Exhibit 10.4
EXECUTION VERSION
     This INTERCREDITOR AGREEMENT, dated as of March 25, 2010 (this
“Agreement”), is between Jefferies Finance LLC, as agent for the First Priority
Secured Parties (as defined below) (in such capacity, the “First Priority
Agent”), and AmerisourceBergen Drug Corporation, a Delaware corporation
(“ABDC”).
PRELIMINARY STATEMENT
     Reference is made to (a) the credit agreement, dated as of March 25, 2010
(as amended, supplemented or otherwise modified from time to time in accordance
with the terms thereof, the “First Priority Debt Agreement”), among BioScrip,
Inc., a Delaware corporation (the “Company”), the lenders from time to time
party thereto (the “First Priority Creditors”), the subsidiary guarantors of the
Company from time to time party thereto, Jefferies Finance LLC, as lead
arranger, as book manager, as administrative agent for the First Priority
Creditors and as collateral agent for the First Priority Secured Parties, ING
Capital LLC, as syndication agent, Compass Bank, as a co-documentation agent,
General Electric Capital Corporation, a co-documentation agent, Healthcare
Finance Group, LLC, as collateral manager and issuing bank for the First
Priority Creditors, and HFG Healthco-4, LLC, as swingline lender for the First
Priority Creditors, (b) the security agreement, dated as of March 25, 2010 (as
amended, supplemented or otherwise modified from time to time in accordance with
the terms thereof, the “First Priority Security Agreement”), among the Company,
the subsidiaries of the Company from time to time party thereto, and the First
Priority Agent, (c) the other Loan Documents as defined, and referred to, in the
First Priority Debt Agreement, and (d) the prime vendor agreement, dated as of
July 1, 2009 (as amended, supplemented or otherwise modified from time to time
in accordance with the terms hereof, the “Prime Vendor Agreement”), between by
ABDC and the Company and certain subsidiaries of the Company.
RECITALS
     A. Pursuant to the Prime Vendor Agreement, the Grantors (as hereinafter
defined) granted ABDC a lien in all of their existing and future inventory and
accounts and proceeds thereof (including insurance proceeds).
     B. The First Priority Creditors have agreed to make loans and other
extensions of credit to the Company pursuant to the First Priority Debt
Agreement (in an aggregate committed principal amount, as of the Closing Date,
of $150,000,000, subject to the terms and conditions contained therein and in
the other Loan Documents) on the condition, among others, that the First
Priority Claims (such term and each other capitalized term used but not defined
in the preliminary statement or these recitals having the meaning given it in
Article I) shall be secured by first priority Liens on, and security interests
in, substantially all of the assets of the Company (including the Collateral),
and that the priority of the Liens securing the First Priority Claims be senior
and prior to the Liens securing the Second Priority Claims.
     C. ABDC has agreed to the subordination of Liens securing the Company’s
obligations under the Second Priority Financing Documents to the Liens securing
the First Priority Claims, upon the terms and subject to the conditions set
forth in this Agreement.
     D. The First Priority Debt Agreement requires, among other things, that the
First Priority Collateral Agent and ABDC set forth in this Agreement, among
other things, their respective rights, obligations and remedies with respect to
the Collateral.

 

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     Accordingly, the parties hereto agree as follows:
ARTICLE I
Definitions
          SECTION 1.01. Certain Defined Terms. Capitalized terms used in this
Agreement and not otherwise defined herein shall, except to the extent the
context otherwise requires, have the meanings set forth in the First Priority
Debt Agreement (as in effect on the date hereof) or the First Priority Security
Agreement (as in effect on the date hereof), as applicable.
          SECTION 1.02. Other Defined Terms. As used in this Agreement, the
following terms shall have the meanings specified below:
     “Agreement” shall have the meaning assigned to such term in the preamble
hereto.
     “Bankruptcy Code” shall mean Title 11 of the United States Code entitled
“Bankruptcy,” as now and hereinafter in effect, or any successor statute.
     “Bankruptcy Law” shall mean the Bankruptcy Code and any other Federal,
state or foreign bankruptcy, insolvency, receivership or similar law.
     “Collateral” shall mean, collectively, all Second Priority Collateral that
is (or purports to be or, pursuant to the terms hereof or any of the First
Priority Debt Documents, is required to be) part of the First Priority
Collateral.
     “Company” shall have the meaning assigned to such term in the preliminary
statement to this Agreement.
     “Debt Documents” shall mean the First Priority Debt Documents and the
Second Priority Financing Documents.
     “DIP Financing” shall have the meaning assigned to such term in
Section 5.01(a).
     “DIP Financing Liens” shall have the meaning assigned to such term in
Section 5.01(a).
     “Discharge of First Priority Claims” shall mean, subject to Sections 6.01
and 6.02, (a) payment in full in cash of the principal of and interest
(including interest accruing during the pendency of any Insolvency or
Liquidation Proceeding, regardless of whether allowed or allowable in such
Insolvency or Liquidation Proceeding) and premium, if any, on all Indebtedness
outstanding under the First Priority Debt Documents to the extent constituting
First Priority Claims, (b) payment in full in cash of all other First Priority
Claims that are due and payable or otherwise accrued and owing at or prior to
the time such principal and interest are paid, (c) cancellation of or the entry
into collateralization arrangements satisfactory to the First Priority Agent and
the Issuing Bank with respect to all Letters of Credit issued and outstanding
under the First Priority Debt Agreement, and (d) the termination or expiration
of all commitments to lend and all obligations to issue or extend Letters of
Credit under the First Priority Debt Agreement; provided, further, that, with
respect to each First Priority Creditor’s First Priority Claims, the acceptance
by such First Priority (in its absolute discretion) of non-cash consideration in
exchange for its First Priority Claims (or applicable specified portion
thereof), coupled with a written acknowledgment of discharge in form and
substance satisfactory to such First Priority

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Creditor, shall also constitute, subject to Section 6.02, a Discharge of First
Priority Claims only with respect to such exchanged First Priority Claims
relating to such First Priority Creditor.
     “Discharge of Second Priority Claims” shall mean, subject to Section 6.02,
payment in full in cash of all Indebtedness outstanding under the Second
Priority Financing Documents to the extent constituting Second Priority Claims
and the termination of all Second Priority Financing Documents.
     “Disposition” shall mean any sale, lease, exchange, transfer or other
disposition. “Dispose” shall have a correlative meaning.
     “First Priority Agent” shall have the meaning assigned to such term in the
preamble to this Agreement.
     “First Priority Claims” shall mean (i) the due and punctual payment of
(A) the principal of and interest (including interest accruing during the
pendency of any Insolvency or Liquidation Proceeding, regardless of whether
allowed or allowable in such proceeding) on the loans and other advances
outstanding under the First Priority Debt Agreement, whether at maturity, by
acceleration, upon one or more dates set for prepayment or otherwise, (B) each
payment required to be made by the Company under the First Priority Debt
Agreement in respect of any Letter of Credit, including payments in respect of
reimbursement of disbursements, interest thereon and obligations to provide cash
collateral, and (C) all other monetary obligations of the Company to any of the
First Priority Secured Parties under the First Priority Debt Agreement and each
of the other First Priority Debt Documents, including fees (including any early
termination or prepayment fees), costs, expenses (including fees and expenses of
counsel) and indemnities, whether primary, secondary, direct, contingent, fixed
or otherwise (including monetary obligations incurred during the pendency of any
Insolvency or Liquidation Proceeding, regardless of whether allowed or allowable
in such proceeding), (ii) the due and punctual performance of all other
obligations of the Company under or pursuant to the First Priority Debt
Agreement and each of the other First Priority Debt Documents, and (iii) the due
and punctual payment and performance of all the obligations of each other
Grantor under or pursuant to the First Priority Debt Agreement and each of the
other First Priority Debt Documents.
     “First Priority Collateral” shall mean, collectively, all “Collateral”, as
defined in each of the First Priority Debt Agreement and/or in any other First
Priority Debt Document, including all property of any Grantor now or at any time
hereafter subject to Liens securing any First Priority Claims.
     “First Priority Creditors” shall have the meaning assigned to such term in
the preliminary statement of this Agreement.
     “First Priority Debt Agreement” shall have the meaning assigned to such
term in the preliminary statement of this Agreement.
     “First Priority Debt Documents” shall mean the “Loan Documents” as defined
in the First Priority Debt Agreement.
     “First Priority Liens” shall mean all Liens on the First Priority
Collateral securing the First Priority Claims, whether created under the First
Priority Security Documents or acquired by possession, statute (including any
judgment lien), operation of law, subrogation or otherwise.

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     “First Priority Secured Parties” shall mean, at any time, (a) the First
Priority Creditors, (b) the First Priority Agent, (d) the Issuing Bank, (e) each
other Person to whom any of the First Priority Claims is owed (including any
Affiliate of a First Priority Creditor to whom any First Priority Claims of the
type described in clause (b) of the definition thereof is owed) and (f) the
successors and assigns of each of the foregoing.
     “First Priority Security Agreement” shall have the meaning assigned to such
term in the preliminary statement of this Agreement.
     “First Priority Security Documents” shall mean the First Priority Debt
Agreement, the First Priority Security Agreement and any other agreement,
document or instrument pursuant to which a Lien is granted by any Grantor to
secure any First Priority Claims or under which rights or remedies with respect
to any such Lien are governed.
     “Grantors” shall mean the Company and each of its Subsidiaries that shall
have created or purported to create any First Priority Lien or Second Priority
Lien on all or any part of its assets to secure any First Priority Claims or any
Second Priority Claims, and each other Person that shall have created or
purported to create any First Priority Lien or Second Priority Lien on all or
any part of its assets to secure any First Priority Claims or any Second
Priority Claims.
     “Guarantors” shall mean, collectively, each Grantor that has guaranteed, or
that may from time to time hereafter guarantee, the First Priority Claims or the
Second Priority Claims, whether by executing and delivering the First Priority
Debt Agreement, the First Priority Security Agreement, the Second Priority
Financing Agreement and a supplement thereto or otherwise.
     “Indebtedness” shall mean and includes all obligations that constitute
“Indebtedness” as defined in the First Priority Debt Agreement.
     “Insolvency or Liquidation Proceeding” shall mean (a) any voluntary or
involuntary proceeding under the Bankruptcy Code or any other Bankruptcy Law
with respect to any Grantor, (b) any voluntary or involuntary appointment of a
receiver, trustee, custodian, sequestrator, conservator or similar official for
any Grantor or for a substantial part of the property or assets of any Grantor,
(c) any voluntary or involuntary winding-up or liquidation of any Grantor, or
(d) a general assignment for the benefit of creditors by any Grantor.
     “Issuing Bank” shall mean the “Issuing Lender” as defined in the First
Priority Debt Agreement.
     “Letter of Credit” shall mean a “Letter of Credit” as defined in the First
Priority Debt Agreement.
     “Lien” shall mean, with respect to any asset, (a) any mortgage, deed of
trust, lien, pledge, hypothecation, encumbrance, charge or security interest in,
on or of such asset, (b) the interest of a vendor or a lessor under any
conditional sale agreement, capital lease or title retention agreement (or any
financing lease having substantially the same economic effect as any of the
foregoing) relating to such asset and (c) in the case of securities, any
purchase option, call or similar right of a third Person with respect to such
securities.
     “Liquidation Sale” shall mean a so-called bulk sale, liquidation sale or
“going out of business sale” conducted either by any Secured Party or a Grantor
in respect to all or a substantial portion of such Grantor’s Collateral
following the occurrence and during the continuance of a

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Default or an Event of Default under, and as defined in, either the First
Priority Debt Documents or Second Priority Financing Documents.
     “New First Priority Agent” shall have the meaning assigned to such term in
Section 6.01.
     “New First Priority Claims” shall have the meaning assigned to such term in
Section 6.01.
     “New First Priority Debt Documents” shall have the meaning assigned to such
term in Section 6.01.
     “Pledged or Controlled Collateral” shall have the meaning assigned to such
term in Section 6.04.
     “Refinance” shall mean, in respect of any Indebtedness, to refinance,
extend, renew, restructure (including by the amendment and restatement of any
instrument or agreement evidencing such Indebtedness) or replace or to issue
other Indebtedness in exchange or replacement for, such Indebtedness, in whole
or in part. “Refinanced” and “Refinancing” shall have correlative meanings.
     “Refinancing Notice” shall have the meaning assigned to such term in
Section 6.01.
     “Release” shall have the meaning assigned to such term in Section 3.04.
     “Second Priority Financing Documents” shall mean the Prime Vendor Agreement
and any other agreement, instrument, certificate or other document pursuant to
which any Grantor grants (or purports to grant) a security interest in or a Lien
on any property of any Grantor now or at any time hereafter.
     “Second Priority Claims” shall mean all Indebtedness of the Grantors under
the Second Priority Financing Documents.
     “Second Priority Collateral” shall mean, collectively, all “Collateral”, as
defined in the Prime Vendor Agreement, including all property of any Grantor now
or at any time hereafter subject to Liens securing any Second Priority Claims;
provided, that as of the date hereof, the “Second Priority Collateral” shall,
exclusively, be comprised of all assets of Grantors described in Recital A of
this Agreement, wherever located, now owned or hereafter acquired or arising.
     “Second Priority Creditors” shall mean AmerisourceBergen Drug Corporation,
a Delaware corporation, and its successors and assigns.
     “Second Priority Liens” shall mean all Liens on the Second Priority
Collateral securing the Second Priority Claims created under the Second Priority
Financing Documents or acquired by assignment, and shall not include any
judgment Liens acquired through the exercise by ABDC of any rights or remedies
as an unsecured creditor (except to the extent, and only to the extent, that
such judgment Liens relate to, or are applicable to, the Second Priority
Collateral).
     “Second Priority Permitted Actions” shall have the meaning assigned to such
term in Section 3.01(a).

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     “Second Priority Secured Parties” shall mean, at any time, (a) the Second
Priority Creditors, (b) each other Subsidiary or Affiliate of any Second
Priority Creditor to whom any of the Second Priority Claims (including
indemnification obligations) is owed and (c) the successor and assigns of each
of the foregoing.
     “Secured Parties” shall mean, as the context may require, the First
Priority Secured Parties and/or the Second Priority Secured Parties.
     “Uniform Commercial Code” or “UCC” shall mean the Uniform Commercial Code
(or any similar or equivalent legislation) as in effect from time to time in any
applicable jurisdiction.
          SECTION 1.03. Terms Generally. The definitions of terms herein shall
apply equally to the singular and plural forms of the terms defined. Whenever
the context may require, any pronoun shall include the corresponding masculine,
feminine and neuter forms. The words “include”, “includes” and “including” shall
be deemed to be followed by the phrase “without limitation.” The word “will”
shall be construed to have the same meaning and effect as the word “shall”.
Unless the context requires otherwise (a) any definition of or reference to any
agreement, instrument or other document herein shall be construed as referring
to such agreement, instrument or other document as from time to time amended,
restated, supplemented or otherwise modified, (b) any reference herein (i) to
any Person shall be construed to include such Person’s successors and assigns
and (ii) to the Company or any other Grantor shall be construed to include the
Company or such Grantor as debtor and debtor-in-possession and any receiver or
trustee for the Company or any other Grantor, as the case may be, in any
Insolvency or Liquidation Proceeding or Liquidation Sale, (c) the word
“remedies” shall be construed to refer to all remedies (whether at law, equity
or otherwise, including under contract (including netting, set-off or similar
remedies), statute or regulation or otherwise, (d) the words “herein”, “hereof”
and “hereunder”, and words of similar import, shall be construed to refer to
this Agreement in its entirety and not to any particular provision hereof,
(e) all references herein to Articles or Sections shall be construed to refer to
Articles or Sections of this Agreement and (f) the words “asset” and “property”
shall be construed to have the same meaning and effect and to refer to any and
all tangible and intangible assets and properties, including cash, securities,
accounts and contract rights.
ARTICLE II
Lien Priorities
          SECTION 2.01. Relative Priorities. Notwithstanding the date, manner or
order of grant, attachment or perfection of any Second Priority Lien and any
First Priority Lien, and notwithstanding any provision of the UCC or any other
applicable law or the provisions of any First Priority Debt Agreement, First
Priority Security Agreement or Second Priority Financing Agreement or any other
circumstance whatsoever, the parties hereby agree that so long as the Discharge
of First Priority Claims has not occurred, (i) any First Priority Lien (to the
extent perfected) on any Collateral now or hereafter held by or for the benefit
of any First Priority Secured Party shall be senior in right, priority,
operation, effect and all other respects to any and all Second Priority Liens on
any Collateral, and (ii) any Second Priority Lien on any Collateral now or
hereafter held by or for the benefit of any Second Priority Secured Party shall
be junior and subordinate in right, priority, operation, effect and all other
respects to any and all First Priority Liens (to the extent perfected) on any
Collateral, and the First Priority Liens (to the extent perfected) on any
Collateral shall be and remain senior in right, priority, operation, effect and
all other respects to any Second Priority Liens on any Collateral for all
purposes, whether or

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not any First Priority Liens on any Collateral are subordinated in any respect
to any other Lien held by any Person (other than the Second Priority Secured
Parties) securing any other obligation of the Company, any other Grantor or any
other Person; provided, however, for the avoidance of doubt, nothing herein
contained shall be deemed a subordination in right of payment of the Second
Priority Claims to the First Priority Claims.
          SECTION 2.02. Prohibition on Contesting Liens. ABDC, for itself and on
behalf of the other Second Priority Secured Parties, hereby agrees that it will
not, and hereby waives any right to, contest or support any other Person in
contesting, in any proceeding (including any Insolvency or Liquidation
Proceeding), the priority, validity or enforceability of any First Priority
Lien. First Priority Agent, for itself and on behalf of the other First Priority
Secured Parties, hereby agrees that it will not, and hereby waives any right to,
contest, or support any other Person in contesting, in any proceeding (including
any Insolvency or Liquidation Proceeding) the priority (subject to the terms
hereof governing relative priorities) validity or enforceability of any Second
Priority Lien.
          SECTION 2.03. Common Collateral. The parties hereto acknowledge and
agree that it is their intention that the Second Priority Collateral be included
within the First Priority Collateral and that, without limiting the foregoing,
no portion of the Second Priority Collateral shall not be a part of the First
Priority Collateral. In furtherance of the foregoing, the parties hereto agree
to cooperate in good faith in order to determine, upon any reasonable request by
the First Priority Agent or ABDC, the specific assets included in the First
Priority Collateral and the Second Priority Collateral, the steps taken to
perfect the First Priority Liens and the Second Priority Liens thereon and the
identity of the respective parties obligated under the First Priority Debt
Documents and the Second Priority Financing Documents in respect of the First
Priority Claims and the Second Priority Claims, respectively and, to the extent
that any portion of the Second Priority Collateral is not included within the
First Priority Collateral at any time, without limiting any other right or
remedy available to the First Priority Agent or the other First Priority Secured
Parties, ABDC, for itself and on behalf of the other Second Priority Secured
Parties, agrees that any amounts received by or distributed to any Second
Priority Secured Party pursuant to or as a result of any Lien in such Second
Priority Collateral shall be subject to Section 4.02. In addition, in
furtherance of the foregoing, without the prior written consent of the First
Security Priority Agent, no Second Priority Financing Document may be amended,
supplemented or otherwise modified, or entered into, to the extent such
amendment, supplement or modification, or the terms of such new Second Priority
Financing Document, would (i) contravene the provisions of this Agreement or
(ii) increase, expand or otherwise add to the Second Priority Collateral.
ARTICLE III
Enforcement of Rights; Matters Relating to Collateral
          SECTION 3.01. Exercise of Rights and Remedies.  (a) So long as the
Discharge of First Priority Claims has not occurred, whether or not any
Insolvency or Liquidation Proceeding or Liquidation Sale has been commenced, the
First Priority Agent and the other First Priority Secured Parties shall have the
exclusive right to enforce rights and exercise remedies with respect to the
Collateral (including making determinations regarding the release, Disposition
or restrictions with respect to the Collateral), or to commence or seek to
commence any action or proceeding with respect to such rights or remedies
(including any foreclosure action or proceeding or any Insolvency or Liquidation
Proceeding or Liquidation Sale), in each case,

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without any consultation with or the consent of any Second Priority Secured
Party except as required pursuant to applicable law; provided that,
notwithstanding the foregoing, (i) in any Insolvency or Liquidation Proceeding,
the Second Priority Secured Parties may file a proof of claim or statement of
interest with respect to the Second Priority Claims; (ii) the Second Priority
Secured Parties may take any action to preserve or protect the validity and
enforceability of the Second Priority Liens, provided that no such action is, or
could reasonably be expected to be, (A) materially adverse to the First Priority
Liens or the rights of the First Priority Secured Parties as secured creditors
or any other First Priority Secured Party to exercise remedies as secured
creditors in respect thereof or (B) otherwise inconsistent with the terms of
this Agreement, including the automatic release of Second Priority Liens
provided in Section 3.04; (iii) the Second Priority Secured Parties may file any
responsive or defensive pleadings in opposition to any motion, claim, adversary
proceeding or other pleading made by any Person objecting to or otherwise
seeking the disallowance of the claims of the Second Priority Secured Parties,
including any claims secured by the Collateral or otherwise make any agreements
or file any motions pertaining to the Second Priority Claims, in each case, to
the extent not inconsistent with the terms of this Agreement; (iv) the Second
Priority Secured Parties may exercise rights and remedies as unsecured
creditors, as provided in Section 3.03(a); and (v) subject to Section 3.02(a),
the Second Priority Agent and the other Second Priority Secured Parties may
enforce any of their rights and exercise any of their remedies with respect to
the Collateral after the termination of the Standstill Period (the actions
described in this proviso being referred to herein as the “Second Priority
Permitted Actions”). Except for the Second Priority Permitted Actions, unless
and until the Discharge of First Priority Claims has occurred, the sole right of
the Second Priority Secured Parties with respect to the Collateral shall be to
receive the proceeds of the Collateral, if any, remaining after the Discharge of
First Priority Claims has occurred and in accordance with the Second Priority
Financing Documents and applicable law.
          (b) In exercising rights and remedies with respect to the Collateral,
subject to applicable law (including all provisions of the UCC applicable
thereto), the First Priority Agent and the other First Priority Secured Parties
may enforce the provisions of the First Priority Debt Documents and exercise
remedies thereunder, all in such order, without notice (except as required by
applicable law (including all provisions of the UCC applicable thereto)) to any
Second Priority Secured Creditor and in such manner as they may determine in
their sole discretion (provided that, without limiting the foregoing, the First
Priority Agent shall use its commercially reasonable efforts to provide ABDC
with subsequent notice thereof). Such exercise and enforcement shall include the
rights of an agent appointed by them to Dispose of Collateral upon foreclosure,
to incur expenses in connection with any such Disposition and to exercise all
the rights and remedies of a secured creditor under and in accordance with the
Uniform Commercial Code, the Bankruptcy Code or any other Bankruptcy Law.
          (c) In exercising rights and remedies with respect to the Collateral,
the Second Priority Secured Parties may enforce the provisions of the Second
Priority Financing Documents and exercise remedies thereunder, all in such order
and in such manner as they may determine in their sole discretion, in each case,
to the extent that such enforcement or exercise is not otherwise prohibited by
clauses (a) through (c) of this Section 3.01. Such exercise and enforcement
shall, in each case, to the extent that such enforcement or exercise is not
otherwise prohibited by clauses (a) through (c) of this Section 3.01, include
the rights of an agent appointed by them to Dispose of Collateral upon
foreclosure, to incur expenses in connection with any such Disposition and to
exercise all the rights and remedies of a secured creditor under the Uniform
Commercial Code, the Bankruptcy Code or any other Bankruptcy Law. ABDC agrees to
provide at least 5 Business Days’ prior written notice to the First Priority
Agent of its intention to

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foreclose upon or Dispose of any Collateral; provided, however, that the failure
to give any such notice shall not in any way limit its ability to foreclose upon
or Dispose of any Collateral to the extent that such foreclosure is not
otherwise prohibited by clauses (a) through (d) of this Section 3.01.
          SECTION 3.02. No Interference. ABDC, for itself and on behalf of the
other Second Priority Secured Parties, agrees that, whether or not any
Insolvency or Liquidation Proceeding or Liquidation Sale has been commenced, the
Second Priority Secured Parties:
          (a) except for Second Priority Permitted Actions, will not, so long as
the Discharge of First Priority Claims has not occurred, (A) enforce or
exercise, or seek to enforce or exercise, any rights or remedies with respect to
any Collateral (including the enforcement of any right under any account control
agreement, landlord waiver or bailee’s letter or any similar agreement or
arrangement to which any Second Priority Secured Party is a party) or
(B) commence or join with any Person (other than the First Priority Agent) in
commencing, or petition for or vote in favor of any resolution for, any action
or proceeding with respect to such rights or remedies (including any foreclosure
action); provided, however, that none of the Second Priority Secured Parties may
enforce or exercise any or all such rights and remedies, or commence, join with
any Person in commencing, or petition for or vote in favor of any resolution
for, any such action or proceeding, after a period of 90 days has elapsed (which
period shall be tolled during any period in which the First Priority Agent shall
not be entitled to enforce or exercise any rights or remedies with respect to
any Collateral as a result of (x) any injunction issued by a court of competent
jurisdiction or (y) the automatic stay or any other stay in any Insolvency or
Liquidation Proceeding) since the date on which ABDC has delivered to the First
Priority Agent written notice of an uncured default under the Prime Vending
Agreement (the “Standstill Period”); provided further, however, that
(1) notwithstanding the expiration of the Standstill Period or anything herein
to the contrary, in no event shall ABDC or any other Second Priority Secured
Party enforce or exercise any rights or remedies with respect to any Collateral,
or commence, join with any Person at any time in commencing, or petition for or
vote in favor of any resolution for, any such action or proceeding, if the First
Priority Agent or any other First Priority Secured Party shall have commenced,
and shall be diligently pursuing (or shall have sought or requested relief from
or modification of the automatic stay or any other stay in any Insolvency or
Liquidation Proceeding to enable the commencement and pursuit thereof), the
enforcement or exercise of any rights or remedies with respect to any Collateral
or any such action or proceeding (prompt written notice thereof to be given to
the Second Priority Agent by the First Priority Agent) and (2) after the
expiration of the Standstill Period, so long as neither the First Priority Agent
nor the First Priority Secured Parties have commenced any action to enforce
their Lien on any material portion of the Collateral, in the event that and for
so long as the Second Priority Secured Parties (or ABDC on their behalf) have
commenced any actions to enforce their Lien with respect to any Collateral to
the extent permitted hereunder and are diligently pursuing such actions, neither
the First Priority Secured Parties nor the First Priority Agent shall take any
action of a similar nature with respect to such Collateral; provided that all
other provisions of this Agreement (including the turnover provisions of
Article IV) are complied with;
          (b) will not contest, protest or object to any foreclosure action or
proceeding brought by the First Priority Agent or any other First Priority
Secured Party, or any other enforcement or exercise by any First Priority
Secured Party of any rights or remedies relating to the Collateral under the
First Priority Debt Documents or an Insolvency or Liquidation Proceeding or in
connection with a Liquidation Sale or otherwise, so long as Second Priority
Liens attach to the proceeds thereof subject to the relative priorities set
forth in Section 2.01(a),

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and will not contest, protest or object to the forbearance by the First Priority
Agent or any other First Priority Secured Party from commencing or pursuing any
foreclosure action or proceeding or any other enforcement or exercise of any
rights or remedies with respect to the Collateral.
In furtherance of the foregoing, ABDC, for itself and on behalf of the other
Second Priority Secured Parties, agrees that, whether or not any Insolvency or
Liquidation Proceeding or Liquidation Sale has been commenced, the Second
Priority Secured Parties will not, except for Second Priority Permitted Actions,
(w) take or receive any Collateral, or any proceeds thereof or payment with
respect thereto, in connection with the exercise of any right or enforcement of
any remedy with respect to any Collateral or in connection with any insurance
policy award under a policy of insurance relating to any Collateral or any
condemnation award (or deed in lieu of condemnation) relating to any Collateral,
(x) take any action that would, or could reasonably be expected to, hinder, in
any manner, any exercise of remedies under the First Priority Debt Documents,
including any Disposition of any Collateral, whether by foreclosure or otherwise
and (y) object to the manner in which the First Priority Agent or any other
First Priority Secured Party may seek to enforce or collect the First Priority
Claims or the First Priority Liens, regardless of whether any action or failure
to act by or on behalf of the First Priority Agent or any other First Priority
Secured Party is, or could be, adverse to the interests of the Second Priority
Secured Parties, and will not assert, and hereby waive, to the fullest extent
permitted by law, any right to demand, request, plead or otherwise assert or
claim the benefit of any marshalling, appraisal, valuation or other similar
right that may be available under applicable law with respect to the Collateral
or any similar rights a junior secured creditor may have under applicable law,
and (z) will not attempt, directly or indirectly, whether by judicial proceeding
or otherwise, to challenge or question the validity or enforceability of any
First Priority Claim or any First Priority Security Document, including this
Agreement, or the validity or enforceability of the priorities, rights or
obligations established by this Agreement.
          SECTION 3.03. Rights as Unsecured Creditors. The Second Priority
Secured Parties may, in accordance with the terms of the Second Priority
Financing Documents and applicable law, enforce rights and exercise remedies
against any Grantor as unsecured creditors; provided that no such action is
otherwise inconsistent with the terms of this Agreement. Without limiting the
generality of the foregoing sentence, the Second Priority Secured Parties shall
be entitled to prosecute litigation against any Grantor or any other Person
liable in respect of the Second Priority Claims but shall be prohibited from
taking any action to enforce any judgment relating to, or applicable to, any of
the Second Priority Collateral until the Discharge of the First Priority Claims.
Nothing in this Agreement shall prohibit the receipt by any Second Priority
Secured Party of the required payments of any amounts due under the Second
Priority Financing Documents so long as such receipt is not the direct or
indirect result of the enforcement of Second Priority Liens or exercise in
contravention of this Agreement by any Second Priority Secured Party of rights
or remedies as a secured creditor against Collateral or enforcement in
contravention of this Agreement of any Second Priority Lien against Collateral
(including any judgment lien resulting from the exercise of remedies available
to an unsecured creditor to the extent relating to, or applicable to, any of the
Second Priority Collateral).
          SECTION 3.04. Automatic Release of Second Priority Liens. If, in
connection with (i) any Disposition of any Collateral permitted under the terms
of the First Priority Debt Documents or (ii) the enforcement or exercise of any
rights or remedies with respect to the Collateral, including any Disposition of
Collateral, the First Priority Agent, for itself and on behalf of the other
First Priority Secured Parties, (x) releases any of the First Priority Liens, or
(y) releases any Guarantor from its obligations under its guarantee of the First
Priority

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Claims (in each case, a “Release”), other than any such Release granted
following (and not as a condition to) the Discharge of First Priority Claims,
then the Second Priority Liens on such Collateral (to the extent, and only to
the extent, subject to the release pursuant to preceding clause (x)), and the
obligations of such Guarantor under its guarantee of the Second Priority Claims
(to the extent, and only to the extent, to the release of the applicable
Guarantor pursuant to preceding clause (y)), shall be automatically,
unconditionally and simultaneously released (subject to the receipt by the First
Priority Agent of any applicable cash proceeds of any such Disposition or sums
realized in enforcement or exercise of any rights or remedies with respect to
the Second Priority Collateral and the application thereof in accordance with
the terms of this Agreement), and ABDC shall, for itself and on behalf of the
other Second Priority Secured Parties, promptly execute and deliver to the First
Priority Agent, the relevant Grantor or such Guarantor such termination
statements, releases and other documents as the First Priority Agent or the
relevant Grantor or Guarantor may reasonably request and provide to effectively
confirm such Release. For the avoidance of doubt, all proceeds of any
Disposition of Collateral or other enforcement or exercise of any rights or
remedies with respect to the Collateral received by any Secured Party shall be
subject the to application of proceeds requirements of Section 4.01 and, until
application in accordance therewith, each Secured Party agrees, subject to
applicable law, to hold the same in express trust for such Secured Party (or
Secured Parties) as are entitled thereto in accordance with the terms hereof.
Until the Discharge of First Priority Claims occurs, any ABDC, for itself and on
behalf of any other Second Priority Secured Party, hereby appoints the First
Priority Agent, and any officer or agent of the First Priority Agent, with full
power of substitution, as the attorney-in-fact of each Second Priority Secured
Party for the purpose of carrying out the provisions of this Section 3.04 and
taking any action and executing any instrument that the First Priority Agent may
deem necessary or advisable to accomplish the purposes of this Section 3.04
(including any endorsements or other instruments of transfer or release), which
appointment is irrevocable and coupled with an interest.
          SECTION 3.05. Insurance and Condemnation Awards. So long as the
Discharge of First Priority Claims has not occurred, the First Priority Agent
and the other First Priority Secured Parties shall have the exclusive right,
subject to the rights of the Grantors under the First Priority Debt Documents,
to settle and adjust claims in respect of Collateral under policies of insurance
covering Collateral and to approve any award granted in any condemnation or
similar proceeding, or any deed in lieu of condemnation, in respect of the
Collateral, provided that all the other provisions of this Agreement are
complied with in regard thereto. All proceeds of any such policy and any such
award, or any payments with respect to a deed in lieu of condemnation, shall
(a) first, prior to the Discharge of First Priority Claims and subject to the
rights of the Grantors under the First Priority Debt Documents, be paid to the
First Priority Agent for the benefit of First Priority Secured Parties pursuant
to the terms of the First Priority Debt Documents, (b) second, after the
Discharge of First Priority Claims and subject to the rights of the Grantors
under the Second Priority Financing Documents, be paid to the Second Priority
Secured Parties pursuant to the terms of the Second Priority Financing
Documents, and (c) third, be paid to the owner of the subject property or as a
court of competent jurisdiction may otherwise direct. Until the Discharge of
First Priority Claims has occurred, if any Second Priority Secured Party shall,
at any time, receive any proceeds of any such insurance policy or any such award
or payment, it shall transfer and pay over such proceeds to the First Priority
Agent in accordance with Section 4.02.
          SECTION 3.06. Notification of Release of Collateral. Each of the First
Priority Agent and ABDC shall give the other prompt written notice of the
Disposition by it of, and Release by it of the Lien on, any Collateral. Such
notice shall describe in reasonable detail the subject Collateral, the parties
involved in such Disposition or Release, the place, time manner

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and method thereof, and the consideration, if any, received therefor; provided,
however, that the failure to give any such notice shall not in and of itself in
any way impair the effectiveness of any such Disposition or Release.
ARTICLE IV
Payments
          SECTION 4.01. Application of Proceeds. Any Collateral or proceeds
thereof received by any Secured Party in connection with any Disposition of, or
collection on, such Collateral upon the enforcement or exercise of any right or
remedy shall be applied as follows:
     first, to the payment in full of the First Priority Claims and the costs
and reasonable out-of-pocket expenses of the First Priority Agent in connection
with such enforcement or exercise, and
     second, after all such costs and expenses have been paid in full and the
Discharge of First Priority Claims has occurred, to the payment of the Second
Priority Claims.
After all such costs and expenses have been paid in full, the Discharge of First
Priority Claims has occurred and the Discharge of Second Priority Claims has
occurred, any surplus Collateral or proceeds then remaining shall be returned to
the applicable Grantor or to whosoever may be lawfully entitled to receive the
same or as a court of competent jurisdiction may direct.
          SECTION 4.02. Payment Over. So long as the Discharge of First Priority
Claims has not occurred, any Collateral or any proceeds thereof (together with
assets or proceeds subject to Liens referred to in the final sentence of
Section 2.03) received by any Second Priority Secured Party in connection with
any Disposition of, or collection on, such Collateral upon the enforcement or
the exercise of any right or remedy with respect to the Collateral, or in
connection with any insurance policy claim or any condemnation award (or deed in
lieu of condemnation), shall be segregated and held in trust and forthwith
transferred or paid over to the First Priority Agent for the benefit of the
First Priority Secured Parties in the same form as received, together with any
necessary endorsements, or as a court of competent jurisdiction may otherwise
direct. Until the Discharge of First Priority Claims occurs, ABDC, for itself
and on behalf of each other Second Priority Secured Party, hereby appoints the
First Priority Agent, and any officer or agent of the First Priority Agent, with
full power of substitution, the attorney-in-fact of each Second Priority Secured
Party for the purpose of carrying out the provisions of this Section 4.02 and
taking any action and executing any instrument that the First Priority Agent may
deem necessary or advisable to accomplish the purposes of this Section 4.02,
which appointment is irrevocable and coupled with an interest. Nothing herein
contained shall be deemed to prohibit any Second Priority Secured Party from
receiving and retaining the purchase price paid to such Second Priority Secured
Party in the ordinary course of business for Goods sold to any Grantor in the
ordinary course of business.

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ARTICLE V
Insolvency or Liquidation Proceedings
          SECTION 5.01. Bankruptcy Finance and Section 363 Matters.  (a) In
furtherance of this Agreement, until the Discharge of First Priority Claims has
occurred, the ABDC, on behalf of itself and each of the Second Priority Secured
Parties, agrees that, in the event of any Insolvency or Liquidation Proceeding,
the Second Priority Secured Parties: (i) will not oppose or object to the use of
any Collateral constituting cash collateral under Section 363 of the Bankruptcy
Code, or any comparable provision of any other Bankruptcy Law, unless the First
Priority Secured Parties, or a representative authorized by the First Priority
Secured Parties, shall oppose or object to such use of cash collateral; (ii)
(A) will not oppose or object to any post-petition financing provided to any
Grantor, whether provided by the First Priority Secured Parties or any other
Person, under Section 364 of the Bankruptcy Code, or any comparable provision of
any other Bankruptcy Law (a “DIP Financing”), or the Liens securing any DIP
Financing (“DIP Financing Liens”), unless the First Priority Secured Parties, or
a representative authorized by the First Priority Secured Parties, shall then
oppose or object to such DIP Financing or such DIP Financing Liens, (B) to the
extent that (x) such DIP Financing Liens are senior to, or rank pari passu with,
the First Priority Liens on the Collateral, and/or (y) the First Priority Claims
are included as obligations under such DIP Financing or are repaid with proceeds
of the DIP Financing, the Second Priority Secured Parties will subordinate the
Second Priority Liens on the Collateral to the First Priority Liens on the
Collateral, if applicable, and the DIP Financing Liens (including if the First
Priority Claims are (x) included as obligations under such DIP Financing and/or
(y) are repaid with proceeds of the DIP Financing) on the terms of this
Agreement; and (C) will not propose or support any DIP Financing to any Grantor;
(iii) not propose, vote in favor of, or otherwise support any plan of
reorganization that is inconsistent with the priorities or other provisions of
this Agreement; (iv) except to the extent permitted by paragraph (b) of this
Section 5.01, in connection with the use of cash collateral as described in
clause (i) above or a DIP Financing, will not request adequate protection with
respect to any Collateral or any other relief in connection with such use of
cash collateral, DIP Financing or DIP Financing Liens; and (v) will not oppose
or object to any Disposition of any Collateral free and clear of the Second
Priority Liens or other claims under Section 363 of the Bankruptcy Code, or any
comparable provision of any other Bankruptcy Law, if the First Priority Secured
Parties, or a representative authorized by the First Priority Secured Parties,
shall consent to such Disposition.
          (b) The Second Secured Parties agree that they shall not, and shall
not support any other Person in contesting, (i) any request by the First
Priority Agent or any other First Priority Secured Party for adequate protection
in respect of any First Priority Claims or (ii) any objection, based on a claim
of a lack of adequate protection with respect of any First Priority Claims, by
the First Priority Agent or any other First Priority Secured Party to any
motion, relief, action or proceeding.
          SECTION 5.02. Additional Bankruptcy Matters. The Second Priority
Secured Parties agree that, so long as the Discharge of First Priority Claims
has not occurred, no Second Priority Secured Party shall, without the prior
written consent of the First Priority Agent, seek or request relief from or
modification of the automatic stay or any other stay in any Insolvency or
Liquidation Proceeding in respect of any part of the Collateral, any proceeds
thereof or any Second Priority Lien on the Collateral. If, in any Insolvency or
Liquidation Proceeding, debt obligations of the reorganized debtor secured by
Liens upon any property of the reorganized debtor are distributed, pursuant to a
plan of reorganization or similar dispositive

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restructuring plan, on account of the First Priority Claims and the Second
Priority Claims, then, to the extent the debt obligations distributed on account
of the First Priority Claims and on account of the Second Priority Claims are
secured by Liens upon the same assets or property, the provisions of this
Agreement will survive the distribution of such debt obligations pursuant to
such plan and will apply with like effect to the Liens securing such debt
obligations. In addition, ABDC, for itself and on behalf of the other Second
Priority Secured Parties, (x) agrees that no Second Priority Secured Party shall
oppose or seek to challenge any claim by the First Priority Agent or any other
First Priority Secured Party for allowance in any Insolvency or Liquidation
Proceeding of First Priority Claims consisting of post-petition interest, fees
or expenses to the extent of the value of the First Priority Liens (it being
understood and agreed that such value shall be determined without regard to the
existence of the Second Priority Liens on the Collateral), (y) waives any claim
any Second Priority Secured Party may hereafter have against any First Priority
Secured Party arising out of (a) the election by any First Priority Secured
Party of the application of Section 1111(b)(2) of the Bankruptcy Code, or any
comparable provision of any other Bankruptcy Law, or (b) any use of cash
collateral or financing arrangement, or any grant of a security interest in the
Collateral, in any Insolvency or Liquidation Proceeding and (z) agrees that,
without the written consent of First Priority Agent, it will not seek to vote
with the First Priority Agent (or any other First Priority Secured Party) as a
single class in connection with any plan of reorganization in any Insolvency or
Liquidation Proceeding. In addition, other than with respect to the Second
Priority Permitted Actions, nothing contained herein shall prohibit or in any
way limit the First Priority Agent or any other First Priority Secured Party
from opposing, challenging or objecting to, in any Insolvency or Liquidation
Proceeding or otherwise, any action taken, or any claim made, by any Second
Priority Secured Party with respect to the Collateral, including any request by
any Second Priority Secured Party for adequate protection or any exercise by any
Second Priority Secured Party of any of its rights and remedies under the Second
Priority Financing Documents with respect to the Collateral or otherwise with
respect to the Collateral.
ARTICLE VI
Other Agreements
          SECTION 6.01. Effect of Refinancing of Indebtedness under First
Priority Debt Documents. If, substantially contemporaneously with the Discharge
of First Priority Claims, the Grantors Refinance Indebtedness outstanding under
the First Priority Debt Documents and provided that the Company or the First
Priority Agent gives to ABDC or any of the other Second Priority Secured Parties
written notice (the “Refinancing Notice”) electing the application of the
provisions of this Section 6.01 to such Refinancing Indebtedness, then (i) such
Discharge of First Priority Claims shall automatically be deemed not to have
occurred for all purposes of this Agreement, (ii) such Refinancing Indebtedness
and all other obligations under the documents evidencing such Indebtedness
(provided that the aggregate principal committed amount thereof shall not exceed
$150,000,000) (the “New First Priority Claims”) shall automatically be treated
as First Priority Claims for all purposes of this Agreement, including for
purposes of the Lien priorities and rights in respect of Collateral set forth
herein, (iii) the Debt Agreement and the other documents evidencing such
Refinancing Indebtedness (the “New First Priority Debt Documents”) shall
automatically be treated as the First Priority Debt Agreement and the First
Priority Debt Documents and, in the case of New First Priority Debt Documents
that are security documents pursuant to which any Grantor has granted a Lien to
secure any New First Priority Claim, as the First Priority Security Documents
for all purposes of this Agreement, (iv) the collateral agent under the New
First Priority Debt Documents (the “New First Priority Agent”) shall be deemed
to be the First Priority Agent for all purposes of this Agreement and (v)

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the lenders and other creditors under the New First Priority Debt Documents
shall be deemed to be the First Priority Creditors for all purposes of this
Agreement. Upon receipt of a Refinancing Notice, which notice shall include the
identity of the New First Priority Agent, the Second Priority Secured Parties
shall promptly enter into such documents and agreements (including amendments or
supplements to this Agreement) as the Company or such New First Priority Agent
may reasonably request in order to provide to the New First Priority Agent the
rights and powers contemplated hereby, in each case consistent in all material
respects with the terms of this Agreement. The Company shall cause the
agreement, document or instrument pursuant to which the New First Priority Agent
is appointed to provide that the New First Priority Agent agrees to be bound by
the terms of this Agreement.
          SECTION 6.02. Reinstatement. If, in any Insolvency or Liquidation
Proceeding or otherwise, all or part of any payment with respect to the First
Priority Claims previously made shall be rescinded for any reason whatsoever,
then the First Priority Claims shall be reinstated to the extent of the amount
so rescinded and, if theretofore terminated, this Agreement shall be reinstated
in full force and effect and such prior termination shall not diminish, release,
discharge, impair or otherwise affect the Lien priorities and the relative
rights and obligations of the First Priority Secured Parties and the Second
Priority Secured Parties provided for herein.
          SECTION 6.03. Authorization of First Priority Collateral Agent and
ABDC. By accepting the benefits of this Agreement and the other First Priority
Security Documents, each First Priority Secured Party hereby authorizes the
First Priority Agent to enter into this Agreement and to act on its behalf as
collateral agent hereunder and in connection herewith. By accepting the benefits
of this Agreement and the other Second Priority Financing Documents, each Second
Priority Secured Party authorizes ABDC to enter into this agreement and to act
on its behalf as agent hereunder and in connection therewith.
          SECTION 6.04. Bailment for Perfection of Certain Security Interests.
The First Priority Agent agrees that if it shall at any time hold a First
Priority Lien on any Collateral that can be perfected or the priority of which
can be enhanced by the possession or control of such Collateral or of any
account in which such Collateral is held, and if such Collateral or any such
account is in fact in the possession or under the control of the First Priority
Agent, or of agents or bailees of the First Priority Agent (such Collateral
being referred to herein as the “Pledged or Controlled Collateral”), the First
Priority Agent shall, solely for the purpose of perfecting the Second Priority
Liens granted under the Second Priority Financing Documents and subject to the
terms and conditions of this Section 6.04, also (i) hold and/or maintain control
of such Pledged or Controlled Collateral as gratuitous bailee for and
representative (as defined in Section 1-201(35) of the Uniform Commercial Code
as in effect in the State of New York) of, or as agent for, the Second Priority
Secured Parties, (ii) with respect to any securities accounts included in the
Collateral, have “control” (within the meaning of Section 8-106(d)(3) of the
UCC) of such securities accounts on behalf of the Second Priority Secured
Parties and (iii) with respect to any deposit accounts included in the
Collateral, act as agent for the Second Priority Secured Parties and any
assignee. So long as the Discharge of First Priority Claims has not occurred,
the First Priority Agent shall be entitled to deal with the Pledged or
Controlled Collateral in accordance with the terms of this Agreement and the
other First Priority Debt Documents as if the Second Priority Liens did not
exist. The obligations and responsibilities of the First Priority Agent to the
Second Priority Secured Parties under this Section 6.04 shall be limited solely
to holding or controlling the Pledged or Controlled Collateral as gratuitous
bailee and representative (as defined in Section 1-201(35) of the Uniform
Commercial Code as in effect in the State of New York) in accordance with this
Section 6.04. Without limiting the foregoing, the First

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Priority Agent shall have no obligation or responsibility to ensure that any
Pledged or Controlled Collateral is genuine or owned by any of the Grantors. The
First Priority Agent acting pursuant to this Section 6.04 shall not, by reason
of this Agreement, any other Security Document or any other document, have a
fiduciary relationship in respect of any other First Priority Secured Party or
any Second Priority Secured Party. Upon the Discharge of First Priority Claims,
the First Priority Agent shall transfer the possession and control of the
Pledged or Controlled Collateral, together with any necessary endorsements but
without recourse or warranty, (i) if the Second Priority Claims are outstanding
at such time, to the Second Priority Secured Parties, if no Second Priority
Claims are outstanding at such time, to the applicable Grantor, in each case so
as to allow such Person to obtain possession and control of such Pledged or
Controlled Collateral. In connection with any transfer under clause (i) of the
immediately preceding sentence, the First Priority Agent agrees, at the expense
of the Grantors, to take all actions in its power as shall be reasonably
requested by the Second Priority Secured Parties to obtain a first priority
security interest in the Pledged or Controlled Collateral.
          SECTION 6.05. Further Assurances. Each of the First Priority Agent,
for itself and on behalf of the other First Priority Secured Parties and the
Second Priority Secured Parties, and each Grantor party hereto, for itself and
on behalf of its subsidiaries, agrees that it will execute, or will cause to be
executed, any and all further documents, agreements and instruments, and take
all such further actions, as may be required under any applicable law, or which
the First Priority Agent or the Second Priority Secured Parties may reasonably
request, to effectuate the terms of this Agreement, including the relative Lien
priorities provided for herein.
ARTICLE VII
Representations and Warranties
          SECTION 7.01. Representations and Warranties of Each Party. Each party
hereto represents and warrants to the other parties hereto as follows:
          (a) such party is duly organized, validly existing and in good
standing under the laws of the jurisdiction of its organization and has all
requisite power and authority to execute and deliver this Agreement and perform
its obligations hereunder.
          (b) this Agreement has been duly executed and delivered by such party
and constitutes a legal, valid and binding obligation of such party, enforceable
in accordance with its terms.
          (c) the execution, delivery and performance by such party of this
Agreement (i) do not require any consent or approval of, registration or filing
with or any other action by any governmental authority (except as contemplated
hereby) and (ii) will not violate any provision of law, statute, rule or
regulation, or of the certificate or articles of incorporation or other
constitutive documents or by-laws of such party or any order of any governmental
authority or any provision of any indenture, agreement or other instrument
applicable to or binding upon such party.
          SECTION 7.02. Representations and Warranties of Each of the First
Priority Agent and ABDC. Each of the First Priority Agent and ABDC represents
and warrants to the other parties hereto that it has been duly authorized in
writing by the First Priority Secured Parties or Second Priority Secured
Parties, as the case may be, to enter into this Agreement.

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ARTICLE VIII
No Reliance; No Liability; Obligations Absolute
          SECTION 8.01. No Reliance; Information. The First Priority Secured
Parties and the Second Priority Secured Parties shall have no duty to disclose
to any Second Priority Secured Party or to any First Priority Secured Party,
respectively, any information relating to the Company or any of the Grantors, or
any other circumstance bearing upon the risk of nonpayment of any of the First
Priority Claims or the Second Priority Claims, as the case may be, that is known
or becomes known to any of them or any of their Affiliates. In the event any
First Priority Secured Party or any Second Priority Secured Party, in its sole
discretion, undertakes at any time or from time to time to provide any such
information to, respectively, any Second Priority Secured Party or any First
Priority Secured Party, it shall be under no obligation (i) to make, and shall
not make or be deemed to have made, any express or implied representation or
warranty, including with respect to the accuracy, completeness, truthfulness or
validity of the information so provided, (ii) to provide any additional
information or to provide any such information on any subsequent occasion or
(iii) to undertake any investigation.
          SECTION 8.02. No Warranties or Liability.  (a) The First Priority
Agent, for itself and on behalf of the other First Priority Secured Parties,
acknowledges and agrees that, except for the representations and warranties set
forth in Article VII, no Second Priority Secured Party has made any express or
implied representation or warranty, including with respect to the execution,
validity, legality, completeness, collectability or enforceability of any of the
Second Priority Financing Documents, the ownership of any Collateral or the
perfection or priority of any Liens thereon. ABDC, for itself and on behalf of
the other Second Priority Secured Parties, acknowledges and agrees that, except
for the representations and warranties set forth in Article VII, neither the
First Priority Agent nor any other First Priority Secured Party has made any
express or implied representation or warranty, including with respect to the
execution, validity, legality, completeness, collectability or enforceability of
any of the First Priority Debt Documents, the ownership of any Collateral or the
perfection or priority of any Liens thereon.
          (b) The Second Priority Secured Parties shall have no express or
implied duty to the First Priority Agent or any other First Priority Secured
Party, and the First Priority Agent and the other First Priority Secured Parties
shall have no express or implied duty to the Second Priority Secured Parties to
act or refrain from acting in a manner which allows, or results in, the
occurrence or continuance of a default or an event of default under any First
Priority Debt Document and any Second Priority Financing Document (other than,
in each case, this Agreement), regardless of any knowledge thereof which they
may have or be charged with.
          (c) ABDC, for itself and on behalf of the other Second Priority
Secured Parties, agrees that no First Priority Secured Party shall have any
liability to the Second Priority Secured Parties and hereby waive any claim
against any First Priority Secured Party, arising out of any and all actions
which the First Priority Agent or the other First Priority Secured Parties may
take or permit or omit to take with respect to (i) the First Priority Debt
Documents (other than this Agreement), (ii) the collection of the First Priority
Claims or (iii) the maintenance of, the preservation of, the foreclosure upon or
the Disposition of any Collateral.

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ARTICLE IX
Miscellaneous
          SECTION 9.01. Notices. Notices and other communications provided for
herein shall be in writing in the English language (or accompanied by a
certified translation) and shall be delivered by hand or overnight courier
service, mailed by certified or registered mail or sent by fax, as follows:
if to the First Priority Agent:
Jefferies Finance LLC
520 Madison Avenue
New York, New York 10022
Attention: General Counsel — Investment Banking
Facsimile No.: (212) 284-3444
with a copy to:
Proskauer Rose LLP
1585 Broadway
New York, New York 10036
Attention: Joshua W. Thompson
Facsimile No.: (212) 969-2900
if to ABDC or any of the Second Priority Secured Parties;
AmerisourceBergen Drug Corporation
1300 Morris Drive
Chesterbrook, PA 19087-5594
Attention: Group Vice President, Alternate Care
Facsimile No.: (610) 727-3601
with a copy to:
AmerisourceBergen Corporation
1300 Morris Drive
Chesterbrook, Pennsylvania 19087-5594
Attention: General Counsel
Facsimile No.: (610) 727-3612
          All notices and other communications given to any party hereto in
accordance with the provisions of this Agreement shall be deemed to have been
given on the date of receipt if delivered by hand or overnight courier service
or sent by fax or on the date five Business Days after dispatch by certified or
registered mail if mailed, in each case delivered, sent or mailed (properly
addressed) to such party as provided in this Section 9.01 or in accordance with
the latest unrevoked direction from such party given in accordance with this
Section 9.01. As agreed to between the Company and any Collateral Agent from
time to time, notices and other communications may also be delivered by e-mail
to the e-mail address of a representative of the applicable Person provided from
time to time by such Person. In addition, ABDC agrees to use

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diligent efforts to provide any notices of default or acceleration or similar
notices which they give to any Grantor under any Second Priority Financing
Documents.
          SECTION 9.02. Conflicts. IN THE EVENT OF ANY CONFLICT OR INCONSISTENCY
BETWEEN THE PROVISIONS OF THIS AGREEMENT AND THE PROVISIONS OF THE OTHER DEBT
DOCUMENTS, THE PROVISIONS OF THIS AGREEMENT SHALL CONTROL.
          SECTION 9.03. Effectiveness; Survival; Termination. This Agreement
shall become effective when executed and delivered by the parties hereto. All
covenants, agreements, representations and warranties made by any party in this
Agreement shall be considered to have been relied upon by the other parties
hereto and shall survive the execution and delivery of this Agreement. The terms
of this Agreement shall survive, and shall continue in full force and effect, in
any Insolvency or Liquidation Proceeding. ABDC, for itself and on behalf of the
other Second Priority Secured Parties, hereby waive any and all rights the
Second Priority Secured Parties may now or hereafter have under applicable law
to revoke this Agreement or any of the provisions of this Agreement. This
Agreement shall terminate and be of no further force and effect, (i) subject to
compliance with its obligations to take certain actions upon Discharge of the
Second Priority Claims pursuant to Article V and Section 3.01(d), with respect
to the Second Priority Secured Parties and the Second Priority Claims, upon the
later of (1) the date upon which the obligations under the Second Priority
Financing Documents terminate if there are no other Second Priority Claims
outstanding on such date and (2) if there are other Second Priority Claims
outstanding on such date, the date upon which such Second Priority Claims
terminate, subject to the rights of the Second Priority Claims and ABDC under
Section 6.01 and (ii) subject to Section 6.01 and compliance with its
obligations to take certain actions upon Discharge of the First Priority Claims
pursuant to Article V, with respect to the First Priority Agent, the First
Priority Secured Parties and the First Priority Claims, the date of Discharge of
First Priority Claims, subject to the rights of the First Priority Secured
Parties under Section 6.01. In addition, for the avoidance of doubt, the Lien
priorities provided for herein and the respective rights, interests, agreements
and obligations hereunder of the First Priority Agent and the other First
Priority Secured Parties and the Second Priority Secured Parties shall remain in
full force and effect irrespective of: (a) any change in the time, place or
manner of payment of, or in any other term of, all or any portion of the First
Priority Claims, it being specifically acknowledged that a portion of the First
Priority Claims consists or may consist of Indebtedness that is revolving in
nature, and the amount thereof that may be outstanding at any time or from time
to time may be increased or reduced and subsequently reborrowed (provided that
the aggregate principal committed amount thereof shall not exceed $150,000,000);
(b) any change in the time, place or manner of payment of, or any other term of,
all or any portion of the First Priority Claims; (c) any amendment, waiver or
other modification, whether by course of conduct or otherwise, of any Debt
Document (provided that the aggregate principal committed amount thereof shall
not exceed $150,000,000); (d) the securing of any First Priority Claims or
Second Priority Claims with any additional collateral or guarantees, or any
exchange, release, voiding, avoidance or non-perfection of any security interest
in any Collateral or any other collateral or any release of any guarantee
securing any First Priority Claims or Second Priority Claims; (e) the
commencement of any Insolvency or Liquidation Proceeding or Liquidation Sale in
respect of the Company or any other Grantor; or (f) any other circumstances that
otherwise might constitute a defense available to, or a discharge of, the
Company or any other Grantor in respect of the First Priority Claims or this
Agreement, or any of the Second Priority Secured Parties in respect of this
Agreement.

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          SECTION 9.04. Severability. In the event any one or more of the
provisions contained in this Agreement should be held invalid, illegal or
unenforceable in any respect, the validity, legality and enforceability of the
remaining provisions contained herein shall not in any way be affected or
impaired thereby (it being understood that the invalidity of a particular
provision in a particular jurisdiction shall not in and of itself affect the
validity of such provision in any other jurisdiction). The parties shall
endeavor in good-faith negotiations to replace the invalid, illegal or
unenforceable provisions with valid provisions the economic effect of which
comes as close as possible to that of the invalid, illegal or unenforceable
provisions.
          SECTION 9.05. Amendments; Waivers. (a) No failure or delay on the part
of any party hereto in exercising any power or right hereunder shall operate as
a waiver thereof, nor shall any single or partial exercise of any such right or
power, or any abandonment or discontinuance of steps to enforce such a right or
power, preclude any other or further exercise thereof or the exercise of any
other right or power. The rights and remedies of the parties hereto are
cumulative and are not exclusive of any rights or remedies that they would
otherwise have. No waiver of any provision of this Agreement or consent to any
departure by any party therefrom shall in any event be effective unless the same
shall be permitted by paragraph (b) of this Section 9.05, and then such waiver
or consent shall be effective only in the specific instance and for the purpose
for which given.
          (b) Neither this Agreement nor any provision hereof may be waived,
amended or modified except pursuant to an agreement or agreements in writing
entered into by the First Priority Agent and ABDC.
          SECTION 9.06. Postponement of Subrogation. The Second Priority Secured
Parties agrees that no payment or distribution to any First Priority Secured
Party pursuant to the provisions of this Agreement shall entitle any Second
Priority Secured Party to exercise any rights of subrogation in respect thereof
until the Discharge of First Priority Claims shall have occurred. Following the
Discharge of First Priority Claims, each First Priority Secured Party agrees to
execute such documents, agreements, and instruments as any Second Priority
Secured Party may reasonably request to evidence the transfer by subrogation to
any such Person of an interest in the First Priority Claims resulting from
payments or distributions to such First Priority Secured Party by such Person,
so long as all costs and expenses (including all reasonable legal fees and
disbursements) incurred in connection therewith by such First Priority Secured
Party are paid by such Person upon request for payment thereof.
          SECTION 9.07. Applicable Law; Jurisdiction; Consent to Service of
Process. (a) THIS AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED
BY THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO CONFLICTS OF LAW
PRINCIPLES THAT WOULD REQUIRE THE APPLICATION OF THE LAWS OF ANOTHER
JURISDICTION.
          (b) Each party hereto hereby irrevocably and unconditionally submits,
for itself and its property, to the non-exclusive jurisdiction of any Supreme
Court for New York County, New York or in The United States District Court for
the Southern District of New York, and any appellate court from any thereof, in
any action or proceeding arising out of or relating to this Agreement, or for
recognition or enforcement of any judgment, and each of the parties hereto
hereby irrevocably and unconditionally agrees that all claims in respect of any
such action or proceeding may be heard and determined only in such New York
court or, to the extent permitted by law, in such Federal court. Each party
hereto agrees that a final judgment in any such action

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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.
          (c) Each party hereto hereby irrevocably and unconditionally waives,
to the fullest extent it may legally and effectively do so, any objection which
it may now or hereafter have to the laying of venue of any suit, action or
proceeding arising out of or relating to this Agreement in any New York court or
in any such Federal court. Each party hereto hereby irrevocably waives, to the
fullest extent permitted by law, the defense of an inconvenient forum to the
maintenance of such action or proceeding in any such court.
          (d) Each party to this Agreement irrevocably consents to service of
process in the manner provided for notices in Section 9.01. Nothing in this
Agreement will affect the right of any party to this Agreement to serve process
in any other manner permitted by law.
          SECTION 9.08. Waiver of Jury Trial. EACH PARTY HERETO HEREBY WAIVES,
TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A
TRIAL BY JURY IN RESPECT OF ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT
OF, UNDER OR IN CONNECTION WITH THIS AGREEMENT. EACH PARTY HERETO (A) CERTIFIES
THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED,
EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF
LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT
AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT, BY,
AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION 9.08.
          SECTION 9.09. Parties in Interest. The provisions of this Agreement
shall be binding upon and inure to the benefit of the parties hereto and their
respective successors and assigns, as well as the other First Priority Secured
Parties and Second Priority Secured Parties, all of whom are intended to be
bound by, and to be third party beneficiaries of, this Agreement. No other
Person shall have or be entitled to assert rights or benefits hereunder.
          SECTION 9.10. Specific Performance. Each of the First Priority Agent
and ABDC may demand specific performance of this Agreement and, on behalf of
itself and the respective other Secured Parties, hereby irrevocably waives any
defense based on the adequacy of a remedy at law and any other defense that
might be asserted to bar the remedy of specific performance in any action which
may be brought by the respective Secured Parties.
          SECTION 9.11. Headings. Article and Section headings used herein and
the Table of Contents hereto are for convenience of reference only, are not part
of this Agreement and are not to affect the construction of, or to be taken into
consideration in interpreting, this Agreement.
          SECTION 9.12. Counterparts. This Agreement may be executed in
counterparts (and by different parties hereto on different counterparts), each
of which shall constitute an original but all of which when taken together shall
constitute a single contract, and shall become effective as provided in
Section 9.03. Delivery of an executed signature page to this Agreement by
facsimile transmission shall be as effective as delivery of a manually signed
counterpart of this Agreement.

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          SECTION 9.13. Provisions Solely to Define Relative Rights. The
provisions of this Agreement are and are intended solely for the purpose of
defining the relative rights of the First Priority Secured Parties, on the one
hand, and the Second Priority Secured Parties, on the other hand. None of the
Company, any other Grantor, any Guarantor or any other creditor thereof shall
have any rights or obligations, except as expressly provided in this Agreement
hereunder and none of the Company, any other Grantor or any Guarantor may rely
on the terms hereof. Nothing in this Agreement is intended to or shall impair
the obligations of the Company or any other Grantor or any Guarantor, which are
absolute and unconditional, to pay the First Priority Claims and the Second
Priority Claims as and when the same shall become due and payable in accordance
with their terms.
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          IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed by their respective authorized officers as of the day and year
first above written.

            JEFFERIES FINANCE LLC, as First Priority
Agent
      By:   /s/  E.J. Hess       Name:   E.J. Hess        Title:   Managing
Director        AMERISOURCEBERGEN CORPORATION, for itself and on behalf of the
Second Priority Secured Parties
      By:   /s/  Mitchell Blumenfeld       Name:   Mitchell Blumenfeld       
Title:   Chief Financial Officer   

 

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ACKNOWLEDGMENT
The Company and each of the Company’s undersigned Subsidiaries each hereby
acknowledge that they have received a copy of the foregoing Agreement and
consent thereto, agree to recognize all rights granted thereby to the First
Priority Agent and the Second Priority Secured Parties and to ABDC and the
Second Priority Secured Parties, and will not do any act or perform any
obligation which is not in accordance with the agreements set forth therein. The
Company and each of the Company’s undersigned Subsidiaries each further
acknowledge and agree that they are not an intended beneficiary or third party
beneficiary under the foregoing Agreement.

         

ACKNOWLEDGED AS OF THE DATE FIRST WRITTEN ABOVE:

BIOSCRIP, INC.
    By:   /s/ Barry A. Posner     Name:   Barry A. Posner      Title:  
Executive Vice President and General Counsel     

          BIOSCRIP INFUSION SERVICES, INC.
    By:   /s/ Barry A. Posner     Name:   Barry A. Posner      Title:  
Executive Vice President and General Counsel     

          CHRONIMED, LLC
    By:   /s/ Barry A. Posner     Name:   Barry A. Posner      Title:  
Executive Vice President and General Counsel     

          LOS FELIZ DRUGS INC.
    By:   /s/ Barry A. Posner     Name:   Barry A. Posner      Title:  
Executive Vice President and General Counsel     

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          BIOSCRIP PHARMACY, INC.
    By:   /s/ Barry A. Posner     Name:   Barry A. Posner      Title:  
Executive Vice President and General Counsel     

          BRADHURST SPECIALTY PHARMACY, INC.
    By:   /s/ Barry A. Posner     Name:   Barry A. Posner      Title:  
Executive Vice President and General Counsel     

          BIOSCRIP PHARMACY (NY), INC.
      By:   /s/ Barry A. Posner     Name:   Barry A. Posner      Title:  
Executive Vice President and General Counsel     

          BIOSCRIP PBM SERVICES, LLC
    By:   /s/ Barry A. Posner     Name:   Barry A. Posner      Title:  
Executive Vice President and General Counsel     

          NATURAL LIVING INC.
    By:   /s/ Barry A. Posner     Name:   Barry A. Posner      Title:  
Executive Vice President and General Counsel     

          BIOSCRIP INFUSION SERVICES, LLC
    By:   /s/ Barry A. Posner     Name:   Barry A. Posner      Title:  
Executive Vice President and General Counsel     

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          BIOSCRIP NURSING SERVICES, LLC
    By:   /s/ Barry A. Posner     Name:   Barry A. Posner      Title:  
Executive Vice President and General Counsel     

Signature Page to Acknowledgement to Intercreditor Agreement

 

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          BIOSCRIP INFUSION MANAGEMENT, LLC
    By:   /s/ Barry A. Posner     Name:   Barry A. Posner     Title:   Executive
Vice President and General Counsel    

          BIOSCRIP PHARMACY SERVICES, INC.
    By:   /s/ Barry A. Posner     Name:   Barry A. Posner     Title:   Executive
Vice President and General Counsel    

          CHS HOLDINGS, INC.
(FORMERLY CAMELOT ACQUISITION CORP.)  
    By:   /s/ Barry A. Posner     Name:   Barry A. Posner     Title:   Executive
Vice President and General Counsel    

          CRITICAL HOMECARE SOLUTIONS, INC.
    By:   /s/ Barry A. Posner     Name:   Barry A. Posner     Title:   Executive
Vice President and General Counsel    

          APPLIED HEALTH CARE, LLC
    By:   /s/ Barry A. Posner     Name:   Barry A. Posner     Title:   Executive
Vice President and General Counsel    

          CEDAR CREEK HOME HEALTH CARE AGENCY, INC.
    By:   /s/ Barry A. Posner     Name:   Barry A. Posner     Title:   Executive
Vice President and General Counsel    

Signature Page to Acknowledgement to Intercreditor Agreement

 

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          DEACONESS ENTERPRISES, LLC
    By:   /s/ Barry A. Posner     Name:   Barry A. Posner     Title:   Executive
Vice President and General Counsel    

          DEACONESS HOMECARE, LLC
    By:   /s/ Barry A. Posner     Name:   Barry A. Posner     Title:   Executive
Vice President and General Counsel    

          EAST GOSHEN PHARMACY, INC.
    By:   /s/ Barry A. Posner     Name:   Barry A. Posner     Title:   Executive
Vice President and General Counsel    

          ELK VALLEY HEALTH SERVICES, INC.
    By:   /s/ Barry A. Posner     Name:   Barry A. Posner     Title:   Executive
Vice President and General Counsel    

          ELK VALLEY HOME HEALTH CARE AGENCY, INC.      By:   /s/ Barry A.
Posner     Name:   Barry A. Posner     Title:   Executive Vice President and
General Counsel    

          ELK VALLEY PROFESSIONAL AFFILIATES, INC.
    By:   /s/ Barry A. Posner     Name:   Barry A. Posner     Title:   Executive
Vice President and General Counsel    

          GERICARE, INC.
    By:   /s/ Barry A. Posner     Name:   Barry A. Posner     Title:   Executive
Vice President and General Counsel    

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          INFUSION PARTNERS, LLC
    By:   /s/ Barry A. Posner     Name:   Barry A. Posner     Title:   Executive
Vice President and General Counsel    

          INFUSION PARTNERS OF BRUNSWICK, LLC
    By:   /s/ Barry A. Posner     Name:   Barry A. Posner     Title:   Executive
Vice President and General Counsel    

          INFUSION PARTNERS OF MELBOURNE, LLC
    By:   /s/ Barry A. Posner     Name:   Barry A. Posner     Title:   Executive
Vice President and General Counsel    

          INFUSION SOLUTIONS, INC.
    By:   /s/ Barry A. Posner     Name:   Barry A. Posner     Title:   Executive
Vice President and General Counsel    

          KNOXVILLE HOME THERAPIES, LLC
    By:   /s/ Barry A. Posner     Name:   Barry A. Posner     Title:   Executive
Vice President and General Counsel    

          NATIONAL HEALTH INFUSION, INC.
    By:   /s/ Barry A. Posner     Name:   Barry A. Posner     Title:   Executive
Vice President and General Counsel    

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          NEW ENGLAND HOME THERAPIES, INC.
    By:   /s/ Barry A. Posner     Name:   Barry A. Posner     Title:   Executive
Vice President and General Counsel    

          OPTION HEALTH, LTD.
    By:   /s/ Barry A. Posner     Name:   Barry A. Posner     Title:   Executive
Vice President and General Counsel    

          PROFESSIONAL HOMECARE SERVICES, INC.
    By:   /s/ Barry A. Posner     Name:   Barry A. Posner     Title:   Executive
Vice President and General Counsel    

          REGIONAL AMBULATORY DIAGNOSTICS, INC.
    By:   /s/ Barry A. Posner     Name:   Barry A. Posner     Title:   Executive
Vice President and General Counsel    

          SCOTT-WILSON, INC.
    By:   /s/ Barry A. Posner     Name:   Barry A. Posner     Title:   Executive
Vice President and General Counsel    

          SOUTH MISSISSIPPI HOME HEALTH, INC.
    By:   /s/ Barry A. Posner     Name:   Barry A. Posner     Title:   Executive
Vice President and General Counsel    

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          SOUTH MISSISSIPPI HOME HEALTH, INC. — REGION I
    By:   /s/ Barry A. Posner     Name:   Barry A. Posner     Title:   Executive
Vice President and General Counsel    

          SOUTH MISSISSIPPI HOME HEALTH, INC. — REGION II
    By:   /s/ Barry A. Posner     Name:   Barry A. Posner     Title:   Executive
Vice President and General Counsel    

          SOUTH MISSISSIPPI HOME HEALTH, INC. — REGION III
    By:   /s/ Barry A. Posner     Name:   Barry A. Posner     Title:   Executive
Vice President and General Counsel    

          SPECIALTY PHARMA, INC.
    By:   /s/ Barry A. Posner     Name:   Barry A. Posner     Title:   Executive
Vice President and General Counsel    

          WILCOX MEDICAL, INC.
    By:   /s/ Barry A. Posner     Name:   Barry A. Posner     Title:   Executive
Vice President and General Counsel    

Signature Page to Acknowledgement to Intercreditor Agreement