AMENDMENT AND WAIVER
AGREEMENT
This Amendment and
Waiver Agreement (“ Agreement ”) is made as of
the 6th day of March, 2009 by and among Allion Healthcare, Inc.
(“ Allion ”), Biomed Healthcare, Inc., Access
Therapeutics, Inc., Atlas Respiratory Services, Inc., Biomed
California, Inc. (“ BioMed CA ”), Biomed
Florida, Inc., Biomed Kansas, Inc., Biomed PA, Inc., Biomed
Pharmaceuticals, Inc., Biomed Texas, Inc., Access Healthcare
Services, LLC, Moms Pharmacy of Brooklyn, Inc., Moms Pharmacy,
Inc., Moms Pharmacy, Inc., Mail Order Meds of Florida, LLC, Oris
Health, Inc., North American Home Health Supply, Inc., Medicine
Made Easy and Specialty Pharmacies, Inc. (together with Allion and
Biomed CA, collectively, the “ Borrowers ” and
each individually referred to as a “ Borrower
”), the financial institutions listed as lenders on the
signature pages hereto (collectively, the “ Lenders
”), and CIT Healthcare LLC, as administrative agent (“
Agent ”).
A. Borrowers,
Agent and Lenders are parties to that certain Credit and Guaranty
Agreement dated as of April 4, 2008 (as amended, modified,
restated and supplemented from time to time, including by that
certain letter agreement executed by Borrowers, Agent and Lenders
dated June 25, 2008, the “ Credit Agreement
”) pursuant to which Borrowers established certain financing
arrangements with Lenders. All capitalized terms not otherwise
defined herein shall have the meaning ascribed thereto in the
Credit Agreement.
B. Borrowers
acknowledge that Borrowers failed to promptly notify Agent of the
Application Denial (as defined below) pursuant to Section 6.03
of the Credit Agreement and (ii) that the Application Denial
may have resulted in certain misrepresentations being made with
respect to those representations contained in
Sections 5.07(b), 5.16, 5.26, 5.28 and 5.29(ii) as they may be
impacted by the denial by the Department of Health Care Services of
the State of California (“ DHCS ”) of the change
of ownership application submitted by BioMed CA with respect to a
pharmacy acquired by BioMed in July, 2007 (the “
Application Denial ”) corresponding to the change of
ownership filed by Allion and BioMed CA as the case may be on
July 18, 2007 and April 29, 2008 respectively.
C. Borrowers
have requested and Agent and Lenders have agreed to waive the
consequences of such failures and possible misrepresentations
relating to the Application Denial and amend certain terms and
conditions of the Credit Agreement pursuant to the terms and
conditions of this Agreement.
NOW, THEREFORE,
with the foregoing Background incorporated by reference and made a
part hereof and intending to be legally bound, the parties agree as
follows:
1.
Waivers . Upon the effectiveness of this Agreement, Agent
and Lenders hereby waive (a) Borrowers’ failure to
notify Agent of the Application Denial under Section 6.03 of
the Credit Agreement and (b) any misrepresentations under
Sections 5.07(b), 5.16, 5.26, 5.28 and 5.29(ii) of the Credit
Agreement solely with respect to any matters relating to and
impacted by the Application Denial; provided, however, the waiver
in this clause (b) shall not apply to any representation
regarding any event, circumstance or condition which now or in the
future could reasonably be expected to have a Material Adverse
Effect. Such waiver shall in no way constitute a waiver of any
other failure to comply with any provision of the Credit Agreement
which may have
occurred but
which is not specifically referenced in this Agreement, nor shall
it obligate Agent or any Lender to provide any waiver of, or other
accommodation with respect to, any other such failure (whether
similar or dissimilar, including, without limitation, (i) a
failure to comply with Section 6.03 and/or
Section 9.01(d) of the Credit Agreement, (ii) any Events
of Default resulting from a final non-appealable judgment from a
court of competent jurisdiction upholding and/or affirming (or
failing to overturn or reverse in full) the Application Denial
and/or (iii) any other actions taken by or on behalf of any
Governmental Authority, including, without limitation, DHCS or any
intermediary against the Borrowers, or any of them, including,
without limitation, any action or request seeking repayment,
disgorgement or recoupment of any amounts paid by or on behalf of
DHCS or any intermediary or imposing any fines or penalties as a
result of, or in connection with, the Application
Denial).
2.
Default . Upon the effectiveness of this Agreement, the
following shall constitute an Event of Default under the Credit
Agreement: any request or demand for repayment, recoupment or
disgorgement in an amount in excess of $2,000,000 relating to, or
in connection with, the Application Denial is paid, made, requested
or assessed against any Loan Party; provided, that, such request,
demand or assessment is based on a final non-appealable judgment,
determination or finding from a court or other Governmental
Authority (including, without limitation, DHCS or any
intermediary).
3.
Representations and Warranties . Each Borrower represents
and warrants to Agent and each Lender that:
(a) Assuming
the effectiveness of this Agreement, all warranties and
representations made to Lender under the Credit Agreement and the
Loan Documents are true and correct as to the date
hereof.
(b) Except
for the enrollment in MediCal for BioMed CA and the related matter
regarding a change of ownership in connection with the Target
Merger that has been consolidated with it (“ BioMed
MediCal Matter ”), each Borrower that seeks reimbursement
under Medicare or Medicaid is currently enrolled and participates
in the Medicare and state Medicaid programs of the jurisdictions in
which such Borrower operates.
(c) No
penalty, sanction, fine or restriction has been currently assessed
or imposed upon any Borrower, nor has any claim for repayment,
disgorgement or recoupment of amounts paid to or on behalf of
BioMed CA or any other
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