Document:

Exhibit
10.18

EXECUTION COPY

 

BRIDGE LOAN AGREEMENT

dated as of January 15, 2007

among

HOSPIRA, INC.,

as the Borrower,

THE BANKS AND FINANCIAL INSTITUTIONS LISTED HEREIN,

as Lenders,

ABN AMRO INCORPORATED,

CITIGROUP GLOBAL MARKETS INC.

and

MORGAN STANLEY SENIOR FUNDING, INC.,

as Joint Lead Bookrunners and Joint Lead Arrangers,

ABN AMRO INCORPORATED

and

MORGAN STANLEY SENIOR FUNDING, INC.,

as Joint Syndication Agents,

and

CITICORP NORTH
AMERICA, INC.,

as Administrative Agent

 

BRIDGE LOAN AGREEMENT

TABLE OF
CONTENTS

	
  

  	
   

  	
   

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  SECTION 1. DEFINITIONS

  	
   

  	
  1

  
	
   

  	
   

  	
   

  
	
  1.1

  	
   

  	
  Certain Defined Terms

  	
   

  	
  1

  
	
  1.2

  	
   

  	
  Accounting Terms; Utilization of GAAP for Purposes
  of Calculations Under Agreement

  	
   

  	
  19

  
	
  1.3

  	
   

  	
  Other Definitional Provisions and Rules of
  Construction

  	
   

  	
  19

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  SECTION 2. AMOUNT AND TERMS OF COMMITMENTS AND
  LOANS

  	
   

  	
  20

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  2.1

  	
   

  	
  Commitment; Making of Loans

  	
   

  	
  20

  
	
  2.2

  	
   

  	
  Repayment

  	
   

  	
  21

  
	
  2.3

  	
   

  	
  Pro Rata Shares; Availability of Funds

  	
   

  	
  21

  
	
  2.4

  	
   

  	
  The Register; Evidence of Debt; Notes

  	
   

  	
  22

  
	
  2.5

  	
   

  	
  Interest on the Loans

  	
   

  	
  23

  
	
  2.6

  	
   

  	
  Fees

  	
   

  	
  26

  
	
  2.7

  	
   

  	
  Provisions Regarding Payments

  	
   

  	
  26

  
	
  2.8

  	
   

  	
  Increased Costs; Taxes

  	
   

  	
  29

  
	
  2.9

  	
   

  	
  Special Provisions Governing LIBOR Rate Loans

  	
   

  	
  32

  
	
  2.10

  	
   

  	
  Defaulting Lenders

  	
   

  	
  34

  
	
  2.11

  	
   

  	
  Removal or Replacement of a Lender

  	
   

  	
  34

  
	
  2.12

  	
   

  	
  Mitigation

  	
   

  	
  35

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  SECTION 3. CONDITIONS PRECEDENT

  	
   

  	
  36

  
	
   

  	
   

  	
   

  
	
  3.1

  	
   

  	
  Conditions to Effectiveness

  	
   

  	
  36

  
	
  3.2

  	
   

  	
  Conditions Precedent to each Loan

  	
   

  	
  37

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  SECTION 4. REPRESENTATIONS AND WARRANTIES

  	
   

  	
  39

  
	
   

  	
   

  	
   

  
	
  4.1

  	
   

  	
  Organization, Powers, Qualification, Good Standing,
  Business and Subsidiaries

  	
   

  	
  39

  
	
  4.2

  	
   

  	
  Authorization of Borrowing, etc.

  	
   

  	
  39

  
	
  4.3

  	
   

  	
  Disclosure

  	
   

  	
  40

  
	
  4.4

  	
   

  	
  Financial Condition

  	
   

  	
  40

  
	
  4.5

  	
   

  	
  No Material Adverse Change

  	
   

  	
  41

  
	
  4.6

  	
   

  	
  Intellectual Property Matters

  	
   

  	
  41

  
	
  4.7

  	
   

  	
  No Litigation; Compliance with Laws

  	
   

  	
  41

  
	
  4.8

  	
   

  	
  No Default

  	
   

  	
  42

  
	
  4.9

  	
   

  	
  Governmental Regulation

  	
   

  	
  42

  
	
  4.10

  	
   

  	
  Securities Activities

  	
   

  	
  42

  
	
  4.11

  	
   

  	
  Employee Benefit Plans

  	
   

  	
  42

  
	
  4.12

  	
   

  	
  Environmental Protection

  	
   

  	
  43

  
	
  4.13

  	
   

  	
  Pari Passu

  	
   

  	
  44

  

 

 i
 

 

	
  4.14

  	
   

  	
  Restrictions

  	
   

  	
  44

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  SECTION 5. AFFIRMATIVE COVENANTS

  	
   

  	
  44

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  5.1

  	
   

  	
  Financial Statements and Other Reports

  	
   

  	
  44

  
	
  5.2

  	
   

  	
  Books and Records

  	
   

  	
  46

  
	
  5.3

  	
   

  	
  Existence

  	
   

  	
  47

  
	
  5.4

  	
   

  	
  Insurance

  	
   

  	
  47

  
	
  5.5

  	
   

  	
  Payment of Taxes and Claims

  	
   

  	
  47

  
	
  5.6

  	
   

  	
  Payment and Performance of Obligations

  	
   

  	
  47

  
	
  5.7

  	
   

  	
  Maintenance of Properties

  	
   

  	
  47

  
	
  5.8

  	
   

  	
  Compliance with Laws

  	
   

  	
  48

  
	
  5.9

  	
   

  	
  Use of Proceeds

  	
   

  	
  48

  
	
  5.10

  	
   

  	
  Claims Pari Passu

  	
   

  	
  48

  
	
  5.11

  	
   

  	
  Further Assurances

  	
   

  	
  48

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  SECTION 6. NEGATIVE COVENANTS

  	
   

  	
  48

  
	
   

  	
   

  	
   

  
	
  6.1

  	
   

  	
  Liens

  	
   

  	
  49

  
	
  6.2

  	
   

  	
  Indebtedness

  	
   

  	
  50

  
	
  6.3

  	
   

  	
  Acquisitions

  	
   

  	
  52

  
	
  6.4

  	
   

  	
  Restrictions on Subsidiary Distributions

  	
   

  	
  52

  
	
  6.5

  	
   

  	
  Restricted Payments

  	
   

  	
  52

  
	
  6.6

  	
   

  	
  Restriction on Fundamental Changes and Asset Sales

  	
   

  	
  52

  
	
  6.7

  	
   

  	
  Conduct of Business

  	
   

  	
  53

  
	
  6.8

  	
   

  	
  Fiscal Year

  	
   

  	
  53

  
	
  6.9

  	
   

  	
  Subordinated Indebtedness

  	
   

  	
  53

  
	
  6.10

  	
   

  	
  Transactions with Shareholders and Affiliates

  	
   

  	
  53

  
	
  6.11

  	
   

  	
  Financial Covenants

  	
   

  	
  54

  
	
  6.12

  	
   

  	
  Interest Rate Agreements and Currency Agreements

  	
   

  	
  55

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  SECTION 7. EVENTS OF DEFAULT

  	
   

  	
  55

  
	
   

  	
   

  	
   

  
	
  7.1

  	
   

  	
  Failure to Make Payments When Due

  	
   

  	
  55

  
	
  7.2

  	
   

  	
  Default in Other Agreements

  	
   

  	
  55

  
	
  7.3

  	
   

  	
  Breach of Certain Covenants

  	
   

  	
  55

  
	
  7.4

  	
   

  	
  Breach of Representation or Warranty

  	
   

  	
  56

  
	
  7.5

  	
   

  	
  Other Defaults Under Loan Documents

  	
   

  	
  56

  
	
  7.6

  	
   

  	
  Involuntary Bankruptcy; Appointment of Receiver, etc.

  	
   

  	
  56

  
	
  7.7

  	
   

  	
  Voluntary Bankruptcy; Appointment of Receiver, etc.

  	
   

  	
  56

  
	
  7.8

  	
   

  	
  Judgments and Attachments

  	
   

  	
  57

  
	
  7.9

  	
   

  	
  Dissolution

  	
   

  	
  57

  
	
  7.10

  	
   

  	
  Employee Benefit Plans

  	
   

  	
  57

  
	
  7.11

  	
   

  	
  Change in Control

  	
   

  	
  57

  
	
  7.12

  	
   

  	
  Repudiation of Obligations

  	
   

  	
  57

  
	
  7.13

  	
   

  	
  Material Adverse Change

  	
   

  	
  57

  

 

 ii
 

 

	
  SECTION 8. MISCELLANEOUS

  	
   

  	
  58

  
	
   

  	
   

  	
   

  
	
  8.1

  	
   

  	
  Assignments and Participations in Loans

  	
   

  	
  58

  
	
  8.2

  	
   

  	
  Expenses

  	
   

  	
  60

  
	
  8.3

  	
   

  	
  Indemnity

  	
   

  	
  61

  
	
  8.4

  	
   

  	
  Set-Off

  	
   

  	
  62

  
	
  8.5

  	
   

  	
  Amendments and Waivers

  	
   

  	
  62

  
	
  8.6

  	
   

  	
  Independence of Covenants

  	
   

  	
  63

  
	
  8.7

  	
   

  	
  Notices

  	
   

  	
  63

  
	
  8.8

  	
   

  	
  Survival of Representations, Warranties and
  Agreements

  	
   

  	
  64

  
	
  8.9

  	
   

  	
  Failure or Indulgence Not Waiver; Remedies
  Cumulative

  	
   

  	
  65

  
	
  8.10

  	
   

  	
  Marshalling; Payments Set Aside

  	
   

  	
  65

  
	
  8.11

  	
   

  	
  Severability

  	
   

  	
  65

  
	
  8.12

  	
   

  	
  Headings

  	
   

  	
  65

  
	
  8.13

  	
   

  	
  Applicable Law

  	
   

  	
  65

  
	
  8.14

  	
   

  	
  Successors and Assigns

  	
   

  	
  66

  
	
  8.15

  	
   

  	
  Consent to Jurisdiction and Service of Process

  	
   

  	
  66

  
	
  8.16

  	
   

  	
  Waiver of Jury Trial

  	
   

  	
  67

  
	
  8.17

  	
   

  	
  Confidentiality

  	
   

  	
  67

  
	
  8.18

  	
   

  	
  Ratable Sharing

  	
   

  	
  68

  
	
  8.19

  	
   

  	
  Counterparts; Effectiveness

  	
   

  	
  69

  
	
  8.20

  	
   

  	
  Obligations Several; Independent Nature of Lenders’
  Rights

  	
   

  	
  69

  
	
  8.21

  	
   

  	
  Usury Savings Clause

  	
   

  	
  69

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  SECTION 9. AGENTS

  	
   

  	
  70

  
	
   

  	
   

  	
   

  
	
  9.1

  	
   

  	
  Appointment

  	
   

  	
  70

  
	
  9.2

  	
   

  	
  Powers and Duties; General Immunity

  	
   

  	
  70

  
	
  9.3

  	
   

  	
  Representations and Warranties; No Responsibility
  For Appraisal of Creditworthiness

  	
   

  	
  72

  
	
  9.4

  	
   

  	
  Right to Indemnity

  	
   

  	
  72

  
	
  9.5

  	
   

  	
  Successor Administrative Agent

  	
   

  	
  73

  
	
  9.6

  	
   

  	
  Acknowledgment of Potential Related Transactions

  	
   

  	
  73

  

 

 iii
 

 

EXHIBITS

	
  I

  	
   

  	
  FORM OF NOTICE OF BORROWING

  
	
  II

  	
   

  	
  FORM OF CONVERSION/CONTINUATION NOTICE

  
	
  III

  	
   

  	
  FORM OF NOTE

  
	
  IV

  	
   

  	
  FORM OF CERTIFICATE RE NON-BANK STATUS

  
	
  V

  	
   

  	
  FORM OF ASSIGNMENT AGREEMENT

  
	
  VI

  	
   

  	
  FORM OF SECRETARY’S CERTIFICATE

  
	
  VII

  	
   

  	
  FORM OF OFFICER’S CERTIFICATE (SECTION 3.1A(v))

  
	
  VIII

  	
   

  	
  FORM OF OFFICER’S CERTIFICATE (SECTION 3.1A(vi))

  

 

 iv
 

 

SCHEDULES

	
  2.1A

  	
   

  	
  LENDERS’ COMMITMENTS AND PRO RATA SHARES

  
	
  6.1

  	
   

  	
  LIENS

  
	
  6.2

  	
   

  	
  SUBSIDIARY INDEBTEDNESS

  
	
  6.10

  	
   

  	
  TRANSACTIONS WITH AFFILIATES

  

 

 v

BRIDGE LOAN AGREEMENT

This
BRIDGE LOAN AGREEMENT is dated as of January 15, 2007 and entered into by and
among Hospira, Inc., a Delaware corporation (the “Borrower”), the banks and financial institutions listed on the
signature pages hereof (collectively, the “Initial
Lenders”), ABN AMRO Incorporated (“ABN
AMRO”), Citigroup Global Markets, Inc. (“CGMI”) and Morgan Stanley Senior Funding, Inc. (“MSSF”) as joint lead bookrunners and joint
lead arrangers (in such capacity, the “Lead
Arrangers”), ABN AMRO and MSSF as joint syndication agents (in such
capacity, the “Syndication Agents”),
and Citicorp North America, Inc. as administrative agent for the Lenders (“Citicorp” and in such capacity, the “Administrative Agent”).

PRELIMINARY STATEMENTS

The
Borrower has requested, and the Lenders have agreed to extend, term loans in
the amount and on the terms and conditions set forth herein.

NOW, THEREFORE, in consideration of the
mutual agreements contained herein, and other good and valuable consideration,
the receipt and sufficiency which are hereby acknowledged, the Borrower, the
Lenders, the Lead Arrangers, the Syndication Agents, the Documentation Agents
and the Administrative Agent agree as follows:

SECTION
1. DEFINITIONS

1.1                               Certain
Defined Terms.

The
following terms used in this Agreement shall have the following meanings:

“ABN AMRO” shall have the meaning ascribed
to such term in the introduction to this Agreement.

“Acquisition” means the purchase or other
acquisition (by merger or otherwise) by a Person of all of substantially all of
the assets of, or all of the Capital Stock of, or a business line or unit or a
division of, any other Person.

“Administrative Agent” shall have the
meaning ascribed to such term in the introduction to this Agreement.

“Affected Lender” shall have the meaning
ascribed to such term in Section 2.9B.

“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 10% or more of the
Securities having ordinary voting power for the election of directors of such
Person or (ii) to direct or cause the direction of the management and policies
of that Person, whether through the ownership of voting securities or by
contract or otherwise.

 

“Agents” means the Administrative Agent and
the Syndication Agents, collectively, and also means and includes any successor
Administrative Agent appointed pursuant to Section 9.5.

“Aggregate Amounts Due” shall have the
meaning ascribed to such term in Section 8.18.

“Agreement” means this Loan Agreement as it
may be amended, supplemented or otherwise modified from time to time.

“Applicable Law” means all applicable
provisions of constitutions, laws, statutes, ordinances, rules, treaties,
regulations, permits, licenses, approvals, interpretations and orders of courts
or Governmental Authorities and all orders and decrees of all courts and
arbitrators.

“Applicable Margin” means, as of any date, a
percentage per annum determined by reference to the applicable Performance
Level with respect to the Borrower in effect on such date, as set forth below:

	
  Performance Level

  	
   

  	
  Level I

  	
   

  	
  Level II

  	
   

  	
  Level III

  	
   

  	
  Level IV

  	
   

  	
  Level V

  	
   

  
	
  Base Rate Applicable Margin

  	
   

  	
  0

  	
  %

  	
  0

  	
  %

  	
  0

  	
  %

  	
  0

  	
  %

  	
  0.20

  	
  %

  
	
  LIBOR Applicable Margin

  	
   

  	
  0.350

  	
  %

  	
  0.450

  	
  %

  	
  0.600

  	
  %

  	
  0.700

  	
  %

  	
  1.200

  	
  %

  
	
  Commitment
  Fee

  	
   

  	
  0.075

  	
  %

  	
  0.090

  	
  %

  	
  0.100

  	
  %

  	
  0.150

  	
  %

  	
  0.250

  	
  %

  

 

For
purposes hereof, “Performance Level”
means, with respect to the Borrower, Performance Level I, Performance Level II,
Performance Level III, Performance Level IV or Performance Level V, as
identified by reference to the public debt rating of the Borrower, as the case
may be, in effect on such date as set forth below:

	
  Performance Level

  	
   

  	
  Public Debt Rating

  
	
  Level I

  	
   

  	
  Long Term Senior Unsecured Debt rated greater than
  or equal to A- by S&P or A3 by Moody’s

  
	
  Level II

  	
   

  	
  Long Term Senior Unsecured Debt rated greater than
  or equal to BBB+ by S&P or Baa1
  by Moody’s

  
	
  Level III

  	
   

  	
  Long Term Senior Unsecured Debt rated greater than
  or equal to BBB by S&P or Baa2 by Moody’s

  
	
  Level IV

  	
   

  	
  Long Term Senior Unsecured Debt rated greater than
  or equal to BBB- by S&P or Baa3 by Moody’s

  
	
  Level V

  	
   

  	
  Long Term Senior Unsecured Debt rated less than BBB- by S&P or Baa3 by Moody’s, and at all other times
  (including if such ratings are not available from both S&P and Moody’s)

  

 

 2
 

 

For
purposes of this definition, the Performance Level shall be determined by the
applicable public debt rating for the Borrower as follows:  (i) the public debt ratings shall be
determined by the then-current rating announced by either S&P or Moody’s,
as the case may be, for any class of non-credit-enhanced long-term senior
unsecured debt issued by the Borrower; (ii) if only one of S&P and Moody’s
shall have in effect such a public debt rating, the Performance Level shall be
determined by reference to the applicable rating; (iii) if neither S&P nor
Moody’s shall have in effect such a public debt rating, the applicable
Performance Level will be Level V; (iv) if such public debt ratings established
by S&P and Moody’s shall fall within different levels, the public debt
rating will be determined by the higher of the two ratings, provided
that, in the event that the lower of such public debt ratings is more than one
level below the higher of such public debt ratings, the public debt rating will
be determined based upon the level that is one level above the lower of such
public debt ratings; (v) if any such public debt rating established by S&P
or Moody’s shall be changed, such change shall be effective as of the date on
which such change is first announced publicly by the rating agency making such
change; and (vi) if S&P or Moody’s shall change the basis on which such
public debt ratings are established, each reference to the public debt rating
announced by S&P or Moody’s, as the case may be, shall refer to the
then-equivalent rating by S&P or Moody’s, as the case may be.

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

“Approved Fund” means any Fund that is
administered or managed by (a) a Lender, (b) an Affiliate of a Lender or (c) an
entity or an Affiliate of an entity that administers or manages a Lender.

“Asset Sale” means a sale, lease or
sub-lease (as lessor or sublessor), sale and leaseback transaction, assignment,
conveyance, transfer or other disposition to, or any exchange of property with,
any Person, in one transaction or a series of transactions, of all or any part
of the Borrower’s or any of its Subsidiary’s businesses, properties or assets
of any kind, whether real, personal, or mixed and whether tangible or
intangible, whether now owned or hereafter acquired, including the Capital
Stock of any Subsidiary of the Borrower, other than such businesses, properties
or assets sold in the ordinary course of business and consistent with past
business practice of the Borrower and its Subsidiaries.

 3
 

 

“Assignment Agreement” means an assignment
agreement, substantially in the form of Exhibit V hereto, satisfactory
in form and substance to the Administrative Agent.

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

“Base Rate” means, for any day, a rate per
annum equal to the greater of (i) the Prime Rate in effect on such day and (ii)
the Federal Funds Effective Rate in effect on such day plus 1⁄2 of 1%. Any change
in the Base Rate due to a change in the Prime Rate or the Federal Funds
Effective Rate shall be effective on the effective day of such change in the
Prime Rate or the Federal Funds Effective Rate, respectively.

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

“Borrower” shall have the meaning ascribed
to such term in the introduction to this Agreement.

“Borrowing” means a borrowing consisting of
Loans of the same Type that (i) are made, continued or converted on the same
day and (ii) in the case of LIBOR Rate Loans, have the same Interest Period.

“Business Day” means any day that is not a
Saturday, Sunday or other day on which commercial banks in New York City are
authorized or required by law to remain closed, provided that, when used
in connection with a LIBOR Rate Loan, the term “Business Day” shall also
exclude any day on which banks are not open for dealings in Dollar deposits in
the London interbank market.

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

“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.

“Cash” means money, currency or a credit
balance in any demand or deposit account.

“Certificate re Non-Bank Status” means a
certificate substantially in the form of Exhibit IV annexed hereto
delivered by a Lender to the Administrative Agent pursuant to Section
2.8B(iii)(b).

“CGMI” shall have the meaning ascribed to
such term in the introduction to this Agreement.

 4
 

 

“Change of Control” means (i) any Person or “group”
(within the meaning of Rules 13d 3 and 13d 5 under the Exchange Act) shall have
acquired beneficial ownership of 30% or more on a fully diluted basis of the
voting and/or economic interest in the Capital Stock of the Borrower; (ii) any
Person or “group” (within the meaning of Rules 13d 3 and 13d 5 under the
Exchange Act) shall have obtained the power (whether or not exercised) to elect
a majority of the members of the board of directors (or similar governing body)
of the Borrower; (iii) during any period of up to 24 consecutive months,
commencing before or after the date of this Agreement, a majority of the
members of the board of directors of the Borrower shall not be Continuing
Directors; or (iv) any Person or “group” (within the meaning of Rules 13d 3 and
13d 5 under the Exchange Act) shall have acquired by contract or otherwise, or
shall have entered into a contract or arrangement that, upon consummation, will
result in its or their acquisition of the power to exercise, directly or
indirectly, a controlling influence over the management or policies of the
Borrower.

“Citicorp” shall have the meaning ascribed
to such term in the introduction to this Agreement.

“Commitment” means the amount of the
commitment of a Lender to make a Loan hereunder and “Commitments” means such commitments of all Lenders in the
aggregate. The amount of each Lender’s Commitment, if any, is set forth on Schedule
2.1A or in the applicable Assignment Agreement, subject to any adjustment,
increase or reduction pursuant to the terms and conditions hereof. The
aggregate amount of the Commitments as of the date of this Agreement is
$1,425,000,000.

“Commitment Fee” shall have the meaning
ascribed to such term in Section 2.6(i).

             “Compliance
Certificate” means a certificate of the chief financial officer,
treasurer or controller of the Borrower setting forth computations in
reasonable detail demonstrating (i) compliance with the covenants set forth in
Section 6.11, as at the end of the period covered by such financial statements,
and (ii) certifying that such officer has obtained no knowledge of any
Potential Event of Default or Event of Default except as specified in such
certificate.

“Consolidated Adjusted EBITDA” means, in
respect of the Borrower and its Subsidiaries on a consolidated basis, for any
period, an amount equal to (i) the sum, without duplication, of the amounts for
such period of (a) Consolidated Net Income, (b) Consolidated Financing Expense,
(c) provisions for taxes based on income, (d) total depreciation expense, (e)
total amortization expense, and (f) other non-Cash items reducing Consolidated
Net Income (excluding any such non-Cash item to the extent that it represents
an accrual or reserve for potential Cash items in any future period or
amortization of a prepaid Cash item that was paid in a prior period) and (e)
Permitted Addbacks, minus (ii) other non-Cash items increasing
Consolidated Net Income for such period (excluding any such non-Cash item to
the extent it represents the reversal of an accrual or reserve for potential
Cash item in any prior period).

“Consolidated Financing Expense” means, in
respect of the Borrower and its Subsidiaries on a consolidated basis, for any
period, total interest expense (including that portion

 5
 

 

attributable to
Capital Leases in accordance with GAAP and capitalized interest) with respect
to all outstanding Indebtedness of the Borrower and its Subsidiaries, including
all commissions, discounts and other fees and charges owed with respect to any
letters of credit and bankers’ acceptance financing and net costs under
Interest Rate Agreements.

“Consolidated Net Income” means, in respect
of the Borrower and its Subsidiaries on a consolidated basis, for any period,
(i) the net income (or loss) for the Borrower and its Subsidiaries for such
period taken as a single accounting period determined in conformity with GAAP, minus
(ii) (a) the income (or loss) of any Person (other than a Subsidiary of the
Borrower) in which any other Person (other than the Borrower or any of its
Subsidiaries) has a joint interest, except to the extent of the amount of
dividends or other distributions actually paid to the Borrower or any of its
Subsidiaries by such Person during such period, (b) the income (or loss) of any
Person accrued prior to the date it becomes a Subsidiary of the Borrower or is
merged into or consolidated with the Borrower or any of its Subsidiaries or
that Person’s assets are acquired by the Borrower or any of its Subsidiaries,
(c) the income of any Subsidiary of the Borrower to the extent that the
declaration or payment of dividends or similar distributions by that Subsidiary
of that income is not at the time permitted by operation of the terms of its
charter or any agreement, instrument, judgment, decree, order, statute, rule or
governmental regulation applicable to that Subsidiary, (d) any after-tax gains
or losses attributable to Asset Sales or returned surplus assets of any Pension
Plan, and (e) (to the extent not included in clauses (a) through (d) above) any
net extraordinary gains or net non-cash extraordinary losses.

“Consolidated Net Worth” means, at any date
of determination, all items which in conformity with GAAP would be included
under shareholders’ equity on a consolidated balance sheet of the Borrower and
its Subsidiaries.

“Consolidated Total Debt” means, in respect
of the Borrower and its Subsidiaries on a consolidated basis, as at any date of
determination, the aggregate stated balance sheet amount of all Indebtedness,
determined on a consolidated basis in accordance with GAAP.

“Continuing Director” as applied to any
Person, means, for any period, an individual who is a member of the board of
directors of such Person on the first day of such period or whose election to
the board of directors of such Person is approved by a majority of the other
Continuing Directors.

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

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

“Conversion/Continuation Notice” means a
Conversion/Continuation Notice substantially in the form of Exhibit II.

“Credit Date” shall have the meaning
ascribed to such term in Section 2.1A.

 6
 

 

“Credit Exposure” means, with respect to any
Lender as of any date of determination, (i) prior to the termination of the
Commitments, that Lender’s Commitment; and (ii) after the termination of the
Commitments, the aggregate outstanding principal amount of the Loans of that
Lender.

“Currency Agreement” means any foreign
exchange contract, currency swap agreement, futures contract, option contract,
synthetic cap or other similar agreement or arrangement.

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

“Default Period” means, with respect to any
Defaulting Lender, the period commencing on the date of the applicable Funding
Default and ending on the earliest of the following dates:  (i) the date on which all the Obligations are
declared or become immediately due and payable, (ii) the date on which the
Default Excess with respect to such Defaulting Lender shall have been reduced
to zero (whether by the funding by such Defaulting Lender of its Defaulted Loan
or by the non pro rata application of any voluntary or mandatory prepayments of
the Loans in accordance with the terms of Section 2.7A or C) and (iii) the date
on which the Borrower, the Administrative Agent and the Requisite Lenders waive
all Funding Defaults of such Defaulting Lender in writing.

“Defaulted Loan” shall have the meaning
ascribed to such term in Section 2.10.

“Defaulting Lender” shall have the meaning
ascribed to such term in Section 2.10.

“Divestiture” means the sale by Borrower of
certain assets as required under the Consent Order relating to the Federal
Trade Commission’s termination of the waiting period under the Hart Scott
Rodino Antitrust Improvements Act of 1976 in connection with the Mayne Pharma
Acquisition.

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

“Effective Date” means the date on which the
conditions specified in Section 3.1 are satisfied or waived in accordance with
Section 8.5.

“Eligible Assignee” means (A) any Lender and
any Affiliate of any Lender; and (B) any commercial bank, savings and loan
association, savings 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; provided that no Affiliate of the Borrower or any of its
Subsidiaries shall be an Eligible Assignee.

 7
 

 

“Employee Benefit Plan” means any “employee
benefit plan” as defined in Section 3(3) of ERISA (other than a Multiemployer
Plan) which is or was maintained or contributed to by the Borrower or any of
its ERISA Affiliates.

“Environmental Claim” means any
investigation, notice, notice of violation, claim, action, suit, proceeding,
order, consent decree, settlement, 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 Materials 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 federal, state, local and foreign laws and regulations,
statutes, ordinances, orders, rules, guidance documents, judgments,
Governmental Authorizations, or any other requirements of Governmental
Authorities relating to (i) 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.

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

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

“ERISA Event” means (i) a “reportable event”
within the meaning of Section 4043 of ERISA and the regulations issued
thereunder with respect to any Pension Plan (excluding those for which 30-day
notice to the PBGC has been waived); (ii) the failure to meet the minimum
funding standard of Section 412 of the Internal Revenue Code with respect to
any Pension Plan (whether or not waived in accordance with Section 412(d) of
the Internal Revenue Code) or the failure to make by its due date a required
installment under Section 412(m) of the Internal Revenue Code with respect to
any Pension Plan or the failure to make any required contribution to a
Multiemployer Plan; (iii) the provision by the administrator of any Pension
Plan pursuant to Section 4041(a)(2) of ERISA of a notice of intent to terminate
such plan in a distress termination described in Section 4041(c) of ERISA; (iv)
the withdrawal by the Borrower or any of its ERISA Affiliates from any Pension
Plan with two or more contributing sponsors or the

 8
 

termination of any
such Pension Plan resulting in liability pursuant to Section 4063 or 4064 of
ERISA; (v) the institution by the PBGC of proceedings to terminate any Pension
Plan, or the occurrence of any event or condition which might reasonably
constitute grounds under ERISA for the termination of, or the appointment of a
trustee to administer, any Pension Plan; (vi) the imposition of liability on
the Borrower or any of its ERISA Affiliates pursuant to Section 4062(e) or 4069
of ERISA or by reason of the application of Section 4212(c) of ERISA; (vii) the
withdrawal by the Borrower, any of its Subsidiaries or any of their respective
ERISA Affiliates in a complete or partial withdrawal (within the meaning of
Sections 4203 and 4205 of ERISA) from any Multiemployer Plan if there is any
potential withdrawal liability to the Borrower or any of its ERISA Affiliates
as a result of the withdrawal, or the receipt by the Borrower or any of its
ERISA Affiliates of notice from any Multiemployer Plan that it is in
reorganization or insolvency pursuant to Section 4241 or 4245 of ERISA, or that
it intends to terminate or has terminated under Section 4041A or 4042 of ERISA;
(viii) the occurrence of an act or omission which could give rise to the
imposition on the Borrower, any of its Subsidiaries or any of their respective
ERISA Affiliates of fines, penalties, taxes or related charges under Chapter 43
of the Internal Revenue Code or under Section 409, Section 502(c), (i) or (l),
or Section 4071 of ERISA in respect of any Employee Benefit Plan, in each case
in an amount that would be material; (ix) the assertion of a material claim
(other than routine claims for benefits) against any Employee Benefit Plan or
the assets thereof, or against the Borrower or any of its ERISA Affiliates in
connection with any Employee Benefit Plan; (x) receipt from the Internal
Revenue Service of notice of the failure of any Pension Plan to qualify under
Section 401(a) of the Internal Revenue Code, or the failure of any trust
forming part of any Pension Plan to qualify for exemption from taxation under
Section 501(a) of the Internal Revenue Code; or (xi) the imposition of a Lien pursuant
to Section 401(a)(29) or 412(n) of the Internal Revenue Code or pursuant to
ERISA with respect to any Pension Plan.

“Event of Default” means each of the events
set forth in Section 7.

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

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

“Federal Funds Effective Rate” means for any
day, the rate per annum (expressed, as a decimal, rounded upwards, if
necessary, to the next higher 1/100 of 1%) equal to the weighted average of the
rates on overnight federal funds transactions with members of the Federal
Reserve System arranged by federal funds brokers on such day, as published by
the Federal Reserve Bank of New York on the Business Day next succeeding such
day; provided (i) if such day is not a Business Day, the Federal Funds
Rate for such day shall be such rate on such transactions on the next preceding
Business Day as so published on the next succeeding Business Day, and (ii) if
no such rate is so published on such next succeeding Business Day, the Federal
Funds Rate for such day shall be the average rate charged to Administrative
Agent, in its capacity as a Lender, on such day on such transactions as
determined by the Administrative Agent.

 9
 

 

“Fee Letters” means (i) the Fee Letter,
dated October 3, 2006, among the Borrower, MSSF, ABN and CGMI, as the same may
be amended, supplemented or otherwise modified from time to time and (ii) the
Fee Letter, dated October 3, 2006, between the Borrower and MSSF, as the same
may be amended, supplemented or otherwise modified from time to time.

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

“Fiscal Year” means the fiscal year of the
Borrower and its Subsidiaries (excluding any Subsidiary that is acquired after
the date hereof that has not yet changed its fiscal year to a calendar year)
ending on December 31 of each calendar year. For purposes of this Agreement,
any particular Fiscal Year shall be designated by reference to the calendar
year in which such Fiscal Year ends.

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

“Funding and Payment Office” means the
office of the Administrative Agent as set forth under the Administrative Agent’s
name on the signature pages hereof, or such other office designated in a
written notice delivered by the Administrative Agent to the Borrower and each
Lender.

“Funding Default” shall have the meaning
ascribed to such term in Section 2.10.

“GAAP” means, subject to the limitations on
the application thereof set forth in Section 1.2, generally accepted accounting
principles set forth in opinions and pronouncements of the Accounting
Principles Board of the American Institute of Certified Public Accountants and
statements and pronouncements of the Financial Accounting Standards Board or in
such other statements by such other entity as may be approved by a significant
segment of the United States accounting profession, in each case as the same
are applicable to the circumstances as of the date of determination.

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

“Governmental Authority” means any federal,
state, 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, 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, registration with, approval
of, consent order or consent decree of or from, or notice to any Governmental
Authority.

 10
 

 

“Hazardous Materials” means any chemical,
material or substance, (i) exposure to which is prohibited or limited by any
Governmental Authority, (ii) which is designated, classified or regulated as “hazardous”
or “toxic” or as a “pollutant” or “contaminant” under any Environmental Law or
(iii) 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” shall have the meaning
ascribed to such term in Section 8.21.

“Implementation Agreement” means the Scheme
Implementation Agreement dated September 20, 2006 among Mayne Pharma, Hospira
Holdings (S.A.) Pty Ltd and the Borrower.

“Indebtedness”, as applied to any Person,
means (i) all indebtedness for borrowed money; (ii) that portion of obligations
with respect to Capital Leases that is classified as a liability on a balance
sheet in conformity with GAAP; (iii) notes payable and drafts accepted
representing extensions of credit whether or not representing obligations for
borrowed money; (iv) any obligation owed for all or any part of the deferred
purchase price of property or services (excluding any such obligations incurred
under ERISA), which purchase price is (a) due more than six months from the
date of incurrence of the obligation in respect thereof or (b) evidenced by a
note or similar written instrument; (v) all indebtedness secured by any Lien on
any property or asset owned or held by that Person regardless of whether the
indebtedness secured thereby shall have been assumed by that Person or is
nonrecourse to the credit of that Person; (vi) the face amount of any letter of
credit issued for the account of that Person or as to which that Person is
otherwise liable for reimbursement of drawings; (vii) the direct or indirect
guaranty, endorsement (otherwise than for collection or deposit in the ordinary
course of business), co-making, discounting with recourse or sale with recourse
by such Person of the obligation of another; (viii) any obligation of such
Person the primary purpose or intent of which is to provide assurance to an
obligee that the obligation of the obligor thereof will be paid or discharged,
or any agreement relating thereto will be complied with, or the holders thereof
will be protected (in whole or in part) against loss in respect thereof; and
(ix) any liability of such Person for an obligation of another through any
agreement (contingent or otherwise) (a) to purchase, repurchase or otherwise
acquire such obligation or any security therefor, or to provide funds for the
payment or discharge of such obligation (whether in the form of loans,
advances, stock purchases, capital contributions or otherwise) or (b) to
maintain the solvency or any balance sheet item, level of income or financial
condition of another if, in the case of any agreement described under
subclauses (a) or (b) of this clause (ix), the primary purpose or intent
thereof is as described in clause (viii) above.

 11
 

 

“Indemnitees” shall have the meaning
ascribed to such term in Section 8.3.

“Indemnified Liabilities” shall have the
meaning ascribed to such term in Section 8.3.

“Initial Lenders” shall have the meaning
ascribed to such term in the introduction to this Agreement.

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

“Interest Payment Date” means with respect
to (i) any Base Rate Loan, each March 31, June 30, September 30 and December 31
of each year, commencing on the first such date to occur after the Effective
Date, and the Maturity Date and (ii) any LIBOR Rate Loan, the last day of each
Interest Period therefor and, if any such Interest Period is longer than three
months, the date that is three months after the first day of such Interest
Period, provided that, if any Interest Payment Date would otherwise fall
on a day which is not a Business Day, it shall be postponed to the next day
which is a Business Day.

“Interest Period” shall have the meaning
ascribed to such term in Section 2.5B.

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

“Interest Rate Determination Date” means,
with respect to any Interest Period, the second Business Day prior to the first
day of such Interest Period.

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

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

“Lead Arrangers” shall have the meaning
ascribed to such term in the introduction to this Agreement.

“Lender” and “Lenders” shall mean the Initial Lenders and each Person that
shall become a party hereto pursuant to Section 8.1.

“Leverage Ratio” means, in respect of the
Borrower and its Subsidiaries on a consolidated basis, the ratio of (i)
Consolidated Total Debt as of the last day of any Fiscal Quarter to (ii) Consolidated
Adjusted EBITDA for the four-Fiscal Quarter period then ended.

“LIBOR” means, for any Interest Rate
Determination Date, the offered rate in the London interbank market for
deposits in Dollars offered for a term comparable to such Interest

 12
 

Period that
appears on Telerate Page 3750 as of approximately 11:00 A.M., London time (or
such other page as may replace such page on such service for the purpose of
displaying the rates at which such Dollar deposits are offered by leading banks
in the London interbank deposit market), or if no quotation appears on Telerate
Page 3750, the average rate per annum which the offices of four leading banks
selected by the Administrative Agent and located in London offer for deposits
in Dollars in the London interbank deposit market at approximately 11:00 a.m.
(London time).

“LIBOR Rate Loan” means any Loan bearing
interest at a rate calculated with respect to LIBOR.

“Lien” means any lien, mortgage, pledge,
assignment, security interest, charge or encumbrance of any kind (including any
conditional sale or other title retention agreement, any lease in the nature
thereof, and any agreement to give any security interest) and any option, trust
or other preferential arrangement having the practical effect of any of the
foregoing.

“Loan” means a loan made by a Lender to the
Borrower pursuant to Section 2.1A.

“Loan Documents” means this Agreement, the
Fee Letters and any Note.

“Margin Stock” shall have the meaning
ascribed to such term 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 upon (i) the business, operations, properties or condition
(financial or otherwise) of the Borrower and its Subsidiaries, taken as a
whole, (ii) the ability of the Borrower to perform, or of the Administrative
Agent to enforce, any of the Obligations of the Borrower or (iii) the legality,
validity, binding effect or enforceability against the Borrower of a Loan
Document. For the avoidance of doubt, changes or effects resulting from items
related to Permitted Addbacks shall not be considered in determining whether a
Material Adverse Effect has occurred.

“Maturity Date” means the earlier to occur
of (i) the first anniversary of the Effective Date and (ii) the date of the
acceleration of the Loans pursuant to Section 7.

“Mayne Pharma” means Mayne Pharma Limited
ACN 097 064 330.

“Mayne Pharma Acquisition” means the
acquisition by Hospira Holdings (S.A.) Pty Ltd of all of the stock of Mayne
Pharma substantially on the terms set forth in the Implementation Agreement.

“Moody’s” means Moody’s Investor Services,
Inc. or any successor thereto.

“MSSF” shall have the meaning ascribed to
such term in the introduction to this Agreement.

“Multiemployer Plan” means any Employee
Benefit Plan which is a “multiemployer plan” as defined in Section 3(37) of
ERISA to which the Borrower or any of its ERISA Affiliates is obligated to make
contributions.

 13
 

“Net Cash Proceeds” means, with respect to
any sale, lease, transfer or other disposition of any asset or the incurrence
or issuance of any debt or the sale or issuance of any equity interests
(including any capital contribution) by the Borrower or any of its
Subsidiaries, the aggregate amount of cash received from time to time (whether
as initial consideration or through payment or disposition of deferred
consideration) by or on behalf of such Person in connection with such
transaction after deducting therefrom only (without duplication)
(a) reasonable and customary brokerage commissions, underwriting fees and
discounts, legal and accounting fees, filing fees, finder’s fees and other
similar fees and commissions, (b) the amount of taxes payable in
connection with or as a result of such transaction and (c) the amount of
any debt secured by a Lien on such asset that, by the terms of the agreement or
instrument governing such debt, is required to be repaid upon such disposition,
in each case to the extent, but only to the extent, that the amounts so
deducted are, at the time of receipt of such cash, actually paid to a Person
that is not an Affiliate of the Borrower and are properly attributable to such
transaction or to the asset that is the subject thereof.

“Non-US Lender” shall have the meaning
ascribed to such term in Section 2.8B(iii)(a).

“Note” means a promissory note of the
Borrower payable to the order of any Lender issued pursuant to Section 2.4C, in
substantially in the form of Exhibit III, as amended, supplemented or
otherwise modified from time to time.

“Notice of Borrowing” means a notice
substantially in the form of Exhibit I annexed hereto delivered by the
Borrower to the Administrative Agent pursuant to Section 2.1B with respect to
the proposed borrowing of the Loans.

“Obligations” means all obligations of every
nature of the Borrower from time to time owing to the Agents, the Lead
Arrangers and the Lenders or any of them under the Loan Documents.

“Officer’s Certificate” means, as applied to
any corporation, a certificate executed on behalf of such corporation by any
one of its chairman of the board (if an officer), its president, one of its
vice presidents, its chief financial officer or its treasurer or, as applied to
any limited partnership, a certificate executed on behalf of such limited
partnership by the chairman of the board (if an officer), the president, one of
the vice presidents, the chief financial officer or treasurer of the general
partner of such limited partnership, or, if the general partner of such limited
partnership is an individual, executed by such individual; provided that
every Officer’s Certificate with respect to the compliance with a condition
precedent to the making of any Borrowing shall include:  (i) a statement that the officer making or
giving such Officer’s Certificate has read such condition and any definitions
or other provisions contained in this Agreement relating thereto, (ii) a
statement that, in the opinion of the signer, he has made or has caused to be
made such examination or investigation as is necessary to enable him to express
an informed opinion as to whether or not such condition has been complied with,
and (iii) a statement as to whether, in the opinion of the signer, such
condition has been complied with.

“Organizational Documents” means (i) with
respect to any corporation, its certificate or articles of incorporation or
organization, as amended, and its by laws, as amended,

 14
 

(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 Loan 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.

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

“Pension Plan” means any Employee Benefit
Plan, other than a Multiemployer Plan, which is subject to Section 412 of the
Internal Revenue Code or Section 302 of ERISA and which is intended to be
qualified under Section 401(a) of the Code.

“Performance Level” shall have the meaning
ascribed to such term within the definition of “Applicable Margin”.

“Permitted Acquisition” means an Acquisition
permitted by Section 6.3.

“Permitted Addbacks” means, for any period
ending on or after March 31, 2007, each of the following to the extent taken
into account in determining Consolidated Net Income for such period (all
calculated on a consolidated pre-tax basis): (a) any one-time or special
non-cash charges or expenses resulting from the Mayne Pharma Acquisition,
including charges relating to the write-up of Mayne Pharma’s inventory and the
write-off of in-process research and development; (b) the first $115,000,000 of
charges and expenses (whether cash or non-cash) incurred before December 31,
2008 related to the integration of Mayne Pharma into the Borrower, including
charges and expenses for employee severance or retention, integration of
information systems, plant shutdowns, product relocation and relabeling and
consulting fees); (c) the first $109,000,000 of restructuring charges and
expenses (whether cash or non-cash) incurred after March 31, 2006 and before
December 31, 2008 related to the Borrower’s closure of its Ashland, Ohio,
Donegal, Ireland and Montreal, Canada facilities and exit from its North
Chicago, Illinois facility and related expenses (whether cash or non-cash) for
the relocation of production from such facilities to other facilities; and (d)
the first $24,000,000 of charges and expenses (whether cash or non-cash)
incurred after March 31, 2006 and before December 31, 2006 related to the
Borrower’s separation from Abbott Laboratories, including the establishment of
new facilities, the build-out of independent information technology systems,
and product registration and re-labeling.

“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.

 15
 

 

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

“Prime Rate” means the rate of interest as
announced by the Administrative Agent from time to time as its base rate, as in
effect from time to time. The Prime Rate is a reference rate and does not
necessarily represent the lowest or best rate actually charged to any customer.
The Administrative Agent or any other Lender may make commercial loans or other
loans at rates of interest at, above or below the Prime Rate.

“Pro Rata Share” means, with respect to any
Lender, the percentage obtained by dividing (i) the Credit Exposure of such
Lender by (ii) the aggregate Credit Exposure of all Lenders.

“Proceedings” shall have the meaning
ascribed to such term in Section 5.1(vi).

“Qualified Receivables Transaction” means
any transaction or series of transactions that may be entered into by the
Borrower or any Subsidiary of the Borrower pursuant to which the Borrower or
any such Subsidiary may sell, convey, pledge or otherwise transfer to a
newly-formed Subsidiary of the Borrower or other special purpose entity, or any
other Person, any accounts receivable (including chattel paper, instruments and
general intangibles) or notes receivable and the rights and certain other property
related thereto, provided that (i) all of the terms and conditions of
such transaction or series of transactions, including the amount and type of
any recourse to the Borrower or a Subsidiary of the Borrower with respect to
the assets transferred, are acceptable to the Administrative Agent and the
Requisite Lenders and (ii) the Receivables Transaction Attributed Indebtedness
incurred in all such transactions does not exceed $150,000,000 at any time
outstanding.

“Receivables Transaction Attributable Indebtedness”
means, with respect to any Qualified Receivables Transaction on any date of
determination, the unrecovered purchase price on such date of all assets sold,
conveyed, pledged or otherwise transferred by the Borrower or any wholly-owned
Subsidiary of the Borrower to the third-party conduit entity or other
receivables credit provider under such Qualified Receivables Transaction.

“Register” shall have the meaning ascribed
to such term in Section 2.4A.

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

“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.

“Replacement Lender” shall have the meaning
ascribed to such term in Section 2.11.

 16

“Requisite Lenders” means Lenders having
aggregate Pro Rata Shares of more than 50%.

“Responsible Officer” means the Chief
Executive Officer, the Chief Financial Officer, the Treasurer or the General
Counsel of the Borrower or any other officer of the Borrower responsible for
overseeing or reviewing compliance with the Agreement.

“Restricted Payment” means (i) any
dividend or other distribution, direct or indirect, on account of any shares of
any class of Capital Stock of the Borrower, except a dividend payable solely in
shares of such class of Capital Stock to the holders of such class of Capital
Stock; (ii) any redemption, retirement, sinking fund or similar payment,
purchase or other acquisition for value, direct or indirect, of any shares of
any class of Capital Stock of the Borrower; and (iii) any payment made to
retire, or to obtain the surrender of, any outstanding warrants, options or
other rights to acquire shares of any class of Capital Stock of the Borrower,
except any repurchase or other acquisition of shares of such Capital Stock, or
warrants, options or other rights to acquire such shares, in connection with
employee compensation in the ordinary course of business in accordance with
plans approved by the board of directors of the Borrower.

“S&P” means Standard & Poor’s
Ratings Group, a division of The McGraw Hill Corporation or any successor
thereto.

“Scheme” means the scheme of arrangement
between Mayne Pharma and its shareholders in the form approved by the Court (as
defined in the Implementation Agreement) on the Second Court Date (as defined
in the Implementation Agreement), pursuant to which the Borrower or a
Subsidiary thereof will acquire all of the outstanding ordinary shares of Mayne
Pharma.

“Securities” means any stock, share,
partnership interest, membership interest in a limited liability company,
voting trust certificates, certificate of interest or participation in any
profit-sharing agreement or arrangement, option, warrant, bond, debenture,
note, or other evidence of indebtedness, secured or unsecured, convertible,
subordinated or otherwise, or in general any instruments commonly known as
“securities” or any certificates of interest, shares or participations in
temporary or interim certificates for the purchase or acquisition of, or any
right to subscribe to, purchase or acquire, any of the foregoing.

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

“Significant Subsidiary” means, at any time,
a Subsidiary that has or represents at least 5% of (i) the consolidated gross
revenues of the Borrower and its Subsidiaries for the Fiscal Year then most
recently ended and/or (ii) the consolidated assets of the Borrower and its
Subsidiaries as of the last day of the Fiscal Year then most recently ended.

“Solvent” means, with respect to any Person
on a particular date, that on such date (a) the fair value of the property
of such Person is greater than the total amount of liabilities, including
contingent liabilities, of such Person, (b) the present fair salable value
of the assets of such Person is not less than the amount that will be required
to pay the probable liability of such Person on its debts as they become
absolute and matured, (c) such Person does not intend to, and

 17
 

does not believe
that it will, incur debts or liabilities beyond such Person’s ability to pay
such debts and liabilities as they mature and (d) such Person is not
engaged in business or a transaction, and is not about to engage in business or
a transaction, for which such Person’s property would constitute an
unreasonably small capital.  The amount
of contingent liabilities at any time shall be computed as the amount that, in
the light of all the facts and circumstances existing at such time, represents
the amount that can reasonably be expected to become an actual or matured
liability.

“Subject Transaction” shall have the meaning
ascribed to such term in Section 6.11D.

“Subordinated Indebtedness” means any
Indebtedness of the Borrower or any of its Subsidiaries, subordinated in right
and time of payment to the Obligations.

“Subsidiary” means, with respect to any
Person, any corporation, partnership, limited liability company, association or
other business entity of which more than 50% of the total voting power of
shares of stock or other ownership interests entitled (without regard to the
occurrence of any contingency) to vote in the election of the Person or Persons
(whether directors, managers, trustees or other Persons performing similar
functions) having the power to direct or cause the direction of the management
and policies thereof is at the time owned or controlled, directly or
indirectly, by that Person or one or more of the other Subsidiaries of that
Person or a combination thereof.

“Surviving Obligations” means contingent
indemnification liabilities of the Borrower under the Loan Documents that are
not yet due and payable.

“Syndication Agents” shall have the meaning
ascribed to such term in the introduction to this Agreement.

“Tax” means any present or future tax, levy,
impost, duty, assessment, charge, fee, deduction or withholding of any nature
and whatever called, by whomsoever, on whomsoever and wherever imposed, levied,
collected, withheld or assessed; provided “Tax on the overall net
income” of a Person shall be construed as a reference to a tax imposed by the
jurisdiction in which that Person is organized or in which that Person’s
applicable principal office (and/or, in the case of a Lender, its lending
office) is located or in which that Person (and/or, in the case of a Lender,
its lending office) is deemed to be doing business on all or part of the net
income, profits or gains (whether worldwide, or only insofar as such income,
profits or gains are considered to arise in or to relate to a particular jurisdiction,
or otherwise) of that Person (and/or, in the case of a Lender, its applicable
lending office).

“Term Loans” means the loans to the Borrower
under the $500,000,000 Term Loan Agreement dated January 15, 2007 among the
Borrower, the lenders parties thereto and Citibank, N.A., as administrative
agent for such lenders.

“Terminated Lender” shall have the meaning
ascribed to such term in Section 2.11.

 18
 

“Transaction” means the Mayne Pharma
Acquisition and the debt financings contemplated thereby.

“Type of Loan” means a Base Rate Loan or a
LIBOR Rate Loan.

1.2                               Accounting
Terms; Utilization of GAAP for Purposes of Calculations Under Agreement.

Except
as otherwise expressly provided in this Agreement, all accounting terms not
otherwise defined herein shall have the respective meanings assigned to them in
conformity with GAAP.  Calculations in
connection with the definitions, covenants and other provisions of this
Agreement shall utilize accounting principles and policies in effect on the
date hereof which are in conformity with those used to prepare the financial
statements referred to in Section 4.4. 
Financial statements and other information required to be delivered by
the Borrower to the Administrative Agent pursuant to clauses (i) and (ii) of
Section 5.1 shall be prepared in accordance with GAAP as in effect at the time
of such preparation.  In the event that a
change in GAAP or other accounting principles and policies after the date
hereof affects in any material respect the calculations of the covenants contained
herein, the Lenders and the Borrower agree to negotiate in good faith to amend
the affected covenants (and related definitions) to compensate for the effect
of such changes so that the restrictions, limitations and performance standards
effectively imposed by such covenants, as so amended, are substantially
identical to the restrictions, limitations and performance standards imposed by
such covenants as in effect on the date hereof; provided that, if the
Requisite Lenders and the Borrower fail to reach agreement with respect to such
amendment within a reasonable period of time following the date of
effectiveness of any such change, calculation of compliance by the Borrower and
its Subsidiaries with the covenants contained herein shall be determined in accordance
with GAAP as in effect immediately prior to such change.

1.3                               Other
Definitional Provisions and Rules of Construction.

A.                                    Any of the terms defined herein may, unless
the context otherwise requires, be used in the singular or the plural,
depending on the reference.

B.                                    References to “Sections” and subsections
shall be to Sections and subsections, respectively, of this Agreement unless
otherwise specifically provided.

C.                                    The use in any of the Loan Documents 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 nonlimiting 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.

D.                                    Whenever the term “wholly-owned” is used with
respect to a Subsidiary of a Person, such term means that all of the Capital
Stock (other than directors’ qualifying shares) of such Subsidiary is owned,
directly or indirectly, by such Person.

 19
 

E.                                      For purposes of this Agreement, any reference
to a “Loan” may be (as the context requires) a reference to (i) the single Loan
of Lender made on the Credit Date or purchased in whole or part via an
assignment; or (ii) a portion of a Loan referred to in the preceding clause (i)
that is of a particular Type and, in the case of a LIBOR Loan, has a particular
interest period.

SECTION 2.     AMOUNT AND TERMS OF COMMITMENTS AND LOANS

2.1                               Commitment; Making of Loans.

A.                                    Commitments.

(i)                                     On any Business Day during the period from
the Effective Date through February 7, 2007 (such Business Day, the “Credit Date”), subject to the terms and conditions of
this Agreement and in reliance upon the representations and warranties of the
Borrower herein set forth, each Lender severally agrees to make a Loan in an
amount up to but not exceeding such Lender’s Commitment as set forth opposite
its name on Schedule 2.1A annexed hereto.

(ii)                                  After giving effect to the Loans made on the
Credit Date, each Lender’s Commitment shall expire.  Amounts borrowed pursuant to this Section
2.1A and repaid or prepaid may not be reborrowed.

B.                                    Borrowing Mechanics.

(i)                                     Each Borrowing shall at all times be in
minimum amount of $5,000,000.

(ii)                                  The Borrower shall deliver to Administrative
Agent on behalf of the Lenders a fully executed Notice of Borrowing (a) if any
portion of the Loans initially will consist of LIBOR Rate Loans, not later than
11:00 a.m. (New York City time), at least three (3) Business Days in advance of
the proposed Credit Date; or (b) otherwise, not later than 11:00 a.m. (New York
City time), on the proposed Credit Date. 
Except as otherwise provided herein, the Notice of Borrowing for LIBOR
Rate Loans shall be irrevocable on and after the initial Interest Rate
Determination Date, and the Borrower shall be bound to borrow such Loans in
accordance therewith.  The Notice of
Borrowing shall specify the following information:

(a)                                  the aggregate amount of such Loans;

(b)                                 the Credit Date, which shall be a Business
Day;

(c)                                  whether the Loans initially are to be Base
Rate Loans or LIBOR Rate Loans or a combination thereof; and

(d)                                 the location and number of the Borrower’s
account to which funds are to be disbursed.

(iii)                               Notice of receipt of the Notice of Borrowing,
together with the amount of each Lender’s Pro Rata Share thereof, together with
the applicable interest rate, shall be provided by the Administrative Agent to
each Lender by facsimile with reasonable promptness, but (provided the
Administrative Agent shall have received such notice by 11:00 a.m. (New York
City time)) not later than 2:00 p.m. (New York

 20
 

City
time) on the same day as the Administrative Agent’s receipt of the Notice of
Borrowing from the Borrower.

(iv)                              Each Lender shall make the amount of its Loan
available to the Administrative Agent on the Credit Date by wire transfer not
later than 12:00 p.m. (New York City time) or, if later, not more than one hour
after receipt of the Administrative Agent’s delivery of the notice pursuant to
clause (iii) above, in same day funds in Dollars at the Funding and Payment
Office.

(v)                                 Except as provided herein, upon satisfaction
or waiver of the conditions precedent specified in Section 3.1 and Section 3.2,
the Administrative Agent shall make the proceeds of the Loans available to the
Borrower on the Credit Date by causing an amount of same day funds equal to the
proceeds of all such Loans received by the Administrative Agent from the
Lenders to be credited to the account referred to in Section 2.1B(ii)(d).

2.2                               Repayment.

A.                                    The Loans and all other amounts owed
hereunder with respect to the Loans and the Commitment of each Lender shall be
paid in full on the Maturity Date.

2.3                               Pro
Rata Shares; Availability of Funds.

A.                                    Pro Rata Shares.  The
Loans shall be made by the Lenders simultaneously and proportionately to their
respective Pro Rata Shares (determined as of the Credit Date), it being
understood that no Lender shall be responsible for any default by any other
Lender in such other Lender’s obligation to make its Loan hereunder nor shall any
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 its Loan hereunder.

B.                                    Availability of Funds. 
Unless the Administrative Agent shall have been notified by any Lender
prior to the Credit Date that such Lender does not intend to make available to
the Administrative Agent the amount of such Lender’s Loan requested on the
Credit Date, the Administrative Agent may assume that such Lender has made such
amount available to the Administrative Agent on the Credit Date and the
Administrative Agent may, in its sole discretion, but shall not be obligated
to, make available to the Borrower a corresponding amount on the Credit
Date.  If such corresponding amount is
not in fact made available to the Administrative Agent by such Lender or an
Affiliate of such Lender, the Administrative Agent shall be entitled to recover
such corresponding amount on demand from such Lender together with interest
thereon, for each day from the Credit Date until the date such amount is paid
to the Administrative Agent, at the customary rate set by the Administrative
Agent for the correction of errors among banks for three Business Days and
thereafter at the Base Rate.  If such
Lender does not pay such corresponding amount forthwith upon the Administrative
Agent’s demand therefor, the Administrative Agent shall promptly notify the
Borrower and the Borrower shall immediately pay such corresponding amount to
the Administrative Agent together with interest thereon, for each day from the
Credit Date until the date such amount is paid to the Administrative Agent, at
the rate payable hereunder for Base Rate Loans. 
Nothing in this Section 2.3B shall be deemed to relieve any Lender from
its obligation to fulfill its Commitments

 21
 

hereunder
or to prejudice any rights that the Borrower may have against any Lender as a
result of any default by such Lender hereunder.

2.4                               The
Register; Evidence of Debt; Notes.

A.                                    Register.

(i)                                     The Administrative Agent shall maintain at its
Payment and Funding Office a register for the recordation of the names and
addresses of the Lenders and the Commitment and Loan of each Lender from time
to time (the “Register”). 
The Register shall be available for inspection by the Borrower or any
Lender at any reasonable time and from time to time upon reasonable prior
notice.  The Administrative Agent shall
record in the Register the Commitment and the Loan of each Lender, and each
repayment or prepayment in respect of the principal amount of such Loans.  Any such recordation shall be prima facie
evidence of the amount owed to such Lender hereunder; provided that
failure to make any such recordation, or any error in such recordation, shall
not affect any Lender’s Commitment or the Obligations in respect of any
Loan.  The Borrower hereby designates
Citicorp to serve as the Borrower’ agent solely for purposes of maintaining the
Register as provided in this Section 2.4, and the Borrower hereby agrees that,
to the extent Citicorp serves in such capacity, Citicorp and its officers,
directors, employees, agents and affiliates shall constitute “Indemnitees”
hereunder.

(ii)                                  The Borrower, the Administrative Agent and
the Lenders shall deem and treat the Persons listed as Lenders in the Register
as the holders and owners of the corresponding Commitments and Loans listed
therein for all purposes hereof, and no assignment or transfer of any
Commitment or Loan shall be effective, in each case unless and until an
Assignment Agreement effecting the assignment or transfer thereof shall have
been accepted by the Administrative Agent and recorded in the Register as
provided in Section 8.1C.  Prior to such
recordation, all amounts owed with respect to the applicable Commitment or 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 Commitments or Loans.

B.                                    Lenders’ Evidence of Debt.  Each
Lender shall maintain on its internal records an account or accounts evidencing
the Obligations of the Borrower to such Lender, including the amounts of the
Loans made by it and each repayment and prepayment in respect thereof.  Any such recordation shall be conclusive and
binding on the 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 Commitments or the Obligations of the Borrower in
respect of any applicable 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.

C.                                    Notes.  If so
requested by any Lender by written notice to the Borrower (with a copy to the
Administrative Agent), the Borrower shall execute and deliver to such Lender,
promptly after the Borrower’s receipt of such notice, a Note or Notes to
evidence such Lender’s Loans.

 22
 

2.5                               Interest
on the Loans.

A.                                    Rate of Interest; Type of Loan.

(i)                                     Subject to the provisions of Sections 2.5E,
2.8 and 2.9, each Loan shall bear interest on the unpaid principal amount
thereof from the date made through the Maturity Date (whether by acceleration
or otherwise) at a rate equal to (a) at all times such Loan is a Base Rate
Loan, the Base Rate plus the Applicable Margin or (b) at all times such
Loan is a LIBOR Rate Loan, the sum of LIBOR plus the Applicable Margin.

(ii)                                  The basis for determining the rate of
interest with respect to any Loan, and the Interest Period with respect to any
LIBOR Rate Loan, shall be selected by the Borrower and notified to the
Administrative Agent and the Lenders pursuant to the Notice of Borrowing or a
Conversion/Continuation Notice, as the case may be.

(iii)                               As soon as practicable after 11:00 a.m. (New
York City time) on each Interest Rate Determination Date, the Administrative
Agent shall determine (which determination shall, absent manifest error, be
final, conclusive and binding upon all parties) the interest rate that shall
apply to the LIBOR Rate Loans for which an interest rate is then being
determined for the applicable Interest Period and shall promptly give notice
thereof (in writing or by telephone confirmed in writing) to the Borrower and
each Lender.

B.                                    Interest Periods.  The
applicable interest period (each an “Interest Period”) of
each Borrowing of LIBOR Rate Loans shall be a one (1), two (2), three (3) or
six (6) month period, as selected by the Borrower in the applicable Notice of
Borrowing or Conversion/Continuation Notice, initially commencing on the date
of the Loan or any Conversion/Continuation Date, as the case may be; provided
that

(i)                                     in the case of immediately successive
Interest Periods applicable to LIBOR Rate Loans, each successive Interest
Period shall commence on the day on which the immediately preceding Interest
Period expires;

(ii)                                  if an Interest Period would otherwise expire
on a day that is not a Business Day, such Interest Period shall expire on the
next succeeding Business Day; provided that, if any Interest Period
would otherwise expire on a day that is not a Business Day but is a day of the
month after which no further Business Day occurs in such month, such Interest
Period shall expire on the immediately preceding Business Day;

(iii)                               any Interest Period that begins on the last
Business Day of a calendar month (or on a day for which there is no numerically
corresponding day in the calendar month at the end of such Interest Period)
shall, subject to clause (iv) of this Section 2.5B, end on the last Business
Day of a calendar month;

(iv)                              no Interest Period shall extend beyond the
Maturity Date;

(v)                                 no more than ten (10) Interest Periods shall
be outstanding at any time;

 23
 

(vi)                              subject to clause (vii) of this Section 2.5B,
if the Borrower fails to specify an Interest Period for any Borrowing of LIBOR
Rate Loans in the applicable Conversion/Continuation Notice or fails to give
timely notice of the continuation of any outstanding Borrowing of LIBOR Rate
Loans, the Borrower shall be deemed to have selected an Interest Period of one
(1) month; and

(vii)                           until the earlier of (x) the date that is 30
days after the Effective Date and (y) the date that the Lead Arrangers notify
the Borrower that the primary syndication of the Loans has been completed, all
LIBOR Rate Loans shall have an Interest Period of one (1) week, if one week
Interest Periods are available from all Lenders or, if one week Interest
Periods are not available from all Lenders, all Loans shall be Base Rate Loans
during such period.

C.                                    Interest Payments.  On
each Interest Payment Date for a Loan, the Borrower shall pay an amount equal
to the aggregate amount of interest that has accrued on such Loan since the
Effective Date or the last Interest Payment Date for such Loan, as
applicable.  In addition, interest on
each Loan shall be payable upon any prepayment of such Loan (to the extent
accrued on the amount being prepaid) and at maturity.

D.                                    Default Rate. Upon
the occurrence and during the continuation of any Event of Default, (i) the
Borrower shall no longer have the option to continue or convert into LIBOR Rate
Loans, (ii) each LIBOR Rate Loan shall convert to a Base Rate Loan at the end
of the Interest Period then in effect for such LIBOR Rate Loan, (iii) upon
request of the Requisite Lenders, the outstanding principal amounts of all
LIBOR Rate Loans shall bear interest (including post-petition interest in any
case or proceeding under the Bankruptcy Code) at a rate per annum equal to two
percent (2%) plus the rate then applicable to LIBOR Rate Loans until the end of
the applicable Interest Period and thereafter at a rate equal to two percent
(2%) plus the rate then applicable to Base Rate Loans, and (iv) upon request of
the Requisite Lenders, all outstanding Base Rate Loans and, to the extent
permitted by applicable law, other Obligations arising hereunder or under any
other Loan Document shall bear interest (including post-petition interest in
any case or proceeding under the Bankruptcy Code) at a rate per annum equal to
two percent (2%) plus the rate then applicable to such Base Rate Loans or such
other Obligations arising hereunder or under any other Loan Document.  Upon the occurrence and during the continuation
of any Potential Event of Default under Section 7.13, (i) the outstanding
principal amounts of all LIBOR Rate Loans shall bear interest (including
post-petition interest in any case or proceeding under the Bankruptcy Code) at
a rate per annum equal to two percent (2%) plus the rate then applicable to
LIBOR Rate Loans until the end of the applicable Interest Period and thereafter
at a rate equal to two percent (2%) plus the rate then applicable to Base Rate
Loans, and (ii) all outstanding Base Rate Loans and, to the extent permitted by
applicable law, other Obligations arising hereunder or under any other Loan
Document shall bear interest (including post-petition interest in any case or
proceeding under the Bankruptcy Code) at a rate per annum equal to two percent
(2%) plus the rate then applicable to such Base Rate Loans or such other
Obligations arising hereunder or under any other Loan Document.  Payment or acceptance of the increased rates
of interest provided for in this Section 2.5D is not a permitted alternative to
timely payment and shall not constitute a waiver of any Event of Default or
Potential Event of Default or otherwise prejudice or limit any rights or
remedies of Agents or Lenders.

 24
 

E.                                      Computation of Interest.  Interest payable pursuant to Section 2.5A shall be computed (i) in the
case of Base Rate Loans, on the basis of a 365 day or 366 day year, as the case
may be, and (ii) in the case of LIBOR Rate Loans, on the basis of a 360 day
year, in each case for the actual number of days elapsed in the period during
which it accrues.  In computing interest
on any Loan, the date of the making of such Loan or the first day of an
Interest Period applicable to such Loan or, with respect to a Base Rate Loan being
converted from a LIBOR Rate Loan, the date of conversion of such LIBOR Rate
Loan to such Base Rate Loan, as the case may be, shall be included, and the
date of payment of such Loan or the expiration date of an Interest Period
applicable to such Loan or, with respect to a Base Rate Loan being converted to
a LIBOR Rate Loan, the date of conversion of such Base Rate Loan to such LIBOR
Rate Loan, as the case may be, shall be excluded; provided, if a Loan is
repaid on the same day on which it is made, one day’s interest shall be paid on
that Loan.

F.                                      Conversion/Continuation.

(i)                                     Subject to Section 2.9 and so long as no
Potential Event of Default or Event of Default shall have occurred and then be
continuing, the Borrower shall have the option:

(a)                                  to convert at any time all or any part of any
Borrowing in an aggregate amount of $5,000,000 or a higher integral multiple of
$1,000,000 from one Type of Loan to another Type of Loan; provided if
any LIBOR Rate Loan is converted on a day other than the last day of an
Interest Period therefor, the Borrower shall pay all amounts due under Section
2.8 in connection with such conversion; or

(b)                                 upon the expiration of any Interest Period
applicable to any Borrowing LIBOR Rate Loans, to continue all or any portion of
such Borrowing for a new Interest Period in a minimum amount of $5,000,000.

(ii)                                  The Borrower shall deliver a
Conversion/Continuation Notice to the Administrative Agent no later than 11:00
a.m. (New York City time) at least one Business Day in advance of the proposed
conversion date (in the case of a conversion to Base Rate Loans) and at least
three Business Days in advance of the proposed Conversion/Continuation Date (in
the case of a conversion to, or a continuation of, LIBOR Rate Loans).  Except as otherwise provided herein, a
Conversion/Continuation Notice for conversion to, or continuation of, LIBOR
Rate Loans (or telephonic notice in lieu thereof) shall be irrevocable on and
after the related Interest Rate Determination Date, and the Borrower shall be
bound to effect a conversion or continuation in accordance therewith.

G.                                    Additional Interest on LIBOR Rate
Loans.  The Borrower shall pay to each Lender, so
long as and to the extent such Lender shall be required under regulations of
the Board of Governors of the Federal Reserve System to maintain reserves with
respect to liabilities or assets consisting of or including “Eurocurrency
liabilities” (as such term is defined in Regulation D), additional interest on
the unpaid principal amount of each LIBOR Rate Loan of such Lender, from the
date of such Loan until such principal amount is paid in full, at an interest
rate per annum equal at all times to the remainder obtained by subtracting (a)
the LIBOR rate for the applicable Interest Period for such Loan from (b) the
rate obtained by dividing such LIBOR rate by a percentage equal to 100% minus
the Applicable Reserve Requirement (expressed as a

 25
 

percentage)
of such Lender for such Interest Period, payable on each date on which interest
is payable on such Loan.  Such Lender
shall as soon as practicable provide notice to the Administrative Agent and the
Borrower of any such additional interest arising in connection with such Loan,
which notice shall be conclusive and binding, absent demonstrable error.

2.6                               Fees.

(i)                                     Commitment
Fee:  The Borrower agrees to pay to
each Lender, for the period from the Effective Date until the Credit Date, a
commitment fee (the “Commitment Fee”)
on such Lender’s then current unused Commitment, determined by reference to the
pricing grid set forth in the definition of Applicable Margin.  The Commitment Fee shall be paid quarterly in
arrears and on the Credit Date or the date of the termination of the
Commitments to the Administrative Agent at its Funding and Payment Office and
upon receipt, the Administrative Agent shall promptly distribute to each Lender
its Pro Rata Share thereof.  The
Commitment Fee shall be calculated on the basis of a 360 day year and the
actual number of days elapsed.

(ii)                                  Lead
Arrangers’ Fees.  In addition to the
foregoing fees, the Borrower agrees to pay to the Lead Arrangers and the Agents
such other fees in the amounts and at the times separately agreed upon in the
Fee Letters.

2.7                               Provisions
Regarding Payments.

A.                                    Voluntary Prepayments.

(i)                                     Any time and from time to time:

(a)                                  the Borrower may prepay any Borrowing of Base
Rate Loans on any Business Day in whole or in part, in an aggregate principal
amount of $5,000,000 or a higher integral multiple of $1,000,000; and

(b)                                 the Borrower may prepay any Borrowing of
LIBOR Rate Loans on any Business Day in whole or in part in an aggregate
principal amount of $5,000,000.

(ii)                                  All prepayments shall be made upon prior
written or telephonic notice received by the Administrative Agent not later
than 11:00 a.m. (New York City time):

(a)                                  In
the case of Base Rate Loans, on the date of such prepayment; and

(b)                                 In
the case of LIBOR Rate Loans, two (2) Business Days’ prior to the date of such
prepayment;

and, if such
notice is given by telephone, such notice shall be promptly confirmed in
writing to the Administrative Agent (and the Administrative Agent will promptly
transmit such telephonic or original notice for the Loans by facsimile or
telephone to each Lender).  Upon the
giving of any such notice, the principal amount of the Loans specified in such
notice shall become due and payable on the prepayment date specified therein.

 26
 

B.                                    Voluntary Commitment Reductions.

(i)                                     The Borrower may, upon not less than three
(3) Business Days’ prior written or telephonic notice confirmed in writing to
the Administrative Agent (which original written or telephonic notice the
Administrative Agent will promptly transmit by facsimile or telephone to each
Lender), at any time and from time to time terminate in whole or permanently
reduce in part, without premium or penalty, the unused Commitments; provided
any such partial reduction of the Commitments shall be in the amount of
$5,000,000 or a higher integral multiple of $1,000,000.

(ii)                                  The Borrower’ notice to the Administrative
Agent shall designate the date (which shall be a Business Day) of such
termination or reduction and the amount of any partial reduction, and such
termination or reduction of the Commitments shall be effective on the date
specified in the Borrower’s notice and shall reduce the Commitment of each
Lender proportionately to its Pro Rata Share thereof.

C.                                    Mandatory Prepayments.

(i)                                     The Borrower shall, on the date and in the
amount of the receipt by the Borrower or any of its Subsidiaries as to which
the transfer of funds to the Borrower would not result in adverse tax
consequences of Net Cash Proceeds from (a) the incurrence or issuance of debt
(including pursuant to a public offering, a private placement or a syndicated
bank financing (other than borrowings under the Borrower’s Credit Agreement
dated as of December 16, 2005 with the lenders parties thereto and CNAI, as
administrative agent, that not used directly or indirectly to finance the Mayne
Pharma Acquisition) or (b) the issuance of equity or equity-linked transactions
in the capital markets, repay the Loans in an aggregate amount equal to the
amount of such Net Cash Proceeds.

(ii)                                  If the Term Loans have been, or substantially
contemporaneously with the receipt of Net Cash Proceeds as described in this
paragraph (ii) will be, repaid or prepaid in full, the Borrower shall, on the
date and in the amount of the receipt by the Borrower or any of its
Subsidiaries of Net Cash Proceeds from any Asset Sale (other than the Net Cash
Proceeds of the Divestiture in an amount not to exceed $12,000,000 and other
than to the extent that (x) the Net Cash Proceeds of such Asset Sale are less
than $1,000,000 for any single transaction or series of related transactions or
(y) the Net Cash Proceeds of all Asset Sales after the date hereof are less
than $30,000,000 in the aggregate), repay the Loans in an aggregate amount
equal to the amount of such Net Cash Proceeds that are not used by the Borrower
to prepay the Term Loans (rounded downward to the nearest $5,000,000 increment,
with such rounded amount applied in accordance with the proviso to this Section
2.7.C.(ii)); provided, that, if the Borrower has previously made
a mandatory prepayment of Loans in accordance with this Section 2.7.C.(ii), no
further mandatory prepayment shall be required until the amount of Net Cash
Proceeds of the nature described above again exceed $5,000,000.

 27
 

D.                                    Application of
Prepayments/Reductions.  Unless otherwise specified by the Borrower in
a notice of prepayment,

(a) any amount to be
applied pursuant to Section 2.7A or C shall be applied to prepay Loans to the
full extent thereof.

(b) considering each Type
of Loan being prepaid separately, any prepayment thereof shall be applied first
to Base Rate Loans to the full extent thereof before application to LIBOR Rate
Loans, in each case in a manner which minimizes the amount of any payments
required to be made by the Borrower pursuant to Section 2.9C.

E.                                      General Provisions Regarding
Payments.

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

(ii)                                  Payments on Business Days. 
Subject to the provisions of Section 2.5B with respect to Interest
Periods, 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.

(iii)                               Application of Payments to Principal and
Interest.  All payments in respect of the principal
amount of the Loans shall include payment of accrued interest on the principal
amount being repaid or prepaid, and all such payments shall be applied to the
payment of interest before application to principal.

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

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

(vi)                              Authorization to Charge Accounts.  The
Borrower hereby authorizes the Administrative Agent to charge the Borrower’s
accounts with the Administrative Agent in order to cause timely payment to be
made to the Administrative Agent of all principal, interest, fees and expenses
due hereunder (subject to sufficient funds being available in its accounts for
that purpose).

 28
 

(vii)                           Non-Conforming Payments.  The
Administrative Agent shall 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 shall not be deemed to have been received by the
Administrative Agent until the later of (i) the time such funds become
available funds, and (ii) the applicable next Business Day.  The Administrative Agent shall give prompt
telephonic notice to the Borrower and each Lender (confirmed in writing) if any
payment is non-conforming.  Any
non-conforming payment may constitute or become a Potential Event of Default or
Event of Default in accordance with the terms of Section 7.1.  Interest shall continue to accrue on any
principal as to which a non-conforming payment is made until such funds become
available funds (but in no event less than the period from the date of such
payment to the next succeeding applicable Business Day) at the rate determined
pursuant to Section 2.5D from the date such amount was due and payable until
the date such amount is paid in full.

2.8                               Increased
Costs; Taxes.

A.                                    Compensation for Increased Costs
and Taxes.  Subject to the provisions of Section 2.8B
(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 law, treaty or governmental rule, regulation or order, or any change
therein or in the interpretation, administration or application thereof
(including the introduction of any new law, treaty or governmental rule,
regulation or order), or any determination of a court or Governmental
Authority, in each case that becomes effective after the date hereof, or
compliance by such Lender with any guideline, request or directive issued or
made after the date hereof by any 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 Tax on the overall net income of
such Lender) with respect to this Agreement or any of the other Loan 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, Federal Deposit Insurance
Corporation insurance or similar requirement against assets held by, or
deposits or other liabilities in or for the account of, or advances or loans
by, or other credit extended by, or any other acquisition of funds by, any office
of such Lender (other than any such reserve or other requirements with respect
to LIBOR Rate Loans that are reflected in the definition of LIBOR); 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 or the London interbank market;

and the result of
any of the foregoing is to increase the cost to such Lender of agreeing to
make, making or maintaining Loans hereunder or to reduce any amount received or
receivable by such

 29
 

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 the Borrower (with a copy to the
Administrative Agent) a written statement, setting forth in reasonable detail
the basis for, and a calculation in reasonable detail of, the additional amounts
owed to such Lender under this Section 2.8A, which statement shall be
conclusive and binding upon all parties hereto absent manifest error.

B.                                    Withholding of Taxes.

(i)                                     Payments to Be Free and Clear.  All
sums payable by the Borrower under this Agreement and the other Loan 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 (other than a Tax
on the overall net income of any Lender) imposed, levied, collected, withheld
or assessed by or within the United States of America or any political
subdivision in or of the United States of America or any other jurisdiction
from or to which a payment is made by or on behalf of the Borrower or by any
federation or organization of which the United States of America or any such
jurisdiction is a member at the time of payment.

(ii)                                  Grossing-up of Payments.  If
the Borrower or any other Person is required by law to make any deduction or
withholding on account of any such Tax from any sum paid or payable by the
Borrower to the Administrative Agent or any Lender under any of the Loan
Documents:

(a)                                  the Borrower shall notify the Administrative
Agent of any such requirement or any change in any such requirement as soon as
the Borrower becomes aware of it;

(b)                                 the Borrower shall pay any such Tax before
the date on which penalties attach thereto, such payment to be made (if the
liability to pay is imposed on the Borrower) for its own account or (if that
liability is imposed on the Administrative Agent or such Lender, as the case
may be) on behalf of and in the name of the Administrative Agent or such
Lender;

(c)                                  the sum payable by the Borrower in respect of
which the relevant deduction, withholding or payment is required shall be
increased to the extent necessary to ensure that, after the making of that
deduction, withholding or payment, the Administrative Agent or such Lender, as
the case may be, receives on the due date and retains a net sum equal to what
it would have received and retained had no such deduction, withholding or
payment been required or made; and

(d)                                 within thirty (30) days after paying any sum
from which it is required by law to make any deduction or withholding, and
within thirty (30) days after the due date of payment of any Tax which it is
required by clause (b) above to pay, the Borrower shall deliver to the
Administrative Agent evidence reasonably satisfactory to the other affected
parties

 30
 

of such deduction, withholding or payment and
of the remittance thereof to the relevant taxing or other authority.

(iii)                               Evidence of Exemption from U.S. Withholding
Tax.

(a)                                  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-US Lender”)
shall deliver to the Administrative Agent for transmission to the Borrower, on
or prior to the Effective Date (in the case of each Lender listed on the
signature pages hereof on the Effective 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 the Borrower or Administrative Agent (each in the reasonable exercise of its
discretion), (x) two original copies of Internal Revenue Service Form W-8BEN or
W-8ECI (or any successor forms), properly completed and duly executed by such
Lender, and such other documentation required under the Internal Revenue Code
or reasonably requested by the 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 Loan Documents.

(b)                                 Each Lender required to deliver any forms,
certificates or other evidence with respect to United States federal income tax
withholding matters pursuant to Section 2.8B(iii)(a) 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 (1) deliver to Administrative
Agent for transmission to the Borrower two new original copies of Internal
Revenue Service Form W-8BEN or W-8ECI, or a Certificate re Non-Bank Status and
two (2) original copies of Internal Revenue Service Form W-8BEN (or any
successor form), as the case may be, properly completed and duly executed by
such Lender, and such other documentation required under the Internal Revenue
Code and reasonably requested by the 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 Loan Documents or
(2) notify Administrative Agent and the Borrower of its inability to deliver
any such forms, certificates or other evidence.

(c)                                  The Borrower shall not be required to pay any
additional amount to any Non-US Lender under clause (c) of Section 2.8B(ii) if
such Lender shall have failed to satisfy the requirements of clause (a) or
(b)(1) of this Section 2.8B(iii); provided that if such Lender shall
have satisfied the requirements of Section 2.8B(iii)(a) on the Effective Date
or on the date of the Assignment Agreement pursuant to which it became a
Lender, as applicable, nothing in this Section 2.8B(iii)(c) shall relieve the
Borrower of its obligation to pay any additional amounts pursuant to clause (c)
of Section 2.8B(ii) in the event that, as a result of any change in any
applicable law, treaty or governmental rule, regulation or order, or any change
in the interpretation, administration or application thereof, such Lender is no
longer properly entitled to deliver forms, certificates or other evidence at a
subsequent date establishing the fact that such Lender is not subject to
withholding as described herein.

 31
 

(iv)                              If a payment is made by the Borrower under
the foregoing provisions of this Section 2.8(B) for the account of any Lender
and such Lender, in its sole opinion, determines that it has irrevocably
received or been granted a credit against, or relief or remission from, or
repayment or refund of, any tax paid or payable by it in respect of or
calculated with reference to the deduction or withholding giving rise to such
additional payment, such Lender shall, to the extent that it determines that it
can do so without prejudice to the retention of the amount of such credit,
relief, remission or repayment, pay to the Borrower such amount as such Lender
shall, in its sole opinion, have determined is attributable to such deduction
or withholding and will leave such Lender (after such payment) in no worse
position than it would have been had the Borrower not been required to make
such deduction or withholding.  Nothing
contained herein shall (i) interfere with the right of a Lender to arrange its
tax affairs in whatever manner it thinks fit, (ii) oblige any Lender to
disclose any information relating to its tax affairs or any computations in
respect thereof or (iii) require any Lender to take or refrain from taking any
action that would prejudice its ability to benefit from any other credit,
relief, remission, repayment or refund to which it may be entitled.

C.                                    Capital Adequacy Adjustment.  In
the event that any Lender shall have determined that the adoption,
effectiveness, phase-in or applicability after the Effective Date of any law,
rule or regulation (or any provision thereof) regarding capital adequacy, or
any change therein after the Effective Date or in the interpretation or
administration thereof by any Governmental Authority, central bank or
comparable agency charged with the interpretation or administration thereof, or
compliance by such 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 issued after the Effective Date, has or would have the effect
of reducing the rate of return on the capital of such Lender or any corporation
controlling such Lender as a consequence of, or with reference to, such
Lender’s Loans or Commitment, or participations therein or other obligations
hereunder with respect to the 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, 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 the Borrower
(with a copy to the Administrative Agent) a written statement, setting forth in
reasonable detail the basis for, and calculation in reasonable detail of, the
additional amounts owed to the Lender under this Section 2.8C, which statement
shall be conclusive and binding upon all parties hereto absent manifest error.

2.9                               Special
Provisions Governing LIBOR Rate Loans.

Notwithstanding
any other provision of this Agreement to the contrary, the following provisions
shall govern with respect to LIBOR Rate Loans as to the matters covered:

A.                                    Inability to Determine Applicable
Interest Rate.  In the event that the Administrative Agent
shall have determined (which determination shall be final and conclusive and
binding upon all parties hereto), on any Interest Rate Determination Date with
respect to any Borrowing of LIBOR Rate Loans, that by reason of circumstances
affecting the interbank

 32
 

LIBOR
market adequate and fair means do not exist for ascertaining the interest rate
applicable to such Loans on the basis provided for in the definition of LIBOR
Rate, the Administrative Agent shall on such date give notice (by facsimile or
by telephone confirmed in writing) to the Borrower and each Lender of such
determination, whereupon (i) no Loans may be made as, or converted to, LIBOR
Rate Loans until such time as the Administrative Agent notifies the Borrower
and the Lenders that the circumstances giving rise to such notice no longer
exist, and (ii) any Notice of Borrowing or Conversion/Continuation Notice given
by the Borrower with respect to the Loans in respect of which such
determination was made shall be deemed to be rescinded by the Borrower.

B.                                    Illegality or Impracticability of
LIBOR Rate Loans.  In the event that on any date any Lender
shall have determined (which determination shall be final and conclusive and
binding upon all parties hereto but shall be made only after consultation with
the Borrower and the Administrative Agent) that the making, maintaining or
continuation of its LIBOR Rate Loans (i) has become unlawful as a result of
compliance by such Lender in good faith with any law, treaty, governmental
rule, regulation, guideline or order (or would conflict with any such treaty,
governmental rule, regulation, guideline or order not having the force of law
even though the failure to comply therewith would not be unlawful) or (ii) has
become impracticable, or would cause such Lender material hardship, as a result
of contingencies occurring after the date of this Agreement which materially
and adversely affect the interbank LIBOR market or the position of such Lender
in that market, then, and in any such event, such Lender shall be an “Affected Lender” and it shall on that day give notice (by
facsimile or by telephone confirmed in writing) to the Borrower and the
Administrative Agent of such determination (which notice the Administrative
Agent shall promptly transmit to each other Lender).  Thereafter (a) such LIBOR Rate Loan
shall be Converted into a Base Rate Loan and (b) the obligation of the
Lenders to make LIBOR Rate Loans or to Convert Loans into LIBOR Rate Loans
shall be suspended until the Administrative Agent shall notify the Borrower and
the Lenders that the circumstances causing such suspension no longer exist.

C.                                    Compensation For Breakage.  The
Borrower shall compensate each Lender upon written request by such Lender
(which request shall set forth the basis for requesting such amounts and a
calculation thereof in reasonable detail) for all reasonable losses, expenses
and liabilities (including any interest paid by such Lender to lenders of funds
borrowed by it to make or carry its LIBOR Rate Loans and any loss, expense or
liability sustained by such Lender in connection with the liquidation or
re-employment of such funds, but excluding lost profits) which that Lender may
sustain:  (i) if for any reason (other
than a default by such Lender) a LIBOR Rate Loan is not made on a date
specified therefor in a Notice of Borrowing or a telephonic request for
borrowing, or a conversion to or continuation of any LIBOR Rate Loan does not
occur on a date specified therefor in a Conversion/Continuation Notice or a
telephonic request for conversion or continuation, (ii) if any prepayment or
other principal payment of, or any conversion of, any of its LIBOR Rate Loans
occurs on a date other than the last day of an Interest Period applicable to
such LIBOR Rate Loan or (iii) if any prepayment of any LIBOR Rate Loan made by
such Lender is not made on any date specified in a notice of prepayment given
by the Borrower.

 33

D.                                    Booking of LIBOR Rate Loans.  Any
Lender may make, carry or transfer LIBOR Rate Loans at, to, or for the account
of any of its branch offices or the office of an Affiliate of that Lender.

E.                                      Assumptions Concerning Funding of
LIBOR Rate Loans.  Calculation of all amounts payable to a
Lender under this Section 2.9 and under Section 2.8A shall be made as though
that Lender had actually funded each of its relevant LIBOR Rate Loans through
the purchase of a LIBOR deposit bearing interest at the rate obtained pursuant
to the definition of LIBOR in an amount equal to the amount of such LIBOR Rate
Loan and having a maturity comparable to the relevant Interest Period and
through the transfer of such LIBOR deposit from an offshore office of that
Lender to a domestic office of that Lender in the United States of America; provided,
however, that each Lender may fund each of its LIBOR Rate Loans in any
manner it sees fit and the foregoing assumptions shall be utilized only for the
purposes of calculating amounts payable under this Section 2.9 and under
Section 2.8A and 2.8C.

2.10                        Defaulting
Lenders.

Anything
contained herein to the contrary notwithstanding, in the event that any Lender
defaults (a “Defaulting Lender”)
in its obligation to fund (a “Funding Default”)
its Loan (a “Defaulted Loan”),
then (a) during the Default Period with respect to such Defaulting Lender, such
Defaulting Lender shall be deemed not to be a “Lender” for purposes of voting
on any matters (including the granting of any consents or waivers) with respect
to any of the Loan Documents; (b) to the extent permitted by Applicable Law,
until such time as the Default Excess with respect to such Defaulting Lender
shall have been reduced to zero, (i) any voluntary prepayment of the Loans
shall, if the Borrower so directs at the time of making such voluntary
prepayment, be applied to the Loans of other Lenders as if such Defaulting
Lender had no Loan outstanding, and (ii) any mandatory prepayment of the Loans
shall, if the Borrower so directs at the time of making such mandatory
prepayment, be applied to the Loans of other Lenders (but not to the Loans of
such Defaulting Lender) as if such Defaulting Lender had funded the Defaulted
Loan of such Defaulting Lender, it being understood and agreed that the Borrower
shall be entitled to retain any portion of any mandatory prepayment of the
Loans that is not paid to such Defaulting Lender solely as a result of the
operation of the provisions of this clause (b); and (c) the aggregate principal
amount of all outstanding Loans as at any date of determination shall be
calculated as if such Defaulting Lender had funded the Defaulted Loan of such
Defaulting Lender.  No Commitment of any
Lender shall be increased or otherwise affected, and, except as otherwise
expressly provided in this Section 2.10, performance by the Borrower of its
Obligations shall not be excused or otherwise modified as a result of any
Funding Default or the operation of this Section 2.10.  The rights and remedies against a Defaulting
Lender under this Section 2.10 are in addition to other rights and remedies
which the Borrower may have against such Defaulting Lender with respect to any
Funding Default and which the Administrative Agent or any Lender may have
against such Defaulting Lender with respect to any Funding Default.

2.11                        Removal
or Replacement of a Lender.

Anything
contained herein to the contrary notwithstanding, in the event that any Lender
shall give notice to the Borrower that such Lender is an Affected Lender or
that such Lender is entitled to receive payments under Section 2.8 or 2.9, if
the circumstances which have caused

 34
 

such Lender to be
an Affected Lender or which entitle such Lender to receive such payments shall
remain in effect, and such Lender shall fail to withdraw such notice within
five (5) Business Days after receipt by such Lender of a written request for
such withdrawal from the Borrower; then, with respect to each such Lender (the
“Terminated Lender”), the Borrower
may, by giving written notice to the Administrative Agent and any Terminated
Lender of its election to do so, elect to cause such Terminated Lender (and
such Terminated Lender hereby irrevocably agrees) to assign its outstanding
Loan in full to one or more Eligible Assignees (each a “Replacement Lender”) in accordance with the
provisions of Section 8.1 for a purchase price equal to the outstanding
principal amount of the Loan assigned and accrued interest thereon through the
date of assignment, to be paid by the Replacement Lender; provided that
concurrently with such assignment, the Borrower shall pay any amounts payable
to such Terminated Lender to the date of such assignment pursuant to Sections
2.8 or 2.9 or otherwise as if it were a prepayment.  Upon the completion of such assignment and
the prepayment of all amounts owing to any Terminated Lender, such Terminated
Lender shall no longer constitute a “Lender” for purposes hereof; provided
that any rights of such Terminated Lender to indemnification hereunder shall
survive as to such Terminated Lender.

2.12                        Mitigation.

A.                                    Each Lender agrees that, as promptly as
practicable after the officer of such Lender responsible for administering the
Loan of such Lender becomes aware of the occurrence of an event or the
existence of a condition that would cause such Lender to become an Affected
Lender or that would entitle such Lender to receive payments under Section 2.8
or 2.9, it will, to the extent not inconsistent with the internal policies of
such Lender and any applicable legal or regulatory restrictions, use reasonable
efforts (i) to make, issue, fund or maintain the Commitment of such Lender or
the Loan of such Lender through another lending office of such Lender, or (ii)
take such other measures as such Lender may deem reasonable, if as a result
thereof the circumstances which would cause such Lender to be an Affected
Lender would cease to exist or the additional amounts which would otherwise be
required to be paid to such Lender pursuant to Section 2.8 or 2.9 would be
materially reduced and if, as determined by such Lender in its sole discretion,
the making, issuing, funding or maintaining of such Commitment or Loan through
such other lending office or in accordance with such other measures, as the
case may be, would not otherwise adversely affect such Commitment or Loan or
the interests of such Lender; provided that such Lender will not be
obligated to utilize such other lending office pursuant to this Section 2.12
unless the Borrower agrees to pay all incremental expenses incurred by such
Lender as a result of utilizing such other lending office as described in
clause (i) above.  A certificate as to
the amount of any such expenses payable by the Borrower pursuant to this
Section 2.12 (setting forth in reasonable detail the basis for requesting such
amount and a calculation thereof in reasonable detail) submitted by such Lender
to the Borrower (with a copy to the Administrative Agent) shall be conclusive
absent manifest error.

B.                                    Notwithstanding the provisions of Section
2.8, if any Lender fails to notify the Borrower of any event or circumstance
which will entitle such Lender to compensation pursuant to Section 2.8 within
365 days after such Lender obtains knowledge of such event or circumstance,
then such Lender shall not be entitled to compensation from the Borrower for any
amount arising prior to the date which is 365 days before the date on which
such Lender notifies the Borrower of such event or circumstance.

 35
 

SECTION 3.     CONDITIONS PRECEDENT

3.1                               Conditions
to Effectiveness.

The
effectiveness of this Agreement is subject to the satisfaction of the following
conditions:

A.                                    Credit and Organizational
Documents.  The Borrower shall deliver or cause to be
delivered to the Administrative Agent on behalf of each Lender the following:

(i)                                     sufficient copies of this Agreement originally
executed and delivered by the Borrower for each Lender;

(ii)                                  copies of the Organizational Documents, dated
a recent date prior to the Effective Date, certified as of the Effective Date
(or a recent date prior to the Effective Date) by the appropriate governmental
official or the secretary or an assistant secretary of the Borrower, as
applicable;

(iii)                               resolutions of the board of directors of the
Borrower approving and authorizing the execution, delivery and performance of
the Loan Documents and certified as of the Effective Date by the secretary or
an assistant secretary of the Borrower as being in full force and effect
without modification or amendment;

(iv)                              signature and incumbency certificates of the
officers of the Borrower executing the Loan Documents on behalf of the
Borrower;

(v)                                 a good standing certificate or certificate of
existence, as applicable, from the Secretary of State (or similar official)
from the jurisdiction of formation of the Borrower, certified as of the
Effective Date (or a recent date prior to the Effective Date) (the matters
referenced in subsections 3.1A(ii)-(v) to be addressed in a secretary’s
certificate substantially in the form of Exhibit VII);

(vi)                              a certificate from an officer of the Borrower
substantially in the form of Exhibit VIII, in form and substance
satisfactory to the Administrative Agent, to the effect that all
representations and warranties contained in this Agreement and the other Loan
Documents are true, correct and complete (other than any such representation or
warranty that expressly relates to an earlier date, in which case such
representation or warranty shall have been true, correct and complete as of
such earlier date); that the Borrower and its Subsidiaries are not in violation
of any of the covenants contained in this Agreement and the other Loan
Documents; that no event shall have occurred and be continuing or would result
from the consummation of the transactions contemplated by this Agreement, that
would constitute an Event of Default or a Potential Event of Default (excluding
a Potential Event of Default under Section 7.13);

(vii)                           a certificate from the Chief Financial
Officer of the Borrower attesting that, before and immediately after giving
effect to the Transaction, the Borrower is and will be Solvent; and

 36
 

(viii)                        such other documents as the Administrative
Agent on behalf of the Lenders may reasonably request.

B.                                    Opinions of Counsel.  The
Administrative Agent shall have received originally executed copies of one or
more favorable written opinions of (i) Brian J. Smith, Senior Vice President
and General Counsel of the Borrower, and (ii) Mayer, Brown, Rowe & Maw,
LLP, special New York counsel for the Borrower, each in form and substance
reasonably satisfactory to the Administrative Agent and its counsel, dated as
of the Effective Date.

C.                                    PATRIOT Act.  Each
of the Lenders shall have received, at least two (2) Business Days in advance
of the Effective Date, all documentation and other information required by
Governmental Authorities under applicable “know-your-customer” and anti-money
laundering rules and regulations, including as required by the Uniting and
Strengthening America by Providing Appropriate Tools Required to Intercept and
Obstruct Terrorism (USA PATRIOT ACT) Act of 2001 (the “Patriot Act”).  Each Lender and each 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 such Agent, as applicable, to identify the Borrower in accordance with the
Patriot Act.

D.                                    No Undisclosed Material Adverse
Change.  Except as disclosed in writing by the
Borrower to the Administrative Agent and the Lenders on or prior to the
Effective Date, no event shall have occurred (including (i) the filing of, or
any adverse determination in, any action, suit, investigation, litigation,
arbitration or proceeding (whether administrative, judicial or otherwise)
affecting the Borrower or any of its Subsidiaries before any Governmental
Authority or arbitrator, (ii) any event arising under any Environmental Law or
relating to any Hazardous Materials Activity or (iii) the assertion of any
Environmental Claim) that has had, or could be reasonably expected to have,
individually or in the aggregate, a Material Adverse Effect.

3.2                               Conditions
Precedent to each Loan.

The
obligation of each Lender to make its Loan hereunder is subject to the
Effective Date having occurred and the satisfaction of the following
conditions, which (except for the conditions that require effectiveness of the
Scheme and consummation of the Acquisition) shall be conclusively tested no later
than 8:00 a.m., Sydney time, on the Second Court Date (as defined in the
Implementation Agreement):

A.                                    Notice of Borrowing.  The
Administrative Agent shall have received, in accordance with the provisions of
Section 2.1B, an originally executed Notice of Borrowing signed by the
Borrower.

B.                                    Representations and Warranties.  The
representations and warranties set forth in Section 4 shall be true, correct
and complete in all material respects on and as of the date of such Loan to the
same extent as though made on and as of that date, except to the extent such
representations and warranties specifically relate to an earlier date, in which
case such representations and warranties shall have been true, correct and
complete in all material respects

 37
 

on
and as of such earlier date, (it being understood that, notwithstanding that
any representation or warranty contained herein with respect to Mayne Pharma,
its Subsidiaries or their businesses is not true, correct and complete in all
material respects on and as of the relevant date, the Lenders shall be
obligated to make their Loans unless the Borrower or the relevant Subsidiary
has the right to terminate its obligations under the Implementation Agreement
as a result of breach by Mayne Pharma of the corresponding representation or
warranty in the Implementation Agreement).

C.                                    No Default.  No
Event of Default or a Potential Event of Default (excluding a Potential Event
of Default under Section 7.13) shall have occurred and be continuing, or would
result from, the Loans.

D.                                    Payment of Amounts Due.  The
Borrower shall have paid to the Lead Arrangers and the Agents, all reasonable
out-of-pocket costs, fees (including those fees due on the date of the Mayne
Pharma Acquisition referred to in Section 2.6), expenses (including reasonable
legal fees and expenses of a single U.S. counsel) and other compensation
payable on the date of the Mayne Pharma Acquisition.

E.                                      The Acquisition.  (i)
The Implementation Agreement shall not have been altered, amended or otherwise
changed or supplemented, in each case in any respect materially adverse to the
Lenders, or any condition therein waived, without the prior written consent of
the Lead Arrangers.

(ii)                                  There shall not have occurred any event,
occurrence or matter which individually or when aggregated with all such
events, occurrences or matters:

(a)                                  diminishes,
or could reasonably be expected to diminish (whether now or in the future) (x)
the consolidated net assets of Mayne Pharma and its Subsidiaries by an amount
of at least 10% of the consolidated net tangible assets of Mayne Pharma and its
Subsidiaries as disclosed in its audited balance sheet as at June 30, 2006; or
(y) the consolidated net profit after tax of Mayne Pharma and its Subsidiaries
in each of the financial years ending June 30, 2007, June 30, 2008 and June 30,
2009 by an amount of at least 7,000,000 Australian dollars (which amount shall
be calculated after taking into account any event, occurrence or matter not
disclosed prior to the date of the Implementation Agreement which has or could
reasonably be expected to have a positive effect in each of the three
aforementioned financial years);

(b)                                 has
the result that Mayne Pharma and its Subsidiaries are unable to carry on their
business in substantially the same manner as carried on as at the date of the
Implementation Agreement; or

(c)                                  which
otherwise materially and adversely affects the prospects of Mayne Pharma and
its Subsidiaries,

other than an event, occurrence or matter (x) which
relates to changes in prices of products sold by Mayne Pharma and its
Subsidiaries in response to changes in market conditions consistent with past
practice, (y) required to be done or procured by Mayne Pharma and its
Subsidiaries in connection with the Acquisition or (z) disclosed by Mayne 

 38
 

Pharma and its Subsidiaries in the disclosure letter
attached to the Implementation Agreement.

(iii)                               All
of the conditions precedent set forth in Section 3.1 of the Implementation
Agreement shall have been satisfied and the Scheme shall have become effective
in accordance with applicable law.

F.                                      No Undisclosed Material Adverse
Change.  Except as disclosed in writing by the
Borrower to the Administrative Agent and the Lenders on or prior to the Credit
Date, no event shall have occurred (including (i) the filing of, or any adverse
determination in, any action, suit, investigation, litigation, arbitration or
proceeding (whether administrative, judicial or otherwise) affecting the
Borrower or any of its Subsidiaries before any Governmental Authority or
arbitrator, (ii) any event arising under any Environmental Law or relating to
any Hazardous Materials Activity or (iii) the assertion of any Environmental
Claim) that has had, or could be reasonably expected to have, individually or
in the aggregate, a Material Adverse Effect.

G.                                    Additional Documents.  The
Administrative Agent shall have received each additional document, certificate,
instrument, legal opinion or other item reasonably requested by it.

SECTION 4.     REPRESENTATIONS AND WARRANTIES

In
order to induce the Agents and the Lenders to enter into this Agreement and to
induce the Lenders to make each Loan hereunder, the Borrower represents and
warrants to each Agent and each Lender that the following statements are true,
correct and complete:

4.1                               Organization,
Powers, Qualification, Good Standing, Business and Subsidiaries.

A.                                    Organization and Powers.  The
Borrower and each of its Subsidiaries is duly organized, validly existing and
in good standing, as applicable, under the laws of its jurisdiction of organization,
except, in the case of any Subsidiary of the Borrower, where the failure to be
so organized, existing or in good standing has not had and would not reasonably
be expected to have a Material Adverse Effect. 
The Borrower and each of its Subsidiaries has all requisite power and
authority to own, lease and operate its properties, to carry on its business as
now conducted and as proposed to be conducted, to enter into the Loan Documents
and to carry out the transactions contemplated thereby.

B.                                    Qualification and Good Standing.  The
Borrower and each of its Subsidiaries is duly qualified to do business and in
good standing, as applicable, in every jurisdiction in which its assets are
located and wherever necessary to carry out its business and operations, except
in jurisdictions where the failure to be so qualified or in good standing has
not had and would not reasonably be expected to have a Material Adverse Effect.

4.2                               Authorization
of Borrowing, etc.

A.                                    Authorization
of Borrowing, etc.  The execution,
delivery and performance of each Loan Document have been duly authorized by all
necessary action on the part of the Borrower.

 39

B.                                    No Conflict.  The
execution, delivery and performance by the Borrower of each Loan Document and
the consummation of the transactions contemplated thereby do not and will not
(i) violate any provision of any Applicable Law with respect to the Borrower or
any of its Subsidiaries, any of the Organizational Documents of the Borrower or
any order, judgment or decree of any Governmental Authority binding on the
Borrower or any of its Subsidiaries, except to the extent such violation would
not be reasonably expected to have a Material Adverse Effect, (ii) conflict
with, result in a breach of or constitute (with due notice or lapse of time or
both) a default under any Contractual Obligation of the Borrower or any of its
Subsidiaries, except to the extent such conflict, breach or default would not
reasonably be expected to have a Material Adverse Effect, (iii) result in or
require the creation or imposition of any Lien upon any of the properties or
assets of the Borrower or any of its Subsidiaries, or (iv) require any approval
of stockholders, partners or members or any approval or consent of any Person
under any Contractual Obligation of the Borrower or any of its Subsidiaries,
except for such approvals or consents which will be obtained on or before the
Effective Date and disclosed in writing to Administrative Agent.

C.                                    Governmental Consents.  The
execution, delivery and performance by the Borrower of each Loan Document and
the consummation of the transactions contemplated thereby do not and will not
require any Governmental Authorization (other than, prior to the Credit Date,
Governmental Authorizations required to complete the Mayne Pharma Acquisition).

D.                                    Binding Obligation.  Each
Loan Document has been duly executed and delivered by the Borrower and is the
legally valid and binding obligation of the Borrower, enforceable against the
Borrower in accordance with its terms, except as may be limited by bankruptcy,
insolvency, reorganization, moratorium or similar laws relating to or limiting
creditors’ rights generally or by equitable principles relating to
enforceability.

4.3                               Disclosure.

No
representation or warranty of the Borrower or any of its Subsidiaries contained
in any Loan Document or in any other document, certificate or written statement
furnished to any Agent or any Lender by or on behalf of the Borrower or any of
its Subsidiaries for use in connection with the transactions contemplated by
this Agreement contains any untrue statement of a material fact or omits to
state a material fact (known to the Borrower or any of its Subsidiaries in the
case of any document not furnished by any of them) necessary in order to make
the statements contained herein or therein not misleading in light of the
circumstances in which the same were made. 
Any projections and pro forma financial information contained in such
materials are based upon good faith estimates and assumptions believed by the
Borrower to be reasonable at the time made, it being recognized by the Agents
and the Lenders that such projections as to future events are not to be viewed
as facts and that actual results during the period or periods covered by any
such projections may differ from the projected results.

4.4                               Financial
Condition.

The
Borrower has heretofore delivered to the Administrative Agent the audited
consolidated balance sheet of the Borrower and its Subsidiaries as at December
31, 2005 and the related audited consolidated statements of income,
stockholders’ equity and cash flows of the

 40
 

Borrower for the
Fiscal Year then ended, together with all related notes and schedules
thereto.  All such statements were
prepared in conformity with GAAP and fairly present, in all material respects,
the financial position of the entities described in such financial statements
as at the respective dates thereof and the results of operations and cash flows
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. 
Neither the 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 the foregoing financial
statements or the notes thereto and which in any such case could reasonably be
expected to have a Material Adverse Effect.

4.5                               No
Material Adverse Change.

Except
as disclosed in the Borrower’s filings with the Securities and Exchange
Commission prior to September 20, 2006, no event or change occurred during the
period from December 31, 2005 through September 20, 2006 that had, or would
reasonably be expected to have, either individually or in the aggregate, a
Material Adverse Effect.

4.6                               Intellectual
Property Matters.

Except
where the failure to do so could not reasonably be expected to have a Material
Adverse Effect, each of the Borrower and its Subsidiaries owns or possesses
rights to use all franchises, licenses, copyright registrations, copyright
applications, issued patents, patent applications, trademarks, trademark
applications, trademark registrations, trademark rights, service marks, service
mark applications, service mark rights, trade names, trade name rights,
copyrights and rights with respect to the foregoing which are required to
conduct its business.  No event has
occurred which permits, or after notice or lapse of time or both would permit,
the revocation or termination of any such rights (except for the expiration of
patents in the ordinary course), and neither the Borrower nor any Subsidiary
thereof is liable to any Person for infringement under Applicable Law with
respect to any such rights as a result of its business operations except to the
extent any such revocation, termination, or infringement could not reasonably
be expected to have a Material Adverse Effect.

4.7                               No
Litigation; Compliance with Laws.

Except
for the matters disclosed in the Borrower’s filings with the Securities and
Exchange Commission prior to September 20, 2006, as of such date there were no
actions, suits, proceedings (whether administrative, judicial or otherwise),
litigations, arbitrations or governmental investigations (whether or not
purportedly on behalf of the Borrower or any of its Subsidiaries) at law or in
equity, or before or by any Governmental Authority, domestic or foreign
(including any Environmental Claims), that were pending or, to the knowledge of
the Borrower, threatened against or affecting the Borrower or any of its
Subsidiaries or any property of the Borrower or any of its Subsidiaries and
that, individually or in the aggregate, could have reasonably been expected to
result in a Material Adverse Effect. 
Prior to September 2006 and as of such date, neither the Borrower nor
any of its Subsidiaries was subject to or in default with respect to any final
judgment, writ, injunction, decree, rule or regulation of any Governmental
Authority, domestic or foreign, that, individually or in the aggregate, could
reasonably have been

 41
 

expected to result
in a Material Adverse Effect.  Neither
the Borrower nor any of its Subsidiaries is in violation of any Applicable Laws
(including Environmental Laws) that, individually or in the aggregate, could
reasonably be expected to result in a Material Adverse Effect.

4.8                               No
Default.

Neither
the Borrower nor any of its Subsidiaries is in default in the performance,
observance or fulfillment of any of the obligations, covenants or conditions
contained in any of its Contractual Obligations, and no condition exists that,
with the giving of notice or the lapse of time or both, would constitute such a
default, except where the consequences, direct or indirect, of such default or
defaults, if any, could not reasonably be expected to have a Material Adverse
Effect.

4.9                               Governmental
Regulation.

Neither
the Borrower nor any of its Subsidiaries is subject to regulation under the
Federal Power Act or the Investment Company Act of 1940 or under any 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 the Borrower 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.

4.10                        Securities
Activities.

Neither
the Borrower nor any of its Subsidiaries is engaged principally, or as one of
its important activities, in the business of extending credit for the purpose
of purchasing or carrying any Margin Stock. 
No part of the proceeds of the Loans will be used to purchase or carry
any Margin Stock or to extend credit to others for the purpose of purchasing or
carrying any Margin Stock in violation of the provisions of Regulation T, U or
X of the Board of Governors of the Federal Reserve System.

4.11                        Employee
Benefit Plans.

A.                                    Each of the Borrower and its ERISA Affiliates
is in material compliance with all applicable provisions and requirements of
ERISA and the Internal Revenue Code and the regulations and published
interpretations thereunder with respect to each Employee Benefit Plan, and have
performed all their obligations under each Employee Benefit Plan in all
material respects.  Each Employee Benefit
Plan which is intended to qualify under Section 401(a) of the Internal Revenue
Code has received a favorable determination letter from the Internal Revenue
Service or has submitted or will submit a request for such a determination
letter within the applicable remedial amendment period.

B.                                    No material liability to the PBGC (other than
required premium payments) or the Internal Revenue Service has been or is
expected to be incurred by the Borrower or any of its ERISA Affiliates with
respect to any Employee Benefit Plan, and no ERISA Event has occurred or is
reasonably expected to occur, other than ERISA Events for which the liability
has been satisfied in full or is immaterial in amount.

 42
 

C.                                    As of the most recent valuation date for each
Multiemployer Plan for which the actuarial report is available, the potential
liability of the Borrower or any of its ERISA Affiliates for a complete
withdrawal from such Multiemployer Plan (within the meaning of Section 4203 of
ERISA), when aggregated with such potential liability for a complete withdrawal
from all Multiemployer Plans, based on information available pursuant to
Section 4221(e) of ERISA is not expected to be material.  The Borrower and each of its Subsidiaries and
each of their ERISA Affiliates have complied in all material respects with the
requirements of Section 515 of ERISA with respect to each Multiemployer Plan
and are not in material “default” (as defined in Section 4219(c)(5) of ERISA)
with respect to payments to a Multiemployer Plan.

4.12                        Environmental
Protection.  As of September 20, 2006:

A.                                    Neither the Borrower nor any of its
Subsidiaries nor any of their respective Facilities or operations was subject
to any outstanding written order, consent decree or settlement agreement with
any Person relating to any Environmental Law, any Environmental Claim, or any
Hazardous Materials Activity that, individually or in the aggregate, could
reasonably have been expected to have a Material Adverse Effect.

B.                                    Neither the Borrower nor any of its
Subsidiaries had received any letter or request for information under Section
104 of the Comprehensive Environmental Response, Compensation, and Liability
Act (42 U.S.C. § 9604) or any comparable state law, except to the extent that
such letter or request could not reasonably have been expected to have a Material
Adverse Effect.

C.                                    There were not and, to the Borrower’s and
each of its Subsidiaries’ knowledge, had not been any condition, occurrence, or
Hazardous Materials Activity which could reasonably have been expected to form
the basis of an Environmental Claim against the Borrower or any of its
Subsidiaries that, individually or in the aggregate, could reasonably have been
expected to have a Material Adverse Effect.

D.                                    Compliance with all then-current or
reasonably foreseeable future requirements pursuant to or under Environmental
Laws could not, individually or in the aggregate, reasonably have been expected
to give rise to a Material Adverse Effect.

E.                                      Neither the Borrower nor any of its
Subsidiaries nor, to the knowledge of the Borrower, any predecessor of the
Borrower or any Subsidiary of such predecessor, had filed any notice under any
Environmental Law indicating past or present treatment of Hazardous Materials
at any Facility, and none of the Borrower’s nor any of its Subsidiaries’
operations involved the generation, transportation, treatment, storage or
disposal of hazardous waste, as defined under 40 C.F.R.  Parts 260 270 or any state equivalent, except
to the extent that any of the foregoing could not reasonably have been expected
to have a Material Adverse Effect.

F.                                      No event or condition had occurred or was
occurring with respect to the Borrower or any of its Subsidiaries relating to
any Environmental Law, any Release of Hazardous Materials, or any Hazardous
Materials Activity which individually or in the aggregate had had, or could
reasonably have been expected to have, a Material Adverse Effect.

 43
 

4.13                        Pari
Passu.

The
Obligations and any other claims of the Lead Arrangers, the Agents and the
Lenders arising hereunder or under any of the Loan Documents rank at least pari passu with the claims of all of the
Borrower’s other senior unsecured creditors, except those creditors whose
claims are preferred by any bankruptcy, insolvency, reorganization, moratorium
or similar laws relating to or limiting creditors’ rights generally.

4.14                        Restrictions.

There
are no contractual restrictions on the Borrower or any of its Subsidiaries
which prohibit or otherwise restrict the transfer of cash or other assets from
any such Subsidiary to the Borrower, other than prohibitions or restrictions
permitted under Section 6.4.

SECTION 5.     AFFIRMATIVE COVENANTS

The
Borrower covenants and agrees that, so long as the Commitments shall remain in
effect and until payment in full of all Obligations (other than Surviving
Obligations), unless the provisions of this Section 5 are waived or amended in
accordance with Section 8.5, the Borrower shall perform, and shall cause each
of its Subsidiaries to perform, all covenants in this Section 5.

5.1                               Financial
Statements and Other Reports.

The
Borrower will deliver to Administrative Agent:

(i)                                     Quarterly Financial Statements:  as
soon as available, and in any event within 45 days after the end of each of the
first three (3) Fiscal Quarters of each Fiscal Year, the unaudited consolidated
balance sheet of the Borrower and its Subsidiaries as at the end of such Fiscal
Quarter and the related consolidated statements of income, stockholders’ equity
and cash flows of the Borrower and its Subsidiaries for such Fiscal Quarter and
for the period from the beginning of the then-current Fiscal Year to the end of
such Fiscal Quarter, setting forth in each case in comparative form the
corresponding figures for the corresponding periods of the previous Fiscal
Year, all in reasonable detail and certified by the chief financial officer of
the Borrower as fairly presenting, in all material respects, the financial
condition of the Borrower and its Subsidiaries as at the date indicated and the
results of their operations and cash flows for the periods indicated in conformity
with GAAP, subject to the absence of footnotes and changes resulting from audit
and normal year-end adjustments;

(ii)                                  Annual Financial Statements:  as
soon as available, and in any event within 90 days after the end of each Fiscal
Year, (i) the consolidated balance sheets of the Borrower and its Subsidiaries
as at the end of such Fiscal Year and the related consolidated statements of
income, stockholders’ equity and cash flows of the Borrower and its
Subsidiaries for such Fiscal Year, setting forth in each case in comparative
form the corresponding figures for the previous Fiscal Year, in reasonable
detail and certified by the chief financial officer of the Borrower as fairly
presenting, in all material respects, the financial condition of the Borrower
and its Subsidiaries as at the date indicated and the results of their
operations and cash flows for the periods indicated; and (ii) with respect such
consolidated financial statements a report thereon of Deloitte and Touche LLP
or other independent certified public accountants of

 44
 

recognized national standing selected by the
Borrower, and reasonably satisfactory to the Administrative Agent (which report
shall be unqualified as to going concern and scope of audit, and shall state
that such consolidated financial statements fairly present, in all material
respects, the consolidated financial position of the Borrower and its
Subsidiaries as at the dates indicated and the results of their operations and
their cash flows for the periods indicated in conformity with GAAP applied on a
basis consistent with prior years (except as otherwise disclosed in such
financial statements) and that the examination by such accountants in
connection with such consolidated financial statements has been made in
accordance with generally accepted auditing standards);

(iii)                               Compliance Certificate: 
together with each delivery of financial statements of the Borrower and
its Subsidiaries pursuant to Sections 5.1(i) and 5.1(ii), a duly executed and
completed Compliance Certificate;

(iv)                              Filings:  promptly upon their becoming
available, copies of (a) all financial statements, reports, notices and proxy
statements sent by the Borrower to its shareholders or other security holders,
and (b) all material information filed by the Borrower or any of its
Subsidiaries with the Securities and Exchange Commission or any national
securities exchange;

(v)                                 Notice of Default, etc.: 
promptly upon (and in any event within five (5) Business Days after) any
Responsible Officer of the Borrower obtaining knowledge (a) of any condition or
event that constitutes an Event of Default or Potential Event of Default or
that notice has been given to the Borrower or any of its Subsidiaries with
respect thereto, (b) that any Person has given any notice to the Borrower or
any of its Subsidiaries or taken any other action with respect to a claimed
default or event or condition of the type referred to in Section 7.2, or (c) of
the occurrence of any event or change that has caused or evidences, either in
any case individually or in the aggregate, a Material Adverse Effect, an
Officer’s Certificate specifying the nature and period of existence of such
condition, event or change, or specifying the notice given or action taken by
any such Person and the nature of such claimed Event of Default, Potential
Event of Default, default, event or condition, and what action the Borrower has
taken, is taking and proposes to take with respect thereto;

(vi)                              Notice of Litigation: 
promptly upon (and in any event within five (5) Business Days after) any
officer of the Borrower obtaining knowledge of (a) the institution of, or
non-frivolous threat of, any action, suit, proceeding, order, consent decree,
settlement (whether administrative, judicial or otherwise), governmental
investigation or arbitration against or affecting the Borrower or any of its
Subsidiaries or any of their respective property, including of the type
described in Section 4.17 (collectively, “Proceedings”) or (b)
any material development in any such Proceeding that, in the case of either (a)
or (b) if adversely determined, could be reasonably expected to have a Material
Adverse Effect, or seeks to enjoin or otherwise prevent the consummation of, or
to recover any damages or obtain relief as a result of, the transactions contemplated
hereby, written notice thereof together with such other information as may be
reasonably available to the Borrower or such Subsidiary to enable Lenders and
their counsel to evaluate such matters;

 45
 

(vii)                           Change in Rating: 
promptly upon (and in any event within five (5) Business Days after)
obtaining knowledge thereof, written notice of any changes in the rating given
the Borrower’s long-term senior unsecured debt by Moody’s or S&P;

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

(ix)                                Environmental Reports and Audits:  as
soon as practicable following receipt thereof, copies of all environmental
audits and reports with respect to environmental matters at any property, plant
or other Facility or which relate to any environmental liabilities of the
Borrower or its Subsidiaries which, in any such case, individually or in the
aggregate, could reasonably be expected to result in a Material Adverse Effect;

(x)                                   Public Filings: 
promptly after the same become publicly available, copies of all
periodic and other reports, proxy statements and other materials filed by the
Borrower or any of its Subsidiaries with the Securities and Exchange
Commission, or any Governmental Authority succeeding to any or all of the
functions of the Securities and Exchange Commission, or distributed by the
Borrower to its shareholders generally; and

(xi)                                Other Information:  with
reasonable promptness, such other information and data with respect to the
Borrower and its Subsidiaries as from time to time may be reasonably requested
by the Administrative Agent or any Lender.

5.2                               Books
and Records.

The
Borrower will, and will cause each of its Subsidiaries to keep proper books of
records and account in which full, true and correct entries in all material
respects in conformity with GAAP consistently applied shall be made of all
material dealings and transactions in relation to its business and activities
and permit representatives or agents of the Administrative Agent or any Lender
to visit and inspect any of its properties or assets and examine and make
abstracts from any of its books and records upon reasonable prior notice during
normal business hours and as often as may reasonably be desired, and to discuss
the business, operations, properties and financial and other condition of the
Borrower and its Subsidiaries with officers and employees of the Borrower and
independent public accountants of the Borrower and its Subsidiaries so long as
the Borrower is provided the opportunity to participate in such discussions.

 46
 

5.3                               Existence.

Except
as otherwise permitted by Section 6.6, the Borrower 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, privileges, licenses and franchises material to
its business; provided that neither the Borrower nor any of its
Subsidiaries shall be required to preserve any such right, privilege, license
or franchise if management of the Borrower or such Subsidiary shall reasonably
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 the Borrower or the Lenders.

5.4                               Insurance.

The
Borrower will maintain or cause to be maintained, with financially sound and
reputable insurers, such public liability insurance, third party property
damage insurance, business interruption insurance and casualty insurance with
respect to liabilities, losses or damage in respect of the assets, properties
and businesses of the Borrower and its Subsidiaries as may customarily be
carried or maintained under similar circumstances by Persons of established
reputation engaged in similar businesses, in each case in such amounts (giving
effect to self-insurance), with such deductibles, covering such risks and
otherwise on such terms and conditions as shall be customary for such Persons.

5.5                               Payment
of Taxes and Claims.

The
Borrower will, and will cause each of its Subsidiaries to, pay all federal
income Taxes and other material Taxes imposed upon it or any of its properties
or assets or in respect of any of its income, businesses or franchises before
any penalty or fine accrues thereon; provided no such Tax need be paid
(a) if it is being contested in good faith by appropriate proceedings promptly
instituted and diligently conducted, so long as adequate reserve or other
appropriate provision, as shall be required in conformity with GAAP shall have
been made therefor or (b) if the aggregate amount of all unpaid Taxes that have
not been paid by the Borrower and its Subsidiaries (excluding amounts being
contested as provided in clause (a)) does not exceed $5,000,000 and could not
reasonably be expected to have a Material Adverse Effect.  The Borrower will not, nor will it permit any
of its Subsidiaries to, file or consent to the filing of any consolidated
income Tax return with any Person (other than the Borrower or any of its
Subsidiaries).

5.6                               Payment
and Performance of Obligations.

The
Borrower will, and will cause each of its Subsidiaries to, pay and perform all
Obligations under this Agreement and the other Loan Documents.

5.7                               Maintenance
of Properties.

The
Borrower will, and will cause each of its Subsidiaries to, maintain or cause to
be maintained in good repair, working order and condition, ordinary wear and
tear excepted, all material properties used or useful in the business of the
Borrower and its Subsidiaries and from

 47
 

time to time will
make or cause to be made all appropriate repairs, renewals and replacements
thereof.

5.8                               Compliance
with Laws.

The
Borrower will, and will cause each of its Subsidiaries to, comply with the
requirements of all Applicable Laws, rules, regulations and orders of any
Governmental Authority (including all Environmental Laws), noncompliance with
which could reasonably be expected to have, individually or in the aggregate, a
Material Adverse Effect.

5.9                               Use
of Proceeds.

A.                                    Proceeds of Loans.  The
proceeds of each Loan shall be used (i) to effect the Mayne Pharma Acquisition
and (ii) to pay costs and expenses in connection with the Transaction.

B.                                    Margin Regulations.  No
part of the proceeds of the Loans made to the Borrower will be used to purchase
or carry any Margin Stock or to extend credit to others for the purpose of
purchasing or carrying any Margin Stock in violation of the provisions of
Regulation T, U or X of the Board of Governors of the Federal Reserve System.

5.10                        Claims
Pari Passu.

The
Borrower shall ensure that at all times the Obligations and any other claims of
the Lead Arrangers, the Agents and the Lenders arising hereunder or under any
other Loan Document rank at least pari passu
with the claims of the Borrower’s other senior unsecured creditors, except
those creditors whose claims are preferred by any bankruptcy, insolvency,
reorganization, moratorium or similar laws relating to or limiting creditors’
rights generally.

5.11                        Further
Assurances.

At
any time or from time to time upon the request of the Administrative Agent, the
Borrower will, and will cause each of its Subsidiaries to, at its expense,
promptly execute, acknowledge and deliver such further documents and do such
other acts and things as the Administrative Agent may reasonably request in
order to effect fully the purposes of the Loan Documents.

SECTION 6.     NEGATIVE COVENANTS

The
Borrower covenants and agrees that, so long as the Commitments hereunder shall
remain in effect and until payment in full of all Obligations (other than
Surviving Obligations), unless the provisions of this Section 6 are waived or
amended in accordance with Section 8.5, the Borrower shall perform, and shall
cause each of its Subsidiaries to perform, all covenants in this Section 6.

 48
 

6.1                               Liens.

The
Borrower shall not, and shall not permit any of its Subsidiaries to, directly
or indirectly, create, incur, assume or permit to exist any Lien on or with
respect to any property or asset of any kind of the Borrower or any of its
Subsidiaries, whether now owned or hereafter acquired, or any income or profits
therefrom, except:

(i)                                     Liens existing on the Effective Date and
described on Schedule 6.1 hereto and other Liens securing Indebtedness
existing on the Effective Date the individual principal amount of which does
not exceed $500,000;

(ii)                                  Liens imposed by law for Taxes that are not
yet required to be paid pursuant to Section 5.5;

(iii)                               statutory Liens of landlords, banks
(including rights of set-off), carriers, warehousemen, mechanics, repairmen,
workmen and material men, and other Liens imposed by law, in each case incurred
in the ordinary course of business for amounts not yet overdue or for amounts
that are overdue and that (in the case of any such amounts overdue for a period
in excess of five days) are being contested in good faith by appropriate
proceedings, so long as such reserves or other appropriate provisions, if any,
as shall be required by GAAP shall have been made for any such contested amounts;

(iv)                              deposits made in the ordinary course of
business in connection with workers’ compensation, unemployment insurance and
other types of social security, or to secure the performance of tenders,
statutory obligations, surety and appeal bonds, bids, leases, government
contracts, performance and return-of-money bonds and other similar obligations
(exclusive of obligations for the payment of borrowed money or other
Indebtedness) incurred in the ordinary course of business;

(v)                                 easements, rights-of-way, restrictions,
encroachments, and other minor defects or irregularities in title to real
property of the Borrower or any Subsidiary of the Borrower, in each case which
do not and will not, individually or in the aggregate, interfere in any
material respect with the use or value thereof;

(vi)                              any interest or title of a lessor or
sublessor under any operating or true lease of real estate entered into by the
Borrower or one of its Subsidiaries in the ordinary course of its business
covering only the assets so leased;

(vii)                           Liens securing Indebtedness pursuant to
Capital Leases; provided that (a) such Liens are only in respect of the
property or assets subject to, and secure only, such Capital Leases, (b)
Indebtedness of Subsidiaries under Capital Leases shall be limited by the
provisions of Section 6.2 and (c) the aggregate amount of all Indebtedness of
the Borrower under Capital Leases shall not at any time exceed $25,000,000;

(viii)                        purchase money Liens in real property,
improvements thereto or equipment hereafter acquired (or, in the case of
improvements, constructed) by the Borrower or one of its Subsidiaries; provided
that (a) such Lien secures Indebtedness permitted by Section 6.2), (b) such
Lien is incurred, and the Indebtedness secured thereby is created, within
ninety

 49
 

(90)
days after completion of such acquisition (or construction), (c) the
Indebtedness secured thereby does not exceed 100% of the lesser of the cost or
the fair market value of such real property, improvements or equipment at the
time of such acquisition (or construction) and (d) such Lien does not apply to
any other property or assets of the Borrower or any of its Subsidiaries;

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

(x)                                   licenses of patents, trademarks and other
intellectual property rights granted by the Borrower or any of its Subsidiaries
in the ordinary course of business and not interfering in any respect with the
ordinary conduct of the business of the Borrower or such Subsidiary; and

(xi)                                Liens on assets of Persons acquired after the
Effective Date subject to the terms of this Agreement; provided that
such Liens exist at the time such Person becomes a Subsidiary and were not
created in anticipation thereof;

(xii)                             Liens incurred in connection with Qualified
Receivables Transactions;

(xiii)                          Any Lien incurred to renew, extend or
refinance obligations secured by a Lien referred to in clause (viii) or (xi)
above, provided that (a) the principal or face amount of the obligations
secured by any such Lien does not exceed the outstanding principal or face
amount of the obligations so renewed, extended or refinanced immediately prior
to such renewal, extension or refinancing and (b) any such Lien attaches solely
to the assets that secured the obligations so renewed, extended or refinanced;
and

(xiv)                         Liens not otherwise permitted by the
foregoing clauses of this Section 6.1 securing obligations in an aggregate
principal amount at any time outstanding not to exceed 10% of Consolidated Net
Worth.

Notwithstanding
any of the foregoing exceptions, the Borrower will not, and will not permit any
of its Subsidiaries to, create, incur, assume or suffer to exist any Lien upon
the Capital Stock of any of its Subsidiaries or any Indebtedness owed to it by
the Borrower or any of its Subsidiaries.

6.2                               Indebtedness.

The
Borrower shall not permit any of its Subsidiaries to, directly or indirectly,
create, incur, assume or guaranty, or otherwise become or remain directly or
indirectly liable with respect to, any Indebtedness, except:

(i)                                     Indebtedness owing by any wholly-owned
Subsidiary of the Borrower to the Borrower or another wholly-owned Subsidiary
of the Borrower;

(ii)                                  Indebtedness existing on the Effective Date
and set forth on Schedule 6.2, but, in each case, not any extensions,
renewals or replacements of such Indebtedness except (a) renewals and
extensions expressly provided for in the agreements evidencing any such
Indebtedness as the same are in effect on the date of this Agreement and (b)
refinancings and

 50
 

extensions
of any such Indebtedness if the terms and conditions thereof are not less
favorable to the obligor thereon or to the Lenders than the Indebtedness being
refinanced or extended or are otherwise on substantially then prevailing market
terms, and the average life to maturity thereof is greater than or equal to
that of the Indebtedness being refinanced or extended; provided such
Indebtedness permitted under the immediately preceding clause (a) or (b) above
shall not (A) include Indebtedness of an obligor that was not an obligor with
respect to the Indebtedness being extended, renewed or refinanced, (B) exceed
in a principal amount the Indebtedness being renewed, extended or refinanced or
(C) be incurred, created or assumed if any Potential Event of Default or Event
of Default has occurred and is continuing or would result therefrom;

(iii)                               Indebtedness arising from the honoring by a
bank or other financial institution of a check, draft or similar instrument
drawn against insufficient funds in the ordinary course of business, provided
that such Indebtedness is extinguished within seven (7) Business Days of its
incurrence;

(iv)                              Indebtedness owed to (including obligations
in respect of letters of credit or bank guarantees or similar instruments for
the benefit of) any Person providing workers’ compensation, health, disability
or other employee benefits or property, casualty or liability insurance to the
Borrower or any of its Subsidiaries, pursuant to reimbursement or
indemnification obligations to such Person, provided that upon the
incurrence of Indebtedness with respect to reimbursement obligations regarding
workers’ compensation claims, such obligations are reimbursed not later than 30
days following such incurrence;

(v)                                 Indebtedness incurred by any Subsidiary of
the Borrower arising from agreements providing for indemnification, adjustment
of purchase price or similar obligations, or from guaranties or letters of
credit, surety bonds or performance bonds securing the performance of the
Borrower or any such Subsidiary pursuant to such agreements, in connection with
permitted dispositions of any business or asset (including the stock of any
Subsidiary of the Borrower);

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

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

(viii)                        Indebtedness (including guarantees of any
such Indebtedness) of a Subsidiary located in a country other than the U.S.; provided
that the outstanding principal amount of all Indebtedness permitted by this
clause (viii) (without double counting guarantees of any such Indebtedness)
shall not at any time exceed $100,000,000;

(ix)                                the Obligations; and

(x)                                   other Indebtedness in an aggregate principal
amount at any time outstanding not to exceed 15% of Consolidated Net Worth.

 51
 

6.3                               Acquisitions.

The
Borrower will not, and will not permit any of its wholly-owned Subsidiaries to,
make any Acquisition (other than the Mayne Pharma Acquisition and (ii) any
Acquisition by the Borrower or a wholly-owned Subsidiary of the Borrower of a
wholly-owned Subsidiary of the Borrower) if an Event of Default or Potential
Event of Default exists or would result therefrom.

6.4                               Restrictions
on Subsidiary Distributions.

Except
as provided herein, the Borrower shall not, and shall not permit any of its
Subsidiaries to, create or otherwise cause or suffer to exist or become
effective any consensual encumbrance or restriction of any kind on the ability
of any Subsidiary of the Borrower to (a) pay dividends or make any other
distributions on any of such Subsidiary’s Capital Stock owned by the Borrower
or any other Subsidiary of the Borrower, (b) repay or prepay any Indebtedness
owed by such Subsidiary to the Borrower or any other Subsidiary of the
Borrower, (c) make loans or advances to the Borrower or any other Subsidiary of
the Borrower, or (d) transfer any of its property or assets to the Borrower or
any other Subsidiary of the Borrower, other than restrictions (i) existing
under this Agreement, (ii) in agreements evidencing Indebtedness pursuant to
Capital Leases permitted by Section 6.2 that impose restrictions on the
property so acquired (except that such agreements shall not in any manner limit
the ability of the Borrower or any Subsidiary of the Borrower to pay dividends
or make any other distribution), (iii) by reason of customary provisions
restricting assignments, subletting or other transfers contained in leases,
licenses, Joint Venture agreements and similar agreements entered into in the
ordinary course of business, (iv) by reason of customary subordination
provisions in any guaranty or similar arrangement (including any arrangement of
the type described in clause (vii), (viii) or (ix) of the definition of
“Indebtedness” or (v) imposed on a Subsidiary pursuant to an agreement which
has been entered into in connection with the disposition of all of
substantially all of the capital stock or assets of such Subsidiary.

6.5                               Restricted
Payments.

The
Borrower shall not, and shall not permit any of its Subsidiaries to, directly
or indirectly, declare, pay, make or set aside any sum for any Restricted
Payment if an Event of Default or a Potential Event of Default exists or would
result therefrom.

6.6                               Restriction
on Fundamental Changes and Asset Sales.

The
Borrower shall not, and shall not permit any of its Subsidiaries to, enter into
any transaction of merger or consolidation, or liquidate, wind-up or dissolve
itself (or suffer any liquidation or dissolution), or convey, sell, lease or
sub-lease (as lessor or sub-lessor), exchange, transfer or otherwise dispose
of, in one transaction or a series of transactions, all or substantially all of
its business, assets or property; provided that (a) the Borrower and its
Subsidiaries may make Acquisitions permitted by Section 6.3; and (b) so long as
no Event of Default or Potential Event of Default exists or would result
therefrom:

(i)                                     any Subsidiary of the Borrower may merge or
consolidate with or into, or dispose of assets to, any other Subsidiary or to
the Borrower;

 52
 

(ii)                                  any
Subsidiary may merge or consolidate with or into another Person, convey,
transfer, lease or otherwise dispose of all or any portion of its assets so
long as (A) the consideration received in respect of such merger,
consolidation, conveyance, transfer, lease or other disposition is at least
equal to the fair market value of such assets and (B) no Material Adverse
Effect could reasonably be expected to result from such merger, consolidation,
conveyance, transfer, lease or other disposition; and

(iii)                               the
Borrower may merge with any other Person so long as the Borrower is the
surviving entity.

6.7                               Conduct
of Business.

From
and after the Effective Date, the Borrower shall not, and shall not permit any
of its Subsidiaries to, engage in any material business or conduct any
activities other than (a) businesses conducted by the Borrower and its
Subsidiaries as of the Effective Date, (b) businesses conducted by Mayne Pharma
and its Subsidiaries as of September 20, 2006 and (c) and businesses reasonably
related to the foregoing.

6.8                               Fiscal
Year.

The
Borrower shall not make or permit, or permit any of its Subsidiaries to make or
permit, any change in its fiscal year, provided that Mayne Pharma or any
Subsidiary thereof may make any change that is necessary or appropriate to
cause its fiscal year to correspond with the Borrower’s fiscal year.

6.9                               Subordinated
Indebtedness.

The
Borrower shall not, and shall not permit any of its Subsidiaries to, amend or
otherwise change the terms of any Subordinated Indebtedness, or make any
optional payment or any payment pursuant thereto, if the effect of such
amendment or change is to increase the interest rate on such Subordinated
Indebtedness, change (to earlier dates) any dates upon which payments of principal
or interest are due thereon, change any event of default or condition to an
event of default with respect thereto (other than to eliminate any such event
of default or increase any grace period related thereto), change the
redemption, prepayment or defeasance provisions thereof, change the
subordination provisions of such Subordinated Indebtedness (or of any guaranty
thereof), or if the effect of such amendment or change, together with all other
amendments or changes made, is to increase materially the obligations of the
obligor thereunder or to confer any additional rights on the holders of such
Subordinated Indebtedness (or a trustee or other representative on their
behalf) which would be adverse to the Borrower or the Lenders.

6.10                        Transactions
with Shareholders and Affiliates.

The
Borrower shall not, and shall not permit any of its Subsidiaries to, directly
or indirectly, enter into or permit to exist any transaction (including the
purchase, sale, lease or exchange of any property or the rendering of any
service or the making of any intercompany loan) with any Affiliate of the
Borrower or any of its Subsidiaries, any holder of Capital Stock or other
interests in the Borrower or any of its Subsidiaries, or any such Affiliate of
any such

 53
 

holder, on fair and
reasonable terms that are less favorable to the Borrower or such Subsidiary, as
the case may be, than those that might be obtained at the time in a comparable
arm’s length transaction from a Person who is not such a holder or Affiliate; provided
the foregoing restriction shall not apply to (a) any transaction between the
Borrower and its Subsidiaries or between such Subsidiaries to the extent
otherwise permitted hereunder; (b) reasonable and customary fees paid to
members of the board of directors (or similar governing body) of the Borrower
and its Subsidiaries; (c) compensation arrangements for officers and other
employees of the Borrower and its Subsidiaries entered into in the ordinary
course of business; (d) transactions described on Schedule 6.10; and (e)
transactions in connection with Qualified Receivables Transactions permitted
under this Agreement.

6.11                        Financial
Covenants.

A.                                    Interest Coverage Ratio.  The
Borrower shall not permit the Interest Coverage Ratio as of the last day of any
Fiscal Quarter to be less than the ratio shown below opposite such last day:

	
  Fiscal Quarter Ending

  	
   

  	
  Ratio

  	
   

  
	
  December 31, 2006

  	
   

  	
  4.00 to 1

  	
   

  
	
  March 31, 2007

  	
   

  	
  4.00 to 1

  	
   

  
	
  June 30, 2007

  	
   

  	
  4.50 to 1

  	
   

  
	
  September 30, 2007

  	
   

  	
  4.75 to 1

  	
   

  
	
  December 31, 2007 and thereafter

  	
   

  	
  5.00 to 1

  	
   

  

 

B.                                    Leverage Ratio.  The
Borrower shall not permit the Leverage Ratio as of the last day of any Fiscal
Quarter to exceed the ratio shown below opposite such last day:

	
  Fiscal Quarter Ending

  	
   

  	
  Ratio

  	
   

  
	
  December 31, 2006

  	
   

  	
  4.50 to 1

  	
   

  
	
  March 31, 2007

  	
   

  	
  4.50 to 1

  	
   

  
	
  June 30, 2007

  	
   

  	
  4.00 to 1

  	
   

  
	
  September 30, 2007

  	
   

  	
  3.50 to 1

  	
   

  
	
  December 31, 2007 and thereafter

  	
   

  	
  3.25 to 1

  	
   

  

 

C.                                    Certain Calculations.  With
respect to any period during which a Permitted Acquisition (excluding the
Acquisition by the Borrower or a Subsidiary of Bresagen Limited) or an Asset
Sale has occurred (each, a “Subject
Transaction”), for purposes
of determining compliance with the financial covenants set forth in this
Section 6.11, Consolidated Adjusted EBITDA shall be calculated with respect to
such period on a pro forma basis using the historical audited financial
statements of any business so acquired or to be acquired or sold or to be sold

 54
 

and
the consolidated financial statements of the Borrower and its Subsidiaries
which shall be reformulated as if such Subject Transaction, and any
Indebtedness incurred or repaid in connection therewith, had been consummated
or incurred or repaid at the beginning of such period.

6.12                        Interest
Rate Agreements and Currency Agreements.

The
Borrower shall not, and shall not permit any of its Subsidiaries to, enter into
any Interest Rate Agreement or Currency Agreement after the Effective Date
except Interest Rate Agreements and Currency Agreements entered into to hedge
or manage bona fide risks to which the Borrower or any such Subsidiary is
exposed in the conduct of its business or the management of its liabilities
(and, in any event, not for speculative purposes).

SECTION 7.     EVENTS OF DEFAULT

If
any of the following conditions or events (each an “Event of Default”) shall occur:

7.1                               Failure
to Make Payments When Due.

Failure
by the Borrower to pay (i) any installment of principal of any Loan when due,
whether at stated maturity, by acceleration, by notice of voluntary prepayment,
by mandatory prepayment or otherwise; or (ii) any interest on any Loan or any
fee or any other amount due under this Agreement within five (5) days after the
date due; or

7.2                               Default
in Other Agreements.

Failure
of the Borrower or any of its Subsidiaries 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 7.1 above) in
excess of $20,000,000 in the aggregate and in each case beyond the end of any
grace period provided therefor, if any; or (ii) breach or default by the
Borrower or any of its Subsidiaries with respect to any other material term of
(a) one or more items of such Indebtedness or (b) any loan agreement, mortgage,
indenture or other agreement relating to such item(s) of Indebtedness, in each
case beyond the end of any grace period provided therefor, if any, if the
effect of such breach or default is to cause, or to permit the holder or
holders of that Indebtedness (or a trustee on behalf of such holder or holders)
to cause, that Indebtedness to become or be declared due and payable (or
redeemable) prior to its stated maturity or the stated maturity of any
underlying obligation, as the case may be; or

7.3                               Breach
of Certain Covenants.

Failure
of the Borrower to perform or comply with any term or condition contained in
Sections 5.1(v)(a), 5.3 (solely with respect to (1) the existence of the
Borrower and (2) the failure of the Borrower to preserve or keep in full force and
effect its rights, privileges, licenses and franchises if such failure would
reasonably be expected to have a Material Adverse Effect), 5.9 or 6 of this
Agreement; or

 55

7.4                               Breach
of Representation or Warranty.

Any
representation, warranty, certification or other statement made by the Borrower
in any Loan Document or in any statement or certificate at any time given by
the Borrower in writing pursuant thereto or in connection therewith shall be
false in any material respect on the date as of which made; or

7.5                               Other
Defaults Under Loan Documents.

The
Borrower shall default in the performance of or compliance with any term
contained in this Agreement or any other Loan Document (other than those
specified in Sections 7.1, 7.2, 7.3 and 7.4) and such default or non-compliance
shall not be cured or waived within thirty (30) days after the Borrower shall
have received notice from the Administrative Agent of such default; or

7.6                               Involuntary
Bankruptcy; Appointment of Receiver, etc.

(i)
A court of competent jurisdiction shall enter a decree or order for relief in
respect of any the Borrower or any of its Significant Subsidiaries in an
involuntary case under the Bankruptcy Code or under any other applicable
bankruptcy, insolvency 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 federal or state law; or (ii) an involuntary case shall be commenced
against the Borrower or any of its Significant Subsidiaries under the
Bankruptcy Code or under any other applicable bankruptcy, insolvency 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, examiner, custodian or other officer having similar
powers over the Borrower or any of its Significant Subsidiaries, or over all or
a substantial part of their respective property, shall have been entered; or
there shall have occurred the involuntary appointment of an interim receiver,
trustee, examiner or other custodian of the Borrower or any of its Significant
Subsidiaries for all or a substantial part of their respective property; or a
warrant of attachment, execution or similar process shall have been issued
against any substantial part of the property of the Borrower or any of its
Significant Subsidiaries, and any such event described in this clause (ii)
shall continue for sixty (60) days unless dismissed, bonded or discharged; or

7.7                               Voluntary
Bankruptcy; Appointment of Receiver, etc.

The
Borrower or any of its Significant Subsidiaries shall have an order for relief
entered with respect to it or commence a voluntary case under the Bankruptcy
Code or under any other applicable bankruptcy, insolvency 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 the Borrower or any of its Significant Subsidiaries
shall make any assignment for the benefit of creditors; or the Borrower or  any of its Significant Subsidiaries shall be
unable, or shall fail generally, or shall admit in writing their respective
inability, to pay its debts as such debts become due; or the board of directors
(or similar governing body) of the Borrower or any of its Significant
Subsidiaries (or any committee thereof) shall adopt any resolution or otherwise

 56
 

authorize any
action to approve any of the actions referred to in this Section 7.7 or in
Section 7.6 above; or

7.8                               Judgments
and Attachments.

Any
money judgment, writ or warrant of attachment or similar process involving in
excess of $20,000,000 (not adequately covered by insurance as to which a
solvent and unaffiliated insurance company has acknowledged coverage) shall be
entered or filed against the Borrower or any of its Subsidiaries, or any of
their respective assets, and shall remain undischarged, unvacated, unbonded or
unstayed for a period of sixty (60) days (or in any event later than five (5)
days prior to the date of any proposed sale thereunder); or

7.9                               Dissolution.

Any
order, judgment or decree shall be entered against the Borrower or any of its
Subsidiaries decreeing the dissolution or split up of such Person; or

7.10                        Employee
Benefit Plans.

There
shall occur one or more ERISA Events which individually or in the aggregate
results in or might reasonably be expected to result in liability of the
Borrower or any of its Subsidiaries or any of their respective ERISA Affiliates
in excess of $10,000,000 during the term of this Agreement; or there shall
exist any fact or circumstance that reasonably could be expected to result in
the imposition of a Lien or security interest under Section 412(n) of the
Internal Revenue Code or under ERISA; or

7.11                        Change
in Control.

A
Change of Control shall occur; or

7.12                        Repudiation
of Obligations.

At
any time after the execution and delivery thereof, (i) this Agreement for any
reason shall cease to be in full force and effect (other than by reason of the
satisfaction in full of the Obligations) or shall be declared null and void, or
(ii) the Borrower shall contest the validity or enforceability of any Loan
Document, or deny that it has any further liability under any Loan Document; or

7.13                        Material
Adverse Change.

(i)
Since September 20, 2006 and on or prior to the Credit Date, the Borrower shall
have notified the Lenders of the occurrence of, or there shall have occurred, a
material adverse change in the business, operations, properties or condition
(financial or otherwise) of the Borrower and its Subsidiaries, taken as a
whole, (ii) any representation or warranty made with respect to Mayne Pharma,
its Subsidiaries or their businesses is not true, correct and complete in all
material respects on and as of the relevant date or (iii) any bona fide action,
suit, investigation, litigation or proceeding (whether administrative, judicial
or otherwise) affecting the Borrower or any of its Subsidiaries shall be
pending or threatened against any court, Governmental Authority

 57
 

or arbitrator that
could be reasonably expected to, individually or in the aggregate, materially
impair the transactions contemplated by the Loan Documents or in any manner
call into question or challenge this Agreement or the making of the Loans, and
in each case, 30 days shall have elapsed after the Credit Date;

THEN,
(1) upon the occurrence of any Event of Default described in Section 7.6 or
7.7, automatically, and (2) upon the occurrence of any other Event of Default,
at the request of (or with the consent of) Requisite Lenders, upon notice to
the Borrower by the Administrative Agent, (A) the Commitments, if any, of each
Lender having such Commitments shall immediately terminate; (B) each of the
following shall immediately become due and payable, in each case without presentment,
demand, protest or other requirements of any kind, all of which are hereby
expressly waived by the Borrower:  (I)
the unpaid principal amount of and accrued interest on the Loans and (II) all
other Obligations.

SECTION 8.     MISCELLANEOUS

8.1                               Assignments
and Participations in Loans.

A.                                    Right to Assign.  Each
Lender shall have the right at any time to sell, assign or transfer all or a
portion of its rights and obligations under this Agreement, including all or a
portion of its Commitment or Loans owing to it or other Obligation (provided,
however, that each such assignment shall be of a uniform, and not
varying, percentage of all rights and obligations under and in respect of Loans
and its Commitment):  (i) to any Person
meeting the criteria of clause (A) of the definition of the term of “Eligible
Assignee” or to any Approved Fund upon the giving of notice to the Borrower and
the Administrative Agent; and (ii) to any Person meeting the criteria of clause
(B) of the definition of the term of “Eligible Assignee” and consented to by
each of the Borrower and the Administrative Agent (such consent not to be (x)
unreasonably withheld or delayed and, (y) in the case of the Borrower, required
at any time an Event of Default shall have occurred and then be continuing); provided
further each such assignment pursuant to this Section 8.1A shall be in
an aggregate amount of not less than $5,000,000, which such amount shall be
reduced to $1,000,000 at any time an Event of Default shall have occurred and
be continuing (or such lesser amount as may be agreed to by the Borrower and
the Administrative Agent or as shall constitute the aggregate amount of the
Commitment and Loans of the assigning Lender).

B.                                    Requirements.  The
assigning Lender and the assignee thereof shall execute and deliver to the
Administrative Agent an Assignment Agreement, together with (i) a processing
and recordation fee of $3,500, and (ii) 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 2.8B(iii).

C.                                    Acceptance and Notice of
Assignment.  Upon its receipt of a duly executed and
completed Assignment Agreement, together with the processing and recordation
fee referred to in Section 8.1B (and any forms, certificates or other evidence
required by this Agreement in connection therewith), the Administrative Agent
shall record the information contained in such

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Assignment
Agreement in the Register, shall give prompt notice thereof to the Borrower and
shall maintain a copy of such Assignment Agreement.

D.                                    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 Effective 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 its Commitment or
Loans, as the case may be; and (iii) it will make or invest in, as the case may
be, its Commitment or Loans for its own account in the ordinary course of its
business and without a view to distribution of its Commitment or Loans within
the meaning of the Securities Act or the Exchange Act or other federal
securities laws (it being understood that, subject to the provisions of this
Section 8.1, the disposition of its Commitment or Loans or any interests
therein shall at all times remain within its exclusive control).

E.                                      Effect of Assignment. 
Subject to the terms and conditions of this Section 8.1, 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 8.8) 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 Loan Documents to the contrary notwithstanding
and (y) such assigning Lender shall continue to be entitled to the benefit of
all indemnities hereunder as specified herein with respect to matters arising
out of the prior involvement of such assigning Lender as a Lender hereunder);
(iii) the Commitments shall be modified to reflect the Commitment of such
assignee and any Commitment of such assigning Lender, if any; and (iv) if any
such assignment occurs after the issuance of any Note to the assigning Lender,
the assigning Lender shall, upon the effectiveness of such assignment or as
promptly thereafter as practicable, surrender its Notes to the Administrative
Agent for cancellation, and thereupon the Borrower shall issue and deliver new
Notes, if so requested by the assignee and/or assigning Lender, to such
assignee and/or to such assigning Lender, with appropriate insertions, to
evidence the Loans of the assignee and/or the assigning Lender.

F.                                      Certain Other Permitted
Assignments.  In addition to any other assignment permitted
pursuant to this Section 8.1, any Lender may assign and/or pledge all or any
portion of its Loans, the other obligations owed by or to such Lender, if any,
to secure obligations of such Lender including to 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 that no such assignment or pledge shall release
any Lender from any of its obligations hereunder or substitute any such pledgee
or assignee for such Lender as a party hereto.

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G.                                    Participations.  Each
Lender shall have the right at any time to sell one or more participations to
any Person (other than the Borrower, any of its Subsidiaries or any of its
Affiliates) in all or any part of its Commitment, Loans or other
Obligations.  The holder of any such
participation, other than an Affiliate of the Lender granting such
participation, shall not be entitled to require such Lender to take or omit to
take any action hereunder except with respect to any amendment, modification or
waiver that would (i) extend the final scheduled maturity of any Loan or Note
in which such participant is participating, or reduce the rate or extend the
time of payment of interest or fees thereon (except in connection with a waiver
of applicability of any post default increase in interest rates) or reduce the
principal amount thereof, or increase the amount of the participant’s
participation over the amount thereof then in effect (it being understood that
a waiver of any Event of Default or of a mandatory reduction in the Commitment
shall not constitute a change in the terms of such participation, and that an
increase in any Commitment or Loan shall be permitted without the consent of
any participant if the participant’s participation is not increased as a result
thereof) or (ii) consent to the assignment or transfer by the Borrower of any
of its rights and obligations under this Agreement.  The Borrower agrees that each participant
shall be entitled to the benefits of Sections 2.9C and 2.8 to the same extent
as if it were a Lender and had acquired its interest by assignment pursuant to
Section 8.1A; provided (i) a participant shall not be entitled to
receive any greater payment under Section 2.8 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 the Borrower’s prior written consent and (ii) a participant that would be
a Non-US Lender if it were a Lender shall not be entitled to the benefits of
Section 2.8B unless the Borrower is notified of the participation sold to such
participant and such participant agrees, for the benefit of the Borrower, to
comply with Section 2.8B as though it were a Lender.  To the extent permitted by law, each
participant also shall be entitled to the benefits of Section 8.5 as though it
were a Lender, provided such participant agrees to be subject to Section
8.18 as though it were a Lender.

8.2                               Expenses.

Whether
or not the transactions contemplated hereby shall be consummated, the Borrower
agrees to pay promptly (i) all the actual and reasonable costs and
out-of-pocket expenses of preparation of the Loan Documents; (ii) all the costs
of furnishing all opinions by counsel for the Borrower; (iii) the reasonable
fees, out-of-pocket expenses and disbursements of a single U.S. counsel in
connection with the negotiation, preparation and execution of the Loan
Documents and any other documents or matters requested by the Borrower; (iv)
all the actual and reasonable costs and out-of-pocket reasonable fees, expenses
and disbursements of any auditors, accountants, consultants or appraisers; (v)
all other actual and reasonable costs and out-of-pocket expenses incurred by
each Lead Arranger, the Administrative Agent and each Syndication Agent in
connection with the syndication of the Loans and the negotiation, preparation
and execution of the Loan Documents and the transactions contemplated thereby;
(vi) all actual and reasonable costs and out-of-pocket expenses incurred by the
Administrative Agent in connection with any consents, amendments, waivers or
other modifications of the Loan Documents (including the reasonable fees,
out-of-pocket expenses and disbursements of counsel to the Administrative Agent
in connection therewith); and (vii) after the occurrence of an Event of
Default, all costs and expenses, including reasonable attorneys’ fees
(including, without duplication, allocated costs of internal counsel) and costs
of settlement, incurred by any Agent or Lender in enforcing any Obligations of
or in collecting any payments due from the Borrower

 60
 

hereunder or under
the other Loan Documents by reason of such Event of Default (including in
connection with the sale of, collection from, or other realization upon any
collateral) or in connection with any refinancing or restructuring of the
credit arrangements provided under this Agreement in the nature of a “work-out”
or pursuant to any insolvency or bankruptcy cases or proceedings.

8.3                               Indemnity.

A.                                    In addition to the payment of expenses
pursuant to Section 8.2, whether or not the transactions contemplated hereby
shall be consummated, the Borrower agrees to defend (subject to Indemnitees’
selection of counsel), indemnify, pay and hold harmless each of the Lead
Arrangers and Agents and each Lender, and the respective partners, officers,
directors, employees, agents, attorneys, and affiliates of each of the Lead
Arrangers and each of the Agents and each Lender (collectively called the “Indemnitees”), from and against any and all Indemnified
Liabilities (as hereinafter defined); provided that the Borrower shall
not have any obligation to any Indemnitee hereunder with respect to any
Indemnified Liabilities to the extent such Indemnified Liabilities arise from
the gross negligence or willful misconduct of that Indemnitee or any of its
Affiliates as determined by a final judgment of a court of competent
jurisdiction.  As used herein, “Indemnified Liabilities” means, collectively, any and all
liabilities, obligations, losses, damages (including natural resource damages),
penalties, actions, judgments, suits, claims (including environmental claims),
costs, 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 the Borrower or any other Person, whether or not any such
Indemnitee shall be designated as a party or a potential party thereto, and any
fees or expenses incurred by Indemnitees in enforcing this indemnity), whether
direct, indirect or consequential and whether based on any 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 this Agreement or the other Loan Documents or the
transactions contemplated hereby or thereby (including the Lenders’ agreements
to make the Loans hereunder or the use or intended use of the proceeds thereof,
or any enforcement of any of the Loan Documents).

B.                                    To the extent that the undertakings to
defend, indemnify, pay and hold harmless set forth in this Section 8.3 may be
unenforceable in whole or in part because they are violative of any law or
public policy, the Borrower 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.

C.                                    To the extent permitted by applicable law,
the Borrower and each of its Subsidiaries shall not assert, and each hereby
waives, any claim against the Lenders, the Agents, the Lead Arrangers and their
respective Affiliates, officers, 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, arising out of, as a result
of, or in any way related to, this Agreement or any other Loan Document, or

 61
 

any
agreement or instrument contemplated hereby or thereby or referred to herein or
therein, the transactions contemplated hereby or thereby, any Loan or the use
of the proceeds thereof or any act or omission or event occurring in connection
therewith, and the Borrower and each of its Subsidiaries 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.

8.4                               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 and during the
continuance of any Event of Default, each of the Agents and each Lender (and
each of their respective Affiliates) is hereby authorized by the Borrower at
any time or from time to time subject, except in the case of an Event of
Default under Section 7.1, 7.6 or 7.7, to the consent of the Administrative
Agent (such consent not to be unreasonably withheld or delayed), without notice
to the Borrower or to any other Person, any such notice being hereby expressly
waived, to set-off and to appropriate and to apply any and all deposits
(general or special, including Indebtedness evidenced by certificates of
deposit, whether matured or unmatured, but not including trust accounts) and
any other Indebtedness at any time held or owing by such Agent or such Lender
(or such Affiliate), and any of their respective affiliates, as the case may
be, to or for the credit or the account of the Borrower against and on account
of the obligations and liabilities of the Borrower to such Agent or such Lender
under this Agreement and the other Loan Documents, including all claims of any
nature or description arising out of or connected with this Agreement or any
other Loan Document, irrespective of whether or not (i) such Agent or such Lender
shall have made any demand hereunder or (ii) the principal of or the interest
on the Loans or any other amounts due hereunder shall have become due and
payable pursuant to Section 7 and although said Obligations, or any of them,
may be contingent or unmatured.

8.5                               Amendments
and Waivers.

No
amendment, modification, termination or waiver of any provision of this
Agreement or of any other Loan Document, or consent to any departure by the
Borrower therefrom, shall in any event be effective without the written
concurrence of the Requisite Lenders; provided that no amendment,
modification, termination, waiver or consent shall, without the consent of each
Lender affected thereby:  (i) extend the
scheduled final maturity of any Loan; (ii) waive, reduce or postpone any
scheduled repayment (but not prepayment); (iii) reduce the rate of interest on
any Loan or any fee or other amount hereunder; (iv) extend the time for payment
of any such interest, fees or other amounts; (v) reduce the principal amount of
any Loan; (vi) amend, modify, terminate or waive any provision of this Section
8.5; (vii) amend, modify or replace the definition of “Requisite Lenders” or
“Pro Rata Share”, or any provision of this Agreement which would alter the pro rata sharing of payments required
hereunder; or (viii) consent to the assignment or transfer by the Borrower of
any of its rights and obligations under this Agreement; provided further
that no such amendment, modification, termination or waiver of any provision of
the Loan Documents, or consent to any departure by the Borrower therefrom,
shall:  (1) increase the Commitments of
any Lender over the amount thereof then in effect without the consent of such
Lender; or (2) amend, modify, terminate or waive any provision of this
Agreement as the same applies to the rights or obligations of any Agent, in
each case without the consent of such Agent. 
The Administrative Agent may, but shall have no obligation to, with the 

 62
 

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 the Borrower in any case shall entitle the Borrower to any other or further
notice or demand in similar or other circumstances.

8.6                               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 an Event of
Default or Potential Event of Default if such action is taken or condition
exists.

8.7                               Notices.

A.                                    Generally. 
Unless otherwise specifically provided herein, all notices or other
communications provided for hereunder between the Borrower and any other Person
party hereto shall be in writing (including facsimile or electronic mail) and
mailed, sent by overnight courier, telecopied, e-mailed, or delivered to, in
the case of each signatory to this Agreement, at its address set forth on the
signature pages hereto, or, as to each party, at such other address or to such
other person as shall be designated by such party in a written notice to all
other parties.  Any notice, request or
demand to or upon the Borrower or any other Person party hereto shall not be
effective until received.

B.                                    Intralinks.

(i)                                     The Borrower hereby agree that they will
provide to the Administrative Agent all information, documents and other
materials that they are obligated to furnish to the Administrative Agent
pursuant to the Loan Documents, including all notices, requests, financial
statements, financial and other reports, certificates and other information
materials, but excluding any such communication that (i) relates to a request
for a new, or a conversion of an existing, borrowing or other Loan (including
any election of an interest rate or interest period relating thereto), (ii)
relates to the payment of any principal or other amount due under this
Agreement prior to the scheduled date therefor, (iii) provides notice of any
Potential Event of Default or Event of Default or (iv) is required to be
delivered to satisfy any condition precedent to the effectiveness of this
Agreement and/or any borrowing or other Loan hereunder (all such non-excluded
communications being referred to herein collectively as “Communications”), by transmitting the Communications in an
electronic/soft medium in a format acceptable to the Administrative Agent to
oploanswebadmin@citigroup.com.  In
addition, the Borrower agrees to continue to provide the Communications to the
Administrative Agent in the manner specified in the Loan Documents but only to
the extent requested by the Administrative Agent.

(ii)                                  The Borrower further agrees that the
Administrative Agent may make the Communications available to the Lenders by
posting the Communications on Intralinks or a substantially similar electronic
transmission system (the “Platform”).

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(iii)                            THE PLATFORM IS PROVIDED “AS IS”
AND “AS AVAILABLE”.  THE AGENT PARTIES
(AS DEFINED BELOW) DO NOT WARRANT THE ACCURACY OR COMPLETENESS OF THE
COMMUNICATIONS, OR THE ADEQUACY OF THE PLATFORM AND EXPRESSLY DISCLAIM LIABILITY
FOR ERRORS OR OMISSIONS IN THE COMMUNICATIONS. 
NO WARRANTY OF ANY KIND, EXPRESS, IMPLIED OR STATUTORY, INCLUDING ANY
WARRANTY OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, NON-INFRINGEMENT
OF THIRD PARTY RIGHTS OR FREEDOM FROM VIRUSES OR OTHER CODE DEFECTS, IS MADE BY
THE AGENT PARTIES IN CONNECTION WITH THE COMMUNICATIONS OR THE PLATFORM.  IN NO EVENT SHALL THE ADMINISTRATIVE AGENT OR
ANY OF ITS AFFILIATES OR ANY OF THEIR RESPECTIVE OFFICERS, DIRECTORS,
EMPLOYEES, AGENTS, ADVISORS OR REPRESENTATIVES (COLLECTIVELY, “AGENT PARTIES”)
HAVE ANY LIABILITY TO THE BORROWER, ANY LENDER OR ANY OTHER PERSON OR ENTITY
FOR DAMAGES OF ANY KIND, INCLUDING DIRECT OR INDIRECT, SPECIAL, INCIDENTAL OR
CONSEQUENTIAL DAMAGES, LOSSES OR EXPENSES (WHETHER IN TORT, CONTRACT OR OTHERWISE)
ARISING OUT OF THE BORROWER’S OR THE ADMINISTRATIVE AGENT’S TRANSMISSION OF
COMMUNICATIONS THROUGH THE INTERNET, EXCEPT TO THE EXTENT THE LIABILITY OF ANY
AGENT PARTY IS FOUND IN A FINAL NON-APPEALABLE JUDGMENT BY A COURT OF COMPETENT
JURISDICTION TO HAVE RESULTED PRIMARILY FROM SUCH AGENT PARTY’S GROSS
NEGLIGENCE OR WILLFUL MISCONDUCT.

(iv)                              The Administrative Agent agrees that the
receipt of the Communications by the Administrative Agent at its e-mail address
set forth above shall constitute effective delivery of the Communications to
the Administrative Agent for purposes of the Loan Documents.  Each Lender agrees that notice to it (as
provided in the next sentence) specifying that the Communications have been
posted to the Platform shall constitute effective delivery of the
Communications to such Lender for purposes of the Loan Documents.  Each Lender agrees to notify the
Administrative Agent in writing (including by electronic communication) from
time to time of such Lender’s e-mail address to which the foregoing notice may
be sent by electronic transmission and (ii) that the foregoing notice may be
sent to such e-mail address.

8.8                               Survival
of Representations, Warranties and Agreements.

A.                                    All representations, warranties and
agreements made herein shall survive the execution and delivery of this
Agreement and the making of the Loans hereunder.

B.                                    Notwithstanding anything in this Agreement or
implied by law to the contrary, the agreements of the Borrower set forth in
Sections 2.8, 2.9C, 8.2, 8.3 and 8.4 and the agreements of Lenders set forth in
Sections 8.18, 9.2C and 9.4 shall survive the payment of the Loans and the
termination of this Agreement.

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8.9                               Failure
or Indulgence Not Waiver; Remedies Cumulative.

No
failure or delay on the part of any Lead Arranger, any Agent or any Lender in
the exercise of any power, right or privilege hereunder or under any other Loan
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
Lead Arranger, 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 other Loan Document.  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.

8.10                        Marshalling;
Payments Set Aside.

No
Agent or Lender shall be under any obligation to marshal any assets in favor of
the Borrower or any other Person or against or in payment of any or all of the
Obligations.  To the extent that the
Borrower makes a payment or payments to the Administrative Agent or the Lenders
(or to the Administrative Agent, on behalf of the Lenders) or the
Administrative Agent or the Lenders enforce any security interests or exercises
their rights of set-off, and such payment or payments or the proceeds of such
enforcement or set-off or any part thereof are subsequently invalidated,
declared to be fraudulent or preferential, set aside and/or required to be
repaid to a trustee, receiver or any other party under any bankruptcy law, any
other state or federal law, common law or any equitable cause, then, to the extent
of such recovery, the obligation or part thereof originally intended to be
satisfied, and all Liens, rights and remedies therefor or related thereto,
shall be revived and continued in full force and effect as if such payment or
payments had not been made or such enforcement or set-off had not occurred.

8.11                        Severability.

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

8.12                        Headings.

Section
and subsection headings in this Agreement are included herein for convenience
of reference only and shall not constitute a part of this Agreement for any
other purpose or be given any substantive effect.

8.13                        Applicable
Law.

THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.

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8.14                        Successors
and Assigns.

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 the Lenders (it being understood that each
Lender’s rights of assignment are subject to Section 8.1).  The Borrower may not assign or delegate its
rights or obligations hereunder or any interest therein without the prior written
consent of each Lender.  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, the
Indemnitees, and Affiliates of each of the Agents and the Lenders) any legal or
equitable right, remedy or claim under or by reason of this Agreement.

8.15                        Consent
to Jurisdiction and Service of Process.

ALL JUDICIAL PROCEEDINGS BROUGHT AGAINST THE BORROWER ARISING
OUT OF OR RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT, OR ANY
OBLIGATIONS THEREUNDER, 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,
THE BORROWER, 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 BORROWER AT ITS ADDRESS SET
FORTH ON THE SIGNATURE PAGES HERETO;

(IV)                           AGREES THAT SERVICE AS PROVIDED
IN CLAUSE (III) ABOVE IS SUFFICIENT TO CONFER PERSONAL JURISDICTION OVER THE
BORROWER IN ANY SUCH PROCEEDING IN ANY SUCH COURT, AND OTHERWISE CONSTITUTES
EFFECTIVE AND BINDING SERVICE IN EVERY RESPECT;

(V)                               AGREES THAT EACH AGENT AND EACH
LENDER RETAINS THE RIGHT TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY LAW
OR TO BRING PROCEEDINGS AGAINST THE BORROWER IN THE COURTS OF ANY OTHER
JURISDICTION; AND

(VI)                           AGREES THAT THE PROVISIONS OF
THIS SECTION 8.15 RELATING TO JURISDICTION AND VENUE SHALL BE BINDING AND
ENFORCEABLE TO THE FULLEST EXTENT PERMISSIBLE UNDER NEW YORK GENERAL
OBLIGATIONS LAW SECTION 5-1402 OR OTHERWISE.

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8.16                        Waiver
of Jury Trial.

EACH OF THE PARTIES TO THIS AGREEMENT HEREBY AGREES TO WAIVE
ITS RESPECTIVE RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED
UPON OR ARISING OUT OF THIS AGREEMENT OR ANY OF THE OTHER LOAN 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 their 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 8.16 AND EXECUTED BY EACH
OF THE PARTIES HERETO), AND THIS WAIVER SHALL APPLY TO ANY SUBSEQUENT
AMENDMENTS, RENEWALS, SUPPLEMENTS OR MODIFICATIONS TO THIS AGREEMENT OR ANY OF
THE OTHER LOAN 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.

8.17                        Confidentiality.

Each
Agent and Lender shall hold all confidential, proprietary or non-public
information regarding the Borrower and its Subsidiaries and their respective
businesses which has been identified as confidential by any the Borrower and
obtained pursuant to the requirements of this Agreement in accordance with such
Agent’s or Lender’s customary procedures for handling confidential information
of this nature and in accordance with safe and sound banking practices, it
being understood and agreed by the Borrower that in any event each Lender may
make disclosures (i) to Affiliates of such Agent or Lender and the directors,
officers, employees, agents, advisors and other representatives of such Agent
or Lender and their Affiliates (and to other persons authorized by an Agent or
Lender to organize, present or disseminate such information in connection with
disclosures otherwise made in accordance with this Section 8.17); (ii)
reasonably required by any bona fide or potential assignee, transferee or participant
in connection with the contemplated assignment, transfer or participation by
any Lender of its Loans or any interest therein; (iii) to any rating agency
when required by it, provided that, prior to any disclosure, such rating
agency shall undertake in writing to preserve the confidentiality of any
confidential information relating to the Borrower or its Subsidiaries received
by it from any of the Agents or any Lender; (iv) required or requested by any
Governmental Authority or representative thereof; provided that unless
specifically prohibited by applicable law, court order or similar regulatory
process, each Agent and Lender shall make reasonable efforts to notify the
Borrower of any request by any Governmental Authority or representative thereof
(other than

 67
 

any such request
in connection with any examination of the financial condition or other routine
examination of such Agent or Lender by such Governmental Authority) for
disclosure of any such non-public information prior to disclosure of such information;
(v) to any other party hereto; (vi) in connection with the exercise of any
remedies hereunder or under any other Loan Document or any action or proceeding
relating to this Agreement or any other Loan Document or the enforcement of
rights hereunder or thereunder; (vii) to any actual or prospective counterparty
(or its advisors) to any swap or derivative transaction relating to the
Borrower and their Obligations; (viii) with the consent of the Borrower or (ix)
to the extent such information (x) becomes publicly available other than as a
result of a breach of this Section 8.17 or (y) becomes available to any Agent,
any Lender or their respective Affiliates on a nonconfidential basis from a
source other than the Borrower so long as such Agent, such Lender or such
Affiliate does not have knowledge that such source has an obligation to the
Borrower to keep such information confidential; provided that in no
event shall any Agent or Lender be obligated or required to return any
materials furnished by the Borrower or any of its Subsidiaries.

8.18                        Ratable
Sharing.

The
Lenders hereby agree among themselves that if any of them shall, whether by
voluntary payment (other than a voluntary prepayment of Loans made and applied
in accordance with the terms hereof), through the exercise of any right of
set-off or banker’s lien, by counterclaim or cross action or by the enforcement
of any right under the Loan 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, amounts payable in respect of commitment fees and other amounts then
due and owing to such Lender hereunder or under the other Loan Documents
(collectively, the “Aggregate Amounts Due”
to such Lender), which is greater than the proportion received by any other
Lender in respect to of the Aggregate Amounts Due to such other Lender, then
the Lender receiving such proportionately greater payment shall (i) notify the
Administrative Agent of the receipt of such payment and (ii) apply a portion of
such payment to purchase (for cash at face value) 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),
or such other adjustments as shall be equitable, 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 the Borrower or otherwise, those purchases shall be
rescinded and the purchase prices paid for such participations shall be
returned to such purchasing Lender ratably to the extent of such recovery, but
without interest.  The Borrower and each
of its Subsidiaries expressly consents to the foregoing arrangement and agrees
that any holder of a participation so purchased may exercise any and all rights
of banker’s lien, set-off or counterclaim with respect to any and all monies
owing by the Borrower or any of its Subsidiaries to that holder with respect
thereto as fully as if that holder were owed the amount of the participation
held by that holder.

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8.19                        Counterparts;
Effectiveness.

This
Agreement and any amendments, waivers, consents or supplements hereto or in
connection herewith 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.  This Agreement shall become effective upon
the execution of a counterpart hereof by each of the parties hereto and receipt
by the Administrative Agent of written or telephonic notification of such
execution and authorization of delivery thereof.

8.20                        Obligations
Several; Independent Nature of Lenders’ Rights.

The
obligations of the Lenders hereunder are several and no Lender shall be
responsible for the obligations or Commitment of any other Lender
hereunder.  Nothing contained herein or
in any other Loan Document, and no action taken by the Lenders pursuant hereto
or thereto, shall be deemed to constitute the 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.

8.21                        Usury
Savings Clause.

Notwithstanding
any other provision herein, the aggregate interest rate charged 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.  As used herein, “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.  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 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
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 the 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 the 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 Loans made hereunder or be refunded to the Borrower.

 69
 

SECTION 9.     AGENTS

9.1                               Appointment.

ABN
AMRO and MSSF are hereby appointed as Syndication Agents hereunder, and each Lender
hereby authorizes the Syndication Agents to act as its agents in accordance
with the terms of this Agreement and the other Loan Documents.  Citicorp is hereby appointed by each Lender
as the Administrative Agent hereunder and under the other Loan Documents and
each Lender hereby authorizes the Administrative Agent to act as its agent in
accordance with the terms of this Agreement and the other Loan Documents.  Each Agent hereby agrees to act upon the
express conditions contained in this Agreement and the other Loan Documents, as
applicable.  The provisions of this
Section 9 are solely for the benefit of the Agents and the Lenders, and the
Borrower shall have no rights as a third party beneficiary of any of the provisions
thereof.  In performing its functions and
duties under this Agreement, each of the Agents shall act solely as an agent of
the Lenders and does not assume and shall not be deemed to have assumed any
obligation towards or relationship of agency or trust with or for the Borrower
or any of its Subsidiaries.

9.2                               Powers
and Duties; General Immunity.

A.                                    Powers; Duties Specified.  Each
Lender irrevocably authorizes each Agent to take such action on such Lender’s
behalf and to exercise such powers, rights and remedies hereunder and under the
other Loan Documents as are specifically delegated or granted to such Agent by
the terms hereof and thereof, together with such powers, rights and remedies as
are reasonably incidental thereto.  Each
Agent shall have only those duties and responsibilities that are expressly
specified in this Agreement and the other Loan Documents.  Each Agent may exercise such powers, rights
and remedies and perform such duties by or through its agents or employees.  No Agent shall have, by reason of this
Agreement or any of the other Loan Documents, a fiduciary relationship in
respect of any Lender; and nothing in this Agreement or any of the other Loan
Documents, expressed or implied, is intended to or shall be so construed as to
impose upon any Agent any obligations in respect of this Agreement or any of
the other Loan Documents except as expressly set forth herein or therein.  Anything herein to the contrary
notwithstanding, none of the Lead Arrangers or Syndication Agents listed on the
cover page hereof shall have any powers, duties or responsibilities under this
Agreement or any of the other Loan Documents, except in its capacity, as a
Lender hereunder.

B.                                    No Responsibility for Certain
Matters.  No Agent shall be responsible to any Lender
for the execution, effectiveness, genuineness, validity, enforceability,
collectability or sufficiency of this Agreement or any other Loan Document or
for any representations, warranties, recitals or statements made herein or
therein or made in any written or oral statements or in any financial or other
statements, instruments, reports or certificates or any other documents
furnished or made by any Agent to the Lenders or by or on behalf of the
Borrower to any Agent or any Lender in connection with the Loan Documents and
the transactions contemplated thereby or for the financial condition or
business affairs of the Borrower or any other Person liable for the payment of
any Obligations, nor shall any Agent be required to

 70
 

ascertain
or inquire as to the performance or observance of any of the terms, conditions,
provisions, covenants or agreements contained in any of the Loan Documents
(other than to confirm receipt of items required under this Agreement or any
Loan Document to be delivered to such Agent) or as to the use of the proceeds
of the Loans or as to the existence or possible existence of any Event of
Default or Potential Event of Default (unless and until notice describing such
Event of Default or Potential Event of Default is given to such Agent by the
Borrower or any other Agent) or to make disclosures with respect to the
foregoing.  Anything contained in this
Agreement to the contrary notwithstanding, the Administrative Agent shall not
have any liability arising from confirmations of the amount of outstanding
Loans or the component amounts thereof.

C.                                    Exculpatory Provisions.  No
Agent or any of its officers, partners, directors, employees or agents shall be
liable to the Lenders for any action taken or omitted by any Agent under or in
connection with any of the Loan Documents except to the extent caused by such
Agent’s gross negligence or willful misconduct. 
Each Agent shall be entitled to refrain from any act or the taking of
any action (including the failure to take an action) in connection with this
Agreement or any of the other Loan Documents or from the exercise of any power,
discretion or authority vested in it hereunder or thereunder unless and until
such Agent shall have received instructions in respect thereof from the
Requisite Lenders (or such other the Lenders as may be required to give such
instructions under Section 8.5) and, upon receipt of such instructions from the
Requisite Lenders (or such other Lenders, as the case may be), such Agent shall
be entitled to act or (where so instructed) refrain from acting, or to exercise
such power, discretion or authority, in accordance with such instructions.  Without prejudice to the generality of the
foregoing, (i) each of Agent shall be entitled to rely, and shall be fully
protected in relying, upon any communication, instrument or document believed
by it to be genuine and correct and to have been signed or sent by the proper
Person or Persons, and shall be entitled to rely and shall be protected in
relying on opinions and judgments of attorneys (who may be attorneys for the
Borrower and its Subsidiaries), accountants, experts and other professional
advisors selected by it; and (ii) no Lender shall have any right of action
whatsoever against any Agent as a result of such Agent acting or (where so
instructed) refraining from acting under this Agreement or any of the other
Loan Documents in accordance with the instructions of the Requisite Lenders (or
such other Lenders as may be required to give such instructions under Section
8.5).

D.                                    Agents Entitled to Act as
Lenders.  The agency hereby created shall in no way
impair or affect any of the rights and powers of, or impose any duties or
obligations upon, any Agent in its individual capacity as a Lender
hereunder.  With respect to its
participation in the Loans, each Agent shall have the same rights and powers
hereunder as any other Lender and may exercise the same as though it were not
performing the duties and functions delegated to it hereunder, and the term
“Lender” shall, unless the context clearly otherwise indicates, include each
Agent in its individual capacity.  Any
Agent and its Affiliates may accept deposits from, lend money to, own
Securities of, and generally engage in any kind of banking, trust, financial
advisory or other business with the Borrower or any of their Affiliates as if
it were not performing the duties specified herein, and may accept fees and
other consideration from the Borrower for services in connection with this
Agreement and otherwise without having to account for the same to Lenders.  No Agent shall have any duty to disclose any
information obtained or received by it or any of its Affiliates relating to the
Borrower or any of its Subsidiaries to the extent such information was obtained
or received in any capacity other than

 71
 

as
an Agent under this Agreement.  In the
event that Citicorp or any of its Affiliates shall be or become an indenture
trustee under the Trust Indenture Act of 1939 (as amended, the “Trust Indenture Act”) in respect of any securities issued or
guaranteed by the Borrower, the parties hereto acknowledge and agree that any
payment or property received in satisfaction of or in respect of any obligation
of the Borrower hereunder or under any other Loan Document by or on behalf of
Citicorp in its capacity as the Administrative Agent for the benefit of any
Lender under this Agreement or any Note (other than Citicorp or an Affiliate of
Citicorp) and which is applied in accordance with this Agreement shall be
deemed to be exempt from the requirements of Section 311 of the Trust Indenture
Act pursuant to Section 311(b)(3) of the Trust Indenture Act.

9.3                               Representations
and Warranties; No Responsibility For Appraisal of Creditworthiness.

Each
Lender represents and warrants that it has made its own independent
investigation of the financial condition and affairs of the Borrower and its
Subsidiaries in connection with the making of the Loans hereunder and that it
has made and shall continue to make its own appraisal of the creditworthiness
of the Borrower and its Subsidiaries.  No
Agent shall have any duty or responsibility, either initially or on a
continuing basis, to make any such investigation or any such appraisal on
behalf of the Lenders or to provide any Lender with any credit or other
information with respect thereto, whether coming into its possession before the
making of the Loans or at any time or times thereafter, and no Agent shall have
any responsibility with respect to the accuracy of or the completeness of any
information provided to the Lenders.

9.4                               Right
to Indemnity.

Each
Lender, in proportion to its Pro Rata Share, severally agrees to indemnify the
Administrative Agent, to the extent that the Administrative Agent shall not
have been reimbursed by the Borrower to the full extent required by this
Agreement or any other Loan Document, for and against any and all liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses (including counsel fees and disbursements) or disbursements of any
kind or nature whatsoever which may be imposed on, incurred by or asserted against
such Agent in exercising its powers, rights and remedies or performing its
duties hereunder or under the other Loan Documents or otherwise in its capacity
as Administrative Agent in any way relating to or arising out of this Agreement
or the other Loan Documents; provided that (a) no Lender shall be liable
for any portion of such liabilities, obligations, losses, damages, penalties,
actions, judgments, suits, costs, expenses or disbursements resulting from the
Administrative Agent’s gross negligence or willful misconduct and (b) no Lender
shall be liable for the payment of any portion of an Indemnified Liability
pursuant to this Section 9.4 unless such Indemnified Liability was incurred by
the Administrative Agent in its capacity as such or by another Person acting
for the Administrative Agent in such capacity. 
If any indemnity furnished to the Administrative Agent for any purpose
shall, in the opinion of the Administrative Agent, be insufficient or become
impaired, the Administrative Agent may call for additional indemnity and cease,
or not commence, to do the acts indemnified against until such additional
indemnity is furnished.

 72
 

9.5                               Successor
Administrative Agent.

The
Administrative Agent may resign at any time by giving thirty (30) days’ prior
written notice thereof to the Lenders and the Borrower, and the Administrative
Agent may be removed at any time with or without cause by an instrument or
concurrent instruments in writing delivered to the Borrower and the
Administrative Agent and signed by the Requisite Lenders.  Upon any such notice of resignation or any
such removal, the Requisite Lenders shall have the right, with, so long as no
Potential Event of Default or Event of Default exists, the consent of the
Borrower (which consent shall not be unreasonably withheld or delayed), upon
five (5) Business Days’ notice to the Borrower, to select a successor
Administrative Agent.  Upon the
acceptance of any appointment as Administrative Agent hereunder by a successor
Administrative Agent, that successor Administrative Agent shall thereupon
succeed to and become vested with all the rights, powers, privileges and duties
of the retiring or removed Administrative Agent and the retiring or removed
Administrative Agent shall be discharged from its duties and obligations under
this Agreement.  After any retiring or
removed Administrative Agent’s resignation or removal hereunder as
Administrative Agent, the provisions of this Section 9 shall inure to its
benefit as to any actions taken or omitted to be taken by it while it was the
Administrative Agent under this Agreement.

9.6                               Acknowledgment
of Potential Related Transactions.

The
Borrower hereby acknowledge its understanding that each of the Lead Arrangers,
each of the Agents and each of the Lenders may from time to time effect
transactions (for its own account or the account of customers), and hold
positions in loans or options on loans that may be the subject of this
arrangement.  In addition, certain
Affiliates of the Lenders are full service securities firms and as such may
from time to time effect transactions (for its own account or the account of
customers), and hold positions, in loans or options on loans or securities or
options on securities that may be the subject of this arrangement.  In addition, each of the Lead Arrangers, each
of the Agents and each of the Lenders may employ the services of its Affiliates
in providing certain services hereunder and may, subject to Section 8.17,
exchange with such Affiliates information concerning the Borrower and other companies
that may be the subject of this arrangement.

[Remainder
of page intentionally left blank]

 73

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.

	
   

  	
  HOSPIRA,
  INC.

  	 

	 
	
   

  	
   

  
	 
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Lori O. Carlson

  	
   

  	 

	
   

  	
  Name: Lori O. Carlson

  	 

	 
	
   

  	
  Title: Corporate Vice President and Treasurer

  
	 
	
   

  	
   

  
	 
	
   

  	
   

  
	 
	
   

  	
  Notice Address:

  
	 
	
   

  	
   

  
	 
	
   

  	
  275 N. Field Road

  
	 
	
   

  	
  Lake Forest, IL 60064

  
	 
	
   

  	
  Attention: 
  Vice President and Treasurer

  
	
   

  	
  Tel:

  	
  (224) 212-2000

  	 

	 
	
   

  	
  Fax:

  	
  (224) 212-3284

  
	
   

  	
  email: lori.carlson@hospira.com

  	 

								

 

 

	
  

  	
  CITICORP NORTH AMERICA, INC.,

  	
   

  
	
   

  	
  as Lender and Administrative Agent

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Kevin A. Ege

  	
   

  
	
   

  	
  Name: Kevin A. Ege

  
	
   

  	
  Title: Vice President

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Notice Address:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Two Penns Way

  	
   

  
	
   

  	
  New Castle, DE 19720

  
	
   

  	
  Attention: Bank Loan Syndications

  
	
   

  	
  Tel:

  	
  (302) 894-6010

  
	
   

  	
  Fax:

  	
  (212) 994-0961

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  with a copy to:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  390 Greenwich Street

  	
   

  
	
   

  	
  New York, NY 10013

  	
   

  
	
   

  	
  Attention:  Chris
  Snider

  
	
   

  	
  Tel:

  	
  (212) 816-8917

  
	
   

  	
  Fax:

  	
  (212) 816-8051

  
	
   

  	
  email: christopher.snider@citigroup.com

  
							

 

 2
 

 

	
   

  	
  ABN
  AMRO BANK N.V., as Lender

  
	 
	
   

  	
   

  
	 
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Gina Brusatori

  	
   

  
	
   

  	
  Name: Gina Brusatori

  
	 
	
   

  	
  Title: Managing Director

  
	 
	
   

  	
   

  
	 
	
   

  	
   

  
	 
	
   

  	
   

  
	
   

  	
  By:  

  	
  /s/ James W. Pierpont

  	
   

  
	
   

  	
  Name: James W. Pierpont

  
	 
	
   

  	
  Title: Corporate Managing Director

  
	 
	
   

  	
   

  
	 
	
   

  	
   

  
	 
	
   

  	
  Notice Address:

  
	 
	
   

  	
   

  
	 
	
   

  	
  540 West Madison Street, Suite 2100

  
	 
	
   

  	
  Chicago, IL 
  60661

  
	 
	
   

  	
  Attention:  Loan
  Administration

  
	
   

  	
  Tel:

  	
  (312) 992-5150

  
	 
	
   

  	
  Fax:

  	
  (312) 992-5155

  
									

 

 3
 

 

	
   

  	
  BANK
  OF AMERICA, N.A., as Lender

  
	 
	
   

  	
   

  
	 
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Kevin R. Wagley

  	
   

  
	
   

  	
  Name: Kevin R. Wagley

  
	 
	
   

  	
  Title: Senior Vice President

  
	 
	
   

  	
   

  
	 
	
   

  	
   

  
	 
	
   

  	
  Notice Address:

  
	 
	
   

  	
   

  
	 
	
   

  	
  1850 Gateway Blvd.

  
	 
	
   

  	
  Concord, CA 
  94520-3282

  
	 
	
   

  	
  Attention:  Pamela
  S.  Greer-Tillman

  
	
   

  	
  Tel:

  	
  (925) 675-8453

  
	 
	
   

  	
  Fax:

  	
  (888) 969-2786

  
	
   

  	
  email: 

  
								

 

 4
 

 

	 
	
   

  	
  MORGAN
  STANLEY SENIOR FUNDING, INC., as 

  
	 
	
   

  	
  Lender

  
	 
	
   

  	
   

  
	 
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Elizabeth Hendricks

  	
   

  
	
   

  	
  Name: Elizabeth Hendricks

  
	 
	
   

  	
  Title: Vice President

  
	 
	
   

  	
   

  
	 
	
   

  	
   

  
	 
	
   

  	
  Notice Address:

  
	 
	
   

  	
   

  
	 
	
   

  	
  1633 Broadway, 25th Floor

  
	 
	
   

  	
  New York, NY 
  10019

  
	 
	
   

  	
  Attention: 
  James Morgan/Larry Benison

  
	
   

  	
  Tel:

  	
  (212) 537-1470 / (212) 537-1439

  
	 
	
   

  	
  Fax:

  	
  (212) 537-1867 / 1866

  
	
   

  	
  email: 

  
								

 

 5
 

 

	 
	
   

  	
  WACHOVIA
  BANK, NATIONAL ASSOCIATION, as

  
	 
	
   

  	
  Lender

  
	 
	
   

  	
   

  
	 
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ James S. Conville

  	
   

  
	
   

  	
  Name: James S. Conville

  
	 
	
   

  	
  Title: Assistant Vice President

  
	 
	
   

  	
   

  
	 
	
   

  	
   

  
	 
	
   

  	
  Notice Address:

  
	 
	
   

  	
   

  
	 
	
   

  	
  201 South College Street CP9, NC 1183

  
	 
	
   

  	
  Charlotte, NC 
  28288

  
	 
	
   

  	
  Attention: 
  Dianne Taylor

  
	
   

  	
  Tel:

  	
  (704) 715-1876

  
	 
	
   

  	
  Fax:

  	
  (704) 715-0094

  
	
   

  	
  email: 

  
								

 

 6Exhibit 4.1

 

THIS
SECURITY IS A GLOBAL SECURITY WITHIN THE MEANING OF THE INDENTURE HEREINAFTER
REFERRED TO AND IS REGISTERED IN THE NAME OF A DEPOSITARY OR A NOMINEE
THEREOF.  THIS SECURITY MAY NOT BE
EXCHANGED IN WHOLE OR IN PART FOR A SECURITY REGISTERED, AND NO TRANSFER OF
THIS SECURITY IN WHOLE OR IN PART MAY BE REGISTERED, IN THE NAME OF ANY PERSON
OTHER THAN SUCH DEPOSITARY OR A NOMINEE THEREOF, EXCEPT IN THE LIMITED
CIRCUMSTANCES DESCRIBED IN THE INDENTURE.

UNLESS
THIS SECURITY IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY
TRUST COMPANY, A NEW YORK CORPORATION (“DTC”) TO THE ISSUER OR ITS AGENT FOR
REGISTRATION OR TRANSFER, EXCHANGE OR PAYMENT, AND ANY SECURITY ISSUED IS
REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED
BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE &
CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF
DTC) ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO
ANY PERSON IS WRONGFUL, INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE &
CO., HAS AN INTEREST HEREIN.

 

 

HEWLETT-PACKARD
COMPANY

Floating Rate Global Notes due March 1, 2012

	
  No.

  	
  $

  	
   

  

CUSIP
No. 428236
AK 9

Hewlett-Packard Company,
a corporation duly organized and existing under the laws of Delaware (herein
called the “Company,” which term includes any successor Person under the
Indenture hereinafter referred to), for value received, hereby promises to pay
to                     ,
or registered assigns, the principal sum of               
Dollars ($                 )
or such other amount indicated on the Schedule of Exchange of Global Notes
attached hereto on March 1, 2012 (if such date is not a Business Day,
payment of principal, premium, if any, and interest for the Securities will be
paid on the next Business Day; provided, however, that no interest on that
payment will accrue from and after March 1, 2012), and to pay interest thereon
from February 27, 2007, or from the most recent Interest Payment Date to which
interest has been paid or duly provided for, quarterly on March1, June 1,
September 1 and December 1 of each year (each an “Interest Payment Date”),
commencing June 1, 2007 as described on the reverse of this Security, until the
principal hereof is paid or made available for payment.  The interest so payable, and punctually paid
or duly provided for, on any Interest Payment Date will, as provided in such
Indenture, be paid to the Person in whose name this Security (or one or more
Predecessor Securities) is registered at the close of business on the Regular
Record Date for such interest, which shall be the Business Day preceding the
Interest Payment Date.  Any such interest
not so punctually paid or duly provided for will forthwith cease to be payable
to the Holder on such Regular Record Date and may either be paid to the Person
in whose name this Security (or one or more Predecessor Securities) is
registered at the close of business on a Special Record Date for the payment of
such Defaulted Interest to be fixed by the Trustee, notice whereof shall be
given to Holders of Securities of this series not less than 10 days prior to
such Special Record Date, or be paid at any time in any other lawful manner not
inconsistent with the requirements of any securities exchange on which the
Securities of this series may be listed, and upon such notice as may be
required by such exchange, all as more fully provided in said Indenture.

So long as all of the Securities of this series are
represented by Global Securities, the principal of, premium, if any, and
interest, if any, on this Global Security shall be paid in same day funds to
the Depositary, or to such name or entity as is requested by an authorized
representative of the Depositary.  If at
any time the Securities of this series are no longer represented by the Global
Securities and are issued in definitive form (“Certificated Securities”), then
the principal of, premium, if any, and interest, if any, on each Certificated
Security at Maturity shall be paid to the Holder upon surrender of such
Certificated Security at the office or agency maintained by the Company in the
Borough of Manhattan, The City of New York (which shall initially be the
principal corporate trust office of The Bank of New York Trust Company, N.A.,
as Trustee) or at such other place or places as may be designated in or
pursuant to the Indenture, provided that such Certificated Security is
surrendered to the Trustee, acting as Paying Agent, in time for the Paying
Agent to make such payments in such funds in accordance with its normal
procedures.  Payments of interest with
respect to Certificated Securities other than at Maturity may, at the option of
the Company, be made by check mailed to the address of the Person entitled
thereto as it appears on the Security Register on 

 

 

the relevant Regular or Special Record Date or by wire
transfer in same day funds to such account as may have been appropriately
designated to the Paying Agent by such Person in writing not later than such
relevant Regular or Special Record Date.

Reference is hereby made to the further provisions of
this Security set forth on the reverse hereof, which further provisions shall
for all purposes have the same effect as if set forth at this place.

Unless the certificate of authentication hereon has
been executed by the Trustee referred to on the reverse hereof by manual
signature, this Security shall not be entitled to any benefit under the
Indenture or be valid or obligatory for any purpose.

 

 

IN WITNESS
WHEREOF, the Company has caused this instrument to be duly executed.

	
  

  	
   

  	
  HEWLETT-PACKARD COMPANY

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  Catherine A. Lesjak

  
	
   

  	
   

  	
   

  	
   

  	
  Executive Vice President and Chief Financial Officer

  
	
   

  	
   

  	
   

  	
   

  
	
  Attest:

  	
   

  	
   

  	
   

  
	
   

  	
  Charles N. Charnas

  	
   

  	
   

  
	
   

  	
  Vice President, Deputy General Counsel and Assistant
  Secretary

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Trustee’s Certificate of Authentication.

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  This is one of the Securities of the series
  designated herein referred to in the within-mentioned Indenture. 

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Dated:

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  THE BANK OF NEW YORK TRUST

  	
   

  	
   

  
	
  COMPANY, N.A., as Trustee

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
   

  
	
   

  	
  Authorized Signatory

  	
   

  	
   

  

 

 

Reverse
of Security

This Security is one of a duly authorized issue of
securities of the Company (herein called the “Securities”), issued and to be
issued in one or more series under an Indenture, dated as of June 1, 2000
(herein called the “Indenture,” which term shall have the meaning assigned to
it in such instrument), between the Company and The Bank of New York Trust
Company, N.A. (as successor to J.P. Morgan Trust Company, National Association,
as successor to Chase Manhattan Bank and Trust Company, National Association),
as trustee (herein called the “Trustee,” which term includes any successor
Trustee under the Indenture), and reference is hereby made to the Indenture and
all indentures supplemental thereto for a statement of the respective rights,
limitations of rights, duties and immunities thereunder of the Company, the
Trustee and the Holders of the Securities and of the terms upon which the
Securities are, and are to be, authenticated and delivered.  This Security is one of the series designated
on the face hereof initially limited in aggregate principal amount to $                  .

This Security will bear interest for each interest
period at a rate determined by the calculation agent, which shall initially be
The Bank of New York Trust Company, N.A. until such time as the Company
appoints a successor calculation agent (herein called the “Calculation Agent,”
which term includes any successor Calculation Agent under the Indenture).  The interest rate on the Securities for a
particular Interest Period (as defined below) will be a per annum rate equal to
three-month USD LIBOR (as defined below) as determined on the Interest
Determination Date plus 0.11% (the “Interest Rate”).  The “Interest Determination Date” for an
Interest Period will be the second London Business Day preceding the first day
of such Interest Period.  Promptly upon
determination, the Calculation Agent will inform the Trustee and the Company of
the Interest Rate for the next Interest Period. 
Absent manifest error, the determination of the Interest Rate by the
Calculation Agent shall be binding and conclusive on the holders of this
Security, the Trustee and the Company.  A
London Business Day is a day on which dealings in deposits in U.S. dollars are
transacted in the London interbank market.

Interest on the Securities will be paid to but
excluding the relevant Interest Payment Date. 
Interest payments on the Securities will be made quarterly in arrears on
the Interest Payment Date, beginning on June 1, 2007, to the person in whose
name this Security is registered at the close of business on the Business Day
immediately preceding the Interest Payment Date.  Interest on this Security will accrue from
and including February 27, 2007, to but excluding the first Interest Payment
Date and then from and including the immediately preceding Interest Payment
Date to which interest has been paid or duly provided for to but excluding the
next Interest Payment Date or date of Maturity, as the case may be (each of
these periods is referred to as an “Interest Period”).  The amount of accrued interest that the
Company will pay for any Interest Period shall be calculated by the Calculation
Agent by multiplying the face amount of the Securities then outstanding by an
Accrued Interest Factor.  This Accrued
Interest Factor is computed by adding the Interest Factor calculated for each
day from February 27, 2007, or from the latest date interest was paid to the date
for which accrued interest is being calculated. 
The “Interest Factor” for each day is computed by dividing the Interest
Rate applicable to that date by 360.  If
an Interest Payment Date for the Securities falls on a day that is not a
Business Day, the Interest Payment Date shall be postponed to the next
succeeding Business Day unless such next succeeding Business Day would be in
the following month, in which case, the Interest Payment Date shall be the
immediately preceding Business Day.

 

 

On any Interest Determination Date, “LIBOR” will be
equal to the offered rate for deposits in U.S. dollars having an index maturity
of three months, in amounts of at least $1,000,000, as such rate appears on “Telerate
Page 3750” at approximately 11:00 a.m., London time, on such Interest
Determination Date.  If on an Interest
Determination Date, such rate does not appear on the “Telerate Page 3750” as of
11:00 a.m., London time, or if the “Telerate Page 3750” is not
available on such date, the Calculation Agent will obtain such rate from
Bloomberg L.P.’s page “BBAM.”  If no
offered rate appears on “Telerate Page 3750” or Bloomberg L.P.’s page “BBAM”
on an Interest Determination Date at approximately 11:00 a.m., London
time, then the calculation agent (after consultation with the Company) will
select four major banks in the London interbank market and shall request each
of their principal London offices to provide a quotation of the rate at which
three-month deposits in U.S. dollars in amounts of at least $1,000,000 are offered
by it to prime banks in the London interbank market, on that date and at that
time, that is representative of single transactions at that time. If at least
two quotations are provided, LIBOR will be the arithmetic average of the
quotations provided.  Otherwise, the
Calculation Agent will select three major banks in New York City and shall
request each of them to provide a quotation of the rate offered by them at
approximately 11:00 a.m., New York City time, on the Interest
Determination Date for loans in U.S. dollars to leading European banks having
an index maturity of three months for the applicable interest period in an
amount of at least $1,000,000 that is representative of single transactions at
that time.  If three quotations are
provided, LIBOR will be the arithmetic average of the quotations provided.  Otherwise, the rate of LIBOR for the next
Interest Period will be set equal to the rate of LIBOR for the then current
Interest Period.

Upon request from any holder of Securities, the
Calculation Agent will provide the Interest Rate in effect for the Securities
for the current Interest Period and, if it has been determined, the Interest
Rate to be in effect for the next Interest Period.

All percentages resulting from any calculation of the
Interest Rate on the Securities will be rounded to the nearest one
hundred-thousandth of a percentage point with five one millionths of a
percentage point rounded upwards (e.g., 9.876545% (or .09876545) would be
rounded to 9.87655% (or .0987655)), and all dollar amounts used in or resulting
from such calculation on the Securities will be rounded to the nearest cent
(with one-half cent being rounded upward). 
Each calculation of the Interest Rate on the Securities by the Calculation
Agent will (in the absence of manifest error) be final and binding on the
Holders and the Company.

The Interest Rate on the Securities will in no event
be higher than the maximum permitted rate by New York law as the same may be
modified by Unites States law of general application.

The Securities may not be redeemed by the Company prior to Maturity.

The Indenture contains provisions, which will apply to
the Securities, for defeasance and covenant defeasance and Events of Default
with respect to this Security, in each case upon compliance with certain
conditions set forth in the Indenture.

If an Event of Default with respect to Securities of
this series shall occur and be continuing, the principal of the Securities of
this series may be declared due and payable in the manner and with the effect
provided in the Indenture.

 

 

The Indenture permits, with certain exceptions as
therein provided, the amendment thereof and the modification of the rights and
obligations of the Company and the rights of the Holders of the Securities of
each series to be affected under the Indenture at any time by the Company and
the Trustee with the consent of the Holders of more than 50% in aggregate
principal amount of the Securities at the time Outstanding of each series to be
affected.  The Indenture also contains provisions
permitting the Holders of specified percentages in principal amount of the
Securities of each series at the time Outstanding, on behalf of the Holders of
all Securities of such series, to waive compliance by the Company with certain
provisions of the Indenture and certain past defaults under the Indenture and
their consequences.  Any such consent or
waiver by the Holder of this Security shall be conclusive and binding upon such
Holder and upon all future Holders of this Security and of any Security issued
upon the registration of transfer hereof or in exchange herefor or in lieu
hereof, whether or not notation of such consent or waiver is made upon this
Security.

As provided in and subject to the provisions of the
Indenture, the Holder of this Security shall not have the right to institute
any proceeding with respect to the Indenture or for the appointment of a
receiver or Trustee or for any other remedy thereunder, unless such Holder
shall have previously given the Trustee written notice of a continuing Event of
Default with respect to the Securities of this series, the Holders of not less
than 25% in principal amount of the Securities of this series at the time
Outstanding shall have made written request to the Trustee to institute
proceedings in respect of such Event of Default as Trustee and offered the
Trustee reasonable indemnity, and the Trustee shall not have received from the
Holders of a majority in principal amount of Securities of this series at the
time Outstanding a direction inconsistent with such request, and shall have
failed to institute any such proceeding, for 60 days after receipt of such
notice, request and offer of indemnity. 
The foregoing shall not apply to any suit instituted by the Holder of
this Security for the enforcement of any payment of principal hereof or any
premium or interest hereon on or after the respective due dates expressed
herein.

No reference herein to the Indenture and no provision
of this Security or of the Indenture shall alter or impair the obligation of the
Company, which is absolute and unconditional, to pay the principal of and any
premium and interest on this Security at the times, place and rate, and in the
coin or currency, herein prescribed.

The Securities of this series are issuable only in
registered form without coupons in denominations of $1,000 and any integral
multiple thereof.

This Security shall be deemed to be a contract made
under the laws of the State of New York, and for all purposes shall be
construed in accordance with and governed by the laws of said State, without
regard to conflict of laws principles thereof.

All terms used in this Security that are defined in
the Indenture shall have the meanings assigned to them in the Indenture.

 

 

ASSIGNMENT

	
  FOR VALUE RECEIVED the undersigned hereby
  sells, assigns and transfers unto:

  	
   

  	
  PLEASE INSERT SOCIAL SECURITY OR OTHER IDENTIFYING
  NUMBER OF 

  
	
   

  	
   

  	
   

  	
  ASSIGNEE:

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  (Please print or typewrite name and address
  including postal zip code of assignee)

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  the within Global Security of HEWLETT-PACKARD
  COMPANY and all rights hereunder, hereby irrevocably constituting and
  appointing

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
    attorney

  
	
  to transfer said Global Security on the books of the
  within-named Company, with full power of substitution in the premises.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Dated:

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  SIGN HERE

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  NOTICE:  THE
  SIGNATURE TO THIS ASSIGNMENT MUST CORRESPOND WITH THE NAME AS WRITTEN UPON
  THE FACE OF THE WITHIN INSTRUMENT IN EVERY PARTICULAR, WITHOUT ALTERATION OR
  ENLARGEMENT OR ANY CHANGE WHATEVER.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  SIGNATURE GUARANTEED

  
	
   

  	
   

  	
   

  	
   

  	
   

  
								

 

 

SCHEDULE
OF INCREASES OR DECREASES IN GLOBAL NOTE

The following increases or
decreases in this Global Note have been made:

 

	
  Date

  	
   

  	
  Amount of Decrease in

  Principal Amount of

  this Global Note

  	
   

  	
  Amount of Increase in

  Principal Amount of

  this Global Note

  	
   

  	
  Principal Amount of

  this Global Note

  Following Such

  Decrease or Increase

  	
   

  	
  Signature of

  Authorized Signatory

  of Trustee or Notes

  Custodian

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00118-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00118-of-00352.parquet"}]]