Exhibit 10.1

EXECUTION VERSION

THIRD AMENDED AND RESTATED CREDIT AND GUARANTY AGREEMENT

dated as of February 13, 2012

among

VALEANT PHARMACEUTICALS INTERNATIONAL, INC.,

as Borrower,

CERTAIN SUBSIDIARIES OF VALEANT PHARMACEUTICALS INTERNATIONAL, INC.,

as Guarantors,

VARIOUS LENDERS FROM TIME TO TIME PARTY HERETO,

GOLDMAN SACHS LENDING PARTNERS LLC, J.P. MORGAN SECURITIES LLC and

MORGAN STANLEY SENIOR FUNDING, INC.,

as Joint Lead Arrangers and Joint Bookrunners,

JPMORGAN CHASE BANK, N.A., and MORGAN STANLEY SENIOR FUNDING, INC.

as Co-Syndication Agents

JPMORGAN CHASE BANK, N.A.,

as Issuing Bank

GOLDMAN SACHS LENDING PARTNERS LLC,

as Administrative Agent and Collateral Agent,

RBC CAPITAL MARKETS and

DNB BANK ASA,

as Co-Documentation Agents,

and

THE BANK OF NOVA SCOTIA and

SUNTRUST BANK,

as Senior Managing Agents

 

 

$3,100,000,000 Senior Secured Credit Facilities

 

 

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TABLE OF CONTENTS

 

         Page  

SECTION 1.

 

DEFINITIONS AND INTERPRETATION

  

1.1

 

Definitions

     2   

1.2

 

Accounting Terms

     40   

1.3

 

Interpretation, etc.

     40   

1.4

 

Currency Matters

     41   

1.5

 

Pro Forma Transactions

     41   

1.6

 

Effect of This Agreement on the Second Amended and Restated Credit Agreement and
Other Credit Documents

     41   

SECTION 2.

 

LOANS AND LETTERS OF CREDIT

  

2.1

 

Term Loans

     42   

2.2

 

Revolving Loans

     42   

2.3

 

Swing Line Loans

     43   

2.4

 

Issuance of Letters of Credit and Purchase of Participations Therein

     45   

2.5

 

Pro Rata Shares; Availability of Funds

     49   

2.6

 

Use of Proceeds

     49   

2.7

 

Evidence of Debt; Register; Lenders’ Books and Records; Notes

     50   

2.8

 

Interest on Loans

     51   

2.9

 

Conversion/Continuation

     53   

2.10

 

Default Interest

     53   

2.11

 

Fees

     53   

2.12

 

Scheduled Payments/Commitment Reductions

     54   

2.13

 

Voluntary Prepayments/Commitment Reductions

     55   

2.14

 

Mandatory Prepayments

     57   

2.15

 

Application of Prepayments

     58   

2.16

 

General Provisions Regarding Payments

     59   

2.17

 

Ratable Sharing

     60   

2.18

 

Making or Maintaining Eurodollar Rate Loans

     61   

2.19

 

Increased Costs; Capital Adequacy

     63   

2.20

 

Taxes; Withholding, etc.

     64   

2.21

 

Obligation to Mitigate

     66   

2.22

 

Defaulting Lenders

     66   

2.23

 

Removal or Replacement of a Lender

     67   

2.24

 

Interest Act (Canada)

     68   

2.25

 

Incremental Facilities

     68   

SECTION 3.

 

CONDITIONS PRECEDENT

  

3.1

 

Third Restatement Date

     71   

3.2

 

Prior Credit Dates

     73   

3.3

 

Conditions to Each Credit Extension

     73   

SECTION 4.

 

REPRESENTATIONS AND WARRANTIES

  

4.1

 

Organization; Requisite Power and Authority; Qualification

     74   

4.2

 

Equity Interests and Ownership

     74   

4.3

 

Due Authorization

     75   

 

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         Page  

4.4

 

No Conflict

     75   

4.5

 

Governmental Consents

     75   

4.6

 

Binding Obligation

     75   

4.7

 

Historical Financial Statements

     75   

4.8

 

Projections

     76   

4.9

 

No Material Adverse Change

     76   

4.10

 

Adverse Proceedings, etc.

     76   

4.11

 

Payment of Taxes

     76   

4.12

 

Properties

     76   

4.13

 

Environmental Matters

     77   

4.14

 

No Defaults

     78   

4.15

 

Governmental Regulation

     78   

4.16

 

Federal Reserve Regulations

     78   

4.17

 

Employee Matters

     78   

4.18

 

Employee Benefit Plans

     78   

4.19

 

Canadian Employee Benefit Plans

     79   

4.20

 

Solvency

     79   

4.21

 

Compliance with Statutes, etc.

     80   

4.22

 

Disclosure

     80   

4.23

 

PATRIOT Act and PCTFA

     80   

4.24

 

Creation, Perfection, etc.

     80   

4.25

 

OFAC Matters

     80   

SECTION 5.

 

AFFIRMATIVE COVENANTS

  

5.1

 

Financial Statements and Other Reports

     81   

5.2

 

Existence

     84   

5.3

 

Payment of Taxes and Claims

     85   

5.4

 

Maintenance of Properties

     85   

5.5

 

Insurance

     85   

5.6

 

Books and Records; Inspections

     85   

5.7

 

Lenders Meetings

     86   

5.8

 

Compliance with Laws

     86   

5.9

 

Environmental

     86   

5.10

 

Subsidiaries

     87   

5.11

 

Additional Material Real Estate Assets

     89   

5.12

 

Interest Rate Protection

     89   

5.13

 

Further Assurances

     89   

5.14

 

Maintenance of Ratings

     89   

5.15

 

Post-Closing Matters

     89   

5.16

 

Canadian Employee Benefit Plans

     90   

SECTION 6.

 

NEGATIVE COVENANTS

  

6.1

 

Indebtedness

     90   

6.2

 

Liens

     93   

6.3

 

No Further Negative Pledges

     96   

6.4

 

Restricted Junior Payments

     96   

6.5

 

Restrictions on Subsidiary Distributions

     97   

6.6

 

Investments

     98   

6.7

 

Financial Covenants

     99   

 

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         Page  

6.8

 

Fundamental Changes; Disposition of Assets; Acquisitions

     99   

6.9

 

Disposal of Subsidiary Interests

     102   

6.10

 

Sales and Leasebacks

     102   

6.11

 

Transactions with Shareholders and Affiliates

     102   

6.12

 

Conduct of Business

     102   

6.13

 

Amendments or Waivers with Respect to Subordinated Indebtedness

     102   

6.14

 

Amendments or Waivers of Organizational Documents

     103   

6.15

 

Fiscal Year

     103   

6.16

 

Specified Subsidiary Dispositions

     103   

6.17

 

Biovail Insurance

     103   

6.18

 

Establishment of Defined Benefit Plan

     103   

SECTION 7.

 

GUARANTY

  

7.1

 

Guaranty of the Obligations

     103   

7.2

 

Contribution by Guarantors

     103   

7.3

 

Payment by Guarantors

     103   

7.4

 

Liability of Guarantors Absolute

     104   

7.5

 

Waivers by Guarantors

     106   

7.6

 

Guarantors’ Rights of Subrogation, Contribution, etc.

     106   

7.7

 

Subordination of Other Obligations

     107   

7.8

 

Continuing Guaranty

     107   

7.9

 

Authority of Guarantors or Borrower

     107   

7.10

 

Financial Condition of Borrower

     107   

7.11

 

Bankruptcy, etc.

     108   

7.12

 

Discharge of Guaranty upon Sale of Guarantor

     108   

7.13

 

Swiss Guarantee Limitations

     108   

SECTION 8.

 

EVENTS OF DEFAULT

  

8.1

 

Events of Default

     110   

SECTION 9.

 

AGENTS

  

9.1

 

Appointment of Agents

     113   

9.2

 

Powers and Duties

     113   

9.3

 

General Immunity

     114   

9.4

 

Agents Entitled to Act as Lender

     115   

9.5

 

Lenders’ Representations, Warranties and Acknowledgment

     115   

9.6

 

Right to Indemnity

     115   

9.7

 

Successor Administrative Agent, Collateral Agent and Swing Line Lender

     116   

9.8

 

Collateral Documents and Guaranty

     118   

9.9

 

Withholding Taxes

     119   

9.10

 

Quebec Security

     119   

SECTION 10.

 

MISCELLANEOUS

  

10.1

 

Notices

     120   

10.2

 

Expenses

     121   

10.3

 

Indemnity

     122   

10.4

 

Set-Off

     123   

10.5

 

Amendments and Waivers

     123   

10.6

 

Successors and Assigns; Participations

     126   

 

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         Page  

10.7

 

Independence of Covenants

     129   

10.8

 

Survival of Representations, Warranties and Agreements

     129   

10.9

 

No Waiver; Remedies Cumulative

     129   

10.10

 

Marshalling; Payments Set Aside

     130   

10.11

 

Severability

     130   

10.12

 

Obligations Several; Independent Nature of Lenders’ Rights

     130   

10.13

 

Headings

     130   

10.14

 

APPLICABLE LAW

     130   

10.15

 

CONSENT TO JURISDICTION

     130   

10.16

 

WAIVER OF JURY TRIAL

     131   

10.17

 

Confidentiality

     131   

10.18

 

Usury Savings Clause

     132   

10.19

 

Counterparts

     133   

10.20

 

Effectiveness; Entire Agreement

     133   

10.21

 

PATRIOT Act; PCTFA

     133   

10.22

 

Electronic Execution of Assignments

     133   

10.23

 

No Fiduciary Duty

     133   

10.24

 

Judgment Currency

     134   

10.25

 

Joint and Several Liability

     134   

10.26

 

Advice of Counsel; No Strict Construction

     134   

10.27

 

Day Not a Business Day

     134   

10.28

 

Limitations Act, 2002

     135   

 

-iv-

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APPENDICES:    A-1    Revolving Commitments    A-2    Tranche B Term Loan
Commitments    B    Notice Addresses SCHEDULES:    1.1(b)    Third Restatement
Date Guarantors    2.11(c)    Closing Fee    3.1(e)(i)    Mortgaged Properties
   4.1    Jurisdictions of Organization and Qualification    4.2    Equity
Interests and Ownership    4.12    Real Estate Assets    4.18    Certain Defined
Benefit Plans    5.10(a)    Barbados Security Documents    5.10(b)    Quebec
Security Documents    5.10(c)    Luxembourg Security Documents    5.10(d)   
Swiss Security Documents    5.15    Post-Closing Matters    6.1    Certain
Indebtedness    6.2    Certain Liens    6.3    Certain Negative Pledges    6.5
   Certain Restrictions on Subsidiary Distributions    6.6    Certain
Investments    6.11    Certain Affiliate Transactions EXHIBITS:    A-1   
Funding Notice    A-2    Conversion/Continuation Notice    B-1    Revolving Loan
Note    B-2    Swing Line Note    B-3    Tranche A Term Loan Note    B-4   
Tranche B Term Loan Note    C    Compliance Certificate    D    Assignment
Agreement    E    [Reserved]    F-1    Third Restatement Date Certificate    F-2
   Solvency Certificate    G    Counterpart Agreement    H-1    Canadian
Guarantee    H-2    Barbados Guarantee    I-1    Second Amended and Restated
Pledge and Security Agreement    I-2    Canadian Pledge and Security Agreement
   J-1    Intercompany Note    J-2    Subordination Agreement    K    Joinder
Agreement    L    Contribution Agreement    M    Collateral Questionnaire

 

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THIRD AMENDED AND RESTATED CREDIT AND GUARANTY AGREEMENT

This THIRD AMENDED AND RESTATED CREDIT AND GUARANTY AGREEMENT, dated as of
February 13, 2012, is entered into by and among VALEANT PHARMACEUTICALS
INTERNATIONAL, INC., a corporation continued under the federal laws of Canada
(“Borrower”), CERTAIN SUBSIDIARIES OF BORROWER, as Guarantors, the Lenders party
hereto from time to time, GOLDMAN SACHS LENDING PARTNERS LLC (“GSLP”), J.P.
MORGAN SECURITIES LLC (“J.P. Morgan”) and MORGAN STANLEY SENIOR FUNDING, INC.
(“Morgan Stanley”), as Joint Lead Arrangers and Joint Bookrunners, JPMORGAN
CHASE BANK, N.A. and Morgan Stanley as Co-Syndication Agents (in such capacity,
the “Co-Syndication Agents”), JPMorgan Chase Bank, N.A., as Issuing Bank, GSLP,
as Administrative Agent (together with its permitted successors in such
capacity, “Administrative Agent”) and as Collateral Agent (together with its
permitted successors in such capacity, “Collateral Agent”), and RBC CAPITAL
MARKETS and DNB BANK ASA, as Co-Documentation Agents (in such capacity,
Co-Documentation Agents”).

RECITALS:

WHEREAS, capitalized terms used in these Recitals and not defined shall have the
respective meanings set forth for such terms in Section 1.1 hereof.

WHEREAS, Valeant Pharmaceuticals International, a Delaware corporation (“VPI”),
Borrower, the guarantors party thereto, the lenders party thereto, and GSLP, as
administrative agent and collateral agent for the lenders party thereto,
originally entered into the Credit and Guaranty Agreement dated as of June 29,
2011 (the “Original Credit Agreement”), subsequently entered into the Amended
and Restated Credit and Guaranty Agreement dated as of August 10, 2011, as
further amended by Amendment No. 1 dated as of August 12, 2011, as further
amended by Amendment No. 2 dated as of September 7, 2011 (collectively, the
“First Amended and Restated Credit Agreement”), and subsequently entered into
the Second Amended and Restated Credit and Guaranty Agreement, dated as of
October 20, 2011, as amended by the Joinder Agreement, dated as of December 19,
2011 (collectively, the “Second Amended and Restated Credit Agreement”).

WHEREAS, on the Second Restatement Date, the Lenders extended certain credit
facilities to Borrower, in an aggregate principal amount not to exceed
$2,000,000,000, consisting of (a) up to $275,000,000 aggregate principal amount
of Revolving Commitments, the proceeds of which were or will be used (i) to
finance a portion of the Acquisitions and pay related fees and expenses,
(ii) for permitted capital expenditures and permitted acquisitions, (iii) to
provide for the ongoing working capital requirements of Borrower and its
Subsidiaries, (iv) for general corporate purposes of Borrower and its
Subsidiaries and (v) to fund original issue discount and closing fees with
respect to the Loans made on the Second Restatement Date, (b) an aggregate
principal amount of $1,225,000,000 of Initial Draw Tranche A Term Loans, the
proceeds of which were or will be used (i) on the Second Restatement Date to
fund the repayment of a loan from VPI to Borrower followed by a use of the
repayment proceeds by VPI to fund the repayment in full of all loans outstanding
under the First Amended and Restated Credit Agreement and the payment of all
fees and expenses related thereto (the “Refinancing”) and (ii) for general
corporate purposes of Borrower and its Subsidiaries and (c) an aggregate
principal amount of $500,000,000 of Delayed Draw Term Loans, the proceeds of
which were or will be used (i) to finance a portion of the Acquisitions and pay
related fees and expenses and (ii) for general corporate purposes of Borrower
and its Subsidiaries. On the Second Amendment and Restatement Joinder Date, the
Lenders extended an additional aggregate principal amount of $500,000,000 of
Series A New Term Loans, the proceeds of which were or will be used for general
corporate purposes of Borrower and its Subsidiaries, including acquisitions.

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WHEREAS, the Lenders have agreed to extend an aggregate principal amount of
$600,000,000 of Tranche B Term Loan Commitments, the proceeds of which will be
used to (i) repay a portion of the Revolving Loans outstanding as of the Third
Restatement Date (but not to permanently reduce Revolving Commitments with
respect thereto) and (ii) for general corporate purposes of Borrower and its
Subsidiaries, including acquisitions.

WHEREAS, Borrower, the lenders party hereto and the other parties hereto desire
to amend and restate, without novation, the Second Amended and Restated Credit
Agreement on and subject to the terms and conditions set forth herein and in
Amendment No. 1 to Second Amended and Restated Credit and Guaranty Agreement,
dated as of the date hereof (the “Amendment Agreement”), among Borrower, the
lenders party thereto, the Administrative Agent, the Collateral Agent and the
other parties thereto.

NOW, THEREFORE, in consideration of the premises and the agreements, provisions
and covenants herein contained, the Second Amended and Restated Credit Agreement
is hereby amended and restated, without novation, to read in its entirety as
follows and, accordingly, the parties hereto agree as follows:

SECTION 1. DEFINITIONS AND INTERPRETATION

1.1 Definitions. The following terms used herein, including in the preamble,
recitals, exhibits, appendices and schedules hereto, shall have the following
meanings:

“2010 Merger” means the merger of VPI with and into Beach Merger Corp. pursuant
to the 2010 Merger Agreement.

“2010 Merger Agreement” means the Agreement and Plan of Merger, dated as of
June 20, 2010, among VPI, Borrower, Biovail Americas Corp. and Beach Merger
Corp., together with all exhibits, schedules, documents, agreements, and
instruments executed and delivered in connection therewith, as the same has been
amended, or modified in accordance with the terms and provisions thereof.

“2010 Transactions” means, collectively, (i) the redemption of VPI’s 8.375%
Senior Notes due 2016, issued under that certain indenture dated as of June 9,
2009, among VPI, the guarantors party thereto and The Bank of New York Mellon
Trust Company, Inc., as trustee, and VPI’s 7.625% Senior Notes due 2020, issued
under that certain indenture dated as of April 9, 2010, among VPI, the
guarantors party thereto and The Bank of New York Mellon Trust Company, Inc., as
trustee, (ii) the repayment in full and termination of that certain credit and
guaranty agreement, dated as of May 26, 2010, among VPI, the guarantors party
thereto, Goldman Sachs Lending Partners L.P., as sole lead arranger, and Goldman
Sachs Bank USA, as administrative agent and collateral agent, (iii) the
repayment in full and termination of that certain credit agreement, dated as of
June 9, 2009, among Borrower, the lenders party thereto and JPMorgan Chase Bank,
N.A., Toronto Branch, as Administrative Agent, (iv) the payment of the
Pre-Merger Special Dividend (as such term is defined in the 2010 Merger
Agreement) made on September 27, 2010, immediately prior to the consummation of
the 2010 Merger, pro rata to VPI’s shareholders on the record date of such for
such dividend, (v) the consummation of the 2010 Merger, (vi) the issuance of the
Senior Notes and (vii) the payment of all fees and expenses related thereto.

“Acquisitions” means, collectively, the Orthodermatologics Acquisition and the
Dermik Acquisition.

“Additional Credit Party” means any Credit Party, as of the Third Restatement
Date, that was not a Credit Party as of the Second Restatement Date.

 

-2-

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“Adjusted Eurodollar Rate” means, for any Interest Rate Determination Date with
respect to an Interest Period for a Eurodollar Rate Loan, the rate per annum
obtained by dividing (and rounding upward to the next whole multiple of 1/100 of
1%) (i) (a) the rate per annum (rounded to the nearest 1/100 of 1%) equal to the
rate determined by Administrative Agent to be the offered rate which appears on
the page of the Reuters Screen which displays an average British Bankers
Association Interest Settlement Rate (such page currently being LIBOR01 page)
for deposits (for delivery on the first day of such period) with a term
equivalent to such period in Dollars, determined as of approximately 11:00 a.m.
(London, England time) on such Interest Rate Determination Date, or (b) in the
event the rate referenced in the preceding clause (a) does not appear on such
page or service or if such page or service shall cease to be available, the rate
per annum (rounded to the nearest 1/100 of 1%) equal to the rate determined by
Administrative Agent to be the offered rate on any such other page or other
service which displays an average British Bankers Association Interest
Settlement Rate for deposits (for delivery on the first day of such period) with
a term equivalent to such period in Dollars, determined as of approximately
11:00 a.m. (London, England time) on such Interest Rate Determination Date, or
(c) in the event the rates referenced in the preceding clauses (a) and (b) are
not available, the rate per annum (rounded to the nearest 1/100 of 1%) equal to
the offered quotation rate to a major bank in the London interbank market by
JPMorgan Chase Bank, N.A. for deposits (for delivery on the first day of the
relevant period) in Dollars of amounts in same day funds comparable to the
principal amount of the applicable Loan, for which the Adjusted Eurodollar Rate
is then being determined with maturities comparable to such period as of
approximately 11:00 a.m. (London, England time) on such Interest Rate
Determination Date, by (ii) an amount equal to (a) one minus (b) the Applicable
Reserve Requirement; provided, however, that notwithstanding the foregoing, the
Adjusted Eurodollar Rate in respect of the Tranche B Term Loans shall at no time
be less than 1%.

“Administrative Agent” as defined in the preamble hereto.

“Adverse Proceeding” means any action, suit, claim, proceeding, hearing (in each
case, whether administrative, judicial or otherwise), governmental investigation
or arbitration (whether or not purportedly on behalf of Borrower or any of its
Subsidiaries) pursuant to any statute, regulation, ordinance, common law, equity
or any other legal principle or process, or before or by any Governmental
Authority, domestic or foreign (including any Environmental Claims), whether
pending or, to the knowledge of Borrower or any of its Subsidiaries, threatened
against or affecting Borrower or any of its Subsidiaries or any property of
Borrower or any of its Subsidiaries.

“Affected Lender” as defined in Section 2.18(b).

“Affected Loans” as defined in Section 2.18(b).

“Affiliate” means, as applied to any Person, any other Person directly or
indirectly controlling, controlled by, or under common control with, that
Person. For the purposes of this definition, “control” (including, with
correlative meanings, the terms “controlling,” “controlled by” and “under common
control with”), as applied to any Person, means the possession, directly or
indirectly, of the power (i) solely for purposes of Section 6.11, to vote 10% or
more of the Securities having ordinary voting power for the election of
directors of such Person or (ii) to direct or cause the direction of the
management and policies of that Person, whether through the ownership of voting
securities or by contract or otherwise.

“Agent” means each of (a) the Administrative Agent, (b) each Co-Syndication
Agent, (c) the Collateral Agent, (d) each Co-Documentation Agent, (e) each
Senior Managing Agent and (f) any other Person appointed under the Credit
Documents to serve in an agent or similar capacity.

“Agent Affiliates” as defined in Section 10.1(b)(3).

 

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“Aggregate Amounts Due” as defined in Section 2.17.

“Agreement” means this Third Amended and Restated Credit and Guaranty Agreement,
dated as of February 13, 2012, as it may be amended, restated, supplemented or
otherwise modified from time to time.

“Amendment Agreement” as defined in the recitals.

“Applicable Law” means any and all current and future applicable laws (including
common law and equity), statutes, by-laws, rules, regulations, orders,
ordinances, protocols, codes, treaties, policies, directions, directives,
decrees, restrictions, judgments, decisions, in each case, of, from or required
by any Governmental Authority and, in each case, whether having the force of law
or not.

“Applicable Margin” means (a) (i) with respect to Tranche B Term Loans that are
Eurodollar Rate Loans, 2.75% per annum and (ii) with respect to Tranche B Term
Loans that are Base Rate Loans, 1.75% per annum and (b) (i) until delivery of
financial statements of Borrower and a related Compliance Certificate for the
first full Fiscal Quarter commencing on or after the Second Restatement Date
pursuant to Section 5.1(c), (A) with respect to Revolving Loans and Tranche A
Term Loans that are Eurodollar Rate Loans, 2.75% per annum, (B) with respect to
Revolving Loans, Swing Line Loans and Tranche A Term Loans that are Base Rate
Loans, 1.75% per annum and (ii) thereafter, the percentages per annum set forth
in the table below, based upon the Leverage Ratio of Borrower, as of the last
day of the most recently ended Fiscal Quarter for which financial statements
were required to have been delivered pursuant to Section 5.1(a) or (b):

 

Pricing

Level

  

Leverage Ratio

   Eurodollar
Rate Loans     Base Rate
Loans  

I

   > 4.0 to 1.0      3.00 %      2.00 % 

II

   £ 4.0 to 1.0 but > 3.25 to 1.0      2.75 %      1.75 % 

III

   £ 3.25 to 1.0      2.50 %      1.50 % 

Any increase or decrease in the Applicable Margin resulting from a change in the
Leverage Ratio shall become effective as of the first Business Day immediately
following the date a Compliance Certificate is delivered pursuant to Section 5.1
(including, for the avoidance of doubt, the latest delivery under the Second
Amended and Restated Credit Agreement); provided that Pricing Level I shall
apply (x) as of the first Business Day after the date on which a Compliance
Certificate was required to have been delivered but was not delivered, and shall
continue to so apply to and including the date on which such Compliance
Certificate is so delivered (and thereafter the Pricing Level otherwise
determined in accordance with this definition shall apply) and (y) as of the
first Business Day after an Event of Default shall have occurred and be
continuing, and shall continue to so apply to but excluding the date on which
such Event of Default is cured or waived (and thereafter the Pricing Level
otherwise determined in accordance with this definition shall apply).

In the event that Administrative Agent and Borrower determine that any financial
statements previously delivered were incorrect or inaccurate (regardless of
whether this Agreement or the Commitments are in effect when such inaccuracy is
discovered), and such inaccuracy, if corrected, would have led to the
application of a higher Applicable Margin for any period (an “Applicable
Period”) than the Applicable Margin applied for such Applicable Period, then
(i) Borrower shall as soon as practicable deliver to Administrative Agent the
corrected financial statements for such Applicable Period, (ii) the Applicable
Margin shall be determined as if the Pricing Level for such higher Applicable
Margin were applicable for such Applicable Period and (iii) Borrower shall
within three (3) Business Days thereof by Administrative

 

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Agent pay to Administrative Agent the accrued additional amount owing as a
result of such increased Applicable Margin for such Applicable Period, which
payment shall be promptly applied by Administrative Agent in accordance with
this Agreement. This paragraph shall not limit the rights of Administrative
Agent and Lenders with respect to Section 2.8 and Section 8.

“Applicable Reserve Requirement” means, at any time, for any Eurodollar Rate
Loan, the maximum rate, expressed as a decimal, at which reserves (including,
any basic marginal, special, supplemental, emergency or other reserves) are
required to be maintained by member banks of the United States Federal Reserve
System (or any successor thereto) with respect thereto against “Eurocurrency
liabilities” (as such term is defined in Regulation D) under regulations issued
from time to time by the Board of Governors or other applicable banking
regulator. Without limiting the effect of the foregoing, the Applicable Reserve
Requirement shall reflect any other reserves required to be maintained by such
member banks with respect to (i) any category of liabilities which includes
deposits by reference to which the applicable Adjusted Eurodollar Rate is to be
determined, or (ii) any category of extensions of credit or other assets which
include Eurodollar Rate Loans. A Eurodollar Rate Loan shall be deemed to
constitute Eurocurrency liabilities and as such shall be deemed subject to
reserve requirements without benefits of credit for proration, exceptions or
offsets that may be available from time to time to the applicable Lender. The
rate of interest on Eurodollar Rate Loans shall be adjusted automatically on and
as of the effective date of any change in the Applicable Reserve Requirement.

“Approved Electronic Communications” means any notice, demand, communication,
information, document or other material that any Credit Party provides to an
Agent pursuant to any Credit Document or the transactions contemplated therein
which is distributed to the Agents or to the Lenders by means of electronic
communications pursuant to Section 10.1(b).

“Arrangers” J.P. Morgan, GSLP and Morgan Stanley, each in its capacity as a
joint lead arranger.

“Asset Sale” means a sale, lease or sub-lease (as lessor or sublessor), sale and
leaseback, assignment, conveyance, exclusive license (as licensor or
sublicensor), transfer or other disposition to, or any exchange of property
with, any Person (other than Borrower or any Guarantor Subsidiary), in one
transaction or a series of transactions, of all or any part of Borrower’s or any
of its Subsidiaries’ businesses, assets or properties of any kind, whether real,
personal, or mixed and whether tangible or intangible, whether now owned or
hereafter acquired, leased or licensed, including, the Equity Interests of any
of Borrower’s Subsidiaries, other than:

(1) inventory (or other assets, including, for greater certainty, Intellectual
Property) sold, leased or licensed out in the ordinary course of business
(excluding any such sales, leases or licenses out by operations or divisions
discontinued or to be discontinued);

(2) an issuance of Equity Interests by a Subsidiary of Borrower to Borrower or
to another Subsidiary (so long as such issuance would otherwise be permitted
under Section 6.6) or the issuance of directors’ qualifying shares or of other
nominal amounts of other Equity Interests that are required to be held by
specified Persons under Applicable Law;

(3) the sale or other disposition of cash or Cash Equivalents;

(4) a Restricted Junior Payment that is permitted by Section 6.4 or Investment
that is permitted by Section 6.6;

 

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(5) the license of Intellectual Property to third persons in the ordinary course
of business;

(6) the sale, exchange or other disposition of accounts receivable in connection
with the compromise, settlement or collection thereof consistent with past
practice;

(7) leases or subleases entered into in the ordinary course of business, to the
extent that they do not materially interfere with the business of Borrower or
any of its Subsidiaries;

(8) the sale or other disposition of Investments under clause (c)(i) and (k) of
Section 6.6;

(9) sales, leases, licenses or other dispositions of other assets for aggregate
consideration not to exceed $25,000,000 for all such sales, leases or licenses
in any Fiscal Year;

(10) sales, leases, licenses or other dispositions of assets to Borrower or any
of its respective Subsidiaries; provided that, if any such disposition involves
a Credit Party and a Subsidiary that is not a Credit Party, then such
disposition shall be made in compliance with Section 6.11; and

(11) the disposition of assets resulting in Cash proceeds satisfying the
definition of “Net Insurance/Condemnation Proceeds” and applied in accordance
with Section 2.14(b).

For purposes of clarity, “Asset Sale” shall not include the issuance of any
Equity Interests of Borrower (including the issuance by any other Person of any
warrant, right or option to purchase or other arrangements or rights to acquire
any Equity Interests of Borrower).

“Assignment Agreement” means an Assignment and Assumption Agreement
substantially in the form of Exhibit D, with such amendments or modifications as
may be approved by Administrative Agent.

“Assignment Effective Date” as defined in Section 10.6(b).

“Australian Collateral” means: (a) all Collateral Documents governed by the laws
of any state or territory of Australia, and (b) all other Liens in respect of
Collateral located in any state or territory of Australia (or taken to be
located in any state or territory of Australia for the purposes of any stamp
duty law).

“Authorized Officer” means, as applied to any Person, any individual holding the
position of chairman of the board (if an officer), chief executive officer,
president, vice president (or the equivalent thereof), chief financial officer
(or the equivalent thereof) or treasurer of such Person; provided that the
secretary or assistant secretary of such Person shall have delivered an
incumbency certificate to the Administrative Agent as to the authority of such
Authorized Officer.

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

“Barbados Credit Party” means each of Valeant Holdings (Barbados) SRL, Valeant
International (Barbados) SRL, Biovail Laboratories International (Barbados) SRL,
Hythe Property Incorporated and each other Credit Party that is organized under
the laws of Barbados.

 

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“Barbados Guarantee” means the Barbados Guarantee Agreement, dated as of the
Third Restatement Date, by each Barbados Credit Party substantially in the form
of Exhibit H-2, as it may be amended, restated, supplemented or otherwise
modified from time to time.

“Barbados Security Documents” means each of the documents set forth on Schedule
5.10(a), dated as of the Third Restatement Date, as each of such documents may
be amended, restated, supplemented or otherwise modified from time to time and
additional analogous agreements as may be entered into from time to time in
accordance with Section 5.10 and as required by the Collateral Documents.

“Base Rate” means, for any day, a rate per annum equal to the greater of (i) the
Prime Rate in effect on such day and (ii) the Federal Funds Effective Rate in
effect on such day plus 1/2 of 1%. Any change in the Base Rate due to a change
in the Prime Rate or the Federal Funds Effective Rate shall be effective on the
effective day of such change in the Prime Rate or the Federal Funds Effective
Rate, respectively; provided, however, that notwithstanding the foregoing, the
Base Rate in respect of Tranche B Term Loans shall at no time be less than
2% per annum. On any day that Base Rate Loans are outstanding, in no event shall
the Base Rate be less than the sum of (i) the Adjusted Eurodollar Rate (after
giving effect to the Adjusted Eurodollar Rate “floor” set forth in the
definition thereof in the case of Tranche B Term Loans) that would be payable on
such day for a Eurodollar Rate Loan with a one-month interest period plus
(ii) the difference between the Applicable Margin for Eurodollar Rate Loans and
the Applicable Margin for Base Rate Loans.

“Base Rate Loan” means a Loan bearing interest at a rate determined by reference
to the Base Rate.

“Beneficiary” means each Agent, Issuing Bank, Lender and Lender Counterparty.

“BIA” means the Bankruptcy and Insolvency Act (Canada).

“Biovail Insurance” means Biovail Insurance Incorporated, a company organized
under the laws of Barbados.

“Biovail Insurance Trust Indenture” means the trust indenture dated as of
June 25, 2003, entered into among Biovail Insurance, Zurich Insurance Company
and the other parties thereto.

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

“Borrower” as defined in the preamble hereto.

“Borrower Convertible Notes” means Borrower’s 5.375% Senior Convertible Notes
due 2014, issued under that certain indenture dated as of June 10, 2009, among
Borrower, The Bank of New York Mellon, as trustee, and BNY Trust Company of
Canada, as co-trustee.

“Business Day” means (i) any day excluding Saturday, Sunday and any day which is
a legal holiday under the laws of the State of New York or the Province of
Ontario or is a day on which banking institutions located in such state are
authorized or required by law or other governmental action to close and
(ii) with respect to all notices, determinations, fundings and payments in
connection with the Adjusted Eurodollar Rate or any Eurodollar Rate Loans, the
term “Business Day” means any day which is a Business Day described in
clause (i) and which is also a day for trading by and between banks in Dollar
deposits in the London interbank market.

 

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“Canadian Confirmation of Guarantee and Security” means the Confirmation of
Guarantee and Security to be executed as of the Third Restatement Date by each
Canadian Credit Party, as it may be amended, restated, supplemented or otherwise
modified form time to time.

“Canadian Credit Party” means Borrower and each other Credit Party that (i) is
organized under the laws of Canada or any province or territory thereof,
(ii) carries on business in Canada, or (iii) has any title or interest in or to
material property in Canada.

“Canadian Dollars” and the sign “CDN$” mean the lawful money of Canada.

“Canadian Employee Benefit Plans” means all plans, arrangements, agreements,
programs, policies, practices or undertakings, whether oral or written, formal
or informal, funded or unfunded, insured or uninsured, registered or
unregistered to which a Canadian Credit Party is a party or bound or in which
their employees participate or under which a Canadian Credit Party has, or will
have, any liability or contingent liability, or pursuant to which payments are
made, or benefits are provided to, or an entitlement to payment or benefits may
arise with respect to any of their employees or former employees, directors or
officers, individuals working on contract with a Canadian Credit Party or other
individuals providing services to a Canadian Credit Party of a kind normally
provided by employees (or any spouses, dependants, survivors or beneficiaries of
any such person), but does not include the Canada Pension Plan that is
maintained by the Government of Canada or any Employee Benefit Plan.

“Canadian Guarantee” means the Canadian Guarantee, dated as of June 29, 2011, by
each Canadian Credit Party satisfying clause (i) of the definition thereof
substantially in the form of Exhibit H-1, as it may be amended, restated,
supplemented or otherwise modified from time to time.

“Canadian Pension Plan” means all Canadian Employee Benefit Plans that are
required to be registered under Canadian provincial or federal pension benefits
standards legislation.

“Canadian Pension Plan Termination Event” means an event which would entitle a
Person (without the consent of a Canadian Credit Party) to wind up or terminate
a Canadian Pension Plan in full or in part, or the institution of any steps by
any Person to withdraw from, terminate participation in, wind up or order the
termination or wind-up of, in full or in part, any Canadian Pension Plan, or the
receipt by a Canadian Credit Party of correspondence from a Governmental
Authority relating to a potential or actual, partial or full, termination or
wind-up of any Canadian Pension Plan, or an event respecting any Canadian
Pension Plan which would result in the revocation of the registration of such
Canadian Pension Plan or which could otherwise reasonably be expected to
adversely affect the tax status of any such Canadian Pension Plan.

“Canadian Pledge and Security Agreement” means the Canadian Pledge and Security
Agreement, dated as of June 29, 2011, by each Canadian Credit Party (satisfying
clause (i) of the definition thereof) substantially in the form of Exhibit I-2,
as it may be amended, restated, supplemented or otherwise modified from time to
time.

“Capital Lease” means, as applied to any Person, any lease of any property
(whether real, personal or mixed) by that Person as lessee that, in conformity
with GAAP, is or should be accounted for as a capital lease on the balance sheet
of that Person.

“Cash” means money, currency or a credit balance in any demand or Deposit
Account.

“Cash Equivalents” means, as at any date of determination, any of the following:
(i) marketable securities (a) issued or directly and unconditionally guaranteed
as to interest and principal by the United

 

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States Government or the Government of Canada, or (b) issued by any agency of
the United States Government or the Government of Canada, the obligations of
which are backed by the full faith and credit of such government, in each case
maturing within one year after such date; (ii) marketable direct obligations
issued by any state of the United States of America or any province of Canada or
any political subdivision of any such state or province or any public
instrumentality thereof, in each case maturing within one year after such date
and having, at the time of the acquisition thereof, a rating of at least A-1
from S&P or at least P-1 from Moody’s; (iii) commercial paper maturing no more
than 270 days from the date of creation thereof and having, at the time of the
acquisition thereof, a rating of at least A-1 from S&P or at least P-1 from
Moody’s; (iv) certificates of deposit or bankers’ acceptances maturing within
180 days after such date and issued or accepted by any Lender or by (a) any
commercial bank organized under the laws of the United States of America or any
state thereof or the District of Columbia that (x) is at least “adequately
capitalized” (as defined in the regulations of its primary Federal banking
regulator) and (y) has Tier 1 capital (as defined in such regulations) of not
less than $500,000,000, or (b) any bank listed on Schedule I of the Bank Act
(Canada) that has Tier 1 capital (as defined in OSFI Guideline A-1 on Capital
Adequacy Requirements) of not less than CDN$500,000,000; (v) shares of any money
market mutual fund that (a) has substantially all of its assets invested
continuously in the types of investments referred to in clauses (i) and
(ii) above, (b) has net assets of not less than $5,000,000,000, and (c) has the
highest rating obtainable from either S&P or Moody’s; (vi) fully collateralized
repurchase agreements with a term of not more than 30 days for securities
described in clause (i) above and entered into with a financial institution
satisfying the criteria described in clause (iv) above; and (vii) other
short-term investments utilized by Foreign Subsidiaries in accordance with
normal investment practices for cash management in investments of the type
analogous to the foregoing.

“Cash Management Agreement” means any agreement or arrangement to provide
treasury, depository, overdraft, credit or debit card, purchase card, electronic
funds transfer (including automated clearing house fund transfer services) and
other cash management services.

“CBCA” means the Canada Business Corporations Act.

“CCAA” means the Companies’ Creditors Arrangement Act (Canada).

“Change of Control” means, at any time, (i) any Person or “group” (within the
meaning of Rules 13d-3 and 13d-5 under the Exchange Act or Part XX of the
Securities Act (Ontario)) (a) shall have acquired beneficial ownership of 35% or
more on a fully diluted basis of the voting and/or economic interest in the
Equity Interests of Borrower or (b) shall have obtained the power (whether or
not exercised) to elect a majority of the members of the board of directors (or
similar governing body) of Borrower; (ii) Borrower shall cease, directly or
indirectly, to beneficially own and control 100% on a fully diluted basis of the
economic and voting interest in the Equity Interests of VPI; or (iii) the
majority of the seats (other than vacant seats) on the board of directors (or
similar governing body) of Borrower shall cease to be occupied by Persons who
either (a) were members of the board of directors (or similar governing body) of
Borrower immediately following the Third Restatement Date or (b) were nominated
for election by the board of directors (or similar governing body) of Borrower,
a majority of whom were members of the board of directors (or similar governing
body) of Borrower immediately following the Third Restatement Date or whose
election or nomination for election was previously approved by a majority of
such members.

“Class” means (i) with respect to Lenders, each of the following classes of
Lenders: (a) Lenders having Tranche A Term Loan Exposure, (b) Lenders having
Tranche B Term Loan Exposure, (c) Lenders (including Swing Line Lender) having
Revolving Exposure and (d) Lenders having New Term Loan Exposure of each
applicable Series and (ii) with respect to Loans, each of the following classes
of Loans: (a) Tranche A Term Loans, (b) Tranche B Term Loans, (c) Revolving
Loans (including Swing Line Loans) and (d) each additional Series of New Term
Loans.

 

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“CNI Growth Amount” means, on any date of determination, (a) 50% of Cumulative
Consolidated Net Income minus (b) (1) the aggregate amount at the time of
determination of Restricted Junior Payments made since the Third Restatement
Date using the CNI Growth Amount pursuant to Section 6.4(h) and (2) Investments
made since the Third Restatement Date using the CNI Growth Amount pursuant to
Section 6.6(i).

“Co-Syndication Agents” as defined in the preamble hereto.

“Collateral” means, collectively, all of the real, personal and mixed property
(including Equity Interests) in which Liens are purported to be granted pursuant
to the Collateral Documents as security for the Obligations.

“Collateral Agent” as defined in the preamble hereto.

“Collateral Documents” means the Second Amended and Restated Pledge and Security
Agreement, the Canadian Pledge and Security Agreement, the Barbados Security
Documents, the U.S. Mortgages, the Canadian Mortgages, the Quebec Security
Documents, the Luxembourg Security Documents, the Swiss Security Documents, the
Intellectual Property Security Agreements and all other instruments, documents
and agreements delivered by or on behalf or at the request of any Credit Party
pursuant to this Agreement, the Original Credit Agreement, the First Amended and
Restated Credit Agreement, the Second Amended and Restated Credit Agreement or
any of the other Credit Documents in order to grant to, or perfect, preserve or
protect in favor of, Collateral Agent, for the benefit of Secured Parties, a
Lien on any real, personal or mixed property of that Credit Party as security
for the Obligations or to protect or preserve the interest of the Collateral
Agent or the Secured Parties therein.

“Collateral Questionnaire” means a certificate substantially in the form of
Exhibit M.

“Commitment” means any Revolving Commitment or Term Loan Commitment.

“Compliance Certificate” means a Compliance Certificate substantially in the
form of Exhibit C.

“Consolidated Adjusted EBITDA” means, for any period, an amount determined for
Borrower and its Subsidiaries on a consolidated basis equal to Consolidated Net
Income for such period, plus, (i) to the extent deducted in determining
Consolidated Net Income for such period, the sum, without duplication of amounts
for:

(a) Consolidated Interest Expense;

(b) provisions for taxes based on income;

(c) total depreciation expense;

(d) total amortization expense;

(e) fees and expenses incurred in connection with the Transactions or the 2010
Transactions;

 

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(f) non-cash non-recurring expenses or charges;

(g) (i) restructuring charges (which, for the avoidance of doubt, shall include
retention, severance, systems establishment costs, excess pension charges,
contract termination costs and costs to consolidate facilities and relocate
employees) not to exceed $100,000,000 in any twelve-month period (other than
such charges contemplated by the following clause (ii)) and (ii) restructuring
charges (which, for the avoidance of doubt, shall include retention, severance,
systems establishment costs, excess pension charges, contract termination costs
and costs to consolidate facilities and relocate employees and charges in
connection with the termination or settlement of employee stock options,
restricted stock units and performance stock units, in each case in existence as
of the Original Closing Date) in connection with the Sanitas Acquisition, the
Transactions or the 2010 Transactions;

(h) any extraordinary gain or loss and any expense or charge attributable to the
disposition of discontinued operations;

(i) fees and expenses in connection with any proposed or actual issuance of any
Indebtedness or Equity Interests, or any proposed or actual acquisitions,
investments, asset sales or divestitures permitted hereunder, in an aggregate
amount not to exceed $75,000,000 during the term of this Agreement;

(j) other non-Cash charges (including impairment charges and other write offs of
intangible assets and goodwill but excluding any such non-Cash charge to the
extent that it represents an accrual or reserve for potential Cash items in any
future period or amortization of a prepaid Cash charge that was paid in a prior
period); and

(k) the amount of costs savings and synergies projected by Borrower in good
faith to be realized on or prior to September 30, 2012 as a result of the 2010
Transactions, net of the amount of actual cost savings and synergies realized
during such period as a result of the 2010 Transactions; provided that (i) such
cost savings and synergies are (A) reasonably identifiable, (B) factually
supportable and (C) certified by the chief financial officer (or the equivalent
thereof) of Borrower and (ii) the aggregate amount of such cost savings and
synergies increasing Consolidated Adjusted EBITDA pursuant to this clause
(k) shall not exceed $140,000,000; minus

(ii) non-Cash gains increasing Consolidated Net Income for such period
(excluding any such non-Cash gain to the extent it represents the reversal of an
accrual or reserve for potential Cash items in any prior period and any such
non-Cash gain relating to Cash received in a prior period (or to be received in
a future period)).

“Consolidated Capital Expenditures” means, for any period, the aggregate of all
expenditures of Borrower and its Subsidiaries during such period determined on a
consolidated basis that, in accordance with GAAP, are or should be included in
“purchase of property and equipment” or similar items reflected in the
consolidated statement of cash flows of Borrower and its Subsidiaries; provided
that Consolidated Capital Expenditures shall not include any expenditures
(i) for replacements and substitutions for fixed assets, capital assets or
equipment to the extent made with Net Insurance/Condemnation Proceeds invested
pursuant to Section 2.14(b) or with Net Asset Sale Proceeds invested pursuant to
Section 2.14(a), (ii) which constitute a Permitted Acquisition permitted under
Section 6.8, (iii) made by Borrower or any of its Subsidiaries to effect
leasehold improvements to any property leased by Borrower or such Subsidiary as
lessee, to the extent that such expenses have been reimbursed by the landlord or
(iv) made with the proceeds from the issuance of Equity Interests of Borrower
permitted hereunder that are Not Otherwise Applied.

 

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“Consolidated Current Assets” means, as at any date of determination with
respect to any Person, the total assets of such Person and its Subsidiaries on a
consolidated basis that may properly be classified as current assets in
conformity with GAAP, excluding Cash and Cash Equivalents.

“Consolidated Current Liabilities” means, as at any date of determination with
respect to any Person, the total liabilities of such Person and its Subsidiaries
on a consolidated basis that may properly be classified as current liabilities
in conformity with GAAP, excluding the current portion of long term debt.

“Consolidated Excess Cash Flow” means, for any period, an amount (if positive)
equal to:

(i) the sum, without duplication, of the amounts for such period of
(a) Consolidated Net Income, plus, (b) to the extent reducing Consolidated Net
Income, the sum, without duplication, of amounts for non Cash charges reducing
Consolidated Net Income (including for depreciation and amortization and
impairment charges and other write offs of intangible assets and goodwill but
excluding any such non Cash charge to the extent that it represents an accrual
or reserve for a potential Cash charge in any future period or amortization of a
prepaid Cash charge that was paid in a prior period), plus (c) the Consolidated
Working Capital Adjustment, minus

(ii) the sum, without duplication, of (a) the amounts for such period paid from
Internally Generated Cash of (1) scheduled repayments of Indebtedness for
borrowed money (excluding repayments of Revolving Loans or Swing Line Loans
except to the extent the Revolving Commitments are permanently reduced in
connection with such repayments) and scheduled repayments of obligations under
Capital Leases (excluding any interest expense portion thereof), and
(2) Consolidated Capital Expenditures, plus (b) other non Cash gains increasing
Consolidated Net Income for such period (excluding any such non Cash gain to the
extent it represents the reversal of an accrual or reserve for a potential Cash
charge in any prior period), plus (c) the aggregate amount of Restricted Junior
Payments made in Cash by Borrower or any of its Subsidiaries during such period
pursuant to clauses (e) and (g) of Section 6.4 using Internally Generated Cash,
except to the extent that such Restricted Junior Payments are made to fund
expenditures that reduce Consolidated Net Income, plus (d) the aggregate amount
of Investments made in cash by Borrower or any of its Subsidiaries during such
period pursuant to clauses (g), (h), (i), (j), (k) and (l) of Section 6.6 (other
than any intercompany Investments) using Internally Generated Cash. As used in
this clause (ii), “scheduled repayments of Indebtedness” do not include
mandatory prepayments or voluntary prepayments thereof.

“Consolidated Interest Expense” means, for any period, (a) total interest
expense (including imputed interest expense in respect of obligations under
Capital Leases as determined in accordance with GAAP as well as interest
required to be capitalized in accordance with GAAP) of Borrower and its
Subsidiaries on a consolidated basis for such period with respect to all
outstanding Indebtedness of Borrower and its Subsidiaries, including all
commissions, discounts and other fees and charges owed with respect to letters
of credit and the net effect of Interest Rate Agreements, but excluding,
however, any amount not payable in Cash during such period and any amounts
referred to in Section 2.11(c) payable on or before the Third Restatement Date,
minus (b) total interest income of Borrower and its Subsidiaries on a
consolidated basis for such period.

“Consolidated Net Income” means, for any period, the net income (or loss) of
Borrower and its Subsidiaries on a consolidated basis for such period taken as a
single accounting period determined in conformity with GAAP, provided that there
will be excluded (a) the income (or loss) of any Person (other than a Subsidiary
of Borrower) in which any other Person (other than Borrower or any of its
Subsidiaries) has a joint interest, except to the extent of the amount of
dividends or other distributions actually paid to

 

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Borrower or any of its Subsidiaries by such Person during such period,
(b) except as otherwise expressly provided herein, the income (or loss) of any
Person accrued prior to the date it becomes a Subsidiary of Borrower or is
merged into or consolidated with Borrower or any of its Subsidiaries or the
income (or loss) in respect of the assets of any Person accrued prior to the
date such assets are acquired by Borrower or any of its Subsidiaries, (c) the
income of any Subsidiary of Borrower (other than any such Subsidiary that is a
Credit Party) during such period to the extent that the declaration or payment
of dividends or similar distributions by that Subsidiary of that income is not
at the time permitted by operation of the terms of its charter or any agreement,
instrument, judgment, decree, order, statute, rule or governmental regulation
applicable to that Subsidiary, (d) any after tax gains or losses attributable to
Asset Sales and casualty or condemnation events (of the type described in the
definition of “Net Insurance/Condemnation Proceeds”) or returned surplus assets
of any Pension Plan, in each case accrued during such period, (e) (to the extent
not included in clauses (a) through (d) above) any net extraordinary gains or
net extraordinary losses accrued during such period, (f) the cumulative effect
of a change in accounting principles and (g) solely for purposes of calculating
the CNI Growth Amount for such period, amortization or depreciation expense
incurred during such period with respect to assets that are used or useful in
the business or lines of business in which Borrower and/or its Subsidiaries are
engaged as of the Third Restatement Date or similar or related or ancillary
businesses; provided further that, without duplication of amounts included in
clause (a) of the preceding proviso, the net income of a Specified Joint Venture
for such period shall be included in the calculation of Consolidated Net Income
in proportion to Borrower and its Subsidiaries’ Equity Interests in such
Specified Joint Venture (provided that the net income of all Specified Joint
Ventures included pursuant to this proviso for any period shall not exceed 10%
of the aggregate Consolidated Net Income for Borrower and its Subsidiaries for
such period).

“Consolidated Secured Indebtedness” means, as of any date of determination,
Consolidated Total Debt that is secured by a Lien on any assets of Borrower and
its Subsidiaries.

“Consolidated Total Assets” means, as of any date of determination, the total
assets of Borrower and its Subsidiaries, determined on a consolidated basis in
accordance with GAAP.

“Consolidated Total Debt” means, as at any date of determination, the aggregate
principal amount of all Indebtedness of Borrower and its Subsidiaries determined
on a consolidated basis in accordance with GAAP (net of unrestricted and
unencumbered Cash and Cash Equivalents of Borrower and its Subsidiaries as of
such date in an amount not to exceed $150,000,000), provided that the term
“Indebtedness” (for purposes of this definition) shall not include any letter of
credit, except to the extent of unreimbursed amounts thereunder, provided that
Consolidated Total Debt shall not include (x) any unreimbursed amount under
commercial letters of credit until one (1) day after such amount is drawn and
(y) the Net Mark-to-Market Exposure of any Hedge Agreement, provided further
that, for purposes of the definition of “Consolidated Total Debt” the
Indebtedness in respect of convertible debt securities shall be deemed to be the
aggregate principal amount thereof outstanding as of such date of determination.

“Consolidated Working Capital” means, as at any date of determination, the
Consolidated Current Assets of Borrower minus the Consolidated Current
Liabilities of Borrower, in each case as of such date. Consolidated Working
Capital at any date may be a positive or negative number.

“Consolidated Working Capital Adjustment” means, for any period on a
consolidated basis, the Consolidated Working Capital as of the beginning of such
period minus the Consolidated Working Capital as of the end of such period. The
Consolidated Working Capital Adjustment for any period may be a positive or
negative number. In calculating the Consolidated Working Capital Adjustment
there shall be excluded the effect of reclassification during such period of
current assets to long term assets and current liabilities to long term
liabilities and the effect of any Permitted Acquisition during such period.

 

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“Contractual Obligation” means, as applied to any Person, any provision of any
Security issued by that Person or of any indenture, mortgage, deed of trust,
contract, undertaking, agreement or other instrument to which that Person is a
party or by which it or any of its properties is bound or to which it or any of
its properties is subject.

“Contribution Agreement” means a contribution agreement substantially in the
form of Exhibit L among the Credit Parties and Administrative Agent.

“Conversion/Continuation Date” means the effective date of a continuation or
conversion, as the case may be, as set forth in the applicable
Conversion/Continuation Notice.

“Conversion/Continuation Notice” means a Conversion/Continuation Notice
substantially in the form of Exhibit A-2.

“Counterpart Agreement” means a Counterpart Agreement substantially in the form
of Exhibit G delivered by a Credit Party pursuant to Section 5.10 or a similar
agreement, in form and substance reasonably acceptable to the Administrative
Agent, pursuant to which any Credit Party becomes a Guarantor hereunder. Such
Counterpart Agreement may, if reasonably requested by Borrower, include
limitations on guarantees applicable to such Subsidiary and required under
Applicable Law.

“Credit Date” means the date of a Credit Extension.

“Credit Document” means any of this Agreement, the Notes, if any, the Canadian
Guarantee, the Barbados Guarantee, the Counterpart Agreements, if any, the
Collateral Documents, the Canadian Confirmation of Guarantee and Security, any
documents or certificates executed by Borrower in favor of Issuing Bank relating
to Letters of Credit, and all other documents, instruments or agreements
executed and delivered by or on behalf of or at the request of a Credit Party
(or any officer of a Credit Party pursuant to the terms hereof) for the benefit
of any Agent, Issuing Bank or any Lender in connection herewith on or after the
date hereof and all annexes, appendices, schedules and exhibits to any of the
foregoing, as may be amended, restated, supplemented or otherwise modified from
time to time.

“Credit Extension” means the making of a Loan or the issuing of a Letter of
Credit.

“Credit Party” means Borrower and each Guarantor.

“Cumulative Consolidated Net Income” means, as of any date of determination,
Consolidated Net Income of Borrower and its Subsidiaries for the period (taken
as one accounting period) commencing on the first day of the Fiscal Quarter of
Borrower ending on September 30, 2011 and ending on the last day of the most
recently ended Fiscal Quarter or Fiscal Year, as applicable, for which financial
statements required to be delivered pursuant to Section 5.1(a) or
Section 5.1(b), and the related Compliance Certificate required to be delivered
pursuant to Section 5.1(c), have been received by Administrative Agent.

“Currency Agreement” means any foreign exchange contract, currency swap
agreement, futures contract, option contract, synthetic cap or other similar
agreement or arrangement, each of which is for the purpose of hedging the
foreign currency risk associated with Borrower’s and its Subsidiaries’
operations and not for speculative purposes.

“Default” means a condition or event that, after notice or lapse of time or
both, would constitute an Event of Default.

 

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“Default Excess” means, with respect to any Funds Defaulting Lender, the excess,
if any, of such Defaulting Lender’s Pro Rata Share of the aggregate outstanding
principal amount of Loans of all Lenders (calculated as if all Funds Defaulting
Lenders (including such Funds Defaulting Lender) had funded all of their
respective Defaulted Loans) over the aggregate outstanding principal amount of
all Loans of such Funds Defaulting Lender.

“Default Period” means, (x) with respect to any Funds Defaulting Lender, the
period commencing on the date that such Lender became a Funds Defaulting Lender
and ending on the earliest of: (i) the date on which all Commitments are
cancelled or terminated and/or the Obligations are declared or become
immediately due and payable, (ii) the date on which (a) the Default Excess with
respect to such Defaulting Lender shall have been reduced to zero (whether by
the funding by such Defaulting Lender of any Defaulted Loans of such Defaulting
Lender or by the non pro rata application of any voluntary or mandatory
prepayments of the Loans in accordance with the terms of Section 2.13 or
Section 2.14 or by a combination thereof) or such Defaulting Lender shall have
paid all amounts due under Section 9.6, as the case may be, and (b) such
Defaulting Lender shall have delivered to Borrower and Administrative Agent a
written reaffirmation of its intention to honor its obligations hereunder with
respect to its Commitments, and (iii) the date on which Borrower, Administrative
Agent and Requisite Lenders waive all failures of such Defaulting Lender to fund
or make payments required hereunder in writing; and (y) with respect to any
Insolvency Defaulting Lender, the period commencing on the date such Lender
became an Insolvency Defaulting Lender and ending on the earliest of the
following dates: (i) the date on which all Commitments are cancelled or
terminated and/or the Obligations are declared or become immediately due and
payable and (ii) the date that such Defaulting Lender ceases to hold any portion
of the Loans or Commitments.

“Defaulted Loan” means any Revolving Loan or portion of any unreimbursed payment
under Section 2.3(b)(v) or 2.4(e) not made by any Lender when required
hereunder.

“Defaulting Lender” means any Funds Defaulting Lender or Insolvency Defaulting
Lender.

“Defined Benefit Plan” means any Canadian Employee Benefit Plan which contains a
“defined benefit provision,” as defined in subsection 147.1(1) of the Income Tax
Act (Canada).

“Delayed Draw Commitment” as defined in the Second Amended and Restated Credit
Agreement.

“Delayed Draw Term Loan” means a Tranche A Term Loan made by a Lender pursuant
to Section 2.1(a)(ii) of the Second Amended and Restated Credit Agreement.

“Deposit Account” means a demand, time, savings, passbook or like account with a
bank, savings and loan association, credit union or like organization, other
than an account evidenced by a negotiable certificate of deposit.

“Dermik Acquisition” means the acquisition of certain assets and rights, and
assumption of certain liabilities, relating to Dermik, a business unit of
Sanofi, by Borrower and certain of its wholly-owned Subsidiaries pursuant to
that certain asset purchase agreement, dated as of July 8, 2011, by and among
Sanofi, Borrower and Valeant International (Barbados) SRL, including the
disclosure letter, schedules, annexes and exhibits attached thereto and all
material documents related to the consummation of the transactions contemplated
thereby, as amended, modified and supplemented.

“Designated Noncash Consideration” means non-Cash consideration received by
Borrower or any of its Subsidiaries in connection with an Asset Sale that is
designated by Borrower as Designated

 

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Noncash Consideration, less the amount of Cash received in connection with a
subsequent sale of such Designated Noncash Consideration, which Cash shall be
considered Net Asset Sale Proceeds received as of such date and shall be applied
pursuant to Section 2.14(a).

“Disqualified Equity Interests” means any Equity Interest which, 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 (i) matures or is mandatorily redeemable (other than solely for
Equity Interests which are not otherwise Disqualified Equity Interests),
pursuant to a sinking fund obligation or otherwise, (ii) is redeemable at the
option of the holder thereof (other than solely for Equity Interests which are
not otherwise Disqualified Equity Interests), in whole or in part,
(iii) provides for scheduled payments or dividends in cash, or (iv) is or
becomes convertible into or exchangeable for Indebtedness or any other Equity
Interests that would constitute Disqualified Equity Interests, in each case,
prior to the date that is 91 days after the latest Term Loan Maturity Date,
except, in the case of clauses (i) and (ii), if as a result of a change of
control or asset sale, so long as any rights of the holders thereof upon the
occurrence of such a change of control or asset sale event are subject to the
prior payment in full of all Obligations (other than contingent amounts not yet
due), the cancellation or expiration of all Letters of Credit and the
termination of the Commitments).

“Dollars” and the sign “$” mean the lawful money of the United States of
America.

“Domestic Subsidiary” means any Subsidiary organized under the laws of the
United States of America, any State thereof or the District of Columbia.

“Eligible Assignee” means any Person other than a natural Person that is (i) a
Lender, an Affiliate of any Lender or a Related Fund (any two or more Related
Funds being treated as a single Eligible Assignee for all purposes hereof) or
(ii) a commercial bank, insurance company, investment or mutual fund or other
entity that is an “accredited investor” (as defined in Regulation D under the
Securities Act or as defined under the Canadian Securities Administrators
National Instrument 45-106, as amended, supplemented, replaced or otherwise
modified from time to time) and which extends credit or buys loans in the
ordinary course of business; provided, neither any Credit Party nor any
Affiliate thereof shall be an Eligible Assignee.

“Employee Benefit Plan” means, in respect of any Credit Party, any “employee
benefit plan” as defined in Section 3(3) of ERISA which is or was sponsored,
maintained or contributed to by, or required to be contributed by, Borrower, any
of its Subsidiaries or any of its ERISA Affiliates in each case other than any
Canadian Employee Benefit Plan.

“Environmental Claim” means any notice of violation, claim, legal charge,
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
or liability under any Environmental Law; (ii) in connection with any Hazardous
Material or any actual or alleged Release or threat of Release of any Hazardous
Materials; 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 the common law, any and all foreign or domestic,
federal, state or provincial (or any subdivision of either of them) statutes,
ordinances, by-laws, orders, rules, codes, guidelines, regulations, judgments,
Governmental Authorizations, or any other requirements of Governmental
Authorities relating to (i) the generation, use, storage, treatment, presence,
handling, abatement, remediation, transportation or Release or threat of Release
of Hazardous Materials; (ii) as it relates to exposure to Hazardous Materials,
occupational safety and health and industrial hygiene; or (iii) land use or the
protection of the environment, natural resources, or human, plant or animal
safety, health or welfare, in each of cases (i) through (iii), in any manner
applicable to Borrower or any of its Subsidiaries or any Facility.

 

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“Equity Interests” means any and all shares, interests, participations or other
equivalents (however designated) of capital stock of a corporation, any and all
equivalent ownership interests in a Person (other than a corporation), including
partnership interests and membership interests, and any and all warrants, rights
or options to purchase or other arrangements or rights to acquire any of the
foregoing (excluding convertible securities to the extent constituting
“Indebtedness” for purposes of this Agreement).

“Equivalent Amount” means, at any time, (a) with respect to Dollars or an amount
denominated in Dollars, such amount and (b) with respect to an amount
denominated in a currency other than Dollars, the equivalent amount thereof in
Dollars at such time on the basis of the Spot Rate as of such time for the
purchase of Dollars with such currency.

“ERISA” means the Employee Retirement Income Security Act of 1974, as amended
from time to time, and any successor thereto.

“ERISA Affiliate” means, as applied to any Person, (i) any corporation which is
a member of a controlled group of corporations within the meaning of
Section 414(b) of the Internal Revenue Code of which that Person is a member;
(ii) any trade or business (whether or not incorporated) which is a member of a
group of trades or businesses under common control within the meaning of
Section 414(c) of the Internal Revenue Code of which that Person is a member;
and (iii) any member of an affiliated service group within the meaning of
Section 414(m) or (o) of the Internal Revenue Code of which that Person, any
corporation described in clause (i) above or any trade or business described in
clause (ii) above is a member. Any former ERISA Affiliate of Borrower or any of
its Subsidiaries shall continue to be considered an ERISA Affiliate of Borrower
or any such Subsidiary within the meaning of this definition with respect to the
period such entity was an ERISA Affiliate of Borrower or such Subsidiary and
with respect to liabilities arising after such period for which Borrower or such
Subsidiary could be liable under the Internal Revenue Code or ERISA.

“ERISA Event” means (i) a “reportable event” within the meaning of Section 4043
of ERISA and the regulations issued thereunder with respect to any Pension Plan
(excluding those for which the provision for 30 day notice to the PBGC has been
waived by regulation); (ii) the failure to meet the minimum funding standard of
Section 412 of the Internal Revenue Code with respect to any Pension Plan
(whether or not waived in accordance with Section 412(c) of the Internal Revenue
Code) or the failure to make by its due date a required installment under
Section 430(j) of the Internal Revenue Code with respect to any Pension Plan or
the failure to make any required contribution to a Multiemployer Plan; (iii) the
provision by the administrator of any Pension Plan pursuant to
Section 4041(a)(2) of ERISA of a notice of intent to terminate such plan in a
distress termination described in Section 4041(c) of ERISA; (iv) the withdrawal
by Borrower, any of its Subsidiaries or any of their respective ERISA Affiliates
from any Pension Plan with two or more contributing sponsors or the termination
of any such Pension Plan resulting in liability to Borrower, any of its
Subsidiaries or any of their respective ERISA Affiliates pursuant to
Section 4063 or 4064 of ERISA; (v) the institution by the PBGC of proceedings to
terminate any Pension Plan, or the occurrence of any event or condition which
might constitute grounds under ERISA for the termination of, or the appointment
of a trustee to administer, any Pension Plan; (vi) the imposition of liability
on Borrower, any of its Subsidiaries or any of their respective ERISA Affiliates
pursuant to Section 4062(e) or 4069 of ERISA or by reason of the application of
Section 4212(c) of ERISA; (vii) the withdrawal of Borrower, any of its
Subsidiaries or any of their respective ERISA Affiliates in a complete or
partial withdrawal (within the meaning of Sections 4203 and 4205 of ERISA) from
any Multiemployer Plan if there is any potential liability therefore, or the
receipt by Borrower, any of its Subsidiaries or any of their respective ERISA
Affiliates of notice from any Multiemployer Plan that it is in reorganization or

 

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insolvency pursuant to Section 4241 or 4245 of ERISA, or that it intends to
terminate or has terminated under Section 4041A or 4042 of ERISA; (viii) the
occurrence of an act or omission which could give rise to the imposition on
Borrower, any of its Subsidiaries or any of their respective ERISA Affiliates of
fines, penalties, taxes or related charges under Chapter 43 of the Internal
Revenue Code or under Section 409, Section 502(c), (i) or (l), or Section 4071
of ERISA in respect of any Employee Benefit Plan; (ix) the assertion of a
material claim (other than routine claims for benefits) against any Employee
Benefit Plan other than a Multiemployer Plan or the assets thereof, or against
Borrower, any of its Subsidiaries or any of their respective ERISA Affiliates in
connection with any Employee Benefit Plan; (x) receipt from the Internal Revenue
Service of notice of the failure of any Pension Plan (or any other Employee
Benefit Plan intended to be qualified under Section 401(a) of the Internal
Revenue Code) to qualify under Section 401(a) of the Internal Revenue Code, or
the failure of any trust forming part of any Pension Plan to qualify for
exemption from taxation under Section 501(a) of the Internal Revenue Code; or
(xi) the imposition of a Lien on the assets of Borrower, any of its Subsidiaries
or any of their respective ERISA Affiliates pursuant to Section 430(k) of the
Internal Revenue Code or ERISA or a violation of Section 436 of the Internal
Revenue Code by Borrower, any of its Subsidiaries or any of their respective
ERISA Affiliates.

“Eurodollar Rate Loan” means a Loan bearing interest at a rate determined by
reference to the Adjusted Eurodollar Rate.

“Event of Default” means each of the conditions or events set forth in
Section 8.1.

“Exchange Act” means the Securities Exchange Act of 1934, as amended from time
to time, and any successor statute.

“Excluded Subsidiary” means (a) any Subsidiary that is not a wholly-owned
Subsidiary and (b) any Immaterial Subsidiary.

“Excluded Taxes” means, with respect to any Agent, any Lender (including each
Swing Line Lender and Issuing Bank) or any other recipient of any payment to be
made by or on account of any obligation of any Credit Party hereunder or under
any other Credit Document, (a) any Taxes imposed on (or measured by) its net
income or profits (or any franchise or similar Taxes in lieu thereof) or, in the
case of Canada, capital, by a jurisdiction as a result of (i) the recipient
being organized, resident or, in the case of any Lender, having its lending
office located or (ii) the recipient carrying on or being engaged in or being
deemed to carry on or be engaged in a trade or business (including having a
permanent establishment) for Tax purposes (other than any trade or business
arising or deemed to arise from such recipient 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
transactions pursuant to, or enforced, any Credit Documents), in such
jurisdiction (including any political subdivision of such jurisdiction), (b) any
branch profits tax within the meaning of section 884(a) of the Internal Revenue
Code or similar Tax imposed by any jurisdiction described in clause (a) and
(c) any withholding tax (including U.S. federal backup withholding tax) that is
attributable to a Lender’s failure to comply with Section 2.20(d).

“Extending Lender” as defined in Section 10.5(d).

“Facility” means any real property (including all buildings, fixtures or other
improvements located thereon) now, hereafter or heretofore owned, leased,
operated or used by Borrower or any of its Subsidiaries or any of their
respective predecessors or Affiliates.

“Federal Funds Effective Rate” means, for any day, the rate per annum (expressed
as a decimal, rounded upwards, if necessary, to the next higher 1/100 of 1%)
equal to the weighted average of the rates on overnight Federal funds
transactions with members of the Federal Reserve System arranged by Federal

 

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funds brokers on such day, as published by the Federal Reserve Bank of New York
on the Business Day next succeeding such day; provided that, (i) if such day is
not a Business Day, the Federal Funds Rate for such day shall be such rate on
such transactions on the next preceding Business Day as so published on the next
succeeding Business Day, and (ii) if no such rate is so published on such next
succeeding Business Day, the Federal Funds Rate for such day shall be the
average (rounded upwards, if necessary, to the next higher 1/100 of 1%) of the
quotations for such day for such transactions received by the Administrative
Agent from three Federal funds brokers of recognized standing selected by it.

“Financial Officer Certification” means, with respect to the financial
statements for which such certification is required, the certification of the
chief financial officer (or the equivalent thereof) of Borrower that such
financial statements fairly present, in all material respects, the financial
condition of Borrower and its Subsidiaries as at the dates indicated and the
results of their operations and their cash flows for the periods indicated,
subject to changes resulting from audit and normal year end adjustments.

“Financial Plan” as defined in Section 5.1(i).

“First Amended and Restated Credit Agreement” as defined in the recitals.

“First Restatement Date” means August 10, 2011.

“First Priority” means, with respect to any Lien purported to be created in any
Collateral pursuant to any Collateral Document, that such Lien is the only Lien
to which such Collateral is subject, other than any Permitted Lien.

“Fiscal Quarter” means a fiscal quarter of any Fiscal Year.

“Fiscal Year” means the fiscal year of Borrower and its Subsidiaries ending on
December 31 of each calendar year.

“Flood Hazard Property” means any Real Estate Asset subject to a Mortgage in
favor of Collateral Agent, for the benefit of the Secured Parties, and located
in an area designated by the Federal Emergency Management Agency as having
special flood or mud slide hazards.

“Foreign Subsidiary” means any Subsidiary that is not a Domestic Subsidiary.

“Funding Notice” means a notice substantially in the form of Exhibit A-1.

“Funds Defaulting Lender” means any Lender who (i) defaults in its obligation to
fund any Revolving Loan or its portion of any unreimbursed payment under
Section 2.3(b)(v) or 2.4(e) or its Pro Rata Share of any payment under
Section 9.6, (ii) has notified Borrower or Administrative Agent in writing, or
has made a public statement, that it does not intend to comply with its
obligation to fund any Revolving Loan or its portion of any unreimbursed payment
under Section 2.3(b)(v) or 2.4(e) or its Pro Rata Share of any payment under
Section 9.6, (iii) has failed to confirm that it will comply with its obligation
to fund any Revolving Loan or its portion of any unreimbursed payment under
Section 2.3(b)(v) or 2.4(e) or its Pro Rata Share of any payment under
Section 9.6 within five Business Days after written request for such
confirmation from Administrative Agent (which request may only be made after all
conditions to funding have been satisfied); provided that such Lender shall
cease to be a Funds Defaulting Lender upon receipt of such confirmation by
Administrative Agent, or (iv) has failed to pay to Administrative Agent or any
other Lender any amount (other than its portion of any Revolving Loan or amounts
required to be paid under Section 2.3(b)(v), 2.4(e) or 9.6 or any other amount
that is de minimis) due under any Credit Document within five Business Days of
the date due, unless such amount is the subject of a good faith dispute.

 

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“GAAP” means, subject to the limitations on the application thereof set forth in
Section 1.2, United States generally accepted accounting principles in effect as
of the date of determination thereof.

“Governmental Acts” means any act or omission, whether rightful or wrongful, of
any present or future de jure or de facto government or Governmental Authority.

“Governmental Authority” means any federal, state, provincial, territorial,
municipal, national or other government, governmental department, commission,
board, bureau, court, agency, organization, central bank, tribunal or
instrumentality or political subdivision thereof or any other entity, officer or
examiner exercising executive, legislative, judicial, regulatory, governmental
(quasi-governmental) or administrative functions of or pertaining to any
government or any court or central bank, in each case whether associated with a
state of the United States, the United States, a province or territory of
Canada, Canada, Barbados, or a foreign entity or government.

“Governmental Authorization” means any permit, license, approval, authorization,
plan, directive, direction, certificate, accreditation, registration, notice,
agreement, consent order or consent decree or other like instrument of, from or
required by any Governmental Authority.

“Grantor” means Borrower and each of its Subsidiaries, in each case granting a
Lien to Collateral Agent to secure any Obligations.

“GSLP” as defined in the preamble hereto.

“Guarantee” of or by any Person (the “guarantor”) means any obligation,
contingent or otherwise, of the guarantor guaranteeing or having the economic
effect of guaranteeing any Indebtedness or other obligation of any other Person
(the “primary obligor”) in any manner, whether directly or indirectly, and
including any obligation of the guarantor, direct or indirect, (a) to purchase
or pay (or advance or supply funds for the purchase or payment of) such
Indebtedness or other obligation or to purchase (or to advance or supply funds
for the purchase of) any security for the payment thereof, (b) to purchase or
lease property, securities or services for the purpose of assuring the owner of
such Indebtedness or other obligation of the payment thereof, (c) to maintain
working capital, equity capital or any other financial statement condition or
liquidity of the primary obligor so as to enable the primary obligor to pay such
Indebtedness or other obligation or (d) as an account party in respect of any
letter of credit or letter of guaranty issued to support such Indebtedness or
obligation, provided that the term Guarantee shall not include endorsements for
collection or deposit in the ordinary course of business. The term “Guarantee”
as a verb has a corresponding meaning.

“Guaranteed Obligations” as defined in Section 7.1.

“Guarantor” means, (i) on the Third Restatement Date, each of Borrower’s
Subsidiaries listed on Schedule 1.1(b) and (ii) thereafter, any Person that
executes a Counterpart Agreement, a Canadian Guarantee or a Barbados Guarantee
pursuant to Section 5.10.

“Guarantor Subsidiary” means each Guarantor other than Borrower.

“Guaranty” means the guaranty of each Guarantor set forth in Section 7.

 

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“Hazardous Materials” means any chemical, material or substance: (i) that is
prohibited, limited, restricted or otherwise regulated under Environmental Laws,
(ii) that may or could reasonably be expected to 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, or (iii) that are included in the
definition of “hazardous substances,” “waste,” “hazardous waste,” “hazardous
materials,” “toxic substances,” “pollutants,” “polluting substance,”
“contaminants,” “contamination,” “dangerous goods,” “deleterious substances” or
words of similar import under any Environmental Law.

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

“Highest Lawful Rate” means the maximum lawful interest rate, if any, that at
any time or from time to time may be contracted for, charged, or received under
the laws applicable to any Lender which are presently in effect or, to the
extent allowed by law, under such Applicable Law which may hereafter be in
effect and which allow a higher maximum nonusurious interest rate than
Applicable Law now allows.

“Historical Financial Statements” means as of the Third Restatement Date,
(i) the audited consolidated financial statements of Borrower and its
Subsidiaries, for the immediately preceding three Fiscal Years ended more than
90 days prior to the Third Restatement Date, consisting of consolidated balance
sheets and the related consolidated statements of income, stockholders’ equity
and cash flows for such Fiscal Years, and (ii) the unaudited consolidated
financial statements of Borrower and its Subsidiaries as of the most recent
ended Fiscal Quarter after the date of the most recent audited consolidated
financial statements and ended at least 45 days prior to the Third Restatement
Date, consisting of a consolidated balance sheet and the related consolidated
statements of income and cash flows for the three-, six- or nine-month period,
as applicable, ending on such date, and, in each case, certified by the chief
financial officer of Borrower that they fairly present, in all material
respects, the financial condition of Borrower and its Subsidiaries,
respectively, as at the dates indicated and the results of their operations and
their cash flows for the periods indicated, subject to changes resulting from
audit and normal year end adjustments and the absence of footnotes in the case
of the unaudited consolidated financial statements.

“Immaterial Subsidiary” means any Subsidiary of Borrower, designated in writing
to Administrative Agent by Borrower as an “Immaterial Subsidiary,” that,
individually and collectively with all other Immaterial Subsidiaries as of the
relevant date of determination, has (i) total assets as of such date of less
than 7.5% of Consolidated Total Assets as of such date and (ii) total revenues
for the ended four-fiscal-quarter period most recently ended prior to such date
of less than 7.5% of the consolidated total revenues of Borrower and its
Subsidiaries for such period. It is understood and agreed that Borrower may,
from time to time, redesignate any Immaterial Subsidiary as a non-Immaterial
Subsidiary to the extent that the requirements set forth in Section 5.10 are
satisfied with respect to such Subsidiary at or prior to the date of such
redesignation.

“Increased Amount Date” as defined in Section 2.25.

“Increased Cost Lender” as defined in Section 2.23.

 

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“Indebtedness” means, as applied to any Person, without duplication, (i) all
indebtedness of such Person for borrowed money (including for the avoidance of
doubt, convertible debt securities); (ii) that portion of obligations of such
Person with respect to Capital Leases that is properly classified as a liability
on a balance sheet of such Person in conformity with GAAP; (iii) notes payable
and drafts accepted representing extensions of credit to such Person whether or
not representing obligations for borrowed money; (iv) any obligation of such
Person owed for all or any part of the deferred purchase price of property or
services including any earn out obligations to the extent required to be
reflected on a consolidated balance sheet of Borrower prepared in accordance
with GAAP (excluding any such obligations incurred under ERISA), which purchase
price is (a) due more than twelve months from the date of incurrence of the
obligation in respect thereof or (b) evidenced by a note or similar written
instrument; (v) all indebtedness of such Person secured by any Lien on any
property or asset owned or held by such Person regardless of whether the
indebtedness secured thereby shall have been assumed by such Person or is
nonrecourse to the credit of such Person; (vi) the face amount of any letter of
credit issued for the account of such Person or as to which that Person is
otherwise liable for reimbursement of drawings; (vii) Disqualified Equity
Interests issued by such Person; (viii) the direct or indirect guaranty,
endorsement (otherwise than for collection or deposit in the ordinary course of
business), co making, discounting with recourse or sale with recourse by such
Person of the obligation of another Person to the extent such obligation would
constitute Indebtedness pursuant to any of clauses (i) through (vii) or clause
(xi) hereof; (ix) any obligation of such Person the primary purpose or intent of
which is to provide assurance to an obligee that the obligation constituting
Indebtedness pursuant to clauses (i) through (vii) or (xi) hereof of the obligor
thereof will be paid or discharged, or any agreement relating thereto will be
complied with, or the holders thereof will be protected (in whole or in part)
against loss in respect thereof; (x) any liability of such Person for an
obligation constituting Indebtedness pursuant to clauses (i) through (vii) or
(xi) hereof of another through any agreement (contingent or otherwise) (a) to
purchase, repurchase or otherwise acquire such obligation or any security
therefor, or to provide funds for the payment or discharge of such obligation
(whether in the form of loans, advances, stock purchases, capital contributions
or otherwise) or (b) to maintain the solvency or any balance sheet item, level
of income or financial condition of another if, in the case of any agreement
described under subclauses (a) or (b) of this clause (x), the primary purpose or
intent thereof is as described in clause (ix) above; and (xi) the Net
Mark-to-Market Exposure of any Hedge Agreement. The amount of Indebtedness of
any Person for purposes of clause (v) above shall (unless such Indebtedness has
been assumed by such Person) be deemed to be equal to the lesser of (i) the
aggregate unpaid amount of such Indebtedness and (ii) the fair market value of
the property encumbered thereby as determined by such Person in good faith.

“Indemnified Liabilities” means, collectively, any and all liabilities,
obligations, losses, damages (expectation, reliance or otherwise, and including
natural resource damages), penalties, claims (including Environmental Claims),
fines, orders, actions, judgments, suits, costs (including the costs of any
investigation, study, sampling, testing, abatement, cleanup, removal,
remediation or other response action necessary to remove, remediate, clean up or
abate any Release or threat of Release of Hazardous Materials) and expenses
(including the reasonable fees and disbursements of counsel for Indemnitees in
connection with any investigative, administrative or judicial proceeding or
hearing commenced or threatened by any Person, whether or not any such
Indemnitee shall be designated as a party or a potential party thereto, and any
fees or expenses incurred by Indemnitees in enforcing this indemnity), whether
direct, indirect or consequential and whether based on any Applicable Law or on
contract or otherwise, that may be issued to, imposed on, incurred or suffered
by, or asserted against any such Indemnitee, in any manner relating to or
arising out of (i) this Agreement or the other Credit Documents or the
transactions contemplated hereby or thereby (including the Lenders’ agreement to
make Credit Extensions (including, for the avoidance of doubt, any Issuing Bank
agreement to issue Letters of Credit), the syndication of the credit facilities
provided for herein or the use or intended use of the proceeds thereof, or any
enforcement of any of the Credit Documents (including any sale of, collection
from, or other realization upon any of the Collateral or the enforcement of the
Guaranty)) or (ii) any Environmental Claim or any Release or threat of

 

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Release of Hazardous Materials related to Borrower or any of its Subsidiaries,
including such claims or activities relating to or arising from, directly or
indirectly, any past or present activity, operation, land ownership, occupation
or use, or practice by or of Borrower or any of its Subsidiaries.

“Indemnified Taxes” means any Taxes other than Excluded Taxes and Other Taxes.

“Indemnitee” as defined in Section 10.3(a).

“Indemnitee Agent Party” as defined in Section 9.6.

“Initial Draw Tranche A Term Loan” means a Tranche A Term Loan made by a Lender
to Borrower pursuant to Section 2.1(a)(i) of the Second Amended and Restated
Credit Agreement.

“Insolvency Defaulting Lender” means any Lender with a Revolving Commitment or
Term Loan Commitment who (i) has been adjudicated as, or determined by any
Governmental Authority having regulatory authority over such Person or its
assets to be, insolvent, (ii) becomes the subject of an insolvency, bankruptcy,
dissolution, liquidation or reorganization proceeding, or (iii) becomes the
subject of an appointment of a receiver, intervenor or conservator under any
Insolvency Laws now or hereafter in effect; provided that a Lender shall not be
an Insolvency Defaulting Lender solely by virtue of the ownership or acquisition
by a Governmental Authority or an instrumentality thereof of any Equity Interest
in such Lender or a parent company thereof.

“Insolvency Laws” means any of the Bankruptcy Code, the BIA, the CCAA, the WURA
and the CBCA, and any other applicable insolvency, corporate arrangement or
restructuring or other similar law of any jurisdiction including any law of any
jurisdiction permitting a debtor to obtain a stay or a compromise of the claims
of its creditors against it.

“Installment” as defined in Section 2.12.

“Installment Date” as defined in Section 2.12.

“Intellectual Property” as defined in the Second Amended and Restated Pledge and
Security Agreement, the Canadian Pledge and Security Agreement, the Quebec
Security Documents, the Barbados Security Documents, the Luxembourg Security
Documents and the Swiss Security Documents, as applicable.

“Intellectual Property Security Agreements” has the meaning assigned to that
term in the Second Amended and Restated Pledge and Security Agreement and the
Canadian Pledge and Security Agreement, as applicable.

“Intercompany Note” means a promissory note substantially in the form of Exhibit
J-1 evidencing Indebtedness owed among Credit Parties and their Subsidiaries.

“Interest Coverage Ratio” means the ratio as of the last day of any Fiscal
Quarter of (i) Consolidated Adjusted EBITDA for the four Fiscal Quarter period
then ended to (ii) Consolidated Interest Expense for such four Fiscal Quarter
period.

“Interest Payment Date” means with respect to (i) any Loan that is a Base Rate
Loan, each March 31, June 30, September 30 and December 31 of each year,
commencing on the first such date to occur after the Third Restatement Date, and
the final maturity date of such Loan; and (ii) any Loan that is a Eurodollar
Rate Loan, the last day of each Interest Period applicable to such Loan;
provided that, in the case of each Interest Period of longer than three months
“Interest Payment Date” shall also include each date that is three months, or an
integral multiple thereof, after the commencement of such Interest Period.

 

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“Interest Period” means, in connection with a Eurodollar Rate Loan, an interest
period of one, two, three or six months (or interest periods of nine or twelve
months if mutually agreed upon by Borrower and the applicable Lenders), as
selected by Borrower in the applicable Funding Notice or Conversion/Continuation
Notice, (i) initially, commencing on the Credit Date or Conversion/Continuation
Date thereof, as the case may be; and (ii) thereafter, commencing on the day on
which the immediately preceding Interest Period expires; provided that, (a) if
an Interest Period would otherwise expire on a day that is not a Business Day,
such Interest Period shall expire on the next succeeding Business Day unless no
further Business Day occurs in such month, in which case such Interest Period
shall expire on the immediately preceding Business Day; (b) any Interest Period
that begins on the last Business Day of a calendar month (or on a day for which
there is no numerically corresponding day in the calendar month at the end of
such Interest Period) shall, subject to clauses (c) and (d), of this definition,
end on the last Business Day of a calendar month; (c) no Interest Period with
respect to any portion of any Class of Term Loans shall extend beyond such
Class’s Term Loan Maturity Date; and (d) no Interest Period with respect to any
portion of the Revolving Loans shall extend beyond the Revolving Commitment
Termination Date.

“Interest Rate Agreement” means any interest rate swap agreement, interest rate
cap agreement, interest rate collar agreement, interest rate hedging agreement
or other similar agreement or arrangement.

“Interest Rate Determination Date” means, with respect to any Interest Period,
the date that is two Business Days prior to the first day of such Interest
Period.

“Internal Revenue Code” means the Internal Revenue Code of 1986, as amended to
the date hereof and from time to time hereafter, and any successor statute.

“Internally Generated Cash” means, with respect to any period, any cash of
Borrower and its Subsidiaries generated during such period, excluding Net Asset
Sale Proceeds, Net Insurance/Condemnation Proceeds and any cash that is received
from an incurrence of Indebtedness, an issuance of Equity Interests or a capital
contribution.

“Investment” means (i) any direct or indirect purchase or other acquisition by
Borrower or any of its Subsidiaries of, or of a beneficial interest in, any of
the Securities of any other Person (other than a Guarantor Subsidiary); (ii) any
direct or indirect purchase or other acquisition for value, by any Subsidiary of
Borrower from any Person (other than Borrower or any other Credit Party), of any
Equity Interests of such Person; (iii) any direct or indirect loan, advance
(other than advances to employees for moving, entertainment and travel expenses,
drawing accounts and similar expenditures in the ordinary course of business) or
capital contributions by Borrower or any of its Subsidiaries to any other Person
(other than Borrower or any other Credit Party), including all indebtedness and
accounts receivable from that other Person that are not current assets or did
not arise from sales to that other Person in the ordinary course of business and
(iv) all investments consisting of any exchange traded or over the counter
derivative transaction, including any Interest Rate Agreement and Currency
Agreement, whether entered into for hedging or speculative purposes. The amount
of any Investment shall be the original cost of such Investment plus the cost of
all additions thereto, without any adjustments for increases or decreases in
value, or write ups, write downs or write offs with respect to such Investment,
less an amount equal to any returns of capital or sale proceeds actually
received in cash in respect of any such Investment (which amount shall not
exceed the amount of such Investment valued at cost at the time such Investment
was made).

“Issuance Notice” means an Issuance Notice in form and substance reasonably
satisfactory to Issuing Bank.

 

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“Issuing Bank” means JPMorgan Chase Bank, N.A., including its affiliates and
branches, in its capacity as Issuing Bank hereunder, together with its permitted
successors and assigns in such capacity.

“Joinder Agreement” means an agreement substantially in the Form of Exhibit K.

“Joint Venture” means a joint venture, partnership or other similar arrangement,
whether in corporate, partnership or other legal form and, for the avoidance of
doubt, includes a Specified Joint Venture; provided, in no event shall any
corporate Subsidiary of any Person be considered to be a Joint Venture to which
such Person is a party.

“Judgment Conversion Date” as defined in Section 10.24(a).

“Judgment Currency” as defined in Section 10.24(a).

“Lender” means each financial institution listed on the signature pages hereto
as a Lender, and any other Person that becomes a party hereto pursuant to an
Assignment Agreement or a Joinder Agreement.

“Lender Counterparty” means, at any time, each Person that is a counterparty to
a Hedge Agreement or Cash Management Agreement, provided that such Person is a
Lender, an Agent, or an Affiliate of a Lender or Agent at such time or was a
Lender, an Agent or an Affiliate of a Lender or Agent, at the time such Hedge
Agreement or Cash Management Agreement was entered into or, in the case of any
such Hedge Agreement or Cash Management Agreement in effect as of the Third
Restatement Date, Second Restatement Date, First Restatement Date, Original
Closing Date or any time prior thereto, is a Lender, an Agent or an Affiliate of
a Lender or an Agent as of the Third Restatement Date, Second Restatement Date,
First Restatement Date or Original Closing Date.

“Letter of Credit” means a commercial or standby letter of credit issued or to
be issued by Issuing Bank pursuant to this Agreement.

“Letter of Credit Sublimit” means, as of any date of determination, the lesser
of (i) $25,000,000 and (ii) the aggregate unused amount of the Revolving
Commitments then in effect.

“Letter of Credit Usage” means, as of any date of determination, the sum of
(i) the maximum aggregate amount which is, or at any time thereafter may become,
available for drawing under all Letters of Credit then outstanding, and (ii) the
aggregate amount of all drawings under Letters of Credit honored by Issuing Bank
and not theretofore reimbursed by or on behalf of Borrower.

“Leverage Ratio” means the ratio as of the last day of any Fiscal Quarter of
(i) Consolidated Total Debt as of such day to (ii) Consolidated Adjusted EBITDA
for the four Fiscal Quarter period ending on such date.

“Lien” means (i) any lien, mortgage, hypothecation, deed of trust, pledge,
assignment, security interest, charge, deposit arrangement or encumbrance of any
kind (including any agreement to give any of the foregoing, any conditional sale
or other title retention agreement, and any lease or license in the nature
thereof) and any option, trust or other preferential arrangement having the
practical effect of any of the foregoing and (ii) in the case of Securities, any
purchase option, call or similar right of a third party with respect to such
Securities.

“Loan” means any of a Tranche A Term Loan, a Tranche B Term Loan, a New Term
Loan, a Revolving Loan and a Swing Line Loan.

 

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“Luxembourg Guarantor” means Biovail International, S.à r.l., a private limited
liability company (société à responsabilité limitée) organized under the laws of
Luxembourg, and each other Guarantor that is organized under the laws of
Luxembourg.

“Luxembourg Security Documents” means each of the documents set forth on
Schedule 5.10(c), dated as of the Second Restatement Date, as each of such
documents may be amended, restated, supplemented or otherwise modified from time
to time and additional analogous agreements as may be entered into from time to
time in accordance with Section 5.10 and as required by the Collateral
Documents.

“Margin Stock” as defined in Regulation U.

“Material Adverse Effect” means a material adverse effect on (i) the business,
operations, properties, assets or condition (financial or otherwise) of Borrower
and its Subsidiaries taken as a whole, (ii) the ability of any Credit Party to
fully and timely pay its Obligations when due or (iii) the rights, remedies and
benefits available to, or conferred upon, any Agent and any Lender or any
Secured Party under any Credit Document.

“Material Real Estate Asset” means any fee owned Real Estate Asset having a fair
market value in excess of $20,000,000; provided that in no event shall Material
Real Estate Assets include the Real Estate Assets of Borrower and its
Subsidiaries owned as of the Original Closing Date and located in (a) Carolina,
Puerto Rico and (b) Christ Church, Barbados.

“Maximum Amount” as defined in 7.13(a).

“Merger Agreement” means the Agreement and Plan of Merger, dated as of June 20,
2010, among Borrower, VPI, Biovail Americas Corp. and Beach Merger Corp.,
together with all exhibits, schedules, documents, agreements, and instruments
executed and delivered in connection therewith, as the same may be amended or
modified in accordance with the terms thereof.

“Moody’s” means Moody’s Investors Service, Inc.

“Mortgage” means a mortgage, deed of trust, debenture or similar document
creating a Lien on real property, in form and substance reasonably satisfactory
to the Collateral Agent, as it may be amended, restated, supplemented or
otherwise modified from time to time.

“Multiemployer Plan” means any Employee Benefit Plan which is a “multiemployer
plan” as defined in Section 3(37) of ERISA.

“Narrative Report” means, with respect to the financial statements for which
such narrative report is required, a narrative report describing the operations
of Borrower and its Subsidiaries that complies with the applicable requirements
under the Exchange Act for a “Management Discussion and Analysis” for the
applicable Fiscal Quarter or Fiscal Year and for the period from the beginning
of the then current Fiscal Year to the end of such period to which such
financial statements relate.

“Net Asset Sale Proceeds” means, with respect to any Asset Sale, an amount equal
to: (i) Cash payments (including any Cash received by way of deferred payment
pursuant to, or by monetization of, a note receivable or otherwise (including by
way of milestone payment), but only as and when so received) received by
Borrower or any of its Subsidiaries from such Asset Sale, minus (ii) any
reasonable fees and out-of-pocket expenses and bona fide direct costs incurred
in connection with such Asset Sale, including (a) income or gains taxes payable
by the seller as a result of any gain recognized in connection with such

 

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Asset Sale, (b) payment of the outstanding principal amount of, premium or
penalty, if any, and interest on any Indebtedness (other than the Loans) that is
secured by a Lien on the stock or assets in question and that is required to be
repaid under the terms thereof as a result of such Asset Sale, (c) a reasonable
reserve for any indemnification payments (fixed or contingent) attributable to
seller’s indemnities, contributions, cost sharings and representations and
warranties to purchaser or any advisor in respect of such Asset Sale undertaken
by Borrower or any of its Subsidiaries in connection with such Asset Sale and
(d) fees paid for legal and financial advisory services in connection with such
Asset Sale; provided that proceeds from Asset Sales permitted under clause
(e) of Section 6.8, shall not be included in the calculation of proceeds for
purposes of this definition except as expressly set forth in such clause.

“Net Insurance/Condemnation Proceeds” means an amount equal to: (i) any Cash
payments or proceeds received by Borrower or any of its Subsidiaries (a) under
any property damage or casualty insurance policies in respect of any covered
loss thereunder or (b) as a result of the taking of any assets of Borrower or
any of its Subsidiaries by any Person pursuant to the power of eminent domain,
condemnation or otherwise, or pursuant to a sale of any such assets to a
purchaser with such power under threat of such a taking, minus (ii) (a) any
actual and reasonable costs incurred by Borrower or any of its Subsidiaries in
connection with the adjustment or settlement of any claims of Borrower or such
Subsidiary in respect thereof, and (b) any reasonable fees and out-of-pocket
expenses and bona fide direct costs incurred in connection with any sale of such
assets as referred to in clause (i)(b) of this definition, including income
taxes payable as a result of any gain recognized in connection therewith.

“Net Mark-to-Market Exposure” of a Person means, as of any date of
determination, the excess (if any) of all unrealized losses over all unrealized
profits of such Person arising from Hedge Agreements. As used in this
definition, “unrealized losses” means the fair market value of the cost to such
Person of replacing such Hedge Agreement as of the date of determination
(assuming the Hedge Agreement were to be terminated as of that date), and
“unrealized profits” means the fair market value of the gain to such Person of
replacing such Hedge Agreement as of the date of determination (assuming such
Hedge Agreement were to be terminated as of that date).

“New Revolving Loan Lender” as defined in Section 2.25.

“New Revolving Loan Commitments” as defined in Section 2.25.

“New Revolving Loan Exposure” means, with respect to any Lender, as of any date
of determination, the outstanding principal amount of the New Revolving Loans of
such Lender.

“New Revolving Loan Maturity Date” means the date on which New Revolving Loans
of a Series shall become due and payable in full hereunder, as specified in the
applicable Joinder Agreement, including by acceleration or otherwise.

“New Revolving Loans” as defined in Section 2.25.

“New Term Loan Commitments” as defined in Section 2.25.

“New Term Loan Exposure” means, with respect to any Lender, as of any date of
determination, the outstanding principal amount of the New Term Loans of such
Lender.

“New Term Loan Lender” as defined in Section 2.25.

 

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“New Term Loan Maturity Date” means the date on which New Term Loans of a Series
shall become due and payable in full hereunder, as specified in the applicable
Joinder Agreement, including by acceleration or otherwise.

“New Term Loans” as defined in Section 2.25.

“Non-Consenting Lender” as defined in Section 2.23.

“Non-Public Information” means information which has not been disseminated in a
manner making it available to investors generally, within the meaning of
Regulation FD.

“Not Otherwise Applied” means, with reference to any amount of any transaction
or event, that such amount (i) was not required to be applied to prepay the
Loans pursuant to Section 2.14, and (ii) was not previously applied in
determining the permissibility of a transaction under the Credit Documents where
such permissibility was (or may have been) contingent on the receipt or
availability of such amount.

“Note” means a Tranche A Term Loan Note, a Tranche B Term Loan Note, a Revolving
Loan Note or a Swing Line Note.

“Notice” means a Funding Notice, an Issuance Notice, or a
Conversion/Continuation Notice.

“Obligation Currency” as defined in Section 10.24(a).

“Obligations” means all obligations of every nature of each Credit Party (and,
with respect to any obligations in respect of Hedge Agreements and Cash
Management Agreements, any Subsidiary of a Credit Party) owing to any Secured
Party (including former Agents) (but limited, in the case of obligations in
respect of Hedge Agreement and Cash Management Agreements, to those obligations
owing to Lender Counterparties) under any Credit Document, Hedge Agreement or
Cash Management Agreement whether for principal, interest (including interest
which, but for the filing of a petition in bankruptcy with respect to such
Credit Party, would have accrued on any Obligation, whether or not a claim is
allowed against such Credit Party (or, with respect to any obligations in
respect of Hedge Agreements and Cash Management Agreements, any Subsidiary of a
Credit Party) for such interest in the related bankruptcy proceeding),
reimbursement of amounts drawn under Letters of Credit, payments for early
termination of Hedge Agreements or Cash Management Agreements, fees, expenses,
indemnification or otherwise.

“Obligee Guarantor” as defined in Section 7.7.

“OFAC” as defined in Section 4.25.

“Organizational Documents” means (i) with respect to any corporation or company
or society with restricted liability, its certificate, memorandum or articles of
incorporation, organization, association or amalgamation or other constituting
documents, in each case, as amended, and its by laws, as amended, (ii) with
respect to any limited partnership, its certificate or declaration of limited
partnership, as amended, and its partnership agreement, as amended, (iii) with
respect to any general partnership, its partnership agreement, as amended, and
(iv) with respect to any limited liability company, its articles of
organization, as amended, and its operating agreement, as amended. In the event
any term or condition of this Agreement or any other Credit Document requires
any Organizational Document to be certified by a Governmental Authority, the
reference to any such “Organizational Document” shall only be to a document of a
type customarily certified by such Governmental Authority.

 

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“Original Closing Date” means June 29, 2011.

“Original Credit Agreement” as defined in the recitals.

“Orthodermatologics Acquisition” means the acquisition of certain assets and
rights, and assumption of certain liabilities, relating to the Ortho
Dermatologics Division of Janssen Pharmaceuticals, Inc., a Subsidiary of
Johnson & Johnson, by certain wholly-owned Subsidiaries of Borrower, pursuant to
that certain asset purchase agreement, dated as of July 15, 2011, by and among
Janssen Pharmaceuticals, Inc., Valeant Pharmaceuticals North America LLC,
Valeant International (Barbados) SRL and, solely for the purposes set forth
therein, Valeant Pharmaceuticals International, Inc., including all schedules,
annexes and exhibits attached thereto and all material documents related to the
consummation of the transactions contemplated thereby, as amended, modified and
supplemented.

“Other Taxes” as defined in Section 2.20(e).

“PATRIOT Act” means the Uniting and Strengthening America by providing
Appropriate Tools Required to Intercept and Obstruct Terrorism Act (Title III of
Pub. L. 107-56 (signed into law October 26, 2001).

“PBGC” means the Pension Benefit Guaranty Corporation or any successor thereto.

“PCTFA” as defined in Section 4.23.

“Pension Plan” means, in respect of any Credit Party, any Employee Benefit Plan,
other than a Multiemployer Plan, which is subject to Section 412 of the Internal
Revenue Code or Section 302 of ERISA.

“Permitted Acquisition” means any acquisition by Borrower or any of its wholly
owned Subsidiaries, whether by purchase, merger, amalgamation or otherwise, of
all or substantially all of the assets of, all of the Equity Interests of, or a
business line or unit or a division of, or a product or a product candidate of,
any Person; provided that:

(i) immediately prior to, and after giving effect thereto, no Default or Event
of Default shall have occurred and be continuing or would result therefrom;

(ii) all transactions in connection therewith shall be consummated, in all
material respects, in accordance with all Applicable Law and in conformity with
all applicable Governmental Authorizations;

(iii) in the case of the acquisition of Equity Interests, (a) all of the Equity
Interests (except for any such Securities in the nature of directors’ qualifying
shares required pursuant to Applicable Law) acquired or otherwise issued by such
Person or any newly formed Subsidiary of Borrower in connection with such
acquisition shall be owned 100% by Borrower or a Guarantor Subsidiary, and
(b) Borrower shall have taken, or shall promptly cause to be taken and, in any
event, shall cause to be taken within 45 days of such acquisition (or such
longer period as shall be reasonably acceptable to the Administrative Agent),
each of the applicable actions set forth in Section 5.10 (including causing such
Subsidiary, other than an Excluded Subsidiary, to become a Guarantor and subject
to the Collateral Documents), it being understood that the acquisition of Equity
Interests shall constitute a Permitted Acquisition during such period if it
satisfies all conditions of the definition of Permitted Acquisition other than
those set forth in this clause (iii)(b);

 

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(iv) Borrower and its Subsidiaries shall be in compliance with the financial
covenants set forth in Section 6.7 on a Pro Forma Basis after giving effect to
such acquisition as of the last day of the Fiscal Quarter most recently ended
for which financial statements are required to have been delivered pursuant to
Section 5.1(a) or 5.1(b), as applicable (as determined in accordance with
Section 1.5);

(v) in the case of an acquisition involving aggregate consideration in excess of
$50,000,000, Borrower shall have delivered to Administrative Agent at least two
(2) Business Days prior to the consummation of such proposed acquisition, (i) a
Compliance Certificate evidencing compliance with Section 6.7 as required under
clause (iv) above and (ii), all other relevant material financial information
with respect to such acquired assets, including the aggregate consideration for
such acquisition and any other information required to demonstrate compliance
with Section 6.7; and

(vi) any Person or assets or division as acquired in accordance herewith shall
be in same business or lines of business in which Borrower and/or its
Subsidiaries are engaged as of the Third Restatement Date or similar or related
or ancillary businesses.

“Permitted Interim Investment” means any acquisition by Borrower or any of its
wholly owned Subsidiaries of any Equity Interests of any Person, which
acquisition has been designated by Borrower in writing to the Administrative
Agent as a Permitted Interim Investment; provided that:

(i) such acquisition complies with each of the conditions set forth in clauses
(i), (ii), (iv), (v) and (vi) of the definition of Permitted Acquisition;

(ii) at the time of any such acquisition of Equity Interests, the Administrative
Agent shall have received a certificate from the chief executive officer or the
chief financial officer (or the equivalent thereof) of Borrower certifying that
such acquisition is pursuant to a transaction or series of transactions in which
Borrower or a wholly owned Subsidiary of Borrower intends to acquire all
remaining Equity Interests of such Person such that it becomes a wholly owned
Subsidiary of Borrower;

(iii) within 180 days following the initial acquisition of Equity Interests of
such Person, Borrower or a wholly owned Subsidiary of Borrower shall have either
(x) commenced and have outstanding a tender offer for all remaining Equity
Interests of such Person or (y) entered into and have in effect a binding merger
or similar agreement with such Person (it being understood and agreed that the
satisfaction of the condition contained in this clause (iii) shall be satisfied
only if and for so long as any such tender offer remains open and/or such merger
or similar agreement remains in effect);

(iv) except as otherwise agreed by the Administrative Agent as a result of any
applicable rules and regulations of the Board of Governors, all Equity Interests
of such Person owned by Borrower or any of its Subsidiaries shall be pledged, or
credited to a securities account at the Collateral Agent, as collateral for the
Obligations; and

(v) upon the acquisition of the remaining Equity Interests of such Person such
that such Person thereafter becomes a wholly owned Subsidiary of Borrower or any
of its Subsidiaries the aggregate Investment represented by the acquisition of
Equity Interests in such Person shall either (x) comply with and satisfy the
requirements of clause (iii) of the definition of Permitted Acquisition or
(y) be made pursuant to and in compliance with Section 6.6(d)(ii) or 6.6(i).

 

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“Permitted Liens” means each of the Liens permitted pursuant to Section 6.2.

“Permitted Secured Notes” means debt securities of any Credit Party that are
secured by a Lien ranking pari passu with or junior to the Liens securing the
Obligations; provided that (a) the terms of such debt securities do not provide
for any scheduled repayment, mandatory redemption or sinking fund obligations
prior to the latest Term Loan Maturity Date (other than customary offers to
repurchase upon a change of control, asset sale or event of loss and customary
acceleration rights after an event of default), (b) the covenants, events of
default, guarantees, collateral and other terms of which (other than interest
rate and redemption premiums), taken as a whole, are not more restrictive to
Borrower or any of its Subsidiaries than those in this Agreement, (c) Borrower
will cause the collateral agent or representatives for the holders of Permitted
Secured Notes to enter into an intercreditor agreement with Collateral Agent in
form and substance usual and customary for transactions of this type and
otherwise satisfactory to Collateral Agent in its sole discretion, (d) at the
time that any such Permitted Secured Notes are issued (and after giving effect
thereto) no Default or Event of Default shall exist, be continuing or result
therefrom, (e) on a Pro Forma Basis after giving effect to the incurrence of
such Permitted Secured Notes (and the use of proceeds thereof), Borrower shall
be in compliance with the covenants set forth in Section 6.7 as of the last day
of the most recently ended Fiscal Quarter for which financial statements were
required to have been delivered pursuant to Section 5.1(a) or (b), as
applicable, in each case, as if such Permitted Secured Notes had been
outstanding on the last day of such Fiscal Quarter and (f) no Subsidiary of
Borrower (other than a Guarantor) shall be an obligor and no Permitted Secured
Notes shall be secured by any collateral other than the Collateral.

“Person” means and includes natural persons, corporations, limited partnerships,
general partnerships, limited liability companies, unlimited liability
companies, limited liability partnerships, joint stock companies, Joint
Ventures, associations, companies, trusts, banks, trust companies, land trusts,
business trusts or other organizations, whether or not legal entities, and
Governmental Authorities.

“Platform” as defined in Section 5.1(n).

“Post Merger Special Dividend” as defined in the Merger Agreement.

“PPSA” means the Personal Property Security Act (Ontario); provided, however, if
the validity, attachment, perfection (or opposability), effect of perfection or
of non-perfection or priority of Collateral Agent’s security interest in any
Collateral are governed by the personal property security laws or laws relating
to personal or movable property of any jurisdiction other than Ontario, PPSA
shall also include those personal property security laws or laws relating to
movable property in such other jurisdiction for the purpose of the provisions
hereof relating to such validity, attachment, perfection (or opposability),
effect of perfection or of non-perfection or priority and for the definitions
related to such provisions.

“Pre-Merger Special Dividend” as defined in the Merger Agreement.

“Prescription Drug Business” means the business or businesses comprising
Borrower’s and/or its Subsidiaries’ businesses in Europe and Latin America as of
the Third Restatement Date.

“Prime Rate” means the rate of interest quoted in the print edition of The Wall
Street Journal, Money Rates Section as the Prime Rate (currently defined as the
base rate on corporate loans posted by at least 75% of the nation’s thirty
(30) largest banks), as in effect from time to time. The Prime Rate is a
reference rate and does not necessarily represent the lowest or best rate
actually charged to any customer. Any Agent or any other Lender may otherwise
make commercial loans or other loans at rates of interest at, above or below the
Prime Rate.

 

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“Principal Office” means, for each of Administrative Agent, Swing Line Lender
and Issuing Bank, such Person’s “Principal Office” as set forth on Appendix B,
or such other office or office of a third party or sub-agent, as appropriate, as
such Person may from time to time designate in writing to Borrower,
Administrative Agent and each Lender.

“Projections” as defined in Section 4.8.

“Pro Forma Basis” means, with respect to the calculation of the covenants
contained in Section 6.7 or for purposes of determining the Interest Coverage
Ratio, Leverage Ratio or Secured Leverage Ratio as of any date, that such
calculation shall give pro forma effect to all Permitted Acquisitions,
Acquisitions, Investments that result in a Person becoming a Subsidiary of
Borrower, and all sales, transfers or other dispositions of any material assets
outside the ordinary course of business that have occurred during (or, if such
calculation is being made for the purpose of determining whether any proposed
acquisition will constitute (or will be permitted as) a Permitted Acquisition,
or any Indebtedness (including New Term Loans) or Liens may be incurred, since
the beginning of) the four consecutive Fiscal Quarter period most-recently ended
on or prior to such date as if they occurred on the first day of such four
consecutive Fiscal Quarter period (including expected cost savings (without
duplication of actual cost savings) to the extent (a) such cost savings would be
permitted to be reflected in pro forma financial information complying with the
requirements of GAAP and Article 11 of Regulation S-X under the Securities Act
as interpreted by the Staff of the Securities and Exchange Commission, and as
certified by a financial officer of Borrower or (b) Borrower in good faith
believes that such cost savings will be realized within one year after the
applicable Permitted Acquisition, Acquisition, Investment or sale, transfer or
other disposition of material assets outside the ordinary course of business and
all steps necessary for the realization of such cost savings have been taken as
certified by a financial officer of Borrower. Notwithstanding the foregoing, for
all purposes under this Agreement, other than as permitted by clause (k) of the
definition of “Consolidated Adjusted EBITDA,” no cost savings or synergies
relating to the 2010 Transactions shall be included for purposes of calculating
the covenants (including New Term Loans) contained in Sections 6.1 and 6.7 or
for purposes of determining the Interest Coverage Ratio, Leverage Ratio or
Secured Leverage Ratio until actually realized.

“Pro Rata Share” means (i) with respect to all payments, computations and other
matters relating to the Tranche A Term Loan of any Lender, the percentage
obtained by dividing (a) the Tranche A Term Loan Exposure of that Lender by
(b) the aggregate Tranche A Term Loan Exposure of all Lenders; (ii) with respect
to all payments, computations and other matters relating to the Tranche B Term
Loan Commitment or Tranche B Term Loan of any Lender, the percentage obtained by
dividing (a) the Tranche B Term Loan Exposure of that Lender by (b) the
aggregate Tranche B Term Loan Exposure of all Lenders; (iii) with respect to all
payments, computations and other matters relating to the Revolving Commitment or
Revolving Loans of any Lender or any Letters of Credit issued or participations
purchased therein by any Lender or any participations in any Swing Line Loans
purchased by any Lender, the percentage obtained by dividing (a) the Revolving
Exposure of that Lender by (b) the aggregate Revolving Exposure of all Lenders
(exclusive of the Revolving Exposure of the Swing Line Lender and the Issuing
Bank in their capacities as such) and (iv) with respect to all payments,
computations, and other matters relating to New Term Loan Commitments or New
Term Loans of a particular Series, the percentage obtained by dividing (a) the
New Term Loan Exposure of that Lender with respect to that Series by (b) the
aggregate New Term Loan Exposure of all Lenders with respect to that Series. For
all other purposes with respect to each Lender, “Pro Rata Share” means the
percentage obtained by dividing (A) an amount equal to the sum of the Tranche A
Term Loan Exposure, the Tranche B Term Loan Exposure, the Revolving Exposure and
the New Term Loan Exposure of that Lender, by (B) an amount equal to the sum of
the aggregate Tranche A Term Loan Exposure, the Tranche B Term Loan Exposure,
the aggregate Revolving Exposure and the aggregate New Term Loan Exposure of all
Lenders (exclusive of the Revolving Exposure of the Swing Line Lender and the
Issuing Bank in their capacities as such).

 

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“Public Lenders” means Lenders that do not wish to receive material non-public
information with respect to Borrower, its Subsidiaries or their respective
Securities.

“Quebec Security Documents” means each of the documents set forth on
Schedule 5.10(b), as each such document may be amended, restated, supplemented
or otherwise modified from time to time and additional analogous agreements as
may be entered into from time to time in accordance with Section 5.10 and as
required by the Collateral Documents.

“Real Estate Asset” means, at any time of determination, any interest (fee,
leasehold or otherwise) then owned by any Credit Party in any real property.

“Refinancing” as defined in the recitals.

“Refinancing Indebtedness” as defined in Section 6.1(r).

“Refunded Swing Line Loans” as defined in Section 2.3(b)(iv).

“Register” as defined in Section 2.7(b).

“Regulation D” means Regulation D of the Board of Governors, as in effect from
time to time.

“Regulation FD” means Regulation FD as promulgated by the U.S. Securities and
Exchange Commission under the Securities Act and Exchange Act as in effect from
time to time.

“Regulation T” means Regulation T of the Board of Governors, as in effect from
time to time and all official rulings and interpretations thereunder or thereof.

“Regulation U” means Regulation U of the Board of Governors, as in effect from
time to time and all official rulings and interpretations thereunder or thereof.

“Regulation X” means Regulation X of the Board of Governors, as in effect from
time to time and all official rulings and interpretations thereunder or thereof.

“Reimbursement Date” as defined in Section 2.4(d).

“Related Fund” means, with respect to any Lender that is an investment fund, any
other investment fund that invests in commercial loans and that is managed or
advised by the same investment advisor as such Lender or by an Affiliate of such
investment advisor.

“Release” means any release, spill, emission, emanation, leaking, pumping,
pouring, injection, spraying, escaping, deposit, disposal, discharge, dispersal,
dumping, abandonment, placing, exhausting, 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.

“Replacement Lender” as defined in Section 2.23.

“Repricing Transaction” means the prepayment or refinancing of all or a portion
of the Tranche B Term Loans with the incurrence by any Credit Party of any
long-term bank debt financing having an effective interest cost or weighted
average yield (excluding any arrangement or commitment fees in connection
therewith) that is less than the effective interest cost for or weighted average
yield of the Tranche B Term Loans, including without limitation, as may be
effected through any amendment to this Agreement relating to the effective
interest cost for, or weighted average yield of, the Tranche B Term Loans.

 

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“Required Prepayment Date” as defined in Section 2.15(d).

“Requisite Lenders” means one or more Lenders having or holding Tranche A Term
Loan Exposure, Tranche B Term Loan Exposure, New Term Loan Exposure and/or
Revolving Exposure and representing more than 50% of the sum of (i) the
aggregate Tranche A Term Loan Exposure of all Lenders, (ii) the aggregate
Tranche B Term Loan Exposure of all Lenders, (iii) the aggregate Revolving
Exposure of all Lenders and (iv) the aggregate New Term Loan Exposure of all
Lenders.

“Responsible Officer” means, as applied to any Person, any individual holding
the position of chairman of the board (if an officer), chief executive officer,
president, vice president (or the equivalent thereof), chief financial officer
(or the equivalent thereof) or treasurer of such Person.

“Restricted Junior Payment” means (i) any dividend or other distribution, direct
or indirect, on account of any shares of any class of stock of Borrower or any
of its Subsidiaries (or any direct or indirect parent of Borrower or any of its
Subsidiaries) now or hereafter outstanding, except a dividend payable solely in
shares of that class of stock (or, in the case of preferred stock, in shares of
that class of stock or in common stock) to the holders of that class; (ii) any
redemption, retirement, sinking fund or similar payment, purchase or other
acquisition for value, direct or indirect, of any shares of any class of stock
of Borrower or any of its Subsidiaries (or any direct or indirect parent
thereof) now or hereafter outstanding; (iii) any payment made to retire, or to
obtain the surrender of, any outstanding warrants, options or other rights to
acquire shares of any class of stock of Borrower or any of its Subsidiaries (or
any direct or indirect parent of Borrower) now or hereafter outstanding; and
(iv) any payment or prepayment of principal of, premium, if any, or interest on,
or redemption, purchase, retirement, defeasance (including in substance or legal
defeasance), sinking fund or similar payment with respect to, any Subordinated
Indebtedness owed to a Person that is not Borrower or a Guarantor (other than
(x) regularly scheduled payments of interest and principal in respect of any
Subordinated Indebtedness and (y) the conversion of convertible securities to
common stock of Borrower, in each case in accordance with the terms of, and only
to the extent required by, and subject to the subordination provisions contained
in, the indenture or other agreement pursuant to which such Subordinated
Indebtedness was issued); provided, that in no event shall any payment or other
distribution (including, without limitation, upon conversion to common stock of
Borrower) in respect of Borrower Convertible Notes or the VPI Convertible Notes
and the issuer written call option transactions relating thereto be deemed a
Restricted Junior Payment.

“Restricted Obligations” as defined in Section 7.13(a).

“Revolving Commitment” means the commitment of a Lender to make or otherwise
fund any Revolving Loan and to acquire participations in Letters of Credit and
Swing Line Loans hereunder and “Revolving Commitments” means such commitments of
all Lenders in the aggregate. The amount of each Lender’s Revolving Commitment,
if any, is set forth on Appendix A-1 or in the applicable Assignment Agreement,
subject to any adjustment or reduction pursuant to the terms and conditions
hereof. The aggregate amount of the Revolving Commitments as of the Third
Restatement Date is $275,000,000.

“Revolving Commitment Period” means the period from and including the Second
Restatement Date to but excluding the Revolving Commitment Termination Date.

“Revolving Commitment Termination Date” means the earliest to occur of
(i) April 20, 2016, (ii) the date the Revolving Commitments are permanently
reduced to zero pursuant to Section 2.13(b) or 2.14 and (iii) the date of the
termination of the Revolving Commitments pursuant to Section 8.1.

 

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“Revolving Exposure” means, with respect to any Lender as of any date of
determination, (i) prior to the termination of the Revolving Commitments, that
Lender’s Revolving Commitment as of such date; and (ii) after the termination of
the Revolving Commitments, the sum of (a) the aggregate outstanding principal
amount of the Revolving Loans of that Lender, (b) in the case of Issuing Bank,
the aggregate Letter of Credit Usage in respect of all Letters of Credit issued
by that Lender (net of any participations by Lenders in such Letters of Credit),
(c) the aggregate amount of all participations by that Lender in any outstanding
Letters of Credit or any unreimbursed drawing under any Letter of Credit, (d) in
the case of Swing Line Lender, the aggregate outstanding principal amount of all
Swing Line Loans (net of any participations therein by other Lenders), and
(e) the aggregate amount of all participations therein by that Lender in any
outstanding Swing Line Loans, in each case as of such date.

“Revolving Loan” means a Loan denominated in Dollars made by a Lender to
Borrower pursuant to Section 2.2(a), as such Loan may be increased, if
applicable, by any New Revolving Loans Commitments, in accordance with
Section 2.25.

“Revolving Loan Note” means a promissory note in the form of Exhibit B-1, as it
may be amended, restated, supplemented or otherwise modified from time to time.

“S&P” means Standard & Poor’s, a Division of The McGraw Hill Companies, Inc.

“Sanitas Acquisition” means the acquisition of all of the outstanding shares of
AB Sanitas and assumption of certain liabilities of AB Sanitas, to be
implemented by acquisition of a controlling interest in AB Sanitas followed by a
mandatory tender offer to acquire the remaining shares, pursuant to that certain
Share Sale and Purchase Agreement, dated as of May 23, 2011, by and between
certain shareholders of AB Sanitas, AB Sanitas and Borrower, including all
schedules, annexes and exhibits attached thereto and all material documents
related to the consummation of the transactions contemplated thereby, as
amended, modified and supplemented, together with subsequent actions to obtain
any shares that remain outstanding thereafter.

“SEC” means the U.S. Securities and Exchange Commission.

“Second Amended and Restated Credit Agreement” as defined in the recitals.

“Second Amended and Restated Pledge and Security Agreement” means the Second
Amended and Restated Pledge and Security Agreement, dated as of the Third
Restatement Date, among each of the Grantors party thereto and the Collateral
Agent, substantially in the form of Exhibit I-1, as it may be amended, restated,
supplemented or otherwise modified from time to time.

“Second Amendment and Restatement Joinder Date” means December 19, 2011.

“Second Restatement Date” means October 20, 2011.

“Secured Leverage Ratio” means, as of any date of determination, the ratio, on a
Pro Forma Basis, of (a) Consolidated Secured Indebtedness as of such date to
(b) Consolidated Adjusted EBITDA for the four Fiscal Quarter period ending on
such date.

“Secured Parties” has the meaning assigned to that term in the Second Amended
and Restated Pledge and Security Agreement, the Canadian Pledge and Security
Agreement, the Quebec Security Documents, the Barbados Security Documents, the
Luxembourg Security Documents and the Swiss Security Documents, in each case as
applicable.

 

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“Securities” means any stock, shares, partnership interests, voting trust
certificates, certificates of interest or participation in any profit sharing
agreement or arrangement, options, warrants, bonds, debentures, notes, or other
evidences of indebtedness, secured or unsecured, convertible, subordinated or
otherwise, or in general any instruments commonly known as “securities” or any
certificates of interest, shares or participations in temporary or interim
certificates for the purchase or acquisition of, or any right to subscribe to,
purchase or acquire, any of the foregoing.

“Securities Act” means the Securities Act of 1933, as amended from time to time,
and any successor statute.

“Senior Notes” means, collectively, the 6.500% Senior Notes due 2016 of VPI, the
6.750% Senior Notes due 2017 of VPI, the 6.750% Senior Notes due 2021 of VPI,
the 6.875% Senior Notes due 2018 of VPI, the 7.000% Senior Notes due 2020 of VPI
and the 7.250% Senior Notes due 2022 of VPI.

“Series” as defined in Section 2.25.

“Series A New Term Loan” means a Series A New Term Loan made by a Lender to
Borrower pursuant to the Joinder Agreement dated December 19, 2011.

“Solvency Certificate” means a Solvency Certificate of the chief financial
officer (or the equivalent thereof) of Borrower substantially in the form of
Exhibit F-2.

“Solvent” means, with respect to any Credit Party, that as of the date of
determination (after giving effect to all rights of reimbursement, contribution
and subrogation under Applicable Law and the Credit Documents), if subject to
the Insolvency Laws of (a) any jurisdiction other than Canada or any political
subdivision thereof, (i) the sum of such Credit Party’s debt (including
contingent liabilities) does not exceed the present fair saleable value of such
Credit Party’s present assets; (ii) such Credit Party’s capital is not
unreasonably small in relation to its business as contemplated on the Third
Restatement Date and reflected in the Projections or with respect to any
transaction contemplated to be undertaken after the Third Restatement Date; and
(iii) such Credit Party has not incurred and does not intend to incur, or
believe (nor should it reasonably believe) that it will incur, debts beyond its
ability to pay such debts as they become due (whether at maturity or otherwise);
and (b) Canada or any political subdivision thereof, (i) the property of such
Credit Party is sufficient, if disposed of at a fairly conducted sale under
legal process, to enable payment of all its obligations, due and accruing due,
(ii) the property of such Credit Party is, at a fair valuation, greater than the
total amount of liabilities, including contingent liabilities, of such Credit
Party; and (iii) such Credit Party has not ceased paying its current obligations
in the ordinary course of business as they generally become due. For purposes of
this definition, the amount of any contingent liability at any time shall be
computed as the amount that, in light of all of the facts and circumstances
existing at such time, represents the amount that can reasonably be expected to
become an actual or matured liability (irrespective of whether such contingent
liabilities meet the criteria for accrual under Statement of Financial
Accounting Standard No. 5 or any other analogous criteria in any jurisdiction).

“Specified Asset Disposition” means the sale, transfer or other disposition of
Retigabine (and for the avoidance of doubt, Intellectual Property related
thereto) in accordance with Section 6.8.

“Specified Joint Venture,” with respect to any Person, means a Joint Venture
(a) in which such Person, directly or indirectly (i) owns more than 50% of the
Equity Interests (or owns at least 50% of the Equity Interests if such Joint
Venture is consolidated in the financial statements of such Person) and (ii)

 

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with respect to any Joint Venture in which such Person owns more than 50% of the
Equity Interests, exercises control (as defined in the definition of
“Affiliate”) and (b) that is designated in writing by the Board of Directors (or
equivalent governing body) of such Person as a “Specified Joint Venture” for
purposes of this Agreement.

“Spot Rate” means, on any day, for purposes of determining the Equivalent Amount
of any currency, the rate at which such currency may be exchanged into Dollars
at the time of determination on such day appearing on the Reuters Currencies
page for such currency. In the event that such rate does not appear on the
Reuters Currencies page, the Spot Rate shall be determined by reference to such
other publicly available service for displaying exchange rates as may be agreed
upon by Administrative Agent and Borrower or, in the absence of such an
agreement, the Spot Rate shall instead be the arithmetic average of the spot
rates of exchange of Administrative Agent in the market where its foreign
currency exchange operations in respect of such currency are then being
conducted, at or about such time as Administrative Agent shall elect after
determining that such rates shall be the basis for determining the Spot Rate on
such date for the purchase of Dollars for delivery two Business Days later;
provided that if at the time of any such determination, for any reason, no such
spot rate is being quoted, Administrative Agent may use any reasonable method it
deems appropriate to determine such rate, and such determination shall be
conclusive absent manifest error.

“Subordinated Indebtedness” means Indebtedness that, by its terms, is
subordinated in right and time of payment to the Obligations on terms reasonably
satisfactory to Administrative Agent and containing such terms and conditions
that are market terms and conditions on the date of issuance.

“Subsidiary” means, with respect to any Person, any corporation, company,
partnership, limited liability company, unlimited liability company,
association, society with restricted liability, Joint Venture or other business
entity of which more than 50% of the total voting power of shares of stock or
other ownership interests entitled (without regard to the occurrence of any
contingency) to vote in the election of the Person or Persons (whether
directors, managers, trustees or other Persons performing similar functions)
having the power to direct or cause the direction of the management and policies
thereof is at the time owned or controlled, directly or indirectly, legally or
beneficially, by such Person or one or more of the other Subsidiaries of such
Person or a combination thereof; provided, in no event shall any Specified Joint
Venture with respect to which such Person is party be considered to be a
Subsidiary.

“Swing Line Lender” means GSLP in its capacity as the lender of Swing Line Loans
hereunder, together with its permitted successors and assigns in such capacity.

“Swing Line Loan” means a Loan made by Swing Line Lender to Borrower pursuant to
Section 2.3.

“Swing Line Note” means a promissory note in the form of Exhibit B-2, as it may
be amended, restated, supplemented or otherwise modified from time to time.

“Swing Line Sublimit” means, as of any date of determination, the lesser of
(i) $25,000,000, and (ii) the aggregate unused amount of Revolving Commitments
then in effect.

“Swiss Federal Tax Administration” means the Swiss authority responsible for
levying Swiss Federal Withholding Tax.

“Swiss Federal Withholding Tax” means taxes imposed under the Swiss Withholding
Tax Act.

 

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“Swiss Withholding Tax Act” means the Swiss Federal Act on Withholding Tax of
13 October 1965 (Bundesgesetz über die Verrechnungssteuer), together with the
related ordinances, regulations and guidelines, all as amended and applicable
from time to time.

“Swiss Guarantor” means PharmaSwiss SA, in Zug, Switzerland
(CH-170.3.023.567-7), a company limited by shares (Aktiengesellschaft),
organized under the laws of Switzerland and any other Guarantor that is
organized under the laws of Switzerland.

“Swiss Security Documents” means each of the documents set forth on Schedule
5.10(d), dated as of the Second Restatement Date, as each of such documents may
be amended, restated, supplemented or otherwise modified from time to time and
additional analogous agreements as may be entered into from time to time in
accordance with Section 5.10 and as required by the Collateral Documents.

“Tax” means any present or future tax, levy, impost, duty, assessment, charge,
fee, deduction or withholding of any nature and whatever called, including any
interest, additions to tax or penalties thereto, by whomsoever, on whomsoever
and wherever imposed, levied, collected, withheld or assessed.

“Terminated Lender” as defined in Section 2.23.

“Term Loan” means a Tranche A Term Loan, a Tranche B Term Loan and/or a New Term
Loan, as the context requires.

“Term Loan Commitment” means the Tranche B Term Loan Commitment or the New Term
Loan Commitment of a Lender, and “Term Loan Commitments” means such commitments
of all Lenders.

“Term Loan Commitment Termination Date” means with respect to the Tranche B Term
Loans, the date which is the earlier to occur of (x) the date which is seven
years after the Third Restatement Date and (y) the first date on which all
undrawn Term Loan Commitments have been terminated or reduced to zero pursuant
to the terms hereof.

“Term Loan Maturity Date” means (i) with respect to the Tranche A Term Loans,
the Tranche A Term Loan Maturity Date and (ii) with respect to the Tranche B
Term Loans, the Tranche B Term Loan Maturity Date and (ii) with respect to the
New Term Loans of a Series, the New Term Loan Maturity Date of such Series of
New Term Loans.

“Third Restatement Date” means the date on which the conditions precedent set
forth in Section 3.1 have been satisfied or waived.

“Third Restatement Date Certificate” means a Third Restatement Date Certificate
of Borrower substantially in the form of Exhibit F-1.

“Total Utilization of Revolving Commitments” means, as at any date of
determination, the sum of (i) the aggregate principal amount of all outstanding
Revolving Loans (other than Revolving Loans made for the purpose of repaying any
Refunded Swing Line Loans or reimbursing Issuing Bank for any amount drawn under
any Letter of Credit, but not yet so applied), (ii) the aggregate principal
amount of all outstanding Swing Line Loans and (iii) the Letter of Credit Usage.

“Tranche A New Term Loans” means New Term Loans with required annual principal
repayments greater than 1% of the original principal amount of such New Term
Loans and otherwise with terms similar to the Tranche A Term Loans.

 

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“Tranche A Term Loan” means an Initial Draw Tranche A Term Loan, a Delayed Draw
Term Loan and a Series A New Term Loan.

“Tranche A Term Loan Exposure” means, with respect to any Lender, as of any date
of determination, the outstanding principal amount of the Tranche A Term Loans
of such Lender as of such date.

“Tranche A Term Loan Maturity Date” means the earlier of (i) April 20, 2016 and
(ii) the date on which all Tranche A Term Loans shall become due and payable in
full hereunder, whether by acceleration or otherwise.

“Tranche A Term Loan Note” means a promissory note in the form of Exhibit B-3,
as it may be amended, restated, supplemented or otherwise modified from time to
time.

“Tranche B New Term Loans” means New Term Loans with required annual principal
repayments not greater than 1% of the original principal amount of such New Term
Loans and otherwise with terms similar to the Tranche B Term Loans.

“Tranche B Term Loan” means a Tranche B Term Loan made by a Lender to Borrower
pursuant to Section 2.1(a).

“Tranche B Term Loan Commitment” means the commitment of a Lender to make or
otherwise fund a Tranche B Term Loan on the Third Restatement Date and “Tranche
B Term Loan Commitments” means such commitments of all Lenders in the aggregate.
The amount of each Lender’s Tranche B Term Loan Commitment, if any, is set forth
on Appendix A-2 or in the applicable Assignment Agreement, subject to any
adjustment or reduction pursuant to the terms and conditions hereof. The
aggregate amount of the Tranche B Term Loan Commitments as of the Third
Restatement Date is $600,000,000.

“Tranche B Term Loan Exposure” means, with respect to any Lender, as of any date
of determination, the outstanding principal amount of the Tranche B Term Loans
of such Lender.

“Tranche B Term Loan Maturity Date” means the earlier of (i) the date which is
seven years after the Third Restatement Date and (ii) the date on which all
Tranche B Term Loans shall become due and payable in full hereunder, whether by
acceleration or otherwise.

“Tranche B Term Loan Note” means a promissory note in the form of Exhibit B-4,
as it may be amended, restated, supplemented or otherwise modified from time to
time.

“Transactions” means the entry into this Agreement, the Original Credit
Agreement, the First Amended and Restated Credit Agreement, the Second Amended
and Restated Credit Agreement and the Credit Documents and the making of the
Loans hereunder and thereunder and the consummation of the Acquisitions on and
after the Second Restatement Date, and the payment of all fees and expenses
related thereto.

“Type of Loan” means (i) with respect to Tranche A Term Loans, a Base Rate Loan
or a Eurodollar Rate Loan, (ii) with respect to Tranche B Term Loans, a Base
Rate Loan or a Eurodollar Rate Loan and (iii) with respect to Revolving Loans, a
Base Rate Loan or a Eurodollar Rate Loan and (iv) with respect to Swing Line
Loans, a Base Rate Loan.

“UCC” means the Uniform Commercial Code (or any similar or equivalent
legislation) as in effect in any applicable jurisdiction.

 

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“VPI” as defined in the recitals hereto.

“VPI Convertible Notes” means VPI’s 4.0% Convertible Subordinated Notes due
2013, issued under that certain indenture dated as of November 19, 2003, among
VPI, Ribapharm Inc. and The Bank of New York Mellon, as trustee.

“Waivable Mandatory Prepayment” as defined in Section 2.15(d).

“WURA” means the Winding-Up and Restructuring Act (Canada).

1.2 Accounting Terms. Except as otherwise expressly provided herein, all
accounting terms not otherwise defined herein shall have the meanings assigned
to them in conformity with GAAP; provided that, if Borrower notifies the
Administrative Agent that Borrower requests an amendment to any provision
(including any definition) hereof to eliminate the effect of any change
occurring after the date hereof in GAAP or in the application thereof on the
operation of such provision (or if the Administrative Agent notifies Borrower
that the Requisite Lenders request an amendment to any provision hereof for such
purpose), regardless of whether any such notice is given before or after such
change in GAAP or in the application thereof, then such provision shall be
interpreted on the basis of GAAP as in effect and applied immediately before
such change shall have become effective until such notice shall have been
withdrawn or such provision amended in accordance herewith. Financial statements
and other information required to be delivered by Borrower to Lenders pursuant
to Sections 5.1(a) and 5.1(b) shall be prepared in accordance with GAAP as in
effect at the time of such preparation (and delivered together with the
reconciliation statements provided for in Section 5.1(d), if applicable).

1.3 Interpretation, etc. Any of the terms defined herein may, unless the context
otherwise requires, be used in the singular or the plural, depending on the
reference. References herein to any Section, Appendix, Schedule or Exhibit shall
be to a Section, an Appendix, a Schedule or an Exhibit, as the case may be,
hereof unless otherwise specifically provided. The use herein of the word
“include” or “including,” when following any general statement, term or matter,
shall not be construed to limit such statement, term or matter to the specific
items or matters set forth immediately following such word or to similar items
or matters, whether or not non limiting language (such as “without limitation”
or “but not limited to” or words of similar import) is used with reference
thereto, but rather shall be deemed to refer to all other items or matters that
fall within the broadest possible scope of such general statement, term or
matter. The terms lease and license shall include sub lease and sub license, as
applicable. A reference to a statute includes all regulations made pursuant to
such statute and, unless otherwise specified, the provisions of any statute or
regulation which amends, revises, restates, supplements or supersedes any such
statute or any such regulation. In this Agreement, where the terms “continuing,”
“continuance” or words to similar effect are used in relation to a Default or an
Event of Default, the terms shall mean only, in the case of a Default, that the
applicable event or circumstance has not been waived or, if capable of being
cured, cured, prior to the event becoming or resulting in an Event of Default,
and in the case of an Event of Default, that such event or circumstance has not
been waived.

For purposes of any assets, liabilities or entities located in the Province of
Québec or charged by any deed of hypothec (or any other Loan Document) and for
all other purposes pursuant to which the interpretation or construction of this
Agreement may be subject to the laws of the Province of Québec or a court or
tribunal exercising jurisdiction in the Province of Québec, (a) “personal
property” shall include “movable property,” (b) “real property” or “real estate”
shall include “immovable property,” (c) “tangible property” shall include
“corporeal property,” (d) “intangible property” shall include “incorporeal
property,” (e) “security interest,” “mortgage” and “lien” shall include a
“hypothec,” “right of retention,” “prior claim” and a “resolutory clause,”
(f) all references to filing, perfection, priority, remedies, registering or
recording under the UCC or PPSA shall include publication under the Civil Code
of Québec, (g) all

 

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references to “perfection” of or “perfected” liens or security interest shall
include a reference to a hypothec which is “opposable” or can be “set up” as
against third parties, (h) any “right of offset,” “right of setoff” or similar
expression shall include a “right of compensation,” (i) “common law” shall
include “civil law,” (j) “tort” shall include “extracontractual liability,”
(k) “bailor” shall include “depositor” and “bailee” shall include “depositary,”
(l) “goods” shall include “corporeal movable property” other than chattel paper,
documents of title, instruments, money and securities, (m) an “agent” shall
include a “mandatary,” (n) “construction liens” shall include “legal hypothecs
in favour of persons having taken part in the construction or renovation of an
immovable,” (o) “joint and several” shall include “solidary,” (p) “gross
negligence or willful misconduct” shall be deemed to be “intentional or gross
fault,” (q) “beneficial ownership” shall include “ownership” and “legal title”
shall include holding title on behalf of an owner as mandatary or prete-nom”;
(r) “easement” shall include “servitude,” (s) “priority” shall include “prior
claim” or “rank,” as applicable; (t) “survey” shall include “certificate of
location and plan,” (u) “state” shall include “province,” (v) “fee simple title”
shall include “ownership,” (w) “accounts” shall include “claims,”
(x) “conditional sale” shall include “instalment sale,” (y) “purchase money
financing” or “purchase money lien” shall include “instalment sales,
reservations of ownership, contracts of lease, leasing contracts and vendor’s
hypothecs.” The parties hereto confirm that it is their wish that this Agreement
and any other document executed in connection with the transactions contemplated
herein be drawn up in the English language only and that all other documents
contemplated thereunder or relating thereto, including notices, may also be
drawn up in the English language only. Les parties aux présentes confirment que
c’est leur volonté que cette convention et les autres documents de crédit soient
rédigés en langue anglaise seulement et que tous les documents, y compris tous
avis, envisagés par cette convention et les autres documents peuvent être
rédigés en langue anglaise seulement.

1.4 Currency Matters. All Obligations of each Credit Party under the Credit
Documents shall be payable in Dollars, and all calculations, comparisons,
measurements or determinations under the Credit Documents shall be made in
Dollars. For the purpose of such calculations, comparisons, measurements or
determinations, amounts denominated in other currencies shall be converted into
the Equivalent Amount of Dollars on the date of calculation, comparison,
measurement or determination.

1.5 Pro Forma Transactions. With respect to any period during which any
Permitted Acquisition or any sale, transfer or other disposition of any material
assets outside the ordinary course of business occurs, for purposes of
determining compliance with the covenants contained in Sections 6.1 and 6.7, or
for purposes of determining the Leverage Ratio as of any date, calculations with
respect to such period shall be made on a Pro Forma Basis.

1.6 Effect of This Agreement on the Second Amended and Restated Credit Agreement
and Other Credit Documents. Upon satisfaction of the conditions precedent to the
effectiveness of this Agreement set forth in Section 3.1 hereof, this Agreement
shall be binding on Borrower, the Agents, the Lenders and the other parties
hereto, and the Second Amended and Restated Credit Agreement and the provisions
thereof shall be replaced in their entirety by this Agreement and the provisions
hereof, with the parties hereby agreeing that there is no novation of the Second
Amended and Restated Credit Agreement; provided that the Collateral and the
Credit Documents shall continue to secure, guarantee, support and otherwise
benefit the Obligations of Borrower and the other Credit Parties under this
Agreement and the other Credit Documents. Upon the effectiveness of this
Agreement, each Credit Document that was in effect immediately prior to the date
of this Agreement shall continue to be effective and, unless the context
otherwise requires, any reference to the Credit Agreement contained therein
shall be deemed to refer to this Agreement.

 

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SECTION 2. LOANS AND LETTERS OF CREDIT

2.1 Term Loans.

(a) Loan Commitments. Subject to the terms and conditions hereof, each Lender
severally agrees to make, on the Third Restatement Date, Tranche B Term Loans in
Dollars to Borrower in an amount equal to such Lender’s Tranche B Term Loan
Commitment.

Any amount borrowed under this Section 2.1(a) and subsequently repaid or prepaid
may not be reborrowed. Subject to Sections 2.13(a) and 2.14, all amounts owed
hereunder with respect to the Tranche A Term Loans and the Tranche B Term Loans
shall be paid in full no later than the Tranche A Term Loan Maturity Date and
the Tranche B Term Loan Maturity Date, respectively. Each Lender’s Tranche B
Term Loan Commitment shall terminate immediately and without further action on
the Third Restatement Date after giving effect to the funding of such Lender’s
Tranche B Term Loan Commitment on such date.

(b) Borrowing Mechanics for Tranche B Term Loans on the Third Restatement Date.

(i) Borrower shall deliver to Administrative Agent a fully executed Funding
Notice for Tranche B Term Loans no later than three days prior to the Third
Restatement Date. Promptly upon receipt by Administrative Agent of such Funding
Notice, Administrative Agent shall notify each Lender of the proposed
borrowings.

(ii) Each Lender shall make its Tranche B Term Loan available to Administrative
Agent not later than 11:00 a.m. (New York City time) on the Third Restatement
Date, by wire transfer of same day funds in Dollars at the Principal Office
designated by Administrative Agent.

Upon satisfaction or waiver of the conditions precedent specified herein,
Administrative Agent shall make the proceeds of the Tranche B Term Loans
available to Borrower on the Third Restatement Date by causing an amount of same
day funds in Dollars equal to the proceeds of all such Loans received by
Administrative Agent from Lenders to be credited to the account of Borrower, at
the Principal Office designated by Administrative Agent or to such other account
as may be designated in writing to Administrative Agent by Borrower.

2.2 Revolving Loans.

(a) Revolving Commitments. During the Revolving Commitment Period, subject to
the terms and conditions hereof, each Lender severally agrees to make Revolving
Loans in Dollars to Borrower in an aggregate amount up to but not exceeding such
Lender’s Revolving Commitment; provided, that after giving effect to the making
of any Revolving Loans in no event shall the Total Utilization of Revolving
Commitments exceed the Revolving Commitments then in effect. Amounts borrowed
pursuant to this Section 2.2(a) may be repaid and reborrowed, only in the
currency borrowed, during the Revolving Commitment Period. Each Lender’s
Revolving Commitment shall expire on the Revolving Commitment Termination Date
and all Revolving Loans and all other amounts owed hereunder with respect to the
Revolving Loans and the Revolving Commitments shall be paid in full no later
than such date.

(b) Borrowing Mechanics for Revolving Loans.

(i) Except pursuant to Section 2.4(d), Revolving Loans that are Base Rate Loans
shall be made in an aggregate minimum amount of $5,000,000 and integral
multiples of $1,000,000 in excess of that amount, Revolving Loans that are
Eurodollar Rate Loans shall be in an aggregate minimum amount of $5,000,000 and
integral multiples of $1,000,000 in excess of that amount.

 

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(ii) Subject to Section 3.3(b), whenever Borrower desires that Lenders make
Revolving Loans, Borrower shall deliver to Administrative Agent a fully executed
and delivered Funding Notice no later than 1:00 p.m. (New York City time) at
least three Business Days in advance of the proposed Credit Date in the case of
a Eurodollar Rate Loan and at least one Business Day in advance of the proposed
Credit Date in the case of a Revolving Loan that is a Base Rate Loan.

(iii) Notice of receipt of each Funding Notice in respect of Revolving Loans,
together with the amount of each Lender’s Pro Rata Share thereof, if any,
together with the applicable interest rate, shall be provided by Administrative
Agent to each applicable Lender by telefacsimile with reasonable promptness, but
(provided Administrative Agent shall have received such notice by 1:00 p.m. (New
York City time)) not later than 2:00 p.m. (New York City time) on the same day
as Administrative Agent’s receipt of such Notice from Borrower.

(iv) Each Lender shall make the amount of its Revolving Loan available to
Administrative Agent not later than 12:00 p.m. (New York City time) on the
applicable Credit Date by wire transfer of same day funds in Dollars, at the
Principal Office designated by Administrative Agent. Except as provided herein,
upon satisfaction or waiver of the conditions precedent specified herein,
Administrative Agent shall make the proceeds of such Revolving Loans available
to Borrower on the applicable Credit Date by causing an amount of same day funds
in Dollars, equal to the proceeds of all such Revolving Loans received by
Administrative Agent from Lenders to be credited to the account of Borrower at
the Principal Office designated by Administrative Agent or such other account as
may be designated in writing to Administrative Agent by Borrower.

2.3 Swing Line Loans.

(a) Swing Line Loans Commitments. During the Revolving Commitment Period,
subject to the terms and conditions hereof, Swing Line Lender shall make Swing
Line Loans in Dollars to Borrower in the aggregate amount up to but not
exceeding the Swing Line Sublimit; provided, that after giving effect to the
making of any Swing Line Loan, in no event shall the Total Utilization of
Revolving Commitments exceed the Revolving Commitments then in effect. Amounts
borrowed pursuant to this Section 2.3 may be repaid and reborrowed during the
Revolving Commitment Period. Swing Line Lender’s Revolving Commitment shall
expire on the Revolving Commitment Termination Date and all Swing Line Loans and
all other amounts owed hereunder with respect to the Swing Line Loans and the
Revolving Commitments shall be paid in full no later than such date.

(b) Borrowing Mechanics for Swing Line Loans.

(i) Swing Line Loans shall be made in an aggregate minimum amount of $500,000
and integral multiples of $100,000 in excess of that amount.

(ii) Subject to Section 3.3(b), whenever Borrower desires that Swing Line Lender
make a Swing Line Loan, Borrower shall deliver to Administrative Agent a Funding
Notice no later than 12:00 p.m. (New York City time) on the proposed Credit
Date.

(iii) Swing Line Lender shall make the amount of its Swing Line Loan available
to Administrative Agent not later than 2:00 p.m. (New York City time) on the
applicable Credit Date by wire transfer of same day funds in Dollars, at the
Principal Office designated by Administrative Agent. Except as provided herein,
upon satisfaction or waiver of the conditions precedent specified herein,
Administrative

 

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Agent shall make the proceeds of such Swing Line Loans available to Borrower on
the applicable Credit Date by causing an amount of same day funds in Dollars
equal to the proceeds of all such Swing Line Loans received by Administrative
Agent from Swing Line Lender to be credited to the account of Borrower at the
Principal Office designated by Administrative Agent, or to such other account as
may be designated in writing to Administrative Agent by Borrower.

(iv) With respect to any Swing Line Loans which have not been voluntarily
prepaid by Borrower pursuant to Section 2.13, Swing Line Lender may at any time
in its sole and absolute discretion, deliver to Administrative Agent (with a
copy to Borrower), no later than 1:00 p.m. (New York City time) at least one
Business Day in advance of the proposed Credit Date, a notice (which shall be
deemed to be a Funding Notice given by Borrower) requesting that each Lender
holding a Revolving Commitment make Revolving Loans that are Base Rate Loans to
Borrower on such Credit Date in an amount equal to the amount of such Swing Line
Loans (the “Refunded Swing Line Loans”) outstanding on the date such notice is
given which Swing Line Lender requests Lenders to prepay. Anything contained in
this Agreement to the contrary notwithstanding, (1) the proceeds of such
Revolving Loans made by the Lenders other than Swing Line Lender shall be
immediately delivered by Administrative Agent to Swing Line Lender (and not to
Borrower) and applied to repay a corresponding portion of the Refunded Swing
Line Loans and (2) on the day such Revolving Loans are made, Swing Line Lender’s
Pro Rata Share of the Refunded Swing Line Loans (determined by reference to
Swing Line Lender’s Revolving Commitment, if any) shall be deemed to be paid
with the proceeds of a Revolving Loan made by Swing Line Lender to Borrower, and
such portion of the Swing Line Loans deemed to be so paid shall no longer be
outstanding as Swing Line Loans and shall no longer be due under the Swing Line
Note of Swing Line Lender but shall instead constitute part of Swing Line
Lender’s outstanding Revolving Loans to Borrower and shall be due under the
Revolving Loan Note issued by Borrower to Swing Line Lender. Borrower hereby
authorizes Administrative Agent and Swing Line Lender to charge Borrower’s
accounts with Administrative Agent and Swing Line Lender (up to the amount
available in each such account) in order to immediately pay Swing Line Lender
the amount of the Refunded Swing Line Loans to the extent of the proceeds of
such Revolving Loans made by Lenders, including the Revolving Loans deemed to be
made by Swing Line Lender, are not sufficient to repay in full the Refunded
Swing Line Loans. If any portion of any such amount paid (or deemed to be paid)
to Swing Line Lender should be recovered by or on behalf of Borrower from Swing
Line Lender in bankruptcy, by assignment for the benefit of creditors or
otherwise, the loss of the amount so recovered shall be ratably shared among all
Lenders in the manner contemplated by Section 2.17.

(v) If for any reason Revolving Loans are not made pursuant to
Section 2.3(b)(iv) in an amount sufficient to repay any amounts owed to Swing
Line Lender in respect of any outstanding Swing Line Loans on or before the
third Business Day after demand for payment thereof by Swing Line Lender, each
Lender holding a Revolving Commitment shall be deemed to, and hereby agrees to,
have purchased a participation in such outstanding Swing Line Loans, and in an
amount equal to its Pro Rata Share of the applicable unpaid amount together with
accrued interest thereon. Upon one Business Day’s notice from Swing Line Lender,
each Lender holding a Revolving Commitment shall deliver to Swing Line Lender an
amount equal to its respective participation in the applicable unpaid amount in
same day funds at the Principal Office of Swing Line Lender. In order to
evidence such participation each Lender holding a Revolving Commitment agrees to
enter into a participation agreement at the request of Swing Line Lender in form
and substance reasonably satisfactory to Swing Line Lender. In the event any
Lender holding a Revolving Commitment fails to make available to Swing Line
Lender the amount of such Lender’s participation as provided in this paragraph,
Swing Line Lender shall be entitled to recover such amount on demand from such
Lender together with interest thereon for three Business Days at the rate
customarily used by Swing Line Lender for the correction of errors among banks
and thereafter at the Base Rate, as applicable.

 

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(vi) Notwithstanding anything contained herein to the contrary, (1) each
Lender’s obligation to make Revolving Loans for the purpose of repaying any
Refunded Swing Line Loans pursuant to the second preceding paragraph and each
Lender’s obligation to purchase a participation in any unpaid Swing Line Loans
pursuant to the immediately preceding paragraph shall be absolute and
unconditional and shall not be affected by any circumstance, including (A) any
set-off, counterclaim, recoupment, defense or other right which such Lender may
have against Swing Line Lender, any Credit Party or any other Person for any
reason whatsoever; (B) the occurrence or continuation of a Default or Event of
Default; (C) any adverse change in the business, operations, properties, assets,
condition (financial or otherwise) or prospects of any Credit Party; (D) any
breach of this Agreement or any other Credit Document by any party thereto; or
(E) any other circumstance, happening or event whatsoever, whether or not
similar to any of the foregoing; provided that such obligations of each Lender
are subject to the condition that Swing Line Lender had not received prior
notice from Borrower or the Requisite Lenders that any of the conditions under
Section 3.3 to the making of the applicable Refunded Swing Line Loans or other
unpaid Swing Line Loans, were not satisfied at the time such Refunded Swing Line
Loans or unpaid Swing Line Loans were made; and (2) Swing Line Lender shall not
be obligated to make any Swing Line Loans (A) if it has elected not to do so
after the occurrence and during the continuation of a Default or Event of
Default, (B) it does not in good faith believe that all conditions under
Section 3.3 to the making of such Swing Line Loan have been satisfied or waived
by the Requisite Lenders or (C) at a time when any Lender is a Defaulting Lender
unless Swing Line Lender has entered into arrangements reasonably satisfactory
to it and Borrower to eliminate Swing Line Lender’s risk with respect to the
Defaulting Lender’s participation in such Swing Ling Loan, including by cash
collateralizing such Defaulting Lender’s Pro Rata Share of the outstanding Swing
Line Loans.

(c) Resignation and Removal of Swing Line Lender. Swing Line Lender may resign
as Swing Line Lender upon 30 days’ prior written notice to Administrative Agent,
Lenders and Borrower. Swing Line Lender may be replaced at any time by written
agreement among Borrower, Administrative Agent, the replaced Swing Line Lender
(provided that no consent will be required if the replaced Swing Line Lender has
no Swing Line Loans outstanding) and the successor Swing Line Lender.
Administrative Agent shall notify the Lenders of any such replacement of Swing
Line Lender. At the time any such replacement or resignation shall become
effective, (i) Borrower shall prepay any outstanding Swing Line Loans made by
the resigning or removed Swing Line Lender, (ii) upon such prepayment, the
resigning or removed Swing Line Lender shall surrender any Swing Line Note held
by it to Borrower for cancellation, and (iii) Borrower shall issue, if so
requested by the successor Swing Line Lender, a new Swing Line Note to the
successor Swing Line Lender, in the principal amount of the Swing Line Sublimit
then in effect and with other appropriate insertions. From and after the
effective date of any such replacement or resignation, (x) any successor Swing
Line Lender shall have all the rights and obligations of a Swing Line Lender
under this Agreement with respect to Swing Line Loans made thereafter and
(y) references herein to the term “Swing Line Lender” shall be deemed to refer
to such successor or to any previous Swing Line Lender, or to such successor and
all previous Swing Line Lenders, as the context shall require.

2.4 Issuance of Letters of Credit and Purchase of Participations Therein.

(a) Letters of Credit. During the Revolving Commitment Period, subject to the
terms and conditions hereof, Issuing Bank agrees to issue Letters of Credit for
the account of Borrower; provided, (i) each Letter of Credit shall be
denominated in Dollars; (ii) the stated amount of each Letter of Credit shall
not be less than $250,000 or such lesser amount as is acceptable to Issuing
Bank; (iii) after giving effect to such issuance, in no event shall the Total
Utilization of Revolving Commitments exceed the Revolving Commitments then in
effect; (iv) after giving effect to such issuance, in no event shall the Letter
of Credit Usage exceed the Letter of Credit Sublimit then in effect; (v) in no
event shall any standby Letter of Credit have an expiration date later than the
earlier of (1) the Revolving Commitment Termination Date and (2) the date which
is one year from the date of issuance of such standby Letter of Credit; (vi) in

 

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no event shall any Letter of Credit have an expiration date later than the
earlier of (1) the Revolving Commitment Termination Date and (2) the date which
is one year from the date of issuance of such commercial Letter of Credit; and
(vii) Issuing Bank shall be under no obligation to issue any Letter of Credit if
the issuance of such Letter of Credit would violate one or more policies of
Issuing Bank applicable to letters of credit generally and not solely to letters
of credit issuable to Borrower. Subject to the foregoing, Issuing Bank may agree
that a standby Letter of Credit will automatically be extended for one or more
successive periods not to exceed one year each, unless Issuing Bank elects not
to extend for any such additional period, and so notifies the beneficiary
thereof 30 days in advance that such standby Letter of Credit will not be so
extended; provided that Issuing Bank shall not extend any such Letter of Credit
if it has received written notice that an Event of Default has occurred and is
continuing at the time Issuing Bank must elect to allow such extension;
provided, further, that if any Lender is a Defaulting Lender, Issuing Bank shall
not be required to issue any Letter of Credit unless Issuing Bank has entered
into arrangements reasonably satisfactory to it and Borrower to eliminate
Issuing Bank’s risk with respect to the participation in Letters of Credit of
the Defaulting Lender, including by cash collateralizing such Defaulting
Lender’s Pro Rata Share of the Letter of Credit Usage.

(b) Notice of Issuance. Subject to Section 3.3(b), whenever Borrower desires the
issuance, amendment or modification of a Letter of Credit, it shall deliver to
Administrative Agent an Issuance Notice no later than 12:00 p.m. (New York City
time) at least three Business Days (in the case of standby letters of credit) or
five Business Days (in the case of commercial letters of credit), or in each
case such shorter period as may be agreed to by Issuing Bank in any particular
instance, in advance of the proposed date of issuance, amendment or
modification. Upon satisfaction or waiver of the conditions set forth in
Section 3.3, Issuing Bank shall issue, amend or modify the requested Letter of
Credit only in accordance with Issuing Bank’s standard operating procedures.
Upon the issuance of any Letter of Credit or amendment or modification to a
Letter of Credit, Issuing Bank shall promptly notify each Lender with a
Revolving Commitment of such issuance, which notice shall be accompanied by a
copy of such Letter of Credit or amendment or modification to a Letter of Credit
and the amount of such Lender’s respective participation in such Letter of
Credit pursuant to Section 2.4(e).

(c) Responsibility of Issuing Bank with Respect to Requests for Drawings and
Payments. In determining whether to honor any drawing under any Letter of Credit
by the beneficiary thereof, Issuing Bank shall be responsible only to examine
the documents delivered under such Letter of Credit with reasonable care so as
to ascertain whether they appear on their face to be in accordance with the
terms and conditions of such Letter of Credit. As between Borrower and Issuing
Bank, Borrower assumes all risks of the acts and omissions of, or misuse of the
Letters of Credit issued by Issuing Bank, by the respective beneficiaries of
such Letters of Credit. In furtherance and not in limitation of the foregoing,
Issuing Bank shall not be responsible for: (i) the form, validity, sufficiency,
accuracy, genuineness or legal effect of any document submitted by any party in
connection with the application for and issuance of any such Letter of Credit,
even if it should in fact prove to be in any or all respects invalid,
insufficient, inaccurate, fraudulent or forged; (ii) the validity or sufficiency
of any instrument transferring or assigning or purporting to transfer or assign
any such Letter of Credit or the rights or benefits thereunder or proceeds
thereof, in whole or in part, which may prove to be invalid or ineffective for
any reason; (iii) failure of the beneficiary of any such Letter of Credit to
comply fully with any conditions required in order to draw upon such Letter of
Credit; (iv) errors, omissions, interruptions or delays in transmission or
delivery of any messages, by mail, cable, telegraph, telex or otherwise, whether
or not they be in cipher; (v) errors in interpretation of technical terms;
(vi) any loss or delay in the transmission or otherwise of any document required
in order to make a drawing under any such Letter of Credit or of the proceeds
thereof; (vii) the misapplication by the beneficiary of any such Letter of
Credit of the proceeds of any drawing under such Letter of Credit; or (viii) any
consequences arising from causes beyond the control of Issuing Bank, including
any Governmental Acts; none of the above shall affect or impair, or prevent the
vesting of, any of Issuing Bank’s rights or powers hereunder. Without limiting
the foregoing and in furtherance thereof, any action

 

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taken or omitted by Issuing Bank under or in connection with the Letters of
Credit or any documents and certificates delivered thereunder, if taken or
omitted in good faith, shall not give rise to any liability on the part of
Issuing Bank to Borrower. Notwithstanding anything to the contrary contained in
this Section 2.4(c), Borrower shall retain any and all rights it may have
against Issuing Bank for any liability arising solely out of the gross
negligence or willful misconduct of Issuing Bank.

(d) Reimbursement by Borrower of Amounts Drawn or Paid Under Letters of Credit.
In the event Issuing Bank has determined to honor a drawing under a Letter of
Credit, it shall immediately notify Borrower and Administrative Agent, and
Borrower shall reimburse Issuing Bank on or before the Business Day immediately
following the date on which Borrower was notified by Issuing Bank that such
drawing was honored (the “Reimbursement Date”) in an amount in Dollars and in
same day funds equal to the amount of such honored drawing; provided that
anything contained herein to the contrary notwithstanding, (i) unless Borrower
shall have notified Administrative Agent and Issuing Bank prior to 10:00 a.m.
(New York City time) on the date such drawing is honored that Borrower intends
to reimburse Issuing Bank for the amount of such honored drawing with funds
other than the proceeds of Revolving Loans, Borrower shall be deemed to have
given a timely Funding Notice to Administrative Agent requesting Lenders with
Revolving Commitments to make Revolving Loans that are Base Rate Loans on the
Reimbursement Date in an amount in Dollars equal to the amount of such honored
drawing, and (ii) subject to satisfaction or waiver of the conditions specified
in Section 3.3, Lenders with Revolving Commitments shall, on the Reimbursement
Date, make Revolving Loans that are Base Rate Loans in the amount of such
honored drawing, the proceeds of which shall be applied directly by
Administrative Agent to reimburse Issuing Bank for the amount of such honored
drawing; and provided, further, that if for any reason proceeds of Revolving
Loans are not received by Issuing Bank on the Reimbursement Date in an amount
equal to the amount of such honored drawing, Borrower shall reimburse Issuing
Bank, on demand, in an amount in same day funds equal to the excess of the
amount of such honored drawing over the aggregate amount of proceeds of such
Revolving Loans, if any, which are so received. Nothing in this Section 2.4(d)
shall be deemed to relieve any Lender with a Revolving Commitment from its
obligation to make Revolving Loans on the terms and conditions set forth herein,
and Borrower shall retain any and all rights it may have against any such Lender
resulting from the failure of such Lender to make such Revolving Loans under
this Section 2.4(d).

(e) Lenders’ Purchase of Participations in Letters of Credit. Immediately upon
the issuance of each Letter of Credit, each Lender having a Revolving Commitment
shall be deemed to have purchased, and hereby agrees to irrevocably purchase,
from Issuing Bank a participation in such Letter of Credit and any drawings
honored thereunder in an amount equal to such Lender’s Pro Rata Share (with
respect to the Revolving Commitments) of the maximum amount which is or at any
time may become available to be drawn thereunder. In the event that Borrower
shall fail for any reason to reimburse Issuing Bank as provided in
Section 2.4(d), Issuing Bank shall promptly notify Administrative Agent of the
unreimbursed amount of such honored drawing and Administrative Agent shall
notify each Lender with a Revolving Commitment of such Lender’s respective
participation therein based on such Lender’s Pro Rata Share of the Revolving
Commitments. Each Lender with a Revolving Commitment shall make available to
Administrative Agent for the account of the Issuing Bank an amount equal to its
respective participation, in Dollars and in same day funds, at the office of
Administrative Agent specified in such notice, not later than 12:00 p.m. (New
York City time) on the first business day (under the laws of the jurisdiction in
which such office of Issuing Bank is located) after the date notified by
Administrative Agent. The Administrative Agent shall remit the funds so received
to the Issuing Bank. In the event that any Lender with a Revolving Commitment
fails to make available to Administrative Agent for the account of the Issuing
Bank on such business day the amount of such Lender’s participation in such
Letter of Credit as provided in this Section 2.4(e), Issuing Bank (acting
through the Administrative Agent) shall be entitled to recover such amount on
demand from such Lender together with interest thereon for three Business Days
at the rate customarily used by Issuing Bank for the correction of errors among
banks and thereafter

 

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at the Base Rate. Nothing in this Section 2.4(e) shall be deemed to prejudice
the right of any Lender with a Revolving Commitment to recover from Issuing Bank
any amounts made available by such Lender to Issuing Bank pursuant to this
Section in the event that the payment with respect to a Letter of Credit in
respect of which payment was made by such Lender constituted gross negligence or
willful misconduct on the part of Issuing Bank. In the event Issuing Bank
(acting through the Administrative Agent) shall have been reimbursed by other
Lenders pursuant to this Section 2.4(e) for all or any portion of any drawing
honored by Issuing Bank under a Letter of Credit, the Issuing Bank (acting
through the Administrative Agent) shall distribute to each Lender which has paid
all amounts payable by it under this Section 2.4(e) with respect to such honored
drawing such Lender’s Pro Rata Share of all payments subsequently received by
Issuing Bank from Borrower in reimbursement of such honored drawing when such
payments are received. Any such distribution shall be made to a Lender at its
primary address set forth below its name on Appendix B or at such other address
as such Lender may request.

(f) Obligations Absolute. The obligation of Borrower to reimburse Issuing Bank
for drawings honored under the Letters of Credit issued by it and to repay any
Revolving Loans made by Lenders pursuant to Section 2.4(d) and the obligations
of Lenders under Section 2.4(e) shall be unconditional and irrevocable and shall
be paid strictly in accordance with the terms hereof under all circumstances
including any of the following circumstances: (i) any lack of validity or
enforceability of any Letter of Credit; (ii) the existence of any claim,
set-off, defense or other right which Borrower or any Lender may have at any
time against a beneficiary or any transferee of any Letter of Credit (or any
Persons for whom any such transferee may be acting), Issuing Bank, Lender or any
other Person or, in the case of a Lender, against Borrower, whether in
connection herewith, the transactions contemplated herein or any unrelated
transaction (including any underlying transaction between Borrower or one of its
Subsidiaries and the beneficiary for which any Letter of Credit was procured);
(iii) any draft or other document presented under any Letter of Credit proving
to be forged, fraudulent, invalid or insufficient in any respect or any
statement therein being untrue or inaccurate in any respect; (iv) payment by
Issuing Bank under any Letter of Credit against presentation of a draft or other
document which does not substantially comply with the terms of such Letter of
Credit; (v) any adverse change in the business, operations, properties, assets,
condition (financial or otherwise) or prospects of Borrower or any of its
Subsidiaries; (vi) any breach hereof or any other Credit Document by any party
thereto; (vii) any other circumstance or happening whatsoever, whether or not
similar to any of the foregoing; or (viii) the fact that an Event of Default or
a Default shall have occurred and be continuing; provided, in each case, that
payment by Issuing Bank under the applicable Letter of Credit shall not have
constituted gross negligence or willful misconduct of Issuing Bank under the
circumstances in question.

(g) Indemnification. Without duplication of any obligation of Borrower under
Section 10.2 or 10.3, in addition to amounts payable as provided herein,
Borrower hereby agrees to protect, indemnify, pay and save harmless Issuing Bank
from and against any and all claims, demands, liabilities, damages, losses,
costs, charges and expenses (including reasonable fees, expenses and
disbursements of counsel and allocated costs of internal counsel) which Issuing
Bank may incur or be subject to as a consequence, direct or indirect, of (i) the
issuance of any Letter of Credit by Issuing Bank, other than as a result of
(1) the gross negligence or willful misconduct of Issuing Bank or (2) the
wrongful dishonor by Issuing Bank of a proper demand for payment made under any
Letter of Credit issued by it, or (ii) the failure of Issuing Bank to honor a
drawing under any such Letter of Credit as a result of any Governmental Act,
other than any Governmental Act resulting from the gross negligence or willful
misconduct of Issuing Bank.

(h) Resignation and Removal of Issuing Bank. An Issuing Bank may resign as
Issuing Bank upon 60 days prior written notice to Administrative Agent, Lenders
and Borrower. An Issuing Bank may be replaced at any time by written agreement
among Borrower, Administrative Agent, the replaced Issuing Bank (provided that
no consent will be required if the replaced Issuing Bank has no Letters of
Credit or reimbursement Obligations with respect thereto outstanding) and the
successor Issuing Bank.

 

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Administrative Agent shall notify the Lenders of any such replacement of the
Issuing Bank. At the time any such replacement or resignation shall become
effective, Borrower shall pay all unpaid fees accrued for the account of the
replaced Issuing Bank. From and after the effective date of any such replacement
or resignation, (i) any successor Issuing Bank shall have all the rights and
obligations of an Issuing Bank under this Agreement with respect to Letters of
Credit to be issued thereafter and (ii) references herein to the term “Issuing
Bank” shall be deemed to refer to such successor or to any previous Issuing
Bank, or to such successor and all previous Issuing Banks, as the context shall
require. After the replacement or resignation of an Issuing Bank hereunder, the
replaced Issuing Bank shall remain a party hereto to the extent that Letters of
Credit issued by it remain outstanding and shall continue to have all the rights
and obligations of an Issuing Bank under this Agreement with respect to Letters
of Credit issued by it prior to such replacement or resignation, but shall not
be required to issue additional Letters of Credit.

2.5 Pro Rata Shares; Availability of Funds.

(a) Pro Rata Shares. All Loans shall be made, and all participations shall be
purchased, by Lenders simultaneously and proportionately to their respective Pro
Rata Shares, it being understood that no Lender shall be responsible for any
default by any other Lender in such other Lender’s obligation to make a Loan
requested hereunder or purchase a participation required hereby nor shall any
Term Loan Commitment or Revolving Commitment of any Lender be increased or
decreased as a result of a default by any other Lender in such other Lender’s
obligation to make a Loan requested hereunder or purchase a participation
required hereby.

(b) Availability of Funds. Unless Administrative Agent shall have been notified
by any Lender prior to the applicable Credit Date that such Lender does not
intend to make available to Administrative Agent the amount of such Lender’s
Loan requested on such Credit Date, Administrative Agent may assume that such
Lender has made such amount available to Administrative Agent on such Credit
Date and Administrative Agent may, in its sole discretion, but shall not be
obligated to, make available to Borrower a corresponding amount on such Credit
Date. If such corresponding amount is not in fact made available to
Administrative Agent by such Lender, Administrative Agent shall be entitled to
recover such corresponding amount on demand from such Lender together with
interest thereon, for each day from such Credit Date until the date such amount
is paid to Administrative Agent, at the customary rate set by Administrative
Agent for the correction of errors among banks for three Business Days and
thereafter at the Base Rate. If such Lender does not pay such corresponding
amount forthwith upon Administrative Agent’s demand therefor, Administrative
Agent shall promptly notify Borrower and Borrower shall immediately pay such
corresponding amount to Administrative Agent together with interest thereon, for
each day from such Credit Date until the date such amount is paid to
Administrative Agent, at the rate payable hereunder for Base Rate Loans for such
Class of Loans. Nothing in this Section 2.5(b) shall be deemed to relieve any
Lender from its obligation to fulfill its Term Loan Commitments and Revolving
Commitments hereunder or to prejudice any rights that Borrower may have against
any Lender as a result of any default by such Lender hereunder.

2.6 Use of Proceeds.

(a) The proceeds of the Loans shall be used as follows:

(i) the proceeds of the Revolving Loans, Swing Line Loans and Letters of Credit
made after the Third Restatement Date shall be applied by Borrower, as
applicable, to (A) finance a portion of any Acquisition and pay related fees and
expenses, (B) fund permitted capital expenditures and permitted acquisitions,
(C) provide for the ongoing working capital requirements of Borrower and its
Subsidiaries and (D) provide for general corporate purposes of Borrower and its
Subsidiaries; and

 

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(ii) the proceeds of the Tranche B Term Loans made on the Third Restatement Date
shall be applied by Borrower, as applicable, to (A) repay a portion of the
Revolving Loans outstanding as of the Third Restatement Date (but not to
permanently reduce Revolving Commitments with respect thereto), (B) fund
permitted capital expenditures and permitted acquisitions, (C) provide for
general corporate purposes of Borrower and its Subsidiaries and (D) pay all fees
and expenses in connection with the incurrence of the Tranche B Term Loans and
the repayment of Revolving Loans (including fees and expenses in connection with
the amendment and restatement of the Second Amended and Restated Credit
Agreement).

(b) No portion of the proceeds of any Credit Extension shall be used in any
manner that causes or might cause such Credit Extension or the application of
such proceeds to violate Regulation T, Regulation U or Regulation X of the Board
of Governors or any other regulation thereof.

2.7 Evidence of Debt; Register; Lenders’ Books and Records; Notes.

(a) Lenders’ Evidence of Debt. Each Lender shall maintain on its internal
records an account or accounts evidencing the Obligations of Borrower to such
Lender, including the amounts of the Loans made by it and each repayment and
prepayment in respect thereof. Any such recordation shall be conclusive and
binding on Borrower, absent manifest error; provided, that the failure to make
any such recordation, or any error in such recordation, shall not affect any
Lender’s Revolving Commitments or Borrower’s Obligations in respect of any
applicable Loans; and provided further that, in the event of any inconsistency
between the Register and any Lender’s records, the recordations in the Register
shall govern.

(b) Register. Administrative Agent (or its agent or sub-agent appointed by it)
shall maintain at the Principal Office designated by Administrative Agent a
register for the recordation of the names and addresses of Lenders and the
Revolving Commitments and Loans of each Lender from time to time (the
“Register”). The Register shall be available for inspection by Borrower or any
Lender (with respect to any entry relating to such Lender’s Loans) at any
reasonable time and from time to time upon reasonable prior notice.
Administrative Agent shall record, or shall cause to be recorded, in the
Register the Revolving Commitments and the Loans in accordance with the
provisions of Section 10.6, and each repayment or prepayment in respect of the
principal amount of the Loans, and any such recordation shall be conclusive and
binding on Borrower and each Lender, absent manifest error; provided that
failure to make any such recordation, or any error in such recordation, shall
not affect any Lender’s Revolving Commitments or Borrower’s Obligations in
respect of any Loan. Borrower hereby designates Administrative Agent to serve as
Borrower’s agent solely for purposes of maintaining the Register as provided in
this Section 2.7, and Borrower hereby agrees that, to the extent Administrative
Agent serves in such capacity, Administrative Agent and its officers, directors,
employees, agents, sub-agents and affiliates shall constitute “Indemnitees.”

(c) Notes. If so requested by any Lender by written notice to Borrower (with a
copy to Administrative Agent) at least two Business Days prior to the Third
Restatement Date, or at any time thereafter, Borrower shall execute and deliver
to such Lender (and/or, if applicable and if so specified in such notice, to any
Person who is an assignee of such Lender pursuant to Section 10.6) on the Third
Restatement Date (or, if such notice is delivered after the Third Restatement
Date, as promptly as practicable after Borrower’s receipt of such notice) a Note
or Notes to evidence such Lender’s Tranche A Term Loans, Tranche B Term Loans,
New Term Loans, Revolving Loan or Swing Line Loan, as the case may be.

 

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2.8 Interest on Loans.

(a) Except as otherwise set forth herein, each Class of Loans shall bear
interest on the unpaid principal amount thereof from the date made through
repayment (whether by acceleration or otherwise) thereof as follows:

(i) in the case of Tranche A Term Loans and Revolving Loans:

 

  •  

if a Base Rate Loan, at the Base Rate plus the Applicable Margin; or

 

  •  

if a Eurodollar Rate Loan, at the Adjusted Eurodollar Rate plus the Applicable
Margin; and

(ii) in the case of Swing Line Loans, at the Base Rate plus the Applicable
Margin; and

(iii) in the case of Tranche B Loans:

 

  •  

if a Base Rate Loan, at the Base Rate plus the Applicable Margin; or

 

  •  

if a Eurodollar Rate Loan, at the Adjusted Eurodollar Rate plus the Applicable
Margin.

(b) The basis for determining the rate of interest with respect to any Loan
(except a Swing Line Loan which can be made and maintained as a Base Rate Loan
only), and the Interest Period with respect to any Eurodollar Rate Loan, shall
be selected by Borrower and notified to Administrative Agent and Lenders
pursuant to the applicable Funding Notice or Conversion/Continuation Notice, as
the case may be; provided that, until the date on which Administrative Agent
notifies Borrower that the primary syndication of the Loans and Revolving
Commitments has been completed, as determined by Administrative Agent (but in no
event to exceed 90 days after the Third Restatement Date), the Tranche B Term
Loans shall be maintained as either (1) Eurodollar Rate Loans having an Interest
Period of no longer than three months or (2) Base Rate Loans. If on any day a
Loan is outstanding with respect to which a Funding Notice or
Conversion/Continuation Notice has not been delivered to Administrative Agent in
accordance with the terms hereof specifying the applicable basis for determining
the rate of interest, then for that day such Loan shall be a Base Rate Loan.

(c) In connection with Eurodollar Rate Loans there shall be no more than seven
(7) Interest Periods outstanding at any time. In the event Borrower fails to
specify between a Base Rate Loan or a Eurodollar Rate Loan in the applicable
Funding Notice or Conversion/Continuation Notice, such Loan (if outstanding as a
Eurodollar Rate Loan) will be automatically converted into a Base Rate Loan on
the last day of then current Interest Period for such Loan (or if outstanding as
a Base Rate Loan will remain as, or (if not then outstanding) will be made as, a
Base Rate Loan). In the event Borrower fails to specify an Interest Period for
any Eurodollar Rate Loan in the applicable Funding Notice or
Conversion/Continuation Notice, Borrower shall be deemed to have selected an
Interest Period of one month. As soon as practicable after 10:00 a.m. (New York
City time) on each Interest Rate Determination Date, Administrative Agent shall
determine (which determination shall, absent manifest error, be final,
conclusive and binding upon all parties) the interest rate that shall apply to
the Eurodollar Rate Loans for which an interest rate is then being determined
for the applicable Interest Period and shall promptly give notice thereof (in
writing or by telephone confirmed in writing) to Borrower and each Lender.

 

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(d) Interest payable pursuant to Section 2.8(a) shall be computed (i) in the
case of Base Rate Loans (other than Base Rate Loans for which the Base Rate has
been calculated pursuant to the third sentence of the definition thereof), on
the basis of a 365 day or 366 day year, as the case may be, and (ii) in the case
of Eurodollar Rate Loans and Base Rate Loans for which the Base Rate has been
calculated pursuant to the third sentence of the definition thereof, on the
basis of a 360 day year, in each case for the actual number of days elapsed in
the period during which it accrues. In computing interest on any Loan, the date
of the making of such Loan or the first day of an Interest Period applicable to
such Loan or, with respect to a Term Loan, the last Interest Payment Date with
respect to such Term Loan or, with respect to a Base Rate Loan being converted
from a Eurodollar Rate Loan, the date of conversion of such Eurodollar Rate Loan
to such Base Rate Loan shall be included, and the date of payment of such Loan
or the expiration date of an Interest Period applicable to such Loan or, with
respect to a Base Rate Loan being converted to a Eurodollar Rate Loan, the date
of conversion of such Base Rate Loan to such Eurodollar Rate Loan shall be
excluded; provided that, if a Loan is repaid on the same day on which it is
made, one day’s interest shall be paid on that Loan.

(e) Except as otherwise set forth herein, interest on each Loan (i) shall accrue
on a daily basis and shall be payable in arrears on each Interest Payment Date
with respect to interest accrued on and to each such payment date; (ii) shall
accrue on a daily basis and shall be payable in arrears upon any prepayment of
that Loan, whether voluntary or mandatory, to the extent accrued on the amount
being prepaid; and (iii) shall accrue on a daily basis and shall be payable in
arrears at maturity of the Loans, including final maturity of the Loans;
provided, however, with respect to any voluntary prepayment of a Revolving Loan
that is a Base Rate Loan, accrued interest shall instead be payable on the
applicable Interest Payment Date.

(f) Borrower agrees to pay to Issuing Bank, with respect to drawings honored
under any Letter of Credit, interest on the amount paid by Issuing Bank in
respect of each such honored drawing from the date such drawing is honored to
but excluding the date such amount is reimbursed by or on behalf of Borrower at
a rate equal to (i) for the period from the date such drawing is honored to but
excluding the applicable Reimbursement Date, the rate of interest otherwise
payable hereunder with respect to Revolving Loans that are Base Rate Loans, and
(ii) thereafter, the rate of interest required pursuant to Section 2.10.

(g) Interest payable pursuant to Section 2.8(f) shall be computed on the basis
of a 365/366 day year for the actual number of days elapsed in the period during
which it accrues, and shall be payable on demand or, if no demand is made, on
the date on which the related drawing under a Letter of Credit is reimbursed in
full. Promptly upon receipt by Issuing Bank of any payment of interest pursuant
to Section 2.8(g), Issuing Bank shall distribute to each Lender, out of the
interest received by Issuing Bank in respect of the period from the date such
drawing is honored to but excluding the date on which Issuing Bank is reimbursed
for the amount of such drawing (including any such reimbursement out of the
proceeds of any Revolving Loans), the amount that such Lender would have been
entitled to receive in respect of the letter of credit fee that would have been
payable in respect of such Letter of Credit for such period if no drawing had
been honored under such Letter of Credit. In the event Issuing Bank shall have
been reimbursed by Lenders for all or any portion of such honored drawing,
Issuing Bank shall distribute to each Lender which has paid all amounts payable
by it under Section 2.4(e) with respect to such honored drawing such Lender’s
Pro Rata Share of any interest received by Issuing Bank in respect of that
portion of such honored drawing so reimbursed by Lenders for the period from the
date on which Issuing Bank was so reimbursed by Lenders to but excluding the
date on which such portion of such honored drawing is reimbursed by Borrower.

 

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2.9 Conversion/Continuation.

(a) Subject to Section 2.18 and so long as no Default or Event of Default shall
have occurred and then be continuing, Borrower shall have the option:

(i) to convert at any time all or any part of any Term Loan or Revolving Loan
equal to $5,000,000 and integral multiples of $1,000,000 in excess of that
amount from one Type of Loan to another Type of Loan; provided that a Eurodollar
Rate Loan may only be converted on the expiration of the Interest Period
applicable to such Eurodollar Rate Loan unless Borrower shall pay all amounts
due under Section 2.18 in connection with any such conversion;

(ii) upon the expiration of any Interest Period applicable to any Eurodollar
Rate Loan, to continue all or any portion of such Loan equal to $5,000,000 and
integral multiples of $1,000,000 in excess of that amount as a Eurodollar Rate
Loan;

(b) Subject to Section 3.3(b), Borrower shall deliver a Conversion/Continuation
Notice to Administrative Agent no later than 10:00 a.m. (New York City time) at
least one Business Day in advance of the proposed conversion date (in the case
of a conversion to a Base Rate Loan), at least three Business Days in advance of
the proposed conversion/continuation date (in the case of a conversion to, or a
continuation of, a Eurodollar Rate Loan).

2.10 Default Interest. Upon the occurrence and during the continuance of an
Event of Default, any overdue amounts shall thereafter bear interest (including
post petition interest in any proceeding under Insolvency Laws) payable on
demand at a rate which is 2% per annum in excess of the interest rate otherwise
payable hereunder for Base Rate Loans (or, in the case of any fees and other
amounts, at a rate which is 2% per annum in excess of the interest rate
otherwise payable hereunder for Base Rate Loans). Payment or acceptance of the
increased rates of interest provided for in this Section 2.10 is not a permitted
alternative to timely payment and shall not constitute a waiver of any Event of
Default or otherwise prejudice or limit any rights or remedies of Administrative
Agent or any Lender.

2.11 Fees.

(a) Borrower agrees to pay to Lenders having Revolving Exposure (for purposes of
clarity, excluding the Issuing Bank, in its capacity as such):

(i) commitment fees accruing at 0.50% per annum on the average of the daily
difference between (a) the Revolving Commitments, and (b) the aggregate
principal amount of (x) all outstanding Revolving Loans (for the avoidance of
doubt, excluding Swing Line Loans) plus (y) the Letter of Credit Usage; and

(ii) letter of credit fees accruing at the Applicable Margin for Revolving Loans
that are Eurodollar Rate Loans on the average aggregate daily maximum amount
available to be drawn under all such Letters of Credit (regardless of whether
any conditions for drawing could then be met and determined as of the close of
business on any date of determination).

Notwithstanding the foregoing, any commitment fee which accrued with respect to
the Revolving Commitment of a Defaulting Lender during the period prior to the
time such Lender became a Defaulting Lender and unpaid at such time shall not be
payable by Borrower so long as such Lender shall be a Defaulting Lender except
to the extent that such commitment fee shall otherwise have been due and payable
by Borrower prior to such time; and provided, further, that no such commitment
fee shall accrue on the Revolving Commitment of a Defaulting Lender so long as
such Lender shall be a Defaulting Lender. All fees referred to in this
Section 2.11(a) shall be paid to Administrative Agent at its Principal Office
and upon receipt, Administrative Agent shall promptly distribute to each Lender
its Pro Rata Share thereof.

 

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(b) Borrower agrees to pay directly to Issuing Bank, for its own account, the
following fees:

(i) a fronting fee accruing at 0.25% per annum on the average aggregate daily
maximum amount available to be drawn under all Letters of Credit (determined as
of the close of business on any date of determination); and

(ii) such documentary and processing charges for any issuance, amendment,
transfer or payment of a Letter of Credit as are in accordance with Issuing
Bank’s standard schedule for such charges and as in effect at the time of such
issuance, amendment, transfer or payment, as the case may be.

(c) Borrower agrees to pay on the Third Restatement Date to Administrative
Agent, for the account of each Lender party to this Agreement as a Lender on
Third Restatement Date, as fee compensation for the funding of such Lender’s
Tranche B Term Loans, a closing fee in an amount equal to the percentage of the
stated principal amount of such Lender’s Tranche B Term Loans set forth in
Schedule 2.11(c) payable to such Lender from the proceeds of its Tranche B Term
Loan as and when funded on the Third Restatement Date. Such closing fee will be
in all respects fully earned, due and payable on the Third Restatement Date and
non-refundable and non-creditable thereafter.

(d) All fees referred to in Section 2.11(a) and 2.11(b)(i) shall be calculated
on the basis of a 360-day year and the actual number of days elapsed and shall
be payable quarterly in arrears on March 31, June 30, September 30 and
December 31 of each year during the Revolving Commitment Period, commencing on
March 31, 2012, and on the Revolving Commitment Termination Date.

(e) In addition to any of the foregoing fees, Borrower agrees to pay to Agents
such other fees in the amounts and at the times separately agreed upon.

2.12 Scheduled Payments/Commitment Reductions.

(a) Scheduled Installments. The principal amounts of the Tranche A Term Loans
and Tranche B Term Loans shall be repaid in consecutive quarterly installments
(each, an “Installment”) equal to the percentage set forth below of, initially,
an amount equal to the aggregate principal amount of Tranche A Term Loans and
Tranche B Term Loans outstanding on the Third Restatement Date on the four
quarterly scheduled Interest Payment Dates (each such date, an “Installment
Date”), commencing March 31, 2012:

 

Amortization Date

   Tranche A
Term Loan
Installments     Tranche B
Term Loan
Installments  

March 31, 2012

     1.25 %      —     

June 30, 2012

     1.25 %      0.25 % 

September 30, 2012

     1.25 %      0.25 % 

December 31, 2012

     1.25 %      0.25 % 

March 31, 2013

     2.5 %      0.25 % 

June 30, 2013

     2.5 %      0.25 % 

September 30, 2013

     2.5 %      0.25 % 

December 31, 2013

     2.5 %      0.25 % 

March 31, 2014

     5.0 %      0.25 % 

June 30, 2014

     5.0 %      0.25 % 

 

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Amortization Date

   Tranche A Term
Loan Installments   Tranche B Term
Loan Installments

September 30, 2014

   5.0%   0.25%

December 31, 2014

   5.0%   0.25%

March 31, 2015

   5.0%   0.25%

June 30, 2015

   5.0%   0.25%

September 30, 2015

   5.0%   0.25%

December 31, 2015

   5.0%   0.25%

March 31, 2016

   5.0%   0.25%

Tranche A Term Loan Maturity Date

   Remaining Balance   —  

June 30, 2016

   —     0.25%

September 30, 2016

   —     0.25%

December 31, 2016

   —     0.25%

March 31, 2017

   —     0.25%

June 30, 2017

   —     0.25%

September 30, 2017

   —     0.25%

December 31, 2017

   —     0.25%

March 31, 2018

   —     0.25%

June 30, 2018

   —     0.25%

September 30, 2018

   —     0.25%

December 31, 2018

   —     0.25%

Tranche B Term Loan Maturity Date

   —     Remaining Balance

Notwithstanding the foregoing, (x) such Installments shall be reduced in
connection with any voluntary or mandatory prepayments of the Tranche A Term
Loans and/or the Tranche B Term Loans as the case may be, in accordance with
Sections 2.13, 2.14 and 2.15, as applicable; and (y) the Tranche A Term Loans
and the Tranche B Term Loans, together with all other amounts owed hereunder
with respect thereto, shall, in any event, be paid in full no later than the
Tranche A Term Loan Maturity Date and the Tranche B Term Loan Maturity Date,
respectively.

2.13 Voluntary Prepayments/Commitment Reductions.

(a) Voluntary Prepayments.

(i) Any time and from time to time:

(A) with respect to Base Rate Loans, Borrower may prepay any such Loans on any
Business Day in whole or in part (in the case of a partial prepayment of Loans
borrowed in Dollars, in an aggregate minimum amount of $5,000,000 and integral
multiples of $1,000,000 in excess of that amount);

(B) with respect to Eurodollar Rate Loans, subject to Section 2.18(c), Borrower
may prepay any such Loans on any Business Day in whole or in part (in the case
of a partial prepayment, in an aggregate minimum amount of $5,000,000 and
integral multiples of $1,000,000 in excess of that amount); and

 

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(C) with respect to Swing Line Loans, Borrower may prepay any such Loans on any
Business Day in whole or in part (in the case of a partial prepayment, in an
aggregate minimum amount of $500,000, and in integral multiples of $100,000 in
excess of that amount).

(ii) All such prepayments shall be made:

(A) upon not less than one Business Day’s prior written or telephonic notice in
the case of Base Rate Loans;

(B) upon not less than three Business Days’ prior written or telephonic notice
in the case of Eurodollar Rate Loans; and

(C) upon written or telephonic notice on the date of prepayment, in the case of
Swing Line Loans;

in each case given to Administrative Agent or Swing Line Lender, as the case may
be, by 12:00 p.m. (New York City time) on the date required and, if given by
telephone, promptly confirmed by delivery of written notice thereof to
Administrative Agent (and Administrative Agent will promptly transmit such
original notice for Term Loans or Revolving Loans, as the case may be, by
telefacsimile or telephone to each Lender) or Swing Line Lender, as the case may
be. Upon the giving of any such notice, the principal amount of the Loans
specified in such notice shall become due and payable on the prepayment date
specified therein; provided that a notice of voluntary prepayment may state that
such notice is conditional upon the effectiveness of other credit facilities or
the receipt of the proceeds from the issuance of other Indebtedness or upon the
closing of an acquisition transaction, in which case such notice of prepayment
may be revoked by Borrower (by notice to Administrative Agent on or prior to the
specified date) if such condition is not satisfied. Any such voluntary
prepayment shall be applied as specified in Section 2.15(a).

Notwithstanding Section 2.13(a) above, in the event that on or prior to the
first anniversary of the Third Restatement Date, the Borrower (x) makes any
prepayment of Tranche B Term Loans in connection with any Repricing Transaction
or (y) effects any amendment of this Agreement resulting in a Repricing
Transaction, the Borrower shall pay to the Administrative Agent, for the ratable
account of each of the applicable Lenders, (I) in the case of clause (x) above,
a prepayment premium of 1% of the amount of the Tranche B Term Loans being
prepaid and (II) in the case of clause (y) above, a payment equal to 1% of the
aggregate amount of the applicable Tranche B Term Loans outstanding immediately
prior to such amendment.

(b) Voluntary Commitment Reductions.

(i) Borrower may, upon not less than three Business Days’ prior written or
telephonic notice promptly confirmed by delivery of written notice thereof to
Administrative Agent (which original written or telephonic notice Administrative
Agent will promptly transmit by telefacsimile or telephone to each applicable
Lender), at any time and from time to time terminate in whole or permanently
reduce in part, without premium or penalty, the Revolving Commitments in an
amount up to the amount by which the Revolving Commitments exceed the Total
Utilization of Revolving Commitments at the time of such proposed termination or
reduction; provided that any such partial reduction of the Revolving Commitments
shall be in an aggregate minimum amount of $5,000,000 and integral multiples of
$1,000,000 in excess of that amount.

(ii) Borrower’s notice to Administrative Agent shall designate the date (which
shall be a Business Day) of such termination or reduction and the amount of any
partial reduction, and such termination or reduction of the Revolving
Commitments shall be effective on the date specified in Borrower’s

 

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notice and shall reduce the Revolving Commitment of each Lender proportionately
to its Pro Rata Share thereof; provided that a notice of termination or partial
reduction may state that such notice is conditional upon the effectiveness of
other credit facilities or the receipt of the proceeds from the issuance of
other Indebtedness or upon the closing of an acquisition transaction, in which
case such notice of termination or partial reduction may be revoked by Borrower
(by notice to the Administrative Agent on or prior to the specified date) if
such condition is not satisfied.

2.14 Mandatory Prepayments.

(a) Asset Sales. No later than three Business Days following the date of receipt
by Borrower or any of its Subsidiaries of any Net Asset Sale Proceeds, Borrower
shall prepay the Loans as set forth in Section 2.15(b) in an aggregate amount
equal to such Net Asset Sale Proceeds; provided that so long as no Event of
Default shall have occurred and be continuing, Borrower or any of its
Subsidiaries may invest an amount equal to all or any portion of such Net Asset
Sale Proceeds received from Asset Sales of assets within 365 days of receipt
thereof in real estate, equipment and other tangible assets, Intellectual
Property or Intellectual Property licenses useful in the business of Borrower
and its Subsidiaries (or any similar or related or ancillary business), in which
case the amount of Net Asset Sale Proceeds so invested shall not be required to
be applied to prepay the Loans pursuant to this Section 2.14(a).

(b) Insurance/Condemnation Proceeds. No later than three Business Days following
the date of receipt by Borrower or any of its Subsidiaries, or Administrative
Agent as loss payee, of any Net Insurance/Condemnation Proceeds in excess of
$25,000,000 in the aggregate in any Fiscal Year, Borrower shall prepay the Loans
as set forth in Section 2.15(b) in an aggregate amount equal to such Net
Insurance/Condemnation Proceeds; provided that, so long as no Event of Default
shall have occurred and be continuing, Borrower or any of its Subsidiaries may
invest an amount equal to all or any portion of such Net Insurance/Condemnation
Proceeds within 365 days of receipt thereof in real estate, equipment and other
tangible assets useful in the business of Borrower and its Subsidiaries (or any
similar or related or ancillary business), which investment may include the
repair, restoration or replacement of the applicable assets thereof, in which
case the amount of Net Insurance/Condemnation Proceeds so invested shall not be
required to be applied to prepay the Loans pursuant to this Section 2.14(b).

(c) Issuance of Equity Securities. No later than three Business Days following
the date of receipt by Borrower or any of its Subsidiaries of any Cash proceeds
from a capital contribution to, or the issuance of any Equity Interests of,
Borrower or any of its Subsidiaries (other than (i) pursuant to any employee
stock or stock option compensation plan or any employment agreement, (ii) the
receipt of a capital contribution from, or the issuance of Equity Interests to,
Borrower or any of its Subsidiaries and (iii) the issuance of directors’
qualifying shares or of other nominal amounts of other Equity Interests that are
required to be held by specified Persons under Applicable Law), Borrower shall
prepay the Loans as set forth in Section 2.15(b) in an aggregate amount equal to
50% of such proceeds, in each case, net of underwriting discounts and
commissions and other reasonable costs and expenses associated therewith,
including reasonable legal fees and expenses; provided that if, as of the end of
the most recent four consecutive Fiscal Quarter period (determined for any such
period by reference to the Compliance Certificate delivered pursuant to
Section 5.1(c) calculating the Leverage Ratio as of the last day of such four
consecutive Fiscal Quarter period), the Leverage Ratio determined on a Pro Forma
Basis shall be 3.25:1.00 or less, Borrower shall only be required to make
prepayments otherwise required hereby in an amount equal to 25% of such
proceeds.

(d) Issuance of Debt. No later than two Business Days following the date of
receipt by Borrower or any of its Subsidiaries of any Cash proceeds from the
incurrence of any Indebtedness of Borrower or any of its Subsidiaries (other
than with respect to any Indebtedness permitted to be incurred pursuant to
Section 6.1), Borrower shall prepay the Loans as set forth in Section 2.15(b) in
an aggregate amount equal to 100% of such proceeds, net of underwriting
discounts and commissions and other reasonable costs and expenses associated
therewith, including reasonable legal fees and expenses.

 

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(e) Consolidated Excess Cash Flow. In the event that there shall be Consolidated
Excess Cash Flow for any Fiscal Year (commencing with Fiscal Year 2012),
Borrower shall, no later than ninety days after the end of such Fiscal Year,
prepay the Loans as set forth in Section 2.15(b) in an aggregate amount equal to
(i) 50% of such Consolidated Excess Cash Flow; provided that if, as of the last
day of the most recently ended Fiscal Year the Leverage Ratio (determined for
any such period by reference to the Compliance Certificate delivered pursuant to
Section 5.1(c) calculating the Leverage Ratio as of the last day of such Fiscal
Year) shall be (x) 3.25:1.00 or less, Borrower shall only be required to make
the prepayments otherwise required hereby in an amount equal to 25% of such
Consolidated Excess Cash Flow or (y) 2.50:1.00 or less, Borrower shall not be
required to make prepayments pursuant to this Section 2.14(e) with respect to
such Fiscal Year; minus (ii) voluntary repayments of the Loans (excluding
repayments of Revolving Loans or Swing Line Loans except to the extent the
Revolving Commitments are permanently reduced in connection with such
repayments) made with Internally Generated Cash.

(f) Revolving Loans and Swing Line Loans. (i) Borrower shall from time to time
prepay first, the Swing Line Loans, and second, the Revolving Loans to the
extent necessary so that the Total Utilization of Revolving Commitments shall
not at any time exceed the Revolving Commitments then in effect.

(g) Prepayment Certificate. Concurrently with any prepayment of the Loans
pursuant to Sections 2.14(a) through 2.14(e), Borrower shall deliver to
Administrative Agent a certificate of an Authorized Officer demonstrating the
calculation of the amount of the applicable net proceeds or Consolidated Excess
Cash Flow, as the case may be. In the event that Borrower shall subsequently
determine that the actual amount received exceeded the amount set forth in such
certificate, Borrower shall promptly make an additional prepayment of the Loans
in an amount equal to such excess, and Borrower shall concurrently therewith
deliver to Administrative Agent a certificate of an Authorized Officer
demonstrating the derivation of such excess.

2.15 Application of Prepayments.

(a) Application of Voluntary Prepayments by Type of Loans. Any prepayment of any
Loan pursuant to Section 2.13(a) shall be applied as specified by Borrower in
the applicable notice of prepayment; provided that, in the event Borrower fails
to specify the Loans to which any such prepayment shall be applied, such
prepayment shall be applied as follows:

first, to repay outstanding Swing Line Loans to the full extent thereof;

second, to repay outstanding Revolving Loans to the full extent thereof; and

third, to prepay the Term Loans on a pro rata basis (in accordance with the
respective outstanding principal amounts thereof); and further applied on a pro
rata basis to reduce the remaining scheduled Installments of principal of the
Tranche A Term Loans, Tranche B Term Loans and the New Term Loans (if any).

(b) Application of Mandatory Prepayments by Type of Loans. Any amount required
to be paid pursuant to Sections 2.14(a) through 2.14(e) shall be applied as
follows:

first, to prepay Term Loans on a pro rata basis (in accordance with the
respective outstanding principal amounts thereof) and further applied on a pro
rata basis to reduce the remaining scheduled Installments of principal of the
Tranche A Term Loans, Tranche B Term Loans and the New Term Loans (if any);

 

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second, to prepay the Swing Line Loans to the full extent thereof;

third, to prepay the Revolving Loans to the full extent thereof;

fourth, to prepay outstanding reimbursement obligations with respect to Letters
of Credit;

fifth, to cash collateralize Letters of Credit; and

sixth, to Borrower.

(c) Application of Prepayments of Loans to Base Rate Loans and Eurodollar Rate
Loans. Considering each Class of Loans being prepaid separately, any prepayment
thereof shall be applied, as between the Base Rate Loans and the Eurodollar Rate
Loans, as directed by Borrower.

(d) Waivable Mandatory Prepayment. Anything contained herein to the contrary
notwithstanding, so long as any Tranche A Term Loans are outstanding, in the
event Borrower is required to make any mandatory prepayment (a “Waivable
Mandatory Prepayment”) of the Tranche B Term Loans, not less than five Business
Days prior to the date (the “Required Prepayment Date”) on which Borrower is
required to make such Waivable Mandatory Prepayment, Borrower shall notify
Administrative Agent of the amount of such prepayment, and Administrative Agent
will promptly thereafter notify each Lender holding an outstanding Tranche B
Term Loan of the amount of such Lender’s Pro Rata Share of such Waivable
Mandatory Prepayment and such Lender’s option to refuse such amount. Each such
Lender may exercise such option by giving written notice to Borrower and
Administrative Agent of its election to do so on or before the third Business
Day prior to the Required Prepayment Date (it being understood that any Lender
which does not notify Borrower and Administrative Agent of its election to
exercise such option on or before the third Business Day prior to the Required
Prepayment Date shall be deemed to have elected, as of such date, not to
exercise such option). On the Required Prepayment Date, Borrower shall pay to
Administrative Agent the amount of the Waivable Mandatory Prepayment, which
amount shall be applied (i) in an amount equal to that portion of the Waivable
Mandatory Prepayment payable to those Lenders that have elected not to exercise
such option, to prepay the Tranche B Term Loans of such Lenders (which
prepayment shall be applied to the scheduled Installments of principal of the
Tranche B Term Loans in accordance with Section 2.15(b)), and (ii) in an amount
equal to that portion of the Waivable Mandatory Prepayment otherwise payable to
those Lenders that have elected to exercise such option, to prepay the Tranche A
Term Loans (which prepayment shall be further applied to the scheduled
installments of principal of the Tranche A Term Loans in accordance with
Section 2.15(b)), with any excess after such prepayment of the Tranche A Term
Loans being further applied in accordance with clauses second through sixth of
Section 2.15(b).

2.16 General Provisions Regarding Payments.

(a) All payments by Borrower of principal, interest, fees and other Obligations
shall be made in Dollars in same day funds, without defense, recoupment, set-off
or counterclaim, free of any restriction or condition, and delivered to
Administrative Agent not later than (x) 12:00 p.m. (New York City time) on the
date due at the Principal Office designated by Administrative Agent for the
account of Lenders; for purposes of computing interest and fees, funds received
by Administrative Agent after that time on such due date shall be deemed to have
been paid by Borrower on the next succeeding Business Day.

 

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(b) All payments in respect of the principal amount of any Loan (other than
voluntary prepayments of Revolving Loans that are Base Rate Loans) shall be
accompanied by payment of accrued interest on the principal amount being repaid
or prepaid, and all such payments (and, in any event, any payments in respect of
any Loan on a date when interest is due and payable with respect to such Loan)
shall be applied to the payment of interest then due and payable before
application to principal.

(c) Administrative Agent (or its agent or sub-agent appointed by it) shall
promptly distribute to each Lender at such address as such Lender shall indicate
in writing, such Lender’s applicable Pro Rata Share of all payments and
prepayments of principal and interest due hereunder, together with all other
amounts due thereto, including, all fees payable with respect thereto, to the
extent received by Administrative Agent.

(d) Notwithstanding the foregoing provisions hereof, if any
Conversion/Continuation Notice is withdrawn as to any Affected Lender or if any
Affected Lender makes Base Rate Loans in lieu of its Pro Rata Share of any
Eurodollar Rate Loans, Administrative Agent shall give effect thereto in
apportioning payments received thereafter.

(e) Subject to the provisos set forth in the definition of “Interest Period” as
they may apply to Revolving Loans, whenever any payment to be made hereunder
with respect to any Loan shall be stated to be due on a day that is not a
Business Day, such payment shall be made on the next succeeding Business Day
and, with respect to Revolving Loans only, such extension of time shall be
included in the computation of the payment of interest hereunder or of the
Revolving Commitment fees hereunder.

(f) Except as otherwise expressly provided herein, all payments by Borrower
hereunder shall be made to Administrative Agent, for the account of the
respective Lenders to which such payment is owed, in Dollars and otherwise in
the manner set forth in clause (a) of this Section 2.16.

(g) Administrative Agent shall deem any payment by or on behalf of Borrower
hereunder that is not made in same day funds prior to 12:00 p.m. (New York City
time) to be a non-conforming payment. Any such payment shall not be deemed to
have been received by Administrative Agent until the later of (i) the time such
funds become available funds, and (ii) the next succeeding Business Day.
Administrative Agent shall give prompt telephonic notice to Borrower and each
applicable Lender (confirmed in writing) if any payment is non-conforming. Any
non-conforming payment may constitute or become a Default or Event of Default in
accordance with the terms of Section 8.1(a). Interest shall continue to accrue
on any principal as to which a non-conforming payment is made until such funds
become available funds (but in no event less than the period from the date of
such payment to the next succeeding applicable Business Day) at the rate
determined pursuant to Section 2.10 from the date such amount was due and
payable until the date such amount is paid in full.

(h) If an Event of Default shall have occurred and not otherwise been waived,
and the maturity of the Obligations shall have been accelerated pursuant to
Section 8.1, all payments or proceeds received by Agents hereunder in respect of
any of the Obligations, shall be applied in accordance with the application
arrangements described in Section 9.2 of the Second Amended and Restated Pledge
and Security Agreement and the analogous sections of any other Collateral
Documents.

2.17 Ratable Sharing. Lenders hereby agree among themselves that, except as
otherwise provided in the Collateral Documents with respect to amounts realized
from the exercise of rights with respect to Liens on the Collateral, if any of
them shall, whether by voluntary payment (other than a voluntary prepayment of
Loans made and applied in accordance with the terms hereof), through the
exercise of any right of set-off, consolidation or banker’s lien, by
counterclaim or cross action or by the enforcement of any right under the Credit
Documents or otherwise, or as adequate protection of a deposit treated as

 

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cash collateral under any Insolvency Laws, receive payment or reduction of a
proportion of the aggregate amount of principal, interest, amounts payable in
respect of Letters of Credit, fees and other amounts then due and owing to such
Lender hereunder or under the other Credit Documents (collectively, the
“Aggregate Amounts Due” to such Lender) which is greater than the proportion
received by any other Lender in respect of the Aggregate Amounts Due to such
other Lender, then the Lender receiving such proportionately greater payment
shall (a) notify Administrative Agent and each other Lender of the receipt of
such payment and (b) apply a portion of such payment to purchase participations
(which it shall be deemed to have purchased from each seller of a participation
simultaneously upon the receipt by such seller of its portion of such payment)
in the Aggregate Amounts Due to the other Lenders so that all such recoveries of
Aggregate Amounts Due shall be shared by all Lenders in proportion to the
Aggregate Amounts Due to them; provided that, if all or part of such
proportionately greater payment received by such purchasing Lender is thereafter
recovered from such Lender upon the bankruptcy or reorganization of Borrower or
otherwise, those purchases shall be rescinded and the purchase prices paid for
such participations shall be returned to such purchasing Lender ratably to the
extent of such recovery, but without interest. Borrower expressly consents to
the foregoing arrangement and agrees that any holder of a participation so
purchased may exercise any and all rights of banker’s lien, consolidation,
set-off or counterclaim with respect to any and all monies owing by Borrower to
that holder with respect thereto as fully as if that holder were owed the amount
of the participation held by that holder. The provisions of this Section 2.17
shall not be construed to apply to (a) any payment made by Borrower pursuant to
and in accordance with the express terms of this Agreement or (b) any payment
obtained by any Lender as consideration for the assignment or sale of a
participation in any of its Loans or other Obligations owed to it in accordance
herewith.

2.18 Making or Maintaining Eurodollar Rate Loans.

(a) Inability to Determine Applicable Interest Rate. In the event that
Administrative Agent shall have determined (which determination shall be final
and conclusive and binding upon all parties hereto absent manifest error), on
any Interest Rate Determination Date with respect to any Eurodollar Rate Loans,
that by reason of circumstances affecting the London interbank market, adequate
and fair means do not exist for ascertaining the interest rate applicable to
such Loans on the basis provided for in the definition of Adjusted Eurodollar
Rate for any requested Interest Period with respect to a proposed Eurodollar
Rate Loan does not adequately and fairly reflect the cost to such Lenders of
funding such Loan, Administrative Agent shall on such date give notice (by email
or by telephone confirmed in writing) to Borrower and each Lender of such
determination, whereupon (i) no Loans may be made as, or converted to,
Eurodollar Rate Loans until such time as Administrative Agent notifies Borrower
and Lenders that the circumstances giving rise to such notice no longer exist,
and (ii) any Funding Notice or Conversion/Continuation Notice given by Borrower
with respect to the Loans in respect of which such determination was made shall
be deemed to be rescinded by Borrower.

(b) Illegality or Impracticability of Eurodollar Rate Loans. In the event that
on any date any Lender shall have determined (which determination shall be final
and conclusive and binding upon all parties hereto absent manifest error) that
the making, maintaining or continuation of its Eurodollar Rate Loans (i) has
become unlawful as a result of compliance by such Lender in good faith with any
law, treaty, governmental rule, regulation, guideline or order (or would
conflict with any such treaty, governmental rule, regulation, guideline or order
not having the force of law even though the failure to comply therewith would
not be unlawful), or (ii) has become impracticable, as a result of contingencies
occurring after the date hereof which materially and adversely affect the London
interbank market or the position of such Lender in that market, then, and in any
such event, such Lender shall be an “Affected Lender” and it shall on that day
give notice (by email or by telephone confirmed in writing) to Borrower and
Administrative Agent of such determination (which notice Administrative Agent
shall promptly transmit to each other Lender). If the Administrative Agent
receives a notice from (x) any Lender pursuant to clause (i) of

 

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the preceding sentence or (y) a notice from Lenders constituting Requisite
Lenders pursuant to clause (ii) of the preceding sentence, then (1) the
obligation of the Lenders (or, in the case of any notice pursuant to clause
(i) of the preceding sentence, such Lender) to make Loans as, or to convert
Loans to, Eurodollar Rate Loans shall be suspended until such notice shall be
withdrawn by each Affected Lender, (2) to the extent such determination by the
Affected Lender relates to a Eurodollar Rate Loan then being requested by
Borrower pursuant to a Funding Notice or a Conversion/Continuation Notice,
Lenders (or in the case of any notice pursuant to clause (i) of the preceding
sentence, such Lender) shall make such Loan as (or continue such Loan as or
convert such Loan to, as the case may be) a Base Rate Loan, (3) the Lenders’ (or
in the case of any notice pursuant to clause (i) of the preceding sentence, such
Lender’s) obligations to maintain their respective outstanding Eurodollar Rate
Loans (the “Affected Loans”), shall be terminated at the earlier to occur of the
expiration of the Interest Period then in effect with respect to the Affected
Loans or when required by law, and (4) the Affected Loans shall automatically
convert into Base Rate Loans on the date of such termination. Notwithstanding
anything herein to the contrary, to the extent a determination by an Affected
Lender as described above relates to a Eurodollar Rate Loan then being requested
by Borrower pursuant to a Funding Notice or a Conversion/Continuation Notice,
Borrower shall have the option, subject to the provisions of Section 2.18(c), to
rescind such Funding Notice or Conversion/Continuation Notice as to all Lenders
by giving written or telephonic notice (promptly confirmed by delivery of
written notice thereof) to Administrative Agent of such rescission on the date
on which the Affected Lender gives notice of its determination as described
above (which notice of rescission Administrative Agent shall promptly transmit
to each other Lender).

(c) Compensation for Breakage or Non-Commencement of Interest Periods. Borrower
shall compensate each Lender, as promptly as practicable after written request
by such Lender (which request shall set forth the basis for requesting such
amounts and shall be conclusive absent manifest error), for all reasonable
losses, expenses and liabilities (including any interest paid or calculated to
be due and payable by such Lender to lenders of funds borrowed by it to make or
carry its Eurodollar Rate Loans and any loss, expense or liability sustained by
such Lender in connection with the liquidation or deployment of such funds but
excluding loss of anticipated profits) which such Lender may sustain: (i) if for
any reason (other than a default by such Lender) a borrowing of any Eurodollar
Rate Loan does not occur on a date specified therefor in a Funding Notice or a
telephonic request for borrowing, or a conversion to or continuation of any
Eurodollar Rate Loan does not occur on a date specified therefor in a
Conversion/Continuation Notice or a telephonic request for conversion or
continuation; (ii) if any prepayment or other principal payment of, or any
conversion of, any of its Eurodollar Rate Loans occurs on a date prior to the
last day of an Interest Period applicable to that Loan; or (iii) if any
prepayment of any of its Eurodollar Rate Loans is not made on any date specified
in a notice of prepayment given by Borrower.

(d) Booking of Eurodollar Rate Loans. Any Lender may make, carry or transfer
Eurodollar Rate Loans at, to, or for the account of any of its branch offices or
the office of an Affiliate of such Lender.

(e) Assumptions Concerning Funding of Eurodollar Rate Loans. Calculation of all
amounts payable to a Lender under this Section 2.18 and under Section 2.19 shall
be made as though such Lender had actually funded each of its relevant
Eurodollar Rate Loans a matching deposit or other borrowing in the offshore
interbank market for such currency for a comparable amount and for a comparable
period through the transfer of such matching deposit or other borrowing from an
offshore office of such Lender to a domestic office of such Lender in the United
States of America; provided, however, each Lender may fund each of its
Eurodollar Rate Loans in any manner it sees fit and the foregoing assumptions
shall be utilized only for the purposes of calculating amounts payable under
this Section 2.18 and under Section 2.19.

 

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2.19 Increased Costs; Capital Adequacy.

(a) Compensation for Increased Costs and Taxes. In the event that any Lender
(which term shall include Issuing Bank for purposes of this Section 2.19(a))
shall reasonably determine (which determination shall, absent manifest error, be
final and conclusive and binding upon all parties hereto) that any Applicable
Law, or any change therein or in the interpretation, administration or
application thereof (including the introduction of any new Applicable Law), or
any determination of any Governmental Authority, in each case that becomes
effective after the date hereof, or compliance by such Lender with any
guideline, request or directive issued or made after the date hereof by any
Governmental Authority (whether or not having the force of law): (i) subjects
such Lender (or its applicable lending office) to any additional Tax (other than
any Excluded Taxes (including any change in the rate of Excluded Taxes),
Indemnified Taxes or Other Taxes indemnified under Section 2.20) with respect to
this Agreement or any of the other Credit Documents or any of its obligations
hereunder or thereunder or any payments to such Lender (or its applicable
lending office) of principal, interest, fees or any other amount payable
hereunder; (ii) imposes, modifies or holds applicable any reserve (including any
marginal, emergency, supplemental, special or other reserve), special deposit,
compulsory loan, FDIC insurance or similar requirement against assets held by,
or deposits or other liabilities in or for the account of, or advances or loans
by, or other credit extended by, or any other acquisition of funds by, any
office of such Lender (other than any such reserve or other requirements with
respect to Eurodollar Rate Loans that are reflected in the definition of
“Adjusted Eurodollar Rate”); or (iii) imposes any other condition, cost or
expense (other than with respect to a Tax matter) on or affecting such Lender
(or its applicable lending office) or its obligations hereunder or the London
interbank market and the result of any of the foregoing is to increase the cost
to such Lender of agreeing to make, making or maintaining Loans hereunder or to
reduce any amount received or receivable by such Lender (or its applicable
lending office) with respect thereto; 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 regulatory authorities, in each case pursuant to Basel III, shall
in each case be deemed a change of law, regardless of the date enacted, adopted
or issued; then, in any such case, Borrower shall pay to such Lender, as
promptly as practicable after receipt of the statement referred to in the next
sentence, such additional amount or amounts (in the form of an increased rate
of, or a different method of calculating, interest or otherwise as such Lender
in its sole discretion shall determine) as may be necessary to compensate such
Lender for any such increased cost or reduction in amounts received or
receivable hereunder. Such Lender shall deliver to Borrower (with a copy to
Administrative Agent) a written statement, setting forth in reasonable detail
the basis for calculating the additional amounts owed to such Lender under this
Section 2.19(a), which statement shall be conclusive and binding upon all
parties hereto absent manifest error.

(b) Capital Adequacy Adjustment. In the event that any Lender (which term shall
include Issuing Bank for purposes of this Section 2.19(b)) shall have reasonably
determined that the adoption, effectiveness, phase in or applicability after the
Third Restatement Date of any Applicable Law regarding capital or liquidity
adequacy, reserve requirements or similar requirements, or any change therein or
in the interpretation, application or administration thereof by any Governmental
Authority, central bank or comparable agency charged with the interpretation or
administration thereof, or compliance by any Lender (or its applicable lending
office) with any Applicable Law regarding capital or liquidity adequacy, reserve
requirements or similar requirements (whether or not having the force of law) of
any such Governmental Authority, has or would have the effect of reducing the
rate of return on the capital of such Lender or any corporation controlling such
Lender as a consequence of, or with reference to, such Lender’s Loans or
Revolving Commitments or Letters of Credit, or participations therein or other
obligations hereunder with respect to the Loans or the Letters of Credit to a
level below that which such Lender or such

 

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controlling corporation could have achieved but for such adoption,
effectiveness, phase in, applicability, change or compliance (taking into
consideration the policies of such Lender or such controlling corporation with
regard to capital adequacy); 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
regulatory authorities, in each case pursuant to Basel III, shall in each case
be deemed a change of law, regardless of the date enacted, adopted or issued,
then from time to time, within five Business Days after receipt by Borrower from
such Lender of the statement referred to in the next sentence, Borrower shall
pay to such Lender such additional amount or amounts as will compensate such
Lender or such controlling corporation on an after tax basis for such reduction.
Such Lender shall deliver to Borrower (with a copy to Administrative Agent) a
written statement, setting forth in reasonable detail the basis for calculating
the additional amounts owed to Lender under this Section 2.19(b), which
statement shall be conclusive and binding upon all parties hereto absent
manifest error.

2.20 Taxes; Withholding, etc.

(a) Payments to Be Free and Clear. All sums payable by or on behalf of any
Credit Party hereunder and under the other Credit Documents shall (except to the
extent required by law) be paid free and clear of, and without any deduction or
withholding on account of, any Tax.

(b) Withholding of Taxes. If any Credit Party or any other applicable
withholding agent is required by law to make any deduction or withholding on
account of any Indemnified Taxes or Other Taxes from any sum paid or payable by
any Credit Party to any Agent or any Lender (which term shall include each Swing
Line Lender and Issuing Bank for purposes of this Section 2.20) under any of the
Credit Documents: (i) Borrower shall notify Administrative Agent of any such
requirement or any change in any such requirement as soon as Borrower becomes
aware of it; (ii) the applicable withholding agent shall make such deduction or
withholding and pay such Indemnified Taxes or Other Taxes before the date on
which penalties attach thereto, such payment to be made (if the liability to pay
is imposed on any Credit Party) for its own account or (if that liability is
imposed on Administrative Agent or such Lender, as the case may be) on behalf of
and in the name of Administrative Agent or such Lender; (iii) the sum payable by
the Credit Party in respect of which the relevant deduction, withholding or
payment is required shall be increased to the extent necessary to ensure that,
after the making of that deduction, withholding or payment (including any
deduction, withholding or payment applicable to additional amounts payable under
this Section 2.20), Administrative Agent or such Lender, as the case may be,
receives on the due date a net sum equal to what it would have received had no
such deduction, withholding or payment been required or made; and (iv) within
thirty days after paying any sum from which it is required by law to make any
deduction or withholding, and within thirty days after the due date of payment
of any Indemnified Taxes or Other Taxes which it is required by clause
(ii) above to pay, Borrower (if Borrower is the withholding agent) shall deliver
to Administrative Agent evidence reasonably satisfactory to the other affected
parties of such deduction, withholding or payment and of the remittance thereof
to the relevant taxing or other authority.

(c) Borrower agrees to indemnify each Agent and each Lender for (i) the full
amount of Indemnified Taxes and Other Taxes (including any Indemnified Taxes or
Other Taxes attributable to any amounts payable under this Section 2.20) payable
by such Agent or such Lender (whether or not such Taxes are correctly or legally
imposed) and (ii) any reasonable expenses arising therefrom or with respect
thereto. A certificate from the relevant Lender or Agent, setting forth in
reasonable detail the basis and calculation of such Taxes shall be conclusive,
absent manifest error.

 

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(d) Evidence of Exemption from Withholding Tax. Each Lender shall, at such times
as are reasonably requested by Borrower or the Administrative Agent, provide
Borrower and the Administrative Agent with any documentation prescribed by law
or reasonably requested by Borrower or Administrative Agent certifying as to any
entitlement of such Lender to an exemption from, or reduction in, withholding
tax with respect to any payments to be made to such Lender under the Credit
Documents. Each Lender shall, whenever a lapse in time or change in such
Lender’s circumstances renders such documentation obsolete, expired or
inaccurate in any material respect, deliver promptly to Borrower and the
Administrative Agent updated or other appropriate documentation (including any
new documentation reasonably requested by the applicable withholding agent) or
promptly notify Borrower and the Administrative Agent of its inability to do so.

Notwithstanding anything to the contrary, a Lender shall be required to provide
any documentation under this Section 2.20(d) only to the extent it is legally
eligible to do so.

(e) Payment of Taxes. In addition, Borrower agrees to pay any present or future
stamp, court or documentary, intangible, recording, filing or similar Taxes
imposed by any Governmental Authority, which arise from any payment made under
any Credit Document or from the execution, delivery, performance, enforcement or
registration of, or otherwise with respect to, any Credit Document (“Other
Taxes”).

(f) Treatment of Certain Refunds. If any party determines, in its sole
discretion exercised in good faith, that it has received a refund of any Taxes
(whether received in cash or applied by the taxing authority granting the refund
to offset another Taxes otherwise owed) as to which it has been indemnified
pursuant to this Section 2.20 (including additional amounts paid pursuant to
this Section 2.20), it shall pay to the indemnifying party an amount equal to
such refund (but only to the extent of indemnity payments made under this
Section with respect to the Taxes giving rise to such refund), net of all
out-of-pocket expenses (including any 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 to such indemnified party pursuant to the previous sentence (plus
any penalties, interest or other charges imposed by the relevant Governmental
Authority) in the event such indemnified party is required to repay such refund
to such Governmental Authority. Notwithstanding anything to the contrary in this
Section 2.20(f), in no event will any indemnified party be required to pay any
amount to any indemnifying party pursuant to this Section 2.20(f) if such
payment would place such indemnified party in a less favorable position (on a
net after-Tax basis) than such indemnified party would have been in if the
indemnification payments or additional amounts giving rise to such refund had
never been paid. This Section 2.20(f) shall not be construed to require any
indemnified party to make available its Tax returns (or any other information
relating to its Taxes which it deems confidential) to the indemnifying party or
any other Person.

(g) Minimum Interest. As part of entering into this Agreement, the parties
hereto have assumed that the interest payable at the rates set forth in this
Agreement is not and will not become subject to Swiss Federal Withholding Tax.
Notwithstanding the foregoing, the parties hereto agree that in the event that
(A) Swiss Federal Withholding Tax is due on interest payments or other payments
by any Credit Party under this Agreement and (B) Section 2.20(b) (Withholding of
Taxes) is unenforceable for any reason:

(x) the applicable interest rate in relation to that interest payment shall be
(i) the interest rate which would have applied to that interest payment as
provided for in Section 2.8 divided by (ii) 1 minus the rate at which the
relevant Swiss Federal Withholding Tax deduction is required to be made under
Swiss domestic tax law and / or applicable double taxation treaties (where the
rate at which the relevant Swiss Federal Withholding Tax deduction is required
to be made is for this purpose expressed as a fraction of 1); and

 

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(y) the Credit Party shall (i) pay the relevant interest at the adjusted rate in
accordance with paragraph (x) above, (ii) make the Swiss Federal Withholding Tax
deduction on the interest so recalculated and (iii) all references to a rate of
interest under the Agreement shall be construed accordingly.

To the extent that interest payable by any Credit Party under this Agreement
becomes subject to Swiss Federal Withholding Tax, the parties shall promptly
co-operate in completing any procedural formalities (including submitting forms
and documents required by the Swiss or foreign tax authorities) to the extent
possible and necessary for the Credit Party to obtain the tax ruling from the
Swiss Federal Tax Administration.

Section 2.20(f) equally applies to this Section 2.20(g).

2.21 Obligation to Mitigate. Each Lender (which term shall include Issuing Bank
for purposes of this Section 2.21) agrees that, as promptly as practicable after
the officer of such Lender responsible for administering its Loans or Letters of
Credit, as the case may be, becomes aware of the occurrence of an event or the
existence of a condition that would cause such Lender to become an Affected
Lender or that would entitle such Lender to receive payments under Section 2.18,
2.19 or 2.20, it will, to the extent not inconsistent with the internal policies
of such Lender and any applicable legal or regulatory restrictions, use
reasonable efforts to (a) make, issue, fund or maintain its Credit Extensions,
including any Affected Loans, through another office of such Lender, or (b) take
such other measures as such Lender may deem reasonable, if as a result thereof
the circumstances which would cause such Lender to be an Affected Lender would
cease to exist or the additional amounts which would otherwise be required to be
paid to such Lender pursuant to Section 2.18, 2.19 or 2.20 would be materially
reduced and if, as determined by such Lender in its sole discretion, the making,
issuing, funding or maintaining of such Revolving Commitments, Loans or Letters
of Credit through such other office or in accordance with such other measures,
as the case may be, would not otherwise adversely affect such Revolving
Commitments, Loans or Letters of Credit or the interests of such Lender;
provided, such Lender will not be obligated to utilize such other office or take
such other measures pursuant to this Section 2.21 unless Borrower agrees to pay
all reasonable incremental expenses incurred by such Lender as a result of
utilizing such other office or take such other measures as described above. A
certificate as to the amount of any such expenses payable by Borrower pursuant
to this Section 2.21 (setting forth in reasonable detail the basis for
requesting such amount) submitted by such Lender to Borrower (with a copy to
Administrative Agent) shall be conclusive absent manifest error.

2.22 Defaulting Lenders. Anything contained herein to the contrary
notwithstanding, in the event that any Lender becomes a Defaulting Lender, then
during any Default Period with respect to such Defaulting Lender, such
Defaulting Lender shall be deemed not to be a “Lender” for purposes of any
amendment, waiver or consent with respect to any provision of the Credit
Documents that requires the approval of Requisite Lenders, and Borrower shall
pay to Administrative Agent such additional amounts of cash as reasonably
requested by the Issuing Bank or the Swing Line Lender to be held as security
for Borrower’s reimbursement Obligations in respect of Letters of Credit and
Swing Line Loans then outstanding (such amount not to exceed such Defaulting
Lender’s obligations under Sections 2.3 and 2.4). During any Default Period with
respect to a Funds Defaulting Lender that is not also an Insolvency Defaulting
Lender, (a) any amounts that would otherwise be payable to such Funds Defaulting
Lender with respect to its Revolving Loans and Revolving Commitments under the
Credit Documents (including, without limitation, voluntary and mandatory
prepayments and fees) shall, in lieu of being distributed to such Funds
Defaulting Lender, be retained by Administrative Agent and applied in the
following order of

 

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priority: first, to the payment of any amounts owing by such Funds Defaulting
Lender to Administrative Agent, second, to the payment of any amounts owing by
such Funds Defaulting Lender to the Swing Line Lender, third, to the payment of
any amounts owing by such Funds Defaulting Lender to the Issuing Bank, and
fourth, to the payment of the Revolving Loans of other Lenders (but not to the
Revolving Loans of such Funds Defaulting Lender) as if such Funds Defaulting
Lender had funded all Defaulted Loans of such Funds Defaulting Lender; and
(b) the Total Utilization of Revolving Commitments as at any date of
determination shall be calculated as if such Defaulting Lender had funded all
Defaulted Loans of such Defaulting Lender. During any Default Period with
respect to an Insolvency Defaulting Lender, any amounts that would otherwise be
payable to such Insolvency Defaulting Lender under the Credit Documents
(including, without limitation, voluntary and mandatory prepayments and fees
including fees payable under Section 2.11) may, in lieu of being distributed to
such Insolvency Defaulting Lender, be retained by Administrative Agent to
collateralize indemnification and reimbursement obligations of such Insolvency
Defaulting Lender in an amount reasonably determined by Administrative Agent. No
Revolving Commitment of any Lender shall be increased or otherwise affected,
and, except as otherwise expressly provided in this Section 2.22, performance by
Borrower of its obligations hereunder and the other Credit Documents shall not
be excused or otherwise modified as a result of any Lender becoming a Defaulting
Lender or the operation of this Section 2.22. The rights and remedies against a
Defaulting Lender under this Section 2.22 are in addition to other rights and
remedies which Borrower may have against such Defaulting Lender as a result of
it becoming a Defaulting Lender and which Administrative Agent or any Lender may
have against such Defaulting Lender with respect thereto. If any Letter of
Credit Usage exists at the time such Lender becomes a Defaulting Lender then all
or any part of such Letter of Credit Usage shall be reallocated among the
non-Defaulting Lenders in accordance with their respective Pro Rata Share but
only to the extent (x) the sum of each non-Defaulting Lender’s Revolving
Exposures plus such Defaulting Lender’s Letter of Credit Usage does not exceed
the total of such non-Defaulting Lender’s Revolving Commitments and (y) no
Default or Event of Default exists or shall have occurred.

2.23 Removal or Replacement of a Lender. Anything contained herein to the
contrary notwithstanding, in the event that: (a) (i) any Lender (an “Increased
Cost Lender”) shall give notice to Borrower that such Lender is an Affected
Lender or that such Lender is entitled to receive payments under Section 2.18,
2.19 or 2.20, (ii) the circumstances which have caused such Lender to be an
Affected Lender or which entitle such Lender to receive such payments shall
remain in effect, and (iii) such Lender shall fail to withdraw such notice
within five Business Days after Borrower’s request for such withdrawal; or
(b) (i) any Lender shall become a Defaulting Lender, (ii) the Default Period for
such Defaulting Lender shall remain in effect, and (iii) such Defaulting Lender
shall fail to cure the default as a result of which it has become a Defaulting
Lender within five Business Days after Borrower’s request that it cure such
default; or (c) in connection with any proposed amendment, modification,
termination, waiver or consent with respect to any of the provisions hereof as
contemplated by Section 10.5(b), the consent of Requisite Lenders shall have
been obtained but the consent of one or more of such other Lenders (each a
“Non-Consenting Lender”) whose consent is required shall not have been obtained;
then, with respect to each such Increased Cost Lender, Defaulting Lender or
Non-Consenting Lender (the “Terminated Lender”), Borrower may, by giving written
notice to Administrative Agent and any Terminated Lender of its election to do
so, elect to cause such Terminated Lender (and such Terminated Lender hereby
irrevocably agrees) to assign its outstanding Loans and its Revolving
Commitments, if any, in full to one or more Eligible Assignees (each a
“Replacement Lender”) in accordance with the provisions of Section 10.6 and
Borrower shall pay the fees, if any, payable thereunder in connection with any
such assignment from an Increased Cost Lender, a Non-Consenting Lender or
Insolvency Defaulting Lender, and the Funds Defaulting Lender (if not also an
Insolvency Defaulting Lender) shall pay the fees, if any, payable thereunder in
connection with any such assignment from such Defaulting Lender; provided,
(1) on the date of such assignment, the Replacement Lender shall pay to
Terminated Lender an amount equal to the sum of (A) an amount equal to the
principal of, and all accrued interest on, all outstanding Loans of the
Terminated Lender, (B) an amount equal to all unreimbursed drawings that have
been funded by such Terminated

 

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Lender, together with all then unpaid interest with respect thereto at such time
and (C) an amount equal to all accrued, but theretofore unpaid fees owing to
such Terminated Lender pursuant to Section 2.11; (2) on the date of such
assignment, Borrower shall pay any amounts payable to such Terminated Lender
pursuant to Section 2.18(c), 2.19 or 2.20; or otherwise as if it were a
prepayment; (3) in the case of any assignment resulting from a claim for
compensation under Section 2.19 or payments required to be made under
Section 2.20, such assignment will result in a reduction in such compensation or
payment and (4) in the event such Terminated Lender is a Non-Consenting Lender,
each Replacement Lender shall consent, at the time of such assignment, to each
matter in respect of which such Terminated Lender was a Non-Consenting Lender;
provided that Borrower may not make such election with respect to any Terminated
Lender that is also an Issuing Bank unless, prior to the effectiveness of such
election, Borrower shall have caused each outstanding Letter of Credit issued
thereby to be cancelled. Upon the prepayment of all amounts owing to any
Terminated Lender and the termination of such Terminated Lender’s Revolving
Commitments, if any, such Terminated Lender shall no longer constitute a
“Lender” for purposes hereof; provided that any rights of such Terminated Lender
to indemnification hereunder shall survive as to such Terminated Lender. Each
Lender agrees that if Borrower exercises its option hereunder to cause an
assignment by such Lender as a Terminated Lender, such Lender shall, promptly
after receipt of written notice of such election, execute and deliver all
documentation necessary to effectuate such assignment in accordance with
Section 10.6. In the event that a Terminated Lender does not comply with the
requirements of the immediately preceding sentence within one Business Day after
receipt of such notice, each Lender hereby authorizes and directs the
Administrative Agent to execute and deliver such documentation as may be
required to give effect to an assignment in accordance with Section 10.6 on
behalf of such Terminated Lender and any such documentation so executed by the
Administrative Agent shall be effective for purposes of documenting an
assignment pursuant to Section 10.6.

2.24 Interest Act (Canada). For purposes of disclosure pursuant to the Interest
Act (Canada), the annual rates of interest or fees to which the rates of
interest or fees provided for in this Agreement and the other Credit Documents
(and stated herein or therein, as applicable, to be computed on the basis of a
360 day year or any other period of time less than a calendar year) are
equivalent are the rates so provided for multiplied by the actual number of days
in the applicable calendar year and divided by 360 or the actual number of days
in such other period of time, respectively.

2.25 Incremental Facilities. Borrower may by written notice to Administrative
Agent elect to request (A) prior to the Revolving Commitment Termination Date,
an increase to the existing Revolving Loan Commitments (any such increase, the
“New Revolving Loan Commitments”) and/or (B) the establishment of one or more
new term loan commitments (the “New Term Loan Commitments”), by an amount such
that Borrower and its Subsidiaries shall be in compliance, on a Pro Forma Basis
after giving effect to such New Term Loans or New Revolving Loan Commitments and
the application of the proceeds thereof, with a Secured Leverage Ratio of 2.50
to 1.00; provided, that, the aggregate amount of any New Revolving Loan
Commitments and/or Tranche A New Term Loan Commitments may not exceed
$500,000,000; provided, further, any New Revolving Loan Commitment or New Term
Loan Commitment shall not be less than $25,000,000 individually (or such lesser
amount which shall be approved by Administrative Agent or such lesser amount
that represents all remaining availability under any limit set forth above in
this Section 2.25), and integral multiples of $10,000,000 in excess of that
amount. Each such notice shall specify (A) the date (each, an “Increased Amount
Date”) on which Borrower proposes that the New Revolving Loan Commitments or New
Term Loan Commitments shall be effective, which shall be a date not less than 5
Business Days after the date on which such notice is delivered to Administrative
Agent, or such later date acceptable to the Administrative Agent, and (B) the
identity of each Lender or other Person that is an Eligible Assignee; provided
that, Issuing Bank shall have consented (such consent not to be unreasonably
withheld or delayed) to the allocation of New Revolving Loan Commitments to any
Eligible Assignee under clause (ii) of the definition thereof (each, a “New
Revolving Loan Lender” or “New Term Loan Lender,” as applicable) to whom
Borrower proposes any portion

 

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of such New Revolving Loan Commitments or New Term Loan Commitments, as
applicable, be allocated and the amounts of such allocations; provided that GSLP
may elect or decline to arrange such New Revolving Loan Commitments or New Term
Loan Commitments, as applicable, in its sole discretion and any Lender
approached to provide all or a portion of the New Revolving Loan Commitments or
New Term Loan Commitments may elect or decline, in its sole discretion, to
provide a New Revolving Loan Commitments or New Term Loan Commitment.

Such New Revolving Loan Commitments or New Term Loan Commitments shall become
effective, as of such Increased Amount Date; provided that (1) no Default or
Event of Default shall exist on such Increased Amount Date before or after
giving effect to such New Revolving Loan Commitments or New Term Loan
Commitments; (2) both before and after giving effect to the making of any Series
of New Term Loans, each of the conditions set forth in Section 3.3 shall be
satisfied; (3) Borrower and its Subsidiaries shall be in compliance, on a Pro
Forma Basis after giving effect to such New Term Loans and the application of
the proceeds thereof, with each of the covenants set forth in Section 6.7 as of
the last day of the most recently ended Fiscal Quarter after giving effect to
such New Revolving Loan Commitments or New Term Loan Commitments; (4) the New
Revolving Loan Commitments or New Term Loan Commitments, as applicable, shall be
effected pursuant to one or more Joinder Agreements executed and delivered by
the applicable New Revolving Loan Lender or New Term Loan Lender, as the case
may be, Borrower and Administrative Agent, and each of which shall be recorded
in the Register and shall be subject to the requirements set forth in
Section 2.20(d); (5) Borrower shall make any payments required pursuant to
Section 2.18(c) in connection with the New Revolving Loan Commitments or New
Term Loan Commitments, as applicable; (6) Borrower shall deliver or cause to be
delivered any legal opinions or other documents reasonably requested by
Administrative Agent in connection with any such transaction. Any New Term Loans
made on an Increased Amount Date shall be designated a separate series (a
“Series”) of New Term Loans for all purposes of this Agreement and (7) Borrower
and its Subsidiaries shall be in compliance, on a Pro Forma Basis, with a
Leverage Ratio as of the Increased Amount Date (assuming in the case of any New
Revolving Commitments, that the full amount of all outstanding Revolving
Commitments, including New Revolving Commitments, are borrowed on such date), of
5.25 to 1.00.

On any Increased Amount Date on which New Revolving Loan Commitments are
effected, subject to the satisfaction of the foregoing terms and conditions,
(a) each of the Revolving Lenders shall assign to each of the New Revolving Loan
Lenders, and each of the New Revolving Loan Lenders shall purchase from each of
the Revolving Loan Lenders, at the principal amount thereof (together with
accrued interest), such interests in the Revolving Loans outstanding on such
Increased Amount Date as shall be necessary in order that, after giving effect
to all such assignments and purchases, such Revolving Loans will be held by
existing Revolving Loan Lenders and New Revolving Loan Lenders ratably in
accordance with their Revolving Loan Commitments after giving effect to the
addition of such New Revolving Loan Commitments to the Revolving Loan
Commitments, (b) each New Revolving Loan Commitment shall be deemed for all
purposes a Revolving Loan Commitment and each Loan made thereunder (a “New
Revolving Loan”) shall be deemed, for all purposes, a Revolving Loan and
(c) each New Revolving Loan Lender shall become a Lender with respect to the New
Revolving Loan Commitment and all matters relating thereto.

On any Increased Amount Date on which any New Term Loan Commitments of any
Series are effective, subject to the satisfaction of the foregoing terms and
conditions, (i) each New Term Loan Lender of any Series shall make a Loan to
Borrower (a “New Term Loan”) in an amount equal to its New Term Loan Commitment
of such Series, and (ii) each New Term Loan Lender of any Series shall become a
Lender hereunder with respect to the New Term Loan Commitment of such Series and
the New Term Loans of such Series made pursuant thereto.

 

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Administrative Agent shall notify Lenders promptly upon receipt of Borrower’s
notice of each Increased Amount Date and in respect thereof (x) the New
Revolving Loan Commitments and the New Revolving Loan Lenders or the Series of
New Term Loan Commitments and the New Term Loan Lenders of such Series, as
applicable, and (y) in the case of each notice to any Revolving Loan Lender, the
respective interests in such Revolving Loan Lender’s Revolving Loans, in each
case subject to the assignments contemplated by this Section.

The terms and provisions of the Tranche A New Term Loans of any Series shall be,
except with respect to pricing, amortization and maturity and except as
otherwise set forth herein or in the Joinder Agreement and otherwise reasonably
satisfactory to Administrative Agent, identical to the Tranche A Term Loans. The
terms and provisions of the Tranche B New Term Loans of any Series shall be,
except with respect to pricing, amortization and maturity and except as
otherwise set forth herein or in the Joinder Agreement and otherwise reasonably
satisfactory to Administrative Agent, identical to the Tranche B Term Loans. The
terms and provisions of the New Revolving Loans shall be, except with respect to
maturity, identical to the Revolving Loans. In any event (i) the weighted
average life to maturity of all New Term Loans of any Series shall be no shorter
than the then-remaining weighted average life to maturity of the Tranche B Term
Loans (other than with respect to a Tranche A New Term Loan, which shall have a
weighted average life to maturity not shorter than the remaining weighted
average life to maturity of the Tranche A Term Loans), (ii) the applicable New
Term Loan Maturity Date of each Series shall be no shorter than the latest of
the final maturity of the Tranche B Term Loans (other than with respect to a
Tranche A New Term Loan, which shall have a maturity date not earlier than the
Tranche A Term Loan Maturity Date), and (iii) the yield applicable to the New
Term Loans of each Series shall be determined by Borrower and the applicable new
Lenders and shall be set forth in each applicable Joinder Agreement; provided
however (A) that the yield applicable to the Tranche A New Term Loans (after
giving effect to all upfront or similar fees or original issue discount payable
with respect to such Tranche A New Term Loans) shall not be greater than the
applicable yield payable pursuant to the terms of this Agreement as amended
through the date of such calculation with respect to Tranche A Term Loans
(including any upfront or similar fees or original issue discount paid and
payable to the initial Lenders hereunder) plus 0.50% per annum unless the
interest rate with respect to the Tranche A Term Loan is increased so as to
cause the then applicable yield under this Agreement on the Tranche A Term Loans
(including any upfront or similar fees or original issue discount paid and
payable to the initial Lenders hereunder) to equal the yield then applicable to
the Tranche A New Term Loans (after giving effect to all upfront or similar fees
or original issue discount payable with respect to such Tranche A New Term
Loans) minus 0.50% per annum and (B) that the yield applicable to the Tranche B
New Term Loans (after giving effect to all upfront or similar fees or original
issue discount payable with respect to such Tranche B New Term Loans) shall not
be greater than the applicable yield payable pursuant to the terms of this
Agreement as amended through the date of such calculation with respect to
Tranche B Term Loans (including any upfront or similar fees or original issue
discount paid and payable to the initial Lenders hereunder) plus 0.50% per annum
unless the interest rate with respect to the Tranche B Term Loan is increased so
as to cause the then applicable yield under this Agreement on the Tranche B Term
Loans (including any upfront or similar fees or original issue discount paid and
payable to the initial Lenders hereunder) to equal the yield then applicable to
the Tranche B New Term Loans (after giving effect to all upfront or similar fees
or original issue discount payable with respect to such Tranche B New Term
Loans) minus 0.50% per annum. For purposes of clause (iii) of the immediately
preceding sentence, upfront or similar fees and original issue discount will be
equated to interest rates based upon an assumed four-year average life. Each
Joinder Agreement may, without the consent of any other Lenders, effect such
amendments to this Agreement and the other Credit Documents as may be necessary
or appropriate, in the opinion of the Administrative Agent, to effect the
provisions of this Section 2.25.

 

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SECTION 3. CONDITIONS PRECEDENT

3.1 Third Restatement Date. The effectiveness of this Agreement and the
obligation of each Lender to make a Tranche B Term Loan, a Revolving Loan, or to
issue a Letter of Credit, in each case on the Third Restatement Date are subject
to the prior or concurrent satisfaction, or waiver in accordance with
Section 10.5, of the following conditions:

(a) Credit Party Documents. Administrative Agent and Arrangers shall have
received sufficient copies of each Credit Document executed and delivered by
each applicable Credit Party for each Lender.

(b) Organizational Documents; Incumbency. Administrative Agent and Arrangers
shall have received (i) a copy of each Organizational Document executed and
delivered by each Credit Party, as applicable, and, to the extent applicable,
certified as of a recent date by the appropriate governmental official, each
dated the Third Restatement Date or a recent date prior thereto (or a
certificate of a Responsible Officer certifying that the Organizational
Documents previously delivered to Administrative Agent and Arranger on or about
the Second Restatement Date or the Second Amendment and Restatement Joinder Date
remain in full force and effect and unmodified as of the Third Restatement
Date); (ii) signature and incumbency certificates of the officers of such Person
executing the Credit Documents to which it is a party; (iii) resolutions of the
board of directors or similar governing body of each Credit Party approving and
authorizing the execution, delivery and performance of this Agreement and the
other Credit Documents to which it is a party or by which it or its assets may
be bound as of the Third Restatement Date, including the Amendment Agreement,
certified as of the Third Restatement Date by its secretary or an assistant
secretary as being in full force and effect without modification or amendment;
(iv) a certificate of status, certificate of compliance or other certificate of
good standing from the applicable Governmental Authority of each Credit Party’s
jurisdiction of incorporation, organization, amalgamation or formation and in
each jurisdiction in which it is qualified as a foreign corporation or other
entity to do business, each dated a recent date prior to the Third Restatement
Date; and (v) such other documents, including, without limitation, current
international SRL licenses for the applicable Barbados Credit Parties, a
negative certificate from the Luxembourg Trade and Companies Register with
respect to the Luxembourg Guarantor, an excerpt from the Luxembourg Trade and
Companies Register for the Luxembourg Guarantor and an excerpt from the
applicable commercial register for the Swiss Guarantor as Administrative Agent
and Arrangers may reasonably request.

(c) [Intentionally Omittted].

(d) Personal Property Collateral. Each Credit Party shall have delivered to
Collateral Agent:

(i) evidence satisfactory to Collateral Agent of the compliance by each Credit
Party with their obligations under the Second Amended and Restated Pledge and
Security Agreement, the Canadian Pledge and Security Agreement, the Quebec
Security Documents, the Barbados Security Documents, the Luxembourg Security
Documents, the Swiss Security Documents and the other Collateral Documents
(including their obligations to execute and deliver, file or register UCC and
PPSA financing statements (or equivalent filings), as applicable, to deliver
originals of securities, instruments and chattel paper and any agreements
governing deposit and/or securities accounts as provided therein);

 

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(ii) a completed supplement to the Collateral Questionnaire dated on or prior to
the Third Restatement Date and executed by an Authorized Officer of each
Additional Credit Party, together with all attachments contemplated thereby; and

(iii) the results of a recent bring down lien search, by a Person reasonably
satisfactory to the Collateral Agent, of all effective UCC and PPSA financing
statements (or equivalent filings, including Quebec Register of Personal and
Moveable Real Rights filings) made with respect to any Credit Party in each
jurisdiction where the Collateral Agent, acting reasonably, considers it to be
necessary or desirable that such searches be conducted, together with copies of
all such filings disclosed by such search and (B) UCC and PPSA financing change
statements (or similar documents) duly executed or authorized by all applicable
Persons for filing in all applicable jurisdictions as may be necessary to
terminate any effective UCC or PPSA financing statements (or equivalent filings)
disclosed in such search (other than any such financing statements in respect of
Permitted Liens).

(e) Opinions of Counsel to Credit Parties. Lenders and their respective counsel
shall have received originally executed copies of the favorable written opinions
of:

(i) Skadden, Arps, Slate, Meagher & Flom LLP, U.S. counsel to Borrower;

(ii) Chancery Chambers, special Barbados counsel to Borrower;

(iii) Norton Rose Canada LLP, special Canadian counsel to Borrower;

(iv) Stewart McKelvey, special Nova Scotia counsel to Borrower;

(v) Fillmore Riley LLP, special Manitoba counsel to Borrower;

(vi) Clark Wilson LLP, special British Columbia counsel to Borrower; and

(vii) Baker & McKenzie, special Luxembourg and Swiss counsel to Borrower.

in each case as to such matters as Administrative Agent may reasonably request,
dated as of the Third Restatement Date and otherwise in form and substance
reasonably satisfactory to Administrative Agent and Arrangers (and each Credit
Party hereby instructs such counsel to deliver such opinions to Agents and
Lenders).

(f) Fees and Expenses. Borrower shall have paid to the Administrative Agent all
fees payable on the Third Restatement Date referred to in Section 2.11(c) and
shall have reimbursed the Administrative Agent and the Arrangers for their
out-of-pocket expenses, including the invoiced legal fees and expenses of Cahill
Gordon & Reindel LLP; Lex Caribbean; Osler, Hoskin & Harcourt LLP, Lenz &
Staehelin and Elvinger, Hoss & Prussen and Mallesons Stephen Jaques.

(g) Solvency Certificate. On the Third Restatement Date, Administrative Agent
and Arrangers shall have received a Solvency Certificate dated the Third
Restatement Date and addressed to Administrative Agent and Lenders, and in form,
scope and substance satisfactory to Administrative Agent, certifying that
Borrower and its Subsidiaries that are Credit Parties are and will be Solvent on
a consolidated basis.

 

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(h) Third Restatement Date Certificate. Borrower shall have delivered to
Administrative Agent and Arrangers an originally executed Third Restatement Date
Certificate.

(i) Title Insurance. Administrative Agent shall have received an executed copy
of an endorsement amending the name of the insured under the title insurance
policy in respect of the real property secured by the Quebec Security Documents.

Each Lender, by delivering its signature page to this Agreement, shall be deemed
to have acknowledged receipt of, and consented to and approved, each Credit
Document and each other document required to be approved by any Agent, Requisite
Lenders or Lenders, as applicable on the Third Restatement Date.

Notwithstanding anything to the contrary contained in this Agreement or the
other Credit Documents, the parties hereto acknowledge and agree that (i) the
delivery of any document or instrument, and the taking of any action, set forth
on Schedule 5.15 hereto shall not be a condition precedent to the Third
Restatement Date but shall be required to be satisfied after the Third
Restatement Date in accordance with Schedule 5.15 hereto, and (ii) all
conditions precedent and representations, warranties, covenants, Events of
Default and other provisions contained in this Agreement and the other Credit
Documents shall be deemed modified as set forth on Schedule 5.15 hereto (and to
permit the taking of the actions described therein within the time periods
required therein, rather than as elsewhere provided in the Credit Documents);
provided that (x) to the extent any representation and warranty would not be
true because the actions set forth therein were not taken on the Third
Restatement Date, the respective representation and warranty shall be required
to be true and correct in all material respects at the time the respective
action is taken (or was required to be taken) in accordance with the provisions
of Schedule 5.15 and (y) all representations and warranties relating to the
Collateral Documents set forth in Schedule 5.15 shall be required to be true
immediately after the actions required to be taken by Schedule 5.15 have been
taken (or were required to be taken).

3.2 Prior Credit Dates. The obligations of (a) the Lenders (including the Swing
Line Lender) to make Loans and (b) Issuing Bank to issue Letters of Credit on
the Original Closing Date, the First Restatement Date and the Second Restatement
Date was subject to the satisfaction of all of the conditions precedent set
forth in Section 3.1 of the Original Credit Agreement, the First Amended and
Restated Credit Agreement, and the Second Amended and Restated Credit Agreement,
respectively.

3.3 Conditions to Each Credit Extension.

(a) Conditions Precedent. The obligation of each Lender to make any Loan, or
Issuing Bank to issue, amend, modify, renew or extend any Letter of Credit, on
any Credit Date, on or after the Third Restatement Date, are subject to the
satisfaction, or waiver in accordance with Section 10.5, of the following
conditions precedent:

(i) Administrative Agent shall have received a fully executed and delivered
Funding Notice or Issuance Notice, as the case may be;

(ii) after making the Credit Extensions requested on such Credit Date, the Total
Utilization of Revolving Commitments shall not exceed the Revolving Commitments
then in effect;

(iii) as of such Credit Date, the representations and warranties contained
herein and in the other Credit Documents, in each case, shall be true and
correct in all material respects on and as of that Credit Date to the same
extent as though made on and as of that date, except to the extent such
representations and warranties specifically relate to an earlier date, in which
case such representations and warranties shall have been true and correct in all
material respects on and as

 

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of such earlier date; provided that, in each case, such materiality qualifier
shall not be applicable to any representations and warranties that already are
qualified or modified by materiality in the text thereof;

(iv) no event shall have occurred and be continuing or would result from the
consummation of the applicable Credit Extension that would constitute an Event
of Default or a Default; and

(v) on or before the date of issuance, amendment, modification, renewal or
extension of any Letter of Credit, Administrative Agent shall have received all
other information required by the applicable Letter of Credit application, and
such other documents or information as Issuing Bank may reasonably require in
connection with the issuance amendment, modification, renewal or extension of
such Letter of Credit.

(b) Notices. Any Notice shall be executed by an Authorized Officer in a writing
delivered to Administrative Agent. In lieu of delivering a Notice, Borrower may
give Administrative Agent telephonic notice by the required time of any proposed
borrowing, conversion/continuation or issuance of a Letter of Credit, as the
case may be; provided that each such telephonic notice shall be promptly
confirmed in writing by delivery of the applicable Notice to Administrative
Agent on or before the close of business on the date that the telephonic notice
is given. In the event of a discrepancy between the telephonic notice and the
written Notice, the written Notice shall govern. In the case of any Notice that
is irrevocable once given, if Borrower provides telephonic notice in lieu
thereof, such telephone notice shall also be irrevocable once given. Neither
Administrative Agent nor any Lender shall incur any liability to Borrower in
acting upon any telephonic notice referred to above that Administrative Agent
believes in good faith to have been given by a duly authorized officer or other
person authorized on behalf of Borrower or for otherwise acting in good faith.

SECTION 4. REPRESENTATIONS AND WARRANTIES

In order to induce Agents, Lenders and Issuing Bank to enter into this Agreement
and to make each Credit Extension to be made thereby, each Credit Party
represents and warrants to each Agent, each Lender and Issuing Bank, on the
Third Restatement Date and on each Credit Date, that the following statements
are true and correct.

4.1 Organization; Requisite Power and Authority; Qualification. Except as
otherwise set forth on Schedule 4.1, each of Borrower and its Subsidiaries
(a) is duly organized, validly existing and, to the extent such concept is
applicable in the relevant jurisdiction, in good standing under the laws of its
jurisdiction of organization as identified in Schedule 4.1, (b) has all
requisite power and authority to own and operate its properties, to carry on its
business as now conducted and as proposed to be conducted, to enter into the
Credit Documents to which it is a party and to carry out the transactions
contemplated thereby, and (c) to the extent such concept is applicable in the
relevant jurisdiction, is qualified to do business and in good standing in every
jurisdiction where its assets are located and wherever necessary to carry out
its business and operations, except in jurisdictions where the failure to be so
qualified or in good standing has not had, and could not be reasonably expected
to have, a Material Adverse Effect.

4.2 Equity Interests and Ownership. The Equity Interests of each of Borrower and
its Subsidiaries have been duly authorized and validly issued and are fully paid
and non-assessable. Except as set forth on Schedule 4.2, as of the date hereof,
there is no existing option, warrant, call, right, commitment or other agreement
to which Borrower or any of its Subsidiaries is a party requiring, and there is
no membership interest or other Equity Interests of Borrower or any of its
Subsidiaries outstanding which upon conversion or exchange would require, the
issuance by Borrower or any of its Subsidiaries of any

 

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additional membership interests or other Equity Interests of Borrower or any of
its Subsidiaries or other Securities convertible into, exchangeable for or
evidencing the right to subscribe for or purchase a membership interest or other
Equity Interests of Borrower or any of its Subsidiaries. Schedule 4.2 correctly
sets forth the ownership interest of Borrower and each of its Subsidiaries as of
the Third Restatement Date.

4.3 Due Authorization. The execution, delivery and performance of the Credit
Documents have been duly authorized by all necessary action on the part of each
Credit Party that is a party thereto.

4.4 No Conflict. The execution, delivery and performance by Credit Parties of
the Credit Documents to which they are parties and the consummation of the
transactions contemplated by the Credit Documents do not and will not
(a) violate (i) any provision of any Applicable Law, (ii) any of the
Organizational Documents of Borrower or any of its Subsidiaries, or (iii) any
order, judgment or decree of any court or other agency of government binding on
Borrower or any of its Subsidiaries, except with respect to clauses (i) and
(iii) to the extent that such violation could not reasonably be expected to have
a Material Adverse Effect; (b) conflict with, result in a breach of or
constitute (with due notice or lapse of time or both) a default under any
Contractual Obligation of Borrower or any of its Subsidiaries, except to the
extent that such conflict, breach or default could not reasonably be expected to
have a Material Adverse Effect; (c) result in or require the creation or
imposition of any Lien upon any of the properties or assets of Borrower or any
of its Subsidiaries (other than any Liens created under any of the Credit
Documents in favor of Collateral Agent, on behalf of Secured Parties); or
(d) require any approval of stockholders, members or partners or any approval or
consent of any Person under any Contractual Obligation of Borrower or any of its
Subsidiaries, except for such approvals or consents which will be obtained on or
before the Third Restatement Date and disclosed in writing to Lenders and except
for any such approval or consent the failure of which to obtain could not
reasonably be expected to have a Material Adverse Effect.

4.5 Governmental Consents. (a) The execution, delivery and performance by Credit
Parties of the Credit Documents to which they are parties and the consummation
of the financing contemplated by this Agreement do not and will not require any
registration with, consent or approval of, or notice to, or other action to,
with or by, any Governmental Authority, except for filings and recordings with
respect to the Collateral to be made, or otherwise delivered to Collateral Agent
for filing and/or recordation, and (b) with respect to the consummation of each
Acquisition, as of the date thereof, consummation of such Acquisition did not
require any registration with, consent or approval of, or notice to, or other
action to, with or by, any Governmental Authority as of the date thereof, except
for such registrations, consents, notices or other actions which were obtained
or made on or before such date.

4.6 Binding Obligation. Each Credit Document has been duly executed and
delivered by each Credit Party that is a party thereto and is the legally valid
and binding obligation of such Credit Party, enforceable against such Credit
Party in accordance with its respective 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.

4.7 Historical Financial Statements. The Historical Financial Statements were
prepared in conformity with GAAP and fairly present, in all material respects,
the financial position, on a consolidated basis, of the Persons described in
such financial statements as at the respective dates thereof and the results of
operations and cash flows, on a consolidated basis, of the Persons described
therein for each of the periods then ended, subject, in the case of any such
unaudited financial statements, to changes resulting from audit and normal year
end adjustments and the absence of footnotes. As of the Third Restatement Date,
none of Borrower or any of its Subsidiaries has any contingent liability or
liability for taxes, long term lease or unusual forward or long term commitment
that is not reflected in the Historical Financial

 

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Statements or the notes thereto and which in any such case is material in
relation to the business, operations, properties, assets or condition (financial
or otherwise) of Borrower and its Subsidiaries taken as a whole.

4.8 Projections. On and as of the Third Restatement Date, the Projections of
Borrower and its Subsidiaries for the period of Fiscal Year 2012 through and
including Fiscal Year 2016 provided to Lenders or prospective Lenders in writing
on or prior to the Third Restatement Date (the “Projections”) are based on good
faith estimates and assumptions made by the management of Borrower; provided
that the Projections are not to be viewed as facts and that actual results
during the period or periods covered by the Projections may differ from such
Projections and that the differences may be material.

4.9 No Material Adverse Change. Since January 1, 2011, no event, circumstance or
change has occurred that has caused or evidences, or could reasonably be
expected to have, either in any case or in the aggregate, a Material Adverse
Effect.

4.10 Adverse Proceedings, etc. There are no Adverse Proceedings, individually or
in the aggregate, that could reasonably be expected to have a Material Adverse
Effect. None of Borrower or any of its Subsidiaries (a) is in violation of any
Applicable Laws (including Environmental Laws) that, individually or in the
aggregate, could reasonably be expected to have a Material Adverse Effect, or
(b) is subject to or in default with respect to any Governmental Authority or
any final judgments, writs, injunctions, decrees, rules or regulations of any
Governmental Authority, that, individually or in the aggregate, could reasonably
be expected to have a Material Adverse Effect.

4.11 Payment of Taxes. Except for any failure that would not be reasonably
expected to, individually or in the aggregate, result in a Material Adverse
Effect:

(a) all Tax returns and reports of Borrower and each of its Subsidiaries
required to be filed by any of them have been timely filed, and all Taxes
(whether or not shown on such Tax returns) of Borrower and each of its
Subsidiaries and upon their respective properties, assets, income, businesses
and franchises (including in the capacity of a withholding agent) which are due
and payable have been timely paid (except for Taxes that are being contested in
accordance with the terms of Section 5.3) and adequate accruals and reserves
have been made in accordance with GAAP for Taxes of Borrower and each of its
Subsidiaries in that are not due and payable; and

(b) there is no current, or, to the knowledge of Borrower or its Subsidiaries,
proposed or pending audit, examination, Tax assessment, claims or proceedings
against Borrower or any of its Subsidiaries which is not being actively
contested by Borrower or such Subsidiary in good faith and by appropriate
proceedings and for which adequate reserves have been made in accordance with
GAAP by Borrower or any of its Subsidiaries, as applicable.

4.12 Properties.

(a) Title. Each of Borrower and its Subsidiaries has (i) good, sufficient and
legal and beneficial title to (in the case of fee interests in real property),
(ii) valid leasehold interests in (in the case of leasehold interests in real or
personal property), (iii) valid licensed rights in (in the case of licensed
interests in intellectual property) and (iv) good title to (in the case of all
other personal property), all of their respective properties and assets material
to its business, except for minor defects in title that do not interfere with
its ability to conduct its business as currently conducted or to utilize such
properties for their intended purposes. Except as permitted by this Agreement,
all such properties and assets are free and clear of Liens.

 

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(b) Real Estate. As of the Third Restatement Date, Schedule 4.12 contains a
true, accurate and complete list of (i) all Real Estate Assets, and (ii) all
leases, subleases, licenses or assignments of leases, subleases, licenses or
other agreements (together with all amendments, modifications, supplements,
renewals or extensions of any thereof) affecting each Real Estate Asset of any
Credit Party, regardless of whether such Credit Party is the landlord (licensor)
or tenant (licensee) (whether directly or as an assignee or successor in
interest) under such lease, sublease, license, assignment or other agreement.
Each agreement listed in clause (ii) of the immediately preceding sentence is in
full force and effect and Borrower does not have knowledge of any default that
has occurred and is continuing thereunder, except to the extent that the failure
to be in full force and effect or the occurrence and continuance of a default,
individually or in the aggregate, could not reasonably be expected to have a
Material Adverse Effect, and each such agreement constitutes the legally valid
and binding obligation of each applicable Credit Party, enforceable against such
Credit Party in accordance with its terms, except as enforcement may be limited
by bankruptcy, insolvency, reorganization, moratorium or similar laws relating
to or limiting creditors’ rights generally or by equitable principles. To the
knowledge of the Credit Parties, none of the buildings or other structures
located on any Real Estate Asset encroaches upon any land not owned or leased by
a Credit Party (except in a manner that constitutes a Permitted Lien), and there
are no restrictive covenants or statutes, regulations, orders or other laws
which restrict or prohibit the use in any material respect of any Real Estate
Asset or such buildings or structures for the purposes for which they are
currently used. To the knowledge of the Credit Parties, there are no
expropriation or similar proceedings, actual or threatened, against any Real
Estate Asset or any part thereof.

(c) Intellectual Property. Each Credit Party possesses or has, by valid and
enforceable license, ownership or the right to use all Intellectual Property
used in the conduct of its business and, to each Credit Party’s knowledge, has
the right to use such Intellectual Property without violation or infringement of
any rights of others with respect thereto.

4.13 Environmental Matters. None of Borrower or any of its Subsidiaries or any
of their respective Facilities or operations are subject to any actual or, to
Borrower’s knowledge, as applicable, threatened, order, consent decree or
settlement agreement with any Person pursuant to any Environmental Law or
relating to any Environmental Claim or any Release or threat of Release of
Hazardous Materials, that, individually or in the aggregate, could reasonably be
expected to result in a Material Adverse Effect. None of Borrower or any of its
Subsidiaries has received any written notice of non-compliance with any
Environmental Law, letter or request for information under Section 104 of the
Comprehensive Environmental Response, Compensation, and Liability Act (42 U.S.C.
§ 9604) or any comparable state law, except as, individually or in the
aggregate, could not reasonably be expected to result in a Material Adverse
Effect. Each Facility is free from the presence of Hazardous Materials, except
for such materials the presence of which, individually or in the aggregate,
could not reasonably be expected to result in a Material Adverse Effect. There
are and, to each of Borrower’s and its Subsidiaries’ knowledge, have been no
conditions, occurrences, or Release or threat of Release of Hazardous Materials
that could reasonably be expected to form the basis of a 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 Effect.
None of Borrower or any of its Subsidiaries or, to any Credit Party’s knowledge,
any 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, except as, individually or in the aggregate, could
not reasonably be expected to result in a Material Adverse Effect, and none of
Borrower’s or 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 or 270 or any state or other equivalent, in each case,
except as, individually or in the aggregate could not reasonably be expected to
result in a Material Adverse Effect. Borrower and each of its Subsidiaries,
Facilities and operations are in compliance with applicable Environmental Laws,
in each case, except as, individually or in the aggregate, could not reasonably
be expected to result in a Material Adverse Effect.

 

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4.14 No Defaults. None of Borrower or any of its Subsidiaries is in default in
the performance, observance or fulfillment of any of the obligations, covenants
or conditions contained in any of its Contractual Obligations, and no condition
exists which, with the giving of notice or the lapse of time or both, could
constitute such a default, except where the consequences, direct or indirect, of
such default or defaults, if any, could not reasonably be expected to have a
Material Adverse Effect.

4.15 Governmental Regulation. Borrower and its Subsidiaries are not subject to
regulation under the Investment Company Act of 1940 or any other Applicable Law
or Governmental Authorization that restricts or limits their ability to incur
Indebtedness or to perform or satisfy the Obligations.

4.16 Federal Reserve Regulations.

(a) None of Borrower or any of its Subsidiaries is engaged principally, or as
one of its important activities, in the business of extending credit for the
purpose of buying or carrying Margin Stock.

(b) No portion of the proceeds of any Credit Extension shall be used in any
manner, whether directly or indirectly, that causes or could reasonably be
expected to cause, such Credit Extension or the application of such proceeds to
violate Regulation T, Regulation U or Regulation X of the Board of Governors or
any other regulation thereof.

4.17 Employee Matters. None of Borrower or any of its Subsidiaries is engaged in
any unfair labor practice or other labor proceeding (including certification) or
complaint that could reasonably be expected to have a Material Adverse Effect.
Except as could not, individually or in the aggregate, reasonably be expected to
have a Material Adverse Effect, there is (a) no unfair labor practice complaint
pending against Borrower or any of its Subsidiaries or, to the knowledge of
Borrower, threatened against any of them before the National Labor Relations
Board or a labor board of any other jurisdiction, and no grievance or
arbitration proceeding arising out of or under any collective bargaining
agreement pending against Borrower or any of its Subsidiaries or, to the
knowledge of Borrower, threatened against any of them, and none of Borrower or
any of its Subsidiaries is in violation of any collective bargaining agreement,
(b) no strike or work stoppage in existence or, to the knowledge of Borrower,
threatened 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 is taking place with respect to the
employees of Borrower or any of its Subsidiaries. Except as could not,
individually or in the aggregate, reasonably be expected to have a Material
Adverse Effect, all payments due from any Canadian Credit Party for employee
health and welfare insurance have been paid or accrued as a liability on the
books of such Canadian Credit Party and such Canadian Credit Party has withheld
and remitted all employee withholdings to be withheld or remitted by it and has
made all employer contributions to be made by it, in each case, pursuant to
applicable law on account of the Canada Pension Plan maintained by the
Government of Canada, employment insurance, employee income taxes, and any other
required payroll deduction.

4.18 Employee Benefit Plans. Except as could not reasonably be expected to have
a Material Adverse Effect, (a) Borrower, each of its Subsidiaries and each of
their respective ERISA Affiliates are in compliance with all applicable
provisions and requirements of ERISA and the Internal Revenue Code and the
regulations and published interpretations thereunder with respect to each
Employee Benefit Plan, and have performed all their obligations under each
Employee Benefit Plan, (b) each Employee Benefit Plan which is intended to
qualify under Section 401(a) of the Internal Revenue Code has received a
favorable determination letter from the Internal Revenue Service indicating that
such Employee Benefit Plan is so qualified and, to the knowledge of Borrower,
nothing has occurred subsequent to the issuance of such determination letter
which would cause such Employee Benefit Plan to lose its qualified status,
(c) no liability to the PBGC (other than required premium payments), the
Internal Revenue Service, any Employee

 

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Benefit Plan or any trust established under Title IV of ERISA has been or is
expected to be incurred by Borrower, any of its Subsidiaries or any of their
ERISA Affiliates, (d) no ERISA Event has occurred or is reasonably expected to
occur and (e) except to the extent required under Section 4980B of the Internal
Revenue Code or similar state laws, no Employee Benefit Plan provides health or
welfare benefits (through the purchase of insurance or otherwise) for any
retired or former employee of Borrower, any of its Subsidiaries or any of their
respective ERISA Affiliates. The present value of the aggregate benefit
liabilities under each Pension Plan sponsored, maintained or contributed to by
Borrower, any of its Subsidiaries or any of their ERISA Affiliates (determined
as of the end of the most recent plan year on the basis of the actuarial
assumptions specified for funding purposes in the most recent actuarial
valuation for such Pension Plan), did not exceed the then-current aggregate
value of the assets of such Pension Plan by more than $70,000,000. As of the
most recent valuation date for each Multiemployer Plan for which the actuarial
report is available, the potential liability of Borrower, its Subsidiaries and
their respective ERISA Affiliates for a complete withdrawal from such
Multiemployer Plan (within the meaning of Section 4203 of ERISA), when
aggregated with such potential liability for a complete withdrawal from all
Multiemployer Plans, based on information available pursuant to Section 4221(e)
of ERISA, is not more than $70,000,000. Except as could not reasonably be
expected to have a Material Adverse Effect, Borrower, each of its Subsidiaries
and each of their ERISA Affiliates have complied with the requirements of
Section 515 of ERISA with respect to each Multiemployer Plan and are not in
“default” (as defined in Section 4219(c)(5) of ERISA) with respect to payments
to a Multiemployer Plan.

4.19 Canadian Employee Benefit Plans.

(a) Except as could not reasonably be expected to have a Material Adverse Effect
and except as set forth on Schedule 4.18, the Canadian Employee Benefit Plans
are, and have been, established, registered, amended, funded, invested and
administered in compliance with the terms of such Canadian Employee Benefit
Plans (including the terms of any documents in respect of such Canadian Employee
Benefit Plans), all Applicable Laws and any applicable collective agreements.
There is no investigation by a Governmental Authority or claim (other than
routine claims for payment of benefits) pending or, to the knowledge of a
Canadian Credit Party, threatened involving any Canadian Employee Benefit Plan
or its assets, and no facts exist which could reasonably be expected to give
rise to any such investigation or claim (other than routine claims for payment
of benefits) which if determined adversely, could reasonably be expected to have
a Material Adverse Effect.

(b) All employer and employee payments, contributions and premiums required to
be remitted, paid to or in respect of each Canadian Pension Plan have been paid
or remitted in accordance with its terms and all applicable laws.

(c) No Canadian Pension Plan Termination Events have occurred that individually
or in the aggregate, would result in a Canadian Credit Party owing an amount
that could reasonably be expected to have a Material Adverse Effect.

(d) Except as set forth on Schedule 4.18, no Credit Party has any liability
(contingent, matured or otherwise) in respect of a Defined Benefit Plan.

None of the Canadian Employee Benefit Plans, other than the Canadian Pension
Plans, provide benefits beyond retirement or other termination of service to
employees or former employees of a Canadian Credit Party, or to the
beneficiaries or dependants of such employees.

4.20 Solvency. The Credit Parties are and, upon the incurrence of any Obligation
by any Credit Party on any date on which this representation and warranty is
made, will be, Solvent, on a consolidated basis.

 

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4.21 Compliance with Statutes, etc. Each of Borrower and its Subsidiaries is in
compliance with all Applicable Laws imposed by all Governmental Authorities, in
respect of the conduct of its business and the ownership of its property
(including compliance with all applicable Environmental Laws with respect to any
Real Estate Asset or governing its business and the requirements of any permits
issued under such Environmental Laws with respect to any such Real Estate Asset
or the operations of Borrower or any of its Subsidiaries as currently operated
or conducted), except such non-compliance that, individually or in the
aggregate, could not reasonably be expected to result in a Material Adverse
Effect.

4.22 Disclosure. None of the reports, certificates or written statements
furnished to Lenders by or on behalf of Borrower or any of its Subsidiaries for
use in connection with the Transactions, other than projections and information
of a general economic or general industry nature, contains any untrue statement
of a material fact or omits to state a material fact (known to Borrower, in the
case of any document not furnished by either of them) necessary in order to make
the statements contained herein or therein not misleading as of the date made,
in light of the circumstances in which the same were made. Any projections and
pro forma financial information contained in such materials are based upon good
faith estimates and assumptions believed by Borrower to be reasonable at the
time made, it being recognized by Lenders that such projections as to future
events are not to be viewed as facts and that actual results during the period
or periods covered by any such projections may differ from the projected results
and such differences may be material. There are no facts known (or which should
upon the reasonable exercise of diligence be known) to Borrower (other than
matters of a general economic nature) that, individually or in the aggregate,
could reasonably be expected to result in a Material Adverse Effect and that
have not been disclosed herein or other documents, certificates and statements
furnished to Lenders for use in connection with the Transactions.

4.23 PATRIOT Act and PCTFA. To the extent applicable, each Credit Party is in
compliance, in all material respects, with the (i) Trading with the Enemy Act,
as amended, and each of the foreign assets control regulations of the United
States Treasury Department (31 CFR, Subtitle B, Chapter V, as amended) and any
other enabling legislation or executive order relating thereto, (ii) the PATRIOT
Act, (iii) Part II.1 of the Criminal Code (Canada), (iv) the Proceeds of Crime
(money laundering) and Terrorist Financing Act (Canada) (the “PCTFA”), (v) the
Regulations Implementing the United Nations Resolutions on the Suppression of
Terrorism (Canada) and (vi) United Nations Al-Qaida and Taliban Regulations
(Canada). No part of the proceeds of the Loans will be used, directly or
indirectly, 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 obtain any improper advantage, in violation of the United States
Foreign Corrupt Practices Act of 1977, as amended.

4.24 Creation, Perfection, etc. Except as otherwise contemplated hereby or under
any other Credit Document, including without limitation in Section 3 hereof, all
filings and other actions necessary to perfect the Liens on the Collateral
created under, and in the manner contemplated by, the Collateral Documents have
been duly made or taken or otherwise provided for (to the extent required hereby
or by the applicable Collateral Documents), and, to the extent not previously
executed and delivered, when executed and delivered, the Collateral Documents
will create in favor of Collateral Agent for the benefit of the Secured Parties,
or in favor of the Secured Parties, a valid and, together with such filings and
other actions (to the extent required hereby or by the applicable Collateral
Documents), perfected First Priority Lien on the Collateral, securing the
payment of the Obligations.

4.25 OFAC Matters. None of Borrower, any of its Subsidiaries or, to the
knowledge of Borrower, any director, officer, agent, employee or affiliate of
Borrower or any of its Subsidiaries is currently subject to any U.S. sanctions
administered by the Office of Foreign Assets Control of the U.S. Department of
the Treasury (“OFAC”); and Borrower and its Subsidiaries will not, directly or
indirectly, use the

 

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proceeds of the Loans, or lend, contribute or otherwise make available such
proceeds to any Subsidiary, joint venture partner or other Person or entity, for
the purpose of financing the activities of any Person currently subject to any
U.S. sanctions administered by OFAC.

SECTION 5. AFFIRMATIVE COVENANTS

Each Credit Party covenants and agrees that so long as any Commitment is in
effect and until payment in full of all principal of and interest on each Loan
and all fees, expenses and other amounts (other than contingent amounts not yet
due) payable under any Credit Document and cancellation or expiration of all
Letters of Credit, each Credit Party shall perform, and shall cause each of its
Subsidiaries to perform, all covenants in this Section 5.

5.1 Financial Statements and Other Reports. Borrower will deliver to
Administrative Agent on behalf of each Lender:

(a) Quarterly Financial Statements. Within 45 days after the end of each Fiscal
Quarter of each Fiscal Year, commencing with the Fiscal Quarter ending
September 30, 2011, the consolidated balance sheets of Borrower and its
Subsidiaries as at the end of such Fiscal Quarter and the related consolidated
statements of income and cash flows of Borrower and its Subsidiaries for such
Fiscal Quarter and for the period from the beginning of the then current Fiscal
Year to the end of such Fiscal Quarter, setting forth in each case in
comparative form the corresponding figures for the corresponding periods of the
previous Fiscal Year, commencing with the first Fiscal Quarter for which such
corresponding figures are available, all in reasonable detail, together with a
Financial Officer Certification and a Narrative Report with respect thereto;

(b) Annual Financial Statements. Within 90 days after the end of each Fiscal
Year, commencing with the Fiscal Year ending December 31, 2011, (i) the
consolidated balance sheets of Borrower and its Subsidiaries as at the end of
such Fiscal Year and the related consolidated statements of income,
stockholders’ equity and cash flows of Borrower and its Subsidiaries for such
Fiscal Year, setting forth in each case in comparative form the corresponding
figures for the previous Fiscal Year commencing with the first Fiscal Year for
which such corresponding figures are available, all in reasonable detail,
together with a Financial Officer Certification and a Narrative Report with
respect thereto; and (ii) with respect to such consolidated financial statements
a report thereon by an independent certified public accountant (or accountants)
of recognized national standing selected by Borrower, and reasonably
satisfactory to Administrative Agent (which report and/or the accompanying
financial statements shall be unqualified as to going concern and scope of
audit, and shall state that such consolidated financial statements fairly
present, in all material respects, the consolidated financial position of
Borrower and its Subsidiaries as at the dates indicated and the results of their
operations and their cash flows for the periods indicated in conformity with
GAAP applied on a basis consistent with prior years (except as otherwise
disclosed in such financial statements) and that the examination by such
accountants in connection with such consolidated financial statements has been
made in accordance with generally accepted auditing standards) together with a
written statement by such independent certified public accountants stating
(1) that their audit examination has included a review of the terms of
Section 6.7 of this Agreement and the related definitions, (2) whether, in
connection therewith, any condition or event that constitutes a Default or an
Event of Default under Section 6.7 has come to their attention and, if such a
condition or event has come to their attention, specifying the nature and period
of existence thereof, and (3) that nothing has come to their attention that
causes them to believe that the information contained in any Compliance
Certificate is not correct or that the matters set forth in such Compliance
Certificate are not stated in accordance with the terms hereof (which statement
may be limited to the extent required by accounting rules or guidelines);

 

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(c) Compliance Certificate. Together with each delivery of financial statements
of Borrower and its Subsidiaries pursuant to Sections 5.1(a) and 5.1(b), a duly
executed and completed Compliance Certificate;

(d) Statements of Reconciliation after Change in Accounting Principles. If, as a
result of any change in accounting principles and policies from those used in
the preparation of the Historical Financial Statements, the consolidated
financial statements of Borrower and its Subsidiaries delivered pursuant to
Section 5.1(a) or 5.1(b) will differ in any material respect from the
consolidated financial statements that would have been delivered pursuant to
such subdivisions had no such change in accounting principles and policies been
made, then, together with the first delivery of such financial statements after
such change, one or more statements of reconciliation for all such prior
financial statements in form and substance reasonably satisfactory to
Administrative Agent;

(e) Notice of Default. Promptly upon any Responsible Officer of Borrower
obtaining knowledge (i) of any condition or event that constitutes a Default or
an Event of Default or that notice has been given to Borrower with respect
thereto; (ii) that any Person has given any notice to Borrower or any of its
Subsidiaries or taken any other action with respect to any event or condition
set forth in Section 8.1(b); or (iii) of the occurrence of any event or change
that has caused or evidences or could reasonably be expected to result in,
either individually or in the aggregate, a Material Adverse Effect, a
certificate of an Authorized Officer specifying the nature and period of
existence of such condition, event or change, or specifying the notice given and
action taken by any such Person and the nature of such claimed Event of Default,
Default, default, event or condition, and what action Borrower has taken, is
taking and proposes to take with respect thereto;

(f) Notice of Litigation. Promptly upon any Responsible Officer of Borrower
obtaining knowledge of any actual or threatened (i) Adverse Proceeding not
previously disclosed in writing by Borrower to Lenders, or (ii) development in
any Adverse Proceeding that, in the case of either clause (i) or (ii), if
adversely determined could be reasonably expected to result in a Material
Adverse Effect, or seeks to enjoin or otherwise prevent the consummation of, or
to recover any damages or obtain relief as a result of, the Transactions,
written notice thereof together with such other information as may be reasonably
available to Borrower to enable Lenders and their counsel to evaluate such
matters;

(g) ERISA. (i) Promptly upon any Responsible Officer of Borrower obtaining
knowledge of the occurrence of or forthcoming occurrence of any ERISA Event, a
written notice specifying the nature thereof, what action Borrower, any of its
Subsidiaries or any of their respective ERISA Affiliates has taken, is taking or
proposes to take with respect thereto and, when known, any action taken or
threatened by the Internal Revenue Service, the Department of Labor or the PBGC
with respect thereto; and (ii) with reasonable promptness, copies of (1) each
Schedule B (Actuarial Information) to the annual report (Form 5500 Series) filed
by Borrower, any of its Subsidiaries or any of their respective ERISA Affiliates
with the Internal Revenue Service with respect to each Pension Plan; (2) all
notices received by Borrower, any of its Subsidiaries or any of their respective
ERISA Affiliates from a Multiemployer Plan sponsor concerning an ERISA Event;
and (3) copies of such other documents or governmental reports or filings
relating to any Employee Benefit Plan as Administrative Agent shall reasonably
request;

(h) Canadian Employee Benefit Plans. Promptly upon any Responsible Officer of
Borrower obtaining knowledge of: (1) a Canadian Pension Plan Termination Event;
(2) the failure to make a required contribution to or payment under any Canadian
Pension Plan when due;

 

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(3) the occurrence of any event which is reasonably likely to result in a
Canadian Credit Party incurring any liability, fine or penalty with respect to
any Canadian Employee Benefit Plan that could reasonably be expected to result
in a Material Adverse Effect; (4) the establishment of any material new Canadian
Employee Benefit Plans or (5) any change to an existing Canadian Employee
Benefit Plan that could reasonably be expected to result in a Material Adverse
Effect; in the notice to the Administrative Agent of the foregoing, copies of
all documentation relating thereto as Administrative Agent shall reasonably
request shall be provided;

(i) Financial Plan. As soon as practicable and in any event no later than 60
days subsequent to the beginning of each Fiscal Year (beginning with the Fiscal
Year ending December 31, 2012), a consolidated plan and financial forecast for
such Fiscal Year and each Fiscal Year (or portion thereof) through the final
maturity date of the Loans (a “Financial Plan”), including forecasted
consolidated statements of income of Borrower for each Fiscal Quarter of such
Fiscal Year (it being understood that the forecasted financial information is
not to be viewed as facts and that actual results during the period or periods
covered by the Financial Plan may differ from such forecasted financial
information and that such differences may be material);

(j) Insurance Report. As soon as practicable and in any event within 60 days
after the last day of each Fiscal Year, a certificate from Borrower’s insurance
broker in form and substance satisfactory to Administrative Agent outlining all
material insurance coverage maintained as of the date of such certificate by
Borrower and its Subsidiaries;

(k) Information Regarding Collateral. Borrower will furnish to Collateral Agent
prompt (and in any event within 30 days of such change) written notice of any
change (i) in any Credit Party’s legal name, (ii) in any Credit Party’s identity
or corporate structure, (iii) in any Credit Party’s jurisdiction of organization
or of the jurisdiction in which its chief executive office is located or (iv) in
any Credit Party’s Federal Taxpayer Identification Number or state
organizational identification number. Borrower agrees not to effect or permit
any change referred to in the preceding sentence unless all filings have been
made under the Uniform Commercial Code, the PPSA or similar laws of
jurisdictions in which Credit Parties are organized or otherwise that are
required in order for Collateral Agent to continue at all times following such
change to have a valid, legal and perfected security interest in all the
Collateral as contemplated in the Collateral Documents. Borrower also agrees
promptly to notify Collateral Agent if any material portion of the Collateral is
damaged or destroyed;

(l) Annual Collateral Verification. Each year, at the time of delivery of annual
financial statements with respect to the preceding Fiscal Year pursuant to
Section 5.1(b), Borrower shall deliver to Collateral Agent a certificate of an
Authorized Officer (i) either confirming that there has been no change in the
information required by the Collateral Questionnaire since the date of the most
recently delivered Collateral Questionnaire or the date of the most recent
certificate delivered pursuant to this Section and/or identifying such changes
and (ii) certifying that all Uniform Commercial Code and PPSA financing
statements (including fixtures filings, as applicable) and all supplemental
Intellectual Property Security Agreements or other appropriate filings,
recordings or registrations, have been filed or recorded in each governmental,
municipal or other appropriate office in each jurisdiction identified in the
Collateral Questionnaire or pursuant to clause (i) above to the extent necessary
to effect, protect and perfect the security interests under the Collateral
Documents for a period of not less than 18 months after the date of such
certificate (except as noted therein with respect to any continuation statements
to be filed within such period);

 

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(m) Other Information. (A) Promptly upon their becoming publicly available,
copies (or e-mail notice) of (i) all financial statements, reports, notices and
proxy statements sent or made available generally by Borrower to its security
holders acting in such capacity or by any Subsidiary of Borrower to its security
holders other than Borrower or another Subsidiary of Borrower, (ii) all regular
and periodic reports and all registration statements and prospectuses, if any,
filed by Borrower or any of its Subsidiaries with any securities exchange or
with the Securities and Exchange Commission, the Ontario Securities Commission
or any other Governmental Authority and (iii) all press releases and other
statements made available generally by Borrower or any of its Subsidiaries to
the public concerning material developments in the business of Borrower or any
of its Subsidiaries, and (B) such other information and data with respect to the
operations, business affairs and financial condition of Borrower or any of its
Subsidiaries as from time to time may be reasonably requested by Administrative
Agent or any Lender;

(n) Certification of Public Information. Borrower and each Lender acknowledge
that certain of the Lenders may be Public Lenders and, if documents or notices
required to be delivered pursuant to this Section 5.1 or otherwise are being
distributed through IntraLinks, SyndTrak or another relevant website or other
information platform (the “Platform”), any document or notice that Borrower has
indicated contains Non-Public Information shall not be posted on that portion of
the Platform designated for such Public Lenders. Borrower agrees to clearly
designate all information provided to Administrative Agent by or on behalf of
Borrower which is suitable to make available to Public Lenders. If Borrower has
not indicated whether a document or notice delivered pursuant to this
Section 5.1 contains Non-Public Information, Administrative Agent reserves the
right to post such document or notice solely on that portion of the Platform
designated for Lenders who wish to receive material non-public information with
respect to Borrower, its Subsidiaries and their respective Securities; and

(o) Environmental Reports and Audits. As soon as practicable following receipt
thereof, copies of all environmental audits and written reports with respect to
environmental matters at any Facility or that relate to any environmental
liabilities of any Credit Party, in each case that, individually or in the
aggregate, could reasonably be expected to result in a Material Adverse Effect.

(p) General. Any financial statement, report, notice, proxy statement,
registration statement, prospectus or other document required to be delivered
pursuant to this Section 5.1 shall be delivered in accordance with Section 10.1
and shall be deemed to have been delivered on the date on which such financial
statement, report, notice, proxy statement, registration statement, prospectus
or other document is posted on the SEC’s website on the Internet at www.sec.gov
and, in each case, such financial statement, report, notice, proxy statement,
registration statement, prospectus or other document is readily accessible to
the Administrative Agent on such date; provided that Borrower shall give notice
of any such posting to Administrative Agent (who shall then give notice of any
such posting to the Lenders). Furthermore, if any financial statement,
certificate or other information required to be delivered pursuant to this
Section 5.1 shall be required to be delivered on any date that is not a Business
Day, such financial statement, certificate or other information may be delivered
to Administrative Agent on the next succeeding Business Day after such date.

5.2 Existence. Except as otherwise permitted under Section 6.8, each Credit
Party will, and will cause each of its Subsidiaries to, at all times preserve
and keep in full force and effect its existence and all rights and franchises,
licenses and permits material to its business; provided that no Credit Party
(other than Borrower with respect to existence) or any of its Subsidiaries shall
be required to preserve any such existence, right or franchise, licenses and
permits if such Person’s board of directors (or similar governing

 

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body) shall determine that the preservation thereof is no longer desirable in
the conduct of the business of such Person, and that the loss thereof is not
disadvantageous in any material respect to such Person or to Lenders.

5.3 Payment of Taxes and Claims. Except for failures that, individually and in
the aggregate, would not reasonably be expected to result in a Material Adverse
Effect, each Credit Party will, and will cause each of its Subsidiaries to, pay
all Taxes 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 accrues
thereon, and all claims (including claims for labor, services, materials and
supplies) for sums that have become due and payable and that by law have or may
become a Lien upon any of its properties or assets, prior to the time when any
penalty or fine shall be incurred with respect thereto; provided, no such Tax or
claim need be paid if it is being contested in good faith by appropriate
proceedings promptly instituted and diligently conducted, so long as
(a) adequate reserve or other appropriate provision, as shall be required in
conformity with GAAP shall have been made therefor, and (b) in the case of a Tax
or claim which has or may become a Lien against any of the Collateral, such
contest proceedings conclusively operate to stay the sale of any portion of the
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).

5.4 Maintenance of Properties. 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 excepted, all material properties
used or useful in the business of Borrower and its Subsidiaries.

5.5 Insurance. Borrower and its Subsidiaries will maintain or cause to be
maintained, with financially sound and reputable insurers, such public liability
insurance, property damage insurance and business interruption insurance with
respect to liabilities, losses or damage in respect of the assets, properties
and businesses of Borrower and its Subsidiaries as is customarily carried or
maintained under similar circumstances by Persons of established reputation
engaged in similar businesses in the same or similar locations, in each case in
such amounts (giving effect to self-insurance), with such deductibles, covering
such risks and otherwise on such terms and conditions as shall be customary for
such Persons. Without limiting the generality of the foregoing, Borrower will
maintain or cause to be maintained (a) flood insurance with respect to each
Flood Hazard Property that is located in a community that participates in the
National Flood Insurance Program, in each case in compliance with any applicable
regulations of the Board of Governors of the Federal Reserve System, and
(b) replacement value property damage insurance on the Collateral under such
policies of insurance, with such insurance companies, in such amounts, with such
deductibles, and covering such risks as are carried or maintained under similar
circumstances by Persons of established reputation engaged in similar businesses
in the same or similar locations. Each such policy of insurance shall (i) name
Collateral Agent, on behalf of the Secured Parties, as an additional insured
thereunder as its interests may appear and (ii) in the case of each property
damage insurance policy, contain a loss payable clause or endorsement,
reasonably satisfactory in form and substance to Collateral Agent, that names
Collateral Agent, on behalf of the Secured Parties, as the loss payee thereunder
and provides for at least thirty days’ prior written notice to Collateral Agent
of any modification or cancellation of such policy; provided that the provisions
of the foregoing sentence shall not apply to any policy of insurance maintained
solely for the purpose of compliance with Applicable Law to the extent that the
assets, properties and businesses that are the subject of such policy are
separately the subject of an insurance policy with respect to which Borrower
shall have satisfied the provision of the foregoing sentence.

5.6 Books and Records; Inspections. Each Credit Party will, and will cause each
of its Subsidiaries to, keep proper books of record and accounts in which full,
true and correct entries in conformity in all material respects with GAAP shall
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business and activities. Each Credit Party will, and will cause each of its
Subsidiaries to, permit any authorized representatives designated by any Lender
to visit and inspect any of the properties of any Credit Party and any of its
respective Subsidiaries, to inspect, copy and take extracts from its and their
financial and accounting records, and to discuss its and their affairs, finances
and accounts with its and their officers and independent public accountants, all
upon reasonable notice and at such reasonable times during normal business hours
and as often as may reasonably be requested; provided that, excluding any such
visits and inspections during the continuation of an Event of Default, only the
Administrative Agent on behalf of the Lenders may exercise rights under this
Section 5.6 and the Administrative Agent shall not exercise such rights more
often than once during any calendar year absent the existence of an Event of
Default. Notwithstanding anything to the contrary in this Section 5.6 or any
other Credit Document, none of Borrower or any of its Subsidiaries shall be
required to disclose, permit the inspection, examination or making of copies or
taking of extracts of, or discussion of, any document, information or other
matter (a) that constitutes non-financial trade secrets or non-financial
proprietary information, (b) in respect of which disclosure to Administrative
Agent or any Lender (or any of their respective representatives) is prohibited
by any Applicable Law or any binding contractual agreement or (c) is subject to
attorney-client or similar privilege or constitutes attorney work product.

5.7 Lenders Meetings. Borrower will, upon the request of Administrative Agent or
Requisite Lenders, participate in a meeting of Administrative Agent and Lenders
once during each Fiscal Year to be held at Borrower’s corporate offices (or at
such other location as may be agreed to by Borrower and Administrative Agent) at
such time as may be agreed to by Borrower and Administrative Agent.

5.8 Compliance with Laws. Each Credit Party will comply, and shall cause each of
its Subsidiaries to comply, with the requirements of all Applicable Law, rules,
regulations and orders of any Governmental Authority (including all
Environmental Laws), non-compliance with which could reasonably be expected to
have, individually or in the aggregate, a Material Adverse Effect.

5.9 Environmental.

(a) Environmental Disclosure. Borrower will deliver to Administrative Agent and
Lenders:

(i) as soon as practicable following receipt thereof, copies of all written
reports of environmental audits, investigations or analyses of any kind or
character, whether prepared by personnel of Borrower or any of its Subsidiaries
or, to the extent in Borrower’s or any of its Subsidiaries’ possession or
control, by independent consultants, Governmental Authorities or any other
Persons, with respect to significant environmental matters at any Facility or
with respect to any Environmental Claims that, individually or in the aggregate,
could reasonably be expected to result in a Material Adverse Effect;

(ii) promptly upon the occurrence thereof, written notice describing in
reasonable detail (1) any Release required to be reported to any Governmental
Authority under any applicable Environmental Laws that, individually or in the
aggregate, could reasonably be expected to result in a Material Adverse Effect,
(2) any response or remedial action taken by Borrower or any other Person as a
result of (A) any Hazardous Materials at a Facility the existence of which could
reasonably be expected to result in one or more Environmental Claims having,
individually or in the aggregate, a Material Adverse Effect, or (B) any
Environmental Claims that, individually or in the aggregate, could reasonably be
expected to result in a Material Adverse Effect, (3) Borrower’s discovery of any
occurrences or conditions at any Facility that, individually or in the
aggregate, could reasonably be expected to result in a Material Adverse Effect,
and (4) Borrower’s discovery of any occurrence or condition on any real property
adjoining or in the vicinity of any Facility

 

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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 that, individually or in the aggregate, could reasonably
be expected to result in a Material Adverse Effect;

(iii) as soon as practicable following the sending or receipt thereof by
Borrower or any of its Subsidiaries, a copy of any and all written
communications to or from any Governmental Authority or third party claimant or
their representatives with respect to any Environmental Claims that,
individually or in the aggregate, could reasonably be expected to result in a
Material Adverse Effect;

(iv) prompt written notice describing in reasonable detail (1) any proposed
acquisition of stock, assets, or property by Borrower or any of its Subsidiaries
that could reasonably be expected to (A) expose Borrower or any of its
Subsidiaries to, or result in, Environmental Claims that could reasonably be
expected to have, individually or in the aggregate, a Material Adverse Effect or
(B) adversely affect the ability of Borrower or any of its Subsidiaries to
maintain in full force and effect Governmental Authorizations required under any
Environmental Laws for their respective operations, the absence of which could
reasonably be expected to result in a Material Adverse Effect and (2) any
proposed action to be taken by Borrower or any of its Subsidiaries to modify
current operations in a manner that could reasonably be expected to subject
Borrower or any of its Subsidiaries to any additional obligations or
requirements under any Environmental Laws, to the extent any such obligation or
requirement could reasonably be expected to result in a Material Adverse Effect;
and

(v) with reasonable promptness, such other documents and information as from
time to time may be reasonably requested by Administrative Agent in relation to
any matters disclosed pursuant to this Section 5.9(a).

(b) Environmental Matters. Each Credit Party shall promptly take, and shall
cause each of its Subsidiaries promptly to take, any and all actions necessary
to (i) cure any violation of applicable Environmental Laws by such Credit Party
or its Subsidiaries that could reasonably be expected to have, individually or
in the aggregate, a Material Adverse Effect, and (ii) make an appropriate
response to any Environmental Claim against such Credit Party or any of its
Subsidiaries and discharge any obligations it may have to any Person thereunder
where failure to do so could reasonably be expected to have, individually or in
the aggregate, a Material Adverse Effect, except in each case to the extent such
Credit Party or Subsidiary is contesting such violation, Environmental Claim or
obligation in good faith and by proper proceedings and appropriate reserves are
being maintained in accordance with GAAP.

5.10 Subsidiaries.

(1) In the event that any Person becomes a Domestic Subsidiary of Borrower
(other than a Subsidiary that is, or would be, an Excluded Subsidiary), Borrower
shall: (I) promptly cause such Domestic Subsidiary to become a Guarantor
hereunder and a Grantor under the Second Amended and Restated Pledge and
Security Agreement by executing and delivering to Administrative Agent and
Collateral Agent a Counterpart Agreement and a Pledge Supplement (as defined in
the Second Amended and Restated Pledge and Security Agreement ), and (II) take
all such actions and execute and deliver, or cause to be executed and delivered,
all such documents, instruments, agreements, and certificates as are similar to
those described in Sections 3.1(b), 3.1(f), 3.1(h) and 3.1(i) of the Original
Credit Agreement.

(2) In the event that any Person becomes a Foreign Subsidiary of VPI (other than
a Subsidiary that is, or would be, an Excluded Subsidiary), and the ownership
interests of such Foreign Subsidiary are directly owned by VPI or by any
Guarantor that is a Domestic Subsidiary thereof, Borrower shall, or

 

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shall cause such Domestic Subsidiary to: (I) deliver all such documents,
instruments, agreements, and certificates as are similar to those described in
Section 3.1(b), and (II) take all of the actions referred to in
Section 3.1(d)(i) necessary to grant and to perfect a First Priority Lien in
favor of Collateral Agent, for the benefit of Secured Parties, under the Second
Amended and Restated Pledge and Security Agreement (subject to the limitations
set forth therein) in 65% of such ownership interests that is voting stock and
100% of such ownership interest that is not voting stock.

(3) In the event that any Person becomes a Foreign Subsidiary of Borrower (but
not a Subsidiary of VPI) (other than a Subsidiary that is, or would be, an
Excluded Subsidiary), Borrower shall: (I) promptly cause such Subsidiary to
become a Guarantor (and to deliver (x) a Canadian Guarantee in respect of any
such Foreign Subsidiary that is a Canadian Credit Party satisfying clause (i) of
the definition thereof, (y) a Barbados Guarantee in respect of any such Foreign
Subsidiary that is a Barbados Credit Party and (z) a Counterpart Agreement in
form and substance sufficient to create a binding Guarantee of the Obligations
by each such Foreign Subsidiary not meeting the requirements of clauses (x) and
(y) above) (and to deliver (v) the Luxembourg Security Documents in respect of
any such Foreign Subsidiary that is a Luxembourg Guarantor, (w) the Swiss
Security Documents, in respect of any such Foreign Subsidiary that is a Swiss
Guarantor, (x) the Canadian Pledge and Security Agreement and, as applicable,
Quebec Security Documents, in respect of any such Foreign Subsidiary that is a
Canadian Credit Party satisfying clause (i) of the definition thereof, (y) the
Barbados Security Documents in respect of any such Foreign Subsidiary that is a
Barbados Credit Party and (z) such agreement or agreements under the laws of the
jurisdiction of organization of such Foreign Subsidiary as are analogous to the
Collateral Documents described under clauses (v), (w), (x) and (y) above), and
(II) take all such actions and execute and deliver, or cause to be executed and
delivered, all such documents, instruments, agreements, and certificates as are
similar to those described in Sections 3.1(b), 3.1(f), 3.1(h) and 3.1(i) of the
Original Credit Agreement.

(4) With respect to each such Subsidiary described in paragraph (1) through
(3) of this Section 5.10, Borrower shall promptly send to Administrative Agent
written notice setting forth with respect to such Person (i) the date on which
such Person became a Subsidiary of Borrower, and (ii) all of the data required
to be set forth in Schedules 4.1 and 4.2 with respect to all Subsidiaries of
Borrower, and such written notice shall be deemed to supplement Schedules 4.1
and 4.2 for all purposes hereof.

(5) Notwithstanding anything in this Section 5.10 to the contrary, in no event
shall (i) any Subsidiary that is otherwise prohibited by Applicable Law from
guaranteeing the Obligations or pledging its assets in support of the
Obligations be required to execute a Counterpart Agreement or any Collateral
Document or take any other action set forth in paragraph (1), (2) or (3) of this
Section 5.10 (including, without limitation, Biovail Insurance) and
(ii) Borrower or any Guarantor be required to pledge the Equity Interests of any
Subsidiary in support of the Obligations if such pledge is otherwise prohibited
by Applicable Law.

(6) Notwithstanding anything in this Agreement or any other Credit Document to
the contrary (including this Section 5.10 and Sections 5.11 and 5.13), no Credit
Document shall require the creation or perfection of pledges of or security
interests in, or the obtaining of title insurance, legal opinions or other
deliverables with respect to, particular assets of the Credit Parties, if, and
for so long as, Administrative Agent, in consultation with Borrower, determines
in writing that the cost of creating or perfecting such pledges or security
interests in such assets, or obtaining such title insurance, legal opinions or
other deliverables in respect of such assets (taking into account any adverse
tax consequences to Borrower and its Subsidiaries (including the imposition of
withholding or other material taxes)), shall be excessive in view of the
benefits to be obtained by the Secured Parties therefrom. Administrative Agent
may grant extensions of time for the creation and perfection of security
interests in or the obtaining of title insurance, legal opinions or other
deliverables with respect to particular assets or the provision of the Guarantee
(or any other guarantee in support of the Obligations) by any Subsidiary where
it determines that such action cannot be accomplished without undue effort or
expense by the time or times at which it would otherwise be required to be
accomplished by this Agreement or the other Credit Documents.

 

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(7) If it becomes illegal for any Lender to hold or benefit from a Lien over
real or personal property pursuant to any law of the United States of America,
such Lender may, in its sole discretion, notify the Administrative Agent and
disclaim any benefit of such security interest to the extent of such illegality,
but the election by any Lender to so disclaim the benefit of such security
interest shall not invalidate or render unenforceable such Lien for the benefit
of each of the other Lenders.

5.11 Additional Material Real Estate Assets. In the event that any Credit Party
acquires a Material Real Estate Asset or a Real Estate Asset owned or leased on
the Third Restatement Date becomes a Material Real Estate Asset and such
interest has not otherwise been made subject to the Lien of the Collateral
Documents in favor of Collateral Agent, for the benefit of Secured Parties, then
such Credit Party shall promptly take all such actions and execute and deliver,
or cause to be executed and delivered, all such mortgages, documents,
instruments, agreements, opinions and certificates similar to those described in
Sections 3.1(h) and 3.1(i) of the Original Credit Agreement with respect to each
such Material Real Estate Asset that Collateral Agent shall reasonably request
to create in favor of Collateral Agent, for the benefit of Secured Parties, a
valid and, subject to any filing and/or recording referred to herein, perfected
First Priority security interest in such Material Real Estate Asset. In addition
to the foregoing, Borrower shall, at the request of Collateral Agent, deliver,
from time to time, to Collateral Agent such appraisals as are required by
Applicable Law of Material Real Estate Assets with respect to which Collateral
Agent has been granted a Lien.

5.12 Interest Rate Protection. No later than ninety (90) days following the
Third Restatement Date and at all times thereafter until the third anniversary
of the Third Restatement Date, Borrower shall obtain and cause to be maintained
protection against fluctuations in interest rates pursuant to one or more
Interest Rate Agreements in form and substance reasonably satisfactory to
Administrative Agent, in order to ensure that for a period of not less than
three years after the Third Restatement Date, no less than 35% of the aggregate
principal amount of the total Indebtedness for borrowed money of Borrower and
its Subsidiaries then outstanding is either (i) subject to such Interest Rate
Agreements or (ii) Indebtedness that bears interest at a fixed rate.

5.13 Further Assurances. At any time or from time to time, each Credit Party
will, at its expense, promptly execute, acknowledge and deliver such further
documents and do such other acts and things as Administrative Agent or
Collateral Agent may reasonably request in order to effect fully the purposes of
the Credit Documents. In furtherance and not in limitation of the foregoing,
each Credit Party shall take such actions as Administrative Agent or Collateral
Agent may reasonably request from time to time to ensure that the Obligations
are guarantied by the Guarantors and are secured by substantially all of the
assets of Borrower and the other Guarantors (subject to the limitations
contained herein and in the other Credit Documents).

5.14 Maintenance of Ratings. At all times, Borrower shall use commercially
reasonable efforts to maintain (x) a corporate family rating issued by Moody’s
and a corporate credit rating issued by S&P and (y) public ratings issued by
Moody’s and S&P with respect to its senior secured debt.

5.15 Post-Closing Matters. Borrower and its Subsidiaries, as applicable, agree
to execute and deliver the documents and take the actions set forth on Schedule
5.15, in each case within the time limits specified on such schedule (unless
Administrative Agent, in its sole and absolute discretion, shall have agreed to
any particular longer period).

 

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5.16 Canadian Employee Benefit Plans. Each Canadian Credit Party shall:

(a) with respect to each Canadian Pension Plan, pay all contributions, premiums
and payments when due in accordance with its terms and applicable law; and

(b) promptly deliver to the Administrative Agent copies of: (A) annual
information returns, actuarial valuations and any other reports which have been
filed with a Governmental Authority with respect to each Canadian Pension Plan;
and (B) any direction, order, notice, ruling or opinion that a Canadian Credit
Party may receive from a Governmental Authority with respect to any Canadian
Employee Benefit Plan.

SECTION 6. NEGATIVE COVENANTS

Each Credit Party covenants and agrees that, so long as any Commitment is in
effect and until payment in full of all principal of and interest on each Loan
and all fees, expenses and other amounts (other than contingent amounts not yet
due) payable under any Credit Document and cancellation or expiration of all
Letters of Credit, such Credit Party shall perform, and shall cause each of its
Subsidiaries to perform, all covenants in this Section 6.

6.1 Indebtedness. No Credit Party shall, nor shall it permit any of its
Subsidiaries to, directly or indirectly, create, incur, assume or guaranty, or
otherwise become or remain directly or indirectly liable with respect to any
Indebtedness, except:

(a) the Obligations;

(b) Senior Notes in an aggregate principal amount not to exceed $4,350,000,000;

(c) Indebtedness of any Subsidiary of Borrower to Borrower or any other such
Subsidiary or of Borrower to any of its Subsidiaries; provided that (i) all such
Indebtedness, if owed to a Credit Party, shall be evidenced by the Intercompany
Note or another promissory note and shall be subject to a First Priority Lien
pursuant to the applicable Collateral Document, (ii) all such Indebtedness owing
by a Credit Party to a Subsidiary that is not a Credit Party shall be unsecured
and subordinated in right of payment to the payment in full of the Obligations
pursuant to the terms of a subordination agreement with respect to such
Indebtedness substantially in the form of Exhibit J-2 among the Credit Parties
and such Subsidiaries party to such Indebtedness and (iii) in respect of any
Indebtedness owing by a Subsidiary that is not a Credit Party to a Credit Party,
such Indebtedness is permitted as an Investment under the proviso to
Section 6.6(d);

(d) Indebtedness incurred by Borrower or any of its Subsidiaries arising from
agreements providing for indemnification, adjustment of purchase price or
similar obligations (including Indebtedness consisting of the deferred purchase
price of property acquired in a Permitted Acquisition) or from guaranties or
letters of credit, surety bonds, performance bonds or similar obligations
securing the performance of Borrower or any such Subsidiary pursuant to such
agreements, in connection with Permitted Acquisitions or permitted dispositions
of any business, assets or Subsidiary of Borrower or any of its Subsidiaries;

(e) Indebtedness which may be deemed to exist pursuant to any guaranties,
performance, surety, statutory, appeal or similar obligations incurred in the
ordinary course of business;

(f) Indebtedness in respect of netting services, overdraft protections and
otherwise in connection with deposit accounts;

 

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(g) guaranties in the ordinary course of business of the obligations of
suppliers, customers, franchisees of and licensees to and of Borrower and its
Subsidiaries;

(h) guaranties by Borrower of Indebtedness of a Subsidiary of Borrower or
guaranties by a Subsidiary of Borrower of Indebtedness of Borrower or any other
such Subsidiary, in each case with respect to Indebtedness otherwise permitted
to be incurred pursuant to this Section 6.1; provided that (i) if the
Indebtedness that is being guarantied is unsecured and/or subordinated to the
Obligations, the guaranty thereof shall be unsecured and/or subordinated to the
Obligations to the same extent and (ii) in respect of any guaranty by a Credit
Party of Indebtedness of a Subsidiary that is not a Credit Party, such guaranty
is permitted as an Investment under Section 6.6(d);

(i) Indebtedness described in Schedule 6.1 (other than Indebtedness described in
clauses (a) or (b) of this Section 6.1);

(j) Indebtedness of Borrower or its Subsidiaries with respect to Capital Leases
or purchase money Indebtedness in an aggregate principal amount at any time
outstanding not to exceed the greater of (x) $50,000,000 and (y) .50% of
Consolidated Total Assets; provided, any such Indebtedness shall be secured only
by the asset acquired in connection with the incurrence of such Indebtedness;

(k) Indebtedness of a Person or Indebtedness attaching to assets of a Person
that, in either case, becomes a Subsidiary of Borrower or Indebtedness attaching
to assets that are acquired by Borrower or any of its Subsidiaries, in each case
after the Third Restatement Date; provided that (x) on a Pro Forma Basis
(including, for the avoidance of doubt, Subordinated Indebtedness) after giving
effect to the incurrence of such Indebtedness (including the use of proceeds
thereof), the Leverage Ratio of Borrower shall be less than or equal to 5.25 to
1.00, as of the last day of the most recently ended Fiscal Quarter for which
financial statements were required to have been delivered pursuant to
Section 5.1(a) or (b), (y) such Indebtedness existed at the time such Person
became a Subsidiary or at the time such assets were acquired and, in each case,
was not created in anticipation thereof and (z) such Indebtedness is not
guaranteed in any respect by Borrower or any Subsidiary (other than by any such
Person that so becomes a Subsidiary);

(l) Indebtedness representing the deferred purchase price of property (including
Intellectual Property) or services, including earn-out obligations, purchase
price adjustments, escrow arrangements or other arrangements representing
deferred payments incurred in connection with the acquisition of equity or
assets permitted or consented to hereunder;

(m) (i) Indebtedness under any Hedge Agreement (and any guarantees thereof),
(ii) Indebtedness under any Cash Management Agreement (and any guarantees
thereof) and (iii) Indebtedness arising under any Currency Agreement or Interest
Rate Agreement (and, in each case, any guarantees thereof), including any
extensions thereof and such increases, if any, as shall result when the
underlying obligations of such agreements are marked to market or increased to
address accrued interest on the obligation relating to such agreement; provided,
that, with respect to Indebtedness under Hedge Agreements, Interest Rate
Agreements or Currency Agreements (or Guarantees thereof), such Indebtedness is
entered into in the ordinary course of business and not for speculative
purposes;

(n) Indebtedness in respect of performance and surety bonds and completion
guarantees provided by Borrower or any of its Subsidiaries;

 

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(o) Indebtedness of Borrower or any Subsidiary as an account party in respect of
trade letters of credit;

(p) [Reserved];

(q) other Indebtedness (including, for the avoidance of doubt, Subordinated
Indebtedness) of Borrower or any Guarantor; provided that on a Pro Forma Basis
after giving effect to the incurrence of such Indebtedness (including the use of
proceeds thereof including, without limitation, after the date of incurrence or
issuance of any such Indebtedness pursuant to any escrow arrangement, delayed
draw, delayed closing or similar or analogous arrangement), (x) no Default or
Event of Default has occurred and is continuing or would result therefrom and
(y) the Leverage Ratio of Borrower and its Subsidiaries shall be less than or
equal to 5.25 to 1.00, as of the last day of the most recently ended Fiscal
Quarter for which financial statements were required to have been delivered
pursuant to Section 5.1(a) or (b);

(r) provided that no Default or Event of Default has occurred and is continuing
or would result therefrom, the incurrence or issuance by Borrower or any
Subsidiary of Borrower of Indebtedness which serves to extend, replace, refund,
renew, defease or refinance any Indebtedness incurred as permitted under clause
(b), (i), (j), (k), (r), (s) or (v) of this Section 6.1 or any Indebtedness
issued to so extend, replace, refund, renew, defease or refinance such
Indebtedness, or any Indebtedness, including additional Indebtedness, incurred
to pay premiums (including tender premiums), defeasance costs and fees and
expenses in connection therewith (the “Refinancing Indebtedness”); provided,
however, that such Refinancing Indebtedness:

(1) has a final maturity date later than the date that is 91 days after the
latest Term Loan Maturity Date, and has a weighted average life to the date of
the latest Term Loan Maturity Date that is not less than the weighted average
life to the date of the latest Term Loan Maturity Date of the Indebtedness being
extended, replaced, renewed, defeased, refunded or refinanced,

(2) to the extent such Refinancing Indebtedness extends, replaces, refunds,
renews, defeases or refinances (x) Indebtedness subordinated or pari passu to
the Obligations, such Refinancing Indebtedness is subordinated or pari passu to
the Obligations at least to the same extent (as determined in good faith by the
board of directors of Borrower) as the Indebtedness being extended, replaced,
renewed, defeased, refinanced or refunded or (y) Disqualified Equity Interests
such Refinancing Indebtedness must be Disqualified Equity Interests,

(3) shall have direct and contingent obligors that are the same as (or, in the
case of contingent obligors, no more expansive than) the direct and contingent
obligors, respectively, of the refinanced Indebtedness, or

(4) shall not be secured by any assets that were not required to be used to
secure the Indebtedness being extended, replaced, renewed, defeased, refunded or
refinanced;

(s) Permitted Secured Notes;

(t) Indebtedness owed to any Person (including obligations in respect of letters
of credit for the benefit of such Person) providing workers’ compensation,
health, death, disability or other employee benefits or property, casualty or
liability insurance or self-insurance, or other Indebtedness regarding workers’
compensation claims pursuant to reimbursement or indemnification obligations to
such Person, in each case incurred in the ordinary course of business;

 

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(u) Indebtedness of Borrower or any of its Subsidiaries consisting of (x) the
financing of insurance premiums or (y) take-or-pay obligations contained in
supply arrangements, in each case, incurred in the ordinary course of business;
and

(v) Indebtedness of Subsidiaries of Borrower (other than Biovail Insurance and
any other such Subsidiary that is not permitted by Applicable Law to guaranty
the Obligations) that are not Credit Parties and that are organized under the
laws of any jurisdiction other than the United States of America consisting of
working capital credit facilities in an aggregate principal amount at any time
outstanding under this clause (v) not to exceed the greatest of (i) 2.5% of the
consolidated total revenues for the four Fiscal Quarter period most recently
ended, (ii) 2.5% of the consolidated total assets, as determined in accordance
with GAAP, as of the applicable date of determination, in each case of subclause
(i) and (ii), of all Subsidiaries of Borrower (other than Biovail Insurance and
any other such Subsidiary that is not permitted by Applicable Law to guaranty
the Obligations) that are not Credit Parties, and (iii) $40,000,000.

6.2 Liens. No Credit Party shall, nor shall it permit any of its Subsidiaries
to, directly or indirectly, create, incur, assume or permit to exist any Lien on
or with respect to any property or asset of any kind (including any document or
instrument in respect of goods or accounts receivable) of Borrower or any of its
Subsidiaries, whether now owned or hereafter acquired, or any income, profits or
royalties therefrom, or file or permit the filing of any financing statement or
other similar notice of any Lien with respect to any such property, asset,
income, profits or royalties under the UCC of any State, the PPSA of any
province or territory or under any similar recording or notice statute of
jurisdictions in which Credit Parties are organized or under any applicable
intellectual property laws, rules or procedures, except:

(a) Liens in favor of Collateral Agent for the benefit of Secured Parties
granted pursuant to any Credit Document;

(b) Liens for Taxes not yet due and payable or that are being contested in
accordance with Section 5.3;

(c) statutory Liens of landlords, banks (and rights of set-off), of carriers,
warehousemen, mechanics, repairmen, workmen and materialmen, and other Liens
imposed by law (other than any such Lien imposed pursuant to Section 430(k) of
the Internal Revenue Code or ERISA or a violation of Section 436 of the Internal
Revenue Code or, in respect of a Canadian Credit Party, a Lien imposed pursuant
to pension benefits standards legislation; provided that, in each case, such
Liens shall be governed by Sections 5.1(g), 5.1(h), 8.1(j) and 8.1(k) and not
this Section 6.2), in each case incurred in the ordinary course of business
(i) for amounts not yet overdue or (ii) for amounts that are overdue and that
(in the case of any such amounts overdue for a period in excess of five days)
are being contested in good faith by appropriate proceedings, so long as such
reserves or other appropriate provisions, if any, as shall be required by GAAP
shall have been made for any such contested amounts;

(d) Liens incurred in the ordinary course of business in connection with
workers’ compensation, unemployment insurance and other types of social
security, or to secure the performance of tenders, statutory obligations, surety
and appeal bonds, bids, leases, government contracts, trade contracts,
performance and return of money bonds and other similar obligations (exclusive
of obligations for the payment of borrowed money or other Indebtedness), so long
as no foreclosure, sale or similar proceedings have been commenced with respect
to any portion of the Collateral on account thereof;

 

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(e) easements, rights of way, restrictions, encroachments, encumbrances and
other minor defects or irregularities in title, in each case which do not and
will not interfere in any material respect with the ordinary conduct of the
business of Borrower or any of its Subsidiaries;

(f) any interest or title of a lessor, lessee, sublessor or sublessee under any
lease or sublease permitted hereunder and any interest or title of a licensor,
licensee, sublicensor or sublicensee under any license or sublicense permitted
hereunder;

(g) Liens solely on any cash earnest money deposits, escrow arrangements or
similar arrangements made by Borrower or any of its Subsidiaries in connection
with any letter of intent or purchase agreement permitted hereunder;

(h) purported Liens evidenced by the filing of precautionary UCC or PPSA
financing statements (or any similar precautionary filings) relating solely to
operating leases of personal property entered into in the ordinary course of
business;

(i) Liens in favor of customs and revenue authorities arising as a matter of law
to secure payment of customs duties in connection with the importation of goods;

(j) any zoning or similar law or right reserved to or vested in any Governmental
Authority to control or regulate the use of any real property;

(k) outbound licenses of patents, copyrights, trademarks and other Intellectual
Property rights granted by Borrower or any of its Subsidiaries in the ordinary
course of business and not interfering in any material respect with the ordinary
conduct of, or materially detracting from the aggregate value of, the business
of Borrower or such Subsidiary (taking into account the value of the license as
well);

(l) Liens described in Schedule 6.2 or on a title report delivered pursuant to
Section 3.1(e)(iii) of the Original Credit Agreement and any modifications,
renewals and extensions thereof and any Lien granted as a replacement or
substitute therefor; provided that (x) such Lien shall not apply to any other
property or asset of Borrower or any Subsidiary other than improvements thereon
or proceeds from the disposition of such asset and (y) such Lien shall secure
only those obligations which it secures on the date hereof and any refinancing,
extensions, renewals or replacements thereof that do not increase the
outstanding principal amount thereof (except by an amount not greater than
accrued and unpaid interest with respect to such original obligations and any
premium, fees, costs and expenses incurred in connection with such extension,
renewal or refinancing) and, in the case of any such obligations constituting
Indebtedness, that are permitted under Section 6.1(r) as Refinancing
Indebtedness in respect thereof;

(m) Liens securing Indebtedness permitted pursuant to Section 6.1(j) (and any
Refinancing Indebtedness in respect thereof permitted under Section 6.1(r));
provided, any such Lien shall encumber only the asset acquired with the proceeds
of such Indebtedness;

(n) Liens securing Indebtedness permitted by Sections 6.1(k) (and any
Refinancing Indebtedness in respect thereof permitted under Section 6.1(r)),
provided any such Lien shall encumber only those assets which secured such
Indebtedness at the time such assets were acquired by Borrower or its
Subsidiaries;

 

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(o) other Liens on assets other than the Collateral securing obligations in an
aggregate principal amount not to exceed $75,000,000 at any time outstanding;

(p) Liens securing Indebtedness permitted by Section 6.1(m);

(q) Liens arising out of judgments, decrees, orders or awards that do not
constitute an Event of Default under Section 8.1(h);

(r) Liens securing Indebtedness permitted by Sections 6.1(q) and (s); provided
that either (x) on a Pro Forma Basis after giving effect to the incurrence of
such Indebtedness (and the use of proceeds thereof) Borrower and its
Subsidiaries shall be in compliance with each of the covenants set forth in
Section 6.7 as of the last day of the most recently ended Fiscal Quarter, as if
such Indebtedness had been outstanding on the last day of such Fiscal Quarter or
(y) the Cash proceeds of Indebtedness secured by such Liens are applied to
prepay Term Loans in accordance with Section 2.15;

(s) Liens on assets of any Subsidiary of Borrower (other than Biovail Insurance
and any other such Subsidiary that is not permitted by Applicable Law to
guaranty the Obligations) that is not a Credit Party and that is organized in a
jurisdiction other than the United States of America to the extent such Liens
secure Indebtedness of such Subsidiary permitted under Section 6.1(v);

(t) Liens granted by any Canadian Credit Party to a landlord to secure the
payment of rent and other obligations under a lease with such landlord for
premises situated in the Province of Québec; provided that such Lien (i) is
limited to the tangible assets located at or about such leased premises and
(ii) is incurred in the ordinary course of business (a) for amounts not yet
overdue or (b) for amounts that are overdue and that (in the case of any such
amounts overdue for a period in excess of five days) are being contested in good
faith by appropriate proceedings, so long as such reserves or other appropriate
provisions, if any, as shall be required by GAAP shall have been made for any
such contested amounts;

(u) Liens arising by reason of deposits necessary to obtain standby letters of
credit in the ordinary course of business;

(v) Liens in connection with repurchase obligations referred to in clause
(vi) of the definition of the term “Cash Equivalents”;

(w) in connection with the sale or transfer of any Equity Interests or other
assets in a transaction permitted by Section 6.8, customary rights and
restrictions contained in agreements relating to such sale or transfer pending
the completion thereof;

(x) in the case of any Joint Venture, any put and call arrangements related to
its Equity Interests set forth in its Organizational Documents or any related
joint venture or similar agreement;

(y) Liens in the nature of the right of setoff in favor of counterparties to
contractual agreements with Borrower or any of its Subsidiaries in the ordinary
course of business; and

(z) Liens in favor of customs and revenue authorities arising as a matter of law
to secure payment of customs duties in connection with the importation of goods
in the ordinary course of business.

 

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provided, however, that no reference herein to Liens permitted hereunder
(including Permitted Liens), including any statement or provision as to the
acceptability of any Liens (including Permitted Liens), shall in any way
constitute or be construed as to provide for a subordination of any rights of
the Agents, Lenders or other Secured Parties hereunder or arising under any of
the other Credit Documents in favor of such Liens.

6.3 No Further Negative Pledges. Except with respect to (a) specific property
encumbered to secure payment of particular Indebtedness or to be sold pursuant
to an executed agreement with respect to a permitted Asset Sale or other sale or
disposition permitted by Section 6.8, (b) restrictions by reason of customary
provisions restricting assignments, subletting or other transfers contained in
leases, licenses and similar agreements entered into in the ordinary course of
business (provided that such restrictions are limited to the property or assets
secured by such Liens or the property or assets subject to such leases, licenses
or similar agreements, as the case may be), (c) restrictions and conditions
imposed by law, and (d) restrictions identified on Schedule 6.3, no Credit Party
nor any of its Subsidiaries shall enter into any agreement prohibiting the
creation or assumption of any Lien upon any of its properties or assets, whether
now owned or hereafter acquired, to secure the Obligations.

6.4 Restricted Junior Payments. No Credit Party shall, nor shall it permit any
of its Subsidiaries through any manner or means or through any other Person to,
directly or indirectly, declare, order, pay, make or set apart, or agree to
declare, order, pay, make or set apart, any sum for any Restricted Junior
Payment except for:

(a) the declaration and payment of dividends or the making of other
distributions by any Subsidiary of Borrower ratably to its direct equity
holders;

(b) the redemption, repurchase, retirement, defeasance or other acquisition of
any Equity Interests, including any accrued and unpaid dividends thereon, or
Subordinated Indebtedness of Borrower or any Equity Interests of any direct or
indirect parent company of Borrower, in exchange for, or out of the proceeds of,
the substantially concurrent sale (other than to a Subsidiary) of, Equity
Interests of Borrower or any direct or indirect parent company of Borrower to
the extent contributed to Borrower (in each case, other than any Disqualified
Equity Interests) or Subordinated Indebtedness incurred under Section 6.1;
provided that any such Subordinated Indebtedness shall be Refinancing
Indebtedness;

(c) refinancings of Indebtedness permitted by Section 6.1;

(d) any Restricted Junior Payment to pay for the repurchase, retirement or other
acquisition or retirement for value of Equity Interests (other than Disqualified
Equity Interests) of Borrower held by any future, present or former employee,
director, officer or consultant of Borrower or any of its Subsidiaries or any
direct or indirect parent companies pursuant to any management equity plan or
stock option plan or any other management or employee benefit plan or agreement
(including, for the avoidance of doubt, any principal and interest payable on
any notes issued by Borrower or any direct or indirect parent company of
Borrower in connection with any such repurchase, retirement or other
acquisition), or any stock subscription or shareholder agreement, including any
Equity Interest rolled over by management of Borrower or any direct or indirect
parent company of Borrower in connection with the 2010 Transactions; provided,
that the aggregate amount of Restricted Junior Payments made under this clause
(d) shall not exceed in any calendar year $25,000,000 (with unused amounts for
any year being carried over to the next succeeding year, but not to any
subsequent year, and the permitted amount for each year shall be used prior to
any amount carried over from the previous year); provided further that such
amount in any calendar year may be increased by an amount not to exceed:

(i) the cash proceeds of key man life insurance policies received by Borrower or
its Subsidiaries after the Original Closing Date; less

 

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(ii) the amount of any Restricted Junior Payments previously made with the cash
proceeds described in subclause (i) of this clause (d);

(e) cashless repurchases of Equity Interests deemed to occur upon exercise of
stock options or warrants if such Equity Interests represent a portion of the
exercise price of such options or warrants;

(f) cash payments in lieu of issuing fractional shares in connection with the
exercise of warrants, options or other securities convertible into or
exchangeable for Equity Interests of Borrower or any direct or indirect parent
company of Borrower;

(g) so long as no Default or Event of Default has occurred and is continuing,
(i) Borrower may repurchase shares of Borrower’s common stock within six months
before or after any conversion date for Borrower Convertible Notes, which
repurchases may be in an aggregate amount not to exceed the number of shares of
Borrower’s common stock delivered upon conversion of Borrower Convertible Notes
on such conversion date and (ii) Borrower may repurchase shares of Borrower’s
common stock within six months before or after the settlement of any written
call option agreements entered into in connection with the issuance of the VPI
Convertible Notes, which repurchases may be in an aggregate amount not to exceed
the number of shares of Borrower’s common stock delivered upon settlement of
such written call options;

(h) other Restricted Junior Payments in an aggregate amount taken together with
all other Restricted Junior Payments made pursuant to this clause (h) not to
exceed $200,000,000 (reduced on a dollar for dollar basis by outstanding
Investments pursuant to clause (i) of Section 6.6, other than Investments under
such clause made using the CNI Growth Amount) at any time; provided that such
amount shall be increased (but not decreased) by the CNI Growth Amount as in
effect immediately prior to the time of making of such Restricted Junior
Payment; and

(i) Restricted Junior Payments in connection with the Pre-Merger Special
Dividend and/or the Post-Merger Special Dividend in an aggregate amount not to
exceed $10,000,000.

6.5 Restrictions on Subsidiary Distributions. Except as provided herein, no
Credit Party shall, nor shall it permit any of its Subsidiaries to, create or
otherwise cause or suffer to exist or become effective any consensual
encumbrance or restriction of any kind on 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 of its property or assets to Borrower or any other Subsidiary of Borrower
other than restrictions (i) imposed by law or by any Credit Document, (ii) in
agreements evidencing Indebtedness permitted by Section 6.1(k) that impose
restrictions on the property so acquired, and any amendments, modifications,
extensions or renewals thereof (including any such extension or renewal arising
as a result of an extension, renewal or refinancing of any Indebtedness
containing such restriction or condition) that do not materially expand the
scope of any such restriction or condition taken as a whole, (iii) by reason of
customary provisions restricting assignments, subletting or other transfers
contained in leases, licenses, Joint Venture agreements and similar agreements
entered into in the ordinary course of business, (iv) that are or were created
by virtue of any transfer of, agreement to transfer or option or right with
respect to any property, assets or Equity Interests not otherwise prohibited
under this Agreement, (v) in the case of any Subsidiary that is not directly or
indirectly

 

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wholly owned by Borrower, restrictions and conditions imposed by its
Organizational Documents or any related joint venture, shareholders’ or similar
agreement; provided that such restrictions and conditions apply only to such
Subsidiary and to any Equity Interests in such Subsidiary, or (vi) identified on
Schedule 6.5, and any amendments, modifications, extensions or renewals thereof
(including any such extension or renewal arising as a result of an extension,
renewal or refinancing of any Indebtedness containing such restriction or
condition) that do not materially expand the scope of any such restriction or
condition taken as a whole.

6.6 Investments. No Credit Party shall, nor shall it permit any of its
Subsidiaries to, directly or indirectly, make or own any Investment in any
Person, including any Joint Venture, except:

(a) Investments in Cash and Cash Equivalents;

(b) equity Investments owned as of the Third Restatement Date in any Subsidiary
and Investments made after the Third Restatement Date in any Guarantor;

(c) Investments (i) received in connection with the bankruptcy or reorganization
of, or settlement of delinquent accounts and disputes with, customers and
suppliers, in each case in the ordinary course of business and (ii) consisting
of deposits, prepayments and other credits to suppliers made in the ordinary
course of business consistent with the past practices of Borrower or any of its
Subsidiaries, as applicable;

(d) intercompany loans and advances to the extent permitted under Section 6.1(c)
and other Investments (i) in (including Guarantees of Indebtedness of) any
Credit Party and (ii) in (including (without duplication for purposes of the
proviso to this clause (ii)) Guarantees of Indebtedness of) Subsidiaries of
Borrower which are not Guarantors; provided that such Investments under this
clause (ii) shall not exceed at any one time outstanding an aggregate amount of
$200,000,000;

(e) Permitted Interim Investments and intercompany loans and advances and
capital contributions by Credit Parties to Subsidiaries that are not Credit
Parties in connection with any Permitted Interim Investment; provided, that, for
the avoidance of doubt, the acquisition of the remaining Equity Interests of a
Person such that such Person becomes a wholly owned Subsidiary of Borrower shall
either (x) be subject to the provisions of Section 6.8(h) or (y) be made
pursuant to and in compliance with Section 6.6(d)(ii) or 6.6(i);

(f) loans and advances to employees of Borrower and its Subsidiaries made in the
ordinary course of business in an aggregate principal amount not to exceed
$25,000,000;

(g) Permitted Acquisitions permitted under Section 6.8;

(h) Investments described in Schedule 6.6 and any modification, replacement,
renewal or extension thereof to the extent not involving an additional
Investment;

(i) (a) other Investments in an aggregate amount not to exceed $200,000,000
(reduced on a dollar for dollar basis by Restricted Junior Payments pursuant to
clause (h) of Section 6.4, other than Restricted Junior Payments under such
clause made using the CNI Growth Amount) at any time outstanding; provided that
such amount shall be increased (but not decreased) by the CNI Growth Amount as
in effect immediately prior to the time of making of such Investments and
(b) Investments in Pele Nova Biotecnologia S.A. at any time outstanding not to
exceed $8,000,000;

 

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(j) Investments represented by (i) any Hedge Agreement (and any guarantees
thereof), (ii) any Cash Management Agreement (and any guarantees thereof) and
(iii) any Interest Rate Agreement or Currency Agreement (and any guarantees
thereof); provided, that, with respect to Indebtedness under Hedge Agreements
for Interest Rate Agreements or Currency Agreements (or Guarantees thereof),
such Indebtedness is entered into in the ordinary course of business and not for
speculative purposes;

(k) Investments received in connection with the disposition of any asset
permitted by Section 6.8;

(l) Investments (which may take the form of asset contributions) in (x) Joint
Ventures consisting primarily of a Prescription Drug Business, (y) Joint
Ventures involving aesthetic product lines of Borrower or its Subsidiaries and
consisting of any or all of the Sculptra, Succeev, Artesense, Selphyl,
Viscountour, Renova, Kinerase and Refissa products, and/or (z) Joint Ventures
(in addition to those described in clauses (x) and (y)) in an aggregate amount
not exceeding $150,000,000 in any calendar year (with unused amounts for any
year being carried over to the next succeeding year, but not to any subsequent
year, and the permitted amount for each year shall be used prior to any amount
carried over from the previous year);

(m) Investments of any Person existing at the time such Person becomes a
Subsidiary of Borrower or consolidates or merges with Borrower or any of its
Subsidiaries (including in connection with a Permitted Acquisition) and any
modification, replacement, renewal or extension thereof to the extent not
involving an additional Investment so long as such Investments were not made in
contemplation of such Person becoming a Subsidiary of Borrower or of such
consolidation or merger; and

(n) extensions of trade credit in the ordinary course of business.

Notwithstanding the foregoing, in no event shall any Credit Party make any
Investment which results in or facilitates in any manner any Restricted Junior
Payment not otherwise permitted under the terms of Section 6.4.

6.7 Financial Covenants.

(a) Interest Coverage Ratio. Borrower shall not permit the Interest Coverage
Ratio as of the last day of any Fiscal Quarter, beginning with the Fiscal
Quarter ending December 31, 2011, to be less than 3.00:1.00.

(b) Secured Leverage Ratio. Borrower shall not permit the Secured Leverage Ratio
as of the last day of (i) the Fiscal Quarter ending December 31, 2011, to exceed
1.75 to 1.0 and (ii) any subsequent Fiscal Quarter, beginning with Fiscal
Quarter ending March 31, 2012, to exceed 2.50 to 1.0.

6.8 Fundamental Changes; Disposition of Assets; Acquisitions. No Credit Party
shall, nor shall it permit any of its Subsidiaries to, enter into any
transaction of merger, amalgamation, arrangement, reorganization or
consolidation, or liquidate, wind up or dissolve itself (or suffer any
liquidation or dissolution), or convey, sell, lease or license, exchange,
transfer or otherwise dispose of, in one transaction or a series of
transactions, all or any part of its business, assets or property of any kind
whatsoever, whether real, personal or mixed and whether tangible or intangible,
whether now owned or hereafter acquired, leased or licensed, or acquire by
purchase or otherwise (other than purchases or other acquisitions of inventory,
materials and equipment and capital expenditures in the ordinary course of
business) the business or fixed assets of, or stock or other evidence of
beneficial ownership of, any Person or any division or line of business or other
business unit of any Person, except:

(a) any Subsidiary of Borrower may be (i) merged or amalgamated with or merged
into Borrower or any other Subsidiary of Borrower; provided that (A) in the case
of such a merger or amalgamation involving Borrower, Borrower shall be the
surviving Person or a Person that continues as an amalgamated corporation and
(B) in the case of such a merger or amalgamation involving any other Guarantor
(and not involving Borrower), the surviving Person, or a Person that continues
as an amalgamated corporation, shall be a Guarantor, or (ii) other than with
respect to Borrower, liquidated, wound up or dissolved if Borrower determines in
good faith that such liquidation, winding up or dissolution is in the best
interest of Borrower and is not materially disadvantageous to the Lenders;

 

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(b) sales or other dispositions of assets or property that do not constitute
Asset Sales (which sales or other dispositions may take the form of a merger,
amalgamation or similar transaction);

(c) Asset Sales (which Asset Sale may take the form of a merger, amalgamation or
similar transaction), the proceeds of which (valued at the principal amount
thereof in the case of non-Cash proceeds consisting of notes or other debt
Securities and valued at fair market value in the case of other non-Cash
proceeds) when aggregated with the proceeds of all other Asset Sales made within
the same Fiscal Year, are less than $200,000,000 (with the amount for any Fiscal
Year increased by an amount equal to the excess, if any, of such amount for the
immediately preceding Fiscal Year over the amount of proceeds from Asset Sales
made pursuant to this clause (c) in such immediately preceding Fiscal Year);
provided that (1) the consideration received for such assets shall be in an
amount at least equal to the fair market value thereof (determined in good faith
by the board of directors of Borrower (or similar governing body) of Borrower or
the applicable Subsidiary or Credit Party for Asset Sales with a fair market
value in excess of $75,000,000), (2) no less than 75% thereof shall be paid in
Cash, and (3) the Net Asset Sale Proceeds thereof shall be applied as required
by Section 2.14(a);

(d) Asset Sales consisting of obsolete, worn out or surplus assets or property,
including, for greater certainty, Intellectual Property;

(e) Asset Sales consisting of sale and leaseback transactions permitted by
Section 6.10; provided that the Net Asset Sale Proceeds in excess of $50,000,000
from any such Asset Sale shall be applied as required by Section 2.14(a);

(f) Specified Asset Disposition; provided that the Net Asset Sale Proceeds
thereof shall be applied as required by Section 2.14(a);

(g) Asset Sales of property to the extent that (i) such property is concurrently
exchanged for credit against the purchase price of similar replacement property
or (ii) the proceeds of such Asset Sales are promptly applied to the purchase
price of such replacement property;

(h) Permitted Acquisitions (which acquisition may take the form of a merger,
amalgamation or similar transaction so long as such merger, amalgamation or
similar transaction would be permitted by clause (a) of this Section 6.8 if the
acquired Person was, initially, a Subsidiary of Borrower); provided that (x) in
respect of acquisitions of assets that are not or have not become subject to the
Collateral Documents and/or acquisitions of Equity Interests of Persons (other
than Excluded Subsidiaries) that do not become Guarantors or are not owned by a
Credit

 

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Party, the consideration (other than Equity Interests of Borrower issued in
payment of a portion of such consideration and the net proceeds of the issuance
of Equity Interests of Borrower to the extent used to pay a portion of such
consideration) shall not exceed, collectively with any Investments then
outstanding under Section 6.6(d)(ii) in Persons other than Credit Parties,
$200,000,000 per Fiscal Year and (y) immediately prior to such Permitted
Acquisition and on a Pro Forma Basis after giving effect thereto, Borrower and
its Subsidiaries shall be in compliance with each of the covenants set forth in
Section 6.7 as of the last day of the most recently ended Fiscal Quarter;

(i) Investments made in accordance with Section 6.6, other than pursuant to
clause (g) thereof (which Investment may take the form of a merger, amalgamation
or similar transaction so long as such merger, amalgamation or similar
transaction would be permitted by clause (a) of this Section 6.8 if the acquired
Person was, initially, a Subsidiary of Borrower);

(j) Liens incurred in compliance with Section 6.2;

(k) dispositions of investments in Joint Ventures, to the extent required by, or
made pursuant to buy/sell arrangements between the joint venture parties set
forth in joint venture arrangements and similar binding arrangements; provided
that the consideration received shall be in an amount at least equal to the fair
market value thereof (determined in good faith by the board of directors of
Borrower; provided that any Net Asset Sale Proceeds from any such disposition
shall be applied as required by Section 2.14(a);

(l) the disposition by Dow Pharmaceutical Sciences, Inc. of its Equity Interests
in Bioskin GmbH, a company with limited liability organized under the laws of
Germany; provided that any Net Asset Sale Proceeds from any such disposition
shall be applied as required by Section 2.14(a);

(m) Asset Sales in connection with any Acquisition, for regulatory reasons;
provided that any Net Asset Sale Proceeds therefrom shall be applied as required
by Section 2.14(a);

(n) the Acquisitions; and

(o) Asset Sales by Sanitas AB of real property; provided that any Net Asset Sale
Proceeds from any such disposition shall be applied as required by
Section 2.14(a);

For purposes of clause (c) of this Section 6.8, each of the following will be
deemed Cash:

(i) any liabilities, as shown on Borrower’s most recent consolidated balance
sheet, of Borrower or any of its Subsidiaries (other than contingent liabilities
and liabilities that are by their terms subordinated to the Loans) that are
assumed by the transferee of any such assets pursuant to an agreement that
releases Borrower or such Subsidiary from further liability;

(ii) any securities, notes or other obligations received by Borrower or any such
Subsidiary from such transferee that are converted by Borrower or such
Subsidiary into Cash within 180 days after the consummation of the applicable
Asset Sale, to the extent of the Cash received in that conversion; and

(iii) any Designated Noncash Consideration having an aggregate fair market value
that, when taken together with all other Designated Noncash Consideration
previously received and then outstanding, does not exceed at the time of the
receipt of such Designated Noncash Consideration

 

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(with the fair market value of each item of Designated Noncash Consideration
being measured at the time received and without giving effect to subsequent
changes in value) the greater of $100,000,000 or 1.00% of Consolidated Total
Assets.

6.9 Disposal of Subsidiary Interests. Except for any sale of all of its
interests in the Equity Interests of any of its Subsidiaries in compliance with
the provisions of Section 6.8, no Credit Party shall, nor shall it permit any of
its Subsidiaries to directly or indirectly sell, assign, pledge or otherwise
encumber or dispose of any Equity Interests of any of its Subsidiaries, except
to another Credit Party (subject to the restrictions on such disposition
otherwise imposed hereunder), or to qualify directors if required by Applicable
Law.

6.10 Sales and Leasebacks. No Credit Party shall, nor shall it permit any of its
Subsidiaries to, directly or indirectly, become or remain liable as lessee or as
a guarantor or other surety with respect to any lease of any property (whether
real, personal or mixed), whether now owned or hereafter acquired, which such
Credit Party (a) has sold or transferred or is to sell or to transfer to any
other Person (other than Borrower or any of its Subsidiaries), or (b) intends to
use for substantially the same purpose as any other property which has been or
is to be sold or transferred by such Credit Party to any Person (other than
Borrower or any of its Subsidiaries) in connection with such lease, except for
any such sale and subsequent lease of any fixed or capital assets by a Credit
Party or any of its Subsidiaries that is made for Cash consideration in an
amount not less than the fair value of such fixed or capital asset and is
consummated within 90 days after such Credit Party or such Subsidiary acquires
or completes the construction of such fixed or capital asset, provided that, if
such sale and leaseback results in Indebtedness with respect to Capital Leases,
such Indebtedness is permitted by Section 6.1(j) and any Lien made the subject
of such Indebtedness is permitted by Section 6.2(m).

6.11 Transactions with Shareholders and Affiliates. No Credit Party shall, nor
shall it permit any of its Subsidiaries to, directly or indirectly, enter into
or permit to exist any transaction (including the purchase, sale, lease or
exchange of any property or the rendering of any service) with any Affiliate of
Borrower on terms that are less favorable to Borrower or that Subsidiary, as the
case may be, than those that might be obtained at the time from a Person who is
not such an Affiliate; provided that the foregoing restriction shall not apply
to (a) any transaction between or among Borrower and the Guarantors;
(b) reasonable and customary fees paid to members of the board of directors (or
similar governing body) of Borrower or of its Subsidiaries; (c) compensation
arrangements (including severance arrangements to the extent approved by a
majority of the disinterested members of Borrower’s or the applicable
Subsidiary’s board of directors (or similar governing body) or the applicable
committee thereof) for present or former officers and other employees of
Borrower or of its Subsidiaries entered into in the ordinary course of business;
(d) transactions described in Schedule 6.11; (e) any Restricted Junior Payment
permitted pursuant to Section 6.4; (f) indemnities provided for the benefit of,
directors, officers or employees of Borrower or of its Subsidiaries in the
ordinary course of business; and (g) loans and advances to employees of Borrower
or of its Subsidiaries permitted by Section 6.6(f) (as well as advances to
employees contemplated by clause (iii) of the defined term “Investment”).

6.12 Conduct of Business. From and after the Third Restatement Date, no Credit
Party shall, nor shall it permit any of its Subsidiaries to, engage in any
business other than (i) the businesses engaged in by such Credit Party or
Subsidiary on the Third Restatement Date and similar or related or ancillary
businesses and (ii) such other lines of business as may be consented to by
Requisite Lenders.

6.13 Amendments or Waivers with Respect to Subordinated Indebtedness. No Credit
Party shall, nor shall it permit any of its Subsidiaries to, amend or otherwise
change the terms of any Subordinated Indebtedness, if such amendment or change
would be materially adverse to any Credit Party or Lenders.

 

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6.14 Amendments or Waivers of Organizational Documents. No Credit Party shall,
nor shall it permit any of its Subsidiaries to, agree to any amendment,
restatement, supplement or other modification to, or waiver of, any of its
Organizational Documents after the Third Restatement Date that is materially
adverse to such Credit Party or such Subsidiary, as applicable, and to the
Lenders.

6.15 Fiscal Year. No Credit Party shall, nor shall it permit any of its
Subsidiaries to, change its Fiscal Year end from December 31.

6.16 Specified Subsidiary Dispositions. Borrower will not, and will not permit
any Subsidiary to, sell, transfer, lease or otherwise dispose of the Equity
Interests it holds in Biovail Insurance.

6.17 Biovail Insurance. Borrower will not permit Biovail Insurance to (i) carry
on any business other than the business of an Exempt Insurance Company as
defined under the Exempt Insurance Act of Barbados for the purpose of insuring
Borrower and/or some or all of its Subsidiaries or (ii) cancel, terminate or
otherwise amend or modify the Biovail Insurance Trust Indenture.

6.18 Establishment of Defined Benefit Plan. No Credit Party shall (a) sponsor,
administer, maintain, contribute to, participate in or assume or incur any
liability in respect of, any Defined Benefit Plan, or (b) acquire an interest in
any Person if such Person sponsors, administers, maintains, contributes to,
participates in or has any liability in respect of, any Defined Benefit Plan,
other than, with respect to clauses (a) and (b), Defined Benefit Plans that do
not, in the aggregate, have a solvency deficit in excess of $10,000,000 at any
time.

SECTION 7. GUARANTY

7.1 Guaranty of the Obligations. Subject to the provisions of the Contribution
Agreement, Guarantors jointly and severally hereby irrevocably and
unconditionally guaranty to Administrative Agent for the ratable benefit of the
Beneficiaries the due and punctual payment in full of all Obligations when the
same shall become due, whether at stated maturity, by required prepayment,
declaration, acceleration, demand or otherwise (including amounts that would
become due but for the operation of the automatic stay under Section 362(a) of
the Bankruptcy Code, 11 U.S.C. § 362(a) or other Insolvency Laws) (collectively,
the “Guaranteed Obligations”).

7.2 Contribution by Guarantors. Each of the Guarantors shall be party to, and
subject to the terms of, the Contribution Agreement.

7.3 Payment by Guarantors. Subject to the Contribution Agreement, Guarantors
hereby jointly and severally agree, in furtherance of the foregoing and not in
limitation of any other right which any Beneficiary may have at law or in equity
against any Guarantor by virtue hereof, that upon the failure of Borrower to pay
any of the Guaranteed Obligations when and as the same shall become due, whether
at stated maturity, by required prepayment, declaration, acceleration, demand or
otherwise (including amounts that would become due but for the operation of the
automatic stay under Section 362(a) of the Bankruptcy Code, 11 U.S.C. § 362(a)
or analogous provisions of other Insolvency Laws), Guarantors will upon demand
pay, or cause to be paid, in Cash, to Administrative Agent for the ratable
benefit of Beneficiaries, an amount equal to the sum of the unpaid principal
amount of all Guaranteed Obligations then due as aforesaid, accrued and unpaid
interest on such Guaranteed Obligations (including interest which, but for
Borrower’s becoming the subject of a case or proceeding under any Insolvency
Law, would have accrued on such Guaranteed Obligations, whether or not a claim
is allowed against Borrower for such interest in the related bankruptcy case)
and all other Guaranteed Obligations then owed to Beneficiaries as aforesaid.

 

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7.4 Liability of Guarantors Absolute. To the extent permitted under Applicable
Law, each Guarantor agrees that its obligations hereunder are irrevocable,
absolute, independent and unconditional and shall not be affected by any
circumstance which constitutes a legal or equitable discharge of a guarantor or
surety other than satisfaction in full of the Guaranteed Obligations. In
furtherance of the foregoing and without limiting the generality thereof, each
Guarantor agrees as follows:

(a) this Guaranty is a guaranty of payment and performance when due and not of
collectability. This Guaranty is a primary obligation of each Guarantor and not
merely a contract of surety;

(b) to the extent permitted under Applicable Law, Administrative Agent may
enforce this Guaranty upon the occurrence of an Event of Default notwithstanding
the existence of any dispute between Borrower and any Beneficiary with respect
to the existence of such Event of Default;

(c) the obligations of each Guarantor hereunder are independent of the
obligations of Borrower and the obligations of any other guarantor (including
any other Guarantor) of the obligations of Borrower, and a separate action or
actions may be brought and prosecuted against such Guarantor whether or not any
action is brought against Borrower or any of such other guarantors and whether
or not Borrower is joined in any such action or actions;

(d) payment by any Guarantor of a portion, but not all, of the Guaranteed
Obligations shall in no way limit, affect, modify or abridge any Guarantor’s
liability for any portion of the Guaranteed Obligations which has not been paid.
Without limiting the generality of the foregoing, if Administrative Agent is
awarded a judgment in any suit brought to enforce any Guarantor’s covenant to
pay a portion of the Guaranteed Obligations, such judgment shall not be deemed
to release such Guarantor from its covenant to pay the portion of the Guaranteed
Obligations that is not the subject of such suit, and such judgment shall not,
except to the extent satisfied by such Guarantor, limit, affect, modify or
abridge any other Guarantor’s liability hereunder in respect of the Guaranteed
Obligations;

(e) any Beneficiary, upon such terms as it deems appropriate, without notice or
demand and without affecting the validity or enforceability hereof or giving
rise to any reduction, limitation, impairment, discharge or termination of any
Guarantor’s liability hereunder, from time to time may (i) renew, extend,
accelerate, increase the rate of interest on, or otherwise change the time,
place, manner or terms of payment of the Guaranteed Obligations; (ii) settle,
compromise, release or discharge, or accept or refuse any offer of performance
with respect to, or substitutions for, the Guaranteed Obligations or any
agreement relating thereto and/or subordinate the payment of the same to the
payment of any other obligations; (iii) request and accept other guaranties of
the Guaranteed Obligations and take and hold security for the payment hereof or
the Guaranteed Obligations; (iv) release, surrender, exchange, substitute,
compromise, settle, rescind, waive, alter, subordinate or modify, with or
without consideration, any security for payment of the Guaranteed Obligations,
any other guaranties of the Guaranteed Obligations, or any other obligation of
any Person (including any other Guarantor) with respect to the Guaranteed
Obligations; (v) enforce and apply any security now or hereafter held by or for
the benefit of such Beneficiary in respect hereof or the Guaranteed Obligations
and direct the order or manner of sale thereof, or exercise any other right or
remedy that such Beneficiary may have against any such security, in each case as
such Beneficiary in its discretion may determine consistent herewith or the
applicable Hedge Agreement or Cash Management Agreement and any applicable
security agreement, including foreclosure on any such security pursuant to one
or more judicial or nonjudicial sales, whether or not every aspect of any such
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action operates to impair or extinguish any right of reimbursement or
subrogation or other right or remedy of any Guarantor against Borrower or any
security for the Guaranteed Obligations; and (vi) exercise any other rights
available to it under the Credit Documents or any Hedge Agreements or any Cash
Management Agreements; and

(f) this Guaranty and the obligations of Guarantors hereunder shall be valid and
enforceable and shall not be subject to any reduction, limitation, impairment,
discharge or termination for any reason (other than payment in full of the
Guaranteed Obligations), including the occurrence of any of the following,
whether or not any Guarantor shall have had notice or knowledge of any of them:
(i) any failure or omission to assert or enforce or agreement or election not to
assert or enforce, or the stay or enjoining, by order of court, by operation of
law or otherwise, of the exercise or enforcement of, any claim or demand or any
right, power or remedy (whether arising under the Credit Documents or any Hedge
Agreements or any Cash Management Agreements, at law, in equity or otherwise)
with respect to the Guaranteed Obligations or any agreement relating thereto, or
with respect to any other guaranty of or security for the payment or performance
of the Guaranteed Obligations; (ii) any rescission, waiver, amendment or
modification of, or any consent to departure from, any of the terms or
provisions (including provisions relating to events of default) hereof, any of
the other Credit Documents, any of the Hedge Agreements, any of the Cash
Management Agreements or any agreement or instrument executed pursuant thereto,
or of any other guaranty or security for the Guaranteed Obligations, in each
case whether or not in accordance with the terms hereof or such Credit Document,
such Hedge Agreement, such Cash Management Agreement or any agreement relating
to such other guaranty or security; (iii) to the extent permitted by Applicable
Law, the Guaranteed Obligations, or any agreement relating thereto, at any time
being found to be illegal, invalid or unenforceable in any respect; (iv) the
application of payments received from any source (other than payments received
pursuant to the other Credit Documents, any of the Hedge Agreements, any of the
Cash Management Agreements or from the proceeds of any security for the
Guaranteed Obligations, except to the extent such security also serves as
collateral for indebtedness other than the Guaranteed Obligations) to the
payment of indebtedness other than the Guaranteed Obligations, even though any
Beneficiary might have elected to apply such payment to any part or all of the
Guaranteed Obligations; (v) any Beneficiary’s consent to the change,
reorganization or termination of the corporate structure or existence of
Borrower or any of its Subsidiaries and to any corresponding restructuring of
the Guaranteed Obligations; (vi) any failure to perfect or continue perfection
of a security interest in any collateral which secures any of the Guaranteed
Obligations; (vii) to the extent permitted by Applicable Law, any defenses,
set-offs or counterclaims which Borrower may allege or assert against any
Beneficiary in respect of the Guaranteed Obligations, including failure of
consideration, breach of warranty, payment, statute of frauds, statute of
limitations, accord and satisfaction and usury; and (viii) any other act or
thing or omission, or delay to do any other act or thing, which may or might in
any manner or to any extent vary the risk of any Guarantor as an obligor in
respect of the Guaranteed Obligations.

(g) Each of the Secured Parties agrees not to enforce the guarantee created
hereunder by, or any other Obligations under the Credit Document of a Guarantor
established in Luxembourg (a “Luxembourg Guarantor”) in so far as the aggregate
obligations and liabilities of any Luxembourg Guarantor with respect to the
repayment under a joint and several liability clause of any borrowing or costs
or expenses not incurred directly or indirectly by or on behalf of the
Luxembourg Guarantor, and the granting of any guarantee, indemnity or security
under the Credit Documents exceed 90% each time the higher of (i) the book value
of all the assets of the Luxembourg Guarantor at the time of this Agreement or
at the time the relevant guarantee or security is enforced or (ii) the net
assets (capitaux propres as referred to in article 34 of the Luxembourg law on
the commercial register and annual accounts) of such Luxembourg Guarantor as
shown in the

 

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financial statements as of the date of this Agreement or in the latest financial
statements (comptes annuels) available at the date of the relevant payment
hereunder and approved by the shareholders of such Luxembourg Company, and as
audited by its statutory auditor or its external auditor (réviseur
d’entreprise), if required by law; it being understood that the payment
obligations of the Luxembourg Guarantor shall not be limited to the extent that
the Luxembourg Guarantor secures obligations of its direct or indirect
Subsidiaries or in respect of sums that have been made directly or indirectly
available to the Luxembourg Guarantor. Notwithstanding anything to the contrary
in the Credit Documents, the limitation set out in this Section 7.4(g) shall
apply to the aggregate of all securities, whether guarantees, pledges, security
assignments, or otherwise, granted or to be granted by the Luxembourg Guarantor.

7.5 Waivers by Guarantors. To the extent permitted by Applicable Law, each
Guarantor hereby waives, for the benefit of Beneficiaries: (a) any right to
require any Beneficiary, as a condition of payment or performance by such
Guarantor, to (i) proceed against Borrower, any other guarantor (including any
other Guarantor) of the Guaranteed Obligations or any other Person, (ii) proceed
against or exhaust any security held from Borrower, any such other guarantor or
any other Person, (iii) proceed against or have resort to any balance of any
Deposit Account or credit on the books of any Beneficiary in favor of Borrower
or any other Person, or (iv) pursue any other remedy in the power of any
Beneficiary whatsoever; (b) any defense arising by reason of the incapacity,
lack of authority or any disability or other defense of Borrower or any other
Guarantor including any defense based on or arising out of the lack of validity
or the unenforceability of the Guaranteed Obligations or any agreement or
instrument relating thereto or by reason of the cessation of the liability of
Borrower or any other Guarantor from any cause other than satisfaction in full
of the Guaranteed Obligations; (c) any defense based upon any statute or rule of
law which provides that the obligation of a surety must be neither larger in
amount nor in other respects more burdensome than that of the principal; (d) any
defense based upon any Beneficiary’s errors or omissions in the administration
of the Guaranteed Obligations, except behavior which amounts to gross
negligence, willful misconduct or bad faith; (e) (i) any principles or
provisions of law, statutory or otherwise, which are or might be in conflict
with the terms hereof and any legal or equitable discharge of such Guarantor’s
obligations hereunder, (ii) the benefit of any statute of limitations affecting
such Guarantor’s liability hereunder or the enforcement hereof, (iii) any rights
to set-offs, recoupments and counterclaims, and (iv) promptness, diligence and
any requirement that any Beneficiary protect, secure, perfect or insure any
security interest or lien or any property subject thereto; (f) notices, demands,
presentments, protests, notices of protest, notices of dishonor and notices of
any action or inaction, including acceptance hereof, notices of default
hereunder, the Hedge Agreements, the Cash Management Agreements or any agreement
or instrument related thereto, notices of any renewal, extension or modification
of the Guaranteed Obligations or any agreement related thereto, notices of any
extension of credit to Borrower and notices of any of the matters referred to in
Section 7.4 and any right to consent to any thereof; and (g) any defenses or
benefits that may be derived from or afforded by law which limit the liability
of or exonerate guarantors or sureties, or which may conflict with the terms
hereof.

7.6 Guarantors’ Rights of Subrogation, Contribution, etc. Until the Guaranteed
Obligations shall have been indefeasibly paid in full and the Revolving
Commitments shall have terminated and all Letters of Credit shall have expired
or been cancelled, each Guarantor hereby waives, to the extent permitted by
Applicable Law, any claim, right or remedy, direct or indirect, that such
Guarantor now has or may hereafter have against Borrower or any other Guarantor
or any of its assets in connection with this Guaranty or the performance by such
Guarantor of its obligations hereunder, in each case whether such claim, right
or remedy arises in equity, under contract, by statute, under common law or
otherwise and including (a) any right of subrogation, reimbursement or
indemnification that such Guarantor now has or may hereafter have against
Borrower with respect to the Guaranteed Obligations, (b) any right to enforce,
or to participate in, any claim, right or remedy that any Beneficiary now has or
may hereafter have against Borrower, and (c) any benefit of, and any right to
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held by any Beneficiary. In addition, until the Guaranteed Obligations shall
have been indefeasibly paid in full and the Revolving Commitments shall have
terminated and all Letters of Credit shall have expired or been cancelled, each
Guarantor shall withhold exercise of any right of contribution such Guarantor
may have against any other guarantor (including any other Guarantor) of the
Guaranteed Obligations, including any such right of contribution as contemplated
by the Contribution Agreement. Each Guarantor further agrees that, to the extent
the waiver or agreement to withhold the exercise of its rights of subrogation,
reimbursement, indemnification and contribution as set forth herein is found by
a court of competent jurisdiction to be void or voidable for any reason, any
rights of subrogation, reimbursement or indemnification such Guarantor may have
against Borrower or against any collateral or security, and any rights of
contribution such Guarantor may have against any such other guarantor, shall be
junior and subordinate to any rights any Beneficiary may have against Borrower,
to all right, title and interest any Beneficiary may have in any such collateral
or security, and to any right any Beneficiary may have against such other
guarantor. If any amount shall be paid to any Guarantor on account of any such
subrogation, reimbursement, indemnification or contribution rights at any time
when all Guaranteed Obligations shall not have been finally and indefeasibly
paid in full, such amount shall be held in trust for Administrative Agent on
behalf of Beneficiaries and shall forthwith be paid over to Administrative Agent
for the benefit of Beneficiaries to be credited and applied against the
Guaranteed Obligations, whether matured or unmatured, in accordance with the
terms hereof.

7.7 Subordination of Other Obligations. Any Indebtedness of Borrower or any
Guarantor now or hereafter held by any Guarantor (the “Obligee Guarantor”) is
hereby subordinated in right of payment to the Guaranteed Obligations, and any
such Indebtedness collected or received by the Obligee Guarantor after an Event
of Default has occurred and is continuing shall be held in trust for
Administrative Agent on behalf of Beneficiaries and shall forthwith be paid over
to Administrative Agent for the benefit of Beneficiaries to be credited and
applied against the Guaranteed Obligations but without affecting, impairing or
limiting in any manner the liability of the Obligee Guarantor under any other
provision hereof.

7.8 Continuing Guaranty. This Guaranty is a continuing guaranty and shall remain
in effect until all of the Guaranteed Obligations shall have been paid in full
and the Revolving Commitments shall have terminated and all Letters of Credit
shall have expired or been cancelled. Each Guarantor hereby irrevocably waives
any right to revoke this Guaranty as to future transactions giving rise to any
Guaranteed Obligations.

7.9 Authority of Guarantors or Borrower. It is not necessary for any Beneficiary
to inquire into the capacity or powers of any Guarantor or Borrower or the
officers, directors or any agents acting or purporting to act on behalf of any
of them.

7.10 Financial Condition of Borrower. Any Credit Extension may be made to
Borrower or continued from time to time, and any Hedge Agreements or Cash
Management Agreements may be entered into from time to time, in each case
without notice to or authorization from any Guarantor regardless of the
financial or other condition of Borrower at the time of any such grant or
continuation or at the time such Hedge Agreement or Cash Management Agreement is
entered into, as the case may be. No Beneficiary shall have any obligation to
disclose or discuss with any Guarantor its assessment, or any Guarantor’s
assessment, of the financial condition of Borrower. Each Guarantor has adequate
means to obtain information from Borrower on a continuing basis concerning the
financial condition of Borrower and its ability to perform its obligations under
the Credit Documents and the Hedge Agreements and the Cash Management
Agreements, and each Guarantor assumes the responsibility for being and keeping
informed of the financial condition of Borrower and of all circumstances bearing
upon the risk of nonpayment of the Guaranteed Obligations. Each Guarantor hereby
waives and relinquishes any duty on the part of any Beneficiary to disclose any
matter, fact or thing relating to the business, operations or conditions of
Borrower now known or hereafter known by any Beneficiary.

 

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7.11 Bankruptcy, etc.

(a) So long as any Guaranteed Obligations remain outstanding, no Guarantor
shall, without the prior written consent of Administrative Agent acting pursuant
to the instructions of Requisite Lenders, commence or join with any other Person
in commencing any bankruptcy, reorganization or insolvency case, application or
proceeding of or against Borrower or any other Guarantor. The obligations of
Guarantors hereunder shall not be reduced, limited, impaired, discharged,
deferred, suspended or terminated by any case, application or proceeding,
voluntary or involuntary, involving the bankruptcy, insolvency, receivership,
reorganization, liquidation or arrangement of Borrower or any other Guarantor or
by any defense which Borrower or any other Guarantor may have by reason of the
order, decree or decision of any court or administrative body resulting from any
such proceeding.

(b) Each Guarantor acknowledges and agrees that any interest on any portion of
the Guaranteed Obligations which accrues after the commencement of any case,
application or proceeding referred to in clause (a) above (or, if interest on
any portion of the Guaranteed Obligations ceases to accrue by operation of law
by reason of the commencement of such case, application or proceeding, such
interest as would have accrued on such portion of the Guaranteed Obligations if
such case, application or proceeding had not been commenced) shall be included
in the Guaranteed Obligations because it is the intention of Guarantors and
Beneficiaries that the Guaranteed Obligations which are guaranteed by Guarantors
pursuant hereto should be determined without regard to any rule of law or order
which may relieve Borrower of any portion of such Guaranteed Obligations.
Guarantors will permit any trustee in bankruptcy, receiver, debtor in
possession, assignee for the benefit of creditors or similar Person to pay
Administrative Agent, or allow the claim of Administrative Agent in respect of,
any such interest accruing after the date on which such case, application or
proceeding is commenced.

(c) In the event that all or any portion of the Guaranteed Obligations are paid
by Borrower, the obligations of Guarantors hereunder shall continue and remain
in full force and effect or be reinstated, as the case may be, in the event that
all or any part of such payment(s) are rescinded or recovered directly or
indirectly from any Beneficiary as a preference, fraudulent transfer or
otherwise, and any such payments which are so rescinded or recovered shall
constitute Guaranteed Obligations for all purposes hereunder.

7.12 Discharge of Guaranty upon Sale of Guarantor. If all of the Equity
Interests of any Guarantor or any of its successors in interest hereunder shall
be sold or otherwise disposed of (including by merger, amalgamation or
consolidation) in accordance with the terms and conditions hereof, the Guaranty
of such Guarantor or such successor in interest, as the case may be, hereunder
shall automatically be discharged and released without any further action by any
Beneficiary or any other Person effective as of the time of such Asset Sale.

7.13 Swiss Guarantee Limitations. Notwithstanding anything to the contrary in
this Agreement or any other Credit Document, the following limitations shall
apply to any Swiss Guarantor:

(a) If complying with the obligations of the Swiss Guarantor under the guarantee
(including for the avoidance of doubt, any restrictions of the Swiss Guarantor’s
rights of set-off and/or subrogation or its duties to subordinate or waive
claims, if any) would constitute a repayment of capital (Einlagerückgewähr), a
violation of the legally protected reserves (gesetzlich geschützte Reserven) or
the payment of a (constructive) dividend (Gewinnausschüttung) by the Swiss
Guarantor or would otherwise be restricted under Swiss corporate law then
applicable (the

 

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“Restricted Obligations”), the aggregate liability of the Swiss Guarantor for
Restricted Obligations shall not exceed the amount of the Swiss Guarantor’s
freely disposable equity in accordance with Swiss law, being the total assets of
the relevant Swiss Guarantor less the total of (1) the aggregate of the relevant
Swiss Guarantor’s liabilities, (2) the aggregate share capital and (3) statutory
reserves (including reserves for own shares and revaluations as well as capital
surplus (agio) to the extent such reserves cannot be transferred into
unrestricted, distributable reserves (the “Maximum Amount”). The amount of
freely disposable equity shall be determined on the basis of an audited interim
balance sheet as set out in clause (b)(ii) below. This limitation shall only
apply to the extent that it is a requirement under applicable Swiss mandatory
law at the time the Swiss Guarantor is required to perform its guarantee
obligations under the Credit Documents. Such limitation shall not free the Swiss
Guarantor from its obligations in excess thereof, but merely postpone the
performance date therefor until such time as performance is again permitted
notwithstanding such limitation.

(b) Immediately after having been requested to make any payments or otherwise
perform Restricted Obligations under the guarantee, the Swiss Guarantor shall,
and any parent company of the Swiss Guarantor being a party to this Agreement
shall procure that, the Swiss Guarantor will:

(i) perform any Restricted Obligations which are not affected by the above
limitations and take and cause to be taken all and any action, including,
without limitation, (1) the passing of any shareholders’ resolutions to approve
any payment or other performance under this Agreement or any other Credit
Document and (2) the obtaining of any confirmations which may be required as a
matter of Swiss mandatory law in force at the time the Swiss Guarantor is
required to make a payment or perform other obligations under this Agreement or
any other Credit Document, in order to allow a prompt payment of amounts owed by
the Swiss Guarantor under this Agreement or any other Credit Document as well as
the performance by the Swiss Guarantor of other obligations there related with a
minimum of limitations; and

(ii) in respect of any balance, if and to the extent requested by the Collateral
Agent or required under then applicable Swiss law, provide the Collateral Agent
with an interim balance sheet audited by the statutory auditors of the Swiss
Guarantor setting out the Maximum Amount, take such further corporate and other
action as may be required by law (such as board and shareholders’ approvals and
the receipt of any confirmations from the Swiss Guarantor’s statutory auditors)
and other measures necessary to allow the Swiss Guarantor to make the payments
agreed hereunder with a minimum of limitations and, immediately thereafter, pay
up to the Maximum Amount to the Collateral Agent.

(c) If the enforcement of the obligations of the Swiss Guarantor under the
Credit Documents would be limited due to the effects referred to in this
Agreement, the Swiss Guarantor shall further, to the extent permitted by
applicable law and Swiss accounting standards and upon request by the Collateral
Agent, write up or sell any of its assets that are shown in its balance sheet
with a book value that is significantly lower than the market value of the
assets, in case of sale, however, only if such assets are not necessary for the
Swiss Guarantor’s business (nicht betriebsnotwendig) and such sale is permitted
under the Credit Documents.

(d) To the extent required by applicable law, including double tax treaties, in
force at the time, the Swiss Guarantor is required to make a payment under this
Agreement it shall:

(i) use its best efforts to ensure that such payments can be made without
deduction of Swiss Withholding Tax, or with deduction of Swiss Federal
Withholding Tax at a reduced rate, by discharging the liability to such tax by
notification pursuant to applicable law (including tax treaties) rather than
payment of the tax;

 

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(ii) deduct the Swiss Federal Withholding Tax at such rate (being 35% on the
date hereof) as in force from time to time if the notification procedure
pursuant to sub-paragraph (i) above does not apply; or shall deduct the Swiss
Federal Withholding Tax at the reduced rate resulting after discharge of part of
such tax by notification if the notification procedure pursuant to sub-paragraph
(i) applies for a part of the Swiss Federal Withholding Tax only; and shall pay
within the time allowed any such taxes deducted to the Swiss Federal Tax
Administration; and

(iii) notify and provide evidence to the Collateral Agent that the Swiss Federal
Withholding Tax has been paid to the Swiss Federal Tax Administration.

(e) To the extent such deduction is made, and to the extent the maximum amount
of freely disposable shareholder equity pursuant to this Agreement is not fully
utilized, the Swiss Guarantor shall be required to pay an additional amount so
that after making any required deduction of Swiss Federal Withholding Tax the
aggregate net amount paid to the Lenders is equal to the amount which would have
been paid if no deduction of Swiss Federal Withholding Tax had been required,
provided that the aggregate amount paid (and including amounts withheld) shall
in any event be limited to the maximum amount of freely disposable shareholder
equity pursuant to this Agreement.

(f) The Swiss Guarantor shall use its reasonable efforts to ensure that any
Person which is, as a result of a deduction of Swiss Federal Withholding Tax,
entitled to a full or partial refund of the Swiss Federal Withholding Tax, will,
as soon as possible after the deduction of the Swiss Federal Withholding Tax,

(i) request a refund of the Swiss Federal Withholding Tax under any applicable
law (including double tax treaties), and

(ii) pay to the Collateral Agent upon receipt any amount so refunded (and after
deduction of any tax) if so required under the guarantee or the Indenture and to
the extent legally permissible.

(g) Notwithstanding anything to the contrary in the Credit Documents, the
limitation set out in this Section 7.13 shall apply to the aggregate of all
securities, whether guarantees, pledges, security assignments, or otherwise,
granted or to be granted by the Swiss Guarantor.

SECTION 8. EVENTS OF DEFAULT

8.1 Events of Default. If any one or more of the following conditions or events
shall occur:

(a) Failure to Make Payments When Due. Failure by Borrower to pay (i) when due
any installment of principal of any Loan, whether at stated maturity, by
acceleration, by notice of voluntary prepayment, by mandatory prepayment or
otherwise; (ii) when due any amount payable to Issuing Bank in reimbursement of
any drawing under a Letter of Credit; or (iii) any interest on any Loan or any
fee or any other amount due hereunder within three days after the date due; or

 

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(b) Default in Other Agreements. (i) Failure of any Credit Party or any of their
respective Subsidiaries to pay when due any principal of or interest on or any
other amount, including any payment in settlement, payable in respect of one or
more items of Indebtedness (other than Indebtedness referred to in
Section 8.1(a)) in an individual principal amount (or Net Mark-to-Market
Exposure) of $70,000,000 or with an aggregate principal amount (or Net
Mark-to-Market Exposure) of $70,000,000 or more, in each case beyond the grace
period, if any, provided therefor; or (ii) breach or default by any Credit Party
with respect to any other material term of (1) one or more items of Indebtedness
in the individual or aggregate principal amounts (or Net Mark-to-Market
Exposure) referred to in clause (i) above or (2) any loan agreement, mortgage,
indenture or other agreement relating to such item(s) of Indebtedness, in each
case beyond the grace period, if any, provided therefor, if the effect of such
breach or default is to cause, or to permit the holder or holders of that
Indebtedness (or a trustee on behalf of such holder or holders), to cause, that
Indebtedness to become or be declared due and payable (or redeemable) prior to
its stated maturity or the stated maturity of any underlying obligation, as the
case may be; or

(c) Breach of Certain Covenants. Failure of any Credit Party to perform or
comply with any term or condition contained in Section 2.6, Section 5.1(e),
Section 5.2 or Section 6; or

(d) Breach of Representations, Etc. Any representation, warranty, certification
or other statement made or deemed made by any Credit Party in any Credit
Document or in any statement or certificate at any time given by any Credit
Party or any of its Subsidiaries in writing pursuant hereto or thereto or in
connection herewith or therewith shall be false in any material respect as of
the date made or deemed made; or

(e) Other Defaults Under Credit Documents. Any Credit Party shall default in the
performance of or compliance with any term contained herein or any of the other
Credit Documents, other than any such term referred to in any other Section of
this Section 8.1, and such default shall not have been remedied or waived within
thirty days after the earlier of (i) an officer of such Credit Party becoming
aware of such default or (ii) receipt by Borrower of notice from Administrative
Agent or any Lender of such default; or

(f) Involuntary Bankruptcy; Appointment of Receiver, etc. (i) A court of
competent jurisdiction shall enter a decree or order for relief in respect of
Borrower or any of its Subsidiaries (other than any Immaterial Subsidiaries) in
an involuntary case under any Insolvency Law, which decree or order is not
stayed; or any other similar relief shall be granted under any Applicable Law;
or (ii) an involuntary case or proceeding (including the filing of any notice of
intention in respect thereof) shall be commenced against Borrower or any of its
Subsidiaries (other than any Immaterial Subsidiaries) under any Insolvency Law
now or hereafter in effect; or a decree or order of a court having jurisdiction
in the premises for the appointment of a receiver, receiver-manager,
administrative receiver, administrator, liquidator, sequestrator, trustee,
custodian or other officer having similar powers over Borrower or any of its
Subsidiaries (other than any Immaterial Subsidiaries), or over all or a
substantial part of its property, shall have been entered; or there shall have
occurred the involuntary appointment of an interim receiver, trustee, custodian
or similar officer of Borrower or any of its Subsidiaries (other than any
Immaterial Subsidiaries) for all or a substantial part of its property; or a
warrant of attachment, execution or similar process shall have been issued
against any substantial part of the property of Borrower or any of its
Subsidiaries (other than any Immaterial Subsidiaries), and any such event
described in this clause (ii) shall continue for sixty days without having been
dismissed, bonded or discharged; or

(g) Voluntary Bankruptcy; Appointment of Receiver, etc. (i) Borrower or any of
its Subsidiaries (other than any Immaterial Subsidiaries) shall have an order
for relief entered with

 

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respect to it or shall file a petition or application seeking any relief or
shall otherwise commence a voluntary case or proceeding under any Insolvency
Law, or shall consent to, or fail to contest in a timely manner the commencement
of, or the entry of an order for relief in an involuntary case or proceeding, or
to the conversion of an involuntary case to a voluntary case or proceeding,
under any such law, or shall consent to, or fail to contest in a timely manner,
the commencement of, or the appointment of or taking possession by a receiver,
receiver-manager, trustee, custodian or other similar officer for all or a
substantial part of its property; or Borrower or any of its Subsidiaries (other
than any Immaterial Subsidiaries) shall make any assignment for the benefit of
creditors; or (ii) Borrower or any of its Subsidiaries (other than any
Immaterial Subsidiaries) shall be unable, or shall fail generally, or shall
admit in writing its inability, to pay its debts as such debts become due or is
otherwise insolvent; or the board of directors (or similar governing body) of
Borrower or any of its Subsidiaries (other than any Immaterial Subsidiaries) (or
any committee thereof) shall adopt any resolution or otherwise authorize any
action to approve any of the actions referred to herein or in Section 8.1(f); or

(h) Judgments and Attachments. Any money judgment, writ or warrant of attachment
or similar process involving an amount in excess of $70,000,000 individually or
in the aggregate at any time (in either case to the extent not adequately
covered by insurance as to which a solvent and unaffiliated insurance company
has acknowledged coverage) shall be entered or filed against Borrower, any of
its Subsidiaries or any of their respective assets and shall remain
undischarged, unvacated, unbonded or unstayed for a period of sixty days (or in
any event later than five days prior to the date of any proposed sale
thereunder); or

(i) Dissolution. Any order, judgment or decree shall be entered against any
Credit Party decreeing the dissolution, winding-up or split-up of such Credit
Party and such order shall remain undischarged or unstayed for a period in
excess of thirty days; or

(j) Employee Benefit Plans. There shall occur one or more ERISA Events that have
had or could reasonably be expected to have, individually or in the aggregate, a
Material Adverse Effect; or

(k) Canadian Employee Benefit Plans. (x) There shall occur one or more Canadian
Pension Plan Termination Events that have had or could reasonably be expected to
have, individually or in the aggregate, a Material Adverse Effect or (y) a
Canadian Credit Party fails to make a required contribution to or payment under
any Canadian Pension Plan when due and such failure has had or could reasonably
be expected to have, individually or in the aggregate, a Material Adverse
Effect; or

(l) Change of Control. A Change of Control shall occur; or

(m) Guaranties, Collateral Documents and Other Credit Documents. At any time
after the execution and delivery thereof, (i) the Guaranty for any reason, other
than the satisfaction in full of all Obligations, shall cease to be in full
force and effect (other than in accordance with its terms) or shall be declared
to be null and void or any Guarantor shall repudiate its obligations thereunder,
(ii) this Agreement or any Collateral Document ceases to be in full force and
effect (other than by reason of a release of Collateral in accordance with the
terms hereof or thereof or the satisfaction in full of the Obligations (other
than Obligations in respect of any Hedge Agreement or Cash Management Agreement)
in accordance with the terms hereof) or shall be declared null and void, or
Collateral Agent shall not have or shall cease to have a valid and perfected
Lien in any Collateral purported to be covered by the Collateral Documents with
the priority required by the relevant Collateral Document, in each case for any
reason other than the failure of Collateral

 

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Agent or any Secured Party to take any action within its control, or (iii) any
Credit Party shall contest the validity or enforceability of any Credit Document
in writing or deny in writing that it has any further liability, including with
respect to future advances by Lenders, under any Credit Document to which it is
a party or shall contest the validity or perfection of any Lien in any portion
of the Collateral purported to be covered by the Collateral Documents,

THEN, (1) upon the occurrence of any Event of Default described in
Section 8.1(f) or 8.1(g) with respect to Borrower, automatically, and (2) upon
the occurrence and during the continuance of any other Event of Default, at the
request of (or with the consent of) Requisite Lenders, upon notice to Borrower
by Administrative Agent, (A) the Revolving Commitments, if any, of each Lender
having such Revolving Commitments and the obligation of Issuing Bank to issue
any Letter of Credit shall immediately terminate; (B) each of the following
shall immediately become due and payable, in each case without presentment,
demand, protest or other requirements of any kind, all of which are hereby
expressly waived by each Credit Party: (I) the unpaid principal amount of and
accrued interest on the Loans, (II) an amount equal to the maximum amount that
may at any time be drawn under all Letters of Credit then outstanding
(regardless of whether any beneficiary under any such Letter of Credit shall
have presented, or shall be entitled at such time to present, the drafts or
other documents or certificates required to draw under such Letters of Credit),
to be held as security for Borrower’s reimbursement Obligations in respect of
Letters of Credit then outstanding and (III) all other Obligations (other than
Hedge Agreements and Cash Management Agreements unless and to the extent such
agreements are independently declared due and payable in accordance with their
respective terms); provided, the foregoing shall not affect in any way the
obligations of Lenders under Section 2.3(b)(v) or Section 2.4(e); and
(C) Administrative Agent may cause Collateral Agent to enforce any and all Liens
and security interests created pursuant to Collateral Documents.

SECTION 9. AGENTS

9.1 Appointment of Agents. J.P. Morgan and Morgan Stanley are hereby appointed
Co-Syndication Agents hereunder, and each Lender hereby authorizes J.P. Morgan
and Morgan Stanley to act as Co-Syndication Agents in accordance with the terms
hereof and the other Credit Documents. GSLP is hereby appointed Administrative
Agent and Collateral Agent hereunder and under the other Credit Documents and
each Lender hereby authorizes GSLP to act as Administrative Agent and Collateral
Agent in accordance with the terms hereof and of the other Credit Documents.
Each Agent hereby agrees to act in its capacity as such upon the express
conditions contained herein and the other Credit Documents, as applicable. The
provisions of this Section 9 are solely for the benefit of Agents and Lenders
and no Credit Party shall have any rights as a third party beneficiary of any of
the provisions thereof. In performing its functions and duties hereunder, each
Agent shall act solely as an agent of Lenders and does not assume and shall not
be deemed to have assumed any obligation towards or relationship of agency or
trust with or for Borrower or any of its Subsidiaries. Each Co-Syndication
Agent, without consent of or notice to any party hereto, may assign any and all
of its rights or obligations hereunder (in its capacity as a Co-Syndication
Agent) to any of its Affiliates. As of the Third Restatement Date, each of J.P.
Morgan and Morgan Stanley, in each of their capacities as a Co-Syndication
Agent, shall not have any obligations but shall be entitled to all benefits of
this Section 9. The Syndication Agents and any Agent described in clause (d) of
the definition thereof may resign from such role at any time, with immediate
effect, by giving prior written notice thereof to Administrative Agent and
Borrower.

9.2 Powers and Duties. Each Lender irrevocably authorizes each Agent to take
such action on such Lender’s behalf and to exercise such powers, rights and
remedies hereunder and under the other Credit Documents as are specifically
delegated or granted to such Agent by the terms hereof and thereof, together
with such powers, rights and remedies as are reasonably incidental thereto. Each
Agent shall have only those duties and responsibilities that are expressly
specified herein and the other Credit Documents. Each Agent may exercise such
powers, rights and remedies and perform such duties by or through

 

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its agents or employees. No Agent shall have, by reason hereof or any of the
other Credit Documents, a fiduciary relationship in respect of any Lender
(except, in respect of Collateral Agent in its capacity as trustee under
Section 9.8(a), to the extent such fiduciary relationship cannot lawfully be
excluded); and nothing herein or any of the other Credit Documents, expressed or
implied, is intended to or shall be so construed as to impose upon any Agent any
obligations in respect hereof or any of the other Credit Documents except as
expressly set forth herein or therein.

9.3 General Immunity.

(a) No Responsibility for Certain Matters. No Agent shall be responsible to any
Lender for the execution, effectiveness, genuineness, validity, enforceability,
collectability or sufficiency hereof or any other Credit Document or for any
representations, warranties, recitals or statements made herein or therein or
made in any written or oral statements or in any financial or other statements,
instruments, reports or certificates or any other documents furnished or made by
any Agent to Lenders or by or on behalf of any Credit Party or to any Agent or
any Lender in connection with the Credit Documents and the transactions
contemplated thereby or for the financial condition or business affairs of any
Credit Party or any other Person liable for the payment of any Obligations, nor
shall any Agent be required to ascertain or inquire as to the performance or
observance of any of the terms, conditions, provisions, covenants or agreements
contained in any of the Credit Documents or as to the use of the proceeds of the
Loans or as to the existence or possible existence of any Event of Default or
Default or to make any disclosures with respect to the foregoing. Anything
contained herein to the contrary notwithstanding, Administrative Agent shall not
have any liability arising from confirmations of the amount of outstanding Loans
or the Letter of Credit Usage or the component amounts thereof.

(b) Exculpatory Provisions. No Agent nor any of its officers, partners,
directors, employees or agents shall be liable to Lenders for any action taken
or omitted by any Agent under or in connection with any of the Credit Documents
except to the extent caused by such Agent’s gross negligence or willful
misconduct, as determined by a final, non-appealable judgment of a court of
competent jurisdiction. Each Agent shall be entitled to refrain from any act or
the taking of any action (including the failure to take an action) in connection
herewith or with any of the other Credit Documents or from the exercise of any
power, discretion or authority vested in it hereunder or thereunder unless and
until such Agent shall have received instructions in respect thereof from
Requisite Lenders (or such other Lenders as may be required to give such
instructions under Section 10.5) and, upon receipt of such instructions from
Requisite Lenders (or such other Lenders, as the case may be), such Agent shall
be entitled to act or (where so instructed) refrain from acting, or to exercise
such power, discretion or authority, in accordance with such instructions.
Without prejudice to the generality of the foregoing, (i) each Agent shall be
entitled to rely, and shall be fully protected in relying, upon any
communication, instrument or document believed by it to be genuine and correct
and to have been signed or sent by the proper Person or Persons and shall be
entitled to rely and shall be protected in relying on opinions and judgments of
attorneys (who may be attorneys for Borrower and its Subsidiaries), accountants,
experts and other professional advisors selected by it; and (ii) no Lender shall
have any right of action whatsoever against any Agent as a result of such Agent
acting or (where so instructed) refraining from acting hereunder or any of the
other Credit Documents in accordance with the instructions of Requisite Lenders
(or such other Lenders as may be required to give such instructions under
Section 10.5).

(c) Delegation of Duties. Administrative Agent may perform any and all of its
duties and exercise its rights and powers under this Agreement or under any
other Credit Document by or through any one or more sub-agents appointed by
Administrative Agent. Administrative 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 Affiliates. The exculpatory, indemnification and other provisions of
this Section 9.3 and of Section 9.6 shall apply to any of the Affiliates of
Administrative Agent and shall apply to their respective activities

 

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in connection with the syndication of the credit facilities provided for herein
as well as activities as Administrative Agent. All of the rights, benefits, and
privileges (including the exculpatory and indemnification provisions) of this
Section 9.3 and of Section 9.6 shall apply to any such sub-agent and to the
Affiliates of any such sub-agent, and shall apply to their respective activities
as sub-agent as if such sub-agent and Affiliates were named herein.
Notwithstanding anything herein to the contrary, with respect to each sub-agent
appointed by the Administrative Agent, (i) such sub-agent shall be a third party
beneficiary under this Agreement with respect to all such rights, benefits and
privileges (including exculpatory rights and rights to indemnification) and
shall have all of the rights and benefits of a third party beneficiary,
including an independent right of action to enforce such rights, benefits and
privileges (including exculpatory rights and rights to indemnification)
directly, without the consent or joinder of any other Person, against any or all
of Credit Parties and the Lenders, (ii) such rights, benefits and privileges
(including exculpatory rights and rights to indemnification) shall not be
modified or amended without the consent of such sub-agent, and (iii) such
sub-agent shall only have obligations to Administrative Agent and not to any
Credit Party, Lender or any other Person and no Credit Party, Lender or any
other Person shall have any rights, directly or indirectly, as a third party
beneficiary or otherwise, against such sub-agent; provided that the
Administrative Agent shall be responsible for the gross negligence, willful
misconduct or bad faith of such sub-agent.

9.4 Agents Entitled to Act as Lender. The agency hereby created shall in no way
impair or affect any of the rights and powers of, or impose any duties or
obligations upon, any Agent in its individual capacity as a Lender hereunder.
With respect to its participation in the Loans and the Letters of Credit, each
Agent shall have the same rights and powers hereunder as any other Lender and
may exercise the same as if it were not performing the duties and functions
delegated to it hereunder, and the term “Lender” shall, unless the context
clearly otherwise indicates, include each Agent in its individual capacity. Any
Agent and its Affiliates may accept deposits from, lend money to, own securities
of, and generally engage in any kind of banking, trust, financial advisory or
other business with Borrower or any of its Affiliates as if it were not
performing the duties specified herein, and may accept fees and other
consideration from Borrower for services in connection herewith and otherwise
without having to account for the same to Lenders.

9.5 Lenders’ Representations, Warranties and Acknowledgment.

(a) Each Lender represents and warrants that it has made its own independent
investigation of the financial condition and affairs of Borrower and its
respective Subsidiaries in connection with Credit Extensions hereunder and that
it has made and shall continue to make its own appraisal of the creditworthiness
of Borrower and its Subsidiaries. No Agent shall have any duty or
responsibility, either initially or on a continuing basis, to make any such
investigation or any such appraisal on behalf of Lenders or to provide any
Lender with any credit or other information with respect thereto, whether coming
into its possession before the making of the Loans or at any time or times
thereafter, and no Agent shall have any responsibility with respect to the
accuracy of or the completeness of any information provided to Lenders.

(b) Each Lender, by delivering its signature page to this Agreement, or an
Assignment Agreement or a Joinder Agreement and funding its Tranche A Term
Loans, Tranche B Term Loans, New Term Loans and/or Revolving Loans shall be
deemed to have acknowledged receipt of, and consented to and approved, each
Credit Document and each other document required to be approved by any Agent,
Requisite Lenders or Lenders, as applicable on the Original Closing Date, on the
First Restatement Date, on the Second Restatement Date, on the Second Amendment
and Restatement Joinder Date, on the Third Restatement Date or as of the date of
funding of such New Term Loans and/or Revolving Loans.

9.6 Right to Indemnity. Each Lender, in proportion to its Pro Rata Share,
severally agrees to indemnify each (a) Agent, their Affiliates and their
respective officers, partners, directors, trustees, employees

 

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and agents of each Agent and (b) Issuing Bank, their Affiliates and their
respective officers, partners, directors, trustees, employees and agents of
Issuing Bank (each, an “Indemnitee Agent Party”), to the extent that such
Indemnitee Agent Party shall not have been reimbursed by any Credit Party, for
and against any and all liabilities, obligations, losses, damages, penalties,
actions, judgments, suits, costs, expenses (including counsel fees and
disbursements) or disbursements of any kind or nature whatsoever which may be
imposed on, incurred by or asserted against such Indemnitee Agent Party in
exercising its powers, rights and remedies or performing its duties hereunder or
under the other Credit Documents or otherwise in its capacity as such Agent or
Issuing Bank in any way relating to or arising out of this Agreement or the
other Credit Documents, in all cases, whether or not caused by or arising, in
whole or in part, out of the negligence of such Indemnitee Agent Party; provided
that no Lender shall be liable for any portion of such liabilities, obligations,
losses, damages, penalties, actions, judgments, suits, costs, expenses or
disbursements resulting from such Indemnitee Agent Party’s gross negligence or
willful misconduct as determined by a final, non-appealable judgment of a court
of competent jurisdiction. If any indemnity furnished to any Indemnitee Agent
Party for any purpose shall, in the opinion of such Indemnitee Agent Party, be
insufficient or become impaired, such Indemnitee Agent Party may call for
additional indemnity and cease, or not commence, to do the acts indemnified
against until such additional indemnity is furnished; provided that in no event
shall this sentence require any Lender to indemnify any Indemnitee Agent Party
against any liability, obligation, loss, damage, penalty, action, judgment,
suit, cost, expense or disbursement in excess of such Lender’s Pro Rata Share
thereof; and provided further that this sentence shall not be deemed to require
any Lender to indemnify any Indemnitee Agent Party against any liability,
obligation, loss, damage, penalty, action, judgment, suit, cost, expense or
disbursement described in the proviso in the immediately preceding sentence.

9.7 Successor Administrative Agent, Collateral Agent and Swing Line Lender.

(a) Administrative Agent shall have the right to resign at any time by giving
prior written notice thereof to Lenders and Borrower, and Administrative Agent
may be removed at any time with or without cause by an instrument or concurrent
instruments in writing delivered to Borrower and Administrative Agent and signed
by Requisite Lenders. Administrative Agent shall have the right to appoint a
financial institution to act as Administrative Agent and/or Collateral Agent
hereunder, subject to the reasonable satisfaction of Borrower (other than at any
time an Event of Default shall have occurred and then be continuing) and the
Requisite Lenders, and Administrative Agent’s resignation shall become effective
on the earliest of (i) 30 days after delivery of the notice of resignation,
(ii) the acceptance of such successor Administrative Agent by Borrower (other
than at any time an Event of Default shall have occurred and then be continuing)
and the Requisite Lenders or (iii) such other date, if any, agreed to by the
Requisite Lenders. Upon any such notice of resignation or any such removal, if a
successor Administrative Agent has not already been appointed by the retiring
Administrative Agent, Requisite Lenders shall have the right, upon five Business
Days’ notice to Borrower, to appoint a successor Administrative Agent. If
neither Requisite Lenders nor Administrative Agent have appointed a successor
Administrative Agent, Requisite Lenders shall be deemed to have succeeded to and
become vested with all the rights, powers, privileges and duties of the retiring
Administrative Agent; provided that, until a successor Administrative Agent is
so appointed by Requisite Lenders or Administrative Agent, any collateral
security held by Administrative Agent in its role as Collateral Agent on behalf
of the Lenders or the Issuing Bank under any of the Credit Documents shall
continue to be held by the retiring Collateral Agent as nominee until such time
as a successor Collateral Agent is appointed. Upon the acceptance of any
appointment as Administrative Agent hereunder by a successor Administrative
Agent, that successor Administrative Agent shall thereupon succeed to and become
vested with all the rights, powers, privileges and duties of the retiring or
removed Administrative Agent and the retiring or removed Administrative Agent
shall promptly (i) transfer to such successor Administrative Agent all sums,
Securities and other items of Collateral held under the Collateral Documents,
together with all records and other documents necessary or appropriate in
connection with the performance of the duties of the successor Administrative
Agent under the Credit

 

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Documents, and (ii) execute and deliver to such successor Administrative Agent
such amendments to financing statements, and take such other actions, as may be
necessary or appropriate in connection with the assignment to such successor
Administrative Agent of the security interests created under the Collateral
Documents, whereupon such retiring or removed Administrative Agent shall be
discharged from its duties and obligations hereunder. Except as provided above,
any resignation or removal of GSLP or its successor as Administrative Agent
pursuant to this Section shall also constitute the resignation or removal of
GSLP or its successor as Collateral Agent. After any retiring or removed
Administrative Agent’s resignation or removal hereunder as Administrative Agent,
the provisions of this Section 9 shall inure to its benefit as to any actions
taken or omitted to be taken by it while it was Administrative Agent hereunder.
Any successor Administrative Agent appointed pursuant to this Section shall,
upon its acceptance of such appointment, become the successor Collateral Agent
for all purposes hereunder.

(b) In addition to the foregoing, Collateral Agent may resign at any time by
giving prior written notice thereof to Lenders and the Grantors, and Collateral
Agent may be removed at any time with or without cause by an instrument or
concurrent instruments in writing delivered to the Grantors and Collateral Agent
signed by Requisite Lenders. Administrative Agent shall have the right to
appoint a financial institution as Collateral Agent hereunder, subject to the
reasonable satisfaction of Borrower (other than at any time an Event of Default
shall have occurred and then be continuing) and the Requisite Lenders and
Collateral Agent’s resignation shall become effective on the earliest of (i) 30
days after delivery of the notice of resignation, (ii) the acceptance of such
successor Collateral Agent by Borrower (other than at any time an Event of
Default shall have occurred and then be continuing) and the Requisite Lenders or
(iii) such other date, if any, agreed to by the Requisite Lenders. Upon any such
notice of resignation or any such removal, Requisite Lenders shall have the
right, upon five Business Days’ notice to Administrative Agent, to appoint a
successor Collateral Agent. Until a successor Collateral Agent is so appointed
by Requisite Lenders or Administrative Agent, any collateral security held by
Collateral Agent on behalf of the Lenders or the Issuing Bank under any of the
Credit Documents shall continue to be held by the retiring Collateral Agent as
nominee until such time as a successor Collateral Agent is appointed. Upon the
acceptance of any appointment as Collateral Agent hereunder by a successor
Collateral Agent, that successor Collateral Agent shall thereupon succeed to and
become vested with all the rights, powers, privileges and duties of the retiring
or removed Collateral Agent under this Agreement and the Collateral Documents,
and the retiring or removed Collateral Agent under this Agreement shall promptly
(i) transfer to such successor Collateral Agent all sums, Securities and other
items of Collateral held hereunder or under the Collateral Documents, together
with all records and other documents necessary or appropriate in connection with
the performance of the duties of the successor Collateral Agent under this
Agreement and the Collateral Documents, and (ii) execute and deliver to such
successor Collateral Agent or otherwise authorize the filing of such amendments
to financing statements, and take such other actions, as may be necessary or
appropriate in connection with the assignment to such successor Collateral Agent
of the security interests created under the Collateral Documents, whereupon such
retiring or removed Collateral Agent shall be discharged from its duties and
obligations under this Agreement and the Collateral Documents. After any
retiring or removed Collateral Agent’s resignation or removal hereunder as the
Collateral Agent, the provisions of this Agreement and the Collateral Documents
shall inure to its benefit as to any actions taken or omitted to be taken by it
under this Agreement or the Collateral Documents while it was the Collateral
Agent hereunder.

(c) Any resignation or removal of GSLP or its successor as Administrative Agent
pursuant to this Section shall also constitute the resignation or removal of
GSLP or its successor as Swing Line Lender, and any successor Administrative
Agent appointed pursuant to this Section shall, upon its acceptance of such
appointment, become the successor Swing Line Lender for all purposes hereunder.
In such event (i) Borrower shall prepay any outstanding Swing Line Loans made by
the retiring or removed Administrative Agent in its capacity as Swing Line
Lender, (ii) upon such prepayment, the retiring or removed Administrative Agent
and Swing Line Lender shall surrender any Swing Line Note held by it to Borrower

 

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for cancellation, and (iii) Borrower shall issue, if so requested by successor
Administrative Agent and Swing Line Loan Lender, a new Swing Line Note to the
successor Administrative Agent and Swing Line Lender, in the principal amount of
the Swing Line Sublimit then in effect and with other appropriate insertions.

9.8 Collateral Documents and Guaranty.

(a) Agents Under Collateral Documents and Guaranty. Each Secured Party hereby
further authorizes Administrative Agent or Collateral Agent, as applicable, on
behalf of and for the benefit of Secured Parties, to be the agent for and
representative of Secured Parties with respect to the Guaranty, the Collateral
and the Collateral Documents; provided that neither Administrative Agent nor
Collateral Agent shall owe any fiduciary duty, duty of loyalty, duty of care,
duty of disclosure or any other obligation whatsoever to any holder of
Obligations with respect to any Hedge Agreement. Subject to Section 10.5,
without further written consent or authorization from any Secured Party,
Administrative Agent or Collateral Agent, as applicable may execute any
documents or instruments necessary to (i) in connection with a sale or
disposition of assets permitted by this Agreement, release any Lien encumbering
any item of Collateral that is the subject of such sale or other disposition of
assets or to which Requisite Lenders (or such other Lenders as may be required
to give such consent under Section 10.5) have otherwise consented or
(ii) release any Guarantor from the Guaranty pursuant to Section 7.12 or with
respect to which Requisite Lenders (or such other Lenders as may be required to
give such consent under Section 10.5) have otherwise consented. Collateral Agent
further declares that it holds all Australian Collateral acquired by the
Collateral Agent after the date hereof on trust for the benefit of the Secured
Parties from time to time (it being understood that the provisions of this
Section 9 apply to Collateral Agent in its capacity as trustee of such trust).

(b) Right to Realize on Collateral and Enforce Guaranty. Anything contained in
any of the Credit Documents to the contrary notwithstanding, Borrower,
Administrative Agent, Collateral Agent and each Secured Party hereby agree that
(i) no Secured Party shall have any right individually to realize upon any of
the Collateral or to enforce the Guaranty, it being understood and agreed that
all powers, rights and remedies hereunder may be exercised solely by
Administrative Agent, on behalf of the Secured Parties in accordance with the
terms hereof and all powers, rights and remedies under the Collateral Documents
may be exercised solely by Collateral Agent, and (ii) in the event of a
foreclosure by Collateral Agent on any of the Collateral pursuant to a public or
private sale or other disposition, Collateral Agent or any Lender may be the
purchaser or licensor of any or all of such Collateral at any such sale or other
disposition and Collateral Agent, as agent for and representative of Secured
Parties (but not any Lender or Lenders in its or their respective individual
capacities unless Requisite Lenders shall otherwise agree in writing) shall be
entitled, for the purpose of bidding and making settlement or payment of the
purchase price for all or any portion of the Collateral sold at any such public
sale, to use and apply any of the Obligations as a credit on account of the
purchase price for any collateral payable by Collateral Agent at such sale or
other disposition.

(c) Rights Under Hedge Agreements and Cash Management Agreements. No Hedge
Agreement or Cash Management Agreement will create (or be deemed to create) in
favor of any Lender Counterparty that is a party thereto any rights in
connection with the management or release of any Collateral or of the
obligations of any Guarantor under the Credit Documents except as expressly
provided in Section 10.5(c)(v) of this Agreement, Section 9.2 of the Second
Amended and Restated Pledge and Security Agreement and the analogous sections of
any other Collateral Documents. By accepting the benefits of the Collateral,
such Lender Counterparty shall be deemed to have appointed Collateral Agent as
its agent and agreed to be bound by the Credit Documents as a Secured Party,
subject to the limitations set forth in this clause (c).

 

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(d) Release of Collateral and Guarantees, Termination of Credit Documents.
Notwithstanding anything to the contrary contained herein or any other Credit
Document, when all Obligations (other than obligations in respect of any Hedge
Agreement or Cash Management Agreement) have been paid in full, all Commitments
have terminated or expired and no Letter of Credit shall be outstanding (unless
the outstanding amounts under all such Letters of Credit have been cash
collateralized in a manner reasonably satisfactory to Issuing Bank or, if
satisfactory to Issuing Bank in its sole discretion, a backstop Letter of Credit
is in place), upon request of Borrower, (i) Collateral Agent shall (without
notice to, or vote or consent of, any Lender, or any Affiliate of any Lender or
any Lender Counterparty that is a party to any Hedge Agreement or Cash
Management Agreement) take such actions as shall be required to release its
security interest in all Collateral, and (ii) Administrative Agent shall
(without notice to, or vote or consent of, any Lender, or any Affiliate of any
Lender or any Lender Counterparty that is a party to any Hedge Agreement or Cash
Management Agreement) take such actions as shall be required to release all
guarantee obligations provided for in any Credit Document, whether or not on the
date of such release there may be outstanding Obligations in respect of Hedge
Agreements or Cash Management Agreements (and, subject to the next succeeding
sentence, the provisions of Section 7 shall cease to apply). Any such release of
guarantee obligations shall be deemed subject to the provision that such
guarantee obligations shall be reinstated if after such release any portion of
any payment in respect of the Obligations guaranteed thereby shall be rescinded
or must otherwise be restored or returned upon the insolvency, bankruptcy,
dissolution, liquidation or reorganization of Borrower or any Guarantor, or upon
or as a result of the appointment of a receiver, intervenor or conservator of,
or trustee or similar officer for, Borrower or any Guarantor or any substantial
part of its property, or otherwise, all as though such payment had not been
made. In addition, upon (a) any disposition of property permitted by this
Agreement to a Person that is not a Credit Party, the Liens granted thereon
shall be deemed to be automatically released and such property shall
automatically revert to the applicable Grantor with no further action on the
part of any Person and (b) the consummation of any transaction permitted by the
Credit Agreement as a result of which a Guarantor ceases to be a Subsidiary of
Borrower, such Guarantor shall automatically be released from its obligations
hereunder and under the Collateral Documents and the guaranty and security
interest in the Collateral of such Guarantor shall automatically be released.

9.9 Withholding Taxes. To the extent required by any Applicable Law,
Administrative Agent may withhold from any payment to any Lender (which term
shall include Swing Line Lender and Issuing Bank for purposes of this
Section 9.9) an amount equivalent to any applicable withholding tax. If the
Internal Revenue Service or any other Governmental Authority asserts a claim
that Administrative Agent did not properly withhold Tax from amounts paid to or
for the account of any Lender because the appropriate form was not delivered or
was not properly executed or because such Lender failed to notify Administrative
Agent of a change in circumstance which rendered the exemption from, or
reduction of, withholding tax ineffective or for any other reason, such Lender
shall indemnify fully and hold harmless Administrative Agent (to the extent that
the Administrative Agent has not already been reimbursed by Borrower pursuant to
Section 2.20 and without limiting or expanding the obligation of Borrower to do
so) for all amounts paid, directly or indirectly, by the Administrative Agent as
Taxes or otherwise, together with all expenses incurred, including legal
expenses and any other out-of-pocket expenses, whether or not such Tax was
correctly or legally imposed or asserted by the relevant governmental authority.
A certificate as to the amount of such payment or liability delivered to any
Lender by the Administrative Agent shall be conclusive absent manifest error.
The agreements in this Section 9.9 shall survive the resignation and/or
replacement of the Administrative Agent, any assignment of rights by, or the
replacement of, a Lender, the termination of the Agreement and the repayment,
satisfaction or discharge of all other Obligations.

9.10 Quebec Security. To the extent that any Canadian Credit Party now or in the
future is required to grant security pursuant to the laws of the Province of
Quebec, each Agent (other than the Collateral Agent) and Lender acting for
itself and on behalf of all present and future Affiliates of such Agent

 

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or Lender that are or become a Lender Counterparty, hereby irrevocably
authorizes and appoints the Collateral Agent to act as the holder of an
irrevocable power of attorney (fondé de pouvoir) (within the meaning of Article
2692 of the Civil Code of Quebec) in order to hold any hypothec granted under
the laws of the Province of Quebec as security for any debenture, bond or other
title of indebtedness that may be issued by any Canadian Credit Party and to
exercise such rights and duties as are conferred upon a fondé de pouvoir under
the relevant deed of hypothec and applicable laws (with the power to delegate
any such rights or duties). Moreover, in respect of any pledge by any such
Canadian Credit Party of any such debenture, bond or other title of indebtedness
as security in respect of any Obligations, the Collateral Agent shall also be
authorized to hold such debenture, bond or other title of indebtedness as agent,
mandatary, custodian and pledgee for the benefit of the Agents, the Lenders and
the Lender Counterparties, the whole notwithstanding the provisions of
Section 32 of the An Act respecting the Special Powers of Legal Persons
(Quebec). The execution prior to the date hereof by the Collateral Agent of any
deed of hypothec or other security documents made pursuant to the laws of the
Province of Quebec, is hereby ratified and confirmed. Any person who becomes a
Lender, Issuing Bank, an Agent or a Lender Counterparty shall be deemed to have
consented to and ratified the foregoing appointment of each of the Collateral
Agent as fondé de pouvoir, agent, mandatary and custodian on behalf of all
Agents, Issuing Banks, Lenders and the Lender Counterparties, including such
person. For greater certainty, the Collateral Agent, when acting as the holder
of an irrevocable power of attorney (fondé de pouvoir), shall have the same
rights, powers, immunities, indemnities and exclusions from liability as are
prescribed in favour of the Collateral Agent in this Agreement, which shall
apply mutatis mutandis. In the event of the resignation and appointment of a
successor Collateral Agent, such successor of the Collateral Agent shall also
act as the holder of an irrevocable power of attorney (fondé de pouvoir), and as
agent, mandatary and custodian for the purposes set forth above. Without
limiting the foregoing, none of such Lenders shall have or be deemed to have a
fiduciary relationship with any Lender. The Lenders are not partners or
co-venturers, and no Lender shall be liable for the acts or omissions of, or
(except as otherwise set forth herein in case of the Administrative Agent)
authorized to act for, any other Lender.

SECTION 10. MISCELLANEOUS

10.1 Notices.

(a) Notices Generally. Any notice or other communication herein required or
permitted to be given to a Credit Party, Co-Syndication Agent, Collateral Agent,
Administrative Agent or Swing Line Lender, shall be sent to such Person’s
address as set forth on Appendix B or in the other relevant Credit Document, and
in the case of Issuing Bank or Lender, the address as indicated on Appendix B or
otherwise indicated to Administrative Agent in writing. Except as otherwise set
forth in Section 3.3(b) or paragraph (b) below, each notice hereunder shall be
in writing and may be personally served or sent by telefacsimile (except for any
notices sent to Administrative Agent) or United States mail or Canada Post or
courier service and shall be deemed to have been given when delivered in person
or by courier service and signed for against receipt thereof, upon receipt of
telefacsimile, or three Business Days after depositing it in the United States
mail or Canada Post with postage prepaid and properly addressed; provided that
no notice to any Agent shall be effective until received by such Agent; provided
further that any such notice or other communication shall at the request of the
Administrative Agent be provided to any sub-agent appointed pursuant to
Section 9.3(c) hereto as designated by the Administrative Agent from time to
time.

(b) Electronic Communications. (1) Notices and other communications to Lenders
and the Issuing Bank hereunder may be delivered or furnished by electronic
communication (including e mail and Internet or intranet websites, including the
Platform) pursuant to procedures approved by Administrative Agent, provided that
the foregoing shall not apply to notices to any Lender or the Issuing Bank
pursuant to Section 2 if such Lender or Issuing Bank, as applicable, has
notified Administrative Agent that it is incapable of receiving notices under
such Section by electronic communication. Administrative Agent or

 

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Borrower may, in its discretion, agree to accept notices and other
communications to it hereunder by electronic communications pursuant to
procedures approved by it, provided that approval of such procedures may be
limited to particular notices or communications. Unless Administrative Agent
otherwise prescribes, (i) notices and other communications sent to an e-mail
address shall be deemed received upon the sender’s receipt of an acknowledgement
from the intended recipient (such as by the “return receipt requested” function,
as available, return e-mail or other written acknowledgement), provided that if
such notice or other communication is not sent during the normal business hours
of the recipient, such notice or communication shall be deemed to have been sent
at the opening of business on the next Business Day for the recipient, and
(ii) notices or communications posted to an Internet or intranet website shall
be deemed received upon the deemed receipt by the intended recipient at its
e-mail address as described in the foregoing clause (i) of notification that
such notice or communication is available and identifying the website address
therefor.

(2) Each Credit Party understands that the distribution of material through an
electronic medium is not necessarily secure and that there are confidentiality
and other risks associated with such distribution and agrees and assumes the
risks associated with such electronic distribution, except to the extent caused
by the willful misconduct or gross negligence of Administrative Agent, as
determined by a final, non-appealable judgment of a court of competent
jurisdiction.

(3) The Platform and any Approved Electronic Communications are provided “as is”
and “as available.” None of the Agents nor any of their respective officers,
directors, employees, agents, advisors or representatives (the “Agent
Affiliates”) warrant the accuracy, adequacy, or completeness of the Approved
Electronic Communications or the Platform and each expressly disclaims liability
for errors or omissions in the Platform and the Approved Electronic
Communications. No warranty of any kind, express, implied or statutory,
including any warranty of merchantability, fitness for a particular purpose,
non-infringement of third party rights or freedom from viruses or other code
defects is made by the Agent Affiliates in connection with the Platform or the
Approved Electronic Communications.

(4) Each Credit Party, each Lender, Issuing Bank and each Agent agrees that
Administrative Agent may, but shall not be obligated to, store any Approved
Electronic Communications on the Platform in accordance with Administrative
Agent’s customary document retention procedures and policies.

(5) Any notice of Default or Event of Default may be provided by telephone if
confirmed promptly thereafter by delivery of written notice thereof.

(c) Private Side Information Contacts. Each Public Lender agrees to cause at
least one individual at or on behalf of such Public Lender to at all times have
selected the “Private Side Information” or similar designation on the content
declaration screen of the Platform in order to enable such Public Lender or its
delegate, in accordance with such Public Lender’s compliance procedures and
Applicable Law, including United States federal and state securities laws, to
make reference to information that is not made available through the “Public
Side Information” portion of the Platform and that may contain Non-Public
Information with respect to Borrower, its Subsidiaries or their securities for
purposes of Applicable Law, including United States federal or state securities
laws.

10.2 Expenses. Whether or not the transactions contemplated hereby shall be
consummated, Borrower agrees to pay promptly (a) all the actual and reasonable
out-of-pocket costs and expenses incurred in connection with the negotiation,
preparation and execution of the Credit Documents and any consents, amendments,
waivers or other modifications thereto; (b) all the reasonable out-of-pocket
costs of furnishing all opinions by counsel for Borrower and the other Credit
Parties; (c) the reasonable and documented out-of-pocket fees, expenses and
disbursements of counsel to Agents and Issuing Bank in connection with the
negotiation, preparation, execution and administration of the Credit Documents
and

 

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any consents, amendments, waivers or other modifications thereto and any other
documents or matters requested by Borrower; (d) all the actual costs and
reasonable out-of-pocket expenses of creating, perfecting, recording,
maintaining and preserving Liens in favor of Collateral Agent, for the benefit
of Secured Parties, including filing and recording fees, expenses and taxes,
stamp or documentary taxes, search fees, title insurance premiums and reasonable
fees, expenses and disbursements of counsel to each Agent and of counsel
providing any opinions that any Agent or Requisite Lenders may request in
respect of the Collateral or the Liens created pursuant to the Collateral
Documents; (e) all the actual costs and reasonable out-of-pocket fees, expenses
and disbursements of any auditors, accountants, consultants or appraisers;
(f) all the actual costs and reasonable out-of-pocket expenses (including the
reasonable fees, expenses and disbursements of any appraisers, consultants,
advisors and agents employed or retained by Collateral Agent and its counsel) in
connection with the custody or preservation of any of the Collateral; (g) all
other actual and reasonable out-of-pocket costs and expenses incurred by each
Agent or Issuing Bank in connection with the syndication of the Loans, including
for purposes of this Section 10.2, Letters of Credit and Commitments and the
transactions contemplated by the Credit Documents and any consents, amendments,
waivers or other modifications thereto; and (h) after the occurrence of a
Default or an Event of Default, all out-of-pocket costs and expenses, including
reasonable attorneys’ fees and costs of settlement, incurred by any Agent,
Issuing Bank and Lender in enforcing any Obligations of or in collecting any
payments due from any Credit Party hereunder or under the other Credit Documents
by reason of such Default or Event of Default (including in connection with the
sale, lease or license of, collection from, or other realization upon any of the
Collateral or the enforcement of the Guaranty) or in connection with any
refinancing or restructuring of the credit arrangements provided hereunder in
the nature of a “work-out” or pursuant to any insolvency or bankruptcy cases or
proceedings.

10.3 Indemnity.

(a) In addition to the payment of expenses pursuant to Section 10.2, whether or
not the transactions contemplated hereby shall be consummated, each Credit Party
agrees to defend indemnify, pay and hold harmless each Agent, Issuing Bank and
Lender and the officers, partners, members, directors, trustees, advisors,
employees, agents, sub-agents and Affiliates of each Agent, Issuing Bank and
each Lender (each, an “Indemnitee”), from and against any and all Indemnified
Liabilities, in all cases, whether or not caused by or arising, in whole or in
part, out of the negligence of such Indemnitee; provided that no Credit Party
shall have any obligation to any Indemnitee hereunder with respect to any
Indemnified Liabilities to the extent such Indemnified Liabilities arise from
the gross negligence or willful misconduct of that Indemnitee, in each case as
determined by a final, non-appealable judgment of a court of competent
jurisdiction, or if such Indemnified Liabilities result from any action, suit or
proceeding in contract brought by a Credit Party for direct damages (as opposed
to special, indirect, consequential or punitive damages) against such Indemnitee
for a material breach by such Indemnitee of its obligations under any Credit
Document that is determined in favor of such Credit Party by a final,
non-appealable judgment of a court of competent jurisdiction. To the extent that
the undertakings to defend, indemnify, pay and hold harmless set forth in this
Section 10.3 apply but are unenforceable in whole or in part because they are
violative of any law or public policy, the applicable Credit Party shall
contribute the maximum portion that it is permitted to pay and satisfy under
Applicable Law to the payment and satisfaction of all Indemnified Liabilities
incurred by Indemnitees or any of them.

(b) To the extent permitted by Applicable Law, no Credit Party shall assert, and
each Credit Party hereby waives, any claim against each Lender, each Agent,
Issuing Bank, Arranger and their respective Affiliates, directors, employees,
attorneys, agents or sub-agents, 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,
as a result of, or in any way related to, this Agreement or any Credit Document
or any agreement or instrument contemplated hereby or thereby or referred to
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transactions contemplated hereby or thereby, any Loan or the use of the proceeds
thereof or any act or omission or event occurring in connection therewith, and
each Credit Party 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. No Indemnitee referred to above shall be liable
for any damages arising from the use by unintended recipients of any information
or other materials distributed by it through telecommunications, electronic or
other information transmission systems in connection with this Agreement or the
other Credit Documents or the transactions contemplated hereby or thereby.

10.4 Set-Off. In addition to any rights now or hereafter granted under
Applicable Law and not by way of limitation of any such rights, upon the
occurrence of any Event of Default each Lender is hereby authorized by each
Credit Party at any time or from time to time subject to the consent of
Administrative Agent (such consent not to be unreasonably withheld or delayed),
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 (in whatever currency))
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 (in whatever currency) against and
on account of the obligations and liabilities of any Credit Party to such Lender
hereunder, the Letters of Credit and participations therein and under the other
Credit Documents, including all claims of any nature or description arising out
of or connected hereto, the Letters of Credit and participations therein or with
any other Credit Document, irrespective of whether or not (a) such Lender shall
have made any demand hereunder or (b) the principal of or the interest on the
Loans or any amounts in respect of the Letters of Credit 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. The applicable Lender shall notify Borrower and Administrative Agent
of such set-off and application, provided that any failure or any delay in
giving such notice shall not affect the validity of any such set-off and
application under this Section 10.4.

10.5 Amendments and Waivers.

(a) Requisite Lenders’ Consent. Subject to the additional requirements of
Sections 10.5(b) and 10.5(c), no amendment, modification, termination or waiver
of any provision of the Credit Documents, or consent to any departure by any
Credit Party therefrom, shall in any event be effective without the written
concurrence of the Requisite Lenders; provided, that Administrative Agent may,
with the consent of Borrower only, amend, modify or supplement this Agreement to
cure any ambiguity, omission, defect or inconsistency, so long as such
amendment, modification or supplement does not adversely affect the rights of
any Lender or Issuing Bank.

(b) Affected Lenders’ Consent. Without the written consent of each Lender that
would be directly affected thereby, no amendment, modification, termination, or
consent shall be effective if the effect thereof would:

(i) extend the scheduled final maturity of any Loan or Note;

(ii) waive, reduce or postpone any scheduled repayment (but not prepayment);

(iii) extend the stated expiration date of any Letter of Credit beyond the
Revolving Commitment Termination Date;

(iv) reduce the rate of interest on any Loan (other than any waiver of any
increase in the interest rate applicable to any Loan pursuant to Section 2.10)
or any fee or any premium or other amount payable hereunder;

 

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(v) extend the time for payment of any such interest or fees;

(vi) reduce the principal amount of any Loan or any reimbursement obligation in
respect of any Letter of Credit;

(vii) amend, modify, terminate or waive any provision of Section 2.13(b)(iii),
this Section 10.5(b), Section 10.5(c) or any other provision of this Agreement
that expressly provides that the consent of all Lenders is required or for the
pro rata treatment among Lenders;

(viii) amend the definition of “Requisite Lenders” or “Pro Rata Share”;
provided, with the consent of Requisite Lenders, additional extensions of credit
pursuant hereto may be included in the determination of “Requisite Lenders” or
“Pro Rata Share” on substantially the same basis as the Term Loan Commitments,
the Term Loans, Revolving Commitments and the Revolving Loans are included on
the Second Restatement Date;

(ix) release all or substantially all of the Collateral or all or substantially
all of the Guarantors from the Guaranty except as expressly provided in the
Credit Documents; or

(x) consent to the assignment or transfer by any Credit Party of any of its
rights and obligations under any Credit Document;

provided that for the avoidance of doubt, all Lenders shall be deemed directly
affected thereby with respect to any amendment described in clauses (vii),
(viii), (ix) and (x).

(c) Other Consents. No amendment, modification, termination or waiver of any
provision of the Credit Documents, or consent to any departure by any Credit
Party therefrom, shall:

(i) increase any Revolving Commitment of any Lender over the amount thereof then
in effect without the consent of such Lender; provided that no amendment,
modification or waiver of any condition precedent, covenant, Default or Event of
Default shall constitute an increase in any Revolving Commitment of any Lender;

(ii) amend, modify, terminate or waive any provision hereof relating to the
Swing Line Sublimit or the Swing Line Loans without the consent of Swing Line
Lender;

(iii) alter the required application of any repayments or prepayments as between
Classes pursuant to Section 2.17 without the consent of Lenders holding more
than 50% of the aggregate Tranche A Term Loan Exposure of all Lenders, Tranche B
Term Loan Exposure of all Lenders, New Term Loan Exposure of all Lenders,
Revolving Exposure of all Lenders, as applicable, of each Class which is being
allocated a lesser repayment or prepayment as a result thereof; provided that
Requisite Lenders may waive, in whole or in part, any prepayment so long as the
application, as between Classes, of any portion of such prepayment which is
still required to be made is not altered;

(iv) amend, modify, terminate or waive any obligation of Lenders relating to the
purchase of participations in Letters of Credit as provided in Section 2.4(e)
without the written consent of Administrative Agent and of Issuing Bank;

(v) amend, modify or waive this Agreement, the Second Amended and Restated
Pledge and Security Agreement, the Canadian Pledge and Security Agreement, the
Quebec Security Documents, the Barbados Security Documents, the Luxembourg
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Swiss Security Documents, so as to alter the ratable treatment of Obligations
arising under the Credit Documents and Obligations arising under Hedge
Agreements or Cash Management Agreements or the definition of “Lender
Counterparty,” “Hedge Agreement,” “Cash Management Agreement,” “Obligations,” or
“Secured Obligations” (as defined in any applicable Collateral Document) in each
case in a manner adverse to any Lender Counterparty with Obligations then
outstanding without the written consent of any such Lender Counterparty;

(vi) amend, modify, terminate or waive any provision of Section 9 as the same
applies to any Agent, or any other provision hereof as the same applies to the
rights or obligations of any Agent, in each case without the consent of such
Agent;

(vii) amend any provision relating solely to the Delayed Draw Commitments
without the written consent of Lenders holding a majority in aggregate principal
amount of the Delayed Draw Commitments;

(viii) increase any Delayed Draw Commitment of any Lender over the amount
thereof then in effect without the consent of such Lender; provided that no
amendment, modification or waiver of any condition precedent, covenant, Default
or Event of Default shall constitute an increase in any Delayed Draw Commitment
of any Lender; or

(ix) waive any condition to the making of any Revolving Loan or Delayed Draw
Term Loan without the consent of a majority in interest of the Lenders holding
Revolving Commitments or Delayed Draw Commitments, as applicable.

(d) Notwithstanding Section 10.5(a), any such agreement that shall extend the
Revolving Commitment Termination Date or the Term Loan Maturity Date, as
applicable, of one or more Lenders (the “Extending Lender”) and does not amend
any other provision of this Agreement or the Credit Documents other than to
change the Applicable Margin of Extending Lenders shall only require the consent
of Borrower, the Administrative Agent and the Extending Lenders.

Notwithstanding anything to the contrary, without the consent of any other
Person, the applicable Credit Party or Credit Parties and the Administrative
Agent and/or Collateral Agent may (in its or their respective sole discretion,
or shall, to the extent required by any Credit Document) enter into any
amendment or waiver of any Credit Document, or enter into any new agreement or
instrument, to effect the granting, perfection, protection, expansion or
enhancement of any security interest in Collateral or additional property to
become Collateral for the benefit of the Secured Parties, or as required by
local law to give effect to, or protect any security interest for the benefit of
the Secured Parties, in any property or so that the security interests therein
comply with applicable law.

(e) Execution of Amendments, etc. Administrative Agent may, but shall have no
obligation to, with the concurrence of any Lender, execute amendments,
modifications, waivers or consents on behalf of such Lender. Any waiver or
consent shall be effective only in the specific instance and for the specific
purpose for which it was given. No notice to or demand on any Credit Party in
any case shall entitle any Credit Party to any other or further notice or demand
in similar or other circumstances. Any amendment, modification, termination,
waiver or consent effected in accordance with this Section 10.5 shall be binding
upon each Lender at the time outstanding, each future Lender and, if signed by a
Credit Party, on such Credit Party.

 

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10.6 Successors and Assigns; Participations.

(a) Generally. This Agreement shall be binding upon the parties hereto and their
respective successors and assigns and shall inure to the benefit of the parties
hereto and the successors and assigns of Lenders. No Credit Party’s rights or
obligations hereunder nor any interest therein may be assigned or delegated by
any Credit Party without the prior written consent of all Lenders. Nothing in
this Agreement, expressed or implied, shall be construed to confer upon any
Person (other than the parties hereto, Indemnitee Agent Parties under
Section 9.6 and Indemnitees under Section 10.3, their respective successors and
assigns permitted hereby and, to the extent expressly contemplated hereby,
Affiliates of each of the Agents and Lenders) any legal or equitable right,
remedy or claim under or by reason of this Agreement.

(b) Register. Borrower, Administrative Agent and Lenders shall deem and treat
the Persons listed as Lenders in the Register as the holders and owners of the
corresponding Commitments and Loans listed therein for all purposes hereof, and
no assignment or transfer of any such Commitment or Loan shall be effective, in
each case, unless and until recorded in the Register following receipt of a
fully executed Assignment Agreement effecting the assignment or transfer
thereof, together with the required forms and certificates regarding tax matters
and any fees payable in connection with such assignment, in each case, as
provided in Section 10.6(d). Each assignment shall be recorded in the Register
promptly following receipt by the Administrative Agent of the fully executed
Assignment Agreement and all other necessary documents and approvals, prompt
notice thereof shall be provided to Borrower and a copy of such Assignment
Agreement shall be maintained, as applicable. The date of such recordation of a
transfer shall be referred to herein as the “Assignment Effective Date.” Any
request, authority or consent of any Person who, at the time of making such
request or giving such authority or consent, is listed in the Register as a
Lender shall be conclusive and binding on any subsequent holder, assignee or
transferee of the corresponding Commitments or Loans, absent manifest error.

(c) Right to Assign. Each Lender shall have the right at any time to sell,
assign or transfer all or a portion of its rights and obligations under this
Agreement, including all or a portion of its Commitment or Loans owing to it or
other Obligations; provided, however, that (x) pro rata assignments shall not be
required and (y) each assignment, other than pursuant to Section 10.6(h), shall
be of a uniform, and not varying, percentage of all rights and obligations under
and in respect of any Loan and any related Commitments):

(i) to any Person meeting the criteria of clause (i) of the definition of the
term “Eligible Assignee” upon the giving of notice to Borrower and
Administrative Agent and with the prior written consent (such consent not to be
unreasonably withheld or delayed) of Issuing Bank at the time of such assignment
in the case of assignments of Revolving Loans or Revolving Commitments; and

(ii) to any Person meeting the criteria of clause (ii) of the definition of the
term “Eligible Assignee” upon giving of notice to Borrower and Administrative
Agent and, (x) in the case of assignments of Tranche A Term Loans, Tranche B
Term Loans, Revolving Loans or Revolving Commitments to any such Person (except
in the case of assignments made by or to GSLP or any of its affiliates),
consented to by each of Borrower and Administrative Agent and (y) in the case of
assignments of Revolving Loans or Revolving Commitments to any such Person,
consented to by Issuing Bank; provided that any such consent (x) shall not be
unreasonably withheld or delayed or (y) in the case of Borrower shall not be
required at any time an Event of Default shall have occurred and then be
continuing; provided, further that (A) each such assignment pursuant to this
Section 10.6(c)(ii) shall be in an aggregate amount of not less than $1,000,000
(or such lesser amount as may be agreed to by Borrower and Administrative Agent
or as shall constitute

 

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the aggregate amount of the Tranche B Term Loans, Revolving Commitments and
Revolving Loans of the assigning Lender) with respect to the assignment of the
Tranche B Term Loans, Revolving Commitments and Revolving Loans, and $2,500,000
(or such lesser amount as may be agreed to by Borrower and Administrative Agent
or as shall constitute the aggregate of the Tranche A Term Loan) with respect to
the assignment of Tranche A Term Loans and (B) any required Borrower consent
shall be deemed to have been given to any assignment of Loans or Commitments
unless it shall object thereto by written notice to Administrative Agent within
5 Business Days after having received notice thereof.

(d) Mechanics. Assignments and assumptions of Loans and Commitments by Lenders
shall be effected by manual execution and delivery to Administrative Agent of an
Assignment Agreement. Assignments made pursuant to the foregoing provision shall
be effective as of the Assignment Effective Date. In connection with all
assignments there shall be delivered to Administrative Agent such forms,
certificates or other evidence, if any, with respect to United States federal
income tax withholding matters as the assignee under such Assignment Agreement
may be required to deliver pursuant to Section 2.20(d), together with payment to
Administrative Agent of a registration and processing fee of $3,500 (except that
no such registration and processing fee shall be payable (x) in connection with
an assignment by or to GSLP or any Affiliate thereof or (y) in the case of an
assignee which is already a Lender or is an Affiliate or Related Fund of a
Lender or a Person under common management with a Lender).

(e) Representations and Warranties of Assignee. Each Lender, upon execution and
delivery hereof or upon succeeding to an interest in the Commitments and Loans,
as the case may be, represents and warrants as of the Third Restatement Date or
as of the Assignment Effective Date that (i) it is an Eligible Assignee; (ii) it
has experience and expertise in the making of or investing in commitments or
loans such as the applicable Commitments or Loans, as the case may be; and
(iii) it will make or invest in, as the case may be, its Commitments or Loans
for its own account in the ordinary course and without a view to distribution of
such Commitments or Loans within the meaning of the Securities Act or the
Exchange Act or other federal securities laws (it being understood that, subject
to the provisions of this Section 10.6, the disposition of such Revolving
Commitments or Loans or any interests therein shall at all times remain within
its exclusive control).

(f) Effect of Assignment. Subject to the terms and conditions of this
Section 10.6, as of the “Assignment Effective Date” (i) the assignee thereunder
shall have the rights and obligations of a “Lender” hereunder to the extent of
its interest in the Loans and Commitments so assigned as reflected in the
Register and shall thereafter be a party hereto and a “Lender” for all purposes
hereof; (ii) the assigning Lender thereunder shall, to the extent that rights
and obligations hereunder have been assigned to the assignee, relinquish its
rights (other than any rights which survive the termination hereof under
Section 10.8) and be released from its obligations hereunder (and, in the case
of an assignment covering all or the remaining portion of an assigning Lender’s
rights and obligations hereunder, such Lender shall cease to be a party hereto
on the Assignment Effective Date); provided that anything contained in any of
the Credit Documents to the contrary notwithstanding, (y) Issuing Bank shall
continue to have all rights and obligations thereof with respect to such Letters
of Credit until the cancellation or expiration of such Letters of Credit and the
reimbursement of any amounts drawn thereunder and (z) such assigning Lender
shall continue to be entitled to the benefit of all indemnities hereunder as
specified herein with respect to matters arising out of the prior involvement of
such assigning Lender as a Lender hereunder; (iii) the Commitments shall be
modified to reflect any Commitment of such assignee and any Revolving Commitment
of such assigning Lender, if any; and (iv) if any such assignment occurs after
the issuance of any Note hereunder, the assigning Lender shall, upon the
effectiveness of such assignment or as promptly thereafter as practicable,
surrender its applicable Notes to Administrative Agent for cancellation, and
thereupon Borrower shall issue and deliver new Notes, if so requested by the
assignee and/or assigning Lender, to such assignee and/or to such assigning
Lender, with appropriate insertions, to reflect the new Commitments and/or
outstanding Loans of the assignee and/or the assigning Lender.

 

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(g) Participations.

(1) Each Lender shall have the right at any time to sell one or more
participations to any Person (other than Borrower, its Subsidiaries or any of
its Affiliates) in all or any part of its Commitments or Loans or in any other
Obligation.

(2) The holder of any such participation, other than an Affiliate of the Lender
granting such participation, shall not be entitled to require such Lender to
take or omit to take any action hereunder except that the participation
agreement may provide that the Lender must first obtain the participant’s
consent with respect to any amendment, modification or waiver that would
(A) extend the final scheduled maturity of any Loan, Note or Letter of Credit
(unless such Letter of Credit is not extended beyond the Revolving Commitment
Termination Date) in which such participant is participating, or reduce the rate
or extend the time of payment of interest or fees thereon (except in connection
with a waiver of applicability of any post default increase in interest rates)
or reduce the principal amount thereof, or increase the amount of the
participant’s participation over the amount thereof then in effect (it being
understood that a waiver of any Default or Event of Default or of a mandatory
reduction in the Commitment shall not constitute a change in the terms of such
participation, and that an increase in any Commitment or Loan shall be permitted
without the consent of any participant if the participant’s participation is not
increased as a result thereof), (B) consent to the assignment or transfer by any
Credit Party of any of its rights and obligations under this Agreement or
(C) release all or substantially all of the Collateral under the Collateral
Documents (except as expressly provided in the Credit Documents) supporting the
Loans hereunder in which such participant is participating. Each Lender that
sells a participation 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 the principal amounts (and stated interest) of each
participant’s interest in the Loans or other obligations under this Agreement
(the “Participant Register”). The entries in the Participant Register shall be
conclusive and such Lender shall treat each person whose name is recorded in the
Participant Register as the owner of such participation for all purposes of this
Agreement notwithstanding any notice to the contrary.

(3) Borrower agrees that each participant shall be entitled to the benefits of
Sections 2.18(c), 2.19 and 2.20 to the same extent as if it were a Lender
(subject to the requirements and limitations thereof, including the requirement
to provide forms under Section 2.20(d)) and had acquired its interest by
assignment pursuant to paragraph (c) of this Section; provided that a
participant shall not be entitled to receive any greater payment under
Section 2.19 or 2.20 than the applicable Lender would have been entitled to
receive with respect to the participation sold to such participant, except to
the extent that entitlement to a greater payment results from a change in law
that occurs after such Participant acquires the applicable participation. To the
extent permitted by law, each participant also shall be entitled to the benefits
of Section 10.4 as though it were a Lender, provided such participant agrees to
be subject to Section 2.17 as though it were a Lender.

(h) SPC. Notwithstanding anything to the contrary contained herein, any Lender
(a “Granting Lender”) may grant to a special purpose funding vehicle identified
as such in writing from time to time by the Granting Lender to Administrative
Agent and Borrower (an “SPC”) the option to provide all or any part of any Loan
that such Granting Lender would otherwise be obligated to make pursuant to this
Agreement; provided that (i) nothing herein shall constitute a commitment by any
SPC to fund any Loan, and (ii) if an SPC elects not to exercise such option or
otherwise fails to make all or any part of such Loan, the Granting Lender shall
be obligated to make such Loan pursuant to the terms hereof. Each party hereto
hereby agrees that (i) an SPC shall be entitled to the benefits of Sections
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the same extent as if it were a Lender (subject to the requirements and
limitations thereof, including the requirement to provide forms under
Section 2.20(d)) and had acquired its interest by assignment pursuant to
paragraph (c) of this Section; provided that an SPC shall not be entitled to
receive any greater payment under Section 2.19 or 2.20 than the applicable
Lender would have been entitled to receive with respect to the Loans subject to
such option, except to the extent that entitlement to a greater payment results
from a change in law that occurs after such SPC acquires such option, (ii) no
SPC shall be liable for any indemnity or similar payment obligation under this
Agreement for which a Lender would be liable, and (iii) the Granting Lender
shall for all purposes, including the approval of any amendment, waiver or other
modification of any provision of any Credit Document, remain the lender of
record hereunder. The making of a Loan by an SPC hereunder shall utilize the
Commitment of the Granting Lender to the same extent, and as if, such Loan were
made by such Granting Lender. Notwithstanding anything to the contrary contained
herein, any SPC may (i) with notice to, but without prior consent of Borrower
and Administrative Agent and with the payment of a processing fee of $3,500,
assign all or any portion of its right to receive payment with respect to any
Loan to the Granting Lender and (ii) disclose on a confidential basis any
non-public information relating to its funding of Loans to any rating agency,
commercial paper dealer or provider of any surety or Guarantee or credit or
liquidity enhancement to such SPC.

(i) Certain Other Assignments and Participations. In addition to any other
assignment or participation permitted pursuant to this Section 10.6, any Lender
may assign and/or pledge all or any portion of its Loans, the other Obligations
owed by or to such Lender, and its Notes, if any, to secure obligations of such
Lender including any Federal Reserve Bank or any central bank having
jurisdiction over such Lender as collateral security pursuant to Regulation A of
the Board of Governors and any operating circular issued by such Federal Reserve
Bank or such other central bank having jurisdiction over such Lender; provided
that no Lender, as between Borrower and such Lender, shall be relieved of any of
its obligations hereunder as a result of any such assignment and pledge, and
provided further that in no event shall the applicable Federal Reserve Bank,
pledgee or trustee be considered to be a “Lender” or be entitled to require the
assigning Lender to take or omit to take any action hereunder.

10.7 Independence of Covenants. All covenants hereunder shall be given
independent effect so that if a particular action or condition is not permitted
by any of such covenants, the fact that it would be permitted by an exception
to, or would otherwise be within the limitations of, another covenant shall not
avoid the occurrence of a Default or an Event of Default if such action is taken
or condition exists.

10.8 Survival of Representations, Warranties and Agreements. All
representations, warranties and agreements made herein shall survive the
execution and delivery hereof and the making of any Credit Extension.
Notwithstanding anything herein or implied by law to the contrary, the
agreements of each Credit Party set forth in Sections 2.18(c), 2.19, 2.20, 10.2,
10.3 and 10.4 and the agreements of Lenders set forth in Sections 2.17, 9.3(b)
and 9.6 shall survive the payment of the Loans, the cancellation or expiration
of the Letters of Credit and the reimbursement of any amounts drawn thereunder,
and the termination hereof.

10.9 No Waiver; Remedies Cumulative. No failure or delay on the part of any
Agent or any Lender in the exercise of any power, right or privilege hereunder
or under any other Credit Document shall impair such power, right or privilege
or be construed to be a waiver of any default or acquiescence therein, nor shall
any single or partial exercise of any such power, right or privilege preclude
other or further exercise thereof or of any other power, right or privilege. The
rights, powers and remedies given to each Agent and each Lender hereby are
cumulative and shall be in addition to and independent of all rights, powers and
remedies existing by virtue of any statute or rule of law or in any of the other
Credit Documents or any of the Hedge Agreements or Cash Management Agreements.
Any forbearance or failure to exercise, and any delay in exercising, any right,
power or remedy hereunder shall not impair any such right, power or remedy or be
construed to be a waiver thereof, nor shall it preclude the further exercise of
any such right, power or remedy.

 

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10.10 Marshalling; Payments Set Aside. Neither any 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 Administrative Agent
or Lenders (or to Administrative Agent, on behalf of Lenders), or any Agent or
Lenders enforce any security interests or exercise their rights of set-off, and
such payment or payments or the proceeds of such enforcement or set-off or any
part thereof are subsequently invalidated, declared to be fraudulent or
preferential, set aside and/or required to be repaid to a trustee, receiver or
any other party under any bankruptcy law, any other state, provincial,
territorial 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 set-off had not occurred.

10.11 Severability. In case any provision in or obligation hereunder or under
any other Credit 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.

10.12 Obligations Several; Independent Nature of Lenders’ Rights. The
obligations of Lenders hereunder are several and no Lender shall be responsible
for the obligations or Commitment of any other Lender hereunder. Nothing
contained herein or in any other Credit Document, and no action taken by Lenders
pursuant hereto or thereto, shall be deemed to constitute Lenders as a
partnership, an association, a joint venture or any other kind of entity. The
amounts payable at any time hereunder to each Lender shall be a separate and
independent debt, and each Lender shall be entitled to protect and enforce its
rights arising out hereof and it shall not be necessary for any other Lender to
be joined as an additional party in any proceeding for such purpose.

10.13 Headings. 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.

10.14 APPLICABLE LAW. THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE
PARTIES HEREUNDER SHALL BE GOVERNED BY, AND SHALL BE CONSTRUED AND ENFORCED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.

10.15 CONSENT TO JURISDICTION.

(a) SUBJECT TO CLAUSE (E) OF THE FOLLOWING SENTENCE, ALL JUDICIAL PROCEEDINGS
BROUGHT AGAINST ANY PARTY ARISING OUT OF OR RELATING HERETO OR ANY OTHER CREDIT
DOCUMENTS, OR ANY OF THE OBLIGATIONS, SHALL BE BROUGHT IN ANY STATE OR FEDERAL
COURT OF COMPETENT JURISDICTION IN THE BOROUGH OF MANHATTAN IN THE STATE, COUNTY
AND CITY OF NEW YORK. BY EXECUTING AND DELIVERING THIS AGREEMENT, EACH CREDIT
PARTY, FOR ITSELF AND IN CONNECTION WITH ITS PROPERTIES, IRREVOCABLY (A) ACCEPTS
GENERALLY AND UNCONDITIONALLY THE EXCLUSIVE JURISDICTION AND VENUE OF SUCH
COURTS (OTHER THAN WITH RESPECT TO ACTIONS BY ANY AGENT IN RESPECT OF RIGHTS
UNDER ANY COLLATERAL DOCUMENT GOVERNED BY LAWS OTHER THAN THE LAWS OF THE STATE
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COLLATERAL SUBJECT THERETO); (B) WAIVES ANY DEFENSE OF FORUM NON CONVENIENS;
(C) AGREES THAT SERVICE OF ALL PROCESS IN ANY SUCH PROCEEDING IN ANY SUCH COURT
MAY BE MADE BY REGISTERED OR CERTIFIED MAIL, RETURN RECEIPT REQUESTED, TO THE
APPLICABLE CREDIT PARTY AT ITS ADDRESS PROVIDED IN ACCORDANCE WITH SECTION 10.1;
(D) AGREES THAT SERVICE AS PROVIDED IN CLAUSE (C) ABOVE IS SUFFICIENT TO CONFER
PERSONAL JURISDICTION OVER THE APPLICABLE CREDIT PARTY IN ANY SUCH PROCEEDING IN
ANY SUCH COURT, AND OTHERWISE CONSTITUTES EFFECTIVE AND BINDING SERVICE IN EVERY
RESPECT; AND (E) AGREES THAT AGENTS AND LENDERS RETAIN THE RIGHT TO SERVE
PROCESS IN ANY OTHER MANNER PERMITTED BY LAW OR TO BRING PROCEEDINGS AGAINST ANY
CREDIT PARTY IN THE COURTS OF ANY OTHER JURISDICTION IN CONNECTION WITH THE
EXERCISE OF ANY RIGHTS UNDER ANY SECURITY DOCUMENT OR THE ENFORCEMENT OF ANY
JUDGMENT.

(b) EACH CREDIT PARTY THAT IS ORGANIZED UNDER THE LAWS OF A JURISDICTION OUTSIDE
THE UNITED STATES HEREBY APPOINTS VPI AS ITS AGENT FOR SERVICE OF PROCESS IN ANY
MATTER RELATED TO THIS AGREEMENT OR THE OTHER CREDIT DOCUMENTS AND VPI HEREBY
ACCEPTS SUCH APPOINTMENT.

10.16 WAIVER OF JURY TRIAL. EACH OF THE PARTIES HERETO HEREBY AGREES TO WAIVE
ITS RESPECTIVE RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON
OR ARISING HEREUNDER OR UNDER ANY OF THE OTHER CREDIT DOCUMENTS OR ANY DEALINGS
BETWEEN THEM RELATING TO THE SUBJECT MATTER OF THIS LOAN TRANSACTION OR THE
LENDER/BORROWER RELATIONSHIP THAT IS BEING ESTABLISHED. THE SCOPE OF THIS WAIVER
IS INTENDED TO BE ALL ENCOMPASSING OF ANY AND ALL DISPUTES THAT MAY BE FILED IN
ANY COURT AND THAT RELATE TO THE SUBJECT MATTER OF THIS TRANSACTION, INCLUDING
CONTRACT CLAIMS, TORT CLAIMS, BREACH OF DUTY CLAIMS AND ALL OTHER COMMON LAW AND
STATUTORY CLAIMS. EACH PARTY HERETO ACKNOWLEDGES THAT THIS WAIVER IS A MATERIAL
INDUCEMENT TO ENTER INTO A BUSINESS RELATIONSHIP, THAT EACH HAS ALREADY RELIED
ON THIS WAIVER IN ENTERING INTO THIS AGREEMENT, AND THAT EACH WILL CONTINUE TO
RELY ON THIS WAIVER IN ITS RELATED FUTURE DEALINGS. EACH PARTY HERETO FURTHER
WARRANTS AND REPRESENTS THAT IT HAS REVIEWED THIS WAIVER WITH ITS LEGAL COUNSEL
AND THAT IT KNOWINGLY AND VOLUNTARILY WAIVES ITS JURY TRIAL RIGHTS FOLLOWING
CONSULTATION WITH LEGAL COUNSEL. THIS WAIVER IS IRREVOCABLE, MEANING THAT IT MAY
NOT BE MODIFIED EITHER ORALLY OR IN WRITING (OTHER THAN BY A MUTUAL WRITTEN
WAIVER SPECIFICALLY REFERRING TO THIS SECTION 10.16 AND EXECUTED BY EACH OF THE
PARTIES HERETO), AND THIS WAIVER SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS,
RENEWALS, SUPPLEMENTS OR MODIFICATIONS HERETO OR ANY OF THE OTHER CREDIT
DOCUMENTS OR TO ANY OTHER DOCUMENTS OR AGREEMENTS RELATING TO THE LOANS MADE
HEREUNDER. IN THE EVENT OF LITIGATION, THIS AGREEMENT MAY BE FILED AS A WRITTEN
CONSENT TO A TRIAL BY THE COURT.

10.17 Confidentiality. Each Agent and each Lender (which term shall for the
purposes of this Section 10.17 include the Issuing Bank) shall hold all
Non-Public Information regarding Borrower and its Subsidiaries and their
businesses identified as such by Borrower or such Subsidiary (or which is
reasonably apparent to be of a confidential nature, even if not so identified)
and obtained by such Agent and such Lender pursuant to the requirements hereof
in accordance with such Agent’s and such Lender’s customary procedures for
handling confidential information of such nature, it being understood and agreed
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Borrower that, in any event, the Administrative Agent may disclose such
information to the Lenders and each Agent and each Lender may make
(i) disclosures of such information to Affiliates of such Lender and to their
respective agents and advisors (and to other Persons authorized by a Lender or
Agent to organize, present or disseminate such information in connection with
disclosures otherwise made in accordance with this Section 10.17),
(ii) disclosures of such information reasonably required by any bona fide or
potential assignee, transferee or participant in connection with the
contemplated assignment, transfer or participation of any Loans or any
participations therein or by any direct or indirect contractual counterparties
(or the professional advisors thereto) to any swap or derivative transaction
relating to Borrower and its obligations (provided that such assignees,
transferees, participants, counterparties and advisors are advised of and agree
to be bound by either the provisions of this Section 10.17 or other provisions
at least as restrictive as this Section 10.17), (iii) disclosure to any rating
agency when required by it, provided that, prior to any disclosure, such rating
agency shall undertake in writing to preserve the confidentiality of any
confidential information relating to Credit Parties received by it from any
Agent or any Lender, (iv) disclosures necessary in connection with the exercise
of any remedies hereunder or under any other Credit Document, (v) disclosures
required or requested by any Governmental Authority or pursuant to legal or
judicial process; provided that, unless specifically prohibited by Applicable
Law or court order, each Lender and each Agent shall make reasonable efforts to
notify Borrower of any request by any Governmental Authority or representative
thereof (other than any such request in connection with any examination of the
financial condition or other routine examination of such Lender by such
Governmental Authority) for disclosure of any such Non-Public Information
reasonably in advance of disclosure of such information (and each Agent and
Lender shall cooperate with Borrower and its Subsidiaries (at the sole cost and
expense of Borrower and its Subsidiaries) to limit any such disclosure) and
(vi) disclosures to any other Person with the written consent of the Borrower.
In addition, each Agent and each Lender may disclose the existence of this
Agreement and the information about this Agreement to service providers to
Agents and Lenders in connection with the administration and management of this
Agreement and the other Credit Documents.

10.18 Usury Savings Clause. If any provision of this Agreement or of any of the
other Credit Documents would obligate any Credit Party to make any payment of
interest or other amount payable to any Agent or any Lender in an amount or
calculated at a rate which would be prohibited by law or would result in a
receipt by such Agent or Lender of interest at a criminal rate (as such terms
are construed under the Criminal Code (Canada)) or in excess of the Highest
Lawful Rate, then notwithstanding such provisions, such amount or rate shall be
deemed to have been adjusted with retroactive effect to the maximum amount or
rate of interest, as the case may be, as would not be so prohibited by law or so
result in a receipt by such Agent or such Lender of interest at a criminal rate,
such adjustment to be effected, to the extent necessary, as follows:
(1) firstly, by reducing the amount or rate of interest required to be paid to
such Agent or such Lender under Section 2.8, and (2) thereafter, by reducing any
fees, commissions, premiums and other amounts required to be paid to such Agent
or such Lender which would constitute “interest” for purposes of Section 347 of
the Criminal Code (Canada) or for the purposes of determining the Highest Lawful
Rate. Notwithstanding the foregoing, it is the intention of Lenders and Borrower
to conform strictly to any applicable usury laws, and after giving effect to all
adjustments contemplated in the preceding sentence, if an Agent or Lender shall
have received an amount in excess of the maximum permitted by that section of
the Criminal Code (Canada) or by application of the Highest Lawful Rate, such
Credit Party shall be entitled, by notice in writing to such Agent or such
Lender, to obtain reimbursement from such Agent or such Lender in an amount
equal to such excess and, pending such reimbursement, such amount shall be
deemed to be an amount payable by such Agent or such Lender to such Credit
Party. Any amount or rate of interest referred to in this Section 10.18 shall be
determined in accordance with GAAP as an effective annual rate of interest over
the term that the applicable Loan remains outstanding on the assumption that any
charges, fees or expenses that fall within the meaning of “interest” (as defined
in the Criminal Code (Canada) or for the purposes of determining the Highest
Lawful Rate) shall, if they relate to a specific period of time, be prorated
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over the period from the Third Restatement Date to the later of the Revolving
Commitment Termination Date or the Term Loan Commitment Termination Date and, in
the event of a dispute, a certificate of an actuary appointed by Administrative
Agent shall be conclusive for the purposes of such determination absent manifest
error.

10.19 Counterparts. This Agreement may be executed in any number of
counterparts, each of which when so executed and delivered shall be deemed an
original, but all such counterparts together shall constitute but one and the
same instrument. Delivery of an executed counterpart to this Agreement by
facsimile transmission or other electronic transmission shall be effective as
delivery of a manually signed counterpart of this Agreement.

10.20 Effectiveness; Entire Agreement. This Agreement shall become effective
upon the execution of a counterpart hereof by each of the parties hereto and
receipt by Borrower and Administrative Agent of written notification of such
execution and authorization of delivery thereof.

10.21 PATRIOT Act; PCTFA. Each Lender to whom the PATRIOT Act applies and
Administrative Agent (for itself and not on behalf of any Lender) hereby
notifies each Credit Party that pursuant to the requirements of the PATRIOT Act
and the PCTFA, it is required to obtain, verify and record information that
identifies each Credit Party, which information includes the name and address of
each Credit Party and other information that will allow such Lender or
Administrative Agent, as applicable, to identify such Credit Party in accordance
with those Acts.

10.22 Electronic Execution of Assignments. The words “execution,” “signed,”
“signature,” and words of like import in any Assignment Agreement 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 or
enforceability as a manually executed signature or the use of a paper-based
recordkeeping system, as the case may be, to the extent and as provided for in
any Applicable Law, including the Federal Electronic Signatures in Global and
National Commerce Act, the New York State Electronic Signatures and Records Act,
or any other similar state laws based on the Uniform Electronic Transactions
Act, the Commerce Act (Ontario) or any similar provincial, territorial or
federal laws.

10.23 No Fiduciary Duty. Each Agent, each Lender and their Affiliates
(collectively, solely for purposes of this paragraph, the “Lenders”) may have
economic interests that conflict with those of Borrower, its stockholders and/or
its affiliates. Borrower agrees that nothing in the Credit Documents or
otherwise will be deemed to create an advisory, fiduciary or agency relationship
or fiduciary or other implied duty between any Lender, on the one hand, and
Borrower, its stockholders or its affiliates, on the other. The Credit Parties
acknowledge and agree that (i) the transactions contemplated by the Credit
Documents (including the exercise of rights and remedies hereunder and
thereunder) are arm’s-length commercial transactions between the Lenders, on the
one hand, and Borrower, on the other, and (ii) in connection therewith and with
the process leading thereto, (x) no Lender has assumed an advisory or fiduciary
responsibility in favor of Borrower, its stockholders or its affiliates with
respect to the transactions contemplated hereby (or the exercise of rights or
remedies with respect thereto) or the process leading thereto (irrespective of
whether any Lender has advised, is currently advising or will advise Borrower,
its stockholders or its Affiliates on other matters) or any other obligation to
Borrower except the obligations expressly set forth in the Credit Documents and
(y) each Lender is acting solely as principal and not as the agent or fiduciary
of Borrower, its management, stockholders, creditors or any other Person.
Borrower has consulted its own legal and financial advisors to the extent it
deemed appropriate and that it is responsible for making its own independent
judgment with respect to such transactions and the process leading thereto.
Borrower agrees that it will not claim that any Lender has rendered advisory
services of any nature or respect, or owes a fiduciary or similar duty to
Borrower, in connection with such transaction or the process leading thereto.

 

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10.24 Judgment Currency.

(a) If, for the purpose of obtaining or enforcing judgment against any Credit
Party in any court in any jurisdiction, it becomes necessary to convert into any
other currency (such other currency being hereinafter in this Section 10.24
referred to as the “Judgment Currency”) an amount due under any Credit Document
in any currency (the “Obligation Currency”) other than the Judgment Currency,
the conversion shall be made at the rate of exchange prevailing on the Business
Day immediately preceding the date of actual payment of the amount due, in the
case of any proceeding in the courts of any jurisdiction that will give effect
to such conversion being made on such date, or the date on which the judgment is
given, in the case of any proceeding in the courts of any other jurisdiction
(the applicable date as of which such conversion is made pursuant to this
Section 10.24 being hereinafter in this Section 10.24 referred to as the
“Judgment Conversion Date”).

(b) If, in the case of any proceeding in the court of any jurisdiction referred
to in Section 10.24(a), there is a change in the rate of exchange prevailing
between the Judgment Conversion Date and the date of actual receipt for value of
the amount due, then the applicable Credit Party or Credit Parties shall pay
such additional amount (if any, but in any event not a lesser amount) as may be
necessary to ensure that the amount actually received in the Judgment Currency,
when converted at the rate of exchange prevailing on the date of payment, will
provide the amount of the Obligation Currency which could have been purchased
with the amount of the Judgment Currency stipulated in the judgment or judicial
order at the rate of exchange prevailing on the Judgment Conversion Date. Any
amount due from any Credit Party under this Section 10.24(b) shall be due as a
separate debt and shall not be affected by judgment being obtained for any other
amounts due under or in respect of any of the Credit Documents.

(c) The term “rate of exchange” in this Section 10.24 means the rate of exchange
at which Administrative Agent, on the relevant date at or about 12:00 noon (New
York time), would be prepared to sell, in accordance with Administrative Agent’s
normal course foreign currency exchange practices, the Obligation Currency
against the Judgment Currency.

10.25 Joint and Several Liability. Notwithstanding any other provision contained
herein or in any other Credit Documents, if a “secured creditor” (as that term
is defined under the BIA) is determined by a court of competent jurisdiction not
to include a Person to whom obligations are owed on a joint or joint and several
basis, then any Canadian Credit Party’s Obligations (and the Obligations of each
other Credit Party with respect thereto), to the extent such Obligations are
secured, only shall be several obligations and not joint or joint and several
obligations.

10.26 Advice of Counsel; No Strict Construction. Each of the parties represents
to each other party hereto that it has discussed this Agreement and the other
Credit Documents with its counsel. The parties hereto have participated jointly
in the negotiation and drafting of this Agreement and the other Credit
Documents. In the event an ambiguity or question of intent or interpretation
arises, this Agreement and each of the other Credit Documents shall be construed
as if drafted jointly by the parties hereto and no presumption or burden of
proof shall arise favoring or disfavoring any party by virtue of the authorship
of any provisions of this Agreement or any other Credit Document.

10.27 Day Not a Business Day. In the event that any day on or before which any
action, calculation, determination or allocation is required to be taken
hereunder is not a Business Day, then such action, calculation, determination or
allocation shall be required to be taken at the requisite time on or before the
first succeeding day that is a Business Day thereafter, unless such day is in
the next calendar month, in which case such action, calculation, determination
or allocation shall be required to be taken at the requisite time on the first
preceding day that is a Business Day.

 

-134-

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

10.28 Limitations Act, 2002. Each of the parties hereto agrees that any and all
limitation periods provided for in the Limitations Act, 2002 (Ontario) or any
other Applicable Law that provides for or relates to limitation periods, shall
be excluded from application to the Obligations and any undertaking, covenant,
indemnity or other agreement of any Credit Party provided for in any Credit
Document to which it is a party in respect thereof, in each case to fullest
extent permitted by such Act or other Applicable Law.

[Remainder of page intentionally left blank]

 

-135-

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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed and delivered by their respective officers thereunto duly authorized as
of the date first written above.

 

VALEANT PHARMACEUTICALS INTERNATIONAL, INC., as Borrower By:  

/s/ Rajiv De Silva

  Name: Rajiv De Silva   Title: President & Chief Operating Officer VALEANT
PHARMACEUTICALS INTERNATIONAL, as Guarantor By:  

/s/ Rajiv De Silva

  Name: Rajiv De Silva   Title: President & Chief Operating Officer ATON PHARMA,
INC., as Guarantor By:  

/s/ Rajiv De Silva

  Name: Rajiv De Silva   Title: President & Chief Operating Officer CORIA
LABORATORIES, LTD., as Guarantor By:  

/s/ Rajiv De Silva

  Name: Rajiv De Silva   Title: President & Chief Operating Officer DOW
PHARMACEUTICAL SCIENCES, INC., as Guarantor By:  

/s/ Rajiv De Silva

  Name: Rajiv De Silva   Title: President & Chief Operating Officer

 

[Signature Page to Third Amended and Restated Credit and Guaranty Agreement]

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

VALEANT PHARMACEUTICALS NORTH AMERICA LLC, as Guarantor By:  

/s/ Rajiv De Silva

  Name: Rajiv De Silva   Title: President DR. LEWINN’S PRIVATE FORMULA
INTERNATIONAL, INC., as Guarantor By:  

/s/ Rajiv De Silva

  Name: Rajiv De Silva   Title: President OCEANSIDE PHARMACEUTICALS, INC., as
Guarantor By:  

/s/ Rajiv De Silva

  Name: Rajiv De Silva   Title: President PRINCETON PHARMA HOLDINGS, LLC, as
Guarantor By:  

/s/ Rajiv De Silva

  Name: Rajiv De Silva   Title: President PRIVATE FORMULA CORP., as Guarantor
By:  

/s/ Rajiv De Silva

  Name: Rajiv De Silva   Title: President RENAUD SKIN CARE LABORATORIES, INC.,
as Guarantor By:  

/s/ Rajiv De Silva

  Name: Rajiv De Silva   Title: President

 

[Signature Page to Third Amended and Restated Credit and Guaranty Agreement]

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

VALEANT BIOMEDICALS, INC., as Guarantor By:  

/s/ Rajiv De Silva

  Name: Rajiv De Silva   Title: President BIOVAIL AMERICAS CORP., as Guarantor
By:  

/s/ Rajiv De Silva

  Name: Rajiv De Silva   Title: President PRESTWICK PHARMACEUTICALS, INC., as
Guarantor By:  

/s/ Rajiv De Silva

  Name: Rajiv De Silva   Title: President VALEANT HOLDINGS (BARBADOS) SRL, as
Guarantor By:  

/s/ Graham Jackson

  Name: Graham Jackson   Title: VP, Commercial & Technical Operations VALEANT
INTERNATIONAL (BARBADOS) SRL, as Guarantor By:  

/s/ Graham Jackson

  Name: Graham Jackson   Title: VP, Commercial & Technical Operations BIOVAIL
LABORATORIES INTERNATIONAL (BARBADOS) SRL, as Guarantor By:  

/s/ Graham Jackson

  Name: Graham Jackson   Title: VP, Commercial & Technical Operations

 

[Signature Page to Third Amended and Restated Credit and Guaranty Agreement]

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

HYTHE PROPERTY INCORPORATED, as Guarantor By:  

/s/ Graham Jackson

  Name: Graham Jackson   Title: VP, Commercial & Technical Operations VALEANT
CANADA GP LIMITED, as Guarantor By:  

/s/ Robert R. Chai-Onn

  Name: Robert R. Chai-Onn   Title: Vice President VALEANT CANADA LP by its sole
general partner, VALEANT CANADA GP LIMITED, as Guarantor By:  

/s/ Robert R. Chai-Onn

  Name: Robert R. Chai-Onn   Title: Director V-BAC HOLDING CORP., as Guarantor
By:  

/s/ Robert R. Chai-Onn

  Name: Robert R. Chai-Onn   Title: Vice President BIOVAIL INTERNATIONAL,
S.A.R.L., as Guarantor By:  

/s/ Kuy Ly Ang

  Name: Kuy Ly Ang   Title: Director PHARMASWISS SA, as Guarantor By:  

/s/ Matthias Courvoisier

  Name: Matthias Courvoisier   Title: Director

 

[Signature Page to Third Amended and Restated Credit and Guaranty Agreement]

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

Signed by     Valeant Holdco 2 Pty Ltd (ACN 154 341 367)     in accordance with
section 127 of the Corporations Act 2001 by two directors:      

/s/ Robert Chai-Onn

   

/s/ Rajiv De Silva

  Signature of director     Signature of director  

Robert R. Chai-Onn

   

Rajiv De Silva

  Name of director (please print)     Name of director (please print)

Signed by

Wirra Holdings Pty Limited (ACN 122 216 577)
in accordance with section 127 of the Corporations Act 2001 by two directors:

     

/s/ Robert Chai-Onn

   

/s/ Howard B. Schiller

  Signature of director     Signature of director  

Robert R. Chai-Onn

   

Howard B. Schiller

  Name of director (please print)     Name of director (please print)

Signed by

Wirra Operations Pty Limited (ACN 122 250 088)

in accordance with section 127 of the Corporations Act 2001 by two directors:

     

/s/ Robert Chai-Onn

   

/s/ Howard B. Schiller

  Signature of director     Signature of director  

Robert R. Chai-Onn

   

Howard B. Schiller

  Name of director (please print)     Name of director (please print)

 

[Signature Page to Third Amended and Restated Credit and Guaranty Agreement]

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

Signed by

iNova Pharmaceuticals (Australia) Pty Limited (ACN 000 222 408)

in accordance with section 127 of the Corporations Act 2001 by two directors:

     

/s/ Robert Chai-Onn

   

/s/ Howard B. Schiller

  Signature of director     Signature of director  

Robert R. Chai-Onn

   

Howard B. Schiller

  Name of director (please print)     Name of director (please print)

Signed by

iNova Sub Pty Limited (ACN 134 398 815)

in accordance with section 127 of the Corporations Act 2001 by two directors:

     

/s/ Robert Chai-Onn

   

/s/ Howard B. Schiller

  Signature of director     Signature of director  

Robert R. Chai-Onn

   

Howard B. Schiller

  Name of director (please print)     Name of director (please print)

Signed by

Wirra IP Pty Limited (ACN 122 536 350)

in accordance with section 127 of the Corporations Act 2001 by two directors:

     

/s/ Robert Chai-Onn

   

/s/ Howard B. Schiller

  Signature of director     Signature of director  

Robert R. Chai-Onn

   

Howard B. Schiller

  Name of director (please print)     Name of director (please print)

 

[Signature Page to Third Amended and Restated Credit and Guaranty Agreement]

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

GOLDMAN SACHS LENDING PARTNERS LLC, as Administrative Agent, Collateral Agent,
Swing Line Lender and a Lender By:  

/s/ Sean Gilbride

  Name: Sean Gilbride   Title: Authorized Signatory

 

[Signature Page to Third Amended and Restated Credit and Guaranty Agreement]

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

JPMORGAN CHASE BANK, N.A.,
TORONTO BRANCH, as a Lender By:  

/s/ Michael N. Tam

  Name: Michael N. Tam   Title: Senior Vice President

 

[Signature Page to Third Amended and Restated Credit and Guaranty Agreement]

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

Morgan Stanley Bank, N.A., as a Lender By:  

/s/ Alice Lee

  Name: Alice Lee   Title: Authorized Signatory

 

[Signature Page to Third Amended and Restated Credit and Guaranty Agreement]

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

The Bank of Nova Scotia, as a Lender By:  

/s/ James Rhee

  Name: James Rhee   Title: Managing Director By:  

/s/ Christina Brennan

  Name: Christina Brennan   Title: Associate

 

[Signature Page to Third Amended and Restated Credit and Guaranty Agreement]

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

AMMC CLO IV, LIMITED AMMC CLO VI, LIMITED By:  

American Money Management Corp.,

as Collateral Manager

as a Lender By:  

/s/ Chester M. Eng

  Name: Chester M. Eng   Title: Senior Vice President

 

[Signature Page to Third Amended and Restated Credit and Guaranty Agreement]

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

Aozora Bank, Ltd., as a Lender By:  

/s/ Hiroaki Hayami

  Name: Hiroaki Hayami   Title: General Manager

 

[Signature Page to Third Amended and Restated Credit and Guaranty Agreement]

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

BANK OF AMERICA N.A., as a Lender By:  

/s/ Robert LaPorte

  Name: Robert LaPorte   Title: Vice President

 

[Signature Page to Third Amended and Restated Credit and Guaranty Agreement]

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

Barclays Bank PLC, as a Lender By:  

/s/ Lisa Minigh

  Name: Lisa Minigh   Title: Assistant Vice President

 

[Signature Page to Third Amended and Restated Credit and Guaranty Agreement]

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

Bank of Montreal, as a Lender By:  

/s/ Mark Piekos

  Name: Mark Piekos   Title: Managing Director

 

[Signature Page to Third Amended and Restated Credit and Guaranty Agreement]

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

Citibank, N.A., as a Lender By:  

/s/ Scott R. Evan

  Name: Scott R. Evan   Title: Attorney-in-Fact By:  

 

  Name:   Title:

 

[Signature Page to Third Amended and Restated Credit and Guaranty Agreement]

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

DNB Bank ASA (f/k/a DnB NOR Bank ASA), as a Lender By:  

/s/ Thomas Tangen

  Name: Thomas Tangen   Title: Senior Vice President By:  

/s/ Phil Kurpiewski

  Name: Phil Kurpiewski   Title: Senior Vice President

 

[Signature Page to Third Amended and Restated Credit and Guaranty Agreement]

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

Export Development Canada, an Existing Lender By:  

/s/ Trevor Mulligan

  Name: Trevor Mulligan   Title: Asset Manager By:  

/s/ Andrew Baechler

  Name: Andrew Baechler   Title: Loan Portfolio Manager

 

[Signature Page to Third Amended and Restated Credit and Guaranty Agreement]

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

Gulf Stream - Sextant CLO 2006-1, Ltd., as a Lender By:   Gulf Stream Asset
Management LLC
As Collateral Manager By:  

/s/ Joe Moroney

  Name: Joe Moroney   Title: Vice President

 

[Signature Page to Third Amended and Restated Credit and Guaranty Agreement]

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

Gulf Stream - Compass CLO 2005-II, Ltd., as a Lender By:   Gulf Stream Asset
Management LLC
As Collateral Manager By:  

/s/ Joe Moroney

  Name: Joe Moroney   Title: Vice President

 

[Signature Page to Third Amended and Restated Credit and Guaranty Agreement]

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

Gulf Stream - Compass CLO 2005-I, Ltd., as a Lender By:   Gulf Stream Asset
Management LLC
As Collateral Manager By:  

/s/ Joe Moroney

  Name: Joe Moroney   Title: Vice President

 

[Signature Page to Third Amended and Restated Credit and Guaranty Agreement]

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

HSBC Bank USA, N.A. as a Lender By:  

/s/ David Reading

  Name: David Reading   Title: Vice President

 

[Signature Page to Third Amended and Restated Credit and Guaranty Agreement]

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

HSBC Bank Canada, as a Lender By:  

/s/ Andrew Sclater

  Name:   Andrew Sclater   Title:   AVP Corporate Banking     HSBC Bank Canada
By:  

/s/ Ambar Bansal

  Name:   Ambar Bansal   Title:   Vice President     Regional Head of Corporate
    HSBC Bank Canada

 

[Signature Page to Third Amended and Restated Credit and Guaranty Agreement]

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

ICICI Bank Canada, as a Lender By:  

/s/ Arup Ganguly

  Name: Arup Ganguly   Title: V.P. and Head – Corporate Banking By:  

/s/ Sandeep Goel

  Name: Sandeep Goel   Title: V.P. and Chief Risk Officer

 

[Signature Page to Third Amended and Restated Credit and Guaranty Agreement]

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

CONFLUENT 4 LIMITED, As Lender By:   Loomis. Sayles & Company, L.P.,   As
Sub-Manager By:   Loomis, Sayles & Company, Incorporated,   Its General Partner
, as a Lender By:  

/s/ Mary McCarthy

  Name: Mary McCarthy   Title: Vice President

 

[Signature Page to Third Amended and Restated Credit and Guaranty Agreement]

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

Manufacturers Bank, as a Lender By:  

/s/ Sean R. Walker

  Name: Sean R. Walker   Title: By:  

 

  Name:   Title:

 

[Signature Page to Third Amended and Restated Credit and Guaranty Agreement]

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

Mizuho Corporate Bank, Ltd., as a Lender By:  

/s/ Bertram H. Tang

  Name: Bertram H. Tang   Title: Authorized Signatory

 

[Signature Page to Third Amended and Restated Credit and Guaranty Agreement]

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

Raymond James Bank, N.A. as successor to Raymond James Bank, FSB as Lender By:  

/s/ Alexander L. Rody

  Alexander L. Rody   Senior Vice President

 

[Signature Page to Third Amended and Restated Credit and Guaranty Agreement]

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

Royal Bank of Canada, as a Lender By:  

/s/ Dean Sas

  Name: Dean Sas   Title: Authorized Signatory

 

[Signature Page to Third Amended and Restated Credit and Guaranty Agreement]

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

SUMITOMO MITSUI BANKING CORPORATION, as a Lender By:  

/s/ David W. Kee

  Name: David W. Kee   Title: Managing Director

 

[Signature Page to Third Amended and Restated Credit and Guaranty Agreement]

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

SUNTRUST BANK, as a Lender By:  

/s/ Dana Dhaliwal

  Name: Dana Dhaliwal   Title: Director

 

[Signature Page to Third Amended and Restated Credit and Guaranty Agreement]

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

THE TORONTO-DOMINION BANK, as a Lender By:  

/s/ Nigel Sharpley

  Name: Nigel Sharpley   Title: Senior Manager, TD Commercial Bank By:  

/s/ Damian Savelli

  Name: Damian Savelli   Title: Credit Manager, TD Commercial Bank

 

[Signature Page to Third Amended and Restated Credit and Guaranty Agreement]

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

Union Bank, N.A., as a Lender By:  

/s/ Richard A. Lopatt

  Name: Richard A. Lopatt   Title: Vice President

 

[Signature Page to Third Amended and Restated Credit and Guaranty Agreement]

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

ATRIUM V

MADISON PARK FUNDING II, LTD.

MADISON PARK FUNDING III, LTD.

MADISON PARK FUNDING IV, LTD.

MADISON PARK FUNDING V, LTD.

MADISON PARK FUNDING VI, LTD.,
as a Lender

 

By:

  Credit Suisse Asset Management, LLC, as collateral manager     By:  

/s/ Thomas Flannery

     

Thomas Flannery

Authorized Signatory

BENTHAM WHOLESALE SYNDICATED LOAN FUND,
as a Lender By:   Credit Suisse Asset Management, LLC, as agent (sub-advisor)
for Challenger Investment Services Limited, the Responsible Entity for Bentham
Wholesale Syndicated Loan Fund     By:  

/s/ Thomas Flannery

      Thomas Flannery       Authorized Signatory CREDIT SUISSE FLOATING RATE
HIGH INCOME FUND,
as a Lender   By:   Credit Suisse Asset Management, LLC, as investment advisor  
  By:  

/s/ Thomas Flannery

      Thomas Flannery       Authorized Signatory COMMONWEALTH OF PENNSYLVANIA
TREASURY DEPARTMENT,
as a Lender  

By:

  Credit Suisse Asset Management, LLC, as investment advisor     By:  

/s/ Thomas Flannery

      Thomas Flannery       Authorized Signatory CALIFORNIA STATE TEACHERS’
RETIREMENT SYSTEM QUALCOMM GLOBAL TRADING, INC. ,
as a Lender   By:   Credit Suisse Asset Management, LLC, as investment manager  
  By:  

/s/ Thomas Flannery

      Thomas Flannery       Authorized Signatory AUSTRALIANSUPER,
as a Lender By:   Credit Suisse Asset Management, LLC, as sub-advisor to Bentham
Asset Management Pty Ltd. in its capacity as agent of and investment manager for
AustralianSuper Pty Ltd. in its capacity as trustee of AustralianSuper     By:  

/s/ Thomas Flannery

      Thomas Flannery       Authorized Signatory

 

[Signature Page to Third Amended and Restated Credit and Guaranty Agreement]

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

EXHIBIT A-1 TO

THIRD AMENDED AND RESTATED CREDIT AND GUARANTY AGREEMENT

FUNDING NOTICE

[            ], 20[  ]

Reference is made to the Third Amended and Restated Credit and Guaranty
Agreement, dated as of February 13, 2012 (as it may be amended, restated,
replaced, supplemented or otherwise modified from time to time, the “Credit
Agreement”; the terms defined therein and not otherwise defined herein being
used herein as therein defined), among Valeant Pharmaceuticals International,
Inc., a corporation continued under the federal laws of Canada (“Borrower”),
certain Subsidiaries of Borrower, as Guarantors, the Lenders party thereto from
time to time, Goldman Sachs Lending Partners LLC (“GSLP”), J.P. Morgan
Securities LLC and Morgan Stanley Senior Funding, Inc. (“Morgan Stanley”), as
Joint Lead Arrangers and Joint Bookrunners, JPMorgan Chase Bank, N.A.
(“JPMorgan”) and Morgan Stanley, as Co-Syndication Agents, JPMorgan, as Issuing
Bank, GSLP, as Administrative Agent and Collateral Agent, and the other Agents
party thereto.

Pursuant to Sections 2.1, 2.2 and 2.3 of the Credit Agreement, Borrower desires
that Lenders make the following Loans to Borrower in accordance with the
applicable terms and conditions of the Credit Agreement on [            ],
20[  ] (the “Credit Date”):

Revolving Loans

 

¨   

Base Rate Loans:

   $ [    ,    ,     ] 

¨

  

Eurodollar Rate Loans, with an initial Interest Period of          month(s):

   $ [    ,    ,     ] 

Swing Line Loans:

   $ [    ,    ,     ] 

Tranche B Term Loans

  

¨

  

Base Rate Loans:

   $ [    ,    ,     ] 

¨

  

Eurodollar Rate Loans, with an initial Interest

  

Period of          month(s):

   $ [    ,    ,     ] 

Borrower hereby certifies that:

(i) after making the Loans requested on the Credit Date, the Total Utilization
of Revolving Commitments shall not exceed the Revolving Commitments then in
effect;

(ii) as of the Credit Date, subject to the last paragraph of Section 3.1 of the
Credit Agreement, the representations and warranties contained in each of the
Credit Documents are true and correct in all material respects on and as of such
Credit Date to the same extent as though made on and as of such date, except to
the extent such representations and warranties specifically relate to an earlier
date, in which case such representations and warranties are true and correct in
all material respects on and as of such earlier date; provided that, in each
case, such materiality qualifier shall not be applicable to any representations
and warranties that are qualified or modified by materiality in the text
thereof;

 

EXHIBIT A-1-1

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

(iii) as of the Credit Date, subject to the last paragraph of Section 3.1 of the
Credit Agreement, no event has occurred and is continuing or would result from
the consummation of the borrowing contemplated hereby that would constitute an
Event of Default or a Default; and

(v) [with respect to the borrowings of Loans, as of the Credit Date, the
conditions set forth in Section 3.3 of the Credit Agreement shall have been
satisfied.]1

(iv) [with respect to the borrowings on the Third Restatement Date, as of the
Third Restatement Date, the conditions set forth in Sections 3.1 and 3.3 of the
Credit Agreement shall have been satisfied.]2

 

Dated as of the date first written above.     VALEANT PHARMACEUTICALS
INTERNATIONAL, INC.     By:  

 

      Name:       Title:

 

1 

To be included in Funding Notices for Loans that are not to be borrowed on the
Third Restatement Date.

2 

To be included in Funding Notices for Loans that are to be borrowed on the Third
Restatement Date.

 

EXHIBIT A-1-2

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

EXHIBIT A-2 TO

THIRD AMENDED AND RESTATED CREDIT AND GUARANTY AGREEMENT

CONVERSION/CONTINUATION NOTICE

Reference is made to the Third Amended and Restated Credit and Guaranty
Agreement, dated as of February 13, 2012 (as it may be amended, restated,
replaced, supplemented or otherwise modified from time to time, the “Credit
Agreement”; the terms defined therein and not otherwise defined herein being
used herein as therein defined), among Valeant Pharmaceuticals International,
Inc., a corporation continued under the federal laws of Canada (“Borrower”),
certain Subsidiaries of Borrower, as Guarantors, the Lenders party thereto from
time to time, Goldman Sachs Lending Partners LLC (“GSLP”), J.P. Morgan
Securities LLC and Morgan Stanley Senior Funding, Inc. (“Morgan Stanley”), as
Joint Lead Arrangers and Joint Bookrunners, JPMorgan Chase Bank, N.A.
(“JPMorgan”) and Morgan Stanley, as Co-Syndication Agents, JPMorgan, as Issuing
Bank, GSLP, as Administrative Agent and Collateral Agent, and the other Agents
party thereto.

Pursuant to Section 2.9 of the Credit Agreement, Borrower desires to convert or
to continue the following Loans, each such conversion and/or continuation to be
effective as of [            ], 20[  ]:

Revolving Loans:

 

$[    ,    ,    ]   

Eurodollar Rate Loans to be continued with Interest Period of [    ] month(s)

$[    ,    ,    ]   

Base Rate Loans to be converted to Eurodollar Rate Loans with Interest Period of
[    ] month(s)

$[    ,    ,    ]   

Eurodollar Rate Loans to be converted to Base Rate Loans

Tranche A Term Loans:

 

$[    ,    ,    ]   

Eurodollar Rate Loans to be continued with Interest Period of [    ] month(s)

$[    ,    ,    ]   

Base Rate Loans to be converted to Eurodollar Rate Loans with Interest Period of
[    ] month(s)

$[    ,    ,    ]   

Eurodollar Rate Loans to be converted to Base Rate Loans

Tranche B Term Loans:

 

$[    ,    ,    ]   

Eurodollar Rate Loans to be continued with Interest Period of [    ] month(s)

$[    ,    ,    ]   

Base Rate Loans to be converted to Eurodollar Rate Loans with Interest Period of
[    ] month(s)

$[    ,    ,    ]   

Eurodollar Rate Loans to be converted to Base Rate Loans

 

EXHIBIT A-2-1

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

Borrower hereby certifies that as of the date hereof, no event has occurred and
is continuing or would result from the consummation of the conversion and/or
continuation contemplated hereby that would constitute an Event of Default or a
Default.

 

Date: [            ], 20[    ]     VALEANT PHARMACEUTICALS INTERNATIONAL, INC.  
  By:  

 

      Name:       Title:

 

 

EXHIBIT A-2-2

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

EXHIBIT B-1 TO

THIRD AMENDED AND RESTATED CREDIT AND GUARANTY AGREEMENT

REVOLVING LOAN NOTE

 

[            ], 20[    ]   New York, New York

For value received, Valeant Pharmaceuticals International, Inc., a corporation
continued under the federal laws of Canada (“Borrower”), promises to pay [NAME
OF LENDER] (“Payee”) or its registered assigns, on or before April 20, 2016 the
lesser of (a) $[    ,    ,    ] and (b) the unpaid principal amount of all
advances made by Payee to Borrower as Revolving Loans under the Credit Agreement
referred to below.

Borrower also promises to pay interest on the unpaid principal amount hereof,
from the date hereof until paid in full, at the rates and at the times which
shall be determined in accordance with the provisions of that certain Third
Amended and Restated Credit and Guaranty Agreement, dated as of February 13,
2012 (as it may be amended, restated, replaced, supplemented or otherwise
modified from time to time, the “Credit Agreement”; the terms defined therein
and not otherwise defined herein being used herein as therein defined), among
Borrower, certain Subsidiaries of Borrower, as Guarantors, the Lenders party
thereto from time to time, Goldman Sachs Lending Partners LLC (“GSLP”), J.P.
Morgan Securities LLC and Morgan Stanley Senior Funding, Inc. (“Morgan
Stanley”), as Joint Lead Arrangers and Joint Bookrunners, JPMorgan Chase Bank,
N.A. (“JPMorgan”) and Morgan Stanley, as Co-Syndication Agents, JPMorgan, as
Issuing Bank, GSLP, as Administrative Agent and Collateral Agent, and the other
Agents party thereto.

This Note is one of the “Revolving Loan Notes” referred to in the Credit
Agreement and is issued pursuant to and entitled to the benefits of the Credit
Agreement, to which reference is hereby made for a more complete statement of
the terms and conditions under which the Loans evidenced hereby were made and
are to be repaid.

All payments of principal and interest in respect of this Note shall be made in
lawful money of the United States of America in same day funds at the Principal
Office of Administrative Agent or at such other place as shall be designated in
writing for such purpose in accordance with the terms of the Credit Agreement.
Unless and until an Assignment Agreement effecting the assignment or transfer of
the obligations evidenced hereby shall have been accepted by Administrative
Agent and recorded in the Register, Borrower, each Agent and Lenders shall be
entitled to deem and treat Payee as the owner and holder of this Note and the
obligations evidenced hereby. Payee hereby agrees, by its acceptance hereof,
that before disposing of this Note or any part hereof it will make a notation
hereon of all principal payments previously made hereunder and of the date to
which interest hereon has been paid; provided that, the failure to make a
notation of any payment made on this Note shall not limit or otherwise affect
the obligations of Borrower hereunder with respect to payments of principal of
or interest on this Note.

This Note is subject to mandatory prepayment and to prepayment at the option of
Borrower, each as provided in, and subject to the terms of, the Credit
Agreement.

THIS NOTE AND THE RIGHTS AND OBLIGATIONS OF BORROWER AND PAYEE HEREUNDER SHALL
BE GOVERNED BY, AND SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE LAWS
OF THE STATE OF NEW YORK.

 

EXHIBIT B-1-1

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

Upon the occurrence of an Event of Default, the unpaid balance of the principal
amount of this Note, together with all accrued and unpaid interest thereon, may
become, or may be declared to be, due and payable in the manner, upon the
conditions and with the effect provided in the Credit Agreement.

The terms of this Note are subject to amendment only in the manner provided in
the Credit Agreement.

Borrower promises to pay all costs and expenses, including reasonable attorneys’
fees, all as provided in, and subject to the terms of, the Credit Agreement,
incurred in the collection and enforcement of this Note. Borrower and any
endorsers of this Note hereby consent to renewals and extensions of time at or
after the maturity hereof, without notice, and hereby waive diligence,
presentment, protest, demand notice of every kind and, to the full extent
permitted by law, the right to plead any statute of limitations as a defense to
any demand hereunder.

[Remainder of page intentionally left blank]

 

EXHIBIT B-1-2

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

IN WITNESS WHEREOF, Borrower has caused this Note to be duly executed and
delivered by its officer thereunto duly authorized as of the date and at the
place first written above.

 

VALEANT PHARMACEUTICALS INTERNATIONAL, INC. By:  

 

  Name:   Title:

 

EXHIBIT B-1-3

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

TRANSACTIONS ON

REVOLVING LOAN NOTE

 

Date

  

Amount of Loan

Made This Date

  

Amount of Principal

Paid This Date

  

Outstanding Principal

Balance This Date

  

Notation

Made By

           

 

EXHIBIT B-1-4

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

EXHIBIT B-2 TO

THIRD AMENDED AND RESTATED CREDIT AND GUARANTY AGREEMENT

SWING LINE NOTE

 

[            ], 20[  ]   New York, New York

For value received, Valeant Pharmaceuticals International, Inc., a corporation
continued under the federal laws of Canada (“Borrower”), promises to pay to
Goldman Sachs Lending Partners LLC, as Swing Line Lender (“Payee”), on or before
[            ], 20[  ], the lesser of (a) $[    ,    ,    ] and (b) the unpaid
principal amount of all advances made by Payee to Borrower as Swing Line Loans
under the Credit Agreement referred to below.

Borrower also promises to pay interest on the unpaid principal amount hereof,
from the date hereof until paid in full, at the rates and at the times which
shall be determined in accordance with the provisions of that certain Third
Amended and Restated Credit and Guaranty Agreement, dated as of February 13,
2012 (as it may be amended, restated, replaced, supplemented or otherwise
modified from time to time, the “Credit Agreement”; the terms defined therein
and not otherwise defined herein being used herein as therein defined), among
Borrower, certain Subsidiaries of Borrower, as Guarantors, the Lenders party
thereto from time to time, Goldman Sachs Lending Partners LLC (“GSLP”), J.P.
Morgan Securities LLC and Morgan Stanley Senior Funding, Inc. (“Morgan
Stanley”), as Joint Lead Arrangers and Joint Bookrunners, JPMorgan Chase Bank,
N.A. (“JPMorgan”) and Morgan Stanley, as Co-Syndication Agents, JPMorgan, as
Issuing Bank, GSLP, as Administrative Agent and Collateral Agent, and the other
Agents party thereto.

This Note is the “Swing Line Note” referred to in the Credit Agreement and is
issued pursuant to and entitled to the benefits of the Credit Agreement, to
which reference is hereby made for a more complete statement of the terms and
conditions under which the Swing Line Loans evidenced hereby were made and are
to be repaid.

All payments of principal and interest in respect of this Note shall be made in
lawful money of the United States of America in same day funds at the Principal
Office of Swing Line Lender or at such other place as shall be designated in
writing for such purpose in accordance with the terms of the Credit Agreement.

This Note is subject to mandatory prepayment and to prepayment at the option of
Borrower, each as provided in, and subject to the terms of, the Credit
Agreement.

THIS NOTE AND THE RIGHTS AND OBLIGATIONS OF BORROWER AND PAYEE HEREUNDER SHALL
BE GOVERNED BY, AND SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE LAWS
OF THE STATE OF NEW YORK.

Upon the occurrence of an Event of Default, the unpaid balance of the principal
amount of this Note, together with all accrued and unpaid interest thereon, may
become, or may be declared to be, due and payable in the manner, upon the
conditions and with the effect provided in the Credit Agreement.

The terms of this Note are subject to amendment only in the manner provided in
the Credit Agreement.

 

EXHIBIT B-2-1

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

Borrower promises to pay all costs and expenses, including reasonable attorneys’
fees, all as provided in, and subject to the terms of, the Credit Agreement,
incurred in the collection and enforcement of this Note. Borrower and any
endorsers of this Note hereby consent to renewals and extensions of time at or
after the maturity hereof, without notice, and hereby waive diligence,
presentment, protest, demand notice of every kind and, to the full extent
permitted by law, the right to plead any statute of limitations as a defense to
any demand hereunder.

[Remainder of page intentionally left blank]

 

EXHIBIT B-2-2

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

IN WITNESS WHEREOF, Borrower has caused this Note to be duly executed and
delivered by its officer thereunto duly authorized as of the date and at the
place first written above.

 

VALEANT PHARMACEUTICALS INTERNATIONAL, INC. By:  

 

  Name:   Title:

 

EXHIBIT B-2-3

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

TRANSACTIONS ON

SWING LINE NOTE

 

Date

  

Amount of Loan

Made This Date

  

Amount of Principal

Paid This Date

  

Outstanding Principal

Balance This Date

  

Notation

Made By

           

 

EXHIBIT B-2-4

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

EXHIBIT B-3 TO

THIRD AMENDED AND RESTATED CREDIT AND GUARANTY AGREEMENT

TRANCHE A TERM LOAN NOTE

 

[            ], 20[  ]   New York, New York

For value received, Valeant Pharmaceuticals International, Inc., a corporation
continued under the federal laws of Canada (“Borrower”), promises to pay [NAME
OF LENDER] (“Payee”) or its registered assigns the principal amount of
$[    ,    ,    ] in the installments referred to below.

Borrower also promises to pay interest on the unpaid principal amount hereof,
from the date hereof until paid in full, at the rates and at the times which
shall be determined in accordance with the provisions of that certain Third
Amended and Restated Credit and Guaranty Agreement, dated as of February 13,
2012 (as it may be amended, restated, replaced, supplemented or otherwise
modified from time to time, the “Credit Agreement”; the terms defined therein
and not otherwise defined herein being used herein as therein defined), among
Borrower, certain Subsidiaries of Borrower, as Guarantors, the Lenders party
thereto from time to time, Goldman Sachs Lending Partners LLC (“GSLP”), J.P.
Morgan Securities LLC and Morgan Stanley Senior Funding, Inc. (“Morgan
Stanley”), as Joint Lead Arrangers and Joint Bookrunners, JPMorgan Chase Bank,
N.A. (“JPMorgan”) and Morgan Stanley, as Co-Syndication Agents, JPMorgan, as
Issuing Bank, GSLP, as Administrative Agent and Collateral Agent, and the other
Agents party thereto.

Borrower shall make scheduled principal payments on this Note as set forth in
Section 2.12 of the Credit Agreement.

This Note is one of the “Tranche A Term Loan Notes” referred to in the Credit
Agreement and is issued pursuant to and entitled to the benefits of the Credit
Agreement, to which reference is hereby made for a more complete statement of
the terms and conditions under which the Tranche A Term Loan evidenced hereby
was made and is to be repaid.

All payments of principal and interest in respect of this Note shall be made in
lawful money of the United States of America in same day funds at the Principal
Office of Administrative Agent or at such other place as shall be designated in
writing for such purpose in accordance with the terms of the Credit Agreement.
Unless and until an Assignment Agreement effecting the assignment or transfer of
the obligations evidenced hereby shall have been accepted by Administrative
Agent and recorded in the Register, Borrower, each Agent and Lenders shall be
entitled to deem and treat Payee as the owner and holder of this Note and the
obligations evidenced hereby. Payee hereby agrees, by its acceptance hereof,
that before disposing of this Note or any part hereof it will make a notation
hereon of all principal payments previously made hereunder and of the date to
which interest hereon has been paid; provided that, the failure to make a
notation of any payment made on this Note shall not limit or otherwise affect
the obligations of Borrower hereunder with respect to payments of principal of
or interest on this Note.

This Note is subject to mandatory prepayment and to prepayment at the option of
Borrower, each as provided in, and subject to the terms of, the Credit
Agreement.

 

EXHIBIT B-3-1

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

THIS NOTE AND THE RIGHTS AND OBLIGATIONS OF BORROWER AND PAYEE HEREUNDER SHALL
BE GOVERNED BY, AND SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE LAWS
OF THE STATE OF NEW YORK.

Upon the occurrence of an Event of Default, the unpaid balance of the principal
amount of this Note, together with all accrued and unpaid interest thereon, may
become, or may be declared to be, due and payable in the manner, upon the
conditions and with the effect provided in the Credit Agreement.

The terms of this Note are subject to amendment only in the manner provided in
the Credit Agreement.

Borrower promises to pay all costs and expenses, including reasonable attorneys’
fees, all as provided in, and subject to the terms of, the Credit Agreement,
incurred in the collection and enforcement of this Note. Borrower and any
endorsers of this Note hereby consent to renewals and extensions of time at or
after the maturity hereof, without notice, and hereby waive diligence,
presentment, protest, demand notice of every kind and, to the full extent
permitted by law, the right to plead any statute of limitations as a defense to
any demand hereunder.

[Remainder of page intentionally left blank]

 

EXHIBIT B-3-2

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

IN WITNESS WHEREOF, Borrower has caused this Note to be duly executed and
delivered by its officer thereunto duly authorized as of the date and at the
place first written above.

 

VALEANT PHARMACEUTICALS INTERNATIONAL, INC. By:  

 

  Name:   Title:

 

EXHIBIT B-3-3

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

EXHIBIT B-4 TO

THIRD AMENDED AND RESTATED CREDIT AND GUARANTY AGREEMENT

TRANCHE B TERM LOAN NOTE

 

[            ], 20[  ]   New York, New York

For value received, Valeant Pharmaceuticals International, Inc., a corporation
continued under the federal laws of Canada (“Borrower”), promises to pay [NAME
OF LENDER] (“Payee”) or its registered assigns the principal amount of
$[    ,    ,    ] in the installments referred to below.

Borrower also promises to pay interest on the unpaid principal amount hereof,
from the date hereof until paid in full, at the rates and at the times which
shall be determined in accordance with the provisions of that certain Third
Amended and Restated Credit and Guaranty Agreement, dated as of February 13,
2012 (as it may be amended, restated, replaced, supplemented or otherwise
modified from time to time, the “Credit Agreement”; the terms defined therein
and not otherwise defined herein being used herein as therein defined), among
Borrower, certain Subsidiaries of Borrower, as Guarantors, the Lenders party
thereto from time to time, Goldman Sachs Lending Partners LLC (“GSLP”), J.P.
Morgan Securities LLC and Morgan Stanley Senior Funding, Inc. (“Morgan
Stanley”), as Joint Lead Arrangers and Joint Bookrunners, JPMorgan Chase Bank,
N.A. (“JPMorgan”) and Morgan Stanley, as Co-Syndication Agents, JPMorgan, as
Issuing Bank, GSLP, as Administrative Agent and Collateral Agent, and the other
Agents party thereto.

Borrower shall make scheduled principal payments on this Note as set forth in
Section 2.12 of the Credit Agreement.

This Note is one of the “Tranche B Term Loan Notes” referred to in the Credit
Agreement and is issued pursuant to and entitled to the benefits of the Credit
Agreement, to which reference is hereby made for a more complete statement of
the terms and conditions under which the Tranche B Term Loan evidenced hereby
was made and is to be repaid.

All payments of principal and interest in respect of this Note shall be made in
lawful money of the United States of America in same day funds at the Principal
Office of Administrative Agent or at such other place as shall be designated in
writing for such purpose in accordance with the terms of the Credit Agreement.
Unless and until an Assignment Agreement effecting the assignment or transfer of
the obligations evidenced hereby shall have been accepted by Administrative
Agent and recorded in the Register, Borrower, each Agent and Lenders shall be
entitled to deem and treat Payee as the owner and holder of this Note and the
obligations evidenced hereby. Payee hereby agrees, by its acceptance hereof,
that before disposing of this Note or any part hereof it will make a notation
hereon of all principal payments previously made hereunder and of the date to
which interest hereon has been paid; provided that, the failure to make a
notation of any payment made on this Note shall not limit or otherwise affect
the obligations of Borrower hereunder with respect to payments of principal of
or interest on this Note.

This Note is subject to mandatory prepayment and to prepayment at the option of
Borrower, each as provided in, and subject to the terms of, the Credit
Agreement.

THIS NOTE AND THE RIGHTS AND OBLIGATIONS OF BORROWER AND PAYEE HEREUNDER SHALL
BE GOVERNED BY, AND SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE LAWS
OF THE STATE OF NEW YORK.

 

EXHIBIT B-4-1

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

Upon the occurrence of an Event of Default, the unpaid balance of the principal
amount of this Note, together with all accrued and unpaid interest thereon, may
become, or may be declared to be, due and payable in the manner, upon the
conditions and with the effect provided in the Credit Agreement.

The terms of this Note are subject to amendment only in the manner provided in
the Credit Agreement.

Borrower promises to pay all costs and expenses, including reasonable attorneys’
fees, all as provided in, and subject to the terms of, the Credit Agreement,
incurred in the collection and enforcement of this Note. Borrower and any
endorsers of this Note hereby consent to renewals and extensions of time at or
after the maturity hereof, without notice, and hereby waive diligence,
presentment, protest, demand notice of every kind and, to the full extent
permitted by law, the right to plead any statute of limitations as a defense to
any demand hereunder.

[Remainder of page intentionally left blank]

 

EXHIBIT B-4-2

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

IN WITNESS WHEREOF, Borrower has caused this Note to be duly executed and
delivered by its officer thereunto duly authorized as of the date and at the
place first written above.

 

VALEANT PHARMACEUTICALS INTERNATIONAL, INC. By:  

 

  Name:   Title:

 

EXHIBIT B-4-3

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

EXHIBIT C TO

THIRD AMENDED AND RESTATED CREDIT AND GUARANTY AGREEMENT

COMPLIANCE CERTIFICATE

THE UNDERSIGNED HEREBY CERTIFIES AS FOLLOWS:

1. I am the Chief Financial Officer of Valeant Pharmaceuticals International,
Inc., a corporation continued under the federal laws of Canada (“Borrower”).

2. I have reviewed the terms of that certain Third Amended and Restated Credit
and Guaranty Agreement, dated as of February 13, 2012 (as it may be amended,
restated, replaced, supplemented or otherwise modified from time to time, the
“Credit Agreement”; the terms defined therein and not otherwise defined herein
being used herein as therein defined), among Borrower, certain Subsidiaries of
Borrower, as Guarantors, the Lenders party thereto from time to time, Goldman
Sachs Lending Partners LLC (“GSLP”), J.P. Morgan Securities LLC and Morgan
Stanley Senior Funding, Inc. (“Morgan Stanley”), as Joint Lead Arrangers and
Joint Bookrunners, JPMorgan Chase Bank, N.A. (“JPMorgan”) and Morgan Stanley, as
Co-Syndication Agents, JPMorgan, as Issuing Bank, GSLP, as Administrative Agent
and Collateral Agent, and the other Agents party thereto, and I have made, or
have caused to be made under my supervision, a review in reasonable detail of
the transactions and condition of Borrower and its Subsidiaries during the
accounting period covered by the attached financial statements.

3. The examination described in paragraph 2 above did not disclose, and I have
no knowledge of, the existence of any condition or event which constitutes an
Event of Default or Default during or at the end of the accounting period
covered by the attached financial statements or as of the date of this
Certificate, except as set forth in a separate attachment, if any, to this
Certificate, describing in detail, the nature of the condition or event, the
period during which it has existed and the action which Borrower and its
Subsidiaries have taken, are taking, or propose to take with respect to each
such condition or event.

The foregoing certifications, together with the computations set forth in the
Annex A hereto and the financial statements delivered with this Certificate in
support hereof, are made and delivered [            ], 20[  ] pursuant to
Section 5.1(c) of the Credit Agreement.

This Certificate is being signed by the undersigned in [his] [her] capacity as
the Chief Financial Officer of the Borrower and not in [his] [her] individual
capacity.

 

VALEANT PHARMACEUTICALS INTERNATIONAL, INC. By:  

 

  Name:   Title: Chief Financial Officer

 

EXHIBIT C-1

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

ANNEX A TO

COMPLIANCE CERTIFICATE

FOR THE FISCAL [QUARTER] [YEAR] ENDING [            ], 20[  ].

 

1. Consolidated Adjusted EBITDA: (i) - (ii) =

   $ [    ,    ,     ]   

(i)

  (a) Consolidated Net Income:    $ [    ,    ,     ]      (b) Consolidated
Interest Expense:    $ [    ,    ,     ]      (c) provisions for taxes based on
income:    $ [    ,    ,     ]      (d) total depreciation expense:    $
[    ,    ,     ]      (e) total amortization expense:    $ [    ,    ,     ]   
  (f) fees and expenses incurred in connection with the Transactions or the 2010
Transactions:    $ [    ,    ,     ]      (g) non-cash non-recurring expenses or
charges:    $ [    ,    ,     ]      (h) (i) restructuring charges (which, for
the avoidance of doubt, shall include retention, severance, systems
establishment costs, excess pension charges, contract termination costs and
costs to consolidate facilities and relocate employees) not to exceed
$100,000,000 in any twelve-month period (other than such charges contemplated by
the following clause (ii)) and (ii) restructuring charges (which, for the
avoidance of doubt, shall include retention, severance, system establishment
costs, excess pension charges, contract termination costs and costs to
consolidate facilities and relocate employees and charges in connection with the
termination or settlement of employee stock options, restricted stock units and
performance stock units, in each case in existence as of the Original Closing
Date) in connection with the Sanitas Acquisition, the Transactions or the 2010
Transactions:    $ [    ,    ,     ]      (i) any extraordinary gain or loss and
any expense or charge attributable to the disposition of discontinued
operations:    $ [    ,    ,     ]      (j) fees and expenses in connection with
any proposed or actual issuance of any Indebtedness or Equity Interests, or any
proposed or actual acquisitions, investments, asset sales or divestitures
permitted hereunder, in an aggregate amount not to exceed $75,000,000 during the
term of this Agreement:    $ [    ,    ,     ]      (k) other non-Cash charges
(including impairment charges and other write offs of intangible assets and
goodwill but excluding any such non-Cash charge to the extent that it represents
an accrual or reserve for potential Cash items in any future period or
amortization of a pre-paid Cash charge that was paid in a prior period):    $
[    ,    ,     ] 

 

EXHIBIT C-A-1

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

    (l) the amount of costs savings and synergies projected by the Borrower in
good faith to be realized on or prior to September 30, 2012 as a result of the
2010 Transactions, net of the amount of actual cost savings and synergies
realized during such period as a result of the 2010 Transactions; provided that
(i) such cost savings and synergies are (A) reasonably identifiable, (B)
factually supportable and (C) certified by the chief financial officer of
Borrower and (ii) the aggregate amount of such cost savings and synergies
increasing Consolidated Adjusted EBITDA pursuant to this clause (l) shall not
exceed $140,000,000:    $ [    ,    ,     ]   

(ii)

  other non-Cash gains increasing Consolidated Net Income for such period
(excluding any such non-Cash gain to the extent it represents the reversal of an
accrual or reserve for potential Cash items in any prior period and any such
non-Cash gain relating to Cash received in a prior period (or to be received in
a future period)):    $ [    ,    ,     ] 

2. Consolidated Interest Expense:

   $ [    ,    ,     ] 

3. Consolidated Excess Cash Flow: (i) - (ii) =

   $ [    ,    ,     ]   

(i)

 

(a) Consolidated Net Income:

   $ [    ,    ,     ]      (b) to the extent reducing Consolidated Net Income,
the sum, without duplication, of amounts for non Cash charges reducing
Consolidated Net Income (including for depreciation and amortization and
impairment charges and other write offs of intangible assets and goodwill but
excluding any such non Cash charge to the extent that it represents an accrual
or reserve for a potential Cash charge in any future period or amortization of a
prepaid Cash charge that was paid in a prior period):    $ [    ,    ,     ]   
 

(c) Consolidated Working Capital Adjustment:

   $ [    ,    ,     ]   

(ii)

  (a) the amounts for such period paid from Internally Generated Cash of
(1) scheduled repayments of Indebtedness for borrowed money (excluding
repayments of Revolving Loans or Swing Line Loans except to the extent the
Revolving Commitments are permanently reduced in connection with such
repayments) and scheduled repayments of obligations under Capital Leases
(excluding any interest expense portion thereof), and (2) Consolidated Capital
Expenditures:    $ [    ,    ,     ]      (b) other non Cash gains increasing
Consolidated Net Income for such period (excluding any such non Cash gain to the
extent it represents the reversal of an accrual or reserve for a potential Cash
charge in any prior period):    $ [    ,    ,     ] 

 

EXHIBIT C-A-2

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

    (c) the aggregate amount of Restricted Junior Payments made in Cash by
Borrower or any of its Subsidiaries during such period pursuant to clauses (e)
and (g) of Section 6.4 of the Credit Agreement using Internally Generated Cash,
except to the extent that such Restricted Junior Payments are made to fund
expenditures that reduce Consolidated Net Income:      $[    ,    ,    ]       
(d) the aggregate amount of Investments made in cash by Borrower or any of its
Subsidiaries during such period pursuant to clauses (g), (h), (i), (j), (k) and
(l) of Section 6.6 of the Credit Agreement (other than any intercompany
Investments) using Internally Generated Cash:      $[    ,    ,    ]    4.
Consolidated Net Income:1 (i) - (ii) =      $[    ,    ,    ]      (i)   the net
income (or loss) of Borrower and its Subsidiaries on a consolidated basis for
such period taken as a single accounting period determined in conformity with
GAAP:      $[    ,    ,    ]      (ii)   (a)    the income (or loss) of any
Person (other than a Subsidiary of Borrower) in which any other Person (other
than Borrower or any of its Subsidiaries) has a joint interest, except to the
extent of the amount of dividends or other distributions actually paid to
Borrower or any of its Subsidiaries by such Person during such period:     
$[    ,    ,    ]        (b)    the income (or loss) of any Person accrued prior
to the date it becomes a Subsidiary of Borrower or is merged into or
consolidated with Borrower or any of its Subsidiaries or the income (or loss) in
respect of the assets of any Person accrued prior to the date such assets are
acquired by Borrower or any of its Subsidiaries:      $[    ,    ,    ]   

 

1  Without duplication of amounts included in clause (ii)(a), the net income of
a Specified Joint Venture for such period shall be included in the calculation
of Consolidated Net Income in proportion to Borrower and its Subsidiaries’
Equity Interests in such Specified Joint Venture (provided that the net income
of all Specified Joint Ventures included pursuant to this proviso for any period
shall not exceed 10% of the aggregate Consolidated Net Income for Borrower and
its Subsidiaries for such period).

 

EXHIBIT C-A-3

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

    (c)    the income of any Subsidiary of Borrower (other than any such
Subsidiary that is a Credit Party) during such period to the extent that the
declaration or payment of dividends or similar distributions by that Subsidiary
of that income is not at the time permitted by operation of the terms of its
charter or any agreement, instrument, judgment, decree, order, statute, rule or
governmental regulation applicable to that Subsidiary:      $[    ,    ,    ]   
    (d)    any after tax gains or losses attributable to Asset Sales and
casualty or condemnation events (of the type described in the definition of “Net
Insurance/Condemnation Proceeds”) or returned surplus assets of any Pension
Plan, in each case accrued during such period:      $[    ,    ,    ]        (e)
   to the extent not included in clauses (ii)(a) through (d) above, any net
extraordinary gains or net extraordinary losses accrued during such period:     
$[    ,    ,    ]        (f)    the cumulative effect of a change in accounting
principles:      $[    ,    ,    ]        (g)    solely for purposes of
calculating the CNI Growth Amount for such period, amortization or depreciation
expense incurred during such period with respect to assets that are used or
useful in the business or lines of business in which Borrower and/or its
Subsidiaries are engaged as of the Third Restatement Date or similar or related
or ancillary businesses:      $[    ,    ,    ]    5. Consolidated Total Debt:
     $[    ,    ,    ]    6. Consolidated Working Capital: (i) - (ii) =     
$[    ,    ,    ]      (i)   Consolidated Current Assets:      $[    ,    ,    ]
     (ii)   Consolidated Current Liabilities:      $[    ,    ,    ]    7.
Consolidated Working Capital Adjustment: (i) - (ii) =      $[    ,    ,    ]   
  (i)   Consolidated Working Capital as of the beginning of such period:     
$[    ,    ,    ]      (ii)   Consolidated Working Capital as of the end of such
period:      $[    ,    ,    ]    8. Interest Coverage Ratio: (i)/(ii) =     
(i)   Consolidated Adjusted EBITDA for the four-Fiscal Quarter Period then
ended:      $[    ,    ,    ]      (ii)   Consolidated Interest Expense for such
four-Fiscal Quarter Period:      $[    ,    ,    ]   

 

EXHIBIT C-A-4

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

          Actual:       .    :1.00              Required:      3.00:1.00    9.
Secured Leverage Ratio: (i)/(ii) =      (i)   Consolidated Secured Indebtedness:
     $[    ,    ,    ]      (ii)   Consolidated Adjusted EBITDA for the
four-Fiscal Quarter period then ended:      $[    ,    ,    ]             
Actual:       .    :1.00              Required (through and including the Fiscal
Quarter ending December 31, 2011):      1.75:1.00              Required
(beginning with the Fiscal Quarter ending March 31, 2012):      2.50:1.00    10.
Leverage Ratio: (i)/(ii) =      (i)   Consolidated Total Debt:     
$[    ,    ,    ]      (ii)   Consolidated Adjusted EBITDA for the four-Fiscal
Quarter period then ended:      $[    ,    ,    ]              Actual:     
 .    :1.00              Required:       .    :1.00   

 

EXHIBIT C-A-5

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

EXHIBIT D TO

THIRD AMENDED AND RESTATED CREDIT AND GUARANTY AGREEMENT

ASSIGNMENT AND ASSUMPTION AGREEMENT

This Assignment and Assumption Agreement (this “Assignment”) is dated as of the
Effective Date set forth below and is entered into by and between [Insert name
of Assignor] (the “Assignor”) and [Insert name of Assignee] (the “Assignee”).
Capitalized terms used but not defined herein shall have the meanings given to
them in the Credit Agreement identified below (as it may be amended, restated,
replaced, supplemented or otherwise modified from time to time, the “Credit
Agreement”; the terms defined therein and not otherwise defined herein being
used herein as therein defined), receipt of a copy of which is hereby
acknowledged by the Assignee. The Standard Terms and Conditions set forth in
Annex 1 attached hereto are hereby agreed to and incorporated herein by
reference and made a part of this Assignment as if set forth herein in full.

For an agreed consideration, the Assignor hereby irrevocably sells and assigns
to the Assignee, and the Assignee hereby irrevocably purchases and assumes from
the Assignor, subject to and in accordance with the Standard Terms and
Conditions and the Credit Agreement, as of the Effective Date inserted by the
Administrative Agent as contemplated below, the interest in and to all of the
Assignor’s rights and obligations under the Credit Agreement and any other
documents or instruments delivered pursuant thereto (other than the Australian
Collateral) that represents the amount and percentage interest identified below
of all of the Assignor’s outstanding rights and obligations under the respective
facilities identified below (including, to the extent included in any such
facilities, letters or credit and swingline loans) (the “Assigned Interest”).
Such sale and assignment is without recourse to the Assignor and, except as
expressly provided in this Assignment and the Credit Agreement, without
representation or warranty by the Assignor.

 

1.

 

Assignor:

 

 

 

2.

 

Assignee:

 

 

 

3.

 

Borrower:

  VALEANT PHARMACEUTICALS INTERNATIONAL, INC. (“Borrower”)

4.

 

Administrative Agent:

  GOLDMAN SACHS LENDING PARTNERS LLC (“GSLP”), as Administrative Agent under the
Credit Agreement

5.

 

Credit Agreement:

  Third Amended and Restated Credit and Guaranty Agreement, dated as of February
13, 2012 (as it may be amended, restated, replaced, supplemented or otherwise
modified from time to time), among Valeant Pharmaceuticals International, Inc.,
a corporation continued under the federal laws of Canada (“Borrower”), certain
Subsidiaries of Borrower, as Guarantors, the Lenders party thereto from time to
time, GSLP, J.P. Morgan Securities LLC and Morgan Stanley Senior Funding, Inc.
(“Morgan Stanley”), as Joint Lead Arrangers and Joint Bookrunners, JPMorgan
Chase Bank, N.A. (“JPMorgan”) and Morgan Stanley, as Co-Syndication Agents,
JPMorgan, as Issuing Bank, GSLP, as Administrative Agent and Collateral Agent,
and the other Agents party thereto

 

EXHIBIT D-1

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

6. Assigned Interest:

 

Facility Assigned

   Aggregate Amount of
Commitment/Loans
for all Lenders      Amount of
Commitment/Loans
Assigned  

Revolving Commitments/Loans

   $                $               

 

 

    

 

 

 

Initial Draw Tranche A Term Loans

   $                $               

 

 

    

 

 

 

Delayed Draw Term Commitments/Loans

   $                $               

 

 

    

 

 

 

Tranche B Term Loans

   $                $               

 

 

    

 

 

 

Effective Date:             , 20    

 

7. Notice and Wire Instructions:

 

[NAME OF ASSIGNOR]     [NAME OF ASSIGNEE] Notices:       Notices:    

 

     

 

 

 

     

 

 

 

     

 

  Attention:       Attention:   Telecopier:       Telecopier: with a copy to:  
  with a copy to:  

 

     

 

 

 

     

 

 

 

     

 

  Attention:       Attention:   Telecopier:       Telecopier: Wire Instructions:
    Wire Instructions:

 

EXHIBIT D-2

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

The terms set forth in this Assignment are hereby agreed to:

 

ASSIGNOR   [NAME OF ASSIGNOR]

By:

 

 

  Title: ASSIGNEE   [NAME OF ASSIGNEE]

By:

 

 

  Title:

 

Consented to and Accepted: GOLDMAN SACHS LENDING PARTNERS LLC, as
  Administrative Agent1 By:  

 

  Title: Consented to: JPMORGAN CHASE BANK, N.A., as   Issuing Bank2 By:  

 

  Title: Consented to: VALEANT PHARMACEUTICALS INTERNATIONAL, INC.3 By:  

 

  Title:

 

1 

If required pursuant to Section 10.6(c)(ii) of the Credit Agreement.

2 

If required pursuant to Section 10.6(c)(ii) of the Credit Agreement.

3 

If required pursuant to Section 10.6(c)(ii) of the Credit Agreement.

 

EXHIBIT D-3

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

ANNEX 1

STANDARD TERMS AND CONDITIONS FOR ASSIGNMENT

AND ASSUMPTION AGREEMENT

 

1. Representations and Warranties.

 

  1.1 Assignor. The Assignor (a) represents and warrants that (i) it is the
legal and beneficial owner of the Assigned Interest, (ii) the Assigned Interest
is free and clear of any lien, encumbrance or other adverse claim and (iii) it
has full power and authority, and has taken all action necessary, to execute and
deliver this Assignment and to consummate the transactions contemplated hereby;
and (b) assumes no responsibility with respect to (i) any statements, warranties
or representations made in or in connection with any Credit Document, (ii) the
execution, legality, validity, enforceability, genuineness, sufficiency or value
of the Credit Agreement or any other instrument or document delivered pursuant
thereto, other than this Assignment (herein collectively the “Credit
Documents”), or any collateral thereunder, (iii) the financial condition of
Borrower, any of its Subsidiaries or Affiliates or any other Person obligated in
respect of any Credit Document or (iv) the performance or observance by
Borrower, any of its Subsidiaries or Affiliates or any other Person of any of
their respective obligations under any Credit Document.

 

  1.2 Assignee. The Assignee (a) represents and warrants that (i) it has full
power and authority, and has taken all action necessary, to execute and deliver
this Assignment and to consummate the transactions contemplated hereby and to
become a Lender under the Credit Agreement, (ii) it meets all requirements of an
Eligible Assignee under the Credit Agreement, (iii) from and after the Effective
Date, it shall be bound by the provisions of the Credit Agreement and, to the
extent of the Assigned Interest, shall have the obligations of a Lender
thereunder, (iv) it has received a copy of the Credit Agreement and such other
documents and information as it has deemed appropriate to make its own credit
analysis and decision to enter into this Assignment and to purchase the Assigned
Interest on the basis of which it has made such analysis and decision, and
(v) if it is a Non-U.S. Lender, attached to the Assignment is any documentation
required to be delivered by it pursuant to the terms of the Credit Agreement,
duly completed and executed by the Assignee; and (b) agrees that (i) it will,
independently and without reliance on the Administrative Agent, the Assignor or
any other Lender, and based on such documents and information as it shall deem
appropriate at that time, continue to make its own credit decisions in taking or
not taking action under the Credit Documents, and (ii) it will perform in
accordance with their terms all of the obligations which by the terms of the
Credit Documents are required to be performed by it as a Lender.

 

2. Payments. All payments with respect to the Assigned Interests shall be made
on the Effective Date as follows:

 

  2.1 From and after the Effective Date, the Administrative Agent shall make all
payments in respect of the Assigned Interest (including payments of principal,
interest, fees and other amounts) to the Assignor for amounts that have accrued
to but excluding the Effective Date and to the Assignee for amounts that have
accrued from and after the Effective Date.

 

EXHIBIT D-4

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

3. General Provisions. This Assignment shall be binding upon, and inure to the
benefit of, the parties hereto and their respective successors and assigns. This
Assignment may be executed in any number of counterparts, which together shall
constitute one instrument. Delivery of an executed counterpart of a signature
page of this Assignment by telecopy or other electronic transmission (such as
.pdf or .tif) shall be effective as delivery of a manually executed counterpart
of this Assignment. This Assignment shall be governed by, and construed in
accordance with, the internal laws of the State of New York without regard to
conflict of laws principles thereof.

[Remainder of page intentionally left blank]

 

EXHIBIT D-5

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

EXHIBIT E TO

THIRD AMENDED AND RESTATED CREDIT AND GUARANTY AGREEMENT

[Reserved]

 

EXHIBIT E-1

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

EXHIBIT F-1 TO

THIRD AMENDED AND RESTATED CREDIT AND GUARANTY AGREEMENT

THIRD RESTATEMENT DATE CERTIFICATE

THE UNDERSIGNED HEREBY CERTIFY AS FOLLOWS:

1. We are, respectively, the [        ] and [        ] of VALEANT
PHARMACEUTICALS INTERNATIONAL, INC., a corporation continued under the federal
laws of Canada (“Borrower”).

2. We have reviewed the terms of Section 3 of the Third Amended and Restated
Credit and Guaranty Agreement, dated as of February 13, 2012 (as it may be
amended, restated, replaced, supplemented or otherwise modified from time to
time, the “Credit Agreement”; the terms defined therein and not otherwise
defined herein being used herein as therein defined), among Borrower, certain
Subsidiaries of Borrower, as Guarantors, the Lenders party thereto from time to
time, Goldman Sachs Lending Partners LLC (“GSLP”), J.P. Morgan Securities LLC
and Morgan Stanley Senior Funding, Inc. (“Morgan Stanley”), as Joint Lead
Arrangers and Joint Bookrunners, JPMorgan Chase Bank, N.A. (“JPMorgan”) and
Morgan Stanley, as Co-Syndication Agents, JPMorgan, as Issuing Bank, GSLP, as
Administrative Agent and Collateral Agent, and the other Agents party thereto,
and the definitions and provisions contained in such Credit Agreement relating
thereto, and in our opinion we have made, or have caused to be made under our
supervision, such examination or investigation as is necessary to enable us to
express an informed opinion as to the matters referred to herein.

3. Based upon our review and examination described in paragraph 2 above and
subject in all cases to the last paragraph of Section 3.1 of the Credit
Agreement, we certify, on behalf of Borrower, that as of the date hereof, the
representations and warranties contained in each of the Credit Documents are
true and correct in all material respects on and as of the Third Restatement
Date to the same extent as though made on and as of that date, except to the
extent such representations and warranties specifically relate to an earlier
date, in which case such representations and warranties are true and correct in
all material respects on and as of such earlier date.

4. Each Credit Party has requested Skadden, Arps, Slate, Meagher & Flom LLP,
U.S. counsel to Borrower, Norton Rose OR LLP, special Canadian counsel to
Borrower, Chancery Chambers, special Barbados counsel to Borrower, and Baker &
McKenzie, special Australian, Luxembourg and Swiss counsel to Borrower to
deliver to Agents and Lenders on the Third Restatement Date favorable written
opinions in form and substance reasonably satisfactory to the Administrative
Agent.

5. Attached hereto as Annex A are true, complete and correct copies of (a) the
Historical Financial Statements and (b) the Projections.

The foregoing certifications are made and delivered as of February 13, 2012.

This Certificate is being signed by the undersigned in their respective
capacities as [        ] and [        ] of the Borrower and not in their
individual capacities.

[Remainder of page intentionally left blank]

 

EXHIBIT F-1-1

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

VALEANT PHARMACEUTICALS INTERNATIONAL, INC.   By:  

 

    Name:     Title: [    ]   By:  

 

    Name:     Title: [    ]

 

EXHIBIT F-1-2

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

EXHIBIT F-2 TO

THIRD AMENDED AND RESTATED CREDIT AND GUARANTY AGREEMENT

SOLVENCY CERTIFICATE

This Solvency Certificate (this “Certificate”) is being delivered pursuant to
Section 3.1(g) of the Third Amended and Restated Credit and Guaranty Agreement,
dated as of February 13, 2012 (as it may be amended, restated, replaced,
supplemented or otherwise modified from time to time, the “Credit Agreement”;
the terms defined therein and not otherwise defined herein being used herein as
therein defined), among Valeant Pharmaceuticals International, Inc., a
corporation continued under the federal laws of Canada (“Borrower”), certain
Subsidiaries of Borrower, as Guarantors, the Lenders party thereto from time to
time, Goldman Sachs Lending Partners LLC (“GSLP”), J.P. Morgan Securities LLC
and Morgan Stanley Senior Funding, Inc. (“Morgan Stanley”), as Joint Lead
Arrangers and Joint Bookrunners, JPMorgan Chase Bank, N.A. (“JPMorgan”) and
Morgan Stanley, as Co-Syndication Agents, JPMorgan, as Issuing Bank, GSLP, as
Administrative Agent and Collateral Agent, and the other Agents party thereto.

[            ] hereby certifies that (i) [he]/[she] is the chief financial
officer of Borrower, (ii) [he]/[she] is knowledgeable of the finances,
accounting, properties, businesses and assets of Borrower and each Credit Party
that is a Subsidiary of Borrower, (iii) [he]/[she] has made such investigation
and inquiries, including but not limited to consultation with other officers of
the Credit Parties responsible for financial and accounting functions concerning
contingent liabilities, as [he]/[she] has deemed necessary and prudent to enable
[him]/[her] to express an informed opinion as to matters referred to herein and
(iv) [he]/[she] has reviewed the consolidated financial statements referred to
in Section 4.7 of the Credit Agreement and the Projections referred to in
Section 4.8 of the Credit Agreement, and that, as such, [he]/[she] is authorized
to execute and deliver this Certificate on behalf of Borrower.

The undersigned hereby further certifies, in [his]/[her] capacity as chief
financial officer of Borrower, and not in [his]/[her] individual capacity, that
as of the date hereof:

 

  a. the sum of Borrower’s and Credit Parties’ debt, on a consolidated basis,
(including contingent liabilities) does not exceed the present fair saleable
value of Borrower’s and Credit Parties’ present assets, on a consolidated basis;

 

  b. Borrower’s and Credit Parties’ capital, on a consolidated basis, is not
unreasonably small in relation to their business as contemplated on the date
hereof and reflected in the Projections or with respect to any transaction
contemplated to be undertaken after the date hereof; and

 

  c. Borrower and Credit Parties, on a consolidated basis, have not incurred and
do not intend to incur, or believe (nor should they reasonably believe) that
they will incur, debts beyond their ability to pay such debts as they become due
(whether at maturity or otherwise).

The undersigned hereby further certifies, in [his]/[her] capacity as chief
financial officer of Borrower, and not in [his]/[her] individual capacity, that
as of the date hereof:

 

  a. the property of Borrower and Credit Parties, on a consolidated basis, is
sufficient, if disposed of at a fairly conducted sale under legal process, to
enable payment of all their obligations, due and accruing due;

 

EXHIBIT F-2-1

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

  b. the property of Borrower and Credit Parties, on a consolidated basis, is,
at fair valuation, greater than the total amount of liabilities, including
contingent liabilities, of Borrower and Credit Parties, on a consolidated basis;
and

 

  c. Borrower and Credit Parties, on a consolidated basis, have not ceased
paying their current obligations in the ordinary course of business as they
generally become due.

For purposes of this Certificate, the amount of any contingent liability at any
time shall be computed as the amount that, in light of all of the facts and
circumstances existing at such time, represents the amount that can reasonably
be expected to become an actual or matured liability (irrespective of whether
such contingent liabilities meet the criteria for accrual under Statement of
Financial Accounting Standard No. 5 or any other analogous criteria in any
jurisdiction).

This Certificate is being delivered by the undersigned only in [his]/[her]
capacity as chief financial officer of Borrower and not individually and the
undersigned shall have no personal liability to the Agents, the Arrangers or the
Lenders with respect thereto.

[Remainder of this page intentionally left blank]

 

EXHIBIT F-2-2

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

IN WITNESS WHEREOF, the undersigned has executed this Certificate as of the date
first written above.

 

By:  

 

  Name:     Title:   Chief Financial Officer

Goldman Sachs Lending Partners LLC,

as Administrative Agent,

and the Lenders

In care of:

Goldman Sachs Lending Partners LLC

200 West Street

New York, New York 10282

 

EXHIBIT F-2-3

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

EXHIBIT G TO

THIRD AMENDED AND RESTATED CREDIT AND GUARANTY AGREEMENT

COUNTERPART AGREEMENT

This COUNTERPART AGREEMENT, dated [            ], 20[    ] (this “Counterpart
Agreement”) is delivered pursuant to the Third Amended and Restated Credit and
Guaranty Agreement, dated as of February 13, 2012 (as it may be amended,
restated, replaced, supplemented or otherwise modified from time to time, the
“Credit Agreement”; the terms defined therein and not otherwise defined herein
being used herein as therein defined), among Valeant Pharmaceuticals
International, Inc., a corporation continued under the federal laws of Canada
(“Borrower”), certain Subsidiaries of Borrower, as Guarantors, the Lenders party
thereto from time to time, Goldman Sachs Lending Partners LLC (“GSLP”), J.P.
Morgan Securities LLC and Morgan Stanley Senior Funding, Inc. (“Morgan
Stanley”), as Joint Lead Arrangers and Joint Bookrunners, JPMorgan Chase Bank,
N.A. (“JPMorgan”) and Morgan Stanley, as Co-Syndication Agents, JPMorgan, as
Issuing Bank, GSLP, as Administrative Agent and Collateral Agent, and the other
Agents party thereto.

Section 1. Pursuant to Section 5.10 of the Credit Agreement, the undersigned
hereby:

(a) agrees that this Counterpart Agreement may be attached to the Credit
Agreement and that by the execution and delivery hereof, the undersigned becomes
a Guarantor under the Credit Agreement and agrees to be bound by all of the
terms thereof applicable to it as a Guarantor thereunder;

(b) represents and warrants that each of the representations and warranties set
forth in the Credit Agreement and each other Credit Document and applicable to
the undersigned is true and correct in all material respects on and as of the
date of this Counterpart Agreement, except to the extent that any such
representation and warranty relates solely to any earlier date, in which case
such representation and warranty is true and correct in all material respects as
of such earlier date; and

(c) agrees to irrevocably and unconditionally guaranty to the Administrative
Agent, jointly and severally with the other Guarantors, the due and punctual
payment in full of all Obligations when the same shall become due, whether at
stated maturity, by required prepayment, declaration, acceleration, demand or
otherwise (including amounts that would become due but for the operation of the
automatic stay under Section 362(a) of the Bankruptcy Code, 11 U.S.C. § 362(a))
and in accordance with Section 7 of the Credit Agreement.

Section 2. The undersigned agrees from time to time, upon request of
Administrative Agent, to take such additional actions and to execute and deliver
such additional documents and instruments as Administrative Agent may reasonably
request to effect the transactions contemplated by, and to carry out the intent
of, this Counterpart Agreement. Neither this Counterpart Agreement nor any term
hereof may be changed, waived, discharged or terminated, except by an instrument
in writing signed by the party (including, if applicable, any party required to
evidence its consent to or acceptance of this Counterpart Agreement) against
whom enforcement of such change, waiver, discharge or termination is sought. Any
notice or other communication herein required or permitted to be given shall be
given pursuant to Section 10.1 of the Credit Agreement, and all for purposes
thereof, the notice address of the undersigned shall be the address as set forth
on the signature page hereof. In case any provision in or obligation under this
Agreement 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.

 

EXHIBIT G-1

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

THIS AGREEMENT SHALL BE GOVERNED BY, AND SHALL BE CONSTRUED AND ENFORCED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.

THE PROVISIONS OF THE CREDIT AGREEMENT UNDER THE HEADINGS “CONSENT TO
JURISDICTION” AND “WAIVER OF JURY TRIAL” ARE INCORPORATED HEREIN BY THIS
REFERENCE AND SUCH INCORPORATION SHALL SURVIVE ANY TERMINATION OF THE CREDIT
AGREEMENT.

[Remainder of page intentionally left blank]

 

EXHIBIT G-2

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

IN WITNESS WHEREOF, the undersigned has caused this Counterpart Agreement to be
duly executed and delivered by its duly authorized officer as of the date above
first written.

 

[NAME OF CREDIT PARTY]   By:  

 

    Name:     Title: [Authorized Officer]

 

Address for Notices:  

 

 

 

 

 

  Attention:   Telecopier with a copy to:  

 

 

 

 

 

  Attention:   Telecopier

 

ACKNOWLEDGED AND ACCEPTED,

as of the date above first written:

GOLDMAN SACHS LENDING PARTNERS LLC,

as Administrative Agent and Collateral Agent

By:  

 

  Name:   Title:

 

EXHIBIT G-3

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

EXHIBIT H-1 TO

THIRD AMENDED AND RESTATED CREDIT AND GUARANTY AGREEMENT

CANADIAN GUARANTEE

[Provided under separate cover]

 

EXHIBIT H-1-1

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

EXHIBIT H-2 TO

THIRD AMENDED AND RESTATED CREDIT AND GUARANTY AGREEMENT

BARBADOS GUARANTEE

[Provided under separate cover]

 

EXHIBIT H-2-1

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

EXHIBIT I-1 TO

THIRD AMENDED AND RESTATED CREDIT AND GUARANTY AGREEMENT

SECOND AMENDED AND RESTATED PLEDGE & SECURITY AGREEMENT

[Provided under separate cover]

 

EXHIBIT I-1-1

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

EXHIBIT I-2 TO

THIRD AMENDED AND RESTATED CREDIT AND GUARANTY AGREEMENT

CANADIAN PLEDGE & SECURITY AGREEMENT

[Provided under separate cover]

 

EXHIBIT I-2-1

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

EXHIBIT J-1 TO

THIRD AMENDED AND RESTATED CREDIT AND GUARANTY AGREEMENT

INTERCOMPANY NOTE

New York, New York

[            ], 20[    ]

For value received, each of the undersigned listed on the signature pages hereto
as a Payor, to the extent a borrower from time to time from any Payee (each, a
“Payor”), hereby promises to pay on demand to the order of such other entity
listed on the signature pages hereto as a Payee or its assigns (each, a
“Payee”), in lawful money of the United States of America (or such other
currency as agreed to by any Payor and Payee) in immediately available funds, at
such location as the Payee shall from time to time designate, the unpaid
principal amount of all loans and advances made by the Payee to the Payor.

Each Payor promises also to pay interest on the unpaid principal amount hereof
in like money at said location from the date hereof until paid at such rate per
annum as shall be agreed upon from time to time by such Payor and any Payee.

This Note is one of the Intercompany Notes referred to in the Third Amended and
Restated Credit and Guaranty Agreement, dated as of February 13, 2012 (as it may
be amended, restated, replaced, supplemented or otherwise modified from time to
time, the “Credit Agreement”; the terms defined therein and not otherwise
defined herein being used herein as therein defined), among Valeant
Pharmaceuticals International, Inc., a corporation continued under the federal
laws of Canada (“Borrower”), certain Subsidiaries of Borrower, as Guarantors,
the Lenders party thereto from time to time, Goldman Sachs Lending Partners LLC
(“GSLP”), J.P. Morgan Securities LLC and Morgan Stanley Senior Funding, Inc.
(“Morgan Stanley”), as Joint Lead Arrangers and Joint Bookrunners, JPMorgan
Chase Bank, N.A. (“JPMorgan”) and Morgan Stanley, as Co-Syndication Agents,
JPMorgan, as Issuing Bank, GSLP, as Administrative Agent and Collateral Agent,
and the other Agents party thereto, and is subject to the terms thereof and, to
the extent the Payee is Borrower or a Guarantor, shall be pledged by the Payee
pursuant to the Amended and Restated Pledge and Security Agreement. If this note
is so pledged, each Payor hereby acknowledges and agrees that the Collateral
Agent may exercise all rights provided therein with respect to this Note.

Each Payee is hereby authorized (but shall not be required) to record all loans
and advances made by it to any Payor (all of which shall be evidenced by this
Note), and all repayments or prepayments thereof, in its books and records, such
books and records constituting prima facie evidence of the accuracy of the
information contained therein.

All payments under this Note shall be made without offset, counterclaim or
deduction of any kind.

Each Payor hereby waives presentment, demand, protest or notice of any kind in
connection with this Note.

Each of the payors and payees of intercompany indebtedness outstanding on the
date hereof and evidenced by a promissory note (the “Existing Notes”) that are
Payors and/or Payees acknowledges and agrees that this Note supersedes and
replaces each such Existing Note (other than any such Existing Note that has
been pledged by the Payee thereof and delivered to the Collateral Agent in
accordance with the terms of the Amended and Restated Pledge and Security
Agreement) to which such Payor or Payee is party

 

EXHIBIT J-1-1

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

and that, for the avoidance of doubt, this Note does not constitute a repayment,
release, discharge, refinancing or novation of any obligations and liabilities
existing under the Existing Notes. Each Payor and Payee party to any Existing
Notes agree that the principal amount, interest rate and, if applicable,
payments and maturity date of the indebtedness evidenced by such Existing Notes
prior to the date hereof shall continue to apply to such indebtedness as
evidenced by this Note on and after the date hereof.

THIS NOTE SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE
STATE OF NEW YORK.

THE PROVISIONS OF THE CREDIT AGREEMENT UNDER THE HEADINGS “CONSENT TO
JURISDICTION” AND “WAIVER OF JURY TRIAL” ARE INCORPORATED HEREIN BY THIS
REFERENCE AND SUCH INCORPORATION SHALL SURVIVE ANY TERMINATION OF THE CREDIT
AGREEMENT.

[signature page to follow]

 

EXHIBIT J-1-2

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

VALEANT PHARMACEUTICALS INTERNATIONAL, INC., as Payee and Payor By:  

 

  Name:   Title: [SUBSIDIARIES OF BORROWER], as Payee and Payor By:  

 

  Name:   Title:

 

EXHIBIT J-1-3

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

EXHIBIT J-2 TO

THIRD AMENDED AND RESTATED CREDIT AND GUARANTY AGREEMENT

AFFILIATE SUBORDINATION AGREEMENT

THIS AFFILIATE SUBORDINATION AGREEMENT (as amended, restated, supplemented or
otherwise modified from time to time, this “Agreement”), dated as of June 29,
2011, made by each of the undersigned entities listed on the signature pages
hereto under the caption (i) “Payors” and any additional entity that may become
a Payor hereunder pursuant to a duly executed signature page hereto and agreeing
to be bound hereby (each, in such capacity, a “Payor”) and (ii) “Payee” and any
additional entity that may become a Payee hereunder pursuant to a duly executed
signature page hereto and agreeing to be bound hereby (each, in such capacity, a
“Payee”).

This Agreement constitutes the subordination agreement referred to in
Section 6.1(c)(ii) of the Credit and Guaranty Agreement, dated as of June 29,
2011 (as it may be amended, restated, replaced, supplemented or otherwise
modified from time to time, the “Credit Agreement”; the terms defined therein
and not otherwise defined herein being used herein as therein defined), among
Valeant Pharmaceuticals International, a Delaware corporation (“Borrower”),
Valeant Pharmaceuticals International, Inc., a corporation continued under the
federal laws of Canada (“Parent”), certain Subsidiaries of Parent, as
Guarantors, the Lenders party thereto from time to time and Goldman Sachs
Lending Partners LLC (“GSLP”), as Sole Lead Arranger, Sole Bookrunner,
Syndication Agent, Administrative Agent and Collateral Agent, and is subject to
the terms thereof. Each Payee (as defined below) hereby acknowledges and agrees
that the Administrative Agent may exercise all rights provided in the Credit
Agreement and the Pledge and Security Agreement with respect to this Agreement.

Anything in this Agreement to the contrary notwithstanding, any indebtedness
owing from time to time in respect of all loans or advances (including, without
limitation, pursuant to guarantees therefor or security therefor) which are owed
by any Payor to any Payee (such indebtedness, the “Subordinated Intercompany
Obligations”) shall be subordinate and junior in right of payment, to the extent
and in the manner hereinafter set forth, to all Obligations of such Payor under
the Credit Agreement, including, without limitation, where applicable, under
such Payor’s guarantee of the Obligations under the Credit Agreement; provided
that such Payor may make payments to the applicable Payee unless an Event of
Default shall have occurred and be continuing (such Obligations and other
indebtedness and obligations in connection with any renewal, refunding,
restructuring or refinancing thereof, including interest thereon accruing after
the commencement of any proceedings referred to in clause (i) below, whether or
not such interest is an allowed claim in such proceeding, being hereinafter
collectively referred to as “Senior Indebtedness”):

(i) In the event of any insolvency or bankruptcy proceedings, and any
receivership, liquidation, reorganization or other similar proceedings in
connection therewith, relative to any Payor or to its creditors, as such, or to
its property, and in the event of any proceedings for voluntary liquidation,
dissolution or other winding up of such Payor (except as otherwise expressly
permitted by the Credit Agreement), whether or not involving insolvency or
bankruptcy, then (x) the holders of Senior Indebtedness (other than unasserted
indemnification obligations and unasserted expense reimbursement obligations)
shall be paid in full in cash in respect of all amounts constituting Senior
Indebtedness before any Payee is entitled to receive (whether directly or
indirectly), or make any demands for, any payment on account of this Agreement
from such Payor and (y) until the holders of Senior Indebtedness (other than
unasserted indemnification obligations and unasserted expense reimbursement
obligations) are paid in full in cash in respect of all amounts constituting
Senior Indebtedness, any payment or distribution to which such Payee

 

EXHIBIT J-2-1

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

would otherwise be entitled from such Payor (other than debt securities of such
Payor that are subordinated, to at least the same extent as the Subordinated
Intercompany Obligations, to the payment of all Senior Indebtedness then
outstanding (such securities being hereinafter referred to as “Restructured Debt
Securities”)) shall be made to the holders of Senior Indebtedness;

(ii) if any Default occurs and is continuing with respect to any Senior
Indebtedness (including any Default under the Credit Agreement), then no payment
or distribution of any kind or character shall be made by or on behalf of any
Payor or any other Person on its behalf with respect to the Subordinated
Intercompany Obligations until the holders of Senior Indebtedness are paid in
full in cash in respect of all amounts constituting Senior Indebtedness (other
than unasserted indemnification obligations and unasserted expense reimbursement
obligations); and

(iii) if any payment or distribution of any character, whether in cash,
securities or other property (other than Restructured Debt Securities), in
respect of the Subordinated Intercompany Obligations shall (despite these
subordination provisions) be received by any Payee in violation of clause (i) or
(ii) before all Senior Indebtedness shall have been paid in full in cash, such
payment or distribution shall be held in trust for the benefit of, and shall be
paid over or delivered to, the holders of Senior Indebtedness (or their
representatives), ratably according to the respective aggregate amounts
remaining unpaid thereon, to the extent necessary to pay all Senior Indebtedness
(other than unasserted indemnification obligations and unasserted expense
reimbursement obligations) in full in cash.

To the fullest extent permitted by law, no present or future holder of Senior
Indebtedness shall be prejudiced in its right to enforce the subordination of
this Agreement by any act or failure to act on the part of any Payor or by any
act or failure to act on the part of such holder or any trustee or agent for
such holder. Each Payee and each Payor hereby agree that the subordination of
the Subordinated Intercompany Obligations is for the benefit of the
Administrative Agent and the Lenders and the Administrative Agent and the
Lenders are obligees under this Agreement to the same extent as if their names
were written herein as such and the Administrative Agent may, on behalf of the
itself and the Lenders, proceed to enforce the subordination provisions herein.

Nothing contained in this Agreement is intended to or will impair, as between
each Payor and each Payee, the obligations of such Payor, which are absolute and
unconditional, to pay to such Payee the principal of and interest on the
Subordinated Intercompany Obligations as and when due and payable in accordance
with its terms, or is intended to or will affect the relative rights of such
Payee and other creditors of such Payor other than the holders of Senior
Indebtedness.

Subject to the prior payment in full in cash of the Senior Indebtedness (other
than unasserted indemnification obligations and unasserted expense reimbursement
obligations), each applicable Payee shall be subrogated to the rights of the
Administrative Agent and the Lenders to receive payments or distributions in
cash, securities or other property of each applicable Payor applicable to the
Senior Indebtedness until all amounts owing on the Senior Indebtedness (other
than unasserted indemnification obligations and unasserted expense reimbursement
obligations) shall be paid in full in cash, and, as between and among a Payor,
its creditors (other than the Lenders) and the applicable Payees, no such
payment or distribution made to the Administrative Agent or the Lenders by
virtue of this Agreement that otherwise would have been made to any applicable
Payee shall be deemed to be a payment by the applicable Payor on account of the
Subordinated Intercompany Obligations, it being understood that the provisions
of this paragraph are intended solely for the purpose of defining the relative
rights of the Payees, on the one hand, and Administrative Agent and the Lenders,
on the other hand.

 

EXHIBIT J-2-2

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No amendment, modification, supplement, termination or waiver of or to any
provision hereof, nor consent to any departure by any Payor or Payee therefrom,
shall be effective unless the same shall be consented to in writing by the
Administrative Agent and made in accordance with the terms of the Credit
Agreement. Any provision hereof which is invalid, illegal or unenforceable in
any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of
such invalidity, illegality or unenforceability without invalidating the
remaining provisions hereof or affecting the validity, legality or
enforceability of such provision in any other jurisdiction. This Agreement and
any amendments, waivers, consents or supplements hereto may be executed in any
number of counterparts and by different parties hereto in separate counterparts,
each of which when so executed and delivered shall be deemed to be an original,
but all such counterparts together shall constitute one and the same agreement.
Delivery of an executed counterpart to this Agreement by facsimile transmission
or other electronic transmission (such as .pdf or .tif) shall be effective as
delivery of a manually signed counterpart of this Agreement.

THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS
OF THE STATE OF NEW YORK.

THE PROVISIONS OF THE CREDIT AGREEMENT UNDER THE HEADINGS “CONSENT TO
JURISDICTION” AND “WAIVER OF JURY TRIAL” ARE INCORPORATED HEREIN BY THIS
REFERENCE AND SUCH INCORPORATION SHALL SURVIVE ANY TERMINATION OF THE CREDIT
AGREEMENT.

[REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK.]

 

EXHIBIT J-2-3

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PAYORS: [List Borrower and any Guarantor that is a Payor under any intercompany
debt] By:  

 

  Name:   Title: PAYEES: [List any Subsidiary that is a Payee under any
intercompany debt owing from any Payor listed above] By:  

 

  Name:   Title:

 

EXHIBIT J-2-4

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

ACKNOWLEDGED AND ACCEPTED,

as of the date above first written:

GOLDMAN SACHS LENDING PARTNERS LLC, as Administrative Agent By:  

 

  (Authorized Signatory)

 

EXHIBIT J-2-5

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ANNEX 1 TO

AFFILIATE SUBORDINATION AGREEMENT

SUPPLEMENT TO AFFILIATE SUBORDINATION AGREEMENT

SUPPLEMENT, dated as of [    ], among each of the undersigned entities listed on
the signature pages hereto, to the Affiliate Subordination Agreement, dated as
of June 29, 2011, among each of the Payors thereto, each of the Payees thereto
and Goldman Sachs Lending Partners LLC (“GSLP”), as Administrative Agent.

Reference is made to the Third Amended and Restated Credit and Guaranty
Agreement, dated as of February 13, 2012 (as it may be amended, restated,
replaced, supplemented or otherwise modified from time to time, the “Credit
Agreement”), among Valeant Pharmaceuticals International, Inc., a corporation
continued under the federal laws of Canada (“Borrower”), certain Subsidiaries of
Borrower, as Guarantors, the Lenders party thereto from time to time, GSLP, J.P.
Morgan Securities LLC and Morgan Stanley Senior Funding, Inc. (“Morgan
Stanley”), as Joint Lead Arrangers and Joint Bookrunners, JPMorgan Chase Bank,
N.A. (“JPMorgan”) and Morgan Stanley, as Co-Syndication Agents, JPMorgan, as
Issuing Bank, GSLP, as Administrative Agent and Collateral Agent, and the other
Agents party thereto. Capitalized terms used herein and not otherwise defined
herein shall have the meanings assigned to such terms in the Credit Agreement
and the Affiliate Subordination Agreement.

Borrower and the Guarantors have entered into the Affiliate Subordination
Agreement in order to induce the Lenders to make Loans and the Issuing Bank to
issue Letters of Credit. The undersigned Payors (the “Additional Payors”) and
Payees (the “Additional Payees”) are executing this Supplement in accordance
Section 6.1(c)(ii) of the Credit Agreement in order to induce the Lenders to
make additional Loans and the Issuing Bank to issue additional Letters of
Credit.

Accordingly, the Administrative Agent, the Additional Payors and the Additional
Payees agree as follows:

SECTION 1. Each Additional Payor and Additional Payee by its signature below
becomes a Payor or Payee, respectively, under the Affiliate Subordination
Agreement with the same force and effect as if originally named therein as a
Payor or Payee, as applicable and each Additional Payor and Additional Payee
hereby agrees to all the terms and provisions of the Affiliate Subordination
Agreement applicable to it as a Payor or Payee, as applicable, thereunder. Each
reference to a Payor or Payee in the Affiliate Subordination Agreement shall be
deemed to include the Additional Payors and Additional Payees, respectively. The
Affiliate Subordination Agreement is hereby incorporated herein by reference.

SECTION 2. Each Additional Payor and Additional Payee represents and warrants to
the Administrative Agent that this Supplement has been duly authorized, executed
and delivered by it and constitutes its legal, valid and binding obligation,
enforceable against it in accordance with its terms.

SECTION 3. This Supplement may be executed in counterparts (and by different
parties hereto on different counterparts), each of which shall constitute an
original, but all of which when taken together shall constitute a single
contract. This Supplement shall become effective when the Administrative Agent
shall have received a counterpart of this Supplement that bears the signature of
each Additional Payor and

 

EXHIBIT J-2-6

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

Additional Payee and the Administrative Agent has executed a counterpart hereof.
Delivery of an executed signature page to this Supplement by facsimile or other
electronic transmission (such as “.pdf” or “.tif”) shall be effective as
delivery of a manually signed counterpart of this Supplement.

SECTION 4. Except as expressly supplemented hereby, the Affiliate Subordination
Agreement shall remain in full force and effect.

SECTION 5. THIS SUPPLEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE
WITH, THE LAWS OF THE STATE OF NEW YORK. THE PROVISIONS OF THE CREDIT AGREEMENT
UNDER THE HEADINGS “CONSENT TO JURISDICTION” AND “WAIVER OF JURY TRIAL” ARE
INCORPORATED HEREIN BY THIS REFERENCE AND SUCH INCORPORATION SHALL SURVIVE ANY
TERMINATION OF THE CREDIT AGREEMENT.

SECTION 6. In case any one or more of the provisions contained in this
Supplement should be held invalid, illegal or unenforceable in any respect, the
validity, legality and enforceability of the remaining provisions contained
herein and in the Affiliate Subordination Agreement shall not in any way be
affected or impaired thereby (it being understood that the invalidity of a
particular provision in a particular jurisdiction shall not in and of itself
affect the validity of such provision in any other jurisdiction). The parties
hereto shall endeavor in good-faith negotiations to replace the invalid, illegal
or unenforceable provisions with valid provisions the economic effect of which
comes as close as possible to that of the invalid, illegal or unenforceable
provisions.

[Signature Page Follows]

 

EXHIBIT J-2-7

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

ADDITIONAL PAYORS: [List additional Guarantors that are Payors under any
intercompany debt] By:  

 

  Name:   Title: ADDITIONAL PAYEES: [List any additional Subsidiaries that are
Payees under any intercompany debt owing from any Payor listed above] By:  

 

  Name:   Title:

 

EXHIBIT J-2-8

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

ACKNOWLEDGED AND ACCEPTED,

as of the date above first written:

GOLDMAN SACHS LENDING PARTNERS LLC,

as Administrative Agent

By:  

 

  (Authorized Signatory)

 

EXHIBIT J-2-9

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EXHIBIT K TO

THIRD AMENDED AND RESTATED CREDIT AND GUARANTY AGREEMENT

JOINDER AGREEMENT

This Joinder Agreement, dated as of [            ], 20[    ] (this “Agreement”),
by and among [NEW LENDERS] (each a “Lender” and collectively the “Lenders”),
Valeant Pharmaceuticals International, Inc., a corporation continued under the
federal laws of Canada (“Borrower”) and Goldman Sachs Lending Partners LLC
(“GSLP”), as Administrative Agent.

RECITALS:

WHEREAS, reference is hereby made to the Third Amended and Restated Credit and
Guaranty Agreement, dated as of February 13, 2012 (as it may be amended,
restated, replaced, supplemented or otherwise modified from time to time, the
“Credit Agreement”; the terms defined therein and not otherwise defined herein
being used herein as therein defined), among Borrower, certain Subsidiaries of
Borrower, as Guarantors, the Lenders party thereto from time to time, GSLP, J.P.
Morgan Securities LLC and Morgan Stanley Senior Funding, Inc. (“Morgan
Stanley”), as Joint Lead Arrangers and Joint Bookrunners, JPMorgan Chase Bank,
N.A. (“JPMorgan”) and Morgan Stanley, as Co-Syndication Agents, JPMorgan, as
Issuing Bank, GSLP, as Administrative Agent and Collateral Agent, and the other
Agents party thereto; and

WHEREAS, subject to the terms and conditions of the Credit Agreement, Borrower
may obtain New Revolving Loan Commitments and/or New Term Loan Commitments by
entering into one or more Joinder Agreements with the New Term Loan Lenders.

NOW, THEREFORE, in consideration of the premises and agreements, provisions and
covenants herein contained, the parties hereto agree as follows:

Each Lender party hereto hereby agrees to commit to provide its respective New
Revolving Loan Commitment and/or New Term Loan Commitment as set forth on
Schedule A annexed hereto, on the terms and subject to the conditions set forth
below:

Each Lender (i) confirms that it has received a copy of the Credit Agreement and
the other Credit Documents, together with copies of the financial statements
referred to therein and such other documents and information as it has deemed
appropriate to make its own credit analysis and decision to enter into this
Agreement; (ii) agrees that it will, independently and without reliance upon the
Administrative Agent or any other Lender or Agent and based on such documents
and information as it shall deem appropriate at the time, continue to make its
own credit decisions in taking or not taking action under the Credit Agreement;
(iii) appoints and authorizes Administrative Agent and each other Agent to take
such action as agent on its behalf and to exercise such powers under the Credit
Agreement and the other Credit Documents as are delegated to Administrative
Agent or such other Agent, as the case may be, by the terms thereof, together
with such powers as are reasonably incidental thereto; and (iv) agrees that it
will perform in accordance with their terms all of the obligations which by the
terms of the Credit Agreement are required to be performed by it as a Lender.

Each Lender hereby agrees to make its Commitment on the following terms and
conditions:

 

[1. Applicable Margin. The Applicable Margin for each Series [    ] New Term
Loan shall mean, as of any date of determination, [    ]% per annum

 

EXHIBIT K-1

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

2. Principal Payments. Borrower shall make principal payments on the Series
[    ] New Term Loans in installments on the dates and in the amounts equal to
the percentage set forth below of an amount equal to the aggregate principal
amount of the Series [    ] New Term Loans outstanding as of the date hereof:

 

(A) Payment Date

   (B)
Scheduled
Repayment of
Series [    ] New Term Loans             %            %            %           
% 

Series [    ] New Term Loan Maturity Date

     Remaining Balance   

 

3. Voluntary and Mandatory Prepayments. Scheduled installments of principal of
the Series [    ] New Term Loans set forth above shall be reduced in connection
with any voluntary or mandatory prepayments of the Series [    ] New Term Loans
in accordance with Sections 2.12, 2.13 and 2.14 of the Credit Agreement
respectively.

 

4. Prepayment Fees. Borrower agrees to pay to each New Term Loan Lender the
following prepayment fees, if any: [            ].

[Insert other additional prepayment provisions with respect to New Term Loans]

 

5. Other Fees. Borrower agrees to pay each Lender its Pro Rata Share of an
aggregate fee equal to $[            ] on [            ], 20[    ].

 

6. Proposed Borrowing. This Agreement represents Borrower’s request to borrow
Series [    ] New Term Loans from the Lenders as follows (the “Proposed
Borrowing”):

 

a.      Business Day of Proposed Borrowing:                ,     b.      Amount
of Proposed Borrowing: $                      c.      Interest rate option:    ¨
   a. Base Rate Loan(s)         ¨    b. Eurodollar Rate Loans            with an
initial Interest            Period of      month(s)]1

 

1  Insert completed items 1-6 as applicable, with respect to New Term Loans,
with such modifications as may be agreed to by the parties hereto to the extent
consistent with Section 2.25 of the Credit Agreement.

 

EXHIBIT K-2

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

7. New Lenders. Each Lender (other than any Lender that, immediately prior to
the execution of this Agreement, is a “Lender” under the Credit Agreement)
acknowledges and agrees that upon its execution of this Agreement its Series
[    ] New Term Loan Commitments and/or New Revolving Loan Commitments shall be
effective and that such Lender shall become a “Lender” under, and for all
purposes of, the Credit Agreement and the other Credit Documents, and shall be
subject to and bound by the terms thereof, and shall perform all the obligations
of and shall have all rights of a Lender thereunder.

 

8. Credit Agreement Governs. Series [    ] New Term Loans and/or New Revolving
Loan Commitments shall be subject to the provisions of the Credit Agreement and
the other Credit Documents, except as set forth in this Agreement.

 

9. Borrower’s Certifications. By its execution of this Agreement, the
undersigned officer, to the best of his or her knowledge, and Borrower hereby
certify that:

 

  i. The representations and warranties contained in the Credit Agreement and
the other Credit Documents are true and correct in all material respects on and
as of the date hereof to the same extent as though made on and as of the date
hereof, except to the extent such representations and warranties specifically
relate to an earlier date, in which case such representations and warranties
were true and correct in all material respects on and as of such earlier date;

 

  ii. No event has occurred and is continuing or would result from the
consummation of the Proposed Borrowing contemplated hereby that would constitute
a Default or an Event of Default; and

 

  iii. Borrower has performed in all material respects all agreements and
satisfied all conditions which the Credit Agreement provides shall be performed
or satisfied by it on or before the date hereof in connection with the Proposed
Borrowing.

 

10. Borrower Covenants. By its execution of this Agreement, Borrower hereby
covenants that:

 

  i. Borrower shall deliver or cause to be delivered the following legal
opinions and documents: [            ], together with all other legal opinions
and other documents reasonably requested by Administrative Agent in connection
with this Agreement; and

 

  ii. Set forth on the attached Officers’ Certificate are the calculations (in
reasonable detail) demonstrating compliance with the financial tests described
in Section 6.7 of the Credit Agreement.

 

EXHIBIT K-3

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

11. Eligible Assignee. By its execution of this Agreement, each Lender (other
than any Lender that, immediately prior to the execution of this Agreement, is a
“Lender” under the Credit Agreement) represents and warrants that it is an
Eligible Assignee.

 

12. Notice. For purposes of the Credit Agreement, the initial notice address of
each Lender shall be as set forth below its signature below.

 

13. Non-U.S. Lenders. For each Lender that is a Non-U.S. Lender, delivered
herewith to Administrative Agent are such forms, certificates or other evidence
with respect to United States federal income tax withholding matters as such
Lender may be required to deliver to Administrative Agent pursuant to subsection
2.20(d) of the Credit Agreement.

 

14. Recordation of the New Loans. Upon execution and delivery hereof,
Administrative Agent will record the Series [    ] New Term Loans and/or New
Revolving Loan Commitments made by Lenders pursuant hereto in the Register.

 

15. Amendment, Modification and Waiver. This Agreement may not be amended,
modified or waived except by an instrument or instruments in writing signed and
delivered on behalf of each of the parties hereto.

 

16. Entire Agreement. This Agreement, the Credit Agreement and the other Credit
Documents constitute the entire agreement among the parties with respect to the
subject matter hereof and thereof and supersede all other prior agreements and
understandings, both written and verbal, among the parties or any of them with
respect to the subject matter hereof.

 

17. GOVERNING LAW. THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES
HEREUNDER SHALL BE GOVERNED BY, AND SHALL BE CONSTRUED AND ENFORCED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.

 

18. Severability. Any term or provision of this Agreement which is invalid or
unenforceable in any jurisdiction shall, as to that jurisdiction, be ineffective
to the extent of such invalidity or unenforceability without rendering invalid
or unenforceable the remaining terms and provisions of this Agreement or
affecting the validity or enforceability of any of the terms or provisions of
this Agreement in any other jurisdiction. If any provision of this Agreement is
so broad as to be unenforceable, the provision shall be interpreted to be only
so broad as would be enforceable.

 

19. Counterparts. This Agreement may be executed in counterparts, each of which
shall be deemed to be an original, but all of which shall constitute one and the
same agreement.

[Remainder of page intentionally left blank]

 

EXHIBIT K-4

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

IN WITNESS WHEREOF, each of the undersigned has caused its duly authorized
officer to execute and deliver this Agreement as of [            ], 20[    ].

 

[NAME OF LENDER]   By:  

 

  Name:     Title:   Notice Address:   Attention:   Telephone:   Facsimile:  
VALEANT PHARMACEUTICALS INTERNATIONAL, INC.   By:  

 

  Name:     Title:  

 

EXHIBIT K-5

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

Consented to by:

GOLDMAN SACHS LENDING PARTNERS LLC

As Administrative Agent

By:  

 

  Authorized Signatory [Consented to by:

JPMORGAN CHASE BANK, N.A. , as

As Issuing Bank

By:  

 

  Title:] 2

 

2  For New Revolving Loan Commitments only.

 

EXHIBIT K-6

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SCHEDULE A

TO JOINDER AGREEMENT

 

Name of Lender

  

Type of Commitment

   Amount     

New Term Loan Commitment

   $                      

 

 

    

New Revolving Loan Commitment

   $                      

 

 

    

Total:

   $                      

 

 

 

 

EXHIBIT K-7

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EXHIBIT L TO

THIRD AMENDED AND RESTATED CREDIT AND GUARANTY AGREEMENT

CONTRIBUTION AGREEMENT

CONTRIBUTION AGREEMENT dated as of June 29, 2011 (this “Agreement”), among
Valeant Pharmaceuticals International, a Delaware corporation (“Borrower”),
Valeant Pharmaceuticals International, Inc., a corporation continued under the
federal laws of Canada (“Parent”), certain Subsidiaries of Parent, as
Guarantors, and Goldman Sachs Lending Partners LLC (“GSLP”), as Administrative
Agent (in such capacity, the “Administrative Agent”).

Reference is made to the Credit and Guaranty Agreement, dated as of June 29,
2011 (as it may be amended, restated, replaced, supplemented or otherwise
modified from time to time, the “Credit Agreement”; the terms defined therein
and not otherwise defined herein being used herein as therein defined), among
Borrower, Parent, certain Subsidiaries of Parent, as Guarantors, the Lenders
party thereto from time to time and GSLP, as Sole Lead Arranger, Sole
Bookrunner, Syndication Agent, Administrative Agent and Collateral Agent.

The Lenders have agreed to make Loans to Borrower, and the Issuing Bank has
agreed to issue Letters of Credit for the account of Borrower, pursuant to, and
upon the terms and subject to the conditions specified in, the Credit Agreement.
The Guarantors have guaranteed such Loans and the other Obligations pursuant to
(i) Section 7 of the Credit Agreement, (ii) the Canadian Guarantee or (iii) the
Barbados Guarantee (collectively, the “Guaranty”). The obligations of the
Lenders to make Loans and of the Issuing Bank to issue Letters of Credit are
conditioned on, among other things, the execution and delivery by Borrower and
the Guarantors of an agreement in the form hereof.

Accordingly, Borrower, each Guarantor and the Administrative Agent agree as
follows:

SECTION 1. Contribution. All Guarantors desire to allocate among themselves
(collectively, the “Contributing Guarantors”), in a fair and equitable manner,
their obligations arising under the Guaranty. Accordingly, in the event any
payment or distribution (including the sale of any assets) is made on any date
by a Guarantor (a “Funding Guarantor”) under the Guaranty or any other Credit
Document such that its Aggregate Payments (as defined below) exceeds its Fair
Share (as defined below) as of such date, such Funding Guarantor shall be
entitled to a contribution from each of the other Contributing Guarantors in an
amount sufficient to cause each Contributing Guarantor’s Aggregate Payments to
equal its Fair Share as of such date. “Fair Share” means, with respect to a
Contributing Guarantor as of any date of determination, an amount equal to
(a) the ratio of (i) the Fair Share Contribution Amount (as defined below) with
respect to such Contributing Guarantor to (ii) the aggregate of the Fair Share
Contribution Amounts with respect to all Contributing Guarantors multiplied by
(b) the aggregate amount paid or distributed on or before such date by all
Funding Guarantors under the Guaranty or any other Credit Document in respect of
the obligations Guaranteed. “Fair Share Contribution Amount” means, with respect
to a Contributing Guarantor as of any date of determination, the maximum
aggregate amount of the obligations of such Contributing Guarantor under the
Guaranty that would not render its obligations hereunder or thereunder subject
to avoidance as a fraudulent transfer or conveyance under Section 548 of Title
11 of the United States Code or any comparable applicable provisions of any
Applicable Law; provided that, solely for purposes of calculating the “Fair
Share Contribution Amount” with respect to any Contributing Guarantor for
purposes of this Agreement, any assets or liabilities of such Contributing
Guarantor arising by virtue of any rights to subrogation, reimbursement or
indemnification or any rights to or obligations of

 

EXHIBIT L-1

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

contribution hereunder shall not be considered as assets or liabilities of such
Contributing Guarantor. “Aggregate Payments” means, with respect to a
Contributing Guarantor as of any date of determination, an amount equal to
(1) the aggregate amount of all payments and distributions made (including the
greater of the book value or fair market value of any assets sold) on or before
such date by such Contributing Guarantor in respect of the Guaranty or its
obligations under any other Credit Document (including in respect of this
Agreement), minus (2) the aggregate amount of all payments received on or before
such date by such Contributing Guarantor from the other Contributing Guarantors
as contributions under this Agreement. The amounts payable as contributions
hereunder shall be determined as of the date on which the related payment or
distribution is made by the applicable Funding Guarantor. The allocation among
Contributing Guarantors of their obligations as set forth in this Agreement
shall not be construed in any way to limit the liability of any Contributing
Guarantor hereunder or under any other Credit Document. Any Contributing
Guarantor making a payment under this Section 1 shall be subrogated to the
rights of the Funding Guarantor under Section 2 below to the extent of such
payment.

SECTION 2. Indemnification. In addition to all such rights of indemnity and
subrogation as the Guarantors may have under applicable law, Borrower agrees
that (a) in the event a payment in respect of any Obligation shall be made by
any Guarantor under the Guaranty, Borrower shall indemnify such Guarantor for
the full amount of such payment and such Guarantor shall be subrogated to the
rights of the Person to whom such payment shall have been made to the extent of
such payment and (b) in the event any assets of any Guarantor shall be sold
pursuant to any Credit Document to satisfy in whole or in part an Obligation
owed to any Secured Party, Borrower shall indemnify such Guarantor in an amount
equal to the greater of the book value or the fair market value of the assets so
sold.

SECTION 3. Subordination. Notwithstanding any provision of this Agreement to the
contrary, all rights of the Guarantors under Sections 1 and 2 hereof and all
other rights of the Guarantors of indemnity, contribution or subrogation under
applicable law or otherwise shall be fully subordinated to the payment in full
in cash of the Obligations. No failure on the part of Borrower or any Guarantor
to make the payments required by Sections 1 and 2 (or any other payments
required under applicable law or otherwise) shall in any respect limit the
obligations and liabilities of any Guarantor with respect to its obligations
hereunder, and each Guarantor shall remain liable for the full amount of the
obligations of such Guarantor hereunder.

SECTION 4. Termination. Upon the payment in full in cash of all Obligations
(other than unasserted indemnification obligations, unasserted expense
reimbursement obligations or obligations under Hedge Agreements and Cash
Management Agreements) and cancellation or expiration of all Letters of Credit
(unless the outstanding amounts under all such Letters of Credit have been cash
collateralized or, if satisfactory to Issuing Bank in its sole discretion, a
backstop letter of credit is in place) and the cancellation, expiration or
termination of the Commitments, this Agreement shall automatically terminate.
Upon the consummation of any transaction expressly permitted by the Credit
Agreement as a result of which a Guarantor ceases to be a Subsidiary of Parent
or the Borrower, such Guarantor shall automatically be released from its
obligations hereunder.

SECTION 5. Miscellaneous. Any notice required or permitted to be given under
this Agreement shall be given in accordance with Section 10.1 of the Credit
Agreement. No failure or delay on the part of the Administrative Agent or any
Guarantor in the exercise of any power, right or privilege hereunder or under
any other Credit Document shall impair such power, right or privilege or be
construed as a waiver of any default or acquiescence therein, nor shall any
single or partial exercise of any such power, right or privilege preclude other
or further exercise thereof or of any other power, right or privilege. All
rights and remedies existing under this Agreement and the other Credit Documents
are cumulative to, and not exclusive of, any rights or remedies otherwise
available. In case any provision in or obligation under this Agreement shall be
invalid, illegal or unenforceable in any jurisdiction, the validity, legality
and enforceability

 

EXHIBIT L-2

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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.
All covenants hereunder shall be given independent effect so that if a
particular action or condition is not permitted by any of such covenants, the
fact that it would be permitted by an exception to, or would otherwise be within
the limitations of, another covenant shall not avoid the occurrence of a Default
or an Event of Default if such action is taken or condition exists. This
Agreement shall be binding upon and inure to the benefit of the Administrative
Agent and, Borrower and the Guarantors and their respective successors and
assigns. Neither Borrower nor any Guarantor shall, without the prior written
consent of the Administrative Agent given in accordance with the Credit
Agreement, assign any right, duty or obligation hereunder. This Agreement and
the other Credit Documents embody the entire agreement and understanding among
Borrower, the Guarantors and the Administrative Agent and supersede all prior
agreements and understandings between such parties relating to the subject
matter hereof and thereof. Accordingly, the Credit Documents may not be
contradicted by evidence of prior, contemporaneous or subsequent oral agreements
of the parties. There are no unwritten oral agreements between the parties. This
Agreement may be executed in one or more counterparts and by different parties
hereto in separate counterparts, each of which when so executed and delivered
shall be deemed an original, but all such counterparts together shall constitute
but one and the same instrument; signature pages may be detached from multiple
separate counterparts and attached to a single counterpart so that all signature
pages are physically attached to the same document. Delivery of an executed
counterpart to this Agreement by facsimile transmission or other electronic
transmission (such as .pdf or .tif) shall be effective as delivery of a manually
signed counterpart of this Agreement.

THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER SHALL BE
GOVERNED BY, AND SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE LAWS OF
THE STATE OF NEW YORK.

THE PROVISIONS OF THE CREDIT AGREEMENT UNDER THE HEADINGS “CONSENT TO
JURISDICTION” AND “WAIVER OF JURY TRIAL” ARE INCORPORATED HEREIN BY THIS
REFERENCE AND SUCH INCORPORATION SHALL SURVIVE ANY TERMINATION OF THE CREDIT
AGREEMENT.

SECTION 6. Additional Guarantors. Pursuant to Section 5.10 of the Credit
Agreement, each Person that is required to execute and deliver a Counterpart
Agreement, a Canadian Guarantee or a Barbados Guarantee (a “New Guarantor”)
shall also be required to enter into this Agreement as a Guarantor upon becoming
a Guarantor. Upon execution and delivery by the Administrative Agent and such
New Guarantor of an instrument in the form of Annex 1 hereto, such New Guarantor
shall become a Guarantor hereunder with the same force and effect as if
originally named as a Guarantor hereunder. The execution and delivery of any
instrument adding an additional New Guarantor as a party to this Agreement shall
not require the consent of Borrower or any Guarantor hereunder. The rights and
obligations of each Guarantor hereunder shall remain in full force and effect
notwithstanding the addition of any New Guarantor as a party to this Agreement.

[Signature Page Follows]

 

EXHIBIT L-3

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VALEANT PHARMACEUTICALS INTERNATIONAL By:  

 

  Name:   Title: VALEANT PHARMACEUTICALS INTERNATIONAL, INC. By:  

 

  Name:   Title: [GUARANTORS] By:  

 

  Name:   Title:

 

EXHIBIT L-4

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GOLDMAN SACHS LENDING PARTNERS LLC,

as Administrative Agent

By:  

 

  (Authorized Signatory)

 

EXHIBIT L-5

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ANNEX 1 TO

CONTRIBUTION AGREEMENT

SUPPLEMENT TO CONTRIBUTION AGREEMENT

SUPPLEMENT, dated as of [    ], among the New Guarantor[s] and the
Administrative Agent (this “Supplement”), to the Contribution Agreement, dated
as of June 29, 2011, among Valeant Pharmaceuticals International, a Delaware
corporation, Valeant Pharmaceuticals International, Inc., a corporation
continued under the federal laws of Canada, certain Subsidiaries of Valeant
Pharmaceuticals International, Inc., as Guarantors, and Goldman Sachs Lending
Partners LLC (“GSLP”), as Administrative Agent (as may be amended, restated,
replaced, supplemented or otherwise modified from time to time, the
“Contribution Agreement”).

Reference is made to the Third Amended and Restated Credit and Guaranty
Agreement, dated as of February 13, 2012 (as it may be amended, restated,
replaced, supplemented or otherwise modified from time to time, the “Credit
Agreement”), among Valeant Pharmaceuticals International, Inc., a corporation
continued under the federal laws of Canada (“Borrower”), certain Subsidiaries of
Borrower, as Guarantors, the Lenders party thereto from time to time, GSLP, J.P.
Morgan Securities LLC and Morgan Stanley Senior Funding, Inc. (“Morgan
Stanley”), as Joint Lead Arrangers and Joint Bookrunners, JPMorgan Chase Bank,
N.A. (“JPMorgan”) and Morgan Stanley, as Co-Syndication Agents, JPMorgan, as
Issuing Bank, GSLP, as Administrative Agent and Collateral Agent, and the other
Agents party thereto. Capitalized terms used herein and not otherwise defined
herein shall have the meanings assigned to such terms in the Credit Agreement
and the Contribution Agreement.

Borrower and the Guarantors have entered into the Contribution Agreement in
order to induce the Lenders to make Loans and the Issuing Bank to issue Letters
of Credit. Section 6 of the Contribution Agreement provides that additional New
Guarantors shall become Guarantors under the Contribution Agreement by execution
and delivery of an instrument in the form of this Supplement. The undersigned
New Guarantors are executing this Supplement in accordance with the requirements
of the Credit Agreement to become Guarantors under the Contribution Agreement in
order to induce the Lenders to make additional Loans and the Issuing Bank to
issue additional Letters of Credit and as consideration for Loans previously
made and Letters of Credit previously issued.

Accordingly, the Administrative Agent and the New Guarantor[s] agree as follows:

SECTION 1. In accordance with Section 6 of the Contribution Agreement, each New
Guarantor by its signature below becomes a Guarantor under the Contribution
Agreement with the same force and effect as if originally named therein as a
Guarantor and each New Guarantor hereby agrees to all the terms and provisions
of the Contribution Agreement applicable to it as a Guarantor thereunder. Each
reference to a “Guarantor” in the Contribution Agreement shall be deemed to
include the New Guarantors. The Contribution Agreement is hereby incorporated
herein by reference. Notwithstanding anything to the contrary in the
Contribution Agreement, the aggregate payment or distribution under all Credit
Documents of a Contributing Guarantor (as defined in the Contribution Agreement)
incorporated in Switzerland shall be limited in the same way as set forth for
the Guaranty of Swiss Guarantor in Section 7.13 of the Credit Agreement and the
aggregate payment or distribution under all Credit Documents of a Contributing
Guarantor incorporated in Luxembourg shall be limited in the same way as set
forth for the Guaranty of Luxembourg Guarantor in Section 7.4(g) of the Credit
Agreement.

 

EXHIBIT L-6

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SECTION 2. Each New Guarantor represents and warrants to the Administrative
Agent that this Supplement has been duly authorized, executed and delivered by
it and constitutes its legal, valid and binding obligation, enforceable against
it in accordance with its terms.

SECTION 3. This Supplement may be executed in counterparts (and by different
parties hereto on different counterparts), each of which shall constitute an
original, but all of which when taken together shall constitute a single
contract. This Supplement shall become effective when the Administrative Agent
shall have received a counterpart of this Supplement that bears the signature of
each New Guarantor and the Administrative Agent has executed a counterpart
hereof. Delivery of an executed signature page to this Supplement by facsimile
or other electronic transmission (such as “.pdf” or “.tif”) shall be effective
as delivery of a manually signed counterpart of this Supplement.

SECTION 4. Except as expressly supplemented hereby, the Contribution Agreement
shall remain in full force and effect.

SECTION 5. THIS SUPPLEMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES
HEREUNDER SHALL BE GOVERNED BY, AND SHALL BE CONSTRUED AND ENFORCED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK. THE PROVISIONS OF THE CREDIT
AGREEMENT UNDER THE HEADINGS “CONSENT TO JURISDICTION” AND “WAIVER OF JURY
TRIAL” ARE INCORPORATED HEREIN BY THIS REFERENCE AND SUCH INCORPORATION SHALL
SURVIVE ANY TERMINATION OF THE CREDIT AGREEMENT.

SECTION 6. In case anyone or more of the provisions contained in this Supplement
should be held invalid, illegal or unenforceable in any respect, the validity,
legality and enforceability of the remaining provisions contained herein and in
the Contribution Agreement shall not in any way be affected or impaired thereby
(it being understood that the invalidity of a particular provision in a
particular jurisdiction shall not in and of itself affect the validity of such
provision in any other jurisdiction). The parties hereto shall endeavor in
good-faith negotiations to replace the invalid, illegal or unenforceable
provisions with valid provisions the economic effect of which comes as close as
possible to that of the invalid, illegal or unenforceable provisions.

[Signature Page Follows]

 

EXHIBIT L-7

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[NEW GUARANTOR[S]] By:  

 

  Name:   Title:

 

EXHIBIT L-8

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GOLDMAN SACHS LENDING PARTNERS LLC,

as Administrative Agent

By:  

 

  (Authorized Signatory)

 

EXHIBIT L-9

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EXHIBIT M TO

THIRD AMENDED AND RESTATED CREDIT AND GUARANTY AGREEMENT

COLLATERAL QUESTIONNAIRE

[Provided under separate cover]

 

EXHIBIT M-1