UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): March 30, 2017
Nordson Corporation
(Exact name of registrant as specified in its charter)
Ohio | 0-7977 | 34-0590250 | ||
(State or Other Jurisdiction of Incorporation) |
(Commission File Number) |
(I.R.S. Employer Identification Number) | ||
28601 Clemens Road, Westlake, Ohio | 44145 | |||
(Address of principal executive offices) | (Zip Code) |
Registrants telephone number, including area code: (440) 892-1580
Not Applicable
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
☐ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
☐ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
☐ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
☐ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Item 1.01 | Entry into a Material Definitive Agreement. |
Amendment to Merger Agreement
As previously announced, on February 20, 2017, Nordson Corporation (Nordson), Viking Merger Corp. (Merger Sub), a wholly owned subsidiary of Nordson, Vention Medical Holdings, Inc. (Vention) and VMHI Rep Services, LLC (VMHI), as stockholder representative, entered into an Agreement and Plan of Merger (the Merger Agreement). Pursuant to the terms of the Merger Agreement, Vention will be merged with and into Merger Sub (the Merger) effective as of the effective time of the Merger (the Effective Time).
On March 30, 2017, Nordson, Merger Sub, Vention and VMHI entered into the First Amendment to Agreement and Plan of Merger (the Amendment) pursuant to which the parties agreed, among other things, that the Cash Consideration (as defined in the Merger Agreement) would be increased by $11.5 million and, in connection therewith, that Nordson would not have any obligation to pay to Ventions stakeholders any tax refunds or credits related to the pre-closing periods and any tax benefits related to the pre-closing periods that are utilized by Nordson after the consummation of the Merger.
The foregoing description of the Amendment is a summary only and is qualified in its entirety by the terms of the Amendment, a copy of which is filed as an exhibit to this Current Report on Form 8-K and is incorporated herein by reference.
Term Loan Agreement
On March 31, 2017, in connection with the closing of the Merger, Nordson established a $705.0 million term loan facility pursuant to the terms of the First Amendment and Joinder to Term Loan Agreement (the Term Loan Amendment), dated as of March 31, 2017, by and among Nordson, the lenders party thereto and PNC Bank, National Association, as lender and administrative agent, which amended the single-purpose term loan agreement (as amended by the Term Loan Amendment, the Term Loan Agreement), by and among Nordson, the lenders party thereto, PNC Bank, National Association, as lender and administrative agent, the joint lead arrangers and joint bookrunners party thereto, the co-syndication agents party thereto and the co-documentation agents party thereto.
The Term Loan Agreement:
| provides for the following term loans in three tranches: |
| $200.0 Million Eighteen Month Senior Unsecured Term Loan |
| $200.0 Million Three Year Senior Unsecured Term Loan |
| $305.0 Million Five Year Senior Unsecured Term Loan; |
| contains a number of covenants that Nordson believes are usual and customary for single-purpose unsecured term loan agreements, including compliance with various financial ratios and tests, and certain covenants that restrict, among other things, Nordsons and its subsidiaries ability to: incur debt; incur liens; merge or consolidate with other companies and make certain acquisitions; and |
| contains customary events of default (subject to grace periods, as appropriate) including among others: nonpayment of principal, interest or fees; breach of the representations or warranties in any material respect; breach of the financial, affirmative or negative covenants; default of payment on, or accelerations of, other material indebtedness; bankruptcy or insolvency; material judgments entered against Nordson or any of its subsidiaries; certain specified events under the Employee Retirement Income Security Act of 1974, as amended; certain changes in control of Nordson; and the invalidity or unenforceability of the Term Loan Agreement or other documents associated with the Term Loan Agreement. |
Borrowings under the Term Loan Agreement bear interest at either an alternate base rate or an adjusted LIBOR rate plus, in each case, an applicable margin. Such applicable margin is based on Nordsons Leverage Ratio (as defined in the Term Loan Agreement). Interest is payable (a) in the case of alternate base rate loans, quarterly, and (b) in the
case of LIBOR rate loans, on the maturity date of the borrowing, or quarterly from the effective date for borrowings exceeding three months.
Borrowings under the Term Loan Agreement are available for use by Nordson for the single purpose of acquiring Vention via the Merger.
The foregoing description of the Term Loan Agreement is a summary only and is qualified in its entirety by the terms of the Term Loan Agreement, a copy of which is filed as an exhibit to this Current Report on Form 8-K and is incorporated herein by reference.
Item 2.01 | Completion of Acquisition or Disposition of Assets. |
On March 31, 2017, pursuant to the terms of the Merger Agreement, Nordson, Vention and Merger Sub completed the Merger, with Vention merging with and into Merger Sub (the Merger) effective as of the Effective Time. As a result of the Merger, Merger Sub ceased to exist and Vention survived as a wholly owned subsidiary of Nordson.
Vention is a leading designer, developer and manufacturer of minimally invasive interventional delivery devices, catheters and advanced components for the global medical technology market. Under the terms of the Merger Agreement, as amended, Nordson acquired Vention, excluding all of the outstanding capital stock of Vention Medical, Inc. (Vention Medical), and certain subsidiaries of Vention Medical that were sold to a third party prior to the Effective Time, on a cash-free and debt-free basis for an aggregate purchase price of $716.5 million, subject to certain adjustments (including a customary working capital adjustment), resulting in a transaction with an approximate enterprise value of $705 million.
The foregoing description of the Merger Agreement is a summary only and is qualified in its entirety by the terms of the Merger Agreement, a copy of which is filed as an exhibit to this Current Report on Form 8-K and is incorporated herein by reference.
Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant.
The disclosures set forth in Item 1.01 of this Current Report on Form 8-K pertaining to the Term Loan Agreement are hereby incorporated by reference into this Item 2.03. On March 31, 2017, Nordson borrowed the full $705.0 million available under the Term Loan Agreement to fund a portion of the consideration for the Merger.
Item 9.01 | Financial Statements and Exhibits. |
(a) | Financial Statement of Business Acquired. |
Nordson will provide the financial statements required to be filed by Item 9.01(a) of Form 8-K by amendment to this Current Report on Form 8-K no later than the 71st day after the required filing date for this Current Report on Form 8-K.
(b) | Pro Forma Financial Information. |
Nordson will provide the pro forma financial information required to be filed by Item 9.01(b) of Form 8-K by amendment to this Current Report on Form 8-K no later than the 71st day after the required filling date for this Current Report on Form 8-K.
(d) | Exhibits. |
Exhibit |
Description | |
2.1* | Agreement and Plan of Merger, dated as of February 20, 2017, by and among Nordson Corporation, Viking Merger Corp., Vention Medical Holdings, Inc. and VMHI Rep Services, LLC | |
2.2 | First Amendment to Agreement and Plan of Merger, dated as of March 30, 2017, by and among Nordson Corporation, Viking Merger Corp., Vention Medical Holdings, Inc. and VMHI Rep Services, LLC | |
4.1 | First Amendment and Joinder to Term Loan Agreement, dated as of March 31, 2017, by and among Nordson Corporation, the lenders party thereto and PNC Bank, National Association, as administrative agent and lender, and Term Loan Agreement, dated as of February 21, 2017, by and among Nordson Corporation, the lenders party thereto, PNC Bank, National Association, as lender and administrative agent, the joint lead arrangers and joint bookrunners party thereto, the co-syndication agents party thereto and the co-documentation agents party thereto |
* | Certain exhibits and schedules have been omitted and Nordson agrees to furnish supplementally to the Securities and Exchange Commission a copy of any omitted exhibits and schedules upon request. |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, hereunto duly authorized.
NORDSON CORPORATION | ||||||
Date: April 5, 2017 | By: | /s/ Robert E. Veillette | ||||
Robert E. Veillette | ||||||
Vice President, General Counsel & Secretary |
EXHIBIT INDEX
Exhibit |
Description | |
2.1* | Agreement and Plan of Merger, dated as of February 20, 2017, by and among Nordson Corporation, Viking Merger Corp., Vention Medical Holdings, Inc. and VMHI Rep Services, LLC | |
2.2 | First Amendment to Agreement and Plan of Merger, dated as of March 30, 2017, by and among Nordson Corporation, Viking Merger Corp., Vention Medical Holdings, Inc. and VMHI Rep Services, LLC | |
4.1 | First Amendment and Joinder to Term Loan Agreement, dated as of March 31, 2017, by and among Nordson Corporation, the lenders party thereto and PNC Bank, National Association, as administrative agent and lender, and Term Loan Agreement, dated as of February 21, 2017, by and among Nordson Corporation, the lenders party thereto, PNC Bank, National Association, as lender and administrative agent, the joint lead arrangers and joint bookrunners party thereto, the co-syndication agents party thereto and the co-documentation agents party thereto |
* | Certain exhibits and schedules have been omitted and Nordson agrees to furnish supplementally to the Securities and Exchange Commission a copy of any omitted exhibits and schedules upon request. |
Exhibit 2.1
EXECUTION VERSION
AGREEMENT AND PLAN OF MERGER
by and among
VENTION MEDICAL HOLDINGS, INC.,
NORDSON CORPORATION,
VIKING MERGER CORP.
and
VMHI REP SERVICES, LLC
dated as of February 20, 2017
TABLE OF CONTENTS
Page | ||||||
ARTICLE I DEFINITIONS; CONSTRUCTION | 2 | |||||
Section 1.1 |
Definitions |
2 | ||||
Section 1.2 |
Other Defined Terms |
17 | ||||
Section 1.3 |
Construction |
20 | ||||
Section 1.4 |
Disclosure Schedule |
21 | ||||
ARTICLE II MERGER | 22 | |||||
Section 2.1 |
Agreement to Merge |
22 | ||||
Section 2.2 |
Effect of the Merger |
22 | ||||
Section 2.3 |
Certificate of Incorporation and Bylaws |
22 | ||||
Section 2.4 |
Directors and Officers |
22 | ||||
Section 2.5 |
Effect on Stock and Options |
23 | ||||
Section 2.6 |
Exchange of Certificates |
27 | ||||
ARTICLE III MERGER CONSIDERATION | 29 | |||||
Section 3.1 |
Merger Consideration |
29 | ||||
Section 3.2 |
Closing Date Statements |
29 | ||||
Section 3.3 |
Payment of Cash Consideration |
30 | ||||
Section 3.4 |
Payment of Escrow Amount |
31 | ||||
Section 3.5 |
Payment of Other Amounts Payable at Closing |
32 | ||||
Section 3.6 |
Post-Closing Adjustment |
32 | ||||
ARTICLE IV REPRESENTATIONS AND WARRANTIES OF THE COMPANY | 35 | |||||
Section 4.1 |
Organization |
35 | ||||
Section 4.2 |
Authorization |
35 | ||||
Section 4.3 |
Capital Stock; Indebtedness |
37 | ||||
Section 4.4 |
Subsidiaries |
37 | ||||
Section 4.5 |
Absence of Restrictions and Conflicts |
37 | ||||
Section 4.6 |
Real Property |
38 | ||||
Section 4.7 |
Title to Assets; Related Matters |
39 | ||||
Section 4.8 |
Inventory |
39 | ||||
Section 4.9 |
Financial Statements |
39 | ||||
Section 4.10 |
Absence of Certain Changes |
40 |
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TABLE OF CONTENTS
(continued)
Page | ||||||
Section 4.11 |
Legal Proceedings |
40 | ||||
Section 4.12 |
Compliance with Laws; Licenses |
40 | ||||
Section 4.13 |
Company Contracts |
41 | ||||
Section 4.14 |
Tax Returns; Taxes |
43 | ||||
Section 4.15 |
Company Benefit Plans |
45 | ||||
Section 4.16 |
Labor Relations |
47 | ||||
Section 4.17 |
Insurance Policies |
47 | ||||
Section 4.18 |
Environmental Matters |
47 | ||||
Section 4.19 |
Intellectual Property |
48 | ||||
Section 4.20 |
Software |
49 | ||||
Section 4.21 |
FDA Compliance |
50 | ||||
Section 4.22 |
Brokers, Finders and Investment Bankers |
52 | ||||
Section 4.23 |
Officers and Select Employees |
52 | ||||
Section 4.24 |
Customer and Supplier Relations |
52 | ||||
Section 4.25 |
Transactions with Affiliates |
53 | ||||
Section 4.26 |
Investment Company |
53 | ||||
ARTICLE V REPRESENTATIONS AND WARRANTIES OF THE PURCHASER AND MERGER SUB | 53 | |||||
Section 5.1 |
Organization |
53 | ||||
Section 5.2 |
Authorization |
53 | ||||
Section 5.3 |
Absence of Restrictions and Conflicts |
54 | ||||
Section 5.4 |
Financial Capacity; Solvency |
54 | ||||
Section 5.5 |
Legal Proceedings |
55 | ||||
Section 5.6 |
Investment Intent |
55 | ||||
Section 5.7 |
Status as Accredited Investor |
55 | ||||
Section 5.8 |
Brokers, Finders and Investment Bankers |
55 | ||||
Section 5.9 |
Reliance; Inspection |
56 | ||||
ARTICLE VI CERTAIN COVENANTS AND AGREEMENTS | 57 | |||||
Section 6.1 |
Ordinary Course Conduct of Business by the Company |
57 | ||||
Section 6.2 |
Inspection and Access to Information |
59 |
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TABLE OF CONTENTS
(continued)
Page | ||||||
Section 6.3 |
Government Filings and Approvals |
60 | ||||
Section 6.4 |
Public Announcements |
61 | ||||
Section 6.5 |
Company Benefit Plans |
62 | ||||
Section 6.6 |
Section 280G |
63 | ||||
Section 6.7 |
Directors and Officers Indemnification |
63 | ||||
Section 6.8 |
Company Stockholder Approval; Appraisal Rights |
65 | ||||
Section 6.9 |
Tax Matters |
65 | ||||
Section 6.10 |
Notification of Events; Supplemental Disclosure |
69 | ||||
Section 6.11 |
Retention of Books and Records |
69 | ||||
Section 6.12 |
Contact with Customers and Suppliers |
69 | ||||
Section 6.13 |
Cooperation on Financing |
69 | ||||
Section 6.14 |
Exclusivity |
71 | ||||
Section 6.15 |
DMS Transaction |
71 | ||||
Section 6.16 |
Transition Services Agreement |
72 | ||||
Section 6.17 |
Salary Continuation, Separation and Release Agreements |
73 | ||||
Section 6.18 |
Consents and Releases |
73 | ||||
Section 6.19 |
Certain Filings |
73 | ||||
Section 6.20 |
Post-Closing Option Consideration |
73 | ||||
ARTICLE VII CONDITIONS TO CLOSING | 73 | |||||
Section 7.1 |
Conditions to Each Partys Obligations |
73 | ||||
Section 7.2 |
Conditions to Obligations of the Purchaser and Merger Sub |
74 | ||||
Section 7.3 |
Conditions to Obligations of the Company |
75 | ||||
Section 7.4 |
Frustration of Closing Conditions |
76 | ||||
ARTICLE VIII CLOSING | 76 | |||||
Section 8.1 |
Closing |
76 | ||||
Section 8.2 |
Company Closing Deliveries |
77 | ||||
Section 8.3 |
Purchaser Closing Deliveries |
77 | ||||
ARTICLE IX TERMINATION | 78 | |||||
Section 9.1 |
Termination |
78 | ||||
Section 9.2 |
Procedures and Effect of Termination |
79 |
- iii -
TABLE OF CONTENTS
(continued)
Page | ||||||
ARTICLE X INDEMNIFICATION | 79 | |||||
Section 10.1 |
Stockholder Indemnification Obligation |
79 | ||||
Section 10.2 |
Indemnification Procedures |
80 | ||||
Section 10.3 |
Adjustment of the Merger Consideration |
81 | ||||
Section 10.4 |
No Circular Recovery |
81 | ||||
ARTICLE XI MISCELLANEOUS PROVISIONS | 81 | |||||
Section 11.1 |
No Survival |
81 | ||||
Section 11.2 |
Notices |
81 | ||||
Section 11.3 |
Assignment; Successors in Interest |
82 | ||||
Section 11.4 |
Governing Law |
83 | ||||
Section 11.5 |
Submission to Jurisdiction |
83 | ||||
Section 11.6 |
Waiver of Jury Trial |
84 | ||||
Section 11.7 |
Severability |
84 | ||||
Section 11.8 |
Counterparts |
84 | ||||
Section 11.9 |
Parties in Interest |
84 | ||||
Section 11.10 |
Amendment, Modification and Waiver |
85 | ||||
Section 11.11 |
Integration |
85 | ||||
Section 11.12 |
Cooperation Following the Closing |
85 | ||||
Section 11.13 |
Time is of the Essence |
85 | ||||
Section 11.14 |
Transaction Costs |
85 | ||||
Section 11.15 |
Stockholder Representative |
86 | ||||
Section 11.16 |
Concerning the Companys Counsel; Attorney Client Privilege |
87 | ||||
Section 11.17 |
Specific Performance |
89 | ||||
Section 11.18 |
Non-Recourse |
89 |
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LIST OF EXHIBITS
Exhibit 1.1(a) |
Closing Date Net Working Capital | |
Exhibit 1.1(b) |
Company Severance Obligation Employees | |
Exhibit 1.1(c) |
Continuing Transition Employees | |
Exhibit 2.3(i) |
Amended and Restated Certificate of Incorporation of the Surviving Corporation | |
Exhibit 2.3(ii) |
Amended and Restated Bylaws of the Surviving Corporation | |
Exhibit 6.17 |
Forms of Confidential Transition Agreements | |
Exhibit 8.2(h) |
Form of Non-Solicitation Agreement | |
Exhibit 8.2(i) |
Form of Majority Stockholder Release |
LIST OF ANNEXES
Annex A |
Form of DMS Purchase Agreement | |
Annex B |
Form of Transition Services Agreement |
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AGREEMENT AND PLAN OF MERGER
This AGREEMENT AND PLAN OF MERGER (this Agreement), dated as of February 20, 2017, is made and entered into by and among NORDSON CORPORATION, an Ohio corporation (the Purchaser), VIKING MERGER CORP., a Delaware corporation (Merger Sub), VENTION MEDICAL HOLDINGS, INC., a Delaware corporation (the Company), and VMHI REP SERVICES, LLC, a Delaware limited liability company, solely in its capacity as Stockholder Representative hereunder. The Purchaser, Merger Sub, the Company and the Stockholder Representative are sometimes individually referred to herein as a Party and collectively as the Parties.
W I T N E S S E T H:
WHEREAS, the Parties desire to enter into this Agreement pursuant to which the Parties propose that Merger Sub, a wholly owned subsidiary of the Purchaser, will merge with and into the Company (the Merger) so that the Company will continue as the surviving corporation of the Merger and will become a wholly owned subsidiary of the Purchaser;
WHEREAS, the respective boards of directors of (1) Merger Sub and the Company have each unanimously (a) determined that it is in the best interests of their respective stockholders for the Merger Sub to merge with the Company on the terms and subject to the conditions set forth herein, (b) approved and declared advisable the Merger, this Agreement and the other transactions contemplated hereby and (2) the Purchaser, Merger Sub and the Company have each unanimously adopted this Agreement and approved the execution, delivery and performance of this Agreement and the consummation of the transactions contemplated hereby;
WHEREAS, the board of directors of the Company has unanimously approved and declared advisable the DMS Transaction;
WHEREAS, concurrently with the execution and delivery of this Agreement and as a condition and inducement to the willingness of the Purchaser to enter into this Agreement, the Company and MP Services, Inc. (the DMS Buyer) are executing and delivering a stock purchase agreement in the form attached as Annex A (as it may be amended from time to time in accordance with its terms and the terms of this Agreement, the DMS Purchase Agreement), pursuant to the terms and subject to the conditions of which, prior to the Effective Time, the Company will sell and transfer to the DMS Buyer the stock of the DMS Entities; and
WHEREAS, immediately following the execution of this Agreement, the Company shall obtain the Company Stockholder Approval (as defined below) in accordance with this Agreement, the DGCL (as defined below) and the Companys Certificate of Incorporation, Bylaws and Stockholders Agreement (each as defined below) for the adoption and approval of the Merger, this Agreement and the transactions contemplated hereby.
NOW, THEREFORE, in consideration of the premises and of the mutual representations, warranties, covenants and agreements contained in this Agreement, and for other good and valuable consideration (the receipt and sufficiency of which are hereby acknowledged), the Parties hereto, intending to be legally bound hereby, agree as follows:
ARTICLE I
DEFINITIONS; CONSTRUCTION
Section 1.1 Definitions. The following terms, as used herein, have the following meanings:
Affiliate of any specified Person means any other Person directly or indirectly Controlling or Controlled by or under direct or indirect common Control with such specified Person; provided, however, that for purposes of this Agreement (except, prior to the consummation of the DMS Transaction, with respect to ARTICLE IV and ARTICLE VI of this Agreement), the DMS Entities shall not be deemed Affiliates of either the Company or its Subsidiaries for any period prior to the Closing Date; provided, that in no circumstances shall the DMS Entities constitute subsidiaries for any purpose under ARTICLE VII (including, for the avoidance of doubt, by reference in ARTICLE VII to ARTICLE IV).
Aggregate Common Proceeds means an amount equal to (a)(i) the Per Share Cash Consideration, multiplied by (ii) the total number of shares of Common Stock outstanding immediately prior to the Effective Time (excluding any shares held as treasury stock, if any) less (b) Stockholder Loan Amount.
Aggregate Holder Proceeds means an amount equal to (a) the Cash Consideration, minus (b) the Aggregate Preferred Redemption Amount, plus (c) the Aggregate Option Exercise Price, plus (d) the Stockholder Loan Amount.
Aggregate Option Exercise Price means the aggregate exercise price that would be payable by all Option Holders if all In The Money Options outstanding immediately prior to the Effective Time were exercised in full immediately prior to the Effective Time.
Aggregate Preferred Redemption Amount means an amount equal to the sum of the Aggregate Series A-1 Preferred Redemption Amount, the Aggregate Series A-2 Preferred Redemption Amount, the Aggregate Series A-3 Preferred Redemption Amount, the Aggregate Series A-4 Preferred Redemption Amount, the Aggregate Series A-5 Preferred Redemption Amount, the Aggregate Series C-1 Preferred Redemption Amount and the Aggregate Series B-1 Preferred Redemption Amount.
Aggregate Series A-1 Preferred Redemption Amount means the aggregate cash amount required to redeem in full and in cash all Series A-1 Preferred Stock (including all accrued but unpaid dividends, premiums and penalties, if any, thereon or related thereto) as of the Effective Time pursuant to the Certificate of Incorporation.
Aggregate Series A-2 Preferred Redemption Amount means the aggregate cash amount required to redeem in full and in cash all Series A-2 Preferred Stock (including all accrued but unpaid dividends, premiums and penalties, if any, thereon or related thereto) as of the Effective Time pursuant to the Certificate of Incorporation.
Aggregate Series A-3 Preferred Redemption Amount means the aggregate cash amount required to redeem in full and in cash all Series A-3 Preferred Stock (including all accrued but
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unpaid dividends, premiums and penalties, if any, thereon or related thereto) as of the Effective Time pursuant to the Certificate of Incorporation.
Aggregate Series A-4 Preferred Redemption Amount means the aggregate cash amount required to redeem in full and in cash all Series A-4 Preferred Stock (including all accrued but unpaid dividends, premiums and penalties, if any, thereon or related thereto) as of the Effective Time pursuant to the Certificate of Incorporation.
Aggregate Series A-5 Preferred Redemption Amount means the aggregate cash amount required to redeem in full and in cash all Series A-5 Preferred Stock (including all accrued but unpaid dividends, premiums and penalties, if any, thereon or related thereto) as of the Effective Time pursuant to the Certificate of Incorporation.
Aggregate Series B-1 Preferred Redemption Amount means the aggregate cash amount required to redeem in full and in cash all Series B-1 Preferred Stock as of the Effective Time pursuant to the Certificate of Incorporation.
Aggregate Series C-1 Preferred Redemption Amount means the aggregate cash amount required to redeem in full and in cash all Series C-1 Preferred Stock (including all accrued but unpaid dividends, premiums and penalties, if any, thereon or related thereto) as of the Effective Time pursuant to the Certificate of Incorporation.
Anti-Corruption Laws means all Laws concerning or relating to bribery or corruption.
AT Business means the Companys (a) device design and engineering business and (b) advanced components business, in each case, whether operated through the Company or its Subsidiaries (excluding the DMS Entities).
AT Financial Information means (i) each trial balance for each entity comprising the AT Business for each month from July 1, 2014 through September 30, 2016, and (ii) the schedule of corporate allocations to the AT Business provided to Purchaser prior to the date hereof.
Balance Sheet means the unaudited consolidated balance sheet of the Company, its Subsidiaries and the DMS Entities as of December 31, 2016.
Business Day means any day except Saturday, Sunday or any day on which banks are generally not open for business in the state of Delaware.
Bylaws means the Bylaws of the Company (formerly known as MedTech Group Holdings, Inc.), adopted as of May 1, 2008, as amended by Amendment No. 1 to Bylaws of MedTech Group Holdings, Inc., dated December 18, 2008, as further amended by Amendment No. 2 to Bylaws of MedTech Group Holdings, Inc., dated January 30, 2011, as further amended by Amendment No. 3 to Bylaws of Vention Medical, Inc., undated, and as further amended by Amendment No. 4 to Bylaws of Vention Medical Holdings, Inc., undated.
Cash means the aggregate amount of cash or cash equivalents (including marketable securities) on hand or held in deposit, checking, money market or other similar accounts by or
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for the benefit of the Company or any of its Subsidiaries, as determined in accordance with GAAP, provided that Cash shall be (a) reduced by the aggregate amount of checks or drafts written by the Company or any of its Subsidiaries that remain outstanding and (b) increased by the amount of checks and drafts received but not yet posted by the Company or any of its Subsidiaries.
Cash Deficit means the amount, if any, by which the Closing Cash is less than the Estimated Closing Cash.
Cash Surplus means the amount, if any, by which the Closing Cash is greater than the Estimated Closing Cash.
Certificate of Incorporation means the Fifth Amended and Restated Certificate of Incorporation of the Company (formerly known as MedTech Group Holdings, Inc.), adopted as of October 28, 2013.
Closing means the consummation of the transactions contemplated by this Agreement, as set forth in ARTICLE VIII of this Agreement.
Closing Cash means Cash as of 11:59 p.m. Central Time on the date immediately preceding the Closing Date, provided that Closing Cash shall be deemed to exclude any amount agreed to be paid prior to the Effective Time to any holder of Dissenting Shares in respect of any settlement.
Closing Date Indebtedness means all Indebtedness of the Company and any of its Subsidiaries, as of immediately prior to the Effective Time on the Closing Date.
Closing Date Net Working Capital means the current assets of the Company and its Subsidiaries on a consolidated basis (not including Closing Cash or assets related to income Taxes) less the current liabilities of the Company and its Subsidiaries on a consolidated basis (not including (a) any of the amounts paid pursuant to Section 3.5 of this Agreement or (b) the current portion of any amounts included in Closing Date Indebtedness (or any accrued interest, deferred issuance costs or prepayment penalties with respect to Closing Date Indebtedness, only to the extent included within Closing Date Indebtedness)) as of 11:59 p.m. Central Time on the date immediately preceding the Closing Date, in each case (i) to the extent included as line items in the sample calculation set forth in Exhibit 1.1(a)(i), and (ii) calculated in accordance with the accounting methods, policies, principles, practices, procedures, classifications and estimation methodologies (whether with regard to reserves or otherwise) specified in Exhibit 1.1(a)(ii), which were used in connection with the preparation of the sample calculation set forth in Exhibit 1.1(a)(i), which was prepared as if the Closing occurred as of November 30, 2016 (i.e., calculated for the close of business on November 30, 2016).
COBRA means the Consolidated Omnibus Budget Reconciliation Act of 1985.
Code means the United States Internal Revenue Code of 1986.
Common Stock means Voting Common Stock and Non-Voting Common Stock.
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Common Stockholder means any holder of Common Stock outstanding immediately prior to the Effective Time.
Company Ancillary Documents means any certificate or agreement, other than this Agreement, to be executed and delivered by the Company in connection with the transactions contemplated hereby. Notwithstanding the foregoing, Company Ancillary Documents shall not include any documents executed and delivered by the Company (or any of its Subsidiaries or the DMS Entities) solely in connection with (a) the Purchasers or Merger Subs financing for the transactions contemplated hereby or (b) the DMS Transaction.
Company Benefit Plan means each Employee Benefit Plan sponsored or maintained by the Company, any of its Subsidiaries or any member of their respective Controlled Groups, for the benefit of any current or former employees, directors, managers, officers, consultants, independent contractors, contingent workers or leased employees (or the dependents or beneficiaries if any of them) of the Company or any of its Subsidiaries and pursuant to which there remains any outstanding liability or obligation.
Company Incentive Plan means the Vention Medical, Inc. Amended and Restated 2008 Stock Incentive Plan, as amended on July 1, 2013 and May 30, 2014.
Company Intellectual Property means any Intellectual Property that is owned, or purported to be owned, by or licensed to the Company or any of its Subsidiaries, including the Company Software.
Company Licensed Software means all Software (other than Company Proprietary Software) used by the Company or any of its Subsidiaries.
Company Proprietary Software means all Software owned, or purported to be owned, by the Company or any of its Subsidiaries.
Company Registered Intellectual Property means all Registered Intellectual Property owned, or purported to be owned, by or filed in the name of the Company or any of its Subsidiaries.
Company Software means the Company Licensed Software and the Company Proprietary Software.
Company Stock means the Common Stock, the Series A Preferred Stock, Series B-1 Preferred Stock and the Series C-1 Preferred Stock.
Confidential Information means any data or information of the Company, any of its Subsidiaries or any of the DMS Entities (including trade secrets) that is valuable to the operation of the Companys or any of its Subsidiaries or the DMS Entities business and not generally known to the public or competitors.
Continuing Transition Employee Compensation means $1,147,992, which is the estimated amount of compensation, as agreed between the Parties, payable to those employees set forth on Exhibit 1.1(c) in respect of the six (6) month period from and after the Closing Date.
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Contract means any written or oral contract, agreement, arrangement, commitment, note, bond, mortgage, lease, sublease, license or other agreement legally binding agreement.
Control, Controlled and Controlling mean, when used with respect to any specified Person, the power to direct the management and policies of such Person, directly or indirectly, whether through the ownership of voting securities, by Contract or otherwise.
Controlled Group means any trade or business (whether or not incorporated) (i) under common control within the meaning of Section 4001(b)(1) of ERISA with any Person, or (ii) which, together with any Person, is treated as a single employer under Section 414 of the Code.
Credit Agreement means the Second Amended and Restated Credit Agreement, dated as of December 10, 2014, by and among Vention Medical, Inc., a New Jersey corporation, and Vention Medical Advanced Components, Inc., a New Hampshire corporation, the lenders from time to time party thereto and Madison Capital Funding LLC, as agent for the lenders party thereto.
Customers means the ten (10) largest customers of the Company and its Subsidiaries (excluding the DMS Entities) in terms of revenues for the twelve (12) month period ended June 30, 2016.
Damages means all assessments, levies, awards, judgments, losses, fines, penalties, damages, amounts paid in settlement, costs and expenses, including reasonable attorneys fees and expenses incurred in investigating or defending any claim.
DGCL means the Delaware General Corporation Law.
Disclosure Schedule means the disclosure schedule delivered by the Company to the Purchaser and Merger Sub simultaneously with the execution of this Agreement.
DMS Entities means each of VMI, Vention Medical Puerto Rico, Inc., a corporation organized under the laws of Puerto Rico, and Vention Medical Costa Rica, S.A., a company organized under the laws of Costa Rica.
Employee Benefit Plan means (a) any plan, fund, program, policy, agreement, arrangement or scheme, including each plan, fund, program, policy, agreement, arrangement or scheme maintained or required to be maintained under the Laws of a jurisdiction outside the United States of America, pursuant to which a Person has sponsored, maintained or contributed to (or been required to contribute to) compensation or benefits (other than salary or base hourly wages) for services rendered by employees, former employees, directors, managers, officers, consultants, independent contractors, contingent workers or leased employees or the dependents of any of them (whether written or oral), including sick leave, paid-time off, vacation pay, severance pay, long term or short term disability, or other compensation arrangements, qualified or non-qualified retirement, deferred compensation, bonus, retention, change in control, excess benefit plan, top hat plan, incentive compensation, stock purchase, stock option, stock unit, restricted stock, equity or equity-based award, health (including hospitalization), medical and dental, life insurance, tuition and scholarship programs, (b) any plan, program or policy described in Section 3(3) of ERISA (as determined without regard to whether such plan, program
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or policy is subject to ERISA) sponsored, maintained or contributed to by a Person, (c) any agreements or other arrangements pursuant to which a Person has sponsored, maintained or contributed to benefits upon a termination of employment or upon a change in control of a Person and (d) any Employment Agreement, but excluding, in all cases, statutory arrangements where the obligations of a Person is to make contributions to a Government Entity, such as U.S social security benefits.
Employment Agreement means any employment contract, consulting agreement, termination or severance agreement, change of control agreement, non-compete agreement or any other agreement respecting the terms and conditions of employment or payment of compensation, or of a consulting or independent contractor relationship, in respect of any current or former officer, employee, consultant or independent contractor, excluding any such agreements pursuant to which the Company may terminate the employment or services relationship upon not more than ninety (90) days notice and pursuant to which no severance upon termination of employment or the services relationship is due.
Enterprise Value means $705,000,000.
Environmental Laws means all applicable Laws relating to protection of human health or safety (with respect to Hazardous Materials) or of the environment, including Laws related to the protection of surface or ground water, drinking water supply, soil, surface or subsurface strata or medium, or ambient or indoor air, pollution control and Hazardous Materials.
ERISA means the United States Employee Retirement Income Security Act of 1974.
Escrow Agent means Wilmington Trust, N.A.
Escrow Agreement means the Escrow Agreement in a form mutually agreed to by the Purchaser, the Seller and the Escrow Agent prior to the Closing.
Estimated Working Capital Deficit means the amount, if any, that the Estimated Closing Date Net Working Capital is less than the Target Net Working Capital.
Estimated Working Capital Surplus means the amount, if any, that the Estimated Closing Date Net Working Capital is greater than the Target Net Working Capital.
Expense Overpayment means the amount, if any, that the Estimated Transaction Expenses paid by the Purchaser at Closing pursuant to Section 3.5(c) exceeds the Transaction Expenses.
Expense Underpayment means the amount, if any, that the Estimated Transaction Expenses paid by the Purchaser at Closing pursuant to Section 3.5(c) is less than the Transaction Expenses.
FDA Law means all Laws administered or issued by the FDA.
Final Closing Statement means the Proposed Closing Statement as finally determined in accordance with Section 3.6 of this Agreement.
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Final Shortfall means the amount, if any, by which (a) the sum of (i) the Working Capital Deficit, if any, (ii) the Cash Deficit, if any, and (iii) the Expense Underpayment, if any, exceeds (b) the sum of (i) the Working Capital Surplus, if any, (ii) the Cash Surplus, if any, and (iii) the Expense Overpayment, if any.
Final Surplus means the amount, if any, by which (a) the sum of (i) the Working Capital Surplus, if any, (ii) the Cash Surplus, if any, and (iii) the Expense Overpayment, if any, exceeds (b) the sum of (i) the Working Capital Deficit, if any, and (ii) the Cash Deficit, if any, and (iii) the Expense Underpayment, if any.
Financial Statements means (a) the audited consolidated balance sheets of the Company, its applicable Subsidiaries and the applicable DMS Entities as of June 30, 2016 and June 30, 2015 and the audited consolidated statements of comprehensive income, stockholders equity and cash flows of the Company, its applicable Subsidiaries and the applicable DMS Entities as of such dates for the years then ended, and (b) the Balance Sheet and the unaudited consolidated income statement of the Company, its Subsidiaries and the DMS Entities for the six (6) month period ended December 31, 2016.
Fully Diluted Shares means an amount equal to the sum of (a) the total number of shares of Common Stock outstanding immediately prior to the Effective Time (excluding any shares held as treasury stock, if any), plus (b) the total number of shares of Common Stock that could be obtained through the exercise of all In The Money Options outstanding immediately prior to the Effective Time upon payment in full with cash in the amount of the Aggregate Option Exercise Price.
GAAP means United States generally accepted accounting principles, as have been historically applied by the Company and its Subsidiaries.
Good Manufacturing Practices means standards and methods to be used in, and the facilities or controls to be used for, the manufacture, processing, packaging, testing or holding of any product, pursuant to the requirements of Law, including to assure that any product meets the requirements of applicable Law and other requirements of any Governmental Entity; for purposes of this Agreement, Good Manufacturing Practices shall include FDAs Quality System Regulations, codified at 21 C.F.R. Part 820.
Governmental Entity means any federal, state or local or foreign government, any political subdivision thereof or any court, administrative or regulatory agency, department, instrumentality, ministry, body or commission or other governmental authority or agency, domestic or foreign.
Hazardous Materials means any hazardous, toxic or special waste, hazardous substance, toxic, ignitable, reactive or corrosive substance, petroleum or petroleum-derived substance or waste, or any constituent of any such substance or waste, the use, handling or disposal of which by the Company or any of its Subsidiaries is in any way governed by or subject to any Environmental Law.
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Holder means any Common Stockholder and any Option Holder.
HSR Act means the United States Hart-Scott-Rodino Antitrust Improvements Act of 1976.
In The Money Options means Options outstanding immediately prior to the Effective Time with a per share exercise price that is less than the Per Share Cash Consideration.
Indebtedness means with respect to any Person (i) all indebtedness for borrowed money, (ii) any accrued or unpaid interest on and any prepayment premiums, penalties or similar contractual charges in respect to any Indebtedness, (iii) any liability evidenced by a bond, note, debenture or similar instrument (including a purchase money obligation), (iv) any liability for the payment of money relating to leases that are required to be classified as a capitalized lease obligation in accordance with GAAP, (v) any liability, other than the liability in respect of the Lithotech Earnout Payment, for all or any part of the deferred purchase price of property or services (other than trade payables, only to the extent included in the calculation of Closing Date Net Working Capital), including any earnout, holdback or similar payments, (vi) any liability under interest rate swap, hedging or similar agreements and (vii) any liability for dividends payable on preferred stock. Indebtedness will also include any liability of others described in clauses (i) through (vii) above that any Person has guaranteed, that is recourse to such Person or any of its assets or that is otherwise its legal liability or that is secured in whole or in part by the assets of such Person. For the avoidance of doubt, Indebtedness shall not include any payables or loans of any kind or nature between or among the Company and its wholly owned Subsidiaries.
Intellectual Property means all intellectual property rights, whether foreign or domestic, including: (a) all patents and applications therefor and all reissues, divisions, renewals, extensions, provisionals, continuations and continuations-in-part thereof; (b) all inventions (whether patentable or not), invention disclosures, improvements, mask works, trade secrets, manufacturing processes, test and qualification processes, designs, schematics, proprietary information, know-how, technology and technical data, and all documentation to the extent embodying any of the foregoing; (c) all works of authorship (whether copyrightable or not), copyrights, copyright registrations and applications therefor; (d) all industrial designs and any registrations and applications therefor; (e) all Software; (f) all internet uniform resource locators, domain names, trade names, logos, slogans, designs, trade dress, common law trademarks and service marks, trademark and service mark and trade dress registrations and applications therefor; and (g) all databases and data collections and all rights therein.
Intercompany Note means the Amended and Restated Intercompany Note which evidences the loans by and among the Subsidiaries of the Company.
IRS means the United States Internal Revenue Service.
Knowledge means (a) with respect to the Company means all facts actually known by any of Daniel C. Croteau, Anthony M. Gilarde, Jr., Thomas B. Testa, Tricia Albert, Bill Flaherty and Steven Robertson and (b) with respect to the Purchaser means all facts actually known by any of Jeff Pembroke and Anne Pombier.
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Labor Laws means all Laws and all Contracts or collective bargaining agreements governing or concerning labor relations, unions and collective bargaining, conditions of employment, employment discrimination and harassment, immigration, wages, hours or occupational safety and health.
Laws means all laws (including common law), statutes, rules, codes, regulations, restrictions, ordinances, orders, decrees, approvals, directives, judgments, injunctions, writs, awards and decrees of, or issued by, any Governmental Entity.
Leased Real Property means those parcels of real property or portions thereof which the Company or any of its Subsidiaries leases, subleases, licenses or otherwise has the right to use (together with those fixtures and improvements thereon which are included in the terms of the leases therefor).
Licenses means all notifications, licenses, permits (including environmental, construction and operation permits), franchises, certificates, approvals, exemptions, classifications, registrations and other similar documents and authorizations issued by any Governmental Entity, and applications therefor.
Liens mean all mortgages, liens, pledges, security interests, charges and encumbrances of any nature whatsoever.
Lithotech Agreement means the Share Purchase Agreement, dated December 14, 2016, by and among Lithotech Medical Ltd., an Israeli company and a wholly-owned indirect subsidiary of the Company, N.S.B.M.2016 LTD., an Israeli company, as the selling shareholders representative, Vention Medical Israel Ltd., an Israeli company, and the selling shareholders thereunder.
Lithotech Earnout Date means (a) with respect to Undisputed Earn-Out Amounts (as defined in the Lithotech Agreement), the date that is 3 Business Days after the applicable Earn-Out Statement, and (b) in the event a Response (as defined in the Lithotech Agreement) disputes any amount in the Earn-Out Statement (as defined in the Lithotech Agreement), the date that is 3 Business Days following final determination of the dispute in accordance with the terms of the Lithotech Agreement.
Lithotech Earnout Payment means (a) any Undisputed Earn-Out Amount (as defined in the Lithotech Agreement) and (b) the amount, if any, that has been finally determined to be payable by Vention Medical Israel Ltd., an Israeli company and a wholly-owned indirect subsidiary of the Company, with respect to any disputed amount in the Earn-Out Statement (as defined in the Lithotech Agreement), in the case of clauses (a) and (b), pursuant to the Lithotech Agreement in respect of the Second Earn-Out Installment (as such term is defined in the Lithotech Agreement).
Material Adverse Effect means any effect, event, development or change that is or would reasonably be expected to be materially adverse to the assets, business, results of operations or financial condition of the AT Business, taken as a whole, other than any effect, event, development or change to the extent arising out of or resulting from: (a) changes in
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conditions in the U.S. or global economy, capital, financial or credit markets generally, including changes in interest or exchange rates, (b) changes in legal, tax, regulatory, political or business conditions that, in any case, affect the geographic regions or industries in which the Company and its Subsidiaries conduct their business, (c) changes in Law or GAAP or the enforcement or authoritative interpretations thereof, (d) the announcement of this Agreement or the transactions contemplated by this Agreement, including the impact thereof on relationships, contractual or otherwise, with customers, suppliers, distributors, landlords, tenants, lenders or employees, (e) the failure of the Company or its Subsidiaries to meet any internal projections or forecasts, (f) acts of war, armed hostilities, sabotage or terrorism, or any escalation or worsening of any acts of war, armed hostilities, sabotage or terrorism, (g) earthquakes, hurricanes or other natural disasters, (h) the identity of the Purchaser or its Affiliates or any effect resulting from any statement made by the Purchaser or any of its respective Affiliates concerning the Company, or any employees, customers or suppliers of the Company, or (i) any action expressly required to be taken by the Company or its Subsidiaries pursuant to this Agreement (other than the obligations set forth in Section 6.1(a)), in connection with the transactions contemplated by this Agreement or at the request, or with the consent, of the Purchaser except, in the case of clauses (a), (b), (c), (f) and (g), to the extent such effect, event, development or change affects the Company and its Subsidiaries in a materially disproportionate manner as compared to other Persons operating in the industries in which the Company and its Subsidiaries compete.
Merger Consideration means the Cash Consideration and all other amounts the Stockholders are entitled to receive pursuant to Section 3.3.
Non-Voting Common Stock means the Companys Non-Voting Common Stock, $0.001 par value per share.
Option Holder means a holder of an Option outstanding immediately prior to the Effective Time.
Option Holder Cash Consideration means an amount equal to (a) the Per Option Cash Consideration, multiplied by (b) the total number of In The Money Options.
Options means all options to purchase Non-Voting Common Stock issued pursuant to the Company Incentive Plan.
Ordinary Course means the ordinary course of business consistent with past practice of the Company and its Subsidiaries.
Paying Agent means Wilmington Trust, N.A.
Paying Agent Agreement means the Paying Agent Agreement entered into among the Paying Agent, the Purchaser and the Stockholder Representative on the Closing Date.
Per Option Cash Consideration means, with respect to each Option, an amount equal to (a) the amount, if any, by which (i) the Per Share Cash Consideration exceeds (ii) the per share exercise price of such Option multiplied by (b) the number of shares of Non-Voting Common Stock for which such Option is exercisable into immediately prior to the Effective Time pursuant
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to the Company Incentive Plan, with the aggregate amount of such consideration rounded to the nearest cent.
Per Series A-1 Preferred Share Redemption Amount means an amount equal to the Series A-1 Liquidation Value per share as defined in the Certificate of Incorporation.
Per Series A-2 Preferred Share Redemption Amount means an amount equal to the Series A-2 Liquidation Value per share as defined in the Certificate of Incorporation.
Per Series A-3 Preferred Share Redemption Amount means an amount equal to the Series A-3 Liquidation Value per share as defined in the Certificate of Incorporation.
Per Series A-4 Preferred Share Redemption Amount means an amount equal to the Series A-4 Liquidation Value per share as defined in the Certificate of Incorporation.
Per Series A-5 Preferred Share Redemption Amount means an amount equal to the Series A-5 Liquidation Value per share as defined in the Certificate of Incorporation.
Per Series B-1 Preferred Share Redemption Amount means an amount equal to the Series B-1 Original Preferred Issue Price as defined in the Certificate of Incorporation.
Per Series C-1 Preferred Share Redemption Amount means an amount equal to the Series C-1 Liquidation Value per share as defined in the Certificate of Incorporation
Per Share Cash Consideration means an amount equal to (a) Aggregate Holder Proceeds divided by (b) the total number of Fully Diluted Shares.
Permitted Liens means (a) Liens for Taxes not yet due and payable or being contested in good faith by appropriate proceedings and for which adequate reserves have been established in accordance with GAAP, (b) statutory Liens of landlords with respect to Real Property, (c) Liens of carriers, warehousemen, mechanics, materialmen and repairmen incurred in the Ordinary Course and not yet delinquent or being contested in good faith by appropriate proceedings and for which adequate reserves have been established in accordance with GAAP, (d) in the case of Real Property, zoning, building or other restrictions and variances (to the extent such are not violated), (e) in the case of Real Property, covenants, rights of way, encumbrances, easements and other minor irregularities in title, none of which, individually or in the aggregate, interfere in any material respect with the present use or occupancy of the affected parcel by the Company or any of its Subsidiaries, (f) prior to Closing, Liens securing the Closing Date Indebtedness (which Liens shall be terminated upon payment in full of such Closing Date Indebtedness), (g) in the case of Intellectual Property, non-exclusive third party license agreements entered into in the Ordinary Course in connection with the sale of goods and services and (h) the replacement, extension or renewal of any of the foregoing.
Person means, any individual, corporation, partnership, joint venture, limited liability company, trust, unincorporated organization, other entity or Governmental Entity.
Post-Closing Period means any taxable period beginning after the Closing Date, and the portion of any Straddle Period beginning on the day after the Closing Date.
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Pre-Closing Periods means any taxable period ending on or before the Closing Date and, with respect to any Straddle Period, the portion of such Straddle Period that ends on and includes the Closing Date.
Pro Rata Percentage means, for each Holder, the percentage obtained by dividing (a) the total number of Fully Diluted Shares held by such Holder immediately prior to the Effective Time by (b) the total number of Fully Diluted Shares.
Purchaser Ancillary Documents means any certificate or agreement, other than this Agreement, to be executed and delivered by the Purchaser or Merger Sub in connection with the transactions contemplated hereby.
Quality System Regulations means the codification of Good Manufacturing Practices for medical devices by the FDA as set forth in 21 C.F.R. Part 820.
Real Property means the Owned Real Property and the Leased Real Property.
Registered Intellectual Property means all United States and foreign: (a) patents and patent applications (including provisional applications); (b) registered trademarks and service marks, applications to register trademarks and service marks, registered and applications to register trade dress, intent-to-use trademark or service mark applications or other registrations or applications for trademarks and service marks and trade dress; (c) registered copyrights and applications for copyright registration; and (d) domain name registrations.
Release means, with respect to any Hazardous Material, any spilling, leaking, pumping, pouring, emitting, emptying, discharging, injecting, escaping, dumping or disposing into any surface or ground water, drinking water supply, soil, surface or subsurface strata or medium, or the ambient air.
Sanctioned Country means, at any time, a region, country or territory which is itself the subject or target of any Sanctions (which includes, at the time of this Agreement, Crimea, Cuba, Iran, North Korea, Sudan and Syria).
Sanctioned Person means, at any time, (a) any Person listed in any Sanctions-related list of designated Persons maintained by the Office of Foreign Assets Control of the U.S. Department of the Treasury, the U.S. Department of State or by the United Nations Security Council, the European Union or any European Union member state, (b) any Person operating, organized or resident in a Sanctioned Country or (c) any Person owned or controlled by any such Person(s) described in the foregoing clauses (a) or (b).
Sanctions means economic or financial sanctions or trade embargoes imposed, administered or enforced from time to time by (a) the U.S. government, including those administered by the Office of Foreign Assets Control of the U.S. Department of the Treasury or the U.S. Department of State, or (b) the United Nations Security Council, the European Union, any European Union member state or Her Majestys Treasury of the United Kingdom.
Series A Preferred Stock means the Series A-1 Preferred Stock, Series A-2 Preferred Stock, Series A-3 Preferred Stock, Series A-4 Preferred Stock and Series A-5 Preferred Stock.
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Series A-1 Preferred Stock means the shares of the Company designated Series A-1 Redeemable Preferred in the Certificate of Incorporation, $0.001 par value per share.
Series A-2 Preferred Stock means the shares of the Company designated Series A-2 Redeemable Preferred in the Certificate of Incorporation, $0.001 par value per share.
Series A-3 Preferred Stock means the shares of the Company designated Series A-3 Redeemable Preferred in the Certificate of Incorporation, $0.001 par value per share.
Series A-4 Preferred Stock means the shares of the Company designated Series A-4 Redeemable Preferred in the Certificate of Incorporation, $0.001 par value per share.
Series A-5 Preferred Stock means the shares of the Company designated Series A-5 Redeemable Preferred in the Certificate of Incorporation, $0.001 par value per share.
Series B-1 Preferred Stock means the shares of the Company designated Series B-1 Contingent Preferred in the Certificate of Incorporation, $0.001 par value per share, including the Converted Stock Unit B-1 Shares.
Series C-1 Preferred Stock means the shares of the Company designated Series C-1 Redeemable Preferred in the Certificate of Incorporation, $0.001 par value per share.
Severance Costs means $3,775,867, which is the estimated amount of the costs, as agreed between the Parties, related to severance obligations of the Company for the employees set forth on Exhibit 1.1(b).
Software means all computer software programs, together with any error corrections, updates, modifications or enhancements thereto, in both machine-readable form and human-readable form.
Stock Unit shall have the meaning ascribed thereto in the Company Incentive Plan.
Stock Unit Holder means any holder of a Stock Unit.
Stockholder means any holder of Series A Preferred Stock, Series B-1 Preferred Stock or Series C-1 Preferred Stock, any Common Stockholder and any Option Holder.
Stockholder Loan Amount means the aggregate amount due and payable to the Company by each Stockholder Loan Party, pursuant to a loan document with such Stockholder Loan Party, as of the Effective Time.
Stockholder Loan Party means each of Dan Croteau and Thomas B. Testa.
Stockholders Agreement means the Amended and Restated Stockholders Agreement, made effective as of June 30, 2010, by the Company (formerly MedTech Group Holdings, Inc.), George Blank and the holders of a majority of the issued and outstanding Voting Common Stock (as defined therein) of the Company, by and among the Company, KRG Capital Fund IV, L.P., KRG Capital Fund IV-A, L.P., KRG Capital Fund IV (FF), L.P., KRG Capital Fund IV (PA),
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L.P., KRG Co-Investment, L.L.C., the Co-Investor Stockholders (as defined therein) and the Management Stockholders (as defined therein) as amended August 19, 2011, November 10, 2011, July 1, 2013 and October 28, 2013.
Straddle Period means any taxable period beginning on or before the Closing Date and ending after the Closing Date.
Subsidiary means any Person, other than a DMS Entity, of which the Company (or any other specified Person) owns, directly or indirectly, whether through a Subsidiary, a DMS Entity, a nominee arrangement or otherwise, at least a majority of the outstanding capital stock (or other shares of beneficial interest) entitled to vote generally or otherwise has the power to elect a majority of the board of directors or similar governing body or the legal power to direct the business or policies of such Person; provided, however, that the DMS Entities will constitute Subsidiaries of the Company for purposes of ARTICLE IV (including, for the avoidance of doubt, in connection with defined terms used in ARTICLE IV but defined elsewhere in this Agreement); provided, that in no circumstances shall the DMS Entities constitute subsidiaries for any purpose under ARTICLE VII (including, for the avoidance of doubt, by reference in ARTICLE VII to ARTICLE IV).
Supplier means the top ten (10) suppliers of the Company and its Subsidiaries (excluding the DMS Entities) in terms of amounts paid to such Suppliers during the twelve (12)-month period ended June 30, 2016.
Target Net Working Capital means an amount equal to $22,049,123.
Tax Benefit means the net amount of any reduction in Tax for any Post-Closing Period of the Purchaser and its Affiliates (including, for all Post-Closing Periods, the Surviving Corporation and its Subsidiaries) attributable to the Transaction Tax Deductions or any net operating loss attributable to the Transaction Tax Deductions or any net operating loss otherwise existing as of the Effective Time as reflected on the Tax Returns prepared pursuant to Section 6.9(a), which reduction in Tax shall be calculated by measuring the difference between the amount of Taxes that would be due (without regard to payments or overpayments) to a Taxing Authority with respect to the Purchaser and its Affiliates without taking into account any Transaction Tax Deductions or any net operating loss attributable to the Transaction Tax Deductions or any net operating loss otherwise existing as of the Effective Time, and the amount of Taxes actually due (without regard to payments or overpayments) to a Taxing Authority with respect to the Purchaser and its Affiliates taking into account the deductions, credits, losses or other Tax attributes resulting from any Transaction Tax Deductions or any net operating loss otherwise existing as of the Effective Time as reflected on the Tax Returns prepared pursuant to Section 6.9(a), assuming that such deductions, credits, losses or other Tax attributes are the last item of deduction, credit, losses or other Tax attributes on any Tax Return.
Tax Return means any report, form, schedule, statement, return, declaration or other information required or permitted to be supplied to a Governmental Entity in connection with Taxes, including estimated returns, amended returns, supplements, claims for refund, elections, information statements and reports of every kind with respect to Taxes.
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Taxes means (a) all taxes, assessments, charges, customs, duties, fees, levies and other governmental charges, including income, franchise, capital stock, real property, personal property, tangible, withholding, employment, payroll, social security, social contribution, unemployment, disability, transfer, sales, use, excise, gross receipts, value-added, alternative or add-on minimum, ad valorem, escheat, unclaimed or abandoned property, profits, license, severance, stamp, occupation, premium, environmental, windfall profit and all other taxes of any kind for which the Company or any of its Subsidiaries may have any liability imposed by any Governmental Entity or Law, in each case, whether disputed or not, and any charges, interest, additions to tax or penalties imposed by any Governmental Entity or Law, (b) all liability for the payment of any amounts of any of the foregoing types as a result of being a member of an affiliated, consolidated, combined or unitary group, or being a party to any agreement or arrangement whereby liability for payment of such amounts was determined or taken into account with reference to the liability of any other Person, (c) all liability for the payment of any amounts as a result of being a party to any tax sharing or allocation agreements or arrangements (whether or not written) or with respect to the payment of any amounts of any of the foregoing types as a result of any express or implied obligation to indemnify any other Person, and (d) all liability for the payment of any of the foregoing types as a successor, transferee or otherwise.
Taxing Authority means any Governmental Entity responsible for the imposition, administration, determination, assessment, enforcement or collection of any Tax.
Transaction Expenses means, to the extent not paid prior to the Closing, (a) other than any Severance Costs, any sale bonuses, stay bonuses, change of control payments, severance payments, retention payments or other similar payments paid or payable (and not otherwise irrevocably waived or forfeited) to any Person by the Company or any of its Subsidiaries as a result of or in connection with the consummation of the transactions contemplated by this Agreement including the employer portion of any Taxes related to any such payment (but, for the avoidance of doubt, excluding any payments with respect to any Option and any such payment or amount the payment of which is subject to continued employment following the Closing or triggered by any post-Closing termination by the Surviving Corporation or any Affiliate thereof of any Persons employment or consulting relationship), (b) any legal, accounting, financial advisory and other third party advisory or consulting fees and other fees and expenses incurred by the Company or any of its Subsidiaries on or prior to the Closing in connection with the transactions contemplated by this Agreement, (c) any current management fees payable to KRG Capital Management L.P., (d) any incremental severance payments required to be paid to the extent exceeding the Severance Costs in the event that the releases set forth in Section 6.17(a) are not received prior to Closing, (e) any Damages resulting from not obtaining the transition agreements and releases contemplated by Section 6.17(b), including any incremental severance costs in excess of the Continuing Transition Employee Compensation and any costs and expenses incurred to replace the applicable employees services to be provided under the Transition Services Agreement, (f) any Damages incurred with respect to the matter identified on Section 6.19 of the Disclosure Schedules, and (g) any costs and expenses incurred in connection with the Business Separation (as defined in the DMS Purchase Agreement). Notwithstanding the foregoing, Transaction Expenses shall not include any fees or expenses incurred by the Company or its Subsidiaries in connection with the Purchasers or Merger Subs financing for the transaction contemplated hereby or any fees or expenses of or incurred at the written request of the Purchaser, Merger Sub or any of their respective Representatives.
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Transaction Tax Deductions means any deductions permitted under applicable Tax Law to the extent relating to, or arising from, (a) any Transaction Expenses; (b) any fees, expenses and interest (including amounts treated as interest for income Tax purposes and any breakage fees and accelerated deferred financing fees or debt prepayment fees or capitalized debt costs) incurred by the Company or any of its Subsidiaries with respect to the payment of any Closing Date Indebtedness; (c) payments with respect to the cancellation of any Options and any related employment Taxes or any exercise of Options between the date hereof and the Closing Date; (d) any sale bonuses, stay bonuses, change of control payments, severance payments, retention payments or other similar payments (and related employment Taxes) made by the Company or any of its Subsidiaries on or around the Closing Date (or otherwise incurred in connection with the transactions contemplated hereby) or that was included as a liability in the computation of the Closing Date Net Working Capital, as finally determined; and (e) the Severance Costs and the Continuing Transition Employee Compensation.
VMAC means Vention Medical Acquisition Co., a Delaware corporation.
Voting Common Stock means the Companys Voting Common Stock, $0.001 par value per share.
Working Capital Deficit means the amount, if any, by which the Closing Date Net Working Capital is less than the Estimated Closing Date Net Working Capital, as reflected on the Final Closing Statement.
Working Capital Surplus means the amount, if any, by which the Closing Date Net Working Capital is greater than the Estimated Closing Date Net Working Capital, as reflected on the Final Closing Statement.
Section 1.2 Other Defined Terms. Each of the following terms is defined in the Section set forth opposite such term:
Agreement |
Preamble | |
Arbitrator |
Section 3.6(d) | |
Canceled Shares |
Section 2.5(c) | |
Cash Consideration |
Section 3.1 | |
Certificate of Merger |
Section 2.1 | |
Certificates |
Section 2.6(a) | |
Claim |
Section 5.4(b) | |
Closing Date |
Section 8.1 | |
Closing Date Holder Payment Statement |
Section 3.2(b) | |
Company |
Preamble | |
Company Board Recommendation |
Section 4.2(b) | |
Company Contracts |
Section 4.13(a) | |
Company Stockholder Approval |
Section 4.2(b) | |
Confidentiality Agreement |
Section 6.2(b) | |
Converted Stock Unit B-1 Share Cash Consideration |
Section 3.3(b) | |
Converted Stock Unit B-1 Shares |
Section 2.5(a) |
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D&O Tail Premium |
Section 6.7(c) | |
Debt |
Section 5.4(b) | |
Direct Claim |
Section 10.2(b) | |
Dissenting Shares |
Section 2.5(d) | |
Dissenting Stockholder |
Section 2.5(d) | |
DMS Buyer |
Recitals | |
DMS Purchase Agreement |
Recitals | |
DMS Seller |
Section 6.14(a) | |
DMS Transaction |
Section 6.14(a) | |
Effective Time |
Section 2.1 | |
End Date |
Section 9.1(b) | |
Engagement |
Section 11.16(b) | |
Estimated Closing Cash |
Section 3.2(a) | |
Estimated Closing Date Net Working Capital |
Section 3.2(a) | |
Estimated Closing Statement |
Section 3.2(a) | |
Estimated Transaction Expenses |
Section 3.2(a) | |
Evaluation Period |
Section 3.6(b) | |
FDA |
Section 4.21(a) | |
Letter of Transmittal |
Section 2.6(a) | |
Lithotech Earnout Escrow Amount |
Section 3.1 | |
Lithotech Earnout Escrow Fund |
Section 3.4 | |
Merger |
Recitals | |
Merger Sub |
Preamble | |
Notice of Disagreement |
Section 3.6(b) | |
Owned Real Property |
Section 4.6 | |
Parties |
Preamble | |
Party |
Preamble | |
Payoff Letters |
Section 7.2(e) | |
Pre-Closing Period Tax Returns |
Section 6.9(a) | |
Present Fair Salable Value |
Section 5.4(b) | |
Prior Company Counsel |
Section 11.16(a) | |
Privilege Period |
Section 6.9(b) | |
Proposed Closing Statement |
Section 3.6(a) | |
Purchaser |
Preamble | |
Purchaser Indemnitee |
Section 10.1 | |
Representatives |
Section 6.2(a) | |
Securities Act |
Section 5.6 | |
Solvency |
Section 5.4(b) | |
Solvent |
Section 5.4(b) | |
Stockholder Approval Certificate |
Section 6.7 | |
Stockholder Cash Consideration |
Section 3.3(a) | |
Stockholder Representative |
Section 11.15(a) | |
Stockholder Representative Reserve |
Section 3.1 | |
Stockholder Vote |
Section 6.6 | |
Surviving Corporation |
Section 2.2 | |
Tax Proceeding |
Section 6.9(d) |
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Third Party Claim |
Section 10.2(a) | |
Total Incentive Cash Consideration |
Section 3.3(b) | |
Transfer Taxes |
Section 6.9(h) | |
Transferring Plans |
Section 6.9(h) | |
Transition Services Agreement |
Section 6.5(b) | |
VMDD |
Section 6.14(b) | |
VMI |
Section 6.14(a) | |
Working Capital Escrow Amount |
Section 3.1 | |
Working Capital Escrow Fund |
Section 3.4 |
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Section 1.3 Construction. Unless otherwise expressly provided herein, for purposes of this Agreement, the following rules of interpretation shall apply:
(a) when calculating the period of time before which, within which or following which any act is to be done or step taken, the date that is the reference date in beginning the calculation of such period shall be excluded (for example, if an action is to be taken within two (2) calendar days of a triggering event and such event occurs on a Tuesday, then the action must be taken by the end of the day on Thursday) and if the last day of such period is a non-Business Day, the period in question shall end on the next succeeding Business Day;
(b) any reference to gender shall include all genders, and words imparting the singular number only shall include the plural and vice versa;
(c) the provision of a Table of Contents, the division into Articles, Sections and other subdivisions and the insertion of headings are for convenience of reference only and shall not affect or be utilized in construing or interpreting this Agreement and all references in this Agreement to any Article, Section, Disclosure Schedule or Exhibit are to the corresponding Article, Section, Disclosure Schedule or Exhibit of or to this Agreement;
(d) unless otherwise specified, references to any Law or other statute, rule, regulation or form (including in the definition thereof) shall be deemed to include references to such Law or other statute, rule, regulation or form as amended, modified, supplemented, replaced or interpreted from time to time (and, in the case of any statute, include any rules and regulations promulgated under such statute), and all references to any Section of any statute, rule, regulation or form include any successor to such section;
(e) words such as herein, hereinafter, hereof, hereto and hereunder refer to this Agreement as a whole and not merely to any particular section or provision of this Agreement;
(f) the word including and any variation thereof means including without limitation and shall not be construed to limit any general statement that it follows to the specific or similar items or matters immediately following it;
(g) the word extent in the phrase to the extent shall mean the degree to which a subject or other thing extends, and such phrase shall not simply mean if;
(h) all references to currency, monetary values and dollars set forth herein shall, unless otherwise indicated, mean U.S. dollars and all payments hereunder shall be made in U.S. dollars;
(i) all references to any period of days are to the relevant number of calendar days unless otherwise specified;
(j) each Party has participated in the drafting of this Agreement, which each Party acknowledges is the result of negotiations among the Parties (as sophisticated Persons),
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and consequently, this Agreement shall be interpreted without reference to any Laws to the effect that any ambiguity in a document be construed against the drafter;
(k) all references to a document or item of information having been made available will be deemed to include (i) with respect to the Purchaser, the making available of such document or item of information to the Purchaser, the Purchasers counsel, the Purchasers financial advisor or any other Representative of the Purchaser or (ii) the posting of such document or item of information in an electronic data room accessible by the Purchaser or any of its Representatives at least two Business Days prior to the Closing Date; provided, that all references to a document or item of information having been made available via the data room will be deemed to include only the posting pursuant to clause (ii) above; and
(l) all accounting terms not specifically defined herein shall be construed in accordance with GAAP.
Section 1.4 Disclosure Schedule. The disclosures in the Disclosure Schedule shall be deemed to be responsive to and to qualify the representations and warranties of the Company contained in the corresponding sections in this Agreement and any other representations and warranties in this Agreement so long as the relationship between the disclosure and the other representations and warranties are reasonably apparent on the face of the disclosure. The inclusion of information in the Disclosure Schedule shall not be construed as or constitute an admission or agreement that a violation, right of termination, default, liability or other obligation of any kind exists with respect to any item, nor shall it be construed as or constitute an admission or agreement that such information is material to the Company. In addition, matters reflected in the Disclosure Schedule are not necessarily limited to matters required by this Agreement to be reflected in the Disclosure Schedule (including the listing of items on any Disclosure Schedule although such items may not necessarily be required to be included in such Disclosure Schedule because of the dollar thresholds set forth in this Agreement). Such additional matters are set forth for informational purposes only and do not necessarily include other matters of a similar nature. Neither the specifications of any dollar amount in any representation, warranty or covenant contained in this Agreement nor the inclusion of any specific item in the Disclosure Schedule is intended to imply that such amount, or higher or lower amounts, or the item so included or other items, are or are not material, and no Person shall use the fact of the setting forth of any such amount or the inclusion of any such item in any dispute or controversy between the Parties as to whether any obligation, item or matter not described herein or included in the Disclosure Schedule is or is not material for purposes of this Agreement. Further, neither the specification of any item or matter in any representation, warranty or covenant contained in this Agreement nor the inclusion of any specific item in the Disclosure Schedule is intended to imply that such item or matter, or other items or matters, are or are not in the Ordinary Course, and no Person shall use the fact of setting forth or the inclusion of any such items or matter in any dispute or controversy between the Parties as to whether any obligation, item or matter not described herein or included in the Disclosure Schedule is or is not in the Ordinary Course for purposes of this Agreement.
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ARTICLE II
MERGER
Section 2.1 Agreement to Merge. Subject to the terms and conditions of this Agreement, and in accordance with the DGCL, at the Effective Time, Merger Sub shall be merged with and into the Company. The Parties shall cause a certificate of merger (the Certificate of Merger) to be properly executed and filed on the Closing Date with the Secretary of State of the State of Delaware. The Effective Time shall be the time at which the Certificate of Merger is duly filed with the Secretary of State of the State of Delaware and has become effective in accordance with the DGCL or such later time as may be agreed by the Parties and specified in the Certificate of Merger.
Section 2.2 Effect of the Merger. At the Effective Time, the effect of the Merger shall be as provided in this Agreement and the applicable provisions of the DGCL. Subject to the foregoing, from and after the Effective Time, the Surviving Corporation shall possess and be vested with all rights, properties, privileges, immunities, powers and franchises and be subject to all the obligations, restrictions, disabilities, liabilities, debts and duties of the Company and Merger Sub. From and after the Effective Time, the separate corporate existence of Merger Sub shall cease and the Company shall continue as the surviving corporation in the Merger (the Company, as the surviving corporation in the Merger, sometimes being referred to herein as the Surviving Corporation). From and after the Effective Time and consistent with the transactions contemplated by this Agreement, the officers and directors of the Surviving Corporation are authorized to execute and deliver, in the name and on behalf of the Company or Merger Sub, all instruments and documents to take and do, in the name and on behalf of each of such corporations or otherwise, all such other actions as may be necessary or desirable to vest, perfect or confirm of record in, or otherwise in favor of, the Surviving Corporation any and all rights, title and interest in, to and under any and all of the rights, properties, privileges, immunities, powers and franchises of the Company or Merger Sub or otherwise to carry out the transactions contemplated by this Agreement.
Section 2.3 Certificate of Incorporation and Bylaws. At the Effective Time, the certificate of incorporation and bylaws of the Surviving Corporation shall be amended and restated in their entirety to read as set forth in Exhibit 2.3(i) and Exhibit 2.3(ii), respectively, and as so amended and restated, shall be the certificate of incorporation and bylaws of the Surviving Corporation, until the same shall thereafter be altered, amended or repealed in accordance with applicable Law.
Section 2.4 Directors and Officers.
(a) The Parties hereto shall take all requisite action so that the directors of Merger Sub serving in those positions immediately prior to the Effective Time shall become, as of the Effective Time, and shall remain the directors of the Surviving Corporation after the Merger, in each case until their respective successors are duly elected or appointed and qualified or until their earlier death, resignation or removal.
(b) The Parties hereto shall take all requisite action so that the officers of the Company serving in those positions immediately prior to the Effective Time shall become, as of
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the Effective Time, and shall remain the officers of the Surviving Corporation after the Merger, in each case until their respective successors are duly appointed and qualified or until their earlier death, resignation or removal.
Section 2.5 Effect on Stock and Options. As of the Effective Time, by virtue of the Merger (or, in the case of amounts payable to Option Holders pursuant to Section 2.5(a)(ix), by virtue of the Company Incentive Plan and action taken by the board of directors of the Company pursuant to Section 2.5(e)) and without any action, as applicable, on the part of any of the Purchaser, Merger Sub, the Company or any Stockholder:
(a) Subject to the other provisions of this Section 2.5:
(i) Each share of Series A-1 Preferred Stock (other than the Dissenting Shares and the Canceled Shares) issued and outstanding immediately prior to the Effective Time shall automatically be converted into the right to receive, upon the surrender of the certificate formerly representing such share of Series A-1 Preferred Stock, an amount equal to the Per Series A-1 Preferred Share Redemption Amount of such share, and each such share of Series A-1 Preferred Stock shall no longer be outstanding and shall be canceled and shall cease to exist, and each holder of such Certificate, which immediately prior to the Effective Time represents any such share of Series A-1 Preferred Stock, shall cease to have any rights with respect thereto, except the right to receive the Per Series A-1 Preferred Share Redemption Amount of such share upon surrender of such Certificate in accordance with Section 2.6, without interest;
(ii) Each share of Series A-2 Preferred Stock (other than the Dissenting Shares and the Canceled Shares) issued and outstanding immediately prior to the Effective Time shall automatically be converted into the right to receive, upon the surrender of the certificate formerly representing such share of Series A-2 Preferred Stock, an amount equal to the Per Series A-2 Preferred Share Redemption Amount of such share, and each such share of Series A-2 Preferred Stock shall no longer be outstanding and shall be canceled and shall cease to exist, and each holder of such Certificate, which immediately prior to the Effective Time represents any such share of Series A-2 Preferred Stock, shall cease to have any rights with respect thereto, except the right to receive the Per Series A-2 Preferred Share Redemption Amount of such share upon surrender of such Certificate in accordance with Section 2.6, without interest;
(iii) Each share of Series A-3 Preferred Stock (other than the Dissenting Shares and the Canceled Shares) issued and outstanding immediately prior to the Effective Time shall automatically be converted into the right to receive, upon the surrender of the certificate formerly representing such share of Series A-3 Preferred Stock, an amount equal to the Per Series A-3 Preferred Share Redemption Amount of such share, and each such share of Series A-3 Preferred Stock shall no longer be outstanding and shall be canceled and shall cease to exist, and each holder of such Certificate, which immediately prior to the Effective Time represents any such share of Series A-3 Preferred Stock, shall
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cease to have any rights with respect thereto, except the right to receive the Per Series A-3 Preferred Share Redemption Amount of such share upon surrender of such Certificate in accordance with Section 2.6, without interest;
(iv) Each share of Series A-4 Preferred Stock (other than the Dissenting Shares and the Canceled Shares) issued and outstanding immediately prior to the Effective Time shall automatically be converted into the right to receive, upon the surrender of the certificate formerly representing such share of Series A-4 Preferred Stock, an amount equal to the Per Series A-4 Preferred Share Redemption Amount of such share, and each such share of Series A-4 Preferred Stock shall no longer be outstanding and shall be canceled and shall cease to exist, and each holder of such Certificate, which immediately prior to the Effective Time represents any such share of Series A-4 Preferred Stock, shall cease to have any rights with respect thereto, except the right to receive the Per Series A-4 Preferred Share Redemption Amount of such share upon surrender of such Certificate in accordance with Section 2.6, without interest;
(v) Each share of Series A-5 Preferred Stock (other than the Dissenting Shares and the Canceled Shares) issued and outstanding immediately prior to the Effective Time shall automatically be converted into the right to receive, upon the surrender of the certificate formerly representing such share of Series A-5 Preferred Stock, an amount equal to the Per Series A-5 Preferred Share Redemption Amount of such share, and each such share of Series A-5 Preferred Stock shall no longer be outstanding and shall be canceled and shall cease to exist, and each holder of such Certificate, which immediately prior to the Effective Time represents any such share of Series A-5 Preferred Stock, shall cease to have any rights with respect thereto, except the right to receive the Per Series A-5 Preferred Share Redemption Amount of such share upon surrender of such Certificate in accordance with Section 2.6, without interest;
(vi) Each share of Series B-1 Preferred Stock (other than the Dissenting Shares and the Canceled Shares) issued and outstanding immediately prior to the Effective Time shall automatically be converted into the right to receive, upon the surrender of the certificate formerly representing such share of Series B-1 Preferred Stock, an amount equal to the Per Series B-1 Preferred Share Redemption Amount, and each such share of Series B-1 Preferred Stock shall no longer be outstanding and shall be canceled and shall cease to exist, and each holder of such Certificate, which immediately prior to the Effective Time represents any such share of Series B-1 Preferred Stock, shall cease to have any rights with respect thereto, except the right to receive the Per Series B-1 Preferred Share Redemption Amount upon surrender of such Certificate in accordance with Section 2.6, without interest;
(vii) Each share of Series C-1 Preferred Stock (other than the Dissenting Shares and the Canceled Shares) issued and outstanding immediately prior to the Effective Time shall automatically be converted into the right to receive, upon the surrender of the certificate formerly representing such share of Series C-1
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Preferred Stock, an amount equal to the Per Series C-1 Preferred Share Redemption Amount of such share, and each such share of Series C-1 Preferred Stock shall no longer be outstanding and shall be canceled and shall cease to exist, and each holder of such Certificate, which immediately prior to the Effective Time represents any such share of Series C-1 Preferred Stock, shall cease to have any rights with respect thereto, except the right to receive the Per Series C-1 Preferred Share Redemption Amount of such share upon surrender of such Certificate in accordance with Section 2.6, without interest;
(viii) Each share of Common Stock (other than the Dissenting Shares and the Canceled Shares) issued and outstanding immediately prior to the Effective Time shall automatically be converted into the right to receive, upon the surrender of the Certificate formerly representing such share of Common Stock, an amount equal to the Per Share Cash Consideration, and each such share of Common Stock shall no longer be outstanding and shall be canceled and shall cease to exist, and each holder of such Certificate, which immediately prior to the Effective Time represents any such share of Common Stock, shall cease to have any rights with respect thereto, except (A) the right to receive the Per Share Cash Consideration to be paid in consideration therefor upon surrender of such Certificate in accordance with Section 2.6, without interest and (B) the contingent right to receive that portion of such Holders Pro Rata Percentage attributable to such shares of Common Stock of the amount, if any, of (1) (x) the Working Capital Escrow Fund and (y) the Lithotech Escrow Fund released to the Holders in accordance with the terms of the Escrow Agreement, (2) the Stockholder Representative Reserve when released in accordance with Section 11.15(d) hereof, (3) refunds of Taxes for the Pre-Closing Period that are payable to the Holders pursuant to and in accordance with Section 6.9(e) and (4) without duplication of any amounts described in clause (3), Tax Benefits as a result of Transaction Tax Deductions that are payable to the Holders pursuant to and in accordance with Section 6.9(k);
(ix) Each In The Money Option issued and outstanding immediately prior to the Effective Time shall automatically be canceled and converted into (A) the right of the Option Holder of such In The Money Option to receive an amount equal to the applicable Per Option Cash Consideration, if any, allocable to such In The Money Option in accordance with this Agreement, the Company Incentive Plan and the Certificate of Incorporation and (B) the contingent right to receive that portion of such Holders Pro Rata Percentage attributable to the shares underlying such In The Money Options, if any, of (1) (x) the Working Capital Escrow Fund and (y) the Lithotech Escrow Fund released to the Holders in accordance with the terms of the Escrow Agreement, (2) the Stockholder Representative Reserve when released in accordance with Section 11.15(d) hereof, (3) refunds of Taxes for the Pre-Closing Period that are payable to the Holders pursuant to and in accordance with Section 6.9(e) and (4) without duplication of any amounts described in clause (3), Tax Benefits as a result of Transaction Tax Deductions that are payable to the Holders pursuant to and in accordance with Section 6.9(k) (any amounts which the Option Holders are
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entitled to receive in respect of items (1) through (4) of this paragraph, collectively, the Post-Closing Option Consideration); and
(x) Each Stock Unit issued and outstanding immediately prior to the Effective Time shall automatically be canceled and converted into the shares of Series B-1 Preferred Stock represented by such Stock Unit (such shares, the Converted Stock Unit B-1 Shares) and thereafter subject to Section 2.5(a)(vi) above in all respects.
(b) Each share of common stock of Merger Sub issued and outstanding immediately prior to the Effective Time shall, by virtue of the Merger, be converted into one fully paid and non-assessable share of common stock, par value $0.001 per share, of the Surviving Corporation, and such common stock of the Surviving Corporation issued upon such conversion shall constitute all of the issued and outstanding shares of capital stock of the Surviving Corporation immediately following the Effective Time and shall be held entirely by the Purchaser.
(c) Each share of Series A Preferred Stock, Series B-1 Preferred Stock, Series C-1 Preferred Stock and Common Stock of the Company that is owned by the Company or any Subsidiary of the Company (as treasury or otherwise), or by the Purchaser or any subsidiary of the Purchaser, including Merger Sub, immediately prior to the Effective Time (collectively, the Canceled Shares) shall be canceled and shall cease to exist and no payment shall be made in connection with the Merger with respect thereto.
(d) Notwithstanding any provision of this Agreement to the contrary, shares of Company Stock (the Dissenting Shares) that are issued and outstanding immediately prior to the Effective Time and that are held by a Common Stockholder that has not voted such shares in favor of the Merger (or executed a written consent approving the Merger) and who is entitled to demand, and has properly demanded, appraisal rights in the manner provided by Section 262 of the DGCL (a Dissenting Stockholder), shall not be converted into or be exchangeable for the right to receive any Merger Consideration, but instead such Dissenting Stockholder shall be entitled to payment of the fair value of such shares in accordance with the provisions of Section 262 of the DGCL (and at the Effective Time, such Dissenting Shares shall no longer be outstanding and shall automatically be canceled and shall cease to exist, and such holder shall cease to have any rights with respect thereto, except the right to receive the fair value of such Dissenting Shares in accordance with the provisions of Section 262 of the DGCL), unless and until such Dissenting Stockholder shall have failed to perfect or shall have effectively waived, withdrawn or lost its rights to appraisal under the DGCL (or a court of competent jurisdiction shall determine that such Stockholder is not entitled to the relief provided by Section 262 of the DGCL). If any Dissenting Stockholder shall have failed to perfect or shall have effectively waived, withdrawn or lost such right (or a court of competent jurisdiction shall determine that such holder is not entitled to the relief provided by Section 262 of the DGCL), such holders shares of Company Stock, as the case may be, shall thereupon be treated as if they had been converted into and become exchangeable for the right to receive, as of the Effective Time, the Merger Consideration for each such share, in accordance with Section 2.5(a), without any interest thereon. The Company
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shall give the Purchaser prompt notice of any demands received by the Company for appraisal of any shares of Company Stock, as the case may be. The Company shall not, except with the prior written consent of the Purchaser (not to be unreasonably conditioned, withheld or delayed), make any payment with respect to, or settle or offer to settle, any such demands with respect to any holder of Dissenting Shares before the Effective Time. Each Person holding of record or beneficially owning Dissenting Shares that becomes entitled under the DGCL to payment of the fair value of such Dissenting Shares shall receive payment therefor from the Surviving Corporation.
(e) Promptly after the execution of this Agreement and prior to the Effective Time, the Company and its board of directors shall take all necessary actions to provide that (i) all unvested In The Money Options will become fully vested and exercisable as of the Effective Time, (ii) all outstanding Options (whether vested or unvested) that have not been exercised as of immediately prior to the Effective Time shall cease to be exercisable, shall cease to exist and shall automatically be terminated and retired without any further action of the Company, the Purchaser, Merger Sub or Option Holder, and each Option Holder shall cease to have any rights with respect thereto, except as provided in Section 2.5(a)(ix) above and (iii) all Stock Units (whether vested or unvested) outstanding as of immediately prior to the Effective Time shall automatically be canceled and converted into shares of Series B-1 Preferred Stock pursuant to Section 2.5(a)(x) without any further action of the Company, the Purchaser, Merger Sub or the Stock Unit Holder, and each Stock Unit Holder shall cease to have any rights with respect thereto. For the avoidance of doubt, each holder of an Option that is not an In The Money Option shall not be entitled to receive any payment with respect to such Option and, immediately prior to the Effective Time, each such Option shall be canceled and the holder thereof shall cease to have rights with respect thereto.
Section 2.6 Exchange of Certificates.
(a) Prior to receiving any portion of the Merger Consideration, each holder of record of a certificate or certificates that immediately prior to the Effective Time represented issued and outstanding shares of Company Stock (the Certificates) shall have delivered to the Paying Agent (i) a properly completed and duly executed letter of transmittal in a form and substance reasonably satisfactory to the Purchaser and the Paying Agent (a Letter of Transmittal) and (ii) the Certificates held of record by such holder. Such Letter of Transmittal shall have been previously delivered by the Paying Agent to such holder along with instructions thereto and a notice to the effect that delivery of the Certificates shall be effected, and risk of loss and title to the Certificates shall pass only upon delivery of the Certificates to the Paying Agent. Upon surrender of a Certificate to the Paying Agent, together with such Letter of Transmittal, duly executed, the holder of such Certificate shall be entitled to receive in exchange therefor the consideration into which the shares represented by such Certificate shall have been converted pursuant to Section 2.5(a), and the Certificate so surrendered shall be canceled. If the portion of the Merger Consideration to be paid with respect to such shares is to be paid to a Person other than the Person in whose name the Certificate so surrendered is registered, it shall be a condition of exchange that such Certificate shall be properly endorsed or otherwise in proper form for transfer and that the Person requesting such
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exchange shall pay any transfer or other Taxes required by reason of the exchange to a Person other than the registered holder of such Certificate or establish to the reasonable satisfaction of the Company that such Tax has been paid or is not applicable. Until surrendered as contemplated by this Section 2.6, each Certificate shall be deemed as of the Effective Time of the Merger to represent only the right or the contingent right, as applicable, to receive, upon surrender of such Certificate in accordance with this Section 2.6(a), the portion of the Merger Consideration into which the shares of Company Stock shall have been converted pursuant to Section 2.5(a). If any Certificate shall have been lost, stolen or destroyed, the Paying Agent may, in its discretion and as a condition precedent to the issuance of any Merger Consideration in respect thereof pursuant to Section 2.5(a), require the owner of such lost, stolen or destroyed Certificate to provide an appropriate affidavit or indemnity agreement with respect to such Certificate.
(b) All Merger Consideration paid upon the surrender of Certificates in accordance with the terms of this ARTICLE II shall be deemed to have been exchanged and paid in full satisfaction of all rights pertaining to the shares represented by such Certificates and there shall be no further registration of transfers on the stock transfer books of the Surviving Corporation of the shares of the Company Stock that were issued and outstanding immediately prior to the Effective Time of the Merger. If, after the Effective Time, Certificates are presented to the Surviving Corporation for any reason, they shall be canceled and exchanged for the applicable portion of the Merger Consideration as provided in this ARTICLE II.
(c) Subject to applicable Laws, at any time following the six (6) month anniversary of the Closing Date, the Surviving Corporation shall be entitled to require the Paying Agent to deliver to it any funds (including any interest received with respect thereto) that had been made available to the Paying Agent and which have not been disbursed to the Stockholders, and thereafter, such Stockholders shall be entitled to look only to the Surviving Corporation (subject to abandoned property, escheat or other similar Laws) as general creditors thereof with respect to the payment of any Merger Consideration that would otherwise be payable upon surrender of any Certificates held by such Stockholders, as determined pursuant to this Agreement, without any interest thereon. Any amounts remaining unclaimed by such Stockholders at such time at which such amounts would otherwise escheat to or become property of any Governmental Entity shall become, to the extent permitted by applicable Laws, the property of the Purchaser, free and clear of all claims or interests of any Person previously entitled thereto. Notwithstanding the foregoing, none of the Purchaser, Merger Sub or the Surviving Corporation shall be liable to any former Stockholders for any portion of the Merger Consideration or interest thereon properly delivered to a public official pursuant to any applicable abandoned property, escheat or other similar Law.
(d) The Paying Agent, the Purchaser, Merger Sub, or the Surviving Corporation (as appropriate) shall be entitled to deduct and withhold from consideration otherwise payable pursuant to this Agreement to any Stockholders such amounts as are required to be deducted and withheld with respect to the making of such payment under the Code, or any provision of state, local or foreign Tax Law; provided, that the Paying Agent must be provided with prior written notice of any such required withholding at
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least five (5) days prior to the date of such payment. To the extent that amounts are so withheld, (i) such withheld amounts shall be treated for all purposes of this Agreement as having been paid to the Stockholders in respect of which such deduction and withholding was made and (ii) the Paying Agent, the Purchaser, the Company or the Surviving Corporation (as appropriate) shall provide such Stockholders written notice of the amounts so deducted or withheld.
(e) The applicable Stockholder Loan Amount will be deducted from the consideration paid pursuant to Section 2.5(a) to each Stockholder Loan Party, as applicable.
ARTICLE III
MERGER CONSIDERATION
Section 3.1 Merger Consideration. Notwithstanding anything to the contrary set forth herein, the aggregate Cash amount to be paid by the Purchaser to the Stockholders at the Closing (the Cash Consideration) shall be an amount equal to (a) the Enterprise Value, minus (b) the amount of the Closing Date Indebtedness determined in accordance with Section 3.2(a), plus (c) the amount of the Estimated Closing Cash determined in accordance with Section 3.2(a), plus (d) the amount of the Estimated Working Capital Surplus, if any, determined in accordance with Section 3.2(a), minus (e) the amount of the Estimated Working Capital Deficit, if any, determined in accordance with Section 3.2(a), minus (f) the amount of the Estimated Transaction Expenses, if any, determined in accordance with Section 3.2(a), minus (g) One Million Dollars ($1,000,000) (the Working Capital Escrow Amount), minus (h) Two Million Five Hundred Thousand Dollars ($2,500,000) (the Lithotech Earnout Escrow Amount) minus (i) Three Million Dollars ($3,000,000) (the Stockholder Representative Reserve) minus (i) the Severance Costs, minus (j) the Continuing Transition Employee Compensation; provided, however, there shall be no duplication in any of the foregoing reductions and there shall be no reduction as otherwise provided in this Section 3.1 to the extent such liability or obligation is reserved for in both the Estimated Closing Statement and the Final Closing Statement.
Section 3.2 Closing Date Statements. Not less than two (2) Business Days prior to the Closing Date, the Company shall deliver to the Purchaser:
(a) an estimated closing statement (the Estimated Closing Statement), signed by the Chief Financial Officer or the Chief Executive Officer of the Company (on behalf and in the name of the Company), which sets forth in reasonable detail (i) the aggregate amount of the Closing Date Indebtedness and (ii) the Companys reasonable good faith calculation of (A) the estimated Closing Date Net Working Capital (the Estimated Closing Date Net Working Capital), the Estimated Working Capital Surplus, if any, and the Estimated Working Capital Deficit, if any, resulting therefrom, (B) the estimated Closing Cash (the Estimated Closing Cash) and (C) the estimated Transaction Expenses (the Estimated Transaction Expenses). The Company shall provide the Purchaser and its Representatives with reasonable access to appropriate employees and advisors of the Company during normal business hours and access to such books and records as may be reasonably requested by them to review the information contained in the Estimated Closing Statement. The Company shall take into
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consideration any proposed revisions to the Estimated Closing Statement as are presented in good faith by the Purchaser. If the Company and the Purchaser are unable to resolve any dispute with respect to the Estimated Closing Statement, such dispute shall not under any circumstance delay the Closing, and the amounts set forth therein shall be calculated as set forth in the Estimated Closing Statement (as modified to reflect any revision mutually agreed upon by the Purchaser and the Company), for the purposes of the Closing; and
(b) a statement (the Closing Date Holder Payment Statement), signed by the Chief Financial Officer or the Chief Executive Officer of the Company (on behalf and in the name of the Company), which sets forth in reasonable detail, in each case as of immediately prior to the Effective Time (i) the number of Fully Diluted Shares, the total number of shares of Common Stock outstanding immediately prior to the Effective Time (excluding any shares held as treasury stock), the total number of In The Money Options, the Per Series A-1 Preferred Share Redemption Amount, the Per Series A-2 Preferred Share Redemption Amount, the Per Series A-3 Preferred Share Redemption Amount, the Per Series A-4 Preferred Share Redemption Amount, the Per Series A-5 Preferred Share Redemption Amount, the Per Series B-1 Preferred Share Redemption Amount, the Per Series C-1 Preferred Share Redemption Amount, the Per Share Cash Consideration, the Per Option Cash Consideration and the aggregate amounts payable by the Purchaser to the Paying Agent and the Company pursuant to Section 3.3(a) and Section 3.3(b) of this Agreement (i.e., the Stockholder Cash Consideration and the Total Incentive Cash Consideration, respectively) and (ii) the name of each Stockholder, the number of Fully Diluted Shares held by each Stockholder, each Stockholders Pro Rata Percentage, the number and class of shares of Company Stock held by each Stockholder, the aggregate amount of the Stockholder Cash Consideration to be paid to each Stockholder at the Closing pursuant to Section 3.3(a) of this Agreement and the aggregate amount of the Total Incentive Cash Consideration to be paid to each Stockholder at the Closing pursuant to Section 3.3(b) of this Agreement.
Section 3.3 Payment of Cash Consideration. On the Closing Date, the Purchaser shall pay the Cash Consideration in accordance with the following, which amounts shall then be distributed by the recipient of such amounts as set forth herein:
(a) to the Paying Agent, by wire transfer of immediately available funds to an account designated by the Paying Agent two (2) Business Days prior to the Closing, an amount equal to (i) the Aggregate Preferred Redemption Amount (other than any amount payable with respect to any Converted Stock Unit B-1 Shares) plus (ii) the Aggregate Common Proceeds (collectively, the Stockholder Cash Consideration), which amount shall be paid promptly by the Paying Agent to the Stockholders in accordance with Section 2.6 and the Closing Date Holder Payment Statement; and
(b) to the Company, by wire transfer of immediately available funds to an account designated by the Company two (2) Business Days prior to the Closing, an amount equal to (i) the Option Holder Cash Consideration plus (ii) the Per Series B-1 Preferred Share Redemption Amount payable only with respect to all Converted Stock Unit B-1 Shares (the Converted Stock Unit B-1 Share Cash Consideration and, together
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with the Option Holder Cash Consideration, the Total Incentive Cash Consideration), which amount shall be paid promptly by the Company (through its payroll process or otherwise) to the Option Holders or the holders of the Converted Stock Unit B-1 Shares, as applicable, in accordance with the Closing Date Holder Payment Statement.
Section 3.4 Payment of Escrow Amounts. On the Closing Date, the Purchaser shall deposit with the Escrow Agent, by wire transfer of immediately available funds to an account designated by the Escrow Agent at least two (2) Business Days prior to the Closing Date, the Working Capital Escrow Amount and the Lithotech Escrow Amount, each of which shall be distributed in accordance with the terms of this Agreement and the Escrow Agreement.
(a) The Working Capital Escrow Amount, as adjusted from time to time, together with any interest earned thereon, shall be referred to as the Working Capital Escrow Fund. The Escrow Agreement shall provide that on the date upon which a payment of the Final Surplus or Final Shortfall, as the case may be, is to be made pursuant to Section 3.6, the Escrow Agent shall, upon receipt of joint written instructions of the Purchaser and the Stockholder Representative, make the following payments:
(i) if there is a Final Surplus (or not a Final Shortfall), the Escrow Agent shall pay to the Paying Agent, for the benefit of the Holders in accordance with their Pro Rata Percentages (or, in the case of the Option Holders, the Escrow Agent shall pay to the Company, for the benefit of the Option Holders in accordance with their Pro Rata Percentages), the entire Working Capital Escrow Fund; or
(ii) if there is a Final Shortfall, the Escrow Agent shall pay (i) to the Purchaser, the lesser of the amount of such Final Shortfall or the amount of the Working Capital Escrow Fund and (ii) to the Paying Agent, for the benefit of the Holders in accordance with their Pro Rata Percentages (or, in the case of the Option Holders, the Escrow Agent shall pay to the Company, for the benefit of the Option Holders in accordance with their Pro Rata Percentages), the amount, if any, by which the Working Capital Escrow Fund exceeds the Final Shortfall.
(b) The Lithotech Earnout Escrow Amount, as adjusted from time to time, together with any interest earned thereon, shall be referred to as the Lithotech Earnout Escrow Fund. On the Lithotech Earnout Date(s), upon receipt of joint written instructions of the Purchaser and the Stockholder Representative, the Escrow Agent shall make the following payments:
(i) to the paying agent under the Lithotech Agreement, the amount of the Lithotech Earnout Payment(s), if any; and
(ii) to the Paying Agent, for the benefit of the Holders in accordance with their Pro Rata Percentages (or, in the case of the Option Holders, the Escrow Agent shall pay to the Company, for the benefit of the Option Holders in accordance with their Pro Rata Percentages), the amount, if any, that remains in the Lithotech Earnout Escrow Fund after
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the final determination of the Lithotech Earnout Payment(s) and after all payments have been made pursuant to Section 3.4(b)(i).
Section 3.5 Payment of Other Amounts Payable at Closing. On the Closing Date, the Purchaser shall:
(a) pay to the Stockholder Representative, by wire transfer of immediately available funds to an account designated in writing by the Stockholder Representative at least two (2) Business Days prior to the Closing Date, the Stockholder Representative Reserve;
(b) on behalf of the Company and its Subsidiaries, pay to such account or accounts as the Company specifies to the Purchaser in writing at least two (2) Business Days prior to the Closing Date, the aggregate amount of the Closing Date Indebtedness to the holders thereof in accordance with the Payoff Letters;
(c) on behalf of the Company and its Subsidiaries, pay to such account or accounts as the Company specifies to the Purchaser in writing at least two (2) Business Days prior to the Closing Date, the aggregate amount of the Estimated Transaction Expenses; and
(d) on behalf of the Company, pay to such account or accounts as the Company specifies to the Purchaser in writing at least two (2) Business Days prior to the Closing Date, to the extent not paid prior to the Closing Date, the aggregate amount of the D&O Tail Premium.
Section 3.6 Post-Closing Adjustment.
(a) No later than forty-five (45) days following the Closing Date, the Purchaser shall prepare and deliver to the Stockholder Representative the draft closing statement of the Company as of the Closing Date (the Proposed Closing Statement), which shall include a calculation of each of the Closing Date Net Working Capital, the Working Capital Surplus, if any, the Working Capital Deficit, if any, the Closing Cash, the Cash Deficit, if any, the Cash Surplus, if any, the Transaction Expenses, the Expense Overpayment, if any, the Expense Underpayment, if any, the Final Shortfall, if any, and the Final Surplus, if any. The calculation of the foregoing will be prepared in accordance with the accounting methods, policies, principles, practices, procedures, classifications and estimation methodologies (whether with regard to reserves or otherwise) that were used in the preparation of Exhibit 1.1(a) and shall not include any changes in assets or liabilities as a result of purchase accounting adjustments or other changes arising from or resulting as a consequence of the transactions contemplated by this Agreement. The Parties agree that the purpose of preparing the Proposed Closing Statement and determining Closing Date Net Working Capital, Closing Cash and Transaction Expenses pursuant to this Section 3.6 is to measure changes in Closing Date Net Working Capital, Closing Cash and Transaction Expenses against the Estimated Closing Date Net Working Capital, Estimated Closing Cash and Estimated Transaction Expenses amounts, and such process is not intended to permit the introduction of different judgments, accounting methods, policies, principles, practices, procedures, classifications or estimation methodologies (whether with regard to reserves or otherwise) for the purpose of
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preparing the Proposed Closing Statement or determining Closing Date Net Working Capital, Closing Cash and Transaction Expenses from those utilized by the Company in the preparation of the Estimated Closing Statement.
(b) The Stockholder Representative shall have thirty (30) days following receipt of the Proposed Closing Statement (the Evaluation Period) during which to notify the Purchaser in writing of any dispute of any item contained in the Proposed Closing Statement, which written notice (the Notice of Disagreement) shall set forth in reasonable detail the basis for such dispute. At any time within the Evaluation Period, the Stockholder Representative shall be entitled to agree with any or all of the items set forth in the Proposed Closing Statement. For purposes of the Stockholder Representatives evaluation of the Proposed Closing Statement, the Purchaser and the Surviving Corporation shall make available or provide reasonable access to the Stockholder Representative and its Representatives, upon advance notice and during normal business hours, all information, records, data and working papers created or used in connection with the preparation of the Proposed Closing Statement; and shall permit reasonable access, upon advance notice and during normal business hours, to the Surviving Corporations and its Subsidiaries facilities and personnel, as may be reasonably requested by the Stockholder Representative and its Representatives to analyze the Proposed Closing Statement. The Evaluation Period shall be tolled and thereby extended in respect of any delay of the Stockholder Representatives evaluation by more than five (5) days arising out of any failure of Purchaser or the Surviving Corporation to (x) timely and substantively respond to any reasonable request or (y) act in good faith in respect of the covenants contained in the foregoing sentence.
(c) If the Stockholder Representative does not deliver a Notice of Disagreement to the Purchaser within the Evaluation Period, or notifies the Purchaser of its agreement with the adjustments in the Proposed Closing Statement prior to the expiration of the Evaluation Period, the Proposed Closing Statement prepared by the Purchaser shall be deemed to be the Final Closing Statement, and shall be final, conclusive and binding on all Parties.
(d) If the Stockholder Representative delivers a Notice of Disagreement to the Purchaser within the Evaluation Period, the Final Closing Statement shall be resolved as follows:
(i) The Purchaser and the Stockholder Representative shall cooperate in good faith to resolve any such dispute as promptly as possible.
(ii) In the event the Purchaser and the Stockholder Representative are unable to resolve any such dispute within fifteen (15) days (or such longer period as the Purchaser and the Stockholder Representative shall mutually agree in writing) after delivery to the Purchaser of the Notice of Disagreement, such dispute and each Partys work papers related thereto shall be submitted to Deloitte (the Arbitrator) for resolution in accordance with this Section 3.6(d)(ii). The Stockholder Representative and the Purchaser shall use reasonable best efforts to cause the Arbitrator to render a written decision resolving the matters submitted to
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the Arbitrator within thirty (30) days of the making of such submission. The scope of the disputes to be resolved by the Arbitrator shall be limited to whether the items in dispute that were included in the Notice of Disagreement were prepared in accordance with this Agreement and the Arbitrator shall determine, on such basis, whether and to what extent, the Proposed Closing Statement requires adjustment. The Arbitrator is not to make any other determinations. The Arbitrators decision shall be based solely on written submissions and presentations by the Stockholder Representative and the Purchaser and their respective Representatives and not by independent review, and shall be made in accordance with the accounting methods, policies, principles, practices, procedures, classifications and estimation methodologies (whether with regard to reserves or otherwise) that were used in the preparation of Exhibit 1.1(a), to the extent applicable. The Arbitrator shall address only those items in dispute and may not assign a value greater than the greatest value for such item claimed by either Party or smaller than the smallest value for such item claimed by either Party. Judgment may be entered upon the determination of the Arbitrator in any court having jurisdiction over the Party against which such determination is to be enforced. The fees, costs and expenses of the Arbitrator shall be allocated between the Stockholder Representative (on behalf of the Holders), on the one hand, and the Purchaser (or, at its election, the Surviving Corporation), on the other hand, in the same proportion that the aggregate amount of the disputed items submitted to the Arbitrator that is unsuccessfully disputed by each such Party (as finally determined by the Arbitrator) bears to the total amount of such disputed items so submitted. For example, if the Stockholder Representative challenges the calculation of the Proposed Closing Statement by an amount of One Hundred Thousand Dollars ($100,000), but the Arbitrator determines that the Stockholder Representative has a valid claim for only Forty Thousand Dollars ($40,000), the Purchaser (or, at its election, the Surviving Corporation) shall bear forty percent (40%) of the fees and expenses of the Arbitrator and the Holders shall bear the other sixty percent (60%) of such fees and expenses, with the Holders portion of such fees and expenses paid solely out of the Stockholder Representative Reserve.
(e) The Purchaser and the Stockholder Representative jointly shall revise the Proposed Closing Statement and the calculation of Closing Date Net Working Capital, the Working Capital Surplus, if any, the Working Capital Deficit, if any, the Closing Cash, the Cash Deficit, if any, the Cash Surplus, if any, the Transaction Expenses, the Expense Overpayment, if any, the Expense Underpayment, if any, the Final Shortfall, if any, and the Final Surplus, if any, as appropriate to reflect the resolution of the Stockholder Representatives objections (as agreed upon by the Purchaser and the Stockholder Representative or as determined by the Arbitrator) and deliver it to the Stockholder Representative within ten (10) days after the resolution of such objections. Such revised Proposed Closing Statement shall be the Final Closing Statement, and shall be final, conclusive and binding on all Parties.
(f) To the extent there is a Final Shortfall on the Final Closing Statement, the Purchaser shall be entitled to recover the amount of the Final Shortfall solely from the Working Capital Escrow Fund in accordance with the Escrow Agreement.
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(g) To the extent there is a Final Surplus on the Final Closing Statement, the Purchaser shall pay the Paying Agent, on behalf of the Holders or, in the case of the Option Holders, the Purchaser shall pay to the Company for the benefit of the Option Holders (in accordance with their Pro Rata Percentages), the amount of the Final Surplus by wire transfer of immediately available funds within five (5) Business Days after the Purchasers delivery of the Final Closing Statement to the Stockholder Representative to an account or accounts designated by the Paying Agent. Upon such payment, Paying Agent shall disburse promptly such amount to the Holders in accordance with their Pro Rata Percentages.
(h) If there is no Final Shortfall and no Final Surplus, then no further adjustments or payments shall be made.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF THE COMPANY
The Company represents and warrants to the Purchaser and Merger Sub that, except as set forth in the Disclosure Schedule, as of the date hereof and as of the Closing Date:
Section 4.1 Organization. The Company is a corporation duly organized, validly existing and in good standing under the laws of the State of Delaware. Each of the Companys Subsidiaries is a corporation duly organized, validly existing and in good standing under the laws of the jurisdiction of its incorporation. The Company and each of its Subsidiaries have all requisite corporate power and authority to own, lease and operate its properties and to carry on its business as now being conducted. The Company and each of its Subsidiaries is duly qualified to transact business as a foreign corporation, and is in good standing in each other jurisdiction in which the ownership or leasing of its properties or assets or the conduct of its business requires such qualification, except where the failure to so qualify or to be in good standing has not had and would not reasonably be expected to result in, individually or in the aggregate, a Material Adverse Effect. The Company has previously made available via the data room to the Purchaser true and complete copies of the certificate of incorporation and bylaws or comparable organizational documents of the Company and each of its Subsidiaries as currently in effect.
Section 4.2 Authorization.
(a) The Company or its applicable Subsidiary has all necessary corporate power and authority to execute and deliver this Agreement, each Company Ancillary Document and the DMS Purchase Agreement, and to perform its obligations hereunder and thereunder and, subject to receiving the Company Stockholder Approval, if applicable, to consummate the transactions contemplated hereby and thereby. The execution, delivery and performance by the
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Company of this Agreement, the Company Ancillary Documents and the consummation by it of the Merger, and the execution, delivery and performance by the applicable Subsidiary of the Company of the DMS Purchase Agreement, have been duly authorized and approved by the Companys or its applicable Subsidiarys board of directors, as the case may be, and except for obtaining the Company Stockholder Approval, if applicable, no other corporate action on the part of the Company is necessary to authorize the execution, delivery and performance by the Company of this Agreement, the Company Ancillary Documents, the DMS Purchase Agreement and the consummation by the Company of the Merger. This Agreement has been, the DMS Purchase Agreement shall be, and, as of the Closing Date, the Company Ancillary Documents shall be, duly executed and delivered by the Company (or one of its Subsidiaries, as applicable) and, assuming due authorization, execution and delivery hereof and thereof by the other Parties hereto and thereto, do or will, as the case may be, constitute the valid and binding agreement of the Company or its applicable Subsidiary, enforceable against the Company or its applicable Subsidiary in accordance with their terms, except as such enforceability (i) may be limited by bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium or other similar Laws affecting or relating to enforcement of creditors rights generally and (ii) is subject to general principles of equity (regardless of whether enforceability is considered in a proceeding at law or in equity).
(b) Pursuant to resolutions effectuated by unanimous written consent in accordance with the applicable provisions of the DGCL, the Certificate of Incorporation, the Bylaws, the Stockholders Agreement and other governing documents of the Company, the board of directors of the Company (i) determined that it is in the best interest of its Stockholders for the Merger Sub to acquire the Company on the terms and subject to the conditions set forth herein, (ii) adopted a resolution approving, authorizing, adopting and declaring advisable the Merger, the DMS Transaction, this Agreement, and the transactions contemplated hereby and thereby, and (iii) resolved to recommend that the Stockholders adopt this Agreement and directed that the adoption of this Agreement be submitted to the Stockholders entitled to vote thereon for consideration (collectively, the Company Board Recommendation), which Company Board Recommendation has not been withdrawn or modified. The affirmative vote of the holders of at least a majority of (A) the issued and outstanding Series A-1 Preferred Stock, Series A-2 Preferred Stock, Series A-3 Preferred Stock, Series A-4 Preferred Stock and Series A-5 Preferred Stock present in person or represented by proxy, voting together as a single class at a meeting at which at least a majority of such classes of shares are present in person or represented by proxy (or, if action is to be taken by written consent, the affirmative consent of the holders of at least a majority of the issued and outstanding Series A-1 Preferred Stock, Series A-2 Preferred Stock, Series A-3 Preferred Stock, Series A-4 Preferred Stock and Series A-5 Preferred Stock voting together as a single class) and (B) the issued and outstanding Voting Common Stock present in person or represented by proxy, at a meeting at which at least a majority of such class of shares are present in person or represented by proxy (or, if action is to be taken by written consent, the affirmative consent of the holders of at least a majority of the issued and outstanding Voting Common Stock) ((A) and (B) collectively, the Company Stockholder Approval) are the only votes or approvals of the holders of any class or series of capital stock of the Company which is necessary to adopt this Agreement. No vote of any holders of any class or series of capital stock of the Company is necessary to consummate the DMS Transaction. The action by the Companys board of directors and the Company Stockholder Approval contemplated by this Section 4.2(b) constitute the only corporate or stockholder action, if applicable, on the part of the Company required to approve, authorize and adopt the Merger, the DMS Transaction, this Agreement and the transactions contemplated hereby and thereby under the DGCL, the Certificate of
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Incorporation, the Bylaws, the Stockholders Agreement and other governing documents of the Company.
Section 4.3 Capital Stock; Indebtedness.
(a) Section 4.3(a) of the Disclosure Schedule accurately and completely sets forth for the Company and each of its Subsidiaries, as of the date hereof, the number of shares of capital stock or other equity interests, including Stock Units and Options, of the Company and each of its Subsidiaries which are authorized and which are issued and outstanding. All of such issued and outstanding shares of capital stock or other equity or equity-based interests of the Company and each of its Subsidiaries are duly authorized, validly issued, fully paid and nonassessable, and are held of record by the Persons and in the amounts set forth in Section 4.3(a) of the Disclosure Schedule. Except as disclosed in Section 4.3(a) of the Disclosure Schedule or as set forth in the Certificate of Incorporation: (i) no shares of capital stock or other equity or equity-based interests of the Company or any of its Subsidiaries are reserved for issuance or are held as treasury shares; (ii) there are no outstanding options, warrants, rights, calls, conversion rights, rights of exchange, convertible or exchangeable securities or other plans or commitments, contingent or otherwise, relating to the capital stock or other equity or equity-based interests of the Company or any of its Subsidiaries other than as contemplated by this Agreement; (iii) there are no outstanding Contracts or other agreements of the Company or any of its Subsidiaries, or, to the Companys Knowledge, of any of the Stockholders or any other Person, to purchase, redeem or otherwise acquire any outstanding shares of capital stock or other equity or equity-based interests of the Company or any of its Subsidiaries, or securities or obligations of any kind convertible into any shares of the capital stock or other equity or equity-based interests of the Company or any of its Subsidiaries; and (iv) there are no outstanding or authorized stock appreciation, phantom stock, stock plans or similar rights with respect to the Company or any of its Subsidiaries.
(b) Section 4.3(b) of the Disclosure Schedule sets forth a list of all Indebtedness of the Company and its Subsidiaries as of the date of this Agreement.
Section 4.4 Subsidiaries. Section 4.4 of the Disclosure Schedule lists each Subsidiary of the Company. Except as set forth on Section 4.4 of the Disclosure Schedule, the Company owns, directly or indirectly, all of the issued and outstanding capital stock or other equity interests of each of its Subsidiaries, free and clear of all Liens. Except as set forth in Section 4.4 of the Disclosure Schedule, neither the Company nor any of the Companys Subsidiaries owns, directly or indirectly, any capital stock or other equities, securities or interests in any corporation, limited liability company, partnership, joint venture or other entity other than, prior to the closing of the DMS Transaction, the DMS Entities.
Section 4.5 Absence of Restrictions and Conflicts.
(a) Except as set forth in Section 4.5(a) of the Disclosure Schedule, subject to the receipt of the Company Stockholder Approval, the execution and delivery by the Company of this Agreement and the Company Ancillary Documents does not, and the performance of its obligations hereunder and thereunder will not, (i) conflict with or
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violate the Certificate of Incorporation, the Bylaws, the Stockholders Agreement or the certificate or articles of incorporation or bylaws of any Subsidiary, as amended or supplemented, (ii) assuming that all consents, approvals, authorizations, waiting period terminations or expirations, and other actions described in Section 4.5(b) have been obtained and all filings and obligations described in Section 4.5(b) have been made, conflict with or violate any Law applicable to the Company or any Subsidiary, or by which any material property or asset of the Company or any Subsidiary, is bound in any material respect or (iii) except as set forth in Section 4.5(a) of the Disclosure Schedule, require any consent or result in any violation or breach of or constitute (with or without notice or lapse of time or both) a default (or give to others any right of termination, amendment, acceleration or cancellation) under, or result in the triggering of any payments or result in the creation of a Lien on any property or asset of the Company or any Subsidiary, in all cases, pursuant to, any of the terms, conditions or provisions of any (A) Company Contract or (B) judgment, decree or order of any Governmental Entity, to which the Company or any of its Subsidiaries is a party or by which the Company, any of its Subsidiaries or any of their respective properties or assets are bound, except, with respect to clause (iii), such triggering of payments or creation of Liens which have not had and would not reasonably be expected to result in, individually or in the aggregate, a Material Adverse Effect.
(b) The execution and delivery by the Company of this Agreement does not, and the performance of its obligations hereunder and thereunder will not, require any consent, approval, authorization or permit of, or filing with or notification to, any Governmental Entity, except (i) for the pre-merger notification requirements of the HSR Act, (ii) the Company Stockholder Approval, (iii) the filing of a Certificate of Merger with, and the acceptance for record thereof by, the Secretary of State of the State of Delaware and (iv) as otherwise set forth in Section 4.5(b) of the Disclosure Schedule.
Section 4.6 Real Property. Section 4.6(a) of the Disclosure Schedule sets forth a correct and complete list of the Leased Real Property used in the conduct of the AT Business as of the date hereof. Section 4.6(b) of the Disclosure Schedule sets forth the street address of all real property used in the conduct of the AT Business in which the Company or any of its Subsidiaries has a fee ownership interest as of the date hereof (the Owned Real Property). The Real Property constitutes all of the real property currently utilized by the Company and its Subsidiaries in the conduct of the AT Business. To the extent owned by the Company or its Subsidiaries and in the possession, custody and control of the Company or its Subsidiaries, the Company has delivered to the Purchaser copies of (i) all deeds and other instruments (as recorded) by which the Company and its Subsidiaries acquired its interest in the Owned Real Property, and (ii) all title reports, surveys and title policies with respect to the Owned Real Property. The Company or one of its Subsidiaries has fee simple title to the Owned Real Property, and has not leased, subleased or licensed the Owned Real Property to any third party. The Company or one of its Subsidiaries has a valid leasehold interest in the Leased Real Property, and, to the Knowledge of the Company, no other party thereto is in default thereunder. The Company has not subleased or licensed the Leased Real Property used in the conduct of the AT Business to any third party. Except as set forth on Section 4.6(c) of the Disclosure Schedule, all real property used in the conduct of the business conducted by the DMS Entities is either owned by a DMS Entity or leased by a DMS Entity from an unaffiliated third party.
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Section 4.7 Title to Assets; Related Matters.
(a) The Company and its Subsidiaries have good and marketable title to, or a valid leasehold interest in, all of their respective personal and real property and assets, free and clear of all Liens other than Permitted Liens, and all equipment and other items of tangible personal property and assets of the Company and its Subsidiaries are in operating condition and capable of being used for their intended purposes (ordinary wear and tear excepted) and are usable in the Ordinary Course, except with respect to any of the foregoing as has not had and would not reasonably be expected to result in, individually or in the aggregate, a Material Adverse Effect.
(b) From and after the Closing, (i) except as set forth on Section 4.7(b)(i) of the Disclosure Schedule, the Company and its Subsidiaries (other than the DMS Entities) will own all assets sufficient to conduct the AT Business in substantially the same manner as the AT Business is being conducted by the Company and its Subsidiaries on the date hereof, and (ii) all debts, liabilities, obligations, guarantees, assurances and commitments, whether fixed, contingent or absolute, asserted or unasserted, matured or unmatured, liquidated or unliquidated, accrued or not accrued, known or unknown, due or to become due, whenever or however arising, of or related to the business conducted by the DMS Entities will be solely held by, performed by and fulfilled when due by the DMS Entities in accordance with their respective terms.
Section 4.8 Inventory. Except as set forth in Section 4.8 of the Disclosure Schedule, the inventory of the Company and its Subsidiaries consists, in all material respects, of a quality and quantity usable and saleable in the Ordinary Course, except for obsolete items and items of below-standard quality, all of which have been written off or written down to the lower of cost or net realizable value in accordance with GAAP in the Financial Statements. The inventories of the Company and its Subsidiaries constitute sufficient quantities for the normal operation of business in accordance with past practice, and are reasonable with respect to the present condition and circumstances of the Company and its Subsidiaries.
Section 4.9 Financial Statements. True and complete copies of the Financial Statements are attached as Section 4.9(a) of the Disclosure Schedule. Except as set forth in Section 4.9(b) of the Disclosure Schedule, the Financial Statements (including the related notes and schedules) have been prepared in accordance with GAAP (except as specifically indicated in the related notes and schedules) and each of the balance sheets included in the Financial Statements fairly presents in all material respects the consolidated financial position of the Company and its Subsidiaries (or, if applicable, of the DMS Entities) as of the date of such balance sheets, and each statement of comprehensive income, stockholders equity and cash flows included in the Financial Statements fairly presents in all material respects the consolidated results of operations and changes in stockholders equity or cash flows, as the case may be, of the Company and its Subsidiaries (or, if applicable, of the DMS Entities) for the periods set forth therein (except as specifically indicated in the related notes and schedules and subject, in the case of unaudited financial statements, to normal year end adjustments and the absence of notes to such statements, which adjustments if made, or which notes if included, would not be material individually or in the aggregate). True and complete copies of the AT Financial Information is attached as Section 4.9(c) of the Disclosure Schedule. The AT
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Financial Information (i) was derived from the books and records of the Company and its Subsidiaries and was prepared on a basis consistent with the Financial Statements, (ii) presents fairly in all material respects the financial position and financial performance of the AT Business for the periods set forth therein, and (iii) completely and accurately presents the corporate allocations required to operate the AT Business on a stand-alone basis. Neither the Company nor any of its Subsidiaries has any direct or indirect liability or obligation of any kind that would be required to be included on a balance sheet (including the notes thereto) prepared in accordance with GAAP, other than liabilities or obligations (i) specifically reflected and adequately reserved against in the Financial Statements (including all notes thereto) and (ii) incurred in the Ordinary Course since the date of the Balance Sheet.
Section 4.10 Absence of Certain Changes. Since the date of the Balance Sheet, except as disclosed in this Agreement (or its exhibits or the Disclosure Schedules), the Company and its Subsidiaries have conducted their respective businesses in the Ordinary Course and there has not been any event or occurrence of any condition, that, individually or in the aggregate, has had or would reasonably be expected to result in a Material Adverse Effect. Except as disclosed in the Disclosure Schedules, as of the date of this Agreement, the Company and each of its Subsidiaries (other than the DMS Entities) have complied in all material respects with the covenants and restrictions set forth in Section 6.1 to the same extent as if this Agreement had been executed on, and had been in effect since June 30, 2016.
Section 4.11 Legal Proceedings. Except as set forth in Section 4.11 of the Disclosure Schedule, there is no, and for the past three (3) years there has not been any, suit, action, claim, arbitration or proceeding (or, to the Knowledge of the Company, investigation) pending, or, to the Knowledge of the Company, threatened against the Company or any of its Subsidiaries or any property of any of them that has resulted in or would reasonably be expected to result in damage or liability to the Company and its Subsidiaries, taken as a whole, in excess of $250,000. Neither the Company nor any of its Subsidiaries is subject to any judgment, decree, injunction, rule or order of any court or arbitration panel that has been or would reasonably be expected be materially adverse to the Company and its Subsidiaries, taken as a whole. There is no suit, action, claim, arbitration or proceeding by or before any Governmental Entity pending or, to the Knowledge of the Company, threatened against the Company, any of its Subsidiaries or any property of the Company or any of its Subsidiaries which would reasonably be expected to prevent or materially delay consummation of the Merger and the other transactions contemplated by this Agreement or the DMS Purchase Agreement.
Section 4.12 Compliance with Laws; Licenses.
(a) Except as set forth in Section 4.12 of the Disclosure Schedule, the Company and its Subsidiaries are, and have been, in compliance with all Laws applicable to the Company and its Subsidiaries as they relate to the ownership or operation of their respective businesses, except where the failure to be in compliance would not reasonably be expected to result in a Material Adverse Effect. The Company and its Subsidiaries own or possess all Licenses that are necessary to enable them to carry on their operations as presently conducted. The execution and delivery of this Agreement and the consummation of the transactions contemplated hereby shall not adversely affect any such License, or require consent from, or notice to, any Governmental Entity with respect
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to such License, except as would not be materially adverse to the Company and its Subsidiaries, taken as a whole.
(b) Neither the Company nor any of its Subsidiaries is in violation of any applicable Law (including the U.S. Office of Foreign Asset Control list, Executive Order No. 13224) that prohibits or limits the conduct of business with or the receiving of funds, goods or services to or for the benefit of certain Persons specified therein or that prohibits or limits conducting business with the Company or its Subsidiaries, including any applicable Anti-Corruption Law. The Company and its Subsidiaries and, to the Knowledge of the Company, its and its Subsidiaries respective directors, officers, employees, agents, affiliates and representatives, are in compliance with applicable Anti-Corruption Laws and applicable Sanctions in all material respects and are not knowingly engaged in any activity that would reasonably be expected to result in the Company or its Subsidiaries being designated as a Sanctioned Person. Neither the Company, its Subsidiaries, nor, to the Knowledge of the Company, any of its or its Subsidiaries respective directors, officers, employees or agents that will act in any capacity in connection with or benefit from the transactions contemplated hereby, is a Sanctioned Person. None of the Company nor any of its Subsidiaries is located, organized or resident in any Sanctioned Country. No transaction contemplated by this Agreement or the DMS Purchase Agreement will violate any applicable Anti-Corruption Law or applicable Sanctions.
Section 4.13 Company Contracts.
(a) Section 4.13(a) of the Disclosure Schedule sets forth, by reference to the applicable subsection of this Section 4.13, a correct and complete list of the following Contracts to which the Company or any of its Subsidiaries is a party as of the date hereof (the Company Contracts) (other than the Employment Agreements set forth on Section 4.23 of the Disclosure Schedule, the Employee Benefit Plans set forth on Section 4.15 of the Disclosure Schedule, the insurance policies set forth on Section 4.17 of the Disclosure Schedule and any Contracts that are exclusively related to business conducted by the DMS Entities):
(i) all bonds, debentures, notes, loans, credit or loan agreements or loan commitments, mortgages, indentures, guarantees or other Contracts evidencing or governing any indebtedness for money borrowed by the Company or any of its Subsidiaries or any such Contract under which the Company or any of its Subsidiaries guaranteed the indebtedness for borrowed money of any other person;
(ii) all leases relating to the Leased Real Property;
(iii) all Contracts that limit or restrict the Company or any of its Subsidiaries from engaging in any line of business or in any jurisdiction or, other than a Contract entered into in the Ordinary Course, from soliciting or hiring any Person;
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(iv) all Contracts (other than any work orders, purchase orders, invoices and similar documents issued thereunder) for capital expenditures or the acquisition or construction of fixed assets requiring the payment by the Company or any of its Subsidiaries of an amount in excess of One Million Dollars ($1,000,000), individually, except any capital expenditures included in the Companys annual budget;
(v) all Contracts granting to any Person (other than the Company or any of its Subsidiaries) an option or a first refusal, first-offer or similar preferential right to purchase or acquire any material assets of the Company or any of its Subsidiaries;
(vi) all Contracts entered into since December 31, 2013 involving the purchase of substantially all of the assets or capital stock of any Person or a merger, consolidation, business combination or similar extraordinary transaction;
(vii) Contracts (other than any work orders, purchase orders, invoices and similar documents issued thereunder) for the provision of goods or services by the Company or any of its Subsidiaries to their customers, or to the Company or any of its Subsidiaries by their suppliers, that individually exceed One Million Five Hundred Thousand Dollars ($1,500,000) in the past twelve (12) months;
(viii) all Contracts to which the Company or any Subsidiary is a party pursuant to which a third party has licensed or transferred any material Intellectual Property to the Company or any Subsidiary or pursuant to which the Company or any Subsidiary has licensed, transferred or granted a covenant not to sue on, any material Owned Intellectual Property, excluding off the shelf Software licensed by the Company or its Subsidiaries;
(ix) all exchange traded or over-the-counter swap, forward, future, option, cap, floor or collar financial Contracts, or any other interest rate or foreign currency protection Contract having a notional amount that exceeds Two Hundred Fifty Thousand Dollars ($250,000);
(x) any partnership, limited liability company or joint venture agreement;
(xi) any Contract providing for the sale, assignment, lease, license or other disposition of any asset of the Company or any of its Subsidiaries with a value in excess of $500,000, except for sales of inventory in the Ordinary Course;
(xii) any Contract, other than contracts with customers and suppliers entered into in the Ordinary Course, wherein the Company or any of its Subsidiaries has agreed to, or assumed, any obligation or duty to indemnify, reimburse, hold harmless, guarantee or otherwise assume or incur any liability or obligation of any Person; and
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(xiii) any Contract not listed in clauses (i) through (xii) above that is material to the Company and its Subsidiaries, taken as a whole.
(b) Correct and complete copies of all Company Contracts, including all amendments, modifications, and supplements thereof (other than any work orders, purchase orders, invoices and similar documents issued thereunder), have been made available to the Purchaser. Each Company Contract is valid, binding and enforceable in all material respects in accordance with its terms with respect to the Company or any of its Subsidiaries, as applicable, and to the Knowledge of the Company, each other party to such Company Contracts. Except as set forth in Section 4.13(b) of the Disclosure Schedule, there is no existing material default or material breach (i) by the Company or any of its Subsidiaries, as applicable, under any Company Contract or (ii) to the Companys Knowledge, by any other party to any Company Contract described in Section 4.13(a) hereof. No party to a Company Contract has given written notice of any significant dispute with respect to any Company Contract. Section 4.13(a) of the Disclosure Schedule identifies with an asterisk (*) each Company Contract set forth therein that requires the consent of or notice to the other party thereto to avoid any material breach, material default or material violation of such Contract in connection with the transactions contemplated by this Agreement. Except as set forth on Section 4.13(b) of the Disclosure Schedule, no Company Contract is with a DMS Entity and no Company Contract relates in any way to the business conducted by the DMS Entities.
Section 4.14 Tax Returns; Taxes.
(a) Except as set forth on Section 4.14(a) of the Disclosure Schedule, all Tax Returns required to be filed by the Company and its Subsidiaries have been timely and properly filed (taking into account extensions of time to file) with the appropriate Taxing Authority in accordance with all applicable Laws, and all such Tax Returns are true, correct and complete in all material respects. Each of the Company and its Subsidiaries has timely and properly paid all material Taxes to the appropriate Taxing Authority whether or not shown as due and payable on any Tax Return, and in the case of Taxes not yet due and payable, the Company has provided adequate accruals in the Balance Sheet or, in the case of Taxes accruing after the date of the Balance Sheet and through the Closing Date, on its books or accounts. Neither the Company nor any of its Subsidiaries is currently the beneficiary of any extension of time within which to file any Tax Return.
(b) There are no Liens, other than Permitted Liens, relating to Taxes existing, threatened or pending with respect to any asset of the Company or any of its Subsidiaries.
(c) The Company and each of its Subsidiaries has timely and properly withheld or collected all material Taxes required to be withheld or collected, and all such Taxes have been timely and properly paid over to the appropriate Taxing Authority.
(d) The Company and each of its Subsidiaries has timely filed or provided all information, returns or reports, including Forms 1099 and W-2 (and foreign, state and local equivalents) that are required to have been filed or provided and has accurately reported all information required to be included on such returns or reports.
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(e) No Tax Return of the Company or any of its Subsidiaries has ever been audited by any Taxing Authority and no such audit has been threatened against or with respect to the Company or any of its Subsidiaries by any Taxing Authority.
(f) No written request for information related to Taxes has been received from any Taxing Authority since December 31, 2012, and no claim has been made by any Taxing Authority in a jurisdiction where the Company or any of its Subsidiaries does not file Tax Returns that it was, is or may be, subject to taxation by that jurisdiction.
(g) All deficiencies proposed or asserted, and all assessments made have been timely and fully paid to the appropriate Taxing Authority, and there are no other claims or assessments pending or threatened against the Company or any of its Subsidiaries in respect of Taxes. There are no outstanding agreements or waivers extending the statutory period of limitation applicable to any claim for, or the period for the collection or assessment of, Taxes due from or with respect to the Company or any of its Subsidiaries.
(h) Neither the Company nor any of its Subsidiaries is or has ever been a member of an affiliated group (within the meaning of Section 1504(a) of the Code or similar group defined under any similar provision of foreign, state or local Law), consolidated group, combined group or unitary group for any taxable period, and neither the Company nor any of its Subsidiaries has any liability or obligation for the Taxes of any other Person under Treasury Regulations Section 1.1502-6 (or any similar provision of any foreign, state or local Law), as a transferee or successor, by agreement or otherwise, in each case, other than any group of which the Company or one of its Subsidiaries is or has been the parent.
(i) Neither the Company nor any of its Subsidiaries will be required to include any item of income in, or exclude any item of deduction from, taxable income for any period or portion thereof ending after the Closing Date (i) under Section 481 of the Code (or any similar provision of any foreign, state or local Law) as a result of change in method of accounting for a Pre-Closing Period, (ii) pursuant to the provisions of any agreement entered into with any Taxing Authority or pursuant to a closing agreement as defined in Section 7121 of the Code (or any similar provision of any foreign, state or local Law) executed on or prior to the Closing Date, (iii) as a result of any intercompany transactions or any excess loss account described in Treasury Regulations Section 1.1502-19 (or any similar provision of any foreign, state or local Law), (iv) as a result of the installment method of accounting, the completed contract method of accounting or the cash method of accounting with respect to a transaction that occurred prior to the Closing Date, (v) as a result of any prepaid amount received on or prior to the Closing Date, (vi) as a result of any election under Section 108(i) of the Code (or any similar provision of any foreign, state or local Law) with respect to the discharge of any indebtedness on or prior to the Closing Date, (vii) as a result of amounts earned on or before the Closing Date pursuant to Section 951 of the Code, or (viii) as a result of any debt instrument held prior to the Closing that was acquired with original issue discount as defined in Section 1273(a) of the Code or subject to the rules set forth in Section 1276 of the Code.
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(j) Neither the Company nor any of its Subsidiaries is a party to any Tax sharing, allocation or indemnity agreement, arrangement or similar contract.
(k) Neither the Company nor any of its Subsidiaries has distributed the stock of another Person, or has not had its stock distributed by another Person, in a transaction that was purported or intended to be governed in whole or in part by Sections 355 or 361 of the Code.
(l) The Company has not been a United States real property holding corporation within the meaning of Section 897(c)(2) of the Code during the applicable period specified in Section 897(c)(1)(A)(ii) of the Code.
(m) Neither the Company nor any of its Subsidiaries has, nor has it ever had, a permanent establishment in any country, as such term is defined in any applicable Tax treaty or convention, nor has it otherwise taken steps that have exposed, or will expose, it to the taxing jurisdiction of any country, other than the country under which the Company or such Subsidiary is legally formed.
(n) Neither the Company nor any of its Subsidiaries is the beneficiary of any Tax incentive, Tax rebate, Tax holiday or similar arrangement or agreement with any Governmental Entity.
(o) The Company and each of its Subsidiaries computes its taxable income using the accrual method of accounting.
(p) Other than as set forth on Section 4.14(p) of the Disclosure Schedules, the Company will not, as a result of the transactions contemplated by this Agreement, be obligated to make a payment to an individual or individuals that would be nondeductible by reason of Section 280G or Section 4999 of the Code (or any similar provision of state, local or foreign Law).
(q) Neither the Company nor any Subsidiary is, or has ever been, a party to, or a promoter of, a reportable transaction or a listed transaction within the meaning of Section 6707A of the Code and Treasury Regulations Section 1.6011-4 (or any predecessor provision).
Section 4.15 Company Benefit Plans.
(a) Section 4.15(a) of the Disclosure Schedule contains a complete and correct list of all material Company Benefit Plans. The Company and its Subsidiaries have no material liability with respect to any plan, policy program or Agreement of the type set forth on Section 4.15(a) of the Disclosure Schedule other than the Company Benefit Plans. The Company has made available via the data room to the Purchaser, with respect to all such material Company Benefit Plans true, complete and correct copies of the following, to the extent applicable: all plan documents and amendments thereto; the most recent summary plan descriptions and any subsequent summaries of material modifications; Forms 5500 series as filed with the IRS for the three (3) most recent plan years for any Company Benefit Plan to which such reporting requirements apply and
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each trust agreement, insurance or group annuity contract and other documents relating to the funding or payment of benefits under any Company Benefit Plan; and any other documents, forms or other instruments reasonably requested by Purchaser.
(b) With respect to each Company Benefit Plan, whether or not required to be listed on Section 4.15(a) of the Disclosure Schedule: (i) each such Company Benefit Plan has been administered in compliance in all material respects with its terms and is in compliance in all material respects with the applicable provisions of ERISA, the Code and all other applicable Laws (including reporting and disclosure obligations and health care continuation coverage obligations pursuant to COBRA); (ii) there are no proceedings, investigations, claims or suits pending or, to the Companys Knowledge, threatened by any Governmental Entity or by any participant or beneficiary (other than routine claims for benefits) against any of the Company Benefit Plans; and (iii) to the Companys Knowledge no Person has breached any of the duties imposed upon fiduciaries (within the meaning of Section 3(21) of ERISA) by ERISA or entered into any non exempt prohibited transactions as such term is defined in ERISA or the Code, with respect to such Company Benefit Plan.
(c) Each Company Benefit Plan that is intended to qualify under Section 401(a), Section 401(k), Section 401(m) or Section 4975(e)(7) of the Code has either (i) received a favorable determination letter from the IRS as to its qualified status or (ii) may rely upon a favorable prototype opinion letter from the IRS, and to the Companys Knowledge, no fact or event has occurred that would adversely affect the qualified status of any such Company Benefit Plan or the exempt status of any such trust.
(d) Except as required by COBRA or similar Law, no Company Benefit Plan provides any post-termination medical, life insurance or other welfare-type benefits to any Person. No Company Benefit Plan is a voluntary employee benefit association under Section 501(a)(9) of the Code. Except as would give rise to no Liability to the Company, neither the Company nor any of its Subsidiaries (nor (within the past six (6) years) any member of their respective Controlled Groups) has ever maintained, sponsored, participated in or contributed to (or been required to contribute to) any (i) Employee Benefit Plan subject to the funding requirements of Section 412 of the Code or Section 302 or Title IV of ERISA,; (ii) multiemployer plan (as defined in Section 3(37) of ERISA); (iii) defined benefit plan within the meaning of Section 3(35) of ERISA; or (iv) multiple employer plan within the meaning of Section 210(a) of ERISA or Section 413(c) of the Code.
(e) The execution and performance of this Agreement will not (i) constitute a stated triggering event under any Company Benefit Plan that will result in any payment (whether of severance pay or otherwise) becoming due from the Company or any of its Subsidiaries to any current or former officer, employee, director or consultant (or dependents of such Persons), or (ii) accelerate the time of payment or vesting, or increase the amount of compensation due to any current or former officer, employee, director or consultant (or dependents of such Persons) of the Company or its Subsidiaries. No individual has a right to any gross up or indemnification from the Company or any of its Subsidiaries with respect to any Company Benefit Plan.
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(f) To the extent that any Company Benefit Plan constitutes a non-qualified deferred compensation plan within the meaning of Section 409A of the Code, such Company Benefit Plan complies and has complied in both form and operation with the requirements of Section 409A of the Code.
Section 4.16 Labor Relations. Except as set forth in Section 4.16 of the Disclosure Schedule: (a) neither the Company nor any of its Subsidiaries (i) is a party to any collective bargaining agreement or other legally binding commitment, with any trade union, employee organization or workers council in respect of or affecting employees, (ii) has breached any collective bargaining agreement or other legally binding commitment with any trade union, employee organization or workers counsel in respect of or affecting employees, or (iii) is currently engaged in any negotiation with any trade union, employee organization or workers council; (b) neither the Company nor any Subsidiary has experienced any labor strike, dispute, slowdown or stoppage; (c) no claim, complaint or charge (or, to the Knowledge of the Company, investigation) is pending or, to the Knowledge of the Company, threatened by any Person against the Company or any Subsidiary under any Labor Law; and (d) neither the Company nor any Subsidiary has implemented any location closing, mass layoff, or redundancy of employees that could require notice and/or consultation under any Labor Laws (including the WARN Act, or any similar Law). True and complete copies of all material written personnel manuals, employee handbooks, and personnel policies applicable to employees have been made available via the data room to the Purchaser.
Section 4.17 Insurance Policies. Section 4.17 of the Disclosure Schedule contains a true and complete list of all material insurance policies carried as of the date hereof by or for the benefit of the Company or any of its Subsidiaries, specifying the insurer, the amount of and nature of coverage, the risk insured against, the deductible amount (if any) and the date through which coverage shall continue by virtue of premiums already paid. All insurance policies with respect to the business and assets of the Company and its Subsidiaries are in full force and effect in all material respects. All premiums due have been paid on such insurance policies, and neither the Company nor any of its Subsidiaries has received any written notice of cancellation of any such insurance policy or written notice with respect to any refusal of coverage thereunder.
Section 4.18 Environmental Matters. Except as disclosed in Section 4.18 of the Disclosure Schedule: (a) the Company and each of its Subsidiaries possess all Licenses required under Environmental Laws and each is and for the past five (5) years has been in material compliance with all Environmental Laws and any such Licenses; (b) neither the Company nor any of its Subsidiaries has received written notice of actual or threatened liability under Environmental Laws from any Governmental Entity or from any other Person or party in the past five (5) years or prior to that date if not fully resolved with no further liability or obligations, including for a Release of Hazardous Materials at any location; (c) (i) neither the Company nor any of its Subsidiaries has entered into any consent decree or order pursuant to any Environmental Law, and (ii) neither the Company nor any of its Subsidiaries is a party to any judgment, decree or judicial or administrative order pursuant to any Environmental Law, in each case (i) or (ii), in the past five (5) years or prior to that date if not fully resolved with no further liability or obligations; (d) there has been no Release of Hazardous Materials on or from the Real Property or any property or facility formerly owned, leased or operated by the Company or any
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of its Subsidiaries that would reasonably be expected to result in material liability to the Company or any of its Subsidiaries or that requires notification to any Governmental Entity or investigation, removal, response action, correction action or remediation under Environmental Laws or pursuant to any contractual obligations; (e) neither the Company nor any of its Subsidiaries has paid any fine or penalty within the prior three (3) years for a violation of any Environmental Law; (f) neither the Company nor any of its Subsidiaries has assumed, undertaken, or agreed to indemnify, in each case pursuant to any contractual obligations, any material liability of any other Person relating to or arising from any Environmental Law; (g) the operations and products of the Company and each of its Subsidiaries have not given rise to exposures of employees or other persons to Hazardous Materials in excess of any applicable limits or standards under Environmental Laws; (h) neither the Company nor any of its Subsidiaries has sold, marketed, manufactured or distributed any product that contains or utilizes asbestos or asbestos-containing materials; and (i) the Company and its Subsidiaries have provided, or caused to be provided, to the Purchaser copies of all material documents and records in its possession or reasonable control concerning any actual or potential material liability of the Company or any of its Subsidiaries under Environmental Laws, including arising from any Release or threat of Release of Hazardous Materials at, upon or from the Real Property or any property formerly owned, leased or operated by the Company or any of its Subsidiaries, and including any previously conducted material environmental site assessments, compliance audits, asbestos surveys, or environmental reports by Governmental Entities, and material correspondence with Governmental Entities regarding compliance with or liability of the Company or any of its Subsidiaries under Environmental Laws or Licenses.
Section 4.19 Intellectual Property.
(a) Section 4.19(a) of the Disclosure Schedule contains a correct and complete list of all Company Registered Intellectual Property and all material unregistered copyrights, trademarks and service marks of the Company and any of its Subsidiaries.
(b) Except as set forth in Section 4.19(b) of the Disclosure Schedule, no material Company Proprietary Software or other material Intellectual Property owned by the Company or any of its Subsidiaries is subject to any proceeding or outstanding consent, decree, order or judgment (i) restricting in any manner the use thereof by the Company or any of its Subsidiaries or (ii) that may affect the validity, use or enforceability thereof.
(c) Each item of Company Registered Intellectual Property is subsisting and in full force in all material respects. Except as set forth in Section 4.19(c) of the Disclosure Schedule, all necessary registration, maintenance and renewal fees currently due and owing in connection with Company Registered Intellectual Property have been paid and all necessary documents, recordations and certifications in connection with the Company Registered Intellectual Property have been filed with the relevant patent, copyright, trademark or other authorities in the United States or foreign jurisdictions, as the case may be, for the purposes of maintaining such Company Registered Intellectual Property and recording ownership by the Company or any of its Subsidiaries of such Company Registered Intellectual Property.
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(d) Except as set forth in Section 4.19(d) of the Disclosure Schedule, the Company is the sole and exclusive owner of each item of Intellectual Property used by the Company or any of its Subsidiaries, other than Intellectual Property that is licensed to the Company or any of its Subsidiaries and Intellectual Property that is available to the Company or any of its Subsidiaries without the requirement of a license, free and clear of any Lien except Permitted Liens.
(e) The operations of the Company and its Subsidiaries as currently conducted, including the Companys and its Subsidiaries products and services, do not infringe or misappropriate the Intellectual Property of any third party in any material respect. Neither the Company nor any of its Subsidiaries has, during the three (3) year period preceding the Closing, received written notice that its activities may infringe or violate the Intellectual Property rights of any third party.
(f) The consummation of the transactions contemplated by this Agreement will neither violate nor result in the breach, modification, cancellation, termination or suspension of any Contract with any Customer or Supplier granting the Company or any of its Subsidiaries rights in the Company Intellectual Property, except as would not be material to the Company or any of its Subsidiaries.
(g) Except as set forth in Section 4.19(g) of the Disclosure Schedule, to the Knowledge of the Company, no Person is infringing or misappropriating any Company Intellectual Property that is owned by or exclusively licensed to the Company or any of its Subsidiaries.
(h) The Company and its Subsidiaries have taken reasonable steps to protect their respective rights in the Confidential Information and any trade secret or confidential information of third parties used by the Company or any Subsidiary, and, without limiting the generality of the foregoing, the Company and each Subsidiary have used commercially reasonable efforts to enforce a policy requiring employees, agents, consultants, contractors and other Persons with responsibility for the development of Intellectual Property for the Company or any Subsidiary to execute a proprietary information/confidentiality agreement in substantially the form provided to the Purchaser, and, except under confidentiality obligations, there has not been any disclosure by the Company or any Subsidiary of any material Confidential Information or any such trade secret or material confidential information of third parties as has been or would reasonably be expected to be material to the Company and its Subsidiaries, taken as a whole.
(i) Except as set forth in Section 4.19(i) of the Disclosure Schedule, no Company Intellectual Property used in connection with the AT Business is owned, licensed or otherwise used by any DMS Entity.
Section 4.20 Software.
(a) Section 4.20(a) of the Disclosure Schedule sets forth a correct and complete list of the material Company Proprietary Software currently licensed by the
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Company or any of its Subsidiaries, none of which is licensed by any DMS Entity except as pursuant to the Transition Services Agreement.
(b) Except as set forth in Section 4.20(b) of the Disclosure Schedule, none of such Company Proprietary Software is subject to any copyleft or other obligation or condition (including any obligation or condition under any open source license such as the GNU Public License, Lesser GNU Public License or Mozilla Public License) that requires, or conditions the use or distribution of such Company Proprietary Software on, the disclosure, licensing or distribution of any source code for any portion of such Company Proprietary Software.
(c) Except as set forth in Section 4.20(c) of the Disclosure Schedule, the source code for such Company Proprietary Software currently in use by the Company or any Subsidiary is maintained in confidence and the Company is not obligated to place it in escrow.
Section 4.21 FDA Compliance.
(a) The Company and its Subsidiaries are currently conducting, and have conducted, their business and operations in compliance in all material respects with all applicable provisions of the Federal Food, Drug, and Cosmetic Act, 21 U.S.C. §§ 301 et seq., all applicable regulations promulgated by the United States Food and Drug Administration or any similar foreign Governmental Entity, as applicable (FDA), and all other FDA Laws. Except as identified on Section 4.21(a) of the Disclosure Schedule, neither the Company nor its Subsidiaries have received in the past five (5) years any written notice, Form FDA-483, FDA warning letters or untitled letters, from the FDA alleging or asserting non-compliance with any applicable FDA Law or any other communication alleging actual or potential violations of FDA Law. Neither the Company nor any of its Subsidiaries have entered into any consent decree or order pursuant to any FDA Law, and neither the Company nor any of its Subsidiaries is a party to any judgment, decree, or judicial or administrative order pursuant to any FDA Law. There is no civil, criminal or administrative action, suit, demand, claim, complaint, hearing, investigation, demand letter, warning letter, Form FDA 483, proceeding or request for information pending against the Company or its Subsidiaries and neither the Company nor any of its Subsidiaries have any material liability (whether actual or contingent) for failure to comply with any FDA Law. To the Companys Knowledge, there is no act, omission, event, or circumstance that would reasonably be expected to give rise to or lead to any such action, suit, demand, claim, complaint, hearing, investigation, notice, demand letter, warning letter, proceeding or request for information or any such liability.
(b) The Company and its Subsidiaries do not manufacture, market or distribute any FDA regulated products that either require or are the subject of applicable FDA clearances, approvals, licenses, or permits, as the case may be, that are owned by the Company or its Subsidiaries, or any FDA products that are owned by the Company or its Subsidiaries and exempt from such FDA clearance, approval, license or permit requirements in accordance with FDA Law. To the Companys Knowledge, all finished
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FDA regulated products that are contract manufactured, prepared or propagated by the Company or its Subsidiaries are the subject of an appropriate clearance or approval issued by FDA, as required, and duly held by the party for whom the Company or its Subsidiaries is manufacturing, preparing or propagating such finished FDA regulated product, or such product is otherwise exempt from such FDA clearance, approval, license or permit requirements in accordance with FDA Laws. The Company and its Subsidiaries have obtained and maintained in full force and effect, all necessary establishment registrations, and device listings needed for the continuing operation of the AT Business and the business conducted by the DMS Entities, in each case, as listed on Section 4.21(b) of the Disclosure Schedule.
(c) Except where any such non-compliance has not been and would not reasonably be expected to be material to the Company and its Subsidiaries, taken as a whole, the Company and its Subsidiaries are and have each been for the past five (5) years, in compliance with, and each product of the Company and its Subsidiaries subject to regulation by the FDA that is in commercial distribution while in the care, custody and control of the Company and its Subsidiaries have been designed (to the extent that such design is under the control of the Company or any of its Subsidiaries), manufactured, prepared, assembled, packaged, labeled, stored, and processed in compliance with current Good Manufacturing Practices, including, where applicable the Quality System Regulation. With respect to articles that are manufactured or assembled by the Company or its Subsidiaries that are not finished products (e.g., components), and where such compliance is required by contract, the Company and its Subsidiaries have operated in compliance with, and each component while in the care, custody and control of the Company or its Subsidiaries has, as applicable, been manufactured, prepared, assembled, packaged, labeled, stored and processed in compliance in all material respects with current Good Manufacturing Practices, including, where applicable, the Quality System Regulation.
(d) The Company and its Subsidiaries have made all material notifications, submissions and reports to the FDA required by FDA Law, and all such notifications, submissions and reports were true, complete and correct in all material respects as of the date of submission to the FDA (or were corrected or supplemented by a subsequent notification, submission or report). Neither the Company nor its Subsidiaries have made any untrue statement of a material fact or fraudulent statement to the FDA; failed to disclose a material fact required to be disclosed to the FDA; or committed an act, made a statement, or failed to make a statement that, at the time such disclosure was made, would reasonably be expected to provide a basis for the FDA to invoke its policy respecting Fraud, Untrue Statements of Material Facts, Bribery, and Illegal Gratuities, set forth in 56 Fed. Reg. 46191 (September 10, 1991).
(e) Neither the Company nor any Subsidiaries nor any of its employees and to the Companys Knowledge, any of its contractors, has been, or to the Companys Knowledge, is in anticipation of being debarred pursuant to the Generic Drug Enforcement Act of 1992 (21 U.S.C. § 335a(m)).
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(f) With the exception of those items identified on Section 4.21(f) of the Disclosure Schedule, none of the Company, its Subsidiaries, or, to the Companys Knowledge, any of their customers, has undertaken a recall, field correction, removal or withdrawal of any: (i) products (e.g., finished medical devices or components) manufactured by the Company or its Subsidiaries or (ii) finished medical devices that incorporate the Companys or its Subsidiaries manufactured products (e.g., components) due to the failure of any such Companys or Subsidiaries manufactured products failure to meet specifications or otherwise perform as intended, nor have any such products been seized, detained, subject to suspension of manufacturing or termination or suspension of marketing. To the Companys Knowledge, there are no facts or circumstances reasonably likely to cause such recall, field correction, removal, withdrawal, seizure, detention, suspension of manufacturing or termination or suspension of marketing of any product.
(g) The Company and its Subsidiaries have not conducted any clinical studies in the United States nor sponsored the conduct of any clinical research in the United States.
Section 4.22 Brokers, Finders and Investment Bankers. Except as set forth in Section 4.22 of the Disclosure Schedule, none of the Company, any of its Subsidiaries, or any officer, director or employee of the Company or any of its Subsidiaries or any Affiliate of the Company or any of its Subsidiaries, has employed any broker, finder or investment banker or incurred any liability for any investment banking fees, financial advisory fees, brokerage fees or finders fees in connection with the transactions contemplated hereby.
Section 4.23 Officers and Select Employees. Section 4.23 of the Disclosure Schedule contains a correct and complete list of (a) all of the officers of the Company and each of its Subsidiaries and (b) all of the other employees of the Company and each of its Subsidiaries as of the date hereof who have received a base salary in excess of Two Hundred Thousand Dollars ($200,000) for the twelve (12) month period ended June 30, 2016, together with an appropriate notation next to the name of any officer or other employee on such list who is subject to any Employment Agreement. There is no existing material default or material breach of the Company or any of its Subsidiaries, as applicable, under any Employment Agreement (or event or condition that, with notice or lapse of time or both would constitute a material default or material breach).
Section 4.24 Customer and Supplier Relations. Section 4.24(a) of the Disclosure Schedule contains a correct and complete list of the identity of the Customers and Suppliers, and the amount of sales to or purchases from each such Customer or Supplier during the twelve (12) month period ended June 30, 2016. Except as set forth in Section 4.24(b) of the Disclosure Schedule, no Customer or Supplier has, as of the date hereof, canceled, terminated or made any written threat to cancel or otherwise terminate any of its Contracts with the Company or its Subsidiaries or to materially decrease its usage or supply of the Companys or its Subsidiaries services or products. The Company has no Knowledge as of the date hereof to the effect that any current Customer or Supplier intends to terminate or materially alter its business relations with the Company or any of its Subsidiaries, either as a result of the transactions contemplated by this Agreement or otherwise.
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Section 4.25 Transactions with Affiliates. Except (x) as set forth in Section 4.25 of the Disclosure Schedule, (y) with respect to compensation received as employees and (z) Contracts entered into on an arms length basis and in the ordinary course of business between the Company or one of its Subsidiaries, on the one hand, and any of the direct or indirect portfolio companies of investment funds advised or managed by KRG Capital Management, L.P. or an Affiliate thereof, on the other hand, no officer or director of the Company, any of its Subsidiaries or any Affiliate of any of them, and no Person with whom any such officer or director has any direct or indirect relation by blood, marriage or adoption, has any interest in: (a) any material Contract with, or relating to, the Company or any of its Subsidiaries or the material properties or assets of the Company or any of its Subsidiaries; (b) any material Contract for or relating to the Company or any of its Subsidiaries or the material properties or assets of the Company or any of its Subsidiaries; or (c) any material property (real, personal or mixed), tangible or intangible, used or currently intended to be used by the Company or any of its Subsidiaries.
Section 4.26 Investment Company. Neither the Company nor any of its Subsidiaries is an investment company or a company controlled by an investment company within the meaning of the Investment Company Act of 1940, as amended.
ARTICLE V
REPRESENTATIONS AND WARRANTIES OF THE PURCHASER AND MERGER SUB
The Purchaser and Merger Sub hereby, jointly and severally, represent and warrant to the Company that as of the date hereof and as of the Closing Date:
Section 5.1 Organization. The Purchaser is a corporation duly organized, validly existing and in good standing under the laws of the State of Ohio and has all requisite corporate power and authority to own, lease and operate its properties and to carry on its business as now being conducted. Merger Sub is a corporation duly organized, validly existing and in good standing under the laws of the State of Delaware. Merger Sub has been formed solely for the purpose of engaging in the transactions contemplated hereby, and as of the Effective Time, will have engaged in no other business or other activities or incurred any liabilities, other than in connection with or as contemplated by this Agreement. The Purchaser owns, and immediately prior to the Effective Time shall continue to own, of record and beneficially, all outstanding shares of capital stock of Merger Sub.
Section 5.2 Authorization. The Purchaser and Merger Sub each have all necessary corporate power and authority to execute and deliver this Agreement and each Purchaser Ancillary Document and to perform its obligations hereunder and thereunder, subject to obtaining the requisite stockholder approval of Merger Sub, and to consummate the transactions contemplated hereby and thereby. The execution, delivery and performance by each of the Purchaser and Merger Sub of this Agreement and the Purchaser Ancillary Documents, and the consummation by them of the Merger, have been duly authorized and approved by each of the Purchasers and Merger Subs board of directors, and except for obtaining the requisite stockholder approval of Merger Sub, no other corporate action on the part of the Purchaser or Merger Sub is necessary to authorize the execution, delivery and performance by the Purchaser or Merger Sub of this Agreement and the Purchaser Ancillary Documents, and the
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consummation by them of the Merger. This Agreement has been and, as of the Closing Date, the Purchaser Ancillary Documents shall be, duly executed and delivered by each of the Purchaser and Merger Sub and, assuming due authorization, execution and delivery hereof and thereof by the other parties hereto and thereto, do or will, as the case may be, constitute the valid and binding agreement of each of the Purchaser and Merger Sub, enforceable against the Purchaser and Merger Sub in accordance with their terms, except as such enforceability (i) may be limited by bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium or other similar Laws affecting or relating to enforcement of creditors rights generally and (ii) is subject to general principles of equity (regardless of whether enforceability is considered in a proceeding at law or in equity).
Section 5.3 Absence of Restrictions and Conflicts.
(a) Subject to obtaining the requisite stockholder approval of Merger Sub, the execution and delivery by the Purchaser and Merger Sub of this Agreement and the Purchaser Ancillary Documents does not, and the performance of their respective obligations hereunder and thereunder will not, (i) conflict with or violate the articles of incorporation, regulations or bylaws of the Purchaser or Merger Sub, (ii) assuming that all consents, approvals, authorizations, waiting period terminations or expirations, and other actions described in Section 5.3(b) have been obtained and all filings and obligations described in Section 5.3(b) have been made, conflict with or violate any Law applicable to the Purchaser or Merger Sub, or by which any material property or asset of the Purchaser or Merger Sub, is bound and (iii) require any consent or result in any violation or breach of or constitute (with or without notice or lapse of time or both) a default (or give to others any right of termination, amendment, acceleration or cancellation) under, or result in the triggering of any payments or result in the creation of a Lien on any property or asset of the Purchaser or Merger Sub, in all cases, pursuant to any of the terms, conditions or provisions of any (A) Contract applicable to the Purchaser or Merger Sub or (B) judgment, decree or order of any Governmental Entity, to which the Purchaser or Merger Sub is a party or by which the Purchaser, Merger Sub or any of their respective properties or assets are bound, except, with respect to clause (iii), for any such triggering of payments or creation of Liens which have not and would not reasonably be expected to, individually or in the aggregate, prevent or materially delay consummation of the Merger and the other transactions contemplated by this Agreement.
(b) The execution and delivery by the Purchaser and Merger Sub of this Agreement do not, and the performance of their obligations hereunder will not, require any consent, approval, authorization or permit of, or filing with, or notification to, any Governmental Entity, except for (i) the pre-merger notification requirements of the HSR Act, (ii) obtaining the requisite stockholder approval of Merger Sub, (iii) the filing of a Certificate of Merger with, and the acceptance for record thereof by, the Secretary of State of the State of Delaware and (iv) as otherwise set forth on Section 5.3(b) of the Disclosure Schedule.
Section 5.4 Financial Capacity; Solvency.
(a) The Purchaser and Merger Sub affirm that it is not a condition to Closing or to the performance of any of its obligations under this Agreement that the Purchaser or Merger Sub obtain financing for the transactions contemplated by this Agreement.
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(b) Assuming the accuracy of the representations and warranties in ARTICLE IV, immediately following the Closing, the Company will be Solvent. For purposes of this Agreement, Solvent when used with respect to the Company, means that, immediately following the Closing Date, (i) the amount of the Present Fair Salable Value of its assets will, as of such date, exceed all of its liabilities, contingent or otherwise, as of such date, (ii) the Company will not have, as of such date, an unreasonably small amount of capital for the business in which it is engaged or will be engaged and (iii) the Company will be able to pay its Debts as they become absolute and mature, taking into account the timing of and amounts of Cash to be received by it and the timing of and amounts of Cash to be payable on or in respect of its indebtedness. The term Solvency shall have its correlative meaning. For purposes of the definition of Solvent, (A) Debt means liability on a Claim and (B) Claim means (1) any right to payment, whether or not such a right is reduced to judgment, liquidated, unliquidated, fixed, contingent, matured, unmatured, disputed, undisputed, legal, equitable, secured or unsecured or (2) the right to an equitable remedy for breach of performance if such breach gives rise to a right to payment, whether or not such equitable remedy is reduced to judgment, liquidated, unliquidated, fixed, contingent, matured, unmatured, disputed, undisputed, legal, equitable, secured or unsecured. Present Fair Salable Value means the amount that may be realized if the aggregate assets of the Company are sold as an entirety with reasonable promptness in an arms length transaction under present conditions for the sale of comparable business enterprises.
Section 5.5 Legal Proceedings. There is no suit, action, claim, arbitration or proceeding by or before any Governmental Entity pending or, to the Knowledge of the Purchaser, threatened against the Purchaser, any of its Subsidiaries (including Merger Sub) or any property of any thereof which would reasonably be expected to prevent or materially delay consummation of the Merger and the other transactions contemplated by this Agreement. Neither the Purchaser nor any of its Subsidiaries (including Merger Sub) is subject to any judgment, decree, injunction, rule or order of any court or arbitration panel.
Section 5.6 Investment Intent. The Purchaser is acquiring the shares of capital stock of the Company pursuant to this Agreement solely for its own account and with no intention of distributing or reselling such shares or any part thereof, or interest therein, in any transaction that would be in violation of the Securities Act of 1933 (the Securities Act) or any other securities Laws of the United States of America or any state thereof.
Section 5.7 Status as Accredited Investor. The Purchaser is an accredited investor (as that term is defined in Rule 501 of Regulation D under the Securities Act). The Purchaser has such knowledge and experience in business and financial matters so that the Purchaser is capable of evaluating the merits and risks of an investment in the shares being acquired hereunder. The Purchaser understands the full nature and risk of an investment in such shares.
Section 5.8 Brokers, Finders and Investment Bankers. Except as set forth on Section 5.8 of the Disclosure Schedule, neither the Purchaser nor any of its Affiliates has employed any broker, finder or investment banker or incurred any liability for any investment banking fees, financial advisory fees, brokerage fees or finders fees in connection with the transactions contemplated hereby.
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Section 5.9 Reliance; Inspection. The Purchaser has made its own inquiry and investigation into, and based thereon, has formed an independent judgment concerning, the Company, its Subsidiaries, the DMS Entities, the Merger and the transactions contemplated by this Agreement and has been furnished with, or given adequate access to, such information about the Company, its Subsidiaries and the DMS Entities as it has requested. In making its decision to execute and deliver this Agreement and to consummate the transactions contemplated hereby, each of the Purchaser and Merger Sub represents, warrants and agrees that it has (a) relied solely upon the representations and warranties of the Company set forth in ARTICLE IV and acknowledges that such representations and warranties are the only representations and warranties made by the Company, its Subsidiaries and the DMS Entities and (b) not relied upon any other information provided by, for or on behalf of the Company, any of its Subsidiaries or any of the DMS Entities, or their respective Representatives, to the Purchaser, Merger Sub or any of their Representatives in connection with the transactions contemplated by this Agreement, including (i) the accuracy or completeness of any express or implied representation, warranty, statement of information of any nature made or provided by the Stockholders or the Company (other than the representations and warranties of the Company set forth in ARTICLE IV) or (ii) any implied warranty or representation as to the condition, merchantability, suitability or fitness for a particular purpose or trade as to any of the assets of the Company, any of its Subsidiaries or any of the DMS Entities. The Purchaser hereby waives any right Purchaser may have against the Company or the Stockholders with respect to any inaccuracy in any such representation, warranty or statement of information of any nature (other than the representations and warranties of the Company set forth in ARTICLE IV) or with respect to any omission of any material information on the part of the Company, the Stockholders or any of their respective Representatives. The Purchaser has entered into the transactions contemplated by this Agreement with the understanding, acknowledgement and agreement that no representations or warranties, express or implied, are made with respect to (x) any future projections, business plan information, estimates, forecasts, budgets, pro-forma financial information or other similar statements communicated (orally or in writing) or provided to the Purchaser or any of its Representatives of future revenues, profitability, expenses or expenditures, future results of operations (or any component thereof) or future cash flows of the Company, its Subsidiaries and the DMS Entities or (y) any other information, documents or other materials (including any such materials contained in any electronic data room or reviewed by the Purchaser or any of its Affiliates or Representatives pursuant to the Confidentiality Agreement) or management presentations that have been or shall hereafter be provided to the Purchaser or any of its Affiliates or Representatives except as may be expressly set forth in this Agreement or the Company Ancillary Documents. Except as otherwise expressly set forth in this Agreement or the Company Ancillary Documents, the Purchaser understands and agrees that the Company, its Subsidiaries and each of their respective assets are being furnished as is, where is and, subject to the representations and warranties contained in ARTICLE IV, with all faults and without any other representation or warranty of any nature whatsoever.
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ARTICLE VI
CERTAIN COVENANTS AND AGREEMENTS
Section 6.1 Ordinary Course Conduct of Business by the Company.
(a) For the period commencing on the date hereof and ending on the Closing Date, unless the Purchaser otherwise consents (which consent shall not be unreasonably withheld, conditioned or delayed) and except as (i) otherwise required to perform the obligations set forth in this Agreement or pursuant to Section 6.15, (ii) required by the Employee Benefits Plan or (iii) required by applicable Law, the Company and its Subsidiaries shall use reasonable best efforts to conduct their businesses in the Ordinary Course. Nothing contained herein shall give to the Purchaser, directly or indirectly, the right to control or direct the Companys or its Subsidiaries operations or businesses prior to the Effective Time, and the Company and its Subsidiaries shall exercise, consistent with the terms and conditions hereof, complete control and supervision of their operations and businesses until the Effective Time. Notwithstanding anything to the contrary set forth in this Agreement, no consent of the Purchaser shall be required with respect to any matter set forth in Section 6.1 or elsewhere in this Agreement to the extent that the requirement of such consent could violate any applicable Law.
(b) Without limiting Section 6.1(a), except as set forth on Section 6.1(b) of the Disclosure Schedule, for the period commencing on the date hereof and ending on the Closing Date, unless the Purchaser otherwise consents (which consent shall not be unreasonably withheld, conditioned or delayed), except as otherwise required by this Agreement including pursuant to obligations set forth in this Agreement or pursuant to Section 6.15, the Company and its Subsidiaries shall not:
(i) amend or authorize the amendment of its certificate of incorporation or bylaws (or equivalent organizational documents);
(ii) other than any cash dividends, declare, set aside, make, pay or effect any recapitalization, reclassification, stock dividend (or other distribution or payment), stock split, combination or like change in its capitalization or amend the terms of any outstanding securities of the Company or any of its Subsidiaries;
(iii) issue, sell or deliver any of the Companys or its Subsidiaries securities, securities convertible into equity securities or any options, warrants or other rights to purchase the Companys or its Subsidiaries equity securities;
(iv) enter into or agree to enter into any merger or consolidation with any Person, engage in any new business or invest in, make a loan, advance or capital contribution to, or otherwise acquire the securities or a substantial portion of the assets of, any other Person (other than any loan, advance or capital contribution between the Company and its Subsidiaries);
(v) make any change in any method of accounting or accounting policy other than as required by GAAP or applicable Law;
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(vi) (A) make any change in Tax reporting principles, practices or policies, including with respect to (x) depreciation or amortization policies or rates or (y) the payment of accounts payable or the collection of accounts receivable; (B) settle or compromise any Tax liability; (C) make, change or rescind any Tax election, (D) surrender any right in respect of Taxes, (E) consent to any extension or waiver of the limitation period applicable to any claim or assessment in respect of Taxes or (F) amend any Tax Return;
(vii) increase the compensation or benefits (including severance benefits) payable or to become payable to or grant any bonuses (including change in control, retention, transaction or stay bonuses) or salary increase to any of its officers, directors, employees, agents, independent contractors or consultants, enter into, amend or terminate any Employment Agreement or other agreement or employee benefit plan, make or amend any loans to any of its officers, directors, employees, affiliates, agents, independent contractors or consultants or make any change in its existing borrowing or lending arrangements for or on behalf of any of such Persons pursuant to an employee benefit plan or otherwise, in any case except (A) as required by applicable Law, (B) any annual salary increases made in the Ordinary Course or (C) payments relating to the transactions contemplated hereby that are to be paid at or prior to the Closing (but not after the Closing) and that do not exceed $50,000 per recipient or $500,000 in the aggregate;
(viii) hire or terminate (other than a termination for cause) any employee, officer, director, consultant or independent contractor of the Company or any of its Subsidiaries;
(ix) issue, create, incur, endorse, guarantee or assume any Indebtedness in excess of $250,000 (other than pursuant to Contracts entered into in the Ordinary Course) or Liens (other than Permitted Liens);
(x) make any loan or advance to any officer, director, employee or member of the Company or any of its Subsidiaries (except pursuant to an Employee Benefit Plan);
(xi) enter into, amend or terminate (A) a Company Contract other than in the Ordinary Course or (B) a Company Contract of the kind described in Sections 4.13(a)(iii), (v), (vi), (viii) or (x);
(xii) institute, settle or compromise any legal proceeding (other than matters (x) involving the payment of less than $300,000 by the Company or any of its Subsidiaries or (y) in respect of which the Company and its Subsidiaries are fully indemnified pursuant to the Lithotech Agreement) or waive or release any right or claim against a third Person;
(xiii) take any action which would, or would reasonably be expected to, adversely affect the ability of the Parties to consummate the Merger; or
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(xiv) agree or commit to do any of the actions set forth in clauses (i) through (xiii) above.
Section 6.2 Inspection and Access to Information.
(a) Subject to compliance with applicable Law, during the period commencing on the date hereof and ending on the Closing Date, the Company and its Subsidiaries will, and will instruct their respective officers, directors, employees, counsel, accountants, advisors, representatives and agents (collectively, Representatives) to, provide the Purchaser and its Representatives reasonable access, during normal business hours, without unreasonably interfering with the operation of the business of the Company and its Subsidiaries, to its premises, employees (including executive officers), properties, Contracts, commitments, books, records and other information (including Tax Returns filed and those in preparation) and will furnish to the Purchaser and its Representatives any and all available financial and operating data and other information pertaining to the Company or any of its Subsidiaries, in each case, as the Purchaser and its Representatives may reasonably request, including any information reasonably necessary for the Purchaser to timely prepare audited financial statements for the AT Business; provided, however, the Company, its Subsidiaries and their Representatives shall not be required to provide any information that (i) it reasonably believes it may not provide to the Purchaser by reason of contractual or legal restrictions, including applicable Laws, (ii) it believes is competitively sensitive information, except that such information will be provided only to the outside counsel of the Purchaser in accordance with the last sentence of this Section 6.2(a) or (iii) is protected by attorney-client or other legal privilege; provided, further, that, without limiting the foregoing, prior to any such access or provision of information, the Purchaser must obtain written permission therefor from the Chief Executive Officer, Chief Financial Officer or Corporate Counsel, as appropriate, of the Company; provided, further, that such investigation shall be conducted in accordance with all applicable antitrust Laws and shall be at the Purchasers sole cost and expense; and provided, further, that the Purchaser and its Representatives shall not be permitted to perform any environmental sampling at any Real Property, including sampling of soil, groundwater, surface water, building materials, or air or wastewater emissions. In addition, the Company may designate any competitively sensitive information provided to the Purchaser under this Agreement as being for outside counsel only and such information shall be given only to the outside counsel of the Purchaser and may not be shared with the Purchaser or its Representatives (other than such outside counsel).
(b) All information provided or obtained by the Company or its Subsidiaries (and the DMS Entities) and their respective Representatives to the Purchaser in connection with the transactions contemplated hereby will be held by the Purchaser in accordance with the letter agreement relating to confidentiality and nondisclosure obligations, dated September 14, 2016, between the Purchaser and the Company (the Confidentiality Agreement). In the event of a conflict or inconsistency between the terms hereof and the Confidentiality Agreement, the terms hereof will govern.
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Section 6.3 Government Filings and Approvals.
(a) Each Party promptly shall, and in the case of any premerger notifications and related documentation required under the HSR Act, no later than five (5) Business Days following the date hereof, make all filings and submissions and shall take all other actions necessary, proper or advisable under applicable Laws to obtain any required approval of any Governmental Entity with jurisdiction over the transactions contemplated hereby. Each Party shall furnish to the appropriate Governmental Entity all information required for any application or other filing to be made pursuant to any applicable Law in connection with the transactions contemplated hereby. Each of the Parties shall cooperate with the other in promptly filing any other necessary applications, reports or other documents with any Governmental Entity having jurisdiction with respect to this Agreement and the transactions contemplated hereby, and in seeking necessary consultation with and prompt favorable action by such Governmental Entity. Concurrently with such filings or as soon thereafter as practicable, each of the Parties shall each request early termination of any waiting period applicable to the transactions contemplated hereby under the HSR Act.
(b) Each Party shall promptly notify the other of any written notice or other communication received by such Party from any Governmental Entity in connection with the transactions contemplated hereby, and to the extent reasonably practicable, all discussions, telephone calls and meetings with a Governmental Entity regarding the transactions contemplated by this Agreement shall include Representatives of the Company and the Purchaser. No Party may extend, or take any action that would have the effect of extending, the applicable waiting period under the HSR Act without the prior written consent of each of the other Parties.
(c) If any objections are asserted by any Governmental Entity with respect to the transactions contemplated hereby, or if any Governmental Entity challenges any of the transactions contemplated hereby as violative of any applicable antitrust Law or an order is issued enjoining the transactions contemplated hereby under any applicable antitrust Law, the Purchaser shall, subject to the provisions of this Section 6.3, use its reasonable best efforts to resolve any such objections or challenges as such Governmental Entity may have to such transactions under such Law or to have the order vacated, reversed or otherwise removed in accordance with applicable legal procedures with the goal of enabling the transactions contemplated by this Agreement to be consummated by the End Date, and the Company shall cooperate with and assist the Purchaser in effectuating the foregoing; provided, however, that the Purchaser shall not take any of the foregoing actions without the consent of the Company if such actions would bind the Company, any of its Subsidiaries or the DMS Entities to take any action (including paying money or entering into any other obligation) irrespective of whether the Closing occurs. The Purchaser shall, subject to the provisions of this Section 6.3, use its reasonable best efforts to seek to lift, reverse or remove any temporary restraining order, preliminary or permanent injunction or other order or decree that would otherwise give rise to a failure of any condition to the Closing of the transactions contemplated by this Agreement.
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(d) Notwithstanding anything in this Agreement to the contrary, the Purchaser shall, to the extent necessary in order to obtain approval of any Governmental Entity or otherwise permit the transactions contemplated by this Agreement to be consummated on a timely basis, (i) cause any asset or business, or any portion of any asset or business, of the Purchaser, any of its Subsidiaries or, following the Closing, of the Company or any Subsidiary of the Company to be sold, divested or otherwise disposed of; (ii) enter into or cause any of its Subsidiaries or, concurrent with or following the Closing, the Company or any Subsidiary of the Company to enter into a voting trust agreement, proxy arrangement or other similar agreement or arrangement with respect to any asset or business or any portion of any asset or business; (iii) cause any contractual or business relationship between (A) the Purchaser or the Purchasers Subsidiaries or, following the Closing, the Company or any Subsidiary of the Company and (B) any other Person to be terminated or modified; and (iv) agree to amendments to this Agreement as may be requested by the U.S. Federal Trade Commission or the U.S. Department of Justice pursuant to the HSR Act or otherwise in order to facilitate clearance of the transactions contemplated by this Agreement under the HSR Act. In no event shall the Company, any of its Subsidiaries or any of the DMS Entities be required to take, or commit to take, any of the actions required to be taken by the Purchaser pursuant to this Section 6.3(d).
(e) Neither the Purchaser nor the Company shall, and each shall cause its Subsidiaries not to, acquire or agree to acquire, by merging with or into or consolidating with, or by purchasing a substantial portion of the assets of or equity in, or by any other manner, any business or any corporation, partnership, association or other business organization or division thereof, or otherwise acquire or agree to acquire any assets, if the entering into of a definitive agreement relating to, or the consummation of such acquisition, merger or consolidation, would reasonably be expected to: (i) impose any material delay in the obtaining of, or materially increase the risk of not obtaining, any consents of any Governmental Entity necessary to consummate the transactions contemplated by this Agreement or the expiration or termination of any applicable waiting period; (ii) materially increase the risk of any Governmental Entity seeking or entering any judgment decree or order prohibiting the consummation of the transactions contemplated by this Agreement; (iii) materially increase the risk of not being able to remove any such judgment decree or order on appeal or otherwise; or (iv) materially delay or prevent the consummation of the transactions contemplated by this Agreement.
Section 6.4 Public Announcements. Subject to applicable Law, each Party shall consult with the other Parties with respect to the timing and content of all announcements regarding this Agreement or the transactions contemplated hereby to the financial community, customers or the general public and shall use reasonable best efforts to agree upon the text of any such announcement prior to its release. The Company, the Purchaser and Merger Sub agree to, and to cause their respective Affiliates to, keep the terms of this Agreement confidential, except to the extent and to the Persons to whom disclosure is required by applicable Law, as may be required to enforce the terms of this Agreement or for purposes of compliance with financial reporting obligations; provided, that (a) the Parties may disclose such terms to their respective Representatives as necessary in connection with the ordinary conduct of their respective businesses and (b) the Parties may disclose the terms of this Agreement in order to comply with
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the covenants contained herein. The Company and the Purchaser further acknowledge and agree that KRG Capital Management, L.P. and its Affiliates and Representatives may disclose such terms and the existence of this Agreement and the transactions contemplated hereby to its limited partners or investors and prospective limited partners or investors in connection with their customary fundraising and reporting activities.
Section 6.5 Company Benefit Plans.
(a) With respect to employees of the Company and its Subsidiaries (excluding the DMS Entities) (and their dependents and beneficiaries where appropriate), solely to the extent permitted under applicable Laws, (i) the Purchaser shall continue on a plan-by-plan basis to provide coverage and make all payments (excluding any equity and equity based, change in control and transaction compensation payments and pension benefit plans subject to Title IV of ERISA) required under each Company Benefit Plan identified in Section 4.15 of the Disclosure Schedule (which, for the sake of clarity, shall not include any pension benefit plans subject to Title IV of ERISA) at least through December 31, 2017 or, with respect to employee welfare benefit plans (as defined in Section 3(1) of ERISA, the end of the applicable plan year in which Closing occurs, if sooner and (ii) the Purchaser shall as of the Closing, to the extent permitted under the terms of Purchasers Employee Benefit Plans, (A) recognize such employees employment service with the Company or its Subsidiaries (including credit for service with predecessor employers as currently recognized under the applicable Company Benefit Plans) for participation, vesting and benefit eligibility purposes (but not benefit accruals) under any Employee Benefit Plan that the Purchaser may provide to such employees (excluding, for the sake of clarity, any pension benefit plan subject to Title IV of ERISA); provided that such service crediting will not result in the duplication of benefits, (B) not require such employees, in the plan year in which the Closing occurs, to satisfy any deductible, co-payment, out of pocket maximum or similar requirement under any Employee Benefit Plan that the Purchaser may provide to such employees to the extent of amounts previously credited for such purposes under the applicable plans of the Company and its Subsidiaries, (C) not apply to such employees, in the plan year in which the Closing occurs, any waiting periods, pre-existing condition exclusions and requirements to show evidence of good health contained in any Employee Benefit Plan that the Purchaser may provide to such employees to the extent waiting periods, pre-existing conditions, exclusions and requirements were satisfied under the corresponding Company Benefit Plans and (D) in the sole discretion of the Purchaser or as required by Law, either (x) honor in full all accrued but unused vacation accrued in accordance with Company policy and recognize pre- and post-Closing service with the Company or its Subsidiaries (including credit for service with predecessor employers as currently recognized under the applicable Company Benefit Plans) for purposes of accrual of vacation following the Closing Date or (y) pay to the applicable employees the value of the benefits set forth in Section 6.5(a)(ii)(D)(x).
(b) Prior to the Closing and effective as of no later than the Closing Date, the Company shall take all actions necessary to cause it or one of its Subsidiaries to accept the transfer from the DMS Entities of the Employee Benefit Plans set forth on Section 6.5(b) of the Disclosure Schedule and all other related agreements (the Transferring
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Plans), and the Company shall assume all rights and obligations with respect to such Transferring Plans.
(c) All provisions contained in this Agreement with respect to employee benefit plans or employee compensation are included for the sole benefit of the respective Parties hereto and shall not create any right in any other Person, including any employee or former employee of the Company or any of its Subsidiaries or any participant or beneficiary in any Company Benefit Plan. Nothing contained in this Agreement shall be deemed to constitute an amendment to any Company Benefit Plan or any Employee Benefit Plan of the Purchaser.
Section 6.6 Section 280G. Prior to the Closing Date, the Company shall submit to a stockholder vote, in a manner that satisfies the stockholder approval requirements under Section 280G(b)(5)(B) of the Code and regulations promulgated thereunder (a Stockholder Vote), the right of any disqualified individual (as defined in Section 280G(c) of the Code) to receive any and all payments (or other benefits) contingent on the consummation of the transactions contemplated by this Agreement (within the meaning of Section 280G(b)(2)(A)(i) of the Code) to the extent necessary so that no payment received by, or benefit provided to, such disqualified individual would be a parachute payment under Section 280G(b) of the Code and no individual would be entitled to receive any payment in the nature of a 280G gross up. The Company shall: (a) at least three Business Days prior to providing: (i) the applicable disqualified individuals with any required waivers, consents or agreements; and (ii) the applicable stockholders with any materials necessary to comply with the Stockholder Vote, provide a draft of the applicable materials to Purchaser and incorporate into such materials any reasonable comments that are timely provided by Purchaser; and (b) obtain any required waivers, consents or agreements from each disqualified individual at least one day prior to conducting the Stockholder Vote. Prior to the Closing, the Company shall provide Purchaser and its counsel with copies of all documents executed by the stockholders and disqualified individuals in connection with the Stockholder Vote.
Section 6.7 Directors and Officers Indemnification.
(a) From and after the Closing Date, the Purchaser shall cause the Company to continue to indemnify, defend and hold harmless, to the fullest extent permitted under applicable Law, the individuals who on or prior to the Closing Date were directors or officers of the Company or any of its Subsidiaries against any costs or expenses (including reasonable attorneys fees), judgments, fines, losses, claims, damages or liabilities incurred in connection with any claim, action, suit, proceeding or investigation with respect to any acts or omissions by them in their capacities as such or taken at the request of the Company or any of its Subsidiaries at any time on or prior to the Closing Date. The Purchaser agrees that all rights of such Persons to indemnification and exculpation from liabilities for acts or omissions occurring at or prior to the Closing Date as provided in the respective certificate of incorporation or bylaws or comparable organizational documents of the Company or any of its Subsidiaries as now in effect, and any indemnification agreements or arrangements of the Company or any of its Subsidiaries shall survive the Closing Date and shall continue in full force and effect in accordance with their terms. Such rights shall not be amended, or otherwise modified in
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any manner that would adversely affect the rights of such indemnitees unless such modification is required by applicable Law. In addition, the Purchaser shall cause the Company to pay any expenses of any such indemnitee under this Section 6.7 as incurred to the fullest extent permitted under applicable Law, provided that the person to whom expenses are advanced provides an undertaking to repay such advances to the extent required by applicable Law.
(b) The Purchaser agrees that (i) the certificate of incorporation and the bylaws or comparable organizational documents of the Company and its Subsidiaries after the Closing shall contain provisions with respect to indemnification and exculpation from liability that are at least as favorable to the beneficiaries of such provisions as those provisions that are set forth in the certificate of incorporation and bylaws or comparable organizational documents of the Company and its Subsidiaries, respectively, on the date of this Agreement, which provisions shall not be amended, repealed or otherwise modified for a period of six (6) years following the Closing Date in any manner that would adversely affect the rights thereunder of Persons who at or prior to the Closing were directors, officers, employees or agents of the Company or any of its Subsidiaries, unless such modification is required by applicable Law and (ii) all rights to indemnification as provided in any indemnification agreements with any current or former directors, officers and employees of the Company or any of its Subsidiaries set forth on Section 6.7(b) of the Disclosure Schedule as in effect as of the date hereof with respect to matters occurring at or prior to the Closing shall survive the Closing.
(c) The Parties agree that the Purchaser (or a third party at the direction of the Purchaser), at the Purchasers sole expense, will purchase prior to the Closing tail coverage with respect to acts or omissions occurring prior to the Closing Date for a period of six (6) years following the Closing Date under the directors and officers liability insurance policy of the Company as it relates to the Company, its Subsidiaries and the DMS Entities, as in effect on the Closing Date. The aggregate amount necessary to purchase such tail coverage shall be referred to as the D&O Tail Premium.
(d) In the event the Purchaser or the Company or any of their respective Subsidiaries, successors or assigns (i) consolidates with or merges into any other Person and is not the continuing or surviving corporation or entity of such consolidation or merger or (ii) transfers all or substantially all of its properties and assets to any Person, the Purchaser shall use its reasonable best efforts to ensure that proper provisions shall be made so that the successors and assigns of the Purchaser, the Company or their respective Subsidiaries (as applicable) assume the obligations set forth in this Section 6.7.
(e) This Section 6.7, which shall survive the Closing and shall continue for the periods specified herein, is intended to benefit any Person or entity referenced in this Section 6.7 or indemnified hereunder, each of whom may enforce the provisions of this Section 6.7 (whether or not parties to this Agreement). The obligations of the Purchaser and the Surviving Corporation under this Section 6.7 shall not be terminated or modified in such a manner as to adversely affect any indemnitee to whom this Section 6.7 applies without the express written consent of such affected indemnitee (it being expressly
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agreed that the indemnities to whom this Section 6.7 applies shall be third party beneficiaries of this Section 6.7).
Section 6.8 Company Stockholder Approval; Appraisal Rights. Immediately following the execution of this Agreement, the Company shall, upon consideration of the Company Board Recommendation, (a) submit this Agreement to its Stockholders entitled to vote hereon and solicit and use its reasonable best efforts to obtain, immediately following execution of this Agreement, the Company Stockholder Approval and (b) provide the Purchaser a certificate of the Secretary of the Company certifying the Company Stockholder Approval and attaching the applicable written consents (the Stockholder Approval Certificate). The materials submitted to such Stockholders shall include the Company Board Recommendation. Upon obtaining the Company Stockholder Approval, the Company shall promptly send an information statement to all Stockholders entitled to receive notice under Sections 228(e) and 262 of the DGCL that action to approve the Merger and the DMS Transaction was taken by less than all of Companys stockholders and that appraisal rights may be available with respect to their shares of Company Stock, which notice shall include a copy of Section 262 of the DGCL as required by such section.
Section 6.9 Tax Matters.
(a) Tax Returns. The Company shall, at the Companys expense, prepare or cause to be prepared and timely file or cause to be timely filed all Tax Returns required to be filed by the Company or any Subsidiary (including such Tax Returns filed pursuant to any valid extension of time to file) prior to the Closing Date (Pre-Closing Period Tax Returns), the Company shall timely pay or cause to be timely paid all Taxes with respect to such Pre-Closing Period Tax Returns, and all such Pre-Closing Period Tax Returns shall be prepared in accordance with past practice unless otherwise required by applicable Tax Law. The Company shall provide all Pre-Closing Period Tax Returns to the Purchaser for the Purchasers review and comment at least twenty (20) days before the due date (including any valid extension of time to file) for any such Pre-Closing Period Tax Returns and shall reflect on such Pre-Closing Period Tax Returns any reasonable comments provided by the Purchaser prior to filing such Pre-Closing Period Tax Returns. The Purchaser shall cause the Surviving Corporation, at the expense of the Stockholder Representative with respect to Pre-Closing Periods and at the expense of the Surviving Corporation with respect to Straddle Periods, to prepare in good faith and timely file, or cause to be prepared and timely filed all other Tax Returns for Pre-Closing Periods and Straddle Periods for the Company and its Subsidiaries and shall pay all Taxes due with respect to each such Tax Return. With respect to Tax Returns filed with respect to the Section 338(h)(10) allocation agreed to with respect to the DMS Transaction, such Tax Returns shall be filed consistent with the allocation of the purchase price finally agreed to by the parties with respect to the DMS Transaction, it being understood by the Company, on behalf of itself and VMAC, that the Purchaser shall have the right to review and comment on such allocation and that VMAC will reflect any reasonable comments provided by Purchaser in the final allocation agreed to by VMAC in the DMS Transaction or submitted to the arbitrator of such allocation, as the case may be. Such Tax Returns shall be prepared in accordance with past practice unless otherwise required by applicable Tax Law.
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(b) Straddle Period. In the case of any Straddle Period, for purposes of determining the amount of any Tax liabilities of the Company and its Subsidiaries in computing the Closing Date Net Working Capital, the amount of such Taxes attributable to the portion of the Straddle Period shall be (i) in the case of any Pre-Closing Period Taxes other than sales or use taxes, value-added taxes, employment taxes, withholding taxes, and any Tax based on or measured by income, receipts or profits earned during a Straddle Period, be deemed to be the amount of such Tax for the entire taxable period multiplied by a fraction, the numerator of which is the number of days in the pre-Closing Straddle Period and the denominator of which is the number of days in the Straddle Period, and (ii) in the case of any sales or use taxes, value-added taxes, employment taxes, withholding taxes, and any Tax based on or measured by income, receipts or profits earned during a Straddle Period, be deemed equal to the amount that would be payable if the Straddle Period ended on and included the Closing Date. In the case of a Tax that is (x) paid for the privilege of doing business during a period (a Privilege Period) and (y) computed based on business activity occurring during an accounting period ending prior to such Privilege Period, any reference to a Tax period, a tax period, or a taxable period shall mean such accounting period and not such Privilege Period.
(c) Amendments, Modifications, etc. After the Closing Date, the Purchaser and its Affiliates, shall not (and shall have no right to), without the written consent of the Stockholder Representative, amend, modify or otherwise change any Tax Return of the Company or its Subsidiaries for any Pre-Closing Period or Straddle Period if such amendment, modification or change would reduce the amount of any Tax refund or credit that would otherwise be owed to the Holders pursuant to Section 6.9(e) or would reduce a payment that would otherwise be owed to the Holders pursuant to Section 6.9(k), unless such amendment, modification or change is required by applicable Tax Law and, in the case of any such amendment, modification or change, the Purchaser shall provide notice thereof to the Stockholder Representative no later than fifteen (15) days prior to such amendment, modification or change.
(d) Cooperation. The Purchaser and the Surviving Corporation, on the one hand, and the Stockholder Representative, on the other hand, shall cooperate, as and to the extent reasonably requested by the other Party, in connection with the preparation and filing of Tax Returns pursuant to this Section 6.9 and any Tax inquiry, audit or administrative or judicial proceeding or of any demand or claim on the Surviving Corporation or any of its Subsidiaries (Tax Proceeding). Such cooperation shall include signing any Tax Returns, amended Tax Returns, claims or other documents necessary to settle any Tax Proceeding, the retention and (upon the other Partys request) the provision of records and information which are reasonably relevant to any such Tax Proceeding or other proceeding and making employees available on a mutually convenient basis during normal business hours to provide additional information and explanation of any material provided hereby.
(e) Refunds. Except to the extent included as an asset in the calculation of Closing Date Net Working Capital or attributable to any Tax attribute generated after the Closing Date, any Tax refund or credit (including any interest paid or credited by any
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Taxing Authority with respect thereto) of Taxes for any Pre-Closing Period paid by the Company or its Subsidiaries prior to Closing or that were included as a current liability in determining Closing Date Net Working Capital shall be solely the property of the Holders, but shall be reduced by the Purchaser for any Taxes or other reasonable costs and expenses incurred by the Purchaser, the Company or its Subsidiaries or any of their Affiliates in connection with claiming or receiving such refund or credit. All other Tax refunds or credits of the Company or any of its Subsidiaries for any Pre-Closing Period shall be solely the property of the Purchaser. The Purchaser shall, if the Stockholder Representative so requests, cause the Company to file for, and use its reasonable best efforts to obtain and expedite the receipt of, any Tax refund or credit to which the Holders are entitled under this Section 6.9(e), and the Purchaser shall permit the Stockholder Representative to participate in the prosecution of any such refund claim. If received by the Purchaser or the Company, any amounts payable to the Holders pursuant to this Section 6.9(e) shall be paid, within ten (10) days after receipt or entitlement thereto, to the Stockholder Representative, for the benefit of the Holders in accordance with their Pro Rata Percentages (or, in the case of the Option Holders, paid to the Company, for the benefit of the Option Holders in accordance with their Pro Rata Percentages). For purposes of this Section 6.9(e), any Tax refund or credit (including any interest paid or credited by any Taxing Authority with respect thereto) for a Straddle Period shall be allocated between the Pre-Closing Period and the Post-Closing Period in accordance with the allocation principles set forth in Section 6.9(b).
(f) No Section 338 Election. No election under Section 338(g) of the Code, or any similar provision of state or local Law, may be made with respect to the transactions contemplated by this Agreement.
(g) Documentation. The Purchaser and the Surviving Corporation, on the one hand, and the Stockholder Representative, on the other hand, further agree, upon request from the other Party, to use their commercially reasonable efforts to obtain any certificate or other document from any Governmental Entity or any other Person as may be necessary to mitigate, reduce or eliminate any Tax that could be imposed (including, but not limited to, with respect to the transactions contemplated hereby).
(h) Transfer Taxes. Any sales, use, real estate transfer, stock transfer or similar transfer Tax (Transfer Taxes) payable in connection with the transactions contemplated by this Agreement shall be borne by the Purchaser; provided, that, for the avoidance of doubt, the Purchaser will not bear any Transfer Taxes payable in connection with the DMS Transaction.
(i) Certain Conventions for Determining Taxes. The Parties agree for purposes of determining the Holders obligation for Taxes (other than Transfer Taxes) relating to the Pre-Closing Period and, as applicable, for purposes of preparing Tax Returns of the Surviving Corporation and its Subsidiaries for Pre-Closing Periods, to use the following conventions and procedures:
(i) All Transaction Tax Deductions accrued on or before the Closing Date shall be treated as being incurred in a Pre-Closing Period.
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(ii) All elections and decisions with respect to whether to carryback or carryforward a net operating loss or other Tax attribute or credit incurred in any Pre-Closing Period shall be made such that the net operating loss or other Tax attribute or credit is first carried back to the maximum extent permitted under applicable Law prior to being carried forward to a Post-Closing Period.
(iii) Any gains, income, deductions, losses or other items resulting from any transactions outside of the ordinary course of business occurring on the Closing Date, but after the Closing, and not contemplated by this Agreement shall not be treated as occurring on the Closing Date.
(j) Characterization of Certain Payments. For all relevant Tax purposes, the Parties agree to treat the Working Capital Escrow Fund as an asset of the Purchaser and all interest and other earnings on the Working Capital Escrow Fund as earnings of the Purchaser (it being understood that this tax characterization shall not affect which Person is entitled to such earnings). Unless otherwise required by a determination of a Governmental Entity that is final, no Party hereto shall file a Tax Return, or take position during the course of any audit or other proceeding, that is inconsistent with such agreement.
(k) Tax Benefits. To the extent that the Purchaser, the Surviving Corporation or any of their Subsidiaries (i) files a Tax Return (which, for this purpose, shall not include any payment of estimated Taxes) on which a Tax Benefit is reflected or (ii) receives a Tax refund or credit (including any interest paid or credited by any Taxing Authority with respect thereto) of Taxes paid for any Pre-Closing Period which Tax refund or credit is attributable to the Transaction Tax Deductions (including as a result of utilizing any net operating loss or other Tax attribute that was created as a result of the Transaction Tax Deductions), or any net operating loss otherwise existing as of the Effective Time as reflected on the Tax Returns prepared pursuant to Section 6.9(a), the Purchaser shall, within ten (10) days of filing such Tax Return, in the case of any Tax Benefit, or receiving such Tax refund or utilizing such Tax credit, in the case of any Tax refund or credit, pay to the Stockholder Representative, for the benefit of the Holders in accordance with their Pro Rata Percentages, the full amount of such Tax Benefit or the amount of such Tax refund or credit reduced by any Taxes or other reasonable costs or expenses incurred by the Purchaser or any of its Affiliates in connection with claiming or receiving such Tax refund or credit, in either case, that is in excess of the amount, if any, of such Tax Benefit or Tax refund or credit that was included as an asset for purposes of the Closing Date Net Working Capital, as finally determined; provided, however, that the Purchaser shall have the right to offset any payment due to the Stockholder Representative pursuant to this Section 6.9(k) by any amounts owed by the Stockholder Representative to the Purchaser with respect to Taxes. The obligations of the Holders, Purchaser, the Surviving Corporation and its Subsidiaries under this Section 6.9(k) shall survive the Closing indefinitely.
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Section 6.10 Notification of Events; Supplemental Disclosure.
(a) During the period from the date hereof to the Closing Date or the earlier termination of this Agreement, the Purchaser shall promptly notify the Company in writing if the Purchaser becomes aware of (i) the occurrence or non-occurrence of any event or the existence of any fact or condition that would cause or constitute a breach of any of its or Merger Subs representations or warranties had any such representation or warranty been made as of the time of the Purchasers discovery of such event, fact or condition and (ii) any material failure on its or Merger Subs part to comply with or satisfy any covenant, condition or agreement to be complied with or satisfied by it or Merger Sub hereunder.
(b) During the period prior to the Closing Date or the earlier termination of this Agreement, the Company shall promptly notify the Purchaser in writing if the Company becomes aware of (i) the occurrence or non-occurrence of any event or the existence of any fact or condition that would cause or constitute a breach of any of the Companys representations or warranties contained herein had such representation or warranty been made as of the time of the discovery of such event, fact or condition and (ii) any material failure on the part of the Company to comply with or satisfy any covenant, condition or agreement to be complied with or satisfied by it hereunder.
Section 6.11 Retention of Books and Records. The Purchaser shall cause the Company and its Subsidiaries to retain all books, ledgers, files, reports, plans, operating records and any other material documents pertaining to the Company and its Subsidiaries in existence at the Closing that are required to be retained under current retention policies for a period three (3) years from the Closing Date (or, with respect to Tax Returns, seven (7) years from the Closing Date), and to make the same available after the Closing for inspection and copying by the Stockholder Representative or its Representatives at the Stockholder Representatives expense, during regular business hours and upon reasonable request and upon reasonable advance notice.
Section 6.12 Contact with Customers and Suppliers. Until the Closing Date, the Purchaser shall not, and shall cause its Representatives not to, contact or communicate with the employees, customers, suppliers, distributors or licensors of the Company, the Companys Subsidiaries or the DMS Entities, or any other Persons having a business relationship with the Company, the Companys Subsidiaries or the DMS Entities (other than communication with the DMS Buyer to which the Company is party) concerning the transactions contemplated hereby or any of the foregoing relationships with the Company or its Subsidiaries without the prior written consent of the Stockholder Representative (which consent will not be unreasonably withheld, conditioned or delayed).
Section 6.13 Cooperation on Financing.
(a) Although the parties acknowledge and agree that obtaining financing is not a condition to Closing, the Company shall, and shall cause its Affiliates and their respective Representatives to, use reasonable best efforts to reasonably cooperate with the Purchaser and its Affiliates and their respective Representatives in connection with any financing that the Purchaser and/or its Affiliates may obtain in connection with the transaction contemplated hereunder, including (i) participating in a reasonable number (at
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reasonable times and at reasonable frequency) of meetings (including customary one-on-one meetings with the parties acting as lead arrangers or agents for, and prospective lenders and purchasers of, any financing and senior management, representatives or advisors, with appropriate seniority and expertise, of the Company and/or its Affiliates), presentations, road shows and due diligence and drafting sessions with providers of the financing and rating agencies, (ii) assisting in the preparation of reasonably necessary business projections, materials for rating agency presentations, offering memoranda and other written materials, including customary representation letters and the provision of financial statements in connection therewith, (iii) providing reasonably promptly to the Purchaser and any lenders such financial and other information regarding the Company and its Subsidiaries that is readily available to or within the Company and/or its Subsidiaries possession, in each case, as is reasonably requested in connection with any such financing, (iv) executing and/or delivering reasonable and customary certificates (including solvency certificates), insurance documents/endorsements and other documentation reasonably required by the lenders and the definitive documentation related to any such financing, subject to the occurrence of the Closing, (v) delivering appropriate notices for the repayment of all indebtedness to be repaid at the Closing and payoff letters and lien releases in connection with such repayment, (vi) assisting with the procurement of customary pledge and security documents, including delivering possessory collateral (such as certificated equity and promissory notes) to the lenders, subject to the occurrence of the Closing, (vii) assisting the Purchaser to obtain waivers, consents, estoppels and approvals from other parties to material leases, encumbrances and contracts relating to the Company and its Subsidiaries and to arrange discussions among the Company, the lenders, and their respective Representatives with other parties to material leases, encumbrances and contracts as of the Closing, (viii) taking all actions reasonably necessary to (A) permit the Lenders to evaluate the Companys and its Subsidiaries current assets, cash management and accounting systems, policies and procedures relating thereto for the purposes of establishing collateral arrangements as of the Closing and to assist with other collateral audits and due diligence examinations and (B) establish bank and other accounts and blocked account agreements and lock box arrangements to the extent necessary in connection with any such financing, and (ix) providing all documentation and other information as is reasonably required by applicable know your customer and anti-money laundering rules and regulations including the USA PATRIOT Act to the extent requested at least five (5) Business Days prior to the anticipated Closing Date.
(b) Notwithstanding anything to the contrary in this Agreement, neither the Company, or any of its Affiliates or any of their respective Representatives shall be required to (i) pay any commitment or other similar fee, (ii) approve any document or other matter related to the financing or incur any liability of any kind prior to the Closing, (iii) enter into any agreement or commitment in connection with the financing which would be effective prior to the Closing or provide any certification or opinion which would be effective prior to the Closing (other than customary representation letters), (iv) provide any certificate, comfort letter or opinion of any of its Representatives which would be effective prior to the Closing (other than customary representation letters), (v) provide access to or disclose any information to the Purchaser or its Representatives to the extent such disclosure would jeopardize the attorney-client privilege, attorney work
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product protections or similar protections or violate any applicable Law, and (vii) take any action that would (A) cause any representation or warranty in this Agreement or any Company Ancillary Document to be breached, (B) conflict with their organizational documents (as in effect on the date hereof) or any Law, (C) result in the breach of, or a default under, any material contract, (D) materially interfere with the day-to-day operations of the AT Business of the Company or (E) authorize any corporate action.
(c) The Purchaser shall promptly, upon request by the Company, reimburse the Company for any reasonable and documented out-of-pocket costs and expenses (including reasonable and documented attorneys fees and reasonable and documented independent accountants fees) incurred by the Company or any of its Affiliates in connection with the cooperation contemplated by this Section 6.13.
Section 6.14 Exclusivity. For the period commencing on the date hereof and ending on the Closing Date, the Company will not, and will cause its Affiliates and their respective Representatives not to, directly or indirectly, (i) solicit, initiate or encourage the submission of any proposal or offer from any Person relating to the acquisition of all or a material portion of the capital stock or assets of the Company or any of its Subsidiaries (including any acquisition structured as a merger, consolidation or share exchange) or (ii) enter into, maintain or continue discussions or negotiations regarding, or furnish or disclose to any Person any information in connection with any acquisition of all or a material portion of the capital stock or assets of the Company or any of its Subsidiaries (including any acquisition structured as a merger, consolidation or share exchange), and the Company shall not, and will cause its Affiliates not to, enter into any letter of intent or purchase agreement, merger agreement or other similar agreement with any Person other than the Purchaser and Merger Sub with respect to an acquisition of all or a material portion of the capital stock or assets of the Company or any of its Subsidiaries (including any acquisition structured as a merger, consolidation or share exchange).
Section 6.15 DMS Transaction.
(a) The Company shall use reasonable best efforts to cause Vention Medical Acquisition Co., a Delaware corporation and a wholly-owned Subsidiary of the Company (the DMS Seller), to assign, dividend or otherwise transfer all of the outstanding capital stock of Vention Medical, Inc., a New Jersey corporation and a wholly-owned subsidiary of the Company (VMI), to the DMS Buyer substantially on the terms and subject to the conditions of the DMS Purchase Agreement (such transfer, the DMS Transaction). The Company will not, and will cause its Affiliates not to, (i) permit any amendment to, or waiver of the terms of, the DMS Purchase Agreement following the execution thereof, and (ii) will not negotiate with respect to any Allocation Disagreement Notice (as defined in the DMS Purchase Agreement) pursuant to Section 7.7(j)(ii) of the DMS Purchase Agreement, in each case, except with Purchasers prior written consent; provided, however, that such waivers shall be permitted without Purchasers prior written consent only to the extent they do not impact the financial condition or tax position or create liability for the Company and its Subsidiaries or impact the timing of the Closing or whether the Closing occurs.
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(b) Notwithstanding anything in this Agreement to the contrary, under no circumstances shall the DMS Entities or the business conducted by them include any of the stock of Vention Medical Design and Development, Inc., a Delaware corporation and wholly-owned direct subsidiary of VMI (VMDD), or any of its direct or indirect subsidiaries. Prior to the consummation of the DMS Transaction, VMI shall dividend or otherwise transfer the shares of VMDD to the Company or any of its Subsidiaries, such that VMDD shall not be a direct or indirect subsidiary of VMI at the time of the closing of the DMS Transaction.
(c) If the DMS Entities are transferred to a third party buyer, then the Parties shall take any and all actions necessary to effect an election under Section 338(h)(10) of the Code and any corresponding election under state, local, and foreign Tax Law with respect to the purchase and sale of the DMS Entities, including the preparation and filing of IRS Forms 8023 and 8883, required schedules thereto, and any similar state, local or foreign Tax Returns. The Company shall report the DMS Transaction consistent with the treatment thereof as a qualified stock purchase and the election under Section 338(h)(10) of the Code and no Party shall take any position inconsistent therewith in any Tax Return, any proceeding before any Taxing Authority or otherwise, unless otherwise required by a change in applicable Tax Law occurring after the date hereof, a closing agreement with an applicable Taxing Authority or a final non-appealable judgment of a court of competent jurisdiction.
(d) Prior to the consummation of the DMS Transaction, the Seller shall cause the Company and its Subsidiaries to extinguish the Intercompany Note by causing the lenders thereunder to contribute any indebtedness thereunder to the capital of the borrowers thereunder and, promptly thereafter, provide the documentation thereof to the Purchaser.
Section 6.16 Transition Services Agreement. At or prior to the consummation of the DMS Transaction, the Company or one of its Subsidiaries shall enter into a transition services agreement with VMI substantially in the form attached as Annex B (the Transition Services Agreement) pursuant to which (A) the Company and its Subsidiaries shall continue to provide to the DMS Entities and (B) the DMS Entities shall continue to provide to the Company and its Subsidiaries certain ancillary or corporate shared services that the (x) Company or its Subsidiaries currently provide to the DMS Entities or (y) the DMS Entities currently provide to the Company or its Subsidiaries, as applicable, in each case to the extent reasonably necessary to timely facilitate the DMS Transaction and the separate operation of the respective businesses of each of (i) the AT Business and (ii) the DMS Entities following the closing of the DMS Transaction. For the avoidance of doubt, the Company will not, and will cause the Subsidiary party thereto not to, permit any modification to, amendment of, or waiver of, the terms of the Transition Services Agreement or schedules or other attachments thereto, whether before or after the execution thereof, except with Purchasers prior written consent, except that such waivers shall be permitted without Purchasers prior written consent only to the extent they do not impact the financial condition or tax position or create liability for the Company and its Subsidiaries or impact the timing of the Closing or whether the Closing occurs.
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Section 6.17 Salary Continuation, Separation and Release Agreements.
(a) Prior to the Closing, the Company shall use reasonable best efforts to enter into an agreement with each employee set forth on Exhibit 1.1(b) that provides for the terms of such employees separation from the Company, the release by such employee of claims against the Company upon termination and the terms of severance payments (if any) to such employees.
(b) Prior to the Closing, the Company shall use reasonable best efforts to enter into an agreement with each employee set forth on Exhibit 1.1(c) in substantially the forms set forth at Exhibit 6.17, subject to modifications that are reasonably satisfactory to the Purchaser.
Section 6.18 Consents and Releases. Prior to Closing, the Company shall use reasonable best efforts to (a) obtain the consents listed on Section 6.18 of the Disclosure Schedule, (b) deliver, or cause to be delivered, to the Purchaser, estoppel certificates relating to the Leased Real Property for which landlord consent is required and (c) deliver, or cause to be delivered, to the Purchaser, releases duly executed by each Option Holder, in a form reasonably satisfactory to Purchaser and the Company.
Section 6.19 Certain Filings. Prior to the Closing, the Company (or its Affiliate (including any DMS Entity), as applicable) shall take the actions referenced on Section 6.19 of the Disclosure Schedules.
Section 6.20 Post-Closing Option Consideration. Notwithstanding anything to the contrary set forth in this Agreement, any Post-Closing Option Consideration that is delivered to and then becomes payable by the Surviving Corporation or the Purchaser shall be paid by the Company directly to the Option Holders (in amounts set forth by the Stockholder Representative in accordance with their Pro Rata Percentages). From and after the Effective Time, the Company shall use commercially reasonable efforts and reasonably cooperate with the Stockholder Representative to determine and facilitate the transmission of all amounts payable to Option Holders in respect of (1) Post-Closing Option Consideration and (2) any escrow funds released pursuant to the terms of the DMS Purchase Agreement.
ARTICLE VII
CONDITIONS TO CLOSING
Section 7.1 Conditions to Each Partys Obligations. The respective obligations of each Party to effect the transactions contemplated hereby shall be subject to the following conditions, any of which, if not fulfilled, may, with respect to such Party only, be waived by that Party:
(a) Company Stockholder Approval. The Company Stockholder Approval shall have been obtained.
(b) DMS Transaction. The DMS Transaction shall have been consummated and the Transition Services Agreement shall have been duly executed by the parties thereto.
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(c) HSR Act. All required filings under the HSR Act shall have been completed with respect to this Agreement and any other document related to the Merger, and the waiting period applicable to the consummation of the Merger under the HSR Act will have expired or terminated.
(d) Injunction. There shall be no Law enacted, adopted, promulgated or enforced, or any ruling, judgment, injunction, order or decree of any Governmental Entity having competent jurisdiction in effect that enjoins, prohibits or otherwise makes illegal the consummation of the Merger; provided, however, that the Parties shall have used reasonable best efforts to resist, resolve or lift, as applicable, any such Law, ruling, judgment, injunction, order or decree.
Section 7.2 Conditions to Obligations of the Purchaser and Merger Sub. The obligations of the Purchaser and Merger Sub to consummate the transactions contemplated hereby shall be subject to the fulfillment at or prior to the Closing of each of the following additional conditions, any of which, if not fulfilled, may be waived by the Purchaser:
(a) Representations and Warranties. (i) Except for the representations and warranties in Sections 4.1 (Organization), 4.2 (Authorization), 4.3(a) (Capital Stock; Indebtedness), 4.7(b) (Title to Assets; Related Matters) and 4.22 (Brokers, Finders and Investment Bankers), the representations and warranties of the Company contained in ARTICLE IV of this Agreement shall be true and correct in all respects as of the date of this Agreement and as of the Closing Date as if made on and as of the Closing Date (except for those representations and warranties that are made only as of a specific date, which representations and warranties shall have been true and correct as of such specified date); provided, however, that for purposes of determining the satisfaction of this condition, no effect shall be given to any exception in such representations and warranties relating to materiality, Material Adverse Effect or words of similar import, and instead, for purposes of this condition, such representations and warranties shall be deemed to be true and correct in all respects unless the failure or failures of such representations and warranties to be so true and correct, individually or in the aggregate, has had or is reasonably expected to result in a Material Adverse Effect; (ii) the representations and warranties set forth in the first sentence of 4.3(a) (Capital Stock; Indebtedness), and Section 4.22 (Brokers, Finders and Investment Bankers) shall be true and correct in all respects as of the date of this Agreement and as of the Closing Date as if made on and as of the Closing Date (except for those representations and warranties that are made only as of a specific date, which representations and warranties shall have been true and correct as of such specified date) except for de minimis inaccuracies; and (iii) the representations and warranties in Section 4.1 (Organization), Section 4.2 (Authorization), Section 4.3(a) (other than the first sentence of Section 4.3(a)) and Section 4.7(b) (Title to Assets; Related Matters) shall be true and correct in all material respects as of the date of this Agreement and as of the Closing Date as if made on and as of the Closing Date (except for those representations and warranties that are made only as of a specific date, which representations and warranties shall have been true and correct as of such specified date).
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(b) Performance of Obligations of the Company. The Company shall have performed in all material respects all covenants and agreements required to be performed by it hereunder prior to the Closing.
(c) No Material Adverse Effect. Since the date of this Agreement, no effect, event, development or change has occurred that has had or would reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect.
(d) Closing Certificate. The Company shall have delivered, or caused to be delivered, to the Purchaser a certificate, dated as of the Closing Date, executed by the Company as to compliance with the conditions set forth in Section 7.2(a), Section 7.2(b), and Section 7.2(c) of this Agreement.
(e) Closing Date Indebtedness; Release of Liens. The Company shall have delivered to the Purchaser payoff letters (Payoff Letters) from each lender or holder (or the agent therefor) of any Closing Date Indebtedness with respect to the Credit Agreement evidencing the aggregate amount of such indebtedness outstanding as of the Closing Date (including any interest accrued thereon and any prepayment or similar penalties and expenses associated with the prepayment of such indebtedness on the Closing Date) and a customary statement that, if such aggregate amount is paid to such lender on the Closing Date, such indebtedness shall be repaid in full and that all Liens securing such Closing Date Indebtedness may thereafter be released.
(f) Ancillary Documents. The Company shall have delivered, or caused to be delivered, to the Purchaser the documents listed in Section 8.2 hereof.
(g) 280G Stockholder Vote. Purchaser shall have received copies of all documents executed by the stockholders and disqualified individuals in connection with the Stockholder Vote required by Section 280G of the Code and the regulations promulgated thereunder as required pursuant to Section 6.6, and in the absence of stockholder approval, none of the payments or other benefits subject to such Stockholder Vote (including any gross-up payments related thereto) shall be paid or provided.
Section 7.3 Conditions to Obligations of the Company. The obligations of the Company to consummate the transactions contemplated hereby shall be subject to the fulfillment at or prior to the Closing of each of the following additional conditions, any of which, if not fulfilled, may be waived by the Company:
(a) Representations and Warranties. (i) Except for the representations and warranties in Sections 5.1 (Organization) and 5.2 (Authorization), the representations and warranties of the Purchaser and Merger Sub contained in ARTICLE V of this Agreement shall be true and correct in all respects, in each case, as of the date of this Agreement and as of the Closing Date as if made on and as of the Closing Date (except for those representations and warranties that are made only as of a specific date, which representations and warranties shall have been true and correct as of such specified date); provided, however, that for purposes of determining the satisfaction of this condition, no effect shall be given to any exception in such representations and warranties relating to
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materiality, Material Adverse Effect or words of similar import, and instead, for purposes of this condition, such representations and warranties shall be deemed to be true and correct in all respects unless the failure or failures of such representations and warranties to be so true and correct, individually or in the aggregate, has had a material adverse effect on the ability of the Purchaser or Merger Sub to consummate the Merger or the other transactions contemplated hereby; and (ii) the representations and warranties in Section 5.1 (Organization) and Section 5.2 (Authorization) shall be true and correct in all material respects as of the date of this Agreement and as of the Closing Date as if made on and as of the Closing Date (except for those representations and warranties that are made only as of a specific date, which representations and warranties shall have been true and correct as of such specified date).
(b) Performance of Obligations by the Purchaser and Merger Sub. The Purchaser and Merger Sub shall have performed in all material respects all covenants and agreements required to be performed by them hereunder prior to the Closing.
(c) Closing Certificate. The Purchaser shall have delivered, or caused to be delivered, to the Company a certificate, dated as of the Closing Date, of any authorized officer of the Purchaser and Merger Sub as to compliance with the conditions set forth in Section 7.3(a) and Section 7.3(b) of this Agreement.
(d) Ancillary Documents. The Purchaser shall have delivered, or caused to be delivered, to the Company the documents listed in Section 8.3 hereof.
(e) Payments. All payments required to be made by the Purchaser as of the Closing Date hereunder shall have been initiated by the Purchaser pursuant to the terms of this Agreement.
Section 7.4 Frustration of Closing Conditions. None of the Company, Merger Sub or the Purchaser may rely, either as a basis for not consummating the Merger or for terminating this Agreement and abandoning the Merger, on the failure of any condition set forth in Section 7.1, Section 7.2 or Section 7.3, as the case may be, to be satisfied if such failure was caused by such Partys breach of any provision of this Agreement or failure to use reasonable best efforts to consummate the Merger and the other transactions contemplated hereby.
ARTICLE VIII
CLOSING
Section 8.1 Closing. Unless this Agreement shall have been terminated in accordance with Section 9.1, the Closing shall occur on the third (3rd) Business Day, after all of the conditions set forth in ARTICLE VII (other than conditions which by their terms are required to be satisfied or waived at Closing) shall have been satisfied or waived by the Party entitled to the benefit of the same, or at such other time and on a date as agreed to by the Parties (such date, the Closing Date). The Closing shall take place at the offices of Hogan Lovells US LLP located at 1601 Wewatta Street, Suite 900, Denver, Colorado 80202 or at such other place as the Parties may agree.
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Section 8.2 Company Closing Deliveries. At the Closing, the Company shall deliver, or cause to be delivered, to the Purchaser the following:
(a) the certificate required by Section 7.2(d) hereof;
(b) the Payoff Letters;
(c) the Certificate of Merger, duly executed by the Company (if required);
(d) the Escrow Agreement, duly executed by the Stockholder Representative and the Escrow Agent;
(e) the Paying Agent Agreement, duly executed by the Stockholder Representative;
(f) a certificate duly completed and executed, dated as of the Closing Date and prepared in accordance with the requirements of Treasury Regulations Sections 1.897-2(h) and 1.1445-2(c)(3) and in the form and substance reasonably satisfactory to the Purchaser, sufficient to establish that an interest in the Company has not and does not constitute a U.S. real property interest for purposes of Sections 897 and 1445 of the Code, and a notice to the IRS in accordance with the provisions of Treasury Regulations Section 1.897-2(h)(2), duly executed and completed;
(g) the Stockholder Approval Certificate;
(h) a non-solicitation agreement in substantially the form attached as Exhibit 8.2(h), duly executed by the applicable principals of the majority Stockholder;
(i) a release in substantially the form attached as Exhibit 8.2(i), duly executed by the applicable Stockholder; and
(j) a CD-ROM containing a true and complete copy of the data room made available to the Purchaser.
Section 8.3 Purchaser Closing Deliveries. At the Closing, the Purchaser and Merger Sub shall deliver, or cause to be delivered, to the Company, the Escrow Agent, the Paying Agent or the Stockholder Representative, as applicable, the following:
(a) the portion of the Merger Consideration to be paid at Closing pursuant to Section 3.3 hereof paid and delivered in accordance with such Section;
(b) the payments to be paid at Closing pursuant to Section 3.4 and Section 3.5 hereof paid and delivered in accordance with such Sections;
(c) the certificate required by Section 7.3(c) hereof;
(d) the Certificate of Merger, duly executed by Merger Sub;
(e) the Escrow Agreement, duly executed by the Purchaser; and
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(f) the Paying Agent Agreement, duly executed by the Surviving Corporation and the Paying Agent.
ARTICLE IX
TERMINATION
Section 9.1 Termination. This Agreement may be terminated and the transactions contemplated hereby abandoned at any time prior to the Effective Time, whether before or after receipt of the Company Stockholder Approval:
(a) in writing by mutual consent of the Company and the Purchaser;
(b) by written notice from the Company to the Purchaser or the Purchaser to the Company, as the case may be, in the event the Closing has not occurred before the date that is 100 days after the date of this Agreement (the End Date); provided, however, that the right to terminate this Agreement under this Section 9.1(b) shall not be available to any Party whose breach of any provision of this Agreement has caused or resulted in the failure of the Merger to occur on or before the End Date;
(c) by written notice from the Company to the Purchaser or the Purchaser to the Company, as the case may be, if the consummation of the Merger is permanently enjoined, prohibited or otherwise restrained by the terms of a final, non-appealable order or judgment of a court of competent jurisdiction;
(d) by written notice from the Company to the Purchaser, in the event the Purchaser or Merger Sub (i) fails to perform in any material respect any of their agreements or covenants contained herein required to be performed by them at or prior to the Closing or (ii) breaches any of their representations and warranties contained herein, which failure or breach would result in the failure of either of the closing conditions specified in Section 7.3(b) or Section 7.3(a), respectively, and which failure or breach, if capable of being cured, is not cured by the earlier of the End Date or within ten (10) days following the Company having notified the Purchaser of its intent to terminate this Agreement pursuant to this Section 9.1(d);
(e) by written notice from the Purchaser to the Company, in the event the Company (i) fails to perform in any material respect any of its agreements or covenants contained herein required to be performed by it at or prior to the Closing or (ii) breaches any of its representations and warranties contained herein, which failure or breach would result in the failure of either of the closing conditions specified in Section 7.2(b) or Section 7.2(a), respectively, and which failure or breach, if capable of being cured, is not cured by the earlier of the End Date or within ten (10) days following the Purchaser having notified the Company of its intent to terminate this Agreement pursuant to this Section 9.1(e);
(f) by the Purchaser or the Company, if the DMS Purchase Agreement shall have been terminated or the closing thereunder shall not have occurred by the End Date; or
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(g) by the Purchaser if the Company does not deliver the Company Stockholder Approval within one (1) Business Day of the date hereof.
Section 9.2 Procedures and Effect of Termination. Any Party desiring to terminate this Agreement pursuant to Section 9.1 shall give written notice of such termination to the other Party or Parties, as the case may be, specifying the subsection of Section 9.1 pursuant to which the termination is being made and the facts constituting the basis for such termination. If the transactions contemplated by this Agreement are terminated as provided herein, (a) the Purchaser and Merger Sub shall return all documents and other material received from the Company, its Subsidiaries or the DMS Entities or any of their respective Representatives relating to the transactions contemplated hereby, whether obtained before or after the execution hereof and (b) all Confidential Information received by the Purchaser and Merger Sub with respect to the business of the Company, its Subsidiaries and the DMS Entities shall be treated in accordance with the Confidentiality Agreement, which shall remain in full force and effect notwithstanding the termination of this Agreement. In the event of termination of this Agreement pursuant to this ARTICLE IX, this Agreement shall forthwith become void and there shall be no obligation or liability on the part of any Party or its partners, officers, directors or stockholders, except for (i) obligations under ARTICLE I (Definitions; Construction), Section 6.2(b) (Confidentiality), Section 6.4 (Public Announcements), ARTICLE X (Miscellaneous Provisions) and this Section 9.3, all of which shall survive the termination of this Agreement and (ii) liability of the Company, the Purchaser or Merger Sub, as the case may be, for any intentional and willful breach of this Agreement occurring prior to such termination. For purposes of clarification, the Parties agree that if either Party does not close the transactions contemplated hereby in circumstances in which the closing conditions set forth in Section 7.1, Section 7.2 and Section 7.3, as applicable, have been satisfied or waived, such election shall be deemed to be a willful breach of this Agreement and the non-breaching Party shall retain all other rights and remedies against the breaching Party relating to a willful breach by the breaching Party, including specific performance of this Agreement pursuant to Section 10.17 and recovery of monetary damages.
ARTICLE X
INDEMNIFICATION
Section 10.1 Stockholder Indemnification Obligation. Subject to the provisions of Section 10.3, from and after the Closing, each Stockholder, on a several and not joint basis (in accordance with their Pro Rata Percentage), shall indemnify and hold harmless each of the Purchaser and its Affiliates (including the Surviving Corporation) and their respective Representatives, successors and assigns (each, a Purchaser Indemnitee) from and against any and all Damages sustained or incurred by any Purchaser Indemnitee as a result of or arising from any Closing Date Indebtedness or Transaction Expenses of the Company and its Subsidiaries as of the Closing that is not fully paid or satisfied by the Company at or prior to the Closing, or if paid by the Purchaser at or prior to the Closing, to the extent not deducted in the determination of the Cash Consideration pursuant to Section 3.1; provided, that the total amount of indemnification payable in respect of such Damages shall be limited to the amount of the Stockholder Representative Reserve. Notwithstanding anything to the contrary set forth in this Agreement, any Damages payable to a Purchaser Indemnitee pursuant to this Section 10.1 will be satisfied solely from the Stockholder Representative Reserve.
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Section 10.2 Indemnification Procedures.
(a) Third Party Claims. If any third party shall notify a Purchaser Indemnitee with respect to any matter (a Third Party Claim) that may give rise to a claim for indemnification by the Purchaser Indemnitee against the Stockholder Representative with respect to Closing Date Indebtedness or Transaction Expenses under this ARTICLE X, then the Purchaser Indemnitee shall promptly notify the Stockholder Representative thereof in writing; provided, however, that no delay on the part of the Purchaser Indemnitee in notifying the Stockholder Representative shall relieve the Stockholder Representative from any obligation hereunder except to the extent the Stockholders shall have been materially prejudiced as a result of such failure. The Stockholder Representative will have the right to defend the Purchaser Indemnitee against the Third Party Claim with counsel of its choice reasonably satisfactory to the Purchaser Indemnitee so long as (i) the Stockholder Representative notifies the Purchaser Indemnitee in writing, within five (5) Business Days after the Purchaser Indemnitee has given notice of the Third Party Claim, that the Stockholder Representative will assume the defense of the Third Party Claim, (ii) the Stockholder Representative provides the Purchaser Indemnitee with evidence reasonably acceptable to the Purchaser Indemnitee that the Stockholder Representative will have the financial resources to defend against the Third Party Claim and fulfill the Stockholder Representatives indemnification obligation hereunder, (iii) the Third Party Claim involves only money damages and does not seek an injunction or other equitable relief, (iv) the Stockholder Representative expressly agrees in writing to the Purchaser Indemnitee that, as between the two, the Stockholder Representative is solely obligated to satisfy and discharge the claim and (v) the Stockholder Representative conducts the defense of the Third Party Claim actively and diligently. Notwithstanding the foregoing, if the Purchaser Indemnitee reasonably determines based on the advice of counsel that there may be a conflict between the positions of the Stockholder Representative and the Purchaser Indemnitee in conducting the defense of such Action or that there may be legal defenses available to such Purchaser Indemnitee different from or in addition to those available to the Stockholder Representative, then counsel for the Purchaser Indemnitee shall be entitled to conduct the defense to the extent necessary to protect the interests of the Purchaser Indemnitee, at the expense of the Stockholder Representative.
(b) Direct Claims. In order for a Purchaser Indemnitee to be entitled to indemnification pursuant to this ARTICLE X with respect to Damages that do not result from a Third Party Claim (a Direct Claim), the Purchaser Indemnitee shall notify the Stockholder Representative in writing reasonably promptly after the Purchaser Indemnitee becomes aware of such Direct Claim; provided, however, that the failure to give such notification shall not affect the indemnification provided hereunder except to the extent the Stockholders shall have been materially prejudiced as a result of such failure. The Stockholder Representative shall have thirty (30) days after its receipt of such notice to respond in writing to such Direct Claim. The Purchaser Indemnitee shall give the Stockholder Representative reasonable access during normal business hours, upon reasonable notice, to the books, records, personnel and assets of the Purchaser Indemnitee to investigate the matter or circumstance alleged to give rise to such Direct Claim. If the Stockholder Representative disputes its liability with respect to any such
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claim, the Stockholder Representative and the Purchaser Indemnitee shall proceed to negotiate in good faith a resolution of such dispute and, if not resolved through negotiations within 30 days, the Purchaser Indemnitee shall be free to pursue such remedies as may be available to the Purchaser Indemnitee on the terms and conditions of this Agreement.
Section 10.3 Adjustment of the Merger Consideration. Amounts paid for indemnification under this ARTICLE X shall be deemed to be an adjustment to the Merger Consideration for all Tax purposes, unless otherwise required by Law.
Section 10.4 No Circular Recovery. Notwithstanding anything herein to the contrary, no Stockholder shall make any claim pursuant to this Agreement or pursuant to the constituent documents of the Company with respect to any claim brought by any Purchaser Indemnitee against any Stockholder or relating to this Agreement, the other documents contemplated hereby, or the transactions contemplated hereby or thereby.
ARTICLE XI
MISCELLANEOUS PROVISIONS
Section 11.1 No Survival. The representations, warranties, covenants and agreements in this Agreement shall terminate at the Closing or upon the termination of this Agreement pursuant to ARTICLE IX, except the covenants and agreements that explicitly contemplate performance after the Closing shall survive the Closing indefinitely (or until fully performed in accordance with this Agreement). The Parties acknowledge and agree that from and after the Closing they shall not be permitted to make, and no Party shall have any liability or obligation with respect to, any claims for any breach of any representation or warranty set forth herein or any covenant or agreement herein that is to have been performed by another Party on or prior to the Closing. In furtherance of the foregoing, from and after the Closing, each Party hereby waives (on behalf of itself, each of its Affiliates and each of its Representatives), to the fullest extent permitted under Law, any and all rights, claims and causes of action (including any statutory rights to contribution or indemnification) for any breach of any representation or warranty or covenant or obligation to have been performed prior to the Closing set forth herein or otherwise relating to the Company, any Subsidiary of the Company (directly or indirectly), any DMS Entity or the subject matter of this Agreement that such Party may have against the other Parties hereto or any of their Affiliates or any of their respective Representatives arising under or based upon any theory whatsoever, under any Law, contract, tort or otherwise.
Section 11.2 Notices. All notices and other communications hereunder shall be in writing and shall be deemed to have been duly given when personally delivered, or if sent by United States certified mail, return receipt requested, postage prepaid, shall be deemed duly given on delivery by United States Postal Service, or if sent by facsimile or receipted overnight courier services shall be deemed duly given on the Business Day received if received prior to 5:00 p.m. local time or on the following Business Day if received after 5:00 p.m. local time or on a non-Business Day, addressed to the respective Parties hereto as follows:
To the Purchaser, Merger Sub or, after Closing, to the |
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Surviving Corporation: | Nordson Corporation 28601 Clemens Road Westlake, OH 44145 Attn: General Counsel Fax: (440) 414-5824 | |
with a copy to: | Jones Day North Point 901 Lakeside Ave. Cleveland, OH 44114 Attn: James P. Dougherty Phone: (216) 586-7302 Fax: (216) 579-0212 | |
To the Company: | Vention Medical Holdings, Inc. c/o KRG Capital Partners, L.L.C. 1800 Larimer St., Suite 2200 Denver, CO 80202 Attn: Stew Fisher and Colton King Phone: (303) 390-5001 Fax: (303) 390-5015 | |
with a copy to: | Hogan Lovells US LLP 1601 Wewatta Street, Suite 900 Denver, CO 80202 Attn: Timothy Aragon Phone: (303) 899-7300 Fax: (303) 899-7333 | |
To the Stockholder Representative: |
VMHI Rep Services, LLC 1800 Larimer St., Suite 2200 Denver, CO 80202 Attn: Stew Fisher and Colton King Phone: (303) 390-5001 Fax: (303) 390-5015 | |
with a copy to: | Hogan Lovells US LLP 1601 Wewatta Street, Suite 900 Denver, CO 80202 Attn: Timothy Aragon Phone: (303) 899-7300 Fax: (303) 899-7333 |
or to such other representative or at such other address as such Person may furnish to the other Parties in writing.
Section 11.3 Assignment; Successors in Interest. No assignment or transfer by any Party of such Partys rights and obligations hereunder shall be made except with the prior written
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consent of the other Parties. This Agreement shall be binding upon and shall inure to the benefit of the Parties and their respective successors and permitted assigns, and any reference to a Party shall also be a reference to the successors and permitted assigns thereof.
Section 11.4 Governing Law. This Agreement, and all claims or causes of action (whether in contract, tort or otherwise) that may be based upon, arise out of or relate to this Agreement or the negotiation, execution or performance of this Agreement, shall be governed by and construed in accordance with the internal Laws of the State of Delaware without reference to its choice of law rules.
Section 11.5 Submission to Jurisdiction.
(a) Each Party agrees that any legal action or other legal proceeding relating to this Agreement or the enforcement of any provision of this Agreement shall be brought or otherwise commenced exclusively in the United States District Court for the District of Delaware. Each Party:
(i) expressly and irrevocably consents and submits to the jurisdiction of the United States District Court for the District of Delaware in connection with any such legal proceeding, including to enforce any settlement, order or award;
(ii) consents to service of process in any such proceeding in any manner permitted by the Laws of the State of Delaware, and agrees that service of process by registered or certified mail, return receipt requested, at its address specified pursuant to Section 11.2 is reasonably calculated to give actual notice;
(iii) agrees that the United States District Court for the District of Delaware shall be deemed to be a convenient forum;
(iv) waives and agrees not to assert (by way of motion, as a defense or otherwise), in any such legal proceeding commenced in the United States District Court for the District of Delaware, any claim that such party is not subject personally to the jurisdiction of such court, that such legal proceeding has been brought in an inconvenient forum, that the venue of such proceeding is improper or that this Agreement or the subject matter hereof or thereof may not be enforced in or by such court; and
(v) agrees to the entry of an order to enforce any resolution, settlement, order or award made pursuant to this Section 11.5 by the United States District Court for the District of Delaware and in connection therewith hereby waives, and agrees not to assert by way of motion, as a defense, or otherwise, any claim that such resolution, settlement, order or award is inconsistent with or violative of the laws or public policy of the laws of the State of Delaware or any other jurisdiction.
(b) In the event of any legal action or other legal proceeding relating to this Agreement or the enforcement of any provision of this Agreement, the prevailing Party shall be entitled to payment by the non-prevailing Party of all costs and expenses (including reasonable attorneys fees) incurred by the prevailing Party, including any
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costs and expenses incurred in connection with any challenge to the jurisdiction or the convenience or propriety of venue of proceedings before any state or Federal court located in Delaware.
Section 11.6 Waiver of Jury Trial. TO THE EXTENT NOT PROHIBITED BY LAW WHICH CANNOT BE WAIVED, EACH OF THE PARTIES HEREBY WAIVES AND COVENANTS THAT NEITHER IT NOR ANY OF ITS AFFILIATES SHALL ASSERT (WHETHER AS PLAINTIFF, DEFENDANT OR OTHERWISE) ANY RIGHT TO TRIAL BY JURY IN ANY FORUM IN RESPECT OF ANY ISSUE, ACTION, CLAIM, CAUSE OF ACTION, SUIT (IN CONTRACT, TORT OR OTHERWISE), INQUIRY, PROCEEDING OR INVESTIGATION ARISING OUT OF OR BASED UPON THIS AGREEMENT OR THE OTHER TRANSACTION DOCUMENTS REFERENCED HEREIN OR THE SUBJECT MATTER OF SUCH AGREEMENTS OR IN ANY WAY CONNECTED WITH OR RELATED OR INCIDENTAL TO THE TRANSACTIONS CONTEMPLATED HEREBY, IN EACH CASE WHETHER NOW EXISTING OR HEREAFTER ARISING. THE PURCHASER AND MERGER SUB ACKNOWLEDGE THAT THEY HAVE BEEN INFORMED BY THE COMPANY THAT THIS SECTION 11.6 CONSTITUTES A MATERIAL INDUCEMENT UPON WHICH THE COMPANY IS RELYING AND WILL RELY IN ENTERING INTO THIS AGREEMENT AND THE TRANSACTION DOCUMENTS REFERENCED HEREIN. ANY PARTY MAY FILE AN ORIGINAL COUNTERPART OR A COPY OF THIS SECTION 11.6 WITH ANY COURT AS WRITTEN EVIDENCE OF THE CONSENT OF EACH SUCH PARTY TO THE WAIVER OF ITS RIGHT TO TRIAL BY JURY.
Section 11.7 Severability. Any provision hereof that 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. To the extent permitted by Law, each Party hereby waives any provision of Law that renders any such provision prohibited or unenforceable in any respect.
Section 11.8 Counterparts. This Agreement may be executed by facsimile or electronic mail and in two or more counterparts, each of which shall be deemed an original, and it shall not be necessary in making proof of this Agreement or the terms hereof to produce or account for more than one of such counterparts.
Section 11.9 Parties in Interest. Nothing expressed or implied herein is intended, or shall be construed, to confer upon or give any Person other than the Parties, and their successors or permitted assigns, any right, remedy, obligation or liability under or by reason of this Agreement, or result in such Person being deemed a third-party beneficiary hereof, other than the provisions of (a) Section 6.7 (which are intended for the benefit of the Persons covered thereby or the Persons entitled to payment thereunder and may be enforced by such Persons); (b) ARTICLE II, from and after the Effective Time, which are intended for the benefit of the Stockholders immediately prior to the Effective Time (and their successors, heirs and representatives) and may be enforced by such Stockholders; (c) Section 11.16, which are intended for the benefit of Prior Company Counsel, and may be enforced by such Prior Company
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Counsel; and (d) Section 11.18, which are intended for the benefit of the past, present and future directors, officers, employees, incorporators, members, partners, stockholders, Affiliates, agents, attorneys, advisors and representatives of the Parties, and any Affiliate of any of the foregoing (and their successors, heirs and representatives), and may be enforced by such Persons.
Section 11.10 Amendment, Modification and Waiver. For the period commencing on the date hereof and ending on the Closing Date, this Agreement, including any Exhibit and the Disclosure Schedule, may be amended, modified or supplemented at any time only by written agreement signed by the Parties hereto, any failure of the Company to comply with any term or provision of this Agreement may be waived by the Purchaser, and any failure of the Purchaser or Merger Sub to comply with any term or provision of this Agreement may be waived by the Company, at any time by an instrument in writing signed by or on behalf of such other Party, but such waiver shall not operate as a waiver of, or estoppel with respect to, any subsequent or other failure to comply. From and after the Closing Date, this Agreement, including any Exhibit and the Disclosure Schedule, may be amended, modified or supplemented at any time only by written agreement signed by the Purchaser, the Surviving Corporation and the Stockholder Representative (on behalf of the Stockholders), and any failure of the Purchaser or the Surviving Corporation to comply with any term or provision of this Agreement may be waived by the Stockholder Representative (on behalf of the Stockholders). Further, neither the waiver by any of the Parties hereto of a breach of or a default under any of the provisions of this Agreement, nor the failure by any of the Parties, on one or more occasions, to enforce any of the provisions of this Agreement or to exercise any right or privilege hereunder, shall be construed as a waiver of any other breach or default of a similar nature, or as a waiver of any of such provisions, rights or privileges hereunder.
Section 11.11 Integration. This Agreement and the documents executed pursuant hereto supersede all negotiations, agreements and understandings among the Parties with respect to the subject matter hereof (except for the Confidentiality Agreement) and constitute the entire agreement among the Parties with respect thereto.
Section 11.12 Cooperation Following the Closing. Following the Closing, each Party shall deliver to the other Parties such further information and documents and shall execute and deliver to the other Parties such further instruments and agreements as any other Party shall reasonably request to consummate or confirm the transactions provided for herein, in each case to the extent necessary to accomplish the purpose hereof or to assure to any other Party the benefits hereof.
Section 11.13 Time is of the Essence. Time is of the essence with respect to the transactions contemplated by this Agreement.
Section 11.14 Transaction Costs. Except as provided above or as otherwise expressly provided herein, (a) each of the Purchaser and Merger Sub shall pay its own fees, costs and expenses incurred in connection herewith and the transactions contemplated hereby, including the fees, costs and expenses of its financial advisors, accountants and counsel and (b) the fees, costs and expenses of the Company incurred in connection herewith and the transactions contemplated hereby shall be paid for pursuant to Section 3.5 of this Agreement if the Closing occurs (to the extent then unpaid) and by the Company if the Closing does not occur; provided,
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however, that, in the event that the transactions contemplated hereby are not consummated, (i) the Company shall reimburse the Stockholder Representative for all costs and expenses incurred by the Stockholder Representative in connection with the transactions contemplated hereby, and (ii) the Purchaser and Merger Sub shall pay all fees and expenses in connection with any financing arrangements and other activities taken at their direction, regardless of whether such financing fees and expenses were to be incurred by the Company or any of its Subsidiaries. Notwithstanding the foregoing, the fees and expenses related to any filing made pursuant to the HSR Act and the fees and expenses of the Escrow Agent and the Paying Agent shall be paid entirely by the Purchaser.
Section 11.15 Stockholder Representative.
(a) By the execution and delivery of a Letter of Transmittal, including counterparts thereof, each of the Stockholders will irrevocably constitute and appoint VMHI Rep Services, LLC as the true and lawful agent and attorney-in-fact (the Stockholder Representative) of such Stockholder with full powers of substitution to act in the name, place and stead of such Stockholder with respect to the performance on behalf of such Stockholder under the terms and provisions hereof and to do or refrain from doing all such further acts and things, and to execute all such documents, as the Stockholder Representative shall deem necessary or appropriate in connection with any transaction contemplated hereunder, including the power to: (i) act for such Stockholder with respect to the Working Capital Escrow Amount and the Lithotech Earnout Escrow Amount; (ii) amend, modify or waive any provision of this Agreement, the Paying Agent Agreement or the Escrow Agreement in any manner; (iii) employ, obtain and rely upon the advice of legal counsel, accountants and other professional advisors as the Stockholder Representative, in the sole discretion thereof, deems necessary or advisable in the performance of the duties of the Stockholder Representative; (iv) act for such Stockholder with respect to all Merger Consideration matters and all Merger Consideration adjustment matters referred to herein; (v) incur any expenses, liquidate and withhold assets received on behalf of such Stockholder prior to their distribution to such Stockholder to the extent of any amount that the Stockholder Representative deems necessary for payment of or as a reserve against expenses, and pay such expenses or deposit the same in an interest-bearing bank account established for such purpose, with all such expenses reimbursed to the Stockholder Representative out of amounts received out of the Working Capital Escrow Fund and the Lithotech Earnout Escrow Amount, or if no amounts are received, by reimbursement from the Holders in accordance with their Pro Rata Percentage; (vi) receive all notices, communications and deliveries hereunder on behalf of such Stockholder; (vii) do or refrain from doing any further act or deed on behalf of such Stockholder that the Stockholder Representative deems necessary or appropriate, in the sole discretion of the Stockholder Representative, relating to the subject matter hereof as fully and completely as such Stockholder could do if personally present and acting and as though any reference to such Stockholder herein was a reference to the Stockholder Representative; or (viii) direct, authorize or permit the Paying Agent to take any of the foregoing actions; provided, however, that the Stockholder Representative shall have no obligation to act, except as expressly provided herein.
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(b) The appointment of the Stockholder Representative shall be deemed coupled with an interest and shall be irrevocable, and any other Person may conclusively and absolutely rely, without inquiry, upon any action of the Stockholder Representative as the act of each Stockholder in all matters referred to herein.
(c) In the event the Stockholder Representative resigns or ceases to function in such capacity for any reason whatsoever, then the successor Stockholder Representative shall be the Person appointed by the Holders holding a majority of the Pro Rata Percentages held by all Holders.
(d) The Stockholder Representative Reserve shall be used by the Stockholder Representative to satisfy the obligations of the Stockholder Representative set forth herein, including the indemnification obligation set forth in Section 10.1, and to otherwise permit the Stockholder Representative to perform its obligations set forth herein. As soon as practicable after the date that is nine (9) months after the Closing Date, the Stockholder Representative shall pay to the Paying Agent, which shall be directed to pay each Holders in accordance with Section 2.5 or, in the case of the Option Holders, the Stockholder Representative shall pay to the Company, for the benefit of the Option Holders in accordance with their Pro Rata Percentages (or the Stockholder Representative may deliver such amounts directly to the Holders if the Paying Agent is no longer engaged or if the Stockholder Representative otherwise so determines), any amounts remaining in the Stockholder Representative Reserve.
(e) In furtherance of its role, the Stockholder Representative shall be entitled to incur such reasonable costs and expenses as the Stockholder Representative may deem appropriate under the circumstances, which expenses may include, hiring attorneys, accountants, appraisers and other professional advisors. Such expenses shall be reimbursed from the Stockholder Representative Reserve from time to time upon demand by the Stockholder Representative.
(f) Nothing in this Agreement, the Escrow Agreement or the Paying Agent Agreement is intended, and nothing in this Agreement, the Escrow Agreement or the Paying Agent Agreement shall be interpreted as, imposing upon the Stockholder Representative, solely in its capacity as the agent and attorney-in fact for the Stockholders, any personal liability, personal economic obligation or personal guarantee in favor of any Party to this Agreement or any third party. The Stockholder Representative shall have no liability to the Purchaser, the Company or the Stockholders with respect to actions taken or omitted to be taken in its capacity as the Stockholder Representative.
Section 11.16 Concerning the Companys Counsel; Attorney Client Privilege.
(a) The Purchaser, Merger Sub, the Stockholder Representative (on behalf of the Stockholders), the Company and their respective Affiliates acknowledge and agree that Hogan Lovells US LLP ( Prior Company Counsel) have acted as counsel for the Company, certain of its Affiliates and the DMS Entities for several years and that, in the event of any post-Closing disputes between the Parties, the Stockholders reasonably
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anticipate that Prior Company Counsel may represent certain of them in such matters. Accordingly, the Purchaser, Merger Sub, the Stockholder Representative (on behalf of the Stockholders), the Company and their respective Affiliates expressly consent to Prior Company Counsels representation of one or more of the Stockholders (or the Stockholder Representative) in any post-Closing matter in which the interests of the Purchaser, Merger Sub and the Company on the one hand, and the Stockholders (or the Stockholder Representative) on the other hand, are adverse, whether or not such matter is one in which Prior Company Counsel may have previously advised the Company or its Affiliates and consent to the disclosure by Prior Company Counsel to the Stockholders (or the Stockholder Representative) or any of their Affiliates, directors, members, partners, officers or employees of any information learned by Prior Company Counsel in the course of its representation of the Company, its Affiliates or the DMS Entities, whether or not such information is subject to attorney client privilege or Prior Company Counsels duty of confidentiality. The Purchaser, Merger Sub, the Company and their respective Affiliates further covenant and agree that each shall not assert any claim against Prior Company Counsel in respect of legal services provided to the Company, its Affiliates or the DMS Entities by Prior Company Counsel in connection with this Agreement or the transactions contemplated hereby.
(b) The Parties understand and agree that the Company, its Affiliates and the DMS Entities have been represented by Prior Company Counsel in connection with the transactions contemplated by this Agreement (the Engagement). The Parties further understand and agree that the Company, prior to Closing, and the Stockholder Representative, after the Closing, shall have the sole right to control, assert and waive the attorney-client privilege with respect to any communications at any time between or among the Company, any of its Affiliates or the DMS Entities and Prior Company Counsel relating to the Engagement. Immediately prior to the Closing Date, all documents and communications generated and maintained by the Company, any of its Affiliates or the DMS Entities and Prior Company Counsel in connection with the Engagement shall become the exclusive property of the Stockholder Representative (on behalf of the Stockholders), notwithstanding whether any such documents or communications may be retained in the Surviving Corporations files or may come into the possession of the Purchaser or the Surviving Corporation after the Closing.
(c) The Parties understand and agree that nothing in this Agreement, including the foregoing provision regarding the ownership and assertion of privilege shall be deemed to be a waiver of any applicable attorney-client privilege. The Parties further understand and agree that the Parties have each undertaken reasonable best efforts to prevent the disclosure of confidential or attorney-client privileged information. Notwithstanding those efforts, the Parties further understand and agree that the consummation of the transaction contemplated by this Agreement may result in the inadvertent disclosure of information that may be confidential or subject to a claim of privilege. The Parties further understand and agree that any disclosure of information that may be confidential or subject to a claim of privilege will not prejudice or otherwise constitute a waiver of any claim of privilege. The Parties agree to use reasonable best efforts to return promptly any inadvertently disclosed information to the appropriate Party upon becoming aware of its existence. This Section 11.16 shall be irrevocable, and
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no term of this Section 11.16 may be amended, waived or modified, without the prior written consent of the Stockholder Representative and its Affiliates and Prior Company Counsel affected thereby.
Section 11.17 Specific Performance.
(a) Without limitation of all of the cumulative rights and remedies that a Party may have under this Agreement or to which it is entitled at law or in equity, including the ability to seek recovery for monetary damages, during the period from the date hereof until the earlier of (i) the Closing or (ii) the termination of this Agreement pursuant to ARTICLE IX, the remedies of each Party in the event of a breach by another Party shall include (A) termination of this Agreement in accordance with ARTICLE IX and (B) specific performance in accordance with this Section 11.17. The Parties agree that irreparable damage would occur (for which monetary damages, even if available, would not be an adequate remedy) in the event that any of the provisions of this Agreement were not performed in accordance with their specific terms or were otherwise breached, including a Party failing to take actions as are required of it under the Agreement to consummate the transaction contemplated by this Agreement. Accordingly, it is agreed that the Parties shall be entitled to seek an injunction or injunctions to prevent breaches of this Agreement and to specifically enforce the terms and provisions of this Agreement.
(b) The right to seek specific enforcement is an integral part of the transactions contemplated hereby and each Party hereby agrees not to raise any objections to the availability of an injunction, the equitable remedy of specific performance or other equitable remedy to prevent or restrain breaches of this Agreement by such Party and to specifically enforce the terms and provisions of this Agreement to prevent breaches or threatened breaches of, or to enforce compliance with, the covenants and obligations of such Party under this Agreement all in accordance with the terms of this Section 11.17. Any Party seeking an injunction or injunctions to prevent breaches of this Agreement and to enforce specifically the terms and provisions of this Agreement shall not be required to provide any bond or other security in connection with such order or injunction all in accordance with the terms of this Section 11.17. To the extent any Party brings an action, suit or proceeding to enforce specifically the performance of the terms and provisions of this Agreement (other than an action to enforce specifically any provision that expressly survives termination of this Agreement), the End Date shall automatically be extended to (i) the twentieth (20th) Business Day following the resolution of such action, suit or proceeding or (ii) such other time period established by the court presiding over such action, suit or proceeding.
(c) Nothing in this Agreement shall limit any Persons right to seek and obtain any equitable relief to which such Person shall be entitled or to seek any remedy on account of any Persons fraud or any intentional and willful breach of this Agreement.
Section 11.18 Non-Recourse. This Agreement may only be enforced against, and any claim or cause of action based upon, arising out of, or related to this Agreement or the transactions contemplated hereby may only be brought against, the entities that are expressly named as Parties through a Letter of Transmittal and then only with respect to the specific
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obligations set forth herein with respect to such Party. Except to the extent a named party to this Agreement (and then only to the extent of the specific obligations undertaken by such named party in this Agreement and not otherwise), no past, present or future director, officer, employee, incorporator, member, partner, stockholder, Affiliate, agent, attorney, advisor or Representative or Affiliate of any of the foregoing shall have any liability (whether in contract, tort, equity or otherwise) for any one or more of the representations, warranties, covenants, agreements or other obligations or liabilities of any one or more of the Company or the Purchaser under this Agreement or of or for any claim based on, arising out of, or related to this Agreement or the transactions contemplated hereby.
* * * * * *
[Signature Page Follows]
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IN WITNESS WHEREOF, the Parties have caused this Agreement to be duly executed, as of the date first above written.
COMPANY: | ||
VENTION MEDICAL HOLDINGS, INC. | ||
By: | /s/Stewart A. Fisher | |
Name: | Stewart A. Fisher | |
Title: | Chairperson and Vice President | |
PURCHASER: | ||
NORDSON CORPORATION | ||
By: | /s/Robert E. Veillette | |
Name: | Robert E. Veillette | |
Title: | Vice President, General Counsel & Secretary | |
MERGER SUB: | ||
VIKING MERGER CORP. | ||
By: | /s/Jeffrey A. Pembroke | |
Name: | Jeffrey A. Pembroke | |
Title: | President | |
STOCKHOLDER REPRESENTATIVE: | ||
VMHI REP SERVICES, LLC | ||
By: | /s/Stewart A. Fisher | |
Name: | Stewart A. Fisher | |
Title: | Stockholder Representative |
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Exhibit 2.2
EXECUTION VERSION
FIRST AMENDMENT TO
AGREEMENT AND PLAN OF MERGER
This First Amendment to the Agreement and Plan of Merger (this Amendment), dated March 30, 2017, is by and among NORDSON CORPORATION, an Ohio corporation (the Purchaser), VIKING MERGER CORP., a Delaware corporation (Merger Sub), VENTION MEDICAL HOLDINGS, INC., a Delaware corporation (the Company) and VMHI REP SERVICES, LLC, a Delaware limited liability company, solely in its capacity as Stockholder Representative thereunder, and amends that certain Agreement and Plan of Merger, dated February 20, 2017, by and among Purchaser, Merger Sub, the Company and the Stockholder Representative (the Agreement), as contemplated by Section 11.10 of the Agreement. The capitalized terms used but not defined herein shall have the meanings given to them in the Agreement.
NOW, THEREFORE, the Parties hereby agree as follows:
ARTICLE I
AMENDMENTS
Section 1.1 Tax Matters.
a. | Section 1.1 of the Agreement is hereby amended to (i) delete the definition of Transaction Tax Deductions in its entirety and (ii) replace the definition of Tax Benefit with the following: |
Tax Amount means an amount equal to $11,500,000.
b. | Section 3.1 of the Agreement is hereby amended to add the following immediately after minus (j) the Continuing Transition Employee Compensation: |
plus (k) the Tax Amount
c. | Section 2.5(a)(viii) is hereby amended to delete the following: and (4) without duplication of any amounts described in clause (3), Tax Benefits as a result of Transaction Tax Deductions that are payable to the Holders pursuant to and in accordance with Section 6.9(k). |
d. | Section 2.5(a)(ix) is hereby amended to delete the following: and (4) without duplication of any amounts described in clause (3), Tax Benefits as a result of Transaction Tax Deductions that are payable to the Holders pursuant to and in accordance with Section 6.9(k). |
e. | Section 6.9(e) of the Agreement is hereby deleted in its entirety and replaced with the following: [Intentionally Omitted]. |
f. | Section 6.9(i)(i) of the Agreement is hereby deleted in its entirety and |
replaced with the following: [Intentionally Omitted]. |
g. | Section 6.9(k) of the Agreement is hereby deleted in its entirety and replaced with the following: [Intentionally Omitted]. |
ARTICLE II
MISCELLANEOUS
Section 2.1 Effect of Amendment. Except as and to the extent expressly modified by this Amendment, the Agreement, as so amended by this Amendment, will remain in full force and effect in all respects. Each reference to hereof, herein, hereby, and this Agreement in the Agreement will from and after the effective date hereof refer to the Agreement as amended by this Amendment.
Section 2.2 Integration. This Amendment, together with the Agreement and the documents executed pursuant thereto, supersede all negotiations, agreements and understandings among the Parties with respect to the subject matter hereof (except for the Confidentiality Agreement) and constitute the entire agreement between the Parties with respect thereto.
Section 2.3 Governing Law; Submission to Jurisdiction; Waiver of Jury Trial. Sections 11.4, 11.5 and 11.6, in each case, of the Agreement are incorporated into this Amendment by reference as if fully set forth herein, mutatis mutandis.
Section 2.4 Notices. All notices and other communications hereunder will be in writing and sent pursuant to the requirements of Section 11.2 of the Agreement.
Section 2.5 Headings. The insertion of headings are for convenience of reference only and shall not affect or be utilized in construing or interpreting this Amendment.
Section 2.7 Counterparts. This Amendment may be executed by facsimile or electronic mail and in two or more counterparts, each of which shall be deemed an original, and it shall not be necessary in making proof of this Amendment or the terms hereof to produce or account for more than one of such counterparts.
[Signature page follows.]
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IN WITNESS WHEREOF, the Parties have caused this Amendment to be executed as of the day and year first written above.
COMPANY: | ||
VENTION MEDICAL HOLDINGS, INC. | ||
By: | /s/Daniel C. Croteau | |
Name: | Daniel C. Croteau | |
Title: | President & Chief Executive Officer |
IN WITNESS WHEREOF, the Parties have caused this Amendment to be executed as of the day and year first written above.
PURCHASER: | ||
NORDSON CORPORATION | ||
By: | /s/Robert E. Veillette | |
Name: | Robert E. Veillette | |
Title: | Vice President, General Counsel & Secretary |
IN WITNESS WHEREOF, the Parties have caused this Amendment to be executed as of the day and year first written above.
MERGER SUB: | ||
VIKING MERGER CORP. | ||
By: | /s/Jeffrey A. Pembroke | |
Name: | Jeffrey A. Pembroke | |
Title: | President |
IN WITNESS WHEREOF, the Parties have caused this Amendment to be executed as of the day and year first written above.
STOCKHOLDER REPRESENTATIVE: | ||
VMHI REP SERVICES, LLC | ||
By: |
/s/Colton J. King | |
Name: |
Colton J. King | |
Title: |
President and Treasurer |
Exhibit 4.1
EXECUTION VERSION
FIRST AMENDMENT AND JOINDER TO
TERM LOAN AGREEMENT
This First Amendment and Joinder to Term Loan Agreement (this Amendment) dated as of March 31, 2017, is made by and among NORDSON CORPORATION, an Ohio corporation (the Borrower), each of the Joining Lenders (as defined below), and PNC BANK, NATIONAL ASSOCIATION, in its capacity as a Lender and as administrative agent for the Lenders (in such capacity as administrative gent, the Agent).
WITNESSETH:
WHEREAS, the Borrower, Agent and PNC Bank, National Association, in its capacity as a Lender (the Original Lender), have entered into that certain Term Loan Agreement dated as of February 21, 2017 (as amended, restated, supplemented or otherwise modified prior to the date hereof, the Existing Loan Agreement), pursuant to which the Original Lender has committed to make the Loans available to the Borrower subject to the terms and conditions set forth in the Existing Loan Agreement;
WHEREAS, prior to the funding of the Loans under the Existing Loan Agreement each of the financial institutions (other than the Original Lender) set forth in Schedule 1 attached hereto (collectively, the Joining Lenders) wishes to join the Existing Loan Agreement, as a Lender, and fund a portion of the Loans on the Closing Date (the Joinder);
WHEREAS, the Borrower has requested the Agent and the Lenders to amend the Existing Loan Agreement to effectuate the Joinder and to make certain other amendments to the Existing Loan Agreement in such a manner that, upon giving effect to the Joinder and such other amendments, the Existing Loan Agreement as so amended would contain the terms, covenants, conditions and other provisions as contained in the form set forth as Exhibit A to this Amendment (the Existing Loan Agreement, as amended hereby, the Amended Loan Agreement);
WHEREAS, the Agent and the Lenders signatory hereto (including, without limitation, the Joining Lenders) are agreeable to amend the Existing Loan Agreement subject to the terms and conditions set forth in this Amendment; and
NOW, THEREFORE, in consideration of the premises and further valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:
1. Definitions. Capitalized terms not otherwise defined in this Amendment have the respective meanings assigned thereto in the Amended Loan Agreement.
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2. Lender Joinder.
(a) Each Joining Lender acknowledges, agrees and confirms, by its execution of this Amendment, (i) it will be deemed to be a party to the Amended Loan Agreement as a Lender for all purposes of the Amended Loan Agreement and the other Loan Documents, and shall have all of the obligations of a Lender under the Amended Loan Agreement as if it had executed the Amended Loan Agreement and be subject to the other Loan Documents as a Lender; (ii) to be bound by all of the terms, provisions and conditions contained in the Amended Loan Agreement and the other Loan Documents that are applicable to Lenders thereunder; (iii) its Commitments and Commitment Percentage shall be as set forth on Schedule 1 to the Amended Loan Agreement (after giving effect to this Amendment); (iv) it has received a copy of the Amended Loan Agreement and the other Loan Documents, copies of the most recent financial statements required to be delivered (or made available by filings with the SEC) pursuant to the Amended Loan Agreement and such other documents and information as it deems appropriate, independently and without reliance upon the Agent, any other Lender or any of their Related Parties, to make its own credit analysis and decision to enter into this Amendment and to become a Lender under the Amended Loan Agreement and the other Loan Documents; (v) it will, independently and without reliance upon the Agent, any other Lender or any of their Related Parties and based on such documents and information as it shall from time to time deem appropriate, continue to make its own decisions in taking or not taking action under or based upon the Amended Loan Agreement, any other Loan Document or any related agreement or any document furnished hereunder or thereunder; (vi) it is permitted under Section 10.10 of the Existing Loan Agreement and the Amended Loan Agreement to be a Lender; and (vii) it has full power and authority, and has taken all action necessary, to execute and deliver this Amendment and to consummate the transactions contemplated by the Amended Loan Agreement and hereby and to become a Lender under the Amended Loan Agreement and the other Loan Documents.
(b) Simultaneously with the effectiveness of this Amendment, the parties hereby agree that, notwithstanding the provisions regarding assignments set forth in Section 10.10 of the Existing Loan Agreement or the Amended Loan Agreement, the Commitments and Commitment Percentage of all Lenders shall be as set forth in Schedule 1 of the Amended Loan Agreement (after giving effect to this Amendment) and the requisite assignments shall be deemed to be made in such amounts by and between the Lenders and from each Lender to each other Lender, with the same force and effect as if such assignments were evidenced by applicable Assignment Agreements. Notwithstanding anything to the contrary in Section 10.10 of the Existing Loan Agreement or the Amended Loan Agreement, no other documents or instruments, including any Assignment Agreements, shall be executed in connection with these assignments (all of which requirements are hereby waived), and such assignments shall be deemed to be made with all applicable representations, warranties and covenants as if evidenced by an Assignment Agreement.
3. Amendments to Existing Loan Agreement.
(a) Subject to the terms and conditions set forth herein, and in reliance upon the representations and warranties of the Borrower made herein, the Existing Loan Agreement (other than the schedules and the exhibits attached thereto) is hereby
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amended so that, as amended, it shall read as set forth in, and shall have the terms, covenants, conditions and other provisions of, the Amended Credit Agreement, the terms, covenants, conditions and other provisions of which Amended Credit Agreement are hereby incorporated by reference into this Amendment as if fully set forth herein. The parties hereto acknowledge and agree that each amendment to the Existing Loan Agreement reflected in the Amended Credit Agreement is and shall be effective as if individually specified in this Amendment (the parties further acknowledging that amending the Existing Loan Agreement by reference to the Amended Credit Agreement provides a convenience to the parties to permit the amended terms to be read in the context of the full Amended Credit Agreement), and that this Amendment is not a novation of the Existing Loan Agreement, any other Loan Document or of any credit facility or guaranty provided thereunder or in respect thereof.
(b) Schedule 1 to the Existing Loan Agreement is hereby amended and restated in its entirety as set forth in Schedule 1 attached hereto.
4. Effectiveness; Conditions Precedent. The effectiveness of this Amendment and the amendments to the Existing Loan Agreement contained herein are subject to the Agents receipt of one or more counterparts of this Amendment, duly executed by the Borrower, the Agent and the Lenders (including, without limitation, the Joining Lenders).
5. Representations and Warranties. In order to induce the Agent and the Lenders to enter into this Amendment, the Borrower hereby represents and warrants as follows as of the date hereof:
(a) | no Event of Default exists; |
(b) | each of the representations and warranties contained in Article VI of the Amended Loan Agreement and in the other Loan Documents are true and correct in all material respects (except such representations and warranties that are qualified by materiality, which shall be true and correct in all respects) (except to the extent that any such representations and warranties relates to an earlier date or period, in which case such representations and warranties shall have been true and correct in all material respects on and as of such earlier date or period (except such representations and warranties that are qualified by materiality, which shall be true and correct in all respects on and as of such earlier date or period)); and |
(c) | no change, occurrence or development shall have occurred since October 31, 2016, that has had or could reasonably be expected to have a material adverse effect on the business, operations, property or condition (financial or otherwise) of Borrower and its Subsidiaries taken as a whole. |
6. Entire Agreement. This Amendment, together with all the Loan Documents executed in connection herewith (collectively, the Relevant Documents), sets forth the entire understanding and agreement of the parties hereto in relation to the subject matter hereof and supersedes any prior negotiations and agreements among the parties relating to such subject
3
matter. No promise, condition, representation or warranty, express or implied, not set forth in the Relevant Documents shall bind any party hereto, and no such party has relied on any such promise, condition, representation or warranty. Each of the parties hereto acknowledges that, except as otherwise expressly stated in the Relevant Documents, no representations, warranties or commitments, express or implied, have been made by any party to the other with respect to the subject matter hereof. None of the terms or conditions of this Amendment may be changed, modified, waived or canceled orally or otherwise, except in writing and in accordance with Section 10.03 of the Amended Loan Agreement.
7. Full Force and Effect of Agreement; No Novation. Except as hereby specifically amended, modified or supplemented herein, the Existing Loan Agreement and all other Loan Documents are hereby confirmed and ratified in all respects and shall be and remain in full force and effect according to their respective terms. The parties hereto acknowledge and agree that (a) the amendments contained herein do not constitute a novation of the Existing Loan Agreement, the other Loan Documents or the Indebtedness described therein and (b) the issuance of any new Notes, in any event, including, without limitation to, in replacement of, and in substitution for, the Notes previously delivered pursuant to the Existing Loan Agreement (as in effect prior to giving effect to this Amendment) shall not be construed as a novation and shall not, in any case, affect, diminish or abrogate the Borrowers liability under the Existing Loan Agreement, the Amended Loan Agreement or any other Loan Document or the priority of the Existing Loan Agreement, the Amended Loan Agreement or any other Loan Document.
8. Counterparts. This Amendment may be executed in any number of counterparts and by different parties hereto in separate counterparts and by facsimile signature, each of which when so executed and delivered shall be deemed to be an original and all of which taken together shall constitute but one and the same agreement.
9. Governing Law. THIS AMENDMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF OHIO AND THE RESPECTIVE RIGHTS AND OBLIGATIONS OF BORROWER, AGENT AND THE LENDERS SHALL BE GOVERNED BY OHIO LAW, WITHOUT REGARD TO PRINCIPLES OF CONFLICT OF LAWS, AND SHALL BE FURTHER SUBJECT TO THE PROVISIONS OF SECTION 10.15 OF THE AMENDED LOAN AGREEMENT.
10. Severability Of Provisions; Captions; Attachments. Any provision of this Amendment that 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 or affecting the validity or enforceability of such provision in any other jurisdiction. The several captions to Sections and subsections herein are inserted for convenience only and shall be ignored in interpreting the provisions of this Amendment. Each schedule or exhibit attached to this Amendment shall be incorporated herein and shall be deemed to be a part hereof.
11. References. All references in any of the Loan Documents to the Credit Agreement or Loan Agreement shall mean the Amended Loan Agreement, as further amended, modified, supplemented or restated from time to time in accordance with the terms of the Amended Loan Agreement.
4
12. Binding Effect; Borrower Assignment. This Amendment shall be binding upon and inure to the benefit of Borrower, Agent and each of the Lenders and their respective successors and assigns, except that Borrower shall not have the right to assign its rights hereunder or any interest herein without the prior written consent of Agent and all of the Lenders.
[Signature pages follow.]
5
IN WITNESS WHEREOF, the parties hereto have caused this instrument to be made, executed and delivered by their duly authorized officers as of the day and year first above written.
NORDSON CORPORATION, as Borrower | ||
By: | /s/Gregory A. Thaxton | |
Name: | Gregory A. Thaxton | |
Title: | Senior Vice President, Chief Financial Officer |
PNC BANK, NATIONAL ASSOCIATION, as Agent and a Lender | ||
By: | /s/Joseph G. Moran | |
Name: | Joseph G. Moran | |
Title: | Senior Vice President |
2
BANK OF AMERICA, N.A., as a Lender | ||
By: | /s/Richard R. Powell | |
Name: | Richard R. Powell | |
Title: | Vice President | |
Address: | ||
1600 JFK Blvd., Suite 1100 | ||
Philadelphia PA 19103 | ||
Attention: Richard Powell | ||
Telephone: 267-675-0359 | ||
Telecopy: 646-834-9736 | ||
Email: Richard.r.powell@baml.com |
3
JPMORGAN CHASE BANK, NATIONAL ASSOCIATION, as a Lender | ||
By: | /s/Dana J. Moran | |
Name: | Dana J. Moran | |
Title: | Executive Director | |
Address: | ||
10 South Dearborn | ||
Floor 9, Suite IL-0364 | ||
Chicago, IL 60603 |
4
WELLS FARGO BANK, NATIONAL ASSOCIATION, as a Lender | ||
By: | /s/Kay Reedy | |
Name: | Kay Reedy | |
Title: | Managing Director | |
Address: | ||
10 South Wacker Drive, 22nd Floor | ||
Chicago, IL 60606 | ||
Attention: Nick Kepler | ||
Telephone: 312-845-4398 | ||
Telecopy: 312-553-4783 | ||
Email: Nickolas.R.Kepler@wellsfargo.com |
5
BRANCH BANKING AND TRUST COMPANY, as a Lender | ||
By: | /s/Ryan T. Hamilton | |
Name: | Ryan T. Hamilton | |
Title: | Vice President | |
Address: | ||
401 W. Main Street, Suite 200 | ||
Louisville, KY 40202 | ||
Attention: Ryan Hamilton | ||
Telephone: 502-562-7993 | ||
Email: rhamilton@bbandt.com |
6
KEYBANK NATIONAL ASSOCIATION, as a Lender | ||
By: | /s/Brian P. Fox | |
Name: | Brian P. Fox | |
Title: | Senior Vice President | |
Address: | ||
127 Public Square | ||
Cleveland, OH 44114 | ||
Attention: Brian Fox | ||
Telephone: 216-689-4599 | ||
Email: brian.fox@key.com |
7
HSBC BANK USA, N.A., as a Lender | ||
By: | /s/Casey DeMarco | |
Name: | Casey DeMarco | |
Title: | Assistant Vice President | |
Address: | ||
95 Washington St. | ||
Buffalo, NY 14203 | ||
Attention: Casey DeMarco | ||
Telephone: 716-841-1942 | ||
Email: Casey.m.demarco@us.hsbc.com |
8
U.S. BANK NATIONAL ASSOCIATION, as a Lender | ||
By: | /s/Ken Gorski | |
Name: | Ken Gorski | |
Title: | Vice President | |
Address: | ||
425 Walnut Street | ||
Cincinnati, OH 45202 | ||
Attention: Kenneth Gorski | ||
Telephone: 513-632-3961 | ||
Telecopy: 513-632-2068 | ||
Email: Kenneth.gorski@usbank.com |
9
THE BANK OF TOKYO-MITSUBISHI UFJ, LTD., as a Lender | ||
By: | /s/Mark Maloney | |
Name: | Mark Maloney | |
Title: | Authorized Signatory | |
Address: | ||
227 West Monroe Street, Suite 1550 | ||
Chicago, IL 60606 | ||
Attention: Timothy Cassidy | ||
Telephone: 312-696-4668 | ||
Telecopy: 312-696-4535 | ||
Email: tcassidy@us.mufg.ip |
10
COMMERZBANK AG, NEW YORK BRANCH, as a Lender | ||
By: | /s/Michael Ravelo | |
Name: | Michael Ravelo | |
Title: | Director | |
Address: | ||
225 Liberty Street | ||
New York, New York 10281 | ||
Attention: Anne Culver | ||
Telephone: 212-895-6884 | ||
Telecopy: | ||
Email: Anne.culver@commerzbank.com |
11
COMPASS BANK, as a Lender | ||
By: | /s/Veronica Cohen | |
Name: | Veronica Cohen | |
Title: | Portfolio Manager | |
Address: | ||
8333 Douglas Avenue, 2nd Floor | ||
Dallas, TX 75225 | ||
Attention: Debbie Alvarado | ||
Telephone: 214-360-1944 | ||
Telecopy: 866-984-8668 | ||
Email: ldfclargemiddlemarket.group@bbva.com |
12
BMO HARRIS BANK N.A., as a Lender | ||
By: | /s/Thomas Hasenauer | |
Name: | Thomas Hasenauer | |
Title: | Director | |
Address: | ||
115 South LaSalle Street | ||
25th Floor West | ||
Chicago, IL 60603 | ||
Attention: Anne Robles | ||
Telephone: 312-461-1403 | ||
Telecopy: 312-293-4327 | ||
Email: Anne.Robles@bmo.com |
13
MORGAN STANLEY BANK, N.A., as a Lender | ||
By: | /s/Michael King | |
Name: | Michael King | |
Title: | Authorized Signatory | |
Address: | ||
One Utah Center. 201 South Main Street, 5th Floor | ||
Salt Lake City, Utah 84111 |
14
CHEMICAL BANK, as a Lender | ||
By: | /s/Michael H. Babb | |
Name: | Michael H. Babb | |
Title: | First Vice President | |
Address: | ||
23240 Chagrin Blvd., Suite 600 | ||
Beachwood, OH 44122 | ||
Attention: Michael H. Babb | ||
Telephone: 216-706-3611 | ||
Telecopy: 216-706-3734 | ||
Email: Michael.Babb@ChemicalBank.com |
15
FIRST NATIONAL BANK OF PENNSYLVANIA, as a Lender | ||
By: | /s/Matthew Kuchta | |
Name: | Matthew Kuchta | |
Title: | Vice President | |
Address: | ||
55 Public Square, Suite 1460 | ||
Cleveland, OH 44113 | ||
Attention: Matt Kuchta | ||
Telephone: 216-205-4554 | ||
Telecopy: 216-205-4084 | ||
Email: Kuchtam@fnb-corp.com |
16
CITIZENS BANK, N.A., as a Lender | ||
By: | /s/Jonathan Gleit | |
Name: | Jonathan Gleit | |
Title: | Senior Vice President | |
Address: | ||
27777 Franklin Road | ||
Southfield, MI 48034 | ||
Attention: Jonathan Gleit | ||
Telephone: 248-226-7861 | ||
Email: Jonathan.gleit@citizensbank.com |
17
THE HUNTINGTON NATIONAL BANK, as a Lender | ||
By: | /s/Brian H. Gallagher | |
Name: | Brian H. Gallagher | |
Title: | Senior Vice President | |
Address: | ||
200 Public Square | ||
Cleveland, OH 44114 | ||
Attention: Brian H. Gallagher | ||
Telephone: 216-515-6610 | ||
Telecopy: 877-818-5900 | ||
Email: brian.gallagher@huntington.com |
18
THE NORTHERN TRUST COMPANY, as a Lender | ||
By: | /s/John Di Legge | |
Name: | John Di Legge | |
Title: | Senior Vice President | |
Address: | ||
50 South LaSalle, M-27 | ||
Chicago, IL 60603 | ||
Attention: John DiLegge | ||
Telephone: 312-444-5653 | ||
Telecopy: 312-557-1425 | ||
Email: jd243@ntrs.com |
19
DEAL CUSIP NUMBER: 65566EAH1
TERM LOAN CUSIP NUMBERS: Eighteen Month Term Loan: 65566EAK4
Three Year Term Loan: 65566EAL2
Five Year Term Loan: 65566EAJ7
$705,000,000 TERM LOAN FACILITY
TERM LOAN AGREEMENT1
by and among
NORDSON CORPORATION
and
THE LENDERS PARTY HERETO
and
PNC BANK, NATIONAL ASSOCIATION,
as Administrative Agent
and
PNC CAPITAL MARKETS LLC,
MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED,
JPMORGAN CHASE BANK, NATIONAL ASSOCIATION,
WELLS FARGO SECURITIES, LLC,
BB&T CAPITAL MARKETS,
KEYBANC CAPITAL MARKETS INC.,
as Joint Lead Arrangers and Joint Bookrunners
and
BANK OF AMERICA, N.A.,
JPMORGAN CHASE BANK, NATIONAL ASSOCIATION,
WELLS FARGO BANK, NATIONAL ASSOCIATION,
BRANCH BANKING AND TRUST COMPANY,
KEYBANK NATIONAL ASSOCIATION,
as Co-Syndication Agents
and
HSBC BANK USA, N.A.,
U.S. BANK NATIONAL ASSOCIATION,
as Co-Documentation Agents
Dated as of February 21, 2017
1 | As amended by the First Amendment and Joinder to Term Loan Agreement dated as of March 31, 2017. |
20
TABLE OF CONTENTS
Page | ||||||
ARTICLE I |
DEFINITIONS | 1 | ||||
Section 1.01 |
Definitions |
1 | ||||
Section 1.02 |
Accounting and Legal Principles, Terms and Determinations |
22 | ||||
Section 1.03 |
Terms Generally |
23 | ||||
ARTICLE II |
AMOUNT AND TERMS OF CREDIT | 23 | ||||
Section 2.01 |
Amount and Nature of Credit |
23 | ||||
Section 2.02 |
Conditions To Loans and Conversion/Continuation of Loans |
26 | ||||
Section 2.03 |
Payments, Etc |
27 | ||||
Section 2.04 |
Prepayment |
28 | ||||
Section 2.05 |
Fees |
29 | ||||
Section 2.06 |
Computation of Interest and Fees; Default Rate |
29 | ||||
Section 2.07 |
Defaulting Lender |
29 | ||||
ARTICLE III |
INCREASED CAPITAL; TAXES, ETC | 31 | ||||
Section 3.01 |
Increased Costs |
31 | ||||
Section 3.02 |
Tax Law, Etc |
32 | ||||
Section 3.03 |
Eurodollar Deposits Unavailable or Interest Rate Unascertainable |
35 | ||||
Section 3.04 |
Indemnity |
35 | ||||
Section 3.05 |
Changes in Law Rendering Eurodollar Loans Unlawful |
35 | ||||
Section 3.06 |
Funding |
36 | ||||
Section 3.07 |
Capital Adequacy |
36 | ||||
Section 3.08 |
Application of Provisions |
36 | ||||
Section 3.09 |
Replacement of Lenders |
36 | ||||
ARTICLE IV |
CONDITIONS PRECEDENT | 37 | ||||
Section 4.01 |
Conditions to Effective Date |
37 | ||||
Section 4.02 |
Conditions to Closing Date |
39 | ||||
ARTICLE V |
COVENANTS | 42 | ||||
Section 5.01 |
Financial Statements |
42 | ||||
Section 5.02 |
Franchises |
44 | ||||
Section 5.03 |
ERISA Compliance |
44 |
-i-
TABLE OF CONTENTS
(continued)
Page | ||||||
Section 5.04 |
Financial Covenants |
44 | ||||
Section 5.05 |
Indebtedness |
44 | ||||
Section 5.06 |
Liens |
45 | ||||
Section 5.07 |
Merger and Sale of Assets |
46 | ||||
Section 5.08 |
Acquisitions |
47 | ||||
Section 5.09 |
Regulations U and X |
47 | ||||
Section 5.10 |
Notice |
47 | ||||
Section 5.11 |
Environmental Compliance |
47 | ||||
Section 5.12 |
Restricted Payments |
48 | ||||
Section 5.13 |
Use of Proceeds |
48 | ||||
Section 5.14 |
Restrictive Agreements |
48 | ||||
Section 5.15 |
Guaranties of Payment; Guaranty Under Material Indebtedness Agreement |
48 | ||||
Section 5.16 |
Pari Passu Ranking |
49 | ||||
Section 5.17 |
Terrorism Sanctions Regulations and Compliance with Laws |
49 | ||||
Section 5.18 |
Changes in Closing Date Acquisition Documents |
49 | ||||
ARTICLE VI |
REPRESENTATIONS AND WARRANTIES | 49 | ||||
Section 6.01 |
Organization; Subsidiary Preferred Equity |
49 | ||||
Section 6.02 |
Power and Authority |
50 | ||||
Section 6.03 |
Compliance with Laws |
50 | ||||
Section 6.04 |
Litigation and Administrative Proceedings |
50 | ||||
Section 6.05 |
Title to Assets |
51 | ||||
Section 6.06 |
Liens and Security Interests |
51 | ||||
Section 6.07 |
Tax Returns |
51 | ||||
Section 6.08 |
Environmental Laws |
51 | ||||
Section 6.09 |
Employee Benefit Plans |
52 | ||||
Section 6.10 |
Consents or Approvals |
52 | ||||
Section 6.11 |
Solvency |
52 | ||||
Section 6.12 |
Financial Statements |
53 | ||||
Section 6.13 |
Regulations |
53 |
-ii-
TABLE OF CONTENTS
(continued)
Page | ||||||
Section 6.14 |
Investment Company; Holding Company |
53 | ||||
Section 6.15 |
Accurate and Complete Statements |
53 | ||||
Section 6.16 |
Defaults |
53 | ||||
Section 6.17 |
Anti-Terrorism Law and Anti-Corruption Law Compliance |
53 | ||||
Section 6.18 |
EEA Financial Institutions |
54 | ||||
Section 6.19 |
Pari Passu Ranking |
54 | ||||
ARTICLE VII |
EVENTS OF DEFAULT | 54 | ||||
Section 7.01 |
Payments |
54 | ||||
Section 7.02 |
Special Covenants |
54 | ||||
Section 7.03 |
Other Covenants |
54 | ||||
Section 7.04 |
Representations and Warranties |
54 | ||||
Section 7.05 |
Cross Default |
54 | ||||
Section 7.06 |
ERISA Default |
54 | ||||
Section 7.07 |
Change Of Control |
54 | ||||
Section 7.08 |
Money Judgment |
55 | ||||
Section 7.09 |
Validity of Loan Documents |
55 | ||||
Section 7.10 |
Insolvency |
55 | ||||
ARTICLE VIII |
REMEDIES UPON DEFAULT | 55 | ||||
Section 8.01 |
Optional Defaults |
55 | ||||
Section 8.02 |
Automatic Defaults |
56 | ||||
Section 8.03 |
Offsets |
56 | ||||
Section 8.04 |
Equalization Provision |
56 | ||||
ARTICLE IX |
THE AGENT | 56 | ||||
Section 9.01 |
Appointment and Authorization |
57 | ||||
Section 9.02 |
Note Holders |
57 | ||||
Section 9.03 |
Consultation With Counsel |
57 | ||||
Section 9.04 |
Documents |
57 | ||||
Section 9.05 |
Agent and Affiliates |
57 | ||||
Section 9.06 |
Knowledge of Default |
57 | ||||
Section 9.07 |
Action By Agent |
57 |
-iii-
TABLE OF CONTENTS
(continued)
Page | ||||||
Section 9.08 |
Notices, Default, Etc |
57 | ||||
Section 9.09 |
Indemnification of Agent |
58 | ||||
Section 9.10 |
Successor Agent |
58 | ||||
Section 9.11 |
No Reliance on Agents Customer Identification Program |
58 | ||||
Section 9.12 |
USA Patriot Act |
58 | ||||
Section 9.13 |
Other Agents |
59 | ||||
ARTICLE X |
MISCELLANEOUS |
59 | ||||
Section 10.01 |
Lenders Independent Investigation |
59 | ||||
Section 10.02 |
No Waiver; Cumulative Remedies |
59 | ||||
Section 10.03 |
Amendments; Consents |
59 | ||||
Section 10.04 |
Notices |
60 | ||||
Section 10.05 |
Costs, Expenses and Taxes |
60 | ||||
Section 10.06 |
Indemnification |
61 | ||||
Section 10.07 |
Obligations Several; No Fiduciary Obligations |
61 | ||||
Section 10.08 |
Execution In Counterparts |
61 | ||||
Section 10.09 |
Binding Effect; Borrower Assignment |
61 | ||||
Section 10.10 |
Assignments |
61 | ||||
Section 10.11 |
Participations |
63 | ||||
Section 10.12 |
Severability Of Provisions; Captions; Attachments |
64 | ||||
Section 10.13 |
Investment Purpose |
65 | ||||
Section 10.14 |
Entire Agreement |
65 | ||||
Section 10.15 |
Governing Law; Submission to Jurisdiction |
65 | ||||
Section 10.16 |
Legal Representation of Parties |
65 | ||||
Section 10.17 |
Treatment of Certain Information; Confidentiality |
65 | ||||
Section 10.18 |
JURY TRIAL WAIVER |
66 | ||||
Section 10.19 |
Acknowledgement and Consent to Bail-In of EEA Financial Institutions |
66 | ||||
Section 10.20 |
USA Patriot Act Notice |
67 |
-iv-
LIST OF SCHEDULES AND EXHIBITS
Schedules: | ||||
Schedule 1 |
- |
Lenders and Commitments | ||
Schedule 6.04 |
- |
Litigation |
Exhibits | ||
EXHIBIT A - FORM OF FIVE YEAR TERM LOAN NOTE | ||
EXHIBIT B - FORM OF THREE YEAR TERM LOAN NOTE | ||
EXHIBIT C - FORM OF EIGHTEEN MONTH TERM LOAN NOTE EXHIBIT D - NOTICE OF LOAN | ||
EXHIBIT E - COMPLIANCE CERTIFICATE | ||
EXHIBIT F - FORM OF ASSIGNMENT AND ASSUMPTION AGREEMENT | ||
EXHIBIT G - FORM OF GUARANTY OF PAYMENT | ||
EXHIBIT H - FORM OF SOLVENCY CERTIFICATE |
TERM LOAN AGREEMENT
This TERM LOAN AGREEMENT (as the same may from time to time be amended, restated or otherwise modified, this Agreement) is dated as of February 21, 2017, among the following:
(i) NORDSON CORPORATION, an Ohio corporation (Borrower);
(ii) the financial institutions from time to time a party hereto (including any such institution that becomes a party hereto pursuant to Section 10.10 hereof, collectively, Lenders, and individually each a Lender); and
(iii) PNC BANK, NATIONAL ASSOCIATION, as Administrative Agent for the Lenders under this Agreement (in such capacity as Administrative Agent, Agent).
WITNESSETH:
WHEREAS, Borrower, Agent and the Lenders desire to contract for the establishment of three term loan facilities in an aggregate principal amount not in excess of Seven Hundred Five Million Dollars ($705,000,000), to be made available to Borrower upon the terms and subject to the conditions hereinafter set forth;
NOW, THEREFORE, it is mutually agreed as follows:
ARTICLE I
DEFINITIONS
Section 1.01 Definitions. As used in this Agreement, the following terms shall have the following meanings:
2012 Senior Note Purchase Agreement shall mean the Master Note Purchase Agreement, dated as of July 26, 2012 (as the same may be amended, modified, restated, supplemented, replaced or refinanced from time to time), pursuant to which Borrower issued and sold Two Hundred Million Dollars ($200,000,000) of its senior notes thereunder.
2015 Note Purchase Agreement shall mean the Master Note Purchase Agreement, dated as of July 28, 2015 (as the same may be amended, modified, restated, supplemented, replaced or refinanced from time to time), pursuant to which Borrower has issued and sold its senior notes thereunder in an aggregate principal amount of One Hundred Million Dollars ($100,000,000).
2016 NYLIM Note Purchase Agreement shall mean the Amended and Restated Note Purchase and Private Shelf Agreement, dated as of September 30, 2016 (as the same may be amended, modified, restated, supplemented, replaced or refinanced from time to time), pursuant to which Borrower has issued and sold its senior notes thereunder in an aggregate principal amount of Two Hundred Million Dollars ($200,000,000) and may issue and sell additional senior notes thereunder with all such senior notes outstanding thereunder at any time not to exceed Two Hundred Million Dollars ($200,000,000).
Acquisition shall mean any transaction or series of related transactions for the purpose of or resulting, directly or indirectly, in (a) the acquisition of all or substantially all of the assets of any Person, or any business or division of any Person, (b) the acquisition of in excess of fifty percent (50%) of the stock (or other equity interest) of any Person, or (c) the acquisition of another Person (other than Borrower or a Subsidiary) by a merger or consolidation or any other combination with such Person.
Adjusted LIBOR Rate shall mean a rate per annum equal to the quotient obtained (rounded upwards, if necessary, to the nearest 1/100th of 1%) by dividing (a) the applicable LIBOR Rate by (b) 1.00 minus the LIBOR Reserve Percentage.
Advantage shall mean any payment (whether made voluntarily or involuntarily, by offset of any deposit or other indebtedness or otherwise) received by any Lender in respect of the Debt, if such payment results in that Lender having less than its pro rata share of the Debt then outstanding, than was the case immediately before such payment.
Affiliate shall mean with respect to any specified Person, any other Person that, directly or indirectly, controls, is controlled by, or is under common control with such specified Person, and control (including the correlative meanings, the terms controlling, controlled by and under common control with) shall mean the possession, directly or indirectly of, the power to direct or cause the direction of the management and policies of such specified Person, whether through the ownership of voting securities, by contract or otherwise.
Agreement shall have the meaning provided in the first paragraph hereof.
Anti-Corruption Laws shall mean all laws, rules, and regulations of any jurisdiction applicable to Borrower or any of its Subsidiaries from time to time concerning or relating to bribery or corruption.
Anti-Terrorism Law shall mean any laws relating to terrorism or money laundering, including Executive Order No. 13224, the USA Patriot Act, the laws comprising or implementing the Bank Secrecy Act, the laws administered by the United States Treasury Departments Office of Foreign Asset Control (as any of the foregoing laws may from time to time be amended, renewed, extended, or replaced) and any other law pertaining to the prevention of future acts of terrorism, in each case as such law may be amended.
Applicable Margin shall mean:
(a) for the period from the Closing Date until the first adjustment date pursuant to clause (b) hereafter, the number of basis points set forth in the applicable matrix below, based upon the result of the computation of the Leverage Ratio set forth in the certificate from an Authorized Officer delivered pursuant to Section 4.02(d); and
(b) commencing with the financial statements for the full fiscal quarter of the Borrower ending after the Closing Date, the number of basis points set forth in the applicable matrix below, based upon the result of the computation of the Leverage Ratio, shall be used to establish the number of basis points that will go into effect;
2
Leverage Ratio |
Five Year Eurodollar Term Loan Margin |
Five Year Base Rate Term Loan Margin |
Three Year Eurodollar Term Loan Margin |
Three Year Base Rate Loan Margin |
Eighteen Month Eurodollar Term Loan Margin |
Eighteen Month Base Rate
Loan | ||||||
Greater than 3.25 to 1.00 |
162.50 basis points |
62.50 basis points | 150.00 basis points | 50.00 basis points | 137.50 basis points | 37.50 basis points | ||||||
Greater than 2.75 to 1.00, but less than or equal to 3.25 to 1.00 |
137.50 basis points |
37.50 basis points | 125.00 basis points | 25.00 basis points | 112.50 basis points | 12.50 basis points | ||||||
Greater than 2.00 to 1.00, but less than or equal to 2.75 to 1.00 |
112.50 basis points |
12.50 basis points | 110.00 basis points | 10.00 basis points | 100.00 basis points | 0.00 basis points | ||||||
Greater than 1.50 to 1.00, but less than or equal to 2.00 to 1.00 |
95.00 basis points |
0.00 basis points | 92.50 basis points |
0.00 basis points | 87.50 basis points | 0.00 basis points | ||||||
Greater than 1.00 to 1.00, but less than or equal to 1.50 to 1.00 |
85.00 basis points |
0.00 basis points | 82.50 basis points |
0.00 basis points | 75.00 basis points | 0.00 basis points | ||||||
Less than or equal to 1.00 to 1.00 |
75.00 basis points |
0.00 basis points | 75.00 basis points |
0.00 basis points | 65.00 basis points | 0.00 basis points |
Changes to the Applicable Margin shall be effective on the first day of the month following the date upon which Agent received, or, if earlier, Agent should have received, pursuant to Section 5.01(a) and (b) and hereof, the financial statements of the Companies. The above matrix does not modify or waive, in any respect, the requirements of Section 5.04 hereof, the rights of Agent and the Lenders to charge the Default Rate, or the rights and remedies of Agent and the Lenders pursuant to Article VII and Article VIII hereof.
April 10, 2015 Credit Agreement shall mean that certain Term Loan Agreement dated as of April 10, 2015 by and among Borrower, PNC Bank, National Association and the other financial institutions party thereto as the same may be amended, modified, restated, supplemented, replaced or refinanced from time to time.
Assignment Agreement shall mean an Assignment and Assumption Agreement in the form of the attached Exhibit F.
Authorized Officer shall mean (i) in the case of Borrower, its chief executive officer, its chief financial officer, its treasurer, or any vice president of Borrower designated as an Authorized Officer of Borrower for the purpose of this Agreement in an Officers Certificate executed by Borrowers chief executive officer or chief financial officer and delivered to the Agent and (ii) in the case of the Agent or any Lender, any vice president, senior vice president or person holding an equivalent or greater title of the Agent or any Lender. Any action taken under this Agreement on behalf of Borrower by any individual who on or after the date of this Agreement shall have been an Authorized Officer of Borrower and whom Agent or any Lender in good faith believes to be an Authorized Officer of Borrower at the time of such action shall be binding on Borrower even though such individual shall have ceased to be an Authorized Officer
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of Borrower, and any action taken under this Agreement on behalf of the Agent or any Lender by any individual who on or after the date of this Agreement shall have been an Authorized Officer of the Agent or such Lender and whom Borrower in good faith believes to be an Authorized Officer of the Agent or such Lender at the time of such action shall be binding on the Agent or such Lender even though such individual shall have ceased to be an Authorized Officer of the Agent or such Lender.
Bail-In Action means the exercise of any Write-Down and Conversion Powers by the applicable EEA Resolution Authority in respect of any liability of an EEA Financial Institution.
Bail-In Legislation means, with respect to any EEA Member Country implementing Article 55 of Directive 2014/59/EU of the European Parliament and of the Council of the European Union, the implementing law for such EEA Member Country from time to time which is described in the EU Bail-In Legislation Schedule.
Base Rate shall mean, for any day, a fluctuating per annum rate of interest equal to the highest of (a) the Federal Funds Open Rate, plus 0.5%, (b) the Prime Rate, and (c) the Daily LIBOR Rate, plus 100 basis points (1.0%). Any change in the Base Rate (or any component thereof) shall take effect at the opening of business on the day such change occurs.
Base Rate Loan shall mean any Five Year Base Rate Term Loan, Three Year Base Rate Term Loan or Eighteen Month Base Rate Term Loan.
Borrower shall have the meaning set forth in the first paragraph of this Agreement.
Business Day shall mean a day of the year on which banks are not required or authorized to close in Cleveland, Ohio, and, if the applicable Business Day relates to any Eurodollar Loan, on which dealings are carried on in the London interbank eurodollar market.
Capital Distribution shall mean a payment made, liability incurred or other consideration given for the purchase, acquisition, redemption or retirement of any capital stock or other equity interest of Borrower or any Subsidiary or as a dividend, return of capital or other distribution (other than any stock dividend, stock split or other equity distribution payable only in capital stock or other equity of Borrower or any Subsidiary of Borrower in respect of Borrowers or any Subsidiarys capital stock or other equity interest, including, but not limited to, any Share Repurchase.
Cash Equivalent shall mean any debt instrument that would be deemed a cash equivalent in accordance with GAAP.
CEA shall mean the Commodity Exchange Act (7 U.S.C. §1 et seq.), as amended from time to time, and any successor statute.
CFTC shall mean the Commodity Futures Trading Commission.
Change in Law shall mean the occurrence, after the date of this Agreement, of any of the following: (a) the adoption or taking effect of any law, rule, regulation or treaty, (b) any change in any law, rule, regulation or treaty or in the administration, interpretation, implementation or application thereof by any Governmental Authority or (c) the making or issuance of any request, rule, guideline or directive (whether or not having the force of law) by
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any Governmental Authority; provided that notwithstanding anything herein to the contrary, (x) the Dodd-Frank Wall Street Reform and Consumer Protection Act and all requests, rules, guidelines or directives thereunder or issued in connection therewith and (y) all requests, rules, guidelines or directives promulgated by the Bank for International Settlements, the Basel Committee on Banking Supervision (or any successor or similar authority) or the United States or foreign regulatory authorities, in each case pursuant to Basel III, shall in each case be deemed to be a Change in Law, that is enacted, adopted or issued after the date hereof.
Change of Control shall mean (a) the acquisition of, or, if earlier, the shareholder or director approval of the acquisition of, ownership or voting control, directly or indirectly, beneficially or of record, on or after the Effective Date, by any Person or group (within the meaning of Rule 13d-3 of the Exchange Act) other than the Current Management Team, of shares representing more than fifty percent (50%) of the aggregate ordinary Voting Power represented by the issued and outstanding capital stock of Borrower; (b) the occupation of a majority of the seats (other than vacant seats) on the board of directors of Borrower by persons who were neither (i) nominated by the board of directors of Borrower nor (ii) appointed by directors so nominated; or (c) the occurrence of a change of control, or other similar provision, as defined in any Material Indebtedness Agreement.
CIP Regulations shall have the meaning provided in Section 9.11 hereof.
Closing Date shall mean the date upon which all of the conditions set forth in Section 4.02 of this Agreement have been satisfied; provided that (a) such date shall occur on or prior to June 30, 2017 and (b) such date shall be a Business Day.
Closing Date Acquisition shall mean the acquisition by the Borrower of the Closing Date Target in accordance with the terms of the Closing Date Acquisition Agreement and the other Closing Date Acquisition Documents.
Closing Date Acquisition Agreement shall mean that certain Agreement and Plan of Merger, by and among Borrower, Viking Merger Corp., a Delaware corporation, VMHI Rep Services, LLC, a Delaware limited liability company, and the Closing Date Target dated as of February 20, 2017 (together with all schedules, exhibits and annexes thereto), as the same may be supplemented or amended from time to time in accordance herewith.
Closing Date Acquisition Documents shall mean the Closing Date Acquisition Agreement and all other instruments, certificates or documents delivered or contemplated to be delivered thereunder or in connection therewith, as the same may be supplemented or amended from time to time in accordance herewith.
Closing Date Target shall mean Vention Medical Holdings, Inc., a Delaware corporation.
Co-Documentation Agents shall mean HSBC Bank USA, N.A. and U.S. Bank National Association.
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Co-Syndication Agents shall mean Bank of America, N.A., JPMorgan Chase Bank, National Association, Wells Fargo Bank, National Association, Branch Banking and Trust Company and KeyBank National Association.
Code shall mean the Internal Revenue Code of 1986, as amended, together with the rules and regulations promulgated thereunder.
Commitment shall mean the obligation hereunder, of each Lender to participate in the making of Loans on the Closing Date up to the aggregate amount of each such Lenders Five Year Term Loan Commitment, Three Year Term Loan Commitment and Eighteen Month Term Loan Commitment.
Commitment Percentage shall mean, at any time for any Lender, a percentage obtained by dividing such Lenders Commitment by the Total Commitment Amount. The Commitment Percentage for each Lender as of the Effective Date is set forth opposite such Lenders name under the column headed Commitment Percentage as described in Schedule 1 hereto (which Schedule 1 shall be amended on or immediately prior to the Closing Date to set forth each Lenders Commitment Percentage as of the Closing Date).
Company shall mean Borrower or a Subsidiary. Companies shall mean Borrower and all its Subsidiaries.
Compliance Certificate shall mean a certificate, substantially in the form of the attached Exhibit E.
Connection Income Taxes shall mean Other Connection Taxes that are imposed on or measured by net income (however denominated) or that are franchise Taxes or branch profits Taxes.
Consideration shall mean, in connection with an Acquisition, the aggregate consideration paid, including borrowed funds, cash, the issuance of securities or notes, the assumption or incurring of liabilities (direct or contingent), the payment, in excess of fair and reasonable amounts, of consulting fees or fees for a covenant not to compete and any other consideration paid for the purchase.
Consolidated shall mean the resultant consolidation of the financial statements of Borrower and its Subsidiaries in accordance with GAAP, including principles of consolidation consistent with those applied in preparation of the consolidated financial statements referred to in Section 5.01(a) and (b) hereof.
Consolidated Depreciation and Amortization Charges shall mean, for any period, the aggregate of all depreciation and amortization charges for fixed assets, leasehold improvements and general intangibles (specifically including goodwill) as well as impairments thereof and any losses traced to the write-off of goodwill, fixed assets, leasehold improvements and general intangibles associated with the disposal or exiting of a business of Borrower or any of its Subsidiaries for such period, all as determined on a Consolidated basis and in accordance with GAAP.
Consolidated EBIT shall mean, for any period, on a Consolidated basis and in accordance with GAAP, Consolidated Net Earnings for such period plus the aggregate amounts
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deducted in determining such Consolidated Net Earnings in respect of (a) income taxes, (b) Consolidated Interest Expense, and (c) any non-cash charges.
Consolidated EBITDA shall mean, for any period, Consolidated EBIT plus Consolidated Depreciation and Amortization Charges.
Consolidated Interest Expense shall mean, for any period, the interest expense of Borrower for such period, as determined on a Consolidated basis and in accordance with GAAP, and shall include that portion of the expenses of a Permitted Receivables Facility that would be the equivalent to interest expense if Borrower obtained funding in a manner that would give rise to interest expense, in an amount approximately equal to the amount of the Permitted Receivables Facility.
Consolidated Net Earnings shall mean, for any period, the net income (loss) of Borrower for such period, as determined on a Consolidated basis and in accordance with GAAP.
Consolidated Total Assets shall mean the book value of all assets of Borrower and its Subsidiaries, as determined on a Consolidated basis and in accordance with GAAP, based upon the financial statements of Borrower for the most recently completed fiscal quarter.
Consolidated Trailing EBITDA shall mean the sum of (a) Consolidated EBITDA, plus (b)(i) without duplication, the EBITDA of Subsidiaries acquired by Borrower and its Subsidiaries during the most recently completed four (4) fiscal quarters to the extent that such EBITDA of Subsidiaries acquired is confirmed by audited financial or other information (which other information need not be audited or auditable) satisfactory to the Agent minus (ii) the EBITDA of Subsidiaries disposed of by Borrower and its Subsidiaries during the most recently completed four (4) fiscal quarters.
Consolidated Trailing Interest Expense shall mean the sum of (a) Consolidated Interest Expense, plus (b)(i) without duplication, the interest expense of Subsidiaries acquired by Borrower and its Subsidiaries during the most recently completed four (4) fiscal quarters to the extent that such interest expense of such Subsidiaries acquired is confirmed by audited financial or other information (which other information need not be audited or auditable) satisfactory to the Agent, minus (ii) the interest expense of Subsidiaries disposed of by Borrower and its Subsidiaries during the most recently completed four (4) fiscal quarters.
Controlled Group shall mean Borrower and each Person required to be aggregated with Borrower under Code Sections 414(b), (c), (m) or (o).
Covered Entity shall mean Borrower, its Affiliates and Subsidiaries, all Guarantors of Payment, any pledgors of collateral, all owners of the foregoing, and all brokers or other agents of Borrower acting in any capacity in connection with the Loans.
Current Management Team shall mean any group comprised of the chief executive officer, the chief operating officer, the chief financial officer and other senior management of Borrower (or any combination thereof) as in place on the Effective Date, and their respective spouses and children (and/or trusts of which the only beneficiaries are such members of senior management and their respective spouses and children) or any group (within the meaning of Rule 13d under the Exchange Act) that includes at least three (3) of such members of senior
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management, together with their affiliates and associates (within the meaning of Rule 12b-2 under the Exchange Act).
Daily LIBOR Rate shall mean, for any day, the rate per annum determined by the Agent by dividing (x) the Published Rate by (y) a number equal to 1.00 minus the LIBOR Reserve Percentage on such day. Notwithstanding the foregoing, if the Daily LIBOR Rate as determined above would be less than zero, such rate shall be deemed to be zero.
Debt shall mean, collectively, all Indebtedness incurred by Borrower to Agent and the Lenders pursuant to this Agreement and the other Loan Documents and includes the principal amount of and interest (including any interest accruing during the pendency of any bankruptcy, insolvency, receivership or other similar proceeding, regardless of whether allowed or allocable in such proceeding) on all Loans and each extension, renewal or refinancing thereof in whole or in part, the facility fees, other fees and any prepayment fees and other amounts payable hereunder or thereunder.
Debtor Relief Laws shall mean the Bankruptcy Code of the United States of America, and all other liquidation, conservatorship, bankruptcy, assignment for the benefit of creditors, moratorium, rearrangement, receivership, insolvency, reorganization, or similar debtor relief laws of the United States or other applicable jurisdictions from time to time in effect.
Default shall mean any of the events specified in Article VII, whether or not any requirement for such event to become an Event of Default has been satisfied.
Default Rate shall mean, with respect to any Loan, a rate per annum equal to two percent (2%) in excess of the rate otherwise applicable thereto, and, with respect to any other amount, if no rate is specified or available, then two percent (2%) in excess of the Base Rate.
Defaulting Lender shall mean any Lender, subject to Section 2.07(b), that (a) has failed, within two Business Days of the date required to be funded or paid, to pay over to the Agent or any Lender any other amount required to be paid by it hereunder, (b) has become the subject of a Bankruptcy Event or a Bail-In Action or (c) has failed at any time to comply with the provisions of Section 8.04.
As used in this definition, the term Bankruptcy Event means, with respect to any Person, such Person or such Persons direct or indirect parent company becoming the subject of a bankruptcy or insolvency proceeding, or having had a receiver, conservator, trustee, administrator, custodian, assignee for the benefit of creditors or similar Person charged with the reorganization or liquidation of its business appointed for it, or, in the good faith determination of the Agent, has taken any action in furtherance of, or indicating its consent to, approval of, or acquiescence in, any such proceeding or appointment, provided that a Bankruptcy Event shall not result solely by virtue of any ownership interest, or the acquisition of any ownership interest, in such Person or such Persons direct or indirect parent company by a Governmental Authority or instrumentality thereof if, and only if, such ownership interest does not result in or provide such Person with immunity from the jurisdiction of courts within the United States or from the enforcement of judgments or writs of attachment on its assets or permit such Person (or such Governmental Authority or instrumentality) to reject, repudiate, disavow or disaffirm any contracts or agreements made with such Lender. Any reasonable determination by the Agent that a Lender is a Defaulting Lender under any one or more of clauses (a) through (c) above shall be conclusive and binding absent manifest error, and such Lender shall be deemed to be a
8
Defaulting Lender upon delivery of written notice of such determination to Borrower and each such Person.
Depreciation and Amortization Charges shall mean, with respect to any Person for any period, in accordance with GAAP, the aggregate of all such charges for fixed assets, leasehold improvements and general intangibles (specifically including goodwill) of such Person as well as impairments thereof and any losses traced to the write-off of goodwill, fixed assets, leasehold improvements and general intangibles associated with the disposal or exiting of a business by such Person for such period.
Derived Eurodollar Rate shall mean with respect to a Eurodollar Loan, a rate per annum equal to the sum of the Applicable Margin (from time to time in effect) plus the Adjusted LIBOR Rate.
Dollar and the sign $ shall mean lawful money of the United States of America.
Dollar Equivalent shall mean, with respect to any amount of any currency, as of any date of computation, the equivalent amount of such currency expressed in Dollars.
EBITDA shall mean for any period, all Net Earnings in accordance with GAAP for such period, plus the aggregate amounts deducted in determining such Net Earnings in respect of (a) income taxes, (b) interest expense, and (c) Depreciation and Amortization Charges, in accordance with GAAP.
EEA Financial Institution means (a) any credit institution or investment firm established in any EEA Member Country which is subject to the supervision of an EEA Resolution Authority, (b) any entity established in an EEA Member Country which is a parent of an institution described in clause (a) of this definition, or (c) any financial institution established in an EEA Member Country which is a Subsidiary of an institution described in clauses (a) or (b) of this definition and is subject to consolidated supervision with its parent.
EEA Member Country means any of the member states of the European Union, Iceland, Liechtenstein, and Norway.
EEA Resolution Authority means any public administrative authority or any person entrusted with public administrative authority of any EEA Member Country (including any delegee) having responsibility for the resolution of any EEA Financial Institution.
Effective Date shall mean the date upon which all of the conditions set forth in Section 4.01 of this Agreement have been satisfied, which date is February 21, 2017.
Eighteen Month Base Rate Term Loan shall mean an Eighteen Month Term Loan described in Section 2.01(c) hereof on which Borrower shall pay interest at a rate per annum equal to the sum of the Applicable Margin (from time to time in effect) plus the Base Rate.
Eighteen Month Eurodollar Term Loan shall mean an Eighteen Month Term Loan described in Section 2.01(c) hereof on which Borrower shall pay interest at a rate based upon the LIBOR Rate.
Eighteen Month Term Loan shall mean a loan made by the Eighteen Month Term Loan Lenders to Borrower pursuant to Section 2.01(c) hereof.
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Eighteen Month Term Loan Commitment shall mean the obligation hereunder of each Lender making an Eighteen Month Term Loan equal to the amount set forth opposite such Lenders name under the column headed Eighteen Month Term Loan Commitment Amount as set forth on Schedule 1 hereto.
Eighteen Month Term Loan Commitment Amount shall mean the principal amount of Two Hundred Million Dollars ($200,000,000).
Eighteen Month Term Loan Lender shall mean a Lender with an Eighteen Month Term Loan Commitment.
Eighteen Month Term Loan Maturity Date shall mean the date that is eighteen months after the Closing Date.
Eighteen Month Term Loan Note shall mean any note delivered pursuant to Section 2.01(c) of this Agreement.
Eligible Assignee shall have the meaning given to such term in Section 10.10(a).
Environmental Laws shall mean all provisions of law, statutes, ordinances, rules, regulations, permits, licenses, judgments, writs, injunctions, decrees, orders, awards and standards promulgated by the government of the United States of America or any other applicable country or sovereignty or by any state or municipality thereof or by any court, agency, instrumentality, regulatory authority or commission of any of the foregoing concerning health, safety and protection of, or regulation of the discharge of substances into, the environment.
ERISA shall mean the Employee Retirement Income Security Act of 1974, as amended from time to time, and the regulations promulgated pursuant thereto.
ERISA Affiliate shall mean any corporation which is a member of the same controlled group of corporations as Borrower within the meaning of section 414(b) of the Code, or any trade or business which is under common control with Borrower within the meaning of section 414(c) of the Code.
ERISA Event shall mean (a) the existence of a condition or event with respect to an ERISA Plan that presents a risk of the imposition of an excise tax or any other liability on Borrower or of the imposition of a Lien on the assets of Borrower or its Subsidiaries; (b) the engagement by a Controlled Group member in a non-exempt prohibited transaction (as defined under ERISA Section 406 or Code Section 4975) or a breach of a fiduciary duty under ERISA that could result in liability to Borrower; (c) the application by a Controlled Group member for a waiver from the minimum funding requirements of Code Section 412 or ERISA Section 302 or a Controlled Group member is required to provide security under Code Section 401(a)(29) or ERISA Section 307; (d) the occurrence of a Reportable Event with respect to any Pension Plan as to which notice is required to be provided to the PBGC; (e) the withdrawal by a Controlled Group member from a Multiemployer Plan in a complete withdrawal or a partial withdrawal (as such terms are defined in ERISA Sections 4203 and 4205, respectively); (f) the involvement of, or occurrence or existence of any event or condition that makes likely the involvement of, a Multiemployer Plan in any reorganization under ERISA Section 4241; (g) the failure of an ERISA Plan (and any related trust) that is intended to be qualified under Code Sections 401 and 501 to be so qualified or the failure of any cash or deferred arrangement under any such
10
ERISA Plan to meet the requirements of Code Section 401(k); (h) the taking by the PBGC of any steps to terminate a Pension Plan or appoint a trustee to administer a Pension Plan, or the taking by a Controlled Group member of any steps to terminate a Pension Plan; (i) the failure by a Controlled Group member or an ERISA Plan to satisfy any requirements of law applicable to an ERISA Plan; (j) the commencement, existence or threatening of a claim, action, suit, audit or investigation with respect to an ERISA Plan, other than a routine claim for benefits; or (k) any incurrence by or any expectation of the incurrence by a Controlled Group member of any liability for post-retirement benefits under any Welfare Plan, other than as required by ERISA Section 601, et. seq. or Code Section 4980B, that, as to (a) through (k) above, would reasonably be likely to have or result in a Material Adverse Effect.
ERISA Plan shall mean an employee benefit plan (within the meaning of ERISA Section 3(3)) that a Controlled Group member at any time sponsors, maintains, contributes to, has liability with respect to or has an obligation to contribute to such plan.
EU Bail-In Legislation Schedule means the EU Bail-In Legislation Schedule published by the Loan Market Association (or any successor person), as in effect from time to time.
Eurodollar Loan shall mean any Five Year Eurodollar Term Loan, Three Year Eurodollar Term Loan or Eighteen Month Eurodollar Term Loan.
Event of Default shall mean any of the events specified in Article VII, provided that there has been satisfied any requirement in connection with such event for the giving of notice, or the lapse of time, or the happening of any further condition, event or act.
Exchange Act shall mean the Securities Exchange Act of 1934, as amended.
Excluded Taxes shall mean any of the following Taxes imposed on or with respect to a Recipient or required to be withheld or deducted from a payment to a Recipient, (a) Taxes imposed on or measured by net income (however denominated), franchise Taxes, and branch profits Taxes, in each case, (i) imposed as a result of such Recipient being organized under the laws of, or having its principal office or, in the case of any Lender, its applicable lending office located in, the jurisdiction imposing such Tax (or any political subdivision thereof) or (ii) that are Other Connection Taxes, (b) in the case of a Lender, U.S. federal withholding Taxes imposed on amounts payable to or for the account of such Lender with respect to an applicable interest in a Loan or Commitment pursuant to a law in effect on the date on which (i) such Lender acquires such interest in the Loan or Commitment (other than pursuant to an assignment request by Borrower under Section 3.09) or (ii) such Lender changes its lending office, except in each case to the extent that, pursuant to Section 3.02 amounts with respect to such Taxes were payable either to such Lenders assignor immediately before such Lender became a party hereto or to such Lender immediately before it changed its lending office, (c) Taxes attributable to such Recipients failure to comply with Section 3.02(f) and (d) any U.S. federal withholding Taxes imposed under FATCA.
Existing Credit Agreements shall mean, collectively, the February 20, 2015 Credit Agreement, the April 10, 2015 Credit Agreement and the Nordson Holdings S.a.r.l-BAML Credit Agreement.
Existing Closing Date Target Indebtedness means all existing Indebtedness of the Closing Date Target.
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Exposure shall mean, at any time, the sum of the aggregate principal Dollar amount of all Loans outstanding.
FATCA shall mean Sections 1471 through 1474 of the Code, as of the date of this Agreement (or any amended or successor version that is substantively comparable and not materially more onerous to comply with) and any current or future regulations or official interpretations thereof.
February 20, 2015 Credit Agreement shall mean that certain Second Amended and Restated Credit Agreement dated as of February 20, 2015 by and among Borrower, KeyBank National Association and the other financial institutions party thereto as the same may be amended, modified, restated, supplemented, replaced or refinanced from time to time.
Federal Funds Effective Rate for any day shall mean the rate per annum (based on a year of 360 days and actual days elapsed and rounded upward to the nearest 1/100 of 1%) announced by the Federal Reserve Bank of New York (or any successor) on such day as being the weighted average of the rates on overnight federal funds transactions arranged by federal funds brokers on the previous trading day, as computed and announced by such Federal Reserve Bank (or any successor) in substantially the same manner as such Federal Reserve Bank computes and announces the weighted average it refers to as the Federal Funds Effective Rate as of the Closing Date; provided, if such Federal Reserve Bank (or its successor) does not announce such rate on any day, the Federal Funds Effective Rate for such day shall be the Federal Funds Effective Rate for the last day on which such rate was announced.
Federal Funds Open Rate for any day shall mean the rate per annum (based on a year of 360 days and actual days elapsed) which is the daily federal funds open rate as quoted by ICAP North America, Inc. (or any successor) as set forth on the Bloomberg Screen BTMM for that day opposite the caption OPEN (or on such other substitute Bloomberg Screen that displays such rate), or as set forth on such other recognized electronic source used for the purpose of displaying such rate as selected by the Agent (for purposes of this definition, an Alternate Source) (or if such rate for such day does not appear on the Bloomberg Screen BTMM (or any substitute screen) or on any Alternate Source, or if there shall at any time, for any reason, no longer exist a Bloomberg Screen BTMM (or any substitute screen) or any Alternate Source, a comparable replacement rate determined by the Agent at such time (which determination shall be conclusive absent manifest error); provided however, that if such day is not a Business Day, the Federal Funds Open Rate for such day shall be the open rate on the immediately preceding Business Day. If and when the Federal Funds Open Rate changes, the rate of interest applicable to Base Rate Loans will change automatically without notice to Borrower, effective on the date of any such change.
Fee Letter means that certain amended and restated fee letter agreement dated as of February 13, 2017 by and among Borrower, PNC Capital Markets and Agent.
Financial Officer shall mean any of the following officers: chief executive officer, president, vice president-finance, chief financial officer, controller or treasurer. Unless otherwise qualified, all references to a Financial Officer in this Agreement shall refer to a Financial Officer of Borrower.
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Five Year Base Rate Term Loan shall mean a Five Year Term Loan described in Section 2.01(a) hereof on which Borrower shall pay interest at a rate per annum equal to the sum of the Applicable Margin (from time to time in effect) plus the Base Rate.
Five Year Eurodollar Term Loan shall mean a Five Year Term Loan described in Section 2.01(a) hereof on which Borrower shall pay interest at a rate based upon the LIBOR Rate.
Five Year Term Loan shall mean a loan made by the Five Year Term Loan Lenders to Borrower pursuant to Section 2.01(a) hereof.
Five Year Term Loan Commitment shall mean the obligation hereunder of each Lender making a Five Year Term Loan equal to the amount set forth opposite such Lenders name under the column headed Five Year Term Loan Commitment Amount as set forth on Schedule 1 hereto.
Five Year Term Loan Commitment Amount shall mean the principal amount of Three Hundred Five Million Dollars ($305,000,000).
Five Year Term Loan Lender shall mean a Lender with a Five Year Term Loan Commitment.
Five Year Term Loan Maturity Date shall mean the date that is five years after the Closing Date.
Five Year Term Loan Note shall mean any note delivered pursuant to Section 2.01(a) of this Agreement.
Foreign Lender shall mean a Lender that is not a U.S. Person.
GAAP shall have the meaning given to such term in Section 1.02.
Governmental Authority shall mean the government of the United States of America or any other nation, or of any political subdivision thereof, whether state or local, and any agency, authority, instrumentality, regulatory body, court, central bank or other entity exercising executive, legislative, judicial, taxing, regulatory or administrative powers or functions of or pertaining to government (including any supra-national bodies such as the European Union or the European Central Bank).
Guarantor shall mean a Person that pledges its credit or property in any manner for the payment or other performance of the indebtedness, contract or other obligation of another and includes (without limitation) any guarantor (whether of payment or of collection), surety, co-maker or co-borrower, endorser or Person that agrees conditionally or otherwise to make any purchase, loan or investment in order thereby to enable another to prevent or correct a default of any kind.
Guarantor of Payment shall mean any Subsidiary that executes and delivers a Guaranty of Payment on or after the Effective Date in accordance with the provisions of Section 5.15 or any other Person that shall deliver a Guaranty of Payment to the Agent or any Lender on or after the Effective Date.
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Guaranty Obligations shall mean as to any Person (without duplication) any obligation of such Person guaranteeing any Indebtedness (primary Indebtedness) 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: (i) to purchase any such primary Indebtedness or any property constituting direct or indirect security therefore; (ii) to advance or supply funds for the purchase or payment of any such primary Indebtedness or to maintain working capital or equity capital of the primary obligor or otherwise to maintain the net worth or solvency of the primary obligor; (iii) to purchase property, securities or services primarily for the purpose of assuring the owner of any such primary Indebtedness of the ability of the primary obligor to make payment of such primary Indebtedness; or (iv) otherwise to assure or hold harmless the owner of such primary Indebtedness against loss in respect thereof, provided, however, that the definition of Guaranty Obligation shall not include endorsements of instruments for deposit or collection in the ordinary course of business. The amount of any Guaranty Obligation shall be deemed to be an amount equal to the then stated or determinable amount of the primary Indebtedness in respect of which such Guaranty Obligation is made or, if not stated or determinable, the then maximum reasonably anticipated liability in respect thereof (assuming such Person is required to perform thereunder).
Guaranty of Payment shall mean a guaranty substantially similar to Exhibit G attached hereto modified to the reasonable satisfaction of the Agent to reflect the nature of it as a subsidiary guaranty.
including shall mean, unless the context clearly requires otherwise, including without limitation, whether or not so stated.
Indebtedness shall mean, for Borrower or any Subsidiary (excluding in all cases trade payables payable in the ordinary course of business by Borrower or such Subsidiary), without duplication, (a) all obligations to repay borrowed money, direct or indirect, incurred, assumed, or guaranteed, (b) all obligations for the deferred purchase price of capital assets, in each case, incurred outside of the ordinary course of business, (c) all obligations under conditional sales or other title retention agreements (other than a true consignment), in each case, incurred outside of the ordinary course of business, (d) all current obligations (contingent or otherwise) under any letter of credit or bankers acceptance (other than commercial, trade or other letters of credit entered into in connection with customer or supplier relationships in the ordinary course business), (e) all synthetic leases, (f), all obligations of Borrower or such Subsidiary with respect to the repurchase of assets under asset securitization financing programs, including but not limited to, the Permitted Receivables Facility, (g) all material obligations arising outside the ordinary course of business to advance funds to, or to purchase assets, property or services from, any other Person in order to maintain the financial condition of such Person, and (h) all Guaranty Obligations.
Indemnified Taxes shall mean (a) Taxes, other than Excluded Taxes, imposed on or with respect to any payment made by or on account of any obligation of any Loan Party under any Loan Document and (b) to the extent not otherwise described in (a), Other Taxes.
Interest Adjustment Date shall mean the last day of each Interest Period.
Interest Coverage Ratio shall mean, for the most recently completed four (4) fiscal quarters of Borrower, on a Consolidated basis and in accordance with GAAP, the ratio of (a) Consolidated Trailing EBITDA to (b) Consolidated Trailing Interest Expense, as determined as
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of the conclusion of most recently completed fiscal quarter in accordance with Borrowers customary financial reporting practices.
Interest Period shall mean, with respect to a Eurodollar Loan, a period of one (1) week or one (1), two (2), three (3) or six (6) months, as selected by Borrower in accordance with Section 2.02 hereof, commencing on the applicable date of borrowing or conversion of such Eurodollar Loan and on each Interest Adjustment Date with respect thereto; provided, however, that if any such period would be affected by a prepayment or conversion rights or obligations as provided in Section 2.02, 2.04 or Section 3.05 hereof, or maturity of Eurodollar Loans as provided in Section 2.01 hereof, Borrower shall not select a period that extends beyond the date of such prepayment, conversion or maturity; if Borrower fails to select a new Interest Period with respect to an outstanding Eurodollar Loan at least three (3) Business Days prior to the Interest Adjustment Date applicable to such Eurodollar Loan, Borrower shall be deemed to have converted such Eurodollar Loan to a Base Rate Loan at the end of the then current Interest Period.
Joint Lead Arrangers shall, collectively, mean PNC Capital Markets, Merrill Lynch, Pierce, Fenner & Smith Incorporated, JPMorgan Chase Bank, National Association, Wells Fargo Securities, LLC, BB&T Capital Markets and KeyBanc Capital Markets Inc. in their capacities as joint lead arrangers and joint bookrunners.
Lender and Lenders has the meaning set forth in the first paragraph of this Agreement.
Leverage Ratio Step-Up Period means the fiscal quarter in which a Material Acquisition Event occurs and the next following three consecutive fiscal quarter periods of Borrower.
Leverage Ratio shall mean, at any time, for the most recently completed four (4) fiscal quarters of Borrower, on a Consolidated basis and in accordance with GAAP, the ratio of (a)(i) Total Indebtedness minus (ii) the aggregate amount of cash, Cash Equivalents and other marketable securities of Borrower and its Subsidiaries that are not subject to a Lien (other than a Lien in favor of the Agent for the benefit of the Lenders) as set forth on the financial statements of Borrower and its Subsidiaries for the most recently completed fiscal quarter to (b) Consolidated Trailing EBITDA, all as determined as of the conclusion of most recently completed fiscal quarter in accordance with Borrowers customary financial reporting practices.
LIBOR Rate shall mean, with respect to a Eurodollar Loan, for any Interest Period, the per annum rate of interest, determined by Agent in accordance with its usual procedures (which determination shall be conclusive absent manifest error) as of approximately 11:00 A.M. (London time) two (2) Business Days prior to the beginning of such Interest Period pertaining to such Eurodollar Loan, as provided by Reuters (or, if for any reason such rate is unavailable from Reuters, from any other similar company or service that provides rate quotations comparable to those currently provided by Reuters) as the rate in the London interbank market for Dollar deposits in immediately available funds with a maturity comparable to such Interest Period. In the event that such rate quotation is not available for any reason, then the rate for purposes of this subpart (a) shall be the average (rounded upward to the nearest 1/16th of 1%) of the per annum rates at which deposits in immediately available funds in Dollars for the relevant Interest Period and in the amount of the Eurodollar Loan to be disbursed or to remain outstanding during such Interest Period, as the case may be, are offered to Agent (or an Affiliate of Agent, in Agents
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discretion) by prime banks in any Eurodollar market reasonably selected by Agent, determined as of 11:00 A.M. (London time) (or as soon thereafter as practicable), two (2) Business Days prior to the beginning of the relevant Interest Period pertaining to such Eurodollar Loan hereunder; provided, that, if such rate is below zero, LIBOR Rate will be deemed to be zero for purposes of this Agreement.
LIBOR Reserve Percentage shall mean as of any day the maximum percentage in effect on such day, as prescribed by the Board of Governors of the Federal Reserve System (or any successor) for determining the reserve requirements (including supplemental, marginal and emergency reserve requirements) with respect to eurocurrency funding (currently referred to as Eurocurrency Liabilities).
Lien shall mean any mortgage, security interest, lien (statutory or other), charge, encumbrance on, pledge or deposit of, or conditional sale, leasing, sale with a right of redemption or other title retention agreement and any capitalized lease with respect to any (real or personal) or asset.
Loan shall mean any Five Year Term Loan, Three Year Term Loan or Eighteen Month Term Loan.
Loan Documents shall mean, collectively, this Agreement, each Note, each Guaranty of Payment, the Fee Letter and any other documents relating to any of the foregoing, as any of the foregoing may from time to time be amended, restated or otherwise modified or replaced.
Loan Party shall mean Borrower and each Guarantor.
Material Acquisition Event means any time when (a) any Company consummates an Acquisition, the Consideration for which is greater than or equal to One Hundred Million Dollars ($100,000,000), or (b) any Company or the Companies consummate one or more Acquisitions over a period of no more than ninety (90) days, the aggregate Consideration for which is greater than or equal to One Hundred Million Dollars ($100,000,000). It being understood that the Closing Date Acquisition shall constitute a Material Acquisition Event.
Material Adverse Effect shall mean a material adverse effect on (a) the business, operations, property or condition (financial or otherwise) of Borrower and its Subsidiaries taken as a whole, or (b) the validity or enforceability of this Agreement or any of the other Loan Documents or the rights and remedies of the Agent of the Lenders hereunder or thereunder.
Material Indebtedness Agreement shall mean any debt instrument, lease (capital, operating or otherwise), guaranty, contract, commitment, agreement or other arrangement evidencing any Indebtedness of Borrower or any Subsidiary in an amount equal to or greater than the greater of (i) Fifty Million Dollars ($50,000,000) and (ii) an amount equal to five percent (5%) of Consolidated Total Assets.
Multiemployer Plan shall mean a Pension Plan that is subject to the requirements of Subtitle E of Title IV of ERISA.
Net Earnings shall mean, for any period, the net income (loss) for such period, determined in accordance with GAAP.
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Non-Consenting Lender shall mean any Lender that does not approve any consent, waiver or amendment that (i) requires the approval of all affected Lenders in accordance with the terms of Section 10.03 and (ii) has been approved by the Required Lenders.
Non-Defaulting Lender shall mean, at any time, each Lender that is not a Defaulting Lender at such time.
Nordson Holdings S.a.r.l.- BAML Credit Agreement shall mean that certain Credit Agreement dated as of October 5, 2015, by and among Nordson Holdings S.a.r.l. & Co. KG, as borrower, Nordson Corporation, as parent guarantor, the banks party thereto, and Bank of America Merrill Lynch International, as administrative agent as the same may be amended, modified, restated, supplemented, replaced or refinanced from time to time.
Note shall mean any Five Year Term Loan Note, Three Year Term Loan Note or Eighteen Month Term Loan Note.
Note Purchase Agreements shall mean, collectively, the 2016 NYLIM Note Purchase Agreement, the 2012 Senior Note Purchase Agreement and the 2015 Note Purchase Agreement.
Notice of Loan shall mean a Notice of Loan in the form of the attached Exhibit D.
Obligor shall mean (a) a Person whose credit or any of whose property is pledged to the payment of the Debt and includes, without limitation, any Guarantor, and (b) any signatory to a Related Writing.
Organizational Documents shall mean, with respect to any Person (other than an individual), such Persons Articles (Certificate) of Incorporation, or equivalent formation documents, and Regulations (Bylaws), or equivalent governing documents, and any amendments to any of the foregoing.
Other Connection Taxes shall mean, with respect to any Recipient, Taxes imposed as a result of a present or former connection between such Recipient and the jurisdiction imposing such Tax (other than connections arising from such Recipient having executed, delivered, become a party to, performed its obligations under, received payments under, received or perfected a security interest under, engaged in any other transaction pursuant to or enforced any Loan Document, or sold or assigned an interest in any Loan or Loan Document).
Other Taxes shall mean all present or future stamp, court or documentary, intangible, recording, filing or similar Taxes that arise from any payment made under, from the execution, delivery, performance, enforcement or registration of, from the receipt or perfection of a security interest under, or otherwise with respect to, any Loan Document, except any such Taxes that are Other Connection Taxes imposed with respect to an assignment (other than an assignment made pursuant to Section 3.09).
Participant shall have the meaning provided to such term in Section 10.11(a).
Participant Register shall have the meaning specified in Section 10.11(c).
PBGC shall mean the Pension Benefit Guaranty Corporation, or any successor or replacement entity thereto under ERISA.
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Pension Plan shall mean an ERISA Plan that is a pension plan (within the meaning of ERISA Section 3(2)).
Permitted Receivables Facility shall mean an accounts receivable facility whereby Borrower or its Subsidiaries sell or transfer the accounts receivables of Borrower or its Subsidiaries to the Receivables Subsidiary which in turn transfers to a buyer, purchaser or lender undivided fractional interests in such accounts receivable, so long as (a) no portion of the Indebtedness or any other obligation (contingent or otherwise) under such Permitted Receivables Facility is guaranteed by Borrower or any Subsidiary, (b) there is no recourse or obligation to Borrower or any Subsidiary (other than the Receivables Subsidiary) whatsoever other than pursuant to customary representations, warranties, covenants and indemnities entered into in the ordinary course of business in connection with such Permitted Receivables Facility, and (c) neither Borrower nor any Subsidiary (other than the Receivables Subsidiary) provides, either directly or indirectly, any other credit support of any kind (excluding credit insurance or similar third party credit support obtained in the ordinary course of business) in connection with such Permitted Receivables Facility other than as set forth in subpart (b) of this definition.
Person shall mean any individual, sole proprietorship, partnership, joint venture, unincorporated organization, corporation, limited liability company, institution, trust, estate, government or other agency or political subdivision thereof or any other entity.
Plan shall mean any employee pension benefit plan (as such term is defined in section 3 of ERISA) which is or has been established or maintained, or to which contributions are or have been made, by Borrower or any ERISA Affiliate.
PNC Capital Markets shall mean PNC Capital Markets LLC.
Prime Rate shall mean the interest rate established from time to time by Agent as Agents prime rate, whether or not such rate is publicly announced; the Prime Rate may not be the lowest interest rate charged by Agent for commercial or other extensions of credit. Each change in the Prime Rate shall be effective immediately from and after such change.
Priority Indebtedness shall mean, without duplication, the sum of (a) all Indebtedness of Subsidiaries permitted by Section 5.05(n) and (b) all Indebtedness of Borrower secured by any Liens permitted by Section 5.06(g).
Published Rate shall mean the rate of interest published each Business Day in The Wall Street Journal Money Rates listing under the caption London Interbank Offered Rates for a one month period (or, if no such rate is published therein for any reason, then the Published Rate shall be the rate at which U.S. dollar deposits are offered by leading banks in the London interbank deposit market for a one month period as published in another publication selected by the Agent).
Receivables Related Assets shall mean accounts receivable, instruments, chattel paper, obligations, general intangibles and other similar assets, in each case relating to receivables subject to the Permitted Receivables Facility, including interests in merchandise or goods, the sale or lease of which gave rise to such receivables, related contractual rights, guaranties, insurance proceeds, collections and proceeds of all of the foregoing.
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Receivables Subsidiary shall mean a Wholly-Owned Subsidiary of Borrower that is established as a bankruptcy remote Subsidiary for the sole purpose of acquiring and selling accounts receivable under the Permitted Receivables Facility and that shall not engage in any activities other than in connection with the Permitted Receivables Facility.
Recipient shall mean (a) the Agent and (b) any Lender, as applicable.
Related Parties means, with respect to any Person, such Persons Affiliates and the officers, directors, attorneys, agents and employees of such Person and of such Persons Affiliates.
Related Writing shall mean each Loan Document and any other assignment, mortgage, security agreement, guaranty agreement, subordination agreement, financial statement, audit report or other writing furnished by Borrower, any Subsidiary or any Obligor, or any of their respective officers, to the Lenders pursuant to or otherwise in connection with this Agreement.
Reportable Compliance Event shall mean that any Covered Entity becomes a Sanctioned Person, or is indicted, arraigned, investigated or custodially detained, or receives an inquiry from regulatory or law enforcement officials, in connection with any Anti-Terrorism Law or any predicate crime to any Anti-Terrorism Law, or self-discovers facts or circumstances implicating any aspect of its operations with the actual or possible violation of any Anti-Terrorism Law.
Reportable Event shall mean a reportable event as that term is defined in Title IV of ERISA, except actions of general applicability by the Secretary of Labor under Section 110 of such Act.
Required Lenders(s) shall mean the holders of greater than fifty percent (50%) of the Total Commitment Amount. The Exposure of any Defaulting Lender shall be disregarded in determining Required Lenders at any time. Notwithstanding the foregoing, any amendment, consent or waiver resulting in treatment of any Defaulting Bank disproportionately adversely to other Banks shall require the consent of such Defaulting Bank.
Restricted Payment shall mean, with respect to Borrower or any Subsidiary, (a) any Capital Distribution, or (b) any amount paid by Borrower in repayment, redemption, retirement, repurchase, direct or indirect, of any Subordinated Indebtedness.
Sanctioned Country shall mean, at any time, a region, country or territory which is itself the subject or target of any Sanctions (at the time of this Agreement, Crimea, Cuba, Iran, North Korea, Sudan and Syria).
Sanctioned Person shall mean, at any time, (a) any Person listed in any Sanctions-related list of designated Persons maintained by the Office of Foreign Assets Control of the U.S. Department of the Treasury, the U.S. Department of State, or by the United Nations Security Council, Her Majestys Treasury, the European Union or any European Union member state, (b) any Person operating, organized or resident in a Sanctioned Country or (c) any Person owned or controlled by any such Person or Persons described in the foregoing clauses (a) or (b).
Sanctions shall mean economic or financial sanctions or trade embargoes imposed, administered or enforced from time to time by (a) the U.S. government, including those
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administered by the Office of Foreign Assets Control of the U.S. Department of the Treasury or the U.S. Department of State, or (b) the United Nations Security Council, the European Union, any European Union member state or Her Majestys Treasury of the United Kingdom.
SEC shall mean the United States Securities Exchange Commission. Securities Act shall mean the Securities Act of 1933, as amended.
Share Repurchase shall mean the purchase, repurchase, redemption or other acquisition by Borrower from any Person of any capital stock or other equity interest of Borrower.
Solvency Certificate shall mean a certificate of the chief financial officer of Borrower attesting to the solvency of the Borrower and its Subsidiaries, substantially in the form of the attached Exhibit H.
Specified Acquisition Agreement Representations shall mean the representations and warranties made by the Closing Date Target in the Closing Date Acquisition Documents that are material to the interests of the Agent, the Lead Arranger and the Lenders, but only to the extent that Borrower, its Subsidiaries or Affiliates have the right to terminate their respective obligations under the Closing Date Acquisition Documents or decline to consummate the Closing Date Acquisition as a result of a breach or inaccuracy of such representations in the Closing Date Acquisition Documents.
Standard & Poors shall mean Standard & Poors Ratings Group, a division of McGraw-Hill, Inc., or any successor to such company.
Subordinated, as applied to Indebtedness, shall mean that the Indebtedness has been subordinated (by written terms or written agreement being, in either case, in form and substance satisfactory to the Agent and the Required Lenders) in favor of the prior payment in full of the Debt.
Subordinated Indebtedness shall mean, for Borrower or any Subsidiary any Indebtedness that is Subordinated.
Subsidiary of any Person shall mean (i) a corporation more than fifty percent (50%) of the Voting Power of which is owned, directly or indirectly, by such Person or by one or more other Subsidiaries of such Person or by such Person and one or more Subsidiaries of such Person, (ii) a partnership or limited liability company of which such Person, one or more other Subsidiaries of such Person or such Person and one or more Subsidiaries of such Person, directly or indirectly, is a general partner or managing member, as the case may be, that, or otherwise, has the power to direct the policies, management and affairs thereof, or (iii) any other Person (other than a corporation) in which such Person, one or more other Subsidiaries of such Person or such Person and one or more Subsidiaries of such Person, directly or indirectly, has at least a majority interest in the Voting Power or the power to direct the policies, management and affairs thereof.
Taxes shall mean all present or future taxes, levies, imposts, duties, deductions, withholdings (including backup withholding), assessments, fees or other charges imposed by any Governmental Authority, including any interest, additions to tax or penalties applicable thereto.
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Three Year Base Rate Term Loan shall mean a Three Year Term Loan described in Section 2.01(b) hereof on which Borrower shall pay interest at a rate per annum equal to the sum of the Applicable Margin (from time to time in effect) plus the Base Rate.
Three Year Eurodollar Term Loans shall mean a Three Year Term Loan described in Section 2.01(b) hereof on which Borrower shall pay interest at a rate based upon the LIBOR Rate.
Three Year Term Loan shall mean a loan made by the Three Year Term Loan Lenders to Borrower pursuant to Section 2.01(b) hereof.
Three Year Term Loan Commitment shall mean the obligation hereunder of (a) each Lender making a Three Year Term Loan equal to the amount set forth opposite such Lenders name under the column headed Three Year Term Loan Commitment Amount as set forth on Schedule 1 hereto.
Three Year Term Loan Commitment Amount shall mean the principal amount of Two Hundred Million Dollars ($200,000,000).
Three Year Term Loan Lender shall mean a Lender with a Three Year Term Loan Commitment.
Three Year Term Loan Maturity Date shall mean the date that is three years after the Closing Date.
Three Year Term Loan Note shall mean any note delivered pursuant to Section 2.01(b) of this Agreement.
Total Commitment Amount shall mean the aggregate amount of the Five Year Term Loan Commitment Amount, the Three Year Term Loan Commitment Amount and the Eighteen Month Term Loan Commitment Amount.
Total Indebtedness shall mean, at any time, on a Consolidated basis, all Indebtedness of Borrower, including, but not limited to, current, long-term and Subordinated Indebtedness, if any, and all Indebtedness under the Permitted Receivables Facility.
Transactions means, collectively, (a) the consummation of the Closing Date Acquisition, (b) the entering into by the Loan Parties and their applicable Subsidiaries of the Loan Documents which they are or are intended to be a party and the funding of the Loans thereunder, (c) the refinancing of the Existing Closing Date Target Indebtedness and the termination of all commitments with respect thereto (other than Indebtedness permitted pursuant to Section 5.05) and (d) the payment of the fees and expenses incurred in connection with the consummation of the foregoing.
Updated Borrower Financial Statements shall have the meaning provided to such term in Section 4.02(a).
Updated Closing Date Target Financial Statements shall have the meaning provided to such term in Section 4.02(a).
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USA Patriot Act shall mean the Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism (USA PATRIOT Act) Act of 2001.
U.S. Person shall mean any Person that is a United States Person as defined in Section 7701(a)(30) of the Code.
U.S. Tax Compliance Certificate has the meaning assigned to such term in paragraph Section 3.02(f).
Voting Power shall mean, with respect to any Person, the exclusive ability to control, through the ownership of shares of capital stock, partnership interests, membership interests or otherwise, the election of members of the board of directors or other similar governing body of such Person, and the holding of a designated percentage of Voting Power of a Person means the ownership of shares of capital stock, partnership interests, membership interests or other interests of such Person sufficient to control exclusively the election of that percentage of the members of the board of directors or similar governing body of such Person.
Welfare Plan shall mean an ERISA Plan that is a welfare plan within the meaning of ERISA Section 3(l).
Wholly-Owned Subsidiary shall mean, with respect to any Person, any corporation, limited liability company or other entity, except for directors qualifying shares or shares required to be owned individually due to country specific regulations regarding ownership or control of the organization or operation of such entity, all of the securities or other ownership interest of which having ordinary voting power to elect a majority of the board of directors, or other persons performing similar functions, are at the time directly or indirectly owned by such Person.
Withholding Agent shall mean any Loan Party and the Agent.
Write-Down and Conversion Powers means, with respect to any EEA Resolution Authority, the write-down and conversion powers of such EEA Resolution Authority from time to time under the Bail-In Legislation for the applicable EEA Member Country, which write-down and conversion powers are described in the EU Bail-In Legislation Schedule.
Section 1.02 Accounting and Legal Principles, Terms and Determinations. All references in this Agreement to generally accepted accounting principles or GAAP shall be deemed to refer to generally accepted accounting principles in effect in the United States at the time of application thereof. Interim financial statements otherwise prepared in accordance with GAAP shall be deemed to comply with such principles subject to year-end adjustments and notwithstanding the absence of footnotes. Unless otherwise specified herein, all accounting terms used herein shall be interpreted, all determinations with respect to accounting matters hereunder shall be made, and all unaudited consolidated financial statements and certificates and reports as to financial matters required to be furnished hereunder shall be prepared, in accordance with generally accepted accounting principles applied on a basis consistent with the most recent audited consolidated financial statements of Borrower and its Subsidiaries made available pursuant to Section 5.01(b) or, if no such statements have been so delivered, the most recent audited financial statements referred to in Section 5.01(a). Any reference herein to any specific citation, section or form of law, statute, rule or regulation shall refer to such new, replacement or
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analogous citation, section or form should such citation, section or form be modified, amended or replaced. Any definition of or reference to any agreement, instrument or other document herein shall be construed as referring to such agreement, instrument or other document as from time to time amended, restated, supplemented or otherwise modified (subject to any restrictions on such amendments, supplements or modifications set forth herein or in any other Loan Document). Notwithstanding the foregoing, for purposes of determining compliance with any covenant (including the computation of any financial covenant) contained herein, Indebtedness of Borrower and its Subsidiaries shall be deemed to be carried at 100% of the outstanding principal amount thereof.
Section 1.03 Terms Generally. The foregoing definitions shall be applicable to the singular and plurals of the foregoing defined terms.
ARTICLE II
AMOUNT AND TERMS OF CREDIT
Section 2.01 Amount and Nature of Credit.
(a) Subject to the terms and conditions of this Agreement, each Five Year Term Loan Lender, for itself and not one for any other, agrees to make the Five Year Term Loans hereunder on the Closing Date.
(i) Borrower shall have the option to choose any combination of (a) Five Year Base Rate Term Loans, or (b) Five Year Eurodollar Term Loans. No Five Year Term Loans may be borrowed until the Closing Date and no Five Year Term Loans may be borrowed after the Closing Date. Borrower shall be entitled to repay Five Year Term Loans in whole or in part, but once repaid a Five Year Term Loan may not be re-borrowed.
(ii) The obligation of each Five Year Term Loan Lender to make Five Year Term Loans to Borrower shall be in the proportion that such Five Year Term Loan Lenders Commitment bears to the Five Year Term Loan Commitments of all Five Year Term Loan Lenders to Borrower, but each Five Year Term Loan Lenders Five Year Term Loan to Borrower shall never exceed its Five Year Term Loan Commitment. The failure of any Five Year Term Loan Lender to make a Five Year Term Loan shall not relieve any other Five Year Term Loan Lender of its obligations to make a Five Year Term Loan nor shall it impose any additional liability on any other Five Year Term Loan Lender hereunder. The Five Year Term Loan Lenders shall have no obligation to make Five Year Term Loans hereunder until the Closing Date. The Five Year Term Loan Lenders shall have no obligation to make Five Year Term Loan Loans hereunder after the Closing Date. The Five Year Term Loan Commitments are not revolving credit commitments, and Borrower shall not have the right to borrow, repay and reborrow under this Section 2.01(a). The Five Year Term Loans shall be due and payable on the Five Year Term Loan Maturity Date.
(iii) Borrower shall pay interest on the unpaid principal amount of Five Year Base Rate Term Loans made to it outstanding from time to time from the date thereof until paid at the Base Rate from time to time in effect. Interest on such Five Year Base Rate Term Loans shall be payable on the last day of each September, December, March and June of each year and at the maturity thereof.
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(iv) Borrower shall pay interest on the unpaid principal amount of each Five Year Eurodollar Term Loan made to it outstanding from time to time, fixed in advance on the first day of the Interest Period applicable thereto through the last day of the Interest Period applicable thereto (but subject to changes in the Applicable Margin), at the Derived Eurodollar Rate. Interest on such Five Year Eurodollar Term Loans shall be payable on each Interest Adjustment Date (provided that if an Interest Period exceeds three (3) months, the interest must be paid every three (3) months, commencing three (3) months from the beginning of such Interest Period).
(v) At the request of Borrower to Agent, subject to the notice and other provisions of Section 2.02 hereof, the Five Year Term Loan Lenders shall convert outstanding Five Year Base Rate Term Loans to Five Year Base Rate Eurodollar Term Loans at any time and shall convert outstanding Five Year Eurodollar Term Loans to Five Year Base Rate Term Loans on any Interest Adjustment Date.
(vi) The obligation of Borrower to repay Five Year Term Loans made to it by a Five Year Term Loan Lender pursuant to this Section 2.01(a) and to pay interest thereon may, upon the request by such Five Year Term Loan Lender, be evidenced by a single Five Year Term Loan Note of Borrower in the form of Exhibit A hereto (each such note, a Five Year Term Loan Note), payable to such Five Year Term Loan Lender in the principal amount of its Five Year Term Loan Commitment.
(b) Subject to the terms and conditions of this Agreement, each Three Year Term Loan Lender, for itself and not one for any other, agrees to make the Three Year Term Loans hereunder on the Closing Date.
(i) Borrower shall have the option to choose any combination of (a) Three Year Base Rate Term Loans, or (b) Three Year Eurodollar Term Loans. No Three Year Term Loans may be borrowed until the Closing Date and no Three Year Term Loans may be borrowed after the Closing Date. Borrower shall be entitled to repay Three Year Term Loans in whole or in part, but once repaid a Three Year Term Loan may not be re-borrowed.
(ii) The obligation of each Three Year Term Loan Lender to make Three Year Term Loans to Borrower shall be in the proportion that such Three Year Term Loan Lenders Commitment bears to the Three Year Term Loan Commitments of all Three Year Term Loan Lenders to Borrower, but each Three Year Term Loan Lenders Three Year Term Loan to Borrower shall never exceed its Three Year Term Loan Commitment. The failure of any Three Year Term Loan Lender to make a Three Year Term Loan shall not relieve any other Three Year Term Loan Lender of its obligations to make a Three Year Term Loan nor shall it impose any additional liability on any other Three Year Term Loan Lender hereunder. The Three Year Term Loan Lenders shall have no obligation to make Three Year Term Loan Loans hereunder until the Closing Date. The Three Year Term Loan Lenders shall have no obligation to make Three Year Term Loans hereunder after the Closing Date. The Three Year Term Loan Commitments are not revolving credit commitments, and Borrower shall not have the right to borrow, repay and reborrow under this Section 2.01(b). The Three Year Term Loans shall be due and payable on the Three Year Term Loan Maturity Date.
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(iii) Borrower shall pay interest on the unpaid principal amount of Three Year Base Rate Term Loans made to it outstanding from time to time from the date thereof until paid at the Base Rate from time to time in effect. Interest on such Three Year Base Rate Term Loans shall be payable on the last day of each September, December, March and June of each year and at the maturity thereof.
(iv) Borrower shall pay interest on the unpaid principal amount of each Three Year Eurodollar Term Loan made to it outstanding from time to time, fixed in advance on the first day of the Interest Period applicable thereto through the last day of the Interest Period applicable thereto (but subject to changes in the Applicable Margin), at the Derived Eurodollar Rate. Interest on such Three Year Eurodollar Term Loans shall be payable on each Interest Adjustment Date (provided that if an Interest Period exceeds three (3) months, the interest must be paid every three (3) months, commencing three (3) months from the beginning of such Interest Period).
(v) At the request of Borrower to Agent, subject to the notice and other provisions of Section 2.02 hereof, the Three Year Term Loan Lenders shall convert outstanding Three Year Base Rate Term Loans to Three Year Base Rate Eurodollar Term Loans at any time and shall convert outstanding Three Year Eurodollar Term Loans to Three Year Base Rate Term Loans on any Interest Adjustment Date.
(vi) The obligation of Borrower to repay Three Year Term Loans made to it by a Three Year Term Loan Lender pursuant to this Section 2.01(b) and to pay interest thereon may, upon the request by such Three Year Term Loan Lender, be evidenced by a single Three Year Term Loan Note of Borrower in the form of Exhibit B hereto (each such note, a Three Year Term Loan Note), payable to such Three Year Term Loan Lender in the principal amount of its Three Year Term Loan Commitment.
(c) Subject to the terms and conditions of this Agreement, each Eighteen Month Term Loan Lender, for itself and not one for any other, agrees to make the Eighteen Month Term Loans hereunder on the Closing Date.
(i) Borrower shall have the option to choose any combination of (a) Eighteen Month Base Rate Term Loans, or (b) Eighteen Month Eurodollar Term Loans. No Eighteen Month Term Loans may be borrowed until the Closing Date and no Eighteen Month Term Loans may be borrowed after the Closing Date. Borrower shall be entitled to repay Eighteen Month Term Loans in whole or in part, but once repaid a Eighteen Month Term Loan may not be re-borrowed.
(ii) The obligation of each Eighteen Month Term Loan Lender to make Eighteen Month Term Loans to Borrower shall be in the proportion that such Eighteen Month Term Loan Lenders Commitment bears to the Eighteen Month Term Loan Commitments of all Eighteen Month Term Loan Lenders to Borrower, but each Eighteen Month Term Loan Lenders Eighteen Month Term Loan to Borrower shall never exceed its Eighteen Month Term Loan Commitment. The failure of any Eighteen Month Term Loan Lender to make a Eighteen Month Term Loan shall not relieve any other Eighteen Month Term Loan Lender of its obligations to make a Eighteen Month Term Loan nor shall it impose any additional liability on any other Eighteen Month Term Loan Lender hereunder. The Eighteen Month Term Loan Lenders shall have no obligation to make Eighteen Month Term Loans hereunder until the Closing Date. The
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Eighteen Month Term Loan Lenders shall have no obligation to make Eighteen Month Term Loan Loans hereunder after the Closing Date. The Eighteen Month Term Loan Commitments are not revolving credit commitments, and Borrower shall not have the right to borrow, repay and reborrow under this Section 2.01(c). The Eighteen Month Term Loans shall be due and payable on the Eighteen Month Term Loan Maturity Date.
(iii) Borrower shall pay interest on the unpaid principal amount of Eighteen Month Base Rate Term Loans made to it outstanding from time to time from the date thereof until paid at the Base Rate from time to time in effect. Interest on such Eighteen Month Base Rate Term Loans shall be payable on the last day of each September, December, March and June of each year and at the maturity thereof.
(iv) Borrower shall pay interest on the unpaid principal amount of each Eighteen Month Eurodollar Term Loan made to it outstanding from time to time, fixed in advance on the first day of the Interest Period applicable thereto through the last day of the Interest Period applicable thereto (but subject to changes in the Applicable Margin), at the Derived Eurodollar Rate. Interest on such Eighteen Month Eurodollar Term Loans shall be payable on each Interest Adjustment Date (provided that if an Interest Period exceeds three (3) months, the interest must be paid every three (3) months, commencing three (3) months from the beginning of such Interest Period).
(v) At the request of Borrower to Agent, subject to the notice and other provisions of Section 2.02 hereof, the Eighteen Month Term Loan Lenders shall convert outstanding Eighteen Month Base Rate Term Loans to Eighteen Month Base Rate Eurodollar Term Loans at any time and shall convert outstanding Eighteen Month Eurodollar Term Loans to Eighteen Month Base Rate Term Loans on any Interest Adjustment Date.
(vi) The obligation of Borrower to repay Eighteen Month Term Loans made to it by a Eighteen Month Term Loan Lender pursuant to this Section 2.01(c) and to pay interest thereon may, upon the request by such Eighteen Month Term Loan Lender, be evidenced by a single Eighteen Month Term Loan Note of Borrower in the form of Exhibit C hereto (each such note, a Eighteen Month Term Loan Note), payable to such Eighteen Month Term Loan Lender in the principal amount of its Eighteen Month Term Loan Commitment.
Section 2.02 Conditions To Loans and Conversion/Continuation of Loans. The obligation of the Lenders to make, continue or convert any Loan, is conditioned, in the case of the borrowing, conversion or continuation hereunder, upon:
(a) all conditions precedent as listed in Article IV hereof shall have been satisfied (with regard only to making the Loans and not otherwise thereafter);
(b) with respect to Base Rate Loans, receipt by Agent of a Notice of Loan, such notice to be received by 11:00 A.M. (Cleveland, Ohio time) on the proposed date of borrowing or conversion, and, with respect to Eurodollar Loans, by 11:00 A.M. (Cleveland, Ohio time) three (3) Business Days prior to the proposed date of borrowing, conversion or continuation. Agent shall notify each Lender of the date, amount and initial Interest Period (if applicable) promptly upon the receipt of such notice, and, in any event, by 2:00 P.M. (Cleveland, Ohio time) on the date such notice is received. On the date such Loan is to be made, each Lender
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shall provide Agent, not later than 3:00 P.M. (Cleveland, Ohio time), with the amount in federal or other immediately available funds, required of it. If Agent elects to advance the proceeds of such Loan prior to receiving funds from such Lender, Agent shall have the right, upon prior notice to Borrower, to debit any account of Borrower or otherwise receive from Borrower, on demand, such amount, in the event that such Lender fails to reimburse Agent in accordance with this subsection. Agent shall also have the right to receive interest from such Lender at the Federal Funds Effective Rate in the event that such Lender shall fail to provide its portion of the Loan on the date requested and Agent elects to provide such funds;
(c) Borrowers request for (i) a Base Rate Loan shall be in an amount of not less than One Million Dollars ($1,000,000), increased by increments of Five Hundred Thousand Dollars ($500,000); or (ii) a Eurodollar Loan shall be in an amount of not less than Five Million Dollars ($5,000,000), increased by increments of One Million Dollars ($1,000,000);
(d) the fact that no Default or Event of Default shall then exist or immediately after the making, conversion or continuation of the Loan would exist;
(e) the fact that each of the representations and warranties contained in Article VI hereof shall be true and correct with the same force and effect as if made on and as of the date of the making of the Loans, except to the extent that any thereof expressly relate to an earlier date; and
At no time shall Borrower request that Eurodollar Loans be outstanding for more than ten (10) different Interest Periods, at any time, and, if Base Rate Loans are outstanding, then Eurodollar Loans shall be limited to nine (9) different Interest Periods.
Each request for a Eurodollar Loan shall be irrevocable and binding on Borrower and Borrower shall indemnify Agent and the Lenders against any loss or expense incurred by Agent or the Lenders as a result of any failure by Borrower to consummate such transaction including, without limitation, any loss (including loss of anticipated profits) or expense incurred by reason of liquidation or re-employment of deposits or other funds acquired by the Lenders to fund such Eurodollar Loan. A certificate as to the amount of such loss or expense submitted by the Lenders to Borrower shall be conclusive and binding for all purposes, absent manifest error.
Section 2.03 Payments, Etc.
(a) Payments Generally. Each payment made hereunder by Borrower shall be made without any offset, abatement, recoupment, counterclaim, withholding or reduction whatsoever.
(b) Payments in Dollars. With respect to (i) any Loan, or (ii) any other payment to Agent and the Lenders that is not covered by subsection (a) hereof, all such payments (including prepayments) to Agent and the Lenders of the principal of or interest on such Loan or other payment, including but not limited to principal, interest, fees or any other amount owed by Borrower under this Agreement, shall be made in Dollars. All payments described in this subsection (b) shall be remitted to Agent at its main office for the account of the Lenders not later than 11:00 A.M. (Cleveland, Ohio time) on the due date thereof in immediately available funds. Any such payments received by Agent after 11:00 A.M. (Cleveland, Ohio time) shall be deemed to have been made and received on the next following Business Day.
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(c) Payments Net of Taxes. All payments under this Agreement or any other Loan Document by Borrower or any other Obligor shall be made absolutely net of, without deduction or offset for, and altogether free and clear of, any and all present and future taxes, levies, deductions, charges and withholdings and all liabilities with respect thereto, under the laws of the United States of America or any foreign jurisdiction (or any state or political subdivision thereof), excluding income and franchise taxes imposed on any Lender (and withholding relating thereto) other than such income or franchise taxes arising solely from such Lender having executed, delivered or performed its obligations or received a payment under, or enforced the Loan Documents, under the laws of the United States of America or any foreign jurisdiction (or any state or political subdivision thereof). If Borrower or other Obligor is compelled by law to deduct any such taxes or levies (other than such excluded taxes) or to make any such other deductions, charges or withholdings, then Borrower or such Obligor, as the case may be, shall pay such additional amounts as may be necessary in order that the net payments after such deduction, and after giving effect to any United States or foreign jurisdiction (or any state or political subdivision thereof) income taxes required to be paid by the Lenders in respect of such additional amounts, shall equal the amount of interest provided in Section 2.01 hereof for each Loan plus any principal then due. In each such case, Borrower shall provide to the applicable Lender evidence demonstrating that such taxes or levies have been paid.
(d) Payments to Lenders. Upon Agents receipt of payments hereunder, Agent shall immediately distribute to each Lender its ratable share, if any, of the amount of principal, interest, and fees received by it for the account of such Lender. Each Lender shall record any principal, interest or other payment, the principal amounts of Base Rate Loans and Eurodollar Loans, all prepayments and the applicable dates, including Interest Periods, with respect to the Loans made, and payments received by such Lender, by such method as such Lender may generally employ; provided, however, that failure to make any such entry shall in no way detract from the obligations of Borrower hereunder or under the other Loan Documents. The aggregate unpaid amount of Loans, types of Loans, Interest Periods and similar information with respect to such Loans set forth on the records of Agent shall be rebuttably presumptive evidence with respect to such information, including the amounts of principal and interest owing and unpaid with respect to each Loan.
(e) Timing of Payments. Whenever any payment to be made hereunder, including, without limitation, any payment to be made with respect to any Loan, shall be stated to be due on a day that is not a Business Day, such payment shall be made on the next succeeding Business Day and such extension of time shall in each case be included in the computation of the interest payable on such amount; provided, however, that, with respect to any Eurodollar Loan, if the next succeeding Business Day falls in the succeeding calendar month, such payment shall be made on the preceding Business Day and the relevant Interest Period shall be adjusted accordingly.
Section 2.04 Prepayment.
(a) Right to Prepay. Borrower shall have the right, at any time or from time to time, to prepay, on a pro rata basis for all of the Lenders, all or any part of the principal amount of the Loans then outstanding, as designated by Borrower, plus interest accrued on the amount so prepaid to the date of such prepayment; and
(b) Prepayment Fees.
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(i) Prepayments of Base Rate Loans shall be without any premium or penalty;
(ii) In any case of prepayment (or, any assignment pursuant to Section 3.09) of a Eurodollar Loan, Borrower agrees that if the reinvestment rate with respect to the amount of such Eurodollar Loan, as quoted by the money desk of Agent (the Reinvestment Rate), shall be lower than the LIBOR Rate applicable to the Eurodollar Loan that is intended to be prepaid (hereinafter, Last LIBOR), then Borrower shall, upon written notice from Agent, promptly pay to Agent, for the account of each Lender, in immediately available funds, a prepayment fee equal to the product of (A) a rate (the Prepayment Rate) which shall be equal to the difference between the Last LIBOR and the Reinvestment Rate, times (B) the prepayment principal amount of the Eurodollar Loan that is to be prepaid, times (C) (1) the number of days remaining in the Interest Period of the Eurodollar Loan that is to be prepaid divided by (2) three hundred sixty (360) but no additional premium or penalty shall apply. In addition, Borrower shall immediately pay directly to Agent, for the account of the Lenders, the amount of any additional costs or expenses (including, without limitation, cost of telex, wires, or cables) incurred by Agent or the Lenders in connection with the prepayment, upon Borrowers receipt of a written statement from Agent.
(c) Notice of Prepayment. Borrower shall give Agent written notice of prepayment of any Base Rate Loan by not later than 11:00 A.M. (Cleveland, Ohio time) on the Business Day such prepayment is to be made and written notice of the prepayment of any Eurodollar Loan not later than 1:00 P.M. (Cleveland, Ohio time) three (3) Business Days prior to the Business Day on which such prepayment is to be made.
(d) Minimum Amount. Each prepayment of a Loan by Borrower shall be in the aggregate principal amount of not less than Five Million Dollars ($5,000,000), except in the case of a mandatory prepayment in connection with Article III hereof.
(e) Application of Prepayment. All prepayments required pursuant to this Section 2.04 shall first be applied among the Base Rate Loans, then to Eurodollar Loans.
Section 2.05 Fees. Borrower shall pay to the Lenders the fees set forth in the Fee Letter.
Section 2.06 Computation of Interest and Fees; Default Rate. With the exception of Base Rate Loans, interest on Loans and fees and charges hereunder shall be computed on the basis of a year having three hundred sixty (360) days and calculated for the actual number of days elapsed. With respect to Base Rate Loans interest shall be computed on the basis of a year having three hundred sixty-five (365) days or three hundred sixty-six (366) days, as the case may be, and calculated for the actual number of days elapsed. Anything herein to the contrary notwithstanding, if an Event of Default shall occur and be continuing hereunder, at the option of Agent or the Required Lenders, the principal of each Loan, the unpaid interest thereon and any other amounts owing hereunder shall bear interest, until such time as such Event of Default has been cured, waived or amended or is no longer continuing, at the Default Rate. In no event shall the rate of interest hereunder exceed the maximum rate allowable by law.
Section 2.07 Defaulting Lender.
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(a) Defaulting Lender Adjustments. Notwithstanding anything to the contrary contained in this Agreement, if any Lender becomes a Defaulting Lender, then, until such time as such Lender is no longer a Defaulting Lender, to the extent permitted by applicable law:
(i) Waivers and Amendments. Such Defaulting Lenders right to approve or disapprove any amendment, waiver or consent with respect to this Agreement shall be restricted as set forth in the definition of Required Lender.
(ii) Defaulting Lender Waterfall. Any payment of principal, interest, fees or other amounts received by the Agent for the account of such Defaulting Lender (whether voluntary or mandatory, at maturity, pursuant to Article VII or otherwise) or received by the Agent from a Defaulting Lender pursuant to Section 8.04 shall be applied as follows: first, to the payment of any amounts owing by such Defaulting Lender to the Agent hereunder; second, as the Borrower may request (so long as no Default or Event of Default exists), to the funding of any Loan in respect of which such Defaulting Lender has failed to fund its portion thereof as required by this Agreement, as determined by the Agent; third, if so determined by the Agent and the Borrower, to be held in a deposit account and released pro rata in order to satisfy such Defaulting Lenders potential future funding obligations with respect to Loans under this Agreement; fourth, to the payment of any amounts owing to the Lenders as a result of any final judgment of a court of competent jurisdiction obtained by any Lender against such Defaulting Lender as a result of such Defaulting Lenders breach of its obligations under this Agreement; fifth, so long as no Default or Event of Default exists, to the payment of any amounts owing to Borrower as a result of any final judgment of a court of competent jurisdiction obtained by Borrower against such Defaulting Lender as a result of such Defaulting Lenders breach of its obligations under this Agreement; and sixth, to such Defaulting Lender or as otherwise directed by a court of competent jurisdiction; provided that if (x) such payment is a payment of the principal amount of any Loans in respect of which such Defaulting Lender has not fully funded its appropriate share, and (y) such Loans were made at a time when the conditions set forth in Section 2.02 were satisfied or waived, such payment shall be applied solely to pay the Loans of all Non-Defaulting Lender on a pro rata basis prior to being applied to the payment of any Loans of such Defaulting Lender until such time as all Loans are held by the Lender pro rata in accordance with the Five Year Term Loan Commitment Amount, Three Year Term Loan Commitment Amount or Eighteen Month Term Loan Commitment Amount, as applicable. Any payments, prepayments or other amounts paid or payable to a Defaulting Lender that are applied (or held) to pay amounts owed by a Defaulting Lender pursuant to this Section 2.07(a)(ii) shall be deemed paid to and redirected by such Defaulting Lender, and each Lender irrevocably consents hereto.
(b) Defaulting Lender Cure. If Borrower and the Agent agree in writing that a Lender is no longer a Defaulting Lender, the Agent will so notify the parties hereto, whereupon as of the effective date specified in such notice and subject to any conditions set forth therein such Lender will, to the extent applicable, purchase at par that portion of outstanding Loans of the other Lenders or take such other actions as the Agent may determine to be necessary to cause the Loans to be held pro rata by the Lenders in accordance with the Commitments, whereupon such Lender will cease to be a Defaulting Lender; provided that no adjustments will be made retroactively with respect to payments made by or on behalf of Borrower while such Lender was a Defaulting Lender; and provided, further, that except to the extent otherwise expressly agreed
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by the affected parties, subject to Section 10.19, no change hereunder from Defaulting Lender to Lender will constitute a waiver or release of any claim of any party hereunder arising from such Lender having been a Defaulting Lender.
ARTICLE III
INCREASED CAPITAL; TAXES, ETC.
Section 3.01 Increased Costs.
(a) Increased Costs Generally. If any Change in Law shall:
(i) impose, modify or deem applicable any reserve, special deposit, compulsory loan, insurance charge or similar requirement (on a net basis) against assets of, deposits with or for the account of, or credit extended or participated in by, any Lender (except any reserve requirement reflected in the LIBOR Rate);
(ii) subject any Recipient to any Taxes (other than (A) Indemnified Taxes, (B) Taxes described in clauses (b) through (d) of the definition of Excluded Taxes and (C) Connection Income Taxes) on its loans, loan principal, letters of credit, commitments, or other obligations, or its deposits, reserves, other liabilities or capital attributable thereto;
(iii) impose on any Lender or the London interbank market any other condition, cost or expense (other than Taxes) affecting this Agreement or Loans made by such Lender or participation therein;
and the result of any of the foregoing shall be to increase the cost to such Lender or such other Recipient of making, converting to, continuing or maintaining any Loan or of maintaining its obligation to make any such Loan, or to increase the cost to such Lender, or such other Recipient of participating in, or to reduce the amount of any sum received or receivable by such Lender or other Recipient hereunder (whether of principal, interest or any other amount) then, upon request of such Lender or other Recipient, Borrower will pay to such Lender or other Recipient, as the case may be, such additional amount or amounts as will compensate such Lender or other Recipient, as the case may be, for such additional costs incurred or reduction suffered.
(b) Certificates for Reimbursement. A certificate of a Lender setting forth the amount or amounts necessary to compensate such Lender or its holding company, as the case may be, as specified in paragraph (a) of this Section and delivered to Borrower, shall be conclusive absent manifest error. Borrower shall pay such Lender, the amount shown as due on any such certificate within 10 days after receipt thereof.
(c) Delay in Requests. Failure or delay on the part of any Lender to demand compensation pursuant to this Section shall not constitute a waiver of such Lenders right to demand such compensation; provided that Borrower shall not be required to compensate a Lender pursuant to this Section for any increased costs incurred or reductions suffered more than nine months prior to the date that such Lender notifies Borrower of the Change in Law giving rise to such increased costs or reductions, and of such Lenders intention to claim compensation therefor (except that, if the Change in Law giving rise to such increased costs or reductions is retroactive, then the nine-month period referred to above shall be extended to include the period of retroactive effect thereof).
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Section 3.02 Tax Law, Etc.
(a) Payments Free of Taxes. Any and all payments by or on account of any obligation of Borrower under any Loan Document shall be made without deduction or withholding for any Taxes, except as required by applicable law. If any applicable law (as determined in the good faith discretion of an applicable Withholding Agent) requires the deduction or withholding of any Tax from any such payment by a Withholding Agent, then the applicable Withholding Agent shall be entitled to make such deduction or withholding and shall timely pay the full amount deducted or withheld to the relevant Governmental Authority in accordance with applicable law and, if such Tax is an Indemnified Tax, then the sum payable by Borrower shall be increased as necessary so that after such deduction or withholding has been made (including such deductions and withholdings applicable to additional sums payable under this Section) the applicable Recipient receives an amount equal to the sum it would have received had no such deduction or withholding been made.
(b) Payment of Other Taxes by Borrower. Borrower shall timely pay to the relevant Governmental Authority in accordance with applicable law, or at the option of the Agent timely reimburse it for the payment of, any Other Taxes.
(c) Indemnification by Borrower. Borrower shall indemnify each Recipient, within 10 days after demand therefor, for the full amount of any Indemnified Taxes (including Indemnified Taxes imposed or asserted on or attributable to amounts payable under this Section) payable or paid by such Recipient or required to be withheld or deducted from a payment to such Recipient and any reasonable expenses arising therefrom or with respect thereto, whether or not such Indemnified 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 Borrower by a Lender (with a copy to the Agent), or by the Agent on its own behalf or on behalf of a Lender, shall be conclusive absent manifest error.
(d) Indemnification by the Lenders. Each Lender shall severally indemnify the Agent, within 10 days after demand therefor, for (i) any Indemnified Taxes attributable to such Lender (but only to the extent that Borrower have not already indemnified the Agent for such Indemnified Taxes and without limiting the obligation of Borrower to do so), (ii) any Taxes attributable to such Lenders failure to comply with the provisions of Section 10.11 relating to the maintenance of a Participant Register and (iii) any Excluded Taxes attributable to such Lender, in each case, that are payable or paid by the Agent in connection with any Loan Document, and any reasonable expenses arising therefrom or with respect thereto, whether or not such 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 any Lender by the Agent shall be conclusive absent manifest error. Each Lender hereby authorizes the Agent to set off and apply any and all amounts at any time owing to such Lender under any Loan Document or otherwise payable by the Agent to the Lender from any other source against any amount due to the Agent under this paragraph (d).
(e) Evidence of Payments. As soon as practicable after any payment of Taxes by Borrower to a Governmental Authority pursuant to this Section 3.02, Borrower shall deliver to the 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 Agent.
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(f) Status of Lenders.
(i) Any Lender that is entitled to an exemption from or reduction of withholding Tax with respect to payments made under any Loan Document shall deliver to Borrower and the Agent, at the time or times reasonably requested by Borrower or the Agent, such properly completed and executed documentation reasonably requested by Borrower or the Agent as will permit such payments to be made without withholding or at a reduced rate of withholding. In addition, any Lender, if reasonably requested by Borrower or the Agent, shall deliver such other documentation prescribed by applicable law or reasonably requested by Borrower or the Agent as will enable Borrower or the Agent to determine whether or not such Lender is subject to backup withholding or information reporting requirements. Notwithstanding anything to the contrary in the preceding two sentences, the completion, execution and submission of such documentation (other than such documentation set forth in Section 3.02(f)(ii)(A), (ii) (B) and (ii) (D) below) shall not be required if in the Lenders reasonable judgment such completion, execution or submission would subject such Lender to any material unreimbursed cost or expense or would materially prejudice the legal or commercial position of such Lender.
(ii) Without limiting the generality of the foregoing.
(A) any Lender that is a U.S. Person shall deliver to Borrower and the Agent on or prior to the date on which such Lender becomes a Lender under this Agreement (and from time to time thereafter upon the reasonable request of Borrower or the Agent), executed originals of IRS Form W-9 certifying that such Lender is exempt from U.S. federal backup withholding tax;
(B) any Foreign Lender shall, to the extent it is legally entitled to do so, deliver to Borrower and the Agent (in such number of copies as shall be requested by the recipient) on or prior to the date on which such Foreign Lender becomes a Lender under this Agreement (and from time to time thereafter upon the reasonable request of Borrower or the Agent), whichever of the following is applicable:
(i) in the case of a Foreign Lender claiming the benefits of an income tax treaty to which the United States is a party (x) with respect to payments of interest under any Loan Document, executed originals of IRS Form W-8BENE (or W-8BEN, as applicable) establishing an exemption from, or reduction of, U.S. federal withholding Tax pursuant to the interest article of such tax treaty and (y) with respect to any other applicable payments under any Loan Document, IRS Form W-8BENE (or W-8BEN, as applicable) establishing an exemption from, or reduction of, U.S. federal withholding Tax pursuant to the business profits or other income article of such tax treaty;
(ii) executed originals of IRS Form W-8ECI;
(iii) in the case of a Foreign Lender claiming the benefits of the exemption for portfolio interest under Section 881(c) of the Code, (x) a certificate to the effect that such Foreign Lender is not a lender within the meaning of Section 881(c)(3)(A) of the Code, a 10 percent shareholder of Borrower within the meaning of Section 881(c)(3)(B) of the Code, or a
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controlled foreign corporation described in Section 881(c)(3)(C) of the Code (a U.S. Tax Compliance Certificate) and (y) executed originals of IRS Form W-8BENE (or W-8BEN, as applicable); or
(iv) to the extent a Foreign Lender is not the beneficial owner, executed originals of IRS Form W-8IMY, accompanied by IRS Form W-8ECI, IRS Form W-8BENE (or W-8BEN, as applicable), a U.S. Tax Compliance Certificate acceptable to Borrower, IRS Form W-9, and/or other certification documents from each beneficial owner, as applicable; provided that if the Foreign Lender is a partnership and one or more direct or indirect partners of such Foreign Lender are claiming the portfolio interest exemption, such Foreign Lender may provide a U.S. Tax Compliance Certificate on behalf of each such direct and indirect partner;
(C) any Foreign Lender shall, to the extent it is legally entitled to do so, deliver to Borrower and the Agent (in such number of copies as shall be requested by the recipient) on or prior to the date on which such Foreign Lender becomes a Lender under this Agreement (and from time to time thereafter upon the reasonable request of Borrower or the Agent), executed originals of any other form prescribed by applicable law as a basis for claiming exemption from or a reduction in U.S. federal withholding Tax, duly completed, together with such supplementary documentation as may be prescribed by applicable law to permit Borrower or the Agent to determine the withholding or deduction required to be made; and
(D) if a payment made to a Lender under any Loan Document would be subject to U.S. federal withholding Tax imposed by FATCA if such Lender were to fail to comply with the applicable reporting requirements of FATCA (including those contained in Section 1471(b) or 1472(b) of the Code, as applicable), such Lender shall deliver to Borrower and the Agent at the time or times prescribed by law and at such time or times reasonably requested by Borrower or the Agent such documentation prescribed by applicable law (including as prescribed by Section 1471(b)(3)(C)(i) of the Code) and such additional documentation reasonably requested by Borrower or the Agent as may be necessary for Borrower and the Agent to comply with their obligations under FATCA and to determine that such Lender has complied with such Lenders obligations under FATCA or to determine the amount to deduct and withhold from such payment. Solely for purposes of this clause (D), FATCA shall include any amendments made to FATCA after the date of this Agreement.
Each Lender agrees that if any form or certification it previously delivered expires or becomes obsolete or inaccurate in any respect, it shall update such form or certification or promptly notify Borrower and the Agent in writing of its legal inability to do so.
(g) Treatment of Certain Refunds. If any party determines, in its sole discretion exercised in good faith, that it has received a refund of any Taxes as to which it has been indemnified pursuant to this Section 3.02 (including by the payment of additional amounts pursuant to this Section 3.02), it shall pay to the indemnifying party an amount equal to such refund (but only to the extent of indemnity payments made under this Section with respect to the Taxes giving rise to such refund), net of all out-of-pocket expenses (including Taxes) of such indemnified party and without interest (other than any interest paid by the relevant Governmental Authority with respect to such refund). Such indemnifying party, upon the request of such indemnified party, shall repay to such indemnified party the amount paid over pursuant to this paragraph (g) (plus any penalties, interest or other charges imposed by the relevant
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Governmental Authority) in the event that such indemnified party is required to repay such refund to such Governmental Authority. Notwithstanding anything to the contrary in this paragraph (g), in no event will the indemnified party be required to pay any amount to an indemnifying party pursuant to this paragraph (g) the payment of which would place the indemnified party in a less favorable net after-Tax position than the indemnified party would have been in if the indemnification payments or additional amounts giving rise to such refund had never been paid. This paragraph shall not be construed to require any indemnified party to make available its Tax returns (or any other information relating to its Taxes that it deems confidential) to the indemnifying party or any other Person.
(h) Survival. Each partys obligations under this Section 3.02, Section 3.01, Section 3.04 and Section 3.07 shall survive the resignation or replacement of the Agent or any assignment of rights by, or the replacement of, a Lender, the termination of the Commitments and the repayment, satisfaction or discharge of all obligations under any Loan Document.
Section 3.03 Eurodollar Deposits Unavailable or Interest Rate Unascertainable. In respect of any Eurodollar Loan, in the event that Agent shall have determined that for Eurodollar Loans, that Dollar deposits in the relevant amount for the relevant Interest Period for such Eurodollar Loan are not available to Agent in the applicable Eurodollar market, or that, by reason of circumstances affecting such market, adequate and reasonable means do not exist for ascertaining the applicable LIBOR Rate applicable to such Interest Period, as the case may be, Agent shall promptly give notice of such determination to Borrower and (a) any notice of a conversion of an existing Base Rate Loan to a Eurodollar Loan shall be deemed a notice to continue a Base Rate Loan, and (b) Borrower shall be obligated either to prepay, or with respect to a Eurodollar Loan, to convert to a Base Rate Loan, any outstanding Eurodollar Loan on the last day of the then current Interest Period with respect thereto.
Section 3.04 Indemnity. Without prejudice to any other provisions of this Article III, Borrower hereby agrees to indemnify each Lender against any loss or expense that such Lender may sustain or incur as a consequence of any default by Borrower in payment when due of any amount hereunder in respect of any Eurodollar Loan, including, but not limited to, any loss of profit, premium or penalty incurred by such Lender in respect of funds borrowed by it for the purpose of making or maintaining such Eurodollar Loan, as determined by such Lender in the exercise of its sole but reasonable discretion. A certificate as to any such loss or expense shall be promptly submitted by such Lender to Borrower and shall, in the absence of manifest error, be conclusive and binding as to the amount thereof.
Section 3.05 Changes in Law Rendering Eurodollar Loans Unlawful . If at any time any Change in Law shall make it unlawful for any Lender to fund any Eurodollar Loan that it is committed to make hereunder, the commitment of such Lender to fund such Eurodollar Loan shall, upon the happening of such event, forthwith be suspended for the duration of such illegality, and such Lender shall by written notice to Borrower and Agent declare that its commitment with respect to such Eurodollar Loan has been so suspended and, if and when such illegality ceases to exist, such suspension shall cease and such Lender shall similarly notify Borrower and Agent. If any such change shall make it unlawful for any Lender to continue in effect the funding in the applicable Eurodollar market of any Eurodollar Loan previously made by it hereunder, such Lender shall, upon the happening of such event, notify Borrower, Agent and the other Lenders thereof in writing stating the reasons therefor, and Borrower shall, on the earlier of (a) the last day of the then current Interest Period or (b) if required by such law, regulation or interpretation, on such date as shall be specified in such notice, either convert such
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Eurodollar Loan (if a Eurodollar Loan) to a Base Rate Loan or prepay such Eurodollar Loan to the Lenders in full. Any such prepayment or conversion shall be subject to the prepayment fees described in Section 2.04 hereof.
Section 3.06 Funding. Each Lender may, but shall not be required to, make Eurodollar Loans hereunder with funds obtained outside the United States or such Loans may be made through a branch or affiliate of any Lender.
Section 3.07 Capital Adequacy. If any Lender shall have determined, after the Effective Date, that a Change in Law affecting such Lender or any lending office of such Lender, if any, regarding capital adequacy or liquidity requirements (whether or not having the force of law), has or will have the effect of reducing the rate of return on such Lenders capital as a consequence of its obligations hereunder to a level below that which such Lender could have achieved but for such Change in Law (taking into consideration such Lenders policies or the policies of its holding company with respect to capital adequacy) by an amount deemed by such Lender to be material, then from time to time, within fifteen (15) days after demand by such Lender (made within one hundred eighty (180) days of such Lender becoming aware of the reason giving rise to such demand), with a copy to Agent, Borrower shall pay to such Lender such additional amount or amounts as shall compensate such Lender for such reduction. Each Lender shall designate a different lending office if such designation will avoid the need for, or reduce the amount of, such compensation and will not, in the judgment of such Lender, be otherwise disadvantageous to such Lender. A certificate of any Lender claiming compensation under this Section and setting forth the additional amount or amounts to be paid to it hereunder shall be conclusive in the absence of manifest error. In determining such amount, such Lender may use any reasonable averaging and attribution methods. Failure on the part of any Lender to demand compensation for any reduction in return on capital with respect to any period shall not constitute a waiver of such Lenders rights to demand compensation for any reduction in return on capital in such period or in any other period. The protection of this Section 3.07 shall be available to each Lender regardless of any possible contention of the invalidity or inapplicability of the law, regulation or other condition that shall have been imposed.
Section 3.08 Application of Provisions. Notwithstanding anything in this Agreement to the contrary, no Lender shall demand compensation for any reduction referred to in Section 3.01, Section 3.02, Section 3.03 or Section 3.07 hereof if it shall not at the time be the general policy or practice of such Lender to demand such compensation, payment or reimbursement in similar circumstances under comparable provisions of other credit agreements.
Section 3.09 Replacement of Lenders. If any Lender requests compensation under Section 3.01 or Section 3.07, or if Borrower is required to pay any Indemnified Taxes or pay additional amounts to any Lender or any Governmental Authority for the account of any Lender pursuant to Section 3.02 or if any Lender is a Non-Consenting Lender or if any Lender is a Defaulting Lender, then Borrower may, at its sole expense and effort, upon notice to such Lender and the Agent, require such Lender to assign and delegate, without recourse (in accordance with and subject to the restrictions contained in, and consents required by, Section 10.10), all of its interests, rights (other than its existing rights to payments pursuant to Section 3.01, Section 3.07 or Section 3.02) and obligations under this Agreement and the related Loan Documents to an Eligible Assignee that shall assume such obligations (which assignee may be another Lender, if a Lender accepts such assignment); provided that:
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(i) Borrower shall have paid to the Agent the assignment fee (if any) specified in Section 10.10;
(ii) such Lender shall have received payment of an amount equal to the outstanding principal of its Loans accrued interest thereon, accrued fees and all other amounts payable to it hereunder and under the other Loan Documents (including any amounts under Section 3.04) from the assignee (to the extent of such outstanding principal and accrued interest and fees) or Borrower (in the case of all other amounts);
(iii) in the case of any such assignment resulting from a claim for compensation under Section 3.01, Section 3.07 or payments required to be made pursuant to Section 3.02, such assignment will result in a reduction in such compensation or payments thereafter;
(iv) such assignment does not conflict with applicable law; and
(v) in the case of any assignment resulting from a Lender becoming a Non-Consenting Lender or a Defaulting Lender, the applicable assignee shall have consented to the applicable amendment, waiver or consent.
A Lender shall not be required to make any such assignment or delegation if, prior thereto, as a result of a waiver by such Lender or otherwise, the circumstances entitling Borrower to require such assignment and delegation cease to apply.
ARTICLE IV
CONDITIONS PRECEDENT
Section 4.01 Conditions to Effective Date. The effectiveness of this Agreement (but not the obligation of the Lenders to make the Loans) is subject to Borrower satisfying each of the following conditions on or before the Effective Date, each in form and substance reasonably satisfactory to Agent:
(a) Loan Documents. Borrower shall have executed and delivered to (i) Agent, this Agreement, and each of the Loan Documents, and (ii) each Lender, its Notes.
(b) Officers Certificate, Resolutions, Organizational Documents. Borrower shall have delivered to Agent and each Lender an officers certificate certifying the names of the officers of Borrower authorized to sign the Loan Documents, together with the true signatures of such officers and certified copies of (a) the resolutions of the board of directors of Borrower evidencing authorization of the transactions contemplated by the Loan Documents, and (b) the Organizational Documents of Borrower.
(c) Legal Opinion. Borrower shall have delivered to Agent an opinion of counsel for Borrower dated the Effective Date.
(d) Good Standing Certificate. Borrower shall have delivered to Agent a good standing certificate, issued on or about the Effective Date by the Secretary of State of Ohio.
(e) Financial Statements. To the extent received by the Borrower and not previously delivered to the Agent and the Lenders, Borrower shall have delivered to Agent and
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the Lenders all interim fiscal quarterly financials for the current fiscal year (including the most recent fiscal quarter ending prior to the Effective Date) for the Closing Date Target.
(f) Fee Letter; Legal Fees. Borrower shall have (a) paid to PNC Capital Markets, for its sole benefit, the fees described in the Fee Letter on the Effective Date (to the extent required to be paid on the Effective Date) and complied in all respects with the terms of the Fee Letter, and (b) paid all legal fees and expenses of Agent and PNC Capital Markets in connection with the preparation and negotiation of the Loan Documents incurred through the Effective Date on the Effective Date.
(g) Effectiveness Certificate. Borrower shall have delivered to Agent and the Lenders a certificate from an Authorized Officer of Borrower certifying that:
(i) no Event of Default exists as of the Effective Date;
(ii) each of the representations and warranties contained in Article VI hereof and in the other Loan Documents are true and correct as of the Effective Date in all material respects (except such representations and warranties that are qualified by materiality, which shall be true and correct in all respects) (except to the extent that any such representations and warranties relates to an earlier date or period, in which case such representations and warranties shall have been true and correct in all material respects on and as of such earlier date or period (except such representations and warranties that are qualified by materiality, which shall be true and correct in all respects on and as of such earlier date or period));
(iii) no change, occurrence or development shall have occurred since October 31, 2016, that has had or could reasonably be expected to have a material adverse effect on the business, operations, property or condition (financial or otherwise) of Borrower and its Subsidiaries taken as a whole; and
(iv) as of the last day of the fiscal quarter of Borrower most recently ending prior to the Effective Date (after giving pro forma effect to the Transactions and the incurrence and repayment of Indebtedness related thereto), the Borrower is in pro forma compliance with Section 5.04 and is in pro forma compliance with all financial covenants set forth in the Borrowers Material Indebtedness Agreements (which certificate shall attach calculations evidencing such pro forma compliance).
(h) Solvency. Borrower shall have delivered to Agent and the Lenders a Solvency Certificate (after giving pro forma effect to the Transactions to occur on the Effective Date).
(i) Material Adverse Change. No change, occurrence or development shall have occurred or become known to the Agent or the Lead Arranger since October 31, 2016, that has had or could reasonably be expected to have a material adverse effect on the business, operations, property or condition (financial or otherwise) of Borrower and its Subsidiaries taken as a whole.
(j) No Event of Default; Representations and Warranties. (i) No Event of Default exists as of the Effective Date and (ii) each of the representations and warranties contained in Article VI hereof and in the other Loan Documents are true and correct as of the Effective Date in all material respects (except such representations and warranties that are
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qualified by materiality, which shall be true and correct in all respects) (except to the extent that any such representations and warranties relates to an earlier date or period, in which case such representations and warranties shall have been true and correct in all material respects on and as of such earlier date or period (except such representations and warranties that are qualified by materiality, which shall be true and correct in all respects on and as of such earlier date or period)).
(k) Closing Date Acquisition Documents. The Closing Date Acquisition Documents shall be in full force and effect, and the Agent and the Lead Arranger shall have received a true, correct and fully executed copy of the Closing Date Acquisition Documents certified by an Authorized Officer of the Borrower to be true, correct and complete.
(l) USA Patriot Act and Know Your Customer. The Borrower and each of the other Loan Parties shall have provided to the Agent and the Lenders the documentation and other information requested by the Agent or any Lender in order to comply with requirements of the USA Patriot Act, applicable know your customer and anti-money laundering rules and regulations.
Section 4.02 Conditions to Closing Date. The obligation of the Lenders to make the Loans is subject to Borrower satisfying each of the following conditions on or before the Closing Date, each in form and substance reasonably satisfactory to Agent:
(a) Financial Statements. Borrower shall have delivered to Agent and the Lenders (i) to the extent available and not previously made available to the Agent and the Lenders, interim quarterly financials for the then current fiscal year (including the most recent fiscal quarter ending prior to the Closing Date) for the Borrower (the Updated Borrower Financial Statements) and (ii) to the extent received by the Borrower and not previously delivered to Agent and the Lenders, interim quarterly financials for the current fiscal year (including the most recent fiscal quarter ending prior to the Closing Date) for the Closing Date Target (the Updated Closing Date Target Financial Statements);
(b) Updated Pro Forma Projections. Borrower shall have delivered to Agent and the Lenders, to the extent (i) reasonably requested by the Agent and (ii) Updated Borrower Financial Statements or Updated Closing Date Target Financial Statements are available or any other material financial information regarding the Closing Date Target are provided to the Borrower, updated pro forma projections of the Borrower, its Subsidiaries and the Closing Date Target (including a pro forma closing balance sheet, pro forma projected balance sheets, and pro forma statements of operations and cash flow) for the years 2017 through 2022 including assumptions used in preparing the forecast financial statements.
(c) Fee Letter; Legal Fees. Borrower shall have (a) paid to Agent, for its sole benefit and for the benefit of the Lenders, as applicable, the fees described in the Fee Letter on the Closing Date and complied in all respects with the terms of the Fee Letter, (b) paid to PNC Capital Markets, for its sole benefit, the fees described in the Fee Letter on the Closing Date (to the extent required to be paid on the Closing Date), and (c) paid all legal fees and expenses of Agent and PNC Capital Markets in connection with the preparation and negotiation of the Loan Documents incurred from the Effective Date through the Closing Date on the Closing Date.
(d) Closing Certificate. Borrower shall have delivered to Agent and the Lenders a certificate from an Authorized Officer of Borrower certifying that:
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(i) no Event of Default exists, nor immediately after the making of the Loans will exist, as of the Closing Date;
(ii) each of the representations and warranties contained in Article VI hereof and in the other Loan Documents are true and correct as of the Closing Date in all material respects (except such representations and warranties that are qualified by materiality, which shall be true and correct in all respects) (except to the extent that any such representations and warranties relates to an earlier date or period, in which case such representations and warranties shall have been true and correct in all material respects on and as of such earlier date or period (except such representations and warranties that are qualified by materiality, which shall be true and correct in all respects on and as of such earlier date or period)); provided that the accuracy of such representations and warranties with respect to the Closing Date Target shall not be a condition to the availability of the Loans on the Closing Date;
(iii) each of the Specified Acquisition Agreement Representations are true and correct to the extent provided in the Closing Date Acquisition Documents;
(iv) no change, occurrence or development shall have occurred since October 31, 2016, that has had or could reasonably be expected to have a material adverse effect on the business, operations, property or condition (financial or otherwise) of Borrower and its Subsidiaries taken as a whole;
(vi) all regulatory approvals and licenses from Governmental Authorities necessary for the funding of the Loans on the Closing Date have been completed and there is an absence of any legal or regulatory prohibitions or restrictions from Governmental Authorities with respect thereto;
(vii) there are no material actions, suits, investigations or proceedings pending or, to the knowledge of Borrower, threatened, in any court or before any arbitrator that could reasonably be expected to have a material adverse effect on (1) the ability of Borrower to comply with its obligations under the Loan Documents or (2) the funding of the Loans on the Closing Date;
(viii) the officers certificate (and such attachments thereto) delivered in accordance with Section 4.01(b) has not been amended, modified or rescinded since the Effective Date and is in full force and effect;
(viii) the Closing Date Acquisition has been consummated simultaneously (or substantially simultaneously or concurrently) with the funding of the Loans on the Closing Date, and in accordance with applicable law and the terms described in the Closing Date Acquisition Documents, in each case, in all material respects after giving effect to any amendments, modifications, waivers or consents to the Closing Date Acquisition Documents, other than those amendments, modifications, waivers or consents to any of the Specified Acquisition Agreement Representations that, individually or in the aggregate, is materially adverse to the Agent or the Lenders without the Agents and the Lenders prior written consent (it being understood and agreed that any material amendment, modification, waiver or consent to any Specified Acquisition Agreement Representations relating to due organization, Investment Company Act, anti-terrorism laws, money laundering activities, dealing with embargoed persons, Material Adverse Effect, absence of material litigation with respect to the consummation of the Closing Date Acquisition, regulatory approvals and licenses necessary for the consummation of the
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Closing Date Acquisition and absence of any legal or regulatory prohibitions or restrictions with respect to the Closing Date Acquisition, in each case, shall require the Agents and the Lenders prior written consent); and
(ix) as of the last day of the fiscal quarter of Borrower most recently ending prior to the Closing Date (after giving pro forma effect to the Transactions and the incurrence and repayment of Indebtedness related thereto), the Borrower is in pro forma compliance with Section 5.04 and is in pro forma compliance with all financial covenants set forth in the Borrowers Material Indebtedness Agreements (which certificate shall attach calculations evidencing such pro forma compliance).
(e) Solvency. Borrower shall have delivered to Agent and the Lenders a Solvency Certificate (after giving pro forma effect to the Transactions to occur on the Closing Date).
(f) Absence of Litigation. No legal or regulatory prohibitions shall exist which prevent the funding of the Loans on the Closing Date. There shall not be any material action, suit, investigation or proceeding pending or, to the knowledge of Borrower, threatened, in any court or before any arbitrator that could reasonably be expected to have a material adverse effect on (i) the ability of Borrower to comply with its obligations under the Loan Documents or (ii) the funding of the Loans on the Closing Date.
(g) Specified Acquisition Agreement Representations. Each of the Specified Acquisition Agreement Representations shall be true and correct to the extent provided in the Closing Date Acquisition Documents.
(h) No Event of Default; Representations and Warranties. (i) No Event of Default exists, nor immediately after the making of the Loans will exist, as of the Closing Date and (ii) Each of the representations and warranties contained in Article VI hereof and in the other Loan Documents are true and correct as of the Closing Date in all material respects (except such representations and warranties that are qualified by materiality, which shall be true and correct in all respects) (except to the extent that any such representations and warranties relates to an earlier date or period, in which case such representations and warranties shall have been true and correct in all material respects on and as of such earlier date or period (except such representations and warranties that are qualified by materiality, which shall be true and correct in all respects on and as of such earlier date or period)); provided that the accuracy of such representations and warranties with respect to the Closing Date Target shall not be a condition to the availability of the Loans on the Closing Date;
(i) Material Adverse Change. No change, occurrence or development shall have occurred or become known to the Agent or the Lead Arranger since October 31, 2016, that has had or could reasonably be expected to have a material adverse effect on the business, operations, property or condition (financial or otherwise) of Borrower and its Subsidiaries taken as a whole.
(j) Closing Date Acquisition. The Closing Date Acquisition shall have been consummated simultaneously (or substantially simultaneously or concurrently) with the funding of the Loans on the Closing Date, and in accordance with applicable law and the terms described in the Closing Date Acquisition Documents, in each case, in all material respects after giving effect to any amendments, modifications, waivers or consents to the Closing Date Acquisition
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Documents, other than those amendments, modifications, waivers or consents to any of the Specified Acquisition Agreement Representations that, individually or in the aggregate, is materially adverse to the Agent or the Lenders without the Agents and the Lenders prior written consent (it being understood and agreed that any material amendment, modification, waiver or consent to any Specified Acquisition Agreement Representations relating to due organization, Investment Company Act, anti-terrorism laws, money laundering activities, dealing with embargoed persons, Material Adverse Effect, absence of material litigation with respect to the consummation of the Closing Date Acquisition, regulatory approvals and licenses necessary for the consummation of the Closing Date Acquisition and absence of any legal or regulatory prohibitions or restrictions with respect to the Closing Date Acquisition, in each case, shall require the Agents and the Lenders prior written consent).
(k) Existing Closing Date Target Indebtedness. Borrower shall have delivered to Agent evidence (including customary payoff letters) that all Existing Closing Date Target Indebtedness (other than Indebtedness permitted pursuant to Section 5.05) has been, or concurrently with the funding of the Loans will be, repaid in full, all commitments thereunder have been, or concurrently with the funding of the Loans will be, terminated, and all Liens securing obligations thereunder have been, or substantially concurrently with the funding of the Loans will be or are being, released (other than Liens permitted pursuant to Section 5.06).
(l) Notice of Loans. Borrower shall have delivered to Agent an executed Notice of Loans with respect to the Loans to be funded on the Closing Date.
(m) Funds Flow. Borrower shall have delivered to Agent an executed funds flow statement with respect to all Loans to be advanced on the Closing Date and all other Transactions to occur on the Closing Date.
(n) USA Patriot Act and Know Your Customer. The Borrower and each of the other Loan Parties shall have provided to the Agent and the Lenders the documentation and other information requested by the Agent or any Lender in order to comply with requirements of the USA Patriot Act, applicable know your customer and anti-money laundering rules and regulations.
Notwithstanding anything to the contrary herein, if the Closing Date shall not occur on or prior to June 30, 2017, then the Lenders Commitments hereunder shall expire and the Lenders shall have no obligation to the Borrower or any other Loan Party under this Agreement or any other Loan Document (including, without limitation, to make Loans hereunder), and this Agreement and the other Loan Documents shall be deemed terminated (other than with respect to provisions that survive termination thereof).
ARTICLE V
COVENANTS
Borrower agrees that, from and after the Effective Date until all of the Debt shall have been paid in full, Borrower shall perform and observe, and shall cause each other Company to perform and observe, each of the following provisions:
Section 5.01 Financial Statements. Borrower covenants that it will deliver to each Lender:
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(a) within forty-five (45) days after the end of each of the first three (3) quarter-annual periods of each fiscal year of Borrower, balance sheets of Borrower as of the end of such period and statements of income (loss), stockholders equity and cash flow for the quarter and fiscal year to date periods, all prepared on a Consolidated basis, in accordance with GAAP and in form and detail satisfactory to the Required Lenders and certified by a Financial Officer of Borrower;
(b) within ninety (90) days after the end of each fiscal year of Borrower, (i) an annual audit report of Borrower for that year prepared on a Consolidated and consolidating (but only as to Borrower and its Subsidiaries) basis, in accordance with GAAP, and in form and detail satisfactory to the Required Lenders and certified by an independent public accountant satisfactory to the Required Lenders, which report shall include balance sheets and statements of income (loss), stockholders equity and cash-flow for that period, provided that delivery of Borrowers annual report for any fiscal year of Borrower on Form 10-K as filed with the SEC shall satisfy the requirements of this subpart (b)(i), and (ii) a certificate by such accountant setting forth the Defaults and Events of Default coming to its attention during the course of its audit or, if none, a statement to that effect;
(c) concurrently with the delivery of the financial statements in (a) and (b) above, a Compliance Certificate;
(d) as soon as available, copies of all notices, reports, definitive proxy statements and other documents that are publicly available and sent by Borrower to its shareholders, to the holders of any of its debentures or bonds or the trustee of any indenture securing the same or pursuant to which they are issued, or sent by Borrower (in final form) to any securities exchange or over the counter authority or system, or to the SEC or any similar federal agency having regulatory jurisdiction over the issuance of Borrowers securities; provided that publication of any of the foregoing items with the SEC shall satisfy the requirements of this subpart (d);
(e) within ten (10) days after receipt thereof by Borrower or any Subsidiary thereof, copies of all material notices, requests and other documents (including amendments, waivers and other modifications) so received under or pursuant to any Closing Date Acquisition Document; and
(f) within ten (10) days of the written request of Agent or any Lender (with such request being made through Agent), such other information about the financial condition, properties and operations of any Company as Agent may from time to time reasonably request (but subject to any applicable law and, upon request of Borrower, subject to customary confidentiality provisions), which information shall be submitted in form and detail satisfactory to Agent and certified by a Financial Officer of the Company or Companies in question.
Documents required to be delivered pursuant to Section 5.01(a) or (b) (to the extent that any such documents are included in materials otherwise filed with the SEC) may be delivered electronically and if so delivered, shall be deemed to have been delivered on the date (i) on which Borrower posts such documents, or provides a link thereto on Borrowers website on the Internet at the website address; or (ii) on which such documents are posted on Borrowers behalf on an Internet website, if any, to which each Lender and the Agent have access (whether a commercial, third-party website or whether sponsored by the Agent); provided that: (i) Borrower shall deliver paper copies of such documents to the Agent or any Lender that requests Borrower
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to deliver such paper copies until a written request to cease delivering paper copies is given by the Agent or such Lender and (ii) Borrower shall notify the Agent and each Lender (by telecopier or electronic mail) of the posting of any such documents and provide to the Agent by electronic mail electronic versions (i.e., soft copies) of such documents.
Section 5.02 Franchises. Borrower will and shall cause each of its Subsidiaries to preserve and maintain at all times its existence, rights and franchises, except as otherwise permitted pursuant to Section 5.07 hereof; provided that Borrower shall not be required to preserve or maintain such rights or franchises where the failure to do so will not have a Material Adverse Effect.
Section 5.03 ERISA Compliance. None of Borrower or its Subsidiaries shall incur any material accumulated funding deficiency within the meaning of ERISA, or any material liability to the PBGC, established thereunder in connection with any ERISA Plan. Borrower shall promptly notify each Agent of any material taxes assessed, proposed to be assessed or that Borrower has reason to believe may be assessed against Borrower or any of its Subsidiaries by the Internal Revenue Service with respect to any ERISA Plan. As used in this Section material means the measure of a matter of significance that shall be determined as being an amount equal to five percent (5%) of the Consolidated Total Assets of Borrower.
Section 5.04 Financial Covenants.
(a) Leverage Ratio. Borrower covenants that it shall not suffer or permit the Leverage Ratio to exceed (i) during any Leverage Ratio Step-Up Period, 3.75 to 1.00 and (ii) at all other times, 3.50 to 1.00.
(b) Interest Coverage Ratio. Borrower covenants that it shall not suffer or permit the Interest Coverage Ratio to be less than 3.00 to 1.00.
Section 5.05 Indebtedness. Borrower covenants that it will not and shall not permit any of its Subsidiaries to create, incur or have outstanding any Indebtedness of any kind; provided, that this Section 5.05 shall not apply to:
(a) Loans or any Indebtedness under this Agreement;
(b) the unsecured Indebtedness under the February 20, 2015 Credit Agreement in an aggregate principal amount not to exceed Eight Hundred Fifty Million Dollars ($850,000,000);
(c) the unsecured Indebtedness of Borrower under the 2016 NYLIM Note Purchase Agreement in an aggregate principal amount not to exceed Two Hundred Million Dollars ($200,000,000);
(d) the unsecured Indebtedness under the 2012 Senior Notes Purchase Agreement in an aggregate amount not to exceed Two Hundred Million Dollars ($200,000,000);
(e) the unsecured Indebtedness under the Nordson Holdings S.a.r.l-BAML Credit Agreement in an aggregate amount not to exceed of One Hundred Ten Million Euros (110,000,000);
(f) [reserved];
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(g) the unsecured Indebtedness of Borrower under the 2015 Note Purchase Agreement in an aggregate amount not to exceed One Hundred Million Dollars ($100,000,000);
(h) the unsecured Indebtedness under the April 10, 2015 Credit Agreement in an aggregate principal amount not to exceed Two Hundred Million Dollars ($200,000,000);
(i) the unsecured Indebtedness of Borrower owing to The Lender of Tokyo-Mitsubishi UFJ, Ltd. up to the Dollar Equivalent of One Billion Japanese Yen (¥1,000,000,000);
(j) loans or capital leases to Borrower or any of its Subsidiaries for the purchase or lease of fixed assets, which loans or leases are secured by the assets being purchased or leased, so long as the aggregate then outstanding principal amount of all such loans and leases for Borrower and its Subsidiaries do not exceed the greater of (a) One Hundred Million Dollars ($100,000,000) and (b) an amount equal to five percent (5%) of Consolidated Total Assets at any time;
(k) Indebtedness owed by Borrower or a Subsidiary (other than the Receivables Subsidiary) to Borrower or another Subsidiary (other than the Receivables Subsidiary);
(l) Indebtedness of the Receivables Subsidiary under the Permitted Receivables Facility, so long as (a) the funded amount, together with any other Indebtedness thereunder, does not exceed the greater of (1) Two Hundred Million Dollars ($200,000,000) and (2) an amount equal to ten percent (10%) of Consolidated Total Assets at any time, and (b) Borrower provides a copy of the documents evidencing such transaction to the Agent;
(m) Indebtedness constituting Guaranty Obligations permitted by Section 5.15; and
(n) additional Indebtedness of Borrower or any Subsidiary, to the extent not otherwise permitted pursuant to any of the foregoing clauses of this Section 5.05, so long as (i) Borrower will be in pro forma compliance as of the applicable measurement period with Section 5.04 hereof after giving effect to the incurrence of such Indebtedness, (ii) no Event of Default shall exist prior to or after giving effect to the incurrence of any such Indebtedness and (iii) after giving effect to the incurrence of such Indebtedness by any Subsidiary, the amount of outstanding Priority Indebtedness does not exceed an amount equal to twenty percent (20%) of Consolidated Total Assets.
Section 5.06 Liens. Borrower covenants and warrants that it will not, and will not permit any Subsidiary to create, assume or suffer to exist any Lien upon any of its property or assets, whether now owned or hereafter acquired; provided that this Section 5.06 shall not apply to the following:
(a) Liens for taxes not yet due or that are being actively contested in good faith by appropriate proceedings and for which adequate reserves have been established in accordance with GAAP;
(b) other statutory Liens incidental to the conduct of its business or the ownership of its property and assets that (a) were not incurred in connection with the borrowing of money or the obtaining of advances or credit, and (b) do not in the aggregate materially
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detract from the value of its property or assets or materially impair the use thereof in the operation of its business;
(c) easements or other minor defects or irregularities in title of real property not interfering in any material respect with the use of such property in the business of Borrower or any of its Subsidiaries;
(d) any Lien granted to Agent, for the benefit of the Lenders;
(e) Liens on fixed assets securing the loans or capital leases pursuant to Section 5.05(j) hereof, provided that such Lien only attaches to the property being acquired or leased plus any such Liens existing on the date hereof;
(f) Liens on the Receivables Related Assets in connection with the Permitted Receivables Facility securing the obligations under the Permitted Receivables Facility; and
(g) any other Liens, to the extent not otherwise permitted pursuant to clauses (a) through (f) hereof, so long as the aggregate then outstanding amount of Priority Indebtedness does not exceed at any time, for Borrower and all Subsidiaries, an amount equal to twenty percent (20%) of Consolidated Total Assets.
Borrower shall not, and shall not permit any Subsidiary (other than the Receivables Subsidiary) to, enter into any Material Indebtedness Agreement (other than any contract or agreement entered into in connection with the Indebtedness permitted to be incurred pursuant to clauses (b), (c), (d), (e), (g), (h), (i), (j) (but only with respect to the assets the subject thereof), (m) or (n) of Section 5.05 hereof) that would prohibit Agent or the Lenders from acquiring a security interest, mortgage or other Lien on, or a collateral assignment of, any of the property or assets of Borrower or any of Subsidiaries.
Section 5.07 Merger and Sale of Assets. Borrower covenants that it will not, and will not permit any Subsidiary to, merge or consolidate with any other Person, or sell, lease or transfer or otherwise dispose of any assets to any Person other than in the ordinary course of business, except that, if no Default or Event of Default shall then exist or immediately thereafter shall begin to exist:
(a) any Subsidiary (other than the Receivables Subsidiary) may merge with Borrower (provided that Borrower shall be the continuing or surviving Person), or (b) any other Subsidiary (other than the Receivables Subsidiary);
(b) Borrower may sell, lease, transfer or otherwise dispose of any of its assets to any Subsidiary (other than the Receivables Subsidiary) and any Subsidiary (other than the Receivables Subsidiary) may sell, lease, transfer or otherwise dispose of any of its assets to (a) Borrower, or (b) any Subsidiary (other than the Receivables Subsidiary);
(c) in addition to any sale, lease, transfer or other disposition permitted pursuant to clauses (a) and (b) above, Borrower and any Subsidiary may sell accounts receivables and related rights to the Receivables Subsidiary in connection with the Permitted Receivables Facility;
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(d) any merger or consolidation that constitutes an Acquisition permitted pursuant to Section 5.08 hereof; and
(e) in addition to any sale, lease, transfer or other disposition permitted pursuant to clauses (a) through (d) above, Borrower or any Subsidiary (other than the Receivables Subsidiary) may sell, lease, transfer or otherwise dispose of any of its assets to any Person so long as the aggregate amount of all such assets sold, leased, transferred or otherwise disposed of by Borrower and all of its Subsidiaries does not exceed an amount equal to eleven percent (11.0%) of Consolidated Total Assets during any two consecutive fiscal years of Borrower.
Section 5.08 Acquisitions. Borrower covenants that it will not, and will not permit any Subsidiary to, effect an Acquisition, except that Borrower or any Subsidiary (other than the Receivables Subsidiary) may effect the Closing Date Acquisition pursuant to the terms hereof and any other Acquisition provided that with respect to Acquisitions other than the Closing Date Acquisition (a) if such Acquisition is a merger or consolidation with Borrower, Borrower shall be the surviving entity and if such Acquisition is a merger or consolidation with a Subsidiary, then the surviving entity shall be a Subsidiary on the consummation thereof; (b) the Board of Directors (or equivalent governing body) of the Person acquired shall have approved such Acquisition; and (c) no Default or Event of Default shall then exist or immediately thereafter shall begin to exist.
Section 5.09 Regulations U and X. No Company shall take any actions that would result in any non-compliance of the Loans with Regulations U and X, or any other applicable regulation, of the Board of Governors of the Federal Reserve System.
Section 5.10 Notice. Borrower covenants that it will promptly notify the Agent and the Lenders whenever, to the knowledge of a Financial Officer (a) any Default or Event of Default has occurred or is likely to occur hereunder, or (b) any default, or event with which the passage of time or the giving of notice, or both, would cause a default, shall have occurred under any Material Indebtedness Agreement (including, without limitation, the Note Purchase Agreements and the Existing Credit Agreements so long as each is a Material Indebtedness Agreement).
Section 5.11 Environmental Compliance. Except where the failure to do so would not have or result in a Material Adverse Effect, Borrower covenants that it will, and shall cause each Subsidiary to, (i) comply in all respects with any and all Environmental Laws including, without limitation, all Environmental Laws in jurisdictions in which Borrower or any Subsidiary owns or operates a facility or site, arranges for disposal or treatment of hazardous substances, solid waste or other wastes, accepts for transport any hazardous substances, solid waste or other wastes or holds any interest in real property or otherwise and (ii) not allow the release or disposal of hazardous waste, solid waste or other wastes on, under or to any real property in which Borrower or any of its Subsidiaries holds any interest or performs any of its operations, in violation of any Environmental Law. Borrower shall defend, indemnify and hold the Agent and the Lenders harmless against all costs, expenses, claims, damages, penalties and liabilities of every kind or nature whatsoever (including attorneys fees) arising out of or resulting from the noncompliance of Borrower or any of its Subsidiaries with any Environmental Law. Such indemnification shall survive any termination of this Agreement.
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Section 5.12 Restricted Payments. Borrower covenants that it will not make or commit itself to make any Restricted Payment if an Event of Default shall then exist or immediately thereafter shall begin to exist.
Section 5.13 Use of Proceeds. Borrowers use of the proceeds of the Loans shall be solely for (a) funding of the Closing Date Acquisition, (b) refinancing of Existing Closing Date Target Indebtedness, (c) the payment of fees and expenses incurred in connection with the Transactions and (d) to the extent of any portion of the Loans remaining after giving effect to the items specified in the foregoing clauses (a) through (c), working capital and other general corporate purposes of Borrower and its Subsidiaries. Borrower covenants that it will not request any borrowing, and Borrower shall not use, and shall procure that its Subsidiaries and its or their respective directors, officers, employees and agents shall not use, the proceeds of any borrowing (i) in furtherance of an offer, payment, promise to pay, or authorization of the payment or giving of money, or anything else of value, to any Person in violation of any Anti-Corruption Laws, (ii) for the purpose of funding, financing or facilitating any activities, business or transaction of or with any Sanctioned Person, or in any Sanctioned Country, or (iii) in any manner that would result in the violation of any Sanctions applicable to any party hereto.
Section 5.14 Restrictive Agreements. Except as set forth in this Agreement, Borrower covenants that it will not, and will not permit any Subsidiary (excluding the Receivable Subsidiary) to, directly or indirectly, create or otherwise cause or suffer to exist or become effective any encumbrance or restriction on the ability of any Subsidiary (excluding the Receivables Subsidiary) to (a) make, directly or indirectly, any Capital Distribution to Borrower; (b) make, directly or indirectly, loans or advances or capital contributions to Borrower; or (c) transfer, directly or indirectly, any of the properties or assets of such Subsidiary (excluding the Receivables Subsidiary) to Borrower, except for such encumbrances or restrictions existing under or by reason of (1) applicable law, (2) customary non-assignment provisions in leases or other agreements entered in the ordinary course of business and consistent with past practices, (3) customary restrictions in security agreements or mortgages securing Indebtedness of Borrower or its Subsidiaries to the extent such restrictions only restrict the transfer of the property subject to Liens under such security agreement or mortgage which are permitted under Section 5.06 or (4) customary and reasonable restrictions in agreements necessary to obtain loans and credit facilities so long as such restrictions do not materially encumber the ability of the Subsidiaries taken as a whole to make Capital Distributions.
Section 5.15 Guaranties of Payment; Guaranty Under Material Indebtedness Agreement. Borrower covenants that it will not permit any Subsidiary to become a Guarantor in respect of any Indebtedness under a Material Indebtedness Agreement (including, without limitation, the Existing Credit Agreements or the Note Purchase Agreements, so long as each is a Material Indebtedness Agreement) unless, prior to or concurrently therewith (i) Borrower shall have caused each such Subsidiary to execute and deliver to the Agent and the Lenders a Guaranty of Payment, in form and substance substantially similar to form of guaranty furnished under such Material Indebtedness Agreement and otherwise completed in a manner satisfactory to the Agent, accompanied by a certificate of the Secretary or Assistant Secretary of such Subsidiary certifying such Subsidiarys charter and by-laws (or comparable governing documents), resolutions of the board of directors (or comparable governing body) of such Subsidiary authorizing the execution and delivery of such Guaranty of Payment and incumbency and specimen signatures of the officers of such Subsidiary executing such documents and (ii) if any holder of any Indebtedness under the Material Indebtedness Agreement shall be or become a
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party to an intercreditor agreement with any other holder of any Indebtedness under any other Material Indebtedness Agreement, then all holders of Indebtedness under any other Material Indebtedness Agreement with respect to which any Subsidiary is a Guarantor shall enter into an intercreditor agreement in form and substance customary and appropriate for such agreement and otherwise reasonably satisfactory to the Agent.
Section 5.16 Pari Passu Ranking. Borrower covenants that its obligations under this Agreement shall, and that it will, and will cause each Subsidiary to, take all necessary action to ensure that the obligations of Borrower under this Agreement shall, at all times rank at least pari passu in right of payment (to the fullest extent permitted by law) with all other senior unsecured Indebtedness of Borrower and its Subsidiaries.
Section 5.17 Terrorism Sanctions Regulations and Compliance with Laws. Borrower covenants that it will not, and will not permit any Subsidiary to, (i) become a Person described or designated in the Specially Designated Nationals and Blocked Persons List of the Office of Foreign Assets Control or in Section 1 of the Anti Terrorism Order or (ii) be in violation of any law, regulation, or list of any government agency (including, without limitation, the U.S. Office of Foreign Asset Control list, Executive Order No. 13224 or the USA Patriot Act) that prohibits or limits the conduct of business with or the receiving of funds, goods or services to or for the benefit of certain Persons specified therein or that prohibits or limits any Lender from making Loans hereunder to Borrower or from otherwise conducting business with Borrower or any Subsidiaries. Borrower covenants that it will maintain in effect and enforce policies and procedures designed to ensure compliance by Borrower, its Subsidiaries and their respective directors, officers, employees and agents with applicable Anti-Corruption Laws and applicable Sanctions.
Section 5.18 Changes in Closing Date Acquisition Documents. Borrower covenants that it will not, and shall not permit any Subsidiary to, amend or modify any provisions of the Closing Date Acquisition Documents that would have a Material Adverse Effect.
ARTICLE VI
REPRESENTATIONS AND WARRANTIES
Borrower solely as to itself and, to the extent set forth below, on behalf of each of its Subsidiaries represents and warrants that the statements set forth in this Article VI are true, correct and complete.
Section 6.01 Organization; Subsidiary Preferred Equity.
(a) Borrower is a corporation duly organized and existing in good standing under the laws of the State of Ohio, and each Subsidiary is duly organized and existing in good standing under the laws of the jurisdiction in which it is organized.
(b) Borrower and each of its Subsidiaries have duly qualified or been duly licensed, and are authorized to do business and are in good standing, in each jurisdiction in which the ownership of their respective properties or the nature of their respective businesses makes such qualification or licensing necessary and in which the failure to be so qualified or licensed could be reasonably likely to have a Material Adverse Effect. No Subsidiary has any outstanding shares of any class of capital stock or other equity interests which has priority over any other class of capital stock or other equity interests of such Subsidiary as to dividends or
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distributions or in liquidation except as may be owned beneficially and of record by Borrower or a Wholly-Owned Subsidiary. Each Subsidiarys legal name and its state or jurisdiction of organization has been set forth in Borrowers most recent annual report on Form 10-K (excluding for any Subsidiary organized or no longer in existence since the date thereof). As of the date of this Agreement, no Subsidiary is a Guarantor with respect to any Indebtedness under any Material Indebtedness Agreement.
Section 6.02 Power and Authority.
(a) Borrower and each Subsidiary has all requisite corporate, limited liability company or partnership, as the case may be, power to own or hold under lease and operate their respective properties which it purports to own or hold under lease and to conduct its business as currently conducted and as currently proposed to be conducted.
(b) Borrower has all requisite corporate power to execute, deliver and perform its obligations under this Agreement and other Loan Documents. The execution, delivery and performance of this Agreement and the other Loan Documents has been duly authorized by all requisite corporate action, and this Agreement and the other Loan Documents have been duly executed and delivered by authorized officers of Borrower and are valid obligations of Borrower, legally binding upon and enforceable against Borrower in accordance with their terms, except as such enforceability may be limited by (i) bankruptcy, insolvency, reorganization or other similar laws affecting the enforcement of creditors rights generally and (ii) general principles of equity (regardless of whether such enforceability is considered in a proceeding in equity or at law).
(c) The execution, delivery and performance of the Loan Documents will not violate any applicable law, conflict with or result in any breach in any of the provisions of, or constitute a default under, or result in the creation of any Lien (other than Liens permitted under Section 5.06 hereof) upon any assets or property of any Company under the provisions of such Companys Organizational Documents or any agreement.
Section 6.03 Compliance with Laws. Each Company:
(a) holds permits, certificates, licenses, orders, registrations, franchises, authorizations, and other approvals from federal, state, local, and foreign governmental and regulatory bodies necessary for the conduct of its business and is in compliance with all applicable laws relating thereto except where the failure to do so would not have a Material Adverse Effect;
(b) is in compliance with all federal, state, local, or foreign applicable statutes, rules, regulations, and orders including, without limitation, those relating to environmental protection, occupational safety and health, and equal employment practices, except where the failure to do so would not have a Material Adverse Effect; and
(c) is not in violation of or in default under any agreement to which it is a party or by which its assets are subject or bound, except to the extent that any such violation or default would not have a Material Adverse Effect.
Section 6.04 Litigation and Administrative Proceedings. Except as disclosed on Schedule 6.04 hereto, there are (a) no lawsuits, actions, investigations, or other proceedings pending or threatened against any Company, or in respect of which any Company may have any
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liability, in any court or before any governmental authority, arbitration board, or other tribunal, (b) no orders, writs, injunctions, judgments, or decrees of any court or government agency or instrumentality to which any Company is a party or by which the property or assets of any Company are bound, and (c) no grievances, disputes, or controversies outstanding with any union or other organization of the employees of any Company, or threats of work stoppage, strike, or pending demands for collective bargaining, in each case, individually or in the aggregate, if determined adversely, would have a Material Adverse Effect.
Section 6.05 Title to Assets. Each Company has good title to and ownership of all property it purports to own, which property is free and clear of all Liens, except those permitted under Section 5.06 hereof or which the failure to have good title would not have a Material Adverse Effect.
Section 6.06 Liens and Security Interests. On and after the Effective Date, except for Liens permitted pursuant to Section 5.06 hereof, (a) there is no financing statement outstanding covering any personal property of any Company, other than a financing statement in favor of Agent, for the benefit of the Lenders, if any; (b) there is no mortgage outstanding covering any real property of any Company, other than a mortgage in favor of Agent, for the benefit of the Lenders, if any; and (c) no real or personal property of any Company is subject to any security interest or Lien of any kind other than any security interest or Lien that may be granted to Agent, for the benefit of the Lenders. No Company (other than the Receivables Subsidiary) has entered into any contract or agreement that exists on or after the Effective Date (other than any contract or agreement entered into in connection with the Indebtedness permitted to be incurred pursuant to clauses (b), (c), (d), (e), (g), (h), (i), (j) (but only with respect to the assets the subject thereof), (m) or (n) of Section 5.05 hereof) that would prohibit Agent or the Lenders from acquiring a security interest, mortgage or other Lien on, or a collateral assignment of, any of the property or assets of any Company.
Section 6.07 Tax Returns. All foreign, federal, state and local tax returns and other reports required by law to be filed in respect of the income, business, properties and employees of each Company have been filed and all taxes, assessments, fees and other governmental charges that are due and payable have been paid, except as otherwise permitted herein or the failure to do so does not and will not cause or result in a Material Adverse Effect. The provision for taxes on the books of each Company is adequate for all years not closed by applicable statutes and for the current fiscal year.
Section 6.08 Environmental Laws. Each Company is in compliance with any and all Environmental Laws, including, without limitation, all Environmental Laws in all jurisdictions in which any Company owns or operates, or has owned or operated, a facility or site, arranges or has arranged for disposal or treatment of hazardous substances, solid waste or other wastes, accepts or has accepted for transport any hazardous substances, solid waste or other wastes or holds or has held any interest in real property or otherwise, except where the failure to so comply would not have a Material Adverse Effect. No litigation or proceeding arising under, relating to or in connection with any Environmental Law is pending or, to the best knowledge of each Company, threatened, against any Company, any real property in which any Company holds or has held an interest or any past or present operation of any Company that, if determined adversely, would have a Material Adverse Effect. No release, threatened release or disposal of hazardous waste, solid waste or other wastes is occurring, or has occurred (other than those that are currently being cleaned up in accordance with Environmental Laws), on, under or to any real property in which any Company holds any interest or performs any of its operations, in violation
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of any Environmental Law and that would have a Material Adverse Effect. As used in this Section, litigation or proceeding means any demand, claim, notice, suit, suit in equity, action, administrative action, investigation or inquiry whether brought by any governmental authority, private Person or otherwise.
Section 6.09 Employee Benefit Plans. No ERISA Event has occurred or is expected to occur with respect to an ERISA Plan. Full payment has been made of all amounts which a Controlled Group member is required, under applicable law or under the governing documents, to have been paid as a contribution to or a benefit under each ERISA Plan. The liability of each Controlled Group member with respect to each ERISA Plan has been fully funded based upon reasonable and proper actuarial assumptions, has been fully insured, or has been fully reserved for on its financial statements. No changes have occurred or are expected to occur that would cause a material increase in the cost of providing benefits under the ERISA Plan. With respect to each ERISA Plan that is intended to be qualified under Code Section 401(a): (a) the ERISA Plan and any associated trust operationally comply with the applicable requirements of Code Section 401(a), (b) the ERISA Plan and any associated trust have been amended to comply with all such requirements as currently in effect, other than those requirements for which a retroactive amendment can be made within the remedial amendment period available under Code Section 401(b) (as extended under Treasury Regulations and other Treasury pronouncements upon which taxpayers may rely), (c) the ERISA Plan and any associated trust have received a favorable determination letter from the Internal Revenue Service stating that the ERISA Plan qualifies under Code Section 401(a), that the associated trust qualifies under Code Section 501(a) and, if applicable, that any cash or deferred arrangement under the ERISA Plan qualifies under Code Section 401(k), unless the ERISA Plan was first adopted at a time for which the above-described remedial amendment period has not yet expired, (d) the ERISA Plan currently satisfies the requirements of Code Section 410(b), without regard to any retroactive amendment that may be made within the above-described remedial amendment period, and (e) no contribution made to the ERISA Plan is subject to an excise tax under Code Section 4972. With respect to any Pension Plan (except to the extent set forth in footnote 4 to Borrowers Consolidated financial statements for the fiscal year ended October 31, 2006), the accumulated benefit obligation of Controlled Group members with respect to the Pension Plan (as determined in accordance with Statement of Accounting Standards No. 87, Employers Accounting for Pensions, as applicable to Borrower from time to time) does not exceed the fair market value of Pension Plan assets.
Section 6.10 Consents or Approvals. No consent, approval or authorization of, or filing, registration or qualification with, any Governmental Authority or any other Person is required to be obtained or completed by Borrower in connection with the execution, delivery or performance of any of the Loan Documents that has not already been obtained or completed.
Section 6.11 Solvency. Borrower has received consideration that is the reasonable equivalent value of the obligations and liabilities that Borrower has incurred to the Lenders. Borrower is not insolvent as defined in any applicable state or federal statute, nor will Borrower be rendered insolvent by the execution and delivery of the Loan Documents to Agent and the Lenders. Borrower is not engaged or about to engage in any business or transaction for which the assets retained by it are or will constitute unreasonably small capital, taking into consideration the obligations to Agent and the Lenders incurred hereunder. Borrower does not intend to, nor does it believe that it will, incur debts beyond its ability to pay such debts as they mature.
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Section 6.12 Financial Statements. The Consolidated financial statements of Borrower for the fiscal years most recently ended and the fiscal quarters most recently ended that are available to the Agent and the Lenders, are true and complete, have been prepared in accordance with GAAP, and fairly present the financial condition of the Companies as of the dates of such financial statements and the results of their operations for the periods then ending.
Section 6.13 Regulations. Borrower is not engaged principally or as one of its important activities, in the business of extending credit for the purpose of purchasing or carrying any margin stock (within the meaning of Regulation U of the Board of Governors of the Federal Reserve System of the United States of America). Neither the granting of any Loan (or any conversion thereof) nor the use of the proceeds of any Loan will violate, or be inconsistent with, the provisions of Regulation U or X or any other Regulation of such Board of Governors.
Section 6.14 Investment Company; Holding Company. No Company is (a) 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) subject to regulation under the Public Utility Holding Company Act of 2005, the Federal Power Act, each as amended, or any foreign, federal, state or local statute or regulation limiting its ability to incur Indebtedness.
Section 6.15 Accurate and Complete Statements. Neither the Loan Documents nor any written statement made by any Company in connection with any of the Loan Documents contains any untrue statement of a material fact or omits a material fact necessary to make the statements contained therein or in the Loan Documents not misleading. After due inquiry by a Financial Officer of Borrower, there is no known fact that any Company has not disclosed to Agent and the Lenders that has or would have a Material Adverse Effect.
Section 6.16 Defaults. No Default or Event of Default exists hereunder, nor will any begin to exist (including, without limitation, after giving effect to the Transactions).
Section 6.17 Anti-Terrorism Law and Anti-Corruption Law Compliance. No Company is subject to or in violation of any law, regulation, or list of any government agency (including, without limitation, the U.S. Office of Foreign Asset Control list, Executive Order No. 13224 or the USA Patriot Act) that prohibits or limits the conduct of business with or the receiving of funds, goods or services to or for the benefit of certain Persons specified therein or that prohibits or limits any Lender from making any advance or extension of credit to any Company or from otherwise conducting business with any Company. Borrower has implemented and maintains in effect policies and procedures designed to ensure compliance by Borrower, its Subsidiaries and their respective directors, officers, employees and agents with applicable Anti-Corruption Laws and applicable Sanctions, and Borrower, its Subsidiaries and their respective officers and employees and to the knowledge of Borrower, its directors, officers, employees, agents, affiliate or representative thereof, are in compliance with applicable Anti-Corruption Laws and applicable Sanctions in all material respects and are not knowingly engaged in any activity that would reasonably be expected to result in Borrower being designated as a Sanctioned Person. None of (a) Borrower, any Subsidiary or to the knowledge of Borrower or such Subsidiary any of their respective directors, officers or employees, or (b) to the knowledge of Borrower, any agent of Borrower or any Subsidiary that will act in any capacity in connection with or benefit from the credit facility established hereby, is a Sanctioned Person. No Company is located, organized or resident in a Sanctioned Country. No borrowing, use of proceeds or other transaction contemplated by this Agreement will violate any applicable Anti-Corruption Law or applicable Sanctions.
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Section 6.18 EEA Financial Institutions. No Loan Party is an EEA Financial Institution.
Section 6.19 Pari Passu Ranking. Obligations of the Borrower rank at least pari passu in right of payment (to the fullest extent permitted by law) with all other senior unsecured Indebtedness of Borrower and its Subsidiaries.
ARTICLE VII
EVENTS OF DEFAULT
Each of the following shall constitute an Event of Default hereunder:
Section 7.01 Payments. If (a) the principal of any Loan shall not be paid in full punctually when due and payable, or (b) the interest on any Loan or any facility or other fee shall not be paid in full punctually when due and payable or within five (5) Business Days thereafter.
Section 7.02 Special Covenants. If any Company or Obligor shall fail or omit to perform and observe Section 5.04, Section 5.05, Section 5.06, Section 5.07, Section 5.08, Section 5.12, Section 5.17 or Section 5.18.
Section 7.03 Other Covenants. If any Company or Obligor shall fail or omit to perform and observe any agreement or other provision (other than those referred to in Section 7.01 or Section 7.02 hereof) contained or referred to in this Agreement or any Related Writing that is on such Companys or Obligors part, as the case may be, to be complied with, and that Default shall not have been fully corrected within thirty (30) days after the giving of written notice thereof to Borrower by Agent or any Lender that the specified Default is to be remedied.
Section 7.04 Representations and Warranties. If any representation, warranty or statement made in or pursuant to this Agreement or any Related Writing or any other material information furnished by any Company or any Obligor to the Agent or the Lenders shall be false or erroneous.
Section 7.05 Cross Default. If any Company or Obligor shall default in the payment in an amount in excess of Two Million Five Hundred Thousand Dollars ($2,500,000) of principal, interest or fees due and owing upon any other obligation for borrowed money (other than any of the Debt) in excess, for all such obligations for all such Companies and Obligors, of the greater of (i) Fifty Million Dollars ($50,000,000) and (ii) an amount equal to three percent (3%) of Consolidated Total Assets beyond any period of grace provided with respect thereto, or in the performance or observance of any other agreement, term or condition contained in any agreement under which such obligation is created beyond any period of grace provided with respect thereto, if the effect of such default is to allow the acceleration of the maturity of such Indebtedness or to permit the holder thereof to cause such Indebtedness to become due prior to its stated maturity.
Section 7.06 ERISA Default. The occurrence of one or more ERISA Events that (a) the Required Lenders determine could have a Material Adverse Effect, or (b) results in a Lien on any of the assets of any Company in excess of the greater of (i) Fifty Million Dollars ($50,000,000) and (ii) an amount equal to three percent (3%) of Consolidated Total Assets.
Section 7.07 Change Of Control. If any Change of Control shall occur.
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Section 7.08 Money Judgment. A final judgment or order for the payment of money shall be rendered against any Company or Obligor by a court of competent jurisdiction, that remains unpaid or unstayed and undischarged for a period (during which execution shall not be effectively stayed) of thirty (30) days after the date on which the right to appeal has expired, provided that the aggregate of all such judgments for all such Companies and Obligors shall exceed the greater of (i) Fifty Million Dollars ($50,000,000) and (ii) an amount equal to three percent (3%) of Consolidated Total Assets.
Section 7.09 Validity of Loan Documents. (a) Any material provision, in the reasonable opinion of Agent, of any Loan Document shall at any time for any reason cease to be valid and binding and enforceable against Borrower or any Company; (b) the validity, binding effect or enforceability of any material provision of any Loan Document against Borrower or any Company shall be contested by such Company or any other Obligor; (c) Borrower or any Guarantor of Payment shall deny that it has any or further liability or obligation thereunder; or (d) any material provision of any Loan Document shall be terminated, invalidated or set aside, or be declared ineffective or inoperative or in any way cease to give or provide to Agent and the Lenders the benefits purported to be created thereby.
Section 7.10 Insolvency. If Borrower or any Subsidiary (other than any Subsidiary that individually, or in the aggregate when combined with all other Subsidiaries excluded from this Section 7.10 by operation of this parenthetical, has assets less than or equal to the greater of (i) Fifty Million Dollars ($50,000,000) and (ii) an amount equal to three percent (3%) of Consolidated Total Assets) shall (a) except as permitted pursuant to Section 5.07 hereof, discontinue business, (b) generally not pay its debts as such debts become due, (c) make a general assignment for the benefit of creditors, (d) apply for or consent to the appointment of a receiver, a custodian, a trustee, an interim trustee or liquidator of all or a substantial part of its assets, (e) be adjudicated a debtor or have entered against it an order for relief under Title 11 of the Code, as the same may be amended from time to time, (f) file a voluntary petition in bankruptcy, or have an involuntary proceeding filed against it and the same shall continue undismissed for a period of thirty (30) days from commencement of such proceeding or case, or file a petition or an answer seeking reorganization or an arrangement with creditors or seeking to take advantage of any other law (whether federal or state (or the foreign equivalent)) relating to relief of debtors, or admit (by answer, by default or otherwise) the material allegations of a petition filed against it in any bankruptcy, reorganization, insolvency or other proceeding (whether federal or state (or the foreign equivalent)) relating to relief of debtors, (g) suffer or permit to continue unstayed and in effect for thirty (30) consecutive days any judgment, decree or order entered by a court of competent jurisdiction, that approves a petition seeking its reorganization or appoints a receiver, custodian, trustee, interim trustee or liquidator of all or a substantial part of its assets, or (h) take, or omit to take, any action in order thereby to effect any of the foregoing.
ARTICLE VIII
REMEDIES UPON DEFAULT
Notwithstanding any contrary provision or implication herein or elsewhere:
Section 8.01 Optional Defaults. If any Event of Default referred to in Section 7.01, Section 7.02, Section 7.03, Section 7.04, Section 7.05, Section 7.06, Section 7.07, Section 7.08 or Section 7.09 hereof shall occur, Agent may, with the consent of the Required Lenders, and shall, at the request of the Required Lenders, give written notice to Borrower, to accelerate the
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maturity of all of the Debt (if the Debt is not already due and payable), whereupon all of the Debt shall become and thereafter be immediately due and payable in full without any presentment or demand and without any further or other notice of any kind, all of which are hereby waived by Borrower.
Section 8.02 Automatic Defaults. If any Event of Default referred to in Section 7.10 hereof shall occur the principal, interest and any other amounts then outstanding on all of the Notes, and all of the other Debt, shall thereupon become and thereafter be immediately due and payable in full (if the Debt is not already due and payable), all without any presentment, demand or notice of any kind, which are hereby waived by Borrower.
Section 8.03 Offsets. If there shall occur or exist any Event of Default referred to in Section 7.10 hereof or if the Debt is accelerated pursuant to Section 8.01 or Section 8.02 hereof, each Lender shall have the right at any time to set off against, and to appropriate and apply toward the payment of, any and all Debt then owing by Borrower to that Lender (including, without limitation, any participation purchased or to be purchased pursuant to Section 8.04 hereof), whether or not the same shall then have matured, any and all deposit balances and all other indebtedness then held or owing by that Lender to or for the credit or account of Borrower or any Guarantor of Payment, all without notice to or demand upon Borrower or any other Person, all such notices and demands being hereby expressly waived by Borrower and each Guarantor of Payment.
Section 8.04 Equalization Provision. Each Lender agrees with the other Lenders that if it, at any time, shall obtain any Advantage over the other Lenders or any thereof in respect of the Debt (except under Article III hereof), it shall purchase from the other Lenders, for cash and at par, such additional participation in the Debt as shall be necessary to nullify the Advantage. If any such Advantage resulting in the purchase of an additional participation as aforesaid shall be recovered in whole or in part from the Lender receiving the Advantage, each such purchase shall be rescinded, and the purchase price restored (but without interest unless the Lender receiving the Advantage is required to pay interest on the Advantage to the Person recovering the Advantage from such Lender) ratably to the extent of the recovery. Each Lender further agrees with the other Lenders that if it at any time shall receive any payment for or on behalf of Borrower on any indebtedness owing by Borrower to that Lender by reason of offset of any deposit or other indebtedness, it will apply such payment first to any and all Debt owing by Borrower to that Lender (including, without limitation, any participation purchased or to be purchased pursuant to this Section or any other Section of this Agreement). Borrower agrees that any Lender so purchasing a participation from the other Lenders or any thereof pursuant to this Section may exercise all its rights of payment (including the right of set-off) with respect to such participation as fully as if such Lender was a direct creditor of Borrower in the amount of participation.
ARTICLE IX
THE AGENT
The Lenders authorize PNC Bank, National Association and PNC Bank, National Association hereby agrees to act as agent for the Lenders in respect of this Agreement upon the terms and conditions set forth elsewhere in this Agreement, and upon the following terms and conditions:
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Section 9.01 Appointment and Authorization. Each Lender hereby irrevocably appoints and authorizes Agent to take such action as agent on its behalf and to exercise such powers hereunder as are delegated to Agent by the terms hereof, together with such powers as are reasonably incidental thereto. Neither Agent nor any of its Affiliates, directors, officers, attorneys or employees shall be liable for any action taken or omitted to be taken by it or them hereunder or in connection herewith, except for its or their own gross negligence or willful misconduct.
Section 9.02 Note Holders. Agent may treat the payee of any Note as the holder thereof until written notice of transfer shall have been filed with it, signed by such payee and in form satisfactory to Agent.
Section 9.03 Consultation With Counsel. Agent may consult with legal counsel selected by it and shall not be liable for any action taken or suffered in good faith by it in accordance with the opinion of such counsel.
Section 9.04 Documents. Agent shall not be under any duty to examine into or pass upon the validity, effectiveness, genuineness or value of any Loan Documents or any other Related Writing furnished pursuant hereto or in connection herewith or the value of any collateral obtained hereunder, and Agent shall be entitled to assume that the same are valid, effective and genuine and what they purport to be.
Section 9.05 Agent and Affiliates. With respect to the Loans, Agent, each Joint Lead Arranger, each Co-Documentation Agent and each Co-Syndication Agent shall have the same rights and powers hereunder as any other Lender and may exercise the same as though it were not Agent, a Joint Lead Arranger, a Co-Documentation Agent or a Co-Syndication Agent, as the case may be, and Agent, each Joint Lead Arranger, each Co-Documentation Agent and each Co-Syndication Agent and their respective Affiliates may accept deposits from, lend money to and generally engage in any kind of business with any Company or any Affiliate thereof.
Section 9.06 Knowledge of Default. It is expressly understood and agreed that Agent shall be entitled to assume that no Default or Event of Default has occurred (other than an Event of Default under Section 7.01 hereof), unless Agent has been notified by a Lender in writing that such Lender believes that a Default or Event of Default has occurred and is continuing and specifying the nature thereof or has been notified by Borrower pursuant to Section 5.10 hereof.
Section 9.07 Action By Agent. Subject to the other terms and conditions hereof, so long as Agent shall be entitled, pursuant to Section 9.06 hereof, to assume that no Default or Event of Default shall have occurred and be continuing, Agent shall be entitled to use its discretion with respect to exercising or refraining from exercising any rights that may be vested in it by, or with respect to taking or refraining from taking any action or actions that it may be able to take under or in respect of, this Agreement or the other Loan Documents. Agent shall incur no liability under or in respect of this Agreement or any other Loan Document by acting upon any notice, certificate, warranty or other paper or instrument believed by it to be genuine or authentic or to be signed by the proper party or parties, or with respect to anything that it may do or refrain from doing in the reasonable exercise of its judgment, or that may seem to it to be necessary or desirable in the premises.
Section 9.08 Notices, Default, Etc. In the event that Agent shall have acquired actual knowledge of any Default or Event of Default, Agent shall promptly notify the Lenders and shall
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take such action and assert such rights under this Agreement as the Required Lenders shall direct and Agent shall promptly inform the other Lenders in writing of the action taken. Subject to the other terms and conditions hereof, Agent may take such action and assert such rights as it deems to be advisable, in its discretion, for the protection of the interests of the holders of the Notes.
Section 9.09 Indemnification of Agent. The Lenders agree to indemnify Agent (to the extent not reimbursed by Borrower) ratably, according to their respective Commitment Percentages, from and against any and all liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses or disbursements of any kind or nature whatsoever that may be imposed on, incurred by or asserted against Agent in its agency capacity in any way relating to or arising out of this Agreement or any Loan Document or any action taken or omitted by it with respect to this Agreement or any Loan Document, provided that no Lender shall be liable for any portion of such liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses (including attorneys fees) or disbursements resulting from Agents gross negligence, willful misconduct or from any action taken or omitted by it in any capacity other than as agent under this Agreement.
Section 9.10 Successor Agent. Agent may resign as agent hereunder by giving not fewer than thirty (30) days prior written notice to Borrower and the Lenders. If Agent shall resign under this Agreement, then either (a) the Required Lenders shall appoint from among the Lenders a successor agent for the Lenders (with the consent of Borrower so long as a Default or an Event of Default has not occurred and which consent shall not be unreasonably withheld), or (b) if a successor agent shall not be so appointed and approved within the thirty (30) day period following Agents notice to the Lenders of its resignation, then Agent shall appoint a successor agent that shall serve as agent until such time as the Required Lenders appoint a successor agent. Upon its appointment, such successor agent shall succeed to the rights, powers and duties as agent, and the term Agent shall mean such successor effective upon its appointment, and the former agents 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.
Section 9.11 No Reliance on Agents Customer Identification Program. Each Lender acknowledges and agrees that neither such Lender, nor any of its Affiliates, participants or assignees, may rely on Agent to carry out such Lenders, Affiliates, participants or assignees customer identification program, or other obligations required or imposed under or pursuant to the USA Patriot Act or the regulations thereunder, including the regulations contained in 31 CFR 103.121 (as hereafter amended or replaced, the CIP Regulations), or any other Anti-Terrorism Law, including any programs involving any of the following items relating to or in connection with Borrower, any other Company, their respective Affiliates or agents, the Loan Documents or the transactions hereunder: (a) any identity verification procedures, (b) any record keeping, (c) any comparisons with government lists, (d) any customer notices or (e) any other procedures required under the CIP Regulations or such other law.
Section 9.12 USA Patriot Act. Each Lender or assignee or participant of a Lender that is not organized under the laws of the United States of America or a state thereof (and is not excepted from the certification requirement contained in Section 313 of the USA Patriot Act and the applicable regulations because it is both (a) an Affiliate of a depository institution or foreign bank that maintains a physical presence in the United States or foreign country, and (b) subject to supervision by a banking authority regulating such Affiliated depository institution or foreign bank) shall deliver to Agent the certification, or, if applicable, recertification, certifying that such Lender is not a shell and certifying to other matters as required by Section 313 of the USA
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Patriot Act and the applicable regulations: (i) within 10 days after the Effective Date (or the Closing Date to the extent not previously delivered) and (ii) at such other times as are required under the USA Patriot Act.
Section 9.13 Other Agents. No Bank (other than Agent) that is indicated as having an agency capacity (such as Co-Syndication Agent, Co-Documentation Agent or other similar titles) shall have any duties or responsibilities hereunder in its capacity as such.
ARTICLE X
MISCELLANEOUS
Section 10.01 Lenders Independent Investigation. Each Lender, by its signature to this Agreement, acknowledges and agrees that Agent has made no representation or warranty, express or implied, with respect to the creditworthiness, financial condition, or any other condition of any Company or with respect to the statements contained in any information memorandum furnished in connection herewith or in any other oral or written communication between Agent and such Lender. Each Lender represents that it has made and shall continue to make its own independent investigation of the creditworthiness, financial condition and affairs of the Companies in connection with the extension of credit hereunder, and agrees that Agent has no duty or responsibility, either initially or on a continuing basis, to provide any Lender with any credit or other information with respect thereto (other than such notices as may be expressly required to be given by Agent to the Lenders hereunder), whether coming into its possession before the granting of the Loans hereunder or at any time or times thereafter.
Section 10.02 No Waiver; Cumulative Remedies. No omission or course of dealing on the part of Agent, any Lender or the holder of any Note in exercising any right, power or remedy hereunder or under any of the Loan Documents shall operate as a waiver thereof; nor shall any single or partial exercise of any such right, power or remedy preclude any other or further exercise thereof or the exercise of any other right, power or remedy hereunder or under any of the Loan Documents. The remedies herein provided are cumulative and in addition to any other rights, powers or privileges held by operation of law, by contract or otherwise.
Section 10.03 Amendments; Consents. No amendment, modification, termination, or waiver of any provision of any Loan Document nor consent to any variance therefrom, shall be effective unless the same shall be in writing and signed by the Required Lenders and then such waiver or consent shall be effective only in the specific instance and for the specific purpose for which given. Anything herein to the contrary notwithstanding, no such amendment, modification, termination, waiver or consent may be made with respect to (a) any increase in the Total Commitment Amount without the unanimous consent of all of the Lenders, (b) the extension of the Five Year Term Loan Maturity Date, the Three Year Term Loan Maturity Date or the Eighteen Month Term Loan Maturity Date, the payment date of interest or principal with respect thereto, or the payment date of fees or amounts payable hereunder or under any other Loan Document in each case without the consent of each Lender directly affected thereby, (c) any reduction in the rate of interest on the Loans, or in any amount of principal or interest due on any Loan, or any reduction in the amount of fees hereunder or under any other Loan Document or any change in the manner of pro rata application of any payments made by Borrower to the Lenders hereunder in each case without the unanimous consent of all of the Lenders, (d) any change in any percentage voting requirement, voting rights, or the Required Lenders definition in this Agreement in each case without the unanimous consent of all of the Lenders, (e) the release of any Guarantor of Payment, if any, except in connection with a transaction permitted pursuant
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to Section 5.07 hereof, without the unanimous consent of all of the Lenders or (f) any amendment to this Section 10.03 or Section 8.04 hereof without the unanimous consent of all of the Lenders; provided that (i) no amendment, modification, termination, or waiver shall, unless in writing and signed by the Agent in addition to the Lenders required above, affect the rights or duties of the Agent under this Agreement or any other Loan Document and (ii) the Fee Letter may be amended, modified or rights or privileges thereunder waived, in a writing executed only by the parties thereto. In addition, the Commitment of any Lender may not be increased without the prior written consent of such Lender (even if such Lender is a Defaulting Lender). Notice of amendments or consents ratified by the Lenders hereunder shall immediately be forwarded by Agent to all Lenders. Each Lender or other holder of a Note shall be bound by any amendment, waiver or consent obtained as authorized by this Section, regardless of its failure to agree thereto. Notwithstanding anything to the contrary herein, no Defaulting Lender shall have any right to approve or disapprove any amendment, waiver or consent hereunder (and any amendment, waiver or consent which by its terms requires the consent of all Lenders may be effected with the consent of the applicable Lenders other than Defaulting Lenders), except that any waiver, amendment or modification requiring the consent of all Lenders that by its terms affects any Defaulting Lender disproportionately adversely relative to other affected Lenders shall require the consent of such Defaulting Lender.
Section 10.04 Notices. All notices, requests, demands and other communications provided for hereunder shall be in writing and, if to Borrower, mailed or delivered to it, addressed to it at the address specified on the signature pages of this Agreement, if to a Lender, mailed or delivered to it, addressed to the address of such Lender specified on the signature pages of this Agreement, or, as to each party, at such other address as shall be designated by such party in a written notice to each of the other parties. All notices, statements, requests, demands and other communications provided for hereunder shall be given by overnight delivery or first class mail with postage prepaid by registered or certified mail, addressed as aforesaid, or sent by facsimile with telephonic confirmation of receipt, except that all notices hereunder shall not be effective until received.
Section 10.05 Costs, Expenses and Taxes. Borrower agrees to pay on demand all costs and expenses of Agent and PNC Capital Markets, including, but not limited to, (a) syndication, administration, travel and out-of-pocket expenses, including but not limited to attorneys fees and expenses, of Agent and PNC Capital Markets in connection with the preparation, negotiation and closing of the Loan Documents and the administration of the Loan Documents, the collection and disbursement of all funds hereunder and the other instruments and documents to be delivered hereunder, (b) extraordinary expenses of Agent in connection with the administration of the Loan Documents and the other instruments and documents to be delivered hereunder, and (c) the reasonable fees and out-of-pocket expenses of special counsel for Agent, with respect to the foregoing, and of local counsel, if any, who may be retained by said special counsel with respect thereto. Borrower also agrees to pay on demand all costs and expenses of Agent and the Lenders, including reasonable attorneys fees, in connection with the restructuring or enforcement of the Debt owing by Borrower, this Agreement or any Related Writing. In addition, Borrower shall pay any and all stamp and other taxes and fees payable or determined to be payable in connection with the execution and delivery of the Loan Documents to which Borrower is a party, and the other instruments and documents to be delivered hereunder, and agrees to hold Agent and each Lender harmless from and against any and all liabilities with respect to or resulting from any delay in paying or omission to pay such taxes or fees. All obligations provided for in this Section 10.05 shall survive any termination of this Agreement.
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Section 10.06 Indemnification. Borrower agrees to defend, indemnify and hold harmless Agent and the Lenders (and their respective Related Parties) from and against any and all liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses (including attorneys fees) or disbursements of any kind or nature whatsoever that may be imposed on, incurred by or asserted against Agent or any Lender (or their respective Related Parties) in connection with any investigative, administrative or judicial proceeding (whether or not such Lender or Agent (or Related Party) shall be designated a party thereto) or any other claim by any Person relating to or arising out of any Loan Document or any actual or proposed use of proceeds of the Loans or any of the Debt, or any activities of any Company or any Obligor or any of their respective Affiliates; provided that no Lender nor Agent (or such Related Party) shall have the right to be indemnified under this Section for its own gross negligence or willful misconduct as determined by a court of competent jurisdiction by final and nonappealable judgment. To the fullest extent permitted by applicable law, the Loan Parties shall not assert, and hereby waive, any claim against Agent and the Lenders (and their respective Related Parties), on any theory of liability, for special, indirect, consequential or punitive damages (as opposed to direct or actual damages) solely to the extent arising out of, in connection with, or as a result of, this Agreement, any other Loan Document or any agreement or instrument contemplated directly hereby, the transactions contemplated hereby or thereby, any Loan or the use of the proceeds thereof. All obligations provided for in this Section 10.06 shall survive any termination of this Agreement.
Section 10.07 Obligations Several; No Fiduciary Obligations. The obligations of the Lenders hereunder are several and not joint. Nothing contained in this Agreement and no action taken by Agent or the Lenders pursuant hereto shall be deemed to constitute the Lenders a partnership, association, joint venture or other entity. No default by any Lender hereunder shall excuse the other Lenders from any obligation under this Agreement; but no Lender shall have or acquire any additional obligation of any kind by reason of such default. The relationship among Borrower (and the other Loan Parties) and the Lenders with respect to the Loan Documents and the Related Writings is and shall be solely that of debtor and creditors, respectively, and neither Agent nor any Lender shall have any fiduciary obligation toward Borrower (or the other Loan Parties) with respect to any such documents or the transactions contemplated thereby.
Section 10.08 Execution In Counterparts. This Agreement may be executed in any number of counterparts and by different parties hereto in separate counterparts and by facsimile signature, each of which when so executed and delivered shall be deemed to be an original and all of which taken together shall constitute but one and the same agreement.
Section 10.09 Binding Effect; Borrower Assignment. This Agreement shall become effective when it shall have been executed by Borrower, Agent and by each Lender and thereafter shall be binding upon and inure to the benefit of Borrower, Agent and each of the Lenders and their respective successors and assigns, except that Borrower shall not have the right to assign its rights hereunder or any interest herein without the prior written consent of Agent and all of the Lenders.
Section 10.10 Assignments.
(a) Each Lender shall have the right, in accordance with the terms and conditions of this Section 10.10, at any time or times to assign to one or more commercial banks, finance companies, insurance companies or other financial institution or fund which, in each case, in the ordinary course of business extends credit of the type contemplated herein and whose
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becoming an assignee would not constitute a prohibited transaction under Section 4975 of ERISA (each an Eligible Assignee), without recourse, all or a percentage of all of such Lenders Commitment, all Loans made by such Lender, such Lenders Notes, and such Lenders interest in any participation purchased pursuant to Section 8.04 hereof.
(b) No assignment may be consummated pursuant to this Section 10.10 without the prior written consent of Borrower and Agent (other than an assignment by any Lender to (i) another Lender or (ii) any Affiliate of such Lender which Affiliate is either wholly-owned by such Lender or is wholly-owned by a Person that wholly owns, either directly or indirectly, such Lender), which consent of Borrower and Agent shall not be unreasonably withheld; provided, however, that, Borrowers consent shall not be required if, at the time of the proposed assignment, any Default or Event of Default shall then exist. Anything herein to the contrary notwithstanding, any Lender may at any time make a collateral assignment of all or any portion of its rights under the Loan Documents to a Federal Reserve Bank, and no such assignment shall release such assigning Lender from its obligations hereunder.
(c) Each assignment made pursuant to this Section 10.10 shall be in a minimum amount of the lesser of Five Million Dollars ($5,000,000) of the assignors Commitment and interest herein or the entire amount of the assignors Commitment and interest herein.
(d) Unless an assignment made pursuant to this Section 10.10 shall be to an Affiliate of the assignor or the assignment shall be due to merger of the assignor or for regulatory purposes, either the assignor or the assignee shall remit to Agent, for its own account, an administrative fee of Three Thousand Five Hundred Dollars ($3,500).
(e) Unless an assignment made pursuant to this Section 10.10 shall be due to merger of the assignor or a collateral assignment for regulatory purposes, the assignor shall (i) cause the assignee to execute and deliver to Borrower and Agent an Assignment Agreement and (ii) execute and deliver, or cause the assignee to execute and deliver, as the case may be, to Agent such additional amendments, assurances and other writings as Agent may reasonably require.
(f) If an assignment made pursuant to this 10.10 is to be made to an assignee that is organized under the laws of any jurisdiction other than the United States or any state thereof, the assignor Lender shall cause such assignee, at least five Business Days prior to the effective date of such assignment, (i) to represent to the assignor Lender (for the benefit of the assignor Lender, Agent and Borrower) that under applicable law and treaties no taxes will be required to be withheld by Agent, Borrower or the assignor with respect to any payments to be made to such assignee in respect of the Loans hereunder, (ii) to furnish to the assignor (and, in the case of any assignee registered in the Register (as defined below), Agent and Borrower) either (A) U.S. Internal Revenue Service Form W-8ECI or U.S. Internal Revenue Service Form W-8BENE (or W-8BEN, as applicable) or (B) United States Internal Revenue Service Forms W-8 or W-9, as applicable (wherein such assignee claims entitlement to complete exemption from U.S. federal withholding tax on all interest payments hereunder), and (iii) to agree (for the benefit of the assignor, Agent and Borrower) to provide the assignor Lender (and, in the case of any assignee registered in the Register, Agent and Borrower) a new Form W-8ECI or Form W-8BENE (or W-8BEN, as applicable) or Forms W-8 or W-9, as applicable, upon the expiration or obsolescence of any previously delivered form and comparable statements in accordance with applicable U.S. laws and regulations and amendments duly executed and completed by such
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assignee, and to comply from time to time with all applicable U.S. laws and regulations with regard to such withholding tax exemption.
(g) Upon satisfaction of all applicable requirements specified in subparts (a) though (f) above, Borrower shall execute and deliver (i) to Agent, the assignor and the assignee, any consent or release (of all or a portion of the obligations of the assignor) required to be delivered by Borrower in connection with the Assignment Agreement, and (ii) to the assignee or the assignor (if applicable), an appropriate Note or Notes. After delivery of the new Note or Notes, the assignors Note or Notes being replaced shall be returned to Borrower marked replaced.
(h) Upon satisfaction of all applicable requirements specified in subparts (a) though (f) above, and any other condition contained in this Section 10.10, (i) the assignee shall become and thereafter be deemed to be a Lender for the purposes of this Agreement, (ii) the assignor shall be released from its obligations hereunder to the extent its interest has been assigned, (iii) in the event that the assignors entire interest has been assigned, the assignor shall cease to be and thereafter shall no longer be deemed to be a Lender and (iv) the signature pages hereto and Schedule 1 hereto shall be automatically amended, without further action, to reflect the result of any such assignment.
(i) Agent shall maintain at the address for notices referred to in Section 10.04 hereof a copy of each Assignment Agreement delivered to it and a register (the Register) for the recordation of the names and addresses of the Lenders and the Commitment of, and principal amount (and stated interest) of the Loans owing to, each Lender from time to time. The entries in the Register shall be conclusive, in the absence of manifest error, and Borrower, Agent and the Lenders may treat each financial institution whose name is recorded in the Register as the owner of the Loan recorded therein for all purposes of this Agreement. The Register shall be available for inspection by Borrower or any Lender at any reasonable time and from time to time upon reasonable prior notice.
(j) No assignment shall be made to (A) Borrower or Borrowers Affiliates or Subsidiaries, (B) a natural Person (or a holding company, investment vehicle or trust for, or owned and operated for the primary benefit of, a natural Person) or (C) a Defaulting Lender or any of its Subsidiaries, or any person who, upon becoming a Lender hereunder, would constitute any of the foregoing Persons described in this clause (C).
Section 10.11 Participations.
(a) Each Lender shall have the right at any time or times, without the consent of Agent or Borrower, to sell one or more participations or sub-participations to a financial institution or other accredited investor (as defined in SEC Regulation D) (other than a natural Person, or a holding company, investment vehicle or trust for, owned and operated for the primary benefit of, a natural Person, or the Borrower or any of the Borrowers Affiliates or Subsidiaries), as the case may be (each, a Participant), in all or any part of such Lenders Commitment, such Lenders Commitment Percentage, any Loan made by such Lender, any Note delivered to such Lender pursuant to this Agreement, and such Lenders interest in any participation, if any, purchased pursuant to, Section 8.04 or this Section 10.11.
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(b) The provisions of Article III and Section 10.06 shall inure to the benefit of each purchaser of participation or sub-participation and Agent shall continue to distribute payments pursuant to this Agreement as if no participation has been sold.
(c) 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 Section 10.03 that requires the unanimous consent of the Lenders. Borrower agrees that each Participant shall be entitled to the benefits of Section 3.01, Section 3.04 and Section 3.02 (subject to the requirements and limitations therein, including the requirements under Section 3.02(f) (it being understood that the documentation required under Section 3.02(f) shall be delivered to the participating Lender)) to the same extent as if it were a Lender and had acquired its interest by assignment pursuant to Section 10.10; provided that such Participant (A) agrees to be subject to the provisions of Section 3.08 as if it were an assignee under Section 10.10; and (B) shall not be entitled to receive any greater payment under Section 3.01 or Section 3.02, with respect to any participation, than its participating Lender would have been entitled to receive, except to the extent such entitlement to receive a greater payment results from a Change in Law that occurs after the Participant acquired the applicable participation. Each Lender that sells a participation agrees, at Borrower request and expense, to use reasonable efforts to cooperate with Borrower to effectuate the provisions of Section 3.08 with respect to any Participant. To the extent permitted by law, each Participant also shall be entitled to the benefits of Section 8.03 as though it were a Lender. Each Lender that sells a participation shall, acting solely for this purpose as a non-fiduciary agent of Borrower, maintain a register on which it enters the name and address of each Participant and the principal amounts (and stated interest) of each Participants interest in the Loans or other obligations under the Loan Documents (the Participant Register); provided that no Lender shall have any obligation to disclose all or any portion of the Participant Register (including the identity of any Participant or any information relating to a Participants interest in any commitments, loans, letters of credit or its other obligations under any Loan Document) to any Person except to the extent that such disclosure is necessary to establish that such commitment, loan, letter of credit or other obligation is in registered form under Section 5f.103-1(c) of the United States Treasury Regulations. The entries in the Participant Register shall be conclusive absent manifest error, and such Lender shall treat each Person whose name is recorded in the Participant Register as the owner of such participation for all purposes of this Agreement notwithstanding any notice to the contrary. For the avoidance of doubt, the Agent (in its capacity as Agent) shall have no responsibility for maintaining a Participant Register.
(d) No participation or sub-participation shall operate as a delegation of any duty of the seller thereof.
(e) Under no circumstance shall any participation or sub-participation be deemed a novation in respect of all or any part of the sellers obligations pursuant to this Agreement.
Section 10.12 Severability Of Provisions; Captions; Attachments. Any provision of this Agreement that 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 or affecting the validity or enforceability of such provision in any other jurisdiction. The several captions to Sections and subsections herein are inserted for
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convenience only and shall be ignored in interpreting the provisions of this Agreement. Each schedule or exhibit attached to this Agreement shall be incorporated herein and shall be deemed to be a part hereof.
Section 10.13 Investment Purpose. Each of the Lenders represents and warrants to Borrower that it is entering into this Agreement with the present intention of acquiring any Note issued pursuant hereto for investment purposes only and not for the purpose of distribution or resale, it being understood, however, that each Lender shall at all times retain full control over the disposition of its assets.
Section 10.14 Entire Agreement. This Agreement, any Note and any other Loan Document or other agreement, document or instrument attached hereto or executed on or as of the Effective Date integrate all the terms and conditions mentioned herein or incidental hereto and supersede all oral representations and negotiations and prior writings with respect to the subject matter hereof.
Section 10.15 Governing Law; Submission to Jurisdiction. This Agreement, each of the Notes and any Related Writing shall be governed by and construed in accordance with the laws of the State of Ohio and the respective rights and obligations of Borrower, Agent and the Lenders shall be governed by Ohio law, without regard to principles of conflict of laws (provided that the laws of the state governing the Closing Date Acquisition Agreement shall apply in determining (a) the accuracy of any Specified Acquisition Agreement Representation and whether as a result of any inaccuracy thereof Borrower, its Subsidiaries or its Affiliates have the right or would have the right to terminate their respective obligations (or to refuse to consummate the Closing Date Acquisition) under the Closing Date Acquisition Documents and (b) whether the Closing Date Acquisition has been consummated in accordance with the terms of the Closing Date Acquisition Documents, in each case, regardless of the laws that might otherwise govern under applicable principles of conflict of laws). Borrower hereby irrevocably submits to the non-exclusive jurisdiction of any Ohio state or federal district court sitting in Cleveland, Ohio, over any action or proceeding arising out of or relating to this Agreement, the Debt or any Related Writing, and Borrower hereby irrevocably agrees that all claims in respect of such action or proceeding may be heard and determined in such Ohio state or federal court. Borrower, on behalf of itself and its Subsidiaries, hereby irrevocably waives, to the fullest extent permitted by law, any objection it may now or hereafter have to the laying of venue in any action or proceeding in any such court as well as any right it may now or hereafter have to remove such action or proceeding, once commenced, to another court on the grounds of FORUM NON CONVENIENS or otherwise. Borrower agrees that a final, nonappealable judgment in any such action or proceeding shall be conclusive and may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by law.
Section 10.16 Legal Representation of Parties. The Loan Documents were negotiated by the parties with the benefit of legal representation and any rule of construction or interpretation otherwise requiring this Agreement or any other Loan Document to be construed or interpreted against any party shall not apply to any construction or interpretation hereof or thereof.
Section 10.17 Treatment of Certain Information; Confidentiality. Each of the Agent and the Lenders agree to maintain the confidentiality of the Information (as defined below), except that Information may be disclosed (a) to each of their Affiliates and to each of their Related Parties (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
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confidential); (b) to the extent required or requested by any regulatory authority purporting to have jurisdiction over such Person or its Related Parties (including any self-regulatory authority, such as the National Association of Insurance Commissioners); (c) to the extent required by applicable laws or regulations or by any subpoena or similar legal process; (d) to any other party hereto; (e) in connection with the exercise of any remedies hereunder or under any other Loan Document or any action or proceeding relating to this Agreement or any other Loan Document or the enforcement of rights hereunder or thereunder; (f) subject to an agreement containing provisions substantially the same as those of this Section, to (i) any assignee of or Participant in, or any prospective assignee of or Participant in, any of its rights and obligations under this Agreement, or (ii) any actual or prospective party (or its Related Parties) to any swap, derivative or other transaction under which payments are to be made by reference to Borrower and its obligations, this Agreement or payments hereunder; (g) on a confidential basis to the CUSIP Service Bureau or any similar agency in connection with the issuance and monitoring of CUSIP numbers with respect to the Debt; (h) with the consent of Borrower; or (i) to the extent such Information (x) becomes publicly available other than as a result of a breach of this Section, or (y) becomes available to the Agent, any Lender or any of their respective Affiliates on a nonconfidential basis from a source other than Borrower.
In no event shall the Agent or any of its Related Parties have any liability to the Borrower, any Lender or any other Person for losses, claims, damages, liabilities or expenses of any kind (whether in tort, contract or otherwise) arising out of the Agents transmission of Information or notices through IntraLinks, Syndtrak, ClearPar, any other electronic platform or electronic messaging service, or through the Internet except to the extent such losses, claims, damages, liabilities or expenses have resulted from such Agent Party gross negligence or willful misconduct as determined by a court of competent jurisdiction by final and nonappealable judgment.
For purposes of this Section 10.18, Information means all information received from Borrower or any of its Subsidiaries relating to Borrower or any of its Subsidiaries or any of their respective businesses, other than any such information that is available to the Agent or any Lender on a nonconfidential basis prior to disclosure by Borrower or any of its Subsidiaries; provided that, in the case of information received from Borrower or any of its Subsidiaries after the date hereof, such information is clearly identified at the time of delivery as confidential. Any Person required to maintain the confidentiality of Information as provided in this Section shall be considered to have complied with its obligation to do so if such Person has exercised the same degree of care to maintain the confidentiality of such Information as such Person would accord to its own confidential information.
Section 10.18 JURY TRIAL WAIVER. BORROWER, AGENT AND EACH OF THE LENDERS WAIVE ANY RIGHT TO HAVE A JURY PARTICIPATE IN RESOLVING ANY DISPUTE, WHETHER SOUNDING IN CONTRACT, TORT OR OTHERWISE, AMONG BORROWER, AGENT AND THE LENDERS, OR ANY THEREOF, ARISING OUT OF, IN CONNECTION WITH, RELATED TO, OR INCIDENTAL TO THE RELATIONSHIP ESTABLISHED AMONG THEM IN CONNECTION WITH THIS AGREEMENT OR ANY NOTE OR OTHER INSTRUMENT, DOCUMENT OR AGREEMENT EXECUTED OR DELIVERED IN CONNECTION HEREWITH OR THE TRANSACTIONS RELATED THERETO.
Section 10.19 Acknowledgement and Consent to Bail-In of EEA Financial Institutions. Solely to the extent any Lender that is an EEA Financial Institution is a party to this Agreement
66
and notwithstanding anything to the contrary in any Loan Document or in any other agreement, arrangement or understanding among any such parties, each party hereto acknowledges that any liability of any Lender that is an EEA Financial Institution arising under any Loan Document, to the extent such liability is unsecured, may be subject to the write-down and conversion powers of an EEA Resolution Authority and agrees and consents to, and acknowledges and agrees to be bound by:
(a) the application of any Write-Down and Conversion Powers by an EEA Resolution Authority to any such liabilities arising hereunder which may be payable to it by any Lender that is an EEA Financial Institution; and
(b) the effects of any Bail-In Action on any such liability, including, if applicable:
(i) a reduction in full or in part or cancellation of any such liability;
(ii) a conversion of all, or a portion of, such liability into shares or other instruments of ownership in such EEA Financial Institution, its parent undertaking, or a bridge institution that may be issued to it or otherwise conferred on it, and that such shares or other instruments of ownership will be accepted by it in lieu of any rights with respect to any such liability under this Agreement or any other Loan Document; or
(iii) the variation of the terms of such liability in connection with the exercise of the write-down and conversion powers of any EEA Resolution Authority.
Section 10.20 USA Patriot Act Notice. Each Lender that is subject to the USA Patriot Act and the Agent (for itself and not on behalf of any Lender) hereby notifies Loan Parties that pursuant to the requirements of the USA Patriot Act, it is required to obtain, verify and record information that identifies the Loan Parties, which information includes the name and address of Loan Parties and other information that will allow such Lender or Administrative Agent, as applicable, to identify the Loan Parties in accordance with the USA Patriot Act.
[Remainder of page intentionally left blank]
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[SIGNATURE PAGES TO TERM LOAN AGREEMENT]
NORDSON CORPORATION | ||
By: | /s/Gregory A. Thaxton | |
Name: | Gregory A. Thaxton | |
Title: | Senior Vice President, Chief Financial Officer | |
Address: 28601 Clemens Road | ||
Westlake, Ohio 44145 | ||
Attention: Senior Vice President, | ||
Chief Financial Officer |
FIRST AMENDMENT AND JOINDER TO
TERM LOAN AGREEMENT
SIGNATURE PAGE
PNC BANK, NATIONAL ASSOCIATION, as Agent and as a Lender | ||
By: | /s/Joseph G. Moran | |
Name: | Joseph G. Moran | |
Title: | Senior Vice President | |
Address: PNC Bank, National Association | ||
Agency Services | ||
Mail Stop: P7-PFSC-04-I | ||
Address: 500 First Avenue | ||
Pittsburgh, PA 15219 | ||
Attention: Agency Services | ||
Telephone: 412 762 6442 | ||
Telecopy: 412 762 8672 |
FIRST AMENDMENT AND JOINDER TO
TERM LOAN AGREEMENT
SIGNATURE PAGE
EXHIBIT A
FIVE YEAR TERM LOAN NOTE
$ | Cleveland, Ohio
, 2017 |
FOR VALUE RECEIVED, the undersigned, NORDSON CORPORATION (Borrower) promises to pay on the Five Year Term Loan Maturity Date, as defined in the Term Loan Agreement (as hereinafter defined), to (Lender) at the main office of the principal sum of
DOLLARS |
or the aggregate unpaid principal amount of all Loans, as defined in the Term Loan Agreement, made by Lender to Borrower pursuant to Section 2.01(a) of the Term Loan Agreement, whichever is less, in lawful money of the United States of America. As used herein, Term Loan Agreement means the Term Loan Agreement dated as of February 21, 2017, among Borrower, the lenders named therein (including in their respective special agency capacities) and PNC Bank, National Association, as Agent, as the same may from time to time be amended, restated or otherwise modified. Capitalized terms used herein shall have the meanings ascribed to them in the Term Loan Agreement.
Borrower also promises to pay interest on the unpaid principal amount of each of the Five Year Term Loans from time to time outstanding, from the date of such Five Year Term Loan until the payment in full thereof, at the rates per annum that shall be determined in accordance with the provisions of Section 2.01(a) of the Term Loan Agreement. Such interest shall be payable on each date provided for in such Section 2.01(a); provided, however, that interest on any principal portion that is not paid when due shall be payable on demand.
The portions of the principal sum hereof from time to time representing Five Year Base Rate Term Loans and Five Year Eurodollar Term Loans, and payments of principal of any thereof, shall be shown on the records of Lender by such method as Lender may generally employ; provided, however, that failure to make any such entry shall in no way detract from Borrowers obligations under this Five Year Term Loan Note (this Note).
If this Note shall not be paid at maturity, whether such maturity occurs by reason of lapse of time or by operation of any provision for acceleration of maturity contained in the Term Loan Agreement, the principal hereof and the unpaid interest thereon shall bear interest, until paid, at a rate per annum equal to the Default Rate. All payments of principal of and interest on this Note shall be made in immediately available funds.
This Note is one of the Notes referred to in the Term Loan Agreement. Reference is made to the Term Loan Agreement for a description of the right of the undersigned to anticipate payments hereof, the right of the holder hereof to declare this Note due prior to its stated maturity, and other terms and conditions upon which this Note is issued.
1
Except as expressly provided in the Term Loan Agreement, Borrower expressly waives presentment, demand, protest and notice of any kind.
JURY TRIAL WAIVER. BORROWER, AGENT AND EACH OF THE LENDERS WAIVE ANY RIGHT TO HAVE A JURY PARTICIPATE IN RESOLVING ANY DISPUTE, WHETHER SOUNDING IN CONTRACT, TORT OR OTHERWISE, AMONG BORROWER, AGENT AND THE LENDERS, OR ANY THEREOF, ARISING OUT OF, IN CONNECTION WITH, RELATED TO, OR INCIDENTAL TO THE RELATIONSHIP ESTABLISHED AMONG THEM IN CONNECTION WITH THIS NOTE OR ANY OTHER INSTRUMENT, DOCUMENT OR AGREEMENT EXECUTED OR DELIVERED IN CONNECTION HEREWITH OR THE TRANSACTIONS RELATED THERETO.
NORDSON CORPORATION | ||||
By: |
| |||
Name: | Gregory A. Thaxton | |||
Title: | Senior Vice President, Chief Financial Officer |
2
EXHIBIT B
THREE YEAR TERM LOAN NOTE
$ | Cleveland, Ohio
, 2017 |
FOR VALUE RECEIVED, the undersigned, NORDSON CORPORATION (Borrower) promises to pay on the Three Year Term Loan Maturity Date, as defined in the Term Loan Agreement (as hereinafter defined), to (Lender) at the main office of the principal sum of
DOLLARS |
or the aggregate unpaid principal amount of all Loans, as defined in the Term Loan Agreement, made by Lender to Borrower pursuant to Section 2.01(b) of the Term Loan Agreement, whichever is less, in lawful money of the United States of America. As used herein, Term Loan Agreement means the Term Loan Agreement dated as of February 21, 2017, among Borrower, the lenders named therein (including in their respective special agency capacities) and PNC Bank, National Association, as Agent, as the same may from time to time be amended, restated or otherwise modified. Capitalized terms used herein shall have the meanings ascribed to them in the Term Loan Agreement.
Borrower also promises to pay interest on the unpaid principal amount of each of the Three Year Term Loans from time to time outstanding, from the date of such Three Year Term Loan until the payment in full thereof, at the rates per annum that shall be determined in accordance with the provisions of Section 2.01(b) of the Term Loan Agreement. Such interest shall be payable on each date provided for in such Section 2.01(b); provided, however, that interest on any principal portion that is not paid when due shall be payable on demand.
The portions of the principal sum hereof from time to time representing Three Year Base Rate Term Loans and Three Year Eurodollar Term Loans, and payments of principal of any thereof, shall be shown on the records of Lender by such method as Lender may generally employ; provided, however, that failure to make any such entry shall in no way detract from Borrowers obligations under this Three Year Term Loan Note (this Note).
If this Note shall not be paid at maturity, whether such maturity occurs by reason of lapse of time or by operation of any provision for acceleration of maturity contained in the Term Loan Agreement, the principal hereof and the unpaid interest thereon shall bear interest, until paid, at a rate per annum equal to the Default Rate. All payments of principal of and interest on this Note shall be made in immediately available funds.
This Note is one of the Notes referred to in the Term Loan Agreement. Reference is made to the Term Loan Agreement for a description of the right of the undersigned to anticipate
3
payments hereof, the right of the holder hereof to declare this Note due prior to its stated maturity, and other terms and conditions upon which this Note is issued.
Except as expressly provided in the Term Loan Agreement, Borrower expressly waives presentment, demand, protest and notice of any kind.
JURY TRIAL WAIVER. BORROWER, AGENT AND EACH OF THE LENDERS WAIVE ANY RIGHT TO HAVE A JURY PARTICIPATE IN RESOLVING ANY DISPUTE, WHETHER SOUNDING IN CONTRACT, TORT OR OTHERWISE, AMONG BORROWER, AGENT AND THE LENDERS, OR ANY THEREOF, ARISING OUT OF, IN CONNECTION WITH, RELATED TO, OR INCIDENTAL TO THE RELATIONSHIP ESTABLISHED AMONG THEM IN CONNECTION WITH THIS NOTE OR ANY OTHER INSTRUMENT, DOCUMENT OR AGREEMENT EXECUTED OR DELIVERED IN CONNECTION HEREWITH OR THE TRANSACTIONS RELATED THERETO.
NORDSON CORPORATION | ||||
By: |
| |||
Name: | Gregory A. Thaxton | |||
Title: | Senior Vice President, Chief Financial Officer |
4
EXHIBIT C
EIGHTEEN MONTH TERM LOAN NOTE
$ | Cleveland, Ohio
, 2017 |
FOR VALUE RECEIVED, the undersigned, NORDSON CORPORATION (Borrower) promises to pay on the Eighteen Month Term Loan Maturity Date, as defined in the Term Loan Agreement (as hereinafter defined), to (Lender) at the main office of the principal sum of
DOLLARS |
or the aggregate unpaid principal amount of all Loans, as defined in the Term Loan Agreement, made by Lender to Borrower pursuant to Section 2.01(c) of the Term Loan Agreement, whichever is less, in lawful money of the United States of America. As used herein, Term Loan Agreement means the Term Loan Agreement dated as of February 21, 2017, among Borrower, the lenders named therein (including in their respective special agency capacities) and PNC Bank, National Association, as Agent, as the same may from time to time be amended, restated or otherwise modified. Capitalized terms used herein shall have the meanings ascribed to them in the Term Loan Agreement.
Borrower also promises to pay interest on the unpaid principal amount of each of the Eighteen Month Term Loans from time to time outstanding, from the date of such Eighteen Month Term Loan until the payment in full thereof, at the rates per annum that shall be determined in accordance with the provisions of Section 2.01(c) of the Term Loan Agreement. Such interest shall be payable on each date provided for in such Section 2.01(c); provided, however, that interest on any principal portion that is not paid when due shall be payable on demand.
The portions of the principal sum hereof from time to time representing Eighteen Month Base Rate Term Loans and Eighteen Month Eurodollar Term Loans, and payments of principal of any thereof, shall be shown on the records of Lender by such method as Lender may generally employ; provided, however, that failure to make any such entry shall in no way detract from Borrowers obligations under this Eighteen Month Term Loan Note (this Note).
If this Note shall not be paid at maturity, whether such maturity occurs by reason of lapse of time or by operation of any provision for acceleration of maturity contained in the Term Loan Agreement, the principal hereof and the unpaid interest thereon shall bear interest, until paid, at a rate per annum equal to the Default Rate. All payments of principal of and interest on this Note shall be made in immediately available funds.
This Note is one of the Notes referred to in the Term Loan Agreement. Reference is made to the Term Loan Agreement for a description of the right of the undersigned to anticipate
1
payments hereof, the right of the holder hereof to declare this Note due prior to its stated maturity, and other terms and conditions upon which this Note is issued.
Except as expressly provided in the Term Loan Agreement, Borrower expressly waives presentment, demand, protest and notice of any kind.
JURY TRIAL WAIVER. BORROWER, AGENT AND EACH OF THE LENDERS WAIVE ANY RIGHT TO HAVE A JURY PARTICIPATE IN RESOLVING ANY DISPUTE, WHETHER SOUNDING IN CONTRACT, TORT OR OTHERWISE, AMONG BORROWER, AGENT AND THE LENDERS, OR ANY THEREOF, ARISING OUT OF, IN CONNECTION WITH, RELATED TO, OR INCIDENTAL TO THE RELATIONSHIP ESTABLISHED AMONG THEM IN CONNECTION WITH THIS NOTE OR ANY OTHER INSTRUMENT, DOCUMENT OR AGREEMENT EXECUTED OR DELIVERED IN CONNECTION HEREWITH OR THE TRANSACTIONS RELATED THERETO.
NORDSON CORPORATION | ||||
By: |
| |||
Name: | Gregory A. Thaxton | |||
Title: | Senior Vice President, Chief Financial Officer |
2
EXHIBIT D
NOTICE OF LOAN
[Date] , 20
PNC Bank, National Association, as Agent
[ADDRESS]
Ladies and Gentlemen:
The undersigned, NORDSON CORPORATION (the Borrower), refers to the Term Loan Agreement, dated as of February 21, 2017 (Term Loan Agreement, the terms defined therein being used herein as therein defined), among the undersigned, the Lenders (including in their respective special agency capacities), as defined in the Term Loan Agreement, and PNC BANK, NATIONAL ASSOCIATION as Agent, and hereby gives you notice, pursuant to Section 2.02 of the Term Loan Agreement that the undersigned hereby requests a Loan under the Term Loan Agreement, and in connection therewith sets forth below the information relating to the Loan (the Proposed Loan) as required by Section 2.02 of the Term Loan Agreement:
(a) The Business Day of the Proposed Loan is , 20 .
(b) The amount of the Proposed Loan is $ .
(c) The Proposed Loan is to be a Five Year Base Rate Term Loan /Five Year Eurodollar Term Loan /Three Year Base Rate Term Loan /Three Year Eurodollar Term Loan / Eighteen Month Base Rate Term Loan /Eighteen Month Eurodollar Term Loan (Check one.)
(d) If the Proposed Loan is a Eurodollar Loan, the Interest Period requested is one week , one month , two months , three months , six months . (Check one.)
The undersigned hereby certifies that the following statements are true on the date hereof, and will be true on the date of the Proposed Loan:
(i) Each of the representations and warranties contained in Article VI of the Term Loan Agreement and in the other Loan Documents are true and correct as of such date in all material respects (except such representations and warranties that are qualified by materiality, which shall be true and correct in all respects) (except to the extent that any such representations and warranties relates to an earlier date or period, in which case such representations and warranties shall have been true and correct in all material
1
respects on and as of such earlier date or period (except such representations and warranties that are qualified by materiality, which shall be true and correct in all respects on and as of such earlier date or period))[; provided that the accuracy of such representations and warranties with respect to the Closing Date Target shall not be a condition to the availability of the Proposed Loan on the Closing Date]1;
(ii) no Event of Default exists, nor immediately after the making of the Proposed Loan will exist; and
(iii) the conditions set forth in Section 2.02 and Section 4.02 of the Term Loan Agreement have been satisfied.
NORDSON CORPORATION | ||
By: |
| |
Name: | ||
Title: |
1 | Only include bracketed language for Proposed Loans to be funded on the Closing Date. |
2
EXHIBIT E
COMPLIANCE CERTIFICATE
For Fiscal Quarter ended
THE UNDERSIGNED HEREBY CERTIFIES THAT:
(1) I am the duly elected [Chief Financial Officer][Treasurer] of NORDSON CORPORATION, an Ohio corporation (Borrower);
(2) I am familiar with the terms of that certain Term Loan Agreement, dated as of February 21, 2017, among the undersigned, the Lenders (including in their respective special agency capacities), as defined in the Term Loan Agreement, and PNC BANK, NATIONAL ASSOCIATION, as Agent (as the same may from time to time be amended, restated or otherwise modified, the Term Loan Agreement, the terms defined therein being used herein as therein defined), and the terms of the other Loan Documents, and I have made, or have caused to be made under my supervision, a review in reasonable detail of the transactions and condition of Borrower and its Subsidiaries during the accounting period covered by the attached financial statements;
(3) The review described in paragraph (2) above did not disclose, and I have no knowledge of, the existence of any condition or event that constitutes or constituted a Default or Event of Default, at the end of the accounting period covered by the attached financial statements or as of the date of this Certificate;
(4) Each of the representations and warranties contained in Article VI of the Term Loan Agreement and in the other Loan Documents are true and correct as though made on and as of the date hereof in all material respects (except such representations and warranties that are qualified by materiality, which shall be true and correct in all respects) (except to the extent that any such representations and warranties relates to an earlier date or period, in which case such representations and warranties shall have been true and correct in all material respects on and as of such earlier date or period (except such representations and warranties that are qualified by materiality, which shall be true and correct in all respects on and as of such earlier date or period)); and
(5) Set forth on Attachment I hereto are calculations of the financial covenants set forth in Section 5.04 of the Term Loan Agreement, which calculations show compliance with the terms thereof and a calculation of Consolidated Total Assets.
IN WITNESS WHEREOF, I have signed this certificate the day of , 20 .
1
NORDSON CORPORATION | ||
By: |
| |
Name: | ||
Title: |
2
EXHIBIT F
FORM OF
ASSIGNMENT AND ASSUMPTION AGREEMENT
This Assignment and Assumption Agreement (the Assignment) is dated as of the Effective Date set forth below and is entered into by and between [Insert name of Assignor] (the Assignor) and [Insert name of Assignee] (the Assignee). Capitalized terms used but not defined herein shall have the meanings given to such terms in the Term Loan Agreement identified below (as the same may from time to time be amended, restated or otherwise modified, the Term Loan Agreement), receipt of a copy of which is hereby acknowledged by the Assignee. The Standard Terms and Conditions set forth in Annex 1 attached hereto are hereby agreed to and incorporated herein by reference and made a part of this Assignment as if set forth herein in full.
For an agreed consideration, the Assignor hereby irrevocably sells and assigns to the Assignee, and the Assignee hereby irrevocably purchases and assumes from the Assignor, subject to and in accordance with the Standard Terms and Conditions and the Term Loan Agreement, as of the Effective Date inserted by the Agent as contemplated below, the interest in and to all of the Assignors rights and obligations under the Term Loan Agreement and any other documents or instruments delivered pursuant thereto that represents the amount and percentage interest identified below of all of the Assignors outstanding rights and obligations under the respective facilities identified below, including, to the extent included in any such facilities, (the Assigned Interest). Such sale and assignment is without recourse to the Assignor and, except as expressly provided in this Assignment, without representation or warranty by the Assignor.
1. | Assignor: | |||
2. | Assignee: | |||
3. | Borrower: | NORDSON CORPORATION | ||
4. | Agent: | PNC BANK, NATIONAL ASSOCIATION, as Agent under the Term Loan Agreement | ||
5. | Term Loan Agreement: |
The Term Loan Agreement dated as of February 21, 2017 among NORDSON CORPORATION, the Lenders party thereto and PNC BANK, NATIONAL ASSOCIATION, as Agent. | ||
6. | Assigned Interest: |
1
Facility/Commitment |
Aggregate Amount of Loans For all Lenders |
Amount of Loans Assigned |
Percentage Assigned of Loans2 |
|||||||||
Five Year Term Loan |
$ | $ | % | |||||||||
Three Year Term Loan |
$ | $ | % | |||||||||
Eighteen Month Term Loan |
$ | $ | % |
Effective Date: , 20 [TO BE INSERTED BY AGENT AND WHICH SHALL BE THE EFFECTIVE DATE OF RECORDATION OF TRANSFER IN THE REGISTER THEREFOR.]
The terms set forth in this Assignment are hereby agreed to:
ASSIGNOR [NAME OF ASSIGNOR] | ||
By: | ||
Name: | ||
Title: | ||
ASSIGNEE [NAME OF ASSIGNEE] | ||
By: | ||
Name: | ||
Title: |
2 | Set Forth, to at least 9 decimals, as a percentage of the Loans of all Banks thereunder. |
2
[Consented to and]3 Accepted:
, as Agent | ||
By: |
| |
Name: |
| |
Title: |
| |
[Consented to:
NORDSON CORPORATION | ||
By: |
| |
Name: |
| |
Title: | ]4 |
3 | To be added only if the consent of Agent is required by the terms of the Term Loan Agreement. |
4 | To be added only if the consent of Borrower is required by the terms of the Term Loan Agreement. |
3
ANNEX 1
Term Loan Agreement
for Nordson Corporation
dated as of February 21, 2017
(the Term Loan Agreement)
STANDARD TERMS AND CONDITIONS FOR ASSIGNMENT
AND ASSUMPTION AGREEMENT
1. Representations and Warranties.
1.1. Assignor. The Assignor (a) represents and warrants that (i) it is the legal and beneficial owner of the Assigned Interest, (ii) the Assigned Interest is free and clear of any lien, encumbrance or other adverse claim and (iii) it has full power and authority, and has taken all action necessary, to execute and deliver this Assignment and to consummate the transactions contemplated hereby; and (b) assumes no responsibility with respect to (i) any statements, warranties or representations made in or in connection with any Loan Document, (ii) the execution, legality, validity, enforceability, genuineness, sufficiency or value of the Term Loan Agreement or any other instrument or document delivered pursuant thereto, other than this Assignment (herein, collectively, the Credit Documents), or any collateral thereunder, (iii) the financial condition of Borrower, any of its Subsidiaries or Affiliates or any other Person obligated in respect of any Credit Document or (iv) the performance or observance by Borrower, any of its Subsidiaries or Affiliates or any other Person of any of their respective obligations under any Credit Document.
1.2. Assignee. The Assignee (a) represents and warrants that (i) it has full power and authority, and has taken all action necessary, to execute and deliver this Assignment and to consummate the transactions contemplated hereby and to become a Lender under the Term Loan Agreement, (ii) it meets all requirements of an eligible assignee under Section 10.10 of the Term Loan Agreement, (iii) from and after the Effective Date, it shall be bound by the provisions of the Term Loan Agreement and, to the extent of the Assigned Interest, shall have the obligations of a Lender thereunder, (iv) it has received a copy of the Term Loan Agreement, together with copies of the most recent financial statements delivered pursuant to Section 5.01 thereof, as applicable, and such other documents and information as it has deemed appropriate to make its own credit analysis and decision to enter into this Assignment and to purchase the Assigned Interest on the basis of which it has made such analysis and decision, and (v) if it is an assignee described in Section 10.10(f) of the Term Loan Agreement, attached to the Assignment is any documentation required to be delivered by it pursuant to the terms of the Term Loan Agreement, duly completed and executed by the Assignee; and (b) agrees that (i) it will, independently and without reliance on Agent, the Assignor 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 decisions in taking or not taking action under the Credit Documents, and (ii) it will perform in accordance with their terms all of the obligations that by the terms of the Credit Documents are required to be performed by it as a Lender.
2. Payments. From and after the Effective Date, Agent shall make all payments in respect of the Assigned Interest (including payments of principal, interest, fees and other amounts) to the Assignor for amounts that have accrued to (but excluding) the Effective Date and to the Assignee for amounts that have accrued from and after the Effective Date.
3. General Provisions. This Assignment shall be binding upon, and inure to the benefit of, the parties hereto and their respective successors and assigns. This Assignment may be executed in any number of counterparts, which together shall constitute one instrument. Delivery of an executed counterpart of a signature page of this Assignment by telecopy shall be effective as delivery of a manually executed counterpart of this Assignment. This Assignment shall be governed by, and construed in accordance with, the law of the State of Ohio, without regard to principles of conflicts of laws.
[End of Annex 1]
2
EXHIBIT G
FORM OF GUARANTY OF PAYMENT
GUARANTY OF PAYMENT
(Subsidiary)
This GUARANTY OF PAYMENT (as the same may from time to time be amended, restated or otherwise modified, this Agreement) is made as of the [ ] day of , 20 by:
(a) each Guarantor of Payment (as defined in the Term Loan Agreement, as hereinafter defined) that is listed on Exhibit A hereto, and any other Subsidiary that hereafter becomes a party hereto (collectively, the Guarantors and, individually, each a Guarantor), jointly and severally, in favor of;
(b) PNC BANK, NATIONAL ASSOCIATION, as the administrative agent under the Term Loan Agreement, as hereinafter defined (the Administrative Agent), for the benefit of the Administrative Agent and the Lenders, as hereinafter defined.
1. Recitals.
NORDSON CORPORATION, an Ohio corporation (Borrower), and each Guarantor of Payment, as defined in the Term Loan Agreement, as hereinafter defined, are entering into that certain Term Loan Agreement, dated as of February 21, 2017, with the lenders from time to time party thereto (together with their respective successors and assigns and any other additional lenders that become party to the Term Loan Agreement, collectively, the Lenders and, individually, each a Lender), and the Administrative Agent (as the same may from time to time be amended, restated or otherwise modified, the Term Loan Agreement). Each Guarantor desires that the Lenders grant to Borrower the financial accommodations as described in the Term Loan Agreement. Except as specifically defined herein, capitalized terms used herein that are defined in the Term Loan Agreement shall have their respective meanings ascribed to them in the Term Loan Agreement.
Each Guarantor, a direct or indirect subsidiary of Borrower, deems it to be in the direct pecuniary and business interests of such Guarantor that Borrower obtains from the Lenders the Commitment, and the Loans provided for in the Term Loan Agreement.
Each Guarantor understands that the Lenders are willing to enter into the Term Loan Agreement and grant the financial accommodations provided for in the Term Loan Agreement only upon certain terms and conditions, one of which is that the Guarantors jointly and severally guarantee the payment of the Obligations, as hereinafter defined, and this Agreement is being executed and delivered in consideration of the Lenders entering into the Term Loan Agreement and each financial accommodation granted to Borrower by the Lenders and for other valuable consideration, the receipt and sufficiency of which is hereby acknowledged.
2. Definitions. As used in this Agreement, the following terms shall have the following meanings:
Collateral means, collectively, all property, if any, securing the Obligations or any part thereof at the time in question.
Guaranty of Payment Joinder means a Guaranty of Payment Joinder, substantially in the form of the attached Exhibit B, prepared by the Administrative Agent and executed and delivered to the Administrative Agent by a Subsidiary for the purpose of adding an additional Guarantor as a party to this Agreement.
Obligations means, collectively, (a) all Indebtedness and other obligations now owing or hereafter incurred by Borrower to the Administrative Agent, or any Lender pursuant to the Term Loan Agreement and the other Loan Documents, and includes the principal of and interest on all Loans; (b) each extension, renewal, consolidation or refinancing of any of the foregoing, in whole or in part; (c) the facility and other fees, and any prepayment fees payable pursuant to the Term Loan Agreement or any other Loan Document; (d) every other liability, now or hereafter owing to the Administrative Agent or any Lender by any Company or Guarantor pursuant to the Term Loan Agreement or any other Loan Document; and (e) all related expenses, to the extent such expenses are reasonable.
Obligor means any Person that, or any of whose property, is or shall be obligated on the Obligations or any part thereof in any manner and includes, without limiting the generality of the foregoing, Borrower, any Guarantor or any Guarantor of Payment, and any other co-maker, endorser, guarantor of payment, subordinating creditor, assignor, grantor of a security interest, pledgor, mortgagor or any hypothecator of property, if any.
3. Guaranty of the Obligations. The Guarantors hereby absolutely and unconditionally, jointly and severally, guarantee (as a guaranty of payment and not merely a guaranty of collection) the prompt payment in full of all of the Obligations as and when the respective parts thereof become due and payable. If the Obligations, or any part thereof, shall not be paid in full when due and payable, the Administrative Agent, on behalf of the Lenders, in each case, shall have the right to proceed directly against the Guarantors, or any one or more of them, under this Agreement to collect the payment in full of the Obligations, regardless of whether or not the Administrative Agent, on behalf of the Lenders, shall have theretofore proceeded or shall then be proceeding against Borrower or any other Obligor or Collateral, if any, or any of the foregoing, it being understood that the Administrative Agent, on behalf of the Lenders, in its sole discretion, may proceed against any Obligor and any Collateral, and may exercise each right, power or privilege that the Administrative Agent or the Lenders may then have, either simultaneously or separately, and, in any event, at such time or times and as often and in such order as the Administrative Agent, on behalf of the Lenders, in its sole discretion, may from time to time deem expedient to collect the payment in full of the Obligations. The Guarantors agree that all payments made by any Guarantor under this Agreement shall be made free and clear of, and without deduction or withholding for or on account of any Taxes or Other Taxes, in accordance with Section 2.03(c) of the Term Loan Agreement.
4. Payments Conditional. Whenever the Administrative Agent or any Lender shall credit any payment to the Obligations or any part thereof, whatever the source or form of payment, the credit shall be conditional as to the Guarantors unless and until the payment shall be final and valid as to all the world. Without limiting the generality of the foregoing, the Guarantors agree that, if any check or other instrument so applied shall be dishonored by the drawer or any party thereto, or if any proceeds of Collateral or payment so applied shall thereafter be recovered by any trustee in bankruptcy or any other Person, each Lender, in each case, may reverse any entry relating thereto on its books and the Guarantors shall remain liable therefor, even if such Lender may no longer have in its possession any instrument evidencing the Obligations to which the payment in question was applied.
5. Guarantors Obligations Absolute and Unconditional. Regardless of the duration of time, regardless of whether Borrower may from time to time cease to be indebted to the Lenders, and irrespective of any act, omission or course of dealing whatsoever on the part of the Administrative Agent or any of the Lenders, each Guarantors liabilities and other obligations under this Agreement shall remain in full effect until the payment in full of the Obligations. Without limiting the generality of the foregoing:
5.1. Lenders Have No Duty to Guarantors to Make Advances or Follow Application of Proceeds. Without limiting the obligations of the Administrative Agent and the Lenders under the Term Loan Agreement, neither the Administrative Agent nor any Lender shall at any time be under any duty to any Guarantor to grant any financial accommodation to Borrower, irrespective of any duty or commitment of any of the Lenders to Borrower, or to follow or direct the application of the proceeds of any such financial accommodation;
5.2. Guarantors Waiver of Notice, Presentment. Each Guarantor waives (a) notice of the granting of any Loan to Borrower, or the incurring of any other Indebtedness by Borrower or the terms and conditions thereof, (b) presentment, demand for payment and notice of dishonor of the Obligations or any part thereof, or any other Indebtedness incurred by Borrower to any of the Lenders, (c) notice of any indulgence granted to any Obligor, and (d) any other notice to which the Guarantors might, but for this waiver, be entitled;
5.3. Lenders Rights Not Prejudiced by Action or Omission. The Administrative Agent and the Lenders, in their sole discretion, may, pursuant to the Term Loan Agreement, without any prejudice to their rights under this Agreement, at any time or times, without notice to or the consent of any Guarantor, (a) grant Borrower whatever financial accommodations that the Administrative Agent and the Lenders may from time to time deem advisable, even if Borrower might be in default in any respect and even if those financial accommodations might not constitute Indebtedness the payment of which is guaranteed hereunder, (b) assent to any renewal, extension, consolidation or refinancing of the Obligations, or any part thereof, (c) forbear from demanding security, if the Administrative Agent and the Lenders shall have the right to do so, (d) release any Obligor or Collateral or assent to any exchange of Collateral, if any, irrespective of the consideration, if any, received therefor, (e) grant any waiver or consent or forbear from exercising any right, power or privilege that the Administrative Agent and the Lenders may have or acquire, (f) assent to any amendment, deletion, addition, supplement or other modification in, to or of any writing evidencing or securing any of the Obligations or pursuant to which any of the Obligations are created, (g) grant any other indulgence to any Obligor, (h) accept any
Collateral for, or any other Obligor upon, the Obligations or any part thereof, and (i) fail, neglect or omit in any way to realize upon any Collateral, to perfect any security interest with respect to Collateral, or to protect the Obligations or any part thereof or any Collateral therefor;
5.4. Liabilities Survive the Dissolution of Any Guarantor. Each Guarantors liabilities and other obligations under this Agreement shall survive any dissolution of any Guarantor; and
5.5. Liabilities Absolute and Unconditional. Each Guarantors liabilities and other obligations under this Agreement shall be absolute and unconditional irrespective of any lack of validity or enforceability of the Term Loan Agreement, any Note, any Loan Document or any other agreement, instrument or document evidencing the Loans or related thereto, the existence of any claim, set-off or other rights that any Guarantor may have against Borrower or any other Person, or any other defense available to any Guarantor in respect of this Agreement (other than the payment in full of the Obligations).
6. Guarantors Obligations Independent. The obligations of each Guarantor hereunder are as set forth in this Agreement and are independent of the obligation of any other Guarantor or any other Obligor, and a separate action or actions may be brought and prosecuted against any Guarantor whether or not any action is brought against any other Guarantor or any other Obligor and whether or not any other Guarantor or any other Obligor is joined in any such action.
7. Term Loan Agreement Covenants. All covenants contained in Article V of the Term Loan Agreement are incorporated herein by reference and each Guarantor shall be bound hereunder by the covenants expressly applicable to such Guarantor as a Company or Loan Party, as the case may be, with the same force and effect as if such covenants and agreements, as amended from time to time in accordance with the Term Loan Agreement, were written herein.
8. Representations and Warranties. All representations and warranties made by the Borrower with respect to each Guarantor and contained in the Term Loan Agreement are incorporated herein by reference and each Guarantor hereby makes such continuing representations and warranties on its own behalf. Each Guarantor further represents and warrants to the Administrative Agent and each of the Lenders that (a) such Guarantor is duly organized or formed, as applicable, and in good standing or full force and effect (as appropriate) under the laws of the state of its incorporation or formation, as applicable (as referenced on Exhibit A hereto), and is qualified to do business in each state where a failure to so qualify would have a Material Adverse Effect; (b) such Guarantor has the legal power and right to execute and deliver this Agreement and to perform and observe the provisions hereof; (c) the officers or authorized representatives, as applicable, executing and delivering this Agreement on behalf of such Guarantor have been duly authorized to do so, and this Agreement, when executed, is legal and binding upon such Guarantor in every respect; (d) except for matters described or referenced in the Term Loan Agreement or any schedule thereto, no litigation or proceeding is pending or, to such Guarantors knowledge, threatened against such Guarantor before any court or any administrative agency that is reasonably expected to have a material adverse effect on such Guarantor; (e) such Guarantor has received consideration that is the reasonably equivalent value of the obligations and liabilities that such Guarantor has incurred to the Administrative Agent, for the benefit of the Lenders; (f) such Guarantor is not insolvent, as defined in any applicable
state or federal statute, nor will any Guarantor be rendered insolvent by the execution and delivery of this Agreement to the Administrative Agent and the Lenders; (g) such Guarantor is not engaged or about to engage in any business or transaction for which the assets retained by such Guarantor are or will be an unreasonably small amount of capital, taking into consideration the obligations to the Lenders incurred hereunder; and (h) such Guarantor does not intend to, nor does such Guarantor believe that such Guarantor will, incur debts beyond such Guarantors ability to pay such debts as they mature.
9. Events of Default. Without limiting the generality of any of the other provisions hereof, each Guarantor specifically agrees that upon the occurrence and during the continuance of an Event of Default, the Administrative Agent, on behalf of the Lenders, in its sole discretion (but subject to the terms of the Term Loan Agreement), may declare the unpaid principal balance of and accrued interest on the Obligations to be forthwith due and payable in full without notice. Upon the occurrence of certain Events of Default, the unpaid principal balance of and accrued interest on the Obligations will become due and payable without any action by the Administrative Agent or the Lenders. Upon the occurrence of any of the events enumerated in the immediately preceding sentences, the Guarantors shall, upon demand of the Administrative Agent, on behalf of the Lenders, whenever made, pay to the Administrative Agent, for the benefit of the Lenders, an amount equal to the then unpaid principal balance of and accrued interest on the Obligations (provided that no such demand shall be required in the event of an insolvency of one or more Guarantors).
10. Subordination of Guarantors Rights Against Borrower and Collateral. To the extent permitted by law, each Guarantor hereby subordinates to payment in full of the Obligations any claim or other right that such Guarantor might now have or hereafter acquire against Borrower or any other Obligor that arises from the existence or performance of such Guarantors liabilities or other obligations under this Agreement, including, without limitation, any right of subrogation, reimbursement, exoneration, contribution, indemnification, and any right to participate in any claim or remedy of the Administrative Agent or any Lender against Borrower or any Collateral that the Administrative Agent or any Lender now has or hereafter acquires, whether or not such claim, remedy or right arises in equity, or under contract, statute or common law, until such time as the Commitment has been terminated and the Obligations (other than contingent, indemnity obligations) have been repaid in full.
11. Contribution Among Guarantors. The Guarantors hereby agree as among themselves that, in connection with the payments made hereunder, each Guarantor shall have a right of contribution from each other Guarantor in accordance with applicable law. Such contribution rights shall be waived until such time as the Obligations have been irrevocably paid in full, and no Guarantor shall exercise any such contribution rights until the Obligations have been irrevocably paid in full.
12. Full Recourse Obligations; Effect of Fraudulent Transfer Laws. It is the desire and intent of each Guarantor, the Administrative Agent and the Lenders that this Agreement shall be enforced as a full recourse obligation of such Guarantor to the fullest extent permissible under the laws and public policies applied in each jurisdiction in which enforcement is sought. If and to the extent that the obligations of any Guarantor under this Agreement would, in the absence of this sentence, be adjudicated to be invalid or unenforceable because of any applicable
state or federal law relating to fraudulent conveyances or transfers, then the amount of such Guarantors liability hereunder in respect of the Obligations shall be deemed to be reduced ab initio to that maximum amount that would be permitted without causing the obligations of such Guarantor hereunder to be so invalidated.
13. Subordination by Each Guarantor of Indebtedness owed to Such Guarantor from Borrower. Each Guarantor agrees that the Obligations, whether now existing or hereafter created, shall be superior to any claim that such Guarantor may now have or hereafter acquire against Borrower, whether or not Borrower becomes insolvent. Each Guarantor hereby expressly subordinates any claim such Guarantor may have against Borrower, upon any account whatsoever, to any claim that the Administrative Agent and the Lenders may now or hereafter have against Borrower pursuant to the Term Loan Agreement and the other Loan Documents. In the event of insolvency and consequent liquidation of the assets of Borrower, through bankruptcy, by an assignment for the benefit of creditors, by voluntary liquidation, or otherwise, the assets of Borrower applicable to the payment of the claims of both the Administrative Agent and the Lenders, and any Guarantor shall be paid to the Administrative Agent, for the benefit of the Lenders, and shall be first applied by the Administrative Agent to the payment of the Obligations in accordance with the Term Loan Agreement. Each Guarantor does hereby assign to the Administrative Agent, for the benefit of the Lenders, all claims that such Guarantor may have or acquire against Borrower or against any assignee or trustee in bankruptcy of Borrower; provided that such assignment shall be effective only for the purpose of assuring to the Administrative Agent, for the benefit of the Lenders, full payment in legal tender of the Obligations. If the Administrative Agent so requests, any notes or credit agreements now or hereafter evidencing any indebtedness or obligations of Borrower to any Guarantor shall be marked with a legend that the same are subject to this Agreement and shall be delivered to the Administrative Agent. Each Guarantor agrees, and the Administrative Agent is hereby authorized, in the name of such Guarantor, from time to time to execute documents and to take such other actions as the Administrative Agent deems necessary or appropriate to preserve and enforce the Administrative Agents rights under this Agreement.
14. Guarantors Familiar with Borrowers Affairs and the Loan Documents. Each Guarantor confirms that an executed (or conformed) copy of each of the Loan Documents has been made available to its principal executive officers, that such officers are familiar with the contents thereof and of this Agreement, and that it has executed and delivered this Agreement after reviewing the terms and conditions of this Agreement, the Term Loan Agreement and the other Loan Documents, and such other information as it has deemed appropriate in order to make its own credit analysis and decision to execute and deliver this Agreement. Each Guarantor confirms that it has made its own independent investigation with respect to the creditworthiness of Borrower and its other Subsidiaries, and is not executing and delivering this Agreement in reliance on any representation or warranty by the Administrative Agent or any Lender, or any other Person acting on behalf of the Administrative Agent or any Lender, as to such creditworthiness. Each Guarantor expressly assumes all responsibilities to remain informed of the financial condition of Borrower and its other Subsidiaries, and any circumstances affecting (a) the ability of Borrower and the other Credit Parties to perform their respective obligations under the Term Loan Agreement and the other Loan Documents to which they are parties, or (b) any collateral securing, or any other guaranty for, all or any part of the payment and performance obligations of Borrower and the other Credit Parties; and each Guarantor further agrees that the
Administrative Agent and the Lenders shall have no duty to advise any Guarantor of information known to them regarding such circumstances, or the risks such Guarantor undertakes in this Agreement.
15. Stay of Acceleration. In the event that acceleration of the time for payment of any of the Obligations is stayed, upon the insolvency, bankruptcy or reorganization of Borrower or any other Person, or otherwise, the Obligations shall nonetheless be payable by the Guarantors immediately upon demand by the Administrative Agent.
16. Notice. All notices, requests, demands and other communications provided for hereunder shall be in writing and, if to a Guarantor, mailed or delivered to it, addressed to it at the address specified on the signature page of this Agreement, if to the Administrative Agent or any Lender, mailed or delivered to it, addressed to the address of the Administrative Agent or such Lender specified on the signature pages of the Term Loan Agreement, or, as to each party, at such other address as shall be designated by such party in a written notice to each of the other parties. All notices, statements, requests, demands and other communications provided for hereunder shall be deemed to be given or made when delivered (if received during a Business Day, such Business Day, or otherwise the following Business Day) or two Business Days after being deposited in the mails with postage prepaid by registered or certified mail, addressed as aforesaid, or sent by facsimile or electronic communication, in each case with telephonic or written confirmation of receipt. All notices pursuant to any of the provisions hereof shall not be effective until received.
17. Successors and Assigns. This Agreement shall bind each Guarantor and its successors and assigns and shall inure to the benefit of the Administrative Agent and each Lender and their respective successors and permitted assigns, including (without limitation) each holder of any Note evidencing any of the Obligations.
18. Invalidity. If, at any time, one or more provisions of this Agreement is or becomes invalid, illegal or unenforceable in whole or in part, the validity, legality and enforceability of the remaining provisions shall not in any way be affected or impaired thereby.
19. Entire Agreement. This Agreement constitutes a final written expression of all of the terms of this Agreement, is a complete and exclusive statement of those terms and supersedes all oral representations, negotiations and prior writings, if any, with respect to the subject matter hereof.
20. Relationship of Parties; Setoffs. The relationship between (a) each Guarantor and (b) the Administrative Agent and the Lenders with respect to this Agreement is and shall be solely that of debtor and creditors, respectively, and the Administrative Agent and the Lenders shall have no fiduciary obligation toward such Guarantor with respect to this Agreement or the transactions contemplated hereby. If and to the extent any payment is not made when due hereunder, the Administrative Agent and each Lender may setoff and charge from time to time any amount so due against any and all of such Guarantors accounts or deposits with the Administrative Agent or such Lender.
21. Headings; Execution. The headings and subheadings used herein are for convenience of reference only and shall be ignored in interpreting the provisions of this Agreement. This Agreement may be executed by facsimile or electronic signature, which, when so executed and delivered, shall be deemed to be an original.
22. Additional Guarantors. Additional Subsidiaries may become a party to this Agreement by the execution of a Guaranty of Payment Joinder and delivery of such other supporting documentation, corporate governance and authorization documents as may be required by the Term Loan Agreement. At the option of the Administrative Agent, a Subsidiary may also become a Guarantor of Payment under the Term Loan Agreement pursuant to a separate Guaranty of Payment executed by such Subsidiary.
23. General Limitation on Claims by Guarantors. NO CLAIM MAY BE MADE BY ANY GUARANTOR AGAINST THE ADMINISTRATIVE AGENT OR ANY LENDER, OR THE AFFILIATES, DIRECTORS, OFFICERS, EMPLOYEES, ATTORNEYS OR AGENTS OF ANY OF THEM, FOR ANY DAMAGES OTHER THAN ACTUAL COMPENSATORY DAMAGES IN RESPECT OF ANY CLAIM FOR BREACH OF CONTRACT OR ANY OTHER THEORY OF LIABILITY ARISING OUT OF OR RELATED TO THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT OR ANY OF THE OTHER LOAN DOCUMENTS, OR ANY ACT, OMISSION OR EVENT OCCURRING IN CONNECTION THEREWITH; AND EACH GUARANTOR HEREBY, TO THE FULLEST EXTENT PERMITTED UNDER APPLICABLE LAW, WAIVES, RELEASES AND AGREES NOT TO SUE OR COUNTERCLAIM UPON ANY SUCH CLAIM FOR ANY SPECIAL, CONSEQUENTIAL OR PUNITIVE DAMAGES, WHETHER OR NOT ACCRUED AND WHETHER OR NOT KNOWN OR SUSPECTED TO EXIST IN ITS FAVOR.
24. Attorneys, Accountants and Other Agents of Lenders Have No Duty to Guarantors. All attorneys, accountants, appraisers, consultants and other professional Persons (including the firms or other entities on behalf of which any such Person may act) retained by the Administrative Agent or any Lender with respect to the transactions contemplated by the Loan Documents shall have the right to act exclusively in the interest of the Administrative Agent or such Lender, as the case may be, shall have no duty of disclosure, duty of loyalty, duty of care, or other duty or obligation of any type or nature whatsoever to any Guarantor, to any of its Affiliates, or to any other Person, with respect to any matters within the scope of such representation or related to their activities in connection with such representation and shall be subject to the provisions contained in Section 10.17 of the Term Loan Agreement. Each Guarantor agrees, on behalf of itself, its Subsidiaries and its other Affiliates, not to assert any claim or counterclaim against any such Persons with regard to such matters, all such claims and counterclaims, now existing or hereafter arising, whether known or unknown, foreseen or unforeseeable, being hereby waived, released and forever discharged.
25. Governing Law; Submission to Jurisdiction. The provisions of this Agreement and the respective rights and duties of the Guarantors, the Administrative Agent and the Lenders hereunder shall be governed by and construed in accordance with Ohio law, without regard to principles of conflicts of laws that would result in the application of the law of any other jurisdiction. Each Guarantor hereby irrevocably submits to the non-exclusive jurisdiction of any Ohio state or federal court sitting in Cleveland, Ohio, over any action or proceeding arising out
of or relating to this Agreement, any Loan Document or any Related Writing (but not for any other purpose unrelated to the foregoing), and each Guarantor hereby irrevocably agrees that all claims in respect of such action or proceeding may be heard and determined in such Ohio state or federal court. With respect to the foregoing, each Guarantor, on behalf of itself and its Subsidiaries, hereby irrevocably waives, to the fullest extent permitted by law, any objection such Guarantor may now or hereafter have to the laying of venue in any such action or proceeding in any such court as well as any right such Guarantor may now or hereafter have to remove such action or proceeding, once commenced, to another court on the grounds of FORUM NON CONVENIENS or otherwise. Each Guarantor agrees that a final, nonappealable judgment in any such action or proceeding in any state or federal court in the State of Ohio shall be conclusive and may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by law.
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JURY TRIAL WAIVER. EACH GUARANTOR, TO THE EXTENT PERMITTED BY LAW, HEREBY WAIVES ANY RIGHT TO HAVE A JURY PARTICIPATE IN RESOLVING ANY DISPUTE, WHETHER SOUNDING IN CONTRACT, TORT, OR OTHERWISE, AMONG THE ADMINISTRATIVE AGENT, THE LENDERS, BORROWER AND THE GUARANTORS, OR ANY THEREOF, ARISING OUT OF, IN CONNECTION WITH, RELATED TO, OR INCIDENTAL TO THE RELATIONSHIP ESTABLISHED AMONG THEM IN CONNECTION WITH THIS AGREEMENT OR ANY NOTE OR OTHER AGREEMENT, INSTRUMENT OR DOCUMENT EXECUTED OR DELIVERED IN CONNECTION THEREWITH OR THE TRANSACTIONS RELATED THERETO.
IN WITNESS WHEREOF, the undersigned have executed and delivered this Guaranty of Payment at Cleveland, Ohio as of the date first set forth above.
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EXHIBIT A
GUARANTORS
[To Be Completed.]
EXHIBIT B
FORM OF
GUARANTY OF PAYMENT JOINDER
This GUARANTY OF PAYMENT JOINDER (as the same may from time to time be amended, restated, supplemented or otherwise modified, this Agreement), is made as of the [ ] day of [ , ] by [ ], a[n] [ ] [ ] (New Guarantor), in favor of PNC BANK, NATIONAL ASSOCIATION, as the administrative agent (the Administrative Agent), for the benefit of the Lenders (as hereinafter defined).
1. Recitals.
NORDSON CORPORATION, an Ohio corporation (Borrower), and each Guarantor of Payment, as defined in the Term Loan Agreement, as hereinafter defined, entered into that certain Term Loan Agreement, dated as of February 21, 2017, with the lenders from time to time party thereto (together with their respective successors and assigns and any other additional lenders that become party to the Term Loan Agreement, collectively, the Lenders and, individually, each a Lender), and the Administrative Agent (as the same may from time to time be amended, restated or otherwise modified, the Term Loan Agreement).
WHEREAS, in connection with the Term Loan Agreement, each Guarantor of Payment (collectively, Guarantors and, individually, each a Guarantor) entered into that certain Guaranty of Payment, dated as of 20 (as the same may from time to time be amended, restated or otherwise modified, the Guaranty of Payment), pursuant to which Guarantors jointly and severally guaranteed the payment of the Obligations, as defined in the Guaranty of Payment;
WHEREAS, New Guarantor, a subsidiary of Borrower, deems it to be in the direct pecuniary and business interests of New Guarantor that Borrower continue to obtain from the Lenders the financial accommodations provided for in the Term Loan Agreement;
WHEREAS, New Guarantor understands that the Lenders are willing to continue to grant such financial accommodations only upon certain terms and conditions, one of which is that New Guarantor guaranty the payment of the Obligations, and this Agreement is being executed and delivered in consideration of each financial accommodation granted to Borrower by the Lenders, and for other valuable consideration;
WHEREAS, pursuant to Section 5.15 of the Term Loan Agreement and Section 22 of the Guaranty of Payment, New Guarantor has agreed that, effective on [ ], [ ] (the Joinder Effective Date), New Guarantor shall become a party to the Guaranty of Payment and shall become a Guarantor thereunder; and
WHEREAS, except as specifically defined herein, capitalized terms used herein that are defined in the Guaranty of Payment shall have their respective meanings ascribed to them in the Guaranty of Payment;
NOW, THEREFORE, in consideration of the benefits accruing to New Guarantor, the receipt and sufficiency of which are hereby acknowledged, New Guarantor hereby makes the following representations and warranties to the Administrative Agent and the Lenders, covenants to the Administrative Agent and the Lenders, and agrees with the Administrative Agent as follows:
Section 1. Assumption and Joinder. On and after the Joinder Effective Date:
(a) New Guarantor hereby irrevocably and unconditionally assumes, agrees to be liable for, and agrees to perform and observe, each and every one of the covenants, rights, promises, agreements, terms, conditions, obligations, appointments, duties and liabilities of a Guarantor under the Guaranty of Payment and all of the other Loan Documents (as defined in the Term Loan Agreement) applicable to it as a Guarantor under the Guaranty of Payment;
(b) New Guarantor shall become bound by all representations, warranties, covenants, provisions and conditions of the Guaranty of Payment and each other Loan Document applicable to it as a Guarantor under the Guaranty of Payment, as if New Guarantor had been the original party making such representations, warranties and covenants; and
(c) all references to the term Guarantor in the Guaranty of Payment or in any other Loan Document, or in any document or instrument executed and delivered or furnished, or to be executed and delivered or furnished, in connection therewith shall be deemed to be a reference to, and shall include, New Guarantor.
Section 2. Guaranty of the Obligations. New Guarantor hereby absolutely and unconditionally guarantees (as a guaranty of payment and not merely a guaranty of collection) the prompt payment in full of all of the Obligations as and when the respective parts thereof become due and payable.
Section 3. Representations and Warranties of New Guarantor. New Guarantor hereby represents and warrants to the Administrative Agent and each Lender that:
(a) New Guarantor has the requisite corporate power and authority to enter into this Agreement and to perform its obligations hereunder and under the Guaranty of Payment and any other Loan Document to which it is a party. The execution, delivery and performance of this Agreement by New Guarantor and the performance of its obligations under this Agreement, the Guaranty of Payment, and any other Loan Document have been duly authorized by New Guarantor and no other corporate proceedings on the part of New Guarantor are necessary to authorize the execution, delivery or performance of this Agreement, the transactions contemplated hereby or the performance of its obligations under this Agreement, the Guaranty of Payment or any other Loan Document. This Agreement has been duly executed and delivered by New Guarantor. This Agreement, the Guaranty of Payment and each Loan Document constitutes the legal, valid and binding obligation of New Guarantor enforceable against it in accordance with its respective terms, except as enforceability may be limited by applicable bankruptcy, insolvency, reorganization or similar laws affecting creditors rights generally and by general principles of equity, whether such enforceability is considered in a proceeding at law or in equity.
(b) Each of the representations and warranties set forth in the Guaranty of Payment are true and correct in all material respects on as and as of the date hereof as such representations and warranties apply to New Guarantor (except such representations and warranties that are qualified by materiality, which shall be true and correct in all respects) (except to the extent that any such representations and warranties relates to an earlier date or period, in which case such representations and warranties shall have been true and correct in all material respects on and as of such earlier date or period (except such representations and warranties that are qualified by materiality, which shall be true and correct in all respects on and as of such earlier date or period)).
Section 4. Further Assurances. At any time and from time to time, upon the Administrative Agents request and at the sole expense of New Guarantor, New Guarantor will promptly and duly execute and deliver to the Administrative Agent any and all further instruments and documents and take such further action as the Administrative Agent reasonably deems necessary or appropriate to effect the purposes of this Agreement, the Guaranty of Payment or the Term Loan Agreement.
Section 5. Notice. All notices, requests, demands and other communications to New Guarantor provided for under the Guaranty of Payment and any other Loan Document shall be addressed to New Guarantor at the address specified on the signature page of this Agreement, or at such other address as shall be designated by New Guarantor in a written notice to the Administrative Agent and the Lenders.
Section 6. Binding Nature of Agreement. All provisions of the Guaranty of Payment and the other Loan Documents shall remain in full force and effect and be unaffected hereby. This Agreement is a Related Writing as defined in the Term Loan Agreement. This Agreement shall be binding upon New Guarantor and shall inure to the benefit of the Administrative Agent and the Lenders, and their respective successors and permitted assigns.
Section 7. Miscellaneous. This Agreement may be executed by facsimile or electronic signature, which, when so executed and delivered, shall be deemed to be an original.
Section 8. Governing Law. This Agreement shall be construed in accordance with, and governed by, the laws of the State of Ohio, without regard to principles of conflicts of laws.
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JURY TRIAL WAIVER. NEW GUARANTOR HEREBY WAIVES ANY RIGHT TO HAVE A JURY PARTICIPATE IN RESOLVING ANY DISPUTE, WHETHER SOUNDING IN CONTRACT, TORT, OR OTHERWISE, AMONG NEW GUARANTOR, BORROWER, GUARANTORS, THE ADMINISTRATIVE AGENT AND THE LENDERS, OR ANY THEREOF, ARISING OUT OF, IN CONNECTION WITH, RELATED TO, OR INCIDENTAL TO THE RELATIONSHIP ESTABLISHED AMONG THEM IN CONNECTION WITH THIS AGREEMENT OR ANY OTHER NOTE OR OTHER INSTRUMENT, DOCUMENT OR AGREEMENT EXECUTED OR DELIVERED IN CONNECTION HEREWITH OR THE TRANSACTIONS RELATED THERETO.
IN WITNESS WHEREOF, the undersigned have executed and delivered this Guaranty of Payment Joinder as of the date first written above.
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