Document:

Exhibit 10.1

 

[EXECUTION COPY]

 

FIRST AMENDMENT TO CREDIT AGREEMENT

 

THIS FIRST AMENDMENT TO CREDIT AGREEMENT is dated as of July 22, 2014 (this “Amendment”), and is entered into by and among (i) 21C EAST FLORIDA, LLC, a Delaware limited liability company (together with its successors, the “Term B Loan Borrower”) and SOUTH FLORIDA RADIATION ONCOLOGY COCONUT CREEK, LLC, a Florida limited liability company (together with its successors, the “Term A Loan Borrower”) (each of the Term B Loan Borrower and the Term A Loan Borrower a “Borrower” and, collectively, the “Borrowers”), (ii) the Lenders party to the Existing Credit Agreement and (iii) CORTLAND CAPITAL MARKET SERVICES LLC, a Delaware limited liability company, as Administrative Agent and Collateral Agent.

 

R E C I T A L S

 

A.                                    The Borrowers, the Lenders, the Administrative Agent and the Collateral Agent are parties to that certain Credit Agreement dated as of February 10, 2014 (the “Existing Credit Agreement”), pursuant to which, among other things, the Lenders made Term A Loans to the Term A Loan Borrower and Term B Loans to the Term B Loan Borrower on the Closing Date, all on the terms and subject to the conditions set forth therein and in the other Loan Documents.  Unless otherwise indicated, capitalized terms used herein without definition shall have the meanings ascribed to them in the Existing Credit Agreement after giving effect to this Amendment (the Existing Credit Agreement, as amended by this Amendment, is sometimes referred to herein as the “Amended Credit Agreement”).

 

B.                                    The Term A Loan Borrower has requested that the Term A Loan Lenders make a new incremental term loan available to the Term A Loan Borrower in the aggregate principal amount equal to the Term A-1 Loan Commitment (the “Term A-1 Loan”) on the Term A-1 Loan Effective Date.  The Term A-1 Loan will be guarantied by the Term A Loan Guarantors under the Term A Loan Guarantee Agreement.

 

C.                                    In addition, the Term A Loan Borrower has requested that the Term A Loan Lenders make an additional incremental term loan available to the Term A Loan Borrower in the aggregate principal amount equal to the Term A-2 Loan Commitment (the “Term A-2 Loan”) on the Term A-2 Loan Effective Date.  The Term A-2 Loan will be guarantied by the Term A Loan Guarantors under the Term A Loan Guarantee Agreement and secured by Liens to be granted in favor of the Collateral Agent in and to the assets and properties of certain additional Covenant Parties.

 

D.                                    In addition, the Borrowers have advised the Lenders and the Agents that the Defaults and Events of Default listed on Annex A (collectively, the “First Amendment Specified Defaults”) have occurred and are continuing under the Existing Credit Agreement and certain other Loan Documents and have requested that the Lenders waive the First Amendment Specified Defaults and the additional interest accruing on the Term A Loans and the Term B Loans made on the Closing Date at the default rates, respectively, pursuant to Section 2.14(c) of the Existing Credit Agreement from the Closing Date through and including the Term A-1 Loan Effective Date solely with respect to the First Amendment Specified Defaults (such additional interest being the “First Amendment Specified Default Interest”).

 

E.                                     In addition, the Borrowers have requested that the Lenders agree to amend certain provisions of the Existing Credit Agreement and certain other Loan Documents.

 

F.                                      The Lenders are willing to (i) make the Term A-1 Loan available to the Term A Loan Borrower on the Term A-1 Loan Effective Date, (ii) make the Term A-2 Loan available to the Term A Loan Borrower on the Term A-2 Loan Effective Date (if it occurs), (iii) effective as of the Term A-1

 

 

Loan Effective Date, waive the First Amendment Specified Defaults, (iv) effective as of the Term A-1 Loan Effective Date, waive the First Amendment Specified Default Interest that accrued on and after the Closing Date through and including March 30, 2014 (the “Waived First Amendment Specified Default Interest”), (v) effective as of the Term A-2 Loan Effective Date (if it occurs), waive the First Amendment Specified Default Interest that accrued on and after March 31, 2014 through and including the Term A-1 Loan Effective Date (the “Suspended First Amendment Specified Default Interest”) and (vi) amend the Existing Credit Agreement and certain other Loan Documents as provided herein, but, in each case, only on the terms and subject to the conditions set forth herein and in the other Term A-1 Loan Documents.

 

G.                                    It is a condition precedent to the making of the Term A-1 Loans that, among other things, the Target Sellers purchase participation interests in the Term A Loan Lenders’ Term A-1 Loans as provided herein and in the Target Seller Participation Agreements.

 

A G R E E M E N T

 

NOW, THEREFORE, in consideration of the mutual covenants, conditions and provisions contained herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereby agree as follows:

 

SECTION 1.
 WAIVER OF FIRST AMENDMENT SPECIFIED DEFAULTS

 

1.1                               Pursuant to Section 9.1(b) of the Credit Agreement and in reliance upon the representations, warranties, covenants and agreements of the Borrowers contained in this Amendment and the other Term A-1 Loan Documents:

 

(a)                                 Effective as of Term A-1 Loan Effective Date, the Required Lenders waive the First Amendment Specified Defaults;

 

(b)                                 Effective as of Term A-1 Loan Effective Date, the Required Lenders waive the Waived First Amendment Specified Default Interest; and

 

(c)                                  Effective as of Term A-2 Loan Effective Date (if it occurs), the Required Lenders waive the Suspended First Amendment Specified Default Interest.

 

The Borrowers hereby acknowledge and agree that the Lenders are currently entitled to receive the First Amendment Specified Default Interest and that the total amount of Suspended First Amendment Specified Default Interest shall be equal to $802,928, comprising Suspended First Amendment Specified Default Interest accrued on the Term A Loans made on the Closing Date of $49,595 and Suspended First Amendment Specified Default Interest accrued on the Term B Loans made on the Closing Date of $753,333.  (For clarification purposes, the Borrowers further acknowledge and agree that the Required Lenders are not waiving any interest accruing at the applicable non-default rate.)

 

1.2                               Notwithstanding anything to the contrary, if the Term A-2 Loan Effective Date shall not occur, (a) the Borrowers shall pay all Suspended First Amendment Specified Default Interest accrued on the Term A Loans as described in Section 1.1 above in cash on the Term A-2 Loan Outside Effective Date and (b) the Borrowers shall pay all Suspended First Amendment Specified Default Interest accrued on the Term B Loans in accordance with Section 2.14(b) of the Amended Credit Agreement.

 

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1.3                               The waivers provided for in Section 1.1 above shall be limited solely to the First Amendment Specified Defaults and the First Amendment Specified Default Interest as expressly described herein and shall not extend to any subsequent or other breach, violation, Default or Event of Default, whether past, present or future, under the Existing Credit Agreement, the Amended Credit Agreement or any other Loan Document, and shall not impair any right, power or remedy of the Lenders or the Agents (or any of them) as a consequence thereof.  In addition, the limited waivers provided for in Section 1.1 shall not give rise to any obligation whatsoever on the part of any Lender or Agent to grant any waivers in the future.

 

SECTION 2.
 AMENDMENTS TO CREDIT AGREEMENT

 

Effective on and as of Term A-1 Loan Effective Date, the Required Lenders and the Agents agree to the following amendments to the Existing Credit Agreement:

 

2.1                               Amendments to Section 1.1 (Defined Terms).  Section 1.1 of the Existing Credit Agreement shall be amended as follows:

 

(a)                                 The following new definitions shall be added to such Section in the appropriate alphabetical order:

 

“‘21C Filing Event’ means the voluntary bankruptcy filing of any of the 21C Guarantors.”

 

“‘Call Date’:  means the six (6) month anniversary of the later to occur of the Term A-1 Loan Effective Date and, if it occurs, the Term A-2 Loan Effective Date.”

 

“‘Comerica Loan Agreement’:  means that certain Loan Agreement dated as of August 7, 2013, between Target and Comerica Bank, as amended, supplemented or otherwise modified from time to time.”

 

“‘Commitments’:  means the Term A Loan Commitments and the Term B Loan Commitments.”

 

“‘First Amendment’:  means that certain First Amendment to Credit Agreement dated as of July 22, 2014, by and among the parties.”

 

“‘First Amendment Specified Default Interest’:  shall have the meaning set forth in the recitals to the First Amendment.”

 

“‘First Amendment Specified Defaults’:  shall have the meaning set forth in the recitals to the First Amendment.”

 

“‘Incremental Term A Loans’:  shall mean the Term A-1 Loans and, if made, the Term A-2 Loans.”

 

“‘Other Indebtedness’:  shall have the meaning set forth in Section 6.14(e).”

 

“‘Seacoast Loan Agreement’: means that certain Business Loan Agreement entered into April 30, 2014, between Boynton Beach Real Estate, LLC, as “Borrower,” and Seacoast National Bank, as “Lender.”

 

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“‘Seacoast Security Agreement’:  means that certain Commercial Security Agreement entered into April 30, 2014, between Boynton Beach Real Estate, LLC and Seacoast National Bank.”

 

“‘Suspended First Amendment Specified Default Interest’:  shall have the meaning set forth in the recitals to the First Amendment.”

 

“‘Target Seller Participation Agreement’: means a Participation Agreement, in substantially the form attached as Exhibit H to the First Amendment, between a Term A Loan Lender with a Term A-1 Loan Commitment and the “Participant” named therein pursuant to which such Term A Loan Lender is selling the Target Seller Participation Interest to such Participant, as amended, supplemented or otherwise modified from time to time.”

 

“‘Target Seller Participation Interests’:  means, collectively, the “Participation Interests” purchased by the Target Sellers pursuant to the Target Seller Participation Agreements in the amounts and percentages set forth on Schedule 1.1C.”

 

“‘Term A-1 Loan’:  means any loan made pursuant to Section 2.1(c).”

 

“‘Term A-1 Loan Commitment’:  means, as to any Term A-1 Loan Lender, the obligation of such Lender, if any, to make a Term A-1 Loan to the Term A Loan Borrower on the Term A-1 Loan Effective Date pursuant to Section 2.1(c).  The aggregate principal amount of the Term A-1 Loan Commitments is $10,350,000.”

 

“‘Term A-1 Loan Documents’:  shall have the meaning set forth in the First Amendment.”

 

“Term A-1 Loan Effective Date’:  shall have the meaning set forth in the First Amendment.”

 

“‘Term A-1 Loan Upfront Fee’:  shall have the meaning set forth in the First Amendment.”

 

“‘Term A-1 Note’ means a promissory note made by the Term A Loan Borrower in favor of a Term A-1 Loan Lender evidencing the portion of the Term A-1 Loan made by such Term A-1 Loan Lender, substantially in the form of Exhibit A to the First Amendment, and any amendments, supplements and modifications thereto, any substitutes therefor, and any replacements, restatements, renewals or extension thereof, in whole or in part.”

 

“‘Term A-2 Loan’:  shall mean a term loan made pursuant to Section 2.1(d).”

 

“‘Term A-2 Loan Commitment’: means, as to any Term A-2 Loan Lender, the obligation of such Lender, if any, to make a Term A-2 Loan to the Term A Loan Borrower on the Term A-2 Loan Effective Date pursuant to Section 2.1(d).  The aggregate principal amount of the Term A-2 Loan Commitments is $16,700,000; provided, however, that if, prior to the Term A-2 Loan Effective Date, the Collateral Agent is granted a perfected Lien (including a silent second Lien) on the assets of Target and its Subsidiaries that are party to the Comerica Loan Agreement and related loan documents, on terms acceptable to the Lenders (including, among other things, the Borrower’s receipt of the written consent of Comerica Bank to the grant of such Lien and the execution and delivery of a lien

 

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subordination agreement with Comerica Bank in form and substance acceptable to the Lenders), subject only to (i) the Liens in favor of Comerica Bank on such assets and (ii) Liens otherwise permitted under the Comerica Loan Agreement securing Indebtedness that the Lenders do not elect to cause the Term A Loan Borrower or the other Restricted Subsidiaries to refinance pursuant to Section 6.14(e), the aggregate principal amount of the Term A-2 Loan Commitments shall be reduced to $11,700,000; and provided further, however, that the Term A-2 Loan Commitment may be increased if and to the extent that the Required Lenders exercise their rights under Section 6.14(e).”

 

“Term A-2 Loan Effective Date’: shall have the meaning set forth in Section 2.1(d).”

 

“‘Term A-2 Loan Outside Effective Date’:  shall have the meaning set forth in the First Amendment.”

 

“‘Term A-2 Loan Upfront Fee’:  shall have the meaning set forth in Section 2.1(d)(ii)(D).”

 

“‘Term A-2 Note’:  means a promissory note made by the Term A Loan Borrower in favor of a Term A-2 Loan Lender evidencing the portion of the Term A-2 Loan made by such Term A-2 Loan Lender, substantially in the form of Exhibit B to the First Amendment, and any amendments, supplements and modifications thereto, any substitutes therefor, and any replacements, restatements, renewals or extension thereof, in whole or in part.”

 

“‘Waived First Amendment Specified Default Interest’:  shall have the meaning set forth in the recitals to the First Amendment.”

 

(b)                                 Section 1.1 of the Existing Credit Agreement shall be amended further by amending and restating each of the following existing definitions in such Section to read in its entirety as follows:

 

“‘Administrative Agent Fee Letter’:  that certain Amended & Restated Administrative Agent Fee Letter dated as of the Term A-1 Loan Effective Date between the Administrative Agent and the Borrowers relating to certain fees payable to the Administrative Agent.”

 

“‘Borrowing Notice’:  means (i) with respect to the Term A Loan made on the Closing Date pursuant to Section 2.1(a), the notice from the Borrowers to the Administrative Agent in the form of Exhibit I hereto, and (ii) with respect to the Term A-1 Loans made on the Term A-1 Loan Effective Date or the Term A-2 Loans, if made, on the Term A-2 Loan Effective Date, as applicable, the notice from the Term A Loan Borrower to the Administrative Agent in the form of Exhibit C attached to the First Amendment.”

 

“‘Closing Date Refinancing’: means the repayment in full of that certain Promissory Note, dated as of June 1, 2013, by the Term A Loan Borrower, in favor of 1stLineOncology, LLC, a Florida limited liability company in the original principal amount of $8,000,000, of which  $7,214,005.56 remains outstanding as of the Closing Date, with the proceeds of the Term A Loan made pursuant to Section 2.1(a); provided that the associated Purchase Price Adjustment Promissory Note, dated as of June 1, 2013, between the Term A Loan Borrower, in favor of 1stLineOncology, LLC will remain outstanding.”

 

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“‘Consolidated Total Leverage Ratio’:  means, with respect to any Person, as of any date of determination, the ratio of (x) Consolidated Total Leverage of such Person at such date to (y) the aggregate amount of Consolidated EBITDA of such Person for the period of the most recent four consecutive fiscal quarters ended prior to the date of such determination for which internal consolidated financial statements of such Person are available, in each case, with such pro forma adjustments as are consistent with the pro forma adjustments set forth in the definition of “Consolidated Fixed Charge Coverage Ratio” (provided, however, that no pro forma adjustments shall be made to take into account or reflect any projected synergies or cost savings (other than compensation and related expenses of any principal owners of the target entity so long as the post-closing compensation arrangements of the principal owners are memorialized in a written employment or similar agreement)); provided that, for the purpose of determining Consolidated Total Leverage, the aggregate amount of cash and Cash Equivalents of such Person and its Restricted Subsidiaries shall be determined without giving pro forma effect to the proceeds of Indebtedness incurred on such date.”

 

“‘Excluded Target Subsidiary’:  means each of Boca Radiation Oncology, LLC, South Florida Radiation Oncology WPB, LLC and South Florida Radiation Oncology, LLC.”

 

“‘Interest Payment Date’:  means (i) with respect to the Term A Loans, the last day of each calendar quarter, commencing with the calendar quarter ending September 30, 2014, or if such day falls on a non-Business Day, then the immediately preceding Business Day; provided, however, that the first day upon which interest with respect to the Term A Loans shall be due shall be July 15, 2014, and (ii) with respect to the Term B Loans, January 15 and July 15 of each fiscal year, beginning on July 15, 2014, or if such day falls on a non-Business Day, then the next succeeding Business Day.”

 

“‘Lender Agent Agreement’:  means that certain Letter Agreement dated February 10, 2014, between the Lender Agent, on the one hand, and each of the Lenders party thereto from time to time, on the other hand, as amended, supplemented or otherwise modified from time to time, a copy of which will be provided to the Borrowers upon their request to the Administrative Agent.”

 

“‘Loan’:  means any Term A Loan, any Term B Loan or any other loan made by the Lenders (or any of them) to the Term A Loan Borrower or the Term B Loan Borrower, as the case may be.”

 

“‘Loan Documents’:  means this Agreement, the Term A Loan Guarantee Agreement, the Term B Loan Guarantee Agreement, the Security Documents, the Notes, the Administrative Agent Fee Letter, the Subordination Documents, the Term A-1 Loan Documents, the Target Seller Participation Agreements and all other agreements, certificates, instruments and other documents executed and delivered pursuant hereto or thereto or otherwise evidencing or securing any Loans or any other Obligations, and any amendment, waiver, supplement or other modification to any of the foregoing.”

 

“‘Notes’:  means, collectively, any Term A Loan Note, Term B Loan Note, Term A-1 Loan Note, Term A-2 Note, if any, and any other promissory notes evidencing a Loan made by the Lenders (or any of them) to the Term A Loan Borrower or the Term B Loan Borrower, as the case may be.”

 

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“‘Required Lenders’:  means, at any time, the holders (other than Defaulting Lenders) of more than fifty percent (50.0%) of the aggregate unpaid principal amount of (i) the Term A Loans made to the Term A Loan Borrower on the Closing Date pursuant to Section 2.1(a) plus (ii) the Term B Loans made to the Term B Loan Borrower on the Closing Date pursuant to Section 2.1(b).”

 

“‘Security Documents’:  means, collectively, the Term A Pledge and Security Agreement, the Term B Pledge and Security Agreement and all other collateral, pledge, security and similar pledge, security or credit support documents now or hereafter existing in favor of the Lenders, the Collateral Agent or the Administrative Agent in order to attach, create, grant, perfect, record or determine the priority of any Lien on any asset or property of a Borrower, a Guarantor or any Covenant Party to secure the obligations and liabilities of such Borrower, Guarantor or Covenant Party under any Loan Document.”

 

“‘Target Escrow Agreement’ or ‘Escrow Agreement’:  means that certain Escrow Agreement dated as of February 10, 2014, by and among the Target Sellers, the Term B Loan Borrower (as buyer), and JPMorgan Chase Bank, National Association, as the Escrow Agent, entered into pursuant to the Target Acquisition Agreement.”

 

“‘Term A Loan’:  means (i) the “Term A Loan” made to the Term A Loan Borrower pursuant to Section 2.1(a), (ii) the Term A-1 Loan made to the Term A Loan Borrower pursuant to Section 2.1(c) and (iii) the Term A-2 Loan made (if made) to the Term A Loan Borrower pursuant to Section 2.1(d).”

 

“‘Term A Loan Borrower’:  shall have the meaning set forth in the preamble.”

 

“Term A Loan Commitment(s)’:  means, collectively, (i) as to any Term A Loan Lender, the obligation of such Lender, if any, to make a Term A Loan to the Term A Loan Borrower on the Closing Date pursuant to Section 2.1(a) (the aggregate principal amount of which is $7,900,000), (ii) the Term A-1 Loan Commitments and (iii) the Term A-2 Loan Commitments.”

 

“‘Term A Loan Guarantee Agreement’:  means that certain Guaranty Agreement dated as of February 10, 2014, by and among the Term A Loan Borrower, the Term A Loan Guarantors party thereto and the Collateral Agent, as amended from time to time.”

 

“‘Term A Loan Guarantors’: means the collective reference to the (a) Target and (b) the other Term A Loan Subsidiary Guarantors.”

 

“Term A Loan Subsidiary Guarantors’: means each Restricted Subsidiary other than (i) each Excluded Target Subsidiary, until such time (if any) it becomes a Term A Loan Guarantor pursuant to the terms of this Agreement, including Section 6.14(c), (ii) any Foreign Subsidiary, (iii) any non-wholly-owned Subsidiary, to the extent such Subsidiary is precluded from becoming a Term A Loan Guarantor (or, to so become, would require the consent of a third party that is a holder of Capital Stock of such Subsidiary) by the terms of such Subsidiary’s organizational or related documents as they exist on the date of this Agreement, (iv) any Subsidiary that is prohibited by applicable law from becoming a Guarantor, (v) any Subsidiary to the extent the burden or cost of such Subsidiary becoming a Term A Loan Guarantor outweighs the benefit afforded thereby as determined by the Administrative Agent; and (vi) the Term A Loan Borrower; provided that any Person constituting a Term A Loan Subsidiary Guarantor shall cease to constitute a Term A Loan

 

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Subsidiary Guarantor when its respective guarantee is otherwise released in accordance with the terms of the Loan Documents.”

 

“‘Term B Loan’:  means a term loan made pursuant to Section 2.1(b).”

 

“‘Term B Loan Borrower’:  has the meaning set forth in the preamble.”

 

“‘Term B Loan Guarantee Agreement’:  means that certain Guarantee dated as of February 10, 2014, by and among Parent, 21C, the Term B Loan Guarantors and the Administrative Agent, as amended from time to time.”

 

“‘Treasure Coast Medicine’ shall mean Treasure Coast Medicine, LLC, a Florida limited liability company.”

 

(c)                                  Clause (12) of the definition of “Permitted Liens” shall be amended and restated to read in its entirety as follows:

 

“(12)                    Liens granted by Boynton Beach Real Estate, LLC in certain “Collateral” as defined in, and pursuant to, the Seacoast Security Agreement;”

 

(d)                                 Section 1.1 of the Existing Credit Agreement shall be amended further by deleting the definition of “Escrow Agreement” from such Section.

 

2.2                               Amendments to Section 2.1 (Loan Commitments).

 

(a)                                 Section 2.1 of the Existing Credit Agreement shall be amended by adding the following new clause (c) at the end of such Section:

 

“(c)                            Subject to the applicable terms and conditions set forth in the First Amendment, each Term A Loan Lender with a Term A-1 Loan Commitment as set forth in Schedule 1.1A severally agrees to make the Term A-1 Loan to the Term A Loan Borrower on the Term A-1 Loan Effective Date in accordance with its Term A-1 Loan Commitment.  The Term A-1 Loans will be Eurodollar Loans unless the Eurodollar Rate is unavailable at which time the interest rate shall be determined in accordance with Section 2.16.”

 

(b)                                 Section 2.1 of the Existing Credit Agreement shall be amended further by adding the following new clause (d) at the end of such Section:

 

“(d)                           (i)  Each Term A Loan Lender with a Term A-2 Loan Commitment severally agrees to make Term A-2 Loans to the Term A Loan Borrower, subject to the terms and conditions set forth in this Section 2.1(d), and the Term A Loan Borrower hereby grants to each such Term A Loan Lender an exclusive right to make such Term A-2 Loan to the Term A Loan Borrower, provided that the Term A Loan Lenders agree to notify the Term A Loan Borrower promptly that such Term A Loan Lender will not make the election to provide the Term A-2 Loans (if such Term A Loan Lender determines not to do so) and the exclusive right of such Term A Loan Lender to provide its Term A-2 Loan shall terminate upon the earlier of receipt of such notification and the Term A-2 Outside Effective Date.  If such Term A Loan Lender elects to make such Term A-2 Loan to the Term A Loan Borrower pursuant to this Section 2.1(d)(i), the Administrative Agent shall provide written notice to the Term A Loan Borrower of such election,

 

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at which time the Term A Loan Borrower shall be obligated to use its best efforts to satisfy the terms and conditions set forth in Section 2.1(d)(ii) and shall borrow the Term A-2 Loan from such Term A Loan Lender (and, among other things, pay the fees, costs and expenses associated therewith as provided in Section 5.3 of the First Amendment)); provided that the waiver of any conditions set forth in Section 2.1(d)(ii) by the Required Lenders shall not require the Term A Loan Borrower to borrow the Term A-2 Loans if such borrowing would result in a Default or Event of Default hereunder which the Required Lender are unwilling to waive or under any Other Indebtedness unless the Required Lenders exercise their rights under Section 6.14(e) with respect to such Other Indebtedness.

 

(ii)                                  Notwithstanding anything to the contrary, the obligations of each Term A Loan Lender with a Term A-2 Loan Commitment to make a Term A-2 Loan to the Term A Loan Borrower shall be subject to the satisfaction of each of the following conditions precedent (in addition to usual and customary conditions precedent and other conditions precedent as may be requested by the Administrative Agent or the Lenders), in each case in the sole and absolute discretion of the Administrative Agent and the Lenders (unless waived by the Required Lenders) (the date of the satisfaction of all such conditions being referred to herein as the “Term A-2 Loan Effective Date”):

 

(A)                               Term A-2 Loan Outside Effective Date.  The last of the conditions precedent to the obligations of such Term A Loan Lenders to make the Term A-2 Loans shall be satisfied not later than 1:00 p.m. (Los Angeles time) on September 15, 2014 (as such date may be extended by the mutual written agreement of the Administrative Agent (on behalf of itself and the Required Lenders) and the Borrowers, the “Term A-2 Loan Outside Effective Date”).

 

(B)                               Completion of Due Diligence Investigation.  The Lenders and the Agents (including their respective financial accountants and other advisors) shall have completed all of its or their business, financial and legal due diligence of the Borrowers and their subsidiaries and other Affiliates, and the results of such due diligence investigation shall be satisfactory in the sole and absolute discretion of the Lenders and the Agents.

 

(C)                               Borrowing Notice.  The Administrative Agent shall have received a Borrowing Notice pursuant to Section 2.2, duly executed by the Term A Loan Borrower, with respect to the Term A-2 Loans.

 

(D)                               Fees and Expenses.  The Term A Loan Borrower shall have paid (or reimbursed the Lenders and the Agents for) (i) a non-refundable up-front fee in cash in an amount equal to three and one-half percent (3.50%) of the aggregate principal amount of the Term A-2 Loans (the “Term A-2 Loan Upfront Fee”) and (ii) all unpaid fees, costs and expenses incurred by the Lenders and the Agents as provided in Section 5.3 of the First Amendment.  The parties agree that the Term A-2 Loan Upfront Fee shall be deemed fully earned as of the Term A-2 Loan Effective Date.  The parties further agree that the Term A-2 Loan Upfront Fee and such fees, costs and expenses shall be paid with (and may be

 

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withheld by the Lenders and the Administrative Agent from) the gross proceeds of the Term A-2 Loans made (if made) on the Term A-2 Loan Effective Date and will be reflected in the funding instructions given by the Borrowers to the Administrative Agent on or before the Term A-2 Loan Effective Date.  The parties further agree that, notwithstanding anything to the contrary herein, the payment of the Term A-2 Loan Upfront Fee shall be treated for all federal, state and local income tax purposes as a reduction to the issue price of the Term A-2 Loans pursuant to the principles of Section 1.1273-2(g)(2) of the Treasury Regulations and, accordingly, for purposes of Section 1271 et seq. of the Code, the original issue price of the Term A-2 Loans will be 96.50% of their gross principal amount.

 

(E)                                Term A-2 Loan Documents.  The Administrative Agent shall have received the following documents, each dated as of the Term A-2 Loan Effective Date (unless otherwise indicated herein):

 

(1)                                 Second Amendment.  A Second Amendment to the Amended Credit Agreement, in form and substance reasonably satisfactory to the Lenders and the Agents, together with all Exhibits and Schedules thereto, duly executed by the Borrowers.

 

(2)                                 Additional Documents.  Certain of the documents described in Section 3.4 of the First Amendment as may be requested by the Lenders or the Administrative Agent, in form and substance reasonably satisfactory to the Lenders or such Agent, duly executed by the respective parties thereto.

 

(3)                                 Security Documents.  Such Security Documents as may be reasonably requested by the Lenders or the Collateral Agent, in form and substance reasonably satisfactory to the Lenders and the Collateral Agent, duly executed by the parties thereto.

 

(4)                                 Other Documents.  Such other agreements, instruments, secretary’s, officer’s and other certificates, amendments, legal opinions and other documents as the Lenders or the Agents may reasonably request, in form and substance reasonably satisfactory to the Lenders and the Agents.

 

(F)                                 Payoff Letters.  The Administrative Agent shall have received a payoff letter, in form and substance satisfactory to the Administrative Agent, duly executed by each creditor, if any, of the Borrowers or the Term A Loan Guarantors and other Persons, as applicable, to be repaid in full on the Term A-2 Loan Effective Date.

 

(G)                               Consents and Approvals.  All requisite Governmental Authorities and other third parties shall have approved of, consented to or waived rights with respect to the execution, delivery and performance by any Borrower and the other Covenant Parties of this Amendment and the other agreements, instruments and other documents to be entered into with respect to the Term A-2 Loans and the consummation of the transactions contemplated thereby, and the Administrative Agent shall have received

 

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true, correct and complete copies of all such approvals, waivers and consents.

 

(H)                              No Defaults.  No Defaults or Events of Default shall have occurred and be continuing or would result from the execution, delivery or performance of the agreements, instruments and other documents to be entered into with respect to the Term A-2 Loans or the consummation of the transactions contemplated thereby.

 

(I)                                   Other Lender Requests.  Each Borrower shall, and shall cause the Restricted Subsidiaries to, execute and deliver to the Administrative Agent such other documents, in form and substance satisfactory to the Administrative Agent and the Lenders, as the Administrative Agent or the Lenders may request.

 

(iii)                               The proceeds of the Term A-2 Loans, if made, shall be used by the Term A Loan Borrower solely to (a) refinance all Closing Date Consent Indebtedness in full (inclusive of all amounts owed, including any prepayment premium) in the aggregate amount of approximately $3,341,755; (b) refinance Indebtedness of Target and its Subsidiaries owing to Comerica Bank under the Comerica Loan Agreement and related loan documents in the aggregate amount of $8,000,000 (provided, however, that if, prior to the Term A-2 Loan Effective Date, the Collateral Agent is granted a perfected second Lien (which second Lien may be a silent second Lien) on the assets of Target and its Subsidiaries that are party to the Comerica Loan Agreement and related loan document, on terms acceptable to the Lenders (including, among other things, the Borrower’s receipt of the written consent of Comerica Bank to the grant of such perfected Lien and the execution and delivery of a lien subordination agreement with Comerica Bank in form and substance acceptable to the Lenders), subject only to (i) the Liens in favor of Comerica Bank on such assets and (ii) Liens otherwise permitted under the Comerica Loan Agreement securing Indebtedness that the Lenders do not elect to cause the Term A Loan Borrower or the other Restricted Subsidiaries to refinance pursuant to Section 6.14(e), such proceeds will be used to refinance an aggregate amount of $3,000,000 of such Indebtedness only); (c) purchase equipment to be subject to operating leases for an aggregate purchase price of approximately $2,150,000; (d) prepay a portion of each Lender’s Term A-1 Loan in an amount necessary for such Lender to repurchase the Target Seller Participation Interests in such Lender’s Term A-1 Loan pursuant to the relevant Target Seller Participation Agreement; (e) if the Required Lenders exercise their rights under Section 6.14(e), to refinance in full any such Other Indebtedness; and (f) pay the fees, costs and expenses of the transactions related thereto and contemplated hereby to be consummated on the Term A-2 Loan Effective Date to the extent required to be paid hereunder.

 

(iv)                              The Term A-2 Loans, if made, will be Eurodollar Loans unless the Eurodollar Rate is unavailable at which time the interest rate shall be determined in accordance with Section 2.16.”

 

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2.3                               Amendments to Section 2.2 (Procedure for Loan Borrowing).  Section 2.2 of the Existing Credit Agreement shall be amended and restated to read in its entirety as follows:

 

“2.2                         Procedures for Loan Borrowing.  The Term A Loan Borrower or the Term B Loan Borrower, as applicable, shall give the Administrative Agent an irrevocable Borrowing Notice (which notice must be received by the Administrative Agent prior to 12:00 pm on the Business Day prior to the Closing Date, the Term A-1 Loan Effective Date or the Term A-2 Loan Effective Date, as applicable, or at such other time reasonably acceptable to the Administrative Agent in advance of any such Date).  Upon receipt of the Borrowing Notice, the Administrative Agent shall promptly notify each applicable Lender thereof.  Not later than 12:00 Noon on the Closing Date, the Term A-1 Loan Effective Date or the Term A-2 Loan Effective Date, as applicable, each Lender shall, subject to the terms and conditions in this Agreement, make available to the Administrative Agent (by wire transfer of immediately available funds) at the Funding Office an amount in immediately available funds equal to (i) with respect to the Term A Loans to be made on the Closing Date, its Term A Loan Commitment (less, if applicable, the Term A Loan Funding Discount), (ii) with respect to the Term A-1 Loan to be made on the Term A-1 Loan Effective Date its Term A-1 Loan Commitment (less the Term A-1 Loan Upfront Fee), or (iii) with respect to the Term A-2 Loan to be made on the Term A-2 Loan Effective Date, if it occurs, its Term A-2 Loan Commitment (less the Term A-2 Loan Upfront Fee), as applicable, to be funded.  Upon confirmation of its receipt of all such net Term A Loan Commitments or net Term B Loan Commitments, as applicable, to be funded and satisfaction of all applicable conditions precedent to such funding, the Administrative Agent shall (at the direction of the Required Lenders) credit the account of each Borrower specified in the Borrowing Notice (by wire transfer of immediately available funds) with the aggregate of the amounts of Term A Loans or Term B Loans, as applicable (and, in each case, less the applicable Term A or Term B Loan Funding Discount or Term A-1 Loan Upfront Fee or Term A-2 Loan Upfront Fee), made available on the Closing Date, the Term A-1 Loan Effective Date or the Term A-2 Loan Effective Date, as applicable, to the Administrative Agent by the Lenders, less any fees and expenses then due to the Administrative Agent or any Lender.”

 

2.4                               Amendment to Section 2.4 (Funding Discount).  Section 2.4 of the Existing Credit Agreement shall be amended as follows:

 

(a)                                 Subparagraph (a) of Section 2.4 of the Existing Credit Agreement shall be amended and restated to read in its entirety as follows:

 

“(a)                           Each initial Term A Lender will fund its Term A Loan made to the Term A Loan Borrower pursuant to Section 2.1(a) net of a three percent (3.0%) discount (the “Term A Loan Funding Discount”), but will be deemed to have funded the entire gross amount of such Term A Loan set forth in Schedule 1.1A, and extended credit to the Term A Loan Borrower in such gross amount, and the Register maintained by the Administrative Agent pursuant to Section 9.6(c) will so reflect.  The Term A Loan Borrower, the Term A Loan Lenders and the Agents agree, for purposes of Section 1271 et seq. of the Code, the original issue price of such Term A Loans will be 97.00% of their gross principal amount as reflected in Schedule 1.1A.”

 

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(b)                                 Subparagraph (c) of Section 2.4 of the Existing Credit Agreement shall be amended and restated to read in its entirety as follows:

 

“(c)                            The foregoing clauses (a) and (b) are intended to constitute an agreement as to the issue prices and initial amounts of the Term A Loans made on the Closing Date and the Term B Loans made on the Closing Date for all federal, state and local income Tax purposes (for the avoidance of doubt, notwithstanding anything in Section 5.4 of the First Amendment to the contrary).”

 

2.5                               Amendments to 2.10 (Optional Prepayments).  Section 2.10 of the Existing Credit Agreement shall be amended and restated to read in its entirety as follows:

 

“2.10                  Optional Prepayments.

 

(a)                                 Except as provided in Section 2.10(d), the Term A Loan Borrower may not voluntarily prepay any of the Term A Loans on or prior to the Call Date.  Thereafter, the Term A Loan Borrower may voluntarily prepay the Term A Loans at par at any time and from time to time, in whole or in part, without premium or penalty; provided, however, that any Indebtedness incurred to refinance the Term A Loans shall bear an “all-in” yield to maturity of not more than six and one-half percent (6.50%) per annum.  Any such permitted prepayment of the Term A Loans shall be pursuant to an irrevocable (unless otherwise agreed by the Administrative Agent) written notice delivered to the Administrative Agent no later than 12:00 Noon, one Business Day prior thereto, which notice shall specify the date and amount of prepayment.

 

(b)                                 The Term B Loan Borrower may not voluntarily prepay any of the Term B Loans unless and until the Term A Loans have been repaid in full.  Thereafter, the Term B Loan Borrower may at any time and from time to time prepay the Term B Loans, in whole or in part, accompanied by the then-applicable Repayment Premium, upon irrevocable (unless otherwise agreed by the Administrative Agent) written notice delivered to the Administrative Agent no later than 12:00 noon, one Business Day prior thereto, which notice shall specify the date and amount of prepayment.

 

(c)                                  Any portion of the Loans prepaid under this Section 2.10 shall include principal, the Repayment Premium applicable at the time of such prepayment and all accrued and unpaid interest thereon and all outstanding fees and expenses hereunder.  Upon receipt of any notice of prepayment pursuant to this Section 2.10, the Administrative Agent shall promptly notify each relevant Lender thereof.  If any such notice is given, the amount specified in such notice shall be due and payable on the date specified therein, together with the Repayment Premium, if any, and accrued and unpaid interest to such date on the amount being prepaid.  Partial prepayments of Loans shall be in an aggregate principal amount of $500,000 or a whole multiple thereof (unless a lesser amount is required to repay such Loan in full); provided that a notice of prepayment of the Loans delivered by a Borrower may state that such notice is conditioned upon the effectiveness of other credit facilities or other debt instruments, in which case such notice may be revoked by the Borrower giving such notice (by written notice to the Administrative Agent on or prior to the specified effective date) if such condition is not satisfied.

 

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(d)                                 Notwithstanding Section 2.10(a), on or prior to the Call Date:  (i) the Term A Loan Borrower may prepay a portion of the Term A Loans on the Term A-2 Loan Effective Date in an amount necessary to permit the Term A Loan Lenders with a Term A-1 Loan Commitment to pay in full the Target Seller Participation Interests and (ii) the Term A Loan Borrower may prepay all of the Term A Loan Obligations if the Borrowers pay in full all of the Obligations outstanding at such time.  Any prepayment of the Term A Loans pursuant to clause (ii) of this subparagraph (d) shall be accompanied by the payment of a prepayment premium equal to the outstanding principal amount of the Term A Loans, multiplied by one hundred one percent (101.0%).”

 

2.6                               Amendments to 2.11 (Mandatory Prepayments).  Section 2.11 of the Existing Credit Agreement shall be amended to fix an inadvertent typo in such Section by inserting the following as a separate paragraph between Section 2.10 of the Existing Credit Agreement and clause (a) appearing thereunder:

 

“2.11                  Mandatory Prepayments.  Upon the occurrence of a Change of Control:”

 

2.7                               Amendments to 2.12 (Reserved).  Section 2.12 of the Existing Credit Agreement shall be amended and restated to read in its entirety as follows:

 

“2.12                  Other Mandatory Prepayments.  Immediately upon the disbursement or release of funds to or for the account of the Term B Loan Borrower, if any, from time to time from either Escrow Account (as defined in the Target Escrow Agreement), other than (a) funds released or disbursed from the Indemnity Escrow Account (as defined in the Escrow Agreement) by the Escrow Agent to or for the account of the Term B Loan Borrower to pay for cash losses associated with any indemnification event under the Escrow Agreement or (b) as a result of the Term A Loan Borrower obtaining the requisite consent of Seaside National Bank & Trust under its promissory notes with Treasure Coast Radiation Oncology, LLC, up to $3,636,771 of the Debt Escrow Amount (as defined in the Escrow Agreement) to be released by the Escrow Agent under Section 1.7(a) of the Escrow Agreement on the Term A-1 Loan Effective Date, the Term B Loan Borrower shall prepay the Term B Loans in an amount equal to the 100% of the amount so disbursed or released, accompanied by the applicable Repayment Premium.  The Term B Loan Borrower shall cause the Joint Instruction (as defined in the Escrow Agreement) to be given to the Escrow Agent with respect to any such disbursement or release to instruct the Escrow Agent to pay such disbursed or released funds directly to the Administrative Agent pursuant to wire transfer instructions provided by the Administrative Agent.”

 

2.8                               Amendments to 2.14 (Interest Rates and Payment Dates).  Subparagraph (a) of Section 2.14 of the Existing Credit Agreement shall be amended and restated to read in its entirety as follows:

 

“(a)                           The Term A Loans made to the Term A Loan Borrower pursuant to Section 2.1(a) shall bear interest for each day during each Interest Period with respect thereto and be payable in cash on each Interest Payment Date at a rate equal to the Eurodollar Rate plus 5.75% per annum (subject to Section 2.14(e)).  Each of the Incremental Term A Loans shall bear interest for each day during each Interest Period with respect thereto and be payable in cash on each Interest Payment Date at 

 

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a rate equal to the Eurodollar Rate plus 9.75% per annum (subject to Section 2.14(e)).”

 

2.9                               Amendments to 2.14 (Interest Rates and Payment Dates).  Subparagraph (c) of Section 2.14 of the Existing Credit Agreement shall be amended and restated to read in its entirety as follows:

 

“(c)                            Upon the occurrence and during the continuance of any Event of Default:

 

(i)                                     the principal amount of and all accrued and unpaid interest on any Term A Loan, and all fees, indemnities and any other Obligations, or other amount payable hereunder not paid when due (whether at the state maturity, by acceleration or otherwise) shall bear interest at a rate per annum equal to the rate that would otherwise be applicable thereto pursuant to this Section 2.14 plus 4.00% accruing from the date such Event of Default has occurred until the date such Event of Default has been waived by the Required Lenders.

 

(ii)                                  the principal amount of and all accrued and unpaid interest on any Term B Loan, and all fees, indemnities and any other Obligations, or other amount payable hereunder not paid when due (whether at the state maturity, by acceleration or otherwise) shall bear interest at a rate per annum equal to the rate that would otherwise be applicable thereto pursuant to this Section 2.14 plus 4.00% accruing from the date such Event of Default has occurred until the date such Event of Default has been waived by the Required Lenders.”

 

2.10                        Amendment to Subparagraph (e) of 2.14 (Interest Rates and Payment Dates).  Subparagraph (e) of Section 2.14 of the Existing Credit Agreement shall be amended and restated to read in its entirety as follows:

 

“(e)                            If, as of the last day of any fiscal quarter commencing with the fiscal quarter ending December 31, 2014, the Target and its Restricted Subsidiaries on a consolidated basis fail to generate Consolidated EBITDA of at least $23,750,000 (or, if the Term A-2 Loan Effective Date occurs, $25,550,000) for the Test Period then ended (as reported to Administrative Agent under Section 6.1), the interest rate applicable pursuant to Section 2.14(a) shall, effective as of the last day of such Test Period, increase by 2.00% and shall remain so increased until such time (if any) that Consolidated EBITDA of the Target and its Restricted Subsidiaries on a consolidated basis for a Test Period ending as of the last day of any subsequent fiscal quarter exceeds $23,750,000 (or, if the Term A-2 Loan Effective Date occurs, $25,550,000) (as reported to Administrative Agent in accordance with Section 6.1).  For the avoidance of doubt, the parties agree that if the Term B Loan Borrower and its Restricted Subsidiaries on a consolidated basis thereafter again fail to generate Consolidated EBITDA of at least $23,750,000 (or, if the Term A-2 Loan Effective Date occurs, $25,550,000) during any Test Period (as reported to Administrative Agent under Section 6.1), in accordance with the foregoing sentence, the interest rate would again increase by 2.00% effective as of the end of such subsequent Test Period and remain so increased until the last day of the next occurring fiscal quarter (if any) that Consolidated EBITDA of the Term B Loan Borrower and its Restricted Subsidiaries on a consolidated basis exceeds 

 

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$23,750,000 (or, if the Term A-2 Loan Effective Date occurs, $25,550,000) (as reported to Administrative Agent in accordance with Section 6.1).  For the purposes of this Section 2.14(e), if financial statements and a certification of the Consolidated EBITDA of the Target and its Restricted Subsidiaries on a consolidated basis for any fiscal quarter are not timely delivered pursuant to Section 6.1, Consolidated EBITDA of the Target and its Restricted Subsidiaries on a consolidated basis for the Test Period ended as of the last day of such fiscal quarter shall be deemed not to exceed $23,750,000 (or, if the Term A-2 Loan Effective Date occurs, $25,550,000) and the Interest Rate shall be increased in accordance with this Section 2.14(e).”

 

2.11                        Amendments to Section 2.17 (Pro Rata Treatment and Payments).  Section 2.17 of the Existing Credit Agreement shall be amended as follows:

 

(a)                                 Clause (b) of Section 2.17 of the Existing Credit Agreement shall be amended and restated to read in its entirety as follows:

 

“(b)                           The payment (including each prepayment) by the Term A Loan Borrower on account any Term A Loans shall be applied:  (i) first, to pay accrued and unpaid interest on all Term A Loans on a pro rata basis through and including the date of prepayment, (ii) second, to pay premium, if any, and (iii) third, to pay the aggregate outstanding principal balance of the Term A Loans on a pro rata basis.  Amounts prepaid on account of the Term A Loans may not be reborrowed.”

 

(b)                                 Clause (c) of Section 2.17 of the Existing Credit Agreement shall be amended and restated to read in its entirety as follows:

 

“(c)                            The payment (including each prepayment) by the Term B Loan Borrower on account any Term B Loans shall be applied:  (i) first, to pay accrued and unpaid interest on all Term B Loans on a pro rata basis through and including the date of prepayment, (ii) second, to pay the Repayment Premium, if any, and (iii) third, to pay the aggregate outstanding principal balance of the Term B Loans on a pro rata basis.  Amounts prepaid on account of the Term B Loans may not be reborrowed.”

 

2.12                        Amendments to Section 6.1 (Financial Statements; Books and Records).  Clause (i) of subparagraph (b) of Section 6.1 of the Existing Credit Agreement shall be amended by replacing “75 days” with “60 days”.

 

2.13                        Amendment to Section 6.6 (Indebtedness).  Subparagraph (d) of Section 6.6 of the Existing Credit Agreement shall be amended to read in its entirety as follows:

 

“(d)                           Indebtedness represented by Capitalized Lease Obligations and Purchase Money Indebtedness of any Restricted Subsidiary in the aggregate principal amount not to exceed $15,000,000;”

 

2.14                        Amendments to Section 6.6 (Indebtedness).  Subparagraph (l) of Section 6.6 of the Existing Credit Agreement shall be amended and restated to read in its entirety as follows:

 

“(l)                               (i) Indebtedness evidenced by guaranties issued by any Restricted Subsidiary and existing on or prior to the Term A-1 Loan Effective Date guarantying Indebtedness incurred by any other Restricted Subsidiary, provided

 

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that such other Indebtedness is otherwise expressly permitted to be incurred under this Agreement, and (ii) Indebtedness evidenced by guaranties issued by any Restricted Subsidiary (other than the Term A Loan Borrower) after the Term A-2 Loan Effective Date (if it occurs) guarantying Indebtedness or other obligations owing by any other Restricted Subsidiary, provided that such other Indebtedness is otherwise expressly permitted to be incurred under this Agreement;”

 

2.15                        Amendments to Section 6.7 (Restricted Payments).  Section 6.7 of the Existing Credit Agreement shall be amended as follows:

 

(a)                                 Clause (1) of subparagraph (b) of Section 6.7 of the Existing Credit Agreement shall be amended and restated to read in its entirety as follows:

 

“(1)                           dividends and distributions by Target which are either (i)  pro rata to the Term B Loan Borrower (65% of the total) and the Target Sellers (collectively, 35% of the total) in accordance with their respective interests in the Target’s Capital Stock or (ii) solely to the Term B Loan Borrower (without pro rata payment to the Target Sellers) and which, in each of clause (i) or (ii), the proceeds of such dividends and distributions are actually used by the Term B Loan Borrower solely to (A) make payments of accrued and unpaid interest on the Term B Loan or (B) pay corporate overhead expenses in an aggregate amount not to exceed $250,000 in any calendar year;”

 

(b)                                 Clause (2) of subparagraph (b) of Section 6.7 of the Existing Credit Agreement shall be amended and restated to read in its entirety as follows:

 

“(2)                           dividends and distributions by any Restricted Subsidiary (other than Target) to Target or any other Restricted Subsidiary;”

 

2.16                        Amendments to Section 6.11 (Transactions with Affiliates).  Subparagraph (a) of Section 6.11 of the Existing Credit Agreement shall be amended and restated to read in its entirety as follows:

 

“(a)                           Transactions with Affiliates.  The Borrowers will not, and will not cause or permit any of its Restricted Subsidiaries to, directly or indirectly, enter into or permit to exist any transaction or series of related transactions (including, without limitation, the purchase, sale, lease or exchange of any property or the rendering of any service) with, or for the benefit of, any of the 21C Entities, the Non-Covenant Party Stockholders and the Permitted Holders or any of their respective Affiliates other than the Covenant Parties (each, an “Internal Affiliate Transaction”) involving consideration in excess of $2,000,000 in the aggregate for all Internal Affiliate Transactions, until the repayment in full of the Obligations, other than Internal Affiliate Transactions that are (x) related to contracts with healthcare payers or supply agreements, in both cases entered into in the ordinary course of business and with terms at least as favorable to the Borrowers and its Restricted Subsidiaries as contracts and agreements in effect as of the Term A-1 Loan Effective Date; (y) (i) on terms that are no less favorable to the Term B Loan Borrower and its Restricted Subsidiaries than those that might reasonably have been obtained in a comparable transaction at such time on an arm’s length basis form a Person that is not an Affiliate of such Borrower or such Restricted Subsidiary, (ii) executed in the ordinary course of the Term B Loan Borrower’s or its Restricted Subsidiaries’ business, as applicable, and consistent with past 

 

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practices as described to the Lenders prior to the date of the First Amendment, and (iii) approved by the disinterested members of the Target’s Board of Directors, such approval to be evidenced by a Board Resolution stating that such Board of Directors has determined that such transaction complies with this Section 6.11, or (z) approved by the prior written consent of the Administrative Agent (as directed by the Required Lenders) and the Target.  It is understood and agreed that the sale or transfer of any Treatment Center shall not constitute a transaction entered into in the ordinary course of business.  Subject to Section 6.12, the transactions contemplated by the Intercompany Services Agreement will not be deemed Internal Affiliate Transactions and, therefore, the restrictions set forth in this Section 6.11(a) shall not apply to such transactions.”

 

2.17                        Amendment to Section 6.13 (Treatment Center Restrictions).  Section 6.13 of the Existing Credit Agreement shall be amended by amending the first sentence up to the first colon (“:”) as follows:

 

“Without limiting the generality of the restrictions set forth in Section 6.11, and subject to the provisions of such Section. the Borrowers will not, and will not cause or permit any Restricted Subsidiaries:”

 

2.18                        Amendments to Section 6.14 (Collateral Matters).

 

(a)                                 Subparagraph (c) of Section 6.14 of the Existing Credit Agreement shall be amended by deleting the last sentence of such Section.

 

(b)                                 Section 6.14 of the Existing Credit Agreement shall be amended by adding the following new subparagraph (d) at the end of such Section:

 

“(d)                           Notwithstanding Section 6.14(c), effective on and as of the Term A-2 Loan Effective Date (if it occurs), each Borrower shall:  (i) cause an amendment to the definition of the term “Article 9 Collateral” as defined in the Term A Loan Pledge and Security Agreement to be expanded to include all assets and properties of the Term A Loan Borrower, subject to certain exceptions to be agreed upon by the Collateral Agent; (ii) cause each Term A Loan Guarantor to grant in favor of the Collateral Agent a perfected first priority security interest and Lien in and to the assets and properties of such Term A Loan Guarantor, subject to certain exceptions to be agreed upon by the Collateral Agent, to secure its obligations under the Term A Loan Guarantee Agreement; and (iii) deliver to the Administrative Agent the certificates, if any, representing the shares of Capital Stock such Term A Loan Guarantor holds in any Subsidiary pledged pursuant to the Term A Pledge and Security Agreement, together with an undated stock power for each such certificate executed in blank by a duly authorized officer of such Term A Guarantor as the pledgor thereof; provided that the covenants described in clauses (ii) and (iii) above shall be operative only if the Comerica Loan Agreement is repaid in full.”

 

(c)                                  Section 6.14 of the Existing Credit Agreement shall be amended by adding the following new subparagraph (e) at the end of such Section:

 

“(e)                            In addition, notwithstanding anything to the contrary, the Required Lenders shall have the right, exercisable in their sole and absolute discretion on or prior to the Term A-2 Loan Outside Effective Date, to cause the Term A Loan 

 

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Borrower to refinance in full, or to cause the Term A Loan Borrower to cause any other Restricted Subsidiary to refinance in full, any Indebtedness of the Term A Loan Borrower or any such other Restricted Subsidiary, as applicable (other than the Obligations, “Other Indebtedness”), with proceeds of additional Term A-2 Loans to be made by the Term A Loan Lenders, if (i) the existence or incurrence of any such Other Indebtedness conflicts with, or results in a Default or Event of Default under, the terms of this Agreement or any other Loan Document, (ii) the terms of any of the Loan Documents, or the incurrence of any Obligations or Liens in favor of the Collateral Agent, conflicts with or results in a breach, default or event of default under, the terms of any documents governing any such Other Indebtedness, (iii) there is a then-existing breach, default or event of default under or with respect to any such Other Indebtedness; or (iv) if such Other Indebtedness is owing to Gulfstream Business Bank, KeyBank National Association or Seaside National Bank & Trust.  In the event that the Required Lenders exercise its rights under this Section 6.14(e) with respect to any Other Indebtedness, the Term A Loan Borrower shall, or shall cause any such other Restricted Subsidiary to, cooperate timely with the Required Lenders to refinance any such Other Indebtedness and use its best efforts to cause such Other Indebtedness to be refinanced in full as directed by the Required Lenders.”

 

2.19                        Amendments to Section 7 (Events of Default).

 

(a)                                 Subparagraph (d) of Section 7 of the Existing Credit Agreement shall be amended and restated to read in its entirety as follows:

 

“(d)                           the failure to pay at final maturity (giving effect to any applicable grace periods and any extensions thereof) the stated principal amount of any Borrower Group Material Indebtedness, or any other default under any agreement or instrument relating to any such Indebtedness (and, in the case of any such default on Closing Date Consent Indebtedness occurring solely due to the Transactions, such default continues after the earlier to occur of the Term A-2 Loan Effective Date and the Term A-2 Loan Outside Effective Date (unless such time period is extended with the consent of the Required Lenders)), or any other event, shall occur (and shall continue after the applicable grace period, if any, specified in such agreement or instrument), if the effect of such default or event is to accelerate, or to permit the acceleration of, the maturity of such Indebtedness, or the acceleration of the final stated maturity of any such Indebtedness (which acceleration, if notice of such acceleration is given, is not rescinded, annulled or otherwise cured within 30 days of receipt by a Borrower or such Restricted Subsidiary of such notice), if the aggregate principal amount of such Indebtedness, together with the principal amount of any other such Indebtedness in default for failure to pay principal at final stated maturity or which has been accelerated (in each case with respect to which the 30 day period described above has elapsed), aggregates $1,000,000 or more at any time; or”

 

(b)                                 Subparagraph (e) of Section 7 of the Existing Credit Agreement shall be amended and restated to read in its entirety as follows:

 

“(e)                            the failure to pay at final maturity (giving effect to any applicable grace periods and any extensions thereof) the stated principal amount of any 21C Group Material Indebtedness, or any other default or event of default under any agreement or instrument relating to any such Indebtedness, or any other event, shall occur (and shall continue after the applicable grace period, if any, specified in such 

 

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agreement or instrument), if the effect of such failure, default or event of default is to (i) accelerate the maturity of such Indebtedness or (ii) permit the acceleration of the maturity of such Indebtedness and, in the case of this clause (ii) and if notice of such failure, default or event of default is given, such failure, default or event of default shall not have been waived or cured (if curable) within 30 days of receipt by a Borrower or any Restricted Subsidiary of such notice; or”

 

(c)                                  Subparagraph (g) of Section 7 of the Existing Credit Agreement shall be amended and restated in its entirety as follows:

 

“(g)                            any Covenant Party shall (i) default in making any payment of any principal of any Indebtedness (including any Guarantee Obligation, but excluding the Obligations) on any scheduled or original due date with respect thereto after giving effect to applicable cure periods and consents and waivers obtained during such cure periods; or (ii) default in making any payment of any interest on any such Indebtedness (excluding the Obligations), beyond the period of grace, if any, provided in the instrument or agreement under which such Indebtedness was created and such default has not been cured or waived; or (iii) default in the observance or performance of any other agreement or condition relating to any such Indebtedness or contained in any instrument or agreement evidencing, securing or relating thereto (and, in the case of any such default on Closing Date Consent Indebtedness occurring solely due to the Transactions, such default continues after the earlier to occur of the Term A-2 Loan Effective Date and the Term A-2 Loan Outside Effective Date (unless such time period is extended with the consent of the Required Lenders)), or any other event shall occur or condition exist, the effect of which default or other event or condition after giving effect to applicable cure periods and consents and waivers obtained during such cure periods is to cause, or to permit the holder or beneficiary of such Indebtedness (or a trustee or agent on behalf of such holder or beneficiary) to cause, with the giving of notice if required, such Indebtedness to become due prior to its stated maturity or (in the case of any such Indebtedness constituting a Guarantee Obligation) to become payable and such default has not been waived; provided that a default, event or condition described in clause (i), (ii) or (iii) of this paragraph (g) (other than a default with respect to Closing Date Consent Indebtedness) shall not at any time constitute an Event of Default unless, at such time, one or more defaults, events or conditions of the type described in clauses (i), (ii) and (iii) of this paragraph (g) shall have occurred and be continuing with respect to Indebtedness the outstanding principal amount of which exceeds in the aggregate $1,000,000; or”

 

2.20                        Amendment to Section 9.6 (Successors and Assigns; Participations and Assignments).  The first sentence of subparagraph (d) of Section 9.6 of the Existing Credit Agreement, before the semi-colon (“;”), shall be amended to read in its entirety as follows:

 

“Any Lender may, without the consent of the Borrowers or the Administrative Agent, sell participations to one or more banks or other entities or any natural Persons who, in each case, is both an Affiliate of any Borrower and an “accredited investor” (as defined in Rule 501 promulgated under the Securities Act of 1933, as amended) (in each case a “Participant”) in all or a portion of such Lender’s rights and obligations under this Agreement and the other Loan Documents (including all or a portion of its Commitments and the Loans owing to it);”

 

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2.21                        Amendment to Schedule 1.1A (Term A Loan Commitments).  Schedule 1.1A to the Existing Credit Agreement shall be amended and restated to read in its entirety as provided in Schedule 1.1A (Amended) to this Amendment.

 

2.22                        Updated Schedules.  In addition to the amendment of Schedule 1.1A to the Existing Credit Agreement as provided in Section 2.21 above, the Schedules attached to this Amendment shall amend, restate, update and replace the corresponding Schedule attached to the Existing Credit Agreement; provided, however, for purposes of the representations and warranties set forth in clause (c) in Section 4.1 (Financial Condition) (including the Indebtedness on Schedule 6.6(c) referenced therein), Section 4.8 (Ownership of Property; Liens), Section 4.16 (Capitalization; Subsidiaries), Section 4.24 (Related Party Transactions) and Section 4.25 (Insurance) to which the Schedules attached to this Amendment relate, references to “Closing Date,” “Closing Date immediately after the Closing Date Acquisition” or words of similar import, when used therein, respectively, shall be deemed to refer to the “Term A-1 Loan Effective Date.”

 

SECTION 3.
 CONDITIONS TO EFFECTIVENESS

 

The obligations of the Term A Loan Lenders to make the Term A-1 Loans to the Term A Loan Borrower shall be subject to the satisfaction of each of the following conditions precedent in the sole discretion of the Administrative Agent (unless waived by the Required Lenders) (the date of the satisfaction of all such conditions being referred to herein as the “Term A-1 Loan Effective Date”):

 

3.1                               Outside Effective Date.  The last of the conditions precedent set forth in this Section 3 to be satisfied shall be satisfied not later than 3:00 p.m. (Los Angeles time) on July 22, 2014.

 

3.2                               Borrowing Notice.  The Administrative Agent shall have received a Borrowing Notice pursuant to Section 2.2 of the Credit Agreement, duly executed by the Term A Loan Borrower, with respect to the Term A-1 Loans, accompanied by a Term A-1 Loans flow of funds chart approved by the Lenders.

 

3.3                               Fees and Expenses.  The Term A Loan Borrower shall have paid (or reimbursed the Lenders and the Agents for) (i) a non-refundable up-front fee in cash in the amount of four percent (4.00%) of the aggregate principal amount of the Term A-1 Loans (the “Term A-1 Loan Upfront Fee”) and (ii) all fees, costs and expenses incurred by the Lenders and the Administrative Agent in connection with this Amendment and the transactions contemplated hereby as provided in Section 5.3 of the First Amendment.  The parties agree that the Term A-1 Loan Upfront Fee shall be deemed fully earned as of the Term A-1 Loan Effective Date.  The parties further agree that the Term A-1 Loan Upfront Fee and such fees, costs and expenses shall be paid with (and may be withheld by the Lenders and the Administrative Agent from) the gross proceeds of the Term A-1 Loans made on the Term A-1 Loan Effective Date and will be reflected in the funding instructions given by the Borrowers to the Administrative Agent on or before the Term A-1 Loan Effective Date.  The parties further agree that, notwithstanding anything to the contrary herein, the payment of the Term A-1 Loan Upfront Fee shall be treated for federal, state and local income tax purposes as a reduction to the issue price of the Term A-1 Loans pursuant to the principles of Section 1.1273-2(g)(2) of the Treasury Regulations and, accordingly, for purposes of Section 1271 et seq. of the Code, the original issue price of the Term A-1 Loans will be 96.00% of their gross principal amount.

 

3.4                               Term A-1 Loan Documents.  The Administrative Agent shall have received the following documents, each dated as of the Term A-1 Loan Effective Date (unless otherwise indicated herein) (collectively, including this Amendment, the “Term A-1 Loan Documents”):

 

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(a)                                 First Amendment.  This Amendment, duly executed by the Borrowers, together with all Schedules and Exhibits.

 

(b)                                 Acknowledgment and Consent of Term A Loan Guarantors.  An Acknowledgment and Consent, in substantially the form attached as Exhibit D, duly executed by each Term A Loan Guarantor.

 

(c)                                  Acknowledgment and Consent of Term B Loan Guarantors.  An Acknowledgment and Consent, in substantially the form attached as Exhibit E, duly executed by each Term B Loan Guarantor.

 

(d)                                 Acknowledgment and Reaffirmation of Subordinated Borrowers (Borrower Group).  An Acknowledgment and Reaffirmation, in substantially the form attached as Exhibit F, duly executed by each Subordinated borrower under the Borrower Group Intercompany Note and Subordination Agreement.

 

(e)                                  Acknowledgment and Reaffirmation of Subordinated Borrowers (21C Group / Borrower Group).  An Acknowledgment and Reaffirmation, in substantially the form attached as Exhibit G, duly executed by each Subordinated borrower under the 21C Group / Borrower Group Intercompany Note and Subordination Agreement.

 

(f)                                   Joinder Agreement to Guaranty.  A Joinder Agreement to Guaranty, in substantially the form attached to the Term A Loan Guarantee Agreement, for each of Treasure Coast Medicine, Treasure Coast Radiation Oncology, LLC and Boca Oncology Partners, LLC, duly executed by Treasure Coast Medicine, Treasure Coast Radiation Oncology, LLC and Boca Oncology Partners, LLC, as the case may be.

 

(g)                                  Supplement No. 1 to Borrower Group Intercompany Subordination Agreement.  A Supplement No. 1 to the Borrower Group Intercompany Subordination Agreement, in form and substance satisfactory to the Administrative Agent, duly executed by Treasure Coast Radiation Oncology, LLC.

 

(h)                                 Counterpart Signature Page to Intercompany Subordinated Demand Promissory Note (Borrower Group).  A counterpart signature page to the Intercompany Subordinated Demand Promissory Note (Borrower Group), in form and substance satisfactory to the Administrative Agent, duly executed by Treasure Coast Radiation Oncology, LLC.

 

(i)                                     Supplement No. 1 to 21C Group/Borrower Group Intercompany Subordination Agreement.  A Supplement No. 1 to the 21C Group / Borrower Group Intercompany Subordination Agreement, in form and substance satisfactory to the Administrative Agent, duly executed by Treasure Coast Radiation Oncology, LLC.

 

(j)                                    Counterpart Signature Page to Intercompany Subordinated Demand Promissory Note (21C Group/Borrower Group).  A counterpart signature page to the Intercompany Subordinated Demand Promissory Note (21C Group/Borrower Group), in form and substance satisfactory to the Administrative Agent, duly executed by Treasure Coast Radiation Oncology, LLC.

 

(k)                                 Supplement No. 2 to Borrower Group Intercompany Subordination Agreement.  A Supplement No. 2 to the Borrower Group Intercompany Subordination Agreement, in form and substance satisfactory to the Administrative Agent, duly executed by Boca Oncology Partners, LLC.

 

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(l)                                     Counterpart Signature Page to Intercompany Subordinated Demand Promissory Note (Borrower Group).  A counterpart signature page to the Intercompany Subordinated Demand Promissory Note (Borrower Group), in form and substance satisfactory to the Administrative Agent, duly executed by Boca Oncology Partners, LLC.

 

(m)                             Supplement No. 2 to 21C Group/Borrower Group Intercompany Subordination Agreement.  A Supplement No. 2 to the 21C Group / Borrower Group Intercompany Subordination Agreement, in form and substance satisfactory to the Administrative Agent, duly executed by Boca Oncology Partners, LLC.

 

(n)                                 Counterpart Signature Page to Intercompany Subordinated Demand Promissory Note (21C Group/Borrower Group).  A counterpart signature page to the Intercompany Subordinated Demand Promissory Note (21C Group/Borrower Group), in form and substance satisfactory to the Administrative Agent, duly executed by Boca Oncology Partners, LLC.

 

3.5                               Target Seller Participation Interests.

 

(a)                                 The Administrative Agent shall have received:

 

(i)                                     A Target Seller Participation Agreement dated as of the Term A-1 Loan Effective Date, duly executed by Rajiv Patel, for each Term A Loan Lender with a Term A-1 Loan Commitment;

 

(ii)                                  A Target Seller Participation Agreement dated as of the Term A-1 Loan Effective Date, duly executed by Kishore Dass, for each Term A Loan Lender with a Term A-1 Loan Commitment; and

 

(iii)                               A Target Seller Participation Agreement dated as of the Term A-1 Loan Effective Date, duly executed by Ben Han, for each Term A Loan Lender with a Term A-1 Loan Commitment.

 

(b)                                 Each Target Seller shall have paid the Participation Interest Purchase Price (as defined in each Target Seller Participation Agreement) for the Target Seller Participation Interest sold to him by the relevant Principal (as defined in each Target Seller Participation Agreement) as provided in the relevant Target Seller Participation Agreement.

 

3.6                               First Financial Payoff Letter.  The Administrative Agent shall have received a payoff letter and equipment purchase and sale documentation, in form and substance satisfactory to the Administrative Agent, duly executed by First Financial Corporate Leasing.

 

3.7                               Certain Waivers.  The Administrative Agent shall have received a consent, in form and substance satisfactory to the Administrative Agent, executed by Seaside National Bank & Trust consenting to the Transactions.

 

3.8                               [Reserved.]

 

3.9                               [Reserved.]

 

3.10                        Borrowers’ Certificate.  The Administrative Agent shall have received a certificate of the vice president of the Term B Loan Borrower and an authorized signatory of the Term A Loan Borrower, duly executed and dated the Term A-1 Loan Effective Date, certifying that:  (a) after giving effect to the amended Schedules attached to this Amendment, each of the representations and

 

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warranties made by the Borrowers in or pursuant to this Amendment shall be true and correct in all material respects (other than representations and warranties that are qualified by materiality, which representations and warranties shall be true and correct in all respects) on and as of such date, as if made on and as of such date (other than representations and warranties which speak only as of a certain date, which representations and warranties shall be made only on such date; provided, however, that for purposes of the representations and warranties set forth in clause (c) in Section 4.1 (Financial Condition) (including the Indebtedness on Schedule 6.6(c) referenced therein), Section 4.8 (Ownership of Property; Liens), Section 4.16 (Capitalization; Subsidiaries), Section 4.24 (Related Party Transactions) and Section 4.25 (Insurance), references to “Closing Date,” “Closing Date immediately after the Closing Date Acquisition” or words of similar import, when used therein, respectively, shall be deemed to refer to the Term A-1 Loan Effective Date), and (b) each of the other conditions precedent set forth in this Section 3 has been satisfied and fulfilled.

 

3.11                        Lien Searches.  The Lenders and Administrative Agent shall have received the results of a recent lien search (including a search as to UCC and judgment matters) for the Term A Loan Borrower and the other Restricted Subsidiaries (other than South Florida Medicine, LLC and its Restricted Subsidiaries) in each of the jurisdictions where the Term A Loan Borrower or any of the other Restricted Subsidiaries (other than South Florida Medicine, LLC and its Restricted Subsidiaries) is organized or where assets of the Term A Loan Borrower or any of the other Restricted Subsidiaries(other than South Florida Medicine, LLC and its Restricted Subsidiaries) is located, and such search shall reveal no Liens on any of the assets of the Term A Loan Borrower or any of the other Restricted Subsidiaries (other than South Florida Medicine, LLC and its Restricted Subsidiaries), except for Liens permitted by Section 6.8 of the Existing Credit Agreement or discharged on or prior to the Term A-1 Loan Effective Date.

 

3.12                        Legal Opinions.  The Administrative Agent shall have received the executed legal opinions of:

 

(a)                                 Kirkland & Ellis LLP, counsel to the Borrowers, addressed to the Lenders and in form and substance satisfactory to the Required Lenders; and

 

(b)                                 Holland & Knight LLP, special Florida counsel to the Term A Loan Borrower and special counsel in Florida, addressed to the Lenders and in form and substance satisfactory to the Required Lenders.

 

3.13                        Consents and Approvals.  All requisite Governmental Authorities and other third parties shall have approved of or consented to the execution, delivery and performance by the Borrowers and the other Covenant Parties of this Amendment and the other Term A-1 Loan Documents, and the Administrative Agent shall have received true, correct and complete copies of all such approvals and consents.

 

3.14                        Organizational Documents.  The Administrative Agent shall have received:

 

(a)                                 a certificate of the Secretary or another executive officer of each of the Term A Loan Borrower and the Term B Loan Borrower dated the Term A-1 Loan Effective Date certifying (i) that each of the organizational documents of each of the Term A Loan Borrower and the Term B Loan Borrower, its Subsidiaries and the Term A Loan Guarantors and the Term B Loan Guarantors delivered to the Administrative Agent on the Closing Date have not been amended since the Closing Date and remains in full force and effect; (ii) that the agreement of limited partnership, operating agreement or by-laws of each of the Term A Loan Borrower and the Term B Loan Borrower and each of their respective Subsidiaries, as applicable, as in effect on the Closing Date have not been amended since the Closing Date and remains in full force and effect; (iii) that attached thereto is a true and

 

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complete copy of resolutions duly adopted by the Board of Directors of each of the Term A Loan Borrower and the Term B Loan Borrower and the Term A Loan Guarantors authorizing the execution, delivery and performance of this Amendment and each of the Term A-1 Loan Documents to which it is to be a party and, in the case of the Term A Loan Borrower, the borrowings hereunder, and that such resolutions have not been modified, rescinded or amended and are in full force and effect; and (iv) as to the incumbency and specimen signature of each officer executing any Term A-1 Loan Document;

 

(b)                                 a certificate of the Secretary or another executive officer of the Term A Loan Guarantors, dated the Term A-1 Loan Effective Date and certifying (A) that attached thereto is a true and complete copy of resolutions duly adopted by the Board of Directors of the Term A Loan Guarantors authorizing the execution, delivery and performance of any of the Term A-1 Loan Documents to which it is to be a party, and that such resolutions have not been modified, rescinded or amended and are in full force and effect; and (B) as to the incumbency and specimen signature of each officer of a Term A Loan Guarantor executing any Term A-1 Loan Document;

 

(c)                                  a certificate of another officer as to the incumbency and specimen signature of the Secretary or other officer executing the certificate pursuant to clauses (a) and (b) above;

 

(d)                                 long form good standing certificates and bring-down good standing certificates of each of the Term A Loan Borrower, the Term B Loan Borrower and the Term A Loan Guarantors in their respective jurisdictions of incorporation or formation, as applicable; and

 

(e)                                  (i) a copy of the organizational documents, including all amendments thereto, of Treasure Coast Medicine, certified by the Secretary of State or other applicable Governmental Authority of its respective jurisdiction of organization; (ii) a copy of the organizational documents, including all amendments thereto, of Treasure Coast Radiology Oncology, LLC; (iii) a copy of the organizational documents, including all amendments thereto, of Boca Oncology Partners, LLC; and (iv) a certificate of the Secretary or another officer of each of Treasure Coast Medicine, Treasure Coast Radiology Oncology, LLC and Boca Oncology Partners, LLC, dated the Term A-1 Loan Effective Date and certifying (A) that the organizational documents of each of Treasure Coast Medicine, Treasure Coast Radiology Oncology, LLC and Boca Oncology Partners, LLC, as the case may be, have not been amended since the date of the last amendment thereto shown on the certificate of good standing from its jurisdiction of organization furnished pursuant to the applicable clauses above and remain in full force and effect; (B) that attached thereto is a true and complete copy of the agreement of limited partnership, operating agreement or by-laws of each of Treasure Coast Medicine, Treasure Coast Radiology Oncology, LLC and Boca Oncology Partners, LLC, as applicable, as in effect on the Term A-1 Effective Date and at all times since a date prior to the date of the resolutions described in clause (C) below or certifying that such by-laws, limited partnership agreement or operating agreement has not been amended; (C) that attached thereto is a true and complete copy of resolutions duly adopted by the Board of Directors of each of Treasure Coast Medicine, Treasure Coast Radiology Oncology, LLC and Boca Oncology Partners, LLC, authorizing the execution, delivery and performance of the Loan Documents to which it is to be a party and that such resolutions have not been modified, rescinded or amended and are in full force and effect; and (D) as to the incumbency and specimen signature of each such officer executing any Loan Document.

 

3.15                        No Legal Prohibition.  None of the transactions to be consummated on the Term A-1 Loan Effective Date shall be prohibited by or violate any Requirements of Law or subject any party to any Tax, penalty or liability under or pursuant to any Requirement of Law.

 

3.16                        Other Lender Requests.  Each Borrower shall, and shall cause the Restricted Subsidiaries to, have executed and delivered to the Administrative Agent such other documents, in form

 

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and substance reasonably satisfactory to the Administrative Agent and the Lenders, as the Administrative Agent or the Lenders may request.

 

SECTION 4.
 REPRESENTATIONS AND WARRANTIES

 

In order to induce the Lenders and the Administrative Agents to, among other things, enter into this Amendment, make the Term A-1 Term Loan, waive the First Amendment Specified Defaults effective as of the Term A-1 Loan Effective Date, waive the Waived First Amendment Specified Default Interest effective as of the Term A-1 Loan Effective Date, waive the Suspended First Amendment Specified Default Interest effective as of the Term A-2 Loan Effective Date (if it occurs) as expressly provided herein and consummate the other transactions contemplated hereby, the Borrowers hereby represent and warrant to each of the Lenders and the Agents that:

 

4.1                               Power; Authorization; Enforceable Obligations.

 

(a)                                 Each of the Borrowers and the Guarantors has the corporate or other organizational power and authority to make, deliver and perform its obligations under each Term A-1 Loan Document to which it is a party and, in the case of the Borrowers, to obtain extensions of credit hereunder.

 

(b)                                 Each of the Borrowers and the Guarantors has taken all necessary organizational action to authorize the execution, delivery and performance of each of the Term A-1 Loan Documents to which it is a party, the consummation of each of the transactions contemplated hereby and thereby to which it is a party, and, in the case of the Borrowers, to authorize the extensions of credit on the terms and conditions of this Amendment.

 

(c)                                  No consent or authorization of, filing with, notice to or other act by or in respect of, any Governmental Authority is required in connection with the execution, delivery or performance by any Borrower or Guarantor of this Amendment or any other Term A-1 Loan Document.

 

(d)                                 Each Term A-1 Loan Document has been duly executed and delivered on behalf of the Borrowers and each Guarantor party thereto.

 

(e)                                  This Amendment constitutes, each other Term A-1 Loan Document, upon execution, will constitute, a legal, valid and binding obligation of each of the Borrowers and each Guarantor party thereto, enforceable against each of the Borrower and each such Guarantor in accordance with its terms, subject to 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) and an implied covenant of good faith and fair dealing.

 

4.2                               No Legal Bar or Contractual Obligation Violation.  The execution and delivery of this Amendment and the other Term A-1 Loan Documents, and the consummation of the transactions contemplated hereby and thereby, will not (i) conflict with, result in a breach of or constitute (alone or with notice or lapse of time or both) a default under, or give rise to any right to accelerate or to require the prepayment, repurchase or redemption of any obligation under any of the Borrower Group Material Indebtedness or the 21C Group Material Indebtedness, (ii) violate in any material respect any Requirement of Law or any Contractual Obligation of the Covenant Parties or the 21C Guarantors, where such violation or default could reasonably be expected to result in a Material Adverse Effect, (iii) will not result in, or require, the creation or imposition of any material Lien on any of their respective

 

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properties or revenues (other than the Liens created by the Security Documents), pursuant to any Requirement of Law or any such Contractual Obligation that could reasonably be expected to result in a Material Adverse Effect or (iv) conflict with or result in a breach of any of the terms or requirements of, or give any Governmental Authority to right to revoke, withdraw, suspend, cancel, terminate or modify, any material permit, license, certificate, authorization or waiver that is held by or on behalf of the Parent or its Subsidiaries or any Covenant Party where such conflict or breach could reasonably be expected to result in a Material Adverse Effect.

 

4.3                               No Default.  After giving effect to the limited waiver of the First Amendment Specified Defaults in this Amendment, no Default or Event of Default has occurred and is continuing or will occur as a result of the execution, delivery or performance of this Amendment or the other Term A-1 Loan Documents or the consummation of the transactions contemplated hereby or thereby.

 

4.4                               Existing Loans.  As of the date of this Amendment, the aggregate principal balance of the Term A Loans made to the Term A Loan Borrower on the Closing Date is $7,900,000.00, and the aggregate principal balance of the Term B Loans, excluding any interest that was due and payable on July 15, 2014 and paid in the form of a PIK Interest Payment, is $60,000,000.00.

 

4.5                               Collateral Security.  The Liens granted in favor of the Secured Parties under each Security Document purporting to grant such Liens constitute valid, enforceable, perfected and continuing security interests and Liens in, on and to the Collateral described therein to secure the payment and performance in full of all Secured Obligations (as such term is defined therein, respectively).

 

4.6                               Use of Term A-1 Loan Proceeds.  The proceeds of the Term A-1 Loans shall be used by the Term A Loan Borrower solely to (a) refinance existing Capitalized Lease Obligations owing to First Financial Corporate Leasing in the aggregate amount (inclusive of all amounts owed, including prepayment premium) of $5,642,181.68, (b) repay the intercompany loan made by 21C to the Term A Loan Borrower to pay the Capitalized Lease Obligations owing to First Financial Corporate Leasing in the aggregate amount of $2,550,636 and (c) pay the fees, costs and expenses of the transactions related thereto and contemplated hereby to be consummated on the Term A-1 Loan Effective Date.

 

4.7                               No Material Adverse Effect.  Since February 10, 2014, no Material Adverse Effect shall have occurred, except as otherwise waived by the Requisite Lenders in writing and the potential of a 21C Filing Event, or will occur as a result of the execution or delivery of this Amendment or any other Term A-1 Loan Document, the borrowing of the Term A-1 Loans or the consummation of the other transactions contemplated hereby or thereby.

 

4.8                               Status of Post-Closing Tasks.  (a) Each of the consents, authorizations, filings and notices listed on Schedule 4.4 to the Existing Credit Agreement has been duly filed, submitted, obtained or made as provided therein; (b) each Borrower has used, and is continuing to use, its commercially reasonable best efforts to perform each of its obligations under Section 6.14(c)(i) through (v) therein; and (c) the Borrowers have performed each of the Post-Closing Requirements listed on Schedule 6.18 other than the Post-Closing Requirements described in clauses (f) and (g) thereof.  The Term B Loan Borrower does not maintain any Deposit Accounts (as defined in the Term B Loan Pledge and Security Agreement).

 

4.9                               Incorporation of Representations and Warranties from Existing Credit Agreement.  After giving effect to the amended Schedules attached to this Amendment, the representations and warranties contained in Section 4 of the Existing Credit Agreement (other than the representations and warranties contained in Sections 4.4, 4.7, 4.17 and 4.21) are, and will on and as of the Term A-1 Loan Effective Date be, true and correct in all material respects (but in all respects if such representation or

 

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warranty is qualified by “materiality” or “Material Adverse Effect”) to the same extent as though made on and as of that date, except to the extent such representations and warranties specifically relate to an earlier date, in which case they were true and correct in all material respects on and as of such earlier date; provided, however, that for purposes of the representations and warranties set forth in clause (c) in Section 4.1 (Financial Condition) (including the Indebtedness on Schedule 6.6(c) referenced therein), Section 4.8 (Ownership of Property; Liens), Section 4.16 (Capitalization; Subsidiaries), Section 4.24 (Related Party Transactions) and Section 4.25 (Insurance), references to “Closing Date,” “Closing Date immediately after the Closing Date Acquisition” or words of similar import, when used therein, respectively, shall be deemed to refer to the “Term A-1 Loan Effective Date.”

 

4.10                        Outstanding Indebtedness.  As of June 30, 2014, the aggregate principal amount of all outstanding Indebtedness of Target and the other Restricted Subsidiaries, excluding all Term A Loans made to the Term A Loan Borrower in the aggregate principal amount of $17,500,000, was approximately $25,700,000.

 

4.11                        Solvency.  Target and its Subsidiaries (including the Term A Loan Borrower and the other Restricted Subsidiaries) taken as a whole are, and immediately following the funding of the Term A-1 Loans and the incurrence of all of their obligations under this Amendment and the other First Amendment Loan Documents on the Term A-1 Loan Effective Date will be, Solvent, subject to the possible adverse impact on Target and its Subsidiaries of (a) a default or event of default under the promissory notes issued by Treasure Coast Radiation Oncology, LLC in favor of Seaside National Bank & Trust existing on the date of this Amendment or (b) an Event of Default, in each case solely as a result of a 21C Filing Event.

 

4.12                        Financial Statements.

 

(a)                                 The audited consolidated balance sheet of Parent and its Subsidiaries as at December 31, 2013 and the related audited consolidated statements of income and of cash flows for the fiscal year then ended, reported on by and accompanied by an unqualified report from Ernst & Young LLP, present fairly in all material respects the consolidated financial condition of Parent and its Subsidiaries as at such date, and the consolidated results of its operations and its consolidated cash flows for the fiscal year then ended.  All such financial statements, including the related schedules and notes thereto, have been prepared in accordance with GAAP applied consistently throughout the periods involved (except as approved by the aforementioned firm of accountants and disclosed therein).

 

(b)                                 To the knowledge of the Borrowers, the audited consolidated balance sheets of Target and its Subsidiaries as at December 31, 2012 and December 31, 2013, and the related audited consolidated statements of income and of cash flows for the fiscal years then ended, reported on by and accompanied by an unqualified report from Moore Stephens Lovelace, P.A., present fairly in all material respects the consolidated financial condition of Target and its Subsidiaries as at such dates, and the consolidated results of its operations and its consolidated cash flows for the respective fiscal years then ended.  All such financial statements, including the related schedules and notes thereto, have been prepared in accordance with GAAP applied consistently throughout the periods involved (except as approved by the aforementioned firm of accountants and disclosed therein).

 

SECTION 5.
 COVENANTS AND AGREEMENTS

 

5.1                               Cooperation.  In connection with any due diligence investigation conducted by the Lenders or the Agents, the Borrowers shall, and shall cause the other Covenant Parties and their other Affiliates to, provide full and complete access to all books, records, accounts, documents, information and facilities and matters of importance relating to the business, finances, operations and affairs of the

 

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Borrowers and their Affiliates as the Lenders or the Agents may request and shall, and shall cause the other Covenant Parties and their other Affiliates to, cooperate with such due diligence investigation on a timely basis.

 

5.2                               Release.  The Borrowers hereby acknowledges and agrees that:  (a) neither it nor any of its Affiliates (including the other Covenant Parties and the 21C Entities) has any claim or cause of action against any Agent or any Lender (or any of their respective Affiliates, officers, directors, employees, attorneys, consultants or agents) under the Existing Credit Agreement or any other Loan Document and (b) each Agent and each Lender has heretofore properly performed and satisfied in a timely manner all of its obligations to the Borrowers and the other Covenant Parties under the Existing Credit Agreement and the other Loan Documents.  Notwithstanding the foregoing, the Agents and the Lenders wish (and the Borrowers agree) to eliminate any possibility that any past conditions, acts, omissions, events or circumstances would impair or otherwise adversely affect any of the Agents’ and the Lenders’ rights, interests, security and/or remedies under the Existing Credit Agreement and the other Loan Documents.  Accordingly, for and in consideration of the agreements contained in this Amendment and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, each Borrower (for itself and its Affiliates, including the other Covenant Parties and the 21C Entities, and the successors, assigns, heirs and representatives of each of the foregoing) (collectively, the “Releasors”) does hereby fully, finally, unconditionally and irrevocably release and forever discharge each Agent, each Lender and each of their respective Affiliates, officers, directors, employees, attorneys, consultants and agents (collectively, the “Released Parties”) from any and all debts, claims, obligations, damages, costs, attorneys’ fees, suits, demands, liabilities, actions, proceedings and causes of action, in each case, whether known or unknown, contingent or fixed, direct or indirect, and of whatever nature or description, and whether in law or in equity, under contract, tort, statute or otherwise, which any Releasor has heretofore had or now or hereafter can, shall or may have against any Released Party by reason of any act, omission or thing whatsoever done or omitted to be done on or prior to the Term A-1 Loan Effective Date arising out of, connected with or related in any way to this Amendment, the Existing Credit Agreement or any other Loan Document, or any act, event or transaction related or attendant thereto, or the agreements of any Agent or any Lender contained therein, or the possession, use, operation or control of any of the assets of the Borrowers, or the making of any Loans or other advances, or the management of such Loans or advances or the Collateral on or prior to the Term A-1 Loan Effective Date.

 

5.3                               Reimbursement of Fees and Expenses.  Notwithstanding anything to the contrary, whether or not the Term A-1 Loan Effective Date or Term A-2 Loan Effective Date occurs, the Term A Loan Borrower agrees to pay or reimburse each of the Lenders and the Agents for all fees, costs and expenses incurred by any such Lenders and Agents prior to the earlier of the Term A-2 Loan Effective Date or the Term A-2 Loan Outside Effective Date in connection with the negotiation, execution and delivery of this Amendment and any agreements, term sheets or other documents contemplated hereby or related hereto and the consummation of transactions contemplated hereby and thereby, including, but not limited to, the borrowing of the Term A-1 Loans and the Term A-2 Loans (if it occurs) and any due diligence investigation of the Borrower and their subsidiaries and other Affiliates performed by or on behalf of the Lenders or the Agents; provided, however, that subject to Section 9.5(a) of the Amended Credit Agreement, in no event shall the Borrowers be obligated to reimburse the reasonable expenses of more than one counsel and one financial advisor for the Lenders pursuant to this Section 5.3).

 

5.4                               Treatment of Unamortized Funding Discounts.  The parties acknowledge and agree that, as of the Term A-1 Loan Effective Date, the unamortized portion of each of the Term A Funding Discount and the Term B Funding Discount shall be treated as fully earned on and as of the Term A-1 Loan Effective Date as consideration for the Lenders’ willingness to enter into this Amendment and consummate the transactions contemplated hereby (including, among other things, waiving the First

 

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Amendment Specified Defaults effective as of the Term A-1 Loan Effective Date, waiving the Waived First Amendment Specified Default Interest effective as of the Term A-1 Loan Effective Date, waiving the Suspended First Amendment Specified Default Interest effective as of the Term A-2 Loan Effective Date (if it occurs) as expressly provided herein and amending the provisions of the Existing Credit Agreement), and, subject to Section 2.4, each such party shall not take any position inconsistent with such treatment.

 

SECTION 6.
 MISCELLANEOUS

 

6.1                               Reference to and Effect on Existing Credit Agreement and the Other Loan Documents.  Each of this Amendment and the other Term A-1 Loan Documents shall constitute a Loan Document on and after the Term A-1 Loan Effective Date, each reference in the Existing Credit Agreement to “this Agreement”, “hereunder”, “hereof”, “herein” or words of like import referring to the Existing Credit Agreement, and each reference in the other Loan Documents to the “Credit Agreement” to “thereunder”, “thereof” or words of like import referring to the Existing Credit Agreement shall mean and be a reference to the Amended Credit Agreement.

 

6.2                               Confirmation; Full Force and Effect.  The amendments set forth in this Amendment shall amend the Existing Credit Agreement on and as of the Term A-1 Loan Effective Date, and the Existing Credit Agreement shall otherwise remain in full force and effect, as amended thereby, from and after the Term A-1 Loan Effective Date in accordance with its terms.  The Borrowers hereby ratify, approve and reaffirm in all respects the Existing Credit Agreement, as amended by this Amendment, and the other Loan Documents, the terms and other provisions hereof and thereof and the Obligations thereunder.  The execution, delivery and performance of this Amendment shall not constitute a waiver of any provision of, or operate as a waiver of any right, power or remedy of, the Lenders or the Agents under the Amended Credit Agreement or any other Loan Document, or a forbearance by the Lenders or the Agents on the exercise of any rights, remedies or powers against the Borrowers, the Guarantors or the Collateral.  The Lenders and the Agents hereby expressly reserves all of its rights, powers and remedies under or in connection with the Amended Credit Agreement and the other Loan Documents, whether at law or in equity, including the right to declare all Obligations to be due and payable.

 

(a)                                 Entire Agreement; Successors and Assigns.  This Amendment, the other Term A-1 Loan Documents and the other documents being delivered in connection herewith constitute the entire understanding and agreement among the parties with respect to the subject matter hereof and supersede all prior oral and written, and all contemporaneous oral, agreements, negotiations, discussions and understandings among them with respect thereto.  This Amendment shall inure to the benefit of, and be binding upon, the parties and their respective successors and permitted assigns.

 

(b)                                 Governing Law.  IN ALL RESPECTS, INCLUDING ALL MATTERS OF CONSTRUCTION, VALIDITY AND PERFORMANCE, THIS AMENDMENT SHALL BE GOVERNED BY, AND CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF NEW YORK (WITHOUT REGARD TO THE CHOICE OF LAW OR CONFLICTS OF LAW PRINCIPLES).

 

(c)                                  Counterparts.  This Amendment may be executed in one or more counterparts (and by different parties on different counterparts), each of which shall constitute an original, but all of which when taken together shall constitute a single contract.  Delivery of an executed counterpart of a signature page of this Amendment by facsimile transmission or in electronic (e.g., “pdf” or “tif”) format shall be as effective as delivery of a manually signed counterpart of this Amendment.

 

30

 

IN WITNESS WHEREOF, the parties have duly executed this Amendment as of the date first written above.

 

	
 
    	
TERM   A LOAN BORROWER:
    
	
 
    	
 
    
	
 
    	
SOUTH   FLORIDA RADIATION ONCOLOGY COCONUT CREEK, LLC, 
   a Florida limited liability company 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:   
    	
/s/   Joseph Biscardi 
    
	
 
    	
Name:   
    	
Joseph   Biscardi 
    
	
 
    	
Its:   
    	
Authorized   Signatory
    
	
 
    	
 
    
	
 
    	
TERM   B LOAN BORROWER:
    
	
 
    	
 
    
	
 
    	
21C   EAST FLORIDA, LLC, 
   a Delaware limited liability company 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:   
    	
/s/   Joseph Biscardi 
    
	
 
    	
Name:   
    	
Joseph   Biscardi 
    
	
 
    	
Its:   
    	
Assistant   Treasurer
    
	
 
    	
 
    
	
 
    	
LENDERS:
    
	
 
    	
 
    
	
 
    	
Pursuant   to, and as set forth in, the Lender Agent Agreement: 
    
	
 
    	
 
    	
 
    
	
 
    	
By:   
    	
CORTLAND   CAPITAL MARKET SERVICES LLC, a Delaware limited liability company, executing   this Amendment on behalf of each Lender 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
By:   
    	
/s/s   Jessica J. Mead 
    
	
 
    	
 
    	
Name:   
    	
Jessica   J. Mead 
    
	
 
    	
 
    	
Its:   
    	
General   Counsel
    
	
 
    	
 
    
	
 
    	
ADMINISTRATIVE   AGENT 
    
	
 
    	
AND   COLLATERAL AGENT:
    
	
 
    	
 
    
	
 
    	
CORTLAND   CAPITAL MARKET SERVICES LLC,
    
	
 
    	
a   Delaware limited liability company
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:   
    	
/s/s   Jessica J. Mead
    
	
 
    	
Name:   
    	
Jessica   J. Mead
    
	
 
    	
Its:   
    	
General   Counsel
    

 

31

 

LIST OF ANNEXES, EXHIBITS AND SCHEDULES

 

ANNEXES

 

Annex A — List of First Amendment Specified Defaults

 

SCHEDULES

 

Schedule 1.1A (Amended) — Term A Loan Commitments

Schedule 1.1C — Target Seller Participation Interests

Schedule 1.1E — Existing Investments

Schedule 4.2 — No Change

Schedule 4.4 — Consents, Authorizations, Filings and Notices

Schedule 4.6 — Litigation

Schedule 4.8(a) — Liens

Schedule 4.8(b) — Real Property

Schedule 4.9(a) — Licenses

Schedule 4.9(b) — Intellectual Property

Schedule 4.14 — ERISA

Schedule 4.16 — Organizational Structure

Schedule 4.20 — Filing Offices

Schedule 4.22(b) —Leased Properties

Schedule 4.24 — Related Party Transactions

Schedule 4.25 — Insurance

Schedule 4.26 — Brokers

Schedule 5.1(i) — Special Counsel Jurisdictions

Schedule 6.6(c) — Existing Indebtedness

Schedule 6.18 — Post-Closing Requirements

Schedule 9.2 — 21C Website

 

EXHIBITS

 

Exhibit A — Form of Term A-1 Note

Exhibit B — Form of Term A-2 Note

Exhibit C — Form of Incremental Term A Loan Borrowing Notice

Exhibit D — Form of Acknowledgment and Consent of Term A Loan Guarantors

Exhibit E — Form of Acknowledgment and Consent of Term B Loan Guarantors

Exhibit F — Form of Acknowledgment and Reaffirmation of Subordination 
                                                                          (Borrower Group)

Exhibit G — Form of Acknowledgment and Reaffirmation of Subordination 
                                                                          (21C Group/Borrower Group)

Exhibit H — Form of Target Seller Participation Agreement

 

 

ANNEX A

 

List of First Amendment Specified Defaults

 

1.                                      An Event of Default occurred under Section 7(c) of the Existing Credit Agreement by virtue of the fact that the Borrowers breached, and had knowledge of the breach of, Section 6.18 of the Existing Credit Agreement by failing to perform their obligations under each of clause (f) (Escrow Agreement Arrangements) and clause (g) (Consents to the Transactions) of Schedule 6.18 to the Existing Credit Agreement.

 

2.                                      An Event of Default occurred under Section 7(l) of the Existing Credit Agreement by virtue of the fact that the representations and warranties of the Borrowers in Section 4.5 of the Existing Credit Agreement were materially false or misleading when made on the Closing Date.

 

3.                                      An Event of Default occurred under Section 7(c) of the Existing Credit Agreement by virtue of the fact that as of March 31, 2014, the Term B Loan Borrower entered into Capitalized Lease Obligations in favor of General Electric Capital Corporation or its Affiliates and incurred related Liens in violation of Sections 6.6, 6.8 and 6.15 of the Existing Credit Agreement.

 

4.                                      An Event of Default occurred under Section 7(d) of the Existing Credit Agreement by virtue of the fact that defaults with respect to Closing Date Consent Indebtedness occurred as a result of the consummation of the Transactions and continued to exist on and after the 91st day after the Closing Date.

 

5.                                      An Event of Default occurred under Section 7(c) of the Existing Credit Agreement by virtue of the fact that as of April 30, 2014, Boynton Beach Real Estate, LLC granted Liens in favor of Seacoast National Bank under the Seacoast Security Agreement in violation of Section 6.8 of the Existing Loan Agreement.

 

6.                                      An Event of Default occurred under Section 7(d) of the Existing Credit Agreement by virtue of the fact that the Seacoast Loan Agreement, entered into as of April 30, 2014, prohibited Boynton Beach Real Estate, LLC from being a Term A Loan Guarantor.

 

 

SCHEDULE 1.1A
 (Amended)

 

TERM A LOAN COMMITMENTS

 

Term A Loans (Made on Closing Date)

 

	
 
    	
 
    	
Term A Loans
    	
 
    	
 
    	
 
    
	
Lender
    	
 
    	
Gross
   Amount
    	
 
    	
Net of FUNDING
   DISCOUNT
    	
 
    	
Percentage
   of Total
    	
 
    
	
LENDER AGENT, on behalf   of the various Persons identified in the Lender Agent Agreement as “Lenders”,   and in accordance with their respective interests set forth in Schedule   1.1A to the Lender Agent Agreement
    	
 
    	
$
    	
7,900,000.00
    	
 
    	
$
    	
7,663,000.00
    	
 
    	
100
    	
%
    
										

 

Term A-1 Loan Commitments

 

	
 
    	
 
    	
Term A-1 Loans
    	
 
    	
 
    	
 
    
	
Lender
    	
 
    	
Aggregate
   Principal Amount
    	
 
    	
Percentage
   of Total
    	
 
    
	
LENDER AGENT, on behalf   of the various Persons identified in the Lender Agent Agreement as “Term A-1   Lenders”, and in accordance with their respective interests set forth in Schedule   1.1A to the Lender Agent Agreement
    	
 
    	
$
    	
10,350,000.00
    	
 
    	
100
    	
%
    
							

 

Term A-2 Loan Commitments

 

	
 
    	
 
    	
Term A-2 Loans
   (if made)
    	
 
    	
 
    	
 
    
	
Lender
    	
 
    	
Aggregate
   Principal Amount
    	
 
    	
Percentage
   of Total
    	
 
    
	
LENDER AGENT, on behalf   of the various Persons identified in the Lender Agent Agreement as “Term A-2   Lenders”, and in accordance with their respective interests set forth in Schedule   1.1A to the Lender Agent Agreement
    	
 
    	
(See the definition of Term A-2 Loan Commitments)
    	
 
    	
100
    	
%
    

 

 

SCHEDULE 1.1C

 

Target Seller’s Participation Interests

 

 

EXHIBIT A

 

Form of
  Term A-1 Note

 

 

EXHIBIT B

 

Form of
  Term A-2 Note

 

 

EXHIBIT C

 

Form of
  Incremental Term A Loan Borrowing Notice

 

 

EXHIBIT D

 

Form of
 Acknowledgment and Consent of
  Term A Loan Guarantors

 

 

EXHIBIT E

 

Form of
 Acknowledgment and Consent of
  Term B Loan Guarantors

 

 

EXHIBIT F

 

Form of
 Acknowledgment and Consent of
 Subordinated Borrowers
  (Borrower Group)

 

 

EXHIBIT G

 

Form of
 Acknowledgment and Consent of
 Subordinated Borrowers
  (21C Group / Borrower Group)

 

 

EXHIBIT H

 

Form of
  Target Seller Participation AgreementExhibit 10.2

 

CREDIT AND GUARANTY AGREEMENT

 

dated as of July 28, 2014

 

among

 

MEDICAL DEVELOPERS LLC
 as Borrower,

 

CERTAIN SUBSIDIARIES AND AFFILIATES OF MEDICAL DEVELOPERS LLC,
 as Guarantors,

 

VARIOUS LENDERS,

 

and

 

Cortland Capital Market Services LLC,
 as Administrative Agent and Collateral Agent

 

 

$17,500,000 Senior Secured Credit Facilities

 

 

 

TABLE OF CONTENTS

 

	
SECTION 1.
    	
DEFINITIONS AND   INTERPRETATION
    	
1
    
	
 
    	
 
    	
 
    
	
1.1
    	
Definitions
    	
1
    
	
1.2
    	
Accounting   Terms
    	
12
    
	
1.3
    	
Interpretation,   etc.
    	
12
    
	
 
    	
 
    	
 
    
	
SECTION 2.
    	
 
    	
TERM LOANS
    	
13
    
	
 
    	
 
    	
 
    	
 
    
	
2.1
    	
Term   Loans
    	
13
    
	
2.2
    	
Pro   Rata Shares
    	
13
    
	
2.3
    	
Use of   Proceeds
    	
14
    
	
2.4
    	
Evidence   of Debt; Register; Lenders’ Books and Records; Term Loan Notes
    	
14
    
	
2.5
    	
Interest   on Term Loans
    	
14
    
	
2.6
    	
Default   Interest
    	
15
    
	
2.7
    	
Fees
    	
15
    
	
2.8
    	
Voluntary   Prepayments
    	
15
    
	
2.9
    	
Application   of Prepayments
    	
15
    
	
2.10
    	
General   Provisions Regarding Payments
    	
16
    
	
2.11
    	
Ratable   Sharing
    	
17
    
	
2.12
    	
Increased   Costs; Capital Adequacy
    	
17
    
	
2.13
    	
Taxes;   Withholding, etc.
    	
18
    
	
 
    	
 
    	
 
    
	
SECTION 3.
    	
 
    	
CONDITIONS PRECEDENT
    	
20
    
	
 
    	
 
    	
 
    	
 
    
	
3.1
    	
Closing   Date
    	
20
    
	
3.2
    	
Additional   Conditions to Credit Extension
    	
22
    
	
 
    	
 
    	
 
    
	
SECTION 4.
    	
 
    	
REPRESENTATIONS AND   WARRANTIES
    	
23
    
	
 
    	
 
    	
 
    	
 
    
	
4.1
    	
Organization;   Requisite Power and Authority; Qualification
    	
23
    
	
4.2
    	
Due   Authorization
    	
23
    
	
4.3
    	
No   Conflict
    	
23
    
	
4.4
    	
Governmental   Consents
    	
24
    
	
4.5
    	
Binding   Obligation
    	
24
    
	
4.6
    	
Governmental   Regulation
    	
24
    
	
4.7
    	
Margin   Stock
    	
24
    
	
4.8
    	
Solvency
    	
24
    
	
4.9
    	
Terrorism   Laws and FCPA
    	
24
    
	
4.10
    	
Security   Interest in Collateral
    	
25
    
	
4.11
    	
Other   Representations and Warranties
    	
25
    
	
4.12
    	
Senior   Debt
    	
25
    
	
4.13
    	
Historical   Financial Statements
    	
25
    
	
4.14
    	
No   Material Adverse Change
    	
25
    
	
4.15
    	
Common   Enterprise
    	
26
    
	
 
    	
 
    	
 
    
	
SECTION 5.
    	
 
    	
AFFIRMATIVE COVENANTS
    	
26
    
	
 
    	
 
    	
 
    	
 
    
	
5.1
    	
Budget   and Other Reports
    	
26
    
	
5.2
    	
Existence
    	
26
    
	
5.3
    	
Subsidiaries
    	
27
    

 

i

 

	
5.4
    	
Use of   Proceeds
    	
27
    
	
5.5
    	
Post Closing Matters
    	
27
    
	
 
    	
 
    	
 
    
	
SECTION 6.
    	
 
    	
NEGATIVE COVENANTS
    	
27
    
	
 
    	
 
    	
 
    	
 
    
	
6.1
    	
Non-Ordinary   Course Transactions
    	
27
    
	
6.2
    	
Amendments   to Certain Agreements
    	
27
    
	
6.3
    	
Permitted   Activities of Borrower
    	
27
    
	
 
    	
 
    	
 
    
	
SECTION 7.
    	
 
    	
GUARANTY
    	
28
    
	
 
    	
 
    	
 
    	
 
    
	
7.1
    	
Guaranty   of the Obligations
    	
28
    
	
7.2
    	
Contribution   by Guarantors
    	
28
    
	
7.3
    	
Payment   by Guarantors
    	
28
    
	
7.4
    	
Liability   of Guarantors Absolute
    	
29
    
	
7.5
    	
Waivers   by Guarantors
    	
30
    
	
7.6
    	
Guarantors’   Rights of Subrogation, Contribution, etc.
    	
31
    
	
7.7
    	
Subordination   of Other Obligations
    	
31
    
	
7.8
    	
Continuing   Guaranty
    	
32
    
	
7.9
    	
Authority   of Guarantors or Borrower
    	
32
    
	
7.10
    	
Financial   Condition of Borrower
    	
32
    
	
7.11
    	
Bankruptcy, etc.
    	
32
    
	
 
    	
 
    	
 
    
	
SECTION 8.
    	
 
    	
EVENTS OF DEFAULT
    	
33
    
	
 
    	
 
    	
 
    	
 
    
	
8.1
    	
Events   of Default
    	
33
    
	
 
    	
 
    	
 
    
	
SECTION 9.
    	
 
    	
AGENTS
    	
35
    
	
 
    	
 
    	
 
    	
 
    
	
9.1
    	
Appointment
    	
35
    
	
9.2
    	
Delegation   of Duties
    	
35
    
	
9.3
    	
Exculpatory   Provisions
    	
35
    
	
9.4
    	
Reliance   by Administrative Agent and Collateral Agent
    	
36
    
	
9.5
    	
Notice   of Default
    	
36
    
	
9.6
    	
Non-Reliance   on Agents and Other Lenders
    	
36
    
	
9.7
    	
Indemnification
    	
37
    
	
9.8
    	
Agent   in Its Individual Capacity
    	
37
    
	
9.9
    	
Successor   Administrative Agent or Collateral Agent
    	
37
    
	
9.10
    	
Withholding   Tax
    	
38
    
	
 
    	
 
    	
 
    
	
SECTION 10.
    	
 
    	
MISCELLANEOUS
    	
38
    
	
 
    	
 
    	
 
    	
 
    
	
10.1
    	
Notices
    	
38
    
	
10.2
    	
Expenses
    	
38
    
	
10.3
    	
Indemnity
    	
39
    
	
10.4
    	
Set   Off
    	
40
    
	
10.5
    	
Amendments   and Waivers
    	
40
    
	
10.6
    	
Successors   and Assigns; Participations
    	
41
    
	
10.7
    	
Independence   of Covenants
    	
44
    
	
10.8
    	
Survival   of Representations, Warranties and Agreements
    	
44
    
	
10.9
    	
No   Waiver; Remedies Cumulative
    	
44
    
	
10.10
    	
Marshalling;   Payments Set Aside
    	
44
    
	
10.11
    	
Severability
    	
44
    
	
10.12
    	
Obligations   Several; Independent Nature of Lenders’ Rights
    	
45
    

 

ii

 

	
10.13
    	
Headings
    	
45
    
	
10.14
    	
APPLICABLE   LAW
    	
45
    
	
10.15
    	
CONSENT   TO JURISDICTION
    	
45
    
	
10.16
    	
WAIVER   OF JURY TRIAL
    	
46
    
	
10.17
    	
Confidentiality
    	
46
    
	
10.18
    	
Usury   Savings Clause
    	
47
    
	
10.19
    	
Counterparts
    	
47
    
	
10.20
    	
Effectiveness
    	
47
    
	
10.21
    	
Patriot   Act
    	
47
    
	
10.22
    	
Entire   Agreement
    	
47
    

 

iii

 

	
APPENDICES:
    	
A
    	
Term Loan Commitments
    
	
 
    	
B
    	
Notice Addresses
    
	
 
    	
 
    	
 
    
	
SCHEDULES:
    	
2.3
    	
Purchased   Assets
    
	
 
    	
4.1
    	
Jurisdictions   of Organization and Qualification
    
	
 
    	
4.11
    	
Senior   Credit Agreement Representations
    
	
 
    	
5.5
    	
Post   Closing Matters
    
	
 
    	
 
    	
 
    
	
EXHIBITS:
    	
A
    	
Funding   Notice
    
	
 
    	
B
    	
Term   Loan Note
    
	
 
    	
C
    	
Assignment   Agreement
    
	
 
    	
D
    	
Certificate   Regarding Non-bank Status
    
	
 
    	
E-1
    	
Closing   Date Certificate
    
	
 
    	
E-2
    	
Solvency   Certificate
    
	
 
    	
F
    	
Counterpart   Agreement
    
	
 
    	
G
    	
Pledge   Agreement
    

 

iv

 

CREDIT AND GUARANTY AGREEMENT

 

This CREDIT AND GUARANTY AGREEMENT, dated as of July 28, 2014, is entered into by and among MEDICAL DEVELOPERS LLC, a Florida limited liability company (the “Borrower”), certain subsidiaries and affiliates of the Borrower, as Guarantors, the Lenders party hereto from time to time, Cortland Capital Market Services LLC, as administrative agent for the Lenders (in such capacity and together with its successors and assigns in such capacity, the “Administrative Agent”) and collateral agent for the Administrative Agent and the Lenders (in such capacity and together with its successors and assigns in such capacity, the “Collateral Agent”).

 

RECITALS:

 

WHEREAS, capitalized terms used in these Recitals shall have the respective meanings set forth for such terms in Section 1.1 hereof;

 

WHEREAS, Lenders have agreed to extend certain credit facilities to Borrower in the form of delayed draw term loans in an aggregate principal amount of $17,500,000, the proceeds of which will be used for the purposes described in Section 2.3;

 

WHEREAS, Borrower has agreed to secure all of its Obligations by granting to Collateral Agent, for the benefit of Secured Parties, a First Priority Lien on substantially all of its assets, including a pledge of sixty five percent (65%) of all the voting Capital Stock and one hundred percent (100%) of all the non-voting Capital Stock of each of its direct Foreign Subsidiaries; and

 

WHEREAS, the Borrower and the Guarantors are engaged in related businesses, each Guarantor will derive substantial direct and indirect benefit from the making of the extensions of credit under the Credit Agreement, and the Guarantors have agreed to guarantee the obligations of Borrower hereunder.

 

NOW, THEREFORE, in consideration of the premises and the agreements, provisions and covenants herein contained, the parties hereto agree as follows:

 

SECTION 1.             DEFINITIONS AND INTERPRETATION

 

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

 

“21C” means 21st Century Oncology, Inc.

 

“21C Indentures” means, together, the Second Lien Notes Indenture and the Subordinated Notes Indenture.

 

“21C Notes” means, collectively, the Second Lien Notes and the Subordinated Notes.

 

“Administrative Agent” as defined in the preamble hereto.

 

“Administrative Agent’s Account” means an account at a bank designated by Administrative Agent from time to time as the account into which Credit Parties shall make all payments to Administrative Agent for the benefit of each Agent and the Lenders under this Agreement and the other Credit Documents.

 

 

“Affiliate” means, as applied to any Person, any other Person directly or indirectly controlling, controlled by, or under common control with, that Person.  For the purposes of this definition, “control” (including, with correlative meanings, the terms “controlling,” “controlled by” and “under common control with”), as applied to any Person, means the possession, directly or indirectly, of the power (i) to vote five percent (5%) or more of the Securities having ordinary voting power for the election of directors of such Person, or (ii) to direct or cause the direction of the management and policies of that Person, whether through the ownership of voting securities or by contract or otherwise.

 

“Agent” means each of Administrative Agent and Collateral Agent.

 

“Agent Fee Letter” means that certain fee letter dated as of the date of this Agreement, by and between Agent and Borrower, in its original form and as the same may be amended, modified, restated or replaced from time to time.

 

“Agent Indemnified Parties” as defined in Section 9.7.

 

“Aggregate Amounts Due” as defined in Section 2.11.

 

“Aggregate Payments” as defined in Section 7.2.

 

“Agreement” means this Credit and Guaranty Agreement, dated as of July 28, 2014, as it may be amended, supplemented or otherwise modified from time to time and any annexes, exhibits, schedules to any of the foregoing.

 

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

 

“Authorized Officer” means, as applied to any Person, any individual holding the position of chairman of the board (if an officer), chief executive officer, president, chief financial officer, secretary or treasurer, in each case, whose signatures and incumbency have been certified to Administrative Agent.

 

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

 

“Beneficiary” means each Agent and Lender.

 

“Blocked Person” as defined in Section 4.9(b).

 

“Borrower” as defined in the preamble hereto.

 

“Budget” means the 13-week statement of projected receipts and disbursements for the next 13 weeks of 21C and its Domestic Subsidiaries, broken down by week, including the anticipated uses of the Term Loans for such period delivered by the Borrower on the Closing Date and thereafter in accordance with Section 5.1(a).

 

“Business Day” means any day excluding Saturday, Sunday and any day which is a legal holiday under the laws of the State of New York or is a day on which banking institutions located in either such state are authorized or required by law or other Governmental Action to close.

 

2

 

“Capital Contribution” means (A) an equity contribution in Investments or Holdings or (B) debt incurred by Investments in an amount of no less than $150,000,000 on or before October 1, 2014 (or October 31, 2014 if Holdings has obtained committed funding by October 1 and such funding is subject to obtaining approval under the HSR Act) pursuant to a signed letter of intent reasonably acceptable to the Lenders dated on or before August 31, 2014; provided, however, that (x) such Capital Contribution shall not provide for any cash payments due before the maturity date of the Subordinated Notes and shall not mature before the maturity date of the Subordinated Notes and (y) any Capital Contribution comprising debt shall be unsecured, subordinated to the Subordinated Notes, and shall not be guaranteed by any of the Company or any of its Affiliates or Subsidiaries.

 

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

 

“Certificate Regarding Non-Bank Status” means a certificate substantially in the form of Exhibit D.

 

“Change in Law” means, the occurrence, after the date of this Agreement, of any of the following: (a) the adoption or taking effect of any law, rule, regulation or treaty, (b) any change in any law, rule, regulation or treaty 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 Authority; provided that notwithstanding anything herein to the contrary, (x) the Dodd-Frank Wall Street Reform and Consumer Protection Act and all requests, rules, guidelines or directives thereunder or issued in connection therewith and (y) all requests, rules, guidelines or directives promulgated by the Bank for International Settlements, the Basel Committee on Banking Supervision (or any successor or similar authority) or the United States or foreign regulatory authorities, in each case pursuant to Basel III, shall in each case be deemed to be a “Change in Law” regardless of the date enacted, adopted or issued.

 

“Closing Date” means the date on which the initial Term Loans are made.

 

“Closing Date Certificate” means a Closing Date Certificate substantially in the form of Exhibit E-1.

 

“Collateral” means, collectively, all of the real, personal and mixed property (including Capital Stock) on which a Lien is purported to be granted pursuant to the Collateral Documents as security for the Obligations.

 

“Collateral Agent” as defined in the preamble hereto.

 

“Collateral Documents” means the Pledge Agreement and all other instruments, documents and agreements delivered by Borrower or any of its Subsidiaries pursuant to this Agreement or any of the other Credit Documents in order to grant to Collateral Agent, for the benefit of Secured Parties, a Lien on any property of the Borrower or any other Credit Party as security for the Obligations.

 

“Contributing Guarantors” as defined in Section 7.2.

 

“Counterpart Agreement” means a Counterpart Agreement substantially in the form of Exhibit F delivered by a Credit Party pursuant to Section 5.3.

 

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

 

“Credit Document” means any of this Agreement, the Term Loan Notes, if any, the Collateral Documents, the Agent Fee Letter and all other certificates, documents, instruments or agreements executed and delivered by a Credit Party for the benefit of any Agent or any Lender in connection herewith.

 

“Credit Extension” means the making of a Term Loan.

 

“Credit Party” means each Person (other than any Agent or any Lender or any representative thereof) from time to time party to a Credit Document.

 

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

 

“Default Rate” means any interest payable pursuant to Section 2.6.

 

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

 

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

 

“Eligible Assignee” means (a) any Lender, any Affiliate of any Lender and any Related Fund (any two or more Related Funds being treated as a single Eligible Assignee for all purposes hereof), (b) any commercial bank, insurance company, investment or mutual fund or other entity that is an “accredited investor” (as defined in Regulation D under the Securities Act) and which extends credit or buys loans as one of its businesses, or (c) any other Person (other than a natural Person) approved by Administrative Agent; provided, neither Holdings nor any Affiliate of Holdings shall, in any event, be an Eligible Assignee.

 

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

 

“Environmental Laws” means any and all current or future foreign or domestic, federal, state or local (or any subdivision of any of them), statutes, ordinances, orders, rules, regulations, judgments, Governmental Authorizations, or any other requirements of Governmental Authorities relating to (i) public health and safety, protection of the environment or other environmental matters, including those relating to any Hazardous Materials Activity; (ii) the generation, use, storage, transportation or disposal of Hazardous Materials; or (iii) occupational safety and health, industrial hygiene, land use or the protection of human, plant or animal health or welfare.

 

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

 

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

 

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“Excluded Taxes” means, with respect to any Lender or any other recipient of any payment to be made by or on account of any obligation of Borrower hereunder (a) Taxes imposed on such Lender or other recipient’s overall net income (however denominated), franchise Taxes imposed in lieu thereof and branch profits Taxes (i) by the United States, (ii) by any other Government Authority under the laws of which such Lender or other recipient is organized or has its principal office or, in the case of any Lender, maintains its applicable lending office or (iii) by any Government Authority as a result of a present or former connection between such recipient and the jurisdiction of such Government Authority (other than any such connection arising from such recipient having executed, delivered become a party to, performed its obligations or received a payment under, received or perfected a security interest under, engaged in any other transaction pursuant to or enforced, any of the Credit Documents, or sold or assigned an interest in any Term Loan or Credit Document), (b) any withholding Tax that (i) is imposed on amounts payable to or for the account of such Lender with respect to an applicable interest in a Term Loan or Term Loan Commitment at the time it acquires such interest in the Term Loan or Term Loan Commitment (or designates a new lending office), or (ii) is attributable to such Lender’s failure or inability (other than as a result of a Change in Law) to comply with its obligations under Sections 2.13(e), (f) or (g), except to the extent that such Lender (or its assignor, if any) was entitled, at the time of designation of a new lending office (or assignment), to receive additional amounts with respect to such withholding Tax pursuant to Section 2.13(b) and (c) any U.S. withholding Tax imposed under FATCA. All references to a Lender in the preceding sentence shall include any Tax Related Person to the extent a payment to a Lender is allocable to such Tax Related Person, provided that such Tax Related Person will be deemed to satisfy the requirements of Sections 2.13(e), (f) or (g) if it provides the required documents to the Lender to which it is related.

 

“Fair Share” as defined in Section 7.2.

 

“Fair Share Contribution Amount” as defined in Section 7.2.

 

“FATCA” means Sections 1471 through 1474 of the Internal Revenue Code, as in effect as of the date hereof (or any amended or successor version thereof that is substantively comparable and not materially more onerous to comply with), any current or future regulations or official interpretations thereof, 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 entered into in connection with the implementation of such Sections of the Internal Revenue Code.

 

“FCPA” as defined in Section 4.9.

 

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

 

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

 

“Funding Guarantor” as defined in Section 7.2.

 

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

 

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

 

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

 

“Governmental Authority” means any federal, state, municipal, national or other government, governmental department, commission, board, bureau, court, agency or instrumentality or political subdivision thereof or any entity or officer exercising executive, legislative, judicial, taxing, regulatory or administrative functions of or pertaining to any government or any court, in each case whether associated with a state of the United States, the United States, or a foreign entity or government.

 

“Governmental Authorization” means any permit, license, authorization, plan, directive, consent order or consent decree of or from any Governmental Authority.

 

“Grantor” means any “Grantor” as defined in the Pledge Agreement.

 

“Guaranteed Obligations” as defined in Section 7.1.

 

“Guarantor” means each of Holdings and each Subsidiary of Holdings that is an obligor under the Senior Credit Agreement or the 21C Notes.

 

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

 

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

 

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

 

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

 

“Holdings” means 21st Century Oncology Holdings, Inc.

 

“HSR Act” means the Hart-Scott-Rodino Antitrust Improvements Act of 1976.

 

“Indemnified Liabilities” means, collectively, any and all liabilities, obligations, losses, damages (including natural resource damages), penalties, claims (including Environmental Claims), costs (including the costs of any investigation, study, sampling, testing, abatement, cleanup, removal, remediation or other response action necessary to remove, remediate, clean up or abate any Hazardous Materials Activity), expenses and disbursements of any kind or nature whatsoever (including the reasonable fees and disbursements of counsel for Indemnitees in connection with any investigative, administrative or judicial proceeding commenced or threatened by any Person, whether or not any such

 

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Indemnitee shall be designated as a party or a potential party thereto, and any fees or expenses incurred by Indemnitees in enforcing this indemnity), whether direct, indirect or consequential and whether based on any federal, state or foreign laws, statutes, rules or regulations (including securities and commercial laws, statutes, rules or regulations and Environmental Laws), on common law or equitable cause or on contract or otherwise, that may be imposed on, incurred by, or asserted against any such Indemnitee, in any manner relating to or arising out of (i) this Agreement or the other Credit Documents or the financing transactions contemplated hereby or thereby (including the Lenders’ agreement to make Credit Extensions or the use or intended use of the proceeds thereof, or any enforcement of any of the Credit Documents (including any sale of, collection from, or other realization upon any of the Collateral or the enforcement of the Guaranty)); or (ii) any Environmental Claim against or any Hazardous Materials Activity relating to or arising from, directly or indirectly, any past or present activity, operation, land ownership, or practice of Holdings or any of its Subsidiaries.

 

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

 

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

 

“Interest Payment Date” means the Term Loan Maturity Date.

 

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

 

“Investments” means 21st Century Oncology Investments, LLC.

 

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

 

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

 

“Margin Stock” as defined in Regulation U of the Board of Governors of the Federal Reserve System as in effect from time to time.

 

“Material Adverse Effect” means a material adverse effect on and/or material adverse developments with respect to (i) the business operations, properties, assets, condition (financial or otherwise) or prospects of (x) Holdings and its Subsidiaries taken as a whole or (y) the Borrower and its Subsidiaries taken as a whole; (ii) the ability of any Credit Party to fully and timely perform its Obligations; (iii) the legality, validity, binding effect, or enforceability against a Credit Party of a Credit Document to which it is a party; (iv) the Collateral or Collateral Agent’s Liens (on behalf of itself and the Secured Parties) on the Collateral or the priority of such Liens; or (v) the rights, remedies and benefits available to, or conferred upon, any Agent and any Lender or any Secured Party under any Credit Document.

 

“NAIC” means The National Association of Insurance Commissioners, and any successor thereto.

 

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“Non-U.S. Lender” as defined in Section 2.13(e).

 

“Obligations” means all liabilities and obligations of every nature of each Credit Party and its Subsidiaries from time to time owed to the Agents (including former Agents), the Lenders or any of them under any Credit Document, whether for principal, interest (including interest which, but for the filing of a petition in bankruptcy with respect to such Credit Party, would have accrued on any Obligation, whether or not a claim is allowed against such Credit Party for such interest in the related bankruptcy proceeding), fees, expenses, indemnification or otherwise and whether primary, secondary, direct, indirect, contingent, fixed or otherwise (including obligations of performance).

 

“Obligee Guarantor” as defined in Section 7.7.

 

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

 

“OFAC Sanctions Programs” means the laws, regulations and Executive Orders administered by OFAC, including but not limited to, Executive Order No. 13224 on Terrorist Financing, effective September 24, 2001, as it has been or shall thereafter be renewed, extended, amended or replaced, and the list of Specially Designated Nationals and Blocked Persons administered by OFAC, as such list may be amended from time to time.

 

“Organizational Documents” means (i) with respect to any corporation, its certificate or articles of incorporation or organization, as amended, and its bylaws, as amended, (ii) with respect to any limited partnership, its certificate of limited partnership, as amended, and its partnership agreement, as amended, (iii) with respect to any general partnership, its partnership agreement, as amended, and (iv) with respect to any limited liability company, its articles of organization, as amended, and its operating agreement, as amended.  In the event any term or condition of this Agreement or any other Credit Document requires any Organizational Document to be certified by a secretary of state or similar governmental official, the reference to any such “Organizational Document” shall only be to a document of a type customarily certified by such governmental official.

 

“Other Taxes” means any and all present or future stamp, court or documentary, registration, intangible, recording, filing, transfer, documentary, excise or property or similar Taxes arising from any payment made hereunder or from the execution, delivery, performance, enforcement or registration of, from the receipt or perfection of a security interest under, or otherwise with respect to or in connection with, any Credit Document.

 

“Participant” as defined in Section 10.6(h).

 

“Participant Register” as defined in Section 10.6(h).

 

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

 

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

 

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“Pledge Agreement” means the Pledge Agreement to be executed by Borrower and MD International Investments, LLC substantially in the form of Exhibit G, as it may be amended, supplemented or otherwise modified from time to time.

 

“Principal Office” means, for Administrative Agent, such Person’s “Principal Office” as set forth on Appendix B, or such other office as such Person may from time to time designate in writing to Borrower, Administrative Agent and each Lender.

 

“Pro Rata Share” means with respect to all payments, computations and other matters relating to the Term Loan of any Lender, the percentage obtained by dividing (a) the Term Loan Exposure of that Lender by (b) the aggregate Term Loan Exposure of all Lenders; provided that, with respect to credit extensions by and payments to (i) Lenders having Tranche A Term Loan Commitments and/or Tranche A Term Loans only, Pro Rata Share means, the percentage obtained by dividing (a) the Tranche A Term Loan Exposure of that Lender, by (b) the aggregate Tranche A Term Loan Exposure of all Lenders and (ii) Lenders having Tranche B Term Loan Commitments and/or Tranche B Term Loans only, Pro Rata Share means, the percentage obtained by dividing (a) the Tranche B Term Loan Exposure of that Lender by (b) the aggregate Tranche B Term Loan Exposure of all Lenders.

 

“Recapitalization Agreement” means the recapitalization support agreement entered into as of July 28, 2014 by and among (i) Investments, Holdings, 21C and each of their direct and indirect wholly owned subsidiaries that are obligors under the Senior Credit Agreement or the 21C Notes (collectively with Investments, Holdings and 21C, the “Company”), (ii) certain of the holders of, or the investment advisor or manager to a beneficial or legal holder or holders of certain indebtedness of the Company incurred under the Subordinated Notes Indenture and (iii) Vestar Capital Partners V, L.P., Vestar Capital Partners V-A, L.P., Vestar Executive V, L.P., Vestar Holdings V, L.P., Vestar/Radiation Therapy Investments, LLC, and any investment fund affiliated with Vestar Capital Partners V, L.P. that now owns or subsequently acquires equity interests in Investments (collectively, “Vestar”).

 

“Register” as defined in Section 2.4(b).

 

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

 

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

 

“Requisite Lenders” means one or more Lenders having or holding Term Loan Exposure and representing more than fifty percent (50%) of the aggregate Term Loan Exposure of all Lenders.

 

“Second Lien Notes” means the 8 7/8% Senior Secured Second Lien Notes due 2017 of 21C issued under the Second Lien Notes Indenture.

 

“Second Lien Notes Indenture” means that certain Indenture (as amended to date, and as it may hereafter be amended, supplemented or modified from time to time), for the Second Lien Notes, dated as of May 10, 2012, among 21C, the guarantors party thereto and Wilmington Trust, National Association.

 

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“Secured Parties” means, collectively, the Administrative Agent, the Collateral Agent and the Lenders.

 

“Senior Credit Agreement” means that certain credit agreement, dated as of May 10, 2012 (as amended to date, and as it may hereafter be amended, supplemented or modified from time to time), by and among 21C, as borrower, Holdings, Wells Fargo Bank National Association, as administrative agent, collateral agent, issuing bank and as swingline lender, the other agents party thereto and the lenders party thereto.

 

“Solvency Certificate” means a Solvency Certificate of the chief executive officer of the Borrower substantially in the form of Exhibit E-2.

 

“Solvent” means, with respect to any Person, that as of the date of determination, both (i) (a) the sum of such Person’s debt and liabilities (including contingent liabilities) does not exceed the present fair saleable value of such Person’s present assets; (b) such Person’s capital is not unreasonably small in relation to its business as contemplated on the Closing Date; and (c) such Person has not incurred and does not intend to incur, or believe (nor should it reasonably believe) that it will incur, debts beyond its ability to pay such debts as they become due (whether at maturity or otherwise) (assuming for purposes of this clause (c) that the transactions contemplated by the Recapitalization Agreement shall be consummated or that the Term Loans are extended or otherwise refinanced); and (ii) such Person is “solvent” within the meaning given that term and similar terms under applicable laws relating to fraudulent transfers and conveyances.  For purposes of this definition, (i) the amount of any contingent liability at any time shall be computed as the amount that, in light of all of the facts and circumstances existing at such time, represents the amount that can reasonably be expected to become an actual or matured liability (irrespective of whether such contingent liabilities meet the criteria for accrual under Statement of Financial Accounting Standard No. 5) and (ii) “present fair salable value” shall mean, with respect to a Person, the amount that could be obtained by an independent willing seller from an independent willing buyer if the assets of such Person and its Subsidiaries taken as a whole are sold with reasonable promptness in an arm’s length transaction under present conditions for the sale of comparable business enterprises insofar as such conditions can be reasonably evaluated.

 

“Subordinated Notes” means the 9 7/8% Senior Subordinated Notes due 2017 of 21C issued under the Subordinated Notes Indenture.

 

“Subordinated Notes Indenture” means that certain Indenture (as amended to date, and as it may hereafter be amended, supplemented or modified from time to time), for the Subordinated Notes, dated as of April 20, 2010, among 21C, the guarantors party thereto and Wilmington Trust, National Association.

 

“Subsidiary” means, with respect to any Person, any corporation, partnership, limited liability company, association, joint venture or other business entity the accounts of which would be consolidated with those of such Person in such Person’s consolidated financial statements if such financial statements were prepared in accordance with GAAP as of such date, as well as any other corporation, partnership, limited liability company, association, joint venture or other business entity of which more than fifty percent (50%) of the total voting power of shares of stock or other ownership interests entitled (without regard to the occurrence of any contingency) to vote in the election of the Person or Persons (whether directors, managers, trustees or other Persons performing similar functions) having the power to direct or cause the direction of the management and policies thereof is at the time owned or controlled, directly or indirectly, by that Person or one or more of the other Subsidiaries of that Person or a combination thereof.  Unless the context otherwise requires, when used in this Agreement, the term “Subsidiary” shall refer to a Subsidiary of Borrower.

 

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“Tax” means any present or future tax, levy, impost, duty, assessment, charge, fee, deduction or withholding of any nature and whatever called, by any Governmental Authority, on whomsoever and wherever imposed, levied, collected, withheld or assessed, and any interest, penalties or additional amounts thereon.

 

“Tax Related Person” means, in the case of a Lender that is treated as fiscally transparent for income tax purposes (including, without limitation, partnership, simple or complex trust, grantor trust, or S corporation), a direct or indirect beneficial owner in such Lender who is taxable on an allocable share of income of the Lender.

 

“Term Loan” means a Tranche A Term Loan and/or a Tranche B Term Loan.

 

“Term Loan Commitment” means the commitment of a Lender to make or otherwise fund a Term Loan and “Term Loan Commitments” means such commitments of all Lenders in the aggregate.

 

“Term Loan Commitment Period” means the period from the Closing Date to the Term Loan Commitment Termination Date.

 

“Term Loan Commitment Termination Date” means the earliest to occur of (i) October 31, 2014 and (ii) the date of the termination of the Term Loan Commitments pursuant to Section 8.1.

 

“Term Loan Exposure” means, with respect to any Lender, as of any date of determination, the sum of (i) outstanding principal amount of the Term Loans of such Lender and (ii) the Term Loan Commitments of such Lender.

 

“Term Loan Maturity Date” means the earlier of (i) November 15, 2014 and (ii) the date that all Term Loans shall become due and payable in full hereunder, whether by acceleration or otherwise.

 

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

 

“Terrorism Laws”  means any laws relating to terrorism or money laundering, including, without limitation, (i) the Money Laundering Control Act of 1986 (i.e., 18 U.S.C. §§ 1956 and 1957), (ii) the Bank Secrecy Act, as amended by the Patriot Act, (iii) the laws, regulations and Executive Orders administered by OFAC, (iv) the Comprehensive Iran Sanctions, Accountability, and Divestment Act, as amended, and any related executive orders and regulations, (v) any law prohibiting or directed against terrorist activities or the financing of terrorist activities (e.g., 18 U.S.C. §§ 2339A and 2339B) or (vi) any similar laws enacted in the United States or any other jurisdictions in which the parties to this agreement operate, as any of the foregoing laws may from time to time be amended, renewed, extended or replaced and all other present and future legal requirements of any Governmental Authority governing, addressing, relating to, or attempting to eliminate, terrorist acts and acts of war and any regulations promulgated pursuant thereto.

 

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

 

“Tranche A Term Loan Commitment” means the commitment of a Lender to make or otherwise fund any Tranche A Term Loan and “Tranche A Term Loan Commitments” means such

 

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commitments of all Lenders in the aggregate.  The amount of each Lender’s Tranche A Term Loan Commitment, if any, is set forth on Appendix A or in the applicable Assignment Agreement, subject to any adjustment or reduction pursuant to the terms and conditions hereof.  The aggregate amount of the Tranche A Term Loan Commitments as of the Closing Date is $8,500,000.

 

“Tranche A Term Loan Exposure” means, with respect to any Lender, as of any date of determination, the sum of (i) outstanding principal amount of the Tranche A Term Loans of such Lender and (ii) the Tranche A Term Loan Commitments of such Lender.

 

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

 

“Tranche B Term Loan Commitment” means the commitment of a Lender to make or otherwise fund any Tranche B Term Loan and “Tranche B Term Loan Commitments” means such commitments of all Lenders in the aggregate.  The amount of each Lender’s Tranche B Term Loan Commitment, if any, is set forth on Appendix A or in the applicable Assignment Agreement, subject to any adjustment or reduction pursuant to the terms and conditions hereof.  The aggregate amount of the Tranche B Term Loan Commitments as of the Closing Date is $9,000,000.

 

“Tranche B Term Loan Exposure” means, with respect to any Lender, as of any date of determination, the sum of (i) outstanding principal amount of the Tranche B Term Loans of such Lender and (ii) the Tranche B Term Loan Commitments of such Lender.

 

“Transactions” means the Equity Contribution, the borrowing of the initial Term Loans on the Closing Date and the payment of fees and expenses in connection therewith.

 

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

 

“Withholding Agent” means any Credit Party and the Administrative Agent.

 

1.2                               Accounting Terms.  Except as otherwise expressly provided herein, all accounting terms not otherwise defined herein shall have the meanings assigned to them in conformity with GAAP.

 

1.3                               Interpretation, etc.  Any of the terms defined herein may, unless the context otherwise requires, be used in the singular or the plural, depending on the reference.  References herein to any Section, Appendix, Schedule or Exhibit shall be to a Section, an Appendix, a Schedule or an Exhibit, as the case may be, hereof unless otherwise specifically provided.  The use herein of the word “include” or “including,” when following any general statement, term or matter, shall not be construed to limit such statement, term or matter to the specific items or matters set forth immediately following such word or to similar items or matters, whether or not no limiting language (such as “without limitation” or “but not limited to” or words of similar import) is used with reference thereto, but rather shall be deemed to refer to all other items or matters that fall within the broadest possible scope of such general statement, term or matter.  Unless otherwise indicated, 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, supplemented or otherwise modified (subject to any restrictions on such amendments, supplements or modifications set forth herein).  Reference to a Credit Party’s “knowledge” or similar concept means actual knowledge of an Authorized Officer, or knowledge that an Authorized Officer would have obtained if he or she had engaged in good faith and diligent performance of his or her duties, including reasonably specific inquiries of employees or agents and a good faith attempt to ascertain the matter.

 

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SECTION 2.                        TERM LOANS

 

2.1                               Term Loans.

 

(a)                           Tranche A Term Loan Commitments.  During the Term Loan Commitment Period, subject to the terms and conditions hereof, each Lender severally agrees to make Tranche A Term Loans to Borrower in an aggregate amount up to but not exceeding such Lender’s Tranche A Term Loan Commitment.  Any amount borrowed under this Section 2.1(a) and subsequently repaid or prepaid may not be reborrowed.  All amounts owed hereunder with respect to the Tranche A Term Loans shall be paid in full no later than the Term Loan Maturity Date.  Each Lender’s Tranche A Term Loan Commitment shall expire on the Term Loan Commitment Termination Date and shall be reduced by the amount of Tranche A Term Loans made by such Lender on each Credit Date.

 

(b)                           Tranche B Term Loan Commitments.  During the Term Loan Commitment Period, subject to the terms and conditions hereof, each Lender severally agrees to make Tranche B Term Loans to Borrower in an aggregate amount up to but not exceeding such Lender’s Tranche B Term Loan Commitment.  Any amount borrowed under this Section 2.1(b) and subsequently repaid or prepaid may not be reborrowed.  All amounts owed hereunder with respect to the Tranche B Term Loans shall be paid in full no later than the Term Loan Maturity Date.  Each Lender’s Tranche B Term Loan Commitment shall expire on the Term Loan Commitment Termination Date and shall be reduced by the amount of Tranche B Term Loans made by such Lender on each Credit Date.

 

(c)                            Term Loan Mechanics

 

(i)                                           Term Loans shall be made in an aggregate minimum amount of $2,000,000 and integral multiples of $500,000 in excess of that amount.

 

(ii)                                        Whenever Borrower desires that Lenders make Term Loans, Borrower shall deliver to Administrative Agent a fully executed and delivered Funding Notice no later than 2:00 p.m. (New York City time) at least one Business Day in advance of the proposed Credit Date (or such shorter time as is agreed to by the Administrative Agent). Each Funding Notice shall be made in writing and shall be irrevocable and Borrower shall be bound to make a borrowing in accordance therewith.

 

(iii)                                     Notice of receipt of each Funding Notice together with the amount of each Lender’s Pro Rata Share thereof, if any, shall be provided by Administrative Agent to each applicable Lender by email with reasonable promptness.

 

(iv)                                    Subject to the terms and conditions of this Agreement and the other Credit Documents, each Lender shall make the amount of its Term Loan available to Administrative Agent not later than 12:00 p.m. (New York City time) on the applicable Credit Date by wire transfer of same day funds in Dollars, at the Principal Office designated by Administrative Agent.  To the extent received by Administrative Agent, Administrative Agent shall make the proceeds of such Term Loans available to Borrower on the applicable Credit Date by causing an amount of same day funds in Dollars equal to the proceeds of all such Term Loans received by Administrative Agent from Lenders to be credited to or for the account of Borrower as specified in the applicable Funding Notice.

 

2.2                               Pro Rata Shares.  All Tranche A Term Loans and Tranche B Term Loans shall be made by the applicable Lenders simultaneously and proportionately to their respective Pro Rata Shares, it being 

 

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understood that no Lender shall be responsible for any default by any other Lender in such other Lender’s obligation to make a Term Loan requested hereunder nor shall any Term Loan Commitment of any Lender be increased or decreased as a result of a default by any other Lender in such other Lender’s obligation to make a Term Loan requested hereunder.

 

2.3                               Use of Proceeds.  The proceeds of the Tranche A Loans shall be applied by Borrower for working capital and general corporate purposes of the Credit Parties in accordance with the Budget.  The proceeds of the Tranche B Loans shall be applied by Borrower to fund the purchase of assets used or useful in the business of Holdings and its Subsidiaries as set forth on Schedule 2.3.

 

2.4                               Evidence of Debt; Register; Lenders’ Books and Records; Term Loan Notes.

 

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

 

(b)                          Register.  Administrative Agent shall maintain at its Principal Office a register for the recordation of the names and addresses of Lenders and the Term Loan Commitments and Term Loans of each Lender from time to time (the “Register”).  The Register shall be available for inspection by Borrower, and a redacted version of the Register showing the entries with respect to any Lender shall be available for inspection by such Lender, at any reasonable time and from time to time upon reasonable prior notice.  Administrative Agent shall record in the Register the Term Loan Commitments and the Term Loans (including stated interest), and each repayment or prepayment in respect of the principal amount of the Term Loans, and any such recordation shall be conclusive and binding on the Borrower and each Lender, absent manifest error.

 

(c)                           Term Loan Notes.  If so requested by any Lender by written notice to Borrower (with a copy to Administrative Agent) at least two (2) Business Days prior to the Closing Date, or at any time thereafter, Borrower shall execute and deliver to such Lender (and/or, if applicable and if so specified in such notice, to any Person who is an assignee of such Lender pursuant to Section 10.6) on the Closing Date (or, if such notice is delivered after the Closing Date, promptly after Borrower’s receipt of such notice) a Term Loan Note or Term Loan Notes to evidence such Lender’s Term Loans to such Borrower.

 

2.5                               Interest on Term Loans.

 

(a)                          Except as otherwise set forth herein, Term Loans shall bear interest on the unpaid principal amount thereof from the date made through repayment (whether by acceleration or otherwise) at a rate per annum equal to fourteen percent (14.0%).

 

(b)                          Interest payable pursuant to Section 2.5(a) shall be computed on the basis of a 360 day year for the actual number of days elapsed in the period during which it accrues.  In computing interest on any Term Loan, the date of the making of such Term Loan shall be included, and the date of payment of such Term Loan shall be excluded.

 

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(c)                           Except as otherwise set forth herein, interest on each Term Loan shall be payable in arrears (i) upon any prepayment of that Term Loan, whether voluntary or otherwise, to the extent accrued on the amount being prepaid and (ii) on the Interest Payment Date.

 

2.6                               Default Interest.  Upon the occurrence and during the continuance of an Event of Default, the principal amount of all Term Loans outstanding and, to the extent permitted by applicable law, any interest payments on the Term Loans or any fees or other amounts owed hereunder, shall thereafter bear interest (including post-petition interest in any proceeding under the Bankruptcy Code or other applicable bankruptcy laws, whether or not allowed in such a proceeding) payable on demand (or, in the absence of demand, on the last Business Day of each calendar month) at a rate that is four percent (4.0%) per annum in excess of the interest rate otherwise payable hereunder with respect to the Term Loans.  Payment or acceptance of the increased rates of interest provided for in this Section 2.6 is not a permitted alternative to timely payment and shall not constitute a waiver of any Event of Default or otherwise prejudice or limit any rights or remedies of Administrative Agent or any Lender.

 

2.7                               Fees.

 

(a)                          On the Term Loan Maturity Date (including as a result of acceleration (including upon the occurrence of any Event of Default described in Section 8.1(f) or 8.1(g))), the Borrower will pay the Administrative Agent, for the ratable benefit of the Lenders, a fee equal to $1,750,000 (or $875,000 if Holdings obtains the Capital Contribution).

 

(b)                          In addition to the foregoing fee, the Borrower agrees to pay to Agents such other fees in the amounts and at the times set forth in the Agent Fee Letter.

 

2.8                               Voluntary Prepayments.  Any time and from time to time the Borrower may prepay any Term Loans on any Business Day in whole or in part, in an aggregate minimum amount of $500,000 and integral multiples of $100,000 in excess of that amount.  All such prepayments shall be made upon not less than one Business Day’s prior written notice in form acceptable to the Administrative Agent (each, a “Prepayment Notice”), in each case given by Borrower to Administrative Agent by 12:00 p.m. (New York City time) on the date required (and Administrative Agent will promptly transmit a copy of such Prepayment Notice by telefacsimile or email to each Lender).  Upon the giving of any such notice, the principal amount of the Term Loans specified in such notice shall become due and payable on the prepayment date specified therein.  Any such voluntary prepayment shall be applied as specified in Section 2.9 and shall be made together with all amounts owing in accordance with Section 2.2.

 

2.9                               Application of Prepayments.

 

(a)                          Application of All Prepayments.  Any prepayment of any Term Loan pursuant to Section 2.8 shall be applied as follows:

 

first, to the payment of all expenses and fees of the Agents and the Lenders hereunder to the full extent thereof;

 

second, to the payment of any accrued interest thereon at the Default Rate, if any;

 

third, to the payment of any accrued interest thereon (other than that calculated at the Default Rate and paid in clause “second” above); and

 

fourth, to prepay Term Loans on a pro rata basis (in accordance with the respective outstanding principal amounts thereof).

 

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With respect to any prepayment, the Administrative Agent shall determine the amounts to be allocated hereunder.  Determinations by the Administrative Agent hereunder shall be deemed conclusive and binding on the Borrower and Lenders absent manifest error.

 

2.10                        General Provisions Regarding Payments.

 

(a)                     All payments by the Borrower of principal, interest, fees and other Obligations shall be made in Dollars in same day funds, without, recoupment, setoff, counterclaim or other defense free of any restriction or condition, and delivered to Administrative Agent not later than 12:00 p.m. (New York City time) on the date due, to Administrative Agent’s Account for the account of the Agents and the ratable account of the Lenders, as applicable; funds received by Administrative Agent after 12:00 p.m. (New York City time) on such due date may be deemed to have been paid by the Borrower on the next Business Day.

 

(b)                     All payments in respect of the principal amount of any Term Loan shall be accompanied by payment of accrued interest on the principal amount being repaid or prepaid.

 

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

 

(d)                     Whenever any payment to be made hereunder shall be stated to be due on a day that is not a Business Day, such payment shall be made on the next succeeding Business Day and such extension of time shall be included in the computation of the payment of interest hereunder or of the commitment fees hereunder.

 

(e)                      Administrative Agent may deem any payment by or on behalf of the Borrower hereunder that is not made in same day funds prior to 12:00 p.m.  (New York City time) to be a non-conforming payment.  Any such payment may, at the election of the Administrative Agent, be deemed to have not been received by Administrative Agent until the later of (i) the time such funds become available funds, and (ii) the applicable next Business Day.  Interest fees shall continue to accrue on any principal as to which a non-conforming payment is made until such funds become available funds (but in no event less than the period from the date of such payment to the next succeeding applicable Business Day) at the Default Rate determined pursuant to Section 2.6 from the date such amount was due and payable until the date such amount is paid in full.

 

(f)                       If an Event of Default shall have occurred and not otherwise been waived and the maturity of the Obligations shall have been accelerated pursuant to Section 8.1 all payments or proceeds received by Agents hereunder in respect of any of the Obligations shall be applied first, to pay any costs and expenses then due to any Agent in connection with the foreclosure or realization upon, the disposal, storage, maintenance or otherwise dealing with any of, the Collateral or otherwise, and indemnities and other amounts then due to any Agent under the Credit Documents until paid in full, second, to pay any costs, expenses, indemnities, fees or premiums then due to Administrative Agent under the Credit Documents until paid in full, third, ratably to pay any expenses or indemnities then due to any of the Lenders under the Credit Documents, until paid in full, fourth, ratably to pay interest due in respect of the Term Loan until paid in full, fifth, ratably to pay the principal amount of all Term Loans then outstanding until paid in full, and sixth, to pay ratably any other Obligations then due and payable.

 

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2.11                        Ratable Sharing.  Lenders hereby agree among themselves that, except as otherwise provided in the Collateral Documents with respect to amounts realized from the exercise of rights with respect to Liens on the Collateral, if any of them shall, whether by voluntary payment (other than a voluntary prepayment of Term Loans made and applied in accordance with the terms hereof), through the exercise of any right of set off or banker’s lien, by counterclaim or cross action or by the enforcement of any right under the Credit Documents or otherwise, or as adequate protection of a deposit treated as cash collateral under the Bankruptcy Code, receive payment or reduction of a proportion of the aggregate amount of principal, interest, fees and other amounts then due and owing to such Lender hereunder or under the other Credit Documents (collectively, the “Aggregate Amounts Due” to such Lender) which is greater than the proportion received by any other Lender in respect of the Aggregate Amounts Due to such other Lender, then the Lender receiving such proportionately greater payment shall (a) notify Administrative Agent and each other Lender of the receipt of such payment and (b) apply a portion of such payment to purchase participations (which it shall be deemed to have purchased from each seller of a participation simultaneously upon the receipt by such seller of its portion of such payment) in the Aggregate Amounts Due to the other Lenders so that all such recoveries of Aggregate Amounts Due shall be shared by all Lenders in proportion to the Aggregate Amounts Due to them; provided, that if all or part of such proportionately greater payment received by such purchasing Lender is thereafter recovered from such Lender upon the bankruptcy or reorganization of Borrower or otherwise, those purchases to that extent shall be rescinded and the purchase prices paid for such participations shall be returned to such purchasing Lender ratably to the extent of such recovery, but without interest.  The Borrower expressly consent to the foregoing arrangement and agrees that any holder of a participation so purchased may exercise any and all rights of banker’s lien, set off or counterclaim with respect to any and all monies owing by the Borrower to that holder with respect thereto as fully as if that holder were owed the amount of the participation held by that holder.

 

2.12                        Increased Costs; Capital Adequacy.

 

(a)                     Compensation For Increased Costs and Taxes.  Subject to the provisions of Section 2.13 (which shall be controlling with respect to the matters covered thereby), in the event that any Lender shall determine (which determination shall, absent manifest error, be final and conclusive and binding upon all parties hereto) that any Change in Law, or any determination of a court or Governmental Authority that becomes effective after the date hereof, or compliance by such Lender with any guideline, request or directive issued or made after the date hereof by any central bank or other governmental or quasi-Governmental Authority (whether or not having the force of law): (i) subjects such Lender (or its applicable lending office) to any additional Tax (other than any Indemnified Taxes or Taxes described in clauses (a)(iii), (b) and (c) of the definition of Excluded Taxes) with respect to this Agreement or any of the other Credit Documents or any of its obligations hereunder or thereunder or any payments to such Lender (or its applicable lending office) of principal, interest, fees or any other amount payable hereunder; (ii) imposes, modifies or holds applicable any reserve (including any marginal, emergency, supplemental, special or other reserve), special deposit, compulsory loan, FDIC insurance or similar requirement against assets held by, or deposits or other liabilities in or for the account of, or advances or loans by, or other credit extended by, or any other acquisition of funds by, any office of such Lender or (iii) imposes any other condition (other than with respect to a Tax matter) on or affecting such Lender (or its applicable lending office) or its obligations hereunder; and the result of any of the foregoing is to increase the cost to such Lender of agreeing to make, making or maintaining Term Loans hereunder or to reduce any amount received or receivable by such Lender (or its applicable lending office) with respect thereto; then, in any such case, the Borrower shall promptly pay to such Lender, upon receipt of the statement referred to in the next sentence, such additional amount or amounts (in the form of an increased rate of, or a different method of calculating, interest or otherwise as such Lender in its sole discretion shall determine) as may be necessary to compensate such Lender for any such increased cost or reduction in amounts received or receivable hereunder.  Such Lender shall deliver to Borrower (with a copy to

 

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Administrative Agent) a written statement, setting forth in reasonable detail the basis for calculating the additional amounts owed to such Lender under this Section 2.12(a), which statement shall be conclusive and binding upon all parties hereto absent manifest error.

 

(b)                     Capital Adequacy Adjustment.  In the event that any Lender shall have determined that the adoption, effectiveness, phase in or applicability after the Closing Date of any law, rule or regulation (or any provision thereof) regarding capital adequacy, or any Change in Law, or compliance by any Lender (or its applicable lending office) with any guideline, request or directive regarding capital adequacy (whether or not having the force of law) of any such Governmental Authority, central bank or comparable agency, has or would have the effect of reducing the rate of return on the capital of such Lender or any corporation controlling such Lender as a consequence of, or with reference to, such Lender’s Term Loans, or participations therein or other obligations hereunder with respect to the Term Loans to a level below that which such Lender or such controlling corporation could have achieved but for such adoption, effectiveness, phase in, applicability, change or compliance (taking into consideration the policies of such Lender or such controlling corporation with regard to capital adequacy), then from time to time, within five Business Days after receipt by Borrower from such Lender of the statement referred to in the next sentence, the Borrower shall pay to such Lender such additional amount or amounts as will compensate such Lender or such controlling corporation on an after-tax basis for such reduction.  Such Lender shall deliver to Borrower (with a copy to Administrative Agent) a written statement, setting forth in reasonable detail the basis for calculating the additional amounts owed to Lender under this Section 2.12(b), which statement shall be conclusive and binding upon all parties hereto absent manifest error.

 

2.13                        Taxes; Withholding, etc.

 

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

 

(b)                     Withholding of Taxes.  If any Withholding Agent is required by law to make any deduction, withholding or payment on account of any Tax from any sum paid or payable under any of the Credit Documents: (i) Borrower shall notify Administrative Agent if it becomes aware of any such requirement or any change in any such requirement promptly after Borrower becomes aware of it; (ii) the applicable Withholding Agent shall be entitled to make such deduction or withholding and shall timely pay the full amount deducted or withheld to the relevant Governmental Authority in accordance with applicable law; (iii) if such Tax is an Indemnified Tax, the sum payable by such Credit Party in respect of which the relevant deduction, withholding or payment is required shall be increased to the extent necessary to ensure that, after the making of such deduction, withholding or payment, Administrative Agent or such Lender, as the case may be, receives on the due date a net sum equal to what it would have received had no such deduction, withholding or payment been required or made; and (iv) as soon as practicable after making any such deduction, withholding or payment of any Tax which is required by clause (i) above to be paid, Borrower shall deliver to Administrative Agent evidence satisfactory to Administrative Agent of such payment and of the remittance thereof to the relevant taxing or other authority.

 

(c)                      Other Taxes.  In addition, the Credit Parties shall pay all Other Taxes to the relevant Governmental Authorities in accordance with applicable law.  The Credit Parties shall, upon request of the Administrative Agent, deliver to Administrative Agent official receipts or other evidence of such payment reasonably satisfactory to Administrative Agent in respect of any Taxes or Other Taxes payable hereunder promptly after payment of such Taxes or Other Taxes.

 

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(d)                     Indemnification.  Without duplication of Section 2.13(b), the Credit Parties shall indemnify each Agent and each Lender, within ten (10) 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) payable or paid by such Agent or such Lender or their respective Tax Related Persons, as the case may be (or required to be withheld or deducted from a payment to such Person), relating to, arising out of, or in connection with any Credit Document or any payment or transaction contemplated hereby or thereby, whether or not such Taxes were correctly or legally imposed or asserted by the relevant Governmental Authority, and all reasonable costs and expenses arising therefrom or with respect thereto or incurred in enforcing the provisions of this Section 2.13.  A certificate from the relevant Lender or Agent, setting forth in reasonable detail the basis and calculation of such Taxes shall be conclusive, absent manifest error.

 

(e)                      Evidence of Exemption From U.S.  Withholding Tax. Each Lender that is not a “United States person” (as such term is defined in Section 7701(a)(30) of the Internal Revenue Code) for U.S. federal income tax purposes (a “Non-U.S. Lender”) shall deliver to Administrative Agent for its own account and for transmission to Borrower, on or prior to the Closing Date (in the case of each Lender listed on the signature pages hereof on the Closing Date) or on or prior to the date of the Assignment Agreement pursuant to which it becomes a Lender (in the case of each other Lender), and at such other times as may be necessary in the determination of Borrower or Administrative Agent (each in the reasonable exercise of its discretion), (i) two original copies of Internal Revenue Service Form W-8BEN, W-8BEN-E, W-8IMY or W-8ECI (or any successor forms), properly completed and duly executed by such Lender, together with any applicable attachments (including, if such Lender is not the beneficial owner and such beneficial owner(s) would be described by clause (ii) below if it were a Lender, a certificate substantially similar to the Certificate Regarding Non-Bank Status from such beneficial owner), and such other documentation required under the Internal Revenue Code and reasonably requested by Administrative Agent or Borrower to establish that such Lender is not subject to deduction or withholding of United States federal income tax with respect to any payments to such Lender of principal, interest, fees or other amounts payable under any of the Credit Documents or is subject to deduction or withholding at a reduced rate, or (ii) if such Lender is not a “bank” or other Person described in Section 881(c)(3) of the Internal Revenue Code and cannot deliver Internal Revenue Service Form W-8ECI pursuant to clause (i) above, a Certificate Regarding Non-Bank Status together with two original copies of Internal Revenue Service Form W-8BEN or W-8BEN-E (or any successor form), properly completed and duly executed by such Lender, and such other documentation required under the Internal Revenue Code and reasonably requested by Administrative Agent or Borrower to establish that such Lender is not subject to deduction or withholding of United States federal income tax with respect to any payments to such Lender of interest payable under any of the Credit Documents.  Each Lender required to deliver any forms, certificates or other evidence with respect to United States federal income tax withholding matters pursuant to this Section 2.13(e) hereby agrees, from time to time after the initial delivery by such Lender of such forms, certificates or other evidence, whenever a lapse in time or change in circumstances renders such forms, certificates or other evidence obsolete or inaccurate in any material respect, that such Lender shall promptly deliver to Administrative Agent for its own account and for transmission to Borrower two new original copies of Internal Revenue Service Form W-8BEN, W-8BEN-E, W-8IMY or W-8ECI, or a Certificate Regarding Non-Bank Status and two original copies of Internal Revenue Service Form W-8BEN or W-8BEN-E (or any successor form), as the case may be, properly completed and duly executed by such Lender, together with any applicable attachments, and such other documentation required under the Internal Revenue Code and reasonably requested by Administrative Agent or Borrower to confirm or establish that such Lender is not subject to deduction or withholding of United States federal income tax with respect to payments to such Lender under the Credit Documents or is subject to deduction or withholding at a reduced rate, or notify Administrative Agent and Borrower of its inability to deliver any such forms, certificates or other evidence.  Nothing in this Section 2.13 shall be

 

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construed to require a Lender, Agent or Participant to provide any forms or documentation that it is not legally entitled to provide.

 

(f)                       Each of the Administrative Agent and any Lender that is not a Non-U.S. Lender shall deliver to Administrative Agent for its own account and for transmission to Borrower (in such number of copies as shall be requested by the recipient) on or prior to the date on which such Lender becomes an Administrative Agent or a Lender under this Agreement (and from time to time thereafter as prescribed by applicable law or upon the request of Administrative Agent or Borrower), duly executed and properly completed copies of Internal Revenue Service Form W-9 certifying that such Administrative Agent or Lender is entitled to an exemption from U.S. backup withholding tax.

 

(g)                      Each Lender shall deliver to Administrative Agent for its own account and for transmission to Borrower, upon its reasonable request, such other tax forms or other documents as shall be prescribed by applicable law and such additional documentation reasonably requested by Administrative Agent or Borrower as may be necessary for such Person to comply with its obligations under FATCA and to determine that such Lender has complied with such Lender’s obligations under FATCA or to determine the amount to deduct and withhold from payments under this Agreement and the Credit Documents to such Lender or to demonstrate, where applicable, that payments under this Agreement and the Credit Documents to such Lender are exempt from application of the U.S. withholding tax imposed pursuant to FATCA. Solely for purposes of this subsection (g), “FATCA” shall include any amendments made to FATCA after the date of this Agreement.

 

(h)                     If the Lender determines, in its sole discretion, that it has received a refund of or credit against any Taxes with respect to which Borrower has paid additional amounts pursuant to this Section 2.13 it shall pay over such refund or credit to Borrower (but only to the extent of amounts paid by Borrower under this Section 2.13), net of all out-of-pocket expenses of the Lender and without interest (other than any interest paid by the relevant Governmental Authority with respect to such refund or credit). Borrower, upon the request of such Lender, shall repay to such Lender the amount paid over pursuant to this paragraph (h) (plus any penalties, interest or other charges imposed by the relevant Governmental Authority) in the event that such Lender is required to repay such refund to such Governmental Authority.  Notwithstanding anything to the contrary in this paragraph (h), in no event will the Lender be required to pay any amount to Borrower pursuant to this paragraph (h) the payment of which would place the Lender in a less favorable net after-Tax position than the Lender 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 paragraph shall not be construed to require any Lender to make available its Tax returns (or any other information that it deems confidential or proprietary) to Borrower or any other Person.

 

(i)                         Each Lender agrees that if any form or certification it previously delivered expires or becomes obsolete or inaccurate in any respect, it shall update such form or certification or promptly notify Administrative Agent and Borrower in writing of its legal inability to do so.

 

SECTION 3.            CONDITIONS PRECEDENT

 

3.1                               Closing Date.  The obligation of each Lender to make a Term Loan on the Closing Date is subject to the satisfaction, or waiver in accordance with Section 10.5, of the following conditions on or before the Closing Date:

 

(a)                     Credit Documents.  Administrative Agent and the Lenders shall each have received copies of each of the following Credit Documents originally executed and delivered by each

 

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applicable Credit Party, with the originals of each such Credit Document being delivered to Administrative Agent: (i) this Agreement, (ii) if requested by any Lender, a Term Loan Note for such Lender, (iii) the Agent Fee Letter, and (iv) the Pledge Agreement.

 

(b)                     Organizational Documents; Incumbency; Tax Forms.  Administrative Agent and each Lender shall have received (i) a copy of each Organizational Document of each Credit Party, to the extent applicable, certified as of a recent date by the appropriate governmental official, each dated the Closing Date or a recent date prior thereto; (ii) signature and incumbency certificates of the officers of such Person executing the Credit Documents to which it is a party; (iii) resolutions of the Board of Directors or similar governing body of each Credit Party approving and authorizing the execution, delivery and performance of this Agreement and the other Credit Documents to which it is a party or by which it or its assets may be bound as of the Closing Date, certified as of the Closing Date by its secretary or an assistant secretary as being in full force and effect without modification or amendment; (iv) a good standing certificate from the applicable Governmental Authority of each Credit Party’s jurisdiction of incorporation, organization or formation and in each jurisdiction in which it is qualified as a foreign corporation or other entity to do business, each dated a recent date prior to the Closing Date; (v)  a completed and executed IRS Form W-9 or other applicable tax form for the Borrower; and (vi) such other documents as Administrative Agent may reasonably request.

 

(c)                      Budget.  Houlihan Lokey, Inc. shall have received from Holdings the initial Budget.

 

(d)                     Opinions of Counsel to Credit Parties.  Lenders and their respective counsel shall have received originally executed copies of the favorable written opinions of Kirkland & Ellis, LLP, counsel for Credit Parties, and Holland & Knight, Florida counsel to the Credit Parties, each dated as of the Closing Date and covering such matters as Administrative Agent or the Lenders may reasonably request and otherwise in form and substance reasonably satisfactory to Administrative Agent and the Lenders (and each Credit Party hereby instructs such counsel to deliver such opinions to Agents and Lenders).

 

(e)                      Solvency Certificate.  On the Closing Date, Administrative Agent and each Lender shall have received a Solvency Certificate from the Borrower dated as of the Closing Date and addressed to Administrative Agent and Lenders, and in form, scope and substance satisfactory to Administrative Agent and the Lenders, with appropriate attachments and demonstrating that after giving effect to the Credit Extensions to be made on the Closing Date, Borrower and its Subsidiaries on a consolidated basis are and will be Solvent.

 

(f)                       Closing Date Certificate.  The Borrower shall have delivered to Administrative Agent and each Lender an originally executed Closing Date Certificate, together with all attachments thereto.

 

(g)                      Completion of Proceedings.  All partnership, corporate and other proceedings taken or to be taken in connection with the transactions contemplated hereby and all documents incidental thereto not previously found acceptable by the Lenders and their counsel shall be satisfactory in form and substance to the Lenders and such counsel, and the Lenders, and such counsel shall have received all such counterpart originals or certified copies of such documents as the Lenders may reasonably request.

 

(h)                     Background Checks.  The Lenders or Administrative Agent shall have performed customary individual background checks, including customary Patriot Act searches and OFAC searches, at the discretion of Administrative Agent and the Lenders, the results of which are

 

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satisfactory to Administrative Agent and Lenders.  Administrative Agent and each of the Lenders shall have received, at their discretion, all documentation and other information required by regulatory authorities under applicable “know your customer” and anti-money laundering rules and regulations, including, without limitation, Terrorism Laws and the Patriot Act, not less than two (2) Business Days prior to the Closing Date.

 

(i)                         Funds Flow.  The Administrative Agent and each Lender shall have received prior to the Closing Date a funds flow memorandum, in form and substance reasonably satisfactory to it.

 

(j)                        Recapitalization Support Agreement.  The Administrative Agent and each Lender shall have received a fully executed copy of the Recapitalization Agreement.

 

(k)                     Senior Debt.  The Lenders shall be satisfied that the Guaranty by each Guarantor of the Term Loans and the Guaranteed Obligations of each Guarantor constitute Senior Debt (as defined in the Subordinated Notes Indenture) in the case of the Company (as defined in the Subordinated Notes Indenture), and Guarantor Senior Debt (as defined in the Subordinated Notes Indenture), in the case of each Guarantor (as defined in the Subordinated Notes Indenture), and the Administrative Agent and the Lenders shall have received an officers’ certificate of 21C to the effect that the incurrence of the Guaranties under this Agreement on the Closing Date does not violate the Subordinated Notes Indenture.

 

(l)                         Financial Statements.  Each of the Lenders and the Administrative Agent shall have received from Borrower (i) the audited combined special purpose financial statements of the operating entities of Medical Developers, LLC, for the years ended December 31, 2012 and December 31, 2013, consisting of balance sheets and the related statements of income, stockholders’ equity and cash flows for such years, and (ii) for the interim period from December 31, 2013 to the Closing Date, internally prepared, unaudited combined special purpose financial statements of the operating entities of Medical Developers, LLC, consisting of a balance sheet and the related statements of income, stockholders’ equity and cash flows for each monthly period through May, 2014 in the case of clauses (i) and (ii), certified by the treasurer of Borrower that they fairly present, in all material respects, the financial condition of the operating entities of Medical Developers, LLC as at the dates indicated and the results of their operations and their cash flows for the periods indicated, subject, if applicable, to changes resulting from audit and normal year-end adjustments.

 

3.2                               Additional Conditions to Credit Extension.

 

(a)                     Additional Conditions Precedent.  The obligation of each Lender to make any Term Loan on the Closing Date or any other Credit Date is subject to the satisfaction, or waiver in accordance with Section 10.5, of the following additional conditions precedent:

 

(i)                                          Administrative Agent shall have received a fully executed and delivered Funding Notice;

 

(ii)                                       as of the Closing Date or such Credit Date, as applicable, the representations and warranties contained herein and in the other Credit Documents shall be true and correct in all material respects (except such representations and warranties that by their terms are qualified by materiality, which representations and warranties shall be true and correct in all respects) on and as of that Credit Date to the same extent as though made on and as of that date (or to the extent such representations and warranties specifically relate to an earlier date on and as of such earlier date);

 

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(iii)                               as of the Closing Date or such Credit Date, no event shall have occurred and be continuing or would result from the consummation of the Credit Extension that would constitute an Event of Default or a Default;

 

(iv)                              the Administrative Agent and the Lenders shall have received evidence satisfactory to the Lenders that the Recapitalization Agreement continues to be in full force and effect; and

 

(v)                                 the amendment of the corporate organizational documents of Investments to provide that Investments cannot commence the Chapter 11 Cases (as defined in the Recapitalization Agreement) or cause either or both of Holdings and 21C or any of 21C’s direct or indirect subsidiaries (other than the Subsidiaries of 21C East Florida, LLC) to commence the Chapter 11 Cases without the votes of the Independent Manager (as defined in the Recapitalization Agreement) and the Chief Executive Officer (as defined in the Recapitalization Agreement) in support of such action.

 

Any Agent or Requisite Lenders shall be entitled, but not obligated, to request and receive, prior to the making of the Term Loan, additional information reasonably satisfactory to the requesting party confirming the satisfaction of any of the foregoing if, in the good faith judgment of such Agent or Requisite Lender such request is warranted under the circumstances.

 

(b)                     Funding Notice.  The Funding Notice shall be executed by an Authorized Officer in a writing delivered to Administrative Agent.

 

SECTION 4.             REPRESENTATIONS AND WARRANTIES

 

In order to induce Lenders to enter into this Agreement and to make the Term Loans to be made hereby, each Credit Party represents and warrants to each Lender, on the Closing Date and every other Credit Date, that the following statements are true and correct:

 

4.1                               Organization; Requisite Power and Authority; Qualification.  Each Credit Party (a) is duly organized, validly existing and in good standing under the laws of its jurisdiction of organization as identified in Schedule 4.1, (b) has all requisite power and authority to own and operate its properties, to carry on its business as now conducted and as proposed to be conducted, to enter into the Credit Documents to which it is a party and to carry out the transactions contemplated thereby and, in the case of the Borrower, to make the borrowings hereunder, and (c) is qualified to do business and in good standing in every jurisdiction where its assets are located and wherever necessary to carry out its business and operations except where failure to do so would not result in a Material Adverse Effect.

 

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

 

4.3                               No Conflict.  The execution, delivery and performance by each of the Credit Parties of the Credit Documents to which they are parties and the consummation of the transactions contemplated by the Credit Documents do not and will not (a) violate any provision of any law or any governmental rule or regulation applicable to such Credit Party, any of the Organizational Documents of such Credit Party, or any order, judgment or decree of any court or other agency of government binding on such Credit Party; (b) conflict with, result in a breach of or constitute (with due notice or lapse of time or both) a default under any material contractual obligation of such Credit Party (including, without limitation, the Senior Secured Credit Agreement and the 21C Indentures); (c) result in or require the creation or imposition of any Lien upon any of the properties or assets of such Credit Party (other than any Liens

 

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created under any of the Credit Documents in favor of Collateral Agent, on behalf of the Secured Parties); (d) result in any default, noncompliance, suspension, revocation, impairment, forfeiture or nonrenewal of any permit, license, authorization or approval applicable to its operations or any of its properties or (e) require any approval of stockholders, members or partners or any approval or consent of any Person under any contractual obligation of such Credit Party, except for such approvals or consents which will be obtained on or before the Closing Date and disclosed in writing to Lenders and stockholder and member consents to be obtained after the Closing Date and described on Schedule 5.5.

 

4.4                               Governmental Consents.  The execution, delivery and performance by each of the Credit Parties of the Credit Documents to which they are parties and the consummation of the transactions contemplated by the Credit Documents do not and will not require any registration with, consent or approval of, or notice to, or other action to, with or by, any Governmental Authority except for filings and recordings with respect to the Collateral to be made, or otherwise delivered to Collateral Agent for filing and/or recordation, as of the Closing Date.

 

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

 

4.6                               Governmental Regulation.  Neither Holdings nor any of its Subsidiaries is subject to regulation under the Investment Company Act of 1940 or under any other federal or state statute or regulation which may limit its ability to incur Indebtedness or which may otherwise render all or any portion of the Obligations unenforceable.  Neither Holdings nor any of its Subsidiaries is a “registered investment company” or a company “controlled” by a “registered investment company” or a “principal underwriter” of a “registered investment company” as such terms are defined in the Investment Company Act of 1940.

 

4.7                               Margin Stock.  Neither Holdings nor any of its Subsidiaries is engaged in the business of extending credit for the purpose of purchasing or carrying any Margin Stock.  No part of the proceeds of the Term Loans made to such Credit Party will be used to purchase or carry any such Margin Stock or to extend credit to others for the purpose of purchasing or carrying any such Margin Stock or for any purpose that violates, or is inconsistent with, the provisions of Regulation T, U or X of the Board of Governors of the Federal Reserve System.

 

4.8                               Solvency.  Borrower and its Subsidiaries on a consolidated basis are and will be Solvent.

 

4.9                               Terrorism Laws and FCPA.

 

(a)                     None of the Credit Parties is in violation of any Terrorism Law or engages in any transaction that evades or avoids or attempts to violate any of the Terrorism Laws.

 

(b)                     None of the Credit Parties nor any of their Subsidiaries is any of the following (each, a “Blocked Person”):  (i) a Person that is prohibited pursuant to any of the OFAC Sanctions Programs, including a Person named on OFAC’s list of Specially Designated Nationals and Blocked Persons; (ii) a Person that is owned or controlled by, or that owns and controls any Person described in (i) above; or (iii) a Person with which any Lender is prohibited from dealing or otherwise engaging in any transaction by any Terrorism Law.

 

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(c)                      None of the Credit Parties, nor any of their Subsidiaries deals in, or otherwise engages in any transaction relating to, any property or interests in property blocked pursuant to any OFAC Sanctions Programs.

 

(d)                     No part of the proceeds of the Term Loans will be used, directly or indirectly, in furtherance of any offer, payment, promise to pay, or authorization of the payment of money or anything else of value to any governmental official or employee, political party, official of a political party, candidate for political office, or anyone else in violation of the United States Foreign Corrupt Practices Act of 1977, as amended (the “FCPA”), or any other anti-bribery law.  No Credit Party, nor any of its Subsidiaries nor any of their respective officers, directors or employees, nor, to its knowledge, any of its agents or representatives, has:  (i) directly or indirectly, made an “unlawful payment” within the meaning of, and is not in any other way in violation of, the FCPA or similar laws in any jurisdiction; (ii) used any corporate funds for any unlawful contribution, gift, entertainment or unlawful expense relating to political activity; (iii) made any direct or indirect unlawful payment to any foreign or domestic government official or employee from corporate funds; or (iv) paid any bribe, rebate, pay-off, influence payment, kick-back or other unlawful payment.

 

4.10                        Security Interest in Collateral.  The provisions of this Agreement and the other Credit Documents create legal and valid Liens on all the Collateral in favor of Collateral Agent, for the benefit of Collateral Agent and the Lenders, and such Liens constitute perfected and continuing Liens on the Collateral, securing the Obligations, enforceable against the applicable Credit Party and all third parties, and having priority over all other Liens on the Collateral.

 

4.11                        Other Representations and Warranties.  Except as set forth on Schedule 4.11, each of the representations and warranties contained in the Senior Credit Agreement are true and correct in all respects on and as of that Credit Date to the same extent as though made on and as of that date (or to the extent such representations and warranties specifically relate to an earlier date on and as of such earlier date).

 

4.12                        Senior Debt.  The Guaranties and the Guaranteed Obligations constitute Senior Debt (as defined in the Subordinated Notes Indenture) in the case of the Company (as defined in the Subordinated Notes Indenture) and Guarantor Senior Debt, in the case of the Guarantors (as defined in the Subordinated Notes Indenture).

 

4.13                        Historical Financial Statements.  The historical financial statements delivered to the Administrative Agent pursuant to Section 3.1(l) were prepared in conformity with GAAP and fairly present, in all material respects, the financial position, on a consolidated basis, of the Persons described in such financial statements as at the respective dates thereof and the results of operations and cash flows, on a consolidated basis, of the entities described therein for each of the periods then ended, subject, in the case of any such unaudited financial statements, to changes resulting from audit and normal year-end adjustments.  As of the Closing Date, neither Borrower nor any of its Subsidiaries has any contingent liability or liability for taxes, long term lease or unusual forward or long term commitment that is not reflected in such historical financial statements or the notes thereto and which in any such case is material in relation to the business, operations, properties, assets, condition (financial or otherwise) or prospects of Borrower and any of its Subsidiaries taken as a whole.

 

4.14                        No Material Adverse Change.  Except for financial issues relating to the Company as specifically disclosed to the Lenders on or prior to the Closing Date, since December 31, 2013, no event, circumstance or change has occurred that has caused or evidences, either in any case or in the aggregate, a Material Adverse Effect.

 

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4.15                        Common Enterprise.  The successful operation and condition of each of the Credit Parties is dependent on the continued successful performance of the functions of the group of the Credit Parties as a whole and the successful operation of each of the Credit Parties is dependent on the successful performance and operation of each other Credit Party.  Each Credit Party expects to derive benefit (and its board of directors or other governing body has determined that it may reasonably be expected to derive benefit), directly and indirectly, from (i) successful operations of each of the other Credit Parties and (ii) the credit extended by the Lenders to the Borrower hereunder, both in their separate capacities and as members of the group of companies.  Each Credit Party has determined that execution, delivery, and performance of this Agreement and any other Credit Documents to be executed by such Credit Party is within its purpose, will be of direct and indirect benefit to such Credit Party, and is in its best interest.

 

SECTION 5.             AFFIRMATIVE COVENANTS

 

Each Credit Party covenants and agrees that so long as any Term Loan Commitment is in effect and until payment in full of all Obligations (other than contingent indemnification obligations that by their terms survive termination of the Credit Documents), each Credit Party shall perform, and shall cause each of its Subsidiaries to perform, all covenants in this Section 5.

 

5.1                               Budget and Other Reports.

 

Borrower will deliver to Administrative Agent (which, in case of notices under clause (d), will forward such notices to the Lenders) and, in the case of clauses (a), (b) and (c), Houlihan Lokey, Inc., as advisor to the Lenders:

 

(a)                     Budget. On the last Business Day of each month, an updated Budget for the subsequent 13-week period beginning the Business Day following delivery of such updated Budget (which in each case must be satisfactory to the Lenders in their reasonable discretion), and such updated Budget shall, upon approval of the Lenders or Houlihan Lokey, Inc. (acting at the direction of the Lenders), become the “Budget” for all purposes under this Agreement.

 

(b)                     Variance Report.  With respect to each week, on the third Business Day of such week, a variance report comparing the actual cash receipts and disbursements of 21C and its domestic subsidiaries with the projected receipts and disbursements set forth in the most recent Budget.

 

(c)                      Monthly Reports.  Within thirty (30) days after the end of each month (including June 2014), the combined balance sheet of the operating entities of Medical Developers, LLC as at the end of such month and the related combined statements of income, and stockholders’ equity and year to date cash flows of the operating entities of Medical Developers, LLC, all in reasonable detail, together with any narrative report with respect thereto and any other operating reports prepared by management for such period.

 

(d)                     Certain Notices.  With reasonable promptness, written notice of (i) any change in the board of directors (or similar governing body) of Holdings or Borrower, (ii) the occurrence of any Material Adverse Effect, (iii) the receipt of the Equity Contribution, and (iv) the occurrence of an Event of Default.

 

5.2                               Existence.  Each Credit Party will, and will cause each of its Subsidiaries to, at all times preserve and keep in full force and effect its existence and all rights and governmental authorizations, qualifications, franchises, licenses and permits material to its business and to conduct its business in each jurisdiction in which its business is conducted; provided, no Credit Party other than the Borrower or any

 

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of their Subsidiaries shall be required to preserve any such existence, right or governmental authorizations, qualifications, franchise, licenses and permits if such Person has total assets of $25,000 or less and such Person’s board of directors (or similar governing body) shall determine that the preservation thereof is no longer desirable in the conduct of the business of such Person, and that the loss thereof is not disadvantageous in any material respect to such Person or to Lenders.

 

5.3                               Subsidiaries.  In the event that any Subsidiary or Affiliate of Holdings becomes an obligor under the Senior Credit Agreement or the 21C Notes after the Closing Date, the Borrower shall cause such Subsidiary or Affiliate to become a Guarantor hereunder by executing and delivering to Administrative Agent a Counterpart Agreement or executing and delivering a guarantee of the Obligations in form and substance satisfactory to Administrative Agent.

 

5.4                               Use of Proceeds.  The proceeds of the Term Loans will be used only for the purposes described in Section 2.3.  No part of the proceeds of any Term Loan will be used, whether directly or indirectly, for any purpose that entails a violation of any law, including Regulations T, U and X of the Board of Governors of the Federal Reserve System.

 

5.5                               Post Closing Matters.  Borrower shall, and shall cause each of the Credit Parties to, satisfy the requirements set forth on Schedule 5.5 on or before the date specified for such requirement.

 

SECTION 6.             NEGATIVE COVENANTS

 

Each Credit Party covenants and agrees that, so long as any Term Loan Commitment is in effect and until payment in full of all Obligations (other than contingent indemnification obligations that by their terms survive termination of the Credit Documents), such Credit Party shall perform, and shall cause each of its Subsidiaries to perform, all covenants in this Section 6.

 

6.1                               Non-Ordinary Course Transactions.  Holdings shall not, and shall not permit any of its Subsidiaries (other than the Subsidiaries of 21C East Florida, LLC) to engage in any transaction (other than in the ordinary course of business consistent with past practice in all material respects) without the consent of the Lenders in their sole discretion.

 

6.2                               Amendments to Certain Agreements.  Except for amendments or supplements necessary to effectuate the Restructuring (as defined in the Recapitalization Agreement) or to enable Subsidiaries of Holdings to become guarantors under the Senior Credit Agreement and the 21C Indentures to the extent required by the Senor Credit Agreement and the 21C Indentures, no Credit Party shall amend, modify or supplement or permit any amendments, modifications or supplements to, or waivers of, the Senior Credit Agreement or the 21C Indentures.

 

6.3                               Permitted Activities of Borrower.  Borrower shall not (a) incur, directly or indirectly, any indebtedness or any other obligation or liability whatsoever other than (i) the indebtedness and obligations under this Agreement and the other Credit Documents to which it is a party and (ii) taxes and other obligations incurred in the ordinary course consistent with past practice; (b) create or suffer to exist any Lien upon any property or assets now owned or hereafter acquired by it other than the Liens created under the Collateral Documents to which it is a party (other than Liens for Taxes that are not overdue, or in the case of Tax Liens that are overdue, do not exceed $50,000, are being contested in good faith by appropriate proceedings and with respect to which adequate reserves are maintained on the books of the Borrower or its Subsidiaries); (c) engage in any business or activity or own any assets other than (i) holding one hundred percent (100%) of the Capital Stock of Medical Developers Cooperatief; and (ii) performing its obligations and activities incidental thereto under the Credit Documents; (d) consolidate with or merge with or into, or convey, transfer or lease all or substantially all its assets to,

 

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any Person; (e) sell or otherwise dispose of any Capital Stock of any of its Subsidiaries; (f) create or acquire any Subsidiary or make or own any investment in any Person other than Medical Developers Cooperatief; or (g) fail to hold itself out to the public as a legal entity separate and distinct from all other Persons.

 

SECTION 7.             GUARANTY

 

7.1                               Guaranty of the Obligations.  Subject to the provisions of Section 7.2, Guarantors jointly and severally hereby irrevocably and unconditionally guaranty to Administrative Agent for the ratable benefit of the Beneficiaries the due and punctual payment in full of all Obligations when the same shall become due, whether at stated maturity, by required prepayment, declaration, acceleration, demand or otherwise (including amounts that would become due but for the operation of the automatic stay under Section 362(a) of the Bankruptcy Code, 11 U.S.C. §362(a)) (collectively, the “Guaranteed Obligations”).

 

7.2                               Contribution by Guarantors.  All Guarantors desire to allocate among themselves (collectively, the “Contributing Guarantors”), in a fair and equitable manner, their obligations arising under this Guaranty.  Accordingly, in the event any payment or distribution is made on any date by a Guarantor (a “Funding Guarantor”) under this Guaranty such that its Aggregate Payments exceeds its Fair Share as of such date, such Funding Guarantor shall be entitled to a contribution from each of the other Contributing Guarantors in an amount sufficient to cause each Contributing Guarantor’s Aggregate Payments to equal its Fair Share as of such date.  “Fair Share” means, with respect to a Contributing Guarantor as of any date of determination, an amount equal to (a) the ratio of (i) the Fair Share Contribution Amount with respect to such Contributing Guarantor, to (ii) the aggregate of the Fair Share Contribution Amounts with respect to all Contributing Guarantors multiplied by, (b) the aggregate amount paid or distributed on or before such date by all Funding Guarantors under this Guaranty in respect of the obligations Guaranteed.  “Fair Share Contribution Amount” means, with respect to a Contributing Guarantor as of any date of determination, the maximum aggregate amount of the obligations of such Contributing Guarantor under this Guaranty that would not render its obligations hereunder or thereunder subject to avoidance as a fraudulent transfer or conveyance under Section 548 of the Bankruptcy Code or any comparable applicable provisions of state law; provided, solely for purposes of calculating the Fair Share Contribution Amount with respect to any Contributing Guarantor for purposes of this Section 7.2, any assets or liabilities of such Contributing Guarantor arising by virtue of any rights to subrogation, reimbursement or indemnification or any rights to or obligations of contribution hereunder shall not be considered as assets or liabilities of such Contributing Guarantor.  “Aggregate Payments” means, with respect to a Contributing Guarantor as of any date of determination, an amount equal to (1) the aggregate amount of all payments and distributions made on or before such date by such Contributing Guarantor in respect of this Guaranty (including in respect of this Section 7.2), minus (2) the aggregate amount of all payments received on or before such date by such Contributing Guarantor from the other Contributing Guarantors as contributions under this Section 7.2.  The amounts payable as contributions hereunder shall be determined as of the date on which the related payment or distribution is made by the applicable Funding Guarantor.  The allocation among Contributing Guarantors of their obligations as set forth in this Section 7.2 shall not be construed in any way to limit the liability of any Contributing Guarantor hereunder.  Each Guarantor is a third party beneficiary to the contribution agreement set forth in this Section 7.2.

 

7.3                               Payment by Guarantors.  Subject to Section 7.2, Guarantors hereby jointly and severally agree, in furtherance of the foregoing and not in limitation of any other right which any Beneficiary may have at law or in equity against any Guarantor by virtue hereof, that upon the failure of any Borrower to pay any of the Guaranteed Obligations when and as the same shall become due, whether at stated maturity, by required prepayment, declaration, acceleration, demand or otherwise (including

 

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amounts that would become due but for the operation of the automatic stay under Section 362(a) of the Bankruptcy Code, 11 U.S.C. §362(a)), Guarantors will upon demand pay, or cause to be paid, in Cash, to Administrative Agent for the ratable benefit of Beneficiaries, an amount equal to the sum of the unpaid principal amount of all Guaranteed Obligations then due as aforesaid, accrued and unpaid interest on such Guaranteed Obligations (including interest which, but for any Borrower’s becoming the subject of a case under the Bankruptcy Code, would have accrued on such Guaranteed Obligations, whether or not a claim is allowed against any Borrower for such interest in the related bankruptcy case) and all other Guaranteed Obligations then owed to Beneficiaries as aforesaid.

 

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

 

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

 

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

 

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

 

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

 

(e)                      any Beneficiary, upon such terms as it deems appropriate, without notice or demand and without affecting the validity or enforceability hereof or giving rise to any reduction, limitation, impairment, discharge or termination of any Guarantor’s liability hereunder, from time to time may (i) renew, extend, accelerate, increase the rate of interest on, or otherwise change the time, place, manner or terms of payment of the Guaranteed Obligations; (ii) settle, compromise, release or discharge, or accept or refuse any offer of performance with respect to, or substitutions for, the Guaranteed Obligations or any agreement relating thereto and/or subordinate the payment of the same to the payment of any other obligations; (iii) request and accept other guaranties of the Guaranteed Obligations and take and hold security for the payment hereof or the Guaranteed Obligations; (iv) release, surrender, exchange, substitute, compromise, settle, rescind, waive, alter, subordinate or modify, with or without consideration, any security for payment of the Guaranteed Obligations, any other guaranties of the Guaranteed Obligations, or any other obligation of any Person (including any other Guarantor) with respect to the Guaranteed Obligations; (v) enforce and apply any security now or hereafter held by or for the benefit of such Beneficiary in respect hereof or the Guaranteed Obligations and direct the order or

 

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manner of sale thereof, or exercise any other right or remedy that such Beneficiary may have against any such security, in each case as such Beneficiary in its discretion may determine consistent herewith and any applicable security agreement, including foreclosure on any such security pursuant to one or more judicial or nonjudicial sales, whether or not every aspect of any such sale is commercially reasonable, and even though such action operates to impair or extinguish any right of reimbursement or subrogation or other right or remedy of any Guarantor against any Borrower or any security for the Guaranteed Obligations; and (vi) exercise any other rights available to it under the Credit Documents; and

 

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

 

7.5                               Waivers by Guarantors.  Each Guarantor hereby waives, for the benefit of Beneficiaries: (a) any right to require any Beneficiary, as a condition of payment or performance by such Guarantor, to (i) proceed against any Borrower, any other guarantor (including any other Guarantor) of the Guaranteed Obligations or any other Person, (ii) proceed against or exhaust any security held from any Borrower, any such other guarantor or any other Person, (iii) proceed against or have resort to any balance of any Deposit Account or credit on the books of any Beneficiary in favor of any Borrower or any other Person, or (iv) pursue any other remedy in the power of any Beneficiary whatsoever; (b) any defense arising by reason of the incapacity, lack of authority or any disability or other defense of any Borrower or any other Guarantor including any defense based on or arising out of the lack of validity or the unenforceability of the Guaranteed Obligations or any agreement or instrument relating thereto or by reason of the cessation of the liability of any Borrower or any other Guarantor from any cause other than payment in full of the Guaranteed Obligations; (c) any defense based upon any statute or rule of law which provides that the obligation of a surety must be neither larger in amount nor in other respects more

 

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burdensome than that of the principal; (d) any defense based upon any Beneficiary’s errors or omissions in the administration of the Guaranteed Obligations, except behavior which amounts to bad faith; (e) (i) any principles or provisions of law, statutory or otherwise, which are or might be in conflict with the terms hereof and any legal or equitable discharge of such Guarantor’s obligations hereunder, (ii) the benefit of any statute of limitations affecting such Guarantor’s liability hereunder or the enforcement hereof, (iii) any rights to set offs, recoupments and counterclaims, and (iv) promptness, diligence and any requirement that any Beneficiary protect, secure, perfect or insure any security interest or lien or any property subject thereto; (f) notices, demands, presentments, protests, notices of protest, notices of dishonor and notices of any action or inaction, including acceptance hereof, notices of default hereunder or any agreement or instrument related thereto, notices of any renewal, extension or modification of the Guaranteed Obligations or any agreement related thereto, notices of any extension of credit to any Borrower and notices of any of the matters referred to in Section 7.4 and any right to consent to any thereof; and (g) any defenses or benefits that may be derived from or afforded by law which limit the liability of or exonerate guarantors or sureties, or which may conflict with the terms hereof.

 

7.6                               Guarantors’ Rights of Subrogation, Contribution, etc.  Until the Guaranteed Obligations shall have been paid in full (other than contingent indemnification obligations that by their terms survive termination of the Credit Documents), each Guarantor hereby waives any claim, right or remedy, direct or indirect, that such Guarantor now has or may hereafter have against any Borrower or any other Guarantor or any of its assets in connection with this Guaranty or the performance by such Guarantor of its obligations hereunder, in each case whether such claim, right or remedy arises in equity, under contract, by statute, under common law or otherwise and including without limitation (a) any right of subrogation, reimbursement or indemnification that such Guarantor now has or may hereafter have against any Borrower with respect to the Guaranteed Obligations, (b) any right to enforce, or to participate in, any claim, right or remedy that any Beneficiary now has or may hereafter have against any Borrower, and (c) any benefit of, and any right to participate in, any collateral or security now or hereafter held by any Beneficiary.  In addition, until the Guaranteed Obligations (other than contingent indemnification obligations that by their terms survive termination of the Credit Documents) shall have been paid in full, each Guarantor shall withhold exercise of any right of contribution such Guarantor may have against any other guarantor (including any other Guarantor) of the Guaranteed Obligations, including any such right of contribution as contemplated by Section 7.2.  Each Guarantor further agrees that, to the extent the waiver or agreement to withhold the exercise of its rights of subrogation, reimbursement, indemnification and contribution as set forth herein is found by a court of competent jurisdiction to be void or voidable for any reason, any rights of subrogation, reimbursement or indemnification such Guarantor may have against any Borrower or against any collateral or security, and any rights of contribution such Guarantor may have against any such other guarantor, shall be junior and subordinate to any rights any Beneficiary may have against any Borrower, to all right, title and interest any Beneficiary may have in any such collateral or security, and to any right any Beneficiary may have against such other guarantor.  If any amount shall be paid to any Guarantor on account of any such subrogation, reimbursement, indemnification or contribution rights at any time when all Guaranteed Obligations (other than contingent indemnification obligations that by their terms survive termination of the Credit Documents) shall not have been finally paid in full, such amount shall be held in trust for Administrative Agent on behalf of Beneficiaries and shall forthwith be paid over to Administrative Agent for the benefit of Beneficiaries to be credited and applied against the Guaranteed Obligations, whether matured or unmatured, in accordance with the terms hereof.

 

7.7                               Subordination of Other Obligations.  Any Indebtedness of the Borrower or any Guarantor now or hereafter held by any Guarantor (the “Obligee Guarantor”) is hereby subordinated in right of payment to the Guaranteed Obligations, and any such indebtedness collected or received by the Obligee Guarantor after an Event of Default has occurred and is continuing shall be held in trust for Administrative Agent on behalf of Beneficiaries and shall forthwith be paid over to Administrative Agent

 

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for the benefit of Beneficiaries to be credited and applied against the Guaranteed Obligations but without affecting, impairing or limiting in any manner the liability of the Obligee Guarantor under any other provision hereof.

 

7.8                               Continuing Guaranty.  This Guaranty is a continuing guaranty and shall remain in effect until all of the Guaranteed Obligations (other than contingent indemnification obligations that by their terms survive termination of the Credit Documents) shall have been paid in full.  Each Guarantor hereby irrevocably waives any right to revoke this Guaranty as to future transactions giving rise to any Guaranteed Obligations.

 

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

 

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

 

7.11                        Bankruptcy, etc.

 

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

 

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

 

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or allow the claim of Administrative Agent in respect of, any such interest accruing after the date on which such case or proceeding is commenced.

 

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

 

SECTION 8.             EVENTS OF DEFAULT

 

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

 

(a)                     Failure to Make Payments When Due.  Failure by Borrower to pay (i) when due the principal of any Term Loan whether at stated maturity, by acceleration or otherwise; (ii) when due any installment of principal of any Term Loan, by notice of voluntary prepayment or otherwise; or (iii) when due any interest on any Term Loan or any fee or any other amount due hereunder.

 

(b)                     Default in Other Agreements.  (i) Failure of any Credit Party or any of their respective Subsidiaries (other than the Subsidiaries of 21C East Florida, LLC) to pay when due any principal of or interest on or any other amount payable in respect of one or more items of indebtedness (other than indebtedness referred to in Section 8.1(a)) in an individual principal amount of $1,000,000 or more with an aggregate principal amount of $2,000,000 or more, in each case beyond the grace period, if any, provided therefore; or (ii) breach or default by any Credit Party or any of their respective Subsidiaries (other than the Subsidiaries of 21C East Florida, LLC) with respect to any other material term of (1) one or more items of indebtedness in the individual or aggregate principal amounts referred to in clause (i) above, or (2) any loan agreement, mortgage, indenture or other agreement relating to such item(s) of indebtedness, in each case beyond the grace period, if any, provided therefore, if the effect of such breach or default is to cause, or to permit the holder or holders of that indebtedness (or a trustee on behalf of such holder or holders), to cause, that indebtedness to become or be declared due and payable (or subject to a compulsory repurchase or redeemable) or to require the prepayment, redemption, repurchase or defeasance of, or to cause any Credit Party or any of its Subsidiaries (other than the Subsidiaries of 21C East Florida, LLC) to make any offer to prepay, redeem, repurchase or defease such indebtedness, prior to its stated maturity or the stated maturity of any underlying obligation, as the case may be; or

 

(c)                      Breach of Certain Covenants.  Failure of any Credit Party to perform or comply with any term or condition contained in (i) Section 2.3, Section 5.2, Section 5.4, Section 5.5 or Section 6 or (ii) Section 5.1 and, in the case of clause (ii), such failure to perform or comply is not remedied or waived within 3 Business Days after the incurrence of such failure; or

 

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

 

(e)                      Other Defaults Under Credit Documents.  Any Credit Party shall default in the performance of or compliance with any term contained herein or any of the other Credit Documents, other than any such term referred to in any other Section of this Section 8.1, and such default

 

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shall not have been remedied or waived within thirty (30) days after the earlier to occur of (i) knowledge by an Authorized Officer of any Borrower of such default or (ii) notice from the Administrative Agent to Borrower of such default; or

 

(f)                       Involuntary Bankruptcy; Appointment of Receiver, etc.  (i) A court of competent jurisdiction shall enter a decree or order for relief in respect of Holdings or any of its Subsidiaries in an involuntary case under the Bankruptcy Code or under any other applicable bankruptcy, insolvency, reorganization, liquidation or similar law now or hereafter in effect, which decree or order is not stayed; or any other similar relief shall be granted under any applicable foreign or domestic federal or state law; or (ii) an involuntary case shall be commenced against Holdings or any of its Subsidiaries under the Bankruptcy Code or under any other applicable bankruptcy, insolvency, reorganization, liquidation or similar law now or hereafter in effect; or a decree or order of a court having jurisdiction in the premises for the appointment of a receiver, liquidator, sequestrator, trustee, custodian or other officer having similar powers over Holdings or any of its Subsidiaries, or over all or a substantial part of its property, shall have been entered; or there shall have occurred the involuntary appointment of an interim receiver, trustee or other custodian of Holdings or any of its Subsidiaries for all or a substantial part of its property; or a warrant of attachment, execution or similar process shall have been issued against any substantial part of the property of Holdings or any of its Subsidiaries, and any such event described in this clause (ii) shall continue for sixty (60) days without having been dismissed, bonded or discharged; or

 

(g)                      Voluntary Bankruptcy; Appointment of Receiver, etc.  (i) Holdings or any of its Subsidiaries shall have an order for relief entered with respect to it or shall commence a voluntary case under the Bankruptcy Code or under any other applicable bankruptcy, insolvency, reorganization, liquidation or similar law now or hereafter in effect, or shall consent to the entry of an order for relief in an involuntary case, or to the conversion of an involuntary case to a voluntary case, under any such law, or shall consent to the appointment of or taking possession by a receiver, trustee or other custodian for all or a substantial part of its property; or Holdings or any of its Subsidiaries shall make any assignment for the benefit of creditors; or (ii) the board of directors (or similar governing body) of Holdings or any of its Subsidiaries (or any committee thereof) shall adopt any resolution or otherwise authorize any action to approve any of the actions referred to herein or in Section 8.1(f); or

 

(h)                     Claims, Judgments and Attachments.  (a) Any money judgment, writ or warrant of attachment or similar process involving (i) in any individual case an amount in excess of $500,000 or (ii) in the aggregate at any time an amount in excess of $1,000,000 (in either case to the extent not fully covered by insurance (less any deductible) as to which a solvent and unaffiliated insurance company with a rating of “A-1” or better by A.M. Best has acknowledged coverage) shall be entered or filed against Holdings or any of its Subsidiaries or any of their respective assets or (b) Holdings or any of its Subsidiaries shall enter into a settlement in respect of any actual or threatened action, suit, investigation, litigation or proceeding or other regulatory or legal development involving (i) in any individual case an amount in excess of $500,000 or (ii) in the aggregate at any time an amount in excess of $1,000,000; or

 

(i)                         Dissolution.  Any order, judgment or decree shall be entered against any Credit Party decreeing the dissolution or split up of such Credit Party and such order shall remain undischarged or unstayed for a period in excess of thirty (30) consecutive days; or

 

(j)                        Guaranties, Collateral Documents and other Credit Documents.  At any time after the execution and delivery thereof, (i) the Guaranty for any reason, other than the satisfaction in full of all Obligations, shall cease to be in full force and effect (other than in accordance with its terms) or shall be declared to be null and void or any Guarantor shall repudiate its obligations thereunder, (ii) this Agreement or any Collateral Document ceases to be in full force and effect (other than by reason of a

 

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release of Collateral in accordance with the terms hereof or thereof or the satisfaction in full of the Obligations in accordance with the terms hereof) or shall be declared null and void, or Collateral Agent shall not have or shall cease to have a valid and perfected Lien in any Collateral purported to be covered by the Collateral Documents with the priority required by the relevant Collateral Document, in each case for any reason other than the failure of Collateral Agent or any Secured Party to take any action within its control, or (iii) any Credit Party shall contest the validity or enforceability of any Credit Document in writing or deny in writing that it has any further liability, including with respect to future advances by Lenders, under any Credit Document to which it is a party; or

 

(k)                     Certain Contracts.  Any party thereto shall default in the performance of any of its obligations under the Recapitalization Agreement, the Senior Credit Agreement or the 21C Indentures (after giving effect to any applicable grace period in the Recapitalization Agreement, the Senior Credit Agreement or the 21C Indentures, as applicable), or any terms of the Senior Credit Agreement shall be modified, amended, or waived (except as permitted by Section 6.2).

 

THEN, (1) upon the occurrence of any Event of Default described in Section 8.1(f) or 8.1(g), automatically, and (2) upon the occurrence of any other Event of Default, upon notice to Borrower by the Administrative Agent (which may be given at its election or at the direction of the Requisite Lenders) with respect to any of all of the following, (A) the Commitments shall terminate, (B) each of the following shall immediately become due and payable, in each case without presentment, demand, protest or other requirements of any kind, all of which are hereby expressly waived by each Credit Party: (I) the unpaid principal amount of and accrued interest on the Term Loans, and (II) all other Obligations; and (C) Administrative Agent may cause Collateral Agent to enforce any and all Liens and security interests created pursuant to Collateral Documents.

 

SECTION 9.             AGENTS

 

9.1                               Appointment.  Each Lender hereby irrevocably designates and appoints the Administrative Agent and Collateral Agent as the agents of such Lender under this Agreement and the other Credit Documents, and each such Lender irrevocably authorizes each of the Administrative Agent and Collateral Agent, in such capacities, to take such actions on its behalf under the provisions of this Agreement and the other Credit Documents and to exercise such powers and perform such duties as are expressly delegated to the Administrative Agent or the Collateral Agent, as the case may be, by the terms of this Agreement and the other Credit Documents, together with such other powers as are reasonably incidental thereto.  Notwithstanding any provision to the contrary elsewhere in this Agreement or any other Credit Document, the Administrative Agent and the Collateral Agent shall not have any duties or responsibilities, except those expressly set forth herein, or any fiduciary relationship with any Lender, and no implied covenants, functions, responsibilities, duties, obligations or liabilities shall be read into this Agreement or any other Credit Document or otherwise exist against the Administrative Agent or the Collateral Agent.

 

9.2                               Delegation of Duties.  The Administrative Agent and the Collateral Agent may execute any of their respective duties under this Agreement and the other Credit Documents by or through agents or attorneys-in-fact and shall be entitled to advice of counsel concerning all matters pertaining to such duties.  Each of the Administrative Agent and the Collateral Agent shall not be responsible for the negligence or misconduct of any agents or attorneys in-fact selected by it with reasonable care.

 

9.3                               Exculpatory Provisions.  Neither any Agent nor any of their respective officers, directors, employees, agents, attorneys-in-fact or affiliates shall be (i) liable for any action lawfully taken or omitted to be taken by it or such Person under or in connection with this Agreement or any other Credit Document (except to the extent that any of the foregoing are found by a final and nonappealable decision

 

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of a court of competent jurisdiction to have resulted from its or such Person’s own gross negligence or willful misconduct) or (ii) responsible in any manner to any of the Lenders for any recitals, statements, representations or warranties made by the Borrower or any officer thereof contained in this Agreement or any other Credit Document or in any certificate, report, statement or other document referred to or provided for in, or received by any Agent under or in connection with, this Agreement or any other Credit Document or for the value, validity, effectiveness, genuineness, enforceability or sufficiency of this Agreement or any other Credit Document or for any failure of the Borrower a party thereto to perform its obligations hereunder or thereunder.  The Agents shall not be under any obligation to any Lender to ascertain or to inquire as to the observance or performance of any of the agreements contained in, or conditions of, this Agreement or any other Credit Document, or to inspect the properties, books or records of the Borrower or any other obligor under the Credit Documents.

 

9.4                               Reliance by Administrative Agent and Collateral Agent.  The Administrative Agent and the Collateral Agent shall each be entitled to rely, and shall be fully protected in relying, upon any instrument, writing, resolution, notice, consent, certificate, affidavit, letter, telecopy, telex or teletype message, statement, order or other document or conversation believed by it to be genuine and correct and to have been signed, sent or made by the proper Person or Persons and upon advice and statements of legal counsel (including counsel to the Borrower), independent accountants and other experts selected by the Administrative Agent or the Collateral Agent, as the case may be.  The Administrative Agent may deem and treat the payee of any Note as the owner thereof for all purposes unless a written notice of assignment, negotiation or transfer thereof shall have been filed with the Administrative Agent in accordance with Section 10.6.  The Administrative Agent and the Collateral Agent shall each be fully justified in failing or refusing to take any action under this Agreement or any other Credit Document unless it shall first receive such advice or concurrence of the Requisite Lenders (or, if so specified by this Agreement, all Lenders) as it deems appropriate or it shall first be indemnified to its satisfaction by the Lenders against any and all liability and expense that may be incurred by it by reason of taking or continuing to take any such action.  Each of the Administrative Agent and the Collateral Agent shall in all cases be fully protected in acting, or in refraining from acting, under this Agreement and the other Credit Documents in accordance with a request of the Requisite Lenders (or, if so specified by this Agreement, all Lenders), and such request and any action taken or failure to act pursuant thereto shall be binding upon all the Lenders and all future holders of the Term Loans.

 

9.5                               Notice of Default.  Neither the Administrative Agent nor the Collateral Agent shall be deemed to have knowledge or notice of the occurrence of any Default or Event of Default unless the Administrative Agent has received written notice from a Lender or the Borrower referring to this Agreement, describing such Default or Event of Default and stating that such notice is a “notice of default.”  In the event that the Administrative Agent receives such a notice, the Administrative Agent shall give notice thereof to the Lenders and the Collateral Agent.  The Administrative Agent and the Collateral Agent shall each take such action with respect to such Default or Event of Default as shall be reasonably directed by the Requisite Lenders (or, if so specified by this Agreement, all Lenders); provided that unless and until the Administrative Agent or the Collateral Agent, as the case may be, shall have received such directions, the Administrative Agent and the Collateral Agent each may (but shall not be obligated to) take such action, or refrain from taking such action, with respect to such Default or Event of Default as it shall deem advisable in the best interests of the Lenders.

 

9.6                               Non-Reliance on Agents and Other Lenders.  Each Lender expressly acknowledges that neither the Agents nor any of their respective officers, directors, employees, agents, attorneys-in-fact or affiliates have made any representations or warranties to it and that no act by any Agent hereafter taken, including any review of the affairs of the Borrower, shall be deemed to constitute any representation or warranty by any Agent to any Lender.  Each Lender represents to the Agents that it has, independently and without reliance upon any Agent or any other Lender, and based on such documents

 

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and information as it has deemed appropriate, made its own appraisal of and investigation into the business, operations, property, financial and other condition and creditworthiness of the Borrower and made its own decision to extend credit hereunder and enter into this Agreement.  Each Lender also represents that it will, independently and without reliance upon any Agent or any other Lender, and based on such documents and information as it shall deem appropriate at the time, continue to make its own credit analysis, appraisals and decisions in taking or not taking action under this Agreement and the other Credit Documents, and to make such investigation as it deems necessary to inform itself as to the business, operations, property, financial and other condition and creditworthiness of the Borrower.  Except for notices, reports and other documents expressly required to be furnished to the Lenders by the Administrative Agent and the Collateral Agent hereunder or under any other Credit Document, the Administrative Agent and the Collateral Agent, as the case may be, shall not have any duty or responsibility to provide any Lender with any credit or other information concerning the business, operations, property, condition (financial or otherwise), prospects or creditworthiness of the Borrower that may come into the possession of the Administrative Agent, the Collateral Agent or any of their respective officers, directors, employees, agents, attorneys-in-fact or affiliates.

 

9.7                               Indemnification.  The Lenders agree to indemnify each Agent, its officers, directors, employees, agents, attorneys-in-fact, and affiliates (collectively, the “Agent Indemnified Parties”) in their capacity as such (to the extent not timely reimbursed by the Borrower and without limiting the obligation of the Borrower to do so), ratably according to each Lender’s respective ratio (expressed as a percentage) of the sum of such Lender’s unpaid principal amount of such Lender’s Term Loans at such time to the sum of all Lenders’ unpaid principal amount of the Loans on the date on which indemnification is sought under this Section (or, if indemnification is sought after the date upon which the Commitments shall have terminated and the Term Loans shall have been paid in full, ratably in accordance with each Lender’s respective ratio (expressed as a percentage) of the sum of such Lender’s unpaid principal amount of such Lender’s Term Loans immediately prior to such repayment, to the sum of all Lenders’ unpaid principal amount of the Term Loans at such time), from and against any and all liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses or disbursements of any kind whatsoever that may at any time (whether before or after the payment of the Loans) be imposed on, incurred by or asserted against such Agent Indemnified Party in any way relating to or arising out of, the Commitments, this Agreement, any of the other Credit Documents or any documents contemplated by or referred to herein or therein or the transactions contemplated hereby or thereby or any action taken or omitted by such Agent Indemnified Party under or in connection with any of the foregoing; provided that no Lender shall be liable for the payment of any portion of such liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses or disbursements that are found by a final and nonappealable decision of a court of competent jurisdiction to have resulted from such Agent Indemnified Party’s gross negligence or willful misconduct.  The agreements in this Section shall survive the payment of the Term Loans and all other amounts payable hereunder.

 

9.8                               Agent in Its Individual Capacity.  Each Agent and its affiliates may make loans to, accept deposits from and generally engage in any kind of business with the Borrower as though such Agent were not an Agent.

 

9.9                               Successor Administrative Agent or Collateral Agent.  The Administrative Agent or Collateral Agent may resign as Administrative Agent or Collateral Agent, as the case may be, upon 30 days’ notice to the Lenders and the Borrower.  If the Administrative Agent or the Collateral Agent shall resign as Administrative Agent or Collateral Agent, as the case may be, under this Agreement and the other Credit Documents, then the Requisite Lenders shall appoint from among the Lenders a successor agent for the Lenders, which successor agent shall (unless an Event of Default shall have occurred and be continuing) be subject to approval by the Borrower (which approval shall not be unreasonably withheld or delayed), whereupon such successor agent shall succeed to the rights, powers and duties of the

 

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Administrative Agent or Collateral Agent, as the case may be, and the term “Administrative Agent” or “Collateral Agent”, as the case may be, means such successor agent effective upon such appointment and approval, and the former Administrative Agent’s or Collateral Agent’s, as the case may be, rights, powers and duties as Administrative Agent or Collateral Agent, as the case may be, shall be terminated, without any other or further act or deed on the part of such former Administrative Agent or Collateral Agent, as the case may be, or any of the parties to this Agreement or any holders of the Term Loans.  If no successor agent has accepted appointment as Administrative Agent or Collateral Agent by the date that is 30 days following a retiring Administrative Agent’s or Collateral Agent’s, as the case may be, notice of resignation, the retiring Administrative Agent’s or Collateral Agent’s resignation shall nevertheless thereupon become effective, and the Lenders shall assume and perform all of the duties of the Administrative Agent or Collateral Agent, as the case may be, hereunder until such time, if any, as the Requisite Lenders and the Borrower, as applicable, appoint a successor Agent as provided for above.  After any retiring Administrative Agent’s or Collateral Agent’s resignation as Administrative Agent or Collateral Agent, as the case may be, the provisions of this Section 9 shall inure to its benefit as to any actions taken or omitted to be taken by it while it was Administrative Agent or Collateral Agent, as the case may be, under this Agreement and the other Credit Documents.  Notwithstanding the foregoing, the retiring Collateral Agent shall continue to hold the Collateral (at the Lenders’ expense) created by the Credit Documents for the benefit of the Lenders until the successor Collateral Agent has been effectively appointed pursuant to this paragraph.

 

9.10                        Withholding Tax.  To the extent required by any applicable law, the Administrative Agent may withhold from any payment to any Lender an amount equivalent to any applicable withholding tax.  If the Internal Revenue Service or any other authority of the United States or other jurisdiction asserts a claim that the Administrative Agent did not properly withhold tax from amounts paid to or for the account of any Lender for any reason (including, without limitation, because the appropriate form was not delivered or not properly executed, or because such Lender failed to notify the Administrative Agent of a change in circumstance that rendered the exemption from, or reduction of withholding tax ineffective), such Lender shall indemnify and hold harmless the Administrative Agent (to the extent that the Administrative Agent has not already been reimbursed by the Borrower for all amounts paid, directly or indirectly, by the Administrative Agent as Taxes or otherwise, together with all expenses incurred, including legal expenses and any other out-of-pocket expenses, whether or not such tax was correctly or legally imposed or asserted by the relevant Governmental Authority.  A certificate as to the amount of such payment or liability delivered to any Lender by the Administrative Agent shall be conclusive absent manifest error.

 

SECTION 10.      MISCELLANEOUS

 

10.1                        Notices.  Unless otherwise specifically provided herein, any notice or other communication herein required or permitted to be given to a Credit Party or an Agent, shall be sent to such Person’s address as set forth on Appendix B or in the other relevant Credit Document, and in the case of any Lender, the address as indicated on Appendix B or otherwise indicated to Administrative Agent in writing.  Each notice hereunder shall be in writing and may be personally served, emailed or sent by facsimile or United States mail or courier service and shall be deemed to have been given when delivered in person or by courier service and signed for against receipt thereof, upon receipt of telefacsimile or telex, or three Business Days after depositing it in the United States mail with postage prepaid and properly addressed; provided, no notice to any Agent shall be effective until received by such Agent.

 

10.2                        Expenses.  Whether or not the transactions contemplated hereby shall be consummated, the Borrower agrees to pay promptly, and in any event within three (3) Business Days after written demand therefore, (a) all the actual and reasonable costs and expenses of Administrative Agent and the

 

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Lenders in the preparation of the Credit Documents and any consents, amendments, waivers or other modifications thereto; (b) all the costs of furnishing all opinions by counsel for the Borrower and the other Credit Parties; (c) the reasonable fees, expenses and disbursements of counsel to Agents and Lenders in connection with the negotiation, preparation, execution and administration of the Credit Documents and any consents, amendments, waivers or other modifications thereto and any other documents or matters requested by Borrower (including the costs and expenses of Paul, Weiss, Rifkind, Wharton & Garrison, LLP, counsel to the Lenders); (d) all the actual costs and expenses of creating and perfecting Liens in favor of Collateral Agent, for the benefit of Secured Parties pursuant hereto, including filing and recording fees, search fees, and fees, expenses and disbursements of counsel to each Agent and of counsel providing any opinions that any Agent or Requisite Lenders may request in respect of the Collateral or the Liens created pursuant to the Credit Documents; (e) all the actual reasonable costs and fees, expenses and disbursements of one firm of any auditors, accountants or consultants; (f) all the actual costs and expenses (including the reasonable fees, expenses and disbursements of counsel, advisors and agents employed or retained by Collateral Agent and its counsel) in connection with the custody or preservation of any of the Collateral; (g) all other actual and costs and expenses incurred by each Agent in connection with the negotiation, preparation, execution and administration of the Credit Documents and any consents, amendments, waivers or other modifications thereto and the transactions contemplated thereby; and (h) after the occurrence of a Default or an Event of Default, all costs and expenses, including attorneys’ fees of one counsel for each of the Administrative Agent and Lenders and appropriate local counsel and costs of settlement, incurred by any Agent and Lenders in enforcing any Obligations of or in collecting any payments due from any Credit Party hereunder or under the other Credit Documents by reason of such Default or Event of Default (including in connection with the sale of, collection from, or other realization upon any of the Collateral or the enforcement of the Guaranty) or in connection with any refinancing or restructuring of the credit arrangements provided hereunder in the nature of a “work out” or pursuant to any insolvency or bankruptcy cases or proceedings.

 

10.3                        Indemnity.

 

(a)                     In addition to the payment of expenses pursuant to Section 10.2, whether or not the transactions contemplated hereby shall be consummated, each Credit Party agrees to defend (subject to Indemnitees’ selection of counsel), indemnify, pay and hold harmless, each Agent and Lender, their Affiliates and their respective officers, partners, directors, trustees, employees, representatives and agents of each Agent and each Lender (each, an “Indemnitee”), from and against any and all Indemnified Liabilities, IN ALL CASES, WHETHER OR NOT CAUSED BY OR ARISING, IN WHOLE OR IN PART, OUT OF THE COMPARATIVE, CONTRIBUTORY, OR SOLE NEGLIGENCE OF SUCH AGENT; provided, no Credit Party shall have any obligation to any Indemnitee hereunder with respect to any Indemnified Liabilities to the extent such Indemnified Liabilities arise solely from the gross negligence or willful misconduct of that Indemnitee as determined by a court of competent jurisdiction in a final, nonappealable order.  To the extent that the undertakings to defend, indemnify, pay and hold harmless set forth in this Section 10.3 may be unenforceable in whole or in part because they are violative of any law or public policy, the applicable Credit Party shall contribute the maximum portion that it is permitted to pay and satisfy under applicable law to the payment and satisfaction of all Indemnified Liabilities incurred by Indemnitees or any of them.

 

(b)                     To the extent permitted by applicable law, no Credit Party shall assert, and each Credit Party hereby waives, any claim against Lenders, Agents and their respective Affiliates, directors, employees, attorneys or agents, on any theory of liability, for special, indirect, consequential or punitive damages (as opposed to direct or actual damages) (whether or not the claim therefor is based on contract, tort or duty imposed by any applicable legal requirement) arising out of, in connection with, as a result of, or in any way related to, this Agreement or any Credit Document or any agreement or instrument contemplated hereby or thereby or referred to herein or therein, the transactions contemplated

 

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hereby or thereby, any Term Loan or the use of the proceeds thereof or any act or omission or event occurring in connection therewith, and each Credit Party hereby waives, releases and agrees not to sue upon any such claim or any such damages, whether or not accrued and whether or not known or suspected to exist in its favor.

 

10.4                        Set Off.  In addition to any rights now or hereafter granted under applicable law and not by way of limitation of any such rights, upon the occurrence of any Event of Default each Lender and its respective Affiliates is hereby authorized by Borrower at any time or from time to time subject to the consent of Administrative Agent (such consent not to be unreasonably withheld or delayed), without notice to any Credit Party or to any other Person (other than Administrative Agent), any such notice being hereby expressly waived, to set off and to appropriate and to apply any and all deposits and any other indebtedness at any time held or owing by such Lender to or for the credit or the account of Borrower (in whatever currency) against and on account of the obligations and liabilities of Borrower to such Lender hereunder and under the other Credit Documents, including all claims of any nature or description arising out of or connected hereto, or with any other Credit Document, irrespective of whether or not (a) such Lender shall have made any demand hereunder, (b) the principal of or the interest on the Term Loans or any other amounts due hereunder shall have become due and payable pursuant to Section 2 and although such obligations and liabilities, or any of them, may be contingent or unmatured or (c) such obligation or liability is owed to a branch or office of such Lender different from the branch or office holding such deposit or obligation or such Indebtedness.

 

10.5                        Amendments and Waivers.

 

(a)                     Requisite Lenders’ Consent.  Subject to Sections 10.5(b) and 10.5(c), no amendment, modification, termination or waiver of any provision of the Credit Documents, or consent to any departure by any Credit Party therefrom, shall in any event be effective without the written concurrence of (i) in the case of this Agreement, Administrative Agent and the Requisite Lenders or (ii) in the case of any other Credit Document, Administrative Agent and, if party thereto, Collateral Agent, with the consent of the Requisite Lenders.

 

(b)                     Affected Lenders’ Consent.  Without the written consent of each Lender that would be affected thereby, no amendment, modification, termination, or consent shall be effective if the effect thereof would:

 

(i)                                          extend the scheduled final maturity of any Term Loan or Term Loan Note of such Lender;

 

(ii)                                       reduce the rate of interest on any Term Loan of such Lender or any fee payable hereunder;

 

(iii)                                    extend the time for payment of any such interest or fees to such Lender;

 

(iv)                                   reduce the principal amount of any Term Loan of such Lender;

 

(v)                                      amend, modify, terminate or waive any provision of this Section 10.5(b) or Section 10.5(c);

 

(vi)                                   amend the definition of “Requisite Lenders” or “Pro Rata Share”;

 

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(vii)                                release all or substantially all of the Collateral or all or substantially all of the Guarantors from the Guaranty except as expressly provided in the Credit Documents;

 

(viii)                             consent to the assignment or transfer by any Credit Party of any of its rights and obligations under any Credit Document; or

 

(ix)                                   extend the Term Loan Commitment of such Lender.

 

(x)                                      amend, modify, terminate or waive any provision of Section 4.12; or

 

(xi)                                   amend, modify, terminate or waive any provision of this Agreement that has the effect of subordinating the payment of any Obligation to any other indebtedness or subordinating any Collateral.

 

(c)                      Other Consents.  No amendment, modification, termination or waiver of any provision of the Credit Documents, or consent to any departure by any Credit Party therefrom, shall amend, modify, terminate or waive any provision of Section 9 as the same applies to any Agent, or any other provision hereof as the same applies to the rights or obligations of any Agent, in each case without the consent of such Agent.

 

(d)                     Execution of Amendments, etc.  Administrative Agent may, but shall have no obligation to, with the concurrence of any Lender, execute amendments, modifications, waivers or consents on behalf of such Lender.  Any waiver or consent shall be effective only in the specific instance and for the specific purpose for which it was given.  No notice to or demand on any Credit Party in any case shall entitle any Credit Party to any other or further notice or demand in similar or other circumstances.  Any amendment, modification, termination, waiver or consent effected in accordance with this Section 10.5 shall be binding upon each Lender at the time outstanding, each future Lender and, if signed by a Credit Party, on such Credit Party.

 

10.6                        Successors and Assigns; Participations.

 

(a)                     Generally.  This Agreement shall be binding upon the parties hereto and their respective successors and assigns and shall inure to the benefit of the parties hereto and the successors and assigns of Lenders.  No Credit Party’s rights or obligations hereunder nor any interest therein may be assigned or delegated by any Credit Party without the prior written consent of all Lenders (and any attempted assignment or transfer by any Credit Party without such consent 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 and, to the extent expressly contemplated hereby, Affiliates of each of the Agents and Lenders) any legal or equitable right, remedy or claim under or by reason of this Agreement.

 

(b)                     Register.  The Borrower, Administrative Agent and Lenders shall deem and treat the Persons listed as Lenders in the Register as the holders and owners of the corresponding Term Loans listed therein for all purposes hereof, and no assignment or transfer of any such Term Loan shall be effective, in each case, unless and until an Assignment Agreement effecting the assignment or transfer thereof shall have been delivered to and accepted by Administrative Agent and recorded in the Register as provided in Section 10.6(e).  Prior to such recordation, all amounts owed with respect to the applicable Term Loan shall be owed to the Lender listed in the Register as the owner thereof, and any request, authority or consent of any Person who, at the time of making such request or giving such authority or consent, is listed in the Register as a Lender shall be conclusive and binding on any subsequent holder, assignee or transferee of the corresponding Term Loans.  Solely for the purposes of

 

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maintaining the Register and for tax purposes only Administrative Agent shall be deemed to be acting on behalf of the Credit Parties.

 

(c)                      Right to Assign.  Each Lender shall have the right at any time to sell, assign or transfer all or a portion of its rights and obligations under this Agreement, including all or a portion of its Term Loans owing to it, Commitments or other Obligations:

 

(i)      to any Person meeting the criteria of clause (a) of the definition of the term of “Eligible Assignee” upon the giving of notice to Borrower and Administrative Agent; or

 

(ii)   to any Person otherwise constituting an Eligible Assignee; provided, each such assignment pursuant to this Section 10.6(c)(ii) shall be in an aggregate amount of not less than $1,000,000 (or such lesser amount as may be agreed to by Borrower and Administrative Agent or as shall constitute the aggregate amount of the Term Loans of the assigning Lender), provided that the foregoing minimum assignment amounts shall not apply (x) to any assignment of all or any portion of a Term Loan to a Lender, an Affiliate of a Lender or a Related Fund of the assignor or (y) if any Event of Default shall have occurred and is continuing.

 

(d)                     Mechanics.  The assigning Lender and the assignee thereof shall execute and deliver to Administrative Agent an Assignment Agreement, together with (i) such forms, certificates or other evidence, if any, with respect to United States federal income tax withholding matters as the assignee under such Assignment Agreement may be required to deliver to Administrative Agent pursuant to Section 2.13(e), and (ii) the assignment fees specified in the Assignment Agreement.

 

(e)                      Notice of Assignment.  Upon its receipt and acceptance of a duly executed and completed Assignment Agreement, any forms, certificates or other evidence required by this Agreement in connection therewith, Administrative Agent shall record the information contained in such Assignment Agreement in the Register, shall give prompt notice thereof to Borrower and shall maintain a copy of such Assignment Agreement.

 

(f)                       Representations and Warranties of Assignee.  Each Lender, upon execution and delivery hereof or upon executing and delivering an Assignment Agreement, as the case may be, represents and warrants as of the Closing Date or as of the applicable Effective Date (as defined in the applicable Assignment Agreement) that (i) it is an Eligible Assignee; (ii) it has experience and expertise in the making of or investing in commitments or loans such as the applicable Term Loans, as the case may be; and (iii) it will make or invest in its Term Loans for its own account in the ordinary course of its business and without a view to distribution of such Term Loans within the meaning of the Securities Act or the Exchange Act or other federal securities laws (it being understood that, subject to the provisions of this Section 10.6, the disposition of such Term Loans or any interests therein shall at all times remain within its exclusive control).

 

(g)                      Effect of Assignment.  Subject to the terms and conditions of this Section 10.6, as of the “Effective Date” specified in the applicable Assignment Agreement: (i) the assignee thereunder shall have the rights and obligations of a “Lender” hereunder to the extent such rights and obligations hereunder have been assigned to it pursuant to such Assignment Agreement and shall thereafter be a party hereto and a “Lender” for all purposes hereof; (ii) the assigning Lender thereunder shall, to the extent that rights and obligations hereunder have been assigned thereby pursuant to such Assignment Agreement, relinquish its rights (other than any rights which survive the termination hereof under Section 10.9) and be released from its obligations hereunder (and, in the case of an Assignment Agreement covering all or the remaining portion of an assigning Lender’s rights and obligations hereunder, such Lender shall cease to be a party hereto; provided, anything contained in any of the Credit

 

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Documents to the contrary notwithstanding, such assigning Lender shall continue to be entitled to the benefit of all indemnities hereunder as specified herein with respect to matters arising out of the prior involvement of such assigning Lender as a Lender hereunder) and (iii) if any such assignment occurs after the issuance of any Term Loan Note hereunder, the assigning Lender shall, upon the effectiveness of such assignment or as promptly thereafter as practicable, surrender its applicable Term Loan Notes to Administrative Agent for cancellation, and thereupon the Borrower shall issue and deliver new Term Loan Notes, if so requested by the assignee and/or assigning Lender, to such assignee and/or to such assigning Lender, with appropriate insertions, to reflect outstanding Term Loans of the assignee and/or the assigning Lender.

 

(h)                     Participations.  Each Lender shall have the right at any time to sell one or more participations to any Person (other than Holdings, any of its Subsidiaries or any of its Affiliates) in all or any part of its Term Loans or in any other Obligation.  The holder of any such participation (a “Participant”), other than an Affiliate of the Lender granting such participation, shall not be entitled to require such Lender to take or omit to take any action hereunder except with respect to any amendment, modification or waiver that would (i) extend the final scheduled maturity of any Term Loan or Term Loan Note in which such Participant is participating, or reduce the rate or extend the time of payment of interest or fees thereon (except any amendment to the definition of “Default Rate” or in connection with a waiver of applicability of any post default increase in interest rates) or reduce the principal amount thereof, or increase the amount of the Participant’s participation over the amount thereof then in effect (it being understood that a waiver of any Default or Event of Default shall not constitute a change in the terms of such participation, and that an increase in any Term Loan shall be permitted without the consent of any Participant if the Participant’s participation is not increased as a result thereof), (ii) consent to the assignment or transfer by any Credit Party of any of its rights and obligations under this Agreement, or (iii) release all or substantially all of the Collateral under the Collateral Documents or all or substantially all of the Guarantors from the Guaranty (in each case, except as expressly provided in the Credit Documents) supporting the Term Loans hereunder in which such Participant is participating.  The Borrower agree that each Participant shall be entitled, through the participating Lender, to the benefits of Sections 2.12 and 2.13 to the same extent as if it were a Lender and had acquired its interest by assignment pursuant to clause (c) of this Section; provided, (i) a Participant shall not be entitled to receive any greater payment under Section 2.12 or 2.13 than the applicable Lender would have been entitled to receive with respect to the participation sold to such Participant, unless the sale of the participation to such Participant is made with Borrower’s prior written consent or such entitlement to receive a greater payment results from a Change in Law that occurs after the Participant acquired the applicable participation, and (ii) a Participant shall not be entitled to the benefits of Section 2.13 unless Borrower is notified of the participation sold to such Participant and such Participant agrees, for the benefit of the Borrower, to comply with Section 2.13 as though it were a Lender.  To the extent permitted by law, each Participant also shall be entitled to the benefits of Section 10.4 as though it were a Lender, provided such Participant agrees to be subject to Section 2.11 as though it were a Lender.  Each Lender that sells a participation shall, acting solely for this purpose as an agent of the Borrower, maintain a register in the United States 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 Term Loans or other obligations under the Credit Documents (the “Participant Register”); provided, that no Lender shall have any obligation to disclose all or any portion of the Participant Register to any Person (including the identity of any participant or any information relating to a participant’s interest in any commitments, loans, letters of credit or other obligations under any Credit Document) 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.

 

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(i)                         Certain Other Assignments.  In addition to any other assignment permitted pursuant to this Section 10.6, any Lender may assign, pledge and/or grant a security interest in, all or any portion of its Term Loans, the other Obligations owed by or to such Lender, and its Term Loan Notes, if any, to secure obligations of such Lender including any Federal Reserve Bank as collateral security pursuant to Regulation A of the Board of Governors of the Federal Reserve System and any operating circular issued by such Federal Reserve Bank; provided, no Lender, as between the Borrower and such Lender, shall be relieved of any of its obligations hereunder as a result of any such assignment and pledge, and provided further, in no event shall the applicable Federal Reserve Bank, pledgee or trustee be considered to be a “Lender” or be entitled to require the assigning Lender to take or omit to take any action hereunder.

 

10.7                        Independence of Covenants.  All covenants hereunder shall be given independent effect so that if a particular action or condition is not permitted by any of such covenants, the fact that it would be permitted by an exception to, or would otherwise be within the limitations of, another covenant shall not avoid the occurrence of a Default or an Event of Default if such action is taken or condition exists.

 

10.8                        Survival of Representations, Warranties and Agreements.  All representations, warranties and agreements made herein shall survive the execution and delivery hereof and the making of any Credit Extension.  Notwithstanding anything herein or implied by law to the contrary, the agreements of each Credit Party set forth in Sections 2.12, 2.13, 10.2, and 10.3 and the agreements of Lenders set forth in Section 2.11 shall survive the payment of the Term Loans and the termination hereof.

 

10.9                        No Waiver; Remedies Cumulative.  No failure or delay on the part of any Agent or any Lender in the exercise of any power, right or privilege hereunder or under any other Credit Document shall impair such power, right or privilege or be construed to be a waiver of any default or acquiescence therein, nor shall any single or partial exercise of any such power, right or privilege preclude other or further exercise thereof or of any other power, right or privilege.  The rights, powers and remedies given to each Agent and each Lender hereby are cumulative and shall be in addition to and independent of all rights, powers and remedies existing by virtue of any statute or rule of law or in any of the other Credit Documents.  Any forbearance or failure to exercise, and any delay in exercising, any right, power or remedy hereunder shall not impair any such right, power or remedy or be construed to be a waiver thereof, nor shall it preclude the further exercise of any such right, power or remedy.

 

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

 

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

 

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10.12                 Obligations Several; Independent Nature of Lenders’ Rights.  The obligations of Lenders hereunder are several and no Lender shall be responsible for the obligations or Term Loan Commitment of any other Lender hereunder.  Nothing contained herein or in any other Credit Document, and no action taken by Lenders pursuant hereto or thereto, shall be deemed to constitute Lenders as a partnership, an association, a joint venture or any other kind of entity.  The amounts payable at any time hereunder to each Lender shall be a separate and independent debt, and each Lender shall be entitled to protect and enforce its rights arising out hereof and it shall not be necessary for any other Lender to be joined as an additional party in any proceeding for such purpose.

 

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

 

10.14                 APPLICABLE LAW.  THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER SHALL BE GOVERNED BY, AND SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.

 

10.15                 CONSENT TO JURISDICTION.

 

(a)                     ALL JUDICIAL PROCEEDINGS BROUGHT AGAINST ANY CREDIT PARTY ARISING OUT OF OR RELATING HERETO OR ANY OTHER CREDIT DOCUMENT, OR ANY OF THE OBLIGATIONS, MAY BE BROUGHT IN ANY STATE OR FEDERAL COURT OF COMPETENT JURISDICTION IN THE STATE, COUNTY AND CITY OF NEW YORK.  BY EXECUTING AND DELIVERING THIS AGREEMENT, EACH CREDIT PARTY, FOR ITSELF AND IN CONNECTION WITH ITS PROPERTIES, IRREVOCABLY (i) ACCEPTS GENERALLY AND UNCONDITIONALLY THE NONEXCLUSIVE JURISDICTION AND VENUE OF SUCH COURTS; (ii) WAIVES ANY DEFENSE OF FORUM NON CONVENIENS; (iii) AGREES THAT SERVICE OF ALL PROCESS IN ANY SUCH PROCEEDING IN ANY SUCH COURT MAY BE MADE BY REGISTERED OR CERTIFIED MAIL, RETURN RECEIPT REQUESTED, TO THE APPLICABLE CREDIT PARTY AT ITS ADDRESS PROVIDED IN ACCORDANCE WITH SECTION 10.1 ABOVE IS SUFFICIENT TO CONFER PERSONAL JURISDICTION OVER THE APPLICABLE CREDIT PARTY IN ANY SUCH PROCEEDING IN ANY SUCH COURT, AND OTHERWISE CONSTITUTES EFFECTIVE AND BINDING SERVICE IN EVERY RESPECT; AND (iv) AGREES THAT AGENTS AND LENDERS RETAIN THE RIGHT TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY LAW OR TO BRING PROCEEDINGS AGAINST ANY CREDIT PARTY IN THE COURTS OF ANY OTHER JURISDICTION.

 

(b)                     EACH CREDIT PARTY HEREBY AGREES THAT PROCESS MAY BE SERVED ON IT BY CERTIFIED MAIL, RETURN RECEIPT REQUESTED, TO THE ADDRESSES PERTAINING TO IT AS SPECIFIED IN SECTION 10.1 OR ON CT CORPORATION SYSTEM, LOCATED AT 111 EIGHTH AVENUE, NEW YORK, NEW YORK 10011, AND HEREBY APPOINTS C T CORPORATION SYSTEM AS ITS AGENT TO RECEIVE AND FORWARD SUCH SERVICE OF PROCESS.  ANY AND ALL SERVICE OF PROCESS AND ANY OTHER NOTICE IN ANY SUCH ACTION, SUIT OR PROCEEDING SHALL BE EFFECTIVE AGAINST ANY CREDIT PARTY IF GIVEN BY REGISTERED OR CERTIFIED MAIL, RETURN RECEIPT REQUESTED, OR BY ANY OTHER MEANS OR MAIL WHICH REQUIRES A SIGNED RECEIPT, POSTAGE PREPAID, MAILED AS PROVIDED ABOVE.  IN THE EVENT C T CORPORATION SYSTEM SHALL NOT BE ABLE TO ACCEPT SERVICE OF PROCESS AS AFORESAID AND IF ANY CREDIT PARTY SHALL NOT MAINTAIN AN OFFICE IN NEW YORK CITY, SUCH CREDIT PARTY SHALL

 

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PROMPTLY APPOINT AND MAINTAIN AN AGENT QUALIFIED TO ACT AS AN AGENT FOR SERVICE OF PROCESS WITH RESPECT TO THE COURTS SPECIFIED IN THIS SECTION 10.16 ABOVE, AND ACCEPTABLE TO ADMINISTRATIVE AGENT, AS EACH CREDIT PARTY’S AUTHORIZED AGENT TO RECEIVE AND FORWARD ON EACH CREDIT PARTY’S BEHALF SERVICE OF ANY AND ALL PROCESS WHICH MAY BE SERVED IN ANY SUCH ACTION, SUIT OR PROCEEDING.

 

10.16                 WAIVER OF JURY TRIAL.  EACH OF THE PARTIES HERETO HEREBY AGREES TO WAIVE ITS RESPECTIVE RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING HEREUNDER OR UNDER ANY OF THE OTHER CREDIT DOCUMENTS OR ANY DEALINGS BETWEEN THEM RELATING TO THE SUBJECT MATTER OF THIS LOAN TRANSACTION OR THE LENDER/BORROWER RELATIONSHIP THAT IS BEING ESTABLISHED.  THE SCOPE OF THIS WAIVER IS INTENDED TO BE ALL ENCOMPASSING OF ANY AND ALL DISPUTES THAT MAY BE FILED IN ANY COURT AND THAT RELATE TO THE SUBJECT MATTER OF THIS TRANSACTION, INCLUDING CONTRACT CLAIMS, TORT CLAIMS, BREACH OF DUTY CLAIMS AND ALL OTHER COMMON LAW AND STATUTORY CLAIMS.  EACH PARTY HERETO ACKNOWLEDGES THAT THIS WAIVER IS A MATERIAL INDUCEMENT TO ENTER INTO A BUSINESS RELATIONSHIP, THAT EACH HAS ALREADY RELIED ON THIS WAIVER IN ENTERING INTO THIS AGREEMENT, AND THAT EACH WILL CONTINUE TO RELY ON THIS WAIVER IN ITS RELATED FUTURE DEALINGS.  EACH PARTY HERETO FURTHER WARRANTS AND REPRESENTS THAT IT HAS REVIEWED THIS WAIVER WITH ITS LEGAL COUNSEL AND THAT IT KNOWINGLY AND VOLUNTARILY WAIVES ITS JURY TRIAL RIGHTS FOLLOWING CONSULTATION WITH LEGAL COUNSEL.  THIS WAIVER IS IRREVOCABLE, MEANING THAT IT MAY NOT BE MODIFIED EITHER ORALLY OR IN WRITING (OTHER THAN BY A MUTUAL WRITTEN WAIVER SPECIFICALLY REFERRING TO THIS SECTION 10.16 AND EXECUTED BY EACH OF THE PARTIES HERETO), AND THIS WAIVER SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS, RENEWALS, SUPPLEMENTS OR MODIFICATIONS HERETO OR ANY OF THE OTHER CREDIT DOCUMENTS OR TO ANY OTHER DOCUMENTS OR AGREEMENTS RELATING TO THE LOANS MADE HEREUNDER.  IN THE EVENT OF LITIGATION, THIS AGREEMENT MAY BE FILED AS A WRITTEN CONSENT TO A TRIAL BY THE COURT.

 

10.17                 Confidentiality.  Each Lender shall hold all non-public information regarding the Borrower and its Subsidiaries and their businesses clearly identified as such by Borrower and obtained by such Lender pursuant to the requirements hereof in accordance with such Lender’s customary procedures for handling confidential information of such nature, it being understood and agreed by the Borrower that, in any event, a Lender may make (i) disclosures of such information to Affiliates of such Lender and to their directors, officers, employees, agents and advisors (and to other persons authorized by a Lender or Agent to organize, present or disseminate such information in connection with disclosures otherwise made in accordance with this Section 10.17), (ii) disclosures of such information reasonably required by any bona fide or potential assignee, transferee or participant in connection with the contemplated assignment, transfer or participation by such Lender of any Term Loans, commitments or any participations therein, (iii) disclosures to any Lender’s financing sources, provided that prior to any disclosure, such financing source is informed of the confidential nature of the information, (iv) disclosure of information which (A) becomes publicly available other than as a result of a breach of this Section 10.17 or (B) becomes available to Administrative Agent or any Lender on a non-confidential basis from a source other than the Borrower, and (v) disclosures required or requested by any governmental agency or representative thereof or by the NAIC or pursuant to legal or judicial process; provided, unless specifically prohibited by applicable law or court order, each Lender shall make

 

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reasonable efforts to notify Borrower of any request by any governmental agency or representative thereof (other than any such request in connection with any examination of the financial condition or other routine examination of such Lender by such governmental agency) for disclosure of any such non-public information prior to disclosure of such information.

 

10.18                 Usury Savings Clause.  Notwithstanding any other provision herein, the aggregate interest rate charged or agreed to be paid with respect to any of the Obligations, including all charges or fees in connection therewith deemed in the nature of interest under applicable law shall not exceed the Highest Lawful Rate.  If the rate of interest (determined without regard to the preceding sentence) under this Agreement at any time exceeds the Highest Lawful Rate, the outstanding amount of the Term Loans made hereunder shall bear interest at the Highest Lawful Rate until the total amount of interest due hereunder equals the amount of interest which would have been due hereunder if the stated rates of interest set forth in this Agreement had at all times been in effect.  In addition, if when the Term Loans made hereunder are repaid in full the total interest due hereunder (taking into account the increase provided for above) is less than the total amount of interest which would have been due hereunder if the stated rates of interest set forth in this Agreement had at all times been in effect, then to the extent permitted by law, the Borrower shall pay to Administrative Agent an amount equal to the difference between the amount of interest paid and the amount of interest which would have been paid if the Highest Lawful Rate had at all times been in effect.  Notwithstanding the foregoing, it is the intention of Lenders and the Borrower to conform strictly to any applicable usury laws.  Accordingly, if any Lender contracts for, charges, or receives any consideration which constitutes interest in excess of the Highest Lawful Rate, then any such excess shall be cancelled automatically and, if previously paid, shall at such Lender’s option be applied to the outstanding amount of the Term Loans made hereunder or be refunded to the Borrower.  In determining whether the interest contracted for, charged, or received by Administrative Agent or a Lender exceeds the Highest Lawful 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.

 

10.19                 Counterparts.  This Agreement may be executed in any number of counterparts, each of which when so executed and delivered shall be deemed an original, but all such counterparts together shall constitute but one and the same instrument.

 

10.20                 Effectiveness.  This Agreement shall become effective upon the execution of a counterpart hereof by each of the parties hereto and receipt by Borrower and Administrative Agent of written or telephonic notification of such execution and authorization of delivery thereof.  Delivery of an executed counterpart to this Agreement by telecopy transmission (or other electronic transmission pursuant to procedures approved by the Administrative Agent) shall be as effective as delivery of a manually signed original.

 

10.21                 Patriot Act.  Each Lender and Administrative Agent (for itself and not on behalf of any Lender) hereby notifies the Borrower that pursuant to the requirements of the Patriot Act, it is required to obtain, verify and record information that identifies the Borrower, which information includes the name and address of the Borrower and other information that will allow such Lender or Administrative Agent, as applicable, to identify the Borrower in accordance with the Patriot Act.

 

10.22                 Entire Agreement.  This Agreement and the other Credit Documents 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.

 

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[Remainder of page intentionally left blank]

 

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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed and delivered by their respective officers thereunto duly authorized as of the date first written above.

 

 

	
 
    	
MEDICAL DEVELOPERS LLC
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
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[OTHER CREDIT PARTIES]
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
 
    	
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Title:
    

 

 

	
 
    	
CORTLAND CAPITAL MARKET   SERVICES LLC, as Administrative Agent and Collateral Agent
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
 
    	
Name:
    
	
 
    	
 
    	
Title:

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