Document:

exv10w1

 

Exhibit 10.1

LIMITED WAIVER OF LOAN AND SECURITY AGREEMENT

     THIS LIMITED WAIVER OF LOAN AND SECURITY AGREEMENT (this “Agreement”), dated as of
September 25, 2006 (the “Waiver Date”), is among Amkor Technology, Inc. and its
Subsidiaries party hereto, the Lenders party to the Loan and Security Agreement referred to below,
and Bank of America, N.A., as administrative agent for the Lenders (the “Agent”).

RECITALS:

     WHEREAS, The Borrowers, the Lenders, and the Agent have entered into that certain Loan and
Security Agreement, dated as of November 28, 2005 (as amended, the “Loan and Security
Agreement”); and

     WHEREAS, the Borrower has advised the Lenders that a default may have occurred and exist under
its Material Contracts as more fully set forth in the Consent Solicitation Statements, dated
September 14, 2006 (as may be amended, supplemented or replaced, the “Consent
Solicitations”), soliciting consents to certain “Proposed Waivers” from the holders of certain
of Amkor’s senior notes, senior subordinated notes, convertible senior subordinated notes and
convertible subordinated notes constituting Material Contracts as a result of Amkor’s failure to
file with the Securities and Exchange Commission (the “SEC”) prior to the applicable
deadline specified in the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and to
deliver to the applicable trustee and the holders of such notes a copy of, any report or other
information as it would be required to file with the SEC under Section 13(a) or 15(d) of the
Exchange Act (including, without limitation, its quarterly report on Form 10-Q for the quarterly
period ended June 30, 2006 (the “Form 10-Q”) and any related notices or reports
(collectively, the “SEC Reports”); and

     WHEREAS, one of the representations of the Borrowers in Section 9 of the Loan and Security
Agreement (specifically Section 9.1.18 thereof) is that no default exists under any Material
Contract; and

     WHEREAS, Section 6.2 of the Loan and Security Agreement provides that it is a condition
precedent (among others) to the funding of any Revolving Loans, the issuance of any Letters of
Credit or grant of any other accommodation to or for the benefit of the Borrowers that all of the
representations and warranties of each Obligor in the Loan Documents shall be true and correct on
the date of, and upon the giving effect to, such funding, issuance or grant (the “Condition
Precedent”); and

     WHEREAS, the Borrowers have requested that the Lenders agree to waive the Condition Precedent
to permit current credit extensions under the Loan and Security Agreement to the limited extent
specifically provided hereinbelow; and

     WHEREAS, subject to satisfaction of the conditions set forth herein, the Requisite Lenders are
willing to waive to the limited extent set forth herein the Condition Precedent;

LIMITED WAIVER OF LOAN AND SECURITY AGREEMENT – Page 1

 

 

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

ARTICLE 1

Definitions

     Section 1.1 Definitions. Unless otherwise defined in this Agreement, capitalized
terms used in this Agreement shall have the same meanings herein as set forth in the Loan and
Security Agreement.

ARTICLE 2

Limited Waiver of Loan and Security Agreement

     Section 2.1 Waiver. The Lenders waive the Condition Precedent to the extent, and only
to the extent, that such failure to meet all of the conditions precedent to current credit
extensions required by the Loan and Security Agreement results solely from (i) the failure of Amkor
to file with the SEC prior to the applicable deadline specified in the Exchange Act, and provide
copies thereof to the holders of its debt securities (or their representative trustees), the SEC
Reports on or before the “Waiver Expiration Date” (as such term is defined in the Consent
Solicitations) (the “SEC Reporting Waiver”), and (ii) the non-reliance on any financial statements
delivered to the Agent or the Lenders at any time prior to the Waiver Date by reason of the
restatement of Borrowers’ financial statements due to certain accounting errors related to Amkor’s
historical stock option grant practices (the “Restatement Waiver” and together with the SEC
Reporting Waiver, the “Limited Waiver”).

     Section 2.2 Limitation of Waiver. The Limited Waiver granted in Section 2.1
of this Agreement shall be: (i) effective conditioned upon fulfillment of the conditions provided
in Article 3 below; and (ii) limited strictly as written and shall not be deemed to
constitute a waiver of, or any consent to noncompliance with, any term, condition or provision of
the Loan and Security Agreement or any other Loan Document except as expressly set forth herein.
Further, the SEC Reporting Waiver granted in Section 2.1 of this Agreement shall not
constitute a waiver of and shall immediately terminate and expire on the Waiver Expiration Date or
upon the occurrence of any Default or Event of Default. The Restatement Waiver shall remain in
effect from the Waiver Date to and including the Termination Date. The Limited Waiver shall not
constitute a waiver of any rights, remedies, powers or privileges of the Agent or any Lender
arising as a result of any such Default or Event of Default. The Lenders hereby acknowledge that
the failure of Amkor to file the Form 10-Q with the SEC prior to the applicable deadline specified
in the Exchange Act does not constitute a Default.

LIMITED WAIVER OF LOAN AND SECURITY AGREEMENT — Page 2

 

 

ARTICLE 3

Conditions

     Section 3.1 Conditions Precedent. The effectiveness of this Agreement from the date
hereof through October 10, 2006 is subject to the satisfaction of the following conditions
precedent:

     (a) no Default or Event of Default shall be in existence as of the Waiver Date;

     (b) the Agent shall have received a fully executed copy of this Agreement from
Borrowers and the Requisite Lenders;

     (c) Payment by the Borrowers to the Agent of all fees, costs, and expenses owed to
and/or incurred by the Agent in connection with the Loan and Security Agreement or this
Agreement; and

     (d) Payment by the Borrower to the Agent, for the account of each Lender, a fee in
respect of the waiver granted and agreed to herein in the amount of 10 basis points of each
Lender’s Revolving Commitment.

     Section 3.2 Conditions Subsequent. The continuing effectiveness of the SEC Reporting
Waiver for the period from October 10, 2006, through December 31, 2006, is subject, in addition to
each other provision hereof, to payment by the Borrower to the Agent on or before October 10, 2006,
for the account of each Lender, a fee in respect of the continuing waiver granted and agreed to
herein in the amount of 15 basis points of each Lender’s Revolving Commitment, and the continuing
effectiveness of the SEC Reporting Waiver for the period from December 31, 2006, through and
including March 31, 2007, is subject, in addition to each other provision hereof, to payment by the
Borrower to the Agent on or before December 31, 2006, for the account of each Lender, a fee in
respect of the continuing waiver granted and agreed to herein in the amount of 25 basis points of
each Lender’s Revolving Commitment.

ARTICLE 4

Ratifications, Representations, and Warranties

     Section 4.1 Ratifications. The terms and provisions set forth in this Agreement shall
modify and supersede all inconsistent terms and provisions set forth in the Loan and Security
Agreement and the other Loan Documents and, except as expressly waived by this Agreement, the terms
and provisions of the Loan and Security Agreement and the other Loan Documents are ratified and
confirmed and shall continue in full force and effect. The Borrowers, the Agent, and the Lenders
agree that the Loan and Security Agreement and the other Loan Documents shall continue to be legal,
valid, binding, and enforceable in accordance with their respective terms.

     Section 4.2 Borrowers’ Representations and Warranties. The Borrowers hereby represent
and warrant to the Agent and the Lenders that (a) the execution, delivery, and performance of this
Agreement and any and all other Loan Documents executed and/or delivered

LIMITED WAIVER OF LOAN AND SECURITY AGREEMENT — Page 3

 

 

in connection herewith have been authorized by all requisite action on the part of the
Borrowers and will not violate the certificate of incorporation or bylaws of any Borrower or the
terms or provisions of any Material Contract, (b) the representations and warranties of the
Borrowers contained in the Loan and Security Agreement (other than in respect of the absence of any
defaults under Material Contracts to the extent described in the Consent Solicitations and the
non-reliance on any financial statements delivered to the Agent or the Lenders at anytime prior to
the Waiver date, and except to the extent such representations and warranties are not true as a
result of the failure of Amkor to file the SEC Reports with the SEC and provide copies thereof to
the holders of its debt securities (or their representative trustees)), and any other Loan Document
are true and correct on and as of the Waiver Date as though made on and as of the Waiver Date
(except to the extent that such representations and warranties were expressly made only in
reference to a specific date), and (c) no Default or Event of Default has occurred and is
continuing.

ARTICLE 5

Miscellaneous

     Section 5.1 Survival of Representations and Warranties. All representations and
warranties made in this Agreement or any other Loan Document including any Loan Document furnished
in connection with this Agreement shall survive the execution and delivery of this Agreement and
the other Loan Documents, and no investigation by the Agent or any Lender shall affect the
representations and warranties or the right of the Agent or any Lender to rely upon them.

     Section 5.2 Severability. Any provision in this Agreement that is held to be
inoperative, unenforceable, or invalid in any jurisdiction shall, as to that jurisdiction, be
inoperative, unenforceable, or invalid without affecting the remaining provisions in that
jurisdiction or the operation, enforceability, or validity of that provision in any other
jurisdiction, and to this end the provisions of this Agreement are declared to be severable.

     Section 5.3 Release. TO INDUCE THE AGENT AND THE LENDERS TO AGREE TO THE TERMS OF
THIS AGREEMENT, THE BORROWERS REPRESENT AND WARRANT THAT AS OF THE DATE OF THIS AGREEMENT THERE ARE
NO CLAIMS OR OFFSETS AGAINST OR DEFENSES OR COUNTERCLAIMS TO THEIR OBLIGATIONS UNDER THE LOAN AND
SECURITY AGREEMENT AND THE OTHER LOAN DOCUMENTS, AND WAIVE ANY AND ALL SUCH CLAIMS, OFFSETS,
DEFENSES, OR COUNTERCLAIMS, WHETHER KNOWN OR UNKNOWN, ARISING PRIOR TO THE DATE OF THIS AGREEMENT
AND RELEASE AND DISCHARGE THE AGENT AND EACH LENDER, AND ITS RESPECTIVE OFFICERS, DIRECTORS,
EMPLOYEES, AGENTS, SHAREHOLDERS, AFFILIATES, AND ATTORNEYS (COLLECTIVELY THE “RELEASED
PARTIES”) FROM ANY AND ALL OBLIGATIONS, INDEBTEDNESS, LIABILITIES, CLAIMS, RIGHTS, CAUSES OF
ACTION, OR DEMANDS WHATSOEVER, WHETHER KNOWN OR UNKNOWN, SUSPECTED OR UNSUSPECTED, IN LAW OR
EQUITY, WHICH ANY BORROWER NOW HAS OR MAY HAVE AGAINST ANY RELEASED PARTY ARISING PRIOR TO THE DATE
HEREOF

LIMITED WAIVER OF LOAN AND SECURITY AGREEMENT — Page 4

 

 

AND FROM OR IN CONNECTION WITH THE LOAN AND SECURITY AGREEMENT, THE OTHER LOAN DOCUMENTS, OR
THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY.

     Section 5.4 Applicable Law. THIS AGREEMENT SHALL BE GOVERNED BY THE LAWS OF THE STATE
OF NEW YORK, PROVIDED THAT IN THE EVENT ANY COURT DETERMINES THAT NEW YORK LAW DOES NOT
GOVERN THE LAWS OF THE STATE OF TEXAS SHALL GOVERN, IN ANY SUCH CASE WITHOUT GIVING EFFECT TO ANY
CONFLICT OF LAW PRINCIPLES (BUT GIVING EFFECT TO FEDERAL LAWS RELATING TO NATIONAL BANKS).

     Section 5.5 Successors and Assigns. This Agreement is binding upon and shall inure to
the benefit of the Borrowers, the Agent, and the Lenders and their respective successors and
assigns, except the Borrowers may not assign or transfer any of their respective rights or
obligations hereunder without the prior written consent of the Lenders and any assignment by the
Lenders shall be made only in accordance with the terms of the Loan and Security Agreement.

     Section 5.6 Counterparts. This Agreement may be executed in any number of
counterparts, all of which taken together shall constitute one agreement, and any of the parties
hereto may execute this Agreement by signing any such counterpart and a telecopy of any such
executed signature page shall be valid as an original. This Agreement shall be effective when it
has been executed by the Borrowers, the Agent, and the Requisite Lenders.

     Section 5.7 Effect of Limited Waiver. Except to the limited extent expressly set
forth herein, no consent or waiver, express or implied, by the Agent or any Lender to or for any
breach of or deviation from any covenant, condition, or duty by the Borrowers shall be deemed a
consent or waiver to or of any other breach of the same or any other covenant, condition, or duty.
The Borrowers hereby (a) agree that this Agreement shall not limit or diminish the obligations of
the Borrowers under the Loan Documents delivered in connection with the Loan and Security
Agreement, executed or joined in by the Borrowers and delivered to the Agent, (b) reaffirms the
Borrowers’ obligations under each of such Loan Documents, and (c) agrees that each of such Loan
Documents to which the Borrowers are a party remains in full force and effect and is hereby
ratified and confirmed.

     Section 5.8 Further Assurances. The Borrowers shall execute and deliver, or cause to
be executed and delivered, to the Agent such documents and agreements, and shall take or cause to
be taken such actions as the Agent may, from time to time, reasonably request to carry out the
terms of this Agreement and the other Loan Documents.

     Section 5.9 Headings. The headings, captions, and arrangements used in this Agreement
are for convenience only and shall not affect the interpretation of this Agreement.

     Section 5.10 Entire Agreement. THIS AGREEMENT AND ALL OTHER INSTRUMENTS, DOCUMENTS,
AND AGREEMENTS EXECUTED AND DELIVERED IN CONNECTION WITH THIS AGREEMENT EMBODY THE FINAL, ENTIRE
AGREEMENT

LIMITED WAIVER OF LOAN AND SECURITY AGREEMENT — Page 5

 

 

AMONG THE PARTIES HERETO AND SUPERSEDE ANY AND ALL PRIOR COMMITMENTS, AGREEMENTS,
REPRESENTATIONS, AND UNDERSTANDINGS, WHETHER WRITTEN OR ORAL, RELATING TO THIS AGREEMENT, AND MAY
NOT BE CONTRADICTED OR VARIED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS
OR DISCUSSIONS OF THE PARTIES HERETO. THERE ARE NO ORAL AGREEMENTS AMONG THE PARTIES HERETO.

     Section 5.11 Limited Waiver as a Loan Document. This Agreement constitutes a Loan
Document and any failure of the Borrowers to comply with the terms and conditions of this Agreement
shall result in a Default (which may thereafter constitute an Event of Default as provided therein)
under the Loan and Security Agreement.

[Remainder of page intentionally left blank.]

LIMITED WAIVER OF LOAN AND SECURITY AGREEMENT — Page 6

 

 

     IN WITNESS WHEREOF, the parties have entered into this Agreement on the date first above
written.

	 	 	 	 	 	 	 
	 	 	BORROWERS:	 	 
	 
	 	 	 	 	 	 
	 	 	AMKOR TECHNOLOGY, INC.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Kenneth T. Joyce	 	 
	 

	 	 	 	 	 	 
	 

	 	Name:
	 	Kenneth T. Joyce	 	 
	 

	 	Title:
	 	Executive Vice President and CFO	 	 
	 
	 	 	 	 	 	 
	 	 	UNITIVE, INC.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Joanne Solomon	 	 
	 

	 	 	 	 	 	 
	 

	 	Name:
	 	Joanne Solomon	 	 
	 

	 	Title:
	 	Treasurer	 	 
	 
	 	 	 	 	 	 
	 	 	UNITIVE ELECTRONICS, INC.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Joanne Solomon	 	 
	 

	 	 	 	 	 	 
	 

	 	Name:
	 	Joanne Solomon	 	 
	 

	 	Title:
	 	Treasurer	 	 

LIMITED WAIVER OF LOAN AND SECURITY AGREEMENT — Page 7

 

 

	 	 	 	 	 	 	 
	 	 	AGENT:	 	 
	 
	 	 	 	 	 	 
	 	 	BANK OF AMERICA, N.A.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Joy L. Bartholomew	 	 
	 

	 	 	 	 	 	 
	 

	 	Name:
	 	Joy L. Bartholomew	 	 
	 

	 	Title:
	 	Senior Vice President	 	 

LIMITED WAIVER OF LOAN AND SECURITY AGREEMENT — Page 8

 

 

	 	 	 	 	 
	 	 	LENDERS:
	 
	 	 	 	 
	 	 	BANK OF AMERICA, N.A.
	 
	 	 	 	 
	 

	 	By:
	 	/s/ Joy L. Bartholomew
	 

	 	 	 	 
	 

	 	Name:
	 	Joy L. Bartholomew
	 

	 	Title:
	 	Senior Vice President
	 
	 	 	 	 
	 	 	WACHOVIA CAPITAL FINANCE CORPORATION (WESTERN)
	 
	 	 	 	 
	 

	 	By:
	 	/s/ Gary Whitaker
	 

	 	 	 	 
	 

	 	Name:
	 	Gary Whitaker
	 

	 	Title:
	 	Director
	 
	 	 	 	 
	 	 	TEXTRON FINANCIAL CORPORATION
	 
	 	 	 	 
	 

	 	By:
	 	/s/ Robert J. Dysart, Jr.
	 

	 	 	 	 
	 

	 	Name:
	 	Robert J. Dysart, Jr.
	 

	 	Title:
	 	Senior Account Executive

LIMITED WAIVER OF LOAN AND SECURITY AGREEMENT — Page 9exv10w1

 

EXHIBIT 10.1

FIFTH AMENDMENT TO CREDIT AGREEMENT AND WAIVER

     This FIFTH AMENDMENT, dated as of September 25, 2006 (this “Amendment”), to the Credit
Agreement referred to below is by and among (a) ZILA, INC., a Delaware corporation, ZILA
NUTRACEUTICALS, INC. (formerly known as Oxycal Laboratories Incorporated), an Arizona corporation,
ZILA TECHNICAL, INC., an Arizona corporation, ZILA BIOTECHNOLOGY, INC., an Arizona corporation,
ZILA PHARMACEUTICALS, INC., a Nevada corporation, and ZILA SWAB TECHNOLOGIES, INC., an Arizona
corporation (collectively, the “Borrowers”), (b) BLACK DIAMOND COMMERCIAL FINANCE, L.L.C.,
a Delaware corporation, as administrative agent for Lenders (the “Administrative Agent”),
and (c) the Required Lenders party to the Credit Agreement from time to time.

W I T N E S S E T H

     WHEREAS, the Borrowers, the Lenders and the Administrative Agent are parties to that certain
Credit Agreement, dated as of March 24, 2006 (including all annexes, exhibits and schedules
thereto, and as amended, supplemented or otherwise modified from time to time, the “Credit
Agreement”); and

     WHEREAS, the Borrowers request that the Agent and Required Lenders amend certain terms under
the Credit Agreement and waive compliance with certain covenants; and

     WHEREAS, the Administrative Agent and Required Lenders have agreed to the requested waiver and
amendments to the Credit Agreement, in the manner, and on the terms and conditions, provided for
herein.

     NOW THEREFORE, in consideration of the premises and for other good and valuable consideration,
the receipt, adequacy and sufficiency of which are hereby acknowledged, the parties hereto agree as
follows:

     1. Definitions. Capitalized terms not otherwise defined herein shall have the
meanings ascribed to them in the Credit Agreement.

     2. Amendments to Section 1 of the Credit Agreement. Section 1.1 of the
Credit Agreement, Definitions, is hereby amended by adding the following definitions in the
appropriate alphabetical order:

          “Fifth Amendment”: that certain Fifth Amendment to Credit Agreement and Waiver dated
as of September 25 2006, by and among Borrowers, Administrative Agent and Required Lenders.

          “Fifth Amendment Effective Date”: the date on which all conditions precedent to the
Fifth Amendment have been satisfied or waived by the Administrative Agent and Required Lenders.

 

 

     3. Amendment to Section 7 Affirmative Covenants of the Credit Agreement. Section
7 of the Credit Agreement is hereby amended by deleting Section 7.1(d)(i) and replacing
it with the following Section 7.1(d)(i):

     “(d) Financial Reporting:

     (i) no later than October 16, 2006, the unaudited consolidated and
consolidating balance sheets of Holdings and its subsidiaries and the related
unaudited consolidated and consolidating statements of income and the related
unaudited consolidated statements of cash flows for the month ending September 30,
2006 and the portion of the fiscal year through such date, setting forth, in each
case in comparative form to the figures for the previous year, certified by a
Responsible Officer as being fairly stated in all material respects (subject to
normal year-end audit adjustments) and all documents and other certifications
required pursuant to Section 7.2(b) of the Credit Agreement;”

     4. Amendment to Section 8 Negative Covenants of the Credit Agreement. Section
8 of the Credit Agreement is hereby amended by deleting Section 8.1(b)(iii) and
replacing it with the following Section 8.1(b)(iii):

“(iii) Minimum Unrestricted Cash. The Borrowers shall have, at
the end of each week set forth below, unrestricted book balances of
cash and Cash Equivalents for such week ended in an amount not less
than the amount set forth below opposite such week:

	 	 	 	 	 
	Week Ending	 	Minimum Unrestricted Cash	 
	September 22, 2006
	 	 	$2,750,000	 
	September 29, 2006 and each week ended thereafter
	 	 	$3,500,000	 

     5. Limited Waiver. Subject to the fulfillment of the conditions precedent to the
effectiveness of this Amendment set forth below, the Administrative Agent and the Required Lenders
hereby waive Borrowers’ compliance with the Financial Covenants set forth in Section
8.1(a)(i) (Minimum LTM EBITDA with respect to the Nutraceuticals Business) and Section
8.1(b)(i) (Minimum LTM EBITDA with respect to Borrowers) of the Credit Agreement for the fiscal
month ended August 31, 2006.

     6. Representations and Warranties. To induce the Administrative Agent and Lenders to
enter into this Amendment, the Borrowers executing this Amendment jointly and severally represent
and warrant that:

     (a) Each Borrower has taken all necessary organizational action to authorize the execution,
delivery and performance of this Amendment. 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 in
connection with the execution, delivery,

 - 2 -

 

performance, validity or enforceability of this Amendment,
except (i) consents, authorizations, filings and notices described in Schedule 5.4, which
consents, authorizations, filings and notices have been obtained or made and are in full force and
effect and (ii) the filings and recordings referred to in Section 5.19.

     (b) This Amendment has been duly executed and delivered by or on behalf of each of the
Borrowers.

     (c) This Amendment constitutes a legal, valid and binding obligation of each Borrower,
enforceable against each such Borrower in accordance with its terms, except as enforceability may
be limited by applicable bankruptcy, insolvency, reorganization, moratorium or similar laws
affecting the enforcement of creditors’ rights generally and by general equitable principles
(whether enforcement is sought by proceedings in equity or at law).

     (d) No Default or Event of Default has occurred and is continuing after giving effect to this
Amendment.

     (e) No litigation, investigation or proceeding of or before any arbitrator or Governmental
Authority is pending or, to the knowledge of any Borrower, threatened by or against any Group
Member or against any of their respective properties or revenues (a) with respect to any of the
Loan Documents or any of the transactions contemplated hereby or thereby, or (b) that could
reasonably be expected to have a Material Adverse Effect.

     (f) The representations and warranties of each Borrower contained in the Credit Agreement and
each other Loan Document shall be true and correct on and as of the Fifth Amendment Effective Date
with the same effect as if such representations and warranties had been made on and as of such
date, except that any such representation or warranty which is expressly made only as of a
specified date need be true only as of such date.

     7. No Other Amendments/Waivers. Except as expressly provided herein, (a) the Credit
Agreement shall be unmodified and shall continue to be in full force and effect in accordance with
its terms and (b) this Amendment shall not be deemed a waiver of any term or condition of any Loan
Document and shall not be deemed to prejudice any right or rights which the Administrative Agent or
any Lender may now have or may have in the future under or in connection with any Loan Document or
any of the instruments or agreements referred to therein, as the same may be amended from time to
time.

     8. Outstanding Indebtedness; Waiver of Claims. Each Borrower hereby acknowledges and
agrees that as of September 25, 2006, the aggregate outstanding principal amount of the Term Loan
is $19,951,724.12 (collectively, the “Outstanding Obligations”), and that such principal
amounts are payable pursuant to the Credit Agreement without
defense, offset, withholding, counterclaim or deduction of any kind. Each Borrower hereby
waives, releases, remises and forever discharges the Administrative Agent, Lenders and each other
Indemnified Person from any and all claims, suits, actions, investigations, proceedings or demands
arising out of or in connection with the Credit Agreement (collectively, “Claims”), whether
based in contract, tort, implied or express warranty, strict liability, criminal or civil statute
or common law of any kind or character, known or unknown, which

 - 3 -

 

such Borrower ever had, now has or
might hereafter have against the Administrative Agent or Lenders which relates, directly or
indirectly, to any acts or omissions of the Administrative Agent, Lenders or any other Indemnified
Person on or prior to the date hereof, provided that, the Borrowers do not waive any Claim
solely to the extent such Claim relates to the Administrative Agent’s or any Lender’s gross
negligence or willful misconduct.

     9. Expenses. Each Borrower hereby reconfirms its obligations pursuant to Sections
4.5 and 7.11 of the Credit Agreement to pay and reimburse the Administrative Agent and
Lenders for all reasonable costs and expenses (including, without limitation, reasonable fees of
counsel) incurred in connection with the negotiation, preparation, execution and delivery of this
Amendment and all other documents and instruments delivered in connection herewith.

     10. Effectiveness. This Amendment shall become effective as of the date hereof only
upon satisfaction in full in the judgment of the Administrative Agent of each of the following
conditions:

     (a) Amendment. The Administrative Agent shall have received four (4) original copies
of this Amendment duly executed and delivered by the Administrative Agent, Required Lenders and
each of the Borrowers.

     (b) Payment of Fees and Expenses. The Borrowers shall have paid to the Administrative
all costs, fees and expenses invoiced and owing in connection with this Amendment and the other
Loan Documents and due to the Administrative Agent (including, without limitation, reasonable legal
fees and expenses).

     (c) Amendment Fee. The Borrowers shall pay to the Administrative Agent, for the
benefit of the Administrative Agent, an amendment fee in the amount of $50,000.

     (d) Warrant. The Borrowers shall have delivered an executed amended and restated
Warrant in form and substance acceptable to the Administrative Agent.

     (e) Representations and Warranties. The representations and warranties of or on
behalf of each Borrower in this Amendment shall be true and correct on and as of the Fifth
Amendment Effective Date.

     11. GOVERNING LAW. THIS AMENDMENT SHALL BE GOVERNED BY, AND INTERPRETED IN ACCORDANCE
WITH, THE LAWS OF THE STATE OF NEW YORK.

     12. Counterparts. This Amendment may be executed by the parties hereto on any number
of separate counterparts and all of said counterparts taken together shall be deemed to constitute
one and the same instrument.

(SIGNATURE PAGE FOLLOWS)

 - 4 -

 

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

	 	 	 	 	 
	 	BORROWERS:

ZILA, INC.

 	 
	 	By:  	/s/ Andrew A. Stevens
 	 
	 	 	Name:  	Andrew A. Stevens 	 
	 	 	Title:  	VP and CFO 	 
	 

	 	 	 	 	 
	 	ZILA TECHNICAL, INC.

 	 
	 	By:  	/s/ Andrew A. Stevens
 	 
	 	 	Name:  	Andrew A. Stevens 	 
	 	 	Title:  	VP and CFO 	 
	 

	 	 	 	 	 
	 	ZILA BIOTECHNOLOGY, INC.

 	 
	 	By:  	/s/ Andrew A. Stevens
 	 
	 	 	Name:  	Andrew A. Stevens 	 
	 	 	Title:  	VP and CFO 	 
	 

	 	 	 	 	 
	 	ZILA NUTRACEUTICALS, INC.

 	 
	 	By:  	/s/ Andrew A. Stevens
 	 
	 	 	Name:  	Andrew A. Stevens 	 
	 	 	Title:  	VP and CFO 	 
	 

	 	 	 	 	 
	 	ZILA PHARMACEUTICALS, INC.

 	 
	 	By:  	/s/ Andrew A. Stevens
 	 
	 	 	Name:  	Andrew A. Stevens 	 
	 	 	Title:  	VP and CFO 	 

  

 

	 	 	 	 	 

	 	 	 	 	 
	 	ADMINISTRATIVE AGENT:

BLACK DIAMOND COMMERCIAL FINANCE, L.L.C.

 	 
	 	By:  	/s/ Stuart Armstrong
 	 
	 	 	Name:  	Stuart Armstrong 	 
	 	 	Title:  	President and CEO 	 

 

 

	 	 	 	 	 

	 	 	 	 	 	 	 
	 	 	LENDER:
	 
	 	 	 	 	 	 
	 	 	BDC FINANCE, LLC
	 
	 	 	 	 	 	 
	 	 	By:	 	Black Diamond
Capital Management, L.L.C., its
Investment Manager
	 
	 	 	 	 	 	 
	 	 	By:	 	/s/ James J. Zenni
	 	 	 	 	 
	 

	 	 	 	Name:
	 	James J. Zenni, Jr.
	 

	 	 	 	Title:
	 	President & Managing Partner
	 

	 	 	 	 	 	Black Diamond Capital
	 

	 	 	 	 	 	Management, L.L.C.

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