Document:

CPIX 2013-10K-Exhibit 10.16.3 BOA Waiver

Exhibit 10.16.3

WAIVER

THIS WAIVER (this “Waiver”) dated as of March 6, 2014 is by and between Cumberland Pharmaceuticals Inc., a Tennessee corporation (the “Borrower”), and Bank of America, N.A. (the “Bank”).

W I T N E S S E T H:

WHEREAS, a revolving credit facility has been extended to the Borrower pursuant to the Fifth Amended and Restated Loan Agreement (as amended, modified and supplemented from time to time, the “Loan Agreement”) dated as of August 2, 2011 between the Borrower and the Bank; and
    
WHEREAS, the Borrower has requested certain waivers to the Loan Agreement and the Bank has agreed to the requested waivers on the terms and conditions set forth herein.  

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

1.    Defined Terms.  Capitalized terms used herein but not otherwise defined herein shall have the meaning specified in the Loan Agreement.

2.    Waiver.  The Bank waives any default arising solely from the Borrower’s failure to comply with (a) the financial covenant set forth in Section 8.4 of the Loan Agreement (Interest Coverage Ratio) as of the end of fiscal period ending December 31, 2013 and (b) Section 10.15 of the Loan Agreement resulting from the acquisition by A.J. Kazimi prior to the date hereof of stock of the Borrower which acquisition resulted in A.J. Kazimi having beneficial ownership or control, directly or indirectly, of thirty-one percent (31%) of the common or other voting stock of the Borrower.  Each of the foregoing waivers is a one-time waiver and applies only to the specified circumstance and does not modify or otherwise affect the Borrower’s obligations to comply with such provisions of the Loan Agreement or any other provision of the Loan Agreement in any other instance.  In consideration of such waiver, the Borrower and the Bank agree that notwithstanding anything in the Loan Agreement to the contrary, any request to advance credit under the Facilities on and after the date hereof shall be in the sole and absolute discretion of the Bank and may be made under such terms and conditions as the Bank may in its sole and absolute discretion deem appropriate.  The making of any advance of credit shall in no way represent a commitment by Bank to make any further or additional advances of credit.  

3.    Conditions Precedent.  This Waiver shall be effective as of the date hereof upon receipt by the Bank of this Waiver executed by the Borrower.

4.    Release.  In consideration of the Bank’s willingness to enter into this Waiver, the Borrower hereby releases and forever discharges the Bank and each of the Bank’s predecessors, successors, assigns, officers, managers, directors, employees, agents, attorneys, representatives, and affiliates (hereinafter all of the above collectively referred to as the “Bank Group”), from any and all claims, counterclaims, demands, damages, debts, suits, liabilities, actions and causes of action of any nature whatsoever, including, without limitation, all claims, demands, and causes of action for contribution and indemnity, whether arising at law or in equity, whether known or unknown, whether liability be direct or indirect, liquidated or unliquidated, whether absolute or contingent, foreseen or unforeseen, and whether or not heretofore asserted, which the Borrower may have or claim to have against any of the Bank Group.

5.    No Other Changes.  Except as expressly modified hereby, all of the terms of the Loan Documents remain in full force and effect.

6.    Waiver as a Loan Document; Representations and Warranties.  

(a)    This Waiver is a “Loan Document”.

(b)    The Borrower hereby represents and warrants to Bank that as of the date hereof (i) the representations and warranties of the Borrower and each other Obligor contained in the Loan Documents, or which are contained in any document furnished at any time under or in connection therewith, are true and correct on and as of the date hereof and (ii) no event of default exists under any of the Loan Documents.

7.    Reaffirmation of Obligations.  The Borrower (i) acknowledges and consents to all of the terms and conditions of this Waiver, (ii) affirms all of its obligations under the Loan Documents and (iii) agrees that this Waiver and all documents executed in connection herewith do not operate to reduce or discharge the Borrower’s obligations under the Loan Documents.

8.     Reaffirmation of Security Interests.  The Borrower (i) affirms that each of the security interests and liens granted in or pursuant to the Loan Documents are valid and subsisting and (ii) agrees that this Waiver shall in no manner impair or otherwise adversely effect any of the security interests and liens granted in or pursuant to the Loan Documents.

9.     Counterparts; Delivery.  This Waiver may be executed in any number of counterparts, each of which when so executed and delivered shall be deemed an original and it shall not be necessary in making proof of this Waiver to produce or account for more than one such counterpart. Delivery of an executed counterpart of this Waiver by facsimile or other electronic imaging means shall be effective as an original.

10.    Governing Law.  This Waiver shall be governed by, and construed in accordance with, the laws of the State of Tennessee.

[Signature Pages Follow]

IN WITNESS WHEREOF, each of the parties hereto has caused this Waiver to be duly executed and delivered as of the date first above written.

		
	BORROWER:
	  CUMBERLAND PHARMACEUTICALS INC., 

  a Tennessee corporation
	
		
	By:
	/s/ Rick S. Greene

	Name:
	Rick S. Greene

	Title:
	VP & CFO

BANK:                     BANK OF AMERICA, N.A.
                
    	
		
	By:
	/s/ H. Hope Walker

	Name:
	H. Hope Walker

	Title:
	V.P

CONSENT AND REAFFIRMATION
OF OBLIGORS

Each of the undersigned Obligors, hereby (i) acknowledges and consents to all of the terms and conditions of this Waiver, (ii) affirms all of its obligations under the Loan Documents to which it is a party, (iii) agrees that this Waiver and all documents executed in connection herewith do not operate to reduce or discharge such Obligor’s obligations under the Loan Documents to which it is a party, (iv) affirms that each of the security interests and liens granted in or pursuant to the Loan Documents are valid and subsisting and (v) agrees that this Waiver shall in no manner impair or otherwise adversely effect any of the security interests and liens granted in or pursuant to the Loan Documents.  (Capitalized terms used herein shall have the meanings specified in the foregoing Waiver.)

Although each of the undersigned has been informed of the terms of the Waiver, each understands and agrees that the Bank has no duty to so notify it or any other Obligor or to seek this or any future acknowledgment, consent or reaffirmation, and nothing contained herein shall create or imply any such duty as to any transactions, past or future.

Dated as of the first date list above.  

		
	OBLIGORS:
	  CUMBERLAND PHARMA SALES CORP., 

  a Tennessee corporation
  CUMBERLAND EMERGING TECHNOLOGIES, INC., 
  a Tennessee corporation        
	
		
	By:
	/s/ Rick S. Greene

	Name:
	Rick S. Greene

	Title:
	VP & CFOExhibit 10.1 Performance-based Stock Option Award Agreement

Exhibit 10.1

CIRCOR INTERNATIONAL, INC.
PERFORMANCE-BASED STOCK OPTION AWARD

THIS PERFORMANCE-BASED STOCK OPTION is granted by CIRCOR International, Inc. (the “Company”) to Scott A. Buckhout, (the “Optionee”) as of the 5th day of March, 2014 (the “Grant Date”).

WHEREAS, the Board desires to deliver sustainable shareholder value and achieve consistent returns at or above market value;

WHEREAS, the Board has determined that it is in the best interests of the Company to grant a performance-based stock option award to Optionee on the terms and conditions set forth below; and

WHEREAS, the Optionee finds such terms and conditions to be acceptable.

NOW, THEREFORE, in consideration of the premises and of the services performed and to be performed by the Optionee, the Company hereby grants this Stock Option to the Optionee on the terms and conditions hereinafter expressed (this “Agreement”).

1.    OPTION GRANT

The Optionee shall have the right to purchase a total of 100,000 shares of the Company’s common stock, par value $.01 per share (“Common Stock”) at an exercise price per share of $70.42 representing the closing price of the Company’s Common Stock on the NYSE on March 4, 2014 and which the Compensation Committee of the Board has affirmatively determined to represent the fair market value per share of the Company’s common stock as of the date herof. The term of this Stock Option shall extend until the tenth anniversary of the Grant Date (the “Expiration Date”), subject to earlier termination as set forth below.  The Optionee may only exercise this Stock Option to the extent that it is vested under Section 2 below and is exercisable under Sections 3 and 4 below.  The permitted methods to exercise this Stock Option are set forth in Section 5 below.  Except as specifically provided to the contrary under this Agreement, (a) capitalized terms not otherwise defined herein shall have the meanings set forth for such terms in the CIRCOR International, Inc. Amended and Restated 1999 Stock Option and Incentive Plan (the “Plan”), and (b) this Stock Option shall be construed and administered in accordance with the Plan, the terms of which are hereby incorporated by reference, including but not limited to the provisions with respect to the powers of the Administrator to interpret this Stock Option and adjust its terms.  This Stock Option is not intended to qualify as an Incentive Stock Option.

2.    VESTING

No portion of this Stock Option shall be vested on the Grant Date.  The Optionee may vest in this Stock Option, in whole or in part, based on achieving the stock price performance vesting requirements set forth in this Section.  Vesting or becoming vested under this Section 2 shall only entitle the Optionee to exercise the vested portion of this Stock Option at the times provided for in Sections 3 and 4 below.  The unvested portion of this Stock Option shall be forfeited immediately upon termination of employment with the Company and its Subsidiaries for any reason. 

(a)    This Stock Option shall vest under this Section 2(a) only to the extent that the Company achieves a Stock Price Target as set forth in the table below, provided that the Optionee remains employed by the Company or its Subsidiaries when the Company achieves such Stock Price Target:

	
		
	Stock Price Target
	Cumulative Vested Portion of Stock Option
(in shares)

	$87.50
	25,000

	$100.00
	50,000

	$112.50
	75,000

	$125.00
	100,000

For purposes of this Section 2(a), the following rules shall apply:

(1)      A Stock Price Target shall only be considered to have been attained prior to a Sale Event if the closing price of share of Common Stock is equal to or higher than such Stock Price Target for a period of sixty (60) consecutive trading days.

(2)    If there is a Sale Event prior to the fifth anniversary of the Grant Date, a Stock Price Target shall be determined based on the aggregate value of the consideration paid with respect to a share of Common Stock upon or in connection with such event as reasonably determined by the Committee, and any shares of Common Stock relating to this Stock Option for which a Stock Price Target has been met upon such sale but which are previously unvested shall immediately vest and be exercisable.

(3)    Any portion of the Stock Option that vests under this Section 2(a) shall remain vested regardless of the Company’s subsequent stock price performance.

(b)    Any portion of this Stock Option that has not vested by the fifth (5th) anniversary of the Grant date shall be immediately forfeited.

3.    OPTION EXERCISE DURING EMPLOYMENT

The Optionee may exercise the portion of this Stock Option that has vested under Section 2 while employed by the Company or its Subsidiaries prior to the Expiration Date as follows: (i) 25% upon vesting, (ii) 50% upon the 1st anniversary of vesting and (iii) 100% upon the 2nd anniversary of vesting.  The foregoing provision regarding exercisability shall apply separately to each portion of this Stock Option that becomes vested based on a different Stock Price Target; provided, however, that in all events the vested portion of the Option shall be fully exercisable on the 5th anniversary of the Grant Date if the Optionee is then employed by the Company or its Subsidiaries.  If there is a Sale Event before the fifth anniversary of the Grant Date and the Optionee is then employed by the Company or its Subsidiaries, the Optionee may exercise the vested portion of his Options subject to the provision of Section 3.

4.    OPTION EXERCISE AFTER EMPLOYMENT TERMINATION

If the Optionee is a “Good Leaver” (as defined below), he may exercise Options that were previously vested for three months following his employment termination date.  If the Optionee terminates employment for any other reason, he shall immediately forfeit all Options whether vested or unvested.  The Optionee shall be a "Good Leaver" if either (i) he terminates his employment with the Company and its Subsidiaries due to death or Disability, (ii) the Company and its Subsidiaries terminate his employment without Cause, or (iii) he terminates employment with the Company and its Subsidiaries for Good Reason.  For purposes of this Stock Option, “Cause” and “Good Reason” shall have the meanings set forth the Severance Agreement between the Optionee and the Company dated April 9, 2013.  “Disability” shall have the meaning set forth 

in Section 22(e) of the Code.  The unexercised portion of this Stock Option shall forever lapse upon the earlier of the exercise date and three months after employment termination. 

5.    METHOD OF EXERCISE

(a)     The Optionee may exercise this Stock Option only in the following manner: from time to time on or prior to the Expiration Date of this Stock Option, the Optionee may give written notice to the Administrator of his or her election to purchase some or all of the vested Option Shares purchasable at the time of such notice.  This notice shall specify the number of Option Shares to be purchased. 

Payment of the purchase price for the Option Shares may be made by one or more of the following methods: (i) in cash, by certified or bank check or other instrument acceptable to the Administrator; (ii) by the Optionee delivering (or attesting to the ownership of) shares of Stock that have been purchased by the Optionee on the open market or that have been beneficially owned by the Optionee for at least six months and that are not then subject to restrictions under any Company plan; (iii) by the Optionee delivering to the Company a properly executed exercise notice together with irrevocable instructions to a broker to promptly deliver to the Company cash or a check payable and acceptable to the Company to pay the option purchase price, provided that in the event the Optionee chooses to pay the option purchase price as so provided, the Optionee and the broker shall comply with such procedures and enter into such agreements of indemnity and other agreements as the Administrator shall prescribe as a condition of such payment procedure; (iv) by Optionee electing a “net exercise” method pursuant to which the Company shall retain a sufficient number of shares to pay both the exercise price and required tax withholdings; or (v) a combination of (i), (ii), (iii) and (iv) above. Payment instruments will be received subject to collection. 

The transfer to the Optionee on the records of the Company or of the transfer agent of the Option Shares will be contingent upon (i) the Company’s receipt from the Optionee of the full purchase price for the Option Shares, as set forth above, (ii) the fulfillment of any other requirements contained herein or in the Plan or in any other agreement or provision of laws, and (iii) the receipt by the Company of any agreement, statement or other evidence that the Company may require to satisfy itself that the issuance of Stock to be purchased pursuant to the exercise of Stock Options under the Plan and any subsequent resale of the shares of Stock will be in compliance with applicable laws and regulations. In the event the Optionee chooses to pay the purchase price by previously-owned shares of Stock through the attestation method, the number of shares of Stock transferred to the Optionee upon the exercise of the Stock Option shall be net of the shares attested to. 

(b)     The shares of Stock purchased upon exercise of this Stock Option shall be transferred to the Optionee on the records of the Company or of the transfer agent upon compliance to the satisfaction of the Administrator with all requirements under applicable laws or regulations in connection with such transfer and with the requirements hereof and of the Plan. The determination of the Administrator as to such compliance shall be final and binding on the Optionee.  The Optionee shall not be deemed to be the holder of, or to have any of the rights of a holder with respect to, any shares of Stock subject to this Stock Option unless and until this Stock Option shall have been exercised pursuant to the terms hereof, the Company or the transfer agent shall have transferred the shares to the Optionee, and the Optionee’s name shall have been entered as the stockholder of record on the books of the Company.  Thereupon, the Optionee shall have full voting, dividend and other ownership rights with respect to such shares of Stock. 

(c)     The minimum number of shares with respect to which this Stock Option may be exercised at any one time shall be 100 shares, unless the number of shares with respect to which this Stock Option is being exercised is the total number of shares subject to exercise under this Stock Option at the time. 

(d) Notwithstanding any other provision hereof or of the Plan, no portion of this Stock Option shall be exercisable after the Expiration Date hereof and the exercisability of this Stock Option shall be subject to making acceptable arrangements with the Company for tax withholding consistent with the terms of the Plan.

6.    TRANSFER LIMITATIONS

This Agreement is personal to the Optionee, is non-assignable and is not transferable in any manner, by operation of law or otherwise, other than by will or the laws of descent and distribution.  This Stock Option is exercisable, during the Optionee’s lifetime, only by the Optionee, and thereafter, only by the Optionee’s legal representative or legatee.

7.    CLAWBACK

This Stock Option and the shares of Common Stock subject to this Stock Option shall be subject to, and shall comply with, the Company’s stock ownership guidelines (unless waived by the Committee) and the Company’s policies that are applicable to all executive officers regarding forfeitures of incentive awards due to material financial restatements, executive misconduct or other wrongdoing, as may be in effect from time to time.  For avoidance of doubt, such policies include any compensation recovery policy as may be adopted in connection with meeting applicable exchange listing requirements.

8.    ADJUSTMENT

This Stock Option shall be subject to adjustment by the Committee pursuant to Section 3(b) of the Plan on account of any transaction described therein.  The Optionee specifically acknowledges that the Committee in its sole discretion may, among other things, unilaterally cancel this Stock Option in connection with a Sale Event by providing the Optionee a cash payment (less applicable withholding taxes) in an amount equal to the excess, if any, of the value of the acquisition consideration payable with respect to a share of Common Stock over the exercise price per share as provided in Section 1 above, multiplied by the number of vested shares remaining exercisable hereunder (determined after taking into account any vesting as a result of a Sale Event under this Stock Option).

9.    Miscellaneous Provisions
(a)    Integrated Agreement.  This Stock Option constitutes the entire understanding and agreement between the Optionee and the Company with respect to the subject matter contained herein and supersedes any prior agreements, understandings, restrictions, representations, or warranties between the Optionee and the Company with respect to such subject matter other than those as set forth or provided for herein.  To the extent contemplated herein, the provisions of this Stock Option shall survive any exercise of this option and shall remain in full force and effect.

(b)    Employment.  For purposes of this Stock Option, “employment” shall mean the performance of services for the Company or a Subsidiary as an employee for federal income tax purposes.  The Optionee shall be deemed to have terminated employment either upon an actual termination of service with the Company and its Subsidiaries, or at the time that the Subsidiary for which the Optionee is employed by ceases to be a Subsidiary under the terms of the Plan, provided that the Optionee is not employed immediately thereafter by the Company.  The Optionee’s employment with the Company or one of its Subsidiaries shall not be deemed to have terminated if the Optionee takes any military leave, sick leave, or other bona fide leave of absence approved by the Company or the Subsidiary, as applicable, regardless of whether pay is suspended during such leave.

(c)    Governing Law.  This Stock Option shall be governed by and construed in accordance with the laws of the State of Delaware without regard to conflict of law principles.
(d)    Headings.  The headings are intended only for convenience in finding the subject matter and do not constitute part of the text of this Stock Option and shall not be considered in the interpretation of this option.
(e)    Saving Clause.  If any provision(s) of this Stock Option shall be determined to be illegal or unenforceable, such determination shall in no manner affect the legality or enforceability of any other provision hereof.
(f)    Notices.  All notices, requests, consents and other communications shall be in writing and be deemed given when delivered personally, by telex or facsimile transmission or when received if mailed by first class registered or certified mail, postage prepaid.  Notices to the Company or the Optionee shall be addressed to such address or addresses as may have been furnished by such party in writing to the other.
(g)    Benefit and Binding Effect.  This Stock Option shall be binding upon and shall inure to the benefit of the parties hereto, their respective successors, permitted assigns, and legal representatives.  The Company has the right to assign this Stock Option, and such assignee shall become entitled to all the rights of the Company hereunder to the extent of such assignment.
(h)    Counterparts.  For the convenience of the parties and to facilitate execution, this Stock Option may be executed in two or more counterparts, each of which shall be deemed an original, but all of which shall constitute one and the same document.

[rest of page intentionally left blank]

IN WITNESS WHEREOF, the Company has caused the execution hereof by its duly authorized officer and Optionee has agreed to the terms and conditions of this option, all effective as of the date first above written.

CIRCOR INTERNATIONAL, INC.

By___/s/ Alan J. Glass_____________________________
Alan J. Glass
VP, General Counsel & Secretary
                                

By___/s/ Scott A. Buckhout_________________________
Scott A. Buckhout

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