Exhibit 10.1
WAIVER AGREEMENT
THIS
WAIVER AGREEMENT (this
"Agreement"), dated as
of August 8, 2005, is
entered into among CURATIVE HEALTH SERVICES, INC., a Minnesota corporation
formerly known as Curative Holding Co. ("Holdings"), EBIOCARE.COM, INC., a
Delaware corporation ("eBioCare"), HEMOPHILIA ACCESS, INC., a Tennessee
corporation ("Hemophilia Access"), APEX THERAPEUTIC CARE, INC., a California
corporation ("Apex"), CHS SERVICES, INC., a Delaware corporation ("CHS"),
CURATIVE HEALTH SERVICES OF NEW YORK,
INC., a New York
corporation
("CHSNY"),
OPTIMAL CARE PLUS, INC., a Delaware corporation ("Optimal Care"), INFINITY
INFUSION, LLC, a Delaware limited liability company ("Infinity"), INFINITY
INFUSION II, LLC, a Delaware limited
liability company ("Infinity II"), INFINITY
INFUSION CARE, LTD., a Texas limited
partnership ("Infinity Infusion"), MEDCARE,
INC., a Delaware corporation ("Medcare"), CURATIVE PHARMACY SERVICES,
INC., a
Delaware corporation ("CPS"), CURATIVE HEALTH SERVICES CO., a Minnesota
corporation formerly known as Curative
Health Services, Inc. ("CHSC"), CRITICAL
CARE SYSTEMS, INC., a Delaware corporation ("CCS") (Holdings, eBioCare,
Hemophilia Access, Apex, CHS, CHSNY, Optimal Care, Infinity, Infinity II,
Infinity Infusion, Medcare, CPS, CHSC and CCS are sometimes collectively
referred to herein as the "Borrowers" and individually as a "Borrower"),
CURATIVE HEALTH SERVICES III CO., a
Minnesota corporation,
and GENERAL ELECTRIC
CAPITAL CORPORATION, a Delaware corporation
("GE Capital"), as Agent and Lender.
W I T N E S S E T H:
WHEREAS,
the Borrowers and GE
Capital are parties to that certain Amended
and Restated Credit Agreement, dated April 23, 2004, as amended by (i) that
certain First Amendment to Amended and
Restated Credit
Agreement and Collateral
Documents dated as of May 3, 2004, (ii)
that certain Second Amendment to Amended
and Restated Credit Agreement dated as of June 30, 2004, (iii) that certain
Third Amendment to Amended and Restated
Credit Agreement dated as of October 20,
2004 and (iv) that certain Fourth Amendment to Amended and Restated Credit
Agreement dated as of December 31, 2004 (as
so amended, the
"Credit Agreement";
capitalized terms used but not defined in
this Agreement have the meanings given
in the Credit Agreement), whereby the Lenders have made
available a
revolving
credit facility and other financial
accommodations to the Borrowers, subject to
the terms and conditions contained in the
Credit Agreement;
WHEREAS,
certain Events of Default have occurred under the Credit
Agreement prior to the date hereof, specifically (a) the failure of the
Borrowers to limit the Total Leverage Ratio to 10.75:1.00 or less as required
pursuant to Section 7.15 of the Credit
Agreement for the Fiscal Quarter ended
June 30, 2005 and (b) the failure of the
Borrowers to limit the
Senior Secured
Leverage Ratio to 1.50:1.00 or less as
required pursuant to
Section 7.16 of the
Credit Agreement for the Fiscal Quarter
ended June 30, 2005
(collectively, the
"Specified Defaults");
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WHEREAS,
the Borrowers
have requested that Agent and Lenders waive
the
Specified Defaults;
WHEREAS,
the Borrower Representative has informed GE Capital that the
Borrowers believe that they will fail to
comply with the Total
Leverage Ratio
covenant in Section 7.15 of the Credit
Agreement for each of the Fiscal Quarters
ended March 31, 2006 and June 30, 2006
(collectively, the
"Potential
Specified
Defaults"), and Borrowers have requested
that the Lenders grant a limited waiver
for non-compliance with the Total Leverage Ratio covenant for these fiscal
periods;
WHEREAS,
subject to the terms
and conditions
specified herein, Agent and
Lenders are willing to waive the Specified
Defaults and the Potential Specified
Defaults.
NOW,
THEREFORE,
in consideration of the foregoing, the respective
agreements, warranties and covenants
contained herein,
for $10 and other
good
and valuable consideration the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as
follows:
SECTION 1. ACKNOWLEDGMENTS AND
AGREEMENTS
1.1
Acknowledgment
of Obligations. Each of the Borrowers hereby
acknowledges, confirms and agrees that as of the
close of business on August 5,
2005, the Borrowers are indebted to
Lenders in respect of the Revolving Loan in
the aggregate principal amount of $27,260,201 and in respect of the
aggregate
Letter of Credit Obligations in the amount of
$225,000. All such
Obligations,
together with interest accrued and accruing
thereon, and fees,
costs, expenses
and other charges now or hereafter
payable by the
Borrowers to Lenders, are
unconditionally owing by the Borrowers to Lenders,
without offset,
defense or
counterclaim of any kind, nature or
description whatsoever.
1.2
Acknowledgment of Liens. Each Borrower hereby acknowledges, confirms
and agrees that Agent has and shall
continue to have
valid, enforceable and
perfected first-priority liens upon and security
interests in the
Collateral
granted to Agent for the benefit of the
Lenders pursuant to
the Loan Documents
or otherwise granted to or held by Agent
for the benefit of the Lenders.
1.3
Binding Effect of Documents. Each Borrower hereby acknowledges,
confirms and agrees that: (a) each of the Loan Documents has
been duly executed
and delivered to the Agent and the
Lenders by each Borrower that is intended to
be a party thereto, and each is in full force and
effect as of the date hereof,
(b) the agreements and obligations of each Borrower contained in such Loan
Documents and in this Agreement constitute the legal, valid and binding
obligations of such Borrower, enforceable against it in accordance
with their
respective terms, and no Borrower has any valid
defense to the
enforcement of
such obligations, and (c) the Agent and the
Lenders are and shall be entitled to
the rights, remedies and benefits provided for in the Loan Documents and
applicable law.
1.4
Acknowledgment
of Defaults.
Each Borrower hereby
acknowledges
and
agrees that (a) the Specified Defaults have occurred and, prior to the
effectiveness of this Agreement, are
continuing and constitute Events of Default
which entitle the Agent and the Lenders
to
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exercise their rights and remedies under
the Loan Documents,
applicable law or
otherwise, (b) Agent and the Lenders have the
presently exercisable right to
cease funding and declare the
Obligations
to be immediately due and payable
under the terms of the Loan Documents and
(c) the Potential
Specified Defaults
constitute "Defaults" under the Credit
Agreement and Agent and the Lenders have
the presently exercisable right to cease
funding, impose the Default Rate and to
exercise certain other rights as provided
in the Loan Documents.
SECTION 2. WAIVER
2.1 Waiver
of Specified Defaults.
In reliance upon the
representations,
warranties and covenants of the Borrowers contained in this Agreement, and
subject to the terms and conditions of this Agreement and any documents or
instruments executed or delivered in connection herewith, the Agent and the
Lenders hereby waive the Specified Defaults
solely for the fiscal quarter ending
June 30, 2005.
2.2
Temporary Waiver of Potential Specified Defaults. In reliance upon
the
representations, warranties and covenants of the Borrowers contained in this
Agreement, and subject to the terms and
conditions
of this Agreement and any
documents or instruments executed or
delivered in connection herewith, the Agent
and the Lenders hereby waive the Potential
Specified Defaults
solely during the
fiscal quarters ending March 31, 2006 and June 30,
2006, provided that the
Borrowers hereby covenant and agree that they shall not permit the Total
Leverage Ratio as of the last day of the
Fiscal Quarter
ending March 31,
2006
and June 30, 2006 to exceed 10.00:1.00. Notwithstanding anything herein or in
the Credit Agreement or any other Loan
Document to the
contrary, if the
Total
Leverage Ratio exceeds 10.00:1.00 as of the last day of any of the Fiscal
Quarters ending March 31, 2006 and June 30,
2006, such event shall constitute an
immediate Event of Default.
2.3 No
Other Waivers; Reservation of Rights.
(a) Neither the Agent nor any other Lender has waived, or is by
this
Agreement waiving, (i) any Default or Event of
Default which may be continuing
on the date hereof (other than the Specified Defaults and the potential
Specified Defaults, in each case to the extent
expressly set forth
herein) or
(ii) any Default or Event of Default which
may hereafter arise (whether similar
to the Specified Defaults , Potential Specified Defaults or otherwise),
including, without limitation, any failure by the Borrowers to comply with
Section 7.15 or Section 7.16 of the Credit Agreement for any Fiscal Quarter
ended prior to or after June 30, 2005
(specifically
excluding the Potential
Specified Defaults).
(b) The Agent and the Lenders reserve the right, in their
discretion, to exercise any or all of their
rights and remedies under the Credit
Agreement and the other Loan Documents as a result of any Default or
Event of
Default (other than the Specified Defaults
and the Potential Specified Defaults,
in each case to the extent expressly set forth herein) which may be
continuing
on the date hereof or any Default or Event
of Default (other than
the Specified
Defaults and the Potential Specified Defaults, in each case to the extent
expressly set forth herein) which may occur after the
date hereof, and
nothing
in this Agreement, and no delay on the part of the
Agent or any Lender in
exercising any such right or remedy,
shall be construed as
a waiver of any such
right or remedy.
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SECTION 3. CONDITIONS TO EFFECTIVENESS
3.1 This
Agreeme
