Document:

EX-10.3

 Exhibit 10.3 
  

 
 R1 RCM Inc. 

November 7, 2022 
 John Sparby 

[*****] 
 Re: Employment Terms 

Dear John, 
 On behalf of R1 RCM Inc. (“R1”), I am
delighted to confirm that, effective January 1, 2023, you will be appointed as President, reporting to R1’s Chief Executive Officer. The terms and conditions of your employment with R1 are set forth in further detail below and Exhibit
A (collectively, with all other Exhibits hereto, this “Agreement”). Effective January 1, 2023, this Agreement will supersede any and all prior employment agreements or offer letters with R1 and/or its parent, subsidiaries, or
predecessors. 
 Salary and Annual Bonus 
 Your
starting salary (“Base Salary”) will be $750,000 per year, paid semi-monthly. You will continue to be eligible to participate in the R1 annual cash incentive bonus plan (“Annual Bonus Plan”) with an annual bonus
target equal to 100% of your Base Salary. The bonus is discretionary and will be earned each calendar year based upon achievement of corporate and individual performance objectives established for that calendar year. 

Equity Grants 
 You will continue to be eligible to
participate in the long-term incentive (“LTI”) program along with other R1 executives. Awards under the LTI program are at the discretion of the Human Capital Committee. Beginning in 2023, based on the current program, the target value of
annual equity awards will be 200% of your Base Salary. 
 Health & Welfare Benefits 

You will continue to be eligible to participate in R1’s benefit programs on the same terms and conditions as similarly situated executives, including
R1’s Executive Health program. 
 Additional Employment Terms 

Attached as Exhibit A are additional terms of your employment. 

 John, we truly believe that we are building the best team in the industry and are very pleased that you will
be joining us at R1. To accept these terms, please sign below and return an executed copy to me. 
 Sincerely, 

 

	
	 /s/ Kate Sanderson

	Kate Sanderson
	Executive Vice President, Chief HR Officer

  

	
	Agreed and Accepted:
	
	 /s/ John Sparby

	John Sparby
	
	Date: November 7, 2022

  
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 Exhibit A 

Employment Terms 
  

	1.	 Your employment with R1 RCM Inc and R1 RCM Holdco Inc. (“R1” or “Company”) is “at
will,” meaning it is terminable at any time by either you or R1, subject to the provisions of this Agreement. 

  

	2.	 Your employment with R1, as well as your role as an officer of R1 or any subsidiary, will terminate:

  

	 	a.	 upon at least thirty days’ prior written notice to R1 of your voluntary termination of employment, with or
without Good Reason (which R1 may, in its sole discretion, make effective earlier than any notice date); 

  

	 	b.	 as specified in a written notice by R1 to you of a termination of employment for Cause or without Cause (other
than for Disability); 

  

	 	c.	 immediately upon your death; or 

 

	 	d.	 upon at least ten days’ prior written notice by R1 to you of your termination of employment due to
Disability. 

  

	3.	 Severance. 

  

	 	a.	 In the event of your termination of employment from R1 by reason of your death, Disability, or by R1 for Cause,
you will be entitled to receive: 

  

	 	i.	 any unpaid Base Salary through the date of termination; 

 

	 	ii.	 except in the case of your termination by R1 for Cause, any annual bonus earned but unpaid with respect to the
fiscal year ending on or preceding the date of termination, payable at the same time as it would have been paid had you not undergone a termination of employment; 

 

	 	iii.	 reimbursement in accordance with applicable Company policy for any unreimbursed business expenses incurred
through the date of termination; 

  

	 	iv.	 any accrued but unused vacation time in accordance with Company policy; and 

 

	 	v.	 all other payments, benefits or fringe benefits to which you are entitled under the terms of any applicable
compensation or equity arrangement or employee benefit plan or program of R1 (collectively, the foregoing payment and benefits described in clauses (i)-(v) will be hereafter referred to as the “Accrued Benefits”). 

  
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	 	b.	 In the event of your termination of employment from R1 by R1 without Cause, or by you for Good Reason, R1 shall
pay or provide you with the following severance benefits in addition to the Accrued Benefits: 

  

	 	i.	 subject to your continued compliance with all of your post-termination obligations to R1, an amount equal to
your monthly Base Salary rate, paid monthly for a period of twelve months following such termination. 

  

	 	ii.	 subject to (A) your timely election of continuation coverage under the Consolidated Omnibus Budget
Reconciliation Act of 1985, as amended (“COBRA”), (B) your continued copayment of premiums at the same level and cost to you as if you were an employee of R1 (excluding, for purposes of calculating cost, an employee’s ability to pay
premiums with pre-tax dollars), and (C) your continued compliance with all of your post-termination obligations to R1, continued participation in R1’s group health plan (to the extent permitted under
applicable law and the terms of such plan) which covers you (and your eligible dependents) for a period of twelve months following such termination at R1’s expense; provided that you are eligible and remain eligible for COBRA coverage;
and provided, further, that in the event that you obtain other employment that offers group health benefits, such continuation of coverage by R1 will immediately cease. Notwithstanding the foregoing, R1 will not be obligated to provide the foregoing
continuation coverage if it would result in the imposition of excise taxes on R1 for failure to comply with the nondiscrimination requirements of the Patient Protection and Affordable Care Act of 2010, as amended, and the Health Care and Education
Reconciliation Act of 2010, as amended (to the extent applicable); and 

  

	 	iii.	 A lump sum equal to your target Annual Bonus Plan target. 

 

	 	c.	 Payment of all amounts described in part (b) above, excluding the Accrued Benefits (the “Severance
Payments”) will only be payable if you deliver to R1 and do not revoke a general release of claims in favor of R1 and its affiliates in a form reasonably satisfactory to R1. Such release must be executed and delivered (and no longer subject to
revocation, if applicable) within sixty days following termination. To the extent that payment of any amount of the Severance Payments constitutes “nonqualified deferred compensation” for purposes of “Code Section 409A” (as
defined below), any such payment scheduled to occur during the first sixty days following the termination of employment will not be paid until the sixtieth day following such termination of employment and will include payment of any amount that was
otherwise scheduled to be paid prior thereto. 

  

	 	d.	 In the event that a Change of Control occurs while you have been in the continuous employment of R1, vesting of
equity awards (or, if applicable, any securities granted or issued to you in respect of such equity award in connection with a Change of Control) shall be governed by the relevant plan document for each such award. 

  
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	4.	 For purposes of this Agreement: 

 

	 	a.	 “Cause” means: (i) your conviction for, or plea of guilty or nolo contendere to, a
felony; (ii) your engaging in conduct that constitutes gross neglect or willful misconduct and that, in either case, results in material economic or reputational harm to R1; (iii) your willful breach of any provision of this Agreement or
any applicable non-disclosure, non-competition, non-solicitation or other similar restrictive covenant obligation owed to R1; or
(iv) your repeated refusal, or failure to undertake good faith efforts, to perform your material employment duties and responsibilities for R1, so long as R1 provides written notice of the perceived violations under this subsection
(iv) and you fail to cure within thirty (30) days of such notice. 

  

	 	b.	 “Change of Control” means 

 

	 	i.	 the consummation of any consolidation or merger of R1 where the stockholders of R1, immediately prior to the
consolidation or merger, would not, immediately after the consolidation or merger, beneficially own (as such term is defined in Rule 13d-3 under the Act), directly or indirectly, shares representing in the
aggregate more than fifty percent (50%) of the voting shares of R1 issuing cash or securities in the consolidation or merger (or of its ultimate parent corporation, if any); 

 

	 	ii.	 any sale, lease, exchange or other transfer (in one transaction or a series of transactions contemplated or
arranged by any party as a single plan) of all or substantially all of the assets of R1 to a Third-Party Purchaser; 

  

	 	iii.	 any sale of a majority of the voting shares of R1 to a Third-Party Purchaser; 

 

	 	iv.	 the consummation of a Take Private Change of Control; or 

 

	 	v.	 any liquidation or dissolution of R1. 

Notwithstanding the foregoing, other than with respect to a Take Private Change of Control, a “Change of Control” shall not be
deemed to have occurred if the event constituting such “Change of Control” is not (x) a change in the ownership of the corporation, (y) a change in effective control of the corporation, or (z) a change in the ownership of a
substantial portion of the assets of the corporation, as those terms are used and defined in Section 409A(a)(2)(A)(v) of the Code, and the regulations thereunder, and where the word “corporation” used above and in such provisions is
taken to refer to R1. 
  

	 	c.	 “Disability” means you have been unable, with or without reasonable accommodation and due to
physical or mental incapacity, to substantially perform your duties and responsibilities hereunder for a period of one hundred eighty days out of any consecutive three hundred sixty-five days. 

 

	 	d.	 “Good Reason” shall mean (i) a material diminution of your position, responsibilities, or
duties; (ii) a reduction of your Base Salary or Annual Bonus Plan target; or (iii) a reporting relationship to any position below the CEO of R1. In order to terminate your employment for Good Reason, you must submit written notice to R1,
describing the specific facts constituting Good Reason, within 60 days after the occurrence of the actions giving rise to Good Reason. Further, a Good Reason termination will only be effective if the conditions outlined above are not cured by R1
within thirty (30) days following receipt of the detailed written notice by you to R1. 

  
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	 	e.	 “Person” means any individual, entity or group, within the meaning of Section 13(d) or
14(d) of the Exchange Act, but excluding (i) R1 and any of its subsidiaries, (ii) any employee stock ownership or other employee benefit plan maintained by R1, and (iii) an underwriter or underwriting syndicate that has acquired
R1’s securities solely in connection with a public offering thereof. 

  

	 	f.	 “Take Private Change of Control” means the consummation of any transaction or series of
transactions following which no shares of R1 (or of its ultimate parent corporation) are listed on the New York Stock Exchange or the NASDAQ, on any other United States stock exchange, or are otherwise listed on a public trading market (including
the OTC Markets Group, Inc.). 

  

	 	g.	 “Third Party Purchaser” means any Person or group of Persons, none of whom is, immediately
prior to the subject transaction, TowerBrook, Ascension, a TB/AS Co-Investment Vehicle, New Mountain Capital, or any Affiliate thereof. 

 

	5.	 Restrictive Covenants. You, by virtue of your role with R1, have access to, and are involved in the formulation
of, certain confidential and secret information of R1 regarding its operations and you could materially harm the business of R1 by competing with R1 or soliciting employees or customers of R1. 

 

	 	a.	 Non-Solicitation. During the time in which you perform services
for R1 and for a period of eighteen months after you cease to perform services for R1, regardless of the reason, you shall not, directly or indirectly, either alone or in conjunction with any person, firm, association, company or corporation:

  

	 	i.	 Hire, recruit, solicit or otherwise attempt to employ or retain or enter into any business relationship with,
any person who is or was an employee of R1 within the eighteen month period immediately preceding the cessation of your service with R1; or 

  

	 	ii.	 Solicit the sale of any products or services that are similar to or competitive with products or services
offered by, manufactured by, designed by, or distributed by Company, to any person, company or entity which was or is a customer or potential customer of Company for such products or services. 

 

	 	b.	 Non-Disclosure. You will not, without R1’s prior written
permission, directly or indirectly, utilize for any purpose other than for a legitimate business purpose solely on behalf of R1, or directly or indirectly, disclose to anyone outside of R1, either during or after your employment with R1 ends,
R1’s Confidential Information, as long as such matters remain Confidential Information. This Agreement shall not prohibit you from (i) revealing evidence of criminal wrongdoing to law enforcement, (ii) disclosing or discussing
concerns regarding regulatory or legal compliance with any governmental agency or entity to the extent that such disclosures or discussions are protected under any whistleblower protection provisions of Federal or state laws or regulations or
(iii) divulging R1’s Confidential Information by order of court or agency of competent jurisdiction. However, you shall promptly inform R1 of any such situations and shall take such reasonable steps to prevent disclosure of R1’s
Confidential Information until R1 has been informed of such requested disclosure and R1 has had an opportunity to respond to the court or agency. 

  
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	 	c.	 Return of Company Property. You agree that, in the event that your service to R1 is terminated for any
reason, you shall immediately return all of R1’s property, including without limitation, (i) tools, pagers, computers, printers, key cards, documents or other tangible property of R1, and (ii) R1’s Confidential Information in any
media, including paper or electronic form, and Participant shall not retain in your possession any copies of such information. 

  

	 	d.	 Ownership of Software and Inventions. All discoveries, designs, improvements, ideas, inventions,
software, whether patentable or copyrightable or not, shall be works-made-for-hire and Company shall be deemed the sole owner throughout the universe of any and all
rights of whatsoever nature therein, with the rights to use the same in perpetuity in any manner R1 determines in its sole discretion without any further payment to you whatsoever. If, for any reason, any of such results and proceeds which relate to
the business shall not legally be a work-for-hire and/or there are any rights which do not accrue to R1 under the preceding sentence, then you hereby irrevocably assigns
and agrees to quitclaim any and all of your right, title and interest thereto including, without limitation, any and all copyrights, patents, trade secrets, trademarks and/or other rights of whatsoever nature therein, whether or not now or hereafter
known, existing, contemplated, recognized or developed to R1, and R1 shall have the right to use the same in perpetuity throughout the universe in any manner R1 determines without any further payment to you whatsoever. You shall, from time to time,
as may be reasonably requested by R1, at R1’s expense, do any and all things which R1 may deem useful or desirable to establish or document R1’s exclusive ownership of any and all rights in any such results and proceeds, including, without
limitation, the execution of appropriate copyright and/or patent applications or assignments. To the extent you have any rights in the results and proceeds of your services that cannot be assigned in the manner described above, you unconditionally
and irrevocably waives the enforcement of such rights. Notwithstanding anything to the contrary set forth herein, works developed by you (i) which are developed independently from the work developed for R1 regardless of whether such work was
developed before or after you performed services for R1; or (ii) applications independently developed which are unrelated to the business and which you develop during non-business hours using non-business property shall not be deemed work for hire and shall not be the exclusive property of R1. 

  

	 	e.	 Non-Competition. 

 

	 	i.	 During the time of your employment for R1 and for a period of twelve months after the termination of
your employment for R1, regardless of the reason, you shall not, directly or indirectly, either alone or in conjunction with any person, firm, association, company or corporation, within the Restricted Area, own, manage, operate, or participate in
the ownership, management, operation, or control of, or be employed by or provide services to, any entity which is in competition with R1. 

  
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	 	ii.	 Notwithstanding anything to the contrary, nothing in this Paragraph (d) prohibits you from being a passive
owner of not more than one percent of the outstanding stock of any class of a corporation which is publicly traded, so long as you have no active participation in the business of such corporation. 

 

	 	f.	 Acknowledgments. You acknowledge and agree that the restrictions contained in this Agreement with
respect to time, geographical area and scope of activity are reasonable and do not impose a greater restraint than is necessary to protect the goodwill and other legitimate business interests of R1 and that you have the opportunity to review the
provisions of this Agreement with your legal counsel. In particular, you agree and acknowledge (i) that R1 is currently engaging in business and actively marketing its services and products throughout the United States, (ii) that your
duties and responsibilities for R1 are co-extensive with the entire scope of R1’s business, (iii) that R1 has spent significant time and effort developing and protecting the confidentiality of its
methods of doing business, technology, customer lists, long term customer relationships and trade secrets, and (iv) that such methods, technology, customer lists, customer relationships and trade secrets have significant value.

  

	 	g.	 Enforcement. You agree that the restrictions contained in this Agreement are necessary for the
protection of the business, the Confidential Information, customer relationships and goodwill of R1 and are considered by you to be reasonable for that purpose and that the scope of restricted activities, the geographic scope and the duration of the
restrictions set forth in this Agreement are considered by you to be reasonable. You further agree that any breach of any of the restrictive covenants in this Agreement would cause R1 substantial, continuing and irrevocable harm for which money
damages would be inadequate and therefore, in the event of any such breach or any threatened breach, in addition to such other remedies as may be available, R1 shall be entitled to specific performance and injunctive relief. This Agreement shall not
in any way limit the remedies in law or equity otherwise available to R1 or its Affiliates. You further agree that to the extent any provision or portion of the restrictive covenants of this Agreement shall be held, found or deemed to be
unreasonable, unlawful or unenforceable by a court of competent jurisdiction, then any such provision or portion thereof shall be deemed to be modified to the extent necessary in order that any such provision or portion thereof shall be legally
enforceable to the fullest extent permitted by applicable law. 

  

	 	h.	 Severability; Modification. It is expressly agreed by you that: 

 

	 	i.	 Modification. If, at the time of enforcement of this Agreement, a court holds that the duration,
geographical area or scope of activity restrictions stated herein are unreasonable under circumstances then existing or impose a greater restraint than is necessary to protect the goodwill and other business interests of R1, you agree that the
maximum duration, scope or area reasonable under such circumstances will be substituted for the stated duration, scope or area and that the court will be allowed to revise the restrictions contained herein to cover the maximum duration, scope and
area permitted by law, in all cases giving effect to the intent of the parties that the restrictions contained herein be given effect to the broadest extent possible; and 

  
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	 	ii.	 Severability. Whenever possible, each provision of this Agreement will be interpreted in such manner as
to be effective and valid under applicable law, but if any provision of this Agreement is held to be invalid, illegal or unenforceable in any respect under applicable law, such invalidity, illegality or unenforceability will not affect any other
provision, but this Agreement will be reformed, construed and enforced as if such invalid, illegal or unenforceable provision had never been contained herein. 

 

	 	i.	 Non-Disparagement. You and R1 understand and agree not to
disparage the other party, or its officers, directors, administrators, representatives, employees, contractors, consultants or customers, as applicable, and will not engage in any communications or other conduct which might interfere with the
relationship between the other party or its current, former, or prospective employees, contractors, consultants, customers, suppliers, regulatory entities, and/or any other persons or entities, other than to enforce the terms of this Agreement.

  

	 	j.	 Definitions. 

  

	 	i.	 Confidential Information. “Confidential Information” as used in this Section 5 shall
include R1’s trade secrets as defined under Illinois law, as well as any other information or material which is not generally known to the public, and which (A) is generated, collected by or utilized in the operations of R1’s business
and relates to the actual or anticipated business, research or development of R1; or (B) is suggested by or results from any task assigned to you by R1 or work performed by you for or on behalf of R1. Confidential Information shall not be
considered generally known to the public if you or others improperly reveal such information to the public without R1’s express written consent and/or in violation of an obligation of confidentiality to R1. Examples of Confidential Information
include, but are not limited to, all customer, client, supplier and vendor lists, budget information, contents of any database, contracts, product designs, technical know-how, engineering data, pricing and
cost information, research and development work, software, business plans, proprietary data, projections, market research, perceptual studies, strategic plans, marketing information, financial information (including financial statements), sales
information, training manuals, employee lists and compensation of employees, and all other competitively sensitive information with respect to R1, whether or not it is in tangible form, and including without limitation any of the foregoing contained
or described on paper or in computer software or other storage devices, as the same may exist from time to time. 

  

	 	ii.	 Restricted Area. For purposes of this Agreement, the term “Restricted Area” shall mean the
United States of America. 

  
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	6.	 Section 409A 

 

	 	a.	 It is intended that all payments and benefits under this Agreement, the Annual Bonus Plan, the LTI, the 2010
Stock Incentive Plan, and any other plan under which you receive compensation shall comply with, or be exempt from, Internal Revenue Code Section 409A and the regulations and guidance promulgated thereunder (collectively “Code
Section 409A”) and, to the maximum extent permitted, this Agreement and such other agreements and plans will be interpreted in accordance with such intention. To the extent that any provision hereof is modified in order to comply with Code
Section 409A, such modification will be made in good faith and will, to the maximum extent reasonably possible, maintain the original intent and economic benefit to you and R1 of the applicable provision without violating the provisions of Code
Section 409A. R1 represents and covenants that payments and benefits to be paid to you under this Agreement, the Annual Bonus Plan, the LTI, the 2010 Stock Incentive Plan, and any other plan under which you will receive compensation are not and
will not be subject to any additional tax or interest under Code Section 409A. R1 and you agree to take any action, or refrain from taking any action, reasonably requested by you or R1, as applicable, to comply with the terms of any correction
procedure promulgated under Code Section 409A. 

  

	 	b.	 A termination of employment will not be deemed to have occurred for purposes of any provision of this Agreement
providing for the payment of any amount or benefit that is “nonqualified deferred compensation” under Code Section 409A upon or following a termination of employment unless such termination is also a “separation from
service” within the meaning of Code Section 409A and, for purposes of any such provision of this Agreement, references to a “termination,” “termination of employment” or like terms will mean a “separation from
service.” If on the date of your termination you are a “specified employee” for purposes of Code Section 409A, any payment or benefit that is “nonqualified deferred compensation” that is payable on account of a
“separation from service” (as such terms are defined for purposes of Code Section 409A), such payment or benefit will be made or provided at the date that is the earliest of (a) the expiration of the six (6)-month period measured
from the date of your “separation from service,” (b) the date of your death, or (c) such other date that such payment or benefit may be provided without incurring any additional tax or interest under Code Section 409A. Upon the
expiration of the foregoing delay period, any payments and benefits delayed pursuant to the previous sentence will be paid or made available to you in a lump sum and all remaining benefits payments and benefits due will be paid or provided in
accordance with the normal payment dates specified for them herein. 

  

	 	c.	 With regard to any reimbursement to you of any costs and expenses or the provision of any in-kind benefits, except as otherwise permitted by Code Section 409A, (a) the right to reimbursement or in-kind benefits will not be subject to liquidation or
exchange for another benefit, (b) the amount of expenses eligible for reimbursement, or in-kind benefits, provided during any taxable year will not affect the expenses eligible for reimbursement, or in-kind to be provided, in any other taxable year, and (c) such payments will be made on or before the last day of your taxable year following the taxable year in which the expense occurred (it being understood
that notwithstanding this (c), any reimbursements to you will be made promptly after you have substantially complied with R1’s policy regarding the reimbursement of expenses). 

  
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	 	d.	 Your right to receive any installment payments under this Agreement, the Annual Bonus Plan, the LTI, the 2010
Stock Incentive Plan, or any other plan under which you receive compensation shall be treated as a right to receive a series of separate payments, and each such payment shall be a separately identified and determinable amount, to the maximum extent
permitted under Code Section 409A. Whenever a payment under this Agreement specifies a payment within a period of days, the actual date of payment within such specified period will be within the sole discretion of R1. 

 

	 	e.	 In no event will any payment that constitutes “nonqualified deferred compensation” for purposes of
Code Section 409A be subject to offset by any other amount unless otherwise permitted by Code Section 409A. 

  

	7.	 Governing Law. This Agreement shall be construed, interpreted and enforced in accordance with the
internal laws of the State of Delaware without regard to any applicable conflicts of law provisions. 

  

	8.	 Exclusive Jurisdiction/Venue. All disputes that arise from or relate to this Agreement shall be decided
exclusively by binding arbitration in Salt Lake County, Utah under the Commercial Arbitration Rules of the American Arbitration Association. The parties agree that the arbitrator’s award shall be final, and may be filed with and enforced as a
final judgment by any court of competent jurisdiction. Notwithstanding the foregoing, any disputes related to the enforcement of the restrictive covenants contained in this Agreement shall be subject to and determined under Delaware law and
adjudicated in Utah courts. 

  

	9.	 Notices. Any notice hereunder by you shall be given to R1 in writing and such notice shall be deemed
duly given only upon receipt thereof by the General Counsel of R1. Any notice hereunder by R1 shall be given to you in writing and such notice shall be deemed duly given only upon receipt thereof at such address as you may have on file with
R1. 

  

	10.	 Headings. The titles and headings of the various sections of this Agreement have been inserted for
convenience of reference only and shall not be deemed to be a part of this Agreement. 

  

	11.	 Counterparts. This Agreement may be executed in one or more counterparts, each of which shall be deemed
to be an original, but all of which shall constitute one and the same instrument. 

  

	12.	 Severability. The invalidity or unenforceability of any provisions of this Agreement in any jurisdiction
shall not affect the validity, legality or enforceability of the remainder of this Agreement in such jurisdiction or the validity, legality or enforceability of any provision of this Agreement in any other jurisdiction, it being intended that all
rights and obligations of the parties hereunder shall be enforceable to the fullest extent permitted by law. 

  

	13.	 Binding Agreement; Assignment. This Agreement shall inure to the benefit of, be binding upon, and be
enforceable by R1 and its successors and assigns and you. You shall not assign any part of this Agreement without the prior express written consent of R1. 

  
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	14.	 Entire Agreement; Precedence; Amendment. This Agreement together contain the entire agreement between
the parties hereto with respect to the subject matter contained herein and supersedes all prior agreements or prior understandings, whether written or oral, between the parties relating to such subject matter. This Agreement may be modified or
amended by a writing signed by both R1 and you. 

  

							
	JOHN SPARBY	 		 	R1 RCM INC.
			
	 /s/ John Sparby
	 		 	 /s/ Kate Sanderson

		 		 	By:	 	Kate Sanderson
		 		 	Title: EVP and Chief Human Resources Officer
			
	Dated: November 7, 2022	 		 	Dated: November 7, 2022

  
 12secondamendmenttoseconda

EXHIBIT 10.22  SECOND AMENDMENT TO CREDIT AGREEMENT    THIS SECOND AMENDMENT TO SECOND AMENDED AND RESTATED  CREDIT AGREEMENT (this “Amendment”), dated as of August 10, 2022, is by and among  USANA HEALTH SCIENCES, INC., a Utah corporation (the “Borrower”), the Guarantors party hereto,  the Lenders party hereto and BANK OF AMERICA, N.A., as administrative agent (in such capacity, the  “Administrative Agent”).    W I T N E S S E T H    WHEREAS, the Borrower, certain Domestic Subsidiaries of the Borrower party from time to  time party thereto (the “Guarantors”), certain banks and financial institutions from time to time party  thereto (the “Lenders”) and the Administrative Agent are parties to that certain Second Amended and  Restated Credit Agreement dated as of August 25, 2020, as amended (as amended, modified, extended,  restated, replaced, or supplemented from time to time, the “Credit Agreement”). Capitalized terms used  herein and not otherwise defined herein shall have the meanings ascribed thereto in the Credit Agreement;    WHEREAS, the Loan Parties have requested that the Required Lenders amend certain provisions  of the Credit Agreement; and    WHEREAS, the Required Lenders are willing to make such amendments to the Credit  Agreement, in accordance with and subject to the terms and conditions set forth herein.    NOW, THEREFORE, in consideration of the agreements hereinafter set forth, and for other  good and valuable consideration, the receipt and adequacy of which are hereby acknowledged, the parties  hereto agree as follows:    ARTICLE I  AMENDMENTS TO CREDIT AGREEMENT    1.1 New Definitions. The following definitions are hereby added to Section 1.01 of the  Credit Agreement in the appropriate alphabetical order:    “Affected Financial Institution” means (a) any EEA Financial Institution or (b) any UK Financial  Institution.    “Bloomberg” means Bloomberg Index Services Limited.    “BSBY” means the Bloomberg Short-Term Bank Yield Index rate.    “BSBY Daily Floating Rate Loan” means a Revolving Loan that bears interest at a rate based on  clause (a) of the definition of “BSBY Rate”;    “BSBY Fixed Rate Loan” means a Revolving Loan that bears interest at a rate based on clause (b)  of the definition of “BSBY Rate”.    “BSBY Rate” means:    (a) for any interest calculation with respect to a BSBY Daily Floating Rate Loan on  any date, a fluctuating rate of interest, which can change on each Business Day, equal to the  BSBY Screen Rate, two (2) Business Days prior to such day, for Dollar deposits with a term  

 

2      equivalent to one (1) month beginning on that date; provided, that if the rate is not published on  such determination date then the BSBY Daily Floating Rate means the BSBY Screen Rate for  Dollar deposits with a term equivalent to one (1) month on the first Business Day immediately  prior thereto; and    (b) for any Interest Period with respect to a BSBY Rate Loan, the rate per annum  equal to the BSBY Screen Rate two Business Days prior to the commencement of such Interest  Period with a term equivalent to such Interest Period; provided that if the rate is not published on  such determination date then BSBY Rate means the BSBY Screen Rate on the first Business Day  immediately prior thereto; and    (c) for any interest calculation with respect to a Base Rate Loan on any date, the rate  per annum equal to the BSBY Screen Rate with a term of one month commencing that day;    provided that if the BSBY Rate determined in accordance with either of the foregoing provisions (a), (b)  or (c) of this definition would otherwise be less than zero, the BSBY Rate shall be deemed zero for  purposes of this Agreement.    “BSBY Rate Loan” means a Revolving Loan that bears interest at a rate based on the BSBY Rate.  “BSBY Screen Rate” means the Bloomberg Short-Term Bank Yield Index rate administered by  Bloomberg and published on the applicable Bloomberg screen page (or such other commercially available  source providing such quotations as may be designated by the Administrative Agent from time to time).    “Communication” means this Agreement, any Loan Document and any document, any  amendment, approval, consent, information, notice, certificate, request, statement, disclosure or  authorization related to any Loan Document.    “Conforming Changes” means, with respect to the use, administration of or any conventions  associated with BSBY or any proposed Successor Rate, as applicable, any conforming changes to the  definitions of Base Rate, BSBY and Interest Period, timing and frequency of determining rates and  making payments of interest and other technical, administrative or operational matters (including, for the  avoidance of doubt, the definition of Business Day, timing of borrowing requests or prepayment,  conversion or continuation notices and length of lookback periods) as may be appropriate, in the  discretion of the Administrative Agent, to reflect the adoption and implementation of such applicable rate,  and to permit the administration thereof by the Administrative Agent in a manner substantially consistent  with market practice (or, if the Administrative Agent determines that adoption of any portion of such  market practice is not administratively feasible or that no market practice for the administration of such  rate exists, in such other manner of administration as the Administrative Agent determines is reasonably  necessary in connection with the administration of this Agreement and any other Loan Document).    “Daily Simple SOFR” with respect to any applicable determination date means the secured  overnight financing rate (“SOFR”) published on such date by the Federal Reserve Bank of New York, as  the administrator of the benchmark (or a successor administrator) on the Federal Reserve Bank of New  York’s website (or any successor source).    “Electronic Record” and “Electronic Signature” shall have the meanings assigned to them,  respectively, by 15 USC §7006, as it may be amended from time to time.    “Resolution Authority” means an EEA Resolution Authority or, with respect to any UK Financial  Institution, a UK Resolution Authority.  

 

3      “SOFR Adjustment” with respect to Daily Simple SOFR means 0.26161% (26.161 basis points);  and with respect to Term SOFR means 0.11448% (11.448 basis points) for an interest period of one-  month’s duration, 0.26161% (26.161 basis points) for an interest period of three-month’s duration,  0.42826% (42.826 basis points) for an interest period of six-months’ duration, and 0.71513% (71.513  basis points) for an interest period of twelve–months’ duration.    “Successor Rate” has the meaning specified in Section 3.03(b).    “Term SOFR” means, for the applicable corresponding Interest Period of BSBY (or if any  Interest Period does not correspond to an interest period applicable to SOFR, the closest corresponding  interest period of SOFR, and if such interest period of SOFR corresponds equally to two Interest Periods  of BSBY, the corresponding interest period of the shorter duration shall be applied) the forward-looking  term rate based on SOFR that has been selected or recommended by the Relevant Governmental Body.    “UK Financial Institution” means any BRRD Undertaking (as such term is defined under the  PRA Rulebook (as amended from time to time) promulgated by the United Kingdom Prudential  Regulation Authority) or any person subject to IFPRU 11.6 of the FCA Handbook (as amended from time  to time) promulgated by the United Kingdom Financial Conduct Authority, which includes certain credit  institutions and investment firms, and certain affiliates of such credit institutions or investment firms.    “UK Resolution Authority” means the Bank of England or any other public administrative  authority having responsibility for the resolution of any UK Financial Institution.    1.2 Amendment to Definitions. The following definitions hereby amend and restate the  definitions of the same defined terms set forth in Section 1.01 of the Credit Agreement:    “Applicable Rate” shall mean, for any day, a rate per annum equal to (a) in the case of Base Rate  Loans, 0%, (b) in the case of BSBY Rate Loans, 1.75%, (c) in the case of the Letter of Credit Fee, 1.75%  and (d) in the case of the Commitment Fee, 0.25%.    “Bail-In Action” means the exercise of any Write-Down and Conversion Powers by the  applicable Resolution Authority in respect of any liability of an Affected Financial Institution.    “Bail-In Legislation” means, (a) with respect to any EEA Member Country implementing  Article 55 of Directive 2014/59/EU of the European Parliament and of the Council of the European  Union, the implementing law, rule, regulation or requirement for such EEA Member Country from time  to time which is described in the EU Bail-In Legislation Schedule, and (b) with respect to the United  Kingdom, Part I of the United Kingdom Banking Act 2009 (as amended from time to time) and any other  law, regulation or rule applicable in the United Kingdom relating to the resolution of unsound or failing  banks, investment firms or other financial institutions or their affiliates (other than through liquidation,  administration or other insolvency proceedings).    “Base Rate” means for any day a fluctuating rate of interest per annum equal to the highest of  (a) the Federal Funds Rate plus 0.50%, (b) the rate of interest in effect for such day as publicly announced  from time to time by Bank of America as its “prime rate,” and (c) the BSBY Rate plus 1.00%, subject to  the interest rate floors set forth therein; provided that if the Base Rate shall be less than zero, such rate  shall be deemed zero for purposes of this Agreement. The “prime rate” is a rate set by Bank of America  based upon various factors including Bank of America’s costs and desired return, general economic  conditions and other factors, and is used as a reference point for pricing some loans, which may be priced  at, above, or below such announced rate. Any change in such prime rate announced by Bank of America  shall take effect at the opening of business on the day specified in the public announcement of such  

 

4      change. If the Base Rate is being used as an alternate rate of interest pursuant to Section 3.03 hereof, then  the Base Rate shall be the greater of clauses (a) and (b) above and shall be determined without reference  to clause (c) above.    “Business Day” means any day other than a Saturday, Sunday or other day on which commercial  banks are authorized to close under the Laws of, or are in fact closed in, the state where the  Administrative Agent’s Office is located and, if such day relates to any BSBY Rate Loan, in New York  City.    “ERISA Event” means (a) a Reportable Event with respect to a Pension Plan; (b) the withdrawal  of the Borrower or any ERISA Affiliate from a Pension Plan subject to Section 4063 of ERISA during a  plan year in which such entity was a “substantial employer” as defined in Section 4001(a)(2) of ERISA or  a cessation of operations that is treated as such a withdrawal under Section 4062(e) of ERISA; (c) a  complete or partial withdrawal by the Borrower or any ERISA Affiliate from a Multiemployer Plan or  notification that a Multiemployer Plan is insolvent; (d) the filing of a notice of intent to terminate, the  treatment of a Pension Plan amendment as a termination under Section 4041 or 4041A of ERISA; (e) the  institution by the PBGC of proceedings to terminate a Pension Plan; (f) any event or condition which  constitutes grounds under Section 4042 of ERISA for the termination of, or the appointment of a trustee  to administer, any Pension Plan; (g) the determination that any Pension Plan is considered an at-risk plan  or a plan in endangered or critical status within the meaning of Sections 430, 431 and 432 of the Code or  Sections 303, 304 and 305 of ERISA; (h) the imposition of any liability under Title IV of ERISA, other  than for PBGC premiums due but not delinquent under Section 4007 of ERISA, upon the Borrower or  any ERISA Affiliate or (i) a failure by the Borrower or any ERISA Affiliate to meet all applicable  requirements under the Pension Funding Rules in respect of a Pension Plan, whether or not waived, or the  failure by the Borrower or any ERISA Affiliate to make any required contribution to a Multiemployer  Plan.    “FATCA” means Sections 1471 through 1474 of the Code, as of the date of this Agreement (or  any amended or successor version that is substantively comparable and not materially more onerous to  comply with) and any current or future regulations or official interpretations thereof and any agreements  entered into pursuant to Section 1471(b)(1) of the Code, as of the date of this Agreement (or any amended  or successor version described above) and any intergovernmental agreement (and related fiscal or  regulatory legislation, or related official rules or practices) implementing the foregoing.    “Interest Payment Date” means, (a) as to any BSBY Fixed Rate Loan, the last day of each  Interest Period applicable to such Loan and the Maturity Date of the Facility under which such Loan was  made; provided, however, that if any Interest Period for a BSBY Rate Loan exceeds three (3) months, the  respective dates that fall every three (3) months after the beginning of such Interest Period shall also be  Interest Payment Dates; and (b) as to any BSBY Floating Rate Loan, Base Rate Loan or Swingline Loan,  the last Business Day of each March, June, September and December and the Maturity Date of the  Facility under which such Loan was made (with Swingline Loans being deemed made under the  Revolving Facility for purposes of this definition).    “Interest Period” means, as to each BSBY Fixed Rate Loan, the period commencing on the date  such BSBY Rate Loan is disbursed or converted to or continued as a BSBY Rate Loan and ending on the  date one (1), three (3) or six (6) months thereafter (in each case, subject to availability), as selected by the  Borrower in its Loan Notice; provided that:    (a) any Interest Period that would otherwise end on a day that is not a Business Day  shall be extended to the next succeeding Business Day unless, in the case of a BSBY Rate Loan,  

 

5      such Business Day falls in another calendar month, in which case such Interest Period shall end  on the next preceding Business Day;    (b) any Interest Period pertaining to a BSBY Rate Loan that begins on the last  Business Day of a calendar month (or on a day for which there is no numerically corresponding  day in the calendar month at the end of such Interest Period) shall end on the last Business Day of  the calendar month at the end of such Interest Period; and    (c) no Interest Period shall extend beyond the Maturity Date of the Facility under  which such Loan was made.    “Loan Notice” means a notice of (a) a Borrowing, (b) a conversion of Loans from one Type to the  other, or (c) a continuation of BSBY Rate Loans, pursuant to Section 2.02(a), which shall be substantially  in the form of Exhibit E or such other form as may be approved by the Administrative Agent (including  any form on an electronic platform or electronic transmission system as shall be approved by the  Administrative Agent), appropriately completed and signed by a Responsible Officer of the Borrower.    “Relevant Governmental Body” means the Board of Governors of the Federal Reserve System or  the Federal Reserve Bank of New York, or a committee officially endorsed or convened by the Board of  Governors of the Federal Reserve Systems or the Federal Reserve Bank of New York, or any successor  thereto.    “Type” means, with respect to a Loan, its character as a Base Rate Loan, a BSBY Fixed Rate  Loan or a BSBY Floating Rate Loan.    “Write-Down and Conversion Powers” means, (a) with respect to any EEA Resolution Authority,  the write-down and conversion powers of such EEA Resolution Authority from time to time under the  Bail-In Legislation for the applicable EEA Member Country, which write-down and conversion powers  are described in the EU Bail-In Legislation Schedule, and (b) with respect to the United Kingdom, any  powers of the applicable Resolution Authority under the Bail-In Legislation to cancel, reduce, modify or  change the form of a liability of any UK Financial Institution or any contract or instrument under which  that liability arises, to convert all or part of that liability into shares, securities or obligations of that  person or any other person, to provide that any such contract or instrument is to have effect as if a right  had been exercised under it or to suspend any obligation in respect of that liability or any of the powers  under that Bail-In Legislation that are related to or ancillary to any of those powers.    1.3 Deletion of Definitions. The defined terms “Eurodollar Fixed Rate Loan”, ”Eurodollar  Floating Rate Loan,” “Eurodollar Rate”, “Eurodollar Rate Loans”, “Impacted Loans”, “LIBOR”,  “LIBOR Screen Rate,” ”LIBOR Successor Rate,” “LIBOR Successor Rate Conforming Changes” and  “London Banking Day” are hereby deleted from Section 1.01 of the Credit Agreement.    1.4 Amendment to Section 1.08. Section 1.08 of the Credit Agreement is hereby amended  and restated in its entirety to read as follows:    1.08 Interest Rates.    The Administrative Agent does not warrant, nor accept responsibility, nor shall the  Administrative Agent have any liability with respect to the administration, submission or any other matter  related to any reference rate referred to herein or with respect to any rate (including, for the avoidance of  doubt, the selection of such rate and any related spread or other adjustment) that is an alternative or  replacement for or successor to any such rate (including, without limitation, any Successor Rate) (or any  

 

6      component of any of the foregoing) or the effect of any of the foregoing, or of any Conforming Changes.  The Administrative Agent and its affiliates or other related entities may engage in transactions or other  activities that affect any reference rate referred to herein, or any alternative, successor or replacement rate  (including, without limitation, any Successor Rate) (or any component of any of the foregoing) or any  related spread or other adjustments thereto, in each case, in a manner adverse to the Borrower. The  Administrative Agent may select information sources or services in its reasonable discretion to ascertain  any reference rate referred to herein or any alternative, successor or replacement rate (including, without  limitation, any Successor Rate) (or any component of any of the foregoing), in each case pursuant to the  terms of this Agreement, and shall have no liability to the Borrower, any Lender or any other person or  entity for damages of any kind, including direct or indirect, special, punitive, incidental or consequential  damages, costs, losses or expenses (whether in tort, contract or otherwise and whether at law or in equity),  for any error or other action or omission related to or affecting the selection, determination, or calculation  of any rate (or component thereof) provided by any such information source or service.    1.5 Replacement of Eurodollar and LIBOR Terms. The Credit Agreement is hereby  amended by replacing terms and provisions related to Eurodollar Rate Loans with terms and provisions  related to BSBY Rate Loans, as follows:    (a) Each reference in the Credit Agreement to “Eurodollar Rate” is hereby stricken and  replaced with “BSBY Rate”;    (b) Each reference in the Credit Agreement to “Eurodollar Floating Rate Loans” is hereby  stricken and replaced with “BSBY Daily Floating Rate Loans”;    (c) Each reference in the Credit Agreement to “Eurodollar Fixed Rate Loans” is hereby  stricken and replaced with “BSBY Fixed Rate Loans”.    (d) In Section 3.02, the words “or any Governmental Authority has imposed material  restrictions on the authority of such Lender to purchase or sell, or to take deposits of, Dollars in the  London interbank market,” are hereby stricken in their entirety.    (e) In Section 3.04((a)(i) the parenthetical “(except and reserve requirement contemplated by  Section 3.04(d))” is hereby stricken in its entirety.    (f) In Section 3.04(a)(ii) the words “or London interbank market” are hereby stricken in their  entirety.    (g) Section 3.04(d) is hereby stricken in its entirety.    (h) The final sentence of Section 3.05 is hereby stricken in its entirety.    1.6 Amendment to Section 2.02. Section 2.02 of the Credit Agreement is hereby amended  by adding subsection (g) to read as follows:    (g)  With respect to BSBY the Administrative Agent will have the right to make Conforming  Changes from time to time and, notwithstanding anything to the contrary herein or in any other Loan  Document, any amendments implementing such Conforming Changes will become effective without any  further action or consent of any other party to this Agreement or any other Loan Document; provided that,  with respect to any such amendment effected, the Administrative Agent shall post each such amendment  implementing such Conforming Changes to the Borrower and the Lenders reasonably promptly after such  amendment becomes effective.  

 

7      1.7 Amendment to Section 3.03. Section 3.03 of the Credit Agreement is hereby amended  and restated in its entirety to read as follows:    3.03 Inability to Determine Rates    (a) If in connection with any request for a BSBY Rate Loan or a conversion to or  continuation thereof, as applicable, (i) the Administrative Agent determines (which determination shall be  conclusive absent manifest error) that (A) no Successor Rate has been determined in accordance with  Section 3.03(b), and the circumstances under clause (i) of Section 3.03(b) or the Scheduled Unavailability  Date has occurred (as applicable) or (B) adequate and reasonable means do not otherwise exist for  determining BSBY for any requested Interest Period with respect to a proposed BSBY Rate Loan or in  connection with an existing or proposed Base Rate Loan or (ii) the Administrative Agent or the Required  Lenders determine that for any reason that the BSBY Rate for any requested Interest Period with respect  to a proposed BSBY Rate Loan does not adequately and fairly reflect the cost to such Lenders of funding  such Loan, the Administrative Agent will promptly so notify the Borrower and each Lender. Thereafter,  (x) the obligation of the Lenders to make or maintain BSBY Rate Loans or to convert Base Rate Loans to  BSBY Rate Loans shall be suspended (to the extent of the affected BSBY Rate Loans or Interest Periods),  and (y) in the event of a determination described in the preceding sentence with respect to the BSBY Rate  component of the Base Rate, the utilization of the BSBY Rate component in determining the Base Rate  shall be suspended, in each case until the Administrative Agent (or, in the case of a determination by the  Required Lenders described in clause (ii) of this Section 3.03(a), until the Administrative Agent upon  instruction of the Required Lenders) revokes such notice. Upon receipt of such notice, (i) the Borrower  may revoke any pending request for a Borrowing of, conversion to or continuation of BSBY Rate Loans  (to the extent of the affected BSBY Rate Loans or Interest Periods) or, failing that, will be deemed to  have converted such request into a request for a Borrowing of Base Rate Loans in the amount specified  therein and (ii) any outstanding BSBY Rate Loans shall be deemed to have been converted to Base Rate  Loans immediately at the end of their respective applicable Interest Period.    (b) Notwithstanding anything to the contrary in this Agreement or any other Loan  Documents, but without limiting this Section 3.03, if the Administrative Agent determines (which  determination shall be conclusive and binding upon all parties hereto absent manifest error), or the  Borrower or Required Lenders notify the Administrative Agent (with, in the case of the Required  Lenders, a copy to the Borrower) that the Borrower or Required Lenders (as applicable) have determined  (which determination likewise shall be conclusive and binding upon all parties hereto absent manifest  error), that:  (i) adequate and reasonable means do not exist for ascertaining one month, three  month and six month interest periods of BSBY including, without limitation, because the BSBY  Screen Rate is not available or published on a current basis and such circumstances are unlikely  to be temporary; or    (ii) Bloomberg or any successor administrator of the BSBY Screen Rate or a  Governmental Authority having jurisdiction over the Administrative Agent or Bloomberg or such  administrator with respect to its publication of BSBY, in each case acting in such capacity, has  made a public statement identifying a specific date after which one month, three month and six  month interest periods of BSBY or the BSBY Screen Rate shall or will no longer be made  available, or permitted to be used for determining the interest rate of U.S. dollar denominated  syndicated loans, or shall or will otherwise cease, provided that, at the time of such statement,  there is no successor administrator that is satisfactory to the Administrative Agent, that will  continue to provide such interest periods of BSBY after such specific date (the latest date on  which one month, three month and six month interest periods of BSBY or the BSBY Screen Rate  are no longer available permanently or indefinitely, the “Scheduled Unavailability Date”);  

 

8      then, on a date and time determined by the Administrative Agent (any such date, the “BSBY Replacement  Date”), which date shall be at the end of an Interest Period or on the relevant interest payment date, as  applicable, for interest calculated and, solely with respect to clause (ii) above, no later than the Scheduled  Unavailability Date, BSBY will be replaced hereunder and under any Loan Document with, subject to the  proviso below, the first available alternative set forth in the order below for any payment period for  interest calculated that can be determined by the Administrative Agent, in each case, without any  amendment to, or further action or consent of any other party to, this Agreement or any other Loan  Document (the “Successor Rate):    (x) Term SOFR plus the SOFR Adjustment; and  (y) Daily Simple SOFR plus the SOFR Adjustment;  provided that, if initially BSBY is replaced with the rate contained in clause (y) above (Daily Simple  SOFR plus the SOFR Adjustment) and subsequent to such replacement, the Administrative Agent  determines that Term SOFR has become available and is administratively feasible for the Administrative  Agent in its sole discretion, and the Administrative Agent notifies the Borrower and each Lender of such  availability, then from and after the beginning of the Interest Period, relevant interest payment date or  payment period for interest calculated, in each case, commencing no less than thirty (30) days after the  date of such notice, the Successor Rate shall be Term SOFR plus the SOFR Adjustment.  If the Successor Rate is Daily Simple SOFR plus the SOFR Adjustment, all interest payments will be  payable on a quarterly basis.  Notwithstanding anything to the contrary herein, (i) if the Administrative Agent determines that neither of  the alternatives set forth in clauses (x) and (y) above are available on or prior to the BSBY Replacement  Date or (ii) if the events or circumstances of the type described in Section 3.03(b)(i) or (ii) have occurred  with respect to the Successor Rate then in effect, then in each case, the Administrative Agent and the  Borrower may amend this Agreement solely for purpose of replacing BSBY or any then current  Successor Rate in accordance with this Section 3.03 at the end of any Interest Period, relevant interest  payment date or payment period for interest calculated, as applicable, with another alternate benchmark  rate giving due consideration to any evolving or then existing convention for similar U.S. dollar  denominated credit facilities syndicated and agented in the United States for such alternative benchmarks  and, in each case, including any mathematical or other adjustments to such benchmark giving due  consideration to any evolving or then existing convention for similar U.S. dollar denominated credit  facilities syndicated and agented in the United States for such benchmarks which adjustment or method  for calculating such adjustment shall be published on an information service as selected by the  Administrative Agent from time to time in its reasonable discretion and may be periodically updated. For  the avoidance of doubt, any such proposed rate and adjustments shall constitute a “Successor Rate”. Any  such amendment shall become effective at 5:00 p.m. on the fifth Business Day after the Administrative  Agent shall have posted such proposed amendment to all Lenders and the Borrower unless, prior to such  time, Lenders comprising the Required Lenders have delivered to the Administrative Agent written notice  that such Required Lenders object to such amendment.    The Administrative Agent will promptly (in one or more notices) notify the Borrower and each Lender of  the implementation of any Successor Rate.    Any Successor Rate shall be applied in a manner consistent with market practice; provided that to the  extent such market practice is not administratively feasible for the Administrative Agent, such Successor  Rate shall be applied in a manner as otherwise reasonably determined by the Administrative Agent.  

 

9      Notwithstanding anything else herein, if at any time any Successor Rate as so determined would  otherwise be less than 0.00%, the Successor Rate will be deemed to be 0.00% for the purposes of this  Agreement and the other Loan Documents.    In connection with the implementation of a Successor Rate, the Administrative Agent will have the right  to make Conforming Changes from time to time and, notwithstanding anything to the contrary herein or  in any other Loan Document, any amendments implementing such Conforming Changes will become  effective without any further action or consent of any other party to this Agreement; provided that, with  respect to any such amendment effected, the Administrative Agent shall post each such amendment  implementing such Conforming Changes to the Borrower and the Lenders reasonably promptly after such  amendment becomes effective.    1.8 Amendment to Section 11.10. Section 11.10 of the Credit Agreement is hereby  amended and restated in its entirety to read as follows:    11.10 Integration; Effectiveness.    This Agreement, the other Loan Documents, and any separate letter agreements with respect to  fees payable to the Administrative Agent or the L/C Issuer, constitute the entire contract among the  parties relating to the subject matter hereof and supersede any and all previous agreements and  understandings, oral or written, relating to the subject matter hereof. Except as provided in Section 4.01,  this Agreement shall become effective when it shall have been executed by the Administrative Agent and  when the Administrative Agent shall have received counterparts hereof that, when taken together, bear the  signatures of each of the other parties hereto, and thereafter shall be binding upon and inure to the benefit  of the parties hereto and their respective successor and assigns.    1.9 Amendment to Section 11.18. Section 11.18 of the Credit Agreement is hereby  amended and restated in its entirety to read as follows:    11.18 Electronic Execution; Electronic Records; Counterparts.    This Agreement, any Loan Document and any other Communication, including Communications  required to be in writing, may be in the form of an Electronic Record and may be executed using  Electronic Signatures. Each of the Loan Parties and each of the Administrative Agent, the L/C Issuer, the  Swingline Lender, and each Lender (collectively, each a “Credit Party”) agrees that any Electronic  Signature on or associated with any Communication shall be valid and binding on such Person to the  same extent as a manual, original signature, and that any Communication entered into by Electronic  Signature, will constitute the legal, valid and binding obligation of such Person enforceable against such  Person in accordance with the terms thereof to the same extent as if a manually executed original  signature was delivered. Any Communication may be executed in as many counterparts as necessary or  convenient, including both paper and electronic counterparts, but all such counterparts are one and the  same Communication. For the avoidance of doubt, the authorization under this paragraph may include,  without limitation, use or acceptance of a manually signed paper Communication which has been  converted into electronic form (such as scanned into PDF format), or an electronically signed  Communication converted into another format, for transmission, delivery and/or retention. The  Administrative Agent and each of the Credit Parties may, at its option, create one or more copies of any  Communication in the form of an imaged Electronic Record (“Electronic Copy”), which shall be deemed  created in the ordinary course of such Person’s business, and destroy the original paper document. All  Communications in the form of an Electronic Record, including an Electronic Copy, shall be considered  an original for all purposes, and shall have the same legal effect, validity and enforceability as a paper  record. Notwithstanding anything contained herein to the contrary, neither the Administrative Agent, L/C  

 

10      Issuer nor Swingline Lender is under any obligation to accept an Electronic Signature in any form or in  any format unless expressly agreed to by such Person pursuant to procedures approved by it; provided,  further, without limiting the foregoing, (a) to the extent the Administrative Agent, L/C Issuer and/or  Swingline Lender has agreed to accept such Electronic Signature, the Administrative Agent and each of  the Credit Parties shall be entitled to rely on any such Electronic Signature purportedly given by or on  behalf of any Loan Party and/or any Credit Party without further verification and (b) upon the request of  the Administrative Agent or any Credit Party, any Electronic Signature shall be promptly followed by  such manually executed counterpart. For purposes hereof, “Electronic Record” and “Electronic  Signature” shall have the meanings assigned to them, respectively, by 15 USC §7006, as it may be  amended from time to time.    Neither the Administrative Agent, L/C Issuer nor Swingline Lender shall be responsible for or have any  duty to ascertain or inquire into the sufficiency, validity, enforceability, effectiveness or genuineness of  any Loan Document or any other agreement, instrument or document (including, for the avoidance of  doubt, in connection with the Administrative Agent’s, L/C Issuer’s or Swingline Lender’s reliance on any  Electronic Signature transmitted by telecopy, emailed .pdf or any other electronic means). The  Administrative Agent, L/C Issuer and Swingline Lender shall be entitled to rely on, and shall incur no  liability under or in respect of this Agreement or any other Loan Document by acting upon, any  Communication (which writing may be a fax, any electronic message, Internet or intranet website posting  or other distribution or signed using an Electronic Signature) or any statement made to it orally or by  telephone and believed by it to be genuine and signed or sent or otherwise authenticated (whether or not  such Person in fact meets the requirements set forth in the Loan Documents for being the maker thereof).  Each of the Loan Parties and each Credit Party hereby waives (i) any argument, defense or right to contest  the legal effect, validity or enforceability of this Agreement, any other Loan Document based solely on  the lack of paper original copies of this Agreement, such other Loan Document, and (ii) waives any claim  against the Administrative Agent, each Credit Party and each Related Party for any liabilities arising  solely from the Administrative Agent’s and/or any Credit Party’s reliance on or use of Electronic  Signatures, including any liabilities arising as a result of the failure of the Loan Parties to use any  available security measures in connection with the execution, delivery or transmission of any Electronic  Signature.  1.10 Amendment to Section 11.20. Section 11.20 of the Credit Agreement is hereby  amended by striking the words “EEA Financial Institution” and replacing them with “Affected Financial  Institutions”, and by striking the words “an EEA Regulatory Authority” and “any EEA Regulatory  Authority” and replacing them with “the applicable Regulatory Authority.”    ARTICLE II  CONDITIONS TO EFFECTIVENESS    2.1 Closing Conditions. This Amendment shall become effective as of the day and year set  forth above (the “Amendment Effective Date”) upon satisfaction of the following conditions (in each  case, in form and substance reasonably acceptable to the Administrative Agent) on or prior to August 5,  2022:    (a) Executed Amendment. The Administrative Agent shall have received a copy of  this Amendment duly executed by each of the Loan Parties, the Required Lenders and the  Administrative Agent.    (b) Default. After giving effect to this Amendment, no Default or Event of Default  shall exist.  

 

11      (c) Miscellaneous. All other documents and legal matters in connection with the  transactions contemplated by this Amendment shall be reasonably satisfactory in form and  substance to the Administrative Agent and its counsel.    ARTICLE III  MISCELLANEOUS    3.1 Amended Terms. On and after the Amendment Effective Date, all references to the  Credit Agreement in each of the Loan Documents shall hereafter mean the Credit Agreement as amended  by this Amendment. Except as specifically amended hereby or otherwise agreed, the Credit Agreement is  hereby ratified and confirmed and shall remain in full force and effect according to its terms.    3.2 Representations and Warranties of Loan Parties. Each of the Loan Parties represents  and warrants as follows:    (a) It has taken all necessary action to authorize the execution, delivery and  performance of this Amendment.    (b) This Amendment has been duly executed and delivered by such Person and  constitutes such Person’s legal, valid and binding obligation, enforceable in accordance with its  terms, except as such enforceability may be subject to (i) bankruptcy, insolvency, reorganization,  fraudulent conveyance or transfer, moratorium or similar laws affecting creditors’ rights generally  and (ii) general principles of equity (regardless of whether such enforceability is considered in a  proceeding at law or in equity).    (c) No consent, approval, authorization or order of, or filing, registration or  qualification with, any court or governmental authority or third party is required in connection  with the execution, delivery or performance by such Person of this Amendment.    (d) The representations and warranties set forth in Article V of the Credit Agreement  are true and correct as of the date hereof (except for those which expressly relate to an earlier  date).    (e) After giving effect to this Amendment, no event has occurred and is continuing  which constitutes a Default or an Event of Default.    (f) The Obligations are not reduced or modified by this Amendment and are not  subject to any offsets, defenses or counterclaims.    3.3 Reaffirmation of Obligations. Each Loan Party hereby ratifies the Credit Agreement  and acknowledges and reaffirms (a) that it is bound by all terms of the Credit Agreement applicable to it  and (b) that it is responsible for the observance and full performance of its respective Obligations.    3.4 Loan Document. This Amendment shall constitute a Loan Document under the terms of  the Credit Agreement.    3.5 Further Assurances. The Loan Parties agree to promptly take such action, upon the  request of the Administrative Agent, as is necessary to carry out the intent of this Amendment.  

 

12      3.6 Entirety. This Amendment and the other Loan Documents embody the entire agreement  among the parties hereto and supersede all prior agreements and understandings, oral or written, if any,  relating to the subject matter hereof.    3.7 Counterparts; Telecopy. This Amendment may be executed in any number of  counterparts, each of which when so executed and delivered shall be an original, but all of which shall  constitute one and the same instrument. Delivery of an executed counterpart of a signature page of this  Amendment or any other document required to be delivered hereunder, by fax transmission or e-mail  transmission (e.g. “pdf” or “tif”) shall be effective as delivery of a manually executed counterpart of this  Agreement. Without limiting the foregoing, upon the request of any party, such fax transmission or e-  mail transmission shall be promptly followed by such manually executed counterpart.    3.8 No Actions, Claims, Etc. As of the date hereof, each of the Loan Parties hereby  acknowledges and confirms that it has no knowledge of any actions, causes of action, claims, demands,  damages and liabilities of whatever kind or nature, in law or in equity, against the Administrative Agent,  the Lenders, or the Administrative Agent’s or the Lenders’ respective officers, employees,  representatives, agents, counsel or directors arising from any action by such Persons, or failure of such  Persons to act under the Credit Agreement on or prior to the date hereof.    3.9 GOVERNING LAW. THIS AMENDMENT SHALL BE GOVERNED BY, AND  SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH THE LAWS OF THE  STATE OF NEW YORK.    3.10 Successors and Assigns. This Amendment shall be binding upon and inure to the  benefit of the parties hereto and their respective successors and assigns.    3.11 Consent to Jurisdiction; Service of Process; Waiver of Jury Trial. The jurisdiction,  service of process and waiver of jury trial provisions set forth in Sections 11.14 and 11.15 of the Credit  Agreement are hereby incorporated by reference, mutatis mutandis.      [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]  

 

    IN WITNESS WHEREOF the parties hereto have caused this Amendment to be duly executed on  the date first above written.    BORROWER: USANA HEALTH SCIENCES, INC., a Utah  corporation      By:   Name: Jim H. Brown  Title: President      GUARANTORS: USANA ACQUISITION CORP., a Utah  corporation      By:   Name: Jim H. Brown  Title: President      USANA SENSÉ COMPANY, INC., a Utah  corporation      By:   Name: Jim H. Brown  Title: President      USANA HEALTH SCIENCES NEW ZEALAND,  INC. a Delaware corporation      By:   Name: Jim H. Brown  Title: President    USANA CANADA HOLDING, INC. a Delaware  corporation      By:   Name: Jim H. Brown  Title: President  

 

    FMG PRODUCTIONS, INC., a Utah corporation      By:   Name: Jim H. Brown  Title: President      INTERNATIONAL HOLDINGS, INC., a  Delaware corporation      By:   Name: Jim H. Brown  Title: President      USANA HEALTH SCIENCES CHINA, INC., a  Delaware corporation      By:   Name: Jim H. Brown  Title: President      PET LANE, INC., a Delaware corporation      By:   Name: Jim H. Brown  Title: President      UHS  ESSENTIAL  HEALTH PHILIPPINES,  INC., a Utah corporation      By:   Name: Jim H. Brown  Title: President  

 

    ADMINISTRATIVE AGENT: BANK OF AMERICA, N.A., in its capacity as Administrative  Agent      By:   Name: Stephanie McClure  Title: Senior Vice President    LENDERS: BANK OF AMERICA, N.A., in its capacity as Lender      By:   Name: Stephanie McClure  Title: Senior Vice President

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