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Exhibit 4.2    
    

        [Face of Exchange Note]

        [Insert the Global Note Legend, if applicable pursuant to the provisions of the Indenture]

	 
	 

	CUSIP:	

	

ISIN:	

	

Common Code:	

Floating Rate Senior Notes due 2012  

	 
	 
	 
	 
	 

	No.	
	 	$	

NTL CABLE PLC  

        NTL Cable PLC (the "Issuer" or the "Company") promises to pay to CEDE & CO. or its registered assigns, the principal sum of
                         U.S. Dollars on October 15, 2012. 

	Interest Payment Dates:	 	July 15, October 15, January 15 and April 15
	

Record Dates:	
 	

July 1, October 1, January 1 and April 1
	

Dated:	
 	

                        , 2005

1

 

        IN
WITNESS WHEREOF, the Company has caused this Note to be signed by its duly authorized director, officer or other authorized signatory. 

	 	 	NTL CABLE PLC
	

 	
 	
By:	

 Name:

Title:

2

 

 
 

Certificate of Authentication    
    

        This is one of the Floating Rate Senior Notes due 2012 referred to in the within-mentioned Indenture. 

Dated:                        ,
2005 

	 	 	THE BANK OF NEW YORK,
 as Trustee
	

 	
 	

By:	

 Authorized Signatory

3

 
 
 

[Reverse of Exchange Note]    

Floating
Rate Senior Notes due 2012 

        (1)   INTEREST. 

        (a)   NTL
Cable PLC, a public limited company organized under the laws of England and Wales (the "Issuer"), promises to pay interest on the principal amount of this Note at a
floating rate determined in accordance with the procedures described below and Special Interest, if any, from April 13, 2004 until maturity. The Issuer will pay interest and Special Interest,
if any, quarterly in arrears on January 15, April 15, July 15 and October 15 of each year, or if any such day is not a Business Day, on the next succeeding Business Day
(each, an "Interest Payment Date"). Interest on the Notes will accrue from the most recent date to which interest has been paid on either this Note or the Initial Note (for which this Note was
exchanged) or, if no interest has been paid, from the date of issuance; provided that the first Interest Payment Date shall be July 15, 2004. The
Issuer will pay interest (including post-petition interest in any proceeding under any Bankruptcy Law) on overdue principal and premium, if any, and on overdue installments of interest and
Special Interest, if any (without regard to any applicable grace periods), from time to time on demand at the same rate to the extent lawful. 

        This
Note was issued in connection with the Exchange Offer pursuant to which the Initial Note in like principal amount was exchanged for this Note. 

        (b)   The
Floating Rate Notes will bear interest for each period at a rate determined by The Bank of New York, acting as calculation agent. The interest rate on the Floating
Rate Notes for a particular interest period will be a per annum rate equal to LIBOR, as determined on the interest determination date, plus 5.00%. The interest determination date for an interest
period will be the second London business day preceding the first day of such interest period. The interest determination date for the Floating Rate Notes for the first interest period is
April 7, 2004. Promptly upon determination, the calculation agent will inform the Trustee and the Issuer of the interest rate for the next interest period. Interest on the Floating Rate Notes
will be calculated on the basis of the actual number of days in an interest period and a 360-day year. Absent manifest error, the determination of the interest rate by the calculation
agent will be binding and conclusive on the Holders of the Floating Rate Notes, the Trustee and the Issuer. 

        (c)   "LIBOR"
means the London interbank offered rate. "London business day" is a day on which dealings in deposits in U.S. dollars are transacted in the London interbank
market. 

        (d)   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
$1.0 million, as such rate appears on Telerate Page 3750 at approximately 11:00 a.m., London time, on such interest determination date. If Telerate Page 3750 is replaced by another
service or ceases to exist, the calculation agent will use the replacing service or such other service that may be nominated by the British Bankers' Association for the purpose of displaying LIBOR for
U.S. dollar deposits. 

4

 

        (e)   If
no offered rate appears on Telerate Page 3750 on an interest determination date at approximately 11:00 a.m., London time, then the calculation agent (after
consultation with the Issuer) will select four major banks in the London interbank market and will request each of their principal London offices to provide a quotation of the rate (expressed as a
percentage per annum) at which deposits for a three-month period (beginning on the second London business day after the interest determination date) in U.S. dollars in amounts of at least
$1.0 million are offered by it to prime banks in the London interbank market, on that date and at that time, that is representative of a single transaction in that market 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 will request
each of them to provide a quotation of the rate (expressed as a percentage per annum) 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 in an amount of at least $1.0 million that is representative of a single transaction in that market 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. 

        (f)    All
percentages resulting from any of the above calculations will be rounded, if necessary, to the nearest one hundred thousandth of a percentage point, with five
one-millionths of a percentage point being rounded upwards (e.g., 9.876545% (or .09876545) being rounded to 9.87655% (or .0987655)) and all dollar amounts used in or resulting from such
calculations will be rounded to the nearest cent (with one-half cent being rounded upwards). 

        (g)   The
interest rate on the Floating Rate Notes will in no event be higher than the maximum rate permitted by New York law as the same may be modified by United States law
of general application. 

        (h)   The
calculation agent will, upon the request of the Holder of any Floating Rate Note, provide the interest rate then in effect with respect to the Floating Rate Notes. 

        (2)  METHOD OF PAYMENT. The Issuer will pay interest on the Notes and Special Interest, if any, to the Persons who are
registered Holders at the close of business on the January 1, April 1, July 1 or October 1 next preceding the Interest Payment Date, even if such Notes are canceled after
such record date and on or before such Interest Payment Date, except as provided in Section 2.12 of the Indenture with respect to defaulted interest. The Notes will be payable as to principal,
premium and Special Interest, if any, and interest at the office or agency of the Issuer maintained for such purpose as provided in the Indenture or, at the option of the Issuer, payment of interest
and Special Interest, if any, may be made by check mailed to the Holders at their addresses set forth in the register of Holders; provided that payment
by wire transfer of immediately available funds will be required with respect to principal of and interest, premium and Special Interest, if any, on all Global Notes and all other Notes the Holders of
which will have provided wire transfer instructions to the Issuer or the Paying Agent. Such payment will be in such coin or currency of the United States as at the time of payment is legal tender for
payment of public and private debts. 

        (3)
PAYING AGENT AND REGISTRAR. Initially, the Trustee will act as Paying Agent and Registrar and The Bank of New York
(Luxembourg) S.A. will act as Paying Agent in Luxembourg. The Issuer may change any Paying Agent or Registrar without notice to any Holder. The Issuer or any of its Subsidiaries may act as Registrar. 

5

 

        (4)
INDENTURE. The Issuer issued the Notes under an Indenture, dated as of April 13, 2004 (the "Indenture"), among the
Issuer, Parent, the Intermediate Guarantors, the Senior Subordinated Subsidiary Guarantor and the Trustee. The terms of the Notes include those stated in the Indenture and those made part of the
Indenture by reference to the Trust Indenture Act of 1939, as amended (15 U.S. Code §§ 77aaa-77bbbb) (the "TIA"). The Notes are subject to all such terms, and
Holders are referred to the Indenture and the TIA for a statement of such terms. To the extent any provision of this Note conflicts with the express provisions of the Indenture, the provisions of the
Indenture shall govern and be controlling. The Notes are senior unsecured obligations of the Issuer. Unless otherwise defined herein, capitalized terms used herein have the meanings assigned to them
in the Indenture. 

        (5)
OPTIONAL REDEMPTION. Except as set forth in Section 3.10 of the Indenture, the Issuer may not redeem the Floating
Rate Notes prior to April 15, 2005. On or after this date, the Issuer may redeem the Floating Rate Notes, in whole or in part, on not less than 30 nor more than 60 days' prior notice, at
the following redemption prices (expressed as percentages of the principal amount), plus accrued and unpaid interest thereon and Special Interest, if any, to the redemption date (subject to the right
of Holders of record on the relevant record date to receive interest due on the relevant Interest Payment Date), if redeemed during the 12-month period commencing on April 15 of the
years set forth below: 

	Redemption Year
 
	 	Redemption Price

	2005	 	103%
	2006	 	102%
	2007	 	101%
	2008 and thereafter	 	100%

        (6)
MANDATORY REDEMPTION. The Issuer will not be required to make mandatory redemption or sinking fund payments with respect
to the Notes. 

        (7)
REPURCHASE AT OPTION OF HOLDER. 

        (a)   Upon
the occurrence at any time of a Triggering Event or Change of Control (other than a Change of Control resulting from a Merger Event), unless the Issuer has
exercised its right to redeem the Notes as described in Section 3.07 of the Indenture, each Holder will have the right to require the Issuer to purchase all or any part of such Holder's Notes
at a purchase price in cash equal to 101% of the principal amount thereof, plus accrued and unpaid interest and Special Interest thereon, if any, to the date of purchase (subject to the right of
Holders of record on the relevant record date to receive interest due on the relevant Interest Payment Date). Within 30 days following any Triggering Event or Change of Control, the Issuer will
mail a notice to each Holder setting forth the procedures governing the Repurchase Offer as required by the Indenture. 

        (b)   In
the event of an Asset Disposition that requires the purchase of Notes pursuant to clause (c)(3) of Section 4.10 of the Indenture, the Issuer will be
required to commence an Excess Proceeds Offer pursuant to Section 3.09 of the Indenture to purchase the maximum principal amount of Notes that may be purchased out of the Allocable Excess
Proceeds at an offer price in cash in an amount equal to 100% of the principal amount thereof plus accrued and unpaid interest and Special Interest thereon, if any, to the date fixed for the closing
of such offer in accordance with the procedures set forth in the Indenture. 

        (8)
NOTICE OF REDEMPTION. Notice of redemption will be mailed at least 30 days but not more than 60 days before
the redemption date to each Holder whose Notes are to be redeemed at its registered address. Notes in denominations larger than $1,000 may be redeemed in part but only in whole multiples of $1,000
unless all of the Notes held by a Holder are to be redeemed. On and after the redemption date interest ceases to accrue on Notes or portions thereof called for redemption. 

6

 

        (9)
DENOMINATIONS, TRANSFER, EXCHANGE. The Notes are in registered form without coupons in denominations of $1,000 and
integral multiples of $1,000. The transfer of Notes may be registered and Notes may be exchanged as provided in the Indenture. The Registrar and the Trustee may require a Holder, among other things,
to furnish appropriate endorsements and transfer documents. The Registrar may not require a Holder to pay any taxes and fees, except as otherwise set forth in the Indenture. The Registrar need not
exchange or register the transfer of any Note or portion of a Note selected for redemption, except for the unredeemed portion of any Note being redeemed in part. Also, the Registrar need not exchange
or register the transfer of any Notes for a period of 15 days before a selection of Notes to be redeemed or during the period between a record date and the corresponding Interest Payment Date. 

        (10)
PERSONS DEEMED OWNERS. The registered Holder of a Note may be treated as its owner for all purposes, except as otherwise
ordered by a court of competent jurisdiction. 

        (11)
AMENDMENT, SUPPLEMENT AND WAIVER. Subject to certain exceptions, the Indenture or the Notes may be amended or
supplemented with the consent of the Holders of at least a majority in principal amount of the then-outstanding Notes and Additional Notes, if any, and any existing default or compliance
with any provision of the Indenture or the Notes may be waived with the consent of the Holders of a majority in principal amount of the then-outstanding Notes and Additional Notes, if any.
Without the consent of any Holder, the Indenture or the Notes may be amended or supplemented to cure any ambiguity, omission, defect or inconsistency, to provide for the assumption of the Issuer's
obligations to Holders in case of a merger or consolidation or sale of all or substantially all of the Issuer's assets, to provide for uncertificated Notes in addition to or in place of certificated
Notes, to make any change that would provide any additional rights or benefits to the Holders or that does not adversely affect in any material respect the legal rights under the Indenture of any such
Holder, to comply with the requirements of the SEC in connection with the qualification of the Indenture under the TIA, to provide for the issuance of Additional Notes or Exchange Notes in accordance
with the limitations set forth in the Indenture, to mortgage, pledge, hypothecate or grant a security interest in any Property for the benefit of any Person in accordance with the limitations set
forth in the Indenture, or to add guarantors or guarantees with respect to the Notes. 

7

 

        (12)
DEFAULTS AND REMEDIES. Events of Default are set forth in the Indenture. If an Event of Default (other than an Event of
Default under the bankruptcy provisions described in Section 6.01(a)(7) of the Indenture with respect to the Issuer, any Intermediate Guarantor or any Subsidiary Guarantor) occurs and is
continuing, the Trustee or the Holders of at least 25% in aggregate principal amount of the outstanding Notes by notice to the Issuer may declare the principal of and accrued but unpaid interest on
all the Notes to be due and payable. If an Event of Default under the bankruptcy provisions described in Section 6.01(a)(7) of the Indenture with respect to the Issuer, any Intermediate
Guarantor or any Subsidiary Guarantor occurs, the unpaid principal of and interest on all the Notes will become immediately due and payable without any declaration or other act on the part of the
Trustee or any Holders. Holders may not enforce the Indenture or the Notes except as provided in the Indenture. Subject to certain limitations, Holders of a majority in principal amount of the
then-outstanding Notes may direct the Trustee in its exercise of any trust or power. The Trustee may withhold from Holders notice of any continuing Default or Event of Default (except a
Default or Event of Default in payment of principal of, premium or Special Interest, if any, or interest on any Note) if it determines that withholding notice is in their interest. The Holders of a
majority in aggregate principal amount of the Notes then outstanding by notice to the Trustee may on behalf of the Holders of all of the Notes waive any existing Default or Event of Default and its
consequences under the Indenture except a continuing Default or Event of Default in the payment of interest or premium and Special Interest on, or the principal of, the Notes. The Issuer is required
to deliver to the Trustee annually a statement regarding compliance with the Indenture, and the Issuer is required upon becoming aware of any Default or Event of Default, to deliver to the Trustee a
statement specifying such Default or Event of Default. 

        (13)
TRUSTEE DEALINGS WITH ISSUER. The Trustee, in its individual or any other capacity, may make loans to, accept deposits
from and perform services for the Issuer or its Affiliates, and may otherwise deal with the Issuer or its Affiliates, as if it were not the Trustee. 

        (14)
NO RECOURSE AGAINST OTHERS. A director, officer, employee, incorporator or stockholder of the Issuer, as such, will not
have any liability for any obligations of the Issuer under the Notes or the Indenture or for any claim based on, in respect of, or by reason of, such obligations or their creation. By accepting a
Note, each Holder waives and releases all such liability. The waiver and release are part of the consideration for the issuance of the Notes. 

        (15)
AUTHENTICATION. This Note will not be valid until authenticated by the manual or facsimile signature of the Trustee or
an authenticating agent. 

        (16)
ABBREVIATIONS. Customary abbreviations may be used in the name of a Holder or an assignee, such as: TEN COM (= tenants
in common), TEN ENT (= tenants by the entireties), JT TEN (= joint tenants with right of survivorship and not as tenants in common), CUST (= Custodian) and U/G/M/A (= Uniform Gifts to Minors Act). 

        (17)
CUSIP AND ISIN NUMBERS AND COMMON CODES. The Issuer has caused CUSIP and ISIN numbers and common codes to be printed on
the Notes and the Trustee may use CUSIP and ISIN numbers and common codes in notices of redemption as a convenience to Holders. No representation is made as to the accuracy of such numbers either as
printed on the Notes or as contained in any notice of redemption and reliance may be placed only on the other identification numbers placed thereon. 

        (18)  GOVERNING LAW. THE NOTES WILL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK (WITHOUT
GIVING EFFECT TO APPLICABLE PRINCIPLES OF CONFLICTS OF LAW TO THE EXTENT THAT THE APPLICATION OF THE LAWS OF ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY). 

8

 

        The
Issuer will furnish to any Holder upon written request and without charge a copy of the Indenture. Requests may be made to: 

NTL
Cable PLC

ntl House

Bartley Wood Business Park

Hook

Hampshire, RG27 9UP

United Kingdom

Attention: Corporate Secretary 

9

 
 
 

ASSIGNMENT FORM    
    

        To assign this Note, fill in the form below: 

	 
	 	 

	

(I) or (we) assign and transfer this Note to:	 	
 (Insert assignee's legal name)
	

 (Insert assignee's soc. sec. or tax I.D. no.)
	

	

	

	

 (Print or type assignee's name, address and zip code)
	

and irrevocably appoint	
 	

	

to transfer this Note on the books of the Issuer. The agent may substitute another to act for him.
	

Date:                                        
                  
	

 	
 	

Your
Signature:                                       
                                 

(Sign exactly as your name appears on the face of this Note)
	

Signature
Guarantee*:                                       
                   

*    Participant
in a recognized Signature Guarantee Medallion Program (or other signature guarantor acceptable to the Trustee). 

10

 
 
 

OPTION OF HOLDER TO ELECT PURCHASE    
    

        If you want to elect to have this Note purchased by the Issuer pursuant to Section 4.10 or 4.15 of the Indenture, check the appropriate box below: 

o
Section 4.10               o Section 4.15 

        If you want to elect to have only part of the Note purchased by the Issuer pursuant to Section 4.10 or Section 4.15 of the Indenture, state the
amount you elect to have purchased: 

	 
	 	 

	$                                        
                  
	

Date:                                        
                  
	

 	
 	

Your
Signature:                                       
                                 

(Sign exactly as your name appears on the face of this Note)
	

 	
 	

Tax Identification
No.:                                        
                                
	

Signature
Guarantee*:                                       
                   

*    Participant
in a recognized Signature Guarantee Medallion Program (or other signature guarantor acceptable to the Trustee). 

11

 
 
 

SCHEDULE OF EXCHANGES OF INTERESTS IN THE GLOBAL NOTE    
    

        The following exchanges of a part of this Global Note for an interest in another Global Note or for a Definitive Note, or exchanges of a part of another Global
Note or Definitive Note for an interest in this Global Note, have been made: 

	Date of Exchange
 
	 	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 officer of Trustee or Custodian

	 	 	 	 	 	 	 	 	 

12

 
 
 

[FORM OF SUBORDINATED GUARANTEE]    
    

        For value received, the Senior Subordinated Subsidiary Guarantor, to the extent set forth in and subject to the terms of the Indenture, dated as of
April 13, 2004 (the "Indenture"), among NTL Cable PLC, a public limited company organized under the laws of England and Wales (the
"Issuer"), NTL Incorporated, a Delaware corporation ("Parent"), Communications Cable Funding Corp., a
Delaware corporation, NTL (UK) Group, Inc., a Delaware corporation, NTL Communications Limited, a limited company organized under the laws of England and Wales, NTL Investment Holdings Limited,
a limited company organized under the laws of England and Wales ("NTLIH" or the "Senior Subordinated Subsidiary
Guarantor"), and The Bank of New York, as trustee (the "Trustee"), hereby jointly and severally with each other Note Guarantor
irrevocably and unconditionally guarantees to each Holder and to the Trustee and its successors and assigns (1) the full and punctual payment when due, whether at Stated Maturity, by
acceleration, by redemption or otherwise, of all obligations of the Issuer under this Indenture (including obligations to the Trustee) and the Notes, whether for payment of principal of or interest on
or premium or Special Interest, if any, on the Notes and all other monetary obligations of the Issuer under this Indenture and the Notes and (2) the full and punctual performance within
applicable grace periods of all other obligations of the Issuer whether for fees, expenses, indemnification or otherwise under this Indenture and the Notes (all the foregoing being hereinafter
collectively called the "Guaranteed Obligations"). The Senior Subordinated Subsidiary Guarantor further agrees that the Guaranteed Obligations may be
extended or renewed, in whole or in part, without notice or further assent from the Senior Subordinated Subsidiary Guarantor, and that the Senior Subordinated Subsidiary Guarantor shall remain bound
under this Guarantee notwithstanding any extension or renewal of any Guaranteed Obligation. 

        The
obligations of the Senior Subordinated Subsidiary Guarantor to the Holders and to the Trustee pursuant to this Guarantee and the Indenture are expressly set forth in
Article 11 and Article 12 of the Indenture, and reference is hereby made to the Indenture for the precise terms and limitations of this Guarantee. Each Holder of the Note to which this
Guarantee is endorsed, by accepting such Note, agrees to and shall be bound by such provisions. 

        The
Senior Subordinated Subsidiary Guarantee will be limited to an amount not to exceed the maximum amount that can be guaranteed by the Senior Subordinated Subsidiary Guarantor without
rendering such Senior Subordinated Subsidiary Guarantee voidable under applicable law relating to ultra vires, fraudulent conveyance, fraudulent transfer, corporate benefit or similar laws affecting
the rights of creditors generally. 

[Signature
on following page] 

13

 

        IN
WITNESS WHEREOF, the Senior Subordinated Subsidiary Guarantor has caused this Guarantee to be signed by a duly authorized officer. 

	 	 	NTL INVESTMENT HOLDINGS LIMITED
	

 	
 	
By:	

 Name:

Title:

14

 
 
 

[FORM OF SENIOR GUARANTEE]    
    

        For value received, each of the undersigned (the "Senior Guarantors"), to the extent set forth in and subject to
the terms of the Indenture, dated as of April 13, 2004 (the "Indenture"), among NTL Cable PLC, a public limited company organized under the laws
of England and Wales (the "Issuer"), NTL Incorporated, a Delaware corporation ("Parent"), Communications
Cable Funding Corp., a Delaware corporation, NTL (UK) Group, Inc., a Delaware corporation, NTL Communications Limited, a limited company organized under the laws of England and Wales, NTL
Investment Holdings Limited, a limited company organized under the laws of England and Wales ("NTLIH" or the "Senior
Subordinated Subsidiary Guarantor"), and The Bank of New York, as trustee (the "Trustee"), hereby jointly and severally with one
another and with the Senior Subordinated Subsidiary Guarantor irrevocably and unconditionally guarantees to each Holder and to the Trustee and its successors and assigns (1) the full and
punctual payment when due, whether at Stated Maturity, by acceleration, by redemption or otherwise, of all obligations of the Issuer under this Indenture (including obligations to the Trustee) and the
Notes, whether for payment of principal of or interest on or premium or Special Interest, if any, on the Notes and all other monetary obligations of the Issuer under this Indenture and the Notes and
(2) the full and punctual performance within applicable grace periods of all other obligations of the Issuer whether for fees, expenses, indemnification or otherwise under this Indenture and
the Notes (all the foregoing being hereinafter collectively called the "Guaranteed Obligations"). Each Senior Guarantor further agrees that the
Guaranteed Obligations may be extended or renewed, in whole or in part, without notice or further assent from such Note Guarantor, and that such Note Guarantor shall remain bound under this Guarantee
notwithstanding any extension or renewal of any Guaranteed Obligation. 

        The
obligations of each Senior Guarantor to the Holders and to the Trustee pursuant to this Guarantee and the Indenture are expressly set forth in Article 11 of the Indenture, and
reference is hereby made to the Indenture for the precise terms and limitations of this Guarantee. Each Holder of the Note to which this Guarantee is endorsed, by accepting such Note, agrees to and
shall be bound by such provisions. 

        Each
Senior Guarantee will be limited to an amount not to exceed the maximum amount that can be guaranteed by such Senior Guarantor without rendering such Senior Guarantee voidable under
applicable law relating to ultra vires, fraudulent conveyance, fraudulent transfer, corporate benefit or similar laws affecting the rights of creditors generally. 

[Signatures
on following page] 

15

 

        IN
WITNESS WHEREOF, the each Senior Guarantor has caused this Guarantee to be signed by a duly authorized officer. 

	

 	
 	
NTL INCORPORATED
	

 	
 	
By:	

 Name:

Title:
	

 	
 	
COMMUNICATIONS CABLE FUNDING CORP.
	

 	
 	
By:	

 Name:

Title:
	

 	
 	
NTL (UK) GROUP, INC.
	

 	
 	
By:	

 Name:

Title:
	

 	
 	
NTL COMMUNICATIONS LIMITED
	

 	
 	
By:	

 Name:

Title:

16

QuickLinks

Exhibit 4.2

Certificate of Authentication

[Reverse of Exchange Note ]

ASSIGNMENT FORM

OPTION OF HOLDER TO ELECT PURCHASE

SCHEDULE OF EXCHANGES OF INTERESTS IN THE GLOBAL NOTE

[FORM OF SUBORDINATED GUARANTEE]

[FORM OF SENIOR GUARANTEE]Exhibit 10.11

 

EXECUTION COPY

 

 

 

SECOND AMENDED AND RESTATED

CREDIT AGREEMENT

 

Dated as of July 24, 2003

 

Amended and Restated as of 

December 19, 2003

 

Further Amended

and Restated as of

August 1, 2005

 

among

 

NBTY, INC.,

the Borrower,

 

The Several Lenders from Time 

to Time Parties Hereto,

 

JPMORGAN CHASE BANK, N.A.

as Administrative Agent and Collateral Agent,

 

and

 

BANK OF AMERICA, N.A.,

as Syndication Agent

 

 

J.P. MORGAN SECURITIES INC.,

as Lead Bookrunner and Lead Arranger

 

 

 

 

TABLE OF CONTENTS

 

	
  SECTION 1. DEFINITIONS

  	
   

  
	
   

  	
   

  	
   

  
	
  1.1.

  	
  Defined Terms

  	
   

  
	
  1.2.

  	
  Other Definitional Provisions

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 2. AMOUNT
  AND TERMS OF COMMITMENTS

  	
   

  
	
   

  	
   

  	
   

  
	
  2.1.

  	
  Revolving Credit Commitments

  	
   

  
	
  2.2.

  	
  Procedure for Revolving Credit Borrowing

  	
   

  
	
  2.3.

  	
  Repayment of Revolving Credit Loans; Evidence
  of Debt

  	
   

  
	
  2.4.

  	
  Termination or Reduction of Revolving
  Credit Commitments

  	
   

  
	
  2.5.

  	
  Swing Line Commitment

  	
   

  
	
  2.6.

  	
  Term Loan Commitments

  	
   

  
	
  2.7.

  	
  Procedure for Term Loan Borrowing

  	
   

  
	
  2.8.

  	
  Repayment of Term Loans; Evidence of Debt

  	
   

  
	
  2.9.

  	
  Increased Commitments

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 3. LETTERS OF
  CREDIT

  	
   

  
	
   

  	
   

  	
   

  
	
  3.1.

  	
  Letters of Credit

  	
   

  
	
  3.2.

  	
  Procedure for Issuance of Letters
  of Credit

  	
   

  
	
  3.3.

  	
  Participating Interests

  	
   

  
	
  3.4.

  	
  Payments

  	
   

  
	
  3.5.

  	
  Further Assurances

  	
   

  
	
  3.6.

  	
  Obligations Absolute

  	
   

  
	
  3.7.

  	
  Letter of Credit Application

  	
   

  
	
  3.8.

  	
  Purpose of Letters of Credit

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 4.
  GENERAL PROVISIONS

  	
   

  
	
   

  	
   

  	
   

  
	
  4.1.

  	
  Interest Rates and Payment
  Dates

  	
   

  
	
  4.2.

  	
  Conversion and
  Continuation Options

  	
   

  
	
  4.3.

  	
  Minimum Amounts of Tranches

  	
   

  
	
  4.4.

  	
  Optional and Mandatory
  Prepayments

  	
   

  
	
  4.5.

  	
  Commitment Fees; Other Fees

  	
   

  
	
  4.6.

  	
  Computation of Interest and
  Fees

  	
   

  
	
  4.7.

  	
  Inability to Determine
  Interest Rate

  	
   

  
	
  4.8.

  	
  Pro Rata Treatment
  and Payments

  	
   

  
	
  4.9.

  	
  Illegality

  	
   

  
	
  4.10.

  	
  Increased Costs

  	
   

  
	
  4.11.

  	
  Indemnity

  	
   

  

 

i

 

	
  4.12.

  	
  Taxes

  	
   

  
	
  4.13.

  	
  Use of Proceeds

  	
   

  
	
  4.14.

  	
  Change in Lending Office;
  Replacement of Lender

  	
   

  
	
  4.15.

  	
  Break Funding Payments

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION
  5. REPRESENTATIONS AND WARRANTIES

  	
   

  
	
   

  	
   

  	
   

  
	
  5.1.

  	
  Financial Condition; Accuracy
  of Public Information

  	
   

  
	
  5.2.

  	
  No Change

  	
   

  
	
  5.3.

  	
  Corporate Existence;
  Compliance with Law

  	
   

  
	
  5.4.

  	
  Corporate Power;
  Authorization; Enforceable Obligations

  	
   

  
	
  5.5.

  	
  No Legal Bar

  	
   

  
	
  5.6.

  	
  No Material Litigation

  	
   

  
	
  5.7.

  	
  No Default

  	
   

  
	
  5.8.

  	
  Ownership of Property; Liens

  	
   

  
	
  5.9.

  	
  Intellectual Property

  	
   

  
	
  5.10.

  	
  Taxes

  	
   

  
	
  5.11.

  	
  Federal Regulations

  	
   

  
	
  5.12.

  	
  ERISA

  	
   

  
	
  5.13.

  	
  Investment Company Act;
  Public Utility Holding Company Act; Other Regulations

  	
   

  
	
  5.14.

  	
  Subsidiaries

  	
   

  
	
  5.15.

  	
  Environmental Matters

  	
   

  
	
  5.16.

  	
  Solvency

  	
   

  
	
  5.17.

  	
  Security Documents

  	
   

  
	
  5.18.

  	
  Insurance

  	
   

  
	
  5.19.

  	
  Affiliate Transactions

  	
   

  
	
  5.20.

  	
  Accuracy of Information

  	
   

  
	
  5.21.

  	
  OFAC

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION
  6. CONDITIONS PRECEDENT

  	
   

  
	
   

  	
   

  	
   

  
	
  6.1.

  	
  Conditions to Closing Date

  	
   

  
	
  6.2.

  	
  Conditions to Each Extension
  of Credit

  	
   

  
	
  6.3.

  	
  Conditions to Effective Date

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION
  7. AFFIRMATIVE COVENANTS

  	
   

  
	
   

  	
   

  	
   

  
	
  7.1.

  	
  Financial Statements

  	
   

  
	
  7.2.

  	
  Certificates; Other
  Information

  	
   

  
	
  7.3.

  	
  Payment of Obligations

  	
   

  
	
  7.4.

  	
  Maintenance of Existence

  	
   

  
	
  7.5.

  	
  Maintenance of Property;
  Insurance

  	
   

  
	
  7.6.

  	
  Inspection of
  Property; Books and Records; Discussions

  	
   

  
	
  7.7.

  	
  Notices

  	
   

  
	
  7.8.

  	
  Environmental Laws

  	
   

  

 

ii

 

	
  7.9.

  	
  Additional Subsidiaries;
  Additional Collateral

  	
   

  
	
  7.10.

  	
  Purchase Agreement
  Remedies

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 8.
  NEGATIVE COVENANTS

  	
   

  
	
   

  	
   

  	
   

  
	
  8.1.

  	
  Financial Condition Covenants

  	
   

  
	
  8.2.

  	
  Limitation on Indebtedness

  	
   

  
	
  8.3.

  	
  Limitation on Liens

  	
   

  
	
  8.4.

  	
  Limitation on Guarantee
  Obligations

  	
   

  
	
  8.5.

  	
  Limitation on Fundamental
  Changes

  	
   

  
	
  8.6.

  	
  Limitation on Sale of Assets

  	
   

  
	
  8.7.

  	
  Limitation on Dividends and
  Other Restricted Payments

  	
   

  
	
  8.8.

  	
  Limitation on
  Capital Expenditures

  	
   

  
	
  8.9.

  	
  Limitation on Investments,
  Loans and Advances

  	
   

  
	
  8.10.

  	
  Limitation on Optional
  Payments and Modifications of Debt Instruments

  	
   

  
	
  8.11.

  	
  Limitation on Transactions
  with Affiliates

  	
   

  
	
  8.12.

  	
  Limitation on Sales and
  Leasebacks

  	
   

  
	
  8.13.

  	
  Limitation on Changes in
  Fiscal Year

  	
   

  
	
  8.14.

  	
  Limitation on Negative
  Pledge Clauses

  	
   

  
	
  8.15.

  	
  Limitation on
  Lines of Business

  	
   

  
	
  8.16.

  	
  Hedging Agreements

  	
   

  
	
  8.17.

  	
  Rexall and Solgar Acquisitions

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 9.
  EVENTS OF DEFAULT

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION
  10. THE AGENTS AND THE ARRANGER

  	
   

  
	
   

  	
   

  	
   

  
	
  10.1.

  	
  Appointment

  	
   

  
	
  10.2.

  	
  Delegation of Duties

  	
   

  
	
  10.3.

  	
  Exculpatory Provisions

  	
   

  
	
  10.4.

  	
  Reliance by Agents

  	
   

  
	
  10.5.

  	
  Notice of Default

  	
   

  
	
  10.6.

  	
  Non-Reliance on Agents and
  Other Lenders

  	
   

  
	
  10.7.

  	
  Indemnification

  	
   

  
	
  10.8.

  	
  Agent in Its Individual
  Capacity

  	
   

  
	
  10.9.

  	
  Successor
  Agents

  	
   

  
	
  10.10.

  	
  Issuing Lender

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 11.
  MISCELLANEOUS

  	
   

  
	
   

  	
   

  	
   

  
	
  11.1.

  	
  Amendments and Waivers

  	
   

  
	
  11.2.

  	
  Notices

  	
   

  
	
  11.3.

  	
  No Waiver; Cumulative Remedies

  	
   

  
	
  11.4.

  	
  Survival

  	
   

  
	
  11.5.

  	
  Payment of Expenses and Taxes

  	
   

  

 

iii

 

	
  11.6.

  	
  Successors and Assigns;
  Participation and Assignments

  	
   

  
	
  11.7.

  	
  Adjustments; Set-off

  	
   

  
	
  11.8.

  	
  Counterparts

  	
   

  
	
  11.9.

  	
  Severability

  	
   

  
	
  11.10.

  	
  Integration

  	
   

  
	
  11.11.

  	
  GOVERNING
  LAW

  	
   

  
	
  11.12.

  	
  Submission to Jurisdiction;
  Waivers

  	
   

  
	
  11.13.

  	
  Acknowledgements

  	
   

  
	
  11.14.

  	
  WAIVERS OF
  JURY TRIAL

  	
   

  
	
  11.15.

  	
  Confidentiality

  	
   

  
	
  11.16.

  	
  Designation of Senior
  Indebtedness

  	
   

  
	
  11.17.

  	
  USA PATRIOT ACT

  	
   

  
	
   

  	
   

  	
   

  
	
  SCHEDULES:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  I

  	
  Term
  Loan A Commitments; Addresses

  	
   

  
	
  II

  	
  Domestic
  Subsidiaries; Foreign Subsidiaries

  	
   

  
	
  5.1

  	
  Contingent
  Liabilities

  	
   

  
	
  5.4

  	
  Consents

  	
   

  
	
  5.6

  	
  Litigation

  	
   

  
	
  5.8

  	
  Real
  Property Owned and Leased

  	
   

  
	
  5.10

  	
  Tax
  Filings and Payments

  	
   

  
	
  5.18

  	
  Insurance

  	
   

  
	
  5.19

  	
  Certain
  Affiliate Transactions

  	
   

  
	
  6.3(s)

  	
  Indebtedness

  	
   

  
	
  8.2

  	
  Existing
  Indebtedness

  	
   

  
	
  8.3

  	
  Existing
  Liens

  	
   

  
	
  8.4

  	
  Existing
  Guarantee Obligations

  	
   

  
	
  8.6(d)

  	
  Property
  To Be Sold

  	
   

  
	
  8.9(e)

  	
  Existing
  Investments

  	
   

  
	
   

  	
   

  	
   

  
	
  EXHIBITS:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  A-1

  	
  Form
  of Revolving Credit Note

  	
   

  
	
  A-2

  	
  Form
  of Swing Line Note

  	
   

  
	
  A-3

  	
  Form
  of Term A Note

  	
   

  
	
  A-4

  	
  Form
  of Term C Note

  	
   

  
	
  B

  	
  Form
  of Guarantee and Collateral Agreement

  	
   

  
	
  C

  	
  Form
  of Swing Line Loan Participation Certificate

  	
   

  
	
  D

  	
  Form
  of Assignment and Acceptance

  	
   

  
	
  E-1

  	
  Form
  of Opinion of Milbank, Tweed, Hadley & McCloy LLP

  	
   

  
	
  E-2

  	
  Form
  of Opinion of Irene Fisher, General Counsel to the Borrower

  	
   

  
	
  F

  	
  Form
  of Closing Certificate

  	
   

  
	
  G

  	
  Form
  of Administrative Questionnaire

  	
   

  
	
  H

  	
  Form
  of Landlord’s Lien Waiver, Access Agreement and Consent

  	
   

  

 

iv

 

SECOND
AMENDED AND RESTATED CREDIT AGREEMENT, dated as of July 24, 2003, amended
and restated as of December 19, 2003 and further amended and restated as
of August 1, 2005 (as in effect immediately prior to the Effective Date (as
defined below), the “Existing Credit Agreement”) among NBTY, INC., a
Delaware corporation (the “Borrower”), the several banks and other
financial institutions from time to time parties hereto as lenders (the “Lenders”),
JPMORGAN CHASE BANK, N.A., a national banking association organized and
existing under the laws of the United States of America, as administrative
agent and collateral agent for the Lenders hereunder (in such capacities, the “Administrative
Agent” and the “Collateral Agent,” respectively), and BANK OF
AMERICA, N.A., a national banking association organized and existing under the
laws of the United States of America, as syndication agent for the Lenders
hereunder (in such capacity, the “Syndication Agent” and, together with
the Administrative Agent and the Collateral Agent, the “Agents”).

 

W I  T  N  E  S
S  E  T  H :

 

WHEREAS,
the Borrower, Holland & Barrett Holdings Limited (“Holland & Barrett”),
certain lenders and the Administrative Agent were parties to that certain Third
Amended and Restated Credit and Guarantee Agreement, dated as of April 27,
2001 (as amended through the date hereof, the “Prior Credit Agreement”);

 

WHEREAS,
the Borrower acquired (the “Rexall Acquisition”) from Royal Numico N.V.
(“Royal Numico”) and from its wholly owned subsidiary, Numico USA, Inc.
(the “Seller”), all of the membership interests in Rexall US
Newco 1 LLC (“Rexall 1”) and all of the partnership interests
in Rexall Newco DGP 1 (“Rexall DGP” and, collectively with
Rexall 1, “Rexall”) and certain intellectual property owned by
Numico Financial Services, S.A, as set forth in the purchase agreement among
Royal Numico, the Seller and the Borrower dated as of June 9, 2003 and related
disclosure schedules and other documents (as in effect on the date thereof,
collectively, the “Rexall Purchase Agreement”);

 

WHEREAS,
the Borrower had originally entered into the Prior Credit Agreement (i) to
provide for the financing of the Rexall Acquisition, the refinancing of
outstanding indebtedness of the Borrower and Holland & Barrett of up to
$15,000,000 under the Prior Credit Agreement (the “Prior Refinancing”)
and the payment of fees, commissions and expenses in connection therewith and
(ii) following the Closing Date (as defined below), to continue to provide
financing for the general corporate purposes of the Borrower and its
Subsidiaries;

 

WHEREAS,
subsection 11.1 of this Agreement permits this Agreement to be amended from
time to time;

 

WHEREAS,
the Borrower intends to acquire (the “Solgar Acquisition”) (1) substantially
all of the assets containing the Solgar vitamin and nutritional supplements
products business of Wyeth, a Delaware corporation (“Wyeth”) commonly
referred to as “Solgar Vitamin and Herb” and (2) all of the outstanding
equity interests of Suplementos Solgar, S.L., a

 

 

Spanish
corporation (clauses (1) and (2), collectively, the “Target”) from Wyeth
and certain of its affiliates pursuant to terms and conditions contained in an
acquisition agreement and related documents as in effect on the Effective Date
(collectively, the “Solgar Purchase Agreement”);

 

WHEREAS,
the Borrower desires to create a new Class of Term Loans under this Agreement
(the “Term A Loans”) in an aggregate principal amount of $120,000,000
(it being understood that the Term A Loans existing and as defined under the
Existing Credit Agreement (the “Prior Term A Loans”) have been repaid in
full prior to the Effective Date and the making of the Term A Loans hereunder
is not a refinancing of the Prior Term A Loans);

 

WHEREAS,
the Borrower desires that the Lenders extend credit in the form of additional
Revolving Credit Loans (the “Additional Revolving Loans,” and the
Lenders’ Commitments in respect thereof, the “Additional Revolving
Commitments”) in an aggregate principal amount of $25,000,000 from and
after the Effective Date;

 

WHEREAS,
the parties hereto intend that (a) the Obligations (as defined in the Existing
Credit Agreement, the “Original Obligations”) which remain unpaid and
outstanding as of the Effective Date (which shall include, without limitation,
the Term C Loans and Revolving Credit Loans outstanding on the Effective Date
under the Existing Credit Agreement) shall continue to exist under this
Agreement on the terms set forth herein, (b) the loans under the Existing
Credit Agreement outstanding as of the Effective Date shall be Loans under and
as defined in this Agreement on the terms set forth herein, (c) any letters of
credit outstanding under the Existing Credit Agreement as of the Effective Date
shall be Letters of Credit under this Agreement and (d) the collateral
security for the Obligations and the Security Documents shall continue to
secure, guarantee, support and otherwise benefit the Original Obligations as
well as the other Obligations of Borrower and the other Loan Parties under this
Agreement and the other Loan Parties under the other Loan Documents, in each
case, on and subject to the terms and conditions of this Agreement and the
respective Security Documents, as applicable; and

 

WHEREAS,
the Lenders are willing to enter into this Agreement on the terms and
conditions hereof, including the condition precedent that this Agreement be
executed and delivered by (i) each Term A Lender hereunder, (ii) the
Existing Majority Lenders and (iii) by a majority of lenders holding
Term C Loans under the Existing Credit Agreement;

 

NOW,
THEREFORE, in consideration of the premises and the mutual covenants herein set
forth, the parties hereto agree as follows:

 

SECTION 1.  DEFINITIONS

 

1.1.          Defined
Terms.  As used in this Agreement, the following
terms shall have the following meanings:

 

“ABR
Loans”:  Loans the rate of interest
applicable to which is based upon the Alternate Base Rate.

 

2

 

“Acquisition”:  any transaction or series of related
transactions by which the Borrower or any of its Subsidiaries (a) acquires any
going business or all or substantially all of the assets of any Person, whether
through purchase of assets, merger or otherwise or (b) directly or indirectly
acquires (in one transaction or in a series of related transactions) at least
(i) a majority (in number of votes) of the Capital Stock having ordinary
voting power for the election of directors (or other managers) of any Person or
(ii) a majority of the ownership interests in any Person.

 

“Administrative
Agent”:  as defined in the preamble
hereto, and shall include any successor appointed in accordance with subsection
10.9.

 

“Administrative
Questionnaire”:  an administrative
questionnaire substantially in the form attached hereto as Exhibit G.

 

“Affiliate”:  of any Person, (a) any other Person (other
than a wholly owned Subsidiary of such Person) which, directly or indirectly,
is in control of, is controlled by, or is under common control with, such
Person or (b) any other Person who is a director or officer of (i) such
Person, (ii) any Subsidiary of such Person or (iii) any Person
described in clause (a) above.  For
purposes of this definition, a Person shall be deemed to be “controlled by”
such other Person if such other Person possesses, directly or indirectly, power
either to (A) vote 10% or more of the securities having ordinary voting
power for the election of directors of such first Person or (B) direct or
cause the direction of the management and policies of such first Person whether
by contract or otherwise.

 

“Agents”:  as defined in the preamble hereto.

 

“Aggregate
Available Revolving Credit Commitments”: 
as at any date of determination with respect to all Lenders, the
Available Revolving Credit Commitments of all Lenders on such date.

 

“Aggregate
Available Term Loan Commitments”:  as
at any date of determination with respect to all Lenders, the Available Term
Loan Commitments of all Lenders on such date.

 

“Aggregate
Revolving Credit Commitments”:  the
aggregate amount of the Revolving Credit Commitments of all the Lenders.

 

“Aggregate
Revolving Credit Outstanding”:  as at
any date of determination with respect to any Lender, the sum of (a) the
aggregate unpaid principal amount of such Lender’s Revolving Credit Loans on
such date and (b) such Lender’s Revolving Credit Commitment Percentage of the
aggregate Letter of Credit Obligations and Swing Line Loans on such date.

 

“Agreement”:  this Second Amended and Restated Credit
Agreement, as the same may be amended, supplemented or otherwise modified from
time to time.

 

3

 

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

 

“Applicable
Margin”:  for Revolving Credit Loans
and Term A Loans and for purposes of subsection 4.5(a), the rate per
annum set forth under the relevant column heading below based on the
ratio of Consolidated Indebtedness to Consolidated EBITDA, as most recently
determined in accordance with subsection 7.2(b), for any fiscal quarter of the
Borrower:

 

	
  Relevant Ratio

  of

  Consolidated

  Indebtedness to

  Consolidated

  EBITDA

  	
   

  	
  Applicable

  Margin for

  Revolving

  Eurodollar

  Loans

  	
   

  	
  Applicable

  Margin for

  Revolving

  ABR Loans

  	
   

  	
  Applicable

  Margin for

  Term A

  Eurodollar

  Loans

  	
   

  	
  Applicable

  Margin for

  Term A ABR

  Loans

  	
   

  	
  Commitment

  Fee

  	
   

  
	
  Greater than or equal to 2.5x

  	
   

  	
  2.50

  	
  %

  	
  1.50

  	
  %

  	
  1.75

  	
  %

  	
  0.75

  	
  %

  	
  0.50

  	
  %

  
	
  Less than 2.5x but greater than or equal to
  2.0x

  	
   

  	
  2.25

  	
  %

  	
  1.25

  	
  %

  	
  1.75

  	
  %

  	
  0.75

  	
  %

  	
  0.50

  	
  %

  
	
  Less than 2.0x but greater than or equal to
  1.5x

  	
   

  	
  2.00

  	
  %

  	
  1.00

  	
  %

  	
  1.50

  	
  %

  	
  0.50

  	
  %

  	
  0.50

  	
  %

  
	
  Less than 1.5x but greater than or equal to
  1.0x

  	
   

  	
  1.75

  	
  %

  	
  0.75

  	
  %

  	
  1.50

  	
  %

  	
  0.50

  	
  %

  	
  0.375

  	
  %

  
	
  Less than 1.0x

  	
   

  	
  1.50

  	
  %

  	
  0.50

  	
  %

  	
  1.25

  	
  %

  	
  0.25

  	
  %

  	
  0.25

  	
  %

  

 

Notwithstanding
the relevant ratio of Consolidated Indebtedness to Consolidated EDITDA, up to
and including the date of delivery of financial statements and related
compliance certificate of the Borrower for the first fiscal quarter ending after
the Effective Date in accordance with subsection 7.1, (x) the Applicable
Margin for Term A Loans shall be 1.50% per  annum for
Eurodollar Loans and 0.50% per  annum for ABR Loans, (y) the
Applicable Margin for Revolving Loans shall be 2.00% per  annum
for Eurodollar Loans and 1.00% per  annum for ABR Loans and
(z) the commitment fee shall be 0.50%. 
The Applicable Margin for Term C Loans shall at all times be 2.00% per
annum for Eurodollar Loans and 1.00% per  annum for ABR
Loans.

 

If
and in the event the financial statements required to be delivered pursuant to
subsection 7.1(a) or 7.1(b), as applicable, and the related compliance
certificate required to be delivered pursuant to subsection 7.2(b), are
delivered on or prior to the date when due (or, in the

 

4

 

case
of the fourth quarterly period of each fiscal year of the Borrower, if
financial statements which satisfy the requirements of, and are delivered
within the time period specified in, subsection 7.1(b) and a related compliance
certificate which satisfies the requirements of, and is delivered within the
time period specified in, subsection 7.2(b), with respect to any such quarterly
period are so delivered within such time periods), then the Applicable Margin
for Revolving Credit Loans and Term A Loans during the period that commences
five  (5) Business Days after the date
upon which such financial statements were due to be delivered shall be the
Applicable Margin as set forth in the relevant column heading above which
corresponds with the compliance certificate calculations delivered pursuant to
subsection 7.2 (b); provided, however, that in the event that the
financial statements delivered pursuant to subsection 7.1(a) or 7.1(b), as
applicable, and the related compliance certificate required to be delivered
pursuant to subsection 7.2(b), are not delivered when due, then:

 

(a)           if such financial statements and
certificate are delivered after the date such financial statements and
certificate were required to be delivered (without giving effect to any
applicable cure period) and the Applicable Margin increases from that
previously in effect as a result of the delivery of such financial statements,
then the Applicable Margin during the period from the date upon which such
financial statements were required to be delivered (without giving effect to
any applicable cure period) until the date upon which they actually are
delivered shall, except as otherwise provided in clause (c) below, be the
Applicable Margin as so increased;

 

(b)           if such financial statements and
certificate are delivered after the date such financial statements and
certificate were required to be delivered and the Applicable Margin decreases
from that previously in effect as a result of the delivery of such financial
statements, then such decrease in the Applicable Margin shall not become
applicable until the date upon which such financial statements and certificate
actually are delivered; and

 

(c)           if such financial statements and
certificate are not delivered prior to the expiration of the applicable cure
period, then, effective upon such expiration, for the period from the date upon
which such financial statements and certificate were required to be delivered
(after the expiration of the applicable cure period) until five (5) Business
Days following the date upon which they actually are delivered, the Applicable
Margin in respect of Revolving Credit Loans and Term A Loans shall be the
highest margins set forth on the preceding table and in the case of subsection
4.5(a), 0.50% per  annum (it being understood that the foregoing
shall not limit the rights of the Agents and the Lenders set forth in Section
9).

 

“Arranger”:  J.P. Morgan Securities Inc.

 

“Asset
Sale”:  any sale, sale-leaseback or
other disposition by the Borrower or any Subsidiary of any of its property or
assets, including the stock of any Subsidiary, other than any sale,
sale-leaseback or other disposition permitted under subsection 8.6 (except for
sales or

 

5

 

dispositions permitted under
subsection 8.6(e), as to which only $1,000,000 of consideration shall be
excluded from the definition of “Asset Sale” in respect of any fiscal year) or
subsection 8.12.

 

“Assignee”:  as defined in subsection 11.6(b)(iii).

 

“Assignment
and Acceptance”:  an assignment and
acceptance agreement substantially in the form attached hereto as Exhibit D.

 

“Available
Revolving Credit Commitment”:  as at
any date of determination with respect to any Lender, an amount equal to the
excess, if any, of (a) the amount of such Lender’s Revolving Credit Commitment
in effect on such date over (b) the Aggregate Revolving Credit Outstanding of
such Lender on such date.

 

“Available
Term Loan Commitment”:  as at any
date of determination with respect to any Lender, an amount equal to the
excess, if any, of (a) the amount of such Lender’s Term Loan Commitment in
effect on such date over (b) the aggregate principal amount of Term Loans
theretofore made hereunder by such Lender.

 

“Benefited
Lender”:  as defined in subsection
11.7(a).

 

“Board”:  the Board of Governors of the Federal Reserve
System of the United States of America (or any successor thereto).

 

“Borrower”:  as defined in the preamble hereto.

 

“Borrowing
Date”:  any Business Day specified in
a notice pursuant to subsection 2.2, 2.5(a), 2.7 or 3.2 as a date on which the
Borrower requests the Lenders to make Loans hereunder or issue a Letter of
Credit.

 

“Business”:  as defined in subsection 5.15(b).

 

“Business
Day”:  (a) for all purposes other
than as covered by clause (b) below, a day other than a Saturday, Sunday or
other day on which commercial banks in New York City are authorized or required
by law to close and (b) with respect to all notices and determinations in
connection with, and payments of principal and interest on, Eurodollar Loans,
any day which is a Business Day described in clause (a) and which is also a
London Banking Day.

 

“Capital
Expenditures”:  direct or indirect
(by way of the acquisition of securities of a Person or the expenditure of cash
or the incurrence of Indebtedness) expenditures (other than expenditures in
connection with Acquisitions permitted hereunder, including, without
limitation, the Rexall Acquisition and the Solgar Acquisition) in respect of the
purchase or other acquisition of fixed or capital assets.

 

“Capital
Stock”:  any and all shares,
interests, participations or other equivalents (however designated) of capital
stock of a corporation, any and all equivalent ownership interests

 

6

 

in a Person (other than a corporation)
(collectively, “Underlying Equity Interests”), and any and all warrants
or options to purchase any of the foregoing. 
For purposes of subsections 4.4(e) and 8.7 hereof, the term “Capital
Stock” shall exclude options and warrants issued pursuant to employee stock
option plans and Underlying Equity Interests issued upon the exercise thereof.

 

“Cash
Equivalents”:  (a) securities with
maturities of one year or less from the date of acquisition issued or fully
guaranteed or insured by the United States Government or any agency thereof,
(b) certificates of deposit and eurodollar time deposits with maturities of one
year or less from the date of acquisition and overnight bank deposits of any
Lender or of any commercial bank having capital and surplus in excess of
$500,000,000, (c) repurchase obligations of any Lender or of any commercial
bank satisfying the requirements of clause (b) of this definition, having a
term of not more than 30 days with respect to securities issued or fully
guaranteed or insured by the United States Government, (d) commercial paper of
a domestic issuer rated at least A-2 by S&P or P-2 by Moody’s, (e)
securities with maturities of one year or less from the date of acquisition
issued or fully guaranteed by any state, commonwealth or territory of the
United States, by any political subdivision or taxing authority of any such
state, commonwealth or territory or by any foreign government, the securities
of which state, commonwealth, territory, political subdivision, taxing
authority or foreign government (as the case may be) are rated at least A by
S&P or A by Moody’s (or the equivalent rating by either such rating agency
for such type of securities), (f) securities with maturities of one year or
less from the date of acquisition backed by standby letters of credit issued by
any commercial bank satisfying the requirements of clause (b) of this
definition or (g) shares of money market mutual or similar funds which invest
exclusively in assets satisfying the requirements of clauses (a) through (f) of
this definition.

 

“Class”:  the classification of loans as Revolving
Credit Loans, Term A Loans, Term C Loans, Swing Line Loans and any
other Class of Term Loans created pursuant to the provisions of subsection 2.9,
each of which categories shall be deemed to be a “Class” of Loans.

 

“Closing
Date”:  July 24, 2003.

 

“Code”:  the Internal Revenue Code of 1986, as amended
from time to time.

 

“Collateral
Agent”:  as defined in the preamble
hereto, and shall include any successor appointed in accordance with subsection
10.9.

 

“Commercial
Letters of Credit”:  as defined in
subsection 3.1(ii).

 

“Commitment
Letter”:  the commitment letter dated
June 6, 2005 among Borrower, JPMorgan Chase and J.P. Morgan Securities Inc.

 

“Commitments”:  the collective reference to the Revolving
Credit Commitments, the Term Loan Commitments, the Swing Line Commitment and
any Incremental Term Loan Commitments extended pursuant to subsection 2.9.

 

7

 

“Consolidated
Current Assets”:  with respect to any
Person as at any date of determination, the total assets of such Person and its
consolidated Subsidiaries which may properly be classified as current assets on
a consolidated balance sheet of such Person and its consolidated Subsidiaries
in accordance with GAAP.

 

“Consolidated
Current Liabilities”:  with respect
to any Person as at any date of determination, the total liabilities of such
Person and its consolidated Subsidiaries which may properly be classified as
current liabilities (other than the current portion of any Loans) on a
consolidated balance sheet of such Person and its consolidated Subsidiaries in
accordance with GAAP.

 

“Consolidated
EBITDA”:  for any period of four
consecutive fiscal quarters, the sum of (i) Trailing Consolidated Net
Income for such period excluding the aggregate amount of all non-cash losses
reducing Consolidated Net Income (excluding any non-cash losses that results in
an accrual of a reserve for cash charges in any future period and the reversal
thereof) for such period, (ii) Trailing Consolidated Interest Expense for
such period and (iii) the Trailing amount of taxes, depreciation and
amortization deducted from earnings in determining such Consolidated Net
Income.

 

“Consolidated
Indebtedness”:  at a particular date,
all Indebtedness of the Borrower and its Subsidiaries, determined on a
consolidated basis.

 

“Consolidated
Interest Coverage Ratio”:  for any
period of four consecutive fiscal quarters, the ratio of (i) Consolidated
EBITDA of the Borrower and its Subsidiaries to (ii) Trailing Consolidated
Interest Expense.

 

“Consolidated
Interest Expense”:  for any fiscal
period, the amount which would, in conformity with GAAP, be set forth opposite
the caption “interest expense” (or any like caption) on a consolidated income
statement of the Borrower and its Subsidiaries for such period.

 

“Consolidated
Net Income”:  for any fiscal period,
the consolidated net income (or deficit) of the Borrower and its Subsidiaries
for such period (taken as a cumulative whole), determined on a consolidated
basis in accordance with GAAP; provided that any non-cash extraordinary
gains and losses shall be excluded in determining Consolidated Net Income.

 

“Consolidated
Senior Indebtedness”:  all
Indebtedness of the Borrower which is not by its terms expressly subordinated
to the Loans under this Agreement.

 

“Continuing
Directors”:  the directors of the
Borrower on the Closing Date and each other director, if such other director’s
nomination for election to the Board of Directors of the Borrower is
recommended by a majority of the then Continuing Directors.

 

8

 

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

 

“Default”:  any of the events specified in Section 9,
whether or not any requirement for the giving of notice, the lapse of time, or
both, or any other condition, has been satisfied.

 

“Dollars,”
“U.S. Dollars” and “$”: 
dollars in lawful currency of the United States of America.

 

“Domestic
Subsidiary”:  any Subsidiary other
than a Foreign Subsidiary.

 

“Effective
Date”:  the date on which all the
conditions precedent set forth in subsection 6.3 shall have been met or waived.

 

“Environmental
Laws”:  the common law and all laws,
regulations, codes, ordinances, orders, decrees, judgments, injunctions,
notices or binding agreements issued, promulgated or entered into by any
Governmental Authority, relating in any way to the environment, the
preservation or reclamation of natural resources, the management, release or
threatened release of any Hazardous Materials or to health and safety matters.

 

“ERISA”:  the Employee Retirement Income Security Act
of 1974, as amended from time to time.

 

“ERISA
Affiliate”:  any trade or business
(whether or not incorporated) that, together with the Borrower or any of its
Subsidiaries, is treated as a single employer under Section 414(b) or (c)
of the Code or, solely for purposes of Section 302 of ERISA and Section 412 of
the Code, is treated as a single employer under Section 414 of the Code.

 

“ERISA
Event”:  (a) any “reportable
event,” as defined in Section 4043 of ERISA or the regulations issued
thereunder, with respect to a Plan (other than an event for which the 30-day
notice period is waived); (b) the existence with respect to any Plan of an
“accumulated funding deficiency” (as defined in Section 412 of the Code or
Section 302 of ERISA), whether or not waived, the failure to make by its
due date a required installment under Section 412(m) of the Code with respect
to any Pension Plan or the failure to make any required contribution to a
Multiemployer Plan; (c) the filing pursuant to Section 412(d) of the
Code or Section 303(d) of ERISA of an application for a waiver of the
minimum funding standard with respect to any Plan; (d) the incurrence by
the Borrower or any of its ERISA Affiliates of any liability under
Title IV of ERISA with respect to the termination of any Plan;
(e) the receipt by the Borrower or any ERISA Affiliate from the PBGC or a
plan administrator of any notice relating to an intention to terminate any Plan
or Plans or to appoint a trustee to administer any Plan; (f) the incurrence by
the Borrower or any of its ERISA Affiliates of any liability with respect to
the withdrawal or partial withdrawal from any Plan or Multiemployer Plan;
(g) the receipt by the Borrower or any ERISA

 

9

 

Affiliate of any notice, or the receipt by
any Multiemployer Plan from the Borrower or any ERISA Affiliate of any notice,
concerning the imposition of Withdrawal Liability or a determination that a
Multiemployer Plan is, or is expected to be, insolvent or in reorganization,
within the meaning of Title IV of ERISA; or (h) the making of any
amendment to any Pension Plan which could result in the imposition of a lien or
the posting of a bond or other security.

 

“Eurodollar
Loans”:  Loans the rate of interest
applicable to which is based upon the Eurodollar Rate.

 

“Eurodollar
Rate”:  with respect to a Eurodollar
Loan for the relevant Interest Period, an interest rate per  annum
(rounded upwards, if necessary, to the next 1/16 of 1%) equal to (a) the
LIBO Rate for such Interest Period multiplied by (b) the Statutory Reserve
Rate.

 

“Event
of Default”:  any of the events
specified in Section 9, provided that any requirement for the giving of
notice, the lapse of time, or both, or any other condition, has been satisfied.

 

“Excess
Cash Flow”:  for any fiscal year of
the Borrower, the sum, without duplication, of

 

(a)           Consolidated EBITDA for such fiscal year,
plus

 

(b)           gains excluded from Consolidated Net
Income, plus

 

(c)           reductions to non-cash working capital of
the Borrower and its consolidated Subsidiaries for such fiscal year (i.e., the decrease, if any, in
Consolidated Current Assets of the Borrower minus
Consolidated Current Liabilities of the Borrower from the beginning to the end
of such fiscal year), minus

 

(d)           the amount of any cash income taxes paid
or payable by the Borrower and its consolidated Subsidiaries with respect to
such fiscal year, net of any cash tax refunds received by the Borrower or any
of its Subsidiaries in such fiscal year, minus

 

(e)           cash interest paid by the Borrower and
its Consolidated Subsidiaries during such fiscal year, minus

 

(f)            Capital Expenditures made in cash in
accordance with subsection 8.8 during such fiscal year or Acquisitions made in
cash in accordance with subsection 8.9(g) or 8.9(h) during such fiscal year, to
the extent such Capital Expenditures or Acquisitions are funded from internally
generated funds, minus

 

(g)           permanent repayments and prepayments of
Loans made by the Borrower during such fiscal year, minus

 

10

 

(h)           extraordinary cash losses from the sale
of assets during such fiscal year and not included in Consolidated Net Income, minus

 

(i)            additions to non-cash working capital for
such fiscal year (i.e., the
increase, if any, in Consolidated Current Assets of the Borrower minus Consolidated Current Liabilities of
the Borrower from the beginning to the end of such fiscal year);

 

provided that, to the extent otherwise included
therein, the Net Cash Proceeds of Asset Sales and Recovery Events shall be
excluded from the calculation of Excess Cash Flow.

 

“Exchange
Act”:  the Securities Exchange Act of
1934, as amended.

 

“Excluded
Taxes”:  with respect to the
Administrative Agent, any Lender, the Issuing Lender or any other recipient of
any payment to be made by or on account of any obligation of the Borrower
hereunder, (a) any Taxes imposed by any jurisdiction other than the United
States (or any taxing authority thereof or therein), any jurisdiction in which
the Borrower conducts business or claims an interest deduction with respect to
this Agreement or any other taxing jurisdiction from or through which payments
hereunder are made, (b) income or franchise taxes imposed on (or measured
by) its net income or net profits by the United States of America, or by the
jurisdiction under the laws of which such recipient is organized, in which such
recipient conducts business (other than a business that is deemed to arise
solely as a result of entering into this Agreement, receipt of payments
hereunder or enforcement of its rights hereunder)) or in which its principal
office is located or, in the case of any Lender, in which its applicable
lending office is located, (c) any branch profits taxes imposed by the
United States of America or any similar tax imposed by any other jurisdiction
in which the Borrower is located and (d) in the case of a Foreign Lender
(other than an assignee pursuant to a request by the Borrower under subsection
4.14(b)), any withholding tax that is imposed on amounts payable to such
Foreign Lender at the time such Foreign Lender becomes a party to this
Agreement (or designates a new lending office) or is attributable to such
Foreign Lender’s failure to comply with subsection 4.12(e), except to the
extent that such Foreign Lender (or its assignor, if any) was entitled, at the
time of designation of a new lending office (or assignment), to receive
additional amounts from the Borrower with respect to such withholding tax
pursuant to subsection 4.12(a).

 

“Existing
Credit Agreement”:  as defined in the
preamble hereto.

 

“Existing
Lenders”: the “Lenders” as defined in the Existing Credit Agreement.

 

“Existing
Majority Lenders”: the “Majority Lenders” as defined in the Existing Credit
Agreement.

 

“Existing
Note Payoff Amount”:  the amount
equal to the aggregate principal amount of the Existing Notes or any
Refinancing Indebtedness in respect thereof (as the case may be) plus
the amount of any premiums required to be paid thereon and reasonable fees and
expenses associated therewith.

 

11

 

“Existing
Notes”:  the Borrower’s 8-5/8% Senior
Subordinated Notes due 2007.

 

“Existing
Notes Indenture”:  as defined in subsection
6.3(o).

 

“Extension
of Credit”:  as to any Lender, the
making of a Loan by such Lender and, with respect to any Lender, the issuance
of any Letter of Credit.

 

“Federal
Funds Effective Rate”:  for any day,
the weighted average (rounded upwards, if necessary, to the next 1/100 of 1%)
of the rates on overnight Federal funds transactions with members of the
Federal Reserve System arranged by Federal funds brokers, as published on the
next succeeding Business Day by the Federal Reserve Bank of New York, or,
if such rate is not so published for any day that is a Business Day, the
average (rounded upwards, if necessary, to the next 1/100 of 1%) of the
quotations for such day for such transactions received by the Administrative
Agent from three Federal funds brokers of recognized standing selected by it.

 

“Fee
Property”:  as defined in subsection
5.8.

 

“Financing
Lease”:  (a) any lease of property,
real or personal, the obligations under which are capitalized on a consolidated
balance sheet of the Borrower and its Subsidiaries and (b) any other such lease
to the extent that the then present value of the minimum rental commitment
thereunder should, in accordance with GAAP, be capitalized on a balance sheet
of the lessee.

 

“Foreign
Plan”:  any employee benefit plan,
program, policy, arrangement or agreement maintained or contributed to by, or
entered into with, Borrower or any Subsidiary with respect to employees
employed outside the United States.

 

“Foreign
Lender”:  any Lender that is
organized under the laws of a jurisdiction other than that in which the
Borrower is located.  For purposes of
this definition, the United States of America, each State thereof and the
District of Columbia shall be deemed to constitute a single jurisdiction.

 

“Foreign
Subsidiary”:  as to any Person, any
Subsidiary of such Person which is organized under the laws of any jurisdiction
outside of the country of the jurisdiction of organization of such Person.

 

“GAAP”:  generally accepted accounting principles in
the United States of America in effect from time to time.

 

“Gel-Cap
Facility”:  the soft gelatin capsule
manufacturing facility located at Cartwright Loop Industrial Park, Church
Street, Bayport, New York.

 

12

 

“Governmental
Authority”:  any nation or
government, any state, province or other political subdivision thereof and any
entity exercising executive, legislative, judicial, regulatory or
administrative functions of or pertaining to government.

 

“Guarantee
and Collateral Agreement”:  the
Guarantee and Collateral Agreement, substantially in the form attached hereto
as Exhibit B, executed and delivered by the Borrower and each of
its Domestic Subsidiaries, as the same may be amended, supplemented or
otherwise modified.

 

“Guarantee
Obligation”:  as to any Person, any
obligation of such Person guaranteeing or in effect guaranteeing any
Indebtedness, leases, dividends or other obligations (the “primary
obligations”) of any other Person (the “primary obligor”) in any
manner, whether directly or indirectly, including, without limitation, any
obligation of such Person, whether or not contingent (a) to purchase any such
primary obligation or any property constituting direct or indirect security
therefor, (b) to advance or supply funds (i) for the purchase or payment
of any such primary obligation or (ii) to maintain working capital or
equity capital of the primary obligor or otherwise to maintain the net worth or
solvency of the primary obligor, (c) to purchase property, securities or services
primarily for the purpose of assuring the owner of any such primary obligation
of the ability of the primary obligor to make payment of such primary
obligation or (d) otherwise to assure or hold harmless the owner of any such
primary obligation against loss in respect thereof; provided, however,
that the term Guarantee Obligation shall not include endorsements of
instruments for deposit or collection in the ordinary course of business.  The amount of any Guarantee Obligation shall
be deemed to be an amount equal to the value as of any date of determination of
the stated or determinable amount of the primary obligation in respect of which
such Guarantee Obligation is made (unless such Guarantee Obligation shall be
expressly limited to a lesser amount, in which case such lesser amount shall
apply) or, if not stated or determinable, the value as of any date of
determination of the maximum reasonably anticipated liability in respect
thereof as determined by such Person in good faith.

 

“Hazardous
Materials”:  any solid wastes, toxic
or hazardous substances, materials or wastes, defined, listed, classified or
regulated as such in or under any Environmental Laws, including, without
limitation, asbestos, petroleum or petroleum products (including gasoline,
crude oil or any fraction thereof), polychlorinated biphenyls, and
urea-formaldehyde insulation, and any other substance the presence of which may
give rise to liability under any Environmental Law.

 

“Hazle
Township Facility”: that certain facility owned by NBTY PAH, LLC located at
10 Simmons Drive, Humboldt Industrial Park, Hazle Township, Pennsylvania.

 

“Hedge
Agreement”:  any interest rate
protection agreement, interest rate swap or other interest rate hedge
arrangement, or currency swap or other currency hedge arrangement (other than
any interest rate cap or other similar agreement or arrangement pursuant to
which the Borrower has no credit exposure), to or under which the Borrower or
any of its Subsidiaries is a party or a beneficiary.

 

13

 

“Hedge
Agreement Obligations”:  all
obligations of the Borrower under any one or more Hedge Agreements to make
payments to the counterparties thereunder upon the occurrence of a termination
event or similar event thereunder.

 

“Holland
& Barrett”:  as defined in the
recitals hereto.

 

“Increase
Effective Date”:  as defined in
subsection 2.9(a).

 

“Increase
Joinder”:  as defined in subsection
2.9(c).

 

“Incremental
Term Loan Commitment”:  as defined in
subsection 2.9(a).

 

“Incremental
Term Loans”:  as defined in
subsection 2.9(c).

 

“Indebtedness”:  of a Person, at a particular date, the sum
(without duplication) at such date of (a) indebtedness for borrowed money or
for the deferred purchase price of property or services in respect of which
such Person is liable as obligor (other than current trade liabilities incurred
in the ordinary course of business and payable in accordance with customary
practices of such Person), (b) indebtedness secured by any Lien on any property
or asset owned or held by such Person regardless of whether the indebtedness
secured thereby shall have been assumed by or is a primary liability of such
Person, (c) obligations of such Person under Financing Leases, (d) the face
amount of all letters of credit issued for the account of or upon the
application of such Person and, without duplication, the unreimbursed amount of
all drafts drawn thereunder and (e) obligations (in the nature of principal or
interest) of such Person in respect of acceptances or similar obligations
issued or created for the account of such Person.

 

“Indemnified
Taxes”:  Taxes other than Excluded
Taxes.

 

“Insolvency”:  with respect to any Multiemployer Plan, the
condition that such Plan is insolvent within the meaning of Section 4245 of
ERISA.

 

“Insolvent”:  pertaining to a condition of Insolvency.

 

“Intellectual
Property”:  as defined in subsection
5.9.

 

“Interest
Payment Date”:  (a) as to any ABR
Loan, the last day of each March, June, September and December to occur while
such Loan is outstanding, (b) as to any Eurodollar Loan having an Interest
Period of three months or less, the last day of such Interest Period and (c) as
to any Eurodollar Loan having an Interest Period longer than three months,
(i) each day which is three months after the first day of such Interest
Period and (ii) the last day of such Interest Period.

 

14

 

“Interest
Period”:  with respect to any
Eurodollar Loan:

 

(a)           initially, the period commencing on the
borrowing or conversion date, as the case may be, with respect to such
Eurodollar Loan and ending one, two, three or six months (or nine or twelve
months, if available to all Lenders) thereafter, as selected by the Borrower in
its notice of borrowing or notice of conversion, as the case may be, given with
respect thereto; and

 

(b)           thereafter, each period commencing on the
last day of the next preceding Interest Period applicable to such Eurodollar
Loan and ending one, two, three or six months (or nine or twelve months, if
acceptable to all Lenders) thereafter, as selected by the Borrower by
irrevocable notice to the Administrative Agent not less than three Business
Days prior to the last day of the then current Interest Period with respect
thereto;

 

provided that all of the foregoing provisions
relating to Interest Periods are subject to the following:

 

(i)      if any Interest Period pertaining to a
Eurodollar Loan would otherwise end on a day that is not a Business Day, such
Interest Period shall be extended to the next succeeding Business Day unless
the result of such extension would be to carry such Interest Period into
another calendar month, in which event such Interest Period shall end on the
immediately preceding Business Day;

 

(ii)     any Interest Period applicable to a
Eurodollar Loan that would otherwise extend beyond the date final payment is
due on such Loan shall end on such date of final payment; and

 

(iii)    any Interest Period pertaining to a
Eurodollar Loan that begins on the last Business Day of a calendar month (or on
a day for which there is no numerically corresponding day in the calendar month
at the end of such Interest Period) shall end on the last Business Day of a
calendar month.

 

“Issuing
Lender”:  JPMorgan Chase or any of
its Affiliates, in its capacity as issuer of the Letters of Credit, and any
other Lender which the Borrower, the Administrative Agent and the Majority
Lenders shall have approved, in its capacity as issuer of the Letters of
Credit.

 

“JPMorgan
Chase”:  JPMorgan Chase Bank, N.A.

 

“Landlord’s
Lien Waiver, Access Agreement and Consent”: 
a lien waiver, access agreement and consent substantially in the form
attached hereto as Exhibit H.

 

“Leased
Property”:  as defined in subsection
5.8.

 

15

 

“Legal
Requirement”:  as to (a) any Person,
any law, treaty, rule or regulation or determination of an arbitrator or a
court or other Governmental Authority, in each case applicable to or binding
upon such Person or any of its property or to which such Person or any of its
property is subject, and (b) any property, any law, treaty, rule, regulation,
requirement, judgment, decree or determination of any Governmental Authority
applicable to or binding upon such property or to which such property is
subject.

 

“Lenders”:  as defined in the preamble hereto.

 

“Letter
of Credit Applications”:  (a) in the
case of Standby Letters of Credit, a letter of credit application for a Standby
Letter of Credit on the standard form of the applicable Issuing Lender for
standby letters of credit, and (b) in the case of Commercial Letters of Credit,
a letter of credit application for a Commercial Letter of Credit on the
standard form of the applicable Issuing Lender for commercial letters of
credit.

 

“Letter
of Credit Obligations”:  at any particular
time, all liabilities of the Borrower with respect to Letters of Credit,
whether or not any such liability is contingent, including (without
duplication) the sum of (a) the aggregate undrawn face amount of all Letters of
Credit then outstanding plus (b) the aggregate amount of all unpaid
Reimbursement Obligations at such time.

 

“Letters
of Credit”:  as defined in subsection
3.1(ii).

 

“LIBO
Rate”:  with respect to any
Eurodollar Loan for any Interest Period, the rate appearing on Page 3750 of the
Dow Jones Market Service (or on any successor or substitute page of such
Service, or any successor to or substitute for such Service, providing rate
quotations comparable to those currently provided on such page of such Service,
as determined by the Administrative Agent from time to time for purposes of
providing quotations of interest rates applicable to Dollar deposits in the
London interbank market) at approximately 11:00 a.m., London time, two Business
Days prior to the commencement of such Interest Period, as the rate for Dollar
deposits with a maturity comparable to such Interest Period.  In the event that such rate is not available
at such time for any reason, then the “LIBO Rate” with respect to such
Eurodollar Loan for such Interest Period shall be the rate at which Dollar
deposits of $5,000,000 and for a maturity comparable to such Interest Period
are offered by the principal London office of the Administrative Agent in
immediately available funds in the London interbank market at approximately
11:00 a.m., London time, two Business Days prior to the commencement of
such Interest Period.

 

“Lien”:  any mortgage, pledge, hypothecation,
assignment, deposit arrangement (other than a bank or similar deposit account),
encumbrance, lien (statutory or other), or preference, priority or other
security interest or similar preferential arrangement of any kind or nature
whatsoever (including, without limitation, any conditional sale or other title
retention agreement, any Financing Lease having substantially the same economic
effect as any of the foregoing, the filing of any financing statement under the
Uniform Commercial Code or comparable law of any

 

16

 

jurisdiction in respect of any of the
foregoing, and, in the case of securities, a third party’s right to purchase
such securities).

 

“Loan
Documents”:  the collective reference
to this Agreement, any Notes, the Security Documents and any documents or
instruments evidencing or governing the Security Documents.

 

“Loan
Parties”:  the collective reference
to the Borrower and each guarantor or grantor party to any Security Document.

 

“Loans”:  the collective reference to the Revolving
Credit Loans, the Term Loans and the Swing Line Loans and any loans made
pursuant to subsection 2.9.

 

“London
Banking Day”:  any day on which banks
in London are open for general banking business, including dealings in foreign
currency and exchange.

 

“Majority
Lenders”:  at any time, Lenders, the
Total Loan Percentages of which aggregate more than 50%.

 

“Material
Adverse Effect”:  a material adverse
change in the business, assets, operations, properties, condition (financial or
otherwise), contingent liabilities (including as to products, and whether such
liabilities have been or yet may be asserted), prospects or material agreements
of the Borrower and its Subsidiaries taken as a whole.

 

“Material
Environmental Amount”:  $500,000.

 

“Material
Foreign Subsidiary”:  any Foreign
Subsidiary accounting for 5% or more of the assets or revenues (computed for
the most recent fiscal year) of the Borrower and its consolidated Subsidiaries,
taken as a whole.

 

“Moody’s”:  Moody’s Investors Service, Inc. or any
successor thereto.

 

“Multiemployer
Plan”:  a Plan which is a
multiemployer plan as defined in Section 4001(a)(3) of ERISA.

 

“Net
Cash Proceeds”:  (a) in connection
with any Asset Sale or any Recovery Event, the proceeds thereof in the form of
cash and Cash Equivalents (including any such proceeds received by way of
deferred payment of principal pursuant to a note or installment receivable or
purchase price adjustment receivable or otherwise, but only as and when
received) of such Asset Sale or Recovery Event, net of attorneys’ fees,
accountants’ fees, investment banking fees, amounts required to be applied to
the repayment of Indebtedness secured by a Lien expressly permitted hereunder
on any asset that is the subject of such Asset Sale or Recovery Event (other
than any Lien pursuant to a Security Document) and other customary fees and
expenses actually incurred in connection therewith and net of taxes paid or
reasonably estimated to be payable

 

17

 

as a result thereof (after taking into
account any available tax credits or deductions and any tax sharing arrangements)
and (b) in connection with any issuance or sale of Capital Stock or any
incurrence of Indebtedness, the cash proceeds received from such issuance or
incurrence, net of attorneys’ fees, investment banking fees, accountants’ fees,
underwriting discounts and commissions and other customary fees and expenses
actually incurred in connection therewith.

 

“New
Lender”:  a financial institution or
other entity who becomes party to this Agreement pursuant to an Increase
Joinder.

 

“Notes”:  the collective reference to the Revolving
Credit Notes, the Term Notes and the Swing Line Notes.

 

“Obligations”:  collectively, the unpaid principal of and
interest on the Loans, the Reimbursement Obligations and all other obligations
and liabilities of the Borrower to any Agent, the Issuing Lender and the
Lenders under or in connection with this Agreement, the other Loan Documents
and any Hedge Agreement with any Lender or any Affiliate of a Lender (including
in each case, without limitation, interest accruing at the then applicable rate
provided in this Agreement or any other applicable Loan Document or Hedge
Agreement after the maturity of the Loans and interest accruing at the then
applicable rate provided in this Agreement or any other applicable Loan
Document or Hedge Agreement after the filing of any petition in bankruptcy, or
the commencement of any insolvency, reorganization or like proceeding, relating
to the Borrower, whether or not a claim for post-filing or post-petition
interest is allowed in such proceeding), whether direct or indirect, absolute
or contingent, due or to become due, or now existing or hereafter incurred,
which may arise under, out of, or in connection with, this Agreement, the
Notes, the Letters of Credit, the Letter of Credit Applications, the other Loan
Documents or any Hedge Agreement with a Lender or any Affiliate of a Lender or
any other document made, delivered or given in connection therewith, in each
case whether on account of principal, interest, reimbursement obligations,
fees, indemnities, costs, expenses or otherwise (including, without limitation,
all fees and disbursements of counsel to the Agents or to the Lenders).

 

“Original
Obligations”:  as defined in the
recitals hereto.

 

“Other
Taxes”:  any and all present or
future stamp or documentary taxes or any other excise or property taxes,
charges or similar levies arising from any payment made hereunder or from the
execution, delivery or enforcement of, or otherwise with respect to, this
Agreement.

 

“Participants”:  as defined in subsection 11.6(c).

 

“Participating
Interest”:  with respect to any
Letter of Credit (a) in the case of the Issuing Lender, its interest in such
Letter of Credit and any Letter of Credit Application relating thereto after
giving effect to the granting of any participating interests therein pursuant
hereto

 

18

 

and (b) in the case of each Participating
Lender, its undivided participating interest in such Letter of Credit and any
Letter of Credit Application relating thereto.

 

“Participating
Lender”:  any Lender (other than the
Issuing Lender) with respect to its Participating Interest in a Letter of
Credit.

 

“Patriot
Act”:  as defined in subsection
11.17.

 

“PBGC”:  the Pension Benefit Guaranty Corporation
established pursuant to Subtitle A of Title IV of ERISA or any successor
thereto.

 

“Pension
Plan” shall mean an employee pension benefit plan (other than a
Multiemployer Plan) which is covered by Title IV of ERISA or subject to the
minimum funding standards under Section 412 of the Code or Section 302 of
ERISA and is maintained or contributed to by any ERISA Affiliate or with
respect to which the Borrower or a Subsidiary could incur liability.

 

“Person”:  an individual, partnership, corporation,
business trust, joint stock company, limited liability company, trust,
unincorporated association, joint venture, Governmental Authority or other
entity of whatever nature.

 

“Plan”:  any employee pension benefit plan (other than
a Multiemployer Plan) subject to the provisions of Title IV of ERISA or
Section 412 of the Code or Section 302 of ERISA, and in respect of
which the Borrower, any of its Subsidiaries or any ERISA Affiliate is (or, if
such plan were terminated, would under Section 4069 of ERISA be deemed to
be) an “employer” as defined in Section 3(5) of ERISA.

 

“Pledged
Stock”:  as defined in the Guarantee
and Collateral Agreement or any other Security Document.

 

“Pledgee”:  as defined in subsection 11.15.

 

“Preferred
Stock”:  with respect to any Person,
any and all preferred or preference Capital Stock (however designated) of such
Person, whether now outstanding or issued after the Effective Date.

 

“Prime
Rate”:  the rate of interest per
annum publicly announced from time to time by JPMorgan Chase as its
prime rate in effect at its principal office in New York City; each change in
the Prime Rate shall be effective from and including the date such change is
publicly announced as being effective.

 

“Prior
Credit Agreement”:  as defined in the
recitals hereto.

 

“Prior
Refinancing”:  as defined in the
recitals hereto.

 

19

 

“Prior
Term A Loans”:  as defined in the
recitals hereto.

 

“Pro
Forma Balance Sheet”:  as defined in
subsection 5.1(b).

 

“Properties”:  as defined in subsection 5.15(a).

 

“Recovery
Event”:  any settlement of or payment
in respect of any property or casualty insurance claim or any condemnation
proceeding relating to any asset of the Borrower or any of its Subsidiaries.

 

“Refinancing
Indebtedness”:  Indebtedness that refinances,
renews, extends, replaces, defeases or refunds, in whole or in part, any
Indebtedness of the Borrower or any of its Subsidiaries; provided that

 

(i)            other than in the case of Refinancing
Indebtedness refinancing the Existing Notes or any Refinancing Indebtedness in
respect thereof (the aggregate amount of which Refinancing Indebtedness
(whether in respect of the Existing Notes or any Refinancing Indebtedness in
respect thereof) will not be limited by this Agreement), any such Refinancing
Indebtedness is in an aggregate principal amount not greater than the aggregate
principal amount of the Indebtedness being renewed or refinanced, plus
the amount of any premiums required to be paid thereon and reasonable fees and
expenses associated therewith;

 

(ii)           in the case of Refinancing Indebtedness
refinancing the Existing Notes or any Refinancing Indebtedness in respect
thereof, the subordination terms applicable to such Refinancing Indebtedness
are in all material respects substantially identical to, or less favorable to
the holders of such Refinancing Indebtedness than, those applicable to the
Existing Notes (provided that this provision shall not apply to any
secured Indebtedness incurred pursuant to the proviso in subsection 8.10(a) and
such Indebtedness shall be deemed “Refinancing Indebtedness” for all purposes
hereunder);

 

(iii)          any such Refinancing Indebtedness has a later
or equal final maturity and longer or equal weighted average life than the
Indebtedness being renewed or refinanced.

 

“Refunded
Swing Line Loans”:  as defined in
subsection 2.5(b).

 

“Register”:  as defined in subsection 11.6(b).

 

“Reimbursement
Obligation”:  the obligation of the
Borrower to reimburse the Issuing Lender in accordance with the terms of this
Agreement and the related Letter of Credit Application for any payment made by
the Issuing Lender under any Letter of Credit.

 

“Reinvestment
Deferred Amount”:  with respect to
any Reinvestment Event, the aggregate Net Cash Proceeds received by the
Borrower or any of its Subsidiaries in connection

 

20

 

therewith that are not applied to prepay the
Term Loans pursuant to subsection 4.4(d) as a result of the delivery of a
Reinvestment Notice.

 

“Reinvestment
Event”:  any Asset Sale or Recovery
Event in respect of which the Borrower has delivered a Reinvestment Notice.

 

“Reinvestment
Notice”:  a written notice executed
by a Responsible Officer of the Borrower stating that the Borrower (directly or
indirectly through a Subsidiary) intends and expects to use all or a specified
portion of the Net Cash Proceeds of an Asset Sale or Recovery Event to acquire
assets useful in its business.

 

“Reinvestment
Prepayment Amount”:  with respect to
any Reinvestment Event, the Reinvestment Deferred Amount relating thereto less
any amount expended prior to the relevant Reinvestment Prepayment Date to
acquire assets useful in the Borrower’s business.

 

“Reinvestment
Prepayment Date”:  with respect to
any Reinvestment Event, the earlier of (a) the date occurring six months after
such Reinvestment Event and (b) the date on which the Borrower shall have
determined not to, or shall have otherwise ceased to, acquire assets useful in
the Borrower’s business with all or any portion of the relevant Reinvestment
Deferred Amount.

 

“Related
Parties”:  with respect to any
specified Person, such Person’s Affiliates and the respective directors,
officers, employees, agents and advisors of such Person and such Person’s
Affiliates.

 

“Release”:  any spilling, leaking, pumping, pouring,
emitting, emptying, discharging, escaping, leaking, dumping, disposing,
spreading, depositing or dispersing of any Hazardous Materials in, unto or onto
the environment.

 

“Reorganization”:  with respect to any Multiemployer Plan, the
condition that such plan is in reorganization within the meaning of Section
4241 of ERISA.

 

“Requirement
of Law”:  as to (a) any Person, the
certificate of incorporation and by-laws or the partnership or limited
partnership agreement or other organizational or governing documents of such
Person, and any law, treaty, rule or regulation or determination of an
arbitrator or a court or other Governmental Authority, in each case applicable
to or binding upon such Person or any of its property or to which such Person
or any of its property is subject, and (b) any property, any law, treaty, rule,
regulation, requirement, judgment, decree or determination of any Governmental
Authority applicable to or binding upon such property or to which such property
is subject, including, without limitation, any Environmental Laws.

 

“Responsible
Officer”:  with respect to any Loan
Party, the chief executive officer, the president, the chief financial officer,
any vice president, the treasurer or the assistant treasurer of such Loan
Party.

 

21

 

“Restricted
Payments”:  as defined in subsection
8.7.

 

“Revolving
Credit Commitment”:  as to any Lender
at any time, its obligation to make Revolving Credit Loans, issue or
participate in Letters of Credit issued for the account of the Borrower and/or
make or participate in Swing Line Loans to the Borrower in an aggregate amount
not to exceed at any time outstanding the amount set forth opposite such
Lender’s name in Schedule I hereto under the heading “Revolving Credit
Commitment,” as such amount may be changed from time to time pursuant to
subsection 2.4 and the other applicable provisions hereof.

 

“Revolving
Credit Commitment Percentage”:  as to
any Lender at any time, the percentage which such Lender’s Revolving Credit
Commitment then constitutes of the Aggregate Revolving Credit Commitments (or,
if the Revolving Credit Commitments have terminated or expired at such time,
the percentage which (a) the Aggregate Revolving Credit Outstanding of such
Lender at such time then constitutes of (b) the Aggregate Revolving Credit
Outstanding of all Lenders at such time).

 

“Revolving
Credit Commitment Period”:  the
period from and including the Closing Date to but not including the Revolving
Credit Termination Date, or such earlier date on which the Revolving Credit
Commitments shall terminate as provided herein.

 

“Revolving
Credit Loan”:  as defined in
subsection 2.1(a).

 

“Revolving
Credit Note”:  as defined in
subsection 2.3(e).

 

“Revolving
Credit Termination Date”:  the earliest
to occur of (i) July 24, 2008, (ii) March 15, 2007 if any of the
Existing Notes shall be outstanding on such date and (iii) the earliest
date of maturity of any Indebtedness of the Borrower or any of its Subsidiaries
that refinances the Existing Notes.

 

“Rexall”:  as defined in the recitals hereto.

 

“Rexall
Acquisition”:  as defined in the
recitals hereto.

 

“Rexall
DGP”:  as defined in the recitals
hereto.

 

“Rexall 1”:  as defined in the recitals hereto.

 

“Rexall
Purchase Agreement”:  as defined in the
recitals hereto.

 

“Rexall
Transactions”:  the Rexall
Acquisition, the Prior Refinancing, the Extensions of Credit made under the
Existing Credit Agreement on the Closing Date and the payment of fees,
commissions and expenses in connection therewith (including any payment by the
Borrower pursuant to the Rexall Purchase Agreement).

 

“Royal
Numico”:  as defined in the recitals
hereto.

 

22

 

“S&P”:  Standard & Poor’s Ratings Services or any
successor thereto.

 

“Security
Documents”:  the collective reference
to the Guarantee and Collateral Agreement and each other pledge agreement,
security document or similar agreement that may be delivered to the
Administrative Agent as collateral security for any or all of the Obligations,
in each case as amended, supplemented or otherwise modified from time to time.

 

“Seller”:  as defined in the recitals hereto.

 

“Solgar
Acquisition”:  as defined in the
recitals hereto.

 

“Solgar
Purchase Agreement”:  as defined in
the recitals hereto.

 

“Solvent”:  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, without limitation,
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 mature, (c) such Person does not intend to, and does not believe that it
will, incur debts or liabilities beyond such Person’s ability to pay as such
debts and liabilities mature, (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 amount of capital
and (e) such Person is able to pay its debts as they become due and
payable.

 

“Standby
Letters of Credit”:  as defined in
subsection 3.1(i).

 

“Statutory
Reserve Rate”:  a fraction (expressed
as a decimal), the numerator of which is the number one and the denominator of
which is the number one minus the aggregate of the maximum reserve percentages
(including any marginal, special, emergency or supplemental reserves) expressed
as a decimal established by the Board to which the Administrative Agent is
subject with respect to the Eurodollar Rate, for eurocurrency funding
(currently referred to as “Eurocurrency Liabilities” in Regulation D of
the Board).  Such reserve percentages
shall include those imposed pursuant to such Regulation D.  Eurodollar Loans shall be deemed to
constitute eurocurrency funding and to be subject to such reserve requirements
without benefit of or credit for proration, exemptions or offsets that may be
available from time to time to any Lender under such Regulation D or any
comparable regulation.  The Statutory
Reserve Rate shall be adjusted automatically on and as of the effective date of
any change in any reserve percentage.

 

“Subordinated
Debt”:  $150,000,000 in aggregate
principal amount of Existing Notes.

 

“Subsidiary”:  as to any Person, a corporation, partnership
or other entity of which shares of stock or other ownership interests having
ordinary voting power (other than stock or such other ownership interests
having such power only by reason of the happening of a contingency)

 

23

 

to elect a majority of the board of directors
or other managers of such corporation, partnership or other entity are at the
time owned, or the management of which is otherwise controlled, directly or
indirectly, through one or more intermediaries, or both, by such Person
(exclusive of any Affiliate in which such Person has a minority ownership
interest).  Unless otherwise qualified,
all references to a “Subsidiary” or to “Subsidiaries” in this Agreement shall
refer to a Subsidiary or Subsidiaries of the Borrower.

 

“Swing
Line Commitment”:  the Swing Line
Lender’s obligation to make Swing Line Loans pursuant to subsection 2.5.

 

“Swing
Line Lender”:  JPMorgan Chase, in its
capacity as lender of the Swing Line Loans.

 

“Swing
Line Loan Participation Certificate”: 
a certificate in substantially the form attached hereto as Exhibit C,
as the same may be amended, supplemented or otherwise modified from time to
time.

 

“Swing
Line Loans”:  as defined in
subsection 2.5(a).

 

“Swing
Line Note”:  as defined in subsection
2.3(e).

 

“Syndication
Agent”:  as defined in the preamble
hereto, and shall include any successor appointed in accordance with subsection
10.9.

 

“Target”:  as defined in the recitals hereto.

 

“Taxes”:  any and all present or future taxes, levies,
imposts, duties, deductions, charges or withholdings imposed by any
Governmental Authority.

 

“Term
A Lender”:  a Lender making a Term A
Loan.

 

 “Term A Loans”:  as defined in subsection 2.6.

 

“Term A
Note”:  a Term Note evidencing a Term
A Loan.

 

“Term
C Lender”:  a Lender making a Term C
Loan.

 

“Term C
Loan”:  as defined in
subsection 2.6.

 

“Term C
Note”:  a Term Note evidencing a
Term C Loan.

 

“Term
Loan A Commitment”:  as to any
Term A Lender at any time, its obligation to make Term A Loans to the
Borrower in an aggregate amount equal to the amount set forth opposite such
Lender’s name in Schedule I hereto under the heading “Term
Loan A Commitment”

 

24

 

and/or in an Increase Joinder as such amount
may be changed from time to time in accordance with Section 4 and the
other applicable provisions hereof.

 

“Term
Loan A Termination Date”:  the
earliest to occur of (i) August 1, 2010, (ii) March 15, 2007 if
the Existing Notes shall be outstanding on such date and (iii) the
earliest date of maturity of any Indebtedness of the Borrower or any of its
Subsidiaries that refinances the Existing Notes.

 

“Term
Loan C Commitment”:  as to any Term C
Lender at any time, its obligation to make Term C Loans to the Borrower in
an aggregate amount equal to the amount of such Lender’s Term Loan C Commitment
(as defined in the Existing Credit Agreement) in effect under the Existing
Credit Agreement immediately prior to the execution of this Agreement and/or in
an Increase Joinder as such amount may be changed from time to time in
accordance with Section 4 and the other applicable provisions hereof.

 

“Term
Loan C Termination Date”:  the
earliest to occur of (i) July 24, 2009, (ii) March 15, 2007 if
the Existing Notes shall be outstanding on such date and (iii) the
earliest date of maturity of any Indebtedness of the Borrower or any of its
Subsidiaries that refinances the Existing Notes.

 

“Term
Loan Commitment”:  as to any Lender
at any time, the sum of its Term Loan A Commitment and Term Loan C
Commitment and its commitment, if elected, to make Incremental Term Loans of a
new tranche pursuant to subsection 2.9.

 

“Term
Loans”:  as defined in subsection
2.6.

 

“Term
Note”:  as defined in subsection
2.8(f).

 

“Total
Loan Percentage”:  as to any Lender
at any time, the percentage which (i) the sum of (x) such Lender’s
Revolving Credit Commitment (or, if the Revolving Credit Commitments have
terminated or expired at such time, the Aggregate Revolving Credit Outstanding
of such Lender) at such time plus (y) the sum of such Lender’s Available Term
Loan Commitment and the aggregate principal amount of Term Loans outstanding
for such Lender then constitutes of (ii) the sum of (x) the Aggregate
Revolving Credit Commitments (or, if the Revolving Credit Commitments have
terminated or expired at such time, the Aggregate Revolving Credit Outstanding
of all Lenders) plus (y) the sum of the Aggregate Available Term Loan
Commitments and the aggregate principal amount of Term Loans outstanding for
all Lenders at such time.

 

“Trailing”:  with respect to the determination of any
financial results for any period, the applicable financial result for the four
fiscal quarters ended on such date.

 

25

 

“Tranche”:  the collective reference to Eurodollar Loans
the then current Interest Periods with respect to which begin on the same date
and end on the same later date (whether or not such Loans shall originally have
been made on the same day).

 

“Transactions”:  the Solgar Acquisition, the Extensions of
Credit made hereunder on the Effective Date and the payment of fees,
commissions and expenses in connection therewith (including any payment by the
Borrower pursuant to the Solgar Purchase Agreement).

 

“Transferee”:  as defined in subsection 11.15.

 

“Type”:  as to any Loan, its nature as an ABR Loan or
a Eurodollar Loan.

 

“Withdrawal
Liability”:  liability to a Multiemployer
Plan as a result of a complete or partial withdrawal from such Multiemployer
Plan, as such terms are defined in Part I of Subtitle E of Title IV
of ERISA.

 

“Wyeth”:  as defined in the recitals hereto.

 

1.2.          Other Definitional Provisions.

 

(a)           Unless otherwise specified therein, all terms
defined in this Agreement shall have the defined meanings when used in the
Notes, the other Loan Documents or any certificate or other document made or
delivered pursuant hereto.

 

(b)           As used herein and in the Notes and any other
Loan Document, and any certificate or other document made or delivered pursuant
hereto or thereto, accounting terms relating to the Borrower and its
Subsidiaries not defined in subsection 1.1 and accounting terms partly defined
in subsection 1.1, to the extent not defined, shall have the respective
meanings given to them under GAAP; provided that, if the Borrower
notifies the Administrative Agent that the Borrower requests an amendment to
any provision hereof to eliminate the effect of any change occurring after the
date hereof in GAAP or in the application thereof on the operation of such
provision (or if the Administrative Agent notifies the Borrower that the
Majority Lenders request an amendment to any provision hereof for such purpose),
regardless of whether any such notice is given before or after such change in
GAAP or in the application thereof, then such provision shall be interpreted on
the basis of GAAP as in effect and applied immediately before such change shall
have become effective until such notice shall have been withdrawn or such
provision amended in accordance herewith.

 

(c)           The words “hereof,” “herein” and “hereunder”
and words of similar import when used in this Agreement shall refer to this
Agreement as a whole and not to any particular provision of this Agreement, and
Section, subsection, Schedule and Exhibit references are to this Agreement
unless otherwise specified.

 

26

 

(d)           The meanings given to terms defined herein shall
be equally applicable to both the singular and plural forms of such terms.

 

SECTION 2.  AMOUNT AND TERMS OF COMMITMENTS

 

2.1.          Revolving Credit Commitments.

 

(a)           Subject to the terms and conditions hereof,
each Lender with a Revolving Credit Commitment severally agrees to make
revolving credit loans (each, a “Revolving Credit Loan”) in U.S. Dollars
to the Borrower from time to time during the Revolving Credit Commitment Period
so long as after giving effect thereto (i) the Available Revolving Credit
Commitment of each Lender with a Revolving Credit Commitment is greater than or
equal to zero and (ii) the Aggregate Revolving Credit Outstanding of all
Lenders does not exceed the Aggregate Revolving Credit Commitments.  During the Revolving Credit Commitment Period
the Borrower may use the Revolving Credit Commitments by borrowing, prepaying
the Revolving Credit Loans in whole or in part, and reborrowing, all in
accordance with the terms and conditions hereof.

 

(b)           The Revolving Credit Loans may from time to
time be (i) Eurodollar Loans, (ii) ABR Loans or (iii) a
combination thereof, as determined by the Borrower and notified to the
Administrative Agent in accordance with subsections 2.2 and 4.2, provided
that no Revolving Credit Loan shall be made as a Eurodollar Loan after the day
that is one month prior to the Revolving Credit Termination Date.

 

2.2.          Procedure
for Revolving Credit Borrowing.  The Borrower may borrow under the Revolving
Credit Commitments during the Revolving Credit Commitment Period on any Business
Day, provided that the Borrower shall give the Administrative Agent
irrevocable notice (which notice must be received by the Administrative Agent
prior to 11:00 A.M., (New York City time) at least (a) three Business Days
prior to the requested Borrowing Date, if all or any part of the requested
Revolving Credit Loans are to be initially Eurodollar Loans, or (b) one
Business Day prior to the requested Borrowing Date, otherwise), specifying in
each case (i) the amount to be borrowed, (ii) the requested Borrowing
Date, (iii) whether the borrowing is to be of Eurodollar Loans, ABR Loans
or a combination thereof and (iv) if the borrowing is to be entirely or
partly of Eurodollar Loans, the amount of such Type of Loan and the length of
the initial Interest Periods therefor; provided that until the date that
is one month after the Closing Date, Eurodollar Loans may be made only for one
month Interest Periods.  Each borrowing
under the Revolving Credit Commitments shall be in an amount equal to (A) in
the case of ABR Loans, $1,000,000 or a whole multiple of $1,000,000 in excess
thereof (or, if the then Aggregate Available Revolving Credit Commitments are
less than $1,000,000, such lesser amount) and (B) in the case of
Eurodollar Loans, $5,000,000 or a whole multiple of $5,000,000 in excess
thereof.  Upon receipt of any such notice
from the Borrower, the Administrative Agent shall promptly notify each Lender
thereof not later than 9:00 A.M., New York City time, on the requested
Borrowing Date.  Not later than 12:00
Noon, New York City time, on each requested Borrowing Date each Lender shall
make an amount equal to its Revolving Credit Commitment Percentage of the
principal

 

27

 

amount of the Revolving Credit Loans requested
to be made on such Borrowing Date available to the Administrative Agent at its
office specified in subsection 11.2 in U.S. Dollars and in immediately
available funds.  The Administrative
Agent shall on such date credit the account of the Borrower on the books of
such office with the aggregate of the amounts made available to the
Administrative Agent by the Lenders and in like funds as received by the
Administrative Agent.

 

2.3.          Repayment of Revolving Credit Loans;
Evidence of Debt.

 

(a)           The Borrower hereby unconditionally promises
to pay to the Administrative Agent for the account of each Lender the then
unpaid principal amount of each Revolving Credit Loan of such Lender (whether
made before or after the termination or expiration of the Revolving Credit
Commitments) on the Revolving Credit Termination Date and on such other dates
and in such other amounts as may be required from time to time pursuant to this
Agreement.  The Borrower hereby further
agrees to pay interest on the unpaid principal amount of the Revolving Credit
Loans from time to time outstanding until payment thereof in full at the rates
per annum, and on the dates, set forth in subsection 4.1.

 

(b)           Each Lender shall maintain in accordance with
its usual practice an account or accounts evidencing indebtedness of the
Borrower to such Lender resulting from each Revolving Credit Loan of such
Lender from time to time, including the amounts of principal and interest
payable thereon and paid to such Lender from time to time under this Agreement.

 

(c)           The Administrative Agent shall maintain the
Register pursuant to subsection 11.6(b), and a subaccount therein for each
Lender, in which shall be recorded (i) the amount of each Revolving Credit
Loan made hereunder, the Type thereof and each Interest Period applicable
thereto, (ii) the amount of any principal or interest due and payable or
to become due and payable from the Borrower to each Lender hereunder in respect
of the Revolving Credit Loans and (iii) both the amount of any sum received
by the Administrative Agent hereunder from the Borrower in respect of the
Revolving Credit Loans and each Lender’s share thereof.

 

(d)           The entries made in the Register and the
accounts of each Lender maintained pursuant to subsection 2.3(b) shall, to the
extent permitted by applicable law, be prima facie evidence of the existence
and amounts of the obligations of the Borrower therein recorded; provided,
however, that the failure of any Lender to maintain such account or the
Administrative Agent to maintain the Register, or any error therein, shall not
in any manner affect the obligation of the Borrower to repay (with applicable
interest) the Revolving Credit Loans made to the Borrower by such Lender in
accordance with the terms of this Agreement.

 

(e)           The Borrower agrees that it will, upon the
request of any Lender, execute and deliver to such Lender (i) a promissory
note of the Borrower evidencing the Revolving Credit Loans of such Lender,
substantially in the form attached hereto as Exhibit A-1 with
appropriate insertions as to date and principal amount (each, a “Revolving
Credit Note”), and/or (ii) a promissory note of the Borrower
evidencing the Swing Line Loans of such Lender, substantially

 

28

 

in the form attached hereto as Exhibit A-2
with appropriate insertions as to date and principal amount (each, a “Swing
Line Note”); provided that any Revolving Credit Note or Swing Line
Note previously delivered to such Lender (or any predecessor thereof) has been
returned to the Borrower and marked cancelled or an affidavit of lost or
destroyed Note (in form acceptable to the Borrower) is executed and delivered
by such requesting Lender in lieu of such Note.

 

2.4.          Termination
or Reduction of Revolving Credit Commitments.  The Borrower shall have the
right, upon not less than three Business Days’ notice to the Administrative
Agent (which shall promptly notify each Lender thereof), to terminate the
Revolving Credit Commitments or, from time to time, to reduce the amount of the
Revolving Credit Commitments; provided that no such termination or
reduction shall be permitted if, after giving effect thereto and to any
prepayments of the Revolving Credit Loans made on the effective date thereof,
the Available Revolving Credit Commitment of any Lender would not be greater
than or equal to zero.  Any such
permitted reduction shall be in an amount equal to $2,500,000 or a whole
multiple of $1,000,000 in excess thereof and shall reduce permanently the
Revolving Credit Commitments then in effect.

 

2.5.          Swing Line Commitment.

 

(a)           Subject to the terms and conditions hereof,
the Swing Line Lender agrees to make swing line loans (individually, a “Swing
Line Loan”; collectively, the “Swing Line Loans”) to the Borrower
from time to time during the Revolving Credit Commitment Period in an aggregate
principal amount at any one time outstanding not to exceed $5,000,000; provided
that the Swing Line Lender shall not make any Swing Line Loan if, after giving
effect thereto, the sum of the Swing Line Loans, the Revolving Credit Loans and
the Letter of Credit Obligations (in each case after giving effect to the Loans
requested to be made and the Letters of Credit requested to be issued on such
date) exceeds the Aggregate Revolving Credit Commitments.  During the Revolving Credit Commitment
Period, the Borrower may use the Swing Line Commitment by borrowing, prepaying
the Swing Line Loans in whole or in part, and reborrowing, all in accordance
with the terms and conditions hereof. 
All Swing Line Loans shall be made as ABR Loans and shall not be
entitled to be converted into Eurodollar Loans. 
The Borrower shall give the Swing Line Lender irrevocable notice (which
notice must be received by the Swing Line Lender prior to 12:00 Noon, New York
City time) on the requested Borrowing Date specifying the amount of the
requested Swing Line Loan which shall be in a minimum amount of $100,000 or a
whole multiple of $100,000 in excess thereof. 
The proceeds of the Swing Line Loan will be made available by the Swing
Line Lender to the Borrower at the Houston office of the Swing Line Lender set
forth in subsection 11.2, or at such other address the Swing Line Lender shall
designate in writing to the Borrower from time to time in accordance with
subsection 11.2, by 3:00 P.M., New York City time, on the Borrowing Date
by crediting the account of the Borrower at such office with such
proceeds.  The Borrower may at any time
and from time to time prepay the Swing Line Loans, in whole or in part, without
premium or penalty, by notifying the Swing Line Lender prior to 12:00 Noon, New
York City time, on any Business Day of the date and

 

29

 

amount of prepayment.  If any such notice is given, the amount
specified in such notice shall be due and payable on the date specified
therein.  Partial prepayments shall be in
an aggregate principal amount of $100,000 or a whole multiple of $100,000 in
excess thereof.

 

(b)           The Swing Line Lender, at any time in its
sole and absolute discretion, may, on behalf of the Borrower (which hereby
irrevocably directs the Swing Line Lender to act on its behalf) request each
Lender, including the Swing Line Lender, to make a Revolving Credit Loan which
is an ABR Loan in an amount equal to such Lender’s Revolving Credit Commitment
Percentage of the amount of the Swing Line Loans outstanding on the date such
notice is given (the “Refunded Swing Line Loans”).  Unless any of the events described in
paragraph (h) of Section 9 shall have occurred with respect to the Borrower (in
which event the procedures of paragraph (d) of this subsection 2.5 shall
apply), each Lender shall make the proceeds of such Revolving Credit Loan
available to the Administrative Agent for the account of the Swing Line Lender
at the office of the Administrative Agent specified in subsection 11.2 prior to
12:00 Noon (New York City time) in funds immediately available on the Business
Day next succeeding the date such notice is given.  The proceeds of such Revolving Credit Loans
shall be immediately applied to repay the Refunded Swing Line Loans.  Effective on the day such Revolving Credit
Loans are made, the portion of the Swing Line Loans so paid shall no longer be
outstanding as Swing Line Loans, shall no longer be due under any Swing Line
Note and shall be due as the respective Revolving Credit Loans made by the
Lenders in accordance with their respective Revolving Credit Commitment
Percentages.  The Borrower hereby
unconditionally promises to pay to the Administrative Agent for the account of
the Swing Line Lender the then unpaid principal amount of each Swing Line Loan
of the Swing Line Lender on the Revolving Credit Termination Date (to the
extent such Swing Line Loan has not previously been repaid in full with the
proceeds of Revolving Credit Loans).

 

(c)           Notwithstanding anything herein to the
contrary, the Swing Line Lender shall not be obligated to make any Swing Line
Loans if the conditions set forth in subsection 6.2 have not been satisfied in
respect thereof.

 

(d)           If prior to the making of a Revolving Credit
Loan pursuant to paragraph (b) of this subsection 2.5 one of the events
described in paragraph (h) of Section 9 shall have occurred and be continuing
with respect to the Borrower, each Lender with a Revolving Credit Commitment
will, on the date such Revolving Credit Loan was to have been made pursuant to
the notice in this subsection 2.5, purchase an undivided participating interest
in the Refunded Swing Line Loans in an amount equal to (i) its Revolving
Credit Commitment Percentage times (ii) the Refunded Swing Line
Loans.  Each Lender will immediately
transfer to the Swing Line Lender, in immediately available funds, the amount
of its participation, and upon receipt thereof the Swing Line Lender will
deliver to such Lender a Swing Line Loan Participation Certificate dated the
date of receipt of such funds and in such amount.

 

(e)           Whenever, at any time after any Lender has
purchased a participating interest in a Swing Line Loan, the Swing Line Lender
receives any payment on account thereof,

 

30

 

the Swing Line Lender will distribute to such
Lender its participating interest in such amount (appropriately adjusted, in
the case of interest payments, to reflect the period of time during which such
Lender’s participating interest was outstanding and funded); provided, however,
that in the event that such payment received by the Swing Line Lender is
required to be returned, such Lender will return to the Swing Line Lender any
portion thereof previously distributed by the Swing Line Lender to it.

 

(f)            Each Lender’s obligation to make the Loans
referred to in subsection 2.5(b) and to purchase participating interests
pursuant to subsection 2.5(d) shall be absolute, irrevocable and unconditional
and shall not be affected by any circumstance, including, without limitation,
(i) any set-off, counterclaim, recoupment, defense or other right which
such Lender or the Borrower may have against the Swing Line Lender, the
Borrower or any other Person for any reason whatsoever, (ii) the
occurrence or continuance of a Default or an Event of Default; (iii) any
adverse change in the condition (financial or otherwise) of the Borrower or any
other Loan Party; (iv) any breach of this Agreement or any other Loan
Document by the Borrower or any of its Subsidiaries or any other Lender; or
(v) any other circumstance, happening or event whatsoever, whether or not
similar to any of the foregoing.

 

2.6.          Term
Loan Commitments.  On December 19, 2003 each Lender with a Term
Loan C Commitment made a Term C Loan (each, a “Term C Loan”) in the
amount of its Term Loan C Commitment on such date.  On the Effective Date, each Lender with a
Term Loan A Commitment shall, notwithstanding anything in subsection 2.7
or any other provision of this Agreement requiring such funding to occur or
requiring Term A Loans to be made in any minimum or multiple amount, make a
term loan to the Borrower (each, a “Term A Loan,” and, together
with the Term C Loan and any Incremental Term Loans made pursuant to
subsection 2.9, the “Term Loans”) in an aggregate principal amount set
forth opposite such Lender’s name on Schedule I under the heading
“Term A Loan Commitment.”  The Term
Loans may from time to time be (a) Eurodollar Loans, (b) ABR Loans or (c) a
combination thereof, as determined by the Borrower and notified to the
Administrative Agent in accordance with subsections 2.7 and 4.2.

 

2.7.          Procedure
for Term Loan Borrowing.  The Borrower may borrow under the Term A Loan
Commitments only on the Effective Date; provided that the Borrower shall
give the Administrative Agent irrevocable notice (which notice must be received
by the Administrative Agent prior to 11:00 A.M.  (New York City time) at least (a) three
Business Days prior to the Effective Date, if all or any part of the requested
Term Loans are to be initially Eurodollar Loans, or (b) one Business Day prior
to the Effective Date, otherwise), specifying in each case (i) the amount
to be borrowed, (ii) the requested Effective Date, (iii) whether the
borrowing is to be of Eurodollar Loans, ABR Loans or a combination thereof,
(iv) if the borrowing is to be entirely or partly of Eurodollar Loans, the
amount of such Type of Loan and the length of the initial Interest Periods
therefor, and (v) the amount of Term A Loans.  The Term Loan Commitments shall expire at
5:00 P.M., New York City time, on the Effective Date, whether or not the
Term Loans thereunder are made.  Each
borrowing under the Term Loan Commitments shall be in an amount equal to
(A) in the case of ABR Loans, $1,000,000 or a whole multiple of $1,000,000
in

 

31

 

excess thereof and (B) in the case of
Eurodollar Loans, $5,000,000 or a whole multiple of $5,000,000 in excess
thereof.  Upon receipt of any such notice
from the Borrower, the Administrative Agent shall promptly notify each Lender
thereof not later than 9:00 A.M., New York City time, on the Effective
Date.  Not later than 12:00 Noon, New
York City time, on the Effective Date, each Lender shall make an amount equal
to its Term A Loan Commitment available to the Administrative Agent at its
office specified in subsection 11.2 in U.S. Dollars and in immediately
available funds.  The Administrative
Agent shall on such date credit the account of the Borrower on the books of
such office with the aggregate of the amounts made available to the
Administrative Agent by the Lenders and in like funds as received by the
Administrative Agent.

 

2.8.          Repayment of Term Loans; Evidence of Debt.

 

(a)           The aggregate amount of Term A Loans and
Term C Loans, as the case may be, of all the Lenders outstanding on the
Term Loan A Termination Date and the Term Loan C Termination Date, as
the case may be, shall be paid on such date. 
Prior to such Term Loan A Termination Date or Term Loan C
Termination Date, the Borrower shall pay quarterly installments on the dates
set forth below in a principal amount equal to the amounts set forth opposite
such date:

 

	
  Dates

  	
   

  	
  Term

  Loan A

  Installment

  	
   

  	
  Term

  Loan C

  Installment

  	
   

  
	
  September 30, 2005

  	
   

  	
  $

  	
  0

  	
   

  	
  $

  	
  352,838

  	
   

  
	
  December 31, 2005

  	
   

  	
  $

  	
  0

  	
   

  	
  $

  	
  352,838

  	
   

  
	
  March 31, 2006

  	
   

  	
  $

  	
  0

  	
   

  	
  $

  	
  352,838

  	
   

  
	
  June 30, 2006

  	
   

  	
  $

  	
  0

  	
   

  	
  $

  	
  352,838

  	
   

  
	
  September 30, 2006

  	
   

  	
  $

  	
  4,500,000

  	
   

  	
  $

  	
  352,838

  	
   

  
	
  December 31, 2006

  	
   

  	
  $

  	
  4,500,000

  	
   

  	
  $

  	
  352,838

  	
   

  
	
  March 31, 2007

  	
   

  	
  $

  	
  4,500,000

  	
   

  	
  $

  	
  352,838

  	
   

  
	
  June 30, 2007

  	
   

  	
  $

  	
  4,500,000

  	
   

  	
  $

  	
  352,838

  	
   

  
	
  September 30, 2007

  	
   

  	
  $

  	
  4,500,000

  	
   

  	
  $

  	
  352,838

  	
   

  
	
  December 31, 2007

  	
   

  	
  $

  	
  4,500,000

  	
   

  	
  $

  	
  352,838

  	
   

  
	
  March 31, 2008

  	
   

  	
  $

  	
  4,500,000

  	
   

  	
  $

  	
  352,838

  	
   

  
	
  June 30, 2008

  	
   

  	
  $

  	
  4,500,000

  	
   

  	
  $

  	
  352,838

  	
   

  
	
  September 30, 2008

  	
   

  	
  $

  	
  4,500,000

  	
   

  	
  $

  	
  33,519,621

  	
   

  
	
  December 31, 2008

  	
   

  	
  $

  	
  4,500,000

  	
   

  	
  $

  	
  33,519,621

  	
   

  
	
  March 31, 2009

  	
   

  	
  $

  	
  4,500,000

  	
   

  	
  $

  	
  33,519,621

  	
   

  
	
  June 30, 2009

  	
   

  	
  $

  	
  4,500,000

  	
   

  	
  $

  	
  33,872,461

  	
   

  
	
  September 30, 2009

  	
   

  	
  $

  	
  16,500,000

  	
   

  	
  —

  	
   

  
	
  December 31, 2009

  	
   

  	
  $

  	
  16,500,000

  	
   

  	
  —

  	
   

  
	
  March 31, 2010

  	
   

  	
  $

  	
  16,500,000

  	
   

  	
  —

  	
   

  
	
  Five year anniversary of Effective Date

  	
   

  	
  $

  	
  16,500,000

  	
   

  	
  —

  	
   

  

 

32

 

The
amounts set forth in the table above shall be automatically reduced upon
application of any prepayment pursuant to subsection 4.4 in the manner set
forth in subsection 4.8(a).

 

(b)           The Borrower hereby unconditionally promises
to pay to the Administrative Agent for the account of each Lender the amounts
specified in subsection 2.8(a) on the dates specified in subsection 2.8(a) and
on such other dates and in such other amounts as may be required from time to
time pursuant to this Agreement.  The
Borrower hereby further agrees to pay interest on the unpaid principal amount
of the Term Loans from time to time outstanding until payment thereof in full
at the rates per  annum, and on the dates, set forth in subsection
4.1.

 

(c)           Each Lender shall maintain in accordance with
its usual practice an account or accounts evidencing indebtedness of the
Borrower to such Lender resulting from each Term Loan of such Lender from time
to time, including the amounts of principal and interest payable thereon and
paid to such Lender from time to time under this Agreement.

 

(d)           The Administrative Agent shall maintain the
Register pursuant to subsection 11.6(b), and a sub-account therein for each
Lender, in which shall be recorded (i) the amount of each Term Loan made
hereunder, the Type thereof and each Interest Period applicable thereto,
(ii) the amount of any principal or interest due and payable or to become
due and payable from the Borrower to each Lender hereunder in respect of the
Term Loans, (iii) whether such Term Loan is a Term A Loan or a
Term C Loan and (iv) both the amount of any sum received by the
Administrative Agent hereunder from the Borrower in respect of the Term Loans
and each Lender’s share thereof.

 

(e)           The entries made in the Register and the
accounts of each Lender maintained pursuant to subsection 2.8(c) shall, to the
extent permitted by applicable law, be prima facie evidence of the existence
and amounts of the obligations of the Borrower therein recorded; provided,
however, that the failure of any Lender to maintain such account or the
Administrative Agent to maintain the Register, or any error therein, shall not
in any manner affect the obligation of the Borrower to repay (with applicable
interest) the Term Loans made to the Borrower by such Lender in accordance with
the terms of this Agreement.

 

(f)            The Borrower agrees that it will, upon the
written request of any Lender, execute and deliver to such Lender a promissory
note of the Borrower evidencing the Term Loans of such Lender, substantially in
the form attached hereto as Exhibit A-3 in the case of Term A
Loans and Exhibit A-4 in the case of Term C Loans, with
appropriate insertions as to date and principal amount (each, a “Term Note”);
provided that any Term Note previously delivered to such Lender (or any
predecessor thereof) has been returned to the Borrower and marked

 

33

 

cancelled or an affidavit of lost or
destroyed Note (in form acceptable to the Borrower) is executed and delivered
by such requesting Lender in lieu of such Note.

 

2.9.          Increased Commitments.

 

(a)           The Borrower may by written notice to the
Administrative Agent (who shall promptly notify each of the Lenders) elect to
request the establishment of one or more new term loan Commitments (each, an “Incremental
Term Loan Commitment”) by an
amount not in excess of $150,000,000 in the aggregate and not less than $75,000,000
individually.  The new Commitments may be
of an existing or a new Class of Term Loans. 
Each such notice shall specify (i) the date (each, an “Increase
Effective Date”) on which the
Borrower proposes that the increased or new Commitments shall be effective,
which shall be a date not fewer than 10 Business Days after the date on which
such notice is delivered to the Administrative Agent and (ii) the identity of
each Lender and each New Lender (which New Lender shall be reasonably
acceptable to the Administrative Agent) to whom the Borrower proposes any
portion of such increased or new Commitments be allocated and the amounts of
such allocations; provided that any
existing Lender approached to provide all or a portion of the increased or new
Commitments may elect or decline, in its sole discretion, to provide such
increased or new Commitment.

 

(b)           Each Incremental Term Loan Commitment shall
become effective, as of such Increase Effective Date; provided that:

 

(i)            each of the conditions set forth in subsection
6.2 shall be satisfied;

 

(ii)           no Default or Event of Default shall have
occurred and be continuing or would result from the borrowings to be made on
the Increase Effective Date;

 

(iii)          after giving pro forma effect to the
borrowings to be made on the Increase Effective Date and to any change in
Consolidated EBITDA and any increase in Consolidated Indebtedness resulting
from the consummation of any acquisition or disposition permitted by this
Agreement concurrently with such borrowings as of the date of the most recent
financial statements delivered pursuant to subsection 7.2(b), the
Borrower shall be in compliance with each of the covenants set forth in subsection
8.1 by a margin between the then applicable covenant and the Borrower’s pro forma performance of at least 0.25 on such
date and for the most recent determination period; and

 

(iv)          the Borrower shall deliver or cause to be
delivered any legal opinions or other documents reasonably requested by the
Administrative Agent in connection with any such transaction.

 

(c)           Certain terms and provisions of Term Loans
made pursuant to Incremental Term Loan Commitments (“Incremental Term Loans”)
shall be as follows:

 

34

 

(i)            amortization payments shall be no more than
ratable with the amortization payments under any existing tranche of the Term
Loans, and the Incremental Term Loans shall otherwise be no more than pari passu with the existing Term Loans with
respect to mandatory prepayments and other payment rights;

 

(ii)           the maturity date of Incremental Term Loans
shall not be earlier than the maturity of any other Class of Term Loans
outstanding under this Agreement; and

 

(iii)          the applicable margins for the Incremental
Term Loans shall be determined by the Borrower and the New Lenders; provided, however, that the applicable margins for the
Incremental Term Loans shall not be greater than the Applicable Margin payable
with respect to Term C Loans plus 25 basis points.

 

Each
Incremental Term Loan Commitment shall be effected by a joinder agreement (the
“Increase Joinder”) executed by Borrower, the Administrative Agent and
each Lender making such Incremental Term Loan Commitment, in form and substance
reasonably satisfactory to each of them. 
The Increase Joinder may, without the consent of any other Lenders,
effect such amendments to this Agreement and the other Loan Documents as may be
necessary or appropriate, in the reasonable opinion of the Administrative
Agent, to give effect to the provisions of this subsection 2.9.

 

(d)           On any Increase Effective Date on which new
Commitments for Incremental Term Loans are effective, subject to the
satisfaction of the foregoing terms and conditions, each Lender of such
Incremental Term Loan Commitment shall make an Incremental Term Loan to the
Borrower in an amount equal to its Incremental Term Loan Commitment.

 

(e)           The Loans and Commitments established
pursuant to this subsection 2.9 shall constitute Loans and Commitments under,
and shall be entitled to all the benefits afforded by, this Agreement and the
other Loan Documents, and shall, without limiting the foregoing, benefit
equally and ratably from the guarantee of the Borrower’s Obligations under the
Guarantee and Collateral Agreement and security interests created by the Security
Documents.  The Loan Parties shall take
any actions reasonably required by the Administrative Agent to ensure and/or
demonstrate that the Liens and security interests granted by the Security
Documents continue to be perfected under the New York UCC (as defined in the
Guarantee and Collateral Agreement) or otherwise after giving effect to the
establishment of any such Class of Term Loans or any such new Commitments.

 

SECTION 3.  LETTERS OF CREDIT

 

3.1.          Letters
of Credit.  Subject to the terms and conditions of this
Agreement, the Issuing Lender agrees, on behalf of the Lenders, and in reliance
on the agreement of the Lenders set forth in subsection 3.3, to issue for the
account of the Borrower letters of credit in an aggregate face amount, together
with any unpaid Reimbursement Obligations, not to exceed $10,000,000 at any
time outstanding, as follows:

 

35

 

(i)            standby letters of credit (collectively, the
“Standby Letters of Credit”) in a form reasonably satisfactory to the
Issuing Lender and in favor of such beneficiaries as the Borrower shall specify
from time to time (which shall be reasonably satisfactory to the Issuing
Lender); and

 

(ii)           commercial letters of credit in the form of
the Issuing Lender’s standard commercial letters of credit (“Commercial
Letters of Credit”) in favor of sellers of goods or services to the
Borrower or its Subsidiaries (the Standby Letters of Credit and Commercial
Letters of Credit being referred to collectively as the “Letters of Credit”);

 

provided that on the date of the issuance of any
Letter of Credit, and after giving effect to such issuance, the Aggregate
Revolving Credit Outstanding of all Lenders does not exceed the Aggregate
Revolving Credit Commitments at such time. 
Each Standby Letter of Credit shall (i) have an expiry date no
later than one year from the date of issuance thereof or, if earlier, five
Business Days prior to the Revolving Credit Termination Date, (ii) be
denominated in U.S. Dollars and (iii) be in a minimum face amount of
$100,000.  Each Commercial Letter of
Credit shall (i) provide for the payment of sight drafts when presented
for honor thereunder, or of time drafts, in each case in accordance with the
terms thereof and when accompanied by the documents described or when such
documents are presented, as the case may be, (ii) be denominated in U.S.
Dollars and (iii) have an expiry date no later than six months from the
date of issuance thereof or, if earlier, five Business Days prior to the
Revolving Credit Termination Date.  Upon
the issuance of any Letter of Credit, the Administrative Agent shall promptly
notify each Lender thereof.

 

3.2.          Procedure
for Issuance of Letters of Credit.  The Borrower may from time to time request,
upon at least three Business Days’ notice, the Issuing Lender to issue a Letter
of Credit by delivering to the Issuing Lender at its address specified in
subsection 11.2 a Letter of Credit Application, completed to the reasonable
satisfaction of such Issuing Lender, together with such other certificates,
documents and other papers and information as such Issuing Lender may
reasonably request.  Upon receipt of any
Letter of Credit Application, the Issuing Lender will process such Letter of
Credit Application, and the other certificates, documents and other papers
delivered in connection therewith, in accordance with its customary procedures
and shall promptly issue such Letter of Credit (but in no event earlier than
three Business Days after receipt by the Issuing Lender of the Letter of Credit
Application relating thereto) by issuing the original of such Letter of Credit
to the beneficiary thereof and by furnishing a copy thereof to the
Borrower.  Prior to the issuance of any
Letter of Credit, the Issuing Lender will confirm with the Administrative Agent
that the issuance of such Letter of Credit is permitted pursuant to Section 3
and subsection 6.2.  Additionally, the
Issuing Lender and the Borrower shall inform the Administrative Agent of any
modifications made to outstanding Letters of Credit, of any payments made with
respect to such Letters of Credit, and of any other information regarding such
Letters of Credit as may be reasonably requested by the Administrative Agent,
in each case pursuant to procedures established by the Administrative Agent.

 

36

 

3.3.          Participating
Interests.  Effective as of the date of the issuance of
each Letter of Credit (in the case of a Letter of Credit issued after the date
hereof), the Issuing Lender agrees to allot, and does allot, to each other
Lender with a Revolving Credit Commitment, and each such Lender severally and
irrevocably agrees to take and does take, a Participating Interest in such
Letter of Credit and the related Letter of Credit Application in a percentage
equal to such Lender’s Revolving Credit Commitment Percentage.  On the date that any Participating Lender
becomes a party to this Agreement in accordance with subsection 11.6,
Participating Interests in any outstanding Letter of Credit held by the Lender
from which such Participating Lender acquired its interest hereunder shall be
proportionately reallocated between such Participating Lender and such
transferor Lender.  Each Participating
Lender hereby agrees that its obligation to participate in each Letter of
Credit issued in accordance with the terms hereof and to pay or to reimburse
the Issuing Lender in respect of such Letter of Credit for its participating
share of the drafts drawn thereunder shall be irrevocable and unconditional; provided
that no Participating Lender shall be liable for the payment of any amount
under subsection 3.4(b) resulting solely from the Issuing Lender’s gross
negligence or willful misconduct.

 

3.4.          Payments.

 

(a)           The Borrower agrees (i) to reimburse the
Administrative Agent for the account of the Issuing Lender, forthwith upon its
demand and otherwise in accordance with the terms of the Letter of Credit Application,
if any, relating thereto, for any payment made by the Issuing Lender under any
Letter of Credit and (ii) to pay to the Administrative Agent for the
account of such Issuing Lender, interest on any unreimbursed portion of any
such payment from the date of such payment until reimbursement in full thereof
at a fluctuating rate per  annum equal to the rate then borne by
Revolving Credit Loans that are ABR Loans pursuant to subsection 4.1(b) plus 2%
per  annum.

 

(b)           In the event that the Issuing Lender makes a
payment under any Letter of Credit and is not reimbursed in full therefor,
forthwith upon demand of the Issuing Lender, and otherwise in accordance with
the terms hereof or of the Letter of Credit Application, if any, relating to
such Letter of Credit, the Issuing Lender will promptly through the
Administrative Agent notify each Participating Lender that acquired its
Participating Interest in such Letter of Credit from the Issuing Lender or
pursuant to an assignment as provided in subsection 11.6(c).  No later than (x) the close of business on
the date such notice is given if such notice is given by 12:00 Noon (New York
City time) on the date such notice is received or (y) 12:00 Noon (New York City
time) on the following Business Day if such notice is not received by 12:00
Noon (New York City time), each such Participating Lender will transfer to the
Administrative Agent, for the account of the Issuing Lender, in immediately
available funds, an amount equal to such Participating Lender’s pro  rata
share of the unreimbursed portion of such payment.

 

(c)           Whenever, at any time, after the Issuing
Lender has made payment under a Letter of Credit and has received from any
Participating Lender such Participating Lender’s pro  rata share
of the unreimbursed portion of such payment, the Issuing Lender receives any
reimbursement

 

37

 

on account of such unreimbursed portion or
any payment of interest on account thereof, the Issuing Lender will distribute
to the Administrative Agent, for the account of such Participating Lender, its pro
rata share thereof; provided, however, that in the event
that the receipt by the Issuing Lender of such reimbursement or such payment of
interest (as the case may be) is required to be returned, such Participating
Lender will promptly return to the Administrative Agent, for the account of the
Issuing Lender, any portion thereof previously distributed by the Issuing
Lender to it.

 

3.5.          Further
Assurances.  The Borrower hereby agrees, from time to
time, to do and perform any and all acts and to execute any and all further
instruments reasonably requested by the Issuing Lender more fully to effect the
purposes of this Agreement and the issuance of the Letters of Credit issued
hereunder.

 

3.6.          Obligations
Absolute.  The payment obligations of the Borrower and
each Participating Lender under subsection 3.4 shall be unconditional and
irrevocable and shall be paid strictly in accordance with the terms of this
Agreement under all circumstances, including, without limitation, the following
circumstances:

 

(a)           the existence of any claim, set-off,
defense or other right which the Borrower may have at any time against any
beneficiary, or any transferee, of any Letter of Credit (or any Persons for
whom any such beneficiary or any such transferee may be acting), the Issuing
Lender or any Participating Lender, or any other Person, whether in connection
with this Agreement, the transactions contemplated herein, or any unrelated
transaction;

 

(b)           any statement or any other document
presented under any Letter of Credit opened for its account proving to be
forged, fraudulent, invalid or insufficient in any respect or any statement
therein being untrue or inaccurate in any respect;

 

(c)           payment by the Issuing Lender under any
Letter of Credit against presentation of a draft or certificate which does not
comply with the terms of such Letter of Credit, except payment resulting solely
from the gross negligence or willful misconduct of the Issuing Lender; or

 

(d)           any other circumstances or happening
whatsoever, whether or not similar to any of the foregoing, except
circumstances or happenings resulting from the gross negligence or willful
misconduct of the Issuing Lender.

 

3.7.          Letter
of Credit Application.  To the extent not inconsistent with the terms
of this Agreement (in which case the provisions of this Agreement shall
prevail), provisions of any Letter of Credit Application related to any Letter
of Credit are supplemental to, and not in derogation of, any rights and
remedies of the Issuing Lender and the Participating Lenders under this Section
3 and applicable law.  The Borrower
acknowledges and agrees that all rights of the Issuing Lender under any Letter
of Credit Application shall inure to the benefit of each Participating 

 

38

 

Lender to the extent of its Revolving Credit
Commitment Percentage as fully as if such Participating Lender was a party to
such Letter of Credit Application.

 

3.8.          Purpose
of Letters of Credit.  Each Standby Letter of Credit shall be used
by the Borrower solely (a) to provide credit support for borrowings by the
Borrower or its Subsidiaries, or (b) for other working capital purposes of the
Borrower and Subsidiaries in the ordinary course of business.  Each Commercial Letter of Credit will be used
by the Borrower and Subsidiaries solely to provide the primary means of payment
in connection with the purchase of goods or services by the Borrower and its
Subsidiaries in the ordinary course of business.

 

SECTION 4.  GENERAL PROVISIONS

 

4.1.          Interest Rates and Payment Dates.

 

(a)           Each Eurodollar Loan shall bear interest for
each day during each Interest Period with respect thereto at a rate per  annum
equal to the Eurodollar Rate determined for such Interest Period plus the
Applicable Margin.

 

(b)           Each ABR Loan shall bear interest for each
day on which it is outstanding at a rate per  annum equal to the
Alternate Base Rate for such day plus the Applicable Margin.

 

(c)           If all or a portion of (i) the principal
amount of any Loan, (ii) any interest payable thereon or (iii) any
fee or other amount payable hereunder shall not be paid when due (whether at
the stated maturity, by acceleration or otherwise), such amount shall bear
interest for each day after the due date until such amount is paid in full at a
rate per  annum equal to (x) in the case of principal, the rate
that would otherwise be applicable thereto pursuant to the foregoing provisions
of this subsection plus 2% per  annum or (y) in the case of any such
overdue interest, fee or other amount, the rate described in paragraph (b) of
this subsection plus 2% per  annum.  If any Event of Default described in
subsections 9(c) (with respect to subsection 8.1 only), (f), (h) or (j) shall
occur and be continuing, and the Majority Lenders shall give notice to the
Borrower that this sentence shall apply, then, until such Event of Default
shall be cured or waived or such notice shall be withdrawn, the outstanding
principal amount of all Loans shall bear interest at 2% per  annum
above the rate that would otherwise be applicable thereto pursuant to the
foregoing provisions of this subsection 4.1 (other than the first sentence of
this paragraph (c)).

 

(d)           Interest shall be payable in arrears on each
Interest Payment Date, provided that interest accruing pursuant to
paragraph (c) of this subsection 4.1 shall be payable from time to time on
demand.

 

4.2.          Conversion and Continuation Options.

 

(a)           The Borrower may elect from time to time to
convert outstanding Eurodollar Loans (in whole or in part) to ABR Loans by
giving the Administrative Agent at least two Business Days’ prior irrevocable
notice of such election, provided that any such conversion of

 

39

 

Eurodollar Loans may only be made on the last
day of an Interest Period with respect thereto. 
The Borrower may elect from time to time to convert outstanding ABR
Loans (in whole or in part) to Eurodollar Loans by giving the Administrative
Agent at least three Business Days’ prior irrevocable notice of such
election.  Any such notice of conversion
to Eurodollar Loans shall specify the length of the initial Interest Period or
Interest Periods therefor.  Upon receipt
of any such notice the Administrative Agent shall promptly notify each relevant
Lender thereof.  All or any part of
outstanding Eurodollar Loans and ABR Loans may be converted as provided herein,
provided that (i) no ABR Loan may be converted into a Eurodollar
Loan when any Default or Event of Default has occurred and is continuing and
the Administrative Agent or Lenders holding the majority of the outstanding
principal amount of Loans of such Type have determined that such conversion is
not appropriate, (ii) any such conversion may only be made if, after
giving effect thereto, subsection 4.3 shall not have been violated, and
(iii) no ABR Loan may be converted into a Eurodollar Loan after the date
that is one month prior to the Revolving Credit Termination Date.

 

(b)           Any Eurodollar Loans may be continued as such
upon the expiration of the then current Interest Period with respect thereto by
the Borrower giving notice to the Administrative Agent of the length of the
next Interest Period to be applicable to such Loans determined in accordance
with the applicable provisions of the term “Interest Period” set forth in
subsection 1.1, provided that no Eurodollar Loan may be continued as
such (i) when any Default or Event of Default has occurred and is
continuing and the Administrative Agent or Lenders holding the majority of the
outstanding principal amount of Loans of such Class have determined that such
continuation is not appropriate, (ii) if, after giving effect thereto,
subsection 4.3 would be contravened or (iii) after the date that is one
month prior to the Revolving Credit Termination Date; and provided, further,
that if the Borrower shall fail to give such notice or if such continuation is
not permitted pursuant to the preceding proviso, such Eurodollar Loans shall,
subject to the preceding proviso, be automatically continued as such, with the
length of the next Interest Period to be 30 days.  Upon receipt of any notice pursuant to this
subsection 4.2(b), the Administrative Agent shall promptly notify each Lender
thereof.

 

4.3.          Minimum
Amounts of Tranches.  All borrowings, conversions and continuations
of Loans hereunder and all selections of Interest Periods hereunder shall be in
such amounts and be made pursuant to such elections so that, after giving
effect thereto, (i) the aggregate principal amount of the Eurodollar Loans
comprising each Tranche shall be equal to $5,000,000 or a whole multiple of
$5,000,000 in excess thereof and (ii) there shall not be more than (ten)
10 Tranches at any one time outstanding.

 

4.4.          Optional and Mandatory Prepayments.

 

(a)           The Borrower may at any time and from time to
time prepay Revolving Credit Loans or Term Loans, in whole or in part, upon at
least three Business Days’ irrevocable notice to the Administrative Agent (in
the case of Eurodollar Loans) and at least one Business Day’s irrevocable
notice to the Administrative Agent (in the case of ABR Loans), specifying the

 

40

 

date and amount of prepayment and whether the
prepayment is (i) of Revolving Credit Loans or Term A Loans or
Term C Loans and (ii) of Eurodollar Loans, ABR Loans or a combination
thereof, and, in each case if a combination thereof, the amount allocable to
each.  Upon the receipt of any such
notice the Administrative Agent shall promptly notify each Lender thereof.  If any such notice is given, the amount
specified in such notice shall be due and payable on the date specified
therein.  Partial prepayments of the
Loans shall be in an aggregate principal amount of $2,500,000 or a whole multiple
of $1,000,000 in excess thereof.

 

(b)           If, at any time during the Revolving Credit
Commitment Period, for any reason the Aggregate Revolving Credit Outstanding of
all Lenders exceeds the Aggregate Revolving Credit Commitments then in effect,
or the Aggregate Revolving Credit Outstanding of any Lender exceeds the
Revolving Credit Commitment of such Lender then in effect, the Borrower shall,
without notice or demand, immediately prepay the Revolving Credit Loans in an
aggregate principal amount at least sufficient to eliminate any such excess.

 

(c)           If any (i) Preferred Stock (other than
Preferred Stock of the Borrower issued in connection with the formation or
acquisition of a joint venture so long as such Preferred Stock does not mature
or provide for redemption prior to the latest termination date of any Class of
Term Loans then outstanding and does not provide for the payment of any
dividends) or (ii) Indebtedness (excluding any Indebtedness permitted in
accordance with subsection 8.2 (other than the amount of any Refinancing
Indebtedness in respect of the Existing Notes or any Refinancing Indebtedness
in respect thereof in excess of the applicable Existing Note Payoff Amount) as
such subsection is in effect as of the Effective Date) shall be issued or
incurred by the Borrower or any of its Subsidiaries, an amount equal to 100% of
the Net Cash Proceeds thereof shall be applied on the date of such issuance or
incurrence to prepay the Term Loans in accordance with
subsection 4.8(a).  This subsection 4.4(c)
shall not affect any rights and remedies that the Administrative Agent or the
Lenders may otherwise have under Section 9.

 

(d)           If on any date the Borrower or any of its
Subsidiaries shall receive Net Cash Proceeds from any Asset Sale or Recovery
Event, then, unless a Reinvestment Notice shall be delivered in respect
thereof, 100% of such Net Cash Proceeds shall be applied on such date, to
prepay the Term Loans in accordance with subsection 4.8(a); provided
that, notwithstanding the foregoing, (i) the aggregate Net Cash Proceeds
of Asset Sales that may be excluded from the foregoing requirement pursuant to
a Reinvestment Notice shall not exceed $2,000,000 in any fiscal year of the
Borrower and (ii) on each Reinvestment Prepayment Date, an amount equal to
the Reinvestment Prepayment Amount with respect to the relevant Reinvestment
Event shall be applied to prepay the Term Loans in accordance with subsection
4.8(a).

 

(e)           If Capital Stock (other than Preferred Stock)
shall be issued by the Borrower, an amount equal to 50% of the Net Cash
Proceeds thereof shall be applied on the date of such issuance to prepay the
Term Loans in accordance with subsection 4.8(a), such 50% reducing to zero
if the ratio of Consolidated Indebtedness to Consolidated EBITDA as most
recently determined in accordance with subsection 7.2(b) (or 7.2(b) of the
Existing Credit Agreement, if

 

41

 

applicable) is less than 2.50 to 1.0.  This subsection 4.4(e) shall not affect any
rights and remedies that the Administrative Agent or the Lenders may otherwise
have under Section 9.

 

(f)            (i)  If
any amount is received by the Borrower or any of its Subsidiaries from Royal
Numico or its Affiliates in connection with the Rexall Purchase Agreement
(other than any amount representing a purchase price adjustment) or as a direct
or indirect result of any breach of any term or provision of the Rexall
Purchase Agreement or otherwise in respect of any claim by the Borrower or any
of its Subsidiaries arising out of the Rexall Acquisition (other than to the
extent relating to indemnification or reimbursements of amounts paid or to be
paid by the Borrower or any of its Subsidiaries to Persons other than the
Borrower or any of its Subsidiaries), an amount equal to 100% of the Net Cash
Proceeds thereof shall be applied on the date of such payment to prepay the
Term Loans in accordance with subsection 4.8(a).

 

(ii)           If any amount is received by the Borrower or
any of its Subsidiaries from Wyeth or its Affiliates in connection with the
Solgar Purchase Agreement (other than any amount representing a purchase price
adjustment) or as a direct or indirect result of any breach of any term or
provision of the Solgar Purchase Agreement or otherwise in respect of any claim
by the Borrower or any of its Subsidiaries arising out of the Solgar
Acquisition (other than to the extent relating to indemnification or
reimbursements of amounts paid or to be paid by the Borrower or any of its
Subsidiaries to Persons other than the Borrower or any of its Subsidiaries), an
amount equal to 100% of the Net Cash Proceeds thereof shall be applied on the
date of such payment to prepay the Term Loans in accordance with subsection
4.8(a).

 

(g)           Within 90 days after the end of each fiscal
year of the Borrower, 50% of the Borrower’s Excess Cash Flow shall be applied
to prepay the Term Loans in accordance with subsection 4.8(a), such 50%
reducing to zero if the ratio of Consolidated Indebtedness to Consolidated
EBITDA as most recently determined in accordance with subsection 7.2(b) is less
than 2.50 to 1.0.

 

(h)           Amounts prepaid on account of Term Loans may
not be reborrowed.

 

(i)            Each prepayment of Loans pursuant to this
subsection 4.4 shall be accompanied by accrued and unpaid interest on the
amount prepaid to the date of prepayment and any amounts payable under
subsection 4.11 or 4.15 in connection with such prepayment.

 

(j)            The Revolving Credit Loans shall be prepaid
and the Letters of Credit shall be cash collateralized or replaced to the
extent such Extensions of Credit at any time exceed the amount of the Revolving
Credit Commitments.

 

4.5.          Commitment Fees; Other Fees.

 

(a)           The Borrower agrees to pay to the
Administrative Agent for the account of each Lender (other than any Lender
which has defaulted in its obligation to fund a Loan under this Agreement), a
commitment fee for the period from and including the Closing Date to but

 

42

 

excluding
the Revolving Credit Termination Date (or such earlier date on which the
Revolving Credit Commitments shall terminate as provided herein) computed at
the rate per  annum set forth in the definition of “Applicable
Margin” under the heading “Commitment Fee” on the average daily Available
Revolving Credit Commitment of such Lender during the period for which payment
is made, payable quarterly in arrears on the last Business Day of each calendar
quarter and on the Revolving Credit Termination Date or such earlier date on
which the Revolving Credit Commitments shall terminate as provided herein,
commencing on the first such date to occur after the date hereof.

 

(b)           The Borrower shall pay (without duplication
of any other fee payable under this subsection 4.5) to each Agent any and all
fees separately agreed to by the Borrower and such Agents.

 

(c)           In lieu of any letter of credit commissions
and fees provided for in any Letter of Credit Application relating to a Standby
Letter of Credit (other than any standard issuance, amendment and negotiation
fees), the Borrower will pay the Administrative Agent, (i) for the account
of the Issuing Lender, a non-refundable fronting fee equal to 0.25 of 1% per
annum and (ii) for the account of the Issuing Lender (with respect
to its Participating Interest) and the Participating Lenders, a non-refundable
Standby Letter of Credit fee equal to the Applicable Margin in respect of
Eurodollar Revolving Credit Loans, in each case on the amount available to be
drawn under such Standby Letter of Credit. 
Such fees shall be payable quarterly in arrears on the last Business Day
of each calendar quarter, and shall be calculated on the average daily amount
available to be drawn under the Standby Letters of Credit.

 

(d)           In lieu of any letter of credit commissions
and fees provided for in any Letter of Credit Application relating to a
Commercial Letter of Credit (other than any standard issuance, amendment and
negotiation fees), the Borrower will pay the Administrative Agent, (i) for
the account of the Issuing Lender, a non-refundable fronting fee equal to 1/16
of 1% of the amount of such Commercial Letter of Credit, (ii) for the
account of the Issuing Lender (with respect to its Participating Interest) and
the Participating Lenders, a non-refundable Commercial Letter of Credit fee
equal to 1/4 of 1% of the amount of such Letter of Credit.  Such fees shall be payable to the
Administrative Agent on the date of issuance and shall be distributed by the
Administrative Agent to the Issuing Lender or the Participating Lenders, as
applicable, promptly thereafter and (iii) for the account of the
Administrative Agent, the normal and customary Letter of Credit application and
processing fees.

 

(e)           The Borrower agrees to pay the Issuing Lender
for its own account the customary administration, amendment, transfer and
negotiation fees charged by the Issuing Lender in connection with its issuance
and administration of Letters of Credit.

 

4.6.          Computation of Interest and Fees.

 

(a)           Interest and fees shall be calculated on the
basis of a 360-day year for the actual days elapsed (including the first day
but excluding the last day); provided that interest

 

43

 

calculated at the Alternate Base Rate (based
on the Prime Rate included therein) shall be calculated on the basis of a 365-
(or 366-, as the case may be) day year for the actual days elapsed (including
the first day but excluding the last day). 
The Administrative Agent shall as soon as practicable notify the
Borrower and the relevant Lenders of each determination of a Eurodollar Rate.  Any change in the interest rate on a Loan
resulting from a change in the Alternate Base Rate shall become effective as of
the opening of business on the day on which such change becomes effective.  The Administrative Agent shall as soon as
practicable notify the Borrower and the relevant Lenders of the effective date
and the amount of each such change in the Alternate Base Rate.

 

(b)           Each determination of an interest rate by the
Administrative Agent pursuant to any provision of this Agreement shall be
conclusive and binding on the Borrower and the Lenders in the absence of
manifest error.  The Administrative Agent
shall, at the request of the Borrower, deliver to the Borrower a statement
showing in reasonable detail the calculations used by the Administrative Agent
in determining any interest rate pursuant to subsection 4.1.

 

4.7.          Inability
to Determine Interest Rate.  If prior to the first day of any Interest
Period:

 

(a)           the Administrative Agent shall have
determined (which determination shall be conclusive and binding upon the
Borrower) that, by reason of circumstances affecting the relevant market,
adequate and reasonable means do not exist for ascertaining the Eurodollar Rate
for such Interest Period, or

 

(b)           the Administrative Agent has received
notice from the Majority Lenders that the Eurodollar Rate determined or to be
determined for such Interest Period will not adequately and fairly reflect the
cost to such Lenders of making or maintaining their Eurodollar Loans during
such Interest Period,

 

the
Administrative Agent shall give telecopy or telephonic notice thereof to the
Borrower and the Lenders as soon as practicable thereafter.  If such notice is given (i) any
Eurodollar Loans requested to be made on the first day of such Interest Period
shall be made as ABR Loans in U.S. Dollars, (ii) any Revolving Credit
Loans or Term Loans that were to have been converted on the first day of such
Interest Period to or continued as Eurodollar Loans shall be converted to or
continued as ABR Loans and (iii) any outstanding Eurodollar Loans shall be
converted on the last day of such Interest Period to ABR Loans.  Until such notice has been withdrawn by the
Administrative Agent, no further Eurodollar Loans shall be made or continued as
such, nor shall the Borrower have the right to convert ABR Loans to Eurodollar
Loans.

 

4.8.          Pro Rata Treatment and Payments.

 

(a)           (i) 
Each borrowing of Revolving Credit Loans by the Borrower from the
Lenders hereunder shall be made pro  rata according to the
Revolving Credit Commitment Percentages of the Lenders in effect on the date of
such borrowing.

 

44

 

(ii)           Each payment by the Borrower on account
of any commitment fee or letter of credit fee hereunder shall be allocated by
the Administrative Agent among the Lenders in accordance with the respective
amounts which such Lenders are entitled to receive pursuant to subsection 4.5.

 

(iii)          Any reduction of the Revolving Credit
Commitments of the Lenders shall be allocated by the Administrative Agent among
the Lenders pro  rata according to the Revolving Credit Commitment
Percentages of the Lenders on the date of such reduction.

 

(iv)          In the event of any mandatory prepayment
of Term Loans made at a time when Term Loans of more than one Class remain
outstanding, the Borrower shall select Term Loans to be prepaid so that the
aggregate amount of such prepayment is allocated between the Term A Loans
and the Term C Loans pro  rata based on the aggregate
principal amount of outstanding Loans of each such Class; provided that
until all Term A Loans have been repaid in full, any Lender of Term C
Loans may elect, by notice to the Administrative Agent by telephone (confirmed
by telecopy) at least one Business Day prior to the prepayment date, to decline
(but only to the extent the such declined Term C Loan prepayment would not
reduce the outstanding principal of such Lender’s Term A Loan below zero)
all or any portion of any prepayment of its Term C Loans pursuant to this
subsection 4.8(a), in which case the aggregate amount of the prepayment
that would have been applied to prepay Term C Loans but was so declined
shall be applied to prepay Term A Loans. Each payment by the Borrower on
account of principal of or interest in respect of Revolving Credit Loans or
Term Loans shall be allocated by the Administrative Agent within the Applicable
Class pro  rata according to the respective amounts thereof then
due and owing to each Lender. 
Prepayments of Term Loans pursuant to subsection 4.4(a), 4.4(c),
4.4(d), 4.4(e), 4.4(f) or 4.4(g) shall be applied (x) pro  rata
according to the respective principal amounts thereof then due and owing to
each Lender within the applicable Class and (y) pro rata to the respective
installments of principal thereof.

 

(v)           All payments (including prepayments) to
be made by the Borrower in respect of Revolving Credit Loans or Term Loans
hereunder, whether on account of principal, interest, fees or otherwise, shall
be made without set-off or counterclaim and shall be made prior to 12:00 Noon,
New York City time, on the due date thereof to the Administrative Agent,
for the account of the Lenders entitled thereto, at the Administrative Agent’s
office specified in subsection 11.2, in U.S. Dollars and in immediately
available funds.  The Administrative
Agent shall distribute such payments to the Lenders entitled to receive the
same promptly upon receipt in like funds as received.

 

(vi)          If any payment hereunder (other than
payments on the Eurodollar Loans) becomes due and payable on a day other than a
Business Day, the maturity of such payment shall be extended to the next
succeeding Business Day, and, with respect to payments of principal, interest
thereon shall be payable at the then applicable rate during such
extension.  If any payment on a Eurodollar
Loan becomes due and payable on a day other than a Business Day, the maturity
of such payment shall be extended to the next succeeding Business Day (and,
with respect to

 

45

 

payments
of principal, interest thereon shall be payable at the then applicable rate
during such extension) unless the result of such extension would be to extend
such payment into another calendar month, in which event such payment shall be
made on the immediately preceding Business Day.

 

(b)           Unless the Administrative Agent shall have
been notified in writing by any Lender prior to a Borrowing Date that such
Lender will not make the amount that would constitute its share of such
borrowing available to the Administrative Agent, the Administrative Agent may
assume that such Lender is making such amount available to the Administrative
Agent, and the Administrative Agent may, in reliance upon such assumption, make
available to the Borrower a corresponding amount.  If such amount is not made available to the
Administrative Agent by the required time on the Borrowing Date therefor, such
Lender shall pay to the Administrative Agent, on demand, such amount with
interest thereon at a rate per  annum equal to the daily average
Federal Funds Effective Rate for the period until such Lender makes such amount
immediately available to the Administrative Agent.  A certificate of the Administrative Agent
submitted to any Lender with respect to any amounts owing under this subsection
shall be conclusive in the absence of manifest error.  If such Lender’s share of such borrowing is
not made available to the Administrative Agent by such Lender within three
Business Days of such Borrowing Date, the Borrower shall repay such Lender’s
share of such borrowing (together with interest thereon from the date such
amount was made available to the Borrower at the rate per  annum
applicable to ABR Loans hereunder to the Administrative Agent not later than
three Business Days after receipt of written notice from the Administrative
Agent specifying such Lender’s share of such borrowing that was not made
available to such Administrative Agent, and the Borrower shall have the right
to pursue any remedies against such Lender for its failure to make its portion
of such borrowing available.

 

(c)           Unless the Administrative Agent shall have
been notified in writing by the Borrower prior to a date on which a payment is
due from the Borrower hereunder that the Borrower will not make such payment
available to the Administrative Agent, the Administrative Agent may assume that
the Borrower is making such amount available to the Administrative Agent, and
the Administrative Agent may, in reliance upon such assumption, make available
to the applicable Lenders a corresponding amount.  If such amount is not made available to the
Administrative Agent by the required time on the due date therefor, each
applicable Lender shall pay to the Administrative Agent, on demand, such amount
with interest thereon at a rate per  annum equal to the daily
average Federal Funds Effective Rate for the period until such Lender makes
such amount immediately available to the Administrative Agent.  A certificate of the Administrative Agent
submitted to any Lender with respect to any amounts owing under this subsection
shall be conclusive in the absence of manifest error.

 

4.9.          Illegality. 
Notwithstanding any other provision herein, if the adoption of or any
change in any Legal Requirement or in the interpretation or application thereof
shall make it unlawful for any Lender to make or maintain Eurodollar Loans as
contemplated by this Agreement, (a) the commitment of such Lender hereunder to
make Eurodollar Loans, continue

 

46

 

Eurodollar Loans as such and convert ABR
Loans to Eurodollar Loans shall forthwith be cancelled until such time as it
shall no longer be unlawful for such Lender to make or maintain the affected
Loans and (b) such Lender’s Loans then outstanding as Eurodollar Loans, if
any, shall be converted automatically to ABR Loans on the respective last days
of the then current Interest Periods with respect to such Eurodollar Loans or
within such earlier period as may be required by law.  If any such conversion of a Eurodollar Loan
occurs on a day which is not the last day of the then current Interest Period
with respect thereto, the Borrower shall pay to such Lender such amounts, if
any, as may be required pursuant to subsection 4.11.

 

4.10.        Increased Costs.

 

(a)           In the event that the adoption of or any
change in any Legal Requirement (or in the interpretation or application
thereof) or compliance by any Lender with any request or directive (whether or
not having the force of law) from any central bank or other Governmental
Authority:

 

(i)            does or shall subject any Lender to any tax
of any kind whatsoever with respect to this Agreement, any Note, any Loans made
by it or any Letter of Credit, or change the basis of taxation of payments to
such Lender of principal, fees, interest or any other amount payable hereunder
(except for (i) changes in the rate of tax on the overall net income or
profits of such Lender, (ii) any tax to the extent that the Borrower is or
would be required to pay an additional amount with respect to such tax under
subsection 4.12 or (iii) any tax with respect to which the Borrower
would not be required to pay an additional amount under subsection 4.12
because payment of such additional amount with respect to such tax would be
specifically excluded thereunder);

 

(ii)           does or shall impose, modify or hold
applicable any reserve, special deposit, compulsory loan or similar requirement
against assets held by, or deposits or other liabilities in or for the account
of, advances or loans by, or other credit extended by, or any other acquisition
of funds by, any office of such Lender which are not otherwise included in the
determination of the Eurodollar Rate; or

 

(iii)          does or shall impose on such Lender any other
condition affecting this Agreement or the Loans made by any Lender or any
Letter of Credit participation therein;

 

and
the result of any of the foregoing is to increase the cost to such Lender, by
any amount which such Lender deems to be material, of making, renewing,
maintaining or participating in advances or extensions of credit or to reduce
any amount receivable hereunder, in each case in respect of its Loans or
Letters of Credit which it issues or in which it holds Participating Interests,
then, in any such case, the Borrower shall promptly pay such Lender, upon
receipt of its demand setting forth in reasonable detail, any additional amounts
necessary to compensate such Lender for such additional cost or reduced amount
receivable, together with interest on each such amount from the date two
Business Days after the date demanded until payment in full thereof at the
Alternate Base Rate.  A certificate as to
any additional amounts payable pursuant to the foregoing sentence

 

47

 

submitted
by such Lender, through the Administrative Agent, to the Borrower shall be
conclusive in the absence of manifest error. 
This covenant shall survive the termination of this Agreement and
payment of all amounts outstanding hereunder for a period of one year.

 

(b)           In the event that any Lender shall have
determined that the adoption of any law, rule, regulation or guideline
regarding capital adequacy (or any change therein or in the interpretation or
application thereof) or compliance by any Lender or any corporation controlling
such Lender with any request or directive regarding capital adequacy (whether
or not having the force of law) from any central bank or Governmental
Authority, including, without limitation, the issuance of any final rule,
regulation or guideline, does or shall have the effect of reducing the rate of
return on such Lender’s or such corporation’s capital as a consequence of its
obligations hereunder to a level below that which such Lender or such
corporation could have achieved but for such adoption, change or compliance
(taking into consideration such Lender’s or such corporation’s policies with
respect to capital adequacy) by an amount deemed by such Lender to be material,
then from time to time, after submission by such Lender to the Borrower (with a
copy to the Administrative Agent) of a written request therefor, the Borrower
shall promptly pay to such Lender such additional amount or amounts as will
compensate such Lender or such corporation for such reduction.  A certificate as to any additional amounts
payable pursuant to this subsection 4.10(b), submitted by a Lender to the
Borrower, shall be conclusive in the absence of manifest error.  The provisions of this subsection 4.10(b)
shall survive the termination of this Agreement and the payment of all amounts
outstanding hereunder.

 

(c)           Any request by any Lender for compensation
under this subsection 4.10 shall be accompanied by a certificate of a duly
authorized officer of such Lender setting for such information and calculations
supporting such request as such Lender shall customarily provide in similar
situations.

 

(d)           Failure or delay on the part of any Lender to
demand compensation pursuant to this subsection 4.10 shall not constitute a
waiver of such Lender’s right to demand such compensation; provided that
the Borrower shall not be required to compensate a Lender pursuant to this
subsection 4.10 for any increased costs or reductions incurred more than 180
days prior to the date that such Lender notifies the Borrower of the
circumstance giving rise to such increased costs or reductions and of such
Lender’s intention to claim compensation therefor; provided, further,
that, if the circumstance giving rise to such increased costs or reductions is
retroactive in effect, then the 180-day period referred to above shall be
extended to include the period of retroactive effect thereof.

 

4.11.        Indemnity. 
Without duplication of the provisions of subsection 4.15, the
Borrower agrees to indemnify each Lender and to hold each Lender harmless from
any loss or expense which such Lender may sustain or incur as a consequence of
(a) default by the Borrower in payment when due of the principal amount of or
interest on any Loans of such Lender, (b) default by the Borrower in making a
borrowing, continuation or conversion after the Borrower has given a notice of
borrowing, a notice of continuation or a notice of conversion in accordance

 

48

 

with this Agreement, (c) default by the
Borrower in making any prepayment after the Borrower has given a notice in
accordance with this Agreement or (d) the making of a prepayment, continuation
or conversion of a Eurodollar Loan on a day which is not the last day of an
Interest Period with respect thereto, including, without limitation, in each
case, any such loss or expense arising from the reemployment of funds obtained
by it to maintain its Eurodollar Loans hereunder or from fees payable to
terminate the deposits from which such funds were obtained, but excluding, in
each case, lost profit.  A certificate as
to any amounts payable pursuant to this subsection 4.11, submitted by a Lender
to the Borrower, shall be conclusive in the absence of manifest error.  This covenant shall survive termination of
this Agreement and payment of all amounts outstanding hereunder.

 

4.12.        Taxes.

 

(a)           Any and all payments by or on account of any
obligation of the Borrower hereunder shall be made free and clear of and
without deduction for any Indemnified Taxes or Other Taxes; provided
that if the Borrower shall be required to deduct any Indemnified Taxes or Other
Taxes from such payments, then (i) the sum payable shall be increased as
necessary so that after making all required deductions (including deductions
applicable to additional sums payable under this subsection) the Administrative
Agent, Lender or Issuing Lender (as the case may be) receives an amount equal
to the sum it would have received had no such deductions been made,
(ii) the Borrower shall make such deductions and (iii) the Borrower
shall pay the full amount deducted to the relevant Governmental Authority in
accordance with applicable law.

 

(b)           In addition, the Borrower shall pay any Other
Taxes to the relevant Governmental Authority in accordance with applicable law.

 

(c)           The Borrower shall indemnify the
Administrative Agent, each Lender and the Issuing Lender, within 10 days after
written demand therefor, for the full amount of any Indemnified Taxes or Other
Taxes paid by the Administrative Agent, such Lender or the Issuing Lender, as
the case may be, on or with respect to any payment by or on account of any
obligation of the Borrower hereunder (including Indemnified Taxes or Other
Taxes imposed or asserted on or attributable to amounts payable under this
subsection) and any penalties, interest and reasonable expenses arising
therefrom or with respect thereto, whether or not such Indemnified Taxes or
Other Taxes were correctly or legally imposed or asserted by the relevant
Governmental Authority.  A certificate as
to the amount of such payment or liability delivered to the Borrower by a
Lender or the Issuing Lender, or by the Administrative Agent on its own behalf
or on behalf of a Lender or the Issuing Lender, shall be conclusive absent
manifest error.

 

(d)           As soon as practicable after any payment of
Indemnified Taxes or Other Taxes by the Borrower to a Governmental Authority,
the Borrower shall deliver to the Administrative Agent the original or a
certified copy of a receipt issued by such Governmental Authority evidencing
such payment, a copy of the return reporting such payment or other evidence of
such payment reasonably satisfactory to the Administrative Agent.

 

49

 

(e)           Any Foreign Lender that is entitled to an
exemption from or reduction of withholding tax under the law of the
jurisdiction in which the Borrower is located, or any treaty to which such
jurisdiction is a party, with respect to payments under this Agreement shall
deliver to the Borrower (with a copy to the Administrative Agent), at the time
or times prescribed by applicable law, such properly completed and executed
documentation prescribed by applicable law or reasonably requested by the
Borrower as will permit such payments to be made without withholding or at a
reduced rate.  Without limiting the
foregoing, at the request of the Borrower each Foreign Lender, on or prior to
the date on which such Foreign Lender becomes a Lender hereunder (and from time
to time thereafter upon the request of the Borrower or the Administrative
Agent), shall deliver to the Borrower and the Administrative Agent either
(i) two duly completed copies of either (x) Internal Revenue Service
Form W-8BEN claiming eligibility of the Foreign Lender for benefits of an
income tax treaty to which the United States is a party, or (y) Internal
Revenue Service Form W-8ECI, or in either case an applicable successor form;
(ii) in the case of a Foreign Lender that is not legally entitled to deliver
any form listed in clause (e)(i), (x) a certificate to the effect that
such Foreign Lender is not (A) a “bank” within the meaning of
Section 881(c)(3)(A) of the Code, (B) a “10 percent shareholder” of
the Borrower within the meaning of Section 881(c)(3)(B) of the Code, or
(C) a controlled foreign corporation receiving interest from a related
person within the meaning of Section 881(c)(3)(C) of the Code and (y) two
duly completed copies of Internal Revenue Service Form W-8BEN or applicable
successor form or (iii) any other form prescribed by law reasonably
satisfactory to the Borrower and the Administrative Agent entitling each Lender
to a complete exemption from or reduction in withholding tax.

 

(f)            If the Administrative Agent or a Lender
determines, in its reasonable discretion, that it has received a refund of any
Taxes or Other Taxes as to which it has been indemnified by the Borrower or
with respect to which the Borrower has paid additional amounts pursuant to this
subsection 4.12, it shall pay over such refund to the Borrower as determined in
good faith by the Administrative Agent or such Lender in its sole discretion
(but only to the extent of indemnity payments made, or additional amounts paid,
by the Borrower under this subsection 4.12 with respect to the Taxes or Other
Taxes giving rise to such refund), net of all out-of-pocket expenses of the
Administrative Agent or such Lender and without interest (other than any interest
paid by the relevant Governmental Authority with respect to such refund); provided
that the Borrower, upon the request of the Administrative Agent or such Lender,
agrees to repay the amount paid over to the Borrower (plus any penalties,
interest or other charges imposed by the relevant Governmental Authority) to
the Administrative Agent or such Lender in the event the Administrative Agent
or such Lender is required to repay such refund to such Governmental Authority.
This subsection 4.12 shall not be construed to require the Administrative Agent
or any Lender to make available its tax returns (or any other information
relating to its taxes which it deems confidential) to the Borrower or any other
Person.

 

4.13.        Use
of Proceeds.  The proceeds of the Revolving Credit Loans
shall be used for the general working capital and general corporate purposes of
the Borrower and its Subsidiaries.  The
Letters of Credit shall be used for the purposes specified in subsection 3.8.  The

 

50

 

proceeds of the Prior Term A Loans and
Term B Loans (as defined in the Existing Credit Agreement) were used to
finance the Rexall Transactions.  The
proceeds of the Term C Loans were used to repay the Term B Loans (as
defined in the Existing Credit Agreement). 
The proceeds of the Term A Loans shall be used to finance the
Transactions.

 

4.14.        Change in Lending Office; Replacement of
Lender.

 

(a)           Each Lender agrees that if it makes any
demand for payment under subsection 4.10 or 4.12, or if any adoption or
change of the type described in subsection 4.9 shall occur with respect to
it, it will use reasonable efforts (consistent with its internal policy and
legal and regulatory restrictions and so long as such efforts would not be
disadvantageous to it, as determined in its sole discretion) to designate a
different lending office or to assign its rights and obligations hereunder to
another of its offices, branches or affiliates if such designation or
assignment would reduce or obviate the need for the Borrower to make payments
under subsection 4.10 or 4.12, or would eliminate or reduce the effect of
any adoption or change described in subsection 4.9.

 

(b)           If any Lender requests any payment under
subsection 4.10 or 4.12, the Borrower shall have the right to replace such
Lender with one or more replacement lenders, each of which shall be reasonably
acceptable to the Administrative Agent; provided that (i) the
Borrower shall repay (or the replacement lender shall purchase) all Loans and
other amounts owing hereunder to such replaced Lender prior to the date of
replacement, (ii) until such time as such replacement shall be
consummated, the Borrower shall pay additional amounts (if any) required
pursuant to subsection 4.10 or 4.12 for the period prior to replacement and
(iii) any such replacement shall not be deemed to be a waiver of any
rights which the Borrower, the Administrative Agent or any other Lender shall
have against the replaced Lender.

 

4.15.        Break
Funding Payments.  In the event of (a) the payment of any
principal of any Eurodollar Loan other than on the last day of an Interest
Period applicable thereto (including, without limitation, as a result of an
Event of Default), (b) the conversion of any Eurodollar other than on the
last day of an Interest Period applicable thereto, or (c) the failure to
borrow, convert, continue or prepay any Eurodollar Loan on the date specified
in any notice delivered pursuant hereto, then, in any such event, the Borrower
shall compensate each Lender for the loss, cost and expense attributable to
such event.  Such loss, cost or expense
to any Lender shall be the amount determined by such Lender to be the excess,
if any, of (i) the amount of interest that would have accrued on the
principal amount of such Loan had such event not occurred, at the Eurodollar
Rate that would have been applicable to such Loan (excluding, for the avoidance
of doubt, any Applicable Margin), for the period from the date of such event to
the last day of the then current Interest Period therefor (or, in the case of a
failure to borrow, convert or continue, for the period that would have been the
Interest Period for such Loan) over (ii) the amount of interest that would
accrue on such principal amount for such period at the interest rate such Lender
would bid were it to bid, at the commencement of such period, for dollar
deposits of a comparable amount and period from other banks in the eurodollar
market.  A certificate of any Lender

 

51

 

setting forth any amount or amounts that such
Lender is entitled to receive pursuant to this subsection 4.15 shall be
delivered to the Borrower and shall be conclusive absent manifest error.  The Borrower shall pay such lender the amount
shown as due on any such certificate within 10 days after receipt thereof.

 

SECTION 5.  REPRESENTATIONS AND WARRANTIES

 

To
induce the Lenders to enter into this Agreement and to make the Loans, and to
induce the Issuing Lender to issue Letters of Credit, the Borrower hereby
represents and warrants to each Agent and to each Lender that:

 

5.1.          Financial Condition; Accuracy of Public
Information.

 

(a)           Copies of the consolidated balance sheets of
Target as at December 31, 2004, December 31, 2003 and December 31, 2002 and the
related consolidated statements of income and cash flows for each of the fiscal
years ended on such date, reported on by independent auditors for Wyeth, have
heretofore been furnished to each Lender. 
Copies of the unaudited consolidated balance sheets of Target as at March
31, 2005, March 31, 2004, April 30, 2005 and April 30, 2004 and the related
unaudited consolidated statements of income and cash flows for the fiscal
quarter (in the case of statements dated as of March 31) or month (in the case
of statements dated April 30) ended on such dates, have heretofore been
furnished to each Lender. During the period from September 30, 2002 to and
including the date hereof, there has been no sale, transfer or other
disposition by the Borrower or any of its consolidated Subsidiaries of any
material part of its business or property and no purchase or other acquisition
of any business or property (including any capital stock of any other Person)
material in relation to the consolidated financial condition of the Borrower
and its consolidated Subsidiaries at September 30, 2002, other than (i)
the sale of inventory in the ordinary course of business, (ii) the Rexall
Acquisition and the Solgar Acquisition, (iii) any such activity prior to the
Closing Date by Subsidiaries acquired in the Rexall Acquisition or prior to the
Effective Date by Subsidiaries acquired in the Solgar Acquisition and (iv) as
otherwise permitted hereunder.

 

(b)           The consolidated
balance sheet of the Borrower and its consolidated Subsidiaries as at September
30, 2005 prepared on a pro forma basis
giving effect to the Transactions, (the “Pro Forma Balance Sheet”),
copies of which have heretofore been furnished to each Lender, have been
prepared in good faith based upon assumptions believed by the Borrower to be
reasonable.

 

(c)           The financial projections of the Borrower and
its Subsidiaries described in subsection 6.3(k), copies of which have been
furnished to each Lender, have been prepared in good faith based upon
assumptions believed by the Borrower to be reasonable.

 

5.2.          No
Change.  Since September 30, 2002, there has been no
development or event which has had or would reasonably be expected to have a
Material Adverse Effect, except

 

52

 

as disclosed in filings with the U.S.
Securities and Exchange Commission pursuant to the Exchange Act made on or
prior to June 13, 2005.

 

5.3.          Corporate
Existence; Compliance with Law.  Each Loan Party and its Subsidiaries (a) is
duly organized, validly existing and in good standing under the laws of the
jurisdiction of its organization, (b) has the power and authority, and the
legal right, to own and operate its property, to lease the property it operates
as lessee and to conduct the business in which it is currently engaged, (c) is duly
qualified as a foreign entity and in good standing under the laws of each
jurisdiction where its ownership, lease or operation of property or the conduct
of its business requires such qualification except to the extent that the
failure to be so qualified in any such jurisdiction could not, in the
aggregate, reasonably be expected to have a Material Adverse Effect, and (d) is
in compliance with all Requirements of Law except to the extent that the
failure to comply therewith would not, in the aggregate, reasonably be expected
to have a Material Adverse Effect.

 

5.4.          Corporate
Power; Authorization; Enforceable Obligations.  Each Loan Party has the power
and authority, and the legal right, to make, deliver and perform the Loan
Documents to which it is a party and to borrow and obtain other extensions of
credit hereunder and has taken all necessary action to authorize the borrowings
and other extensions of credit hereunder on the terms and conditions of this
Agreement and any Notes and to authorize the execution, delivery and
performance of the Loan Documents to which it is a party.  The Borrower has the power and authority, and
the legal right, to make, deliver and perform the Solgar Purchase Agreement and
to complete the Solgar Acquisition and the other Transactions.  Except as set forth on Schedule 5.4,
no consent or authorization of, filing with, notice to or other act by or in
respect of, any Governmental Authority or any other Person is required as a
condition precedent to the Borrower’s obligation to consummate the Solgar
Acquisition or in connection with the borrowings or other extensions of credit
hereunder or the execution, delivery, performance, validity or enforceability
of the Loan Documents.  This Agreement has
been, and each other Loan Document to which it is a party will be, duly
executed and delivered on behalf of each Loan Party that is a party hereto or
thereto.  The Solgar Purchase Agreement
has been duly executed and delivered on behalf of the Borrower.  This Agreement constitutes, and each other
Loan Document to which it is a party (except the Existing Credit Agreement)
continues to constitute, a legal, valid and binding obligation of each Loan
Party that is a party hereto or thereto, enforceable against such Loan Party in
accordance with its terms, subject to the effects of bankruptcy, insolvency,
fraudulent conveyance, reorganization, moratorium and other similar laws
relating to or affecting creditors’ rights generally, general equitable
principles (whether considered in a proceeding in equity or at law) and an
implied covenant of good faith and fair dealing.  The Solgar Purchase Agreement constitutes a
legal, valid and binding obligation of the Borrower, enforceable against the
Borrower in accordance with its terms, subject to the effects of bankruptcy,
insolvency, fraudulent conveyance, reorganization, moratorium and other similar
laws relating to or affecting creditors’ rights generally, general equitable
principles (whether considered in a proceeding in equity or at law) and an
implied covenant of good faith and fair dealing.

 

53

 

5.5.          No Legal Bar.  The
execution, delivery and performance by the Borrower of the Solgar Purchase
Agreement, the Loan Documents, the borrowings and other extensions of credit
hereunder and the use of the proceeds thereof and the consummation of the
Solgar Acquisition and the other Transactions will not (a) violate any
Requirement of Law or Contractual Obligation of any Loan Party or of any of its
Subsidiaries except (other than with respect to Security Documents or the
organizational and governing documents of such Loan Party or Subsidiaries), as
would not, in the aggregate, reasonably be expected to result in a Material
Adverse Effect, or (b) result in, or require, the creation or imposition of any
Lien on any of its or their respective properties or revenues pursuant to any
such Requirement of Law or Contractual Obligation (other than those Liens
created by the Loan Documents).

 

5.6.          No
Material Litigation.  Except as disclosed in filings with the
Securities and Exchange Commission under the headings “Litigation or “Legal
Proceedings” or similar headings or as set forth on Schedule 5.6, no
litigation, investigation or proceeding of or before any arbitrator or Governmental
Authority is pending or, to the knowledge of the Loan Parties, threatened by or
against any Loan Party or any of its Subsidiaries or against any of its or
their respective properties or revenues (a) with respect to any of the Loan
Documents or the Solgar Acquisition and the other transactions contemplated
hereby or thereby, or (b) which would reasonably be expected to have a Material
Adverse Effect.

 

5.7.          No
Default.  No Loan Party or any of its Subsidiaries is
in default under or with respect to any of its Contractual Obligations in any
respect which could reasonably be expected to have a Material Adverse
Effect.  No Default or Event of Default
(under and as defined in the indenture governing the Existing Notes) has
occurred and is continuing.  No Default
or Event of Default has occurred and is continuing.

 

5.8.          Ownership
of Property; Liens.  Each of the Loan Parties and its Subsidiaries
has good record and marketable title in fee simple to, or a valid leasehold
interest in, all its real property, and good title to, or a valid leasehold
interest in, all its other property, except to the extent that the failure to
have such title would not have a Material Adverse Effect.  None of such property is subject to any Lien
except as permitted by subsection 8.3.  With respect to real property or interests in
real property, as of the Effective Date, the Borrower or its Subsidiaries have
(i) fee title to all of the real property listed on Schedule 5.8
under the heading “Fee Properties” (each, a “Fee Property”), and (ii) good
and valid title to the leasehold estates in all of the real property leased by
it and listed on Schedule 5.8 under the heading “Leased Properties”
(each, a “Leased Property”), in each case free and clear of all
mortgages, liens, security interests, easements, covenants, rights-of-way and
other similar restrictions of any nature whatsoever, except (A) Liens
permitted pursuant to subsection 8.3, (B) as to Leased Property, the terms
and provisions of the respective lease therefor and any matters affecting the
fee title and any estate superior to the leasehold estate related thereto, and
(C) title or lease defects, or leases or subleases granted to others,
which are not material to the Fee Properties or the Leased Properties, as the
case may be, taken as a whole.  The Fee
Properties constitute, as of the Effective Date, substantially all of the real
property owned in fee by the Borrower and its Subsidiaries.

 

54

 

5.9.          Intellectual
Property.  Each Loan Party, and each of its
Subsidiaries, owns, or is licensed to use or otherwise has the right to use,
all trademarks, trade names, copyrights, patents, domain names, trade secrets
and other proprietary information that it uses in the conduct of its business
as currently conducted except for those for which the failure to own or license
which would not reasonably be expected to have a Material Adverse Effect (the “Intellectual
Property”).  To the knowledge of each
Loan Party, no claim has been asserted and is pending or is threatened to be
asserted by any Person challenging or questioning the use of any material
Intellectual Property or the validity or enforceability of any such
Intellectual Property, nor does any Loan Party know of any valid basis for any
such claim.  The use of such Intellectual
Property by each Loan Party and its Subsidiaries does not infringe on the
rights of any Person, except for such claims and infringements that, in the
aggregate, would not reasonably be expected to have a Material Adverse Effect.

 

5.10.        Taxes. 
Except as disclosed in Schedule 5.10, each Loan Party, and
each of its Subsidiaries, has filed or caused to be filed all material tax
returns which are required to be filed (and each such tax return is true and
correct in all material respects) and has paid all taxes shown to be due and
payable on said returns or on any assessments made against it or any of its
property and all other taxes, fees or other charges imposed on it or any of its
property by any Governmental Authority (other than any the amount or validity
of which are currently being contested in good faith by appropriate proceedings
and with respect to which reserves in conformity with GAAP have been provided
on the books of such Loan Party or its Subsidiaries, as the case may be), and
no tax Lien has been filed, and, to the knowledge of the Loan Parties, no claim
is being asserted, with respect to any such tax, fee or other charge, in each
case other than to the extent that any such failure to act or existence of
claim would not, in the aggregate, reasonably be expected to have a Material
Adverse Effect.

 

5.11.        Federal Regulations.  No
part of the proceeds of any Loans, and no Letter of Credit, will be used for
“purchasing” or “carrying” any “margin stock” within the respective meanings of
each of the quoted terms under Regulation U of the Board as now and from
time to time hereafter in effect.  If
requested by any Lender or the Administrative Agent, the Borrower will furnish
to the Administrative Agent and each Lender a statement to the foregoing effect
in conformity with the requirements of FR Form G-3 or FR Form U-1
referred to in said Regulation U, as the case may be.

 

5.12.        ERISA.

 

(i)            No ERISA Event has occurred or is
reasonably expected to occur that, when taken together with all other such
ERISA Events for which liability is reasonably expected to occur, would
reasonably be expected to result in a Material Adverse Effect.  The present value of all accumulated benefit
obligations under each Plan (based on the assumptions used for purposes of
Statement of Financial Accounting Standards No. 87) did not, as of the
date of the most recent financial statements reflecting such amounts, exceed
the fair market value of the assets of such Plan by more than $10,000,000, and
the present value of all accumulated benefit obligations

 

55

 

of all
underfunded Plans (based on the assumptions used for purposes of Statement of
Financial Accounting Standards No. 87) did not, as of the date of the most
recent financial statements reflecting such amounts, exceed the fair market
value of the assets of all such underfunded Plans by more than $10,000,000.

 

(ii)           Except as would not reasonably be expected to
result in a Material Adverse Effect, (i) each Foreign Plan has been maintained
in compliance with its terms and with the requirements of any and all
applicable laws, statutes, rules, regulations and orders and has been
maintained, where required, in good standing with applicable regulatory
authorities, and (ii) neither the Borrower nor any Subsidiary have incurred any
obligation in connection with the termination of or withdrawal from any Foreign
Plan.

 

5.13.        Investment
Company Act; Public Utility Holding Company Act; Other Regulations.  The
Borrower is not an “investment company,” or a company “controlled” by an
“investment company,” within the meaning of the Investment Company Act of 1940,
as amended, or (b) a “holding company” as defined in, or subject to regulation
under, the Public Utility Holding Company Act of 1935, as amended.  The Borrower is not subject to regulation
under any Federal or State statute or regulation (other than Regulation X
of the Board) which limits its ability to incur Indebtedness.

 

5.14.        Subsidiaries.  Schedule
II sets forth all Subsidiaries of the Borrower as of the Effective Date.

 

5.15.        Environmental
Matters.  Except to the extent that all of the
following, in the aggregate, could not reasonably be expected to result in a
Material Adverse Effect:

 

(a)           The facilities and properties owned,
leased or operated by each Loan Party or any of its Subsidiaries (the “Properties”)
do not contain any Hazardous Materials in amounts or concentrations which
(i) constitute a violation of, or (ii) could reasonably be expected
to give rise to liability under, any Environmental Law.

 

(b)           The Properties and all operations at the
Properties are in compliance in all material respects with all applicable
Environmental Laws, and there is no contamination at, under or about the
Properties or violation of any Environmental Law with respect to the Properties
or the business operated by any Loan Party or any of its Subsidiaries (the “Business”)
which could materially interfere with the continued operation of the
Properties.

 

(c)           Neither any Loan Party nor any of its
Subsidiaries has received any written notice of violation, alleged violation,
non-compliance, liability or potential liability regarding any Environmental
Laws with regard to any of the Properties or the Business, nor does any Loan
Party have knowledge that any such notice will be received or is being
threatened.

 

56

 

(d)           No Hazardous Materials have been
transported or disposed of from the Properties in violation of, or in a manner
or to a location which could reasonably be expected to give rise to liability
under, any Environmental Law, nor have any Hazardous Materials been generated,
treated, stored or disposed of at, on or under any of the Properties in
violation of, or in a manner that could reasonably be expected to give rise to
liability under, any applicable Environmental Law.

 

(e)           No judicial proceeding or governmental or
administrative action is pending or, to the knowledge of any Loan Party,
threatened, under any Environmental Law to which any Loan Party or any
Subsidiary thereof is or will be named as a party with respect to the
Properties or the Business, nor are there any decrees, orders or agreements
which impose obligations, or other administrative or judicial requirements
outstanding under any Environmental Law with respect to the Properties or the
Business.

 

(f)            There has been no release or threat of
release of Hazardous Materials at, under or from the Properties, or arising
from or related to the operations of any Loan Party or any Subsidiary thereof
in connection with the Properties or otherwise in connection with the Business,
in violation of or in amounts or in a manner that could reasonably be expected
to give rise to liability under Environmental Laws.

 

5.16.        Solvency.  Each
Loan Party is, and after giving effect to the consummation of any Acquisition
(including, without limitation, the Solgar Acquisition) and to the incurrence
of all Indebtedness and obligations being incurred in connection herewith and
therewith will be Solvent.

 

5.17.        Security
Documents.  The Guarantee and Collateral Agreement is
effective to create in favor of the Administrative Agent, for the benefit of
the Lenders, a legal, valid and enforceable security interest in the Collateral
described, and as defined, therein and proceeds thereof, and, after taking the
actions described in Schedule 3 thereto, the Liens created under
the Guarantee and Collateral Agreement shall at all times constitute fully
perfected Liens on, and security interests in, all right, title and interest of
the Loan Parties in such Collateral and the proceeds thereof, as security for
the Obligations (as defined in the Guarantee and Collateral Agreement) intended
to be secured thereby, in each case prior and superior in right to any other
Person, other than with respect to Liens expressly permitted by subsection 8.3.

 

5.18.        Insurance.  Schedule 5.18
sets forth a true, complete and correct summary description of all material
insurance maintained by each Loan Party. 
Such insurance is in full force and effect and all premiums have been
duly paid.  Each Loan Party has insurance
through insurers it reasonably believes to be of recognized financial
responsibility covering its properties, operations, personnel and businesses,
including business interruption insurance, which insurance is in amounts and
insures against such losses and risks as it reasonably believes are adequate to
protect it and its Subsidiaries and their respective businesses; and neither
the Borrower nor any of its Subsidiaries has received notice from any insurer
or agent of such insurer that capital

 

57

 

improvements or other expenditures are
required or necessary to be made in order to continue such insurance.

 

5.19.        Affiliate
Transactions.  All Contractual Obligations between the
Borrower and any of its Subsidiaries (other than those Subsidiaries acquired as
part of the Solgar Acquisition) on the one hand, and their respective
Affiliates, on the other hand, are disclosed in the Borrower’s most recent
proxy statement filed on Form 14A with the Securities and Exchange
Commission to the extent required under its regulations.  All material Contractual Obligations between
any Subsidiary of the Borrower acquired as part of the Solgar Acquisition, on
the one hand, and their respective Affiliates, on the other hand, are set forth
on Schedule 5.19.

 

5.20.        Accuracy
of Information.  No statement or
information contained in this Agreement, any other Loan Document or any other
document, certificate or statement furnished in writing to the Administrative
Agent or the Lenders or any of them (including, without limitation, filings
made by the Borrower under the Exchange Act and the regulations promulgated
thereunder), by or on behalf of any Loan Party for use in connection with the
transactions contemplated by this Agreement or the other Loan Documents, taken
as a whole together with all other information provided in this Agreement, the
other Loan Documents or any other such document, certificate or statement,
contained as of the date such statement, information, document or certificate
was so furnished any untrue statement of any fact material to the interests of
the Administrative Agent or any Lender, or omitted to state a fact necessary in
order to make the statements contained herein or therein, in the light of the
circumstances under which they were made, not misleading in any respect
material to the interests of the Administrative Agent or any Lender; provided
that, with respect to projected financial information, the Borrower represents
only that such information was prepared in good faith based upon assumptions
believed by the Borrower to be reasonable at the time.  There is no fact known to any Loan Party that
would reasonably be expected to have a Material Adverse Effect that has not
been expressly disclosed herein, in the other Loan Documents or in such other
documents, certificates and statements furnished to the Administrative Agent
and the Lenders for use in connection with the transactions contemplated hereby
and by the other Loan Documents.

 

5.21.        OFAC 
Neither any Loan Party, nor any Subsidiary of any Loan Party, nor any
Affiliate of any Loan Party, is (a) named on the list of Specially Designated
Nationals or Blocked Persons maintained by the U.S. Department of the
Treasury’s Office of Foreign Assets Control available at
http://www.treas.gov/offices/eotffe/ofac/sdn/index.html, or (b)(i) an agency of
the government of a country, (ii) an organization controlled by a country, or
(iii) a Person resident in a country that is subject to a sanctions program
identified on the list maintained by the U.S. Department of the Treasury’s
Office of Foreign Assets Control and available at
http://www.treas.gov/offices/eotffc/ofac/sanctions/index.html, or as otherwise
published from time to time, as such program maybe be applicable to such
agency, organization or Person, and the proceeds from the credit extensions
made pursuant to this Agreement will not be used to fund any operations in,
finance any investments or activities in, or make any payments to, any such
country or Person.

 

58

 

SECTION 6.  CONDITIONS PRECEDENT

 

6.1.          Conditions
to Closing Date.  The conditions precedent to the obligation of
each Existing Lender to fund the initial extension of credit requested to be
made by it on the Closing Date were met on the Closing Date.

 

6.2.          Conditions
to Each Extension of Credit.  The agreement of each Lender to make any
Extension of Credit requested to be made by it on any date (including, without
limitation, the Closing Date and the Effective Date), is subject to the
satisfaction of the following conditions precedent as of the date such
Extension of Credit is requested to be made:

 

(a)           Representations and Warranties. 
Each of the representations and warranties made by each of the Loan
Parties in or pursuant to the Loan Documents shall be true and correct in all
material respects on and as of such date as if made on and as of such date,
other than any such representations and warranties that, by their terms, refer
to a specific date other than such date, in which case as of such specific date.

 

(b)           No Default.  No Default or
Event of Default shall have occurred and be continuing on such date or after
giving effect to the Extension of Credit requested to be made on such date.

 

Each
request by the Borrower for an Extension of Credit to be made to the Borrower
hereunder shall constitute a representation and warranty by the Borrower as of
the date of such Extension of Credit that the conditions contained in this
subsection 6.2 have been satisfied.

 

6.3.          Conditions
to Effective Date.  The Effective Date shall occur on the date of
satisfaction of the following conditions precedent:

 

(a)           Loan Documents. 
The Administrative Agent shall have received (i) this Agreement,
executed and delivered by a duly authorized officer of the Borrower, and
(ii) signed Term A Notes for the account of each Lender that shall so
request, executed and delivered by a duly authorized officer of the Borrower.

 

(b)           Closing Certificate. 
The Administrative Agent shall have received, with a copy for each
Lender, a certificate of the Borrower and the other Loan Parties, dated the
Effective Date, substantially in the form attached hereto as Exhibit F,
with appropriate insertions and attachments satisfactory in form and substance
to the Administrative Agent, executed by the President or any Vice President
and the Secretary or any Assistant Secretary of the Borrower or the relevant
Loan Party.

 

(c)           Corporate Proceedings of the Borrower. 
The Administrative Agent shall have received, with a counterpart for
each Lender, a copy of the resolutions, in form and substance satisfactory to
the Administrative Agent, of the Board of Directors of the Borrower authorizing
(i) the execution, delivery and performance of this Agreement,
(ii) the

 

59

 

borrowings contemplated
hereunder, and (iii) the Transactions, certified by the Secretary or an
Assistant Secretary of the Borrower as of the Effective Date, which certificate
shall be in form and substance satisfactory to the Administrative Agent and shall
state that the resolutions thereby certified have not been amended, modified,
revoked or rescinded.

 

(d)           Borrower Incumbency Certificate. 
The Administrative Agent shall have received, with a counterpart for
each Lender, a certificate of the Borrower, dated the Effective Date, as to the
incumbency and signature of the officers of the Borrower executing any Loan
Document satisfactory in form and substance to the Administrative Agent,
executed by the President or any Vice President and the Secretary or any
Assistant Secretary of the Borrower.

 

(e)           Corporate Proceedings of Subsidiaries. 
The Administrative Agent shall have received, with a counterpart for
each Lender, a copy of the resolutions, in form and substance satisfactory to
the Administrative Agent, of the Board of Directors of each Subsidiary of the
Borrower which is a party to a Loan Document authorizing the execution,
delivery and performance of the Loan Documents to which it is a party,
certified by the Secretary or an Assistant Secretary of each such Subsidiary as
of the Effective Date, which certificate shall be in form and substance
satisfactory to the Administrative Agent and shall state that the resolutions
thereby certified have not been amended, modified, revoked or rescinded.

 

(f)            Subsidiary Incumbency Certificates. 
The Administrative Agent shall have received, with a counterpart for
each Lender, a certificate of each Domestic Subsidiary of the Borrower which is
a party to a Loan Document, dated the Effective Date, as to the incumbency and
signature of the officers of such Subsidiary, satisfactory in form and
substance to the Administrative Agent, executed by the President or any Vice
President and the Secretary or any Assistant Secretary of each such Subsidiary.

 

(g)           Corporate Documents.  The
Administrative Agent shall have received, with a counterpart for each Lender,
true and complete copies of the certificate of incorporation and by-laws of
each Loan Party, certified as of the Effective Date as complete and correct
copies thereof by the Secretary or an Assistant Secretary of such Loan Party.

 

(h)           Fees.  The Arranger,
each Agent and the Lenders shall have received all invoiced fees, costs,
expenses and compensation required to be paid on the Effective Date (including
reasonable fees, disbursements and other charges of legal counsel to the
Arranger and the Lenders and expenses of appraisers, consultants and other
advisors to the Arranger and the Lenders and who have been approved by the
Borrower).  The Borrower shall have paid
to each Existing Lender that executes and delivers a signature page to this
Agreement not later than the close of business (New York City time) on August
1, 2005 a fee in an aggregate amount equal to 0.05% of such Existing Lender’s
outstanding Loans (as defined in the Existing Credit Agreement) and unfunded
Commitments (as defined in the Existing Credit Agreement) as in effect
immediately prior to the execution hereof.

 

60

 

(i)            Legal Opinions. 
The Administrative Agent shall have received, with a counterpart for
each Lender, (i) the executed legal opinion of Milbank, Tweed, Hadley
& McCloy LLP, special counsel to the Borrower and the other Loan Parties,
substantially in the form attached hereto as Exhibit E-1 and
(ii) the executed legal opinion of Irene Fisher, General Counsel of the
Borrower and the other Loan Parties, substantially in the form attached hereto
as Exhibit E-2.

 

(j)            Financial Statements. 
The Administrative Agent shall have received, with a copy for each Lender,
and each Lender shall have reviewed, and shall be satisfied with the financial
statements set forth in subsections 5.1(a) and (b).  The Pro Forma Balance Sheet shall be
consistent in all material respects with the sources and uses described in the
Commitment Letter and the financial projections provided to the Lenders
described in paragraph (k) below.

 

(k)           Projections. 
The Administrative Agent shall have received, with a copy for the
Arranger, projected balance sheets and related statements of income and cash
flows (including any and all supporting schedules and assumptions) of the
Borrower and its Subsidiaries after giving effect to the Transactions on an
annual basis for three years, commencing with the fiscal year ending September
30, 2005.

 

(l)            Actions to Perfect Liens. 
The Administrative Agent shall have received evidence in form and
substance satisfactory to it that all filings, recordings, registrations and
other actions, including, without limitation, the filing of duly executed
financing statements on form UCC-1 necessary or, in the opinion of the
Administrative Agent, desirable to perfect the Liens created by the Security
Documents shall have been completed.

 

(m)          Lien Searches. 
The Administrative Agent shall have received the results of a recent
search by a Person satisfactory to the Administrative Agent of the Uniform
Commercial Code filings which may have been filed with respect to personal
property of Wyeth in Delaware and each patent, trademark or copyright recorded
with the United States Patent and Trademark Office or the United States
Copyright Office, as applicable, and such search shall reveal no material liens
on any of the assets of such Loan Party except for liens permitted by the Loan
Documents.

 

(n)           Consents, Licenses and Approvals.  (i) All governmental and material third
party approvals (including material landlords’ and other consents) necessary in
connection with the execution, delivery and performance of the Loan Documents
and the continuing operation of the business of the Loan Parties shall have
been obtained and be in full force and effect, and (ii) all applicable
waiting periods shall have expired without any action being taken or threatened
by any competent Governmental Authority which would restrain, prevent or otherwise
impose material adverse conditions upon the Transactions.  The Administrative Agent shall have received
copies of all approvals referenced in clause (ii) above (certified by the
Secretary or Assistant Secretary of the Borrower as true and correct).

 

61

 

(o)           Designated Senior Indebtedness. 
(i) The Indebtedness under this Agreement shall be designated by
the Borrower as “Designated Senior Indebtedness” pursuant to, and as defined
under, the Indenture, dated as of September 23, 1997, among the Borrower, as
issuer, and The Bank of New York, as trustee, relating to the Existing Notes
(the “Existing Notes Indenture”), and (ii) the Administrative Agent
shall have received a certificate of the Borrower executed by the Secretary of
the Borrower satisfactory to the Administrative Agent reaffirming such
designation.

 

(p)           Solgar Acquisition. 
The Solgar Purchase Agreement shall be in full force and effect and the
Arranger shall have received copies thereof, as amended to the date
hereof.  The Arranger shall have received
copies, certified by the Secretary or an Assistant Secretary of the Borrower as
of the Effective Date, of all filings made with any Governmental Authority in
connection with the Transactions.  Each
of the Transactions (other than the extensions of credit hereunder) shall have
been (or shall be contemporaneously) consummated in accordance with the terms
hereof and the terms of documentation therefor (without waiver or amendment of
any condition (other than any immaterial condition the waiver or amendment of
which is not adverse to the Lenders) unless consented to in writing by the
Arranger) that are in form and substance reasonably satisfactory to the
Arranger (with any material condition therein requiring the satisfaction or
consent of any Person other than the Arranger or the Lenders being deemed to
require the reasonable satisfaction or consent of the Arranger).  Each of the parties thereto shall have
complied in all material respects with all covenants set forth in the Solgar
Purchase Agreement (without the waiver of performance under or amendment of any
of the terms thereof unless consented to in writing by the Arranger).  The Lenders shall have reviewed, and be
satisfied with, the ownership, corporate, legal, tax, management and capital
structure of the Borrower and its Subsidiaries after giving effect to the
Transactions and any indemnities, insurance, employment and other arrangements
entered into in connection with the Transactions.

 

(q)           Adequate Working Capital. 
The Lenders shall be satisfied that the Borrower and its Subsidiaries
will have adequate working capital and capital expenditure funds and
availability immediately after the Effective Date after giving effect to the
Transactions.

 

(r)            Litigation.  There shall
be no litigation or administrative proceeding (pending or threatened, other
than threatened litigation against Target that is subject to indemnity under
the Solgar Purchase Agreement), or proposed or pending regulatory changes in
law or regulations applicable to the Borrower or its Subsidiaries, that would
reasonably be expected to have a Material Adverse Effect or a material adverse
effect on the ability of the parties to consummate the Solgar Acquisition or
the other Transactions.

 

(s)           Indebtedness. 
Immediately after giving effect to the Transactions, the Borrower and
its Subsidiaries shall not have outstanding Indebtedness for borrowed

 

62

 

money or preferred stock
other than (w) Indebtedness under the Loan Documents, (x) the Existing Notes,
(y) Indebtedness permitted under subsection 8.2(c) or 8.2(i) and the
promissory note made by Holland & Barrett Europe Limited to the Borrower
and described on Schedule 8.2, and (z) other Indebtedness for borrowed
money, not to exceed $10,000,000 and as set forth on Schedule 6.3(s).

 

(t)            Documentation. 
The Lenders have received such other legal opinions, corporate documents
and other instruments and/or certificates as they may reasonably request.

 

(u)           Material Adverse Change. 
Since September 30, 2002, there has been no event or circumstance that
has resulted or could reasonably be expected to result in a material adverse
change in the business, assets, operations, properties, condition (financial or
otherwise), contingent liabilities (including as to products, and whether such
liabilities have been or yet may be asserted), prospects or material agreements
of the Target, Borrower and their respective Subsidiaries, taken as a whole (to
the best of the Borrower’s knowledge after due inquiry as to the Target and its
Subsidiaries only) or on the ability of the parties to consummate the Solgar
Acquisition or the other Transactions, except as disclosed in filings with the
U.S. Securities and Exchange Commission pursuant to the Exchange Act made on or
prior to June 13, 2005.

 

(v)           Execution by Lenders. 
This Agreement shall have been executed and delivered by (i) each
Term A Lender hereunder, (ii) the Existing Majority Lenders and
(iii) by a majority of lenders holding Term C Loans under the
Existing Credit Agreement.

 

SECTION 7.  AFFIRMATIVE COVENANTS

 

The
Borrower hereby agrees that, so long as the Commitments (or any of them) remain
in effect, any Loan or Reimbursement Obligation remains outstanding and unpaid
or any other amount is owing to any Lender or the Administrative Agent
hereunder or under any other Loan Document, the Borrower shall and shall cause
each of its Subsidiaries to:

 

7.1.          Financial
Statements.  Furnish to each Lender:

 

(a)           as soon as available, but in any event
within 90 days (or such earlier date on which the Borrower is required to file
a Form 10-K under the Exchange Act) after the end of each fiscal year of the
Borrower, copies of the consolidated and consolidating balance sheets of the
Borrower and its consolidated Subsidiaries as at the end of such year and the
related consolidated and consolidating statements of income and retained
earnings and of cash flows for such year, setting forth in each case in
comparative form the figures as of the end of and for the previous year,
reported on without a “going concern” or like qualification, assumption or
exception, or qualification arising out of the scope of the audit, by Deloitte
& Touche LLP or other independent certified public accountants of nationally
recognized standing; and

 

63

 

(b)           as soon as available, but in any event
not later than 45 days (or such earlier date on which the Borrower is required
to file a Form 10-Q under the Exchange Act) after the end of each of the first
three quarterly periods of each fiscal year of the Borrower, the unaudited
consolidated and consolidating balance sheets of the Borrower and its
consolidated Subsidiaries as at the end of such quarter and the related
unaudited consolidated and consolidating statements of income and retained
earnings and of cash flows of the Borrower and its consolidated Subsidiaries
for such quarter and the portion of the fiscal year through the end of such
quarter, setting forth in each case in comparative form the figures as of the
end of and for the corresponding period in the previous year, certified by a
Responsible Officer of the Borrower as being fairly stated in all material
respects (subject to normal year-end audit adjustments).

 

All
such financial statements shall be complete and correct in all material
respects and shall be prepared in reasonable detail and in accordance with GAAP
applied consistently throughout the periods reflected therein and with prior
periods (except that interim statements may exclude detailed footnote
disclosure in accordance with standard practice).  For purposes of this subsection 7.1,
information posted on Intralinks shall be deemed distributed to all Lenders.

 

7.2.          Certificates;
Other Information.  Furnish to each Lender:

 

(a)           concurrently with the delivery of the
financial statements referred to in subsection 7.1(a), a certificate of the
independent certified public accountants reporting on such financial statements
stating that in making the examination necessary therefor no knowledge was
obtained of any Default or Event of Default, except as specified in such
certificate;

 

(b)           concurrently with the delivery of the
financial statements referred to in subsections 7.1(a) and 7.1(b), a
certificate of a Responsible Officer of the Borrower stating that, to the best
of such officer’s knowledge, each Loan Party during such period has observed or
performed all of its covenants and other agreements, and satisfied every
condition, contained in this Agreement and the other Loan Documents to be
observed, performed or satisfied by it, and that such officer has obtained no
knowledge of any Default or Event of Default except as specified in such
certificate; and in the case of financial statements referred to in subsections
7.1(a) and 7.1(b), including calculations and information demonstrating in
reasonable detail compliance with the requirements of subsection 8.1 and
determining the Applicable Margins;

 

(c)           not later than 90 days following the end
of each fiscal year of the Borrower, a copy of the projections by the Borrower
of the operating budget of the Borrower and its Subsidiaries for the succeeding
fiscal year, such projections to be accompanied by a certificate of a
Responsible Officer of the Borrower to the effect that such projections have
been prepared on the basis of assumptions believed by the Borrower to be
reasonable at the time and that such officer has no reason to believe they are
incorrect or misleading in any material respect;

 

64

 

(d)           within five Business Days after the same
are filed, copies of all financial statements and reports which the Borrower
may make to, or file with, the Securities and Exchange Commission or any
successor or analogous Governmental Authority;

 

(e)           concurrently with the delivery of the
financial statements referred to in subsections 7.1(a) and 7.1(b), to the
extent not included in the financial statements and reports referred to in
subsection 7.2(d), a management narrative report explaining all significant
variances from forecasts, projections and previous results and all significant
current developments in staffing, marketing, sales and operations; and

 

(f)            promptly, such additional financial and
other information as any Lender may from time to time reasonably request.

 

7.3.          Payment
of Obligations.  Pay, discharge or otherwise satisfy at or
before maturity or before they become delinquent, as the case may be, all its
obligations of whatever nature (including taxes), except where the amount or
validity thereof is currently being contested in good faith by appropriate
proceedings and reserves in conformity with GAAP with respect thereto have been
provided on the books of the Borrower or its Subsidiaries, as the case may be.

 

7.4.          Maintenance
of Existence.  Preserve, renew and keep in full force and
effect its corporate existence and take all reasonable action to maintain all
rights, privileges and franchises necessary or desirable in the normal conduct
of its business except as otherwise permitted pursuant to subsection 8.5; and
comply with all Contractual Obligations and Requirements of Law except to the
extent that failure to comply therewith would not, in the aggregate, be
reasonably expected to have a Material Adverse Effect.

 

7.5.          Maintenance
of Property; Insurance.  Keep all property material to the conduct of
the business of the Borrower and its Subsidiaries, taken as a whole, in good
working order and condition; maintain with financially sound and reputable
insurance companies insurance on all its property in at least such amounts and
against at least such risks (but including in any event public liability,
product liability and business interruption) as are usually insured against in
the same general area by companies engaged in the same or a similar business;
and furnish to each Lender, upon written request, full information as to the
insurance carried.

 

7.6.          Inspection of
Property; Books and Records; Discussions.  Keep proper books of records
and account in which full, true and correct entries in conformity with GAAP and
all Requirements of Law shall be made of all dealings and transactions in
relation to its business and activities; and, upon prior written notice, permit
representatives of any Lender to visit and inspect any of its properties and
examine and make abstracts from any of its books and records 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
its Subsidiaries and, in the presence of an officer of the Borrower, with its
independent certified public accountants.

 

65

 

7.7.          Notices. 
Promptly give notice to the Administrative Agent (who shall promptly
notify each Lender) of:

 

(a)           the occurrence of any Default or Event of
Default;

 

(b)           any (i) default or event of default
under any Contractual Obligation of the Borrower or any of its Subsidiaries or (ii) litigation,
investigation or proceeding which may exist at any time between the Borrower or
any of its Subsidiaries and any Governmental Authority, which in either case,
if not cured or if adversely determined, as the case may be, would reasonably
be expected to have a Material Adverse Effect;

 

(c)           any litigation or proceeding (including
without limitation any notice of violation, alleged violation, liability or
potential liability under any Environmental Law)  that is filed or commenced (in each case after
the Closing Date) affecting the Borrower or any of its Subsidiaries in which
the amount claimed by the plaintiff is $1,000,000 or more and not covered by
insurance or in which injunctive or similar relief is sought;

 

(d)           any ERISA Event, that alone or together
with any other ERISA Events that have occurred, would reasonably be expected to
result in a liability of the Borrower and its Subsidiaries in an amount
exceeding $1,000,000 (as soon as possible and in any event within 30 days after
any Loan Party knows or has reason to know thereof); and

 

(e)           any development or event which has had or
would reasonably be expected to have a Material Adverse Effect.

 

Each
notice pursuant to this subsection shall be accompanied by a statement of a
Responsible Officer of the Borrower setting forth details of the occurrence
referred to therein and stating what action the Borrower proposes to take with
respect thereto.

 

7.8.          Environmental Laws.

 

(a)           Comply with, and ensure compliance by all
tenants and subtenants, if any, with, all applicable Environmental Laws and
obtain and comply in all respects with and maintain, and ensure that all
tenants and subtenants obtain and comply in all respects with and maintain, any
and all licenses, approvals, notifications, registrations or permits required
by applicable Environmental Laws, except to the extent that any failures could
not, in the aggregate, reasonably be expected to have a Material Adverse Effect
or to result in the payment of a Material Environmental Amount.

 

(b)           Conduct and complete all investigations,
studies, sampling and testing, and all remedial, removal and other actions
required under Environmental Laws and promptly comply in all material respects
with all lawful orders and directives of all Governmental Authorities regarding
Environmental Laws except to the extent that the same are being contested in
good

 

66

 

faith by appropriate proceedings and the
pendency of such proceedings could not be reasonably expected to have a
Material Adverse Effect.

 

7.9.          Additional Subsidiaries; Additional
Collateral.

 

(a)           With respect to any Domestic Subsidiary
created or acquired after the Closing Date by the Borrower, promptly cause such
Subsidiary to become a party to the Guarantee and Collateral Agreement, deliver
to the Administrative Agent the certificates representing the Capital Stock of
such Subsidiary, together with undated stock powers, executed in blank,
securing the Obligations as described in the Guarantee and Collateral Agreement
and covering the types of assets covered by the Guarantee and Collateral
Agreement, take all required actions to perfect the security interests created
by the Guarantee and Collateral Agreement in the assets of such Subsidiary and
if requested by the Administrative Agent, deliver to the Administrative Agent
legal opinions relating to the preceding matters, which opinions shall be in
form and substance, and from counsel, reasonably satisfactory to the
Administrative Agent.

 

(b)           With respect to each direct Material Foreign
Subsidiary of the Borrower or of any Domestic Subsidiary acquired or formed
after the Closing Date or a Foreign Subsidiary that otherwise becomes a direct
Material Foreign Subsidiary after the Closing Date (or with respect to such other
direct Foreign Subsidiaries as, together with all direct Material Foreign
Subsidiaries, constitute 80% or more of the assets or revenues (computed for
the most recent fiscal year) of the Foreign Subsidiaries, taken as a whole),
promptly after the acquisition or formation thereof or such other Foreign
Subsidiary becoming a direct Material Foreign Subsidiary, execute and deliver
and cause each such Foreign Subsidiary to execute and deliver to the
Administrative Agent, in form and substance reasonably satisfactory to the
Administrative Agent, such documents and instruments (including, without
limitation, pledge agreements) and take such action (including, without
limitation, the delivery of stock certificates and instruments) as the
Administrative Agent may reasonably request in order to grant to the
Administrative Agent, for the ratable benefit of the Lenders, as collateral
security for the Obligations, a first priority perfected security interest in
65% of the voting Capital Stock and 100% of the non-voting Capital Stock of, or
equivalent ownership interests in, such direct Foreign Subsidiary, along with
any warrants, options, or other rights to acquire the same, in all cases to the
extent legally permissible and practicable and deliver to the Administrative
Agent such legal opinions as it shall reasonably request with respect
thereto.  For purposes of this subsection
7.9(b), “direct” means directly held by the Borrower or any Domestic
Subsidiary.

 

(c)           If requested by the Administrative Agent,
grant in favor of the Administrative Agent, for the benefit of the Lenders,
Liens on any other assets other than real property (owned or leased) hereafter
acquired by the Borrower or any Domestic Subsidiary and on previously
encumbered assets which become unencumbered, to the extent such Liens are then
permissible under applicable law and pursuant to any agreements to which the
Borrower or its Subsidiaries are a party, pursuant to documentation in form and
substance reasonably satisfactory to the Administrative Agent.

 

67

 

(d)           In connection with any Acquisition, to the
extent not otherwise provided for in this subsection 7.9, take all action
necessary to assure that security interests and Liens for the benefit of the
Lenders are granted and perfected in all material assets acquired in such
Acquisition (including assets of Subsidiaries acquired in such Acquisition),
subject in each case to Liens permitted under subsection 8.3.

 

7.10.        Purchase
Agreement Remedies.  Enforce and pursue all remedies available to
it under each of the Rexall Purchase Agreement and the Solgar Purchase
Agreement, including, without limitation, indemnification rights, which
enforcement and pursuit are reasonable and practicable in the Borrower’s good
faith and reasonable business judgment.

 

SECTION 8.  NEGATIVE COVENANTS

 

The
Borrower hereby agrees that, so long as the Commitments (or any of them) remain
in effect, any Loan or Reimbursement Obligation remains outstanding and unpaid
or any other amount is due and payable to any Lender or the Administrative
Agent hereunder or under any other Loan Document, the Borrower shall not, and
shall not permit any of its Subsidiaries to, directly or indirectly:

 

8.1.          Financial Condition Covenants.

 

(a)           [Intentionally Omitted].

 

(b)           Maintenance of Consolidated Interest Coverage
Ratio.  Permit at the end of each fiscal quarter of
the Borrower a Consolidated Interest Coverage Ratio of less than 5.00x.

 

(c)           Maintenance of Consolidated Indebtedness to
Consolidated EBITDA Ratio.  Permit at any time the ratio of
(i) Consolidated Indebtedness to (ii) Consolidated EBITDA for the
four fiscal quarters most recently ended on or prior to such date, to be
greater than 2.50 to 1.0.

 

(d)           Maintenance of Consolidated Senior
Indebtedness to Consolidated EBITDA Ratio.  Permit at any time the ratio
of (i) Consolidated Senior Indebtedness to (ii) Consolidated EBITDA
for the four fiscal quarters most recently ended on or prior to such date, to
be greater than 1.50 to 1.0.

 

8.2.          Limitation
on Indebtedness.  Create, incur, assume or suffer to exist any
Indebtedness, except:

 

(a)           Indebtedness of the Borrower or any
Subsidiary under this Agreement or any other Loan Document;

 

(b)           existing Indebtedness of the Borrower and
its Subsidiaries listed on Schedule 8.2 and any Refinancing Indebtedness
in respect thereof;

 

68

 

(c)           Indebtedness of the Borrower to any
Subsidiary of the Borrower and of any Domestic Subsidiary to the Borrower or to
any other Subsidiary of the Borrower, provided that such indebtedness is
evidenced by a promissory note that is pledged to the Administrative Agent in
accordance with the Guarantee and Collateral Agreement;

 

(d)           Indebtedness under sale and leaseback
transactions permitted by subsection 8.12;

 

(e)           Indebtedness of the Borrower under Hedge
Agreements entered into solely to hedge interest rate exposure and not for
speculative purposes;

 

(f)            Indebtedness of the Borrower or any
Subsidiary incurred to finance the acquisition, construction or improvement of
any fixed or capital assets, including obligations under Financing Leases and
any Indebtedness assumed in connection with the acquisition of any such assets
or secured by a Lien on any such assets prior to the acquisition thereof which
Lien was not created in contemplation of such acquisition and on any
extensions, renewals and replacements of any such Indebtedness that do not
increase the outstanding principal amount thereof; provided that
(A) such Indebtedness is incurred prior to or within 120 days (150 days in
the case of the Hazle Township Facility) after such acquisition or the
completion of such construction or improvement and (B) the aggregate
principal amount of Indebtedness permitted by this paragraph (f), and the aggregate
amount of sale-leaseback transactions permitted under subsection 8.12
theretofore consummated, shall not exceed $25,000,000 at any time outstanding;

 

(g)           Indebtedness of any Person that becomes a
Subsidiary after the date hereof; provided that (A) such Indebtedness
exists at the time such Person becomes a Subsidiary and is not created in
contemplation of or in connection with such Person becoming a Subsidiary and
(B) the aggregate principal amount of Indebtedness permitted by this
paragraph (g) shall not exceed $5,000,000 at any time outstanding;

 

(h)           Indebtedness of any Foreign Subsidiaries,
in addition to Indebtedness permitted by paragraph (i), in an aggregate amount
not in excess of $5,000,000 at any time outstanding;

 

(i)            Indebtedness of any Foreign Subsidiary to
the Borrower or any other Subsidiary; provided that (A) the aggregate
principal amount of Indebtedness of Holland & Barrett to the Borrower and
the Domestic Subsidiaries, taken together with guarantees of obligations of
Holland & Barrett permitted under subsection 8.4(g) and investments in
Holland & Barrett permitted under subsection 8.9(d), shall not exceed
$25,000,000 at any time outstanding, and (B) the aggregate principal
amount of Indebtedness of Foreign Subsidiaries other than Holland & Barrett
to the Borrower and the Domestic Subsidiaries, taken together with guarantees
of obligations of Foreign Subsidiaries other than Holland & Barrett
permitted under subsection 8.4(f) and investments in Foreign Subsidiaries other

 

69

 

than Holland &
Barrett permitted under subsection 8.9(d), shall not exceed $10,000,000 at any
time outstanding;

 

(j)            Refinancing Indebtedness incurred in
order to refinance in whole or in part the Obligations; and

 

(k)           other unsecured Indebtedness in an
aggregate principal amount not exceed $20,000,000 at any time outstanding.

 

8.3.          Limitation
on Liens.  Create, incur, assume or suffer to exist any
Lien upon any of its property, assets or revenues, whether now owned or
hereafter acquired, except for:

 

(a)           Liens for taxes not yet due or which are
being contested in good faith by appropriate proceedings, provided that
adequate reserves with respect thereto are maintained on the books of such
Person in conformity with GAAP (or, in the case of Foreign Subsidiaries,
generally accepted accounting principles in effect from time to time in their
respective jurisdictions of incorporation);

 

(b)           carriers’, warehousemen’s, mechanics’,
materialmen’s, repairmen’s or other like Liens arising in the ordinary course
of business which are not overdue for a period of more than 60 days or which
are being contested in good faith by appropriate proceedings;

 

(c)           pledges or deposits in connection with
workers’ compensation, unemployment insurance and other social security
legislation;

 

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

 

(e)           easements, zoning restrictions,
rights-of-way, restrictions and other similar encumbrances incurred in the
ordinary course of business which do not secure any monetary obligations and do
not in any case materially detract from the value of the property subject
thereto or materially interfere with the ordinary conduct of the business of
such Person;

 

(f)            Liens (i) existing as of the Closing
Date and listed on Schedule 8.3 and extensions, renewals and
replacements thereof that do not increase the outstanding principal amount
thereof, and (ii) previously identified in writing to the Administrative Agent,
arrangements for the release of which satisfactory to the Administrative Agent
have been made;

 

70

 

(g)           Liens securing Indebtedness of the
Borrower permitted by subsection 8.2(f) incurred to finance the acquisition of
fixed or capital assets (whether pursuant to a loan, a Financing Lease or
otherwise), provided that (i) such Liens shall be created
substantially simultaneously with the acquisition of such fixed or capital
assets, (ii) such Liens do not at any time encumber any property other
than the property financed by such Indebtedness, (iii) the amount of
Indebtedness secured thereby is not increased and (iv) the principal
amount of Indebtedness secured by any such Lien shall at no time exceed the
original purchase price of such property at the time it was acquired;

 

(h)           Liens on current assets of any Foreign
Subsidiary securing Indebtedness of such Foreign Subsidiary permitted under
subsection 8.2(i);

 

(i)            Liens (not otherwise permitted hereunder)
which secure obligations in aggregate amount at any time outstanding not
exceeding (as to the Borrower and all Subsidiaries), and on property with an
aggregate value not exceeding, $5,000,000;

 

(j)            Liens created pursuant to the Security
Documents;

 

(k)           Liens securing Indebtedness permitted by
subsection 8.2(g) to the extent such Lien is secured at the time that such
Person becomes a Subsidiary and was not incurred in contemplation thereof;

 

(l)            judgment Liens in respect of judgments
that do not, in the aggregate, constitute an Event of Default under clause (j)
of Section 9;

 

(m)          Liens on Indebtedness incurred pursuant
to the proviso of subsection 8.10(a); and

 

(n)           Liens (not otherwise permitted hereunder)
upon assets which are not subject to the Lien of the Security Documents which
secure obligations in an aggregate amount at any time outstanding not to exceed
$20,000,000.

 

8.4.          Limitation
on Guarantee Obligations.  Create, incur, assume or suffer to exist any
Guarantee Obligation except:

 

(a)           Guarantee Obligations in existence on the
date hereof and listed on Schedule 8.4 and Guarantee Obligations in
respect of any Refinancing Indebtedness of the Indebtedness to which such
Guarantee Obligations listed on Schedule 8.4 relate;

 

(b)           Guarantee Obligations incurred after the
date hereof in an aggregate amount not to exceed $5,000,000 at any one time
outstanding;

 

71

 

(c)           guarantees made in the ordinary course of
its business by the Borrower of obligations of any of its Domestic
Subsidiaries, which obligations are otherwise permitted under this Agreement;

 

(d)           the guarantee by the Domestic Subsidiaries
under the Guarantee and Collateral Agreement;

 

(e)           guarantees of any Foreign Subsidiary of
the obligations of any other Foreign Subsidiary;

 

(f)            guarantees by the Borrower of obligations
of Foreign Subsidiaries other than Holland & Barrett; provided that
the aggregate amount of such guarantees, taken together with Indebtedness of
Foreign Subsidiaries other than Holland & Barrett permitted under
subsection 8.2(i) and investments in Foreign Subsidiaries other than Holland
& Barrett permitted under subsection 8.9(d), shall not exceed $10,000,000
at any time outstanding; and

 

(g)           guarantees by the Borrower of obligations
of Holland & Barrett; provided that the aggregate amount of such
guarantees, taken together with Indebtedness of Holland & Barrett permitted
under subsection 8.2(i) and investments in Holland & Barrett permitted
under subsection 8.9(d), shall not exceed $25,000,000 at any time outstanding.

 

8.5.          Limitation
on Fundamental Changes.  Enter into any merger, consolidation or
amalgamation, or liquidate, wind up or dissolve itself (or suffer any
liquidation or dissolution), or convey, sell, lease, assign, transfer or
otherwise dispose of, all or substantially all of its property, business or
assets, except:

 

(a)           any Subsidiary of the Borrower may be
merged or consolidated with or into the Borrower (provided that the
Borrower shall be the continuing or surviving corporation) or with or into any
one or more wholly owned Subsidiaries of the Borrower (provided that if
a Domestic Subsidiary is a party to such transaction, such Domestic Subsidiary
shall be the continuing or surviving corporation);

 

(b)           any wholly owned Subsidiary may sell,
lease, transfer or otherwise dispose of any or all of its assets (upon
voluntary liquidation or otherwise) to the Borrower or any other wholly owned
Domestic Subsidiary of the Borrower; and

 

(c)           any Subsidiary may liquidate or dissolve
if the Borrower determines in good faith that such liquidation or dissolution
is in the best interests of the Borrower and its Subsidiaries, taken as a
whole, and is not materially disadvantageous to the Lenders.

 

8.6.          Limitation
on Sale of Assets.  Convey, sell, lease, assign, transfer or
otherwise dispose of any of its property, business or assets (including,
without limitation, receivables and leasehold interests), whether now owned or
hereafter acquired, or, in the case of any

 

72

 

Subsidiary, issue or sell any shares of such
Subsidiary’s Capital Stock to any Person other than the Borrower or any wholly
owned Domestic Subsidiary, except:

 

(a)           the sale or other disposition of obsolete
or worn out property in the ordinary course of business;

 

(b)           the sale of inventory in the ordinary
course of business;

 

(c)           as permitted by subsection 8.5(b) or (c);

 

(d)           the sale or other disposition of property
listed on Schedule 8.6(d); and

 

(e)           the sale or other disposition of any
other property at fair market value for consideration not in excess of
$25,000,000 in the aggregate in any fiscal year.

 

8.7.          Limitation
on Dividends and Other Restricted Payments.  Declare or pay any dividend
(other than dividends payable solely in its common stock) on, or make any
payment on account of, or set apart assets for a sinking or other analogous
fund for, the purchase, redemption, defeasance, retirement or other acquisition
of, any shares of any class of Capital Stock of the Borrower or any Subsidiary
or any warrants or options to purchase any such Capital Stock, whether now or
hereafter outstanding, or make any other distribution in respect thereof,
either directly or indirectly, whether in cash or property or in obligations of
the Borrower or any Subsidiary thereof (such declarations, payments, setting
apart, purchases, redemptions, defeasances, retirements, acquisitions and
distributions being herein called “Restricted Payments”) except (a) as
permitted by subsections 8.5 or 8.9, (b) any Subsidiary may pay dividends to
the Borrower or any other Subsidiary, (c) the Borrower or any Subsidiary may
make Restricted Payments pursuant to and in accordance with customary stock
option plans or other customary benefit plans for management or employees of
the Borrower and its Subsidiaries, and (d) the Borrower may repurchase, and/or
pay dividends in respect of, Capital Stock of the Borrower in an amount not to
exceed $10,000,000 in the aggregate during any fiscal year of the Borrower.

 

8.8.          Limitation on Capital
Expenditures.  Make any Capital Expenditure except for
Capital Expenditures by the Borrower and its Subsidiaries in the ordinary
course of business not exceeding $75,000,000 in the aggregate during any fiscal
year of the Borrower; provided, however, that (x) if the aggregate amount of
Capital Expenditures made in any fiscal year shall be less than the maximum
amount of Capital Expenditures permitted under this subsection 8.8 for such
fiscal year (before giving effect to any carryover), then an amount of such
shortfall not exceeding 50% of such maximum amount may be added to the amount
of Capital Expenditures permitted under this subsection 8.8 for the immediately
succeeding (but not any other) fiscal year, and (y) in determining whether
any amount is available for carryover, the amount expended in any fiscal year
shall first be deemed to be from the amount allocated to such fiscal year
(before giving effect to any carryover).

 

73

 

8.9.          Limitation
on Investments, Loans and Advances.  Make any advance, loan, extension of credit
or capital contribution to, or purchase any stock, bonds, notes, debentures or
other securities of or any assets constituting a business unit of, or make any
other investment in, any Person, except:

 

(a)           extensions of trade credit in the
ordinary course of business;

 

(b)           investments in Cash Equivalents;

 

(c)           loans and advances to employees of the
Borrower or its Subsidiaries for travel, entertainment and relocation expenses
in the ordinary course of business in an aggregate amount for the Borrower and
its Subsidiaries not to exceed $1,000,000 at any one time outstanding;

 

(d)           investments by the Borrower or its
Subsidiaries in any wholly owned Subsidiary of the Borrower which has complied
with the conditions set forth in subsection 7.9(a) or any wholly owned Foreign
Subsidiary which has complied with the conditions set forth in subsection
7.9(b); provided that (A) the aggregate amount of all such advances,
loans, investments, transfers or guarantees by the Borrower and the Domestic
Subsidiaries made to or on behalf of Holland & Barrett, taken together with
loans to Holland & Barrett permitted under subsection 8.2(i) and guarantees
of obligations of Holland & Barrett permitted under subsection 8.4(g),
shall not exceed $25,000,000 at any time outstanding, and (B) the aggregate
amount of all such advances, loans, investments, transfers or guarantees by the
Borrowers and the Domestic Subsidiaries made to or on behalf of the Foreign
Subsidiaries other than Holland & Barrett, taken together with loans to
Foreign Subsidiaries other than Holland & Barrett permitted under subsection
8.2(i) and guarantees of obligations of Foreign Subsidiaries other than Holland
& Barrett permitted under subsection 8.4(f), shall not exceed $10,000,000
at any time outstanding.

 

(e)           investments by the Borrower and its
Subsidiaries existing on the Closing Date and set forth on Schedule 8.9(e);

 

(f)            the Rexall Acquisition and the Solgar
Acquisition;

 

(g)           other Acquisitions; provided that
(i) such Acquisitions permitted pursuant to this paragraph (g) shall be
nonhostile acquisitions and (ii) the aggregate amount of investments
(whether cash, securities or other consideration) permitted pursuant to this
paragraph (g) from and after the Effective Date shall not exceed in the
aggregate the sum of $150,000,000; and

 

(h)           additional investments not to exceed
$15,000,000 in the aggregate while this Agreement is outstanding.

 

74

 

8.10.        Limitation on Optional Payments and
Modifications of Debt Instruments.

 

(a)           Make any optional payment or prepayment on or
redemption or purchase of any Indebtedness in excess of $15,000,000 per fiscal
year (other than in respect of (i) the Loans, (ii) the Existing Notes
and (iii) any Refinancing Indebtedness in respect of the Existing Notes,
to the extent such payment, prepayment, redemption or purchase under the
foregoing clauses (ii) and (iii) is financed with Refinancing
Indebtedness); provided, that
notwithstanding clause (ii) of the definition of Refinancing Indebtedness,
the Borrower or any Subsidiary may prepay Subordinated Debt with the proceeds
of an incurrence of senior secured debt or senior unsecured notes if the ratio
of Consolidated Indebtedness to Consolidated EBITDA (calculated after giving
pro forma effect to the borrowings to be made on the date of such incurrence and
to any change in Consolidated EBITDA and any increase in Consolidated
Indebtedness resulting from the consummation of any acquisition or disposition
permitted by this Agreement concurrently with such borrowings) is less than
2.00 to 1.0,

 

(b)           amend, modify or change, or consent or agree
to any amendment, modification or change to, any of the terms of any
Indebtedness (excluding the Loans) (other than any such amendment, modification
or change which would extend the maturity or reduce the amount of any payment
of principal thereof or which would reduce the rate or extend the date for
payment of interest thereon), or

 

(c)           amend, modify or change (i) the
subordination provisions of any Subordinated Debt or any Refinancing
Indebtedness in respect thereof; provided that notwithstanding clause
(ii) of the definition of Refinancing Indebtedness, Borrower or any
Subsidiary may prepay Subordinated Debt with the proceeds of an incurrence of
secured debt or senior unsecured notes if the ratio of Consolidated Indebtedness
to Consolidated EBITDA (calculated after giving pro forma effect to the
borrowings to be made on the date of such incurrence and to any change in
Consolidated EBITDA and any increase in Consolidated Indebtedness resulting
from the consummation of any acquisition or disposition permitted by this
Agreement concurrently with such borrowings) is less than 2.0 to 1.0 or
(ii) the provisions (including, without limitation, definitions and
schedules) in the Rexall Purchase Agreement or the Solgar Purchase Agreement
providing the Borrower with indemnification rights, other than, with respect to
this clause (ii), any immaterial provision the amendment, modification or
change of which would not adversely affect the Borrower.

 

8.11.        Limitation
on Transactions with Affiliates.  Enter into any transaction, including,
without limitation, any purchase, sale, lease or exchange of property or the
rendering of any service, with any Affiliate unless such transaction is
(a) otherwise permitted under this Agreement and (b) upon fair and
reasonable terms no less favorable to the Borrower or such Subsidiary, as the
case may be, than it would obtain in a comparable arm’s length transaction with
a Person which is not an Affiliate.

 

8.12.        Limitation
on Sales and Leasebacks.  Enter into any arrangement with any Person
providing for the leasing by the Borrower or any Subsidiary of real or personal
property

 

75

 

which has been or is to be sold or
transferred by the Borrower or such Subsidiary to such Person or to any other
Person to whom funds have been or are to be advanced by such Person on the
security of such property or rental obligations of the Borrower or such
Subsidiary; provided that such sale leaseback transactions in an amount
of, together with the aggregate principal amount of Indebtedness permitted
under subsection 8.2(f) then outstanding, up to $20,000,000 in the aggregate
while this Agreement is in effect may be consummated by the Borrower; provided
that the Borrower will not mortgage any existing Fee Property or Leased
Property (including, without limitation, the Gel-Cap Facility but excluding the
Hazle Township Facility) other than any mortgage to which such Fee Property or
Leased Property is subject on the Closing Date (or any other mortgage in
respect thereof so long as the related Indebtedness constitutes Refinancing
Indebtedness).

 

8.13.        Limitation
on Changes in Fiscal Year.  Permit the fiscal year of the Borrower to end
on a day other than September 30.

 

8.14.        Limitation
on Negative Pledge Clauses.  Enter into with any Person any agreement,
other than (a) this Agreement and the other Loan Documents, (b) the
Subordinated Debt and any Refinancing Indebtedness in respect thereof (so long
as such Refinancing Indebtedness addresses prohibitions or limitations of the
nature described below in a manner not less favorable to the Lenders, taken as
a whole, than the treatment thereof in the Subordinated Debt) and (c) any
industrial revenue bonds, purchase money mortgages or Financing Leases
permitted by this Agreement (in which cases, any prohibition or limitation
shall only be effective against the assets financed thereby), which prohibits
or limits the ability of the Borrower or any of its Subsidiaries to create,
incur, assume or suffer to exist any Lien upon any of its property, assets or
revenues, whether now owned or hereafter acquired; provided that the
foregoing shall not apply to (i) restrictions and conditions imposed by law,
(ii) customary restrictions and conditions contained in agreements relating to
the sale of a Subsidiary permitted hereunder pending such sale, provided such
restrictions or conditions apply only to the Subsidiary that is to be sold,
(iii) restrictions or conditions imposed by any agreement relating to secured
Indebtedness permitted hereunder if such restrictions or conditions apply only
to the property or assets securing such Indebtedness and (iv) customary
provisions in leases and other contracts restricting the assignment thereof.

 

8.15.        Limitation on Lines of
Business.  Enter into any business, either directly or
through any Subsidiary, except for the nutritional supplements and healthfood
businesses and business reasonably related thereto.

 

8.16.        Hedging
Agreements.  Enter into any Hedging Agreement, except
(a) Hedging Agreements entered into to hedge or mitigate risks to which
the Borrower or any Subsidiary has actual exposure (other than those in respect
of Capital Stock of the Borrower or any of its Subsidiaries) and (b) Hedging
Agreements entered into in order to effectively cap, collar or exchange
interest rates (from fixed to floating rates, from one floating rate to another
floating

 

76

 

rate or otherwise) with respect to any
interest-bearing liability or investment of the Borrower or any Subsidiary.

 

8.17.        Rexall
and Solgar Acquisitions.  Notwithstanding anything to the contrary
herein, each of the transactions contemplated by the Rexall Purchase Agreement
and consummated on the Closing Date and the transactions contemplated by the
Solgar Purchase Agreement and consummated on the Effective Date shall not be
deemed to violate the provisions of this Section 8.

 

SECTION 9.  EVENTS OF DEFAULT

 

Upon
the occurrence of any of the following events:

 

(a)           The Borrower shall fail to pay
(i) any principal of any Loans or any Reimbursement Obligations when due
(whether at the stated maturity, by acceleration or otherwise) in accordance
with the terms thereof or hereof or (ii) any interest on any Loans, or any
fee or other amount payable hereunder, within five days after any such
interest, fee or other amount becomes due in accordance with the terms hereof;
or

 

(b)           Any representation or warranty made or
deemed made by the Borrower or any other Loan Party herein or in any other Loan
Document or which is contained in any certificate, document or financial or
other statement furnished at any time under or in connection with this
Agreement or any other Loan Document shall prove to have been incorrect in any
material respect on or as of the date made or deemed made or furnished; or

 

(c)           The Borrower or any other Loan Party
shall default in the observance or performance of any covenant contained in
Section 8 hereof or in any negative covenant contained in any Security Document
to which it is a party; or

 

(d)           The Borrower or any other Loan Party
shall default in the observance or performance of any other agreement contained
in this Agreement or any other Loan Document other than as provided in (a)
through (c) above, and such default shall continue unremedied for a period of
the greater of (x) 30 days,  and (y) 60
days (if the Borrower or such Loan Party is diligently pursuing a remedy of
such default) after the earlier to occur of (A) actual knowledge of such
default by a Responsible Officer of the Borrower and (B) notice from the
Administrative Agent to the Borrower; or

 

(e)           Any Loan Document shall cease, for any
reason, to be in full force and effect, or the Borrower or any other Loan Party
shall so assert; or any security interest created by any of the Security
Documents in a material portion of the Collateral (as defined in the Guarantee
and Collateral Agreement) shall cease to be enforceable and of the same effect
and priority purported to be created thereby and, in each case, shall remain
unremedied for a period of 10 days; or

 

77

 

(f)            The subordination provisions contained in
any instrument pursuant to which any Subordinated Debt or Refinancing
Indebtedness in respect thereof was created or in any instrument evidencing the
same shall, so long as such Subordinated Debt or Refinancing Indebtedness shall
be outstanding, cease, for any reason, to be in full force and effect or
enforceable in accordance with its terms; or

 

(g)           The Borrower or any of its Subsidiaries
shall (i) default in any payment of principal of or interest on any
Indebtedness (other than Indebtedness under this Agreement), in the payment of
any Guarantee Obligation or in the payment of any Hedge Agreement Obligation,
where, in any case or in the aggregate, the principal amount thereof then
outstanding exceeds $5,000,000, beyond the period of grace, if any, provided in
the instrument or agreement under which such Indebtedness, Guarantee Obligation
or Hedge Agreement Obligation was created; or (ii) default in the
observance or performance of any other agreement or condition relating to any
such Indebtedness, Guarantee Obligation or Hedge Agreement Obligation or
contained in any instrument or agreement evidencing, securing or relating
thereto, or any other event shall occur or condition exist, the effect of which
default or other event or condition is to cause, or to permit the holder or
holders of such Indebtedness or Hedge Agreement Obligation or, beneficiary or
beneficiaries of such Guarantee Obligation (or a trustee or agent on behalf of
such holder or holders or beneficiary or beneficiaries) to cause, with the
giving of notice if required, such Indebtedness to become due prior to its
stated maturity or such Guarantee Obligation to become payable; or

 

(h)           (i) The Borrower, any Domestic
Subsidiary or any Material Foreign Subsidiary shall commence any case,
proceeding or other action (A) under any existing or future law of any
jurisdiction, domestic or foreign, relating to bankruptcy, insolvency,
reorganization or relief of debtors, seeking to have an order for relief
entered with respect to it, or seeking to adjudicate it a bankrupt or
insolvent, or seeking reorganization, arrangement, adjustment, winding-up,
liquidation, dissolution, composition or other relief with respect to it or its
debts, or (B) seeking appointment of a receiver, trustee, custodian or
other similar official for it or for all or any substantial part of its assets,
or the Borrower, any Domestic Subsidiary or any Material Foreign Subsidiary
shall make a general assignment for the benefit of its creditors; or
(ii) there shall be commenced against the Borrower, any Domestic
Subsidiary or any Material Foreign Subsidiary any case, proceeding or other action
of a nature referred to in clause (i) above which (A) results in the
entry of an order for relief or any such adjudication or appointment or
(B) remains undismissed, undischarged or unbonded for a period of 60 days;
or (iii) there shall be commenced against the Borrower, any Domestic
Subsidiary or any Material Foreign Subsidiary any case, proceeding or other
action seeking issuance of a warrant of attachment, execution, distraint or
similar process against all or any substantial part of its assets which results
in the entry of an order for any such relief which shall not have been vacated,
discharged, or stayed or bonded pending appeal within 60 days from the entry
thereof; or (iv) the Borrower, any Domestic Subsidiary or any Material
Foreign Subsidiary shall take any action

 

78

 

in furtherance of, or
indicating its consent to, approval of, or acquiescence in, any of the acts set
forth in clause (i), (ii), or (iii) above; or (v) the Borrower, any
Domestic Subsidiary or any Material Foreign Subsidiary shall generally not, or
shall be unable to, or shall admit in writing its inability to, pay its debts
as they become due; or

 

(i)            an ERISA Event shall have occurred that,
when taken together with all other ERISA Events that have occurred, could
reasonably be expected to result in liability of the Borrower and its
Subsidiaries in an aggregate amount exceeding $5,000,000; or

 

(j)            One or more judgments or decrees shall be
entered against the Borrower or any of its Subsidiaries involving in the
aggregate a liability (not paid by insurance or otherwise fully covered by
insurance or paid by a third-party indemnitor) of $5,000,000 or more and all
such judgments or decrees shall not have been vacated, discharged, stayed or bonded
pending appeal within 30 days from the entry thereof; or

 

(k)           (i) Any Person or “group” (within
the meaning of Section 13(d) or 15(d) of the Exchange Act), other than any
Person or group owning 10% or more of the Capital Stock of the Borrower on the
date hereof (A) shall have acquired, combined with previous holdings,
beneficial ownership of 25% or more of any outstanding class of capital stock
of the Borrower having ordinary voting power in the election of directors or
(B) shall obtain the power (whether or not exercised) to elect a majority
of the Borrower’s directors or (ii) the Board of Directors of the Borrower
shall not consist of a majority of Continuing Directors;

 

then,
and in any such event, (A) if such event is an Event of Default specified
in clause (i) or (ii) of paragraph (h) above with respect to the
Borrower or if such event is an Event of Default specified in clause (g) above
resulting from the acceleration of the Subordinated Debt automatically the
Commitments shall immediately terminate and the Loans hereunder (with accrued
interest thereon) and all other amounts owing under this Agreement (including,
without limitation, all Reimbursement Obligations, regardless of whether or not
such Reimbursement Obligations are then due and payable) shall immediately
become due and payable, and (B) if such event is any other Event of
Default, any of the following actions may be taken:  (i) with the consent of the Majority
Lenders, the Administrative Agent may, or upon the direction of the Majority
Lenders, the Administrative Agent shall, by notice to the Borrower declare the
Commitments to be terminated forthwith, whereupon the Commitments shall
immediately terminate; (ii) with the consent of the Majority Lenders, the
Administrative Agent may, or upon the direction of the Majority Lenders, the
Administrative Agent shall, by notice of default to the Borrower, declare the
Loans hereunder (with accrued interest thereon) and all other amounts owing
under this Agreement  (including, without
limitation, all Reimbursement Obligations, regardless of whether or not such
Reimbursement Obligations are then due and payable) to be due and payable
forthwith, whereupon the same shall immediately become due and payable and
(iii) with the consent of the Majority Lenders the Administrative Agent
may, and upon the direction of the Majority Lenders,

 

79

 

the Administrative Agent shall, exercise any
and all remedies and other rights provided pursuant to this Agreement and/or
the other Loan Documents.

 

With
respect to all Letters of Credit with respect to which presentment for honor
shall not have occurred at the time of an acceleration pursuant to the
preceding paragraph, the Borrower shall at such time deposit in a cash
collateral account opened by the Administrative Agent an amount equal to the
aggregate then undrawn and unexpired amount of such Letters of Credit.  The Borrower hereby grants to the
Administrative Agent, for the benefit of the Issuing Lender and the
Participating Lenders, a security interest in such cash collateral to secure
all obligations of the Borrower under this Agreement and the other Loan
Documents.  Amounts held in such cash
collateral account shall be applied by the Administrative Agent to the payment
of drafts drawn under such Letters of Credit, and the unused portion thereof
after all such Letters of Credit shall have expired or been fully drawn upon,
if any, shall be applied to repay other obligations of the Borrower hereunder
and under the Notes.  After all such
Letters of Credit shall have expired or been fully drawn upon, all
Reimbursement Obligations shall have been satisfied and all other obligations
of the Borrower hereunder and under the Notes shall have been paid in full, the
balance, if any, in such cash collateral account shall be returned to the
Borrower.  The Borrower shall execute and
deliver to the Administrative Agent, for the account of the Issuing Lender and
the Participating Lenders, such further documents and instruments as the
Administrative Agent may request to evidence the creation and perfection of the
within security interest in such cash collateral account.

 

Except
as expressly provided above in this Section 9, presentment, demand, protest and
all other notices of any kind are hereby expressly waived.

 

SECTION 10.  THE AGENTS AND THE ARRANGER

 

10.1.        Appointment.  Each Lender hereby irrevocably
designates and appoints JPMorgan Chase as the Administrative Agent and as the
Collateral Agent of such Lender under this Agreement and the other Loan
Documents, and each Lender irrevocably authorizes each of the Administrative
Agent and the Collateral Agent, in such respective capacities, to take such
action on its behalf under the provisions of this Agreement and the other Loan
Documents and to exercise such powers and perform such duties as are expressly
delegated to the Administrative Agent and the Collateral Agent, as the case may
be, by the terms of this Agreement and the other Loan Documents, together with
such other powers as are reasonably incidental thereto.  Each Lender hereby irrevocably designates and
appoints Bank of America, N.A. as the Syndication Agent of such Lender under
this Agreement and the other Loan Documents, and each Lender irrevocably
authorizes the Syndication Agent, in such capacity, to take such action on its
behalf under the provisions of this Agreement and the other Loan Documents and
to exercise such powers and perform such duties as are expressly delegated to
the Syndication Agent by the terms of this Agreement and the other Loan
Documents, together with such other powers as are reasonably incidental
thereto.  Notwithstanding any provision
to the contrary elsewhere in this Agreement, no Agent shall have any duties or
responsibilities, except those expressly set forth herein,

 

80

 

or any fiduciary relationship with any
Lender, and no implied covenants, functions, responsibilities, duties,
obligations or liabilities shall be read into this Agreement or any other Loan
Document or otherwise exist against any Agent.

 

10.2.        Delegation
of Duties.  Each Agent may execute any of its duties
under this Agreement and the other Loan Documents by or through agents or
attorneys-in-fact and shall be entitled to advice of counsel concerning all
matters pertaining to such duties.  No
Agent shall be responsible for the negligence or misconduct of any agents or
attorneys-in-fact selected by it with reasonable care.

 

10.3.        Exculpatory
Provisions.  No Agent or any of its officers, directors,
employees, agents, attorneys-in-fact or Affiliates shall be (i) liable for
any action lawfully taken or omitted to be taken by it or such Person under or
in connection with this Agreement or any other Loan Document (except for its or
such Person’s own gross negligence or willful misconduct) or
(ii) responsible in any manner to any of the Lenders for any recitals,
statements, representations or warranties made by the Borrower or any officer
thereof contained in this Agreement or any other Loan Document or in any
certificate, report, statement or other document referred to or provided for
in, or received by such Agent under or in connection with, this Agreement or
any other Loan Document or for the value, validity, effectiveness, genuineness,
enforceability or sufficiency of this Agreement or any other Loan Document or
for any failure of the Borrower to perform its obligations hereunder or
thereunder.  No Agent shall be under any
obligation to any Lender to ascertain or to inquire as to the observance or
performance of any of the agreements contained in, or conditions of, this
Agreement or any other Loan Document, or to inspect the properties, books or
records of the Borrower.

 

10.4.        Reliance
by Agents.  Each Agent shall be entitled to rely, and
shall be fully protected in relying, upon any Note, writing, resolution,
notice, consent, certificate, affidavit, letter, telecopy, telex or teletype
message, statement, order or other document or conversation believed by it to
be genuine and correct and to have been signed, sent or made by the proper
Person or Persons and upon advice and statements of legal counsel (including,
without limitation, counsel to the Borrower), independent accountants and other
experts selected by such Agent with reasonable care.  Each Agent may deem and treat the Person
whose name is recorded in the Register pursuant to the terms hereof as the
owner thereof for all purposes unless a written notice of assignment,
negotiation or transfer thereof shall have been filed with the Administrative
Agent.  Each Agent shall be fully
justified in failing or refusing to take any action under this Agreement or any
other Loan Document unless it shall first receive such advice or concurrence of
the Majority Lenders (or, to the extent provided in subsection 11.1, all of the
Lenders) as it deems appropriate or it shall first be indemnified to its
satisfaction by the Lenders against any and all liability and expense which may
be incurred by it by reason of taking or continuing to take any such action.  Each Agent shall in all cases be fully
protected in acting, or in refraining from acting, under this Agreement and the
other Loan Documents in accordance with a request of the Majority Lenders (or,
to the extent provided in subsection 11.1, all of the Lenders), and

 

81

 

such request and any action taken or failure
to act pursuant thereto shall be binding upon all the Lenders and all future
holders of the Loans.

 

10.5.        Notice
of Default.  No Agent shall be deemed to have knowledge or
notice of the occurrence of any Default or Event of Default hereunder unless
the Administrative Agent has received notice from a Lender or the Borrower
referring to this Agreement, describing such Default or Event of Default and
stating that such notice is a “notice of default” (and, in the case of the
Collateral Agent and the Syndication Agent, shall have received notice thereof
as described in the following sentence). 
In the event that the Administrative Agent receives such a notice, the
Administrative Agent shall give notice thereof to the other Agents and
Lenders.  The Administrative Agent shall
take such action with respect to such Default or Event of Default as shall be
reasonably directed by the Majority Lenders; provided that unless and
until the Administrative Agent shall have received such directions, the
Administrative Agent may (but shall not be obligated to) take such action, or
refrain from taking such action, with respect to such Default or Event of
Default as it shall deem advisable in the best interests of the Lenders.

 

10.6.        Non-Reliance
on Agents and Other Lenders.  Each Lender expressly acknowledges that no
Agent or any Agent’s officers, directors, employees, agents, attorneys-in-fact
or Affiliates has made any representations or warranties to it and that no act
by any Agent hereafter taken, including any review of the affairs of the
Borrower, shall be deemed to constitute any representation or warranty by any
Agent to any Lender.  Each Lender
represents to each Agent that it has, independently and without reliance upon
any Agent or any other Lender, and based on such documents and information as
it has deemed appropriate, made its own appraisal of and investigation into the
business, operations, property, financial and other condition and
creditworthiness of the Borrower and into the Transactions, and made its own
decision to make its Loans hereunder and enter into this Agreement.  Each Lender also represents that it will,
independently and without reliance upon the Agents, the Arranger or any other
Lender, and based on such documents and information as it shall deem
appropriate at the time, continue to make its own credit analysis, appraisals
and decisions in taking or not taking action under this Agreement and the other
Loan Documents, and to make such investigation as it deems necessary to inform
itself as to the business, operations, property, financial and other condition
and creditworthiness of the Borrower. 
Except for notices, reports and other documents expressly required to be
furnished to the Lenders by the Administrative Agent, the Collateral Agent or
the Syndication Agent hereunder, no Agent shall have any duty or responsibility
to provide any Lender with any credit or other information concerning the
business, operations, property, condition (financial or otherwise), prospects
or creditworthiness of the Borrower which may come into the possession of such
Agent or any of its officers, directors, employees, agents, attorneys-in-fact
or Affiliates.

 

10.7.        Indemnification.  The
Lenders agree to indemnify each Agent in its capacity as such (to the extent
not reimbursed by the Borrower and without limiting the obligation of the
Borrower to do so), ratably according to their respective Total Loan
Percentages in effect on the date on which indemnification is sought (or, if
indemnification is sought after the date upon which the Commitments shall have
terminated and the Loans shall have been paid in full, ratably

 

82

 

in accordance with their Total Loan
Percentages immediately prior to such date), from and against any and all
liabilities, obligations, losses, damages, penalties, actions, judgments,
suits, costs, expenses or disbursements of any kind whatsoever which may at any
time (including, without limitation, at any time following the payment of the
Loans) be imposed on, incurred by or asserted against such Agent in any way
relating to or arising out of the Commitments, this Agreement, any of the other
Loan Documents or any documents contemplated by or referred to herein or
therein or the transactions contemplated hereby or thereby or any action taken
or omitted by such Agent under or in connection with any of the foregoing; provided
that no Lender shall be liable for the payment of any portion of such
liabilities, obligations, losses, damages, penalties, actions, judgments,
suits, costs, expenses or disbursements resulting solely from such Agent’s
gross negligence or willful misconduct. 
The agreements in this subsection 10.7 shall survive the payment of the
Loans and all other amounts payable hereunder.

 

10.8.        Agent
in Its Individual Capacity.  The entity which is an Agent and its
Affiliates may make loans to, accept deposits from and generally engage in any
kind of business with the Borrower as though the entity which is such Agent
were not such Agent hereunder and under the other Loan Documents.  With respect to the Loans made by it, such
entity shall have the same rights and powers under this Agreement and the other
Loan Documents as any Lender and may exercise the same as though it were not an
Agent, and the terms “Lender” and “Lenders” shall include the entity which is
such Agent in its individual capacity.

 

10.9.        Successor Agents.  Any
Agent may resign as Agent upon 45 days’ notice to the Lenders.  If any Agent shall resign as Agent under this
Agreement and the other Loan Documents, then the Majority Lenders shall appoint
from among the Lenders a successor agent for the Lenders, which successor agent
shall be approved by the Borrower (except during the occurrence and
continuation of an Event of Default), such approval not to be unreasonably
withheld, whereupon such successor agent shall succeed to the rights, powers
and duties of such Agent, and the term “Administrative Agent,” “Collateral
Agent” or “Syndication Agent,” as the case may be, shall mean such successor
agent effective upon such appointment and approval, and the former Agent’s
rights, powers and duties as Agent shall be terminated, without any other or
further act or deed on the part of such former Agent or any of the parties to
this Agreement or any holders of the Loans. 
After any retiring Agent’s resignation as Agent, the provisions of this
Section 10 shall inure to its benefit as to any actions taken or omitted to be
taken by it while it was Agent under this Agreement and the other Loan
Documents.

 

10.10.      Issuing
Lender.  Each Lender hereby acknowledges that the
provisions of this Section 10 shall apply to the Issuing Lender, in its
capacity as issuer of any Letter of Credit, in the same manner as such
provisions are expressly stated to apply to the Agents.

 

SECTION 11.  MISCELLANEOUS

 

11.1.        Amendments
and Waivers.  Neither this Agreement nor any other Loan
Document, nor any terms hereof or thereof, may be amended, supplemented, waived
or modified except in accordance with the provisions of this subsection
11.1.  The Majority Lenders may, or,

 

83

 

with the written consent of the Majority
Lenders, the Administrative Agent may, from time to time, (i) enter into
with the applicable Loan Parties written amendments, supplements or
modifications hereto and to the other Loan Documents for the purpose of adding
any provisions to this Agreement or the other Loan Documents or changing in any
manner the rights or obligations of the Lenders or of the Borrower or of any
other Loan Party hereunder or thereunder or (ii) waive at the Borrower’s
request, on such terms and conditions as the Majority Lenders or the
Administrative Agent, as the case may be, may specify in such instrument, any
of the requirements of this Agreement or the other Loan Documents or any
Default or Event of Default and its consequences; provided, however,
that no such waiver and no such amendment, supplement or modification shall:

 

(i)            increase the Commitment of any Lender without
the written consent of such Lender,

 

(ii)           reduce the principal amount of any Loan or
Reimbursement Obligation or reduce the rate of interest thereon or require any
Lender to offer Interest Periods of longer than six months without regard to
availability, or reduce any fees payable hereunder, without the written consent
of each Lender affected thereby,

 

(iii)          postpone the scheduled date of payment of the
principal amount of any Loan or Reimbursement Obligation, or any interest
thereon, or any fees payable hereunder, or reduce the amount of, waive or
excuse any such payment, or postpone the scheduled date of expiration of any
Commitment, without the written consent of each Lender affected thereby,

 

(iv)          change subsection 4.8 in a manner that would
alter the pro rata sharing of payments required thereby, without the written
consent of each Lender affected thereby (it being understood that if additional
Classes of Term Loans or additional Loans under this Agreement consented to by
the Majority Lenders or additional Loans pursuant to subsection 2.9 are
made, such new Loans being included on a pro
rata basis within subsection 4.8 shall not be considered an
alteration thereof),

 

(v)           release the Guarantee and Collateral
Agreement or all or a substantial portion of the Collateral under, and as
defined in, the Security Documents or any Guarantor under, and as defined in,
the Guarantee and Collateral Agreement, without the written consent of each
Lender,

 

(vi)          change any of the provisions of this
subsection 11.1 or the definition of “Majority Lenders” or any other provision
hereof specifying the number or percentage of Lenders required to waive, amend
or modify any rights hereunder or make any determination or grant any consent
hereunder, without the written consent of each Lender (it being understood that
if additional Classes of Term Loans or additional Loans under this Agreement
consented to by the Majority Lenders or additional Loans pursuant to subsection
2.9

 

84

 

are
made, such new Loans being included in the definition of “Majority Lenders”
shall not be considered an alteration thereof),

 

(vii)         amend or waive the mandatory prepayment
provisions of subsection 4.4 without the written consent of Lenders holding a
majority of the Term A Loans, the Term C Loans or the Aggregate Revolving
Credit Commitments, in each case to the extent the Lenders in such Class are
adversely affected thereby, or

 

(viii)        amend or waive any provisions of this
Agreement or any other Loan Document for purposes of determining whether the
conditions precedent set forth in subsection 6.2 to the making of any Revolving
Credit Loan have been satisfied without the written consent of the Lenders holding
a majority in interest of the Aggregate Revolving Credit Commitments.

 

In
addition to the foregoing, (x) no such amendment, supplement or
modification shall amend, modify or otherwise affect the rights or duties of
any Agent, the Issuing Bank or the Swing Line Lender hereunder without the
prior written consent of such Agent, the Issuing Bank or the Swing Line Lender,
as the case may be, and (y) no such amendment, supplement, modification or
waiver shall amend, modify or otherwise affect subsection 8.1 at a time when a
Default or Event of Default shall have occurred and be continuing unless the
Lenders holding a majority in interest of the Aggregate Revolving Credit
Commitments shall have consented in writing to such amendment, modification or
waiver.  Any waiver and any amendment,
supplement or modification pursuant to this subsection 11.1 shall apply to each
of the Lenders and shall be binding upon the Borrower, the applicable other
Loan Parties, the Lenders, the Agents and all future holders of the Loans and
the Reimbursement Obligations.  In the
case of any waiver, the Borrower, the Lenders and the Agents shall be restored
to their former positions and rights hereunder and under the other Loan
Documents, and any Default or Event of Default waived shall be deemed to be
cured and not continuing; but no such waiver shall extend to any subsequent or
other Default or Event of Default, or impair any right consequent thereon.

 

11.2.        Notices.  All
notices, requests and demands to or upon the respective parties hereto to be
effective shall be in writing (including by facsimile transmission) and, unless
otherwise expressly provided herein, shall be deemed to have been duly given or
made (a) in the case of delivery by hand, when delivered, (b) in the case of delivery
by mail, three days after being deposited in the mails, postage prepaid, or (c)
in the case of delivery by facsimile transmission, when sent and receipt has
been confirmed, addressed as follows in the case of the Borrower, the Issuing
Lender and the Administrative Agent, and as set forth in Schedule I in
the case of the other parties hereto, or to such other address as may be
hereafter notified in writing by the respective parties hereto:

 

85

 

	
  The
  Borrower:

  	
  c/o
  NBTY, Inc.

  
	
   

  	
  90
  Orville Drive

  
	
   

  	
  Bohemia,
  New York 11716-2510

  
	
   

  	
  Attention:
  President

  
	
   

  	
  Fax:
  (631) 567-7148

  
	
   

  	
   

  
	
  The
  Administrative

  	
   

  
	
  Agent,
  the Collateral

  	
   

  
	
  Agent,
  the Issuing

  	
   

  
	
  Lender
  or Swing Line

  	
   

  
	
  Lender:

  	
  JPMorgan
  Chase Bank, N.A.

  
	
   

  	
  395
  North Service Road

  
	
   

  	
  Melville,
  New York 11747

  
	
   

  	
  Attention:
  William A. DeMilt, Jr.

  
	
   

  	
  Fax:
  (631) 755-5184

  
	
   

  	
   

  
	
  With
  a copy to:

  	
  JPMorgan
  Chase Bank, N.A.

  
	
   

  	
  Loan
  and Agency Services Group

  
	
   

  	
  1111
  Fannin, 10th Floor

  
	
   

  	
  Houston,
  Texas 77002

  
	
   

  	
  Attention:
  Glen Hector

  
	
   

  	
  Fax:
  (713) 750-2938

  
	
   

  	
   

  
	
  and

  	
  Cahill
  Gordon & Reindel LLP

  
	
   

  	
  80
  Pine Street

  
	
   

  	
  New
  York, New York 10005

  
	
   

  	
  Attention:
  Michael A. Becker, Esq.

  
	
   

  	
  Fax:
  (212) 269-5420

  
	
   

  	
   

  
	
  The
  Syndication

  Agent:

  	
  Bank
  of America, N.A.

  
	
   

  	
  Global
  Corporate & Investment Banking

  
	
   

  	
  231
  S. LaSalle Street, 10th Floor

  
	
   

  	
  Chicago,
  IL 60697

  
	
   

  	
  Attention:
  David L. Catherall

  
	
   

  	
  Fax:
  (415) 503-5026

  

 

provided that any notice, request or demand to or
upon any Agent, the Issuing Lender or the Lenders pursuant to subsection 2.2,
2.4, 2.5, 2.7, 3.2 or 4.2 shall not be effective until received.

 

11.3.        No
Waiver; Cumulative Remedies.  No failure to exercise and no delay in
exercising, on the part of any Agent or any Lender, any right, remedy, power or
privilege hereunder or under the other Loan Documents shall operate as a waiver
thereof; nor shall any single or partial exercise of any right, remedy, power
or privilege hereunder preclude any other or further exercise thereof or the
exercise of any other right, remedy, power or privilege.  The rights,

 

86

 

remedies, powers and privileges herein
provided are cumulative and not exclusive of any rights, remedies, powers and
privileges provided by law.

 

11.4.        Survival.  All
representations and warranties made hereunder, in the other Loan Documents and
in any document, certificate or statement delivered pursuant hereto or in
connection herewith shall survive the execution and delivery of this Agreement
and the making of the Loans hereunder until all obligations hereunder and under
the other Loan Documents have been paid in full and the Commitments hereunder
have been terminated.  The agreements in
subsection 4.12 shall survive the termination of this Agreement and the payment
of the Notes and all other amounts payable hereunder until the expiration of
the applicable statute of limitations for such taxes.  The rights of the lenders in respect of the
Prior Term A Loans under the Existing Credit Agreement shall survive in
accordance with subsection 11.4 of the Existing Credit Agreement.

 

11.5.        Payment
of Expenses and Taxes.  The Borrower agrees (a) to pay or reimburse
the Administrative Agent for all its reasonable out-of-pocket costs and
expenses incurred in connection with the development, preparation, syndication
and execution of, and any amendment, supplement or modification to, this
Agreement and the other Loan Documents and any other documents prepared in
connection herewith or therewith, and the consummation and administration of
the transactions contemplated hereby and thereby, including, without
limitation, the reasonable fees and disbursements of New York counsel to the
Administrative Agent, (b) to pay or reimburse each Lender and any Agent for all
its costs and expenses incurred during the continuance of any Default or Event
of Default in connection with the enforcement or preservation of any rights
under this Agreement, the other Loan Documents and any such other documents,
including, without limitation, the fees and disbursements of counsel to each
Lender and of counsel to the Agents, (c) to pay, indemnify, and hold harmless
each Lender and the Agent from, any and all recording and filing fees and any
and all liabilities with respect to, or resulting from any delay in paying,
Other Taxes, if any, which may be payable or determined to be payable in
connection with the execution and delivery of, or consummation or
administration of any of the transactions contemplated by, or any amendment,
supplement or modification of, or any waiver or consent under or in respect of,
this Agreement, the other Loan Documents and any such other documents, and (d)
to pay, indemnify, and hold harmless each Lender and the Administrative Agent
from and against any and all other liabilities, obligations, losses, damages,
penalties, actions, judgments, suits, costs, expenses or disbursements of any
kind or nature whatsoever with respect to the execution, delivery, enforcement,
performance and administration of this Agreement, the other Loan Documents and
related documents or the use of the proceeds of the Loans, including, without
limitation, any of the foregoing relating to the violation of, noncompliance
with or liability under, any Environmental Law applicable to the operations of
the Borrower, any of its Subsidiaries or any of the Properties (all the
foregoing in this clause (d), collectively, the “indemnified liabilities”),
provided that the Borrower shall have no obligation hereunder to the
Administrative Agent or any Lender with respect to indemnified liabilities
solely arising from the gross negligence or willful misconduct of the Agents or
any such Lender, as the case may be.

 

87

 

The agreements in this subsection shall
survive the termination of this Agreement and the repayment of the Loans and all
other amounts payable hereunder.

 

11.6.        Successors and Assigns; Participation and
Assignments.

 

(a)           This Agreement shall be binding upon and
inure to the benefit of the Borrower, the Lenders, the Agents and their
respective successors and assigns permitted hereby (including any Affiliate of
the Issuing Lender that issues any Letter of Credit), except that (i) the
Borrower may not assign or transfer any of its rights or obligations under this
Agreement without the prior written consent of each Lender (and any attempted
assignment or transfer by the Borrower without such consent shall be null and
void) and (ii) no Lender may assign or otherwise transfer its rights or
obligations hereunder except in accordance with this subsection 11.6.  Nothing in this Agreement, express or
implied, shall be construed to confer upon any Person (other than the parties
hereto, their respective successors and assigns permitted hereby (including any
Affiliate of the Issuing Lender that issues any Letter of Credit), Participants
(to the extent provided in paragraph (c) of this subsection 11.6) and, to the
extent expressly contemplated hereby, the Related Parties of each of the
Agents, the Issuing Bank and the Lenders) any legal or equitable right, remedy
or claim under or by reason of this Agreement.

 

(b)           (i) 
Subject to the conditions set forth in clause (ii) below, any
Lender may assign to one or more assignees all or a portion of its rights and
obligations under this Agreement (including all or a portion of its Commitment
and the Loans at the time owing to it) with the prior written consent (such
consent not to be unreasonably withheld, delayed or conditioned) of:

 

(A)          the Borrower, provided that no
consent of the Borrower shall be required at any time for an assignment to a
Lender, an Affiliate of a Lender or an Approved Fund, or for any assignment to
any assignee prior to completion of primary syndication of the Loans and
Commitments hereunder (as determined by JPMorgan Chase in its sole discretion)
or if a Default or Event of Default has occurred and is continuing; and

 

(B)           the Administrative Agent, provided
that no consent of the Administrative Agent shall be required for an assignment
of (x) any Revolving Credit Commitment to an assignee that is a Lender
with a Revolving Credit Commitment immediately prior to giving effect to such
assignment or an Affiliate of such Lender or (y) all or any portion of a
Term Loan to a Lender, an Affiliate of a Lender or an Approved Fund.

 

(ii)           Assignments shall be subject to the
following additional conditions:

 

(A)          except in the case of an assignment to a
Lender or an Affiliate of a Lender or an assignment of the entire remaining
amount of the assigning Lender’s Commitment or Loans of any Class, the amount
of the Commitment or Loans of the assigning Lender subject to each such
assignment (determined as of the date the Assignment and Acceptance with
respect to such assignment is delivered to the Administrative Agent) shall not
be less than $5,000,000 or, in the case of a Term Loan, $1,000,000 unless each
of the

 

88

 

Borrower and the
Administrative Agent otherwise consents, provided that no such consent
of the Borrower shall be required prior to completion of primary syndication of
the Loans and Commitments hereunder (as determined by JPMorgan Chase in its
sole discretion) or if a Default or Event of Default has occurred and is
continuing;

 

(B)           each partial assignment shall be made as
an assignment of a proportionate part of all the assigning Lender’s rights and
obligations under this Agreement, provided that this clause shall not be
construed to prohibit the assignment of a proportionate part of all the
assigning Lender’s rights and obligations in respect of one Class of
Commitments or Loans;

 

(C)           the parties to each assignment shall
execute and deliver to the Administrative Agent an Assignment and Acceptance,
together with a processing and recordation fee of $3,500, provided that
only one such fee shall be payable in the event of simultaneous assignments by
a Lender to or from two or more Approved Funds; and

 

(D)          the assignee, if it shall not be a
Lender, shall deliver to the Administrative Agent a completed Administrative
Questionnaire.

 

For
purposes of the minimum assignment sizes set forth in subsection
11.6(b)(ii)(A), simultaneous assignments to Approved Funds under common
management by a Lender shall be aggregated, provided that any such individual
assignment shall not be less than $500,000. 
For the purposes of this subsection 11.6(b), the term “Approved
Fund” has the following meaning:

 

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

 

(iii)          Subject to acceptance and recording
thereof pursuant to paragraph (b)(iv) of this subsection, from and after
the effective date specified in each Assignment and Assumption the assignee
thereunder (“Assignee”) shall be a party hereto and, to the extent of
the interest assigned by such Assignment and Assumption, have the rights and
obligations of a Lender under this Agreement, and the assigning Lender
thereunder shall, to the extent of the interest assigned by such Assignment and
Assumption, be released from its obligations under this Agreement (and, in the
case of an Assignment and Assumption covering all of the assigning Lender’s
rights and obligations under this Agreement, such Lender shall cease to be a
party hereto).  Any assignment or
transfer by a Lender of rights or obligations under this Agreement that does
not comply with this subsection 11.6 shall be treated for purposes of this
Agreement as a sale by such Lender of a participation in such rights and
obligations in accordance with paragraph (c) of this subsection.

 

89

 

(iv)          The Administrative Agent, acting for this
purpose as an agent of the Borrower, shall maintain at one of its offices a
copy of each Assignment and Assumption delivered to it and a register for the
recordation of the names and addresses of the Lenders, and the Commitment of, and
principal amount of the Loans and Letter of Credit disbursements owing to, each
Lender pursuant to the terms hereof from time to time (the “Register”).  The entries in the Register shall be
conclusive, and the Borrower, the Agents, the Issuing Bank and the Lenders may
treat each Person whose name is recorded in the Register pursuant to the terms
hereof as a Lender hereunder for all purposes of this Agreement,
notwithstanding notice to the contrary. 
The Register shall be available for inspection by the Borrower, the
Issuing Bank and any Lender, at any reasonable time and from time to time upon
reasonable prior notice.

 

(v)           Upon its receipt of a duly completed
Assignment and Assumption executed by an assigning Lender and an Assignee, the
Assignee’s completed Administrative Questionnaire (unless the Assignee shall
already be a Lender hereunder), the processing and recordation fee referred to
in paragraph (b) of this subsection and any written consent to such assignment
required by paragraph (b) of this subsection, the Administrative Agent shall
accept such Assignment and Assumption and record the information contained
therein in the Register.  No assignment
shall be effective for purposes of this Agreement unless it has been recorded
in the Register as provided in this paragraph.

 

(c)           (i) 
Any Lender may, without the consent of the Borrower, the Administrative
Agent, the Issuing Bank or the Swing Line Lender, sell participations to one or
more banks or other entities (a “Participant”) in all or a portion of such
Lender’s rights and obligations under this Agreement (including all or a
portion of its Commitment and the Loans owing to it); provided that
(A) such Lender’s obligations under this Agreement shall remain unchanged,
(B) such Lender shall remain solely responsible to the other parties
hereto for the performance of such obligations and (C) the Borrower, the
Administrative Agent, the Issuing Bank and the other Lenders shall continue to
deal solely and directly with such Lender in connection with such Lender’s
rights and obligations under this Agreement. 
Any agreement or instrument pursuant to which a Lender sells such a
participation shall provide that such Lender shall retain the sole right to
enforce this Agreement and to approve any amendment, modification or waiver of
any provision of this Agreement; provided that such agreement or
instrument may provide that such Lender will not, without the consent of the
Participant, agree to any amendment, modification or waiver described in
clauses (ii), (iii) and (v) of subsection 11.1 that affects such
Participant.  Subject to paragraph
(c)(ii) of this subsection, the Borrower agrees that each Participant
shall be entitled to the benefits of subsections 4.10, 4.11 and 4.12 to the
same extent as if it were a Lender and had acquired its interest by assignment
pursuant to paragraph (b) of this subsection. 
To the extent permitted by law, each Participant also shall be entitled
to the benefits of subsection 11.7 as though it were a Lender, provided that such Participant agrees to be
subject to subsection 4.8 as though it were a Lender.

 

(ii)           A Participant shall not be entitled to
receive any greater payment under subsections 4.10 or 4.12 than the
applicable Lender would have been entitled to receive with

 

90

 

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.  A Participant that would be a
Foreign Lender if it were a Lender shall not be entitled to the benefits of
subsection 4.12 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 subsection 4.12(e) as though it were a Lender.

 

(d)           Any Lender may at any time pledge or assign a
security interest in all or any portion of its rights under this Agreement to
secure obligations of such Lender, including without limitation any pledge or
assignment to secure obligations to a Federal Reserve Bank, and this subsection
shall not apply to any such pledge or assignment of a security interest; provided
that no such pledge or assignment of a security interest shall release a Lender
from any of its obligations hereunder or substitute any such pledgee or
assignee for such Lender as a party hereto.

 

11.7.        Adjustments; Set-off.

 

(a)           If any Lender (a “Benefited Lender”)
shall at any time receive any payment of all or part of its Loans owing to it
by the Borrower, or interest thereon, or receive any collateral in respect
thereof (whether voluntarily or involuntarily, by set-off, pursuant to events
or proceedings of the nature referred to in clause (h) of Section 9 or
otherwise, except for payments pursuant to the operation of subsections 4.14(b)
or 11.6), in a greater proportion than any such payment to or collateral
received by any other Lender, if any, in respect of such other Lender’s Loans
owing to it by the Borrower, or interest thereon, such Benefited Lender shall
purchase for cash from the other Lenders a participating interest in such
portion of each such other Lender’s Loan owing to it by the Borrower, or shall
provide such other Lenders with the benefits of any such collateral, or the
proceeds thereof, as shall be necessary to cause such Benefited Lender to share
the excess payment or benefits of such collateral or proceeds ratably with each
of the Lenders; provided, however, that if all or any portion of
such excess payment or benefits is thereafter recovered from such Benefited Lender,
such purchase shall be rescinded, and the purchase price and benefits returned,
to the extent of such recovery, but without interest.

 

(b)           In addition to any rights and remedies of the
Lenders provided by law, each Lender shall have the right, without prior notice
to the Borrower, any such notice being expressly waived by the Borrower to the
extent permitted by applicable law, upon any amount becoming due and payable by
the Borrower hereunder (whether at the stated maturity, by acceleration or otherwise)
to set off and appropriate and apply against such amount any and all deposits
(general or special, time or demand, provisional or final), in any currency,
and any other credits, indebtedness or claims, in any currency, in each case
whether direct or indirect, absolute or contingent, matured or unmatured, at
any time held or owing by such Lender or any branch or agency thereof to or for
the credit or the account of the Borrower. 
Each Lender agrees promptly to notify the Borrower and the
Administrative Agent after any such set-off and application made by such
Lender, provided that the failure to give such notice shall not affect
the validity of such set-off and application.

 

91

 

11.8.        Counterparts.  This Agreement may be executed by one or more
of the parties to this Agreement on any number of separate counterparts
(including by facsimile transmission), and all of said counterparts taken
together shall be deemed to constitute one and the same instrument.  A set of the copies of this Agreement signed
by all the parties shall be delivered to the Borrower and the Administrative
Agent.

 

11.9.        Severability.  Any
provision of this Agreement which is prohibited or unenforceable in any
jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions hereof, and any
such prohibition or unenforceability in any jurisdiction shall not invalidate
or render unenforceable such provision in any other jurisdiction.

 

11.10.      Integration.  This Agreement and the other Loan Documents
represent the entire agreement of the Borrower, the Agents and the Lenders with
respect to the subject matter hereof and thereof, and there are no promises, undertakings,
representations or warranties by the Borrower, any Agent or any Lender relative
to the subject matter hereof or thereof not expressly set forth or referred to
herein or in the other Loan Documents. 
Any reference in any Loan Document to Term A Loans (and any
corresponding terms) shall be deemed to be a reference to the Term A Loans made
on the Effective Date (and not on the Closing Date).  Any reference in any Loan Document to Term B
Loans (and any corresponding terms) shall be deemed to be a reference to Term C
Loans.  Any reference in any Loan
Document to the Existing Credit Agreement shall mean and be a reference to this
Agreement.

 

11.11.      GOVERNING LAW.  THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS
OF THE PARTIES UNDER THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED AND
INTERPRETED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.

 

11.12.      Submission
to Jurisdiction; Waivers.  The Borrower hereby irrevocably and
unconditionally:

 

(i)            submits for itself and its property in any
legal action or proceeding relating to this Agreement or any other Loan
Document to which it is a party, or for recognition and enforcement of any
judgment in respect thereof, to the non-exclusive general jurisdiction of the
courts of the State of New York, the courts of the United States of America for
the Southern District of New York, and appellate courts from any thereof;

 

(ii)           consents that any such action or proceeding
may be brought in such courts and waives any objection that it may now or
hereafter have to the venue of any such action or proceeding in any such court
or that such action or proceeding was brought in an inconvenient court and
agrees not to plead or claim the same;

 

(iii)          agrees that service of process in any such
action or proceeding may be effected by mailing a copy thereof by registered or
certified mail (or any substantially similar

 

92

 

form
of mail), postage prepaid, to the Borrower at its address set forth in
subsection 11.2 or at such other address of which the Administrative Agent
shall have been notified pursuant thereto; and

 

(iv)          agrees that nothing herein shall affect the
right to effect service of process in any other manner permitted by law or
shall limit the right to sue in any other jurisdiction.

 

11.13.      Acknowledgements.  The
Borrower hereby acknowledges that:

 

(a)           it has been advised by counsel in the
negotiation, execution and delivery of this Agreement and the other Loan
Documents;

 

(b)           none of the Administrative Agent or any
Lender has any fiduciary relationship with or duty to the Borrower arising out
of or in connection with this Agreement or any of the other Loan Documents, and
the relationship between the Administrative Agents and the Lenders, on the one
hand, and the Borrower, on the other hand, in connection herewith or therewith
is solely that of debtor and creditor; and

 

(c)           no joint venture is created hereby or by
the other Loan Documents or otherwise exists by virtue of the transactions
contemplated hereby among the Lenders or among the Borrower and the Lenders.

 

11.14.      WAIVERS OF JURY TRIAL.  EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY
AND UNCONDITIONALLY WAIVES TRIAL BY JURY IN ANY LEGAL ACTION OR PROCEEDING
RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT AND FOR ANY COUNTERCLAIM
THEREIN.

 

11.15.      Confidentiality.  Each
Agent and Lender and the Issuing Lender agrees to take normal and reasonable
precautions to maintain the confidentiality of information provided to it by
the Borrower or any Subsidiary in connection with this Agreement (and, if
delivered after the date of this Agreement, designated in writing as
confidential); provided, however, that any such Person may
disclose such information (a) at the request of any regulatory authority
having supervisory jurisdiction over it or in connection with an examination of
such Person by any such authority or the request of any rating agency requiring
access to a Lender’s portfolio, (b) pursuant to subpoena or other court
process, (c) when required to do so in accordance with the provisions of any
applicable law, (d) at the direction of any other Governmental Authority, (e)
to such Person’s Affiliates, independent auditors and other professional
advisors (it being understood that the Persons to whom such disclosure is made
will be informed of the confidential nature of such information and instructed
to keep such information confidential), (f) which has become generally
available to the public, other than as a result of a disclosure by such Person
or agent of such Person or a disclosure known to such Person or agent of such
Person to have been made by any person or entity to which such Person or agent
has delivered such confidential information, (g) which becomes available to
such Person from a source other than the Borrower or any Subsidiary

 

93

 

(provided that such source is not
known to such Person to be bound by a duty of confidentiality to the Borrower
or any Subsidiary) or (h) to any Participant or Assignee or potential Participant
or Assignee (each, a “Transferee”) or any pledgee (or prospective
pledgee) (each, a “Pledgee”) of any Lender that is a Person (other than
a natural person) that is engaged in making, purchasing, holding or investing
in bank loans and similar extensions of credit in the ordinary course of its
business; provided that such Transferee or Pledgee agrees in writing to
comply with the provisions of this subsection 11.15.

 

11.16.      Designation
of Senior Indebtedness.  The Indebtedness of the Borrower under this
Agreement shall constitute “Designated Senior Indebtedness” pursuant to, for
all purposes of, and under and as defined in, the Existing Notes Indenture.

 

11.17.      USA
PATRIOT ACT.  Each Lender hereby notifies the Borrower that
pursuant to the requirements of the USA Patriot Act (Title III of Pub. L.
107-56 (signed into law October 26, 2001)) (the “Patriot Act”), it is
required to obtain, verify and record information that identifies the Borrower,
which information includes the name and address of the Borrower and other
information that will allow such Lender to identify the Borrower in accordance
with the Patriot Act.

 

94

 

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

 

 

	
   

  	
  NBTY, INC.

  
	
   

  	
  By:
  

  	
      /s/
  Harvey Kamil

  	
   

  
	
   

  	
   

  	
  Name:
  Harvey Kamil

  
	
   

  	
   

  	
  Title:
    President

  

 

S-1

 

	
   

  	
  JPMORGAN CHASE BANK, N.A.

  	
   

  
	
   

  	
   

  	
  as Administrative Agent and Collateral Agent

  and as a Lender, and as Swing Line Lender, and

  as Issuing Lender

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
      /s/ Stephen Zajac

  	
   

  
	
   

  	
   

  	
  Name: 

  	
  Stephen Zajac

  	
   

  
	
   

  	
   

  	
  Title: 

  	
  Vice President

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  BANK OF AMERICA, N.A.,

  
	
   

  	
   

  	
  As Syndication Agent and as a Lender

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
      /s/ David L. Catherall

  	
   

  
	
   

  	
   

  	
  Name: 

  	
  David L. Catherall

  	
   

  
	
   

  	
   

  	
  Title: 

  	
  Vice President 

  	
   

  
							

 

 

	
   

  	
   

  	
  Accepted and Agreed:

  	
   

  
	
   

  	
   

  	
  [LENDER]

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  	
   

  	
   

  
	
   

  	
   

  	
  Title:

  	
   

  	
   

  
						

 

2

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