Exhibit 10.2

 

SENIOR SECURED SUPER-PRIORITY

DEBTOR-IN-POSSESSION CREDIT AGREEMENT

 

Dated as of August 10, 2018 among

 

ARALEZ PHARMACEUTICALS US INC., POZEN INC., HALTON LABORATORIES LLC,

ARALEZ PHARMACEUTICALS MANAGEMENT INC., ARALEZ PHARMACEUTICALS
HOLDINGS LIMITED, ARALEZ PHARMACEUTICALS TRADING DESIGNATED ACTIVITY
COMPANY and ARALEZ PHARMACEUTICALS R&D INC., as the Borrowers

 

and

 

DEERFIELD MANAGEMENT COMPANY, L.P.,
as Administrative Agent,

 

and

 

THE LENDERS PARTY HERETO

 

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TABLE OF CONTENTS

 

ARTICLE I DEFINITIONS AND ACCOUNTING TERMS

 

1

 

 

 

 

1.1

Defined Terms

 

1

1.2

Other Interpretive Provisions

 

20

1.3

Accounting Terms

 

21

1.4

Rounding

 

22

1.5

Times of Day; Rates

 

22

 

 

 

 

ARTICLE II THE COMMITMENTS AND CREDIT EXTENSIONS

 

22

 

 

 

 

2.1

Loans

 

22

2.2

Borrowings, Conversions and Continuations of Loans

 

22

2.3

Administrative Priority

 

23

2.4

[Reserved]

 

23

2.5

Prepayments

 

23

2.6

[Reserved]

 

24

2.7

Repayment of Loans

 

24

2.8

Interest

 

24

2.9

Additional Consideration

 

25

2.10

Computation of Interest

 

25

2.11

Evidence of Debt

 

25

2.12

Payments Generally; Administrative Agent’s Claw back

 

25

2.13

Sharing of Payments by Lenders

 

26

2.14

Certain Bankruptcy Matters

 

27

 

 

 

 

ARTICLE III TAXES, YIELD PROTECTION AND ILLEGALITY

 

29

 

 

 

 

3.1

Taxes

 

29

3.2

[Reserved]

 

33

3.3

[Reserved]

 

33

3.4

Increased Costs

 

33

3.5

[Reserved]

 

34

3.6

[Reserved]

 

34

3.7

Survival

 

34

 

 

 

 

ARTICLE IV CONDITIONS PRECEDENT TO CREDIT EXTENSIONS

 

35

 

 

 

 

4.1

Conditions to Initial Credit Extension

 

35

4.2

Conditions of Credit Extension

 

36

 

 

 

 

ARTICLE V REPRESENTATIONS AND WARRANTIES

 

37

 

 

 

 

5.1

Existence, Qualification and Power

 

37

5.2

Authorization; No Contravention

 

37

5.3

Governmental Authorization; Other Consents

 

38

5.4

Binding Effect

 

38

5.5

Financial Statements; No Material Adverse Effect; Budget

 

38

5.6

Litigation

 

39

5.7

No Default

 

39

 

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5.8

Ownership of Property

 

39

5.9

Environmental Compliance

 

39

5.10

Insurance

 

40

5.11

Taxes

 

40

5.12

ERISA Compliance

 

40

5.13

Subsidiaries and Joint Ventures

 

41

5.14

Margin Regulations; Investment Company Act

 

41

5.15

Disclosure

 

42

5.16

Compliance with Laws

 

42

5.17

Intellectual Property; Licenses, Etc.

 

42

5.18

Capitalization

 

42

5.19

Perfection of Security Interests in the Collateral

 

43

5.20

Taxpayer Identification Number

 

43

5.21

OFAC

 

43

5.22

Anti-Corruption Laws

 

43

5.23

EEA Financial Institution

 

43

5.24

Administrative Priority; Lien Priority

 

43

5.25

Appointment of Trustee or Examiner; Liquidation

 

44

 

 

 

 

ARTICLE VI AFFIRMATIVE COVENANTS

 

44

 

 

 

 

6.1

Financial Statements

 

44

6.2

Certificates; Other Information

 

45

6.3

Notices

 

46

6.4

Payment of Taxes

 

47

6.5

Preservation of Existence, Etc.

 

47

6.6

Maintenance of Properties

 

47

6.7

Maintenance of Insurance

 

47

6.8

Compliance with Laws

 

48

6.9

Books and Records

 

48

6.10

Inspection Rights

 

48

6.11

Use of Proceeds

 

48

6.12

ERISA Compliance

 

49

6.13

Additional Guarantors

 

49

6.14

Pledged Assets

 

49

6.15

Maintenance of Depository Relationship

 

49

6.16

Anti-Corruption Laws and Sanctions

 

50

6.17

Account Control Agreements

 

50

6.18

Post-Closing Items

 

50

6.19

Case Milestones

 

50

6.20

Further Assurances

 

50

 

 

 

 

ARTICLE VII NEGATIVE COVENANTS

 

51

 

 

 

 

7.1

Liens

 

51

7.2

Investments

 

52

7.3

Indebtedness

 

53

7.4

Fundamental Changes

 

53

7.5

Dispositions

 

54

7.6

Restricted Payments

 

54

7.7

Change in Nature of Business

 

54

 

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7.8

Transactions with Affiliates

 

54

7.9

Burdensome Agreements

 

54

7.10

Use of Proceeds

 

55

7.11

Payments

 

55

7.12

Organization Documents; Fiscal Year; Legal Name, State of Formation and Form of
Entity

 

55

7.13

Sanctions

 

55

7.14

Anti-Corruption Laws

 

55

7.15

Astra Zeneca Documents

 

55

7.16

Financial Covenant

 

55

7.17

No Investment Company

 

56

7.18

Use of Property; Post-Filing Pleadings

 

56

7.19

Bankruptcy Court Orders; Administrative Priority; Lien Priority; Payment of
Claims

 

56

 

 

 

 

ARTICLE VIII EVENTS OF DEFAULT AND REMEDIES

 

56

 

 

 

 

8.1

Events of Default

 

56

8.2

Remedies Upon Event of Default

 

60

8.3

Application of Funds

 

61

 

 

 

 

ARTICLE IX ADMINISTRATIVE AGENT

 

62

 

 

 

 

9.1

Appointment and Authority

 

62

9.2

Rights as a Lender

 

62

9.3

Exculpatory Provisions

 

63

9.4

Reliance by Administrative Agent

 

63

9.5

Delegation of Duties

 

64

9.6

Resignation of Administrative Agent

 

64

9.7

Non-Reliance on Administrative Agent and Other Lenders

 

65

9.8

[Reserved]

 

65

9.9

Administrative Agent May File Proofs of Claim; Credit Bidding

 

65

9.10

Collateral and Guaranty Matters

 

66

 

 

 

 

ARTICLE X GUARANTY

 

67

 

 

 

 

10.1

The Guaranty

 

67

10.2

Obligations Unconditional

 

67

10.3

Reinstatement

 

68

10.4

Certain Additional Waivers

 

68

10.5

Remedies

 

68

10.6

Rights of Contribution

 

69

10.7

Guarantee of Payment; Continuing Guarantee

 

70

10.8

Limitation of Liability

 

70

 

 

 

 

ARTICLE XI MISCELLANEOUS

 

70

 

 

 

 

11.1

Amendments, Etc.

 

70

11.2

Notices; Effectiveness; Electronic Communications

 

72

11.3

No Waiver; Cumulative Remedies; Enforcement

 

73

11.4

Expenses; Indemnity; Damage Waiver

 

74

 

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11.5

Payments Set Aside

 

75

11.6

Successors and Assigns

 

76

11.7

Treatment of Certain Information; Confidentiality

 

78

11.8

Rights of Setoff

 

79

11.9

Interest Rate Limitation

 

79

11.10

Counterparts; Integration; Effectiveness

 

80

11.11

Survival of Representations and Warranties

 

80

11.12

Severability

 

80

11.13

Parties Including Trustees; Bankruptcy Court Proceedings

 

80

11.14

Governing Law; Jurisdiction; Etc.

 

81

11.15

Waiver of Jury Trial

 

82

11.16

No Advisory or Fiduciary Responsibility

 

82

11.17

Electronic Execution of Assignments and Certain Other Documents

 

83

11.18

USA PATRIOT Act Notice

 

83

11.19

Subordination of Intercompany Indebtedness

 

83

11.20

ENTIRE AGREEMENT

 

84

11.21

Acknowledgement and Consent to Bail-In of EEA Financial Institutions

 

84

 

SCHEDULES

 

1.1(a)

First Day Motions

 

 

2.1

Commitments and Applicable Percentages

 

 

6.18

Post-Closing Items

 

 

11.2

Certain Addresses for Notices

 

 

 

EXHIBITS

 

1.1(a)

Form of Closing Checklist

 

 

1.1(b)

Form of Interim Bankruptcy Court Order

 

 

2.2

Form of Loan Notice

 

 

2.5

Notice of Loan Prepayment

 

 

2.11

Form of Note

 

 

3.1

Forms of U.S. Tax Compliance Certificates

 

 

6.2

Form of Compliance Certificate

 

 

6.13

Form of Joinder Agreement

 

 

11.6-1

Form of Assignment and Assumption

 

 

11.6-2

Form of Administrative Questionnaire

 

 

 

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SENIOR SECURED SUPER-PRIORITY

DEBTOR-IN-POSSESSION CREDIT AGREEMENT

 

This SENIOR SECURED SUPER-PRIORITY DEBTOR-IN-POSSESSION CREDIT AGREEMENT is
entered into as of August 10, 2018 among ARALEZ PHARMACEUTICALS US INC., POZEN
INC., HALTON LABORATORIES LLC, ARALEZ PHARMACEUTICALS MANAGEMENT INC., ARALEZ
PHARMACEUTICALS HOLDINGS LIMITED, ARALEZ PHARMACEUTICALS TRADING DESIGNATED
ACTIVITY COMPANY, ARALEZ PHARMACEUTICALS R&D INC. (each a “Borrower” and
collectively, the “Borrowers”), the Lenders (defined herein) and DEERFIELD
MANAGEMENT COMPANY, L.P., a Delaware limited partnership (together with its
Affiliates, “Deerfield”), as Administrative Agent.

 

On August 10, 2018 (the “Petition Date”), the Borrowers commenced chapter 11
cases (collectively, the “Chapter 11 Case”) by filing separate voluntary
petitions for relief pursuant to chapter 11 of the Bankruptcy Code with the
United States Bankruptcy Court for the Southern District of New York (the
“Bankruptcy Court”).  The Borrowers have moved the Bankruptcy Court to order the
joint administration of the Chapter 11 Case.  The Borrowers intend to continue
to operate their businesses and manage their properties as debtors and
debtors-in-possession pursuant to Sections 1107(a) and 1108 of the Bankruptcy
Code.

 

The Borrowers have requested that the Lenders provide a senior secured,
super-priority debtor-in-possession credit facility in an aggregate principal
amount not to exceed Five Million Dollars ($5,000,000), all on a post-petition
basis and on the terms and conditions set forth herein.

 

The Lenders are willing to provide such financing only if, among other things,
(a) all of the Obligations hereunder and under the other Loan Documents
(i) constitute an allowed super-priority, administrative expense claim in the
Chapter 11 Case pursuant to section 364(c)(1) of the Bankruptcy Code, as more
particularly set forth herein and in the Bankruptcy Court Orders and (ii) are
secured by valid, perfected Liens on the Collateral to the extent set forth
herein, in the other Loan Documents and in the Bankruptcy Court Orders and
(b) the financing contemplated hereunder and the Loan Documents is authorized
and approved by the Bankruptcy Court Orders to be entered by the Bankruptcy
Court, and such Bankruptcy Court Orders are acceptable in form and substance to
the Administrative Agent and the Lenders in their sole discretion.

 

In consideration of the mutual covenants and agreements herein contained, the
parties hereto covenant and agree as follows:

 

ARTICLE I

 

DEFINITIONS AND ACCOUNTING TERMS

 

1.1                               Defined Terms.

 

As used in this Agreement, the following terms shall have the meanings set forth
below:

 

“Acquisition” means the acquisition by any Person, in a single transaction or in
a series of related transactions, of either (a) all or any substantial portion
of the property of, or a line of business or division of, another Person or
(b) at least a majority of the Voting Stock of another Person, in each case
whether or not involving a merger or consolidation with such other Person.

 

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“Administrative Agent” means Deerfield Management Company, L.P., a Delaware
limited partnership, in its capacity as administrative agent under any of the
Loan Documents, or any successor administrative agent.

 

“Administrative Agent’s Office” means the Administrative Agent’s address and, as
appropriate, account as set forth on Schedule 11.2 or such other address or
account as the Administrative Agent may from time to time notify to the
Borrowers and the Lenders.

 

“Administrative Questionnaire” means an Administrative Questionnaire in
substantially the form of Exhibit 11.6-2.

 

“Affiliate” means, with respect to a specified Person, another Person that
directly, or indirectly through one or more intermediaries, Controls or is
Controlled by or is under common Control with the Person specified.

 

“Agreement” means this Senior Secured Super-Priority Debtor-in-Possession Credit
Agreement, as amended, restated, supplemented or otherwise modified from time to
time.

 

“Applicable Bankruptcy Court Order” means (a) from the Interim Bankruptcy Court
Order Entry Date until the Final Bankruptcy Court Order Entry Date, the Interim
Bankruptcy Court Order, and (b) from and after the Final Bankruptcy Court Order
Entry Date, the Final Bankruptcy Court Order.

 

“Applicable Percentage” means with respect to any Lender at any time, the
percentage (carried out to the ninth decimal place) of the outstanding principal
amount of the Loans held by such Lender at such time. The initial Applicable
Percentage of each Lender is set forth opposite the name of such Lender on
Schedule 2.1 or in the Assignment and Assumption or other documentation pursuant
to which such Lender becomes a party hereto, as applicable.

 

“Applicable Rate” means 10.00% per annum.

 

“Approved Cash Management Arrangements” means cash management arrangements
satisfactory to the Administrative Agent and the Required Lenders in their sole
discretion.

 

“Approved Cash Management Order” means a cash management order satisfactory to
the Administrative Agent and the Required Lenders in their sole discretion
approving the Approved Cash Management Arrangements and directing the Borrowers
to comply therewith.

 

“Aralez Canadian DIP Credit Agreement” means the Senior Secured Super-Priority
Debtor-In-Possession Credit Agreement dated as of August 10, 2018 among Aralez
Pharmaceuticals, Inc., Aralez Pharmaceuticals Canada Inc., the lenders party
thereto and Deerfield Management Company, L.P., as Administrative Agent for the
lenders.

 

“Assignment and Assumption” means an assignment and assumption entered into by a
Lender and any assignee of such Lender in accordance with the provisions of
Section 11.6(b) in substantially the form of Exhibit 11.6-1.

 

“Astra Zeneca Documents” means that certain Supply Agreement, dated as of
October 31, 2016 (as amended from time to time prior to the date hereof), by and
between AstraZeneca AB and Aralez Pharmaceuticals Trading Designated Activity
Company.

 

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“Attributable Indebtedness” means, with respect to any Person on any date,
(a) in respect of any capital lease, the capitalized amount thereof that would
appear on a balance sheet of such Person prepared as of such date in accordance
with GAAP, (b) in respect of any Synthetic Lease Obligation, the capitalized
amount of the remaining lease payments under the relevant lease that would
appear on a balance sheet of such Person prepared as of such date in accordance
with GAAP if such lease were accounted for as a capital lease, (c) in respect of
any Securitization Transaction, the outstanding principal amount of such
financing, after taking into account reserve accounts and making appropriate
adjustments, determined by the Administrative Agent in its reasonable judgment
and (d) in respect of any Sale and Leaseback Transaction, the present value
(discounted in accordance with GAAP at the debt rate implied in the applicable
lease) of the obligations of the lessee for rental payments during the term of
such lease. In no event shall Attributable Indebtedness include operating leases
or any leases that would have been accounted for as operating leases under GAAP
on the Closing Date, but because of changes in GAAP following the Closing Date,
are accounted for as capital leases.

 

“Audited Financial Statements” means the audited consolidated balance sheet of
the Parent and its Subsidiaries as of December 31, 2017, and the related
consolidated statements of income or operations, shareholders’ equity and cash
flows of the Parent and its Subsidiaries for the fiscal year then ended,
including the notes thereto.

 

“Bail-In Action” means the exercise of any Write-Down and Conversion Powers by
the applicable EEA Resolution Authority in respect of any liability of an EEA
Financial Institution.

 

“Bail-In Legislation” means, with respect to any EEA Member Country implementing
Article 55 of Directive 2014/59/EU of the European Parliament and of the Council
of the European Union, the implementing law for such EEA Member Country from
time to time which is described in the EU Bail-In Legislation Schedule.

 

“Bankruptcy Code” means the Federal Bankruptcy Reform Act of 1978 (11 U.S.C.
§101, et seq.), as amended and in effect from time to time and the regulations
issued from time to time thereunder.

 

“Bankruptcy Court” has the meaning specified therefor in the recitals hereto.

 

“Bankruptcy Court Order Period” means the period of time (a) commencing on the
date that is the later of (i) the date when the Bankruptcy Court enters the
Interim Bankruptcy Court Order and (ii) the date that the Interim Bankruptcy
Court Order Entry Date Loan is made and (b) ending on the earliest of (i) the
date that is thirty-five (35) days after the Petition Date, unless the Final
Bankruptcy Court Order has been entered by the Bankruptcy Court on or prior to
such date, (ii) the date that the Chapter 11 Case is terminated or otherwise
ended, and (iii) the Maturity Date.

 

“Bankruptcy Court Order Period Cap” means One Million Dollars ($1,000,000).

 

“Bankruptcy Court Orders” means the Interim Bankruptcy Court Order and the Final
Bankruptcy Court Order.

 

“Borrower” and “Borrowers” have the meaning specified in the introductory
paragraph hereto.

 

“Borrower Representative” means Pozen Inc.

 

“Borrowing” means a borrowing consisting of simultaneous Loans.

 

3

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“Budget” means the budget for the Borrowers covering the 13-week period
commencing on the Petition Date on a weekly basis, which budget shall include,
at a minimum, detailed line-items setting forth the Borrowers’ accounts payable,
in the form required by the Interim Bankruptcy Court Order and in form
acceptable to the Administrative Agent in its sole discretion (it being
understood and agreed that any Budget substantially in the form of the initial
Budget delivered pursuant to Section 4.1(g) shall be acceptable to the
Administrative Agent).

 

“Business Day” means any day other than a Saturday, Sunday or other day on which
commercial banks are authorized to close under the Laws of, or are in fact
closed in, the state where the Administrative Agent’s Office is located.

 

“Carve-Out” has the meaning specified therefor in the Bankruptcy Court Orders.

 

“Case Milestones” means each of the following deadlines:  (a) entry of the
Interim Bankruptcy Court Order and the Approved Cash Management Order, each in
form and substance satisfactory to the Administrative Agent, by the fifth
Business Day following the Petition Date; (b) entry of the Final Bankruptcy
Court Order in form and substance satisfactory to the Administrative Agent
within thirty-five (35) days after the Petition Date; (c) Borrowers to file a
motion to sell all or substantially all of their assets in form and substance
satisfactory to the Administrative Agent within 25 days from the Petition Date;
(d) entry of an order approving the bidding and sales procedures, in each case,
in form and substance reasonably satisfactory to the Administrative Agent, by
the earlier of (i) 20 days following the formation of a Committee and (ii) 55
days after the Petition Date; (e) holding an auction for the sale of the
Borrowers’ assets by 90 days from the Petition Date; (f) entry of an order
approving such sale(s) by 95 days from the Petition Date; and (g) closing of
such sales by 110 days from the Petition Date.

 

“Cash Equivalents” means, as at any date, (a) securities issued or directly and
fully guaranteed or insured by the United States or any agency or
instrumentality thereof (provided that the full faith and credit of the United
States is pledged in support thereof) having maturities of not more than twelve
months from the date of acquisition, (b) Dollar denominated time deposits and
certificates of deposit of (i) any domestic commercial bank of recognized
standing having capital and surplus in excess of $500,000,000 or (ii) any bank
whose short term commercial paper rating from S&P is at least A-1 or the
equivalent thereof or from Moody’s is at least P-1 or the equivalent thereof
(any such bank being an “Approved Bank”), in each case with maturities of not
more than 270 days from the date of acquisition, (c) commercial paper and
variable or fixed rate notes issued by any Approved Bank (or by the parent
company thereof) or any variable rate notes issued by, or guaranteed by, any
domestic corporation rated A-1 (or the equivalent thereof) or better by S&P or
P-1 (or the equivalent thereof) or better by Moody’s and maturing within six
months of the date of acquisition, (d) repurchase agreements entered into by any
Person with a bank or trust company (including any of the Lenders) or recognized
securities dealer having capital and surplus in excess of $500,000,000 for
direct obligations issued by or fully guaranteed by the United States in which
such Person shall have a perfected first priority security interest (subject to
no other Liens) and having, on the date of purchase thereof, a fair market value
of at least 100% of the amount of the repurchase obligations and
(e) investments, classified in accordance with GAAP as current assets, in money
market investment programs registered under the Investment Company Act of 1940
which are administered by reputable financial institutions having capital of at
least $500,000,000 and the portfolios of which are limited to Investments of the
character described in the foregoing subdivisions (a) through (d).

 

“Change in Law” means the occurrence, after the Closing Date, of any of the
following:  (a) the adoption or taking effect of any Law, (b) any change in any
Law or in the administration, interpretation, implementation or application
thereof by any Governmental Authority or (c) the making or issuance of any
request, rule, guideline or directive (whether or not having the force of Law)
by any Governmental

 

4

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Authority; provided that notwithstanding anything herein to the contrary,
(i) the Dodd-Frank Wall Street Reform and Consumer Protection Act and all
requests, rules, guidelines or directives thereunder or issued in connection
therewith and (ii) all requests, rules, guidelines or directives promulgated by
the Bank for International Settlements, the Basel Committee on Banking
Supervision (or any successor or similar authority) or the United States or
foreign regulatory authorities, in each case pursuant to Basel III, shall in
each case be deemed to be a “Change in Law”, regardless of the date enacted,
adopted or issued.

 

“Change of Control” means an event or series of events by which:

 

(a)                                 any “person” or “group” (as such terms are
used in Sections 13(d) and 14(d) of the Securities Exchange Act of 1934, but
excluding any employee benefit plan of such person or its subsidiaries, and any
person or entity acting in its capacity as trustee, agent or other fiduciary or
administrator of any such plan) becomes the “beneficial owner” (as defined in
Rules 13d-3 and 13d-5 under the Securities Exchange Act of 1934, except that a
person or group shall be deemed to have “beneficial ownership” of all Equity
Interests that such person or group has the right to acquire, whether such right
is exercisable immediately or only after the passage of time (such right, an
“option right”)), directly or indirectly, of Voting Stock of Parent representing
35% or more of the combined voting power of all Voting Stock of Parent on a
fully diluted basis (and taking into account all such securities that such
person or group has the right to acquire pursuant to any option right); or

 

(b)                                 a majority of the members of the board of
directors or other equivalent governing body of any Borrower cease to be
composed of individuals (i) who were members of that board or equivalent
governing body on the Petition Date, (ii) whose appointment, election or
nomination to that board or equivalent governing body was approved by
individuals referred to in clause (i) above constituting at the time of such
election or nomination at least a majority of that board or equivalent governing
body or (iii) whose appointment, election or nomination to that board or other
equivalent governing body was approved by individuals referred to in clauses
(i) and (ii) above constituting at the time of such appointment, election or
nomination at least a majority of that board or equivalent governing body.

 

“Chapter 11 Case” has the meaning specified therefor in the recitals hereto.

 

“Closing Checklist” means that certain Closing Checklist attached as
Exhibit 1.1(a) hereto.

 

“Closing Date” means the date hereof.

 

“Collateral” means a collective reference to all property with respect to which
Liens in favor of the Administrative Agent, for the benefit of itself and the
Secured Parties, are purported to be granted pursuant to and in accordance with
the terms of the Loan Documents and the Bankruptcy Court Orders.

 

“Collateral Documents” means a collective reference to any security agreements
or notices and other security documents as may be executed and delivered by any
Loan Party pursuant to the terms of Section 6.14 or any of the Loan Documents.

 

“Commitment” means, as to each Lender, the Loan Commitment of such Lender.  The
Commitment of each Lender shall be automatically and permanently reduced without
further action on a dollar for dollar basis by the aggregate principal amount of
Loans advanced under this Agreement by such Lender from time to time.  Once
repaid, Loans may not be re-borrowed.

 

5

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“Committee” means any official committee of unsecured creditors appointed by the
United States Trustee for the Southern District of New York or approved by the
Bankruptcy Court in the Chapter 11 Case.

 

“Commodity Exchange Act” means the Commodity Exchange Act (7 U.S.C. § 1 et
seq.).

 

“Compliance Certificate” means a certificate substantially in the form of
Exhibit 6.2.

 

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

 

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

 

“Control” means the possession, directly or indirectly, of the power to direct
or cause the direction of the management or policies of a Person, whether
through the ability to exercise voting power, by contract or otherwise. 
“Controlling” and “Controlled” have meanings correlative thereto.  Without
limiting the generality of the foregoing, a Person shall be deemed to be
Controlled by another Person if such other Person possesses, directly or
indirectly, power to vote 10% or more of the securities having ordinary voting
power for the election of directors, managing general partners or the
equivalent.

 

“Credit Extension” means a Borrowing.

 

“Debt Issuance” means the issuance by any Loan Party or any Subsidiary of any
Indebtedness other than Indebtedness permitted under Section 7.3.

 

“Debtor Relief Laws” means the Bankruptcy Code of the United States, and all
other liquidation, conservatorship, bankruptcy, assignment for the benefit of
creditors, moratorium, rearrangement, receivership, insolvency, reorganization,
or similar debtor relief Laws of the United States or other applicable
jurisdictions from time to time in effect.

 

“Deerfield” has the meaning specified in the introductory paragraph hereto.

 

“Default” means any event or condition that constitutes an Event of Default or
that, with the giving of any notice, the passage of time, or both, would be an
Event of Default.

 

“Default Rate” means a rate per annum equal to two percent (2%) in excess of the
rate otherwise applicable thereto.

 

“Designated Jurisdiction” means any country or territory to the extent that such
country or territory itself is the subject of any Sanction.

 

“DIP Superpriority Claim” means the allowed superpriority administrative expense
claim granted to the Secured Parties in the Chapter 11 Case pursuant to
Section 364(c)(1) of the Bankruptcy Code for all of the Obligations with,
subject to the Carve-Out, priority over any and all administrative expense
claims and unsecured claims against the Loan Parties or their estates in any of
the Chapter 11 Case, at any time existing or arising, of any kind or nature
whatsoever, including administrative expenses of the kinds specified in or
ordered pursuant to Sections 105, 326, 328, 330, 331, 365, 503(a), 503(b),
507(a), 507(b), 546(c), 546(d), 726 (to the extent permitted by law), 1113, and
1114 of the Bankruptcy Code, and any

 

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other provision of the Bankruptcy Code, which shall at all times be senior to
the rights of the Loan Parties and their estates, and any successor trustee or
other estate representative.

 

“Disclosure Schedule Side Letter” means the Disclosure Schedule Side Letter
dated as of the Closing Date executed by the Loan Parties in favor of the
Administrative Agent and the Lenders.

 

“Disposition” or “Dispose” means the sale, transfer, license, lease or other
disposition of any property by any Loan Party or any Subsidiary, including any
Sale and Leaseback Transaction and any sale, assignment, transfer or other
disposal, with or without recourse, of any notes or accounts receivable or any
rights and claims associated therewith, but excluding any Recovery Event.

 

“Dollar” and “$” mean lawful money of the United States.

 

“EEA Financial Institution” means (a) any credit institution or investment firm
established in any EEA Member Country which is subject to the supervision of an
EEA Resolution Authority, (b) any entity established in an EEA Member Country
which is a parent of an institution described in clause (a) of this definition,
or (c) any financial institution established in an EEA Member Country which is a
subsidiary of an institution described in clauses (a) or (b) of this definition
and is subject to consolidated supervision with its parent.

 

“EEA Member Country” means any of the member states of the European
Union, Iceland, Liechtenstein, and Norway.

 

“EEA Resolution Authority” means any public administrative authority or any
person entrusted with public administrative authority of any EEA Member Country
(including any delegee) having responsibility for the resolution of any EEA
Financial Institution.

 

“Environmental Laws” means any and all federal, state, local and foreign
statutes, laws, regulations, ordinances, rules, judgments, orders, decrees,
permits, concessions, grants, franchises, licenses, agreements or governmental
restrictions relating to pollution and the protection of the environment or the
release of any materials into the environment, including those related to
hazardous substances or wastes, air emissions and discharges to waste or public
systems.

 

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

 

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

 

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“ERISA” means the Employee Retirement Income Security Act of 1974.

 

“ERISA Affiliate” means any trade or business (whether or not incorporated)
under common control with the Borrower within the meaning of Section 414(b) or
(c) of the Internal Revenue Code (and Sections 414(m) and (o) of the Internal
Revenue Code for purposes of provisions relating to Section 412 of the Internal
Revenue Code).

 

“ERISA Event” means (a) a Reportable Event with respect to a Pension Plan;
(b) the withdrawal of the Borrower or any ERISA Affiliate from a Pension Plan
subject to Section 4063 of ERISA during a plan year in which such entity was a
substantial employer (as defined in Section 4001(a)(2) of ERISA) or a cessation
of operations that is treated as such a withdrawal under Section 4062(e) of
ERISA; (c) a complete or partial withdrawal by the Borrower or any ERISA
Affiliate from a Multiemployer Plan or notification that a Multiemployer Plan is
insolvent (within the meaning of Section 4245 of ERISA); (d) the filing of a
notice of intent to terminate or the treatment of a Pension Plan or
Multiemployer Plan amendment as a termination under Section 4041 or 4041A of
ERISA, as applicable; (e) the institution by the PBGC of proceedings to
terminate a Pension Plan or a Multiemployer Plan; (f) any event or condition
which constitutes grounds under Section 4042 of ERISA for the termination of, or
the appointment of a trustee to administer, any Pension Plan or Multiemployer
Plan; (g) the determination that any Pension Plan is considered an at-risk plan
within the meaning of Section 430 of the Internal Revenue Code or Sections 303
of ERISA or any Multiemployer Plan is considered to be in endangered or critical
status within the meaning of Sections 431 and 432 of the Internal Revenue Code
or Sections 304 and 305 of ERISA, (h) the imposition of any liability under
Title IV of ERISA, other than for PBGC premiums due but not delinquent under
Section 4007 of ERISA, upon the Borrower or any ERISA Affiliate or (i) a failure
by the Borrower or any ERISA Affiliate to meet all applicable requirements under
the Pension Funding Rules in respect of a Pension Plan, whether or not waived,
or the failure by the Borrower or any ERISA Affiliate to make any required
contribution to a Multiemployer Plan.

 

“EU Bail-In Legislation Schedule” means the EU Bail-In Legislation Schedule
published by the Loan Market Association (or any successor person), as in effect
from time to time.

 

“Event of Default” has the meaning specified in Section 8.1.

 

“Exchange Act” means the Securities Exchange Act of 1934, as amended, together
with the rules and regulations promulgated thereunder.

 

“Excluded Property” means, with respect to any Loan Party, (a) any United States
intent-to-use trademark applications to the extent that, and solely during the
period in which, the grant of a security interest therein would impair the
validity or enforceability of such intent to use trademark applications under
applicable federal law, provided that upon submission and acceptance by the
United States Patent and Trademark Office of an amendment to allege use pursuant
to 15 U.S.C. Section 1060(a) (or any successor provision), such intent-to-use
trademark application shall be considered Collateral, and (b) any permit,
license or agreement entered into by any Loan Party to the extent that (i) such
permit, license or agreement or any Law prohibits the creation of a Lien
thereon, or (ii) such permit, license or agreement requires the consent of any
Person other than any Loan Party or Subsidiary (which has not been obtained) as
a condition to the creation of any Lien on such property.

 

“Excluded Subsidiary” means, as of any date of determination, (a) any Subsidiary
that is then prohibited by applicable Law from becoming a Guarantor, (b) any
Subsidiary that is then required to obtain the consent of any Governmental
Authority prior to becoming a Guarantor and such consent has not been obtained
after the use of commercially reasonable efforts by such Subsidiary to obtain
such consent, (c) any Subsidiary that is a Joint Venture if such Subsidiary is
not then permitted to become a

 

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Guarantor under the Organization Documents of such Subsidiary and (d) any
Subsidiary that is not a debtor under the Chapter 11 Case.

 

“Excluded Taxes” means any of the following Taxes imposed on or with respect to
any Recipient or required to be withheld or deducted from a payment to a
Recipient, (a) Taxes imposed on or measured by net income (however denominated),
franchise Taxes, and branch profits Taxes, in each case, (i) imposed as a result
of such Recipient being organized under the Laws of, or having its principal
office or, in the case of any Lender, its Lending Office located in, the
jurisdiction imposing such Tax (or any political subdivision thereof) or
(ii) that are Other Connection Taxes, (b) in the case of a Lender, U.S. federal
withholding Taxes imposed on amounts payable to or for the account of such
Lender with respect to an applicable interest in a Loan or Commitment pursuant
to a Law in effect on the date on which (i) such Lender acquires such interest
in the Loan or Commitment or (ii) such Lender changes its Lending Office, except
in each case to the extent that, pursuant to Section 3.1(a)(ii), 3.1(a)(iii) or
3.1(c), amounts with respect to such Taxes were payable either to such Lender’s
assignor immediately before such Lender became a party hereto or to such Lender
immediately before it changed its Lending Office, (c) Taxes attributable to such
Recipient’s failure to comply with Section 3.1(e) other than as a result of a
change in Law occurring subsequent to the date such Recipient became a party to
this Agreement, and (d) any withholding Taxes imposed pursuant to FATCA.

 

“Extension Fee” has the meaning specified in Section 2.9(b).

 

“Facility Termination Date” means the date as of which all of the following are
satisfied:  (a) all Obligations have been paid in full (other than contingent
indemnification obligations for which no claim has been made) in cash in
accordance with the terms of this Agreement and the other Loan Documents,
(b) all obligations or requirements of any Secured Party to extend credit under
any Loan Document have been terminated and (c) all Loan Documents have
terminated in accordance with their terms.

 

“FASB ASC” means the Accounting Standards Codification of the Financial
Accounting Standards Board.

 

“FATCA” means Sections 1471 through 1474 of the Internal Revenue Code, as of the
Closing Date (or any amended or successor version that is substantively
comparable and not materially more onerous to comply with), any current or
future regulations or official interpretations thereof and any agreements
entered into pursuant to Section 1471(b)(1) of the Internal Revenue Code and any
fiscal or regulatory legislation, rules or practices adopted pursuant to any
intergovernmental agreement, treaty or convention among the Governmental
Authorities implementing such sections of the Internal Revenue Code.

 

“Federal Flow Through Entity” has the meaning specified in the definition of
“Flow Through Entity”.

 

“Federal Funds Rate” means, for any day, the rate per annum equal to the
weighted average of the rates on overnight federal funds transactions with
members of the Federal Reserve System, as published by the Federal Reserve Bank
of New York on the Business Day next succeeding such day; provided that (a) 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 (b) if no such rate is so
published on such next succeeding Business Day, the Federal Funds Rate for such
day shall be the average rate (rounded upward, if necessary, to a whole multiple
of 1/100 of 1%) charged to a financial institution selected by the
Administrative Agent on such day on such transactions as determined by the
Administrative Agent.

 

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“Final Bankruptcy Court Order” means the final order entered on the docket of
the Bankruptcy Court with respect to the Loan Parties and the Chapter 11 Case,
substantially in the form of the Interim Bankruptcy Court Order and acceptable
to the Administrative Agent in its sole discretion, as the same may be amended,
modified or supplemented from time to time with the express written joinder or
consent of the Administrative Agent and the Required Lenders, which order shall
not have been vacated, reversed or stayed.

 

“Final Bankruptcy Court Order Entry Date” means the date on which the Final
Bankruptcy Court Order shall have been entered by the Bankruptcy Court.

 

“First Day Motions” means the motions listed on Schedule 1.1(a) attached hereto.

 

“First Day Orders” means such orders of the Bankruptcy Court (other than the
Bankruptcy Court Orders) authorizing and approving the First Day Motions.

 

“Flow Through Entity” means an entity that (a) for federal income tax purposes
constitutes (i) a “partnership” (within the meaning the Internal Revenue Code)
other than a “publicly traded partnership” (as defined in Section 7704 of the
Internal Revenue Code) treated as a corporation under Section 7704(a) of the
Internal Revenue Code, or (ii) any other business entity that is disregarded as
an entity separate from its owners for U.S. federal income tax purposes (each of
the entities described in the preceding clauses (i) and (ii), a “Federal Flow
Through Entity”), and (b) for state and local jurisdictions is subject to
treatment on a basis under applicable state or local income tax law
substantially similar to a Federal Flow Through Entity.

 

“Foreign Lender” means (a) if the Borrower is a U.S. Person, a Lender that is
not a U.S. Person, and (b) if the Borrower is not a U.S. Person, a Lender that
is resident or organized under the Laws of a jurisdiction other than that in
which the Borrower is resident for tax purposes.  For purposes of this
definition, the United States, each State thereof and the District of Columbia
shall be deemed to constitute a single jurisdiction.

 

“FRB” means the Board of Governors of the Federal Reserve System of the United
States.

 

“Fund” means any Person (other than a natural Person) that is (or will be)
engaged in making, purchasing, holding or otherwise investing in commercial
loans and similar extensions of credit in the ordinary course of its activities.

 

“GAAP” means generally accepted accounting principles in the United States set
forth in the opinions and pronouncements of the Accounting Principles Board and
the American Institute of Certified Public Accountants and statements and
pronouncements of the Financial Accounting Standards Board (or agencies with
similar functions of comparable stature and authority within the accounting
profession), consistently applied.

 

“Governmental Authority” means the government of the United States or any other
nation, or of any political subdivision thereof, whether state or local, and any
agency, authority, instrumentality, regulatory body, court, central bank or
other entity exercising executive, legislative, judicial, taxing, regulatory or
administrative powers or functions of or pertaining to government (including any
supra- national bodies such as the European Union or the European Central Bank).

 

“Guarantee” means, as to any Person, (a) any obligation, contingent or
otherwise, of such Person guaranteeing or having the economic effect of
guaranteeing any Indebtedness or other obligation payable or performable by
another Person (the “primary obligor”) in any manner, whether directly or
indirectly,

 

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and including any obligation of such Person, direct or indirect, (i) to purchase
or pay (or advance or supply funds for the purchase or payment of) such
Indebtedness or other obligation, (ii) to purchase or lease property, securities
or services for the purpose of assuring the obligee in respect of such
Indebtedness or other obligation of the payment or performance of such
Indebtedness or other obligation, (iii) to maintain working capital, equity
capital or any other financial statement condition or liquidity or level of
income or cash flow of the primary obligor so as to enable the primary obligor
to pay such Indebtedness or other obligation, or (iv) entered into for the
purpose of assuring in any other manner the obligee in respect of such
Indebtedness or other obligation of the payment or performance thereof or to
protect such obligee against loss in respect thereof (in whole or in part), or
(b) any Lien on any assets of such Person securing any Indebtedness or other
obligation of any other Person, whether or not such Indebtedness or other
obligation is assumed by such Person (or any right, contingent or otherwise, of
any holder of such Indebtedness to obtain any such Lien). The amount of any
Guarantee shall be deemed to be an amount equal to the stated or determinable
amount of the related primary obligation, or portion thereof, in respect of
which such Guarantee is made or, if not stated or determinable, the maximum
reasonably anticipated liability in respect thereof as determined by the
guaranteeing Person in good faith.  The term “Guarantee” as a verb has a
corresponding meaning.

 

“Guarantors” means, collectively, (a) each Borrower, (b) each Person that joins
as a Guarantor pursuant to Section 6.13 or otherwise and (c) the successors and
permitted assigns of the foregoing.

 

“Guaranty” means the Guaranty made by the Guarantors in favor of the
Administrative Agent and the other holders of the Obligations pursuant to
Article X.

 

“Hazardous Materials” means all explosive or radioactive substances or wastes
and all hazardous or toxic substances, wastes or other pollutants, including
petroleum or petroleum distillates, asbestos or asbestos-containing materials,
polychlorinated biphenyls, radon gas, infectious or medical wastes and all other
substances or wastes of any nature regulated pursuant to any Environmental Law.

 

“IFRS” means international accounting standards within the meaning of IAS
Regulation 1606/2002 to the extent applicable to the relevant financial
statements delivered under or referred to herein.

 

“Indebtedness” means, as to any Person at a particular time, without
duplication, all of the following, whether or not included as indebtedness or
liabilities in accordance with GAAP:

 

(a)                                 all obligations for borrowed money and all
obligations of such Person evidenced by bonds, debentures, notes, loan
agreements or other similar instruments;

 

(b)                                 the maximum amount available to be drawn
under letters of credit (including standby and commercial), bankers’
acceptances, bank guaranties, surety bonds and similar instruments;

 

(c)                                  the Swap Termination Value of any Swap
Contract;

 

(d)                                 all obligations to pay the deferred purchase
price of property or services (other than trade accounts payable in the ordinary
course of business);

 

(e)                                  indebtedness (excluding prepaid interest
thereon) secured by a Lien on property owned or being purchased by such Person
(including indebtedness arising under conditional sales or other title retention
agreements), whether or not such indebtedness shall have been assumed by such
Person or is limited in recourse;

 

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(f)                                   all Attributable Indebtedness;

 

(g)                                  all obligations to purchase, redeem,
retire, defease or otherwise make any payment prior to the Maturity Date or Term
in respect of any Equity Interests or any warrant, right or option to acquire
such Equity Interest, valued, in the case of a redeemable preferred interest, at
the greater of its voluntary or involuntary liquidation preference plus accrued
and unpaid dividends;

 

(h)                                 all Guarantees of such Person in respect of
any of the foregoing; and

 

(i)                                     all Indebtedness of the types referred
to in clauses (a) through (h) above of any partnership or joint venture (other
than a joint venture that is itself a corporation or limited liability company)
in which such Person is a general partner or joint venturer, unless such
Indebtedness is expressly made non-recourse to such Person.

 

In no event shall Indebtedness include operating leases or any leases that would
have been accounted for as operating leases under GAAP on the Closing Date, but
because of changes in GAAP following the Closing Date, are accounted for as
capital leases.

 

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

 

“Indemnitee” has the meaning specified in Section 11.4(b).

 

“Information” has the meaning specified in Section 11.7.

 

“Interest Payment Date” means the last Business Day of each March, June,
September and December and the Maturity Date.

 

“Interim Bankruptcy Court Order” means the order of the Bankruptcy Court as
entered on the docket of the Bankruptcy Court with respect to the Loan Parties
and the Chapter 11 Case substantially in the form of Exhibit 1.1(b) hereto, as
the same may be amended, modified or supplemented from time to time with the
express written joinder or consent of the Administrative Agent and the Required
Lenders.

 

“Interim Bankruptcy Court Order Entry Date” means the date on which the Interim
Bankruptcy Court Order shall have been entered by the Bankruptcy Court.

 

“Interim Bankruptcy Court Order Entry Date Loan” has the meaning specified in
Section 2.1(a).

 

“Interim Bankruptcy Court Order Entry Date Loan Amount” means an amount
requested by Borrowers not to exceed the Bankruptcy Court Order Period Cap.

 

“Interim Bankruptcy Court Order Period” means the period of time from the time
at which the Bankruptcy Court enters the Interim Bankruptcy Court Order until
the time at which the Bankruptcy Court enters the Final Bankruptcy Court Order.

 

“Internal Revenue Code” means the Internal Revenue Code of 1986.

 

“Investment” means, as to any Person, any direct or indirect acquisition or
investment by such Person, whether by means of (a) the purchase or other
acquisition of Equity Interests of another Person,

 

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(b) a loan, advance or capital contribution to, Guarantee or assumption of debt
of, or purchase or other acquisition of any other debt or equity participation
or interest in, another Person, including any partnership or joint venture
interest in such other Person (provided that Investment includes amounts shown
on the Borrower’s consolidated statements of cash flows as investments in
unconsolidated joint ventures), or (c) an Acquisition. For purposes of covenant
compliance, the amount of any Investment shall be the amount actually invested,
without adjustment for subsequent increases or decreases in the value of such
Investment.

 

“IP Rights” has the meaning specified in Section 5.17.

 

“IRS” means the United States Internal Revenue Service.

 

“Joinder Agreement” means a joinder agreement substantially in the form of
Exhibit 6.13 executed and delivered by a Subsidiary in accordance with the
provisions of Section 6.13 or any other documents as the Administrative Agent
shall deem appropriate for such purpose.

 

“Joint Venture” means any Person in which any Borrower owns Equity Interests
other than any Wholly Owned Subsidiary.

 

“Laws” means, collectively, all international, foreign, federal, state and local
statutes, treaties, rules, guidelines, regulations, ordinances, codes and
administrative or judicial precedents or authorities, including the
interpretation or administration thereof by any Governmental Authority charged
with the enforcement, interpretation or administration thereof, and all
applicable administrative orders, directed duties, requests, licenses,
authorizations and permits of, and agreements with, any Governmental Authority,
in each case whether or not having the force of Law; provided that, for purposes
of Section 3.1, the defined term “Laws” shall include FATCA.

 

“Lenders” means each of the Persons identified as a “Lender” on the signature
pages hereto, each other Person that becomes a “Lender” in accordance with this
Agreement and their successors and assigns.

 

“Lending Office” means, as to any Lender, the office or offices of such Lender
described as such in such Lender’s Administrative Questionnaire, or such other
office or offices as a Lender may from time to time notify the Borrowers and the
Administrative Agent, which office may include any Affiliate of such Lender or
any domestic or foreign branch of such Lender or such affiliate.  Unless the
context otherwise requires each references to a Lender shall include its
applicable Lending Office.

 

“Lien” means any mortgage, pledge, hypothecation, assignment, deposit
arrangement, encumbrance, lien (statutory or other), charge, or preference,
priority or other security interest or preferential arrangement in the nature of
a security interest of any kind or nature whatsoever (including any conditional
sale or other title retention agreement, any easement, right of way or other
encumbrance on title to real property, and any financing lease having
substantially the same economic effect as any of the foregoing).

 

“Loan” means an extension of credit by a Lender to the Borrowers under
Article II from time to time, including the Interim Bankruptcy Court Order Entry
Date Loan and the loans mentioned in Section 2.1(b).

 

“Loan Commitment” means, as to each Lender, its obligation to make its portion
of the Loans to the Borrower pursuant to Section 2.1(a) and Section 2.1(b), in
the principal amount set forth opposite

 

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such Lender’s name on Schedule 2.1.  The aggregate principal amount of the Loan
Commitments of all of the Lenders as in effect on the Closing Date is
$5,000,000.

 

“Loan Documents” means this Agreement, each Note, each Joinder Agreement, the
Collateral Documents and each other agreement, instrument or document related to
this Agreement or any transaction contemplated hereby or thereby.

 

“Loan Notice” means a notice of a Borrowing of the Loans pursuant to
Section 2.2(a), which shall be substantially in the form of Exhibit 2.2 or such
other form as may be approved by the Administrative Agent (including any form on
an electronic transmission system as shall be approved by the Administrative
Agent) appropriately completed and signed by a Responsible Officer of the
Borrower Representative.

 

“Loan Parties” means, collectively, each Borrower and each Guarantor.

 

“Master Agreement” has the meaning specified in the definition of “Swap
Contract.”

 

“Material Adverse Effect” means (a) a material adverse change in, or a material
adverse effect upon, the operations, business, assets, properties, liabilities
(actual or contingent) or financial condition of the Loan Parties and their
Subsidiaries taken as a whole; (b) a material impairment of the rights and
remedies of the Administrative Agent or any Lender under any Loan Document, or
of the ability of any Loan Party to perform its obligations under any Loan
Document to which it is a party; or (c) a material adverse effect upon the
legality, validity, binding effect or enforceability against any Loan Party of
any Loan Document to which it is a party.  Notwithstanding anything herein to
the contrary, the act of filing the Chapter 11 Case, and effects typically
resulting therefrom, shall not in and of itself constitute a Material Adverse
Effect.

 

“Maturity Date” means the date which is the earliest of (a) the last day of the
Term (the “Stated Maturity Date”), as such date may be extended in accordance
with Section 2.15, (b) the date of the substantial consummation (as defined in
Section 1101(2) of the Bankruptcy Code) of a plan of reorganization in the
Chapter 11 Case that has been confirmed by an order of the Bankruptcy Court,
(c) the date of a sale of all or substantially all of the assets of the
Borrowers, (d) the conversion of the Chapter 11 Case to a proceeding under
Chapter 7 of the Bankruptcy Code, (e) an order is entered by the Bankruptcy
Court dismissing the Chapter 11 Case, which does not contain a provision for
termination of this Agreement and the Commitments and payment in full of the
Obligations hereunder and under the other Loan Documents and the occurrence of
the Facility Termination Date prior to such dismissal and (f) such earlier date
on which all Loans and other Obligations for the payment of money shall become
due and payable in accordance with the terms of this Agreement and the other
Loan Documents (including pursuant to any acceleration of any Loans or
Obligations upon the occurrence of an Event of Default); provided, however, that
if such date is not a Business Day, the Maturity Date shall be the next
preceding Business Day.

 

“Moody’s” means Moody’s Investors Service, Inc. and any successor thereto.

 

“Multiemployer Plan” means any employee benefit plan of the type described in
Section 4001(a)(3) of ERISA, that is either covered by Title IV of ERISA or is
subject to the minimum funding standards under Section 412 of the Internal
Revenue Code, and to which the Borrower or any ERISA Affiliate makes or is
obligated to make contributions, or during the preceding five plan years, has
made or been obligated to make contributions.

 

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“Multiple Employer Plan” means a Pension Plan which has two or more contributing
sponsors (including the Borrower or any ERISA Affiliate) at least two of whom
are not under common control, as such a plan is described in Section 4064 of
ERISA.

 

“Net Cash Proceeds” means the aggregate cash or Cash Equivalents proceeds
received by any Loan Party or any Subsidiary in respect of any Disposition, Debt
Issuance or Recovery Event, net of (a) direct costs incurred in connection
therewith (including legal, accounting and investment banking fees, and sales
commissions), (b) taxes paid or payable as a result thereof and (c) in the case
of any Disposition or any Recovery Event, the amount necessary to retire any
Indebtedness secured by a Permitted Lien on the related property; it being
understood that “Net Cash Proceeds” shall include any cash or Cash Equivalents
received upon the sale or other disposition of any non-cash consideration
received by any Loan Party or any Subsidiary in any Disposition, Debt Issuance
or Recovery Event.

 

“Note” has the meaning specified in Section 2.11.

 

“Notice of Loan Prepayment” means a notice of prepayment with respect to a Loan,
which shall be substantially in the form of Exhibit 2.5 or such other form as
may be approved by the Administrative Agent (including any form on an electronic
transmission system as shall be approved by the Administrative Agent),
appropriately completed and signed by a Responsible Officer.

 

“Obligations” means with respect to the each Loan Party all advances to, and
debts, liabilities, obligations, covenants and duties of, any Loan Party to the
Administrative Agent or Lenders arising under any Loan Document or otherwise
with respect to any Loan, and, in each case, whether direct or indirect
(including those acquired by assumption), absolute or contingent, due or to
become due, now existing or hereafter arising and including interest and fees
that accrue after the commencement by or against any Loan Party of any
proceeding under any Debtor Relief Laws naming such Person as the debtor in such
proceeding, regardless of whether such interest and fees are allowed claims in
such proceeding.

 

“OFAC” means the Office of Foreign Assets Control of the United States
Department of the Treasury.

 

“Organization Documents” means, (a) with respect to any corporation, the
certificate or articles of incorporation and the bylaws (or equivalent or
comparable constitutive documents with respect to any non-U.S. jurisdiction);
(b) with respect to any limited liability company, the certificate or articles
of formation or organization and operating agreement or limited liability
company agreement (or equivalent or comparable documents with respect to any
non-U.S. jurisdiction); (c) with respect to any partnership, joint venture,
trust or other form of business entity, the partnership, joint venture or other
applicable agreement of formation or organization (or equivalent or comparable
documents with respect to any non-U.S. jurisdiction) and (d) with respect to all
entities, any agreement, instrument, filing or notice with respect thereto filed
in connection with its formation or organization with the applicable
Governmental Authority in the jurisdiction of its formation or organization (or
equivalent or comparable documents with respect to any non-U.S. jurisdiction).

 

“Other Connection Taxes” means, with respect to any Recipient, Taxes imposed as
a result of a present or former connection between such Recipient and the
jurisdiction imposing such Tax (other than connections arising solely 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 transaction pursuant to or enforced any
Loan Document, or sold or assigned an interest in any Loan or Loan Document).

 

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“Other Taxes” means all present or future stamp, court or documentary,
intangible, recording, filing or similar Taxes that arise from any payment made
under, from the execution, delivery, performance, enforcement or registration
of, from the receipt or perfection of a security interest under, or otherwise
with respect to, any Loan Document.

 

“Parent” means Aralez Pharmaceuticals Inc.

 

“Participant” has the meaning specified in Section 11.6(d).

 

“Participant Register” has the meaning specified in Section 11.6(d).

 

“PBGC” means the Pension Benefit Guaranty Corporation.

 

“Pension Act” means the Pension Protection Act of 2006.

 

“Pension Funding Rules” means the rules of the Internal Revenue Code and ERISA
regarding minimum required contributions (including any installment payment
thereof) to Pension Plans and set forth in, with respect to plan years ending
prior to the effective date of the Pension Act, Section 412 of the Internal
Revenue Code and Section 302 of ERISA, each as in effect prior to the Pension
Act and, thereafter, Section 412, 430 and 436 of the Internal Revenue Code and
Section 302 of ERISA.

 

“Pension Plan” means any employee pension benefit plan (including a Multiple
Employer Plan but excluding a Multiemployer Plan) that is maintained or is
contributed to by the Borrower and any ERISA Affiliate and is either covered by
Title IV of ERISA or is subject to the minimum funding standards under
Section 412 of the Internal Revenue Code.

 

“Permitted Liens” means, at any time, Liens in respect of property of any Loan
Party or any Subsidiary permitted to exist at such time pursuant to the terms of
Section 7.1.

 

“Permitted Transfers” means: (a) Dispositions of inventory in the ordinary
course of business; (b) Dispositions of property to a Borrower or any
Subsidiary; provided that (i) such Disposition is permitted by the Bankruptcy
Court Orders, (ii) if the transferor of such property is a Borrower then the
transferee thereof must be a Borrower, and (iii) if the transferor of such
property is a Loan Party then the transferee thereof must be a Loan Party;
(c) Dispositions of accounts receivable in connection with the collection or
compromise thereof in accordance with the Bankruptcy Court Orders;
(d) Dispositions of machinery and equipment and the abandonment of intellectual
property no longer used or useful in the conduct of business of the Loan Parties
and their Subsidiaries that are Disposed of in the ordinary course of business
and in accordance with the Bankruptcy Court Orders; (e) licenses, sublicenses,
leases or subleases granted to others not interfering in any material respect
with the business of the Loan Parties and their Subsidiaries, in each case, that
are in accordance with the Bankruptcy Court Orders; and (f) the sale or
disposition of Cash Equivalents in accordance with the Bankruptcy Court Orders.

 

“Person” means any natural person, corporation, limited liability company,
trust, joint venture, association, company, partnership, Governmental Authority
or other entity.

 

“Petition Date” has the meaning specified therefor in the recitals hereto.

 

“Plan” means any employee benefit plan within the meaning of Section 3(3) of
ERISA (including a Pension Plan, but excluding any Multiemployer Plan),
maintained for employees of the Borrower or any ERISA Affiliate or any such Plan
to which the Borrower or any ERISA Affiliate is required to contribute on behalf
of any of its employees.

 

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“Prepetition Credit Facility” means that certain Second Amended and Restated
Facility Agreement, dated as of December 7, 2015, by and among Parent, the other
Persons party thereto from time to time, and the Prepetition Lenders party
thereto, as amended, restated, supplemented or otherwise modified on or prior to
the Petition Date.

 

“Prepetition Credit Facility Debt” means the “Obligations” as defined in the
Prepetition Credit Facility.

 

“Prepetition Debt Documents” means “Loan Documents” as defined in the
Prepetition Credit Facility.

 

“Prepetition Lender” means any lender providing the Prepetition Credit Facility
Debt under the Prepetition Credit Facility (including the “Lenders” (as defined
in the Prepetition Credit Facility)).

 

“Prepetition Secured Parties” means the Prepetition Lenders and any other holder
of any Prepetition Credit Facility Debt.

 

“Professional Fees and Expenses” has the meaning specified in the Interim
Bankruptcy Court Order.

 

“Recipient” means the Administrative Agent, any Lender, or any other recipient
of any payment to be made by or on account of any obligation of any Loan Party
hereunder.

 

“Recovery Event” means any loss of, damage to or destruction of, or any
condemnation or other taking for public use of, any property of any Loan Party
or any Subsidiary.

 

“Register” has the meaning specified in Section 11.6(c).

 

“Related Indemnified Person” shall mean, with respect to an Indemnitee, (x) any
controlling person or controlled affiliate of such Indemnitee, (y) the officers,
directors or employees of such Indemnitee or any of its controlling persons or
controlled affiliates and (z) the agents, advisors and other representatives of
such Indemnitee or any of its controlling persons or controlled affiliates, in
the case of this clause (z), acting on behalf of, or at the express instructions
of, such Indemnitee, controlling person or such controlled affiliate; provided
that each reference to a controlling person, controlled affiliate, director,
officer or employee in this definition pertains to a controlling person,
controlled affiliate, director, officer or employee involved in the negotiation
or administration of this Agreement.

 

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

 

“Reportable Event” means any of the events set forth in Section 4043(c) of
ERISA, other than events for which the thirty-day notice period has been waived.

 

“Request for Credit Extension” means with respect to a Borrowing, a Loan Notice.

 

“Required Lenders” means, at any time, Lenders having Total Credit Exposures
representing more than 50% of the Total Credit Exposures of all Lenders.

 

“Resignation Effective Date” has the meaning specified in Section 9.6.

 

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“Responsible Officer” means the chief executive officer, president, chief
financial officer, treasurer, assistant treasurer or controller of a Loan Party,
and, solely for purposes of the delivery of incumbency certificates, the
secretary or any assistant secretary of a Loan Party and, solely for purposes of
notices given pursuant to Article II, any other officer or employee of the
applicable Loan Party so designated by any of the foregoing officers in a notice
to the Administrative Agent or any other officer or employee of the applicable
Loan Party designated in or pursuant to an agreement between the applicable Loan
Party and the Administrative Agent. Any document delivered hereunder that is
signed by a Responsible Officer of a Loan Party shall be conclusively presumed
to have been authorized by all necessary corporate, partnership and/or other
action on the part of such Loan Party and such Responsible Officer shall be
conclusively presumed to have acted on behalf of such Loan Party.  To the extent
requested by the Administrative Agent, each Responsible Officer will provide an
incumbency certificate and appropriate authorization documentation, in form and
substance reasonably satisfactory to the Administrative Agent.

 

“Restricted Payment” means any dividend or other distribution (whether in cash,
securities or other property) with respect to any Equity Interests of any
Person, or any payment (whether in cash, securities or other property),
including any sinking fund or similar deposit, on account of the purchase,
redemption, retirement, defeasance, acquisition, cancellation or termination of
any such Equity Interests or on account of any return of capital to such
Person’s stockholders, partners or members (or the equivalent Person thereof),
or any option, warrant or other right to acquire any such dividend or other
distribution or payment.

 

“S&P” means Standard & Poor’s Financial Services LLC, a subsidiary of The McGraw
Hill Companies, Inc. and any successor thereto.

 

“Sale and Leaseback Transaction” means, with respect to any Person, any
arrangement, directly or indirectly, whereby such Person shall sell or transfer
any property used or useful in its business, whether now owned or hereafter
acquired, and thereafter rent or lease such property or other property that it
intends to use for substantially the same purpose or purposes as the property
being sold or transferred.

 

“Sanction(s)” means any sanction administered or enforced by the United States
Government, including OFAC, the United Nations Security Council, the European
Union, Her Majesty’s Treasury (“HMT”) or other relevant sanctions authority.

 

“SEC” means the Securities and Exchange Commission, or any Governmental
Authority succeeding to any of its principal functions.

 

“Secured Parties” means the Administrative Agent, each Lender, any Indemnitee
and any other holder of any Obligations.

 

“Securities Act” means the Securities Act of 1933, as amended, and the rules and
regulations promulgated thereunder.

 

“Securitization Transaction” means, with respect to any Person, any financing
transaction or series of financing transactions (including factoring
arrangements) pursuant to which such Person or any Subsidiary of such Person may
sell, convey or otherwise transfer, or grant a security interest in, accounts,
payments, receivables, rights to future lease payments or residuals or similar
rights to payment to a special purpose subsidiary or affiliate of such Person.

 

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“Security Agreement” means the Senior Secured Super-Priority
Debtor-in-Possession Security and Pledge Agreement, dated as of the Closing
Date, executed in favor of the Administrative Agent for the benefit of the
Secured Parties by each of the Loan Parties.

 

“Stated Maturity Date” has the meaning specified in the definition of “Maturity
Date.”

 

“Subsidiary” of a Person means a corporation, partnership, joint venture,
limited liability company or other business entity of which a majority of the
shares of Voting Stock is at the time beneficially owned, directly, or
indirectly through one or more intermediaries, or both, by such Person.  Unless
otherwise specified, all references herein to a “Subsidiary” or to
“Subsidiaries” shall refer to a Subsidiary or Subsidiaries of the Borrower.

 

“Swap Contract” means (a) any and all rate swap transactions, basis swaps,
credit derivative transactions, forward rate transactions, commodity swaps,
commodity options, forward commodity contracts, equity or equity index swaps or
options, bond or bond price or bond index swaps or options or forward bond or
forward bond price or forward bond index transactions, interest rate options,
forward foreign exchange transactions, cap transactions, floor transactions,
collar transactions, currency swap transactions, cross-currency rate swap
transactions, currency options, spot contracts, or any other similar
transactions or any combination of any of the foregoing (including any options
to enter into any of the foregoing), whether or not any such transaction is
governed by or subject to any master agreement, and (b) any and all transactions
of any kind, and the related confirmations, which are subject to the terms and
conditions of, or governed by, any form of master agreement published by the
International Swaps and Derivatives Association, Inc., any International Foreign
Exchange Master Agreement, or any other master agreement (any such master
agreement, together with any related schedules, a “Master Agreement”), including
any such obligations or liabilities under any Master Agreement.

 

“Swap Termination Value” means, in respect of any one or more Swap Contracts,
after taking into account the effect of any legally enforceable netting
agreement relating to such Swap Contracts, (a) for any date on or after the date
such Swap Contracts have been closed out and termination value(s) determined in
accordance therewith, such termination value(s) and (b) for any date prior to
the date referenced in clause (a), the amount(s) determined as the
mark-to-market value(s) for such Swap Contracts, as determined based upon one or
more mid-market or other readily available quotations provided by any recognized
dealer in such Swap Contracts (which may include a Lender or any Affiliate of a
Lender).

 

“Synthetic Lease Obligation” means the monetary obligation of a Person under
(a) a so-called synthetic, off-balance sheet or tax retention lease, or (b) an
agreement for the use or possession of property creating obligations that do not
appear on the balance sheet of such Person but which, upon the insolvency or
bankruptcy of such Person, would be characterized as the indebtedness of such
Person (without regard to accounting treatment).

 

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

 

“Term” means the date that is six (6) months following the Petition Date.

 

“Threshold Amount” means $500,000.

 

“Total Credit Exposure” means, as to any Lender at any time, the outstanding
Loans of such Lender at such time.

 

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“UCC” means the Uniform Commercial Code of any applicable jurisdiction and, if
the applicable jurisdiction shall not have any Uniform Commercial Code, the
Uniform Commercial Code as in effect from time to time in the State of New York.

 

“Uniform Fraudulent Conveyance Act” means the Uniform Fraudulent Conveyance
Act proposed by The National Conference of Commissioners on Uniform State Laws
in 1918, as amended, modified or supplemented to from time to time.

 

“Uniform Fraudulent Transfer Act” means the Uniform Fraudulent Transfer
Act proposed by The National Conference of Commissioners on Uniform State Laws
in 1984, as amended, modified or supplemented to from time to time.

 

“United States” and “U.S.” mean the United States of America.

 

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

 

“U.S. Tax Compliance Certificate” has the meaning specified in
Section 3.1(e)(ii)(B)(3).

 

“Variance Report” has the meaning specified in Section 6.2(j).

 

“Voting Stock” means, with respect to any Person, Equity Interests issued by
such Person the holders of which are ordinarily, in the absence of
contingencies, entitled to vote for the election of directors (or persons
performing similar functions) of such Person, even though the right so to vote
has been suspended by the happening of such a contingency.

 

“Wholly Owned Subsidiary” means any Person 100% of whose Equity Interests are at
the time owned by Parent directly or indirectly through other Persons 100% of
whose Equity Interests are at the time owned, directly or indirectly, by Parent.

 

“Write-Down and Conversion Powers” means, with respect to any EEA Resolution
Authority, the write-down and conversion powers of such EEA Resolution Authority
from time to time under the Bail-In Legislation for the applicable EEA Member
Country, which write-down and conversion powers are described in the EU Bail-In
Legislation Schedule.

 

1.2                               Other Interpretive Provisions.

 

With reference to this Agreement and each other Loan Document, unless otherwise
specified herein or in such other Loan Document:

 

(a)                                 The definitions of terms herein shall apply
equally to the singular and plural forms of the terms defined.  Whenever the
context may require, any pronoun shall include the corresponding masculine,
feminine and neuter forms.  The words “include,” “includes” and “including”
shall be deemed to be followed by the phrase “without limitation.”  The word
“will” shall be construed to have the same meaning and effect as the word
“shall.”  Unless the context requires otherwise, (i) any definition of or
reference to any agreement, instrument or other document (including any Loan
Document or Organization Document) shall be construed as referring to such
agreement, instrument or other document as from time to time amended, modified,
extended, restated, replaced or supplemented (subject to any restrictions on
such amendments, supplements or modifications set forth herein or in any other
Loan Document), (ii) any reference herein to any Person shall be construed to
include such Person’s successors and assigns, (iii) the words “hereto,”
“herein,” “hereof” and “hereunder,” and words of similar import when used in any
Loan

 

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Document, shall be construed to refer to such Loan Document in its entirety and
not to any particular provision thereof, (iv) all references in a Loan Document
to Articles, Sections, Preliminary Statements, Exhibits and Schedules shall be
construed to refer to Articles and Sections of, Preliminary Statements of and
Exhibits and Schedules to, the Loan Document in which such references appear,
(v) any reference to any Law shall include all statutory and regulatory rules,
regulations, orders and provisions consolidating, amending, replacing or
interpreting such Law and any reference to any Law or regulation shall, unless
otherwise specified, refer to such Law or regulation as amended, modified,
extended, restated, replaced or supplemented from time to time, and (vi) the
words “asset” and “property” shall be construed to have the same meaning and
effect and to refer to any and all assets and properties, tangible and
intangible, real and personal, including cash, securities, accounts and contract
rights.

 

(b)                                 In the computation of periods of time from a
specified date to a later specified date, the word “from” means “from and
including;” the words “to” and “until” each mean “to but excluding;” and the
word “through” means “to and including.”

 

(c)                                  Section headings herein and in the other
Loan Documents are included for convenience of reference only and shall not
affect the interpretation of this Agreement or any other Loan Document.

 

1.3                               Accounting Terms.

 

(a)                                 Generally.  All accounting terms not
specifically or completely defined herein shall be construed in conformity with,
and all financial data (including financial ratios and other financial
calculations) required to be submitted pursuant to this Agreement shall be
prepared in conformity with, GAAP applied on a consistent basis, as in effect
from time to time, applied in a manner consistent with that used in preparing
the Audited Financial Statements, except as otherwise specifically prescribed
herein.  Notwithstanding the foregoing, for purposes of determining compliance
with any covenant (including the computation of any financial covenant)
contained herein, Indebtedness of the Loan Parties and their Subsidiaries shall
be deemed to be carried at 100% of the outstanding principal amount thereof, and
the effects of FASB ASC 825 and FASB ASC 470-20 on financial liabilities shall
be disregarded.

 

(b)                                 Changes in GAAP.  If at any time any change
in GAAP (including the adoption of IFRS) would affect the computation of any
financial ratio or requirement set forth in any Loan Document, and either the
Borrowers or the Required Lenders shall so request, the Administrative Agent,
the Lenders and the Borrower shall negotiate in good faith to amend such ratio
or requirement to preserve the original intent thereof in light of such change
in GAAP (subject to the approval of the Required Lenders); provided that, until
so amended, (i) such ratio or requirement shall continue to be computed in
accordance with GAAP prior to such change therein and (ii) the Borrowers shall
provide to the Administrative Agent and the Lenders financial statements and
other documents required under this Agreement or as reasonably requested
hereunder setting forth a reconciliation between calculations of such ratio or
requirement made before and after giving effect to such change in GAAP. Without
limiting the foregoing, leases shall continue to be classified and accounted for
on a basis consistent with that reflected in the Audited Financial Statements
for all purposes of this Agreement, notwithstanding any change in GAAP relating
thereto, unless the parties hereto shall enter into a mutually acceptable
amendment addressing such changes, as provided for above.

 

(c)                                  Consolidation of Variable Interest
Entities.  All references herein to consolidated financial statements of the
Borrowers and their Subsidiaries or to the determination of any amount for the
Borrowers and their Subsidiaries on a consolidated basis or any similar
reference shall, in each case, be deemed to include each variable interest
entity that the Borrowers are required to consolidate pursuant to FASB ASC 810
as if such variable interest entity were a Subsidiary as defined herein.

 

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1.4                               Rounding.

 

Any financial ratios required to be maintained by the Borrowers pursuant to this
Agreement shall be calculated by dividing the appropriate component by the other
component, carrying the result to one place more than the number of places by
which such ratio is expressed herein and rounding the result up or down to the
nearest number (with a rounding-up if there is no nearest number).

 

1.5                               Times of Day; Rates.

 

Unless otherwise specified, all references herein to times of day shall be
references to Eastern time (daylight or standard, as applicable).

 

ARTICLE II

 

THE COMMITMENTS AND CREDIT EXTENSIONS

 

2.1                               Loans.

 

(a)                                 Interim Bankruptcy Court Order Entry Date
Loan. Subject to the terms and conditions set forth in this Agreement, on
August 10, 2018 (or, if later, on or within one Business Day after the date that
the conditions set forth in this Agreement are fully satisfied), each Lender
severally and not jointly agrees to make a Loan in Dollars to the Borrowers
(such loans, collectively, the “Interim Bankruptcy Court Order Entry Date Loan”)
based on such Lender’s Applicable Percentage of the Interim Bankruptcy Court
Order Entry Date Loan Amount set forth on Schedule 2.1.

 

(b)                                 Additional Loans.  Subject to the terms and
conditions set forth in this Agreement and in accordance and compliance with the
Budget and the Bankruptcy Court Orders, each Lender severally and not jointly
agrees, from time to time (i) during the Bankruptcy Court Order Period, to make
additional Loans in Dollars to the Borrowers in an amount which, when taken
together with the Interim Bankruptcy Court Order Entry Date Loan and all other
Loans advanced after the Interim Bankruptcy Court Order Entry Date Loan under
the Loan Documents, shall not exceed such Lender’s Applicable Percentage of the
Bankruptcy Court Order Period Cap and (ii) thereafter, to make additional Loans
in Dollars to the Borrowers in an amount which, when taken together with all
other Loans advanced under the Loan Documents, shall not exceed such Lender’s
Commitment.  Such Loans may neither be requested nor made more frequently than
once every seven (7) consecutive days and in the aggregate not to exceed the
lesser of the unfunded portion of the Loan Commitment and the amount needed for
working capital purposes and operating expenses set forth in (and in accordance
with) the Budget and in accordance with the Bankruptcy Court Orders.  Any Loans
funded under the Loan Documents shall automatically and permanently decrease the
remaining Loan Commitments and Commitments available hereunder and any Loans
that are borrowed may not be re-borrowed.

 

2.2                               Borrowings, Conversions and Continuations of
Loans.

 

(a)                                  Each Borrowing of the Loans made after the
Interim Bankruptcy Court Order Entry Date shall be made upon the Borrower
Representative’s irrevocable notice to the Administrative Agent, which may be
given by (A) telephone, or (B) a Loan Notice; provided that any telephonic
notice must be confirmed immediately by delivery to the Administrative Agent of
a Loan Notice.  Each such Loan Notice must be received by the Administrative
Agent not later than 12:00 noon one (1) Business Day prior to the requested date
of any Borrowing.  Such Loan Notice shall specify (i)  the requested date of the
Borrowing (which shall be a Business Day), (ii) the principal amount of Loans to
be borrowed,

 

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(iii) details on the use of the proceeds of such Borrowing in accordance with
the Budget and the Bankruptcy Court Orders, (iv) that all conditions in
Section 2.1(b) (or, if such Borrowing is the Interim Bankruptcy Court Order
Entry Date Loan, Section 2.1(a)) and Section 4.1 and Section 4.2 have been
satisfied and (v) in detail acceptable to the Administrative Agent and the
Lenders where the Loans should be wired.

 

(b)                                 Following receipt of a Loan Notice, the
Administrative Agent shall promptly notify each Lender of the amount of its
Applicable Percentage of the applicable Loans.  In the case of a Borrowing, upon
satisfaction of the applicable conditions set forth in Section 2.1(b) (or, if
such Borrowing is the Interim Bankruptcy Court Order Entry Date Loan,
Section 2.1(a)) and Section 4.1 and Section 4.2, each Lender shall make the
amount of its Loan available in immediately available funds using the wire
instructions specified in the applicable Loan Notice.

 

2.3                               Administrative Priority.

 

Each of the Loan Parties agrees for itself that, pursuant to Sections 364(c) and
364(d) of the Bankruptcy Code, the Obligations of such Person shall be DIP
Superpriority Claims and constitute allowed administrative expenses in the
Chapter 11 Case, having priority over all administrative expenses of and
unsecured claims against such Person now existing or hereafter arising, of any
kind or nature whatsoever, including all administrative expenses of the kind
specified in, or arising or ordered under, Sections 105, 326, 328, 330, 331,
503(b), 506(c), 507(a), 507(b), 546(c), 726 and 1114 of the Bankruptcy Code,
other than with respect to the Carve-Out.

 

2.4                               [Reserved].

 

2.5                               Prepayments.

 

(a)                                 Voluntary Prepayments of Loans.

 

(i)                                     The Borrowers may, upon notice using the
Notice of Loan Prepayment from the Borrowers to the Administrative Agent and the
Lenders, at any time or from time to time voluntarily prepay the Loans in whole
or in part without premium or penalty.  If such notice is given by the
Borrowers, the Borrowers shall make such prepayment and the payment amount
specified in the applicable Notice of Loan Prepayment shall be due and payable
on the date specified therein.  Each such prepayment shall be applied to the
Loans of the Lenders in accordance with their respective Applicable Percentages.

 

(b)                                 Mandatory Prepayments of Loans.

 

(i)                                     [Reserved].

 

(ii)                                  Dispositions and Recovery Events.  The
Borrowers shall prepay the Loans as hereafter provided in an aggregate amount
equal to 100% of the Net Cash Proceeds received by any Loan Party or any
Subsidiary from all Dispositions (other than Permitted Transfers).

 

(iii)                               Debt Issuances.  Immediately upon receipt by
any Loan Party or any Subsidiary of the Net Cash Proceeds of any Debt Issuance,
the Borrowers shall prepay the Loans as hereafter provided in an aggregate
amount equal to 100% of such Net Cash Proceeds.

 

(iv)                              Final Bankruptcy Court Order.  Without
limiting any other provision of this Agreement or any other Loan Document
permitting or requiring prepayment of the Loans in

 

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whole or in part, the Borrowers shall pay the Loans and other Obligations in
full on the date that is thirty-five (35) days after the Petition Date, unless
the Final Bankruptcy Court Order has been entered by the Bankruptcy Court on or
prior to such date.

 

(v)                                 Application of Mandatory Prepayments.  All
amounts required to be paid pursuant to this Section 2.5(b) shall be applied as
follows:  first, ratably, to the Loans, and second, ratably, to all other
Obligations.  All prepayments under this Section 2.5(b) shall be accompanied by
interest in cash on the principal amount prepaid through the date of prepayment.

 

2.6                               [Reserved].

 

2.7                               Repayment of Loans.

 

On the Maturity Date, the Borrowers shall pay, on a ratable basis, to the
Lenders and the other Secured Parties the aggregate principal amount of the
Loans and all other Obligations that are outstanding on such date, together with
all interest and fees related thereto.

 

2.8                               Interest.

 

(a)                                 Subject to the provisions of subsection
(b) below, each Loan shall bear interest on the outstanding principal amount
thereof from the Closing Date at the Applicable Rate.

 

(b)                                 (i) If any amount of principal of any Loan
is not paid when due (without regard to any applicable grace periods), whether
at stated maturity, by acceleration or otherwise, such amount shall thereafter
bear interest at an interest rate per annum at all times equal to the Default
Rate to the fullest extent permitted by applicable Laws.

 

(ii)                                  If any amount (other than principal of any
Loan) payable by the Borrowers under any Loan Document is not paid when due
(without regard to any applicable grace periods), whether at stated maturity, by
acceleration or otherwise, then such amount shall thereafter bear interest at an
interest rate per annum at all times equal to the Default Rate to the fullest
extent permitted by applicable Laws.

 

(iii)                               While any Event of Default exists (other
than as set forth in clauses (b)(i) and (b)(ii) above), the Borrowers shall pay
interest on the principal amount of all outstanding Obligations hereunder at an
interest rate per annum at all times equal to the Default Rate to the fullest
extent permitted by applicable Laws.

 

(iv)                              Accrued and unpaid interest on past due
amounts (including interest on past due interest) shall be due and payable upon
demand.

 

(c)                                  Interest on each Loan shall be due and
payable in-kind in arrears, and be capitalized, on each Interest Payment Date
(or, with respect to interest at the Default Rate, upon demand and on the
Maturity Date) applicable thereto by adding such accrued interest amount for
such period to the principal amount of such Loan, with such interest amount
added to such principal amount also accruing interest on a going-forward basis
after being added to such principal amount of such Loan, and interest shall
otherwise be due and payable at such other times as may be specified herein. 
For the avoidance of doubt, such interest that is added to the principal amount
of the Loans shall be principal owed on such Loans and shall accrue interest at
all times after being added to such principal amount of such Loans.  Interest
hereunder shall be due and payable in accordance with the terms hereof before
and after judgment, and before and after the commencement of any proceeding
under any Debtor Relief Law.

 

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2.9                               Additional Consideration.

 

(a)                                 The Borrowers shall pay to the
Administrative Agent, for the pro rata benefit of the Lenders, a fee in the
amount of one percent (1.0%) of the Commitment, which shall be non-refundable
and fully earned on the Final Bankruptcy Court Order Entry Date and shall be due
and payable on the Maturity Date.

 

(b)                                 On the effective date of any extension of
the Stated Maturity Date pursuant to Section 2.15 (such date, the “Extension
Effective Date”), the Borrowers shall pay to the Administrative Agent, for the
pro rata benefit of the Lenders, an extension fee (the “Extension Fee”) equal to
1.00% of the Commitments so extended, which shall be non-refundable and fully
earned on the Extension Effective Date and shall be due and payable on the
Maturity Date.

 

(c)                                  The Borrowers shall pay to the Lenders such
additional amounts as shall have been separately agreed upon in writing in the
amounts and at the times so specified.  Such additional amounts shall be fully
earned when paid and shall not be refundable for any reason whatsoever.

 

(d)                                 Each fee or other amount payable pursuant to
this Section 2.9 shall be payable in-kind, and be capitalized, on the date such
fee or other amount is otherwise due and payable by adding such fee or other
amount to the principal amount of the Loans then outstanding, with such fee or
other amount added to such principal amount also accruing interest on a
going-forward basis after being added to such principal amount of such Loans. 
For the avoidance of doubt, each such fee or other amount that is added to the
principal amount of the Loans shall be principal owed on such Loans and shall
accrue interest at all times after being added to such principal amount of such
Loans.

 

2.10                        Computation of Interest.

 

All computations of interest for Loans shall be made on the basis of a year of
365 or 366 days, as the case may be, and actual days elapsed.  Interest shall
accrue on each Loan for the day on which the Loan is made, and shall not accrue
on a Loan, or any portion thereof, for the day on which the Loan or such portion
is paid, provided that any Loan that is repaid on the same day on which it is
made shall, subject to Section 2.12(a), bear interest for one day.  Each
determination by the Administrative Agent of an interest rate hereunder shall be
conclusive and binding for all purposes, absent manifest error.

 

2.11                        Evidence of Debt.

 

The Credit Extensions made by each Lender shall be evidenced by one or more
accounts or records maintained by the Borrowers.  Any failure to so record or
any error in doing so shall not, however, limit or otherwise affect the
obligation of the Borrowers hereunder to pay any amount owing with respect to
the Obligations.  The Borrowers shall execute and deliver to each Lender a
promissory note, which shall evidence such Lender’s Loans in addition to such
accounts or records.  Each such promissory note shall be in the form of
Exhibit 2.11 (a “Note”).  Each Lender may (but are not required to) attach
schedules to its Note and endorse thereon the date, amount and maturity of its
Loans and payments with respect thereto.

 

2.12                        Payments Generally; Administrative Agent’s Claw
Back.

 

(a)                                 General.  All payments to be made by the
Borrowers shall be made free and clear of and without condition or deduction for
any counterclaim, defense, recoupment or setoff.  Except as otherwise expressly
provided herein, all payments by the Borrowers hereunder shall be made to the
Administrative Agent and the respective Lenders to which such payment is owed,
at the Administrative Agent’s Office

 

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and such Lender’s respective Lending Offices (as applicable) in Dollars and in
immediately available funds not later than 2:00 p.m. on the date specified
herein, in each case, based on each Lender’s Applicable Percentage (or other
applicable share as provided herein).  All payments received by the
Administrative Agent or any Lender after 2:00 p.m. shall be deemed received on
the next succeeding Business Day and any applicable interest or fee shall
continue to accrue.  If any payment to be made by the Borrowers shall come due
on a day other than a Business Day, payment shall be made on the next following
Business Day, and such extension of time shall be reflected in computing
interest or fees, as the case may be.

 

(b)                                 (i)                                    
[Reserved].

 

(ii)                                  Payments by Borrower; Presumptions by
Administrative Agent.  Unless the Administrative Agent shall have received
notice from the Borrowers prior to the date on which any payment is due to the
Administrative Agent for the account of the Lenders hereunder that the Borrowers
will not make such payment, the Administrative Agent may assume that the
Borrowers has made such payment on such date in accordance herewith and may, in
reliance upon such assumption, distribute to the Lenders the amount due.  In
such event, if the Borrowers have not in fact made such payment, then each of
the Lenders severally agrees to repay to the Administrative Agent forthwith on
demand the amount so distributed to such Lender, in immediately available funds
with interest thereon, for each day from and including the date such amount is
distributed to it to but excluding the date of payment to the Administrative
Agent, at the greater of the Federal Funds Rate and a rate determined by the
Administrative Agent in accordance with banking industry rules on interbank
compensation.

 

A notice of the Administrative Agent to any Lender or the Borrowers with respect
to any amount owing under this Section 2.12(b) shall be conclusive, absent
manifest error.

 

(c)                                  Obligations of Borrowers Joint and
Several.  The obligations of each Borrower hereunder are joint and several and
each Borrower shall be responsible for the failure of any other Borrower to
perform any Obligation or make any payment required by this Agreement or any
other Loan Document.

 

(d)                                 Obligations of Lenders Several.  The
obligations of the Lenders hereunder to make Loans and to make payments pursuant
to Section 11.4(c) are several and not joint.  The failure of any Lender to make
any Loan, to fund any such participation or to make any payment under
Section 11.4(c) on any date required hereunder shall not relieve any other
Lender of its corresponding obligation to do so on such date, and no Lender
shall be responsible for the failure of any other Lender to so make its Loan, to
purchase its participation or to make its payment under Section 11.4(c).

 

(e)                                  Funding Source.  Nothing herein shall be
deemed to obligate any Lender to obtain the funds for any Loan in any particular
place or manner or to constitute a representation by any Lender that it has
obtained or will obtain the funds for any Loan in any particular place or
manner.

 

2.13                        Sharing of Payments by Lenders.

 

If any Lender shall, by exercising any right of setoff or counterclaim or
otherwise, obtain payment in respect of any principal of or interest on any of
the Loans made by it resulting in such Lender’s receiving payment of a
proportion of the aggregate amount of such Loans and accrued interest thereon
greater than its pro rata share thereof as provided herein, then the Lender
receiving such greater proportion shall (a) notify the Administrative Agent of
such fact, and (b) purchase (for cash at face value) participations in the Loans
of the other Lenders, or make such other adjustments as shall be equitable, so
that the benefit of all such payments shall be shared by the Lenders ratably in
accordance with the

 

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aggregate amount of principal of and accrued interest on their respective Loans
and other amounts owing them, provided that:

 

(i)                                     if any such participations or
subparticipations are purchased and all or any portion of the payment giving
rise thereto is recovered, such participations or subparticipations shall be
rescinded and the purchase price restored to the extent of such recovery,
without interest; and

 

(ii)                                  the provisions of this Section shall not
be construed to apply to (A) any payment made by or on behalf of the Borrowers
pursuant to and in accordance with the express terms of this Agreement, or
(B) any payment obtained by a Lender as consideration for the assignment of or
sale of a participation in any of its Loans to any assignee or participant,
other than an assignment to any Loan Party or any Subsidiary(as to which the
provisions of this Section shall apply).

 

Each Loan Party consents to the foregoing and agrees, to the extent it may
effectively do so under applicable Law, that any Lender acquiring a
participation pursuant to the foregoing arrangements may exercise against such
Loan Party rights of setoff and counterclaim with respect to such participation
as fully as if such Lender were a direct creditor of such Loan Party in the
amount of such participation.

 

2.14                        Certain Bankruptcy Matters.

 

(a)                                 The Loan Parties hereby agree that the
Obligations shall, subject to the Carve-Out, (i) constitute DIP Superpriority
Claims over all administrative expense claims and claims against the Loan
Parties now existing or hereafter arising, of any kind or nature whatsoever,
including all administrative expense claims of the kind specified in Sections
105, 326, 328, 330, 331, 365, 503(a), 503(b), 506(c) (subject to entry of the
Final Bankruptcy Court Order), 507(a), 507(b), 546(c), 546(d), 726, 1113, 1114
or any other provisions of the Bankruptcy Code and all super-priority
administrative expense claims granted to any other Person the establishment of
which super-priority shall have been approved and authorized by the Bankruptcy
Court and (ii) be secured by the Collateral pursuant to Sections 364(c)(2),
(c)(3) and (d)(1) of the Bankruptcy Code and, to the extent provided in any of
the Bankruptcy Court Orders.

 

(b)                                 In the event of a conflict between, or
inconsistency among, the Interim Bankruptcy Court Order or the Final Bankruptcy
Court Order, on the one hand, and any Loan Document, on the other hand, the
Interim Bankruptcy Court Order or the Final Bankruptcy Court Order, as the case
may be, shall control.

 

(c)                                  Notwithstanding anything to the contrary
contained herein or elsewhere:

 

(i)                                     the Secured Parties shall not be
required to prepare, file, register or publish any financing statements,
mortgages, hypothecs, account control agreements, notices of Lien or similar
instruments in any jurisdiction or filing or registration office, or to take
possession of any Collateral or to take any other action in order to validate,
render enforceable or perfect the Liens on the Collateral granted by or pursuant
to the Bankruptcy Court Orders, this Agreement or any other Loan Document. If
the Administrative Agent (at the Required Lenders’ direction, which shall be in
their sole discretion), from time to time elects to prepare, file, register or
publish any such financing statements, mortgages, hypothecs, account control
agreements, notices of Lien or similar instruments, take possession of any
Collateral, or take any other action to validate, render enforceable or perfect
all or any portion of the Administrative Agent’s Liens on the Collateral,
(A) all such documents and actions shall be deemed to have been filed,
registered, published or recorded or taken at the time and on the date that the
Interim Bankruptcy Court Order is entered,

 

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and (B) shall not negate or impair the validity or effectiveness of this
Section 2.14(c) or of the perfection of any other Liens in favor of the
Administrative Agent, for the benefit of the Secured Parties, on the Collateral.

 

(ii)                                  Except as otherwise agreed to by the
Required Lenders, the Liens, Lien priorities, DIP Superpriority Claims and other
rights and remedies granted to the Secured Parties pursuant to the Bankruptcy
Court Orders, this Agreement or the other Loan Documents (specifically
including, but not limited to, the existence, perfection, enforceability and
priority of the Liens provided for herein and therein, and the DIP Superpriority
Claims provided herein and therein) shall not be modified, altered or impaired
in any manner by any other financing or extension of credit or incurrence of
indebtedness by any Borrower or any other Loan Party (pursuant to Section 364 of
the Bankruptcy Code or otherwise), or by dismissal or conversion of the
Chapter 11 Case, or by any other act or omission whatsoever.

 

(d)                                 Without limiting the generality of the
foregoing, notwithstanding any such financing, extension, incurrence, dismissal,
conversion, act or omission:

 

(i)                                     no costs or expenses of administration
which have been or may be incurred in the Chapter 11 Case or any conversion of
the same or in any other proceedings related thereto, and no priority claims,
are or will be prior to or on a parity with any claim of any Secured Party
against the Loan Parties in respect of any Obligations;

 

(ii)                                  the Administrative Agent’s Liens on the
Collateral shall constitute valid, enforceable and perfected first priority
Liens, and shall be prior to all other Liens, now existing or hereafter arising,
in favor of any other creditor or other Person; and

 

(iii)                               the Administrative Agent’s Liens on the
Collateral shall continue to be valid, enforceable and perfected without the
need for the Administrative Agent or any other Secured Party to prepare, file,
register or publish any financing statements, mortgages, hypothecs, account
control agreements, notices of Lien or similar instruments or to otherwise
perfect the Administrative Agent’s Liens under applicable non-bankruptcy law.

 

In connection with any sale or Disposition of all or any portion of the
Collateral, including in each case pursuant to Sections 9-610 or 9-620 of the
UCC, at any sale thereof conducted under the provisions of the Bankruptcy Code,
including Section 363 of the Bankruptcy Code or as part of restructuring plan
subject to confirmation under Section 1129(b)(2)(A)(iii) of the Bankruptcy Code,
or at any sale or foreclosure conducted by the Administrative Agent, in
accordance with applicable law and, with respect to any credit bid,
Section 363(k) of the Bankruptcy Code, each Borrower and each other Loan Party
hereby gives the Administrative Agent (at the direction of the Required Lenders)
the power and right, without assent by such Loan Party, to “credit bid” the full
amount of all Obligations in order to purchase (either directly or through one
or more acquisition vehicles) all or any portion of the Collateral.

 

2.15                        Extension of Maturity Date.

 

The Borrowers shall have an option to extend the Maturity Date then in effect
for one (1) additional term, not longer than ninety (90) days, subject to
satisfaction of the following conditions precedent:

 

(i)                                     each of the extending Lenders and the
Administrative Agent consent to the extension in their sole discretion;

 

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(ii)                                  as of the Extension Effective Date, the
representations and warranties of each Loan Party contained in Article V or any
other Loan Document, or which are contained in any document furnished at any
time under or in connection herewith or therewith, shall be true and correct in
all material respects (except to the extent any such representation or warranty
is already qualified by materiality, in which case it shall be true and correct
in all respects) on and as of such date, except to the extent that such
representations and warranties specifically refer to an earlier date, in which
case they shall be true and correct as of such earlier date, and except that for
purposes of this Section 4.2, the representations and warranties contained in
subsections (a) and (b) of Section 5.5 shall be deemed to refer to the most
recent statements, if any, furnished pursuant to clauses (a) and (b),
respectively, of Section 6.1;

 

(iii)                               the Borrowers shall have paid the Extension
Fee to the Administrative Agent, for the benefit of the extending Lenders
consenting to such extension, payable to each such Lender ratably based on its
share of the Commitments subject to extension and otherwise in accordance with
Section 2.9;

 

(iv)                              no Default or Event of Default shall have
occurred and be continuing on the Extension Effective Date; and

 

(v)                                 the Borrowers shall have delivered a written
request to extend the Stated Maturity Date to the Administrative Agent not less
than five (5) Business Days prior to the Stated Maturity Date then in effect
(which shall be promptly forwarded by the Administrative Agent to each Lender).

 

ARTICLE III

 

TAXES, YIELD PROTECTION AND ILLEGALITY

 

3.1                               Taxes.

 

(a)                                 Payments Free of Taxes; Obligation to
Withhold; Payments on Account of Taxes.

 

(i)                                     Any and all payments by or on account of
any obligation of any Loan Party under any Loan Document shall be made without
deduction or withholding for any Taxes, except as required by applicable Laws. 
If any applicable Laws (as determined in the good faith discretion of the
Administrative Agent) require the deduction or withholding of any Tax from any
such payment by the Administrative Agent or a Loan Party, then the
Administrative Agent or such Loan Party shall be entitled to make such deduction
or withholding, upon the basis of the information and documentation to be
delivered pursuant to Section 3.1(e) below.

 

(ii)                                  If any Loan Party or the Administrative
Agent shall be required by the Internal Revenue Code to withhold or deduct any
Taxes, including both U.S. federal backup withholding and other withholding
taxes, from any payment, then (A) the Administrative Agent shall withhold or
make such deductions as are determined by the Administrative Agent to be
required based upon the information and documentation it has received pursuant
to Section 3.1(e) below, (B) the Administrative Agent shall timely pay the full
amount withheld or deducted to the relevant Governmental Authority in accordance
with the Internal Revenue Code, and (C) to the extent that the withholding or
deduction is made on account of Indemnified Taxes, the sum payable by the
applicable Loan Party shall be increased as necessary so that after any required
withholding or the making of all required deductions (including deductions
applicable to additional sums payable

 

29

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under this Section 3.1) the applicable Recipient receives an amount equal to the
sum it would have received had no such withholding or deduction been made.

 

(iii)                               If any Loan Party or the Administrative
Agent shall be required by any applicable Laws other than the Internal Revenue
Code to withhold or deduct any Taxes from any payment, then (A) such Loan Party
or the Administrative Agent, as required by such Laws, shall withhold or make
such deductions as are determined by it to be required based upon the
information and documentation it has received pursuant to Section 3.1(e) below,
(B) such Loan Party or the Administrative Agent, to the extent required by such
Laws, shall timely pay the full amount withheld or deducted to the relevant
Governmental Authority in accordance with such Laws, and (C) to the extent that
the withholding or deduction is made on account of Indemnified Taxes, the sum
payable by the applicable Loan Party shall be increased as necessary so that
after any required withholding or the making of all required deductions
(including deductions applicable to additional sums payable under this
Section 3.1) the applicable Recipient receives an amount equal to the sum it
would have received had no such withholding or deduction been made.

 

(b)                                 Payment of Other Taxes by the Loan Parties. 
Without limiting the provisions of subsection (a) above, the Loan Parties shall
timely pay to the relevant Governmental Authority in accordance with applicable
Laws, or at the option of the Administrative Agent timely reimburse it for the
payment of, any Other Taxes.

 

(c)                                  Tax Indemnifications.

 

(i)                                     Each of the Loan Parties shall, and does
hereby, jointly and severally indemnify each Recipient, and shall make payment
in respect thereof within ten days after demand therefor, for the full amount of
any Indemnified Taxes (including Indemnified Taxes imposed or asserted on or
attributable to amounts payable under this Section 3.1) payable or paid by such
Recipient or required to be withheld or deducted from a payment to such
Recipient, and any penalties, interest and reasonable expenses arising therefrom
or with respect thereto, whether or not such Indemnified Taxes were correctly or
legally imposed or asserted by the relevant Governmental Authority. A
certificate as to the amount of such payment or liability delivered to the
Borrower by a Lender (with a copy to the Administrative Agent), or by the
Administrative Agent on its own behalf or on behalf of a Lender, shall be
conclusive absent manifest error.  Each of the Loan Parties shall, and does
hereby, jointly and severally indemnify the Administrative Agent, and shall make
payment in respect thereof within ten days after demand therefor, for any amount
which a Lender for any reason fails to pay indefeasibly to the Administrative
Agent as required pursuant to Section 3.1(c)(ii) below.

 

(ii)                                  Each Lender shall, and does hereby,
severally indemnify, and shall make payment in respect thereof within 10 days
after demand therefor, (x) the Administrative Agent against any Indemnified
Taxes attributable to such Lender (but only to the extent that any Loan Party
has not already indemnified the Administrative Agent for such Indemnified Taxes
and without limiting the obligation of the Loan Parties to do so), (y) the
Administrative Agent and the Loan Parties, as applicable, against any Taxes
attributable to such Lender’s failure to comply with the provisions of
Section 11.6(d) relating to the maintenance of a Participant Register and
(z) the Administrative Agent and the Loan Parties, as applicable, against any
Excluded Taxes attributable to such Lender, in each case, that are payable or
paid by the Administrative Agent or a Loan Party in connection with any Loan
Document, and any reasonable expenses arising therefrom or with respect thereto,
whether or not such Taxes were correctly or legally imposed or asserted by the
relevant Governmental Authority. A certificate as to the amount of such payment

 

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or liability delivered to any Lender by the Administrative Agent shall be
conclusive absent manifest error.  Each Lender hereby authorizes the
Administrative Agent to set off and apply any and all amounts at any time owing
to such Lender under this Agreement or any other Loan Document against any
amount due to the Administrative Agent under this clause (ii).

 

(d)                                 Evidence of Payments.  After any payment of
Taxes by any Borrower to a Governmental Authority as provided in this
Section 3.1, such Borrower shall deliver to the Administrative Agent and the
Lenders the original or a certified copy of a receipt issued by such
Governmental Authority evidencing such payment, a copy of any return required by
Laws to report such payment or other evidence of such payment reasonably
satisfactory to the Administrative Agent and the Lenders.

 

(e)                                  Status of Lenders; Tax Documentation.

 

(i)                                     Any Lender that is entitled to an
exemption from or reduction of withholding Tax with respect to payments made
under any Loan Document shall deliver to the Borrower and the Administrative
Agent, at the time or times reasonably requested by the Borrower or the
Administrative Agent, such properly completed and executed documentation
reasonably requested by the Borrowers or the Administrative Agent as will permit
such payments to be made without withholding or at a reduced rate of
withholding.  In addition, any Lender, if reasonably requested by the Borrowers
or the Administrative Agent, shall deliver such other documentation prescribed
by applicable Law or reasonably requested by the Borrowers or the Administrative
Agent as will enable the Borrowers or the Administrative Agent to determine
whether or not such Lender is subject to backup withholding or information
reporting requirements.  Notwithstanding anything to the contrary in the
preceding two sentences, the completion, execution and submission of such
documentation (other than such documentation set forth in Section 3.1(e)(ii)(A),
3.1(e)(ii)(B) and 3.1(e)(ii)(D) below) shall not be required if in the Lender’s
reasonable judgment such completion, execution or submission would subject such
Lender to any material unreimbursed cost or expense or would materially
prejudice the legal or commercial position of such Lender.

 

(ii)                                  Without limiting the generality of the
foregoing, in the event that any Borrower is a U.S. Person,

 

(A)             any Lender that is a U.S. Person shall deliver to the Borrowers
and the Administrative Agent on or prior to the date on which such Lender
becomes a Lender under this Agreement (and from time to time thereafter upon the
reasonable request of the Borrowers or the Administrative Agent), executed
copies of IRS Form W-9 certifying that such Lender is exempt from U.S. federal
backup withholding tax;

 

(B)             any Foreign Lender shall, to the extent it is legally entitled
to do so, deliver to the Borrowers and the Administrative Agent (in such number
of copies as shall be requested by the recipient) on or prior to the date on
which such Foreign Lender becomes a Lender under this Agreement (and from time
to time thereafter upon the reasonable request of the Borrowers or the
Administrative Agent), whichever of the following is applicable:

 

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

 

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such tax treaty and (y) with respect to any other applicable payments under any
Loan Document, IRS Form W-8BEN-E (or W-8BEN, as applicable) establishing an
exemption from, or reduction of, U.S. federal withholding Tax pursuant to the
“business profits” or “other income” article of such tax treaty;

 

(2)                                 executed copies of IRS Form W-8ECI;

 

(3)                                 in the case of a Foreign Lender claiming the
benefits of the exemption for portfolio interest under Section 881(c) of the
Internal Revenue Code, (x) a certificate substantially in the form of
Exhibit 3.1-A to the effect that such Foreign Lender is not a “bank” within the
meaning of Section 881(c)(3)(A) of the Internal Revenue Code, a “10 percent
shareholder” of any Borrower within the meaning of Section 881(c)(3)(B) of the
Internal Revenue Code, or a “controlled foreign corporation”  related to any
Borrower described in Section 881(c)(3)(C) of the Internal Revenue Code (a “U.S.
Tax Compliance Certificate”) and (y) executed copies of IRS Form W-8BEN-E (or
W-8BEN, as applicable); or

 

(4)                                 to the extent a Foreign Lender is not the
beneficial owner, executed copies of IRS Form W-8IMY, accompanied by IRS
Form W-8ECI, IRS Form W-8BEN-E (or W-8BEN, as applicable), a U.S. Tax Compliance
Certificate substantially in the form of Exhibit 3.1-B or Exhibit 3.1-C, IRS
Form W-9, and/or other certification documents from each beneficial owner, as
applicable; provided that if the Foreign Lender is a partnership and one or more
direct or indirect partners of such Foreign Lender are claiming the portfolio
interest exemption, such Foreign Lender may provide a U.S. Tax Compliance
Certificate substantially in the form of Exhibit 3.1-D on behalf of each such
direct and indirect partner;

 

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

 

(D)             if a payment made to a Lender under any Loan Document would be
subject to U.S. federal withholding Tax imposed by FATCA if such Lender were to
fail to comply with the applicable reporting requirements of FATCA (including
those contained in Section 1471(b) or 1472(b) of the Internal Revenue Code, as
applicable), such Lender shall deliver to the Borrowers and the Administrative
Agent at the time or times prescribed by Law and at such time or times
reasonably requested by the Borrowers or the Administrative Agent such
documentation prescribed by applicable Law (including as prescribed by
Section 1471(b)(3)(C)(i) of the Internal Revenue Code) and such additional
documentation reasonably requested by the Borrowers or the Administrative Agent
as may be necessary for the Borrowers and the Administrative Agent to comply
with their obligations under FATCA and to

 

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determine that such Lender has complied with such Lender’s obligations under
FATCA or to determine the amount to deduct and withhold from such payment.
Solely for purposes of this clause (D), “FATCA” shall include any amendments
made to FATCA after the Closing Date.

 

(f)                                   Treatment of Certain Refunds.  If any
Recipient determines, in its sole discretion exercised in good faith, that it
has received a refund of any Indemnified Taxes as to which it has been
indemnified by any Loan Party or with respect to which any Loan Party has paid
additional amounts pursuant to this Section 3.1, it shall pay to the Loan Party
an amount equal to such refund (but only to the extent of indemnity payments
made, or additional amounts paid, by a Loan Party under this Section 3.1 with
respect to the Taxes giving rise to such refund), net of all out-of-pocket
expenses (including Taxes) incurred by such Recipient, and without interest
(other than any interest paid by the relevant Governmental Authority with
respect to such refund), provided that the Loan Party, upon the request of the
Recipient, agrees to repay the amount paid over pursuant to this subsection
(f) to the Loan Party (plus any penalties, interest or other charges imposed by
the relevant Governmental Authority) to the Recipient in the event the Recipient
is required to repay such refund to such Governmental Authority. Notwithstanding
anything to the contrary in this subsection, in no event will the applicable
Recipient be required to pay any amount to the Loan Party pursuant to this
subsection the payment of which would place the Recipient in a less favorable
net after-Tax position than such Recipient would have been in if the Tax subject
to indemnification and giving rise to such refund had not been deducted,
withheld or otherwise imposed and the indemnification payments or additional
amounts with respect to such Tax had never been paid. This subsection shall not
be construed to require any Recipient to make available its Tax returns (or any
other information relating to its Taxes that it deems confidential) to any Loan
Party or any other Person.

 

(g)                                  Survival.  Each party’s obligations under
this Section 3.1 shall survive the resignation or replacement of the
Administrative Agent or any assignment of rights by, or the replacement of, a
Lender and the repayment, satisfaction or discharge of all other Obligations.

 

3.2                               [Reserved].

 

3.3                               [Reserved].

 

3.4                               Increased Costs.

 

(a)                                 Increased Costs Generally.  If any Change in
Law shall:

 

(i)                                     impose, modify or deem applicable any
reserve, special deposit, compulsory loan, insurance charge or similar
requirement against assets of, deposits with or for the account of, or credit
extended or participated in by, any Lender;

 

(ii)                                  subject any Recipient to any Taxes (other
than (A) Indemnified Taxes, (B) Taxes described in clauses (b) through (d) of
the definition of Excluded Taxes and (C) Connection Income Taxes) on its loans,
loan principal, letters of credit, commitments, or other obligations, or its
deposits, reserves, other liabilities or capital attributable thereto; or

 

(iii)                               impose on any Lender any other condition,
cost or expense affecting this Agreement made by such Lender; and the result of
any of the foregoing shall be to increase the cost to such Lender of making,
converting to, continuing or maintaining any Loan (or of maintaining its
obligation to make any such Loan), or to reduce the amount of any sum received
or receivable by such Lender hereunder (whether of principal, interest or any
other amount) then,

 

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upon request of such Lender, the Borrowers will pay to such Lender such
additional amount or amounts as will compensate such Lender for such additional
costs incurred or reduction suffered.

 

(b)                                 Capital Requirements.  If any Lender
determines that any Change in Law affecting such Lender or any Lending Office of
such Lender or such Lender’s holding company, if any, regarding capital or
liquidity requirements has or would have the effect of reducing the rate of
return on such Lender’s capital or on the capital of such Lender’s holding
company, if any, as a consequence of this Agreement, the Commitments of such
Lender or the Loans made by such Lender, to a level below that which such Lender
or such Lender’s holding company could have achieved but for such Change in Law
(taking into consideration such Lender’s policies and the policies of such
Lender’s holding company with respect to capital adequacy), then from time to
time the Borrowers will pay to such Lender such additional amount or amounts as
will compensate such Lender or such Lender’s holding company for any such
reduction suffered.

 

(c)                                  Certificates for Reimbursement.  A
certificate of a Lender setting forth the amount or amounts necessary to
compensate such Lender or its holding company, as the case may be, as specified
in subsection (a) or (b) of this Section and delivered to the Borrowers shall be
conclusive absent manifest error.  The Borrowers shall pay such Lender the
amount shown as due on any such certificate within ten days after receipt
thereof.

 

(d)                                 Delay in Requests.  Failure or delay on the
part of any Lender to demand compensation pursuant to the foregoing provisions
of this Section shall not constitute a waiver of such Lender’s right to demand
such compensation, provided that the Borrowers shall not be required to
compensate a Lender pursuant to the foregoing provisions of this Section for any
increased costs incurred or reductions suffered more than nine months prior to
the date that such Lender notifies the Borrowers of the Change in Law giving
rise to such increased costs or reductions and of such Lender’s intention to
claim compensation therefor (except that, if the Change in Law giving rise to
such increased costs or reductions is retroactive, then the nine-month period
referred to above shall be extended to include the period of retroactive effect
thereof).

 

3.5                               [Reserved].

 

3.6                               [Reserved].

 

3.7                               Survival.

 

All of the Loan Parties’ obligations under this Article III shall survive
repayment of all Obligations hereunder and resignation of the Administrative
Agent.

 

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ARTICLE IV

 

CONDITIONS PRECEDENT TO CREDIT EXTENSIONS

 

4.1                               Conditions to Initial Credit Extension.

 

This Agreement shall become effective upon, and the obligation of each Lender to
make the Interim Bankruptcy Court Order Entry Date Loan hereunder is subject to,
the satisfaction (or waiver by the Required Lenders) of the following conditions
precedent:

 

(a)                                 Receipt by the Administrative Agent and the
Lenders of the following, each in form and substance satisfactory to the
Administrative Agent and each Lender:

 

(i)                                     Loan Documents.  Executed counterparts
of this Agreement and the other Loan Documents, each properly executed by a
Responsible Officer of the signing Loan Party and, in the case of this
Agreement, by each Lender.

 

(ii)                                  Personal Property Collateral.  The
Administrative Agent shall have a perfected, first priority security interest in
all of the Collateral as and to the extent pursuant to Section 2.14, with only
such exceptions as are acceptable to Administrative Agent and the Lenders in
their sole discretion.

 

(iii)                               Notes.  Delivery by the Borrowers of
original Notes to each Lender in the principal amount of the Loans made (or to
be made) by such Lender on the Closing Date in accordance with Section 2.11.

 

(iv)                              Closing Checklist.  Delivery by the Loan
Parties and their Subsidiaries of all documents and other items described or
listed on the Closing Checklist.

 

(b)                                 Truthfulness of Representations and
Warranties.  The representations and warranties of each Loan Party contained in
Article V or any other Loan Document, or which are contained in any document
furnished at any time under or in connection herewith or therewith, shall be
true and correct in all material respects (except to the extent any such
representation or warranty is already qualified by materiality, in which case it
shall be true and correct in all respects) on and as of Closing Date, except to
the extent that such representations and warranties specifically refer to an
earlier date, in which case they shall be true and correct as of such earlier
date.

 

(c)                                  No Defaults.  No Default or Event of
Default shall exist, or would result from such proposed Credit Extension or from
the application of the proceeds thereof.

 

(d)                                 Delivery of Request for Credit Extension. 
The Administrative Agent and the Lenders shall have received the Request for
Credit Extension in accordance with the requirements hereof.

 

(e)                                   Chapter 11 Case.  No trustee, examiner or
receiver shall have been appointed or designated with respect to the Loan
Parties’ business, properties or assets.

 

(f)                                   Interim Bankruptcy Court Order.  The
Interim Bankruptcy Court Order shall have been entered by the Bankruptcy Court,
and the Administrative Agent shall have received a true and complete copy of
such order, and such order shall be in full force and effect and shall not have
been reversed, modified, amended, stayed, or vacated, absent prior written
consent of the Administrative Agent and the

 

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Required Lenders.  The Interim Bankruptcy Court Order shall (i) find and
conclude that the Loan Documents were negotiated in good faith and that the
Administrative Agent and the other Secured Parties are entitled to the
protections of Section 364(e) of the Bankruptcy Code and (ii) order that the
Liens and security interests in favor of the Administrative Agent (for the
benefit of the Secured Parties) granted under the Security Agreement the other
Loan Documents shall be valid and perfected Liens and security interests in the
Collateral, prior to all other Liens and security interests in the Collateral,
and that all of the Obligations shall be DIP Superpriority Claims.

 

(g)                                  Initial Budget.  The Administrative Agent
and the Lenders shall have received from the Loan Parties a copy of the initial
Budget, together with a certificate of an Responsible Officer of the Borrowers
stating that such Budget has been prepared on a reasonable basis and in good
faith and is based on assumptions believed by the Loan Parties to be reasonable
at the time made and from the best information then available to the Loan
Parties, which Budget shall be in form and substance satisfactory to the
Administrative Agent and the Lenders in their sole discretion and which Budget
shall have been approved by the Bankruptcy Court.

 

Without limiting the generality of the provisions of the last paragraph of
Section 9.3, for purposes of determining compliance with the conditions
specified in this Section 4.1, each Lender that has signed this Agreement shall
be deemed to have consented to, approved or accepted or to be satisfied with,
each document or other matter required thereunder to be consented to or approved
by or acceptable or satisfactory to a Lender unless the Administrative Agent
shall have received notice from such Lender prior to the proposed Closing Date
specifying its objection thereto.  The Request for Credit Extension submitted by
the Borrowers shall be deemed to be a representation and warranty that the
conditions specified in Section 4.1 have been satisfied on and as of the Closing
Date.

 

4.2                               Conditions of Credit Extension.

 

In addition to the satisfaction of all conditions precedent in Section 4.1, the
obligation of each Lender to honor any Request for Credit Extension is subject
to the following conditions precedent:

 

(a)                                 The representations and warranties of each
Loan Party contained in Article V or any other Loan Document, or which are
contained in any document furnished at any time under or in connection herewith
or therewith, shall be true and correct in all material respects (except to the
extent any such representation or warranty is already qualified by materiality,
in which case it shall be true and correct in all respects) on and as of the
date of such Credit Extension, except to the extent that such representations
and warranties specifically refer to an earlier date, in which case they shall
be true and correct as of such earlier date, and except that for purposes of
this Section 4.2, the representations and warranties contained in subsections
(a) and (b) of Section 5.5 shall be deemed to refer to the most recent
statements, if any, furnished pursuant to clauses (a) and (b), respectively, of
Section 6.1.

 

(b)                                 No Default or Event of Default shall exist,
or would result from such proposed Credit Extension or from the application of
the proceeds thereof.

 

(c)                                  Since the Petition Date, no Material
Adverse Effect shall have occurred;

 

(d)                                 The proposed Credit Extension complies with
the Budget and the Bankruptcy Court Orders;

 

(e)                                  The Administrative Agent shall have
received a Request for Credit Extension in accordance with the requirements
hereof.

 

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(f)                                   After giving effect to the proposed Credit
Extension, the aggregate principal amount of Loans advanced under this Agreement
shall not exceed the Bankruptcy Court Order Period Cap.

 

(g)                                  The Administrative Agent shall be satisfied
that it has been granted, and still continues to hold, as the case may be, for
the benefit of the Administrative Agent and the Lenders, a perfected, first
priority Lien on and security interest in all of the Collateral and is subject
to a DIP Superpriority Claim.

 

(h)                                 There shall exist no claim, action, suit,
investigation, litigation or proceeding pending or threatened in any court or
before any arbitrator or Governmental Authority and which is not stayed by the
automatic stay which relates to the Loans and which, in the opinion of the
Administrative Agent, has any reasonable likelihood of having a Material Adverse
Effect.

 

(i)                                     The Bankruptcy Court Order Period shall
have not ended.

 

Each Request for Credit Extension submitted by the Borrowers shall be deemed to
be a representation and warranty that the conditions specified in this
Section 4.2 have been satisfied on and as of the date of the applicable Credit
Extension.

 

ARTICLE V

 

REPRESENTATIONS AND WARRANTIES

 

The Loan Parties represent and warrant to the Administrative Agent and the
Lenders that:

 

5.1                               Existence, Qualification and Power.

 

Each Loan Party and each Subsidiary (a) is duly organized or formed, validly
existing and in good standing (to the extent such concept exists under the Laws
of the jurisdiction of its incorporation or organization) under the Laws of the
jurisdiction of its incorporation or organization, (b) has all requisite power
and authority and all requisite governmental licenses, authorizations, consents
and approvals to (i) own or lease its assets and carry on its business and
(ii) execute, deliver and perform its obligations under the Loan Documents to
which it is a party, and (c) is duly qualified and is licensed and, as
applicable, in good standing under the Laws of each jurisdiction where its
ownership, lease or operation of properties or the conduct of its business
requires such qualification or license; except, in each case referred to in
clauses (b)(i) and (c), to the extent that failure to do so could not reasonably
be expected to have a Material Adverse Effect.

 

5.2                               Authorization; No Contravention.

 

The execution, delivery and performance by each Loan Party of each Loan Document
to which such Person is party have been duly authorized by all necessary
corporate or other organizational action, and do not (a) contravene the terms of
any of such Person’s Organization Documents; (b) conflict with or result in any
breach or contravention of, or the creation of any Lien under, or require any
payment to be made under (i) any Contractual Obligation to which such Person is
a party or affecting such Person or the properties of such Person or any of its
Subsidiaries (other than the Loan Documents and the Prepetition Debt Documents)
or (ii) any order, injunction, writ or decree of any Governmental Authority or
any arbitral award to which such Person or its property is subject; or
(c) violate any Law; except, in each case referred to in clauses (b) and (c), to
the extent that such conflict, breach, contravention, payment or violation, or
the creation of such Lien, as the case may be, could not reasonably be expected
to have a Material Adverse Effect.

 

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5.3                               Governmental Authorization; Other Consents.

 

Except for entry of the Bankruptcy Court Orders, no approval, consent,
exemption, authorization, or other action by, or notice to, or filing with, any
Governmental Authority or any other Person is necessary or required in
connection with the execution, delivery or performance by, or enforcement
against, any Loan Party of this Agreement or any other Loan Document other than
(a) those that have already been obtained and are in full force and effect and
(b) filings to perfect the Liens created by the Collateral Documents; except, in
each case, to the extent that the failure to obtain such approval, consent,
exemption, authorization or other action, or to provide such notice, as the case
may be, could not reasonably be expected to have a Material Adverse Effect.

 

5.4                               Binding Effect.

 

Each Loan Document has been duly executed and delivered by each Loan Party that
is party thereto.  Each Loan Document constitutes a legal, valid and binding
obligation of each Loan Party that is party thereto, enforceable against each
such Loan Party in accordance with its terms, except as enforceability may be
limited by applicable bankruptcy, insolvency, reorganization, moratorium or
similar laws affecting the enforcement of creditors’ rights generally and by
general equitable principles (whether enforcement is sought by proceedings in
equity or at law).

 

5.5                               Financial Statements; No Material Adverse
Effect; Budget.

 

(a)                                 The financial statements delivered pursuant
to Section 6.1 (i) were prepared in accordance with GAAP consistently applied
throughout the period covered thereby, except as otherwise expressly noted
therein and (ii) fairly present the financial condition of the Persons covered
thereby as of the date thereof and their results of operations for the period
covered thereby in accordance with GAAP consistently applied throughout the
period covered thereby, except as otherwise expressly noted therein (subject, in
the case of unaudited financial statements, to the absence of footnotes and to
normal year-end audit adjustments and the absence of footnotes).

 

(b)                                 The Audited Financial Statements and the
unaudited consolidated and consolidating financial statements of the Parent and
its Subsidiaries for the fiscal quarter ending March 31, 2018 (i) were prepared
in accordance with GAAP consistently applied throughout the period covered
thereby, except as otherwise expressly noted therein and (ii) fairly present the
financial condition of the Parent and its Subsidiaries as of the date thereof
and their results of operations for the period covered thereby (subject, in the
case of unaudited financial statements, to the absence of footnotes and to
normal year-end audit adjustments and the absence of footnotes).

 

(c)                                  From the date of the Audited Financial
Statements to and including the Closing Date, except as disclosed to the
Administrative Agent and the Lenders prior to the date hereof, there has been no
Disposition or any Recovery Event of any material part of the business or
property of the Loan Parties and their Subsidiaries, taken as a whole, and no
purchase or other acquisition by any of them of any business or property
(including any Equity Interests of any other Person) material in relation to the
consolidated financial condition of the Parent and its Subsidiaries, taken as a
whole, in each case, which is not reflected in the foregoing financial
statements or in the notes thereto or that has not otherwise been disclosed in
writing to the Lenders on or prior to the Closing Date.

 

(d)                                 (i) The Budget, when delivered to any
Secured Party, shall (A) be a true, correct and complete copy thereof, (B) be in
compliance with the Applicable Bankruptcy Court Order and, in the case of the
initial Budget, approved by the Bankruptcy Court, (C) be believed by the Loan
Parties at the time furnished to be reasonable, (D) have been prepared on a
reasonable basis and in good faith by the Loan

 

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Parties, and (E) have been based on assumptions believed by the Loan Parties to
be reasonable at the time made and upon the best information then reasonably
available to the Loan Parties, and (ii) the Loan Parties shall not be aware of
any facts or information that would lead it to believe that such Budget is
incorrect or misleading in any material respect.

 

5.6                               Litigation.

 

Other than the Chapter 11 Case or as otherwise disclosed to the Administrative
Agent and the Lenders prior to the date hereof (including as a result of any
public disclosure pursuant to the requirements of the SEC or any other
Governmental Authority), there are no actions, suits, proceedings,
investigations, criminal prosecutions, civil investigative demands, imposition
of criminal or civil penalties, claims or disputes pending or, to the knowledge
of the Responsible Officers of the Loan Parties, threatened or contemplated, at
law, in equity, in arbitration or before any Governmental Authority, by or
against any of the Loan Parties or any of their Subsidiaries or any of their
respective Affiliates or against any of their properties or revenues that
(a) purport to affect or pertain to this Agreement or any other Loan Document,
or any of the transactions contemplated hereby or (b) could reasonably be
expected to have a Material Adverse Effect.

 

5.7                               No Default.

 

(a)                                 No Loan Party nor any Subsidiary is in
default under or with respect to any Contractual Obligation (other than as a
result of the Chapter 11 Case or as otherwise disclosed to the Administrative
Agent and the Lenders prior to the date hereof) that individually or in the
aggregate could reasonably be expected to have a Material Adverse Effect.

 

(b)                                 No Event of Default has occurred and is
continuing.

 

5.8                               Ownership of Property.

 

Each Loan Party and each of its Subsidiaries has good record and marketable
title in fee simple to, or valid leasehold interests in, all real property
necessary or used in the ordinary conduct of its business, except for such
defects in title as could not, individually or in the aggregate, reasonably be
expected to have a Material Adverse Effect.

 

5.9                               Environmental Compliance.

 

(a)                                 There are no actual or, to the knowledge of
the Loan Parties, threatened claims alleging potential liability or
responsibility for violation of any Environmental Law on the businesses,
operations and properties of the Loan Parties that could, individually or in the
aggregate, reasonably be expected to have a Material Adverse Effect.

 

(b)                                 To the knowledge of the Responsible Officers
of the Loan Parties, none of the properties currently or formerly owned or
operated by any Loan Party or any Subsidiary is listed or proposed for listing
on the National Priorities List under CERCLA or on the CERCLIS or any analogous
foreign, state or local list or is adjacent to any such property; there are no
and, to the knowledge of the Loan Parties, never have been any underground or
above-ground storage tanks or any surface impoundments, septic tanks, pits,
sumps or lagoons in which Hazardous Materials are being or have been treated,
stored or disposed on any property currently owned or operated by any Loan Party
or any Subsidiary or, to the best of the knowledge of the Loan Parties, on any
property formerly owned or operated by any Loan Party or any Subsidiary; there
is no asbestos or asbestos- containing material on any property currently owned
or operated by any Loan Party or any Subsidiary; and, to the knowledge of the
Responsible Officers of the

 

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Loan Parties, Hazardous Materials have not been released, discharged or disposed
of on any property currently or formerly owned or operated by any Loan Party or
any Subsidiary, in each case, in any manner that could, individually or in the
aggregate, reasonably be expected to have a Material Adverse Effect.

 

(c)                                  No Loan Party nor any Subsidiary is
undertaking, and has not completed, either individually or together with other
potentially responsible parties, any investigation or assessment or remedial or
response action relating to any actual or threatened release, discharge or
disposal of Hazardous Materials at any site, location or operation, either
voluntarily or pursuant to the order of any Governmental Authority or the
requirements of any Environmental Law; and, to the knowledge of the Responsible
Officers of the Loan Parties, all Hazardous Materials generated, used, treated,
handled or stored at, or transported to or from, any property currently or
formerly owned or operated by any Loan Party or any Subsidiary have been
disposed of in a manner not reasonably expected to have a Material Adverse
Effect.

 

5.10                        Insurance.

 

(a)                                 The properties of the Loan Parties and their
Subsidiaries are insured with financially sound and reputable insurance
companies not Affiliates of the Borrower, in such amounts, with such deductibles
and covering such risks as are customarily carried by companies engaged in
similar businesses and owning similar properties in localities where the
applicable Loan Party or the applicable Subsidiary operates.

 

(b)                                 Each Loan Party and its Subsidiaries
maintain, if available, fully paid flood hazard insurance on all real property
that is located in a special flood hazard area and that constitutes Collateral,
on such terms and in such amounts as required by The National Flood Insurance
Reform Act of 1994 or as otherwise required by the Administrative Agent.

 

5.11                        Taxes.

 

Each Loan Party and its Subsidiaries have filed all federal, state and other
material tax returns and reports required to be filed, and have paid all
federal, state and other material taxes, assessments, fees and other
governmental charges levied or imposed upon them or their properties, income or
assets otherwise due and payable, except those which are being contested in good
faith by appropriate proceedings diligently conducted and for which adequate
reserves have been provided in accordance with GAAP. There is no proposed tax
assessment against any Loan Party or any Subsidiary that would, if made, have a
Material Adverse Effect.  Neither any Loan Party nor any Subsidiary is party to
any tax sharing agreement.  Halton Laboratories LLC is a Flow Through Entity.

 

5.12                        ERISA Compliance.

 

(a)                                 Each Plan (other than a Multiemployer Plan)
is in compliance in all material respects with the applicable provisions of
ERISA, the Internal Revenue Code and other federal or state Laws.  Each Pension
Plan (other than a Multiemployer Plan)that is intended to be a qualified plan
under Section 401(a) of the Internal Revenue Code has received a favorable
determination, advisory or opinion letter from the IRS to the effect that the
form of such Plan is qualified under Section 401(a) of the Internal Revenue Code
and the trust related thereto has been determined by the IRS to be exempt from
federal income tax under Section 501(a) of the Internal Revenue Code, or an
application for such a letter is currently being processed by the IRS.  Except
as would not reasonably be expected to have a Material Adverse Effect, nothing
has occurred that would reasonably be expected to prevent or cause the loss of
such tax-qualified status.

 

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(b)           There are no pending or, to the knowledge of the Loan Parties,
threatened claims, actions or lawsuits, or action by any Governmental Authority,
with respect to any Plan (other than a Multiemployer Plan) that could reasonably
be expected to have a Material Adverse Effect.  There has been no prohibited
transaction or violation of the fiduciary responsibility rules with respect to
any Plan (other than a Multiemployer Plan) that has resulted or could reasonably
be expected to result in a Material Adverse Effect.

 

(c)           Except as would not reasonably be expected to have a Material
Adverse Effect: (i) no ERISA Event has occurred, and no Loan Party nor any ERISA
Affiliate is aware of any fact, event or circumstance that could reasonably be
expected to constitute or result in an ERISA Event with respect to any Pension
Plan or Multiemployer Plan; (ii) each Loan Party and each ERISA Affiliate has
met all applicable requirements under the Pension Funding Rules in respect of
each Pension Plan (other than a Multiemployer Plan), and no waiver of the
minimum funding standards under the Pension Funding Rules has been applied for
or obtained with respect to any such plan; (iii) as of the most recent valuation
date for any Pension Plan (other than a Multiemployer Plan), the funding target
attainment percentage (as defined in Section 430(d)(2) of the Internal Revenue
Code) is 60% or higher and no Loan Party nor any ERISA Affiliate knows of any
facts or circumstances that could reasonably be expected to cause the funding
target attainment percentage for any such plan to drop below 60% as of the most
recent valuation date; (iv) no Loan Party nor any ERISA Affiliate has incurred
any liability to the PBGC other than for the payment of premiums, and there are
no premium payments which have become due that are unpaid; (v) no Loan Party nor
any ERISA Affiliate has engaged in a transaction that could reasonably be
expected to be subject to Section 4069 or Section 4212(c) of ERISA; and (vi) no
Pension Plan (other than a Multiemployer Plan) has been terminated by the plan
administrator thereof nor by the PBGC, and no event or circumstance has occurred
or exists that could reasonably be expected to cause the PBGC to institute
proceedings under Title IV of ERISA to terminate any Pension Plan (other than a
Multiemployer Plan).

 

(d)           Except as would not reasonably be expected to have a Material
Adverse Effect, all individuals who perform or have performed services for any
Loan Party or any Subsidiary of any Loan Party are or were correctly classified
under each Plan, ERISA, the Internal Revenue Code and other applicable Law as
common law employees, independent contractors or other non-employee basis, or
leased employees.

 

5.13        Subsidiaries and Joint Ventures.

 

(a)           Set forth on Schedule 5.13 to the Disclosure Schedule Side Letter
is a complete and accurate list as of the Closing Date of each Subsidiary and
Joint Venture, together with (i) jurisdiction of organization and
(ii) percentage of outstanding shares of each class of Equity Interests owned
(directly or indirectly) by any Loan Party or any Subsidiary.  The outstanding
Equity Interests of each Subsidiary and Joint Venture owned by any Loan Party or
any Subsidiary are validly issued, fully paid and to the extent applicable,
non-assessable.

 

5.14        Margin Regulations; Investment Company Act.

 

(a)           The Borrowers are not engaged and will not engage, principally or
as one of their important activities, in the business of purchasing or carrying
margin stock (within the meaning of Regulation U issued by the FRB), or
extending credit for the purpose of purchasing or carrying margin stock.

 

(b)           None of the Borrowers or any Subsidiary is, or is required to be
registered as, an “investment company” under the Investment Company Act of 1940.

 

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5.15        Disclosure.

 

All written reports, financial statements, certificates or other information
(other than financial projections and other forward-looking information and
information of a general economic or industry-specific nature) furnished by or
on behalf of any Loan Party to the Administrative Agent or any Lender in
connection with the transactions contemplated hereby and the negotiation of this
Agreement or delivered hereunder or under any other Loan Document did not, when
furnished, contain any untrue statement of a material fact or omit to state a
material fact necessary in order to make the statements contained therein not
materially misleading in light of the circumstances under which such statements
are made (in each case, as modified or supplemented by other information so
furnished).  Any financial projections furnished by or on behalf of any Loan
Party to the Administrative Agent or any Lender in connection with the
transactions contemplated hereby and the negotiation of this Agreement or
delivered hereunder or under any other Loan Document have been prepared in good
faith based upon assumptions that are believed by the preparer thereof to be
reasonable at the time such financial projections were prepared (it being
understood and agreed that financial projections are not to be viewed as facts
and are subject to significant uncertainties and contingencies many of which are
beyond the control of the preparer thereof, that no assurance can be given that
any particular financial projections will be realized, that actual results may
differ from projected results and that such differences may be material).

 

5.16        Compliance with Laws.

 

Each Loan Party and Subsidiary is in compliance with the requirements of all
Laws and all orders, writs, injunctions and decrees applicable to it or to its
properties, except in such instances in which (a) such requirement of Law or
order, writ, injunction or decree is being contested in good faith by
appropriate proceedings diligently conducted or (b) the failure to comply
therewith could not reasonably be expected to have a Material Adverse Effect.

 

5.17        Intellectual Property; Licenses, Etc.

 

Each Loan Party and each Subsidiary owns, or possesses the right to use, all of
the trademarks, service marks, trade names, copyrights, patents, patent rights,
franchises, licenses and other intellectual property rights (collectively, “IP
Rights”) that are reasonably necessary for the operation of their respective
businesses.  Set forth on Schedule 5.17 to the Disclosure Schedule Side Letter
is a list of (i) all IP Rights registered or pending registration with the
United States Copyright Office or the United States Patent and Trademark Office
that, as of the Closing Date, a Loan Party owns and (ii) all licenses of IP
Rights registered with the United States Copyright Office or the United States
Patent and Trademark Office as of the Closing Date.  Except for such claims and
infringements that could not reasonably be expected to have a Material Adverse
Effect, no claim has been asserted and is pending by any Person challenging or
questioning the use of any IP Rights or the validity or effectiveness of any IP
Rights, nor does any Loan Party know of any such claim, and, to the knowledge of
the Responsible Officers of the Loan Parties, the use of any IP Rights by any
Loan Party or any Subsidiary or the granting of a right or a license in respect
of any IP Rights from any Loan Party or any Subsidiary does not infringe on the
rights of any Person, in each case except as disclosed to the Administrative
Agent and the Lenders prior to the date hereof.  As of the Closing Date, none of
the IP Rights owned by any Loan Party is subject to any material licensing
agreement or similar arrangement granting rights to a third party except as set
forth on Schedule 5.17 to the Disclosure Schedule Side Letter.

 

5.18        Capitalization.

 

All of the issued and outstanding shares of Equity Interests of each Borrower
are duly authorized and validly issued, fully paid and nonassessable, have been
issued in compliance with all federal and state

 

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and foreign securities Laws, were not issued in violation of any preemptive
rights or other rights to subscribe for or purchase securities that have not
been waived in writing.

 

5.19        Perfection of Security Interests in the Collateral.

 

The Loan Documents and the Bankruptcy Court Orders create valid security
interests in, and Liens on, the Collateral purported to be covered thereby,
which security interests and Liens are currently perfected security interests
and Liens, prior to all other Liens (other than Liens permitted by Section 7.1).

 

5.20        Taxpayer Identification Number.

 

Set forth on Schedule 5.20-1 to the Disclosure Schedule Side Letter is a list of
all real property located in the United States that is owned or leased by any
Loan Party as of the Closing Date.  Set forth on Schedule 5.20-2 to the
Disclosure Schedule Side Letter is the jurisdiction of organization, chief
executive office, exact legal name, U.S. tax payer identification number and
organizational identification number of each Loan Party as of the Closing Date. 
Except as set forth on Schedule 5.20-3 to the Disclosure Schedule Side Letter,
no Loan Party has during the five years preceding the Closing Date (i) changed
its legal name, (ii) changed its state of formation or (iii) been party to a
merger, consolidation or other change in structure.

 

5.21        OFAC.

 

None of the Loan Parties, nor any of their Subsidiaries, nor, to the knowledge
of the Loan Parties and their Subsidiaries, any director, officer, employee,
agent, affiliate or representative thereof, is an individual or entity that is,
or is owned or controlled by any individual or entity that is (i) the subject or
target of any Sanctions, (ii) included on OFAC’s List of Specially Designated
Nationals, HMT’s Consolidated List of Financial Sanctions Targets and the
Investment Ban List, or any similar list enforced by any other relevant
sanctions authority or (iii) located, organized or resident in a Designated
Jurisdiction.

 

5.22        Anti-Corruption Laws.

 

The Loan Parties and their Subsidiaries and, to the knowledge of the Loan
Parties and their Subsidiaries, any director, officer, employee or affiliate
thereof have conducted their businesses in compliance with the United States
Foreign Corrupt Practices Act of 1977, the UK Bribery Act 2010, and other
similar anti-corruption legislation in other jurisdictions.

 

5.23        EEA Financial Institution.

 

No Loan Party is an EEA Financial Institution.

 

5.24        Administrative Priority; Lien Priority.

 

(a)           After the Interim Bankruptcy Court Order Entry Date or the Final
Bankruptcy Court Order Entry Date, as the case may be, the Obligations of the
Loan Parties shall be DIP Superpriority Claims and, subject to the Carve-Out,
constitute allowed administrative expenses in the Chapter 11 Case, having
priority in payment over all other administrative expenses and unsecured claims
against the Loan Parties now existing or hereafter arising, of any kind or
nature whatsoever, including all administrative expenses of the kind specified
in, or arising or ordered under, Sections 105, 326, 328, 330, 331, 503(b),
506(c), 507(a), 507(b), 546(c), 726 and 1114 of the Bankruptcy Code.

 

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(b)           Upon entry of the Interim Bankruptcy Court Order or the Final
Bankruptcy Court Order, as the case may be, the Liens and security interests of
the Administrative Agent on the Collateral shall be, subject to the Carve-Out,
valid and perfected first priority Liens, prior to all other Liens (other than
Liens permitted by Section 7.1).

 

(c)           During the Interim Bankruptcy Court Order Period, the Interim
Bankruptcy Court Order is, and shall be, in full force and effect, and has not
been, and shall not be, reversed, modified, amended, stayed, or vacated, absent
the written consent of the Administrative Agent and the Required Lenders, and
after the Final Bankruptcy Court Order Entry Date, the Final Bankruptcy Court
Order is, and shall be, in full force and effect, and has not been, and shall
not be, reversed, modified, amended, stayed or vacated absent the written
consent of the Administrative Agent and the Required Lenders.  The Loan Parties
are, and shall be, in compliance with all of the material terms and conditions
of the Bankruptcy Court Orders.

 

5.25        Appointment of Trustee or Examiner; Liquidation.

 

No order has been entered in any Chapter 11 Case (i) for the appointment of a
Chapter 11 trustee, (ii) for the appointment of an examiner with enlarged powers
(beyond those set forth in Sections 1106(a)(3) and (4) of the Bankruptcy Code)
under Section 1106(b) of the Bankruptcy Code or (iii) to convert any Chapter 11
Case to a case under Chapter 7 of the Bankruptcy Code or to dismiss any Chapter
11 Case.

 

5.26        Motions and Documents.

 

The Borrowers have furnished to the Administrative Agent all material motions to
be filed with and submitted to the Bankruptcy Court (including any “first day”
motions and proposed orders) related to the commencement of the Chapter 11 Case
or material motions and other material documents related to the transactions
contemplated hereby and the other Loan Documents and the approval thereof.

 

ARTICLE VI

 

AFFIRMATIVE COVENANTS

 

Until the Facility Termination Date, each Loan Party shall and shall cause each
Subsidiary to:

 

6.1          Financial Statements.

 

Deliver to the Administrative Agent and each Lender, in form and detail
satisfactory to the Administrative Agent and the Lenders:

 

(a)           Annual Financial Statements.

 

(i)            with respect to the Borrower and its Subsidiaries, as soon as
available, but in any event within ninety days after the end of each fiscal year
of the Parent (or, if earlier, the date filed with the SEC), an unaudited
consolidated balance sheet of the Parent and its Subsidiaries as at the end of
such fiscal year, and the related unaudited consolidated statements of income or
operations, changes in shareholders’ equity and cash flows for such fiscal year,
setting forth in each case in comparative form the figures for the previous
fiscal year, all in reasonable detail and prepared in accordance with GAAP; and

 

(ii)           concurrently with the delivery of the financial statements
referred to in Section 6.1(a)(i), consolidating balance sheets of the
Subsidiaries of the Parent as at the end of

 

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such fiscal year, and the related consolidating statements of income or
operations for such fiscal year, all in reasonable detail certified by the chief
executive officer, chief financial officer, treasurer or controller of the
Parent in accordance as fairly presenting the financial condition and results of
operations of the Subsidiaries of the Parent in accordance with GAAP.

 

(b)           [Reserved].

 

(c)           Monthly Financial Statements.

 

(i)            as soon as available, but in any event no later than the date
filed with the Bankruptcy Court or the SEC, an operating report or other
financial report or information filed with the Bankruptcy Court or the SEC for
each calendar month ended after the Petition Date (provided that, for the
calendar month ending August 31, 2018, such report and information shall only
cover the period from the Petition Date until the end of such calendar month and
shall be included and combined with the report and information for the calendar
month ended September 30, 2018 and provided at the same time as such report and
information covering the calendar month ended September 30, 2018 is delivered or
required to be delivered hereunder).

 

6.2          Certificates; Other Information.

 

Deliver to the Administrative Agent and each Lender, in form and detail
reasonably satisfactory to the Administrative Agent and the Lenders:

 

(a)           [reserved];

 

(b)           concurrently with the delivery of the financial statements
referred to in Sections 6.1(a) and 6.1(c), a duly completed Compliance
Certificate signed by the chief executive officer, chief financial officer,
treasurer or controller of the Borrowers (which delivery may, unless the
Administrative Agent, or a Lender requests executed originals, be by electronic
communication including fax or email and shall be deemed to be an original
authentic counterpart thereof for all purposes);

 

(c)           at the times set forth in the Applicable Bankruptcy Court Order,
such reports, documents and information required to be provided to any Secured
Party pursuant to such Bankruptcy Court Order;

 

(d)           promptly after the same are available, copies of each annual
report, proxy or financial statement or other report or communication sent to
the equity holders of any Loan Party or any Subsidiary, and copies of all
annual, regular, periodic and special reports and registration statements which
a Loan Party or any Subsidiary may file with the SEC under Section 13 or
15(d) of the Exchange Act, and not otherwise required to be delivered to the
Administrative Agent pursuant hereto;

 

(e)           promptly after any request by the Administrative Agent or any
Lender, copies of any detailed audit reports, management letters or
recommendations submitted to the board of directors (or the audit committee of
the board of directors) of any Borrower by independent accountants in connection
with the accounts or books of any Borrower or any Subsidiary, or any audit of
any of them;

 

(f)            promptly after the furnishing thereof, copies of any statement or
report furnished to any holder of debt securities in excess of the Threshold
Amount of any Loan Party or any Subsidiary pursuant to the terms of any
indenture, loan or credit or similar agreement and not otherwise required to be
furnished to the Lenders pursuant to Section 6.1 or any other clause of this
Section 6.2;

 

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(g)           promptly, and in any event within five (5) Business Days after
receipt thereof by Parent or any Loan Party or any Subsidiary, copies of each
notice or other correspondence received from the SEC (or comparable agency in
any applicable non-U.S. jurisdiction) concerning any investigation or possible
investigation or other inquiry by such agency regarding financial or other
operational results of any Loan Party or any Subsidiary;

 

(h)           [reserved];

 

(i)            promptly after the sending thereof, copies of all written reports
given by any Loan Party to any official or unofficial creditors’ committee in
the Chapter 11 Case, other than any such reports subject to privilege; provided
that such Person may redact any confidential information contained in any such
report if it provides a summary of the nature of the information redacted to the
Administrative Agent;

 

(j)            on the Wednesday of each calendar week commencing with the week
of August 27, 2018, a variance report (the “Variance Report”), in form and
substance reasonably acceptable to the Administrative Agent and the Required
Lenders, comparing the actual receipts and disbursements of the Loan Parties for
the immediately preceding calendar week to the Budget for such week;

 

(k)           promptly, such additional information regarding the business,
financial or corporate affairs of Parent or any Loan Party or any Subsidiary, or
compliance with the terms of the Loan Documents, as the Administrative Agent or
any Lender may from time to time reasonably request; and

 

(l)            not later than two (2) business days prior to the first Monday of
each calendar month commencing on September 3, 2018 (or more frequently upon
mutual agreement of the Borrowers and Administrative Agent), the Borrowers shall
deliver to the Administrative Agent for its approval an updated rolling 13-week
Budget for the period commencing on the first Monday of such calendar month. 
Each such Budget shall set forth on a line-item basis the Borrowers’ anticipated
cash receipts and cash disbursements on a weekly basis which the Borrowers
expect to incur during each week included in such Budget.  The Borrowers shall
promptly deliver to the Administrative Agent any supplemental information or
updates applicable to any Budget.  Until such time as the Administrative Agent
and the Lenders have approved in writing any proposed Budget (which approval
shall not be unreasonably withheld or delayed), the Budget last approved by the
Administrative Agent and the Lenders shall control.

 

6.3          Notices.

 

Promptly (but, in any event, not less than one Business Day after the occurrence
thereof) notify in writing the Administrative Agent and each Lender of:

 

(a)           (i) the occurrence of any Default or any Event of Default and
(ii) the occurrence of any Default or any Event of Default under (and as defined
in) the Aralez Canadian DIP Credit Agreement;

 

(b)           any matter that has resulted or could reasonably be expected to
result in a Material Adverse Effect;

 

(c)           the occurrence of any ERISA Event; and

 

(d)           any material change in accounting policies or financial reporting
practices by any Loan Party or any Subsidiary.

 

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Each notice pursuant to this Section 6.3 shall be accompanied by a statement of
a Responsible Officer of the Borrowers setting forth details of the occurrence
referred to therein and stating what action the Borrowers have taken and
proposes to take with respect thereto.  Each notice pursuant to
Section 6.3(a) shall describe with particularity any and all provisions of this
Agreement and any other Loan Document that have been breached.

 

6.4          Payment of Taxes.

 

Pay and discharge, as the same shall become due and payable, all its federal,
state and other material tax liabilities, assessments and governmental charges
or levies upon it or its properties or assets arising from and after the
Petition Date, unless the same are being contested in good faith by appropriate
proceedings diligently conducted and adequate reserves in accordance with GAAP
are being maintained by such Loan Party or such Subsidiary.

 

6.5          Preservation of Existence, Etc.

 

(a)           Preserve, renew and maintain in full force and effect its legal
existence under the Laws of the jurisdiction of its organization except in a
transaction permitted by Section 7.4 or 7.5.

 

(b)           Preserve, renew and maintain in full force and effect its good
standing under the Laws of the jurisdiction of its organization except in a
transaction permitted by Section 7.4 or 7.5.

 

(c)           Take all reasonable action to maintain all rights, privileges,
permits, licenses and franchises necessary or desirable in the normal conduct of
its business, except to the extent that the failure to do so could not
reasonably be expected to have a Material Adverse Effect.

 

(d)           Preserve or renew all of its IP Rights, the non-preservation or
non-renewal of which could reasonably be expected to have a Material Adverse
Effect.

 

6.6          Maintenance of Properties.

 

(a)           Maintain, preserve and protect all of its material properties and
equipment necessary in the operation of its business in good working order and
condition, ordinary wear and tear excepted.

 

(b)           Make all necessary repairs thereto and renewals and replacements
thereof, except where the failure to do so could not reasonably be expected to
have a Material Adverse Effect.

 

(c)           Use the standard of care typical in the industry in the operation
and maintenance of its facilities.

 

6.7          Maintenance of Insurance.

 

(a)           Maintain in full force and effect insurance (including worker’s
compensation insurance, liability insurance, casualty insurance and business
interruption insurance) with financially sound and reputable insurance companies
not Affiliates of any Borrower, in such amounts, with such deductibles and
covering such risks as are customarily carried by companies engaged in similar
businesses and owning similar properties in localities where such Loan Party or
such Subsidiary operates.

 

(b)           Without limiting the foregoing, (i) maintain, if available, fully
paid flood hazard insurance on all real property that is located in a special
flood hazard area and that constitutes Collateral, on such terms and in such
amounts as required by The National Flood Insurance Reform Act of 1994 or

 

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as otherwise required by the Administrative Agent but in no event less than
required by applicable law, (ii) furnish to the Administrative Agent evidence of
the renewal (and payment of renewal premiums therefor) of all such policies
prior to the expiration or lapse thereof, and (iii) furnish to the
Administrative Agent prompt written notice of any redesignation of any such
improved real property into or out of a special flood hazard area.

 

(c)           Cause the Administrative Agent and its successors and assigns to
be named as lender’s loss payee or mortgagee, as its interest may appear, and/or
additional insured with respect to any such insurance providing liability
coverage or coverage in respect of any Collateral, and cause each provider of
any such insurance to agree, by endorsement upon the policy or policies issued
by it or by independent instruments furnished to the Administrative Agent, that
it will give the Administrative Agent thirty days (or such lesser amount as the
Administrative Agent may agree) prior written notice before any such policy or
policies shall be altered or canceled.

 

6.8          Compliance with Laws.

 

Comply with the requirements of all Laws and all orders, writs, injunctions and
decrees applicable to it or to its business or property, except in such
instances in which (a) such requirement of Law or order, writ, injunction or
decree is being contested in good faith by appropriate proceedings diligently
conducted; or (b) the failure to comply therewith could not reasonably be
expected to have a Material Adverse Effect.

 

6.9          Books and Records.

 

(a)           Maintain proper books of record and account, in which full, true
and correct entries in conformity with GAAP consistently applied shall be made
of all financial transactions and matters involving the assets and business of
such Loan Party or such Subsidiary, as the case may be.

 

(b)           Maintain such books of record and account in material conformity
with all applicable requirements of any Governmental Authority having regulatory
jurisdiction over such Loan Party or such Subsidiary, as the case may be.

 

6.10        Inspection Rights.

 

Permit representatives and independent contractors of the Administrative Agent
to visit and inspect any of its properties, to examine its corporate, financial
and operating records, and make copies thereof or abstracts therefrom, and to
discuss its affairs, finances and accounts with its directors, officers, and
independent public accountants, all at the expense of the Borrowers and at such
reasonable times during normal business hours and as often as may be reasonably
desired, upon reasonable advance notice to the Borrower; provided, however, that
(i) absent an Event of Default, the Borrowers shall be required to pay for only
one such visit and/or inspections by the Administrative Agent in any fiscal year
of the Parent and (ii) when an Event of Default exists the Administrative Agent
or any Lender (or any of their respective representatives or independent
contractors) may do any of the foregoing at the expense of the Borrowers at any
time during normal business hours and without advance notice. Any Lender may
accompany the Administrative Agent on, and participate in, any such visit or
inspection at such Lender’s expense.

 

6.11        Use of Proceeds.

 

Subject to the immediately succeeding sentence, use the proceeds of the Credit
Extensions to finance working capital and general corporate purposes and to pay
for expenditures in accordance and

 

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compliance with the Budget and the Bankruptcy Court Orders, provided that, for
the avoidance of doubt, in no event shall the proceeds of the Credit Extensions
be used (y) in contravention of any Law or of any Loan Document or (z) to pay,
repay or prepay any Indebtedness or other obligations except in accordance with
the Budget and approved by the Bankruptcy Court.

 

6.12        ERISA Compliance.

 

Except where the failure to do so could not reasonably be expected to have a
Material Adverse Effect, do, and cause each of its ERISA Affiliates to do, each
of the following:  (a) maintain each Plan in compliance in all material respects
with the applicable provisions of ERISA, the Internal Revenue Code and other
federal or state Law; (b) cause each Plan that is qualified under
Section 401(a) of the Internal Revenue Code to maintain such qualification; and
(c) make all required contributions to any Pension Plan and any Multiemployer
Plan.

 

6.13        Additional Guarantors.

 

If any Person becomes a Subsidiary (other than an Excluded Subsidiary) after the
Closing Date, cause such Person to (a) become a Guarantor (but, for the
avoidance of doubt, excluding any Excluded Property from the property securing
the Guaranty) by executing and delivering to the Administrative Agent and the
Lenders a Joinder Agreement and (b) upon the request of the Administrative Agent
or the Required Lenders in its or their sole discretion, deliver to the
Administrative Agent and the Lenders such Organization Documents, resolutions
and favorable opinions of counsel, all in form, content and scope reasonably
satisfactory to the requesting Administrative Agent or Required Lenders (as
applicable).

 

6.14        Pledged Assets.

 

(a)           Equity Interests.  Cause (i) 100% of the issued and outstanding
Equity Interests of each Subsidiary directly owned by any Loan Party to be
subject at all times to a first priority, perfected Lien in favor of the
Administrative Agent pursuant to the terms and conditions of the Collateral
Documents, and, in connection with the foregoing, deliver to the Administrative
Agent and the other Lenders such other documentation as the Administrative Agent
or the Required Lenders may request including, any filings and deliveries to
perfect such Liens and favorable opinions of counsel all in form and substance
reasonably satisfactory to the requesting Administrative Agent or Required
Lenders (as applicable).

 

(b)           Other Property.  Cause all property (other than Excluded Property)
of each Loan Party to be subject at all times to first priority, perfected and,
in the case of owned real property, title insured Liens in favor of the
Administrative Agent to secure the Obligations pursuant to the Loan Documents
and the Bankruptcy Court Orders and, in connection with the foregoing, deliver
to the Administrative Agent and the Lenders such other documentation as the
Administrative Agent or the Required Lenders may request including filings and
deliveries necessary to perfect such Liens, Organization Documents, resolutions,
and favorable opinions of counsel to such Person, all in form, content and scope
reasonably satisfactory to the requesting Administrative Agent or Required
Lenders (as applicable).

 

6.15        Maintenance of Depository Relationship.

 

Maintain each Loan Party’s primary deposit relationship, including operating,
cash management and collection/lockbox services, with its existing depository
banks or such other financial institution as the Administrative Agent may agree
in its sole discretion.

 

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6.16        Anti-Corruption Laws and Sanctions.

 

Conduct its businesses in compliance with the United States Foreign Corrupt
Practices Act of 1977, the UK Bribery Act 2010 and other similar anti-corruption
legislation in other jurisdictions, OFAC’s List of Specially Designated
Nationals, HMT’s Consolidated List of Financial Sanctions Targets and the
Investment Ban List or any similar list enforced by any other relevant sanctions
authority and maintain policies and procedures designed to promote and achieve
compliance with such laws and regulations.

 

6.17        Account Control Agreements.

 

To the extent requested by the Administrative Agent at any time, each Loan Party
shall have entered into a customary account control agreement, in a form
reasonably satisfactory to the Administrative Agent with the Administrative
Agent and any bank or other financial institution with which such Loan Party
maintains a deposit account.

 

6.18        Post-Closing Items.

 

The Borrowers shall execute and deliver the documents and complete the tasks set
forth on Schedule 6.18, in each case, within the time limits specified therein
(or such longer period agreed to by Administrative Agent in its sole
discretion).

 

6.19        Case Milestones.

 

Borrowers shall comply with the Case Milestones on a timely basis.

 

6.20        Further Assurances.

 

Subject to the terms of the Bankruptcy Court Orders, take such action and
execute, acknowledge and deliver, and cause each of its Subsidiaries to take
such action and execute, acknowledge and deliver, at its sole cost and expense,
such agreements, instruments or other documents as the Administrative Agent may
require from time to time in order (a) to carry out more effectively the
purposes of this Agreement and the other Loan Documents, (b) to subject to valid
and perfected first priority Liens to the Administrative Agent (for the benefit
of the Secured Parties) on any of the Collateral or any other property of any
Loan Party and its Subsidiaries and to have the Obligations be DIP Superpriority
Claims, (c) to establish and maintain the validity and effectiveness of any of
the Loan Documents and the validity, perfection and priority of the Liens
intended to be created thereby, and (d) to better assure, convey, grant, assign,
transfer and confirm unto the Administrative Agent and each Lender the rights
now or hereafter intended to be granted to it under this Agreement or any other
Loan Document.  In furtherance of the foregoing, to the maximum extent permitted
by applicable law and subject to the Bankruptcy Court Orders, each Loan Party
(i) authorizes the Administrative Agent to execute any such agreements,
instruments or other documents in such Loan Party’s name and to file such
agreements, instruments or other documents in any appropriate filing office,
(ii) authorizes the Administrative Agent to file any financing statement
required hereunder or under any other Loan Document, and any continuation
statement or amendment with respect thereto, in any appropriate filing office
without the signature of such Loan Party, and (iii) ratifies the filing of any
financing statement, and any continuation statement or amendment with respect
thereto, filed without the signature of such Loan Party prior to the date
hereof.  The assurances contemplated by this Section 6.20 shall be given under
applicable non-bankruptcy law (to the extent not inconsistent with the
Bankruptcy Code and the Bankruptcy Court Orders) as well as the Bankruptcy Code,
it being the intention of the parties that the Administrative Agent may request
assurances under applicable non-bankruptcy law, and such request shall be
complied with (if otherwise made in good faith by the Administrative Agent)
whether or not any of the Bankruptcy Court Orders are

 

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in force and whether or not dismissal of the Chapter 11 Case or any other action
by the Bankruptcy Court is imminent, likely or threatened.

 

ARTICLE VII

 

NEGATIVE COVENANTS

 

Until the Facility Termination Date, without the prior written consent of the
Administrative Agent and the Required Lenders in their sole discretion, no Loan
Party shall, nor shall it permit any Subsidiary to, directly or indirectly:

 

7.1          Liens.

 

Create, incur, assume or suffer to exist any Lien upon any of its property,
assets or revenues, whether now owned or hereafter acquired, other than the
following:

 

(a)           Liens pursuant to any Loan Document;

 

(b)           Liens existing on the Closing Date and listed on Schedule 7.1 to
the Disclosure Schedule Side Letter and any renewals or extensions thereof,
provided that the property covered thereby is not increased;

 

(c)           Liens (other than Liens imposed under ERISA) for taxes,
assessments or governmental charges or levies not yet due or which are being
contested in good faith and by appropriate proceedings diligently conducted, if
adequate reserves with respect thereto are maintained on the books of the
applicable Person in accordance with GAAP;

 

(d)           Liens of landlords, carriers, warehousemen, mechanics, materialmen
and repairmen or other like Liens arising in the ordinary course of business
which are not overdue for a period of more than 60 days or, if overdue for more
than 60 days, which are being contested in good faith and by appropriate
proceedings diligently conducted, if adequate reserves with respect thereto are
maintained on the books of the applicable Person;

 

(e)           pledges or deposits in the ordinary course of business in
connection with workers’ compensation, unemployment insurance and other social
security legislation, other than any Lien imposed by ERISA;

 

(f)            deposits to secure the performance of bids, trade contracts,
licenses and leases (other than Indebtedness), statutory obligations, surety and
appeal bonds, performance bonds and other obligations of a like nature incurred
in the ordinary course of business;

 

(g)           easements, rights-of-way, restrictions and other similar
encumbrances affecting real property which, in the aggregate, are not
substantial in amount, and which do not in any case materially detract from the
value of the property subject thereto or materially interfere with the ordinary
conduct of the business of the applicable Person;

 

(h)           Liens securing judgments for the payment of money (or appeal or
other surety bonds relating to such judgments) not constituting an Event of
Default under Section 8.1(h);

 

(i)            Liens securing Indebtedness permitted under Section 7.3(e);
provided that (i) such Liens do not at any time encumber any property other than
the property financed by such Indebtedness and

 

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(ii) such Liens attach to such property concurrently with or within ninety days
after the acquisition thereof;

 

(j)            Licenses, sublicenses, leases or subleases granted to others not
interfering in any material respect with the business of any Loan Party or any
Subsidiary;

 

(k)           any interest of title of a lessor under, and Liens arising from
UCC financing statements (or equivalent filings, registrations or agreements in
foreign jurisdictions) relating to, leases permitted by this Agreement;

 

(l)            normal and customary rights of setoff upon deposits of cash in
favor of banks or other depository institutions;

 

(m)          Liens of a collection bank arising under Section 4-210 of the
Uniform Commercial Code on items in the course of collection;

 

(n)           Liens under the Prepetition Debt Documents and Permitted Liens (as
defined in the Prepetition Credit Facility), in each case subject to (and in
accordance with) the terms and provisions of the Bankruptcy Court Orders; and

 

(o)           other Liens agreed to in writing by Administrative Agent and the
Required Lenders in their sole discretion.

 

7.2          Investments.

 

Make any Investments, except:

 

(a)           Investments held in the form of cash or Cash Equivalents;

 

(b)           Investments existing as of the Closing Date and set forth on
Schedule 7.2 to the Disclosure Schedule Side Letter, to the extent such
Investments are permitted to be made pursuant to the terms of the Bankruptcy
Court Orders and is in accordance and compliance with the Budget;

 

(c)           Investments in any Person that is a Loan Party both prior to and
after giving effect to such Investment, provided that (i) such Investment is
made in accordance with the Budget and is permitted by the Bankruptcy Court
Orders and (ii) in the case of an Investment involving any Borrower, such
Borrower shall be the Person such Investment is made in (and not the Person
making such Investment);

 

(d)           Investments by any Subsidiary that is not a Loan Party in any
other Subsidiary that is not a Loan Party;

 

(e)           Investments consisting of extensions of credit in the nature of
accounts receivable or notes receivable arising from the grant of trade credit
in the ordinary course of business, and Investments received in satisfaction or
partial satisfaction thereof from financially troubled account debtors to the
extent reasonably necessary in order to prevent or limit loss; and

 

(f)            loans and advances to employees of any Borrower or any Subsidiary
for reimbursable expenses in the ordinary course of business that are funded in
accordance and compliance with the Budget and permitted by the Bankruptcy Court
Orders.

 

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7.3          Indebtedness.

 

Create, incur, assume or suffer to exist any Indebtedness, except:

 

(a)           Indebtedness under the Loan Documents;

 

(b)           Indebtedness outstanding on the Closing Date set forth on Schedule
7.3 to the Disclosure Schedule Side Letter (and renewals, refinancings and
extensions thereof); provided that (i) the amount of such Indebtedness is not
increased at the time of such refinancing, renewal or extension except by an
amount equal to a reasonable premium or other reasonable amount paid, and fees
and expenses reasonably incurred, in connection with such refinancing and by an
amount equal to any existing commitments unutilized thereunder and (ii) the
terms relating to principal amount, amortization, maturity, collateral (if any)
and subordination (if any), and other material terms taken as a whole, of any
such refinancing, renewal or extension are no less favorable in any material
respect to the Loan Parties and their Subsidiaries or the Lenders than the terms
of the Indebtedness being refinanced, renewed or extended;

 

(c)           intercompany Indebtedness permitted as an Investment under
Section 7.2; provided that (i) such Indebtedness shall be subordinated to the
Obligations in a manner and to an extent reasonably acceptable to the
Administrative Agent and (ii) such Indebtedness shall not be prepaid unless no
Default exists immediately prior to or after giving effect to such prepayment;

 

(d)           obligations (contingent or otherwise) existing or arising under
any Swap Contract; provided that (i) such obligations are (or were) entered into
in the ordinary course of business for the purpose of directly mitigating risks
associated with fluctuations in interest rates or foreign exchange rates, and
not for purposes of speculation or taking a “market view”; (ii) such Swap
Contract does not contain any provision exonerating the non-defaulting party
from its obligation to make payments on outstanding transactions to the
defaulting party; and (iii) such Swap Contract is permitted by the Bankruptcy
Court Orders;

 

(e)           purchase money Indebtedness (including obligations in respect of
capital leases and Synthetic Lease Obligations) incurred prior to the Petition
Date to finance the purchase of fixed assets, provided that such Indebtedness
when incurred shall not have exceeded the purchase price of the
asset(s) financed;

 

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

 

(g)           Indebtedness arising from the honoring by a bank or other
financial institution of a check, draft or similar instrument, in each case,
drawn against insufficient funds in the ordinary course of business, provided,
that such Indebtedness is extinguished within 5 Business Days of its incurrence;

 

(h)           the Prepetition Credit Facility Debt under the Prepetition Credit
Facility, subject to (and in accordance with) the terms and provisions of the
Bankruptcy Court Orders; and

 

(i)            Guarantees with respect to Indebtedness permitted under this
Section 7.3.

 

7.4          Fundamental Changes.

 

Merge, dissolve, liquidate or consolidate with or into another Person, except
that so long as no Event of Default exists or would result therefrom and such
transaction is permitted by the Bankruptcy

 

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Court Orders, (a) any Borrower may merge or consolidate with any of its
Subsidiaries; provided that such Borrower is the continuing or surviving Person
and (b) any Subsidiary of any Borrower may merge or consolidate with any other
Subsidiary of any Borrower provided that if a Guarantor is a party to such
transaction, the continuing or surviving Person is a Guarantor.

 

7.5          Dispositions.

 

Make any Disposition except Permitted Transfers.

 

7.6          Restricted Payments.

 

Declare or make, directly or indirectly, any Restricted Payment, or incur any
obligation (contingent or otherwise) to do so, except that each Loan Party and
each Subsidiary may declare and make dividend payments or other distributions
payable solely in common Equity Interests of such Person; provided that any such
Equity Interests that are Collateral shall be granted a Lien on in favor of the
Administrative Agent for the benefit of the Secured Parties and such Lien shall
be perfected on and have the required priority required by this Agreement and
the other Loan Documents and the Bankruptcy Court Orders.

 

7.7          Change in Nature of Business.

 

Engage in any material line of business substantially different from those lines
of business conducted by the Loan Parties and their Subsidiaries on the Closing
Date or any business substantially related or incidental thereto.

 

7.8          Transactions with Affiliates.

 

Enter into or permit to exist any transaction or series of transactions with any
Affiliate of such Person, whether or not in the ordinary course of business,
other than, in each case, to the extent permitted by the Bankruptcy Court Orders
and in accordance (and compliance) with the Budget, (a) transactions among Loan
Parties, (b) intercompany transactions expressly permitted by Section 7.2,
Section 7.3, Section 7.4, Section 7.5 or Section 7.6, (c) normal and reasonable
compensation and reimbursement of expenses of officers and directors and
(d) except as otherwise specifically limited in this Agreement, other
transactions which are on terms and conditions not substantially less favorable
to such Person as would be obtainable by it in a comparable arms-length
transaction with a Person other than an Affiliate.

 

7.9          Burdensome Agreements.

 

Enter into, or permit to exist, any Contractual Obligation that encumbers or
restricts the ability of any such Person to (i) make Restricted Payments to any
Loan Party, (ii) pay any Indebtedness or other obligation owed to any Loan
Party, (iii) make loans or advances to any Loan Party, (iv) transfer any of its
property to any Loan Party, (v) pledge its property pursuant to the Loan
Documents or any renewals, refinancings, exchanges, refundings or extension
thereof or (vi) act as a Loan Party pursuant to the Loan Documents or any
renewals, refinancings, exchanges, refundings or extension thereof, except (in
respect of any of the matters referred to in clauses (i) through (v) above) for
(1) this Agreement and the other Loan Documents, (2) any document or instrument
governing Indebtedness incurred pursuant to Section 7.3(e), provided that any
such restriction contained therein relates only to the asset or assets
constructed or acquired in connection therewith, (3) any Permitted Lien or any
document or instrument governing any Permitted Lien, provided that any such
restriction contained therein relates only to the asset or assets subject to
such Permitted Lien, or (4) the Prepetition Debt Documents, subject to (and in
accordance with) the terms and provisions of the Bankruptcy Court Orders.

 

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7.10        Use of Proceeds.

 

Use the proceeds of any Credit Extension, whether directly or indirectly, and
whether immediately, incidentally or ultimately, to purchase or carry margin
stock (within the meaning of Regulation U of the FRB) or to extend credit to
others for the purpose of purchasing or carrying margin stock or to refund
indebtedness originally incurred for such purpose.

 

7.11        Payments.

 

Make (i) any payments on account of any creditor’s claims against any Borrower,
(ii) payments on account of claims or expenses arising under section
503(b)(9) of the Bankruptcy Code, (iii) payments in respect of a reclamation
program or (iv) payments under any management incentive plan or on account of
claims or expenses arising under section 503(c) of the Bankruptcy Code, except
in each case, in amounts and on terms and conditions that (A) are approved by
order of the Bankruptcy Court and (B) are expressly permitted by the Budget or
otherwise approved by the Administrative Agent and Required Lenders in their
sole discretion and in writing.

 

7.12        Organization Documents; Fiscal Year; Legal Name, State of Formation
and Form of Entity.

 

(a)           Amend or modify any of its Organization Documents in a manner
adverse to the Lenders.

 

(b)           Change its fiscal year.

 

(c)           Without providing ten (10) days prior written notice to the
Administrative Agent (or such lesser period as the Administrative Agent may
agree), change its name, state of formation or form of organization.

 

7.13        Sanctions.

 

Directly or indirectly, use any Credit Extension or the proceeds of any Credit
Extension, or lend, contribute or otherwise make available such Credit Extension
or the proceeds of any Credit Extension to any Person, to fund any activities of
or business with any Person, or in any Designated Jurisdiction, that, at the
time of such funding, is the subject of Sanctions, or in any other manner that
will result in a violation by any Person (including any Person participating in
the transaction, whether as Lender, Administrative Agent or otherwise) of
Sanctions.

 

7.14        Anti-Corruption Laws.

 

Directly or indirectly use the proceeds of any Credit Extension for any purpose
which would breach the United States Foreign Corrupt Practices Act of 1977, the
UK Bribery Act 2010 or other similar anti-corruption legislation in other
jurisdictions.

 

7.15        Astra Zeneca Documents.

 

Amend, restate, supplement, extend or modify any of the Astra Zeneca Documents,
in each case in a manner adverse to the Lenders, unless approved in writing by
the Administrative Agent.

 

7.16        Financial Covenant.

 

Fail to be in compliance with the Budget or permit variances with respect to the
cumulative receipts and cumulative disbursements (excluding Professional Fees
and Expenses) in the Budget for any

 

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two week trailing period, commencing with the first two full weeks after the
date of this Agreement, to exceed the greater of (i) 15% more than the
corresponding amounts set forth in the Budget for such period and (ii) $100,000;
provided that there shall be no variance permitted for Professional Fees and
Expenses.

 

7.17        No Investment Company.

 

Be an “investment company” or a company “controlled” by an “investment company,”
as such terms are defined in the Investment Company Act, or to otherwise be
registered or required to be registered or subject to the restrictions imposed
by the Investment Company Act.

 

7.18        Use of Property; Post-Filing Pleadings.

 

On or after the Petition Date, each Loan Party agrees that it shall not, without
the Required Lenders’ prior written consent, file any motions or pleadings with
the Bankruptcy Court (a) except as may be requested in the First Day Motions,
seeking authority for any Loan Party to (i) use any of the material properties
or assets of the Loan Parties outside the ordinary course of business,
(ii) satisfy prepetition claims of the Loan Parties or (iii) incur
administrative costs, in each case, to the extent such relief is inconsistent
with this Agreement, the other Loan Documents, the Bankruptcy Court Orders or
the Budget, or (b) seeking relief that is otherwise inconsistent with this
Agreement and the Bankruptcy Court Orders.

 

7.19        Bankruptcy Court Orders; Administrative Priority; Lien Priority; 
Payment of Claims.

 

(a)           At any time, seek, consent to or suffer to exist any reversal,
modification, amendment, stay or vacation of any of the Bankruptcy Court Orders,
except for modifications and amendments agreed to by the Administrative Agent
and the Required Lenders.

 

(b)           At any time, suffer to exist a priority for any administrative
expense or unsecured claim against the Loan Parties (now existing or hereafter
arising of any kind or nature whatsoever), including any administrative expenses
of the kind specified in, or arising or ordered under, Sections 105, 326, 328,
330, 331, 503(b), 506(c), 507(a), 507(b), 546(c) 726 and 1114 of the Bankruptcy
Code equal or superior to the priority of the Administrative Agent and the
Lenders in respect of the Obligations, except as provided in Section 2.3.

 

(c)           Except as permitted by the Bankruptcy Court Orders, at any time,
suffer to exist any Lien on the Collateral having a priority equal or superior
to the Lien in favor of the Administrative Agent for the benefit of the Secured
Parties in respect of the Collateral.

 

(d)           Prior to the date on which the Facility Termination Date has
occurred, pay any administrative expense claims except (i) professional expenses
to the extent provided in the Budget and approved by the Bankruptcy Court,
(ii) Obligations due and payable hereunder, and (iii) other administrative
expense and professional claims incurred in the ordinary course of the business
of the Loan Parties or the Chapter 11 Case to the extent provided in the Budget.

 

ARTICLE VIII

 

EVENTS OF DEFAULT AND REMEDIES

 

8.1          Events of Default.

 

Any of the following shall constitute an Event of Default:

 

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(a)           Non-Payment.  Any Loan Party fails to pay (i) when and as required
to be paid herein, any amount of principal of any Loan, or (ii) within three
(3) Business Days after the same becomes due, any interest on any Loan, or any
fee due hereunder, or (iii) within five (5) Business Days after the same becomes
due, any other amount payable hereunder or under any other Loan Document; or

 

(b)           Specific Covenants.  Any Loan Party fails to perform or observe
any term, covenant or agreement contained in any of Section 6.1, 6.2, 6.3(a),
6.5(a), 6.10, 6.11, 6.13, 6.14, 6.16, 6.18 or 6.19 or Article VII; or

 

(c)           Other Defaults.  Any Loan Party fails to perform or observe
(i) any term, covenant or agreement contained in Section 6.19 and such failure
continues for five Business Days or (ii) any other covenant or agreement (not
specified in Section 8.1 (a) or (b) above or Section 8.1(c)(i) above) contained
in any Loan Document on its part to be performed or observed and such failure
continues for thirty days; or

 

(d)           Representations and Warranties.  Any representation, warranty,
certification or statement of fact made or deemed made by or on behalf of any
Loan Party herein, in any other Loan Document, or in any document delivered in
connection herewith or therewith shall be incorrect or misleading in any
material respect when made or deemed made; or

 

(e)           General Cross-Default.  Any Loan Party or any Subsidiary (A) fails
to make any payment when due (whether by scheduled maturity, required
prepayment, acceleration, demand, or otherwise) in respect of any Indebtedness
or Guarantee incurred or assumed on or after the Petition Date (other than
Indebtedness hereunder) having an aggregate principal amount (including undrawn
committed or available amounts and including amounts owing to all creditors
under any combined or syndicated credit arrangement) of more than the Threshold
Amount, or (B) fails to observe or perform any other agreement or condition
relating to any such Indebtedness or Guarantee or contained in any instrument or
agreement evidencing, securing or relating thereto, or any other event occurs,
the effect of which default or other event is to cause, or to permit the holder
or holders of such Indebtedness or the beneficiary or beneficiaries of such
Guarantee (or a trustee or agent on behalf of such holder or holders or
beneficiary or beneficiaries) to cause, with the giving of notice if required,
such Indebtedness to be demanded or to become due or to be repurchased, prepaid,
defeased or redeemed (automatically or otherwise), or an offer to repurchase,
prepay, defease or redeem such Indebtedness to be made, prior to its stated
maturity, or such Guarantee to become payable or cash collateral in respect
thereof to be demanded; or

 

(f)            Aralez Canadian DIP Credit Agreement.  Occurrence of an Event of
Default as defined in the Aralez Canadian DIP Credit Agreement.

 

(g)           Attachment.  Any writ or warrant of attachment or execution or
similar process is issued or levied against all or any material part of the
property of any Loan Party or any of its Subsidiaries that is not released,
vacated or fully bonded within thirty days after its issue or levy; or

 

(h)           Judgments.  There is entered against any Loan Party or any
Subsidiary (i) one or more final judgments or orders for the payment of money in
an aggregate amount (as to all such judgments or orders) exceeding the Threshold
Amount (to the extent not covered by independent third-party insurance as to
which the insurer has been notified of the claim and does not dispute coverage),
or (ii) any one or more non-monetary final judgments that have, or could
reasonably be expected to have, individually or in the aggregate, a Material
Adverse Effect and, in either case, (A) enforcement proceedings are commenced by
any creditor upon such judgment or order, or (B) there is a period of ten
consecutive days during which a stay of enforcement of such judgment, by reason
of a pending appeal or otherwise, is not in effect; or

 

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(i)            ERISA.  (i) An ERISA Event occurs with respect to a Pension Plan
or Multiemployer Plan which has resulted or could reasonably be expected to
result in liability of any Loan Party under Title IV of ERISA to the Pension
Plan, Multiemployer Plan or the PBGC in an aggregate amount that could
reasonably be expected to have, individually or in the aggregate, a Material
Adverse Effect, or (ii) the Borrower or any ERISA Affiliate fails to pay when
due, after the expiration of any applicable grace period, any installment
payment with respect to its withdrawal liability under Section 4201 of ERISA
under a Multiemployer Plan in an aggregate amount that could reasonably be
expected to have, individually or in the aggregate, a Material Adverse Effect;
or

 

(j)            Invalidity of Loan Documents.  Any provision of any Loan
Document, at any time after its execution and delivery and for any reason other
than as expressly permitted hereunder or thereunder or the occurrence of the
Facility Termination Date, ceases to be in full force and effect or ceases to
give the Administrative Agent any material part of the Liens purported to be
created hereby or thereby or by any Bankruptcy Court Order; or any Loan Party or
any other Person contests in any manner the validity or enforceability of any
provision of any Loan Document; or any Loan Party denies that it has any or
further liability or obligation under any provision of any Loan Document, or
purports to revoke, terminate or rescind any Loan Document; or

 

(k)           Change of Control.  There occurs any Change of Control; or

 

(l)            Case Milestones.  The failure to meet any of the Case Milestones,
or:

 

(m)          Chapter 11 Case.

 

(i)            the Interim Bankruptcy Court Order or the Final Bankruptcy Court
Order shall have been stayed, amended, modified, reversed, or vacated; or

 

(ii)           an order with respect to the Chapter 11 Case shall be entered by
the Bankruptcy Court appointing, or any Loan Party shall file an application for
an order with respect to any Chapter 11 Case seeking the appointment of, (i) a
trustee under Section 1104 of the Bankruptcy Code, or (ii) an examiner with
enlarged powers relating to the operation of the business (powers beyond those
set forth in Section 1106(a)(3) and (4) of the Bankruptcy Code) under
Section 1106(b) of the Bankruptcy Code; or

 

(iii)          an order with respect to the Chapter 11 Case shall be entered by
the Bankruptcy Court converting such Chapter 11 Case to a case under Chapter 7
of the Bankruptcy Code; or

 

(iv)          an order shall be entered by the Bankruptcy Court confirming a
plan of reorganization in the Chapter 11 Case which does not (i) contain a
provision for termination of the Commitments and payment and performance in full
of all Obligations of the Loan Parties hereunder and under the other Loan
Documents and cause the Facility Termination Date to occur on or before the
effective date of such plan or plans upon entry thereof and (ii) provide for the
continuation and perfection of the Liens and security interests granted to the
Administrative Agent for the benefit of the Administrative Agent and the Lenders
and priorities provided herein and in the other Loan Documents and the
Bankruptcy Court Orders until such plan effective date; or

 

(v)           an order shall be entered by the Bankruptcy Court dismissing the
Chapter 11 Case which does not contain a provision for termination of the
Commitments, and the payment in and performance in full of all Obligations of
the Loan Parties hereunder and under the other Loan Documents and the occurrence
of the Facility Termination Date upon entry thereof; or

 

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(vi)          an order with respect to the Chapter 11 Case shall be entered by
the Bankruptcy Court without the express prior written consent of the
Administrative Agent and the Required Lenders, (1) to revoke, reverse, stay,
modify, supplement or amend any of the Bankruptcy Court Orders, (2) except with
respect to the Carve-Out, to permit any administrative expense or any claim (now
existing or hereafter arising, of any kind or nature whatsoever) to have
administrative priority as to the Loan Parties equal or superior to the priority
of the Administrative Agent and the other Secured Parties in respect of the
Obligations, (3) to grant or permit the grant of a Lien on the Collateral other
than a Permitted Lien or (4) to reject the Astra Zeneca Documents; or

 

(vii)         an application for any of the orders described in clauses
(i) through (vi) above shall be made by a Person and such application is not
contested by the Loan Parties in good faith and the relief requested is granted
in an order that is not stayed pending appeal; or

 

(viii)        any action shall be commenced against the Administrative Agent or
any other Secured Party or any Related Party of any of them by any Loan Party or
any of its Affiliates, officers or employees; or

 

(ix)          any termination or modification of the exclusivity periods set
forth in section 1121 of the Bankruptcy Code unless consented to by the
Administrative Agent; or

 

(x)           an order shall be entered by the Bankruptcy Court that is not
stayed pending appeal granting relief from the automatic stay to any creditor of
any Loan Party with respect to any claim in an amount equal to or exceeding
$50,000 in the aggregate (for all such claims of all such creditors); or

 

(xi)          (A) any Person shall attempt to invalidate, reduce or otherwise
impair the Liens or security interests of the Prepetition Secured Parties, the
Administrative Agent or the Lenders in the Collateral and/or the Prepetition
Lenders’, Administrative Agent’s or the Lenders’ claims or rights against such
Person or to subject any Collateral to assessment pursuant to Section 506(c) of
the Bankruptcy Code, (B) any Lien or security interest created by the
Prepetition Debt Documents, this Agreement, the other Loan Documents or the
Bankruptcy Court Orders shall, for any reason, cease to be valid and have the
priorities and perfection set forth herein and therein or (C) any action shall
be commenced by any Person which contests the validity, perfection, priority or
enforceability of any of the Liens and security interests of the Prepetition
Secured Parties, the Administrative Agent and/or the other Secured Parties
created by any of the Bankruptcy Court Orders, Prepetition Debt Document, this
Agreement or any other Loan Document, subject to paragraph 22 of the Interim
Bankruptcy Court Order; or

 

(xii)         the Bankruptcy Court Orders or any security agreement, any pledge
agreement, any mortgage or any other security document, related to this
Agreement, any other Loan Document or the Bankruptcy Court Orders after delivery
thereof pursuant hereto, shall for any reason fail or cease to create a valid
and perfected and first priority Lien in favor of the Administrative Agent for
the benefit of the Secured Parties on any Collateral purported to be covered
hereby or thereby; or

 

(xiii)        Borrower shall make any prepetition payment other than (A) as
permitted by the Interim Bankruptcy Court Order or, the Final Bankruptcy Court
Order, (B) as otherwise permitted by this Agreement, (C) as otherwise ordered by
the Bankruptcy Court and agreed in writing by the Administrative Agent in its
sole discretion or (D) as authorized by the Bankruptcy Court (i) in accordance
with the First Day Orders entered on, before or after the Petition Date or other
orders of the Bankruptcy Court entered with the consent of (or non-objection by)
the Administrative

 

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Agent, (ii) in connection with the assumption of executory contracts and
unexpired leases with the consent of (or non-objection by) the Administrative
Agent or (iii) in respect of accrued payroll and related expenses and employee
benefits as of the Petition Date; or

 

(xiv)        Borrowers shall fail to comply with any of the material terms of
the Interim Bankruptcy Court Order or the Final Bankruptcy Court Order; or

 

(xv)         any stipulation shall be entered into by Borrowers or any order
shall be entered by the Bankruptcy Court with respect to the provision of
adequate protection to any Person or the use of cash collateral by Borrowers, in
each case that is not satisfactory in form and substance to the Administrative
Agent in its sole and absolute discretion; or

 

(xvi)        entry of a Bankruptcy Court order authorizing the sale of all or
substantially all of the assets of Borrowers pursuant to Section 363 of the
Bankruptcy Code (or Borrowers seeking or supporting such sale) that does not
provide for the payment in full of all Obligations (other than contingent
indemnification obligations for which no claim has been made) in accordance with
the terms of this Agreement and the other Loan Documents (less the aggregate
amount “credit bid” by the Administrative Agent and/or the Lenders for any or
all such assets); or

 

(xvii)       failure of the Bankruptcy Court to permit the Lenders to credit bid
the Prepetition Credit Facility Debt, subject to (i) entry of the Final
Bankruptcy Court Order and (ii) paragraph 23 of the Interim Bankruptcy Court
Order, and the Loans made hereunder in connection with the purchase of
Borrower’s assets.

 

8.2          Remedies Upon Event of Default.

 

Notwithstanding anything in Section 362 of the Bankruptcy Code, but subject to
the Bankruptcy Court Orders, upon the occurrence and during the continuance of
any Event of Default, the Administrative Agent may (or shall, at the request of
the Required Lenders) take any or all of the following actions, at the same time
or different times, in each case without further order of or application to the
Bankruptcy Court:

 

(a)           declare any commitment of each Lender to make any Loans to be
terminated, whereupon such commitments and obligation shall be terminated;

 

(b)           declare the unpaid principal amount of all outstanding Loans, all
interest accrued and unpaid thereon, and all other amounts and Obligations owing
or payable hereunder or under any other Loan Document to be immediately due and
payable, without presentment, demand, protest or other notice of any kind, all
of which are hereby expressly waived by the Borrower;

 

(c)           [reserved]; and

 

(d)           exercise on behalf of itself and the Lenders all rights and
remedies available to it and the Lenders under the Loan Documents or applicable
Law or at equity.

 

Neither the Loan Parties nor any other party in interest shall have the right to
contest the enforcement of remedies set forth in the Bankruptcy Court Orders and
the Loan Documents on any basis other than an assertion that an Event of Default
has not occurred or has been cured within the cure periods expressly set forth
in the applicable Loan Documents. Subject to the first sentence of this
paragraph, the Loan Parties shall cooperate fully with the Administrative Agent
and the other Secured Parties in their exercise of rights and remedies, whether
against the Collateral or otherwise.  The Loan Parties hereby

 

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waive any right to seek relief under the Bankruptcy Code, including under
Section 105 thereof, to the extent such relief would restrict or impair the
rights and remedies of the Administrative Agent and the other Secured Parties
set forth in the Bankruptcy Court Orders and in the Loan Documents.

 

In case any one or more of the covenants and/or agreements set forth in this
Agreement or any other Loan Document shall have been breached by any Loan Party,
then the Administrative Agent or any other Secured Party may proceed to protect
and enforce the Secured Parties’ rights either by suit in equity and/or by
action at law, including an action for damages as a result of any such breach
and/or an action for specific performance of any such covenant or agreement
contained in this Agreement or such other Loan Document.  Without limitation of
the foregoing, the Loan Parties agree that failure to comply with any of the
covenants contained herein will cause irreparable harm and that specific
performance shall be available in the event of any breach thereof (without the
necessity of posting bond or other security and without the need to prove
damages).  The Administrative Agent and any other Secured Party acting pursuant
to this paragraph shall be indemnified by the Loan Parties against all
liability, loss or damage, together with all reasonable costs and expenses
related thereto (including reasonable legal and accounting fees and expenses) in
accordance with the terms hereof.

 

Notwithstanding anything to the contrary in this Agreement or any other Loan
Document, each Loan Party hereby irrevocably and unconditionally constitutes and
appoints the Administrative Agent and any of the Administrative Agent’s
Affiliates, attorneys, representatives or agents, with full power of
substitution, as such Loan Party’s true and lawful attorney-in-fact with full
irrevocable and unconditional power and authority in the place and stead of such
Loan Party and in the name of such Loan Party or in its own name, for the
purpose of carrying out the terms of this Agreement and the other Loan
Documents, to take any appropriate steps or actions and to execute and deliver
(and perform under on such Loan Party’s behalf) any agreement, document or
instrument that may be necessary or desirable to accomplish the purposes and/or
effectuate the items and actions set forth in this Agreement and the other Loan
Documents, including (i) any actions that any such Loan Party fails to take that
are required under such documents, agreements or instruments and (ii) during the
existence of any Event of Default.

 

8.3          Application of Funds.

 

After the exercise of remedies provided for in Section 8.2 (or after the
Obligations have automatically become immediately due and payable as set forth
in the proviso to Section 8.2), any amounts received on account of the
Obligations shall be, subject to the Carve-Out, applied by the Administrative
Agent in the following order:

 

First, to payment of that portion of the Obligations constituting fees,
indemnities, expenses and other amounts (including fees, charges and
disbursements of counsel to the Administrative Agent and amounts payable under
Article III) payable to the Administrative Agent in its capacity as such;

 

Second, to payment of that portion of the Obligations constituting fees,
indemnities and other amounts (other than principal and interest) payable to the
Lenders (including fees, charges and disbursements of counsel to the respective
Lenders and amounts payable under Article III), ratably among them in proportion
to the respective amounts described in this clause Second payable to them;

 

Third, to payment of that portion of the Obligations constituting interest on
the Loans, ratably among the Lenders in proportion to the respective amounts
described in this clause Third payable to them;

 

Fourth, to payment of that portion of the Obligations constituting unpaid
principal of the Loans, ratably among the Lenders in proportion to the
respective amounts described in this clause Fourth payable to them;

 

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Fifth, to payment of any other Obligations, ratably among the Lenders in
proportion to the respective amounts described in this clause Fifth payable to
them; and

 

Last, the balance, if any, after all of the Obligations have been indefeasibly
paid in full and all Commitments have been terminated, to the Borrower or as
otherwise required by Law.

 

ARTICLE IX

 

ADMINISTRATIVE AGENT

 

9.1          Appointment and Authority.

 

Each of the Lenders hereby irrevocably appoints Deerfield to act on its behalf
as the Administrative Agent hereunder and under the other Loan Documents and
authorizes the Administrative Agent to take such actions on its behalf and to
exercise such powers as are delegated to the Administrative Agent by the terms
hereof or thereof, together with such actions and powers as are reasonably
incidental thereto.  The provisions of this Article are solely for the benefit
of the Administrative Agent and the Lenders, and no Loan Party shall have rights
as a third party beneficiary of any of such provisions.  It is understood and
agreed that the use of the term “agent” herein or in any other Loan Documents
(or any other similar term) with reference to the Administrative Agent is not
intended to connote any fiduciary or other implied (or express) obligations
arising under agency doctrine of any applicable Law.  Instead such term is used
as a matter of market custom, and is intended to create or reflect only an
administrative relationship between contracting parties.

 

The Administrative Agent shall also act as the “collateral agent” under the Loan
Documents, and each of the Lenders (in its capacities as a Lender) hereby
irrevocably appoints and authorizes the Administrative Agent to act as the agent
of such Lender for purposes of acquiring, holding and enforcing any and all
Liens on Collateral, together with such powers and discretion as are reasonably
incidental thereto. In this connection, the Administrative Agent, as “collateral
agent” and any co-agents, sub-agents and attorneys-in-fact appointed by the
Administrative Agent pursuant to Section 9.5 for purposes of holding or
enforcing any Lien on the Collateral (or any portion thereof) granted under the
Loan Documents and the Bankruptcy Court Orders, or for exercising any rights and
remedies thereunder at the direction of the Administrative Agent, shall be
entitled to the benefits of all provisions of this Article IX and Article XI
(including Section 11.4(c), as though such co-agents, sub-agents and
attorneys-in-fact were the “collateral agent” under the Loan Documents) as if
set forth in full herein with respect thereto.

 

9.2          Rights as a Lender.

 

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

 

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9.3          Exculpatory Provisions.

 

The Administrative Agent shall not have any duties or obligations except those
expressly set forth herein and in the other Loan Documents, and its duties
hereunder shall be administrative in nature.  Without limiting the generality of
the foregoing, the Administrative Agent:

 

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

 

(b)           shall not have any duty to take any discretionary action or
exercise any discretionary powers, except discretionary rights and powers
expressly contemplated hereby or by the other Loan Documents that the
Administrative Agent is required to exercise as directed in writing by the
Required Lenders (or such other number or percentage of the Lenders as shall be
expressly provided for herein or in the other Loan Documents), provided that the
Administrative Agent shall not be required to take any action that, in its
opinion or the opinion of its counsel, may expose the Administrative Agent to
liability or that is contrary to any Loan Document or applicable Law, including
for the avoidance of doubt any action that may be in violation of the automatic
stay under any Debtor Relief Law; and

 

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

 

Neither the Administrative Agent nor any of its Related Parties shall be liable
for any action taken or not taken by the Administrative Agent under or in
connection with this Agreement or any other Loan Document or the transactions
contemplated hereby or thereby.  The Administrative Agent shall be deemed not to
have knowledge of any Default.  The Administrative Agent shall have no
responsibility or duty to provide any agreements, instruments or documents that
it receives from any Loan Party or any of its Affiliates to any Lender.

 

Neither the Administrative Agent nor any of its Related Parties have any duty or
obligation to any Lender or participant or any other Person to ascertain or
inquire into (i) any statement, warranty or representation made in or in
connection with this Agreement or any other Loan Document, (ii) the contents of
any certificate, report or other document delivered hereunder or thereunder or
in connection herewith or therewith, (iii) the performance or observance of any
of the covenants, agreements or other terms or conditions set forth herein or
there in or the occurrence of any Default, (iv) the validity, enforceability,
effectiveness or genuineness of this Agreement, any other Loan Document or any
other agreement, instrument or document, or the creation, perfection or priority
of any Lien purported to be created by the Loan Documents or the Bankruptcy
Court Orders, (v) the value or the sufficiency of any Collateral, or (vi) the
satisfaction of any condition set forth in Article IV or elsewhere herein, other
than to confirm receipt of items expressly required to be delivered to the
Administrative Agent.

 

The Administrative Agent shall not be responsible for the negligence or
misconduct of any agent, advisor or attorney in fact that it selects.

 

9.4          Reliance by Administrative Agent.

 

The Administrative Agent shall be entitled to rely upon, and shall be fully
protected in relying and shall not incur any liability for relying upon, any
notice, request, certificate, communication, consent, statement, instrument,
document or other writing (including any electronic message, Internet or
intranet website posting or other distribution) believed by it to be genuine and
to have been signed, sent or otherwise authenticated by the proper Person.  The
Administrative Agent also may rely upon any statement made to it orally or by
telephone and believed by it to have been made by the proper Person,

 

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and shall be fully protected in relying and shall not incur any liability for
relying thereon.  In determining compliance with any condition hereunder to the
making of a Loan that by its terms must be fulfilled to the satisfaction of a
Lender, the Administrative Agent may presume that such condition is satisfactory
to such Lender unless the Administrative Agent shall have received notice to the
contrary from such Lender prior to the making of such Loan. The Administrative
Agent may consult with legal counsel (who may be counsel for the Loan Parties),
independent accountants and other experts selected by it, and shall not be
liable for any action taken or not taken by it in accordance with the advice of
any such counsel, accountants or experts.

 

9.5          Delegation of Duties.

 

The Administrative Agent may perform any and all of its duties and exercise its
rights and powers hereunder or under any other Loan Document by or through any
one or more sub agents appointed by the Administrative Agent.  The
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 Related
Parties.  The exculpatory provisions of this Article shall apply to any such sub
agent and to the Related Parties of the Administrative Agent and any such sub
agent, and shall apply to their respective activities as Administrative Agent. 
The Administrative Agent shall not be responsible for the negligence or
misconduct of any sub- agents except to the extent that a court of competent
jurisdiction determines in a final and non-appealable judgment that the
Administrative Agent acted with gross negligence or willful misconduct in the
selection of such sub-agents.

 

9.6          Resignation of Administrative Agent.

 

(a)           The Administrative Agent may at any time give notice of its
resignation to the Lenders and the Borrower.  Upon receipt of any such notice of
resignation, the Required Lenders shall have the right, in consultation with the
Borrowers, to appoint a successor, which shall be a bank with an office in the
United States, or an Affiliate of any such bank with an office in the United
States.  If no such successor shall have been so appointed by the Required
Lenders and shall have accepted such appointment within thirty days after the
retiring Administrative Agent gives notice of its resignation (or such earlier
day as shall be agreed by the Required Lenders) (the “Resignation Effective
Date”), then the retiring Administrative Agent may (but shall not be obligated
to) on behalf of the Lenders, appoint a successor Administrative Agent meeting
the qualifications set forth above. Whether or not a successor has been
appointed, such resignation shall become effective in accordance with such
notice on the Resignation Effective Date.

 

(b)           [Reserved].

 

(c)           With effect from the Resignation Effective Date (i) the retiring
or removed Administrative Agent shall be discharged from its duties and
obligations hereunder and under the other Loan Documents (except that in the
case of any collateral security held by the Administrative Agent on behalf of
the Lenders under any of the Loan Documents, the retiring or removed
Administrative Agent shall continue to hold such collateral security until such
time as a successor Administrative Agent is appointed) and (ii) except for any
indemnity payments or other amounts then owed to the retiring or removed
Administrative Agent, all payments, communications and determinations provided
to be made by, to or through the Administrative Agent shall instead be made by
or to each Lender directly, until such time, if any, as the Required Lenders
appoint a successor Administrative Agent as provided for above. Upon the
acceptance of a successor’s appointment as Administrative Agent hereunder, such
successor shall succeed to and become vested with all of the rights, powers,
privileges and duties of the retiring (or removed) Administrative Agent (other
than as provided in Section 3.1(g) and other than any rights to indemnity
payments or other amounts owed to the retiring or removed Administrative Agent
as of the

 

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Resignation Effective Date), and the retiring or removed Administrative Agent
shall be discharged from all of its duties and obligations hereunder or under
the other Loan Documents (if not already discharged therefrom as provided above
in this Section). The fees payable by the Borrowers to a successor
Administrative Agent shall be the same as those payable to its predecessor
unless otherwise agreed between the Borrowers and such successor.  After the
retiring or removed Administrative Agent’s resignation or removal hereunder and
under the other Loan Documents, the provisions of this Article and Section 11.4
shall continue in effect for the benefit of such retiring or removed
Administrative Agent, its sub agents and their respective Related Parties in
respect of any actions taken or omitted to be taken by any of them while the
retiring or removed Administrative Agent was acting as Administrative Agent.

 

9.7          Non-Reliance on Administrative Agent and Other Lenders.

 

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

 

9.8          [Reserved].

 

9.9          Administrative Agent May File Proofs of Claim; Credit Bidding.

 

In case of the pendency of any proceeding under any Debtor Relief Law or any
other judicial proceeding relative to any Loan Party, the Administrative Agent
(irrespective of whether the principal of any Loan shall then be due and payable
as herein expressed or by declaration or otherwise and irrespective of whether
the Administrative Agent shall have made any demand on the Borrowers) shall be
entitled and empowered, by intervention in such proceeding or otherwise:

 

(a)           to file and prove a claim for the whole amount of the principal
and interest owing and unpaid in respect of the Loans and all other Obligations
that are owing and unpaid and to file such other documents as may be necessary
or advisable in order to have the claims of the Lenders and the Administrative
Agent (including any claim for the reasonable compensation, expenses,
disbursements and advances of the Lenders and the Administrative Agent and their
respective agents and counsel and all other amounts due the Lenders and the
Administrative Agent under Sections 2.9 and 11.4) allowed in such judicial
proceeding; and

 

(b)           to collect and receive any monies or other property payable or
deliverable on any such claims and to distribute the same; and any custodian,
receiver, assignee, trustee, liquidator, sequestrator or other similar official
in any such judicial proceeding is hereby authorized by each Lender to make such
payments to the Administrative Agent and, in the event that the Administrative
Agent shall consent to the making of such payments directly to the Lenders, to
pay to the Administrative Agent any amount due for the reasonable compensation,
expenses, disbursements and advances of the Administrative Agent and its agents
and counsel, and any other amounts due the Administrative Agent under Sections
2.9 and 11.4.

 

Nothing contained herein shall be deemed to authorize the Administrative Agent
to authorize or consent to or accept or adopt on behalf of any Lender any plan
of reorganization, arrangement, adjustment or composition affecting the
Obligations or the rights of any Lender to authorize the Administrative Agent to
vote in respect of the claim of any Lender in any such proceeding.

 

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The Secured Parties hereby irrevocably authorize the Administrative Agent, at
the direction of the Required Lenders, to credit bid all or any portion of the
Obligations (including accepting some or all of the Collateral in satisfaction
of some or all of the Obligations pursuant to a deed in lieu of foreclosure or
otherwise) and in such manner purchase (either directly or through one or more
acquisition vehicles) all or any portion of the Collateral (a) at any sale
thereof conducted under the provisions of the Bankruptcy Code of the United
States, including under Sections 363, 1123 or 1129 of the Bankruptcy Code of the
United States, or any similar Laws in any other jurisdictions to which a Loan
Party is subject,

 

(c)           at any other sale or foreclosure or acceptance of collateral in
lieu of debt conducted by (or with the consent or at the direction of) the
Administrative Agent (whether by judicial action or otherwise) in accordance
with any applicable Law.  In connection with any such credit bid and purchase,
the Obligations owed to the Secured Parties shall be entitled to be, and shall
be, credit bid on a ratable basis (with Obligations with respect to contingent
or unliquidated claims receiving contingent interests in the acquired assets on
a ratable basis that would vest upon the liquidation of such claims in an amount
proportional to the liquidated portion of the contingent claim amount used in
allocating the contingent interests) in the asset or assets so purchased (or in
the Equity Interests or debt instruments of the acquisition vehicle or vehicles
that are used to consummate such purchase). In connection with any such bid
(i) the Administrative Agent shall be authorized to form one or more acquisition
vehicles to make a bid, (ii) to adopt documents providing for the governance of
the acquisition vehicle or vehicles (provided that any actions by the
Administrative Agent with respect to such acquisition vehicle or vehicles,
including any disposition of the assets or Equity Interests thereof shall be
governed, directly or indirectly, by the vote of the Required Lenders,
irrespective of the termination of this Agreement and without giving effect to
the limitations on actions by the Required Lenders contained in clauses
(a)(i) through (a)(vi) of Section 11.1) and (iii) to the extent that Obligations
that are assigned to an acquisition vehicle are not used to acquire Collateral
for any reason (as a result of another bid being higher or better, because the
amount of Obligations assigned to the acquisition vehicle exceeds the amount of
debt credit bid by the acquisition vehicle or otherwise), such Obligations shall
automatically be reassigned to the Lenders pro rata and the Equity Interests
and/or debt instruments issued by any acquisition vehicle on account of the
Obligations that had been assigned to the acquisition vehicle shall
automatically be cancelled, without the need for any Lender or any acquisition
vehicle to take any further action.

 

9.10        Collateral and Guaranty Matters.

 

Without limiting the provisions of Section 9.9, each of the Lenders irrevocably
authorizes the Administrative Agent, at its option and in its discretion,

 

(a)           to release any Lien on any property granted to or held by the
Administrative Agent under any Loan Document (i) upon the Facility Termination
Date, (ii) that is sold or otherwise disposed of as part of or in connection
with any sale or other disposition permitted hereunder or under any other Loan
Document or any Recovery Event, or (iii) as approved in accordance with
Section 11.1;

 

(b)           to subordinate any Lien on any property granted to or held by the
Administrative Agent under any Loan Document to the holder of any Lien on such
property that is permitted by Section 7.1(i); and

 

(c)           to release any Guarantor from its obligations under the Guaranty
if such Person ceases to be a Subsidiary as a result of a transaction permitted
under the Loan Documents.

 

Upon request by the Administrative Agent at any time, the Required Lenders will
confirm in writing the Administrative Agent’s authority to release or
subordinate its interest in particular types or

 

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items of property, or to release any Guarantor from its obligations under the
Guaranty, pursuant to this Section 9.10.

 

The Administrative Agent shall not be responsible for or have a duty to
ascertain or inquire into any representation or warranty regarding the
existence, value or collectability of the Collateral, the existence, priority or
perfection of the Administrative Agent’s Lien thereon, or any certificate
prepared by any Loan Party in connection therewith, nor shall the Administrative
Agent be responsible or liable to the Secured Parties for any failure to monitor
or maintain any portion of the Collateral.

 

ARTICLE X

 

GUARANTY

 

10.1        The Guaranty.

 

Each of the Guarantors hereby jointly and severally guarantees to each Lender
and each other holder of Obligations as hereinafter provided, as primary obligor
and not as surety, the prompt payment of the Obligations (including all interest
that accrues after the commencement of the Chapter 11 Case, whether or not a
claim for post-filing interest is allowed in the Chapter 11 Case) in full when
due (whether at stated maturity, as a mandatory prepayment, by acceleration, as
a mandatory cash collateralization or otherwise) strictly in accordance with the
terms thereof.  The Guarantors hereby further agree that if any of the
Obligations are not paid in full when due (whether at stated maturity, as a
mandatory prepayment, by acceleration, as a mandatory cash collateralization or
otherwise), the Guarantors will, jointly and severally, promptly pay the same,
without any demand or notice whatsoever, and that in the case of any extension
of time of payment or renewal of any of the Obligations, the same will be
promptly paid in full when due (whether at extended maturity, as a mandatory
prepayment, by acceleration, as a mandatory cash collateralization or otherwise)
in accordance with the terms of such extension or renewal.

 

Notwithstanding any provision to the contrary contained herein or in any other
of the Loan Documents or the other documents relating to the Obligations, the
obligations of each Guarantor under this Agreement and the other Loan Documents
shall not exceed an aggregate amount equal to the largest amount that would not
render such obligations subject to avoidance under applicable Debtor Relief
Laws.

 

10.2        Obligations Unconditional.

 

The obligations of the Guarantors under Section 10.1 are joint and several,
absolute and unconditional, irrespective of the value, genuineness, validity,
regularity or enforceability of any of the Loan Documents or other documents
relating to the Obligations, or any substitution, release, impairment or
exchange of any other guarantee of or security for any of the Obligations, and,
to the fullest extent permitted by applicable Law, irrespective of any other
circumstance whatsoever which might otherwise constitute a legal or equitable
discharge or defense of a surety or guarantor, it being the intent of this
Section 10.2 that the obligations of the Guarantors hereunder shall be absolute
and unconditional under any and all circumstances. Each Guarantor agrees that
such Guarantor shall have no right of subrogation, indemnity, reimbursement or
contribution against any Borrower or any other Loan Party for amounts paid under
this Article X until such time as the Facility Termination Date has occurred. 
Without limiting the generality of the foregoing, it is agreed that, to the
fullest extent permitted by Law, the occurrence of any one or more of the
following shall not alter or impair the liability of any Guarantor hereunder,
which shall remain absolute and unconditional as described above:

 

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(a)           at any time or from time to time, without notice to any Guarantor,
the time for any performance of or compliance with any of the Obligations shall
be extended, or such performance or compliance shall be waived;

 

(b)           any of the acts mentioned in any of the provisions of any of the
Loan Documents or other documents relating to the Obligations shall be done or
omitted;

 

(c)           the maturity of any of the Obligations shall be accelerated, or
any of the Obligations shall be modified, supplemented or amended in any
respect, or any right under any of the Loan Documents or other documents
relating to the Obligations shall be waived or any other guarantee of any of the
Obligations or any security therefor shall be released, impaired or exchanged in
whole or in part or otherwise dealt with;

 

(d)           any Lien granted to, or in favor of, the Administrative Agent or
any other Secured Party as security for any of the Obligations shall fail to
attach or be perfected; or

 

(e)           any of the Obligations shall be determined to be void or voidable
(including for the benefit of any creditor of any Guarantor) or shall be
subordinated to the claims of any Person (including any creditor of any
Guarantor).

 

With respect to its obligations hereunder, each Guarantor hereby expressly
waives diligence, presentment, demand of payment, protest and all notices
whatsoever, and any requirement that the Administrative Agent or any other
Secured Party exhaust any right, power or remedy or proceed against any Person
under any of the Loan Documents or any other document relating to the
Obligations, or against any other Person under any other guarantee of, or
security for, any of the Obligations.

 

10.3        Reinstatement.

 

The obligations of each Guarantor under this Article X shall be automatically
reinstated if and to the extent that for any reason any payment by or on behalf
of any Person in respect of the Obligations is rescinded or must be otherwise
restored by any Secured Party, whether as a result of any Debtor Relief Law or
otherwise, and each Guarantor agrees that it will indemnify the Administrative
Agent and each other Secured Party on demand for all reasonable costs and
expenses (including the fees, charges and disbursements of counsel) incurred by
the Administrative Agent or such Secured Party in connection with such
rescission or restoration, including any such costs and expenses incurred in
defending against any claim alleging that such payment constituted a preference,
fraudulent transfer or similar payment under any Debtor Relief Law.

 

10.4        Certain Additional Waivers.

 

Each Guarantor agrees that such Guarantor shall have no right of recourse to
security for the Obligations, except through the exercise of rights of
subrogation pursuant to Section 10.2 and through the exercise of rights of
contribution pursuant to Section 10.6.

 

10.5        Remedies.

 

The Guarantors agree that, to the fullest extent permitted by Law, as between
the Guarantors, on the one hand, and the Administrative Agent and the other
holders of the Obligations, on the other hand, the Obligations may be declared
to be forthwith due and payable as specified in Section 10.2 (and shall be
deemed to have become automatically due and payable in the circumstances
specified in Section 10.2) for purposes of Section 10.1 notwithstanding any
stay, injunction or other prohibition preventing such

 

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declaration (or preventing the Obligations from becoming automatically due and
payable) as against any other Person and that, in the event of such declaration
(or the Obligations being deemed to have become automatically due and payable),
the Obligations (whether or not due and payable by any other Person) shall
forthwith become due and payable by the Guarantors for purposes of Section 10.1.
The Guarantors acknowledge and agree that their obligations hereunder are
secured in accordance with the terms of the Loan Documents and the Bankruptcy
Court Orders and that the Secured Parties may exercise their remedies hereunder
and thereunder in accordance with the terms hereof and thereof.

 

10.6        Rights of Contribution.

 

The Guarantors hereby agree as among themselves that, if any Guarantor shall
make an Excess Payment (as defined below), such Guarantor shall have a right of
contribution from each other Guarantor in an amount equal to such other
Guarantor’s Contribution Share (as defined below) of such Excess Payment.  The
payment obligations of any Guarantor under this Section 10.6 shall be
subordinate and subject in right of payment to the Obligations until such time
as the Obligations have been paid-in-full and the Commitments have terminated,
and none of the Guarantors shall exercise any right or remedy under this
Section 10.6 against any other Guarantor until such Obligations have been
paid-in-full and the Commitments have terminated.  For purposes of this
Section 10.6, (a) “Excess Payment” shall mean the amount paid by any Guarantor
in excess of its Ratable Share of any Obligations; (b) “Ratable Share” shall
mean, for any Guarantor in respect of any payment of Obligations, the ratio
(expressed as a percentage) as of the date of such payment of Obligations of
(i) the amount by which the aggregate present fair salable value of all of its
assets and properties exceeds the amount of all debts and liabilities of such
Guarantor (including contingent, subordinated, unmatured, and unliquidated
liabilities, but excluding the obligations of such Guarantor hereunder) to
(ii) the amount by which the aggregate present fair salable value of all assets
and other properties of all of the Loan Parties exceeds the amount of all of the
debts and liabilities (including contingent, subordinated, unmatured, and
unliquidated liabilities, but excluding the obligations of the Loan Parties
hereunder) of the Loan Parties; provided, however, that, for purposes of
calculating the Ratable Shares of the Guarantors in respect of any payment of
Obligations, any Guarantor that became a Guarantor subsequent to the date of any
such payment shall be deemed to have been a Guarantor on the date of such
payment and the financial information for such Guarantor as of the date such
Guarantor became a Guarantor shall be utilized for such Guarantor in connection
with such payment; and (c) “Contribution Share” shall mean, for any Guarantor in
respect of any Excess Payment made by any other Guarantor, the ratio (expressed
as a percentage) as of the date of such Excess Payment of (i) the amount by
which the aggregate present fair salable value of all of its assets and
properties exceeds the amount of all debts and liabilities of such Guarantor
(including contingent, subordinated, unmatured, and unliquidated liabilities,
but excluding the obligations of such Guarantor hereunder) to (ii) the amount by
which the aggregate present fair salable value of all assets and other
properties of the Loan Parties other than the maker of such Excess Payment
exceeds the amount of all of the debts and liabilities (including contingent,
subordinated, unmatured, and unliquidated liabilities, but excluding the
obligations of the Loan Parties) of the Loan Parties other than the maker of
such Excess Payment; provided, however, that, for purposes of calculating the
Contribution Shares of the Guarantors in respect of any Excess Payment, any
Guarantor that became a Guarantor subsequent to the date of any such Excess
Payment shall be deemed to have been a Guarantor on the date of such Excess
Payment and the financial information for such Guarantor as of the date such
Guarantor became a Guarantor shall be utilized for such Guarantor in connection
with such Excess Payment. This Section 10.6 shall not be deemed to affect any
right of subrogation, indemnity, reimbursement or contribution that any
Guarantor may have under Law against the Borrower in respect of any payment of
Obligations.

 

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10.7        Guarantee of Payment; Continuing Guarantee.

 

The guarantee in this Article X is a guaranty of payment and not of collection,
is a continuing guarantee, and shall apply to the Obligations whenever arising.

 

10.8        Limitation of Liability.

 

Each Guarantor, and by its acceptance of the Guaranty in this Article X, the
Administrative Agent and each Lender, hereby confirms that it is the intention
of all such Persons that such Guaranty and the Obligations of each Guarantor
under the Loan Documents not constitute a fraudulent transfer or conveyance for
purposes of the Bankruptcy Code, the Uniform Fraudulent Conveyance Act, the
Uniform Fraudulent Transfer Act or any other federal, state or foreign
bankruptcy, insolvency, receivership or similar law to the extent applicable to
such Guaranty and the Obligations of each Guarantor under the Loan Documents. To
effectuate the foregoing intention, the Administrative Agent, the Lenders and
the Guarantors hereby irrevocably agree that the Obligations of each Guarantor
under such Guaranty and the Loan Documents at any time shall be limited to the
maximum amount as will result in the Obligations of such Guarantor under such
Guaranty and the Loan Documents not constituting a fraudulent transfer or
conveyance, after taking into account each Guarantor’s rights of subrogation,
indemnification or contribution which such Guarantor may have under such
Guaranty, under the Loan Documents, any other agreement or applicable law.

 

ARTICLE XI

 

MISCELLANEOUS

 

11.1        Amendments, Etc.

 

No amendment or waiver of any provision of this Agreement or any other Loan
Document, and no consent to any departure by any Loan Party therefrom, shall be
effective unless in writing signed by the Required Lenders and the Borrowers or
the applicable Loan Party, as the case may be, and acknowledged by the
Administrative Agent, and each such waiver or consent shall be effective only in
the specific instance and for the specific purpose for which given; provided,
however, that

 

(a)           no such amendment, waiver or consent shall:

 

(i)            extend or increase the Commitment of any Lender (or reinstate any
Commitment terminated pursuant to Section 8.2) without the written consent of
such Lender (it being understood and agreed that a mandatory reduction in
Commitments is not considered an extension or increase in Commitments of any
Lender);

 

(ii)           postpone any date fixed by this Agreement or any other Loan
Document for any payment (excluding mandatory prepayments) of principal,
interest, fees or other amounts due to the Lenders (or any of them) or any
scheduled reduction of the Commitments hereunder or under any other Loan
Document without the written consent of each Lender entitled to receive such
payment or whose Commitments are to be reduced;

 

(iii)          reduce the principal of, or the rate of interest specified herein
on, any Loan, or (subject to clause (i) of the final proviso to this
Section 11.1) any fees or other amounts payable hereunder or under any other
Loan Document without the written consent of each Lender entitled to receive
such amount; provided, however, that only the consent of the Required Lenders
shall be necessary (A) to amend the definition of “Default Rate” or to waive any
obligation of the Borrower to pay interest at the Default Rate or (B) to amend
any financial covenant hereunder (or

 

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any defined term used therein) even if the effect of such amendment would be to
reduce the rate of interest on any Loan or to reduce any fee payable hereunder;

 

(iv)          change Sections 8.3 or 2.13 in a manner that would alter the pro
rata sharing of payments required thereby without the written consent of each
Lender directly affected thereby;

 

(v)           change any provision of this Section 11.1(a) or the definition of
“Required Lenders” without the written consent of each Lender directly affected
thereby;

 

(vi)          release all or substantially all of the Collateral without the
written consent of each Lender whose Obligations are secured by such Collateral;

 

(vii)         release any Borrower without the consent of each Lender, or all or
substantially all of the value of the Guaranty without the written consent of
each Lender whose Obligations are guaranteed thereby, except to the extent such
release is permitted pursuant to Section 9.10 (in which case such release may be
made by the Administrative Agent acting alone); or

 

(b)           [reserved];

 

(c)           [reserved]; and

 

(d)           unless also signed by the Administrative Agent, no amendment,
waiver or consent shall affect the rights or duties of the Administrative Agent
under this Agreement or any other Loan Document;

 

provided, further, that notwithstanding anything to the contrary herein,
(i) each Lender is entitled to vote as such Lender sees fit on any bankruptcy
reorganization plan that affects the Loans, and each Lender acknowledges that
the provisions of Section 1126(c) of the Bankruptcy Code of the United States
supersedes the unanimous consent provisions set forth herein and (ii) the
Required Lenders shall determine whether or not to allow a Loan Party to use
cash collateral in the context of a bankruptcy or insolvency proceeding and such
determination shall be binding on all of the Lenders.

 

Notwithstanding any provision herein to the contrary, this Agreement may be
amended with the written consent of the Required Lenders, the Administrative
Agent and the Loan Parties (i) to add one or more additional term loan
facilities to this Agreement and to permit the extensions of credit and all
related obligations and liabilities arising in connection therewith from time to
time outstanding to share ratably (or on a basis subordinated to the existing
facilities hereunder) in the benefits of this Agreement and the other Loan
Documents with the obligations and liabilities from time to time outstanding in
respect of the existing facilities hereunder, and (ii) in connection with the
foregoing, to permit, as deemed appropriate by the Administrative Agent and
approved by the Required Lenders, the Lenders providing such additional credit
facilities to participate in any required vote or action required to be approved
by the Required Lenders or by any other number, percentage or class of Lenders
hereunder.

 

Notwithstanding any provision herein to the contrary the Administrative Agent
and the Borrowers may amend, modify or supplement this Agreement or any other
Loan Document to cure or correct administrative errors or omissions, any
ambiguity, omission, defect or inconsistency or to effect administrative
changes, and such amendment shall become effective without any further consent
of any other party to such Loan Document so long as (i) such amendment,
modification or supplement does not adversely affect the rights of any Lender or
other holder of Obligations in any material respect and (ii) the Lenders shall
have received at least five Business Days’ prior written notice thereof and the
Administrative Agent shall not have received, within five Business Days of the
date of such notice to the

 

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Lenders, a written notice from the Required Lenders stating that the Required
Lenders object to such amendment.

 

11.2        Notices; Effectiveness; Electronic Communications.

 

(a)           Notices Generally.  Except in the case of notices and other
communications expressly permitted to be given by telephone (and except as
provided in subsection (b) below), all notices and other communications provided
for herein shall be in writing and shall be delivered by hand or overnight
courier service, mailed by certified or registered mail or sent by facsimile as
follows, and all notices and other communications expressly permitted hereunder
to be given by telephone shall be made to the applicable telephone number, as
follows:

 

(i)            if to any Loan Party or the Administrative Agent, to the address,
facsimile number, electronic mail address or telephone number specified for such
Person on Schedule 11.2; and

 

(ii)           if to any Lender, to the address, facsimile number, electronic
mail address or telephone number specified in its Administrative Questionnaire
(including, as appropriate, notices delivered solely to the Person designated by
a Lender on its Administrative Questionnaire then in effect for the delivery of
notices that may contain material non-public information relating to the
Borrowers).

 

Notices and other communications sent by hand or overnight courier service, or
mailed by certified or registered mail, shall be deemed to have been given when
received; notices and other communications sent by facsimile shall be deemed to
have been given when sent (except that, if not given during normal business
hours for the recipient, shall be deemed to have been given at the opening of
business on the next Business Day for the recipient).  Notices and other
communications delivered through electronic communications to the extent
provided in subsection (b) below, shall be effective as provided in such
subsection (b).

 

(b)           Electronic Communications.  Notices and other communications to
the Lenders hereunder may be delivered or furnished by electronic communication
(including email and Internet or intranet websites) pursuant to procedures
approved by the Administrative Agent; provided that the foregoing shall not
apply to notices to any Lender pursuant to Article II if such Lender has
notified the Administrative Agent that it is incapable of receiving notices
under such Article by electronic communication. The Administrative Agent or the
Borrowers may each, in its discretion, agree to accept notices and other
communications to it hereunder by electronic communications pursuant to
procedures approved by it, provided that approval of such procedures may be
limited to particular notices or communications.

 

Unless the 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) and (ii) notices or communications posted to an
Internet or intranet website shall be deemed received upon the deemed receipt by
the intended recipient at its e-mail address as described in the foregoing
clause (i) of notification that such notice or communication is available and
identifying the website address therefor; provided that, for both clauses
(i) and (ii), if such notice, email or other communication is not sent during
the normal business hours of the recipient, such notice, email or communication
shall be deemed to have been sent at the opening of business on the next
business day for the recipient.

 

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(c)           [Reserved].

 

(d)           Change of Address, Etc.  Each Borrower and the Administrative
Agent may change its address, facsimile or telephone number for notices and
other communications hereunder by notice to the other parties hereto.  Each
Lender may change its address, facsimile or telephone number for notices and
other communications hereunder by notice to the Borrowers and the Administrative
Agent.  In addition, each Lender agrees to notify the Administrative Agent from
time to time to ensure that the Administrative Agent has on record (i) an
effective address, contact name, telephone number, facsimile number and
electronic mail address to which notices and other communications may be sent
and (ii) accurate wire instructions for such Lender.

 

(e)           Reliance by Administrative Agent and Lenders.  The Administrative
Agent and the Lenders shall be entitled to rely and act upon any notices
(including telephonic Loan Notices) purportedly given by or on behalf of any
Loan Party even if (i) such notices were not made in a manner specified herein,
were incomplete or were not preceded or followed by any other form of notice
specified herein, or (ii) the terms thereof, as understood by the recipient,
varied from any confirmation thereof. The Loan Parties shall indemnify the
Administrative Agent, each Lender and the Related Parties of each of them from
all losses, costs, expenses and liabilities resulting from the reliance by such
Person on each notice purportedly given by or on behalf of a Loan Party.  All
telephonic notices to and other telephonic communications with the
Administrative Agent may be recorded by the Administrative Agent, and each of
the parties hereto hereby consents to such recording.

 

11.3        No Waiver; Cumulative Remedies; Enforcement.

 

No failure by any Lender or the Administrative Agent to exercise, and no delay
by any such Person in exercising, any right, remedy, power or privilege
hereunder or under any other Loan Document shall operate as a waiver thereof;
nor shall any single or partial exercise of any right, remedy, power or
privilege hereunder or under any other Loan Document (including the imposition
of the Default Rate) preclude any other or further exercise thereof or the
exercise of any other right, remedy, power or privilege. The rights, remedies,
powers and privileges herein provided, and provided under each other Loan
Document are cumulative and not exclusive of any rights, remedies, powers and
privileges provided by Law.

 

Notwithstanding anything to the contrary contained herein or in any other Loan
Document, the authority to enforce rights and remedies hereunder and under the
other Loan Documents against the Loan Parties or any of them shall be vested
exclusively in, and all actions and proceedings at law in connection with such
enforcement shall be instituted and maintained exclusively by, the
Administrative Agent in accordance with Section 8.2 for the benefit of all the
Lenders; provided, however, that the foregoing shall not prohibit (a) the
Administrative Agent from exercising on its own behalf the rights and remedies
that inure to its benefit (solely in its capacity as Administrative Agent)
hereunder and under the other Loan Documents, (b) any Lender from exercising
setoff rights in accordance with Section 11.8 (subject to the terms of
Section 2.13), or (c) any Lender from filing proofs of claim or appearing and
filing pleadings on its own behalf during the pendency of a proceeding relative
to any Loan Party under any Debtor Relief Law; and provided, further, that if at
any time there is no Person acting as Administrative Agent hereunder and under
the other Loan Documents, then (i) the Required Lenders shall have the rights
otherwise ascribed to the Administrative Agent pursuant to Section 8.2 and
(ii) in addition to the matters set forth in clauses (b), (c) and (d) of the
preceding proviso and subject to Section 2.13, any Lender may, with the consent
of the Required Lenders, enforce any rights and remedies available to it and as
authorized by the Required Lenders.

 

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11.4        Expenses; Indemnity; Damage Waiver.

 

(a)           Costs and Expenses.  The Loan Parties shall pay (i) all reasonable
out of pocket expenses incurred by the Administrative Agent and its Affiliates
(including the reasonable fees, charges and disbursements of counsel for the
Administrative Agent and any Lender) in connection with the preparation,
negotiation, execution, delivery and administration of this Agreement and the
other Loan Documents, the Bankruptcy Court Orders or any amendments,
modifications or waivers of the provisions hereof or thereof (whether or not the
transactions contemplated hereby or thereby shall be consummated) and the
Chapter 11 Case, and (ii) all out of pocket expenses incurred by the
Administrative Agent or any Lender (including the fees, charges and
disbursements of any counsel for the Administrative Agent or any Lender), and
shall pay all fees and time charges for attorneys who may be employees of the
Administrative Agent or any Lender, in connection with the enforcement or
protection of its rights (A) in connection with this Agreement and the other
Loan Documents, the Bankruptcy Court Orders and the Chapter 11 Case, including
its rights under this Section, or in connection with the Loans made hereunder
and the other Obligations, including all such out of pocket expenses incurred
during any workout, restructuring or negotiations in respect of such Loans. 
Notwithstanding anything to the contrary herein, the cost and expense
reimbursement provided herein shall not extend to the Administrative Agent, any
Lender or any of their Related Parties or any of their successors or permitted
assigns in their capacity as a Prepetition Secured Party.

 

(b)           Indemnification by the Loan Parties.  The Loan Parties shall
indemnify the Administrative Agent (and any sub-agent thereof) and each Lender,
and each Related Party of any of the foregoing Persons (each such Person being
called an “Indemnitee”) against, and hold each Indemnitee harmless from, any and
all losses, claims, damages, liabilities and related expenses (including the
fees, charges and disbursements of counsel for any Indemnitee) incurred by any
Indemnitee or asserted against any Indemnitee by any Person (including any Loan
Party) arising out of, in connection with, or as a result of (i) the Bankruptcy
Court Orders, the Chapter 11 Case or the execution or delivery of this
Agreement, any other Loan Document or any agreement or instrument contemplated
hereby or thereby, the performance by the parties hereto of their respective
obligations hereunder or thereunder, the consummation of the transactions
contemplated hereby or thereby or by the Bankruptcy Court Orders or the Chapter
11 Case, or, in the case of the Administrative Agent (and any sub-agent thereof)
and its Related Parties only, the administration of this Agreement and the other
Loan Documents (including in respect of any matters addressed in Section 3.1),
(ii) any Loan or the use or proposed use of the proceeds therefrom, (iii) any
actual or alleged presence or release of Hazardous Materials on or from any
property owned or operated by a Loan Party or any of its Subsidiaries, or any
Environmental Liability related in any way to a Loan Party or any of its
Subsidiaries, or (iv) any actual or prospective claim, litigation, investigation
or proceeding relating to any of the foregoing, whether based on contract, tort
or any other theory, whether brought by a third party or by any Loan Party, and
regardless of whether any Indemnitee is a party thereto, IN ALL CASES, WHETHER
OR NOT CAUSED BY OR ARISING, IN WHOLE OR IN PART, OUT OF THE COMPARATIVE,
CONTRIBUTORY OR SOLE NEGLIGENCE OF THE INDEMNITEE; provided that such indemnity
shall not, as to any Indemnitee, be available to the extent that such losses,
claims, damages, liabilities or related expenses (x) are determined by a court
of competent jurisdiction by final and nonappealable judgment to have resulted
from the gross negligence, bad faith or willful misconduct of such Indemnitee or
any Related Indemnified Person of such Indemnitee or (y) result from a claim
brought by any Loan Party against an Indemnitee for breach in bad faith of such
Indemnitee’s obligations hereunder or under any other Loan Document, if such
Loan Party has obtained a final and nonappealable judgment in its favor on such
claim as determined by a court of competent jurisdiction. Without limiting the
provisions of Section 3.1(c), this Section 11.4(b) shall not apply with respect
to Taxes other than any Taxes that represent losses, claims, damages, etc.
arising from any non-Tax claim.  Notwithstanding anything to the contrary
herein, the indemnification provided herein shall not extend to the
Administrative Agent (and any sub-agent thereof) and each Lender, and each
Related Party of any of the foregoing Persons in their capacity as a Prepetition
Secured Party.

 

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(c)           Reimbursement by Lenders.  To the extent that the Loan Parties for
any reason fail to indefeasibly pay any amount required under subsection (a) or
(b) of this Section to be paid by them to the Administrative Agent (or any
sub-agent thereof) or any Related Party of the Administrative Agent, each Lender
severally agrees to pay to the Administrative Agent (or any such sub-agent) or
such Related Party, as the case may be, such Lender’s pro rata share (determined
as of the time that the applicable unreimbursed expense or indemnity payment is
sought based on each Lender’s share of the Total Credit Exposures of all Lenders
at such time) of such unpaid amount (including any such unpaid amount in respect
of a claim asserted by such Lender), such payment to be made severally among
them based on such Lenders’ Applicable Percentage (determined as of the time
that the applicable unreimbursed expense or indemnity payment is sought),
provided, further that, the unreimbursed expense or indemnified loss, claim,
damage, liability or related expense, as the case may be, was incurred by or
asserted against the Administrative Agent (or any such sub-agent) or against any
Related Party of the Administrative Agent acting for the Administrative Agent
(or any such sub-agent) in connection with such capacity. The obligations of the
Lenders under this subsection (c) are subject to the provisions of
Section 2.12(d).

 

(d)           Waiver of Consequential Damages, Etc.  To the fullest extent
permitted by applicable Law, no Loan Party shall assert, and each Loan Party
hereby waives, and acknowledges that no other Person shall have, any claim
against any Indemnitee, on any theory of liability, for special, indirect,
consequential or punitive damages (as opposed to direct or actual damages)
arising out of, in connection with, or as a result of, this Agreement, any other
Loan Document or any agreement or instrument contemplated hereby, the
transactions contemplated hereby or thereby, any Loan or the use of the proceeds
thereof. No Indemnitee shall be liable for any damages arising from the use by
unintended recipients of any information or other materials distributed to such
unintended recipients by such Indemnitee through telecommunications, electronic
or other information transmission systems in connection with this Agreement or
the other Loan Documents or the transactions contemplated hereby or thereby.

 

(e)           Payments.  All amounts due under this Section shall be payable not
later than ten Business Days after demand therefor.

 

(f)            Survival.  The agreements in this Section and the indemnity
provisions of Section 11.2(e) shall survive the resignation of the
Administrative Agent, the replacement of any Lender, the termination of the
Commitments and the repayment, satisfaction or discharge of all the other
Obligations.

 

11.5        Payments Set Aside.

 

To the extent that any payment by or on behalf of any Loan Party is made to the
Administrative Agent or any Lender, or the Administrative Agent or any Lender
exercises its right of setoff, and such payment or the proceeds of such setoff
or any part thereof is subsequently invalidated, declared to be fraudulent or
preferential, set aside or required (including pursuant to any settlement
entered into by the Administrative Agent or such Lender in its discretion) to be
repaid to a trustee, receiver or any other party, in connection with any
proceeding under any Debtor Relief Law or otherwise, then (a) to the extent of
such recovery, the obligation or part thereof originally intended to be
satisfied shall be revived and continued in full force and effect as if such
payment had not been made or such setoff had not occurred, and (b) each Lender
severally agrees to pay to the Administrative Agent upon demand its applicable
share (without duplication) of any amount so recovered from or repaid by the
Administrative Agent, plus interest thereon from the date of such demand to the
date such payment is made at a rate per annum equal to the Federal Funds Rate
from time to time in effect. The obligations of the Lenders under clause (b) of
the preceding sentence shall survive the payment in full of the Obligations, the
termination of the Commitments and this Agreement and the occurrence of the
Facility Termination Date.

 

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11.6        Successors and Assigns.

 

(a)           Successors and Assigns Generally.  The provisions of this
Agreement and the other Loan Documents shall be binding upon and inure to the
benefit of the parties hereto and thereto and their respective successors and
assigns permitted hereby, except that the Borrowers may not assign or otherwise
transfer any of their rights or obligations hereunder or thereunder without the
prior written consent of the Administrative Agent and each Lender and no Lender
may assign or otherwise transfer any of its rights or obligations hereunder
except (i) to an assignee in accordance with the provisions of subsection (b) of
this Section, (ii) by way of participation in accordance with the provisions of
subsection (d) of this Section or by way of pledge or assignment of a security
interest subject to the restrictions of subsection (e) of this Section (and any
other attempted assignment or transfer by any party hereto shall be null and
void). Nothing in this Agreement, expressed or implied, shall be construed to
confer upon any Person (other than the parties hereto, their respective
successors and assigns permitted hereby, Participants to the extent provided in
subsection (d) of this Section and, to the extent expressly contemplated hereby,
the Related Parties of each of the Administrative Agent and the Lenders) any
legal or equitable right, remedy or claim under or by reason of this Agreement.

 

(b)           Assignments by Lenders.  Any Lender may at any time assign to one
or more assignees all or a portion of its rights and obligations under this
Agreement and the other Loan Documents (including all or a portion of its
Commitment and the Loans at the time owing to it); provided that any such
assignment shall be subject to the following conditions:

 

(i)            [Reserved].

 

(ii)           Assignment and Assumption.  The parties to each assignment shall
execute and deliver to the Borrower an Assignment and Assumption.  The assignee,
if it shall not be a Lender or an Affiliate of a Lender, shall deliver to the
Borrowers an Administrative Questionnaire.

 

(iii)          No Assignment to Certain Persons.  No such assignment shall be
made to (A) the Borrowers or any of the Borrowers’ Subsidiaries or (B) a natural
Person (or a holding company, investment vehicle or trust for, or owned and
operated for the primary benefit of a natural Person).

 

From and after the effective date specified in each Assignment and Assumption,
the assignee thereunder shall be a party to this Agreement and, to the extent of
the interest assigned by such Assignment and Assumption, have the rights and
obligations of a Lender under this Agreement, and the assigning Lender
thereunder shall, to the extent of the interest assigned by such Assignment and
Assumption, be released from its obligations under this Agreement (and, in the
case of an Assignment and Assumption covering all of the assigning Lender’s
rights and obligations under this Agreement, such Lender shall cease to be a
party hereto but shall continue to be entitled to the benefits of Sections 3.1,
3.4 and 11.4 with respect to facts and circumstances occurring prior to the
effective date of such assignment). Upon request, the Borrowers (at their
expense) shall execute and deliver a Note to the assignee Lender.  Any
assignment or transfer by a Lender of rights or obligations under this Agreement
that does not comply with this subsection shall be treated for purposes of this
Agreement as a sale by such Lender of a participation in such rights and
obligations in accordance with subsection (d) of this Section.

 

(c)           Register.  The Borrowers, shall maintain at their address referred
to in Section 11.2 a copy of each Assignment and Assumption delivered to it (or
the equivalent thereof in electronic form) and a register for the recordation of
the names and addresses of the Lenders, and principal amounts (and stated
interest) of the Loans owing to, each Lender pursuant to the terms hereof from
time to time (the “Register”). The Borrowers, the Administrative Agent and the
Lenders shall treat each Person whose

 

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name is recorded in the Register pursuant to the terms hereof as a Lender
hereunder for all purposes of this Agreement.  With respect to any discrepancies
between the Register maintained by the Borrower and any records maintained by
the Administrative Agent or the Lenders, the records of the Administrative Agent
and/or such Lenders shall govern and control.  The Register shall be available
for inspection by the Administrative Agent or any Lender at any reasonable time
and from time to time upon reasonable prior notice.

 

(d)           Participations.  Any Lender may at any time, without the consent
of, or notice to, the Borrowers or the Administrative Agent, sell participations
to any Person (other than a natural Person (or a holding company, investment
vehicle or trust for, or owned and operated for the primary benefit of a natural
Person) or the Borrowers or any of the Borrowers’ Affiliates or Subsidiaries)
(each, a “Participant”) in all or a portion of such Lender’s rights and/or
obligations under this Agreement (including all or a portion of the Loans);
provided that (i) such Lender’s obligations under this Agreement shall remain
unchanged, (ii) such Lender shall remain solely responsible to the other parties
hereto for the performance of such obligations and (iii) the Borrowers, the
Administrative Agent and the Lenders shall continue to deal solely and directly
with such Lender in connection with such Lender’s rights and obligations under
this Agreement. For the avoidance of doubt, each Lender shall be responsible for
the indemnity under Section 11.4(c) without regard to the existence of any
participation.

 

Any agreement or instrument pursuant to which a Lender sells such a
participation shall provide that such Lender shall retain the sole right to
enforce this Agreement and to approve any amendment, modification or waiver of
any provision of this Agreement; provided that such agreement or instrument may
provide that such Lender will not, without the consent of the Participant, agree
to any amendment, waiver or other modification described in Section 11.1(a) that
affects such Participant.  The Borrowers agree that each Participant shall be
entitled to the benefits of Sections 3.1 and 3.4 to the same extent as if it
were a Lender and had acquired its interest by assignment pursuant to subsection
(b) of this Section (it being understood that the documentation required under
Section 3.1(e) shall be delivered to the Lender who sells the participation) to
the same extent as if it were a Lender and had acquired its interest by
assignment pursuant to paragraph (b) of this Section; provided that such
Participant (A) agrees to be subject to the provisions of Sections 3.6 as if it
were an assignee under paragraph (b) of this Section and (B) shall not be
entitled to receive any greater payment under Sections 3.1 or 3.4, with respect
to any participation, than the Lender from whom it acquired the applicable
participation would have been entitled to receive, except to the extent such
entitlement to receive a greater payment results from a Change in Law that
occurs after the Participant acquired the applicable participation. Each Lender
that sells participation agrees, at the Borrowers’ request and expense, to use
reasonable efforts to cooperate with the Borrower to effectuate the provisions
of Section 3.6 with respect to any Participant.  To the extent permitted by Law,
each Participant also shall be entitled to the benefits of Section 11.8 as
though it were a Lender; provided that such Participant agrees to be subject to
Section 2.13 as though it were a Lender.  Each Lender that sells a participation
shall, acting solely for this purpose as a non-fiduciary agent of the Borrowers,
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 the Loan Documents (the “Participant
Register”); provided that no Lender shall have any obligation to disclose all or
any portion of the Participant Register (including the identity of any
Participant or any information relating to a Participant’s interest in any
commitments, loans, letters of credit or its other obligations under any Loan
Document) to any Person except to the extent that such disclosure is necessary
to establish that such commitment, loan, letter of credit or other obligation is
in registered form under Section 5f.103-1(c) of the United States Treasury
Regulations. The entries in the Participant Register shall be conclusive absent
manifest error, 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.  For the avoidance
of doubt, neither Borrower

 

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nor the Administrative Agent (in its capacity as Administrative Agent) shall
have any responsibility for maintaining a Participant Register.

 

(e)           Certain Pledges.  Any Lender may at any time pledge or assign a
security interest in all or any portion of its rights under this Agreement
(including under its Note, if any) to secure obligations of such Lender,
including any pledge or assignment to secure obligations to a Federal Reserve
Bank; provided that no such pledge or assignment shall release such Lender from
any of its obligations hereunder or substitute any such pledgee or assignee for
such Lender as a party hereto.

 

11.7        Treatment of Certain Information; Confidentiality.

 

Each of the Administrative Agent and the Lenders agrees to maintain the
confidentiality of the Information (as defined below), except that Information
may be disclosed (a) to its Affiliates and to its Related Parties (it being
understood that the Persons to whom such disclosure is made will be informed of
the confidential nature of such Information and instructed to keep such
Information confidential), (b) to the extent required or requested by any
regulatory authority purporting to have jurisdiction over such Person or its
Related Parties (including any self-regulatory authority, such as the National
Association of Insurance Commissioners), (c) to the extent required by
applicable Laws or regulations or by any subpoena or similar legal process,
(d) to any other party hereto, (e) in connection with the exercise of any
remedies hereunder or under any other Loan Document or any action or proceeding
relating to this Agreement or any other Loan Document or the enforcement of
rights hereunder or thereunder, (f) subject to an agreement containing
provisions substantially the same as those of this Section, to (i) any assignee
of or Participant in, or any prospective assignee of or Participant in, any of
its rights and obligations under this Agreement or (ii) any actual or
prospective party (or its Related Parties) to any swap, derivative or other
transaction under which payments are to be made by reference to the Borrower and
its obligations, this Agreement or payments hereunder, (g) on a confidential
basis to (i) any rating agency in connection with rating any Loan Party or its
Subsidiaries or the credit facilities provided hereunder or (ii) the CUSIP
Service Bureau or any similar agency in connection with the issuance and
monitoring of CUSIP numbers or other market identifiers with respect to the
credit facilities provided hereunder, (h) with the consent of the Borrower or
(i) to the extent such Information (x) becomes publicly available other than as
a result of a breach of this Section or (y) becomes available to the
Administrative Agent, any Lender or any of their respective Affiliates on a
nonconfidential basis from a source other than the Borrower. In addition, the
Administrative Agent and the Lenders may disclose the existence of this
Agreement and information about this Agreement to market data collectors,
similar service providers to the lending industry and service providers to the
Administrative Agent and the Lenders in connection with the administration of
this Agreement, the other Loan Documents, and the Commitments.

 

For purposes of this Section, “Information” means all information received from
a Loan Party or any Subsidiary relating to the Loan Parties or any Subsidiary or
any of their respective businesses, other than any such information that is
available to the Administrative Agent or any Lender on a nonconfidential basis
prior to disclosure by such Loan Party or any Subsidiary, provided that, in the
case of information received from a Loan Party or any Subsidiary after the
Closing Date, such information is clearly identified at the time of delivery as
confidential. Any Person required to maintain the confidentiality of Information
as provided in this Section shall be considered to have complied with its
obligation to do so if such Person has exercised the same degree of care to
maintain the confidentiality of such Information as such Person would accord to
its own confidential information.

 

The Loan Parties and their Affiliates agree that they will not in the future
issue any press releases or other public disclosure using the name of the
Administrative Agent or any Lender or their respective Affiliates or referring
to this Agreement or any of the Loan Documents without the prior written consent
of the Administrative Agent, unless (and only to the extent that) the Loan
Parties or such Affiliate is

 

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required to do so under law and, in any event the Loan Parties and their
Affiliates will provide the Administrative Agent with a copy of, and consult
with the Administrative Agent before issuing, any press release or other public
disclosure with respect to the Agreement or the other Loan Documents or the
transactions contemplated hereby or thereby and will consider in good faith any
comments of the Administrative Agent.

 

11.8        Rights of Setoff.

 

If an Event of Default shall have occurred and be continuing, each Lender and
each of such Lender’s Affiliates is hereby authorized at any time and from time
to time, to the fullest extent permitted by applicable Law, to set off and apply
any and all deposits (general or special, time or demand, provisional or final,
in whatever currency) at any time held and other obligations (in whatever
currency) at any time owing by such Lender, or any such Affiliate to or for the
credit or the account of any Loan Party against any and all of the obligations
of such Loan Party now or hereafter existing under this Agreement or any other
Loan Document to such Lender or its Affiliates, irrespective of whether or not
such Lender or such Affiliate shall have made any demand under this Agreement or
any other Loan Document and although such obligations of such Loan Party may be
contingent or unmatured or are owed to a branch or office or Affiliate of such
Lender different from the branch or office or Affiliate holding such deposit or
obligated on such indebtedness. The rights of each Lender and its Affiliates
under this Section are in addition to other rights and remedies (including other
rights of setoff) that such Lender or its Affiliates may have.  Each Lender
agrees to notify the Borrowers and the Administrative Agent promptly after any
such setoff and application, provided that the failure to give such notice shall
not affect the validity of such setoff and application.

 

11.9        Interest Rate Limitation.

 

Notwithstanding anything to the contrary contained in any Loan Document, the
interest paid or agreed to be paid under the Loan Documents shall not exceed the
maximum rate of non-usurious interest permitted by applicable Law (the “Maximum
Rate”).  If the Administrative Agent or any Lender shall receive interest in an
amount that exceeds the Maximum Rate, the excess interest shall be applied to
the principal of the Loans or, if it exceeds such unpaid principal, refunded to
the Borrower.  In determining whether the interest contracted for, charged, or
received by the Administrative Agent or a Lender exceeds the Maximum Rate, such
Person may, to the extent permitted by applicable Law, (a) characterize any
payment that is not principal as an expense, fee, or premium rather than
interest, (b) exclude voluntary prepayments and the effects thereof, and
(c) amortize, prorate, allocate, and spread in equal or unequal parts the total
amount of interest throughout the contemplated term of the Obligations
hereunder.

 

It is the intention of the parties to comply with applicable usury Law.  The
parties agree that the total amount of interest contracted for, charged,
collected or received by the Administrative Agent and the Lenders under this
Agreement shall not exceed the Maximum Rate.  Notwithstanding any contrary
provisions contained herein, (a) the Maximum Rate shall be calculated on the
basis of the actual number of days elapsed over a year of 365 or 366 days, as
the case may be; (b) in determining whether the interest hereunder exceeds
interest at the Maximum Rate, the total amount of interest shall be spread
throughout the entire term of this Agreement until its payment in full; and
(c) if at any time the interest rate chargeable under this Agreement would
exceed the Maximum Rate, thereby causing the interest payable under this
Agreement to be limited to the Maximum Rate, then any subsequent reductions in
the interest rate(s) shall not reduce the rate of interest charged under this
Agreement below the Maximum Rate until the total amount of interest accrued from
and after the date of this Agreement equals the amount of interest which would
have accrued if the interest rate(s) had at all times been in effect.

 

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11.10      Counterparts; Integration; Effectiveness.

 

This Agreement and each of the other Loan Documents may be executed in
counterparts (and by different parties hereto in different counterparts), each
of which shall constitute an original, but all of which when taken together
shall constitute a single contract.  This Agreement, the other Loan Documents
and any separate letter agreements with respect to fees payable to the
Administrative Agent constitute the entire contract among the parties relating
to the subject matter hereof and supersede any and all previous agreements and
understandings, oral or written, relating to the subject matter hereof.  Except
as provided in Section 4.1, this Agreement shall become effective when it shall
have been executed by the Administrative Agent and when the Administrative Agent
shall have received counterparts hereof that, when taken together, bear the
signatures of each of the other parties hereto.  Delivery of an executed
counterpart of a signature page of this Agreement, such other document or
certificate (as applicable) by fax transmission or e-mail transmission (e.g.,
“pdf” or “tif”) shall be effective as delivery of a manually executed
counterpart of this Agreement, such other Loan Document or certificate (as
applicable).  Without limiting the foregoing, to the extent a manually executed
counterpart is not specifically required to be delivered under the terms of any
Loan Document, upon the request of any party, such fax transmission or e-mail
transmission shall be promptly followed by such manually executed counterpart.

 

11.11      Survival of Representations and Warranties.

 

All representations and warranties made hereunder and in any other Loan Document
or other document delivered pursuant hereto or thereto or in connection herewith
or therewith shall survive (and shall continue to be made in accordance with the
terms hereof and thereof after) the execution and delivery hereof and thereof. 
Such representations and warranties have been or will be relied upon by the
Administrative Agent and each Lender, regardless of any investigation made by
the Administrative Agent or any Lender or on their behalf and notwithstanding
that the Administrative Agent or any Lender may have had notice or knowledge of
any Default at the time of any Credit Extension, and shall continue in full
force and effect (and shall continue to be made in accordance with the terms of
the applicable Loan Documents) as long as any Loan or any other Obligation
hereunder shall remain unpaid or unsatisfied or the Facility Termination Date
has not occurred.  Notwithstanding anything to the contrary in the Loan
Documents, the obligations of the Loan Parties under Article III and any
provisions that concern or are related to the obligations of the Loan Parties
and the Lenders under this Article XI shall survive and remain in full force and
effect regardless of the consummation of the transactions contemplated hereby,
the repayment of the Loans and the other Obligations or the termination of this
Agreement or any of the other Loan Documents or any provision hereof or thereof.

 

11.12      Severability.

 

If any provision of this Agreement or the other Loan Documents is held to be
illegal, invalid or unenforceable, (a) the legality, validity and enforceability
of the remaining provisions of this Agreement and the other Loan Documents shall
not be affected or impaired thereby and (b) the parties shall endeavor in good
faith negotiations to replace the illegal, invalid or unenforceable provisions
with valid provisions the economic effect of which comes as close as possible to
that of the illegal, invalid or unenforceable provisions. The invalidity of a
provision in a particular jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.

 

11.13      Parties Including Trustees; Bankruptcy Court Proceedings.

 

This Agreement, the other Loan Documents, and all Liens created hereby or
pursuant hereto or to any other Loan Document shall be binding upon each Loan
Party, the estate of each Loan Party, and any trustee or successor in interest
of any Loan Party in any Chapter 11 Case or any subsequent case

 

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commenced under Chapter 7 of the Bankruptcy Code or any other bankruptcy or
insolvency laws, and shall not be subject to Section 365 of the Bankruptcy
Code.  This Agreement and the other Loan Documents shall be binding upon, and
inure to the benefit of, the successors of the Administrative Agent and Lenders
and their respective assigns, transferees and endorsees.  The Liens created by
this Agreement, the other Loan Documents and the Bankruptcy Court Orders shall
be and remain valid and perfected in the event of the substantive consolidation
or conversion of any Chapter 11 Case or any other bankruptcy case of any Loan
Party to a case under Chapter 7 of the Bankruptcy Code, or in the event of
dismissal of any Chapter 11 Case or the release of any Collateral from the
jurisdiction of the Bankruptcy Court for any reason, without the necessity that
Lenders file financing statements or otherwise perfect its security interests or
Liens under applicable law.

 

11.14                 Governing Law; Jurisdiction; Etc.

 

(a)           GOVERNING LAW.  THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS
(EXCEPT, AS TO ANY OTHER LOAN DOCUMENT, AS EXPRESSLY SET FORTH THEREIN) AND ANY
CLAIMS, CONTROVERSY, DISPUTE OR CAUSE OF ACTION (WHETHER IN CONTRACT OR TORT OR
OTHERWISE) BASED UPON, ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OTHER
LOAN DOCUMENT (EXCEPT, AS TO ANY OTHER LOAN DOCUMENT, AS EXPRESSLY SET FORTH
THEREIN) AND THE TRANSACTIONS CONTEMPLATED HEREBY AND THEREBY SHALL BE GOVERNED
BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK (AND, AS
APPLICABLE, THE BANKRUPTCY CODE).

 

(b)           SUBMISSION TO JURISDICTION.  EACH LOAN PARTY IRREVOCABLY AND
UNCONDITIONALLY AGREES THAT IT WILL NOT COMMENCE ANY ACTION, LITIGATION OR
PROCEEDING OF ANY KIND OR DESCRIPTION, WHETHER IN LAW OR EQUITY, WHETHER IN
CONTRACT OR IN TORT OR OTHERWISE, AGAINST THE ADMINISTRATIVE AGENT, ANY LENDER,
OR ANY RELATED PARTY OF THE FOREGOING IN ANY WAY RELATING TO THIS AGREEMENT OR
ANY OTHER LOAN DOCUMENT OR THE TRANSACTIONS RELATING HERETO OR THERETO, IN ANY
FORUM OTHER THAN THE COURTS OF THE STATE OF NEW YORK SITTING IN NEW YORK COUNTY
AND OF THE UNITED STATES DISTRICT COURT OF THE SOUTHERN DISTRICT OF NEW YORK AND
THE BANKRUPTCY COURT, AND ANY APPELLATE COURT FROM ANY THEREOF, AND EACH OF THE
PARTIES HERETO IRREVOCABLY AND UNCONDITIONALLY SUBMITS TO THE JURISDICTION OF
SUCH COURTS AND AGREES THAT ALL CLAIMS IN RESPECT OF ANY SUCH ACTION, LITIGATION
OR PROCEEDING MAY BE HEARD AND DETERMINED IN SUCH NEW YORK STATE COURT OR THE
BANKRUPTCY COURT OR, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, IN SUCH
FEDERAL COURT. EACH OF THE PARTIES HERETO AGREES THAT A FINAL JUDGMENT IN ANY
SUCH ACTION, LITIGATION OR PROCEEDING SHALL BE CONCLUSIVE AND MAY BE ENFORCED IN
OTHER JURISDICTIONS BY SUIT ON THE JUDGMENT OR IN ANY OTHER MANNER PROVIDED BY
LAW.  NOTHING IN THIS AGREEMENT OR IN ANY OTHER LOAN DOCUMENT SHALL AFFECT ANY
RIGHT THAT THE ADMINISTRATIVE AGENT OR ANY LENDER MAY OTHERWISE HAVE TO BRING
ANY ACTION OR PROCEEDING RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT
AGAINST ANY LOAN PARTY OR ITS PROPERTIES IN THE COURTS OF ANY JURISDICTION. 
NOTWITHSTANDING ANY OTHER PROVISION OF THIS SECTION 11.14, THE BANKRUPTCY COURT
SHALL HAVE JURISDICTION OVER ANY ACTION OR DISPUTE INVOLVING, RELATING TO OR
ARISING OUT OF THIS AGREEMENT OR THE OTHER LOAN DOCUMENTS.

 

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(c)           WAIVER OF VENUE.  EACH LOAN PARTY IRREVOCABLY AND UNCONDITIONALLY
WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY OBJECTION THAT IT
MAY NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY ACTION OR PROCEEDING
ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT IN ANY
COURT REFERRED TO IN PARAGRAPH (B) OF THIS SECTION.  EACH OF THE PARTIES HERETO
HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW,
THE DEFENSE OF AN INCONVENIENT FORUM TO THE MAINTENANCE OF SUCH ACTION OR
PROCEEDING IN ANY SUCH COURT.

 

(d)           SERVICE OF PROCESS.  EACH PARTY HERETO IRREVOCABLY CONSENTS TO
SERVICE OF PROCESS IN THE MANNER PROVIDED FOR NOTICES IN SECTION 11.2.  NOTHING
IN THIS AGREEMENT WILL AFFECT THE RIGHT OF ANY PARTY HERETO TO SERVE PROCESS IN
ANY OTHER MANNER PERMITTED BY APPLICABLE LAW.

 

11.15                 Waiver of Jury Trial.

 

EACH PARTY HERETO HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY
APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING
DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OTHER
LOAN DOCUMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY (WHETHER BASED
ON CONTRACT, TORT OR ANY OTHER THEORY).  EACH PARTY HERETO (A) CERTIFIES THAT NO
REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PERSON HAS REPRESENTED, EXPRESSLY
OR OTHERWISE, THAT SUCH OTHER PERSON WOULD NOT, IN THE EVENT OF LITIGATION, SEEK
TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER
PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT AND THE OTHER LOAN
DOCUMENTS BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS
SECTION.

 

11.16                 No Advisory or Fiduciary Responsibility.

 

In connection with all aspects of each transaction contemplated hereby
(including in connection with any amendment, waiver or other modification hereof
or of any other Loan Document), each of the Loan Parties acknowledges and
agrees, and acknowledges its Affiliates’ understanding, that:  (i) (A) the
arranging and other services regarding this Agreement provided by the
Administrative Agent and the Lenders are arm’s-length commercial transactions
between the Loan Parties and their respective Affiliates, on the one hand, and
the Administrative Agent and the Lenders, on the other hand, (B) each of the
Loan Parties has consulted its own legal, accounting, regulatory and tax
advisors to the extent it has deemed appropriate, and (C) each of the Loan
Parties is capable of evaluating, and understands and accepts, the terms, risks
and conditions of the transactions contemplated hereby and by the other Loan
Documents; (ii) (A) the Administrative Agent and the Lenders each is and has
been acting solely as a principal and, except as expressly agreed in writing by
the relevant parties, has not been, is not, and will not be acting as an
advisor, agent or fiduciary for the Loan Parties or any of their respective
Affiliates, or any other Person and (B) neither the Administrative Agent nor any
Lender has any obligation to the Loan Parties or any of their respective
Affiliates with respect to the transactions contemplated hereby except those
obligations expressly set forth herein and in the other Loan Documents; and
(iii) the Administrative Agent, the Lenders and their respective Affiliates may
be engaged in a broad range of transactions that involve interests that differ
from those of the Loan Parties and their respective Affiliates, and neither the
Administrative Agent nor any Lender has any obligation to disclose any of such
interests to the Loan Parties and their respective Affiliates. To the fullest
extent permitted by Law, each of the Loan Parties

 

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hereby waives and releases any claims that it may have against the
Administrative Agent or any Lender with respect to any breach or alleged breach
of agency or fiduciary duty in connection with any aspect of any transaction
contemplated hereby.

 

11.17                 Electronic Execution of Assignments and Certain Other
Documents.

 

The words “execute,” “execution,” “signed,” “signature,” and words of like
import in or related to any document to be signed in connection with this
Agreement, any other document executed in connection herewith and the
transactions contemplated hereby (including Assignment and Assumptions,
amendments or other modifications, Loan Notices, waivers and consents) 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, physical delivery 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; provided that notwithstanding anything contained herein to the
contrary the Administrative Agent is under no obligation to agree to accept
electronic signatures in any form or in any format unless expressly agreed to by
the Administrative Agent pursuant to procedures approved by it; provided further
without limiting the foregoing, upon the request of any party, any electronic
signature shall be promptly followed by such manually executed counterpart.

 

11.18                 USA PATRIOT Act Notice.

 

Each Lender that is subject to the Patriot Act (as hereinafter defined) and the
Administrative Agent (for itself and not on behalf of any Lender) hereby
notifies the Loan Parties that pursuant to the requirements of the USA PATRIOT
Act (Title III of Pub.  L. 107-56 (signed into law October 26, 2001)) (the
“Patriot Act”), it is required to obtain, verify and record information that
identifies the Loan Parties, which information includes the name and address of
the Loan Parties and other information that will allow such Lender or the
Administrative Agent, as applicable, to identify the Loan Parties in accordance
with the Patriot Act.  The Loan Parties shall, promptly following a request by
the Administrative Agent or any Lender, provide all documentation and other
information that the Administrative Agent or such Lender requests in order to
comply with its ongoing obligations under applicable “know your customer” and
anti-money laundering rules and regulations, including the Patriot Act.

 

11.19                 Subordination of Intercompany Indebtedness.

 

Each Loan Party (a “Subordinating Loan Party”) agrees that the payment of all
obligations and indebtedness, whether principal, interest, fees and other
amounts and whether now owing or hereafter arising, owing to such Subordinating
Loan Party by any other Loan Party is expressly subordinated to the payment in
full in cash of the Obligations.  If the Administrative Agent so requests, any
such obligation or indebtedness shall be enforced and performance received by
the Subordinating Loan Party as trustee for the Secured Parties and the proceeds
thereof shall be paid over to the Secured Parties on account of the Obligations,
but without reducing or affecting in any manner the liability of the
Subordinating Loan Party under this Agreement or any other Loan Document. 
Without limitation of the foregoing, so long as no Default has occurred and is
continuing, the Loan Parties may make and receive payments with respect to any
such obligations and indebtedness, provided, that in the event that any Loan
Party receives any payment of any such obligations and indebtedness at a time
when such payment is prohibited by this Section, such payment shall be held by
such Loan Party, in trust for the benefit of, and shall be paid forthwith over
and delivered, upon written request, to the Administrative Agent.

 

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11.20                 ENTIRE AGREEMENT.

 

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

 

11.21                 Acknowledgement and Consent to Bail-In of EEA Financial
Institutions.

 

Notwithstanding anything to the contrary in any Loan Document or in any other
agreement, arrangement or understanding among any such parties, each party
hereto acknowledges that any liability of any Lender that is an EEA Financial
Institution arising under any Loan Document, to the extent such liability is
unsecured, may be subject to the write-down and conversion powers of an EEA
Resolution Authority and agrees and consents to, and acknowledges and agrees to
be bound by:  (a) the application of any Write-Down and Conversion Powers by an
EEA Resolution Authority to any such liabilities arising hereunder which may be
payable to it by any Lender that is an EEA Financial Institution; and (b) the
effects of any Bail-In Action on any such liability, including, if applicable: 
(i) a reduction in full or in part or cancellation of any such liability; (ii) a
conversion of all, or a portion of, such liability into shares or other
instruments of ownership in such EEA Financial Institution, its parent
undertaking, or a bridge institution that may be issued to it or otherwise
conferred on it, and that such shares or other instruments of ownership will be
accepted by it in lieu of any rights with respect to any such liability under
this Agreement or any other Loan Document; or (iii) the variation of the terms
of such liability in connection with the exercise of the write-down and
conversion powers of any EEA Resolution Authority.

 

[SIGNATURE PAGES FOLLOW]

 

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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed as of the date first above written.

 

BORROWERS:

 

ARALEZ PHARMACEUTICALS US INC.

 

 

 

 

 

 

 

 

By:

/s/ Andrew I. Koven

 

 

Name:

Andrew I. Koven

 

 

Title:

President

 

 

 

 

 

 

 

 

 

 

POZEN INC.

 

 

 

 

 

 

 

 

 

 

By:

/s/ Andrew I. Koven

 

 

Name:

Andrew I. Koven

 

 

Title:

President

 

 

 

 

 

 

 

 

 

 

HALTON LABORATORIES LLC

 

 

 

 

 

 

 

 

 

 

By:

/s/ Andrew I. Koven

 

 

Name:

Andrew I. Koven

 

 

Title:

President

 

 

 

 

 

 

 

 

 

 

ARALEZ PHARMACEUTICALS MANAGEMENT, INC.

 

 

 

 

 

 

 

 

 

 

By:

/s/ Adrian Adams

 

 

Name:

Adrian Adams

 

 

Title:

Chief Executive Officer, Treasurer and Secretary

 

 

 

 

 

 

 

 

 

 

ARALEZ PHARMACEUTICALS HOLDINGS LIMITED

 

 

 

 

 

 

 

 

 

 

By:

/s/ Andrew I. Koven

 

 

Name:

Andrew I. Koven

 

 

Title:

Director

 

[Signature Page to Senior Secured Super-Priority Debtor-in-Possession Credit
Agreement]

 

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

 

 

 

ARALEZ PHARMACEUTICALS TRADING DESIGNATED ACTIVITY COMPANY

 

 

 

 

 

 

 

 

 

 

By:

/s/ Andrew I. Koven

 

 

Name:

Andrew I. Koven

 

 

Title:

Director

 

 

 

 

 

 

 

 

 

 

ARALEZ PHARMACEUTICALS R&D INC.

 

 

 

 

 

 

 

 

 

 

By:

/s/ Andrew I. Koven

 

 

Name:

Andrew I. Koven

 

 

Title:

President

 

[Signature Page to Senior Secured Super-Priority Debtor-in-Possession Credit
Agreement]

 

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

 

ADMINISTRATIVE AGENT:

 

DEERFIELD MANAGEMENT COMPANY, L.P.,
as Administrative Agent

 

 

 

 

 

 

By: Flynn Management, LLC, its General Partner

 

 

 

 

 

By:

/s/ David J. Clark

 

 

Name:

David J. Clark

 

 

Title:

Authorized Signatory

 

[Signature Page to Senior Secured Super-Priority Debtor-in-Possession Credit
Agreement]

 

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

 

LENDERS:

 

DEERFIELD PRIVATE DESIGN FUND III, L.P.

 

 

 

 

 

 

By: Deerfield Mgmt III, L.P., its General Partner
By: J.E. Flynn Capital III, LLC, its General Partner

 

 

 

 

 

By:

/s/ David J. Clark

 

 

Name:

David J. Clark

 

 

Title:

Authorized Signatory

 

 

 

 

 

 

 

 

 

 

DEERFIELD PARTNERS, L.P.

 

 

 

 

 

 

By: Deerfield Mgmt, L.P., its General Partner

By: J.E. Flynn Capital, LLC, its General Partner

 

 

 

 

 

 

By:

/s/ David J. Clark

 

 

Name:

David J. Clark

 

 

Title:

Authorized Signatory

 

[Signature Page to Senior Secured Super-Priority Debtor-in-Possession Credit
Agreement]

 

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