Affiliates of any notice, concerning the imposition of Withdrawal Liability or a
determination that a Multiemployer Plan is, or is expected to be, insolvent or
in reorganization, within the meaning of Section 4245 or Section 4241,
respectively, of ERISA; (i) the “substantial cessation of operations” by
Borrower or its Subsidiaries or their ERISA Affiliates within the meaning of
Section 4062(e) of ERISA with respect to a Plan; or (j) the occurrence of a
nonexempt prohibited transaction (within the meaning of Section 4975 of the IRC
or Section 406 of ERISA) which would reasonably be expected to result in
material liability to Borrower or its Subsidiaries.

 

“Estimated Purchase Price” has the meaning assigned to such term in the Purchase
Agreement.

 

“Event of Default” is defined in Section 7.

 

“Exchange Act” means the Securities Exchange Act of 1934.

 

“Exchange Act Documents” is defined in Section 4.8(a).

 

“Excluded Accounts” is defined in Section 5.5.

 

“Excluded Equity Interests” means, collectively: (i) any Equity Interests in any
Subsidiary with respect to which the grant to the Collateral Agent, for the
benefit of Lenders and the other Secured Parties, of a security interest therein
and Lien thereon, and the pledge to the Collateral Agent, for the benefit of
Lenders and the other Secured Parties, thereof, to secure the Obligations (and
any guaranty thereof) are validly prohibited by Requirements of Law; (ii) any
Equity Interests in any Subsidiary with respect to which the grant to the
Collateral Agent, for the benefit of Lenders and the other Secured Parties, of a
security interest therein and Lien thereon, and the pledge to the Collateral
Agent, for the benefit of Lenders and the other Secured Parties, thereof, to
secure the Obligations (and any guaranty thereof) require the consent, approval
or waiver of any Governmental Authority or other third party and such consent,
approval or waiver has not been obtained by Borrower following Borrower’s
commercially reasonable efforts to obtain the same; (iii) any Equity Interests
in any Subsidiary that is a non-Wholly-Owned Subsidiary that the grant to the
Collateral Agent, for the benefit of Lenders and the other Secured Parties, of a
security interest therein and Lien thereon, and the pledge to the Collateral
Agent, for the benefit of Lenders and the other Secured Parties, thereof, to
secure the Obligations (and any guaranty thereof) are validly prohibited by, or
would give any third party (other than Borrower or an Affiliate of Borrower) the
right to terminate its obligations under, the Operating Documents or the joint
venture agreement or shareholder agreement with respect to, or any other
contract or agreement with such third party relating to, such non-Wholly-Owned
Subsidiary, including any contract or agreement evidencing any Indebtedness of
such non-Wholly-Owned Subsidiary (other than customary non-assignment provisions
which are ineffective under Article 9 of the Code or other Requirements of Law),
but, in the case of any such Equity Interests, only to the extent and for so
long as such Operating Document, joint venture agreement, shareholder agreement
or other contract or agreement is in effect; (iv) any voting Equity Interests in
excess of 65% of the issued and outstanding Equity Interests of each Subsidiary
that is (A) a CFC, (B) a CFC Domestic Subsidiary or (C) a Disregarded Domestic
Subsidiary; (v) so long as it shall be in compliance with the covenant set forth
in Section 6.2(c), Collegium NF, LLC, and (vi) any Equity Interests in any other
Subsidiary, with respect to which Borrower and the Collateral Agent reasonably
determine by mutual agreement that the cost of granting the Collateral Agent,
for the benefit of Lenders and the other Secured Parties, a security interest
therein and Lien thereon, and pledging to the Collateral Agent, for the benefit
of Lenders and the other Secured Parties, thereof, to secure the Obligations
(and any guaranty thereof) are excessive, relative to the value to be afforded
to the Secured Parties thereby.

 

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“Excluded License” means an exclusive license or sublicense, to a Person other
than a Subsidiary of Borrower, of any Intellectual Property within the Territory
covering any Product that is tantamount to a sale of substantially all rights to
the Intellectual Property covering such Product because it conveys to the
licensee or sublicensee exclusive rights to practice such Intellectual Property
in the Territory for consideration that is not based upon future development or
commercialization of any Products in the Territory (other than pursuant to
so-called earn-out payments) or services by the licensee or sublicensee (other
than transition services), such as, for example, consideration of only upfront
advances or initial license fees or similar payments in consideration of such
rights, with no anticipated subsequent payments or only de minimis payments to
Borrower or any of its Subsidiaries (other than pursuant to so-called earn-out
payments or transition services).

 

“Excluded Property” has the meaning set forth in the Security Agreement.

 

“Excluded Subsidiaries” means, collectively: (i) any Subsidiary, with respect to
which the grant to the Collateral Agent, for the benefit of Lenders and the
other Secured Parties, of a security interest in and Lien upon, and the pledge
to the Collateral Agent, for the benefit of Lenders and the other Secured
Parties, of, the properties and assets thereof subject or purported to be
subject from time to time to a Lien under any Collateral Document and the Equity
Interests therein to secure the Obligations (and any guaranty thereof) are
validly prohibited by Requirements of Law; (ii) any Subsidiary, with respect to
which the grant to the Collateral Agent, for the benefit of Lenders and the
other Secured Parties, of a security interest in and Lien upon, and the pledge
to the Collateral Agent, for the benefit of Lenders and the other Secured
Parties, of, the properties and assets thereof subject or purported to be
subject from time to time to a Lien under any Collateral Document and the Equity
Interests therein to secure the Obligations (and any guaranty thereof) require
the consent, approval or waiver of any Governmental Authority or other third
party (other than Borrower or an Affiliate of Borrower) and such consent,
approval or waiver has not been obtained by Borrower or such Subsidiary
following Borrower’s and such Subsidiary’s commercially reasonable efforts to
obtain the same; (iii) any Subsidiary that is a non-Wholly Owned Subsidiary with
respect to which the grant to the Collateral Agent, for the benefit of Lenders
and the other Secured Parties, of a security interest in and Lien upon, and the
pledge to the Collateral Agent, for the benefit of Lenders and the other Secured
Parties, of, the properties and assets thereof to secure the Obligations (and
any guaranty thereof) are validly prohibited by, or would give any third party
(other than Borrower or an Affiliate of Borrower) the right to terminate its
obligations under, such non-Wholly Owned Subsidiary’s Operating Documents or the
joint venture agreement or shareholder agreement with respect thereto or any
other contract or agreement with such third party relating thereto, including
any contract or agreement evidencing any Indebtedness of such non-Wholly Owned
Subsidiary (other than customary non-assignment provisions which are ineffective
under Article 9 of the Code or other Requirements of Law), but, in each case,
only to the extent and for so long as such Operating Document, joint venture
agreement, shareholder agreement or other contract or agreement is in effect;
(iv) any Subsidiary that owns properties and assets with an aggregate fair
market value (reasonably determined in good faith by a Responsible Officer of
Borrower) of less than $5,000,000; (v) any (A) CFC, (B) Subsidiary of a CFC, (C)
CFC Domestic Subsidiary or (D) Disregarded Domestic Subsidiary; (vi) any
not-for-profit Subsidiaries, captive insurance Subsidiaries and special purpose
entities used for permitted financings; (viii) so long as it shall be in
compliance with Section 6.2(c), Collegium NF, LLC, and (ix) any other
Subsidiary, with respect to which Borrower and the Collateral Agent reasonably
determined by mutual agreement that the cost of granting the Collateral Agent,
for the benefit of Lenders and the other Secured Parties, a security interest in
and Lien upon, and pledging to the Collateral Agent, for the benefit of Lenders
and the other Secured Parties, the properties and assets thereof subject or
purported to be subject from time to time to a Lien under any Collateral
Document and the Equity Interests therein to secure the Obligations (and any
guaranty thereof) or are excessive relative to the value to be afforded to the
Secured Parties thereby.

 

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“Excluded Taxes” means any of the following Taxes imposed on or with respect to
Lender or required to be withheld or deducted from a payment to Lender, (a)
Taxes imposed on or measured by net income (however denominated), franchise
Taxes, and branch profits Taxes, in each instance, (i) imposed by the United
States or as a result of Lender being organized under the laws of, or having its
principal office or its applicable lending office located in, the jurisdiction
imposing such Tax (or any political subdivision thereof) or (ii) that are Other
Connection Taxes, (b) U.S. federal withholding Taxes imposed on amounts payable
to or for the account of Lender with respect to any Obligation pursuant to a law
in effect on the date on which (i) Lender acquires such interest in any
Obligation or (ii) Lender changes its lending office, except to the extent that,
pursuant to Section 2.6, amounts with respect to such Taxes were payable either
to Lender’s assignor immediately before Lender became a party hereto or to
Lender immediately before it changed its lending office, (c) Taxes attributable
to Lender’s failure to comply with Section 2.6(d), and (d) any withholding Taxes
imposed under FATCA.

 

“Export and Import Laws” means, collectively, all applicable laws, regulations,
orders or directives that apply to the import, export, re-export, transfer,
disclosure or provision of goods, software, technology or technical assistance,
including any restrictions or controls administered pursuant to the U.S. Export
Administration Regulations, 15 C.F.R. Parts 730-774, administered by the U.S.
Department of Commerce, Bureau of Industry and Security, any U.S. Customs
regulations, and any other similar import and export laws, regulations, orders
and directives of other jurisdictions to the extent applicable.

 

“Facility” means any real property (including all buildings, fixtures or other
improvements located thereon) now, hereafter or heretofore owned, leased,
operated or used by any Credit Party or any of its Subsidiaries or any of their
respective predecessors or Affiliates, with respect to the manufacture,
production, storage or distribution any Product in the Territory.

 

“FATCA” means Sections 1471 through 1474 of the IRC, as of the date of this
Agreement (including, for the avoidance of doubt, any agreements between the
governments of the United States and the jurisdiction in which the applicable
Lender is resident implementing such provisions), or any amended or successor
version that is substantively comparable and not materially more onerous to
comply with, and any current or future regulations promulgated thereunder or
official interpretations thereof, any agreements entered into pursuant to
Section 1471(b)(1) of the IRC, any intergovernmental agreement entered into in
connection with the implementation of the foregoing sections of the IRC and any
fiscal or regulatory legislation, regulations, rules or practices adopted
pursuant to, or official interpretations implementing such Sections of the IRC
or intergovernmental agreements.

 

“FCPA” is defined in Section 4.18(a).

 

“FDA” means the United States Food and Drug Administration (and any foreign
equivalents, including the European Medicines Agency).

 

“FDA Good Clinical Practices” means the standards set forth in 21 C.F.R. Parts
50, 54, 56 and 312 and FDA’s implementing guidance documents.

 

“FDA Good Laboratory Practices” means the standards set forth in 21 C.F.R. Part
58 and FDA’s implementing guidance documents.

 

“FDA Good Manufacturing Practices” means the standards set forth in 21 C.F.R.
Parts 210, 211, 600 and 610 and FDA’s implementing guidance documents.

 

“FDA Laws” means all applicable statutes (including the FDCA), rules and
regulations implemented administered or enforced by the FDA (and any foreign
equivalent).

 

“FDCA” is defined in Section 4.19(b).

 

“Federal Reserve Board” means the Board of Governors of the Federal Reserve
System.

 

“Foreign Lender” means a Lender that is not a U.S. Person.

 

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“GDPR” means the General Data Protection Regulation (EU) 2016/679.

 

“General Prepayment Premium” means, with respect to any prepayment of the Term
Loans by Borrower pursuant to Section 2.2(c) that is not an Equity Proceeds
Prepayment or as a result of the acceleration of the maturity of the Term Loans
pursuant to Section 8.1(a), an amount equal to the product of the aggregate
principal amount of the Term Loans prepaid, multiplied by:

 

(a)       if such prepayment occurs on or prior to the 2nd-year anniversary of
the Closing Date, 0.03;

 

(b)       if such prepayment occurs after the 2nd-year anniversary of the
Closing Date but on or prior to the 3rd-year anniversary of the Closing Date,
0.02; and

 

(c)       if such prepayment occurs after the 3rd-year anniversary of the
Closing Date but prior to the 4th-year anniversary of the Closing Date, 0.01.

 

For the avoidance of doubt, no General Prepayment Premium shall be due and owing
for any payment of principal of the Term Loans made on the Term Loan Maturity
Date.

 

“Governmental Approval” means any consent, authorization, approval, order,
license, franchise, permit, certificate, accreditation, registration, filing or
notice, of, issued by, from or to, or other act by or in respect of, any
Governmental Authority.

 

“Governmental Authority” means any nation or government, any state or other
political subdivision thereof, any agency (including Regulatory Agencies),
government department, 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.

 

“Governmental Payor Programs” means all governmental third party payor programs
in which any Credit Party or its Subsidiaries participates, including Medicare,
Medicaid, TRICARE or any other federal or state health care programs.

 

“Guarantor” means any Subsidiary that is a present or future guarantor of the
Obligations.

 

“Hazardous Materials” means any chemical, material or substance, exposure to
which is prohibited, limited or regulated by any Governmental Authority or which
may or could pose a hazard to the health and safety of the owners, occupants or
any Persons in the vicinity of any Facility or to the indoor or outdoor
environment.

 

“Hazardous Materials Activity” means any past, current, proposed or threatened
activity, event or occurrence involving any Hazardous Materials, including the
use, manufacture, possession, storage, holding, presence, existence, location,
Release, threatened Release, discharge, placement, generation, transportation,
processing, construction, treatment, abatement, removal, remediation, disposal,
disposition or handling of any Hazardous Materials, and any corrective action or
response action with respect to any of the foregoing.

 

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“Health Care Laws” means, collectively: (a) all applicable federal, state or
local laws, rules, regulations, orders, ordinances, statutes and requirements
issued under or in connection with Medicare, Medicaid or any other Government
Payor Program; (b) all applicable federal and state laws and regulations
governing the confidentiality of health information, including HIPAA; (c) all
applicable federal, state and local fraud and abuse laws of any Governmental
Authority, including the federal Anti-Kickback Statute (42 U.S.C. § 1320a-7(b)),
the civil False Claims Act (31 U.S.C. § 3729 et seq.), Sections 1320a-7 and
1320a-7a of Title 42 of the United States Code and the regulations promulgated
pursuant to such statutes; (d) the Medicare Prescription Drug, Improvement, and
Modernization Act of 2003 (Pub. L. No. 108-173) and the regulations promulgated
thereunder; (e) the Physician Payment Sunshine Act (42 U.S.C. § 1320a-7h); (f)
all applicable reporting and disclosure requirements under the Medicaid Drug
Rebate Program (e.g., Monthly and Quarterly Average Manufacturer Price, Baseline
Average Manufacturer Price, and Rebate Per Unit, as applicable), Medicare Part B
(Quarterly Average Sales Price), Section 602 of the Veteran’s Health Care Act
(Public Health Service 340B Quarterly Ceiling Price), Section 603 of the
Veteran’s Health Care Act (Quarterly and Annual Non-Federal Average Manufacturer
Price and Federal Ceiling Price), Best Price, Federal Supply Schedule Contract
Prices and Tricare Retail Pharmacy Refunds, and Medicare Part D; (g) all
applicable health care laws, rules, codes, statutes, regulations, orders,
ordinances and requirements pertaining to Medicare or Medicaid; and (h) all
applicable federal, state or local laws, rules, regulations, ordinances,
statutes and requirements relating to (i) the regulation of managed care, third
party payors and Persons bearing the financial risk for the provision or
arrangement of health care services, (ii) billings to insurance companies,
health maintenance organizations and other Managed Care Plans or otherwise
relating to insurance fraud, or (iii) any insurance, health maintenance
organization or managed care Requirements of Law; and (i) any other applicable
health care laws, rules, codes, regulations, manuals, orders, ordinances, and
statutes relating to the manufacture, sale and distribution of pharmaceutical
products.

 

“Hedging Agreement” means any interest rate, currency, commodity or equity swap,
collar, cap, floor or forward rate agreement, or other agreement or arrangement
designed to protect a Person against fluctuations in interest rates, currency
exchange rates or commodity or equity prices or values (including any option
with respect to any of the foregoing and any combination of the foregoing
agreements or arrangements), and any confirmation execution in connection with
any such agreement or arrangement.

 

“HIPAA” means the Health Insurance Portability and Accountability Act of 1996
(as amended by the Health Information Technology for Economic and Clinical
Health Act (HITECH) of 2009), any and all rules or regulations promulgated from
time to time thereunder, and any state or federal laws with regards to the
security, privacy, or notification of breaches of the confidentiality of health
information which are not preempted pursuant to 45 C.F.R. Part 160, Subpart B.

 

“Indebtedness” means, with respect to any Person, without duplication: (a) all
indebtedness for advanced or borrowed money of, or credit extended to, such
Person; (b) all obligations issued, undertaken or assumed by such Person as the
deferred purchase price of assets, properties, services or rights (other than
(i) accrued expenses and trade payables entered into in the ordinary course of
business consistent with past practice which are not more than one hundred and
eighty (180) days past due or subject to a bona fide dispute, (ii) obligations
to pay for services provided by employees and individual independent contractors
in the ordinary course of business consistent with past practice which are not
more than one hundred and twenty (120) days past due or subject to a bona fide
dispute, (iii) liabilities associated with customer prepayments and deposits,
and (iv)(A) prepaid or deferred revenue arising in the ordinary course of
business consistent with past practice), including any obligation or liability
to pay deferred purchase price or other similar deferred consideration for such
assets, properties, services or rights where such deferred purchase price or
consideration becomes due and payable solely upon the passage of time, and (B)
any obligation described in clause (b) of the definition of “Contingent
Obligation” that is due and payable (or that becomes due and payable) solely
with the passage of time (and not upon the occurrence of an event or the
performance of an act); (c) the face amount of all letters of credit issued for
the account of such Person and, without duplication, all drafts drawn thereunder
and all reimbursement or payment obligations with respect to letters of credit,
surety bonds, performance bonds and other similar instruments issued by such
Person; (d) all obligations of such Person evidenced by notes, bonds, debentures
or other debt securities or similar instruments (including debt securities
convertible into Equity Interests), including obligations so evidenced incurred
in connection with the acquisition of properties, assets or businesses; (e) all
indebtedness of such Person created or arising under any conditional sale or
other title retention agreement or incurred as financing, in either case with
respect to property acquired by such Person (even though the rights and remedies
of the seller or bank under such agreement in the event of default are limited
to repossession or sale of such property); (f) all Capital Lease Obligations of
such Person; (g) the principal balance outstanding under any synthetic lease,
off-balance sheet loan or similar off balance sheet financing product by such
Person; (h) Disqualified Equity Interests; (i) all indebtedness referred to in
clauses (a) through (g) above of other Persons secured by (or for which the
holder of such indebtedness has an existing right, contingent or otherwise, to
be secured by) any Lien upon or in assets or properties (including accounts and
contracts rights) owned by such Person, even though such Person has not assumed
or become liable for the payment of such indebtedness of such other Persons; and
(j) all Contingent Obligations of such Person described in clause (a) of the
definition thereof (not including, for the avoidance of doubt, any purchase
price adjustment incurred pursuant to the Acquisition Agreement).

 

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“Indemnified Liabilities” means, collectively, any and all liabilities,
obligations, losses, damages (including natural resource damages), penalties,
claims, actions, judgments, suits, costs, reasonable and documented
out-of-pocket fees, expenses and disbursements of any kind or nature whatsoever
(including the reasonable and documented fees and disbursements of one counsel
for Indemnified Persons plus, if required, one local legal counsel in each
relevant material jurisdiction, and in the case of an actual or perceived
conflict of interest, one additional counsel for such affected Indemnified
Persons, in connection with any investigative, administrative or judicial
proceeding or hearing commenced or threatened in writing by any Person, whether
or not any such Indemnified Person shall have commenced such proceeding or
hearing or be designated as a party or a potential party thereto, and any fees
or expenses incurred by Indemnified Persons in enforcing the indemnity
hereunder), whether direct, indirect or consequential and whether based on any
federal, state or foreign laws, statutes, rules or regulations, on common law or
equitable cause or on contract or otherwise, that may be imposed on, incurred
by, or asserted against any such Indemnified Person, in any manner relating to
or arising out of this Agreement or the other Loan Documents or the transactions
contemplated hereby or thereby (including any Lender’s agreement to make Credit
Extensions or the use or intended use of the proceeds thereof, or any
enforcement of any of the Loan Documents (including any sale of, collection
from, or other realization upon any of the Collateral or the enforcement of any
guaranty of the Obligations)).

 

“Indemnified Person” is defined in Section 11.2(a).

 

“Indemnified Taxes” means (a) Taxes, other than Excluded Taxes, imposed on or
with respect to any payment made by or on account of any obligation of any
Credit Party under any Loan Document and (b) to the extent not otherwise
described in clause (a) above, Other Taxes.

 

“Insolvency Proceeding” means, with respect to any Person, any proceeding by or
against such Person under the United States Bankruptcy Code, or any other
bankruptcy or insolvency law, including assignments for the benefit of
creditors, compositions, extensions generally with its creditors, or proceedings
seeking reorganization, arrangement, or other relief.

 

“Intellectual Property” means all:

 

(a)       Copyrights, Trademarks, and Patents;

 

(b)       trade secrets and trade secret rights, including any rights to
unpatented inventions, know-how, show-how and operating manuals;

 

(c)       (i) all computer programs, including source code and object code
versions, (ii) all data, databases and compilations of data, whether machine
readable or otherwise, and (iii) all documentation, training materials and
configurations related to any of the foregoing (collectively, “Software”);

 

(d)       all right, title and interest arising under any contract or
Requirements of Law in or relating to Internet Domain Names;

 

(e)       design rights;

 

(f)       IP Ancillary Rights (including all IP Ancillary Rights related to any
of the foregoing); and

 

(g)       any similar or equivalent rights to any of the foregoing anywhere in
the world.

 

“Interest Date” means the last day of each calendar quarter.

 

“Interest Period” means, with respect to the Term Loans, (a) the period
commencing on (and including) the Closing Date and ending on (and including) the
first Interest Date following the Closing Date (provided, that if such Interest
Date is not a Business Day, the applicable Interest Period shall end on the
first Business Day immediately following such Interest Date), and (b)
thereafter, each period beginning on (and including) the first day immediately
following the end of the preceding Interest Period and ending on the earlier of
(and including) (x) the next Interest Date (provided, that if such Interest Date
is not a Business Day, the applicable Interest Period shall end on the first
Business Day immediately following such Interest Date) and (y) the Term Loan
Maturity Date.

 

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“Interest Rate Determination Date” means (a) initially, the Closing Date and (b)
thereafter, the first day of each Interest Period (or, if any such day is not a
Business Day, the first Business Day immediately following such day).

 

“Internet Domain Name” means all right, title and interest (and all related IP
Ancillary Rights) arising under any contract or Requirements of Law in or
relating to Internet domain names.

 

“Inventory” means all “inventory” as defined in the Code in effect on the date
hereof with such additions to such term as may hereafter be made, and includes
all merchandise, raw materials, parts, supplies, packing and shipping materials,
work in process and finished products, including such inventory as is
temporarily out of a Credit Party’s or Subsidiary’s custody or possession or in
transit and including any returned goods and any documents of title representing
any of the above.

 

“Investment” means (a) any beneficial ownership interest in any Person
(including Equity Interests), (b) any Acquisition or (c) the making of any
advance, loan, extension of credit or capital contribution in or to, any Person.

 

“IP Agreements” means, collectively, (a) those certain Intellectual Property
Security Agreements entered into by and between any Credit Party and the
Collateral Agent, each dated as of the Closing Date, and (b) any Intellectual
Property Security Agreement entered into by and between any Credit Party and the
Collateral Agent after the Closing Date in accordance with the Loan Documents.

 

“IP Ancillary Rights” means, with respect to any Copyright, Trademark, Patent,
Software, trade secrets or trade secret rights, including any rights to
unpatented inventions, know-how, show-how and operating manuals, collectively,
all income, royalties, proceeds and liabilities at any time due or payable or
asserted under or with respect to any of the foregoing or otherwise with respect
thereto, including all rights to sue or recover at law or in equity for any
past, present or future infringement, misappropriation, dilution, violation or
other impairment thereof.

 

“IRC” means the Internal Revenue Code of 1986.

 

“IRS” is defined in Section 2.6(d)(i)

 

“Knowledge” of Borrower means the actual knowledge, after reasonable
investigation, of the Responsible Officers of Borrower.

 

“Lender” means each Person signatory hereto as a “Lender” and its successors and
assigns.

 

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“Lender Expenses” means, collectively: (i) all reasonable and documented
out-of-pocket fees and expenses of the Collateral Agent and, as applicable, each
Lender (and their respective successors and assigns) and their respective
Related Parties (including the reasonable and documented out-of-pocket fees,
expenses and disbursements of any legal counsel for all such Persons taken as a
whole), (A) incurred in connection with developing, preparing, negotiating,
executing and delivering, and interpreting, investigating and administering, the
Loan Documents (or any term or provision thereof), any commitment, proposal
letter, letter of intent or term sheet therefor or any other document prepared
in connection therewith, (B) incurred in connection with the consummation and
administration of any transaction contemplated therein, (C) incurred in
connection with the performance of any obligation or agreement contemplated
therein, (D) incurred in connection with any modification or amendment of any
term or provision of or any supplement to or the termination (in whole or in
part) of, any Loan Document, (E) in connection with internal audit reviews and
Collateral audits and (F) otherwise incurred with respect to the Credit Parties
in connection with the Loan Documents, including any filing or recording fees
and expenses; and (ii) all reasonable and documented out-of-pocket costs and
expenses incurred by the Collateral Agent and each Lender (and their respective
successors and assigns) and their respective Related Parties (including the
reasonable and documented out-of-pocket fees, expenses and disbursements of any
legal counsel for all such Persons taken as a whole) in connection with (A) any
refinancing or restructuring of the credit arrangements provided hereunder in
the nature of a “work-out”, (B) the enforcement or preservation of any right or
remedy under any Loan Document, any Obligation, with respect to the Collateral
or any other related right or remedy or (C) the commencement, defense, conduct
of, intervention in, or the taking of any other action with respect to, any
proceeding (including any Insolvency Proceeding) related to any Credit Party or
any Subsidiary of any Credit Party in respect of any Loan Document or any
Obligation, or otherwise in connection with any Loan Document or any Obligation
(or the response to and preparation for any subpoena or request for document
production relating thereto). Notwithstanding any of the foregoing, none of the
out-of-pocket fees and expenses of the Collateral Agent or any Lender (or any of
their respective successors and assigns) or any of their respective Related
Parties incurred solely in connection with the exercise by the Collateral Agent
of its rights under Section 5.7(c)(ii)(z) shall constitute Lender Expenses.

 

“Lender Transfer” is defined in Section 11.1(b).

 

“LIBOR Rate” means, as of any Interest Rate Determination Date (and for the
Interest Period that follows such Interest Rate Determination Date), the rate
per annum equal to the London Interbank Offered Rate (“LIBOR”) appearing on
Reuters Page LIBOR01 (or any successor or substitute page) for three-month
Dollar deposits, or (b) if no such rate is available, the rate of interest
determined by the Collateral Agent to be the rate or the arithmetic mean of
rates at which Dollar deposits in immediately available funds are offered to
first-tier banks in the London interbank Eurodollar market, in either case under
clause (a) or (b) above, at approximately 11:00 a.m., London time, on such
Interest Rate Determination Date for a period of three (3) months; provided,
however, that for purposes of calculating the Interest Rate, the LIBOR Rate
shall at all times have a floor of two percent (2.00%).

 

“LIBOR Rate Replacement Date” means the earlier to occur of the following events
with respect to LIBOR:

 

(a)       in the case of clause (a) or (b)  of the definition of “LIBOR Rate
Transition Event,” the later of (i) the date of the public statement or
publication of information referenced therein and (ii) the date on which the
administrator of LIBOR permanently or indefinitely ceases to provide LIBOR; or

 

(b)       in the case of clause (c) of the definition of “LIBOR Rate Transition
Event,” the date of the public statement or publication of information
referenced therein.

 

“LIBOR Rate Transition Event” means the occurrence of one or more of the
following events with respect to LIBOR:

 

(a)       a public statement or publication of information has been made by or
on behalf of the administrator of LIBOR announcing that such administrator has
ceased or will cease to provide LIBOR, permanently or indefinitely, provided
that, at the time of such statement or publication, there is no successor
administrator that will continue to provide LIBOR;

 

(b)       a public statement or publication of information has been made by or
on behalf of the regulatory supervisor for the administrator of LIBOR, the U.S.
Federal Reserve System, an insolvency official with jurisdiction over the
administrator for LIBOR, a resolution authority with jurisdiction over the
administrator for LIBOR or a court or an entity with similar insolvency or
resolution authority over the administrator for LIBOR, which states that the
administrator of LIBOR has ceased or will cease to provide LIBOR permanently or
indefinitely, provided that, at the time of such statement or publication, there
is no successor administrator that will continue to provide LIBOR; or

 

(c)       a public statement or publication of information has been made by or
on behalf of the regulatory supervisor for the administrator of LIBOR announcing
that LIBOR is no longer representative.

 

“Lien” means a claim, mortgage, deed of trust, levy, charge, pledge, security
interest or other encumbrance of any kind or assignment for security purposes,
whether voluntarily incurred or arising by operation of law or otherwise against
any property or assets.

 

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“Loan Documents” means, collectively, this Agreement, the Disclosure Letter, the
Term Loan Notes, the Security Agreement, the IP Agreements, the Perfection
Certificate, any Control Agreement, any other Collateral Document, any
guaranties executed by a Guarantor in favor of the Collateral Agent for the
benefit of Lenders and the other Secured Parties in connection with this
Agreement, and any other present or future agreement between or among a Credit
Party, the Collateral Agent and any Lender in connection with this Agreement,
including, for the avoidance of doubt, any annexes, exhibits or schedules
thereto.

 

“Makewhole Amount” means, with respect to any prepayment of the Term Loans by
Borrower pursuant to Section 2.2(c) or as a result of the acceleration of the
maturity of the Term Loans pursuant to Section 8.1(a) occurring prior to the
2nd-year anniversary of the Closing Date, an amount equal to the sum of all
interest that would have accrued and been payable from the date of such
prepayment through the 2nd-year anniversary of the Closing Date on the aggregate
principal amount of the Term Loans prepaid.

 

“Managed Care Plans” means all health maintenance organizations, preferred
provider organizations, individual practice associations, competitive medical
plans and similar arrangements.

 

“Manufacturing Agreement” means any agreement entered into by any Credit Party
or any of its Subsidiaries with third parties (or that any Credit Party or any
of its Subsidiaries otherwise becomes a party to) for the commercial manufacture
or supply in the Territory of any Product (other than the Acquisition Products
prior to the Closing Date) for any indication in the United States or for the
commercial manufacture or supply of the active pharmaceutical ingredient
incorporated therein.

 

“Margin Stock” means “margin stock” within the meaning of Regulations U and X of
the Federal Reserve Board as now and from time to time hereafter in effect.

 

“Material Adverse Change” means any material adverse change in or effect on:
(i) the business, financial condition, prospects (solely with respect to the
ability of the Credit Parties to satisfy the financial covenant set forth in
Section 6.15 hereof), properties or assets (including all or any portion of
Collateral), liabilities (actual or contingent), operations, or performance of
the Credit Parties, taken as a whole; (ii) without limiting the generality of
clause (i) above, the rights of the Borrower and its Subsidiaries, taken as a
whole, in or related to the research, development, manufacture, production, use,
commercialization, marketing, importing, storage, transport, offer for sale,
distribution or sale of any Product in the Territory; (iii) the ability of the
Credit Parties, taken as a whole, to fulfill the payment or performance
obligations under this Agreement or any other Loan Document; or (iv) the binding
nature or validity of, or the ability of the Collateral Agent or any Lender to
enforce, any of the Loan Documents or any of its rights or remedies thereunder;
in each case described in clauses (i) through (iv) above, individually or taken
together with any other such change or effect.

 

“Material Contract” means any contract or other arrangement to which any Credit
Party or any of its Subsidiaries is a party (other than the Loan Documents) or
by which any of its assets or properties are bound, that in any way relates to
the research, development, manufacture, production, use, commercialization,
marketing, importing, storage, transport, offer for sale, distribution or sale
of any Product in the Territory, for which the breach thereof, default or
nonperformance thereunder, cancellation or termination thereof or the failure to
renew could reasonably be expected to result in a Material Adverse Change. For
the avoidance of doubt, each of the Acquisition Agreement, Current Company IP
Agreement, Transferred Contract (as defined in the Purchase Agreement), Current
Acquisition IP Agreement and Manufacturing Agreement shall be deemed a Material
Contract for all purposes hereunder, in each case unless and to the extent as
otherwise may be agreed by the Collateral Agent or Required Lenders.

 

“Medicaid” means the health care assistance program established by Title XIX of
the SSA (42 U.S.C. 1396 et seq.).

 

“Medicare” means the health insurance program for the aged and disabled
established by Title XVIII of the SSA (42 U.S.C. 1395 et seq.).

 

“Mortgage” means any deed of trust, leasehold deed of trust, mortgage, leasehold
mortgage, deed to secure debt, leasehold deed to secure debt or other document
creating a Lien on real estate or any interest in real estate.

 

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“Multiemployer Plan” means a multiemployer plan within the meaning of Section
4001(a)(3) or Section 3(37) of ERISA (a) to which Borrower or its Subsidiaries
or their respective ERISA Affiliates is then making or accruing an obligation to
make contributions; (b) to which Borrower or its Subsidiaries or their
respective ERISA Affiliates has within the preceding five (5) plan years made
contributions; or (c) with respect to which Borrower or its Subsidiaries would
reasonably be expected to incur material liability.

 

“Net Sales” means, as of any date of determination and solely with respect to
sales of the Products, the net consolidated product revenue (consistent with the
calculation of same in Borrower’s financial statements) of Borrower and its
Subsidiaries of Products for the twelve (12) months prior to such date
(excluding, for the avoidance of doubt, any (i) upfront or milestone payments
received by Borrower or any of its Subsidiaries, (ii) advancements, payments or
reimbursements of expenses of Borrower or any of its Subsidiaries, and (iii) any
other non-sales-based revenue or proceeds received by Borrower or any of its
Subsidiaries), determined on a consolidated basis in accordance with Applicable
Accounting Standards as set forth in Borrower’s financial statements or as
otherwise evidenced in a manner reasonably satisfactory to the Required Lenders.

 

“Obligations” means, collectively, the Credit Parties’ obligations to pay when
due any and all debts, principal, interest, Lender Expenses, the Additional
Consideration, the Makewhole Amount (if applicable), the Prepayment Premium (if
applicable) and any other fees, expenses, indemnities and amounts any Credit
Party owes any Lender or the Collateral Agent now or later, under this Agreement
or any other Loan Document, including interest accruing after Insolvency
Proceedings begin (whether or not allowed), and to perform Borrower’s duties
under the Loan Documents.

 

“OFAC” is defined in Section 4.18(c).

 

“Operating Documents” means, with respect to any Person, collectively, such
Person’s formation documents as certified with the Secretary of State or other
applicable Governmental Authority of such Person’s jurisdiction of formation on
a date that is no earlier than thirty (30) days prior to the date on which such
documents are due to be delivered under this Agreement, and (a) if such Person
is a corporation, its bylaws (or similar organizational regulations) in current
form, (b) if such Person is a limited liability company, its limited liability
company agreement (or similar agreement), and (c) if such Person is a
partnership, its partnership agreement (or similar agreement), including, for
the avoidance of doubt, all current amendments, restatements, supplements or
modifications thereto.

 

“Opioids Case” means any proceeding in any court of competent jurisdiction
alleging any cause of action or any violation of a Requirement of Law arising
from or related to the manufacture, production, distribution, marketing,
promotion or sale of opioid prescription drug products.

 

“ordinary course of business” means, in respect of any transaction involving any
Person, the ordinary course of such Person’s business, undertaken by such Person
in good faith and not for purposes of evading any covenant, prepayment
obligation or restriction in any Loan Document.

 

“Other Connection Taxes” means, with respect to any Lender, Taxes imposed as a
result of a present or former connection (including present or former connection
of its agents) between such Lender and the jurisdiction imposing such Tax (other
than connections arising from such Lender having executed, delivered, become a
party to, performed its obligations under, received payments under, received or
perfected a security interest under, engaged in any other transaction pursuant
to or enforced any Loan Document, or sold or assigned an interest in any Term
Loan or Loan Document).

 

“Other Taxes” means all present or future stamp, court or documentary,
intangible, recording, filing, mortgage or property Taxes, charges or similar
levies or similar Taxes that arise from any payment made hereunder, from the
execution, delivery, performance, enforcement or registration of, from the
receipt or perfection of a security interest under, or otherwise with respect
to, any Loan Document, except any such Taxes that are Other Connection Taxes
imposed with respect to a Lender Transfer.

 

“Participant Register” is defined in Section 11.1(e).

 

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“Patents” means all patents and patent applications (including any
continuations, continuations-in-part, divisions, provisionals or any substitute
applications), any patent issued with respect to any of the foregoing patent
applications, any reissue, reexamination, renewal or patent term extension or
adjustment (including any supplementary protection certificate) protection of
any such patent, and any confirmation patent or registration patent or patent of
addition based on any such patent, and all foreign and international
counterparts of any of the foregoing. For the avoidance of doubt, patents and
patent applications under this definition include all those filed with the U.S.
Patent and Trademark Office or which could be nationalized in the United States.

 

“Patriot Act” is defined in Section 3.1(i).

 

“Payment/Advance Request” means a Payment/Advance Request in substantially the
form attached hereto as Exhibit A.

 

“Payment Date” means, with respect to the Term Loans, (a) the 3rd-month
anniversary of the Closing Date, (b) the 6th-month anniversary of the Closing
Date, (c) the 9th-month anniversary of the Closing Date, (d) the 12th-month
anniversary of the Closing Date; (e) the 15th-month anniversary of the Closing
Date, (f) the 18th-month anniversary of the Closing Date, (g) the 21st-month
anniversary of the Closing Date, (h) the 24th-month anniversary of the Closing
Date, (i) the 27th-month anniversary of the Closing Date, (j) the 30th-month
anniversary of the Closing Date, (k) the 33rd-month anniversary of the Closing
Date, (l) the 36th-month anniversary of the Closing Date, (m) the 39th-month
anniversary of the Closing Date, (n) the 42nd-month anniversary of the Closing
Date, (o) the 45th-month anniversary of the Closing Date, and (p) the Term Loan
Maturity Date, as the context dictates.

 

“Perfection Certificate” is defined in Section 4.6.

 

“Permitted Acquisition” means any Acquisition (including, for the avoidance of
doubt, any inbound license), so long as:

 

(a)       no Default or Event of Default shall have occurred and be continuing
as of, or could reasonably be expected to result from, the consummation of such
Acquisition;

 

(b)       the properties or assets being acquired or licensed are useful in, or
the Person whose Equity Interests are being acquired is engaged in, as
applicable, (i) the same or a related line of business as that then-conducted by
Borrower or its Subsidiaries or (ii) a line of business that is ancillary to and
in furtherance of a line of business as that then-conducted by Borrower or its
Subsidiaries;

 

(c)       in the case of an Asset Acquisition, the subject properties or assets
are being acquired or licensed by a Credit Party, and, within the timeframes
expressly set forth in Section 5.12, such Credit Party shall have executed and
delivered or authorized, as applicable, any and all security agreements,
financing statements and any other documentation reasonably requested by the
Collateral Agent, in order to include the newly acquired or licensed properties
or assets within the Collateral to the extent required by Section 5.12;

 

(d)       in the case of a Stock Acquisition, the subject Equity Interests are
being acquired directly by a Credit Party, and such Credit Party shall have
complied with its obligations under Section 5.13 within the timeframes expressly
set forth therein; and

 

(e)       any Indebtedness or Liens assumed in connection with such Acquisition
are otherwise permitted under Section 6.4 or 6.5, respectively.

 

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“Permitted Convertible Indebtedness” means Indebtedness incurred by Borrower
having a feature which entitles the holder thereof to convert or exchange all or
a portion of such Indebtedness into Equity Interests in Borrower (or into any
combination of cash and such Equity Interests based on the value of such Equity
Interests); provided, that (i) such Indebtedness shall be unsecured, (ii) such
Indebtedness shall not be guaranteed by any Subsidiary of Borrower, (iii) such
Indebtedness shall be on substantially the terms set forth in the Preliminary
Prospectus Supplement or otherwise shall not include covenants and defaults that
are, taken as a whole, more restrictive on Borrower than the covenants and
defaults that are, taken as a whole, contained herein (as reasonably determined
by Borrower in its good faith judgment), (iv) other than in respect of the
issuance of convertible notes pursuant to the Preliminary Prospectus Supplement
on or about the Closing Date (or, with respect to any such Indebtedness issued
pursuant to the exercise of any related over-allotment option, no later than 40
calendar days after the date of the Preliminary Prospectus Supplement),
immediately prior to and after giving effect to the incurrence of such
Indebtedness, no Default or Event of Default shall have occurred and be
continuing or could reasonably be expected to occur as a result therefrom, (v)
such Indebtedness has a scheduled maturity date that is that is no earlier than
the Term Loan Maturity Date, and (vi) Borrower shall have delivered to the
Collateral Agent a certificate of a Responsible Officer of Borrower certifying
as to the foregoing with respect to such Indebtedness.

 

“Permitted Distributions” means:

 

(a)       dividends, distributions or other payments by any Wholly-Owned
Subsidiary on its Equity Interests to, or the redemption, retirement or purchase
by any Wholly-Owned Subsidiary of its Equity Interests from, Borrower or any
other Wholly-Owned Subsidiary;

 

(b)       dividends, distributions or other payments by any non-Wholly-Owned
Subsidiary on its Equity Interests to, or the redemption, retirement or purchase
by any non-Wholly-Owned Subsidiary of its Equity Interests from, Borrower or any
other Subsidiary or each other owner of such non-Wholly-Owned Subsidiary’s
Equity Interests based on their relative ownership interests of the relevant
class of such Equity Interests;

 

(c)       redemptions by Borrower in whole or in part any of its Equity
Interests for another class of its Equity Interests or rights to acquire its
Equity Interests or with proceeds from substantially concurrent equity
contributions or issuances of new Equity Interests;

 

(d)       any such payments arising from a Permitted Acquisition or a Permitted
Investment by Borrower or any of its Subsidiaries;

 

(e)       payments by any Credit Party or any Subsidiary of a Credit Party to
any Credit Party or any Subsidiary of a Credit Party pursuant to Tax sharing
agreements among the Credit Parties and their Subsidiaries on customary terms to
the extent attributable to the ownership or operation of the Credit Party and
their Subsidiaries;

 

(f)       the payment of dividends by Borrower solely in non-cash pay and
non-redeemable capital stock (including, for the avoidance of doubt, dividends
and distributions payable solely in Equity Interests);

 

(g)       cash payments in lieu of the issuance of fractional shares arising out
of stock dividends, splits or combinations or in connection with the exercise of
warrants, options or other securities convertible into or exchangeable for
Equity Interests;

 

(h)       in connection with any Acquisition or other Investment by Borrower or
any of its Subsidiaries, (i) the receipt or acceptance of the return to Borrower
or any of its Subsidiaries of Equity Interests of Borrower constituting a
portion of the purchase price consideration in settlement of indemnification
claims, or as a result of a purchase price adjustment (including earn-outs or
similar obligations) and (ii) payments or distributions to equity holders
pursuant to appraisal rights required under Requirements of Law;

 

(i)        the distribution of rights pursuant to any shareholder rights plan or
the redemption of such rights for nominal consideration in accordance with the
terms of any shareholder rights plan;

 

(j)       dividends, distributions or payments on its Equity Interests by any
Subsidiary to any Credit Party;

 

(k)       the conversion of convertible securities into other securities
pursuant to the terms of such convertible securities or otherwise in exchange
thereof;

 

(l)       dividends, distributions or payments on its Equity Interests by any
Subsidiary that is not a Credit Party to any other Subsidiary that is not a
Credit Party;

 

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(m)       purchases of Equity Interests of Borrower or its Subsidiaries in
connection with the exercise of stock options by way of cashless exercise, or in
connection with the satisfaction of withholding tax obligations;

 

(n)       issuance to directors, officers, employees or contractors of Borrower
of common stock of Borrower upon the vesting of restricted stock, restricted
stock units, or other rights to acquire common stock of Borrower pursuant to
plans or agreements approved by Borrower’s Board of Directors or stockholders;

 

(o)       the repurchase, retirement or other acquisition or retirement for
value of Equity Interests of Borrower or any of its Subsidiaries held by any
future, present or former employee, consultant, officer or director (or spouse,
ex-spouse or estate of any of the foregoing or trust for the benefit of any of
the foregoing or any lineal descendants thereof) of Borrower or any of its
Subsidiaries pursuant to any management equity plan or stock option plan or any
other management or employee benefit plan or agreement, or any stock
subscription or shareholder agreement or employment agreement; provided,
however, that the aggregate payments made under this clause (n) do not exceed in
any calendar year the sum of (i) $3,000,000 plus (ii) the amount of any payments
received in such calendar year under key-man life insurance policies; and

 

(p)       dividends or distributions on its Equity Interests by Borrower payable
solely in additional shares of its common stock within sixty (60) days after the
date of declaration thereof.

 

“Permitted Indebtedness” means:

 

(a)       Indebtedness of the Credit Parties to Secured Parties under this
Agreement and the other Loan Documents;

 

(b)       Indebtedness existing on the Closing Date, immediately after giving
effect to the consummation of the transactions contemplated by the Acquisition
Agreement, and shown on Schedule 12.2 of the Disclosure Letter;

 

(c)       [reserved];

 

(d)       Indebtedness not to exceed $10,000,000 in the aggregate at any time
outstanding, consisting of (i) Indebtedness incurred to finance the purchase,
construction, repair, or improvement of fixed assets and (ii) Capital Lease
Obligations;

 

(e)       Indebtedness in connection with corporate credit cards, purchasing
cards or bank card products;

 

(f)       [reserved];

 

(g)       Indebtedness assumed in connection with any Permitted Acquisition or
Permitted Investment, so long as (i) such Indebtedness was not incurred in
connection with, or in anticipation of, such Acquisition or Investment and (ii)
is at all times unsecured or Subordinated Debt;

 

(h)       Indebtedness of Borrower or any of its Subsidiaries with respect to
outstanding letters of credit entered into in the ordinary course of business
(including any obligation thereunder for undrawn amounts and for any drawings
thereunder) and secured solely by cash or cash equivalents;

 

(i)       Indebtedness owed (i) by a Credit Party to another Credit Party, (ii)
by a Subsidiary of Borrower that is not a Credit Party to another Subsidiary of
Borrower that is not a Credit Party, (iii) by a Credit Party to a Subsidiary of
Borrower that is not a Credit Party, or (iv) by a Subsidiary of Borrower that is
not a Credit Party to a Credit Party not to exceed $5,000,000 in the aggregate
at any time outstanding;

 

(j)       Indebtedness consisting of Contingent Obligations described in clause
(a) of the definition thereof (i) of a Credit Party of Permitted Indebtedness of
another Credit Party (or obligations that do not constitute Indebtedness
hereunder), (ii) of a Subsidiary of Borrower which is not a Credit Party of
Permitted Indebtedness (or obligations that do not constitute Indebtedness
hereunder) of another Subsidiary of Borrower which is not a Credit Party, (iii)
of a Subsidiary of Borrower which is not a Credit Party of Permitted
Indebtedness (or obligations that do not constitute Indebtedness hereunder) of a
Credit Party, or (iv) of a Credit Party of Permitted Indebtedness (or
obligations that do not constitute Indebtedness hereunder) of a Subsidiary of
Borrower which is not a Credit Party, provided that any and all such
Indebtedness consisting of such Contingent Obligations under this clause (iv)
does not exceed $5,000,000 in the aggregate at any time outstanding;

 

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(k)       Indebtedness consisting of Contingent Obligations described in clause
(b) of the definition thereof in connection with any Permitted Acquisition
(including any purchase price adjustment or indemnity payment incurred or
created pursuant to the Acquisition Agreement), Permitted Transfer or Permitted
Investment or otherwise in connection with any collaboration, development or
similar arrangement not otherwise prohibited hereunder, in each instance only if
such Indebtedness is due and payable upon the occurrence of an event or the
performance of an act (and not solely with the passage of time);

 

(l)        Indebtedness of any Person that becomes a Subsidiary (or of any
Person not previously a Subsidiary that is merged or consolidated with or into a
Subsidiary in a transaction permitted hereunder) of Borrower after the Effective
Date, or Indebtedness of any Person that is assumed after the Effective Date by
any Subsidiary in connection with an acquisition of assets by such Subsidiary;
provided, that, in each instance, such Indebtedness is not incurred in
contemplation of such transaction and is at all times unsecured or Subordinated
Debt;

 

(m)       (i) Indebtedness with respect to workers’ compensation claims, payment
obligations in connection with health, disability or other types of social
security benefits, unemployment or other insurance obligations, reclamation and
statutory obligations or (ii) Indebtedness related to employee benefit plans,
including annual employee bonuses, accrued wage increases and 401(k) plan
matching obligations, in each case described in clauses (i) and (ii) above,
incurred in the ordinary course of business consistent with past practice;

 

(n)      Indebtedness in respect of performance bonds, bid bonds, appeal bonds,
surety bonds and completion guarantees and similar obligations arising in the
ordinary course of business consistent with past practice;

 

(o)      Indebtedness in respect of netting services, overdraft protection and
other cash management services in the ordinary course of business consistent
with past practice;

 

(p)      Indebtedness consisting of the financing of insurance premiums in the
ordinary course of business consistent with past practice;

 

(q)      Indebtedness consisting of guarantees resulting from endorsement of
negotiable instruments for collection by any Credit Party in the ordinary course
of business consistent with past practice;

 

(r)       unsecured Indebtedness incurred in connection with any items of
Permitted Distributions in clause (o) of the definition of “Permitted
Distributions”;

 

(s)       (i) Permitted Convertible Indebtedness that does not have a scheduled
maturity date that is earlier than the Term Loan Maturity Date, not to exceed
$125,000,000 (as may be increased by the original principal amount of any such
Indebtedness issued pursuant to an over-allotment option, not to exceed
$20,000,000 in the aggregate) in the aggregate at any time outstanding; and (ii)
other Permitted Convertible Indebtedness that does not have a scheduled maturity
date that is earlier than 180 days after the Term Loan Maturity Date, not to
exceed $125,000,000 (as may be increased by the original principal amount of any
such Indebtedness issued pursuant to an over-allotment option, not to exceed
$20,000,000 in the aggregate) in the aggregate at any time outstanding; and

 

(t)       subject to the proviso immediately below, extensions, refinancings,
modifications, amendments, restatements and, solely in the case of any items of
Permitted Indebtedness in clause (b) above or any Permitted Indebtedness
constituting notes governed by an indenture, exchanges, of any items of
Permitted Indebtedness described in clauses (a) through (s) above, so long as,
in each instance, the principal amount thereof is not increased (other than by
any reasonable amount of premium (if any), interest (including post-petition
interest), fees, expenses, charges or additional or contingent interest
reasonably incurred in connection with the same and the terms thereof) and,
solely in the instance of any items of Permitted Indebtedness in clause (s)
above and any Subordinated Debt permitted under the definition of “Permitted
Indebtedness”, the maturity thereof is not shortened.

 

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Notwithstanding the foregoing, “Permitted Indebtedness” shall not include any
Hedging Agreements.

 

“Permitted Investments” means:

 

(a)       Investments (including Investments in Subsidiaries) existing on the
Effective Date (including giving pro forma effect to the consummation of the
transactions contemplated by the Acquisition Agreement) and shown on Schedule
12.3 of the Disclosure Letter, and any extensions, renewals or reinvestments
thereof;

 

(b)       Investments consisting of cash and Cash Equivalents;

 

(c)       Investments consisting of the endorsement of negotiable instruments
for deposit or collection or similar transactions in the ordinary course of
business consistent with past practice;

 

(d)      subject to Section 5.5, Investments consisting of deposit accounts or
securities accounts;

 

(e)       Investments in connection with Permitted Transfers;

 

(f)       Investments consisting of (i) travel advances and employee relocation
loans and other employee advances in the ordinary course of business consistent
with past practice, and (ii) loans to employees, officers or directors relating
to the purchase of equity securities of Borrower pursuant to employee stock
purchase plans or agreements approved by Borrower’s Board of Directors;

 

(g)      Investments (including debt obligations) received in connection with
the bankruptcy or reorganization of customers or suppliers and in settlement of
delinquent obligations of, and other disputes with, customers or suppliers
arising in the ordinary course of business consistent with past practice;

 

(h)      Investments consisting of notes receivable of, or prepaid royalties and
other credit extensions, to customers and suppliers who are not Affiliates, in
the ordinary course of business consistent with past practice; provided that
this clause (h) shall not apply to Investments of any Credit Party in any of its
Subsidiaries;

 

(i)        joint ventures or strategic alliances consisting of the non-exclusive
licensing of technology, the development of technology or the providing of
technical support;

 

(j)        Investments (i) required in connection with a Permitted Acquisition
(including the formation of any Subsidiary for the purpose of effectuating such
Permitted Acquisition, the capitalization of such Subsidiary whether by capital
contribution or intercompany loans, in each instance, to the extent otherwise
permitted by the terms of this Agreement, related Investments in Subsidiaries
necessary to consummate such Permitted Acquisition, and the receipt of any
non-cash consideration in a Permitted Acquisition), and (ii) consisting of
earnest money deposits required in connection with a Permitted Acquisition or
other acquisition of properties or assets not otherwise prohibited hereunder;

 

(k)       Investments constituting the formation of any Subsidiary for the
purpose of consummating a merger or acquisition transaction permitted by Section
6.3(a)(i) through (iv) hereof, which such transaction is otherwise a Permitted
Investment;

 

(l)        Investments of any Person that (i) becomes a Subsidiary of Borrower
(or of any Person not previously a Subsidiary of Borrower that is merged or
consolidated with or into a Subsidiary of Borrower in a transaction permitted
hereunder) after the Effective Date, or (ii) are assumed after the Effective
Date by any Subsidiary of Borrower in connection with an acquisition of assets
from such Person by such Subsidiary (including in connection with the
acquisition of the Purchased Assets pursuant to the Purchase Agreement), in
either case, in a Permitted Acquisition; provided, that in each instance, any
such Investment (x) exists at the time such Person becomes a Subsidiary of
Borrower (or is merged or consolidated with or into a Subsidiary of Borrower) or
such assets are acquired, (y) was not made in contemplation of or in connection
with such Person becoming a Subsidiary of Borrower (or merging or consolidating
with or into a Subsidiary of Borrower) or such acquisition of assets, and (z)
could not reasonably be expected to result in a Default or an Event of Default;

 

72

 

 

(m)      Investments arising as a result of the licensing of Intellectual
Property in the ordinary course of business consistent with past practice and
not prohibited hereunder;

 

(n)       Investments by (i) any Credit Party in any other Credit Party, (ii)
any Subsidiary of Borrower which is not a Credit Party in another Subsidiary of
Borrower which is not a Credit Party, (iii) any Subsidiary of Borrower which is
not a Credit Party in any Credit Party, and (iv) any Credit Party in a
Subsidiary of Borrower which is not a Credit Party not to exceed $10,000,000 in
the aggregate per fiscal year;

 

(o)       Repurchases of capital stock of Borrower or any of its Subsidiaries
deemed to occur upon the exercise of options, warrants or other rights to
acquire capital stock of Borrower or such Subsidiary solely to the extent that
shares of such capital stock represent a portion of the exercise price of such
options, warrants or such rights;

 

(p)       Repurchases of capital stock constituting Permitted Distributions; and

 

(q)       Repurchases or redemptions of Indebtedness not prohibited under
Section 6.4;

 

provided, however, that, none of the foregoing Investments shall be a “Permitted
Investment” if any Indebtedness or Liens assumed in connection with such
Investment are not otherwise permitted under Section 6.4 or 6.5, respectively.

 

Notwithstanding the foregoing, “Permitted Investments” shall not include any
Hedging Agreements.

 

“Permitted Licenses” means, collectively: (a) any non-exclusive license or
covenant not to sue in any geography world-wide, or any exclusive license or
covenant not to sue as to a geography other than the U.S., of or with respect to
any Intellectual Property, or a non-exclusive grant, or an exclusive grant as to
a geography other than the U.S., of development, manufacturing, production,
commercialization, marketing, co-promotion, distribution, sale or similar
commercial rights with respect to any Product; and (b) any intercompany licenses
or other similar arrangements among Credit Parties. Notwithstanding the
foregoing or any other provision of this Agreement, no Excluded License entered
into after the Closing Date shall be a “Permitted License” hereunder without the
prior written consent thereto of the Collateral Agent or the Required Lenders.

 

“Permitted Liens” means:

 

(a)       Liens securing the Obligations pursuant to any Loan Document;

 

(b)      Liens existing on the Closing Date and set forth on Schedule 12.4 of
the Disclosure Letter;

 

(c)       Liens for Taxes, assessments or governmental charges (i) which are not
yet delinquent or (ii) which are being contested in good faith and by
appropriate proceedings promptly instituted and diligently conducted; provided
that adequate reserves therefor have been set aside on the books of the
applicable Person and maintained in conformity with Applicable Accounting
Standards, if required; provided, further, that in the case of a Tax, assessment
or charge that has or may become a Lien against any Collateral, such contest
proceedings conclusively operate to stay the sale or forfeiture of any portion
of any Collateral to satisfy such Tax, assessment or charge;

 

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(d)       Pledges, deposits or Liens arising as a matter of law in the ordinary
course of business (other than Liens imposed by ERISA) in connection with
workers’ compensation, payroll taxes, unemployment insurance, old-age pensions,
or other similar social security legislation, (ii) pledges or deposits made in
the ordinary course of business consistent with past practice securing liability
for reimbursement or indemnification obligations of (including obligations in
respect of letters of credit or bank guarantees for the benefit of) insurance
carriers providing property, casualty or liability insurance to Borrower or any
of its Subsidiaries, (iii) subject to Section 6.2(b), statutory or common law
Liens of landlords and pledges and deposits in the ordinary course of business
securing liability to landlords (including obligations in respect of letters of
credit or bank guarantees for the benefit of landlords), and (iv) pledges or
deposits to secure performance of tenders, bids, leases, statutory or regulatory
obligations, surety and appeal bonds, government contracts, performance and
return-of-money bonds and other obligations of like nature, in each case, other
than for borrowed money and entered into in the ordinary course of business
consistent with past practice;

 

(e)       Liens arising from attachments or judgments, orders, or decrees in
circumstances not constituting an Event of Default under either Section 7.4 or
7.7;

 

(f)       Liens (including the right of set-off) in favor of banks or other
financial institutions incurred on deposits made in accounts held at such
institutions in the ordinary course of business; provided that such Liens (i)
are not given in connection with the incurrence of any Indebtedness, (ii) relate
solely to obligations for administrative and other banking fees and expenses
incurred in the ordinary course of business in connection with the establishment
or maintenance of such accounts and (iii) are within the general parameters
customary in the banking industry;

 

(g)      Liens that are contractual rights of set-off (i) relating to pooled
deposit or sweep accounts of Borrower or any of its Subsidiaries to permit
satisfaction of overdraft or similar obligations incurred in the ordinary course
of business consistent with past practice or (ii) relating to purchase orders
and other agreements entered into with customers of Borrower or any of its
Subsidiaries in the ordinary course of business consistent with past practice;

 

(h)      Liens solely on any cash earnest money deposits made by Borrower or any
of its Subsidiaries in connection with any Permitted Acquisition or Permitted
Investment;

 

(i)        Liens existing after the Closing Date (other than those described in
clause (b) above) on any asset or property at the time of its acquisition or on
the assets or properties of any Person at the time such Person becomes a
Subsidiary of Borrower; provided, that, in each case (i) neither such Lien was
created nor the Indebtedness secured thereby was incurred in contemplation of
such acquisition or such Person becoming a Subsidiary of Borrower, (ii) such
Lien does not extend to or cover any other assets or properties (other than the
proceeds or products thereof and other than after-acquired assets or properties
subject to a Lien securing Indebtedness and other obligations incurred prior to
such time and which Indebtedness and other obligations are permitted hereunder
that requires, pursuant to its terms and conditions in effect at such time, a
pledge of after-acquired assets or properties, it being understood that such
requirement shall not be permitted to apply to any assets or properties to which
such requirement would not have applied but for such acquisition), (iii) the
Indebtedness and any other obligations secured thereby is permitted under
Section 6.4 hereof, and (iv) such Lien is of the type otherwise permitted under
Section 6.5 hereof;

 

(j)        Liens on insurance policies and the proceeds thereof securing the
financing of the premiums with respect thereto;

 

(k)       Liens securing Indebtedness permitted under clause (d) of the
definition of “Permitted Indebtedness” (including any extensions, refinancings,
modifications, amendments or restatements of such Indebtedness permitted under
clause (t) of the definition of “Permitted Indebtedness”); provided, that, in
each instance, such Lien does not extend to or cover any assets or properties
other than those that are subject to such Capital Lease Obligations or acquired
with such Indebtedness;

 

(l)        rights of first refusal, voting, redemption, transfer or other
restrictions (including call provisions and buy-sell provisions) with respect to
the Equity Interests of any joint venture or other Persons that are not
Subsidiaries;

 

(m)       servitudes, easements, rights-of-way, restrictions and other similar
encumbrances on real property imposed by Requirements of Law and encumbrances
consisting of zoning or building restrictions, easements, licenses, restrictions
on the use of property or minor defects or other irregularities in title which,
in the aggregate, are not material, and which do not in any case materially
detract from the value of the property subject thereto or interfere with the
ordinary conduct of the business of any Credit Party or any Subsidiary of any
Credit Party;

 

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(n)       to the extent constituting a Lien, escrow arrangements securing
indemnification obligations associated with any Permitted Acquisition or
Permitted Investment;

 

(o)       licenses, sublicenses, leases or subleases of personal property (other
than relating to Intellectual Property) granted to third parties in the ordinary
course of business consistent with past practice which, in each instance, do not
interfere in any material respect with the operations of the business of any
Credit Party or any of its Subsidiaries and do not prohibit granting the
Collateral Agent a security interest therein for the benefit of Lenders and the
other Secured Parties;

 

(p)       Permitted Licenses;

 

(q)       Liens on cash or other current assets pledged to secure (i)
Indebtedness in respect of corporate credit cards, purchasing cards or bank card
products or (ii) Indebtedness in the form of letters of credit or bank
guarantees;

 

(r)       Liens on any properties or assets of Borrower or any of its
Subsidiaries which do not constitute Collateral under the Loan Documents,
including any of the Excluded Property, other than Company IP or Acquisition IP
relating in any way to any research, development, manufacture, production, use,
commercialization, marketing, importing, storage, transport, offer for sale,
distribution or sale of any Product in the Territory that does not constitute
Collateral, if any;

 

(s)       Liens on properties or assets of Borrower or any of its Subsidiaries
imposed by law or regulation which were incurred in the ordinary course of
business, including landlords’, carriers’, warehousemen’s, mechanics’,
materialmen’s, contractors’, suppliers of materials’, architects’ and
repairmen’s Liens, and other similar Liens arising in the ordinary course of
business consistent with past practice; provided that such Liens (i) do not
materially detract from the value of such properties or assets subject thereto
or materially impair the use of such properties or assets subject thereto in the
operations of the business of Borrower or such Subsidiary or (ii) are being
contested in good faith by appropriate proceedings, which conclusively operate
to stay the sale or forfeiture of any portion of such properties or assets
subject thereto and for which adequate reserves have been set aside on the books
of the applicable Person and maintained in conformity with Applicable Accounting
Standards, if required;

 

(t)       Liens on funds escrowed in connection with the consummation of the
transactions contemplated by the Acquisition Agreement or other Permitted
Acquisitions; and

 

(u)       subject to the provisos immediately below, the modification,
replacement, extension or renewal of the Liens described in clauses (a) through
(s) above; provided, however, that any such modification, replacement, extension
or renewal must (i) be limited to the assets or properties encumbered by the
existing Lien (and any additions, accessions, parts, improvements and
attachments thereto and the proceeds thereof) and (ii) not increase the
principal amount of any Indebtedness secured by the existing Lien (other than by
any reasonable premium or other reasonable amount paid and fees and expenses
reasonably incurred in connection therewith); provided, further, that to the
extent any of the Liens described in clauses (a) through (s) above secure
Indebtedness of a Credit Party, such Liens, and any such modification,
replacement, extension or renewal thereof, shall constitute Permitted Liens if
and only to the extent that such Indebtedness is permitted under Section 6.4
hereof.

 

“Permitted Negative Pledges” means:

 

(a)       prohibitions or limitations with regards to specific properties or
assets encumbered by Permitted Liens, if and only to the extent each such
prohibition or limitation applies only to such properties or assets;

 

(b)      prohibitions or limitations set forth in any lease, license or other
similar agreement entered into in the ordinary course of business and not
prohibited hereunder;

 

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(c)       prohibitions or limitations relating to Permitted Indebtedness, in the
case of each such agreement if and only to the extent such prohibitions or
limitations, taken as a whole, are not materially more restrictive than the
prohibitions and limitations set forth in this Agreement and the other Loan
Documents, taken as a whole (as reasonably determined by a Responsible Officer
of Borrower in good faith);

 

(d)      customary provisions restricting assignments, subletting, sublicensing
or other transfer of properties or assets subject thereto set forth in leases,
subleases, licenses (including Permitted Licenses) and other similar agreements
that are not otherwise prohibited under this Agreement or any other Loan
Document, if and only to the extent each such restriction applies only to the
properties or assets subject to such leases, subleases, licenses or agreements,
and customary provisions restricting assignment, pledges or transfer of any
agreement entered into in the ordinary course of business consistent with past
practice;

 

(e)       prohibitions or limitations imposed by Requirements of Law;

 

(f)       prohibitions or limitations that exist as of the Effective Date under
any items of Permitted Indebtedness in clause (b) of the definition of
“Permitted Indebtedness”;

 

(g)      customary prohibitions or limitations arising in connection with any
Permitted Transfer or contained in any contract or agreement relating to any
Permitted Transfer pending the consummation of such Transfer;

 

(h)      customary provisions in shareholders’ agreements, joint venture
agreements, organizational documents or similar binding agreements relating to,
or any agreement evidencing Indebtedness of, any joint venture entity or
non-Wholly-Owned Subsidiary and applicable solely to such joint venture entity
or non-Wholly-Owned Subsidiary and the Equity Interests issued thereby;

 

(i)        customary net worth provisions set forth in real property leases
entered into by Subsidiaries of Borrower, so long as such net worth provisions
would not reasonably be expected to impair the ability of Borrower or its
Subsidiaries to meet their ongoing obligations (as reasonably determined by a
Responsible Officer of Borrower in good faith);

 

(j)        customary net worth provisions set forth in customer agreements
entered into in the ordinary course of business consistent with past practice
that are not otherwise prohibited under this Agreement or any other Loan
Document, so long as such net worth provisions would not reasonably be expected
to impair the ability of Borrower or its Subsidiaries to meet their ongoing
obligations (as reasonably determined by a Responsible Officer of Borrower in
good faith);

 

(k)       restrictions on cash or other deposits (including escrowed funds)
imposed by agreements entered into in the ordinary course of business consistent
with past practice that are not otherwise prohibited under this Agreement or any
other Loan Document;

 

(l)        prohibitions or limitations set forth in any agreement in effect at
the time any Person becomes a Subsidiary (but not any amendment, modification,
restatement, renewal, extension, supplement or replacement expanding the scope
of any such restriction or condition); provided that such agreement was not
entered into in contemplation of such Person becoming a Subsidiary and each such
prohibition or limitation does not apply to Borrower or any other Subsidiary
(other than such Person and any other Person that is a Subsidiary of such first
Person at the time such first Person becomes a Subsidiary);

 

(m)       prohibitions or limitations imposed by any Loan Document;

 

(n)       customary provisions set forth in joint venture agreements or
agreements governing minority investments that are not otherwise prohibited by
this Agreement or any other Loan Document, if and only to the extent each such
prohibition or limitation applies only to the joint venture entity or minority
investment that is the subject of such agreement;

 

(o)       limitations imposed with respect to any license acquired in a
Permitted Acquisition;

 

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(p)       customary provisions restricting assignments or other transfer of
properties or assets subject thereto set forth in any agreement entered into in
the ordinary course of business consistent with past practice, if and only to
the extent each such restriction applies only to the properties or assets
subject to such agreement;

 

(q)       prohibitions or limitations imposed by any contract or agreement
evidencing any Permitted Indebtedness of the type described in clause (d) of the
definition of “Permitted Indebtedness”; and

 

(r)       prohibitions or limitations imposed by any amendments, modifications,
restatements, renewals, extensions, supplements or replacements of any of the
agreements referred to in clauses (a) through (q) above, except to the extent
that any such amendment, modification, restatement, renewal, extension,
supplement or replacement expands the scope of any such prohibition or
limitation.

 

“Permitted Subsidiary Distribution Restrictions” means, in each case
notwithstanding Section 6.8:

 

(a)       prohibitions or limitations with regards to specific properties or
assets encumbered by Permitted Liens, if and only to the extent each such
prohibition or limitation applies only to such properties or assets;

 

(b)       prohibitions or limitations set forth in any lease, license or other
similar agreement not prohibited hereunder;

 

(c)       prohibitions or limitations relating to Permitted Indebtedness, in the
case of each such agreement if and only to the extent such prohibitions or
limitations, taken as a whole, are not materially more restrictive than the
prohibitions and limitations set forth in this Agreement and the other Loan
Documents, taken as a whole (as reasonably determined by a Responsible Officer
of Borrower in good faith);

 

(d)       customary provisions restricting assignments, subletting, sublicensing
or other transfer of properties or assets subject thereto set forth in leases,
subleases, licenses (including Permitted Licenses) and other similar agreements
that are not otherwise prohibited under this Agreement or any other Loan
Document, if and only to the extent each such restriction applies only to the
properties or assets subject to such leases, subleases, licenses or agreements,
and customary provisions restricting assignment, pledges or transfer of any
agreement entered into in the ordinary course of business consistent with past
practice;

 

(e)       prohibitions or limitations on the transfer or assignment of any
properties, assets or Equity Interests set forth in any agreement entered into
in the ordinary course of business consistent with past practice that is not
otherwise prohibited under this Agreement or any other Loan Document, if and
only to the extent each such prohibition or limitation applies only to such
properties, assets or Equity Interests;

 

(f)       prohibitions or limitations imposed by Requirements of Law;

 

(g)       prohibitions or limitations that exist as of the Effective Date under
any Permitted Indebtedness of the type described in clause (b) of the definition
of “Permitted Indebtedness”;

 

(h)       customary prohibitions or limitations arising in connection with any
Permitted Transfer or contained in any contract or agreement relating to any
Permitted Transfer pending the consummation of such Transfer;

 

(i)        customary provisions in shareholders’ agreements, joint venture
agreements, organizational documents or similar binding agreements relating to,
or any agreement evidencing Indebtedness of, any joint venture entity or
non-Wholly-Owned Subsidiary and applicable solely to such joint venture entity
or non-Wholly-Owned Subsidiary and the Equity Interests issued thereby;

 

(j)        customary net worth provisions set forth in real property leases
entered into by Subsidiaries of Borrower, so long as such net worth provisions
would not reasonably be expected to impair the ability of Borrower or its
Subsidiaries to meet their ongoing obligations (as reasonably determined by a
Responsible Officer of Borrower in good faith);

 

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(k)       customary net worth provisions set forth in customer agreements
entered into in the ordinary course of business consistent with past practice
that are not otherwise prohibited under this Agreement or any other Loan
Document, so long as such net worth provisions would not reasonably be expected
to impair the ability of Borrower or its Subsidiaries to meet their ongoing
obligations (as reasonably determined by a Responsible Officer of Borrower in
good faith);

 

(l)        restrictions on cash or other deposits (including escrowed funds)
imposed by agreements entered into in the ordinary course of business consistent
with past practice that are not otherwise prohibited under this Agreement or any
other Loan Document;

 

(m)       prohibitions or limitations set forth in any agreement in effect at
the time any Person becomes a Subsidiary (but not any amendment, modification,
restatement, renewal, extension, supplement or replacement expanding the scope
of any such restriction or condition); provided that such agreement was not
entered into in contemplation of such Person becoming a Subsidiary and each such
prohibition or limitation does not apply to Borrower or any other Subsidiary
(other than such Person and any other Person that is a Subsidiary of such first
Person at the time such first Person becomes a Subsidiary);

 

(n)       prohibitions or limitations imposed by any Loan Document;

 

(o)       customary provisions set forth in joint venture agreements or
agreements governing minority investments that are not otherwise prohibited by
this Agreement or any other Loan Document, if and only to the extent each such
prohibition or limitation applies only to the joint venture entity or minority
investment that is the subject of such agreement;

 

(p)       customary provisions restricting assignments or other transfer of
properties or assets subject thereto set forth in any agreement entered into in
the ordinary course of business consistent with past practice, if and only to
the extent each such restriction applies only to the properties or assets
subject to such agreement;

 

(q)       prohibitions or limitations imposed by any agreement evidencing any
Permitted Indebtedness of the type described in any of clause (d) of the
definition of “Permitted Indebtedness”; and

 

(r)       prohibitions or limitations imposed by any amendments, modifications,
restatements, renewals, extensions, supplements or replacements of any of the
agreements referred to in clauses (a) through (q) above, except to the extent
that any such amendment, modification, restatement, renewal, extension,
supplement or replacement expands the scope of any such prohibition or
limitation.

 

“Permitted Transfers” means:

 

(a)       Transfers of any properties or assets which do not constitute
Collateral under the Loan Documents, other than any Company IP or Acquisition IP
that does not constitute Collateral under the Loan Documents but is related in
any way to the research, development, manufacture, production, use,
commercialization, marketing, importing, storage, transport, offer for sale,
distribution or sale of any Product in the Territory;

 

(b)       Transfers of Inventory in the ordinary course of business consistent
with past practice;

 

(c)       Transfers of surplus, damaged, worn out or obsolete equipment that is,
in the reasonable judgment of Borrower exercised in good faith, no longer
economically practicable to maintain or useful in the ordinary course of
business consistent with past practice, and Transfers of other properties or
assets in lieu of any pending or threatened institution of any proceedings for
the condemnation or seizure of such properties or assets or for the exercise of
any right of eminent domain;

 

(d)       Transfers made in connection with Permitted Liens;

 

(e)       Transfers of cash and Cash Equivalents in a manner that is not
prohibited by the terms of this Agreement or the other Loan Documents;

 

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(f)       Transfers (i) between or among Credit Parties, provided that, with
respect to any properties or assets constituting Collateral under the Loan
Documents, any and all steps as may be required to be taken in order to create
and maintain a first priority security interest in and Lien upon such properties
and assets in favor of the Collateral Agent for the benefit of Lenders and the
other Secured Parties are taken contemporaneously with the completion of any
such transfer, and (ii) between or among Subsidiaries which are not Credit
Parties;

 

(g)       the sale or issuance of Equity Interests in any Subsidiary of Borrower
to any Credit Party or Subsidiary, provided, that any such sale or issuance by a
Credit Party shall be to another Credit Party;

 

(h)       the sale or discount without recourse of accounts receivable arising
in the ordinary course of business consistent with past practice in connection
with the compromise or collection thereof;

 

(i)       any abandonment, cancellation, non-renewal or discontinuance of use or
maintenance of Company IP or Acquisition IP that Borrower reasonably determines
in good faith (i) is no longer economically practicable to maintain or useful in
the ordinary course of business consistent with past practice and that (ii)
would not reasonably be expected to be adverse to the rights, remedies and
benefits available to, or conferred upon, Lender under any Loan Document in any
material respect; and

 

(j)       Transfers by Borrower or any of its Subsidiaries pursuant to any
Permitted License.

 

“Person” means any individual, sole proprietorship, partnership, limited
liability company, joint venture, company, trust, unincorporated organization,
association, corporation, institution, public benefit corporation, firm, joint
stock company, estate, entity or government agency.

 

“Plan” means any employee pension benefit plan (other than a Multiemployer Plan)
subject to the provisions of Title IV of ERISA or Section 412 of the IRC or
Section 302 of ERISA which is maintained or contributed to by Borrower or its
Subsidiaries or their respective ERISA Affiliates or with respect to which
Borrower or its Subsidiaries have any liability (including under Section 4069 of
ERISA).

 

“Preliminary Prospectus Supplement” means the Preliminary Prospectus Supplement
for the offering by Borrower of convertible notes, substantially in the form
provided to the Collateral Agent on the Effective Date.

 

“Prepayment Premium” means, as applicable, (i) the Equity Proceeds Prepayment
Premium or (ii) the General Prepayment Premium.

 

“Product” means, collectively, (i) Xtampza® ER, (ii) any successor to Xtampza®
ER, (iii) the Acquisition Products, (iv) any successor to any Acquisition
Product, and (v) any other pharmaceutical, biologic or medical device products
sold or out-licensed by any Credit Party or its Subsidiaries at any time after
the Effective Date.

 

“Purchased Assets” has the meaning assigned to such term in the Purchase
Agreement.

 

“Register” is defined in Section 2.8(a).

 

“Registered Organization” means any “registered organization” as defined in the
Code with such additions to such term as may hereafter be made.

 

“Regulatory Agency” means a U.S. Governmental Authority with responsibility for
the approval of the marketing and sale of pharmaceuticals or other regulation of
pharmaceuticals, including the FDA and the DEA.

 

“Regulatory Approval” means all approvals, product or establishment licenses,
registrations or authorizations of any Regulatory Agency necessary for the
manufacture, use, storage, import, export, transport, offer for sale, or sale of
any Product.

 

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“Related Parties” means, with respect to any Person, such Person’s Affiliates
and the partners, directors, officers, employees, agents, trustees,
administrators, managers, advisors and representatives of such Person and of
such Person’s Affiliates.

 

“Release” means any release, spill, emission, leaking, pumping, pouring,
injection, escaping, deposit, disposal, discharge, dispersal, dumping, leaching
or migration of any Hazardous Material into the indoor or outdoor environment
(including the abandonment or disposal of any barrels, containers or other
closed receptacles containing any Hazardous Material), including the movement of
any Hazardous Material through the air, soil, surface water or groundwater, in
each case, in the United States.

 

“Required Lenders” means, at any time of determination (a) prior to the Closing
Date, Lenders obligated with respect to greater than fifty percent (50%) of the
Term Loan Commitments, and (b) thereafter, Lenders representing greater than
fifty percent (50%) of the sum of the outstanding principal amount of the Term
Loans at such time.

 

“Requirements of Law” means, as to any Person, (a) the organizational or
governing documents of such Person, and (b) any law (statutory or common),
treaty, order, policy, rule or regulation or determination of an arbitrator or a
court or other Governmental Authority (including Health Care Laws, Data
Protection Laws, FDA Laws, DEA Laws, and all applicable statutes, rules,
regulations, standards, guidelines, policies and orders administered or issued
by any foreign Governmental Authority) that is applicable to and binding upon
such Person or any of its assets or properties, or to which such Person or any
of its assets or properties are subject.

 

“Responsible Officers” means, with respect to Borrower, collectively, the Chief
Executive Officer, President, Chief Commercial Officer, Chief Compliance
Officer, Chief Marketing Officer, Chief Technology Officer, General Counsel, and
Chief Financial Officer.

 

“Restricted License” means any material license or other agreement of the kind
or nature subject or purported to be subject from time to time to a Lien under
any Collateral Document, with respect to which a Credit Party is the licensee,
(a) that prohibits or otherwise restricts such Credit Party from granting a
security interest in such Credit Party’s interest in such license or agreement
in a manner enforceable under Requirements of Law, or (b) for which a breach of
or default under would reasonably be expected to interfere with the Collateral
Agent’s or any Lender’s right to sell any Collateral.

 

“Safety Notice” is defined in Section 4.19(f).

 

“Sanctions” is defined in Section 4.18(c).

 

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

 

“Secured Parties” means each Lender, each other Indemnified Person and each
other holder of any Obligation of a Credit Party.

 

“Securities Account” means any “securities account” as defined in the Code with
such additions to such term as may hereafter be made.

 

“Securities Act” means the Securities Act of 1933.

 

“Security Agreement” means the Guaranty and Security Agreement, dated as of the
Closing Date, by and among the Credit Parties and the Collateral Agent, in form
and substance substantially similar to Exhibit C attached hereto or in such form
or substance as the Credit Parties and the Collateral Agent may otherwise agree.

 

“Security Disclosure Letter” means the “Security Disclosure Letter”, as such
term is defined in the Security Agreement.

 

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“Solvent” means, with respect to any Person as of any date of determination,
that, as of such date, (a) the value of the assets (including goodwill minus
disposition costs) of such Person (both at fair value and present fair saleable
value), on a going concern basis, is greater than the total amount of
liabilities (including contingent and unliquidated liabilities) of such Person,
(b) such Person is able to generally pay all liabilities (including trade debt)
of such Person as such liabilities become absolute and mature in the ordinary
course of business consistent with past practice and (c) such Person does not
have unreasonably small capital after giving due consideration to the prevailing
practice in the industry in which it is engaged or will be engaged. In computing
the amount of contingent or unliquidated liabilities at any time, such
liabilities shall be computed at the amount that, in light of all the facts and
circumstances existing at such time, represents the amount that can reasonably
be expected to become an actual or matured liability.

 

“Specified Acquisition Agreement Representations” means the representations and
warranties with respect to the Purchased Assets and the Assumed Liabilities made
by or on behalf of Assertio Therapeutics, Inc. in the Acquisition Agreement as
are material to the interests of the Collateral Agent or Lenders, but only to
the extent that Borrower has the right (determined without regard to any notice
requirement) to terminate its obligations under the Acquisition Agreement or to
decline to consummate the acquisition of the Purchased Assets or the assumption
of the Assumed Liabilities pursuant to the Purchase Agreement, without the
incurrence of any liabilities or obligations, as a result of a breach of any
such representations or warranties, as determined without giving effect to any
waiver, amendment, consent or other modification thereto.

 

“Specified Disputes” is defined in Section 4.7(b).

 

“SSA” means the Social Security Act of 1935, codified at Title 42, Chapter 7, of
the United States Code.

 

“Stock Acquisition” means the purchase or other acquisition by Borrower or any
of its Subsidiaries of all of the Equity Interests (by merger, stock purchase or
otherwise) in any other Person.

 

“Subordinated Debt” means any Indebtedness in the form of or otherwise
constituting term debt incurred by any Credit Party or any Subsidiary thereof
(including any Indebtedness incurred in connection with any Acquisition or other
Investment) that: (a) is subordinated in right of payment to the Obligations at
all times until all of the Obligations have been paid, performed or discharged
in full and Borrower has no further right to obtain any Credit Extension
hereunder pursuant to a subordination, intercreditor or other similar agreement
that is in form and substance reasonably satisfactory to the Collateral Agent
(which agreement shall include turnover provisions that are reasonably
satisfactory to the Collateral Agent); (b) except as permitted by clause (d)
below or otherwise permitted, is not subject to scheduled amortization,
redemption (mandatory), sinking fund or similar payment and does not have a
final maturity before a date that is at least one hundred and twenty (120) days
following the Term Loan Maturity Date; (c) does not include covenants (including
financial covenants) and agreements (excluding agreements with respect to
maturity, amortization, pricing and other economic terms) that, taken as a
whole, are more restrictive or onerous on the Credit Parties in any material
respect than the comparable covenants and agreements, taken as a whole, in the
Loan Documents (as reasonably determined by a Responsible Officer of Borrower in
good faith); (d) is not subject to repayment or prepayment, including pursuant
to a put option exercisable by the holder of any such Indebtedness, prior to a
date that is at least one hundred and twenty (120) days following the Term Loan
Maturity Date except in the case of an event of default or change of control (or
the equivalent thereof, however described); and (e) does not provide or
otherwise include provisions having the effect of providing that a default or
event of default (or the equivalent thereof, however described) under or in
respect of such Indebtedness shall exist, or such Indebtedness shall otherwise
become due prior to its scheduled maturity or the holder or holders thereof or
any trustee or agent on its or their behalf shall be permitted (with or without
the giving of notice, the lapse of time or both) to cause any such Indebtedness
to become due, or to require the prepayment, repurchase, redemption or
defeasance thereof, prior to its scheduled maturity, in any such case upon the
occurrence of a Default or Event of Default hereunder unless and until the
Obligations have been declared, or have otherwise automatically become,
immediately due and payable pursuant to Section 8.1(a).

 

81

 

 

“Subsidiary” means, with respect to any Person, a corporation, partnership,
limited liability company or other entity of which more than fifty percent
(50.0%) of whose shares of stock or other ownership interests having ordinary
voting power (other than stock or such other ownership interests having such
power only by reason of the happening of a contingency) to elect a majority of
the Board of Directors (or similar body) of such corporation, partnership or
other entity are at the time owned, directly or indirectly through one or more
intermediaries, or both, by such Person. Unless the context otherwise requires,
each reference to a Subsidiary herein shall be a reference to a Subsidiary of a
Credit Party.

 

“Tax” means any present or future taxes, levies, imposts, duties, deductions,
withholdings (including backup withholding), assessments, fees or other charges
imposed by any Governmental Authority, including any interest, additions to tax
or penalties applicable thereto.

 

“Term Loan Amount” means an original principal amount equal to Two Hundred
Million Dollars ($200,000,000.00).

 

“Term Loan Commitment” means, with respect to any Lender, the commitment of such
Lender to make the Credit Extensions relating to the Term Loans on the Closing
Date, in the aggregate principal amount set forth opposite such Lender’s name on
Exhibit E attached hereto.

 

“Term Loan Maturity Date” means the 48th-month anniversary of the Closing Date.

 

“Term Loan Note” means a promissory note in substantially the form attached
hereto as Exhibit B, as it may be amended, restated, supplemented or otherwise
modified from time to time.

 

“Term Loan Rate” is defined in Section 2.3(a)(i).

 

“Term Loans” is defined in Section 2.2(a).

 

“Territory” means, collectively, the United States and all other countries in
which any Product has been commercialized by the Credit Parties or their
Subsidiaries, or in which any attempt to commercialize any Product by the Credit
Parties or their Subsidiaries has occurred (such as submission of applications
to Governmental Authorities).

 

“Third Party IP” is defined in Section 4.6(m).

 

“Trademarks” means (a)(i) all trademarks, trade names, corporate names, company
names, business names, fictitious business names, service marks, elements of
package or trade dress of goods or services, logos and other source or business
identifiers, (ii) all registrations and recordings thereof in the United States
Patent and Trademark Office or in any similar office or agency of the United
States or any state thereof or in any similar office or agency anywhere in the
world in which foreign counterparts are registered or issued, (iii) all
applications in connection therewith and (iv) all goodwill associated therewith,
and (b) all renewals thereof.

 

“Transfer” is defined in Section 6.1.

 

“Treasury Regulations” mean those regulations promulgated pursuant to the IRC.

 

“TRICARE” means a program of medical benefits covering former and active members
of the uniformed services and certain of their dependents, financed and
administered by the United States Departments of Defense, Health and Human
Services and Transportation.

 

“UKBA” is defined in Section 4.18(a).

 

“United States” or “U.S.” means the United States of America, its fifty (50)
states, the District of Columbia, Puerto Rico or any other jurisdiction within
the United States of America.

 

“U.S. Person” means any Person that is a “United States person” as defined in
Section 7701(a)(30) of the Code.

 

82

 

 

“Wholly-Owned Subsidiary” means, with respect to any Person, a Subsidiary of
such Person, all of the Equity Interests in which (other than directors’
qualifying shares or nominee or other similar shares required pursuant to
Requirements of Law) are owned by such Person or another Wholly-Owned Subsidiary
of such Person. Unless the context otherwise requires, each reference to a
Wholly-Owned Subsidiary herein shall be a reference to a Wholly-Owned Subsidiary
of a Credit Party.

 

“Withdrawal Liability” means liability to a Multiemployer Plan as a result of a
complete or partial withdrawal from such Multiemployer Plan, as such terms are
defined in Part I of Subtitle E of Title IV of ERISA.

 

[Signature page follows.]

 

83

 

 

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
as of the Effective Date.

 

COLLEGIUM PHARMACEUTICAL INC.,  

as Borrower

      By: /s/ Joseph Ciaffoni   Name: Joseph Ciaffoni   Title: President and
Chief Executive Officer  

 

Signature Page to Loan Agreement

 

 

 

 

COLLEGIUM SECURITIES CORPORATION,  

as an additional Credit Party

      By: /s/ Joseph Ciaffoni   Name: Joseph Ciaffoni   Title: President  

 

Signature Page to Loan Agreement

 

 

 

 

BIOPHARMA CREDIT PLC,   as Collateral Agent and Lender   By: Pharmakon Advisors,
LP,     its Investment Manager           By: Pharmakon Management I, LLC,      
its General Partner                   By /s/ Pedro Gonzalez de Cosio   Name:  
Pedro Gonzalez de Cosio   Title:     CEO and Managing Member  

 

BIOPHARMA CREDIT INVESTMENTS V (MASTER) LP,   as Lender       By: Pharmakon
Advisors, LP,     its Investment Manager           By: Pharmakon Management I,
LLC,       its General Partner                   By /s/ Pedro Gonzalez de Cosio
  Name:   Pedro Gonzalez de Cosio   Title:     CEO and Managing Member  

 

Signature Page to Loan Agreement

 

 

 

 

EXHIBIT A – PAYMENT/ADVANCE REQUEST FORM

 

LOAN PAYMENT/ADVANCE REQUEST

 

Reference is made to that certain Loan Agreement dated as of February 6, 2020 by
and among COLLEGIUM PHARMACEUTICAL INC., a Virginia corporation (“Borrower”),
BIOPHARMA CREDIT PLC (in its capacity as “Collateral Agent” and a “Lender”) and
BIOPHARMA CREDIT INVESTMENTS V (MASTER) LP (a “Lender”) and the other parties
thereto (the “Loan Agreement”; with other capitalized terms used below having
the meanings ascribed thereto in the Loan Agreement). This Loan Payment/Advance
Request is being delivered pursuant to Section 3.4 of the Loan Agreement.

 

The undersigned, being the duly elected and acting Executive Vice President and
Chief Financial Officer of Borrower does hereby certify, solely in his/her
capacity as an authorized officer of Borrower and not in his/her personal
capacity, that, on the Closing Date:

 

1.        Borrower hereby requests a borrowing of the Term Loans;

 

2.        each of the representations and warranties made by the Credit Parties
(i) in Section 4.1(a) (as to each Credit Party only), Section 4.1(b)(ii),
Section 4.3(a), Section 4.3(b)(i) Section 4.5, Section 4.9, Section 4.13(a),
Section 4.14, and Section 4.18(d), and (ii) subject to the Funds Certain
Provisions and solely to the extent that a breach thereof is (or would be)
materially adverse to the interests of the Collateral Agent or Lenders with
respect to any lien on any of the assets or properties described therein
(including the creation or perfection of any security interest therein), Section
4.6(s), is true and correct in all material respects on the Closing Date (both
with and without giving effect to the Term Loans and the consummation of the
transactions contemplated by the Acquisition Agreement), unless such
representation or warranty is expressly stated to relate to a specific earlier
date, in which case such representation or warranty shall be true and correct in
all material respects as of such earlier date (it being understood that any such
representation or warranty that is qualified as to “materiality,” “Material
Adverse Change,” or similar language shall be true and correct in all respects
on the Closing Date (both with and without giving effect to the Term Loans and
the consummation of the transactions contemplated by the Acquisition Agreement)
or as of such earlier date, as applicable);

 

3.        all conditions set forth in Section 3.1 and Section 3.2 of the Loan
Agreement have been satisfied (or waived by the Required Lenders) as of the
Closing Date (excluding, for the avoidance of doubt, the satisfaction of the
Collateral Agent or any Lender with respect to any document or action specified
in any such condition precedent as being subject to the satisfaction of the
Collateral Agent or any Lender);

 

4.        the undersigned is a Responsible Officer of Borrower; and

 

5.        the proceeds of the Term Loans shall be disbursed as set forth on
Attachment A hereto.1

 

Dated: ___________________, 20__

 

[Signature page follows]

 

 

1 To be prepared by the Collateral Agent’s counsel for attachment hereto.

 

 

 

 

COLLEGIUM PHARMACEUTICAL INC.,   as Borrower       By:
                              Name:                                 Title:   
                             

 

Signature Page to Loan/Advance Request

 

 

 

 

EXHIBIT B

 

THIS NOTE CONTAINS ORIGINAL ISSUE DISCOUNT, AS DEFINED IN SECTION 1273 OF THE
INTERNAL REVENUE CODE OF 1986, AS AMENDED. PLEASE CONTACT PAUL BRANNELLY, 100
TECHNOLOGY CENTER DRIVE, SUITE 300, STOUGHTON, MA 02072, TELEPHONE: (781)
713-3699 TO OBTAIN INFORMATION REGARDING THE ISSUE PRICE OF THE NOTE, THE AMOUNT
OF ORIGINAL ISSUE DISCOUNT IN THE NOTE AND THE YIELD TO MATURITY.

 

TERM LOAN NOTE

 

$______________.00 Dated: [________], 2020

 

FOR VALUE RECEIVED, the undersigned, COLLEGIUM PHARMACEUTICAL, INC., a Virginia
corporation (“Borrower”), HEREBY PROMISES TO PAY to [BIOPHARMA CREDIT PLC]
[BIOPHARMA CREDIT INVESTMENTS V (MASTER) LP] (“Lender”), or its registered
assignees, the principal amount of ______________ MILLION DOLLARS
($_________.00), plus interest on the aggregate unpaid principal amount hereof
at a per annum rate equal to the LIBOR Rate plus seven and one half percent
(7.50%) per annum, and in accordance with the terms of the Loan Agreement dated
as of February 6, 2020 by and among Borrower, Lender and the other parties
thereto (as may be amended, restated, supplemented or otherwise modified from
time to time, the “Loan Agreement”). If not sooner paid, the entire principal
amount and all accrued and unpaid interest hereunder, all due and unpaid Lender
Expenses and any other amounts payable under the Loan Documents, shall be due
and payable on the Term Loan Maturity Date. Any capitalized term not otherwise
defined herein shall have the meaning attributed to such term in the Loan
Agreement.

 

Borrower shall make equal quarterly payments of principal of the Term Loans
commencing on the first Payment Date on the 3rd-month anniversary of the Closing
Date and continuing on each subsequent Payment Date; provided, that if any such
Payment Date is not a Business Day, the applicable payment shall be due and
payable on the first Business Day immediately after such date. All unpaid
principal with respect to the Term Loans (and, for the avoidance of doubt, all
accrued and unpaid interest, all due and unpaid Lender Expenses and any other
amounts payable under the Loan Documents) is due and payable in full on the Term
Loan Maturity Date. Interest shall accrue on this Term Loan Note commencing on,
and including, the date of this Term Loan Note, and shall accrue on this Term
Loan Note, or any portion thereof, for the day on which this Term Loan Note or
such portion is paid. Interest on this Term Loan Note shall be payable in
accordance with Section 2.3 of the Loan Agreement.

 

Principal, interest and all other amounts due with respect to this Term Loan
Note are payable in lawful money of the United States of America to Lender as
set forth in the Loan Agreement and this Term Loan Note.

 

The Loan Agreement, among other things, (a) provides for the making of secured
Term Loans by Lender to Borrower, and (b) contains provisions for acceleration
of the maturity hereof upon the happening of certain stated events.

 

This Term Loan Note may not be prepaid except as set forth in Section 2.2(c) of
the Loan Agreement or as expressly provided in Section 8.1 of the Loan
Agreement.

 

This Term Loan Note and the obligation of Borrower to repay the unpaid principal
amount of this Term Loan Note, interest thereon, and all other amounts due
Lender under the Loan Agreement are secured pursuant to the Collateral
Documents.

 

Presentment for payment, demand, notice of protest and all other demands and
notices of any kind in connection with the execution, delivery, performance and
enforcement of this Term Loan Note are hereby waived.

 

thIS TERM LOAN NOTE AND ANY CLAIMS, CONTROVERSY, DISPUTE OR CAUSE OF ACTION
(WHETHER IN CONTRACT OR TORT OR OTHERWISE) BASED UPON, ARISING OUT OF OR
RELATING TO THIS TERM LOAN NOTE SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.

 

 

 

 

Note Register; Ownership of Note. The ownership of an interest in this Term Loan
Note shall be registered on a record of ownership maintained by Collateral
Agent. Notwithstanding anything else in this Term Loan Note to the contrary, the
right to the principal of, and stated interest on, this Term Loan Note may be
transferred only if the transfer is registered on such record of ownership and
the transferee is identified as the owner of an interest in the obligation.
Borrower shall be entitled to treat the registered holder of this Term Loan Note
(as recorded on such record of ownership) as the owner in fact thereof for all
purposes and shall not be bound to recognize any equitable or other claim to or
interest in this Term Loan Note on the part of any other Person.

 

[Signature page follows]

 

 

 

 

 

IN WITNESS WHEREOF, Borrower has caused this Term Loan Note to be duly executed
by one of its officers thereunto duly authorized on the date hereof.

 

BORROWER:   COLLEGIUM PHARMACEUTICAL, INC., as Borrower   By:
                                     Name: Joseph Ciaffoni     Title: President
and Chief Executive Officer

 

Signature Page to Term Loan Note

 

 

 

 

EXHIBIT C

 

FORM OF SECURITY AGREEMENT

 

(to be attached)

 

 

 

 

EXHIBIT D

 

COMPLIANCE CERTIFICATE

 

  TO: BIOPHARMA CREDIT PLC     FROM: COLLEGIUM PHARMACEUTICAL, INC.

 

The undersigned authorized officer of COLLEGIUM PHARMACEUTICAL, INC., a Virginia
corporation (“Borrower”) hereby certifies, solely in his/her capacity as a
Responsible Officer of Borrower and not in his/her personal capacity, that in
accordance with the terms and conditions of the Loan Agreement (the “Loan
Agreement”; capitalized terms used, but not defined herein having the meanings
given them in the Loan Agreement) dated as of February 6, 2020 by and among
Borrower, the Guarantors from time to time party thereto, BIOPHARMA CREDIT PLC,
a public limited company incorporated under the laws of England and Wales (as
“Collateral Agent”) and the Lenders party thereto:

 

(i)       The Credit Parties are in compliance for the period ending
_______________ with the covenants set forth in Section 5.2 and Section 6.15 of
the Loan Agreement, except as noted below;

 

(ii)       No Default or Event of Default has occurred and is continuing, except
as noted below;

 

(iii)       Each Credit Party and each of its Subsidiaries has timely filed all
foreign, U.S. federal and state income Tax returns and other material Tax
returns and reports (or extensions thereof) of each Credit Party and each of its
Subsidiaries required to be filed by any of them and such returns and reports
are correct in all material respects, and has timely paid all material Taxes,
assessments, deposits and contributions owed which are due and payable by any
Credit Party or Subsidiary or upon its properties, assets, income, businesses
and franchises, except as otherwise permitted pursuant to the terms of Section
4.10 or Section 5.3 of the Loan Agreement; and

 

(iv)       No Liens have been levied or claims made against any Credit Party or
any of its Subsidiaries relating to unpaid employee payroll or benefits of which
(a) such Credit Party has not previously provided written notification to the
Collateral Agent or (b) which do not constitute Permitted Liens.

 

Attached are the required documents, if any, supporting our certification(s).
The undersigned Responsible Officer of Borrower further certifies, in such
capacity and not in his/her personal capacity, that the attached financial
statements (if any) fairly present, in all material respects, the consolidated
financial condition, results of operations and cash flows of Borrower and its
Subsidiaries as of applicable the dates and for the applicable periods in
accordance with Applicable Accounting Standards consistently applied (taking
into account the provisions of Section 1 of the Loan Agreement if and to the
extent applicable).

 

Date: ______________________

 

[Signature page follows]

 

 

 

  

COLLEGIUM PHARMACEUTICAL, INC., as Borrower   By:
                                              Name:           Title:    

 

 

 

 

Please indicate compliance status since the last Compliance Certificate by
circling Yes, No, or N/A under “Complies” column.

 

  Reporting Covenant Requirement   Complies 1) Annual Financial Statements 90
days after year end   Yes No N/A 2) Quarterly Financial Statements 45 days after
quarter end   Yes No N/A 3) Other Information after an Event of Default 5
Business Days after request   Yes No N/A 4) Legal Action Notice Promptly   Yes
No N/A 5) Notice of Default, etc. Promptly (within 5 Business Days) after
knowledge   Yes No N/A 6) Minimum Revenue Quarterly   Yes No N/A

 

Deposit and Securities Accounts (Please list all accounts and indicate each
Excluded Account with an
asterisk (*); attach separate sheet if additional space needed)

 

  Bank   Account Number   New Account?   Acct Control Agmt in place? 1)        
Yes No   Yes No 2)         Yes No   Yes No 3)         Yes No   Yes No 4)        
Yes No   Yes No 5)         Yes No   Yes No 6)         Yes No   Yes No          
            Other Matters                   Have there been any changes in
management since the last Compliance Certificate?     Yes   No                  
  Have there been any prohibited Transfers?     Yes   No     Exceptions        
          Please explain any exceptions with respect to the certification
above:  (If no exceptions exist, state “No exceptions.” Attach separate sheet if
additional space needed.)                                                      
                                         

 

 

 

                              LENDER USE ONLY                                  
  Compliance Status Yes No

 

 

 

 

EXHIBIT E

 

COMMITMENTS; NOTICE ADDRESSES

 

Lender Commitments

Notice Address

 

BioPharma Credit PLC Term Loan Commitment:
$165,000,000.00

BIOPHARMA CREDIT PLC
c/o Beaufort House
51 New North Road
Exeter EX4 4EP
United Kingdom
Attn: Company Secretary
Tel: +44 01 392 477 500
Fax: +44 01 392 253 282

 

   

with copies (which shall not constitute notice) to:

 

PHARMAKON ADVISORS LP
110 East 59th Street, #3300
New York, NY 10022
Attn: Pedro Gonzalez de Cosio
Phone: +1 (212) 883-2296
Fax: +1 (917) 210-4048
Email: pg@PharmakonAdvisors.com

 

   

and

 

AKIN GUMP STRAUSS HAUER & FELD LLP
One Bryant Park
New York, NY 10036-6745
Attn: Geoffrey E. Secol
Phone: (212) 872-8081
Fax: (212) 872-1002
Email: gsecol@akingump.com

 

BioPharma Credit Investments V (Master) LP

Term Loan Commitment:
$35,000,000.00

 

 

BIOPHARMA CREDIT INVESTMENTS V (MASTER) LP

c/o BioPharma Credit Investments V GP LLC

c/o Walkers Corporate Limited

Cayman Corporate Centre, 27 Hospital Road,

George Town, Grand Cayman KY1-9008

Attn:  Pedro Gonzalez de Cosio

 

   

with copies (which shall not constitute notice) to:

 

PHARMAKON ADVISORS LP

110 East 59th Street, #3300

New York, NY 10022

Attn: Pedro Gonzalez de Cosio

Phone: +1 (212) 883-2296

Fax: +1 (917) 210-4048

Email: pg@PharmakonAdvisors.com

 

   

and

 

AKIN GUMP STRAUSS HAUER & FELD LLP

One Bryant Park

New York, NY 10036-6745

Attn: Geoffrey E. Secol

Phone: (212) 872-8081

Fax: (212) 872-1002

Email: gsecol@akingump.com