Attached files
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EX-2.1 - EX-2.1 - MEDASSETS INC | g24660exv2w1.htm |
EX-99.1 - EX-99.1 - MEDASSETS INC | g24660exv99w1.htm |
8-K - FORM 8-K - MEDASSETS INC | g24660e8vk.htm |
Exhibit
10.1
Barclays Capital 745 Seventh Avenue New York, New York 10019 |
JPMorgan Chase Bank, N.A. J.P. Morgan Securities LLC 383 Madison Avenue New York, New York 10179 |
CONFIDENTIAL
September 14, 2010
MedAssets, Inc.
100 North Point Center, East; Suite 200
Alpharetta, GA 30022
100 North Point Center, East; Suite 200
Alpharetta, GA 30022
Attention: L. Neil Hunn, Chief Financial Officer
Project Barracuda
Commitment Letter
Commitment Letter
Ladies and Gentlemen:
You have advised Barclays Bank PLC (Barclays Bank) and Barclays Capital, the investment
banking division of Barclays Bank PLC (Barclays Capital), JPMorgan Chase Bank, N.A. (JPMCB),
J.P. Morgan Securities LLC (J.P. Morgan and, together with Barclays Bank, Barclays Capital, JPMCB
and J.P. Morgan Securities LLC, we, us or the Commitment Parties), that MedAssets, Inc.
(MedAssets or you), intends to acquire (the Acquisition), directly or indirectly, all of the
capital stock of Broadlane Intermediate Holdings, Inc. (the Company). You have further advised
us that, in connection with the foregoing, you intend to consummate the other Transactions
described in the Transaction Description attached hereto as Exhibit A (the Transaction
Description). Capitalized terms used but not defined herein shall have the meanings assigned to
them in the Fee Letter (as defined below), the Transaction Description or the Summaries of
Principal Terms and Conditions attached hereto as Exhibits B and C (collectively, the Term
Sheets; this commitment letter, the Transaction Description, the Term Sheets and the Summary of
Additional Conditions attached hereto as Exhibit D, collectively, the Commitment Letter).
1.
Commitments.
In connection with the Transactions, (a) Barclays Bank is pleased to advise you of its
several, but not joint, commitment to provide 50% of the entire aggregate principal amount of (i)
the Senior Secured Facilities (and a like percentage of each of the Term Facilities and the
Revolving Facility) and (ii) the Bridge Facility, (b) JPMCB is pleased to advise you of its
several, but not joint, commitment to provide 50% of the entire aggregate principal amount of (i)
the Senior Secured Facilities (and a like percentage of each of the Term Facilities and the
Revolving Facility) and (ii) the Bridge Facility. Each of Barclays Bank and JPMCB, in its
capacity as a provider of a commitment in respect of (i) the Senior Secured Facilities in
accordance with the immediately preceding sentence, is referred to herein as an Initial Senior
Lender and (ii) the Bridge Facility in accordance with the immediately preceding sentence, is
referred to herein as an Initial Bridge Lender. the Initial Bridge Lenders and the Initial Senior
Lenders are collectively referred to herein as the Initial Lenders.
The commitments of each Initial Senior Lender and each Initial Bridge Lender set forth in the
immediately preceding two paragraphs are, in each case, subject only to the satisfaction of the
conditions set forth in Section 6 hereof and the section entitled Conditions to All Borrowings in
Exhibits B and C hereto (limited on the Closing Date (as defined below) as indicated therein) and
in Exhibit D hereto.
2.
Titles and Roles.
It is agreed that (a) each of Barclays Capital and J.P. Morgan will act as joint lead
arrangers and joint bookrunners for the Senior Secured Facilities (the Senior Lead Arrangers),
(b) each of J.P. Morgan and Barclays Capital will act as joint lead arrangers and joint bookrunners
for the Bridge Facility (the Bridge Lead Arrangers and together with the Senior Lead Arrangers,
the Joint Lead Arrangers), (c) Barclays Bank will act as administrative agent and collateral
agent (in such capacity, the Senior Administrative Agent) for the Senior Secured Facilities and
(d) JPMCB will act as administrative agent (in such capacity, the Bridge Administrative Agent)
for the Bridge Facility. It is further agreed that Barclays Capital shall have left side
designation and shall appear on the top left of any Information Materials (as defined below) for
the Senior Secured Facilities and all other offering or marketing materials in respect of the
Senior Secured Facilities and that J.P. Morgan shall have left side designation and shall appear
on the top left of any Information Materials (as defined below) for the Bridge Facility and all
other offering or marketing materials in respect of the Bridge Facility. You agree that no other
agents, co-agents, arrangers or bookrunners will be appointed, no other titles will be awarded and
no compensation (other than compensation expressly contemplated by this Commitment Letter and the
Fee Letter referred to below) will be paid to any Lender (as defined below) in order to obtain its
commitment to participate in the Credit Facilities unless you and we shall so agree; provided that
you shall have the right to appoint one or more additional financial institutions that agree to
assume a portion of the commitments in respect of the Credit Facilities (in which case, the
commitments of each Initial Lender shall be reduced on a pro rata basis by the amount of the
commitments so assumed by such third party(s)) to act as co-managers for the Credit Facilities on
terms to be mutually agreed between you and the Commitment Parties and to allocate up to an
aggregate of 10% of the economics in respect of the Credit Facilities to such additional financial
institutions.
3.
Syndication.
The Joint Lead Arrangers reserve the right, prior to or after the Closing Date, to syndicate
all or a portion of the Initial Lenders commitments hereunder to a group of banks, financial
institutions and other institutional lenders and investors (together with the Initial Lenders, the
"Lenders) identified by the Joint Lead Arrangers in consultation with you and you agree to use
commercially reasonable efforts to provide the Initial Lenders with a period of 20 consecutive
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business days following the delivery of the Information Memorandum (as defined below) for the
Credit Facilities and prior to the Closing Date to syndicate the Credit Facilities (which period
shall either end prior to December 18, 2010 or commence after January 3, 2011); provided that (a)
we agree not to syndicate our commitments in respect of the Facilities to certain banks, financial
institutions and other institutional lenders and competitors of you, the Company or your respective
subsidiaries that have been specified to us by you in writing at any time prior to the date hereof
(Disqualified Lenders) and (b) notwithstanding the Joint Lead Arrangers right to syndicate the
Credit Facilities and receive commitments with respect thereto, (i) no Initial Lender shall be
relieved, released or novated from its obligations hereunder (including its obligation to fund the
Senior Secured Facilities and, if applicable, the Bridge Facility on the date of the consummation
of the Acquisition with the proceeds of the initial funding under the Senior Secured Facilities
and, if applicable, the Bridge Facility (the date of such funding, the Closing Date)) in
connection with any syndication, assignment or participation of the Credit Facilities, including
its commitments in respect thereof, until after the Closing Date has occurred, (ii) no assignment
or novation shall become effective with respect to all or any portion of any Initial Lenders
commitments in respect of the Credit Facilities until the initial funding of the Senior Secured
Facilities and, if applicable, the Bridge Facility on the Closing Date (it being understood that to
the extent Notes are issued in lieu of the Bridge Facility or a portion thereof, the amount of the
Bridge Facility shall be correspondingly reduced) and (iii) unless you otherwise agree in writing,
each Initial Lender shall retain exclusive control over all rights and obligations with respect to
its commitments in respect of the Credit Facilities, including all rights with respect to consents,
modifications, supplements, waivers and amendments, until the Closing Date has occurred.
Without limiting your obligations to assist with syndication efforts as set forth herein, it
is understood that the Initial Lenders commitments hereunder are not conditioned upon the
syndication of, or receipt of commitments in respect of, the Credit Facilities and in no event
shall the commencement or successful completion of syndication of the Credit Facilities constitute
a condition to the availability of the Credit Facilities on the Closing Date. The Joint Arrangers
intend to commence syndication efforts promptly upon the execution of this Commitment Letter and as
part of their syndication efforts, it is their intent to have Lenders commit to the Credit
Facilities prior to the Closing Date (subject to the limitations set forth in the preceding
paragraph). Until the earlier of (i) the date upon which a Successful Syndication (as defined in
the Fee Letter referred below) of the Credit Facilities is achieved and (ii) the 90th day following
the Closing Date (the Syndication Date), you agree actively to assist the Joint Lead Arrangers in
completing a timely syndication that is reasonably satisfactory to the Joint Lead Arrangers and
you. Such assistance shall include, without limitation, (a) your using commercially reasonable
efforts to ensure that any syndication efforts benefit materially from your and the Companys
existing lending and investment banking relationships, (b) direct contact between senior
management, representatives and advisors of yours, on the one hand, and the proposed Lenders, on
the other hand, (and your using commercially reasonable efforts to ensure such contact between
senior management of the Company, on the one hand, and the proposed Lenders, on the other hand), in
all such cases at times mutually agreed upon, (c) your assistance (including the use of
commercially reasonable efforts to cause the Company to assist) in the preparation of the
Information Materials and other customary offering and marketing materials to be used in connection
with the syndication (including, without limitation, the MedAssets Model (as defined in Exhibit B))
and in any event, prior to the Closing Date, (d) obtaining, at your expense, at least
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20 business days prior to the Closing Date, ratings for the Credit Facilities and the Notes
from each of Standard & Poors Ratings Services (S&P) and Moodys Investors Service, Inc.
(Moodys) and a public corporate credit rating and a public corporate family rating in respect of
the Borrower (as defined in Exhibit B) after giving effect to the Transactions from each of S&P and
Moodys, respectively, (e) the hosting, with the Joint Lead Arrangers, of a reasonable number of
meetings to be mutually agreed upon of prospective Lenders at times and locations to be mutually
agreed upon (and your using commercially reasonable efforts to cause certain officers of the
Company to be available for such meetings) and (f) there being no competing issues, offerings,
placements or arrangements of debt securities or commercial bank or other credit facilities by or
on behalf of you, the Company or any of your or its subsidiaries being offered, placed or arranged
(other than the Credit Facilities, the Notes (or any other debt securities issued to refinance the
Bridge Facility in whole or in part) or any indebtedness of the Company and its subsidiaries
permitted to be incurred pursuant to the Purchase Agreement) without the consent of the Joint Lead
Arrangers, if such issuance, offering, placement or arrangement could reasonably be expected to
impair the primary syndication of the Credit Facilities or the offering of the Notes in any
material respect. Notwithstanding anything to the contrary contained in this Commitment Letter or
the Fee Letter or any other letter agreement or undertaking concerning the financing of the
Transactions to the contrary, the obtaining of the ratings referenced above shall not constitute a
condition to the commitments hereunder or the funding of the Credit Facilities on the Closing Date.
The Joint Lead Arrangers, in their capacities as such, will manage, in consultation with you,
all aspects of any syndication of the Credit Facilities, including decisions as to the selection of
institutions to be approached and when they will be approached, when their commitments will be
accepted, which institutions will participate (excluding Disqualified Lenders), the allocation of
the commitments among the Lenders and the amount and distribution of fees among the Lenders. To
assist the Joint Lead Arrangers in their syndication efforts, you agree to promptly prepare and
provide (and to use commercially reasonable efforts to cause the Company to provide) to the Joint
Lead Arrangers all customary information with respect to you, the Company and each of your and its
respective subsidiaries and the Transactions, including all financial information and projections
prepared by you (including financial estimates, forecasts and other forward-looking information,
the Projections), as the Joint Lead Arrangers may reasonably request in connection with the
structuring, arrangement and syndication of the Credit Facilities.
You hereby acknowledge that (a) the Joint Lead Arrangers will make available Information (as
defined below), Projections and other offering and marketing material and presentations, including
confidential information memoranda to be used in connection with the syndication of the Credit
Facilities (the Information Memorandum) (such Information, Projections, other offering and
marketing material and the Information Memorandum, collectively, with the Term Sheets, the
"Information Materials) on a customary confidential basis to the proposed syndicate of Lenders by
posting the Information Materials on Intralinks, Debt X, SyndTrak Online or by similar electronic
means and (b) certain of the Lenders may be public side Lenders (i.e. Lenders that do not wish to
receive material non-public information (MNPI) with respect to you, the Company or its respective
securities and who may be engaged in investment and other market related activities with respect to
you or the Company or your or the Companys respective securities) (each, a Public Sider and each
Lender that is not a Public Sider, a Private Sider). You will be solely responsible for the
contents of the Information
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Materials and each of the Commitment Parties shall be entitled to use and rely upon the
information contained therein without responsibility for independent verification thereof.
You agree to assist (and to use commercially reasonable efforts to cause the Company to
assist) us in preparing an additional version of the Information Materials to be used in connection
with the syndication of the Credit Facilities that consists exclusively of information of a type
that is publicly available and/or does not include MNPI with respect to you or the Company or any
of your or the Companys respective subsidiaries for the purpose of United States federal and state
securities laws to be used by Public Siders. The information to be included in the additional
version of the Information Materials will be substantially consistent with the information that
would be included in any offering memorandum for the offering of the Notes and in filings made by
you or the Company with the Securities and Exchange Commission. It is understood that in
connection with your assistance described above, you shall provide us with customary authorization
letters for inclusion in any Information Materials that authorize the distribution thereof to
prospective Lenders, represent that the additional version of the Information Materials does not
include any MNPI and exculpate you, the Company and us with respect to any liability related to the
use of the contents of the Information Materials or related offering and marketing materials by the
recipients thereof. Before distribution of any Information Materials, you agree to identify that
portion of the Information Materials that may be distributed to the Public Siders as Public
Information, which, at a minimum, shall mean that the word PUBLIC shall appear prominently on
the first page thereof. By marking Information Materials as PUBLIC, you shall be deemed to have
authorized the Commitment Parties and the proposed Lenders to treat such Information Materials as
not containing any MNPI (it being understood that you shall not be under any obligation to mark the
Information Materials PUBLIC).
You acknowledge and agree that the following documents, without limitation, may be distributed
to both Private Siders and Public Siders, unless you advise the Joint Lead Arrangers in writing
(including by email) within a reasonable time prior to their intended distribution that such
materials should only be distributed to Private Siders: (a) administrative materials prepared by
the Joint Lead Arrangers for prospective Lenders (such as a lender meeting invitation, bank
allocation, if any, and funding and closing memoranda), (b) term sheets and notification of changes
in the Credit Facilities terms and conditions, (c) drafts and final versions of the Senior Secured
Facilities Documentation and the Bridge Facility Documentation and (d) publicly filed financial
statements of MedAssets and its subsidiaries. If you advise us in writing (including by email),
within a reasonable period of time prior to dissemination, that any of the foregoing should be
distributed only to Private Siders, then Public Siders will not receive such materials without your
consent.
4. Information.
You hereby represent and warrant that, (a) all written information and written data, other
than (i) the Projections and (ii) information of a general economic or industry specific nature
(the Information), that has been or will be made available to any Commitment Party directly or
indirectly by you, the Company or by any of your or their respective representatives on your behalf
in connection with the transactions contemplated hereby (which information shall be to the best of
your knowledge to the extent it relates to the Company or its subsidiaries and businesses), when
taken as a whole, is or will be, when furnished, correct in all material respects
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(it being acknowledged that the Company has advised the Commitment Parties of a potential
restatement of the BGI financial statements prior to the Closing Date on the basis described in the
Purchase Agreement) and does not or will not, when furnished, contain any untrue statement of a
fact or omit to state a fact, in each case, necessary in order to make the statements contained
therein not materially misleading in light of the circumstances under which such statements are
made (giving effect to all supplements and updates provided thereto) and (b) the Projections that
have been or will be made available to any Commitment Party by you, the Company or by any of your
or their respective representatives on your behalf in connection with the transactions contemplated
hereby have been, or will be, prepared in good faith based upon assumptions that are believed by
you to be reasonable at the time prepared and at the time the related Projections are so furnished;
it being understood that the Projections are as to future events and are not to be viewed as facts,
the Projections are subject to significant uncertainties and contingencies, many of which are
beyond your control, that no assurance can be given that any particular Projections will be
realized and that actual results during the period or periods covered by any such Projections may
differ significantly from the projected results and such differences may be material. You agree
that, if at any time from the date hereof until the Syndication Date, you become aware that any of
the representations and warranties in the preceding sentence would be incorrect in any material
respect if the Information and the Projections were being furnished, and such representations were
being made, at such time, then you will promptly supplement the Information and the Projections
such that such representations and warranties are correct in all material respects under those
circumstances following such supplement. In arranging and syndicating the Credit Facilities, the
Commitment Parties (i) will be entitled to use and rely primarily on the Information and the
Projections without responsibility for independent verification thereof and (ii) do not assume
responsibility for the accuracy or completeness of the Information or the Projections.
5.
Fees.
As consideration for the commitments of the Initial Lenders hereunder and for the agreement of
the Joint Lead Arrangers to perform the services described herein, you agree to pay (or cause to be
paid) the fees set forth in the Term Sheets and in the Fee Letter dated the date hereof and
delivered herewith with respect to the Credit Facilities (the Fee Letter).
6.
Conditions.
The commitments of the Initial Lenders hereunder to fund the Credit Facilities on the Closing
Date and the agreements of the Joint Lead Arrangers to perform the services described herein are
subject solely to (a) the conditions set forth in this Section 6, (b) the conditions set forth in
the section entitled Conditions to All Borrowings in Exhibits B and C hereto and (c) the
conditions set forth in Exhibit D hereto.
Notwithstanding anything in this Commitment Letter (including each of the exhibits attached
hereto), the Fee Letter, the Facilities Documentation or any other letter agreement or other
undertaking concerning the financing of the Transactions to the contrary, (i) the only
representations relating to you, the Company and your and its respective subsidiaries and their
respective businesses the accuracy of which shall be a condition to the availability of the Credit
Facilities on the Closing Date shall be (A) such of the representations made by the Company
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with respect to the Company and its subsidiaries in the Purchase Agreement as are material to
the interests of the Lenders, but only to the extent that you have the right to terminate your
obligations under the Purchase Agreement as a result of a breach of such representations in the
Purchase Agreement (to such extent, the Specified Purchase Agreement Representations) and (B) the
Specified Representations (as defined below) and (ii) the terms of the Facilities Documentation
shall be in a form such that they do not impair the availability of the Credit Facilities on the
Closing Date if the conditions set forth in this Section 6 and the section entitled Conditions to
All Borrowings in Exhibits B and C hereto and in Exhibit D hereto are satisfied (it being
understood that, to the extent any security interest in any Collateral (as defined in Exhibit B) is
not or cannot be provided and/or perfected on the Closing Date (other than the pledge and
perfection of the security interests (1) in the equity securities of any domestic subsidiaries of
yours (to the extent required by Exhibit B) and (2) in other assets with respect to which a lien
may be perfected by the filing of a financing statement under the Uniform Commercial Code) after
your use of commercially reasonable efforts to do so, then the provision and/or perfection of a
security interest in such Collateral shall not constitute a condition precedent to the availability
of the Credit Facilities on the Closing Date, but instead shall be required to be delivered after
the Closing Date pursuant to arrangements and timing to be mutually agreed by the Senior
Administrative Agent and the Borrower acting reasonably but in any event no later than 90 days
following the Closing Date (or such later date as may be reasonably agreed between the Senior
Administrative Agent and the Borrower). For purposes hereof, Specified Representations means the
representations and warranties of the Borrower and the Guarantors set forth in the Facilities
Documentation relating to corporate existence, power and authority, due authorization, execution
and delivery and enforceability, in each case, related to, the entering into and performance of the
Facilities Documentation; solvency as of the Closing Date (after giving effect to the Transactions)
of the Borrower and its subsidiaries on a consolidated basis; Federal Reserve margin regulations;
the Investment Company Act; compliance with laws and regulations; no violation of charter
documents; subject to the parenthetical in the immediately preceding sentence and any exclusion in
the Term Sheets, creation, validity, perfection of security interests in the Collateral; and the
status of the Senior Secured Facilities and the guarantees thereof as senior debt. This paragraph,
and the provisions herein, shall be referred to as the Closing Date Conditions Provision.
7.
Indemnity.
To induce the Commitment Parties to enter into this Commitment Letter and the Fee Letter and
to proceed with the documentation of the Credit Facilities, you agree (a) to indemnify and hold
harmless each Commitment Party, their respective affiliates and the respective officers, directors,
employees, agents, controlling persons, advisors and other representatives and their successors and
permitted assigns of each of the foregoing (each, an Indemnified Person), from and against any
and all losses, claims, damages and liabilities of any kind or nature and reasonable and documented
or invoiced out-of-pocket fees and expenses, joint or several, to which any such Indemnified Person
may become subject to the extent arising out of, resulting from or in connection with, this
Commitment Letter (including the Term Sheets), the Fee Letter, the Transactions or any related
transaction contemplated hereby, the Credit Facilities or any use of the proceeds thereof or any
claim, litigation, investigation or proceeding (including any inquiry or investigation) relating to
any of the foregoing (any of the foregoing, a Proceeding), regardless of whether any such
Indemnified Person is a party thereto, whether or not such
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Proceedings are brought by you, your equity holders, affiliates, creditors or any other third
person, and to reimburse each such Indemnified Person upon demand for any reasonable and documented
or invoiced out-of-pocket legal expenses of one firm of counsel for all such Indemnified Persons,
taken as a whole and, if necessary, of a single local counsel in each appropriate jurisdiction
(which may include a single special counsel acting in multiple jurisdictions) for all such
Indemnified Persons, taken as a whole (and, in the case of an actual or perceived conflict of
interest where the Indemnified Person affected by such conflict informs you of such conflict and
thereafter retains its own counsel, of another firm of counsel for such affected Indemnified
Person) or other reasonable and documented or invoiced out-of-pocket fees and expenses incurred in
connection with investigating or defending any of the foregoing; provided that the foregoing
indemnity will not, as to any Indemnified Person, apply to losses, claims, damages, liabilities or
related expenses to the extent that they have resulted from (i) the willful misconduct or gross
negligence of such Indemnified Person or any of such Indemnified Persons affiliates or any of its
or their respective officers, directors, employees, agents, controlling persons, advisors or other
representatives (as determined by a court of competent jurisdiction in a final and non-appealable
decision) or (ii) a material breach of the obligations of such Indemnified Person or any of such
Indemnified Persons affiliates under this Commitment Letter, the Term Sheets or the Fee Letter (as
determined by a court of competent jurisdiction in a final and non-appealable decision) and (b)
whether or not the Closing Date occurs, to reimburse each Commitment Party for all reasonable and
documented out-of-pocket expenses that have been invoiced (including but not limited to expenses of
each Commitment Partys consultants fees (to the extent any such consultant has been retained with
your prior written consent (such consent not to be unreasonably withheld or delayed)), syndication
expenses, travel expenses and reasonable fees, disbursements and other charges of counsel to the
Commitment Parties identified in the Term Sheets and of a single local counsel to the Commitment
Parties in each appropriate jurisdiction (which may include a single special counsel acting in
multiple jurisdictions) and of such other counsel retained with your prior written consent (such
consent not to be unreasonably withheld or delayed), in each case incurred in connection with the
Transactions, the Credit Facilities and the preparation, negotiation and enforcement of this
Commitment Letter, the Fee Letter, the Facilities Documentation and any security arrangements in
connection therewith (collectively, the Expenses); provided, that the aggregate amount of
Expenses that shall be reimbursable by you if the Closing Date does not occur shall in no event
exceed $2,000,000. The foregoing provisions in this paragraph shall be superseded in each case, to
the extent covered thereby, by the applicable provisions contained in the Facilities Documentation
upon execution thereof and thereafter shall have no further force and effect.
Notwithstanding any other provision of this Commitment Letter, (i) no Indemnified Person shall
be liable for any damages arising from the use by others of information or other materials obtained
through internet, electronic, telecommunications or other information transmission systems, except
to the extent that such damages have resulted from the willful misconduct or gross negligence of
such Indemnified Person or any of such Indemnified Persons affiliates or any of its or their
respective officers, directors, employees, agents, advisors or other representatives (as determined
by a court of competent jurisdiction in a final and non-appealable decision) and (ii) none of we,
you, the Company or any Indemnified Person shall be liable for any indirect, special, punitive or
consequential damages (including, without limitation, any loss of profits, business or anticipated
savings) in connection with this Commitment Letter, the Fee Letter, the Transactions (including the
Credit Facilities and the use of proceeds thereunder), or
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with respect to any activities related to the Credit Facilities, including the preparation of
this Commitment Letter, the Fee Letter and the Facilities Documentation; provided that nothing
contained in this paragraph shall limit your indemnity and reimbursement obligations to the extent
set forth in the immediately preceding paragraph.
You shall not be liable for any settlement of any Proceeding effected without your consent
(which consent shall not be unreasonably withheld, conditioned or delayed), but if settled with
your written consent or if there is a final and non-appealable judgment by a court of competent
jurisdiction for the plaintiff in any such Proceeding, you agree to indemnify and hold harmless
each Indemnified Person from and against any and all losses, claims, damages, liabilities and
expenses by reason of such settlement or judgment in accordance with the other provisions of this
Section 7.
You shall not, without the prior written consent of any Indemnified Person (which consent
shall not be unreasonably withheld, conditioned or delayed), effect any settlement of any pending
or threatened proceedings in respect of which indemnity could have been sought hereunder by such
Indemnified Person unless such settlement (i) includes an unconditional release of such Indemnified
Person in form and substance reasonably satisfactory to such Indemnified Person from all liability
or claims that are the subject matter of such proceedings and (ii) does not include any statement
as to any admission of fault, culpability, wrong doing or a failure to act by or on behalf of any
Indemnified Person. It is further agreed that the Commitment Parties shall be liable in respect of
their respective Commitments to the Credit Facilities on a several, and not joint, basis.
Notwithstanding the foregoing, each Indemnified Person shall be obligated to refund and return
any and all amounts paid by you under this Section 7 to such Indemnified Person to the extent such
Indemnified Person is not entitled to payment of such amounts in accordance with the terms hereof.
8.
Confidentiality; Sharing of Information.
You agree that you will not disclose, directly or indirectly, the Fee Letter and the contents
thereof or, prior to your acceptance hereof, this Commitment Letter, the Term Sheets, the other
exhibits and attachments hereto and the contents of each thereof, or the activities of any
Commitment Party pursuant hereto or thereto, to any person or entity without prior written approval
of the Joint Lead Arrangers (such approval not to be unreasonably withheld or delayed), except (a)
to your and your subsidiaries respective officers, directors, agents, employees, attorneys,
accountants, advisors, controlling persons or equity holders on a confidential and need-to-know
basis, (b) if the Commitment Parties consent in writing to such proposed disclosure or (c) pursuant
to the order of any court or administrative agency in any pending legal, judicial or administrative
proceeding, or otherwise as required by applicable law or compulsory legal process or to the extent
requested or required by governmental and/or regulatory authorities, in each case based on the
reasonable advice of your legal counsel (in which case you agree, to the extent practicable and not
prohibited by applicable law, to inform us promptly thereof prior to disclosure); provided that (i)
you may disclose this Commitment Letter (but not the Fee Letter) and the contents hereof to the
Company, its subsidiaries and their respective officers, directors, agents, employees, attorneys,
accountants, advisors, controlling
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persons or equity holders, on a confidential and need-to-know basis, (ii) you may disclose the
Commitment Letter and its contents (but not the Fee Letter) in any offering memoranda relating to
the Notes, in any syndication or other marketing materials in connection with the Credit Facilities
or in connection with any public filing relating to the Transactions, (iii) you may disclose the
Term Sheets and the contents thereof, to potential Lenders and to rating agencies in connection
with obtaining ratings for the Credit Facilities and the Notes, (iv) you may disclose the aggregate
fee amounts contained in the Fee Letter as part of Projections, pro forma information or a generic
disclosure of aggregate sources and uses related to fee amounts related to the Transactions to the
extent customary or required in offering and marketing materials for the Credit Facilities and/or
the Notes or in any public filing relating to the Transactions and (v) to the extent portions
thereof have been redacted in a manner to be reasonably agreed by us (including the portions
thereof addressing fees payable to the Commitments Parties and/or the Lenders), you may disclose
the Fee Letter and the contents thereof to the Company, its subsidiaries and their respective
officers, directors, agents, employees, attorneys, accountants, advisors, controlling persons or
equity holders, on a confidential and need-to-know basis.
The Commitment Parties and their affiliates will use all confidential information provided to
them or such affiliates by or on behalf of you hereunder or in connection with the Acquisition and
the related Transactions solely for the purpose of providing the services which are the subject of
this Commitment Letter and shall treat confidentially all such information and shall not publish,
disclose or otherwise divulge, such information; provided that nothing herein shall prevent the
Commitment Parties and their affiliates from disclosing any such information (a) pursuant to the
order of any court or administrative agency or in any pending legal, judicial or administrative
proceeding, or otherwise as required by applicable law or compulsory legal process based on the
advice of counsel (in which case the Commitment Parties agree (except with respect to any audit or
examination conducted by bank accountants or any governmental bank regulatory authority exercising
examination or regulatory authority), to the extent practicable and not prohibited by applicable
law, to inform you promptly thereof prior to disclosure), (b) upon the request or demand of any
regulatory authority having jurisdiction over the Commitment Parties or any of their respective
affiliates (in which case the Commitment Parties agree, to the extent practicable and not
prohibited by applicable law, to inform you promptly thereof prior to disclosure), (c) to the
extent that such information becomes publicly available other than by reason of improper disclosure
by such Commitment Party or any of its affiliates or any related parties thereto in violation of
any confidentiality obligations owing to you, the Company or any of your or its respective
affiliates (including those set forth in this paragraph), (d) to the extent that such information
is received by the Commitment Parties from a third party that is not, to the Commitment Parties
knowledge, subject to contractual or fiduciary confidentiality obligations owing to you, the
Company or any of your or their respective affiliates or related parties, (e) to the extent that
such information is independently developed by the Commitment Parties, (f) to the Commitment
Parties affiliates and to its and their respective employees, legal counsel, independent auditors,
professionals and other experts or agents who need to know such information in connection with the
Transactions and who are informed of the confidential nature of such information and are or have
been advised of their obligation to keep information of this type confidential, (g) to potential or
prospective Lenders, participants or assignees and to any direct or indirect contractual
counterparty to any swap or derivative transaction relating to you or any of your subsidiaries, in
each case who agree to be bound by the terms of this paragraph (or language substantially similar
to this paragraph) or (h) for purposes of
- 10 -
establishing a due diligence defense; provided that the disclosure of any such information
to any Lenders or prospective Lenders or participants or prospective participants referred to above
shall be made on a confidential basis (on substantially the terms set forth in this paragraph or as
is otherwise reasonably acceptable to you and each Commitment Party, including, without limitation,
as agreed in any Information Materials or other marketing materials) in accordance with the
standard syndication processes of such Commitment Party or customary market standards for
dissemination of such type of information. The Commitment Parties and their affiliates, if any,
obligations under this paragraph shall terminate automatically and be superseded by the
confidentiality provisions in the definitive documentation relating to the Credit Facilities upon
the initial funding thereunder; provided that if the Closing Date does not occur, this paragraph
shall automatically terminate on the second anniversary hereof.
You acknowledge that each Commitment Party (or its affiliates) is a full service securities
firm and such person may from time to time effect transactions, for its own or its affiliates
account or the account of customers, and hold positions in loans, securities or options on loans or
securities of you, the Company, your or their respective affiliates and of other companies that may
be the subject of the transactions contemplated by this Commitment Letter. In addition, none of the
Commitment Parties and none of their respective affiliates will use confidential information
obtained from you or your affiliates or on your or their behalf by virtue of the transactions
contemplated hereby in connection with the performance by the Commitment Parties and their
respective affiliates of services for other companies or other persons and none of the Commitment
Parties or their respective affiliates will furnish any such information to any of their other
customers. You also acknowledge that the Commitment Parties and their respective affiliates have no
obligation to use in connection with the transactions contemplated hereby, or to furnish to you,
confidential information obtained from other companies or other persons.
You further acknowledge and agree that (a) no fiduciary, advisory or agency relationship
between you and the Commitment Parties is intended to be or has been created in respect of any of
the transactions contemplated by this Commitment Letter, irrespective of whether the Commitment
Parties have advised or are advising you on other matters, (b) the Commitment Parties, on the one
hand, and you, on the other hand, have an arms length business relationship that does not directly
or indirectly give rise to, nor do you rely on, any fiduciary duty on the part of the Commitment
Parties, (c) you are capable of evaluating and understanding, and you understand and accept, the
terms, risks and conditions of the transactions contemplated by this Commitment Letter, (d) you
have been advised that the Commitment Parties are engaged in a broad range of transactions that may
involve interests that differ from your interests and that the Commitment Parties have no
obligation to disclose such interests and transactions to you by virtue of any fiduciary, advisory
or agency relationship, (e) you have consulted your own legal, accounting, regulatory and tax
advisors to the extent you have deemed appropriate, (f) each Commitment Party has been, is, and
will be acting solely as a principal and, except as otherwise expressly agreed in writing by the
relevant parties, has not been, is not, and will not be acting as an advisor, agent or fiduciary
for you, any of your affiliates or any other person or entity and (g) none of the Commitment
Parties has any obligation to you or your affiliates with respect to the transactions contemplated
hereby except those obligations expressly set forth herein or in any other express writing executed
and delivered by such Commitment Party and the Borrower. You waive, to the fullest extent
permitted by law, any claims you may have against us or our affiliates for breach of fiduciary duty
or alleged breach of fiduciary duty and agree that we and our
-11-
affiliates shall have no liability (whether direct or indirect) to you in respect of such a
fiduciary duty claim or to any person asserting a fiduciary duty claim on behalf of or in right of
you, your stockholders, employees or creditors.
9.
Miscellaneous.
This Commitment Letter and the commitments hereunder shall not be assignable by any party
hereto without the prior written consent of each other party hereto (such consent not to be
unreasonably withheld or delayed) other than as permitted in connection with syndication as
permitted by Section 3 hereof (and any attempted assignment without such consent shall be null and
void). This Commitment Letter and the commitments hereunder are intended to be solely for the
benefit of the parties hereto (and Indemnified Persons) and are not intended to confer any benefits
upon, or create any rights in favor of, any person other than the parties hereto (and Indemnified
Persons to the extent expressly set forth herein). The Commitment Parties reserve the right to
employ the services of their affiliates or branches in providing services contemplated hereby and
to allocate, in whole or in part, to their affiliates or branches certain fees payable to the
Commitment Parties in such manner as the Commitment Parties and their affiliates or branches may
agree in their sole discretion and, to the extent so employed, such affiliates and branches shall
be entitled to the benefits and protections afforded to, and subject to the provisions governing
the conduct of the Commitment Parties hereunder. This Commitment Letter may not be amended or any
provision hereof waived or modified except by an instrument in writing signed by each of the
Commitment Parties and you. This Commitment Letter may be executed in any number of counterparts,
each of which shall be deemed an original and all of which, when taken together, shall constitute
one agreement. Delivery of an executed counterpart of a signature page of this Commitment Letter
by facsimile transmission or other electronic transmission (i.e., a pdf or tiff) shall be
effective as delivery of a manually executed counterpart hereof. This Commitment Letter (including
the exhibits hereto), together with the Fee Letter dated the date hereof, (i) are the only
agreements that have been entered into among the parties hereto with respect to the Credit
Facilities and (ii) supersede all prior understandings, whether written or oral, among us with
respect to the Credit Facilities and sets forth the entire understanding of the parties hereto with
respect thereto. THIS COMMITMENT LETTER SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH,
THE LAWS OF THE STATE OF NEW YORK.
Each of the parties hereto agrees to negotiate in good faith the Facilities Documentation in a
manner consistent with this Commitment Letter and the Fee Letter.
EACH OF THE PARTIES HERETO IRREVOCABLY WAIVES THE RIGHT TO TRIAL BY JURY IN ANY ACTION,
PROCEEDING, CLAIM OR COUNTERCLAIM BROUGHT BY OR ON BEHALF OF ANY PARTY RELATED TO OR ARISING OUT OF
THIS COMMITMENT LETTER OR THE FEE LETTER OR THE PERFORMANCE OF SERVICES HEREUNDER OR THEREUNDER.
Each of the parties hereto hereby irrevocably and unconditionally (a) submits, for itself and
its property, to the exclusive jurisdiction of any New York State court or Federal court of the
United States of America sitting in New York County, and any appellate court from any thereof, in
any action or proceeding arising out of or relating to this Commitment Letter, the Fee Letter or
- 12 -
the transactions contemplated hereby or thereby, or for recognition or enforcement of any
judgment, and agrees that all claims in respect of any such action or proceeding shall be heard and
determined in such New York State court or, to the extent permitted by law, in such Federal court,
(b) waives, to the fullest extent it may legally and effectively do so, any objection which it may
now or hereafter have to the laying of venue of any suit, action or proceeding arising out of or
relating to this Commitment Letter, the Fee Letter or the transactions contemplated hereby in any
New York State or in any such Federal court, (c) waives, to the fullest extent permitted by law,
the defense of an inconvenient forum to the maintenance of such action or proceeding in any such
court and (d) agrees that a final judgment in any such suit, action or proceeding shall be
conclusive and may be enforced in other jurisdictions by suit on the judgment or in any other
matter provided by law. Each of the parties hereto agrees that service of process, summons, notice
or document by registered mail addressed to you or us at the addresses set forth above shall be
effective service of process for any suit, action or proceeding brought in any such court.
We hereby notify you that pursuant to the requirements of the USA PATRIOT Act (Title III of
Pub. L. 107-56 (signed into law October 26, 2001) (the PATRIOT Act), each of us and each of the
Lenders may be required to obtain, verify and record information that identifies the Borrower and
the Guarantors, which information may include their names, addresses, tax identification numbers
and other information that will allow each of us and the Lenders to identify the Borrower and the
Guarantors in accordance with the PATRIOT Act. This notice is given in accordance with the
requirements of the PATRIOT Act and is effective for each of us and the Lenders.
The indemnification, compensation (if applicable), reimbursement (if applicable),
jurisdiction, governing law, venue, waiver of jury trial, syndication and confidentiality
provisions contained herein and in the Fee Letter and the provisions of paragraph 8 of this
Commitment Letter shall remain in full force and effect regardless of whether Facilities
Documentation shall be executed and delivered and notwithstanding the termination or expiration of
this Commitment Letter or the Initial Lenders commitments hereunder; provided that your
obligations under this Commitment Letter (other than your obligations with respect to (a)
assistance to be provided in connection with the syndication thereof (including supplementing
and/or correcting Information and Projections) prior to the Syndication Date and (b)
confidentiality of the Fee Letter and the contents thereof) shall automatically terminate and be
superseded by the provisions of the Facilities Documentation upon the initial funding thereunder,
and you shall automatically be released from all liability in connection therewith at such time.
You may terminate this Commitment Letter and/or, on a pro rata basis, the Initial Lenders
commitments with respect to the Credit Facilities (or portion thereof pro rata across the Credit
Facilities except to the extent that the commitments to make Bridge Loans are terminated in full)
hereunder at any time subject to the provisions of the preceding sentence.
Section headings used herein are for convenience of reference only and are not to affect the
construction of, or to be taken into consideration in interpreting, this Commitment Letter.
If the foregoing correctly sets forth our agreement, please indicate your acceptance of the
terms of this Commitment Letter and of the Fee Letter by returning to us, executed counterparts
hereof and of the Fee Letter not later than 5:00 p.m., New York City time, on September 14, 2010.
The Initial Lenders respective commitments hereunder will expire at such
- 13 -
time in the event that we have not received such executed counterparts in accordance with the
immediately preceding sentence. If you do so execute and deliver to us this Commitment Letter and
the Fee Letter, we agree to hold our commitment available for you until the earliest of (i) after
execution of the Purchase Agreement and prior to the consummation of the Transactions, the
termination of the Purchase Agreement in accordance with its terms, (ii) the consummation of the
Acquisition with or without the funding of the Credit Facilities and (iii) 5:00 p.m., New York City
time, on January 14, 2011; provided, that such date shall be extended to February 11, 2011 or April
20, 2011 in the event the Termination Date (as defined in the Purchase Agreement) is extended to
either such date pursuant to the first proviso to Section 8.1(d) of the Purchase Agreement (such
earliest time, the Expiration Date). Upon the occurrence of any of the events referred to in the
preceding sentence, this Commitment Letter and the commitments of each of the Commitment Parties
hereunder shall automatically terminate unless the Commitment Parties shall, in their discretion,
agree to an extension in writing.
[Remainder of this page intentionally left blank]
- 14 -
We are pleased to have been given the opportunity to assist you in connection with the
financing for the Transactions.
Very truly yours, BARCLAYS BANK PLC |
||||
By | /s/ John Skrobe | |||
Name: | Johm Skrobe | |||
Title: | Managing Director | |||
JPMORGAN CHASE BANK, N.A. |
||||
By | /s/ Dawn L. LeeLum | |||
Name: | Dawn L. LeeLum | |||
Title: | Executive Director | |||
J.P. MORGAN SECURITIES LLC |
||||
By | /s/ Stas Byhovsky | |||
Name: | Stas Byhovsky | |||
Title: | Executive Director | |||
[SIGNATURE PAGE TO COMMITMENT LETTER]
Accepted and agreed to as of the date first above written: MEDASSETS, INC |
||||
By | /s/ Neil Hunn | |||
Name: | Neil Hunn | |||
Title: | Executive Vice President and CFO | |||
-
EXHIBIT A
Project Barracuda
Transaction Description
Transaction Description
Capitalized terms used but not defined in this Exhibit A shall have the meanings set forth in
the other Exhibits to the Commitment Letter to which this Exhibit A is attached (the Commitment
Letter) or in the Commitment Letter. In the case of any such capitalized term that is subject to
multiple and differing definitions, the appropriate meaning thereof in this Exhibit A shall be
determined by reference to the context in which it is used.
MedAssets intends to acquire (the Acquisition), directly or indirectly, all of the capital
stock of Broadlane Intermediate Holdings, Inc. (the Company) pursuant to the Purchase Agreement
(as defined below).
In connection with the foregoing, it is intended that:
a) | Pursuant to a stock purchase agreement (together with all exhibits, schedules and disclosure letters thereto, collectively, the Purchase Agreement) to be entered into with the Company and Broadlane Holdings, LLC (the Seller), MedAssets will acquire 100% of the outstanding capital stock of the Company. Pursuant to the Acquisition, the Seller shall have the right to receive the consideration for its equity interests in the Company (the Acquisition Consideration) in accordance with the terms of, and subject to adjustment as provided in, the Purchase Agreement. |
b) | MedAssets will obtain up to $750 million in senior secured first-lien loan facilities described in Exhibit B to the Commitment Letter (the Senior Secured Facilities). |
c) | MedAssets will (i) issue and sell senior unsecured notes (the Notes) in a Rule 144A or other private placement on or prior to the Closing Date yielding up to $360 million in gross cash proceeds and/or (ii) if and to the extent that less than $360 million in Notes are issued on or prior to the Closing Date, up to $360 million of senior unsecured increasing rate loans (the Bridge Loans) under a senior unsecured credit facility described in Exhibit C to the Commitment Letter (the Bridge Facility and, together with the Senior Secured Facilities, the Credit Facilities) such that the aggregate face amount of outstanding Notes and the principal amount of the Bridge Loans does not exceed $360 million. |
d) | All the existing third party indebtedness for borrowed money of MedAssets and the Company and their respective subsidiaries (which shall exclude existing capital leases and letters of credit and certain other indebtedness in an aggregate amount not to exceed $3 million that the Initial Lenders and MedAssets reasonably agree may remain outstanding after the Closing Date) will be refinanced or repaid, all commitments thereunder shall be terminated and all security interests therefor shall be released (the Refinancing). |
e) | The proceeds of the Credit Facilities and/or the Notes and cash on hand at MedAssets and the Company on the Closing Date will be applied (i) to pay the Acquisition |
A-2
Consideration, (ii) to pay the fees and expenses incurred in connection with the Transactions and (iii) to pay for the Refinancing (the amounts set forth in clauses (i) through (iii) above, collectively, the Acquisition Costs). |
f) | MedAssets will have a deferred payment obligation to the Seller pursuant to the Purchase Agreement (the Deferred Payment Obligation) in an initial principal amount (if paid by the second business day following January 1, 2012 (the Deferred Payment Date)) of up to $125.0 million (subject to reduction as provided in the Purchase Agreement) (the Deferred Payment Amount). In the event the Deferred Payment Amount due is not paid on or prior to the Deferred Payment Date, and the Seller does not elect to exchange its rights to the Deferred Payment Obligation for common equity of MedAssets in accordance with the Purchase Agreement, the Deferred Payment Amount shall automatically be converted to a subordinated note (the Deferred Payment Subordinated Note) which Deferred Payment Subordinated Note shall (i) not mature earlier than 8 years and 6 months after the Closing Date, (ii) contain no financial maintenance covenants and contain negative covenants that are not more restrictive than those set forth in the Notes or the Exchange Notes (as defined in Exhibit C), as applicable, and otherwise contain terms and conditions, including, without limitation, covenants and transferability provisions, substantially identical to the Notes or the Exchange Notes, as applicable, and which shall be guaranteed by the Guarantors (as defined in Exhibit B) subject to equivalent subordination provisions to those set forth below, (iii) provide for no amortization or mandatory prepayments except to the extent such payments are permitted by the Senior Secured Facilities (as contemplated by Exhibit B) and the Bridge Facility, the Notes or Exchange Notes, as applicable, (iv) provide for no required cash interest payments in excess of 13% per annum (the Deferred Payment Cash Cap) of the principal amount thereof, (v) provide for total interest payments not to exceed 18% per annum (the Total Deferred Payment Cap) with MedAssets having the right to pay any amount of interest in excess of the Deferred Payment Cash Cap through an increase in the principal amount of the Deferred Payment Subordinated Note and (vi) provide for the subordination of all amounts owing (including principal, interest and other amounts) to all Senior Indebtedness (which shall be defined in a customary manner and, in any event, shall include the Senior Secured Facilities, the Bridge Loans, the Exchange Notes and the Notes) and Designated Senior Indebtedness (which shall be defined in a customary manner and include all obligations under the Senior Secured Facilities) on terms customary for recent 144A offerings of senior subordinated notes placed by the Arrangers; provided that such subordination terms shall not prevent the payment of any interest of up to the Total Deferred Payment Cap in excess of the Deferred Payment Cash Cap solely through the increase in the principal amount of the Deferred Payment Subordinated Note or the exercise of rights of set-off, indemnification or purchase price adjustment provided for in the Purchase Agreement. |
The transactions described above (including the payment of Acquisition Costs) are collectively
referred to herein as the Transactions.
EXHIBIT B
Project Barracuda
Senior Secured Credit Facilities
Summary of Principal Terms and Conditions1
Senior Secured Credit Facilities
Summary of Principal Terms and Conditions1
Borrower:
|
MedAssets, Inc., a Delaware corporation (MedAssets). | |
Transaction:
|
As set forth in Exhibit A to the Commitment Letter. | |
Administrative Agent and
Collateral Agent:
|
Barclays Bank will act as sole administrative agent and collateral agent (in such capacities, the Administrative Agent) for a syndicate of banks, financial institutions and other entities (excluding any Disqualified Lender) (together with the Initial Senior Lenders, the Lenders), and will perform the duties customarily associated with such roles. | |
Joint Lead Arrangers:
|
Barclays Capital and J.P. Morgan will act as joint lead arrangers (the Lead Arrangers) for the Senior Secured Facilities and each will perform the duties customarily associated with such roles. | |
Senior Secured Facilities:
|
(A) A senior secured first-lien term A loan facility
(the Term A Facility) in an aggregate principal
amount of $150.0 million (the loans thereunder, the
Term A Loans); provided that in the event the
Borrowers corporate credit ratings are less than
Ba3(stable) from Moodys and BB-(stable) from S&P on
the Closing Date, the Term A Loans will be eliminated
and the amount of the Term B Facility (as defined
below) will be increased by $150.0 million. |
|
(B) A senior secured first-lien term B loan facility
(the Term B Facility and together with the Term A
Facility, the Term Facilities) in an aggregate
principal amount of $450.0 million, subject to
increase as provided above (the loans thereunder, the
Term B Loans and together with the Term A Loans,
the Term Loans). |
1 | All capitalized terms used but not defined herein shall have the meaning given them in the Commitment Letter to which this Term Sheet is attached, including Exhibit A thereto. |
B-1
(C) A senior secured first-lien revolving credit
facility (the Revolving Facility and, together with
the Term Facilities, the Senior Secured Facilities)
in an aggregate principal amount of $150.0 million.
Lenders with commitments under the Revolving Facility
are collectively referred to as Revolving Lenders
and the loans thereunder, together with (unless the
context otherwise requires) the swingline borrowings
referred to below, are collectively referred to as
Revolving Loans; and together with the Term Loans,
the Loans. |
||
Swingline Loans:
|
In connection with the Revolving Facility, Barclays Bank (in such capacity, the Swingline Lender) will make available to the Borrower a swingline facility under which the Borrower may make short-term borrowings upon same-day notice (in minimum amounts to be mutually agreed upon and integral multiples to be agreed upon) of up to $25 million. Except for purposes of calculating the commitment fee described below, any such swingline borrowings will reduce availability under the Revolving Facility on a dollar-for-dollar basis. | |
Upon notice from the Swingline Lender, the Revolving Lenders will be unconditionally obligated to purchase participations in any swingline loan pro rata based upon their commitments under the Revolving Facility. | ||
If any Lender becomes a defaulting Lender, then the swingline exposure of such defaulting Lender will automatically be reallocated among the non-defaulting Lenders pro rata in accordance with their commitments under the Revolving Facility up to an amount such that the revolving credit exposure of such non-defaulting Lender does not exceed its commitments. In the event such reallocation does not fully cover the exposure of such defaulting Lender, the Swingline Lender may require the Borrower to repay such uncovered exposure in respect of the swingline loans and will have no obligation to make new swingline loans to the extent such swingline loans would cause the exposure of the non-defaulting Lenders to exceed the commitments of the non-defaulting Lenders if such swingline loan was fully allocated to non-defaulting Lenders. | ||
Incremental Facilities:
|
The Senior Secured Facilities will permit the Borrower to add one or more incremental term loan facilities to the |
B-2
Senior Secured Facilities (each, an Incremental Term Facility) and/or increase commitments under the Revolving Facility (any such increase, an Incremental Revolving Increase) and/or add one or more incremental revolving credit facility tranches (each, an Incremental Revolving Facility; the Incremental Term Facilities, the Incremental Revolving Increases and the Incremental Revolving Facilities are collectively referred to as Incremental Facilities) in an aggregate amount of up to $200 million; provided that (i) no existing Lender will be required to participate in any such Incremental Facility without its consent, (ii) no event of default under the Senior Secured Facilities would exist after giving effect thereto, (iii) on a pro forma basis after giving effect to the incurrence of any such Incremental Facility (and after giving effect to any acquisition consummated simultaneously therewith and all other appropriate pro forma adjustment events and assuming any Incremental Revolving Facility was fully drawn), the Borrower (x) is in compliance with the financial maintenance covenants in the Senior Secured Facilities Documentation (as defined below) and (y) has a Secured Leverage Ratio (to be defined) that is not greater than 3.5 to 1.0, in each case, recomputed as of the last day of the most recently ended fiscal quarter of the Borrower for which financial statements are available, (iv) the maturity date of any such Incremental Term Facility shall be no earlier than the maturity date of the Term B Facility and the weighted average life of such Incremental Term Facility shall be not shorter than the then remaining weighted average life of the Term B Facility and no portion of any Incremental Revolving Facility shall mature prior to the Revolving Facility, (v) in the case of an Incremental Revolving Increase, the maturity date of such Incremental Revolving Increase shall be the same as the maturity date of the Revolving Facility, such Incremental Revolving Increase shall require no scheduled amortization or mandatory commitment reduction prior to the final maturity of the Revolving Facility and the Incremental Revolving Increase shall be on the exact same terms and pursuant to the exact same documentation applicable to the Revolving Facility, (vi) the interest rate margins and (subject to clause (iv)) amortization schedule applicable to any Incremental Facility shall be determined by the Borrower and the lenders thereunder; provided that to the extent (a) the yield (to be defined to include all upfront fees and |
B-3
OID) on any Incremental Revolving Facility exceeds the yield on the Revolving Facility by more than 50 basis points, then the interest margins for the Revolving Facility, shall be increased to the extent required so that the yield for the Revolving Facility shall be 50 basis points less than the yield for such Incremental Facility and (b) the average annual amortization on any Incremental Term Facility (prior to the final year of maturity of such Incremental Term Facility) (i) is less than 5% per annum and the yield (to be defined to include all upfront fees and OID) on such Incremental Term Facility exceeds the yield on the Term B Facility by more than 50 basis points, then the interest margins for the Term B Facility shall be increased to the extent required so that the yield for the Term B Facility shall be 50 basis points less than the yield for such Incremental Facility and (ii) is 5% or more per annum and the yield (to be defined to include all upfront fees and OID) on such Incremental Term Facility exceeds the yield on the Term A Facility by more than 50 basis points, then the interest margins for the Term A Facility, shall be increased to the extent required so that the yield for the Term A Facility shall be 50 basis points less than the yield for such Incremental Facility, and (vii) any Incremental Facility shall be on terms and pursuant to documentation to be determined; provided that, to the extent such terms and documentation are not consistent with the Term Facilities (except to the extent permitted by clause (iv), (v) and (vi) above), they shall be reasonably satisfactory to the Administrative Agent. | ||
The Borrower may seek commitments in respect of the Incremental Facilities from existing Lenders (each of which shall be entitled to agree or decline to participate in its sole discretion) and additional banks, financial institutions and other institutional lenders or investors who will become Lenders in connection therewith (Additional Lenders); provided that the Administrative Agent, the Swingline Lender and the Issuing Bank (as defined below) shall have consent rights (not to be unreasonably withheld) with respect to such Additional Lender, if such consent would be required under the heading Assignments and Participations for an assignment of loans or commitments, as applicable, to such Additional Lender). | ||
Refinancing Facilities:
|
The Senior Secured Facilities Documentation will permit the Borrower to refinance loans under the Term Facilities |
B-4
or commitments under the Revolving Facility from time to time, in whole or part, with one or more new term facilities (each, a Refinancing Term Facility) or new revolving credit facility (each, a Refinancing Revolving Facility; the Refinancing Term Facilities and the Refinancing Revolving Facilities are collectively referred to as Refinancing Facilities), respectively, under the Facilities Documentation with the consent of the Borrower, the Administrative Agent (and in the case of any Refinancing Revolving Facility, the Swingline Lender and the Issuing Lender) and the institutions providing such Refinancing Term Facility or Refinancing Revolving Facility or with one or more additional series of senior unsecured notes or senior secured notes that will be secured by the Collateral on a pari passu basis with the Senior Secured Facilities or second lien secured notes that will be secured on a silent subordinated basis to the Senior Secured Facilities and to the obligations under any senior secured notes, which will be subject to customary intercreditor arrangements (any such notes, Refinancing Notes); provided that (i) any Refinancing Term Facility or Refinancing Notes do not mature prior to the maturity date of, or have a shorter weighted average life than, loans under the Term B Facility being refinanced, (ii) any Refinancing Revolving Facility does not mature prior to the maturity date of the revolving commitments being refinanced and (iii) the other terms and conditions of such Refinancing Term Facility, Refinancing Revolving Facility or Refinancing Notes (excluding pricing and optional prepayment or redemption terms) are substantially identical to, or less favorable to the investors providing such Refinancing Term Facility, Refinancing Revolving Facility or Refinancing Notes, as applicable, than, those applicable to the Term Facilities or Revolving Facility being refinanced (except for covenants or other provisions applicable only to periods after the latest final maturity date of the Term B Facility and revolving credit commitments existing at the time of such refinancing). | ||
Purpose:
|
(A) The proceeds of borrowings under the Term
Facilities will be used by the Borrower on the
Closing Date, together with the proceeds from the
issuance of the Notes and/or incurrence of the Bridge
Loans, the proceeds from borrowings under the
Revolving Facility and cash on hand at the Company,
solely to pay the Acquisition Costs. |
B-5
(B) The letters of credit and proceeds of Revolving
Loans (except as set forth below) will be used by the
Borrower and its subsidiaries for working capital and
other general corporate purposes, including the
financing of permitted acquisitions, and to finance a
portion of the Acquisition Costs (including to make
payments in respect of the Deferred Payment
Obligation and/or the Deferred Payment Subordinated
Note to the extent contemplated below). |
||
Availability:
|
(A) The Term Facilities will be available in a single
drawing on the Closing Date. Amounts borrowed under
the Term Facilities that are repaid or prepaid may
not be reborrowed. |
|
(B) The Revolving Facility (exclusive of letter of
credit usage) will be made available on the Closing
Date to finance a portion of the Acquisition Costs,
which portion shall be limited on the Closing Date to
an amount sufficient to fund any OID or upfront fees
required to be funded on the Closing Date pursuant to
the flex provisions of the Fee Letter.
Additionally, letters of credit in an amount to be
mutually agreed upon may be issued on the Closing
Date in order to, among other things, backstop or
replace letters of credit outstanding on the Closing
Date under facilities no longer available to
MedAssets or the Company or their respective
subsidiaries as of the Closing Date. Otherwise,
letters of credit and Revolving Loans will be
available after the Closing Date at any time prior to
the final maturity of the Revolving Facility, in
minimum principal amounts to be mutually agreed upon.
Amounts repaid under the Revolving Facility may be
reborrowed. Notwithstanding anything to the contrary
in this Exhibit B, in no event shall any extension of
credit be made under the Revolving Facility prior to
the second business day following January 1, 2012 if,
after giving effect thereto and to the application of
proceeds therefrom, the amount of the undrawn
commitments under the Revolving Facility plus
unrestricted cash of the Borrower and its restricted
subsidiaries would be less than the maximum potential
amount of the Deferred Payment Obligation at such
time (the Minimum Liquidity Condition). |
B-6
Interest Rates and Fees:
|
As set forth on Annex I to the Fee Letter. | |
Default Rate:
|
With respect to overdue principal, the applicable interest rate plus, 2.00% per annum, and with respect to any other overdue amount (including overdue interest), the interest rate applicable to ABR loans (as defined in Annex I) plus 2.00% per annum and in each case, shall be payable on demand. | |
Letters of Credit:
|
Up to $25 million of the Revolving Facility will be available to the Borrower for the purpose of issuing letters of credit. Letters of credit under the Revolving Facility will be issued by Barclays Bank and/or other Lenders (or designated affiliates of Barclays Bank or such other Lenders) reasonably acceptable to the Borrower and the Administrative Agent (each an Issuing Bank). Each letter of credit shall expire not later than the earlier of (a) 12 months after its date of issuance and (b) the fifth business day prior to the final maturity of the Revolving Facility; provided that any letter of credit may provide for renewal thereof for additional periods of up to 12 months (which in no event shall extend beyond the date referred to in clause (b) above). The face amount of any outstanding letter of credit (and, without duplication, any unpaid drawing in respect thereof) will reduce availability under the Revolving Facility on a dollar-for dollar basis. | |
Drawings under any letter of credit shall be reimbursed by the Borrower (whether with its own funds or with the proceeds of loans under the Revolving Facility) within one business day after notice of such drawing is received by the Borrower from the relevant Issuing Bank. The Revolving Lenders will be irrevocably and unconditionally obligated to acquire participations in each letter of credit, pro rata in accordance with their commitments under the Revolving Facility, and to fund such participations in the event the Borrower does not reimburse an Issuing Bank for drawings within the time period specified above. | ||
If any Lender becomes a defaulting Lender, then the letter of credit exposure of such defaulting Lender will automatically be reallocated among the non-defaulting Lenders pro rata in accordance with their commitments under the Revolving Facility up to an amount such that the |
B-7
revolving credit exposure of such non-defaulting Lender does not exceed its commitments. In the event that such reallocation does not fully cover the exposure of such defaulting Lender, the applicable Issuing Bank may require the Borrower to cash collateralize such uncovered exposure in respect of each outstanding letter of credit and will have no obligation to issue new letters of credit, or to extend, renew or amend existing letters of credit to the extent necessary that the exposure of the non-defaulting Lenders does not exceed the revolving commitments of the non-defaulting Lenders (if such participations were fully allocated to the non-defaulting Lenders), unless such uncovered exposure is cash collateralized to the Issuing Banks reasonable satisfaction. | ||
Final Maturity
and Amortization:
|
(A) Term A Facility. | |
The Term A Loans will mature on the date that is five years after the Closing Date and will amortize in quarter installments prior to such time resulting in aggregate annual amortization (expressed as a percentage of the original principal amount of Term A Loans borrowed) as set forth below: | ||
Year 1: 2.5% | ||
Year 2: 15.0% | ||
Year 3: 20.0% | ||
Year 4: 20.0% | ||
Year 5: 42.5% | ||
; provided that the Senior Secured Facilities Documentation shall provide the right for individual Lenders to agree to extend the maturity date of the outstanding Term A Loans upon the request of the Borrower and without the consent of any other Lender on terms to be agreed. | ||
(B) Term B Facility. | ||
The Term B Loans will mature on the date that is six years after the Closing Date and will amortize in equal quarterly installments in aggregate annual amounts equal to 1% of the original principal amount of the Term B Facility, with the balance payable on the sixth anniversary of the Closing Date; provided that the Senior Secured Facilities Documentation shall provide the right for individual Lenders to agree to extend the maturity date of the |
B-8
outstanding Term B Loans upon the request of the Borrower and without the consent of any other Lender on terms to be agreed. | ||
(C) Revolving Facility |
||
The Revolving Facility will mature, and lending commitments thereunder will terminate, on the date that is five years after the Closing Date; provided that the Senior Secured Facilities Documentation shall provide the right of individual Lenders to agree to extend the maturity of such Lenders Revolving Commitments (which may include an increase in the interest rate and undrawn fees payable with respect to such extended Revolving Commitments) upon the request of the Borrower and without the consent of any other Lender. | ||
Guarantees:
|
Subject to the Closing Date Conditions Provision, all obligations of the Borrower (the Borrower Obligations) under the Senior Secured Facilities and under any interest rate protection or other swap or hedging arrangements or cash management arrangements entered into with a Lender, the Administrative Agent or any affiliate of a Lender or the Administrative Agent (Hedging/Cash Management Arrangements) will be unconditionally guaranteed jointly and severally on a senior secured first-lien basis (the Guarantees) by each existing and subsequently acquired or organized direct or indirect wholly-owned restricted subsidiary of the Borrower (the Guarantors), provided that Guarantors shall not include, (a) unrestricted subsidiaries, (b) immaterial subsidiaries (to be defined in a mutually acceptable manner as to individual and aggregate revenues or assets excluded), (c) any subsidiary that is prohibited by applicable law, rule or regulation from guaranteeing the Senior Secured Facilities or which would require governmental (including regulatory) consent, approval, license or authorization to provide a Guarantee unless such consent, approval, license or authorization has been received or which would result in adverse tax consequence to the Borrower or one of its subsidiaries as a result of the operation of Section 956 of the IRS Code and (d) not-for-profit subsidiaries, if any. | |
Notwithstanding the foregoing, subsidiaries may be excluded from the guarantee requirements in circumstances where the Borrower and the Administrative |
B-9
Agent reasonably agree that the cost of providing such a guarantee is excessive in relation to the value afforded thereby. | ||
Security:
|
Subject to the limitations set forth below in this section and subject to the Closing Date Conditions Provision, the Borrower Obligations, the Guarantees and the Hedging/Cash Management Arrangements will be secured by: (a) a perfected pledge of the equity securities of each direct wholly-owned restricted subsidiary of the Borrower and of each subsidiary Guarantor (limited in the case of foreign subsidiaries to 65% of the equity securities of such subsidiaries) and (b) perfected, security interests in, and mortgages on, substantially all tangible and intangible personal property and material fee-owned real property of the Borrower and each subsidiary Guarantor (including but not limited to accounts receivable, inventory, equipment, general intangibles (including contract rights), investment property, intellectual property, material fee-owned real property, material intercompany notes and proceeds of the foregoing) (the items described in clauses (a) and (b) above, but excluding the Excluded Assets (as defined below), collectively, the Collateral). | |
Notwithstanding anything to the contrary, the Collateral shall exclude the following: (i) any fee-owned real property with a fair market value of less than an amount to be agreed and all leasehold interests (including requirements to deliver landlord lien waivers, estoppels and collateral access letters), (ii) motor vehicles and other assets subject to certificates of title, letter of credit rights (except to the extent perfection can be obtained by filing of uniform commercial code financing statements) and commercial tort claims with a value of less than an amount to be agreed, (iii) pledges and security interests prohibited by applicable law, rule or regulation; (iv) equity interests in any person other than wholly owned restricted subsidiaries to the extent not permitted by the terms of such subsidiarys organizational or joint venture documents; (v) assets to the extent a security interest in such assets would result in adverse tax consequences (including as a result of the operation of Section 956 of the IRS Code) (it being understood that the Lenders shall not require the Borrower or any of its subsidiaries to enter into any security agreements or pledge agreements governed under foreign law); (vi) any lease, license or other agreement or any property subject to a purchase |
B-10
money security interest or similar arrangement to the extent that a grant of a security interest therein would violate or invalidate such lease, license or agreement or purchase money arrangement or create a right of termination in favor of any other party thereto (other than the Borrower or a Guarantor) after giving effect to the applicable anti-assignment provisions of the Uniform Commercial Code, other than proceeds and receivables thereof, the assignment of which is expressly deemed effective under the Uniform Commercial Code notwithstanding such prohibition and (vii) those assets as to which the Administrative Agent and the Borrower reasonably agree that the cost of obtaining such a security interest or perfection thereof are excessive in relation to the benefit to the Lenders of the security to be afforded thereby (the foregoing described in clauses (i), (ii), (iii), (iv), (v), (vi) and (vii) are, collectively, the Excluded Assets). In addition, in no event shall control agreements or control or similar arrangements be required with respect to deposit or securities accounts. | ||
All the above-described pledges, security interests and mortgages shall be created on terms to be set forth in the Senior Secured Facilities Documentation; and none of the Collateral shall be subject to other pledges, security interests or mortgages (except permitted liens) and other, exceptions and baskets to be set forth in the Senior Secured Facilities Documentation. | ||
Mandatory Prepayments:
|
Loans under the Term Facilities shall be prepaid with: | |
(A) commencing with the first full fiscal year of the
Borrower to occur after the Closing Date, 50% of
Excess Cash Flow (to be defined in a manner
reasonably acceptable to you and the Initial Senior
Lenders but to include a deduction for permitted
payments of the Deferred Payment Obligation from
internally generated cash flow prior to the second
business day after January 1, 2012), with step-downs
to 25% upon achievement of a ratio of Consolidated
Total Debt to Consolidated EBITDA (the, Total
Leverage Ratio) equal or less than a level to be
agreed upon and to 0% upon achievement of a Total
Leverage Ratio equal or less than a level to be
agreed upon; provided that, in any fiscal year, any
voluntary prepayments of loans under the
Term Facilities and loans under the |
B-11
Revolving Facility to
the extent commitments thereunder are permanently
reduced by the amount of such prepayments, other than
prepayments funded with the proceeds of incurrences
of indebtedness, shall be credited against excess
cash flow prepayment obligations on a
dollar-for-dollar basis for such fiscal year; |
||
(B) 100% of the net cash proceeds of all non-ordinary
course asset sales or other dispositions of property
by the Borrower and its restricted subsidiaries
(including (x) insurance and condemnation proceeds
and sale leaseback proceeds and (y) to the extent not
actually applied to repay amounts outstanding under
the Bridge Facility, the net cash proceeds received
after the Closing Date from any disposition of assets
required to be undertaken pursuant to Section 6.4 of
the Purchase Agreement (a Required Divestiture))
subject, except in the case of proceeds of a Required
Divestiture, to the right of the Borrower to reinvest
100% of such proceeds within 12 months and, if so
committed to be reinvested, so long as such
reinvestment is actually completed within 180 days
thereafter, and other exceptions to be set forth in
the Senior Secured Facilities Documentation; and |
||
(C) 100% of the net cash proceeds of issuances of
debt obligations of the Borrower and its restricted
subsidiaries after the Closing Date (other than debt
permitted under the Senior Secured Facilities
Documentation). |
||
Mandatory prepayments shall be applied, without premium or penalty, subject to reimbursement of the Lenders redeployment costs in the case of a prepayment of Adjusted LIBOR borrowings other than on the last day of the relevant interest period, on a pro rata basis to the Term A Facility and the Term B Facility and to the scheduled installments of principal under each such facility in direct order of maturity. | ||
Any Lender may elect not to accept its pro rata portion of any mandatory prepayment (each a Declining Lender). Any prepayment amount declined by a Declining Lender, may be retained by the Borrower. |
B-12
The loans under the Revolving Facility shall be prepaid and the letters of credit cash collateralized to the extent such extensions of credit exceed the amount of the commitments under the Revolving Facility. | ||
Voluntary Prepayments and
Reductions in Commitments:
|
Voluntary reductions of the unutilized portion of the Revolving Facility commitments and voluntary prepayments of borrowings under the Senior Secured Facilities will be permitted at any time, in minimum principal amounts to be mutually agreed upon, without premium or penalty, subject to reimbursement of the Lenders redeployment costs in the case of a prepayment of Adjusted LIBOR borrowings other than on the last day of the relevant interest period. Notwithstanding the foregoing, in no event shall any optional reduction in the amount of commitments under the Revolving Facility be permitted prior to the second business day following January 1, 2012 unless after giving effect thereto the Minimum Liquidity Condition would be satisfied. | |
All voluntary prepayments of the Term A Facility, Term B Facility and any Incremental Term Facility will be applied to the remaining amortization payments under such facility, in any case, as directed by the Borrower (and absent such direction, in direct order of maturity thereof); provided that the Term B Facility may not be prepaid on a greater amount than pro rata basis with the Term A Facility. | ||
Call Premium:
|
In the event all or any portion of the Term B Facility is repaid, repriced or effectively refinanced through any amendment of the Term B Facility which results in reduction in the weighted average yield prior to the first anniversary of the Closing Date (other than in connection with a refinancing in full of the Senior Secured Facilities in connection with a change of control), such repayments (or repricings or effective refinancings) will be made at (i) 101.0% of the principal amount repaid (or repriced or effectively refinanced) if such repayment (or repricing or effective refinancing) occurs on or prior to the first anniversary of the Closing Date and (ii) at par thereafter. | |
Documentation:
|
The definitive documentation for the Senior Secured Facilities (the Senior Secured Facilities Documentation) will contain only those conditions to borrowing, representations, warranties, covenants and |
B-13
events of default expressly set forth in this Term Sheet, together with other customary loan document provisions and other terms and provisions to be mutually agreed upon (it being understood and agreed that only the terms expressly set forth herein are being committed to), the definitive terms of which will be negotiated in good faith (including as to operational requirements of the Borrower and its subsidiaries in light of their industries, businesses and business practices and current market conditions), and shall be consistent with this Term Sheet. | ||
Representations and Warranties:
|
Limited to the following (to be applicable to the Borrower and its restricted subsidiaries only): | |
organizational status and good standing; power and authority, execution, delivery and enforceability of Senior Secured Facilities Documentation; with respect to Senior Secured Facilities Documentation, no violation of, or conflict with, law, organizational documents or agreements; compliance with law; litigation; margin regulations; material governmental approvals with respect to the Senior Secured Facilities; Investment Company Act; accurate and complete disclosure; accuracy of historical financial statements (including pro forma financial statements based on historical balance sheets), no material adverse change; taxes; ERISA; subsidiaries; intellectual property; insurance; environmental laws; use of proceeds; ownership of properties; creation, perfection and priority of liens and other security interests; consolidated Closing Date solvency of the Borrower and its subsidiaries; and status of the Senior Secured Facilities as senior debt and designated senior debt, subject, in the case of each of the foregoing representations and warranties, to customary qualifications and limitations for materiality to be provided in the Senior Secured Facilities Documentation. | ||
Conditions to Initial Borrowing:
|
The availability of the initial borrowing and other extensions of credit under the Senior Secured Facilities on the Closing Date will be subject solely to the applicable conditions set forth in Section 6 of the Commitment Letter, the Conditions to All Borrowings section below and in Exhibit D to the Commitment Letter. | |
Conditions to All Borrowings:
|
The making of each extension of credit under the Senior Secured Facilities shall be conditioned upon (a) delivery of a customary borrowing notice, (b) the accuracy of representations and warranties in all material respects (subject, on the Closing Date, to the Closing Date |
B-14
Conditions Provision) and (c) after the Closing Date, the absence of defaults or events of default at the time of, or after giving effect to the making of, such extension of credit. | ||
Affirmative Covenants:
|
Limited to the following (to be applicable to the Borrower and its restricted subsidiaries only): delivery of annual and quarterly financial statements (accompanied by an unqualified audit opinion in the case of annual financial statements), annual budget reports (with delivery time periods to be consistent with the delivery requirements for the audited financial statements), accountants letters, officers certificates and other information reasonably requested by the Administrative Agent; notices of defaults, litigation and ERISA events; inspections (subject to frequency (so long as there is no ongoing event of default) and cost reimbursement limitations); maintenance of property (subject to casualty, condemnation and normal wear and tear) and customary insurance; maintenance of existence and corporate franchises; rights and privileges; maintenance and inspection of books and records; payment of taxes and similar claims; compliance with laws and regulations (including ERISA, environmental and PATRIOT Act); additional Guarantors and Collateral (subject to limitations set forth above in Security); use of proceeds; changes in lines of business; commercially reasonable efforts to maintain public corporate credit/family ratings of Borrower and ratings of the Senior Secured Facilities from Moodys and S&P (but not to maintain a specific rating); obtaining interest rate protection with respect to the Term Facilities on terms reasonably satisfactory to the Administrative Agent to the extent necessary to ensure that at least 50% of the Borrowers consolidated indebtedness effectively bears interest at a fixed rate for a period of three years from the Closing Date; and further assurances on collateral matters, subject, in the case of each of the foregoing covenants, to exceptions and qualifications to be provided in the Senior Secured Facilities Documentation. | |
Negative Covenants:
|
Limited to the following (to be applicable to the Borrower and its restricted subsidiaries) limitations on: | |
a) the incurrence of debt (which shall
permit, among other things, the
incurrence and/or existence of
indebtedness under (i) the Senior Secured
Facilities (including Incremental
Facilities), (ii) |
B-15
non-speculative hedging
arrangements entered into in the ordinary
course of business, (iii) the Notes
and/or the Bridge Facility, (iv) certain
indebtedness existing on the Closing Date
(including the Deferred Payment
Obligation and the Deferred Payment
Subordinated Note), (v) secured or
unsecured notes to be issued in lieu of
the Incremental Facilities so long as the
Borrower is in pro forma compliance with
the financial maintenance covenants after
giving pro forma effect to the issuance
of such notes and has a Secured Leverage
Ratio of less than 3.5 to 1.0
and (v) Refinancing Facilities
and/or Refinancing Notes); |
||
b) liens; |
||
c) fundamental changes; |
||
d) asset sales (including sales of
subsidiaries) and sale leasebacks (which,
in each case, shall be permitted on the
terms set forth in the second succeeding
paragraph); |
||
e) investments (which shall permit, among
other things, intercompany investments,
re-organizations and other activities
related to tax planning and
re-organization, subject to limitations
to be agreed), and acquisitions (which
shall be permitted on the terms set forth
in the third succeeding paragraph); |
||
f) dividends or distributions on, or
redemptions of, the Borrowers equity; |
||
g) (A) prepayments or redemptions of
unsecured or subordinated debt
(including, without limitation, (x) the
Deferred Payment Obligation (including
any payment at maturity) and payments of
cash interest on the Deferred Payment
Subordinated Note at a rate in excess of
the Deferred Payment Cash Cap, subject to
an exception permitting repayment at any
time on or prior to the second business
day after January 1, 2012 so long as no
default or event of default has occurred
and is continuing and subject to pro
forma compliance with the financial
covenants and minimum liquidity (to be
defined to include unrestricted cash and
unused commitments under the |
B-16
Revolving
Facility) of at least $40.0 million
(Liquidity Condition) and (y) the
Deferred Payment Subordinated Note
subject to exceptions permitting
repayment at any time so long as no
default or event of default has occurred
and is continuing (i) using the Available
Amount Basket (as defined below and
subject to the conditions set forth
below), (ii) from the proceeds of any
other indebtedness (other (x) than
intercompany indebtedness and (y) unless
the Liquidity Condition would be
satisfied, borrowings under the Revolving
Facility) so long as on a pro forma basis
the Total Leverage Ratio is less than 4.5
to 1.0 and (iii) from the proceeds of
subordinated indebtedness constituting
Permitted Refinancing Indebtedness (to be
defined in a customary manner)); provided
that in the case of clauses (x) and (y)
above, partial repayments shall be
permitted up to the amount that would
satisfy the conditions set forth in such
clauses and provided, further, that this
covenant shall not prohibit the payment
of interest in respect of the Deferred
Payment Subordinated Note up to the Total
Deferred Payment Cap through an increase
in the Deferred Payment Subordinated Note
or the right of the holder thereof to
exchange its right under the Deferred
Payment Obligation or Deferred Payment
Subordinated Note for common equity of
MedAssets in accordance with the Purchase
Agreement and the Deferred Payment
Subordinated Note; provided that nothing
in this clause (A) shall prohibit the
exercise of rights of set-off,
indemnification or purchase price
adjustments pursuant to the Purchase
Agreement and (B) amendments of unsecured
or subordinated debt documents, the
Purchase Agreement (including the
provisions relating to the Deferred
Payment Obligation) or organization
documents, in each case, in a manner
material and adverse to the Lenders; |
||
h) negative pledge clauses; |
||
i) transactions with affiliates; and |
||
j) changes in fiscal year. |
||
The negative covenants will be subject, in the case of each of the foregoing covenants to exceptions, qualifications and baskets to be set forth in the Senior Secured |
B-17
Facilities Documentation (including an available basket amount (the Available Amount Basket) that will also be built by retained Excess Cash Flow and new equity (which shall be common equity or other qualified equity on terms to be mutually agreed and excluding Specified Equity Contributions) that may be used, subject to the absence of any continuing event of default and pro forma compliance with all applicable maintenance covenants and a Total Leverage Ratio on a pro forma basis of not more than 4.5 to 1.0, for, among other things, certain investments, restricted payments and the prepayment or redemption of unsecured or subordinated debt, including the Deferred Payment Subordinated Note). | ||
The Borrower or any restricted subsidiary will be permitted to dispose or sell any of its assets of up to an amount to be agreed for fair market value so long as (a) at least 75% of the consideration for asset sales consists of cash (subject to customary exceptions to the cash consideration requirement to be set forth in the Senior Secured Facilities Documentation, including a basket in an amount to be agreed for non-cash consideration that may be designated as cash consideration) and (b) such asset sale is subject to the terms set forth in the section entitled Mandatory Prepayments hereof. | ||
The Borrower or any restricted subsidiary will be permitted to (1) make acquisitions for consideration not to exceed $200.0 million in the aggregate (provided that such limitation shall not apply to the extent that on a pro forma basis, the Total Leverage Ratio is less than or equal to 4.5 to 1.0) (each, a Permitted Acquisition) so long as (a) there is no event of default after giving pro forma effect to such acquisition and the incurrence of indebtedness in connection therewith, (b) the Borrower would be in compliance, on a pro forma basis after giving effect to the consummation of such acquisition, with the financial maintenance covenants in the Senior Secured Facilities Documentation recomputed as of the last day of the most recently ended fiscal quarter of the Borrower for which financial statements are available, (c) the acquired company or assets are in the same or a generally related line of business as the Borrower and its subsidiaries and (d) subject to the limitations set forth in Guarantees and Security above, the acquired company and its subsidiaries will become Guarantors and pledge their Collateral to the Administrative Agent and (2) incur or |
B-18
assume indebtedness in connection with such Permitted Acquisitions that was not created in contemplation of such Permitted Acquisition so long as the Borrower is in pro forma compliance with the financial maintenance covenants in the Senior Secured Facilities Documentation recomputed as of the last day of the most recently ended fiscal quarter of the Borrower for which financial statements are available and before and after giving effect thereto, no default or event of default has occurred and is continuing (and, in the case of any newly incurred indebtedness, such indebtedness is indebtedness of the Borrower or a Guarantor that matures at least 6 months after the Term Loans and the Total Leverage Ratio is less than 4.5 to 1.0 on a pro forma basis). Acquisitions of entities that do not become Guarantors and made with the proceeds of any consideration provided by the Borrower or a Guarantor will be limited to an aggregate amount to be agreed upon in the Senior Secured Facilities Documentation. | ||
Financial Maintenance Covenants:
|
The Senior Secured Facilities Documentation will contain the following financial covenants with regard to the Borrower and its restricted subsidiaries on a consolidated basis: (a) a maximum Total Leverage Ratio and (b) a minimum ratio of Consolidated EBITDA to Cash Consolidated Interest Expense (to be defined), in each case with levels providing a 25-30% cushion (calculated on a static basis) in Consolidated EBITDA above the Consolidated EBITDA levels set forth in the MedAssets model (the MedAssets Model), which model shall be dated September 13, 2010 and delivered to the Joint Lead Arrangers prior to the date hereof; provided that at no time during the term of the Senior Secured Facilities shall the levels of the Total Leverage Ratio covenant be lower than a ratio to be agreed or the Cash Consolidated Interest Expense covenant be greater than a ratio to be agreed. | |
For purposes of determining compliance with the financial covenants, any cash equity contribution (which shall be common equity or otherwise in a form reasonably acceptable to the Administrative Agent) made to the Borrower after the last day of the relevant fiscal quarter and on or prior to the day that is 10 days after the day on which financial statements are required to be delivered for such fiscal quarter will, at the request of the Borrower, be included in the calculation of Consolidated EBITDA solely for the purposes of determining compliance with |
B-19
the financial maintenance covenants at the end of such fiscal quarter and applicable subsequent periods which include such fiscal quarter (any such equity contribution so included in the calculation of Consolidated EBITDA, a Specified Equity Contribution); provided that (a) in each four fiscal quarter period, there shall be at least two fiscal quarters in respect of which no Specified Equity Contribution is made and no more than four Specified Equity Contributions may be made during the term of the Senior Secured Credit Facilities, (b) the amount of any Specified Equity Contribution shall be no greater than the amount required to cause the Borrower to be in pro forma compliance with the financial maintenance covenants, (c) all Specified Equity Contributions shall be disregarded for purposes of determining any baskets with respect to the covenants contained in the Senior Secured Facilities Documentation and (d) there shall be no pro forma reduction in indebtedness with the proceeds of any Specified Equity Contribution for determining compliance with the financial maintenance covenants for the fiscal quarter in which such Specified Equity Contribution is made. | ||
The financial covenants will be tested with respect to the Borrower and its restricted subsidiaries on a consolidated basis beginning with the last day of the first full fiscal quarter of the Borrower completed after the Closing Date. | ||
Unrestricted Subsidiaries:
|
The Senior Secured Facilities Documentation will contain provisions pursuant to which, subject to limitations on loans, advances, guarantees and other investments in, unrestricted subsidiaries, the Borrower will be permitted to designate any existing or subsequently acquired or organized subsidiary as an unrestricted subsidiary and subsequently re-designate any such unrestricted subsidiary as a restricted subsidiary so long as, after giving effect to any such designation or re-designation, the Borrower shall be in pro forma compliance with the financial maintenance covenants in the Senior Secured Facilities Documentation recomputed as of the last day of the most recently ended fiscal quarter of the Borrower for which financial statements are available and the fair market value of such subsidiary at the time it is designated as an unrestricted subsidiary shall be treated as an investment by the Borrower at such time. No unrestricted subsidiary that is redesignated as a restricted subsidiary may subsequently be designated as an unrestricted subsidiary. |
B-20
Unrestricted subsidiaries will not be subject to the representation and warranties, affirmative or negative covenant or event of default provisions of the Senior Secured Facilities Documentation and the results of operations and indebtedness of unrestricted subsidiaries will not be taken into account for purposes of determining compliance with the financial covenants contained in the Senior Secured Facilities Documentation. When designated as an unrestricted subsidiary, each such unrestricted subsidiary, in the aggregate with all unrestricted subsidiaries previously designated (at the time of designation thereof) that continue to be unrestricted subsidiaries, shall not constitute more than a percentage to be agreed of (x) pro forma EBITDA of the Borrower and it subsidiaries for the four-quarter period ended immediately prior to the date of such designation and (y) the pro forma total assets of the Borrower and its subsidiaries at the time of such designation. | ||
Event of Default:
|
Limited to the following (to be applicable to the Borrower and its restricted subsidiaries only): nonpayment of principal when due; nonpayment of interest or other amounts after a customary five business day grace period; violation of covenants (subject, in the case of certain of such covenants, to a thirty day grace period); incorrectness of representations and warranties in any material respect; cross default and cross acceleration to material indebtedness; bankruptcy or other insolvency events of the Borrower or its material subsidiaries (with a customary grace period for involuntary events); material monetary judgments; ERISA events; actual or asserted invalidity of material guarantees or security documents; and change of control. | |
Voting:
|
Amendments and waivers of the Senior Secured Facilities Documentation will require the approval of Lenders holding more than 50% of the aggregate amount of the loans and commitments under the Senior Secured Facilities (the Required Lenders), except that (i) the consent of each Lender directly and adversely affected thereby shall be required with respect to: (A) increases in the commitment of such Lender, (B) reductions of principal, interest or fees, (C) extensions of scheduled amortization payments or final maturity, (D) provisions relating to pro rata sharing and payments (other than pro rata offers as set forth below) and (E) voting requirements, (ii) the consent of 100% of the Lenders will be required |
B-21
with respect to (A) modifications to any of the voting percentages and (B) releases of all or substantially all Guarantors (or the value of their guarantees) or releases of all or substantially all of the Collateral, and (iii) customary protections for the Administrative Agent, the Swingline Lender and the Issuing Banks will be provided. | ||
For the avoidance of doubt, in connection with below par offers to prepay Loans, the Facilities Documentation may be amended in order to modify any provision relating to pro rata sharing of payments among the Lenders with the consent of Lenders holding more than 50% of the advances and commitments under each of the Term Facilities and the Revolving Facility. In the event that any provision relating to pro rata sharing of payments among the Lenders is modified in favor of any class of Lenders holding loans with a maturity date longer than the maturity date of the Revolving Facility, the Term A Facility or the Term B Facility, a majority vote of the Lenders under the Facilities directly and adversely affected thereby shall be required. | ||
The Senior Secured Facilities Documentation shall contain customary provisions for replacing non-consenting Lenders in connection with amendments and waivers requiring the consent of all Lenders or of all Lenders directly affected thereby so long as Lenders holding more than 50% of the aggregate amount of the loans and commitments under the Senior Secured Facilities shall have consented thereto. | ||
Cost and Yield Protection:
|
The Senior Secured Facilities Documentation will include customary tax gross-up, cost and yield protection provisions. | |
Assignments and Participations:
|
After the Closing Date, the Lenders will be permitted to assign (except to Disqualified Lenders) (a) loans and/or commitments under the Term Facilities with the consent of the Borrower and the Administrative Agent (in each case not to be unreasonably withheld or delayed), and (b) loans and commitments under the Revolving Facility with the consent of the Borrower, the Swingline Lender, the Issuing Banks and the Administrative Agent (in each case not to be unreasonably withheld or delayed); provided that (A) no consent of the Borrower shall be required (i) (x) prior to a Successful Syndication and (y) thereafter, after the occurrence and during the continuance of a payment or |
B-22
bankruptcy Event of Default or (ii) with respect to any Term Loans, if such assignment is an assignment to another Lender, an affiliate of a Lender or an approved fund and (B) no consent of the Administrative Agent shall be required with respect to assignment of any Term Loans, if such assignment is an assignment to another Lender, an affiliate of a Lender or an approved fund. Each assignment (other than to another Lender, an affiliate of a Lender or an approved fund) will be in an amount of an integral multiple of $1,000,000 in the case of the Term Facilities and $5,000,000 in the case of the Revolving Facility (or lesser amounts, if agreed between the Borrower and the Administrative Agent) or, if less, all of such Lenders remaining loans and commitments of the applicable class. Assignments will be by novation and will not be required to be pro rata among the Senior Secured Facilities. The Administrative Agent shall receive a processing and recordation fee of $3,500 for each assignment (it being understood that such recordation fee shall not apply to assignments by the Initial Senior Lenders in connection with the initial syndication of the Senior Secured Facilities). For any assignments for which the Borrowers consent is required, such consent shall be deemed to have been given if the Borrower has not responded within 5 business days of a request for such consent. | ||
The Lenders will be permitted to sell participations in loans and commitments without restriction in accordance with applicable law. Voting rights of participants shall be limited to matters set forth under Voting above with respect to which the unanimous vote of all Lenders (or all directly and adversely affected Lenders, if the participant is directly and adversely affected) would be required. | ||
Assignments to and purchases of Term Loans by affiliates of the Borrower (other than the subsidiaries of the Borrower) (each, an Affiliated Lender) will be permitted without any consent, including through open-market purchases, subject to the following limitations: | ||
(i) Affiliated Lenders will not
receive information provided solely to
Lenders by the Administrative Agent or
any Lender and will not be permitted to
attend/participate in meetings not
attended by the Borrower; |
B-23
(ii) for purposes of any amendment, waiver or modification of the Senior Secured Facilities Documentation or any plan of reorganization that in either case does not require the consent of each Lender or each affected Lender or does not adversely affect such Affiliated Lender in any material respect as compared to other Lenders, Affiliated Lenders will be deemed to have voted in the same proportion as non-affiliated Lenders voting on such matter; | ||
(iii) Affiliated Lenders may not purchase Revolving Loans; | ||
(iv) the amount of Term Loans purchased by Affiliated Lenders may not exceed 20% of the original principal amount of the Term Loans; and | ||
(v) Affiliated Lenders may not purchase Term Loans at any time they have material non public information with respect to the Borrower. | ||
Assignments of Term Loans to the Borrower and its subsidiaries shall be permitted so long as (i) any offer to purchase or take by assignment any Term Loans by the Borrower or any of its subsidiaries shall have been made to all Lenders pro rata (with buyback mechanics to be agreed), (ii) no default or event of default has occurred and is continuing, (iii) the loans purchased are immediately cancelled and (iv) no proceeds from any loan under the Revolving Facility shall be used to fund such assignments. | ||
Expenses and Indemnification:
|
The Borrower shall pay all reasonable and documented or invoiced out-of-pocket costs and expenses of the Administrative Agent and the Commitment Parties (without duplication) associated with the syndication of the Senior Secured Facilities and the preparation, execution and delivery, administration, amendment, modification, waiver and/or enforcement of the Senior Secured Facilities Documentation (including the reasonable fees, disbursements and other charges of counsel identified herein and local counsel in each applicable jurisdiction or otherwise retained with the Borrowers consent (such consent not to be unreasonably withheld or delayed)). |
B-24
The Borrower will indemnify the Administrative Agent, the Commitment Parties, the Lenders and their affiliates, and the officers, directors, employees, advisors, agents, controlling persons and other representatives and their successors and permitted assigns of each of the foregoing, and hold them harmless from and against all losses, claims, damages, liabilities and reasonable and documented or invoiced out-of-pocket fees and expenses (including reasonable fees, disbursements and other charges of one counsel for all indemnified parties and, if necessary, one firm of local counsel in each appropriate jurisdiction (which may include a single special counsel acting in multiple jurisdictions) for all indemnified parties (and, in the case of an actual or perceived conflict of interest, where the indemnified person affected by such conflict informs the Borrower of such conflict and thereafter retains its own counsel, of another firm of counsel for such affected indemnified person)) of any such indemnified person arising out of or relating to the Transactions, including the financings contemplated thereby (including, without limitation, any claim or any litigation or other proceeding (regardless of whether such indemnified person is a party thereto and whether or not such proceedings are brought by the Borrower, its equity holders, its affiliates, creditors or any other third person) that relates to the Transactions, including the financing contemplated hereby); provided that no indemnified person will be indemnified for any loss, claim, damage, liability, cost or expense to the extent it has resulted from (i) the gross negligence or willful misconduct of such person or any of its affiliates or controlling persons or any of the officers, directors, employees, agents, advisors, or members of any of the foregoing (as determined by a court of competent jurisdiction in a final and non-appealable decision) or (ii) a material breach by any such person or one of its affiliates (as determined by a court of competent jurisdiction in a final and non-appealable decision). | ||
Governing Law and Forum:
|
New York. | |
Counsel to the Administrative
Agent and Lead Arrangers:
|
Cahill Gordon & Reindel LLP. |
B-25
EXHIBIT C
Project Barracuda
Senior Unsecured Bridge Facility
Summary of Principal Terms and Conditions2
Senior Unsecured Bridge Facility
Summary of Principal Terms and Conditions2
Borrower:
|
The Borrower under the Senior Secured Facilities. | |
Transaction:
|
As set forth in Exhibit A to the Commitment Letter. | |
Administrative Agent
|
JPMCB will act as sole administrative agent (in such capacity, the Administrative Agent) for a syndicate of banks, financial institutions and other entities excluding Disqualified Lenders (together with the Initial Bridge Lenders, the Lenders), and will perform the duties customarily associated with such role. | |
Joint Lead Arrangers:
|
J.P. Morgan and Barclays Capital will act as joint lead arrangers (the Lead Arrangers) for the Bridge Facility, and each will perform the duties customarily associated with such roles. | |
Initial Bridge Loans:
|
The Lenders will make senior unsecured increasing rate loans (the Initial Bridge Loans) to the Borrower on the Closing Date in an aggregate principal amount of up to $360 million minus the aggregate amount of Notes issued on or prior to the Closing Date. | |
Availability:
|
The Lenders will make the Initial Bridge Loans on the Closing Date simultaneously with (a) the consummation of the Acquisition and (b) the initial funding under the Senior Secured Facilities. | |
Purpose:
|
The proceeds of borrowings of the Initial Bridge Loans will be used by the Borrower on the Closing Date, together with the proceeds of borrowings under the: Senior Secured Facilities, the proceeds of the issuance of the Notes, if any, and cash on hand at the Company, solely to pay the Acquisition Costs. | |
Ranking:
|
The Initial Bridge Loans will rank pari passu with the Senior Secured Facilities and other senior indebtedness of the Borrower. |
2 | All capitalized terms used but not defined herein shall have the meanings given to them in the Commitment Letter to which this term sheet is attached, including Exhibit A thereto. |
Exhibit C-1
Guarantees:
|
The Initial Bridge Loans will be jointly and severally guaranteed by each Guarantor (as defined in Exhibit B to the Commitment Letter) on a senior basis (such guarantees, the Guarantees). The Guarantees will rank pari passu with guarantees of the Senior Secured Facilities. The Guarantees will automatically be released upon the release of the corresponding guarantees of the Senior Secured Facilities with exceptions for repayment, termination or refinancing of the Senior Secured Facilities. | |
Maturity:
|
All Initial Bridge Loans will have an initial maturity date that is the one-year anniversary of the Closing Date (the Initial Bridge Loan Maturity Date), which shall be extended as provided below. If any of the Initial Bridge Loans have not been previously repaid in full on or prior to the Initial Bridge Loan Maturity Date and no payment or bankruptcy (with respect to the Borrower) event of default then exists, such Initial Bridge Loans shall automatically be extended into senior unsecured term loans (each an Extended Term Loan) due on the date that is eight years after the Closing Date (the Extended Maturity Date) having the terms set forth on Annex I hereto. The date on which Initial Bridge Loans are extended as Extended Term Loans is referred to as the Extension Date. At any time or from time to time on or after the Extension Date, at the option of the Lenders, the Extended Term Loans may be exchanged in whole or in part for senior unsecured exchange notes (the Exchange Notes) having an equal principal amount and having the terms set forth in Annex II hereto; provided that the Borrower may defer the first issuance of Exchange Notes until such time as the Borrower shall have received requests to issue an aggregate of at least $50 million in aggregate principal amount of Exchange Notes. | |
In connection with any Lenders exchange of Initial Bridge Loans for Exchange Notes, or at any time prior thereto if reasonably requested by the Initial Bridge Lenders, the Borrower shall use its commercially reasonable efforts to take such actions and deliver such documents as may be deemed reasonably necessary or otherwise advisable to permit such Lender to resell Exchange Notes (which may include customary opinions, accountants comfort letters and other offering documents and agreements); provided that, in no event, shall the Borrower be required to register the Exchange Notes other than pursuant to the terms under the |
Exhibit C-2
heading Registration Rights below. | ||
The Initial Bridge Loans, the Extended Term Loans and the Exchange Notes shall be pari passu for all purposes. | ||
Interest Rates:
|
Prior to the Initial Bridge Loan Maturity Date, the Initial Bridge Loans will accrue interest at the rate provided in Annex II to the Fee Letter. | |
Default Rate:
|
Overdue principal, interest, fees and other amounts shall bear interest at the applicable interest rate plus 2.00% per annum. | |
Mandatory Prepayment:
|
The Borrower will be required to prepay the Initial Bridge Loans on a pro rata basis at 100% of the outstanding principal amount thereof plus accrued and unpaid interest with (i) the net cash proceeds from the issuance of Securities, provided, that in the event any Initial Bridge Lender or affiliate of an Initial Bridge Lender purchases debt securities from the Borrower pursuant to a securities demand under the Fee Letter at an issue price above the level at which such Initial Bridge Lender or affiliate has determined such debt securities can be resold by such Initial Bridge Lender or affiliate to a bona fide third party at the time of such purchase that is not a lender under the Bridge Facility or affiliate thereof or a participant in the Bridge Facility at such time (and notifies the Borrower thereof), the net cash proceeds received by the Borrower in respect of such debt securities may, at the option of such Initial Bridge Lender or affiliate, be applied first to prepay the Initial Bridge Loans of such Initial Bridge Lender or affiliate (provided that if there is more than one such Initial Bridge Lender or affiliate then such net cash proceeds will be applied pro rata to prepay the Initial Bridge Loans of all such Initial Bridge Lenders or affiliates in proportion to such Initial Bridge Lenders or affiliates principal amount of debt securities purchased from the Borrower) prior to being applied to prepay the Initial Bridge Loan held by other Initial Bridge Lenders; (ii) the net proceeds from the issuance of any Refinancing Debt (to be defined) by the Borrower or any of its restricted subsidiaries; (iii) net cash proceeds from any issuance of equity, subject to exceptions to be agreed and (iv) the net cash proceeds from (x) any Required Divestiture received after the Closing Date and (y) any non-ordinary course asset sales or dispositions (including as a result of casualty or condemnation but excluding Required Divestitures) by the Borrower or any of its restricted subsidiaries in excess of amounts either reinvested in the |
Exhibit C-3
business of the Borrower or its restricted subsidiaries in accordance with the Senior Secured Facilities or required to be paid to the lenders under the Senior Secured Facilities, in the case of any such prepayments pursuant to the foregoing clause (iv)(y) above with exceptions and baskets usual and customary for financings of this type. | ||
The Borrower will also be required to offer to prepay the Initial Bridge Loans following the occurrence of a change of control (to be defined in a manner consistent with the Applicable Bond Standard (as defined below) and in any event not less favorable to the Borrower than the definition in the Senior Secured Facilities Documentation)) at 100% of the outstanding principal amount thereof, plus accrued and unpaid interest to the date of repayment. | ||
Optional Prepayment:
|
The Initial Bridge Loans may be prepaid, in whole or in part, at par plus accrued and unpaid interest upon not less than one business days prior written notice, at the option of the Borrower at any time. | |
Documentation:
|
The definitive documentation for the Bridge Facility (the Bridge Facility Documentation) will contain only those conditions to borrowing, representations, warranties, covenants and events of default expressly set forth in this Term Sheet and consistent with the Senior Secured Facilities Documentation with modifications to reflect bridge loan terms and provisions that are usual and customary for facilities of this type, the definitive terms of which will be negotiated in good faith (including as to operational requirements of the Borrower and its subsidiaries in light of their industries, businesses and business practices and current market conditions), and shall be consistent with this Term Sheet and in any event, other than as set forth herein, not less favorable to the Borrower than the provisions of the Senior Secured Facilities. | |
Conditions to All
Borrowings:
|
The availability of the initial borrowing under the Bridge Facility on the Closing Date shall be conditioned solely upon the satisfaction of the applicable conditions set forth in Section 6 of the Commitment Letter and Exhibit D to the Commitment Letter and the accuracy of the representations and warranties in the Bridge Facility Documentation (subject to the Closing Date Conditions Provision). | |
Representations
and Warranties:
|
The Bridge Facility Documentation will contain representations and warranties as are substantially similar to |
Exhibit C-4
those in the Senior Secured Facilities Documentation, with additional representations and warranties usual and customary for high yield financings consistent with the Applicable Bond Standard and to the extent necessary to reflect differences in documentation. | ||
Covenants:
|
The Bridge Facility Documentation will contain such affirmative and negative covenants applicable to the Borrower and its restricted subsidiaries usual and customary for publicly traded high yield securities and based on and consistent with similar offerings in light of market conditions (it being understood and agreed that only the terms expressly set forth herein are being committed to), the definitive terms of which will be negotiated in good faith (including as to operational requirements of the Borrower and its subsidiaries in light of their industries, businesses, and business practice and current market conditions) (the Applicable Bond Standard), will be incurrence-based covenants, and, in no event, except as set forth herein, shall be more restrictive than, or include any covenants not included in the Senior Secured Facilities. The Bridge Facility Documentation will include an affirmative covenant regarding compliance with the go to market provisions of the Fee Letter. Prior to the Initial Bridge Loan Maturity Date, the debt and lien incurrence and the restricted payment covenants of the Bridge Loans may be more restrictive than those of the Senior Secured Facilities, Extended Term Loans and the Exchange Notes, as reasonably agreed by the Administrative Agent and the Borrower. The Bridge Facility Documentation will provide that the Borrower shall be prohibited from paying the Deferred Payment Obligation, the principal of the Deferred Payment Subordinated Note or any cash interest (but not the payment of interest up to the Total Deferred Payment Cap through an increase in principal amount of the Deferred Payment Subordinated Note) in respect of the Deferred Payment Subordinated Note in excess of the Deferred Payment Cash Cap (other than through the conversion of any such amounts into common equity of MedAssets and the exercise of rights of set-off, indemnification or purchase price adjustments, in each case, in accordance with the terms of the Purchase Agreement and the Deferred Payment Subordinated Note) (each such payment, a Deferred Restricted Payment) except for (A) such Deferred Restricted Payments if after giving effect to each such payment (and any incurrence of debt or related transactions to occur on the date of such payment) on a pro forma basis (i) no default or event of default shall have |
Exhibit C-5
occurred and is continuing under the Bridge Facility Documentation and (ii) the Total Leverage Ratio would be less than 5.0 to 1.0 (it being understood that any such payment shall reduce the amount available for future restricted payments pursuant to the restricted payments build up basket but shall not affect the ability to make future Deferred Restricted Payments pursuant to the provisions described herein), (B) Deferred Restricted Payments required pursuant to the terms of the Purchase Agreement and the Deferred Payment Subordinated Notes upon any asset sale or change of control provided that the Borrower has first complied with its obligations set forth above under Mandatory Prepayments and (C) the making of Deferred Restricted Payments out of the proceeds of subordinated indebtedness constituting Permitted Refinancing Indebtedness (to be defined in a customary manner). | ||
Financial Maintenance
Covenants:
|
None. | |
Events of Default:
|
Limited to: nonpayment of principal, interest or other amounts; violation of covenants; incorrectness of representations and warranties in any material respect; cross acceleration to material indebtedness; bankruptcy or insolvency of the Borrower or its significant subsidiaries; material monetary judgments; ERISA events; and actual or asserted invalidity of guarantees. | |
Cost and Yield
Protection:
|
The Bridge Facility Documentation will include customary tax gross-up, cost and yield protection provisions. | |
Assignments and
Participation:
|
Subject to the prior notification of the Administrative Agent, the Lenders will have the right to assign Initial Bridge Loans after the Closing Date (other than to Disqualified Lenders) in consultation with, but without the consent of, the Borrower; provided, however, that prior to the Initial Bridge Loan Maturity Date, unless there has been a Demand Failure Event or a payment or bankruptcy event of default, the consent of the Borrower shall be required with respect to any assignment by any Initial Bridge Lender if, subsequent thereto, such Initial Bridge Lender would hold, in the aggregate, less than 51% of the outstanding Initial Bridge Loans made by it on the Closing Date and not subsequently repaid. | |
The Lenders will have the right to participate their Initial Bridge Loans to other financial institutions without |
Exhibit C-6
restriction, other than customary voting limitations. Participants will have the same benefits as the selling Lenders would have (and will be limited to the amount of such benefits) with regard to yield protection and increased costs, subject to customary limitations and restrictions. | ||
Voting:
|
Amendments and waivers of the Bridge Facility Documentation will require the approval of Lenders holding more than 50% of the outstanding Initial Bridge Loans, except that (a) the consent of each directly and adversely affected Lender will be required for (i) reductions of principal, interest rates or the Applicable Margin, (ii) extensions of the Initial Bridge Loan Maturity Date (except as provided under Maturity above) or the Extended Maturity Date, (iii) additional restrictions on the right to exchange Extended Term Loans for Exchange Notes or any amendment of the rate of such exchange and (iv) pro rata payment and sharing provisions (except any amendment to allow pro rata prepayment offers on terms similar to those provided in Exhibit B), and (b) the consent of 100% of the Lenders will be required with respect to modifications to any of the voting percentages and releases of all or substantially all of the value of the Guarantees (other than in connection with any release or sale of the relevant Guarantor permitted by the Senior Secured Facilities Documentation or the Bridge Facility Documentation). | |
Expenses and
Indemnification:
|
The Borrower shall pay all reasonable and documented or invoiced out-of-pocket costs and expenses of the Administrative Agent and the Commitment Parties (without duplication) associated with the syndication of the Bridge Facility and the preparation, execution and delivery, administration, amendment, modification, waiver and/or enforcement of the Bridge Facility Documentation (including the reasonable fees, disbursements and other charges of counsel identified herein or otherwise retained with the Borrowers consent)). | |
The Borrower will indemnify the Administrative Agent, the Commitment Parties, the Lenders and their affiliates, and the officers, directors, employees, advisors, agents, controlling parties and other representatives and their successors and permitted assigns of each of the foregoing, and hold them harmless from and against all losses, claims, damages, liabilities and reasonable and documented or invoiced out-of-pocket fees and expenses (including reasonable fees, disbursements and other charges of one counsel for all |
Exhibit C-7
indemnified parties and, if necessary, one firm of local counsel in each appropriate jurisdiction (which may include a single special counsel acting in multiple jurisdictions) for all indemnified parties (and, in the case of an actual or perceived conflict of interest, where the indemnified person affected by such conflict informs the Borrower of such conflict and thereafter retains its own counsel, of another firm of counsel for such affected indemnified person)) of any such indemnified person arising out of or relating to any claim or any litigation or other proceeding to the Transactions, including the financing contemplated hereby (regardless of whether such indemnified person is a party thereto and whether or not such proceedings are brought by the Borrower, its equity holders, its affiliates, creditors or any other third person) that relates to the Transactions, including the financing contemplated hereby; provided that no indemnified person will be indemnified for any loss, claim, damage, liability, cost or expense to the extent it has resulted from (i) the gross negligence or willful misconduct of such person or any of its affiliates or controlling persons or any of the officers, directors, employees, advisors, agents or members of any of the foregoing (as determined by a court of competent jurisdiction in a final and non-appealable decision) or (ii) a material breach by any such person or one of its affiliates (as determined by a court of competent jurisdiction in a final and non-appealable decision). | ||
Governing Law and Forum:
|
New York. | |
Counsel to the
Administrative
Agent and Lead Arrangers:
|
Cahill Gordon & Reindel LLP. |
Exhibit C-8
ANNEX I to
EXHIBIT C
EXHIBIT C
Extended Term Loans
Maturity
|
The Extended Term Loans will mature on the date that is eight years after the Closing Date. | |
Interest Rate:
|
The Extended Term Loans will bear interest at an interest rate per annum equal to the Total Cap. | |
Interest shall be payable in arrears semi-annually commencing on date that is six months following the Initial Bridge Loan Maturity Date and ending on the maturity date of the Extended Term Loans, computed on the basis of a 360 day year. | ||
Default Rate:
|
Overdue principal, interest, fees and other amounts shall bear interest at the applicable interest rate plus 2.00% per annum. | |
Guarantees:
|
Same as the Initial Bridge Loans. | |
Covenants, Defaults and
Mandatory Prepayments:
|
Upon and after the Extension Date, the covenants, mandatory prepayments and defaults that would be applicable to the Exchange Notes, if issued, will also be applicable to the Extended Term Loans in lieu of the corresponding provisions of the Bridge Facility Documentation. | |
Optional Prepayment:
|
The Extended Term Loans may be prepaid, in whole or in part, at par, plus accrued and unpaid interest upon not less than one business days prior written notice, at the option of the Borrower at any time. |
C-I-1
ANNEX II to
EXHIBIT C
EXHIBIT C
Exchange Notes | ||
Issuer:
|
The Borrower will issue the Exchange Notes under an indenture capable of being qualified under the Trust Indenture Act of 1939, as amended. The Borrower, in its capacity as the issuer of the Exchange Notes, is referred to as the Issuer. | |
Principal Amount:
|
The Exchange Notes will be available only in exchange for the Extended Term Loans on or after the Extension Date. The principal amount of any Exchange Note will equal 100% of the aggregate principal amount of the Extended Term Loan for which it is exchanged. In the case of a partial exchange, the minimum amount of Extended Term Loans to be exchanged for Exchange Notes will be $50 million. | |
Maturity:
|
The Exchange Notes will mature on the date that is eight years after the Closing Date. | |
Interest Rate:
|
The Exchange Notes will bear interest payable semi-annually, in arrears, at a rate equal to the Total Cap. | |
Guarantees:
|
Same as Initial Bridge Loans and Extended Term Loans. | |
Offer to Purchase from
Asset Sale Proceeds:
|
The Issuer will be required to make an offer to repurchase the Exchange Notes (and, if outstanding, prepay the Extended Term Loans) on a pro rata basis, which offer shall be at 100% of the principal amount thereof plus accrued and unpaid interest to the date of repurchase with a portion of the net cash proceeds from any non-ordinary course asset sales or dispositions (including as a result of casualty or condemnation) by the Borrower or any of its restricted subsidiaries in excess of amounts either reinvested in the business of the Borrower or its restricted subsidiaries or required to be paid to the lenders under the Senior Secured Facilities or the holders of certain other indebtedness, with such proceeds being applied to the Extended Term Loans, the Exchange Notes and the Notes in a manner to be agreed, subject to other exceptions and baskets usual and customary for financings of this type and consistent with the Applicable Bond Standard and in any event not less favorable to the Borrower than those applicable to the Senior Secured Facilities. |
C-II-1
Offer to Purchase
upon
Change of Control:
|
The Issuer will be required to make an offer to repurchase the Exchange Notes following the occurrence of a change of control (to be defined in a manner consistent with the Applicable Bond Standard) at a price in cash equal to 101% of the outstanding principal amount thereof, plus accrued and unpaid interest to the date of repurchase. | |
Optional
Redemption:
|
Exchange Notes will be non callable until the fourth anniversary of the Closing Date. Thereafter, each such Exchange Note will be callable at par plus accrued interest plus a premium equal to one half of the coupon on such Exchange Note, which premium shall decline ratably on each subsequent anniversary of the Closing Date to zero on the date that is two years prior to the maturity of the Exchange Notes. | |
Prior to the fourth anniversary of the Closing Date, the Issuer may redeem such Exchange Notes at a make-whole price based on U.S. Treasury notes with a maturity closest to the fourth anniversary of the Closing Date plus 50 basis points. | ||
Prior to the third anniversary of the Closing Date, the Issuer may redeem up to 35% of such Exchange Notes with proceeds from an equity offering at a price equal to par plus the coupon on such Exchange Notes. | ||
The optional redemption provisions will be otherwise customary for publicly traded high yield transactions. | ||
Defeasance and
Discharge Provisions:
|
Customary for publicly traded high yield debt securities and consistent with the Applicable Bond Standard. | |
Modification:
|
Customary for publicly traded high yield debt securities and consistent with the Applicable Bond Standard. | |
Registration
Rights:
|
The Issuer shall use commercially reasonable efforts to file, within 180 days after the first issuance of Exchange Notes (the date of such issuance, the Issue Date), and will use commercially reasonable efforts to cause to become effective, as soon thereafter as practicable on or prior to the date which is 360 days following the Issue Date, a shelf registration statement with respect to the Exchange Notes (such registration statement, a Shelf Registration Statement), which Shelf Registration Statement shall contain all financial statements required under the Securities Act of 1933, as amended (the Act). If a Shelf Registration Statement is filed, the Issuer will keep such Shelf Registration Statement effective and available (subject to |
C-II-2
customary exceptions) until it is no longer needed to permit unrestricted resales of the Exchange Notes; provided that in no event shall the Issuer be required to keep such Shelf Registration Statement effective and available for more than two years after the Issue Date. If within 360 days from the Issue Date, a Shelf Registration Statement has not been declared effective, then the Issuer will pay additional interest of 0.25% per annum on the principal amount of Exchange Notes (which rate of additional interest shall increase by 0.25% per annum after 90 days to a maximum of 1.00% per annum) to the holders of such Exchange Notes. The Issuer will also pay such additional interest to the holder of an Exchange Note for any period of time (subject to customary exceptions) following the effectiveness of the Shelf Registration Statement with respect to such Exchange Note that such Shelf Registration Statement is not available for sales thereunder, subject to the time limitations set forth in the second sentence of this paragraph. All accrued additional interest will be paid in arrears on each semi-annual interest payment date. | ||
Right to Transfer
Exchange Notes:
|
The holders of the Exchange Notes shall have the absolute and unconditional right to transfer such exchange notes in compliance with applicable law to any third parties. | |
Covenants:
|
Customary for publicly traded high yield debt securities and consistent with the Applicable Bond Standard and with provisions applicable to the making of Deferred Restricted Payments identical to those applicable under the Bridge Facility Documentation as described above. | |
Events of
Default:
|
Customary for publicly traded high yield debt securities and consistent with the Applicable Bond Standard. | |
Governing Law
and Forum:
|
State of New York. |
C-II-3
EXHIBIT D
Project Barracuda
Summary of Additional Conditions3
Summary of Additional Conditions3
The initial borrowings under the Credit Facilities shall be subject to the following
conditions:
1. Since December 31, 2009, there shall not have occurred any Company Material Adverse Effect.
For purposes of this paragraph, Company Material Adverse Effect means any change, development,
circumstance, effect, event or fact that, individually or in the aggregate, has a material adverse
effect upon the financial condition, business, assets, liabilities or results of operations of the
Group Companies (as defined in the Purchase Agreement), taken as a whole; provided, however, that
any change, development, circumstance, effect, event or fact arising from or related to (i)
conditions affecting the United States economy generally, (ii) any national or international
political or social conditions, including the engagement by the United States in hostilities,
whether or not pursuant to the declaration of a national emergency or war, or the occurrence of any
military or terrorist attack upon the United States, or any of its territories, possessions, or
diplomatic or consular offices or upon any military installation, equipment or personnel of the
United States, (iii) financial, banking or securities markets (including any disruption thereof and
any decline in the price of any security or any market index), (iv) changes in GAAP (as defined in
the Purchase Agreement) (or in the enforcement or interpretations thereof), (v) changes in any Law
(as defined in the Purchase Agreement) or other binding directives issued by any Governmental
Entity (as defined in the Purchase Agreement) (or in the enforcement or interpretations thereof),
(vi) any change that is generally applicable to the industries or markets in which the Group
Companies (as defined in the Purchase Agreement) operate, (vii) any failure by the Company to meet
any internal or published projections, forecasts or revenue or earnings predictions for any period
(provided, however, that any change, effect, event or occurrence that caused or contributed to such
failure to meet projections, forecasts or predictions shall not, subject to the other provisions of
this definition, be excluded) or (viii) the negotiation, execution, announcement or performance of
the Purchase Agreement and the transactions contemplated thereby, or the consummation of the
transactions contemplated thereby, including the identity of MedAssets, shall not be taken into
account in determining whether a Company Material Adverse Effect has occurred; provided that,
with respect to a matter described in any of the foregoing clauses (i), (ii), (iii), (iv) and (vi),
such matter shall only be excluded to the extent (and only to the extent) that such matter does not
have a disproportionate effect on the Group Companies, taken as a whole, relative to other
comparable entities operating in the industry in which the Group Companies operate; provided,
further, that with respect to references to Company Material Adverse Effect in Section 3.5 of the
Purchase Agreement, the exclusion in clause (viii) shall not apply. For purposes of this
definition, (A) if (x) on or after the date hereof any customer, supplier or other business
relation of any Group
3 | Capitalized terms used in this Exhibit D shall have the meanings set forth in the other Exhibits attached to the Commitment Letter to which this Exhibit D is attached (the Commitment Letter). In the case of any such capitalized term that is subject to multiple and differing definitions, the appropriate meaning thereof in this Exhibit D shall be determined by reference to the context in which it is used. |
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Company terminates or gives notice of its intent to terminate its relationship with such Group
Company and (y) at the time of such termination, no Group Company is in breach of any contractual
obligation owing to such business relation that gives such business relation the right to terminate
such relationship, and (B) if after the date hereof any customer of any Group Company elects not to
renew its relationship with the Group Companies or elects to renew such relationship on terms less
favorable to the Group Companies (each of (A) and (B), an Engagement Termination), then such
Engagement Termination shall be presumed to have been the result of the announcement of the
transactions contemplated by the Purchase Agreement and, pursuant to clause (viii) above, such
Engagement Termination and the consequences thereof shall not be taken into account in determining
whether a Company Material Adverse Effect has occurred.
2. Immediately prior to the initial borrowings under the Credit Facilities, no payment default
or payment event of default with respect to principal, interest or fees due to the lenders
thereunder shall have occurred and shall be continuing under the existing credit agreement of
MedAssets (without giving effect to any amendment or waiver thereunder after the date hereof).
3. The Acquisition shall have been consummated, or substantially simultaneously with the
initial borrowing under the Senior Secured Facilities and the initial borrowing under the Bridge
Facility and/or the issuance of the Notes, shall be consummated, in all material respects in
accordance with the terms of the Purchase Agreement as in effect on the date hereof, without giving
effect to any modifications, amendments, consents or waivers by you thereto that are material and
adverse to the Lenders or the Joint Lead Arrangers (it being understood that (i) any change of the
amount of the Acquisition Consideration that is either (x) an increase in the aggregate Acquisition
Consideration or (y) a decrease in the aggregate Acquisition Consideration in excess of 7.5% of the
total value of the Acquisition Consideration shall, in each case, be deemed to be material and
adverse to the interest of the Lenders and the Joint Lead Arrangers and (ii) (x) any change of the
amount of the Acquisition Consideration that is a decrease in the aggregate Acquisition
Consideration that is less than or equal to 7.5% of the total value of the Acquisition
Consideration or (y) the consummation of any Required Divestiture, shall not be deemed material and
adverse to the interest of the Lenders and the Joint Lead Arrangers but the amount of such decrease
and the net cash proceeds from such Required Divestiture, respectively, shall reduce on a dollar
for dollar basis the aggregate amount of the commitments of the Initial Bridge Lenders (on a pro
rata basis in accordance with their respective commitment amounts and, in the case of a Required
Divestiture, only to the extent such Required Divestiture is consummated prior to the Closing Date)
in respect of the Bridge Facility), without the prior consent of the Joint Lead Arrangers.
4. Substantially concurrently with the consummation of the Acquisition and the initial funding
under the Credit Facilities, the Refinancing shall have been consummated.
5. The Joint Lead Arrangers shall have received (a) audited consolidated balance sheets of
MedAssets and the Company (or, so long as the Company has no significant assets, operations or
liabilities other than the equity interests of The Broadlane Group, Inc. (BGI), a Delaware
corporation and wholly owned direct subsidiary of the Company, BGI) respectively, and related
statements of income, changes in equity and cash flows of MedAssets
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and the Company (or to the extent provided above, BGI) for the three most recently completed
fiscal years ended at least 90 days before the Closing Date and (b) unaudited consolidated balance
sheets and related statements of income, changes in equity and cash flows of MedAssets and the
Company (or to the extent provided above, BGI), respectively, for each subsequent fiscal quarter
after December 31, 2009 ended at least 45 days before the Closing Date, in each case, prepared in
accordance with U.S. GAAP.
6. The Joint Lead Arrangers shall have received a pro forma consolidated balance sheet and
related pro forma consolidated statement of income of MedAssets for the most recent fiscal year of
MedAssets referred to in Section 5(a) above and as of and for the interim and twelve-month period
ending on the last day of the most recently completed four-fiscal quarter period ended at least 45
days prior to the Closing Date (or, if the most recently completed fiscal period is the end of a
fiscal year, ended at least 90 days before the Closing Date), prepared after giving effect to the
Transactions as if the Transactions had occurred as of such date (in the case of such balance
sheet) or at the beginning of such periods (in the case of such other financial statements), in
accordance with Regulation S-X but, in any event to include all adjustments reflected in the
MedAssets Model (including the run-rate cost savings identified therein) and such other adjustments
and deviations from Regulation S-X as may be reasonably agreed.
7. With respect to the Senior Secured Facilities, subject in all respects to the Closing Date
Conditions Provision, all documents and instruments required to create and perfect the
Administrative Agents (as defined in Exhibit B) security interest in the Collateral (as defined in
Exhibit B) shall have been executed and delivered and, if applicable, be in proper form for filing.
8. The Administrative Agent and the Joint Lead Arrangers shall have received all documentation
and other information about MedAssets and the Guarantors as has been reasonably requested in
writing at least 10 days prior to the Closing Date by the Administrative Agent or the Joint Lead
Arrangers that they reasonably determine is required by regulatory authorities under applicable
know your customer and anti-money laundering rules and regulations, including without limitation
the PATRIOT Act.
9. With respect to the Senior Secured Facilities, the Joint Lead Arrangers shall have had a
period of not less than 20 consecutive business days (provided that such period shall either end
prior to December 18, 2010 or commence following January 3, 2011) after completion of a customary
confidential information memorandum with respect to the Senior Secured Facilities to market and
syndicate the Senior Secured Facilities. With respect to the Bridge Facility, (a) you shall have
provided to the Investment Bank (as defined in the Fee Letter) not later than 20 business days
(unless a shorter period is reasonably acceptable to the Investment Bank) prior to the Closing Date
(i) a completed customary offering memorandum suitable for use in a customary high yield road
show relating to the Notes (collectively, the Offering Document) and in customary form for
offering memoranda used in Rule 144A offerings, including discussion of the Borrower, financial
statements, pro forma financial statements and other financial data of the type and form
customarily included in offering memoranda (other than consolidating and other financial statements
and data with respect to guarantor and non-guarantor subsidiaries), and all other data that would
be necessary for the Investment Bank to receive customary comfort from independent accountants in
connection
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with the offering of the Notes and (ii) drafts of customary comfort letters by auditors of the
Borrower which such auditors are prepared to issue upon completion of customary procedures, each in
form and substance customary for high yield debt securities offerings and (b) the Investment Bank
shall have been afforded a period of at least 20 consecutive business days (unless a shorter period
is reasonably acceptable to the Investment Bank) (provided that such period shall either end prior
to December 18, 2010 or commence following January 3, 2011) following receipt of the Offering
Documents including the information described in clause (a) to seek to place the Notes with
qualified purchasers thereof.
10. With respect to (1) the Senior Secured Facilities or (2) the Bridge Facility, the closing
of such Credit Facilities shall have occurred on or before the Expiration Date.
11. Immediately after giving effect to the Transactions, the ratio of consolidated total
indebtedness (excluding for this purpose the Deferred Payment Obligation) of the Borrower as of the
Closing Date to pro forma Consolidated EBITDA of the Borrower for the most recent four fiscal
quarter period for which financial statements have been delivered (with those pro forma adjustments
permitted by Regulation S-X and, without duplication, (x) anticipated pro forma cost savings of up
to $20.0 million expected to be realized on a run rate basis not later than the later to occur of
(A) December 31, 2011 and (y) the one year anniversary of the Closing Date and identified in the
MedAssets Model, (y) add backs for non-recurring severance and restructuring charges in connection
with the Transactions of up to $20.0 million which otherwise reduced Consolidated EBITDA for the
applicable four quarter period and (z) the appropriate adjustments to reflect the effects of any
Required Divestiture whether or not consummated prior to the Closing Date) shall be not greater
than 5.5 to 1.0; provided that it is understood and agreed that MedAssets may reduce the amount of
the Credit Facilities by up to $75.0 million from the maximum committed amounts pursuant to the
Commitment Letter in order to facilitate the satisfaction of this condition.
12. The Borrower shall have obtained at least 20 business days prior to the Closing Date,
ratings for Credit Facilities and the Notes from each of S&P and Moodys and a public corporate
credit rating and a public corporate family rating in respect of each of the Borrower and the
Company after giving effect to the Transactions from each of S&P and Moodys, respectively.
13. The execution and delivery of (i) the Senior Secured Facilities Documentation and, if
applicable, the Bridge Facilities Documentation (collectively, the Facilities Documentation)
which shall, in each case, be consistent with the Commitment Letter, Term Sheets and Fee Letter and
subject to the Closing Date Conditions Provision set forth in the Commitment Letter and (ii)
customary legal opinions, customary evidence of authorization, customary officers certificates,
good standing certificates (to the extent applicable) and a solvency certificate of the Borrowers
chief financial officer (certifying that, after giving effect to the Transactions, the Borrower and
its subsidiaries on a consolidated basis are solvent) in form reasonably satisfactory to the Joint
Lead Arrangers.
14. All fees required to be paid on the Closing Date pursuant to the Fee Letter and reasonable
out-of-pocket expenses required to be paid on the Closing Date pursuant to the Commitment Letter,
to the extent invoiced at least three business days prior to the Closing Date,
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shall, upon the initial borrowing under the Credit Facilities, have been paid (which amounts
may be offset against the proceeds of the Credit Facilities).
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