AMENDMENT NO. 2 TO CREDIT AGREEMENT
Exhibit
10.1
Execution
Copy
AMENDMENT
NO. 2 TO CREDIT AGREEMENT
This
Amendment No. 2 to Credit Agreement, dated as of May __, 2009 (this “Amendment”), to the 364-Day
Bridge Term Loan Credit Agreement, dated as of March 12, 2009 (as the same may
be further amended, supplemented or otherwise modified from time to time, the
“Credit Agreement”),
entered into among Pfizer Inc., a Delaware corporation (the “Borrower”), the institutions
from time to time party thereto as Lenders (the “Lenders”) and JPMorgan Chase
Bank, N.A., in its capacity as administrative agent for the Lenders (in such
capacity, the “Administrative
Agent”), is entered into among the Borrower, the Required Lenders and the
Administrative Agent. Capitalized terms used herein and not otherwise
defined herein shall have the meanings ascribed to them in the Credit
Agreement.
W i t n e
s s e t h:
Whereas,
the Borrower has requested that the Credit Agreement be amended in certain
respects as set forth below;
Whereas,
pursuant to Section 10.03 of the Credit Agreement, the Credit Agreement may,
under certain circumstances, be amended with the written consent of the Required
Lenders; and
Whereas,
the Borrower and the Required Lenders have agreed, subject to the terms and
conditions hereinafter set forth, to amend the Credit Agreement pursuant to the
provision of Section 10.03 of the Credit Agreement referred to in the preceding
recital as set forth below;
Now,
Therefore, in
consideration of the premises and the covenants and obligations contained
herein, the sufficiency of which is hereby acknowledged, the parties hereto
agree as follows:
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Section
1.
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Amendments
to the Credit Agreement
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The Credit
Agreement is, effective as of the Effective Date (as defined below), hereby
amended as follows:
(a) The
following definitions in Section 1.01 are amended and
restated in their entirety to read as follows:
“Certain Significant
Items” shall mean substantive, unusual items that are evaluated on an
individual basis and may represent items that are not part of the Borrower’s
ongoing business; items that, either as a result of their nature or size, the
Borrower would not expect to occur as part of its normal business on a regular
basis; items that would be non-recurring; or items that relate to products it no
longer sells. Certain Significant Items shall include, but not be limited to, a
major non-acquisition-related restructuring charge and associated implementation
costs for a program which is specific in nature with a defined term, such as
those related to the Borrower’s cost-reduction initiatives; charges related to
certain sales or disposals of products or facilities that do not qualify as
discontinued operations as defined by U.S. GAAP; amounts associated with
transition service agreements in support of discontinued operations after sale;
certain intangible asset impairments; adjustments related to the resolution of
certain tax positions; the impact of adopting certain significant, event-driven
tax legislation, such as adjustments associated with charges attributable to the
repatriation of foreign earnings in accordance with the American Jobs Creation
Act of 2004; or possible charges related to legal matters. Normal, ongoing
defense costs of the Borrower or settlements and accruals on legal matters made
in the normal course of its business would not be considered Certain Significant
Items.
“EBITDA” shall mean,
with respect to any Person, for any period, Consolidated Net Income attributable
to such Person for such period plus (a) the sum of, in each case to the extent
included in the calculation of such Consolidated Net Income but without
duplication,
(i) federal,
state, local or foreign income Taxes;
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(ii)
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depreciation
or amortization expenses;
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(iii) interest
expenses (net of interest income);
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(iv)
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fees
and expenses related to the Acquisition (as such fees and expenses are
disclosed in the Borrower’s most recent financial statements filed with
the SEC);
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(v) extraordinary,
non-recurring or unusual losses or expenses (including costs and expenses
related to the Borrower’s ongoing cost-reduction initiatives including the cost
reduction initiative program announced January 2009, or a substantially similar
cost reduction initiative program created in conjunction with the Acquisition,
including implementation costs and restructuring costs not to exceed
$7,500,000,000 in the aggregate during the term of this Agreement);
(vi) Purchase
Accounting Adjustments, less Purchase Accounting Adjustments related to
“Intangible amortization and other,” as disclosed in the Borrower’s financial
statements filed as an exhibit to its Annual Report on Form 10-K or Quarterly
Report on Form 10-Q, as applicable;
(vii) discontinued
operations to the extent segregated in the Consolidated statements of income,
stockholders’ equity and cash flows of the Borrower;
(viii) Identified
Legal Settlements; and
(ix) non-cash
Certain Significant Items not included above in clauses (i) through (viii) and
cash Certain Significant Items not included above in clauses (i) through (viii)
to the extent such items do not exceed $1,000,000,000 in the aggregate for any
such period,
in each
case, for such period, and minus (b) without
duplication and to the extent included in determining such Consolidated Net
Income, the sum of all income or gains attributed to such items for such period;
provided that
(1) if the Acquisition or a Material Transaction has occurred during such
period, EBITDA shall be determined for such period on a pro forma basis as if
such Material Transaction or the Acquisition has occurred on the first day of
such period and (2) if the cash consideration for the Acquisition is financed
with proceeds of Permitted Repurchase Debt of the type described in clause (b)
of the definition thereof incurred in the period prior to the consummation of
the Acquisition and the Acquisition has occurred within ten days after the end
of such prior period, EBITDA shall be determined for such prior period on a pro
forma basis as if the Acquisition had occurred on the first day of such prior
period.
(b) The
following definitions are added to Section 1.01 and each such
defined term is to appear in its appropriate place in alphabetical order as
follows:
“Identified Legal
Settlements” shall mean (i) up to $2,313,000,000 in charges resulting
from an agreement in principle with the U.S. Department of Justice to resolve
the previously reported investigation regarding allegations of past off-label
promotional practices concerning Bextra, as well as certain other open
investigations, as disclosed in Footnote F in the Borrower’s 2008 Financial
Report filed as an exhibit to its Form 10-K (ii) up to $936,000,000 related to
the agreements and agreements in principle to resolve certain NSAID litigation
and claims, as disclosed in Footnote F in the Borrower’s 2008 Financial Report
filed as an exhibit to its Form 10-K, and (iii) on or after the Funding Date,
cash disbursements of up to $500,000,000 by Wyeth relating to litigation related
to the diet drug commonly referred
to as “fen-phen”, as disclosed in Note 15
(“Contingencies and Commitments”) in its 2008 Financial Report filed as an
exhibit to its Form 10-K.
“Purchase Accounting
Adjustments” shall mean all non-cash purchase accounting adjustments and
charges, including charges for purchased in-process research and development,
the incremental charge to cost of sales from the sale of acquired inventory that
was written up to fair value and the incremental charges related to the
amortization of finite-lived intangible assets for the increase to fair
value.
(c) Schedule
3 of Exhibit G (Compliance Certificate) is hereby amended and restated in its
entirety in the form attached as Exhibit A hereto.
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Section
2.
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Conditions
Precedent to the Effectiveness of this
Amendment
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This Amendment shall become effective
(the “Effective Date”) upon satisfaction of the following conditions
precedent:
(a) the
Administrative Agent shall have received this Amendment, duly executed by the
Borrower and the Required Lenders;
(b) the
conditions to the effectiveness of Amendment No. 1 to the Revolving Credit
Facility, dated as of the date hereof, shall have been satisfied;
(c) each
of the representations and warranties of the Borrower contained in Sections
4.01, 4.02, 4.04(b), 4.05, 4.08 and 4.13 of the Credit Agreement are true and
correct in all material respects on and as of the Effective Date, in each case
as if made on and as of such date and except to the extent that such
representations and warranties specifically relate to a specific date, in which
case such representations and warranties shall be true and correct in all
material respects as of such specific date; provided, however, that references
therein to the “Agreement” shall be deemed to refer to the Credit Agreement as
amended hereby and after giving effect to the consents and waivers set forth
herein; and
(d)
no Default or Event of Default has occurred and is continuing.
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Section
3.
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Reference
to the Effect on the Loan Documents
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(a) As
of the date hereof, each reference in the Credit Agreement to “this Agreement,”
“hereunder,” “hereof,” “herein,” or words of like import, and each reference in
the other Loan Documents to the Credit Agreement (including, without limitation,
by means of words like “thereunder”, “thereof” and words of like import), shall
mean and be a reference to the Credit Agreement as modified hereby, and this
Amendment and the Credit Agreement shall be read together and construed as a
single instrument.
(b) Except
as expressly modified hereby, all of the terms and provisions of the Credit
Agreement and all other Loan Documents are and shall remain in full force and
effect and are hereby ratified and confirmed.
(c) The
execution, delivery and effectiveness of this Amendment shall not, except as
expressly provided herein, operate as a waiver of any right, power or remedy of
the Lenders or the Administrative Agent under any of the Loan Documents, nor
constitute a waiver or amendment of any other provision of any of the Loan
Documents or for any purpose except as expressly set forth herein.
(d) This
Amendment shall be deemed a Loan Document.
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Section
4.
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Execution
in Counterparts
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This
Amendment may be executed in any number of counterparts and by different parties
in separate counterpart (including by facsimile and electronic mail), each of
which when so executed shall be deemed to be an original and all of which taken
together shall constitute one and the same agreement. Signature pages
may be detached from multiple separate counterparts and attached to a single
counterpart so that all signature pages are attached to the same
document. Delivery of an executed counterpart by telecopy or
electronic mail shall be effective as delivery of a manually executed
counterpart of this Amendment.
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Section
5.
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Representations
and Warranties
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The Borrower hereby represents and
warrants to the Administrative Agent and each Lender as follows:
(a) this
Amendment has been duly authorized, executed and delivered by the Borrower and
constitutes a legal, valid and binding obligation of the Borrower enforceable
against the Borrower in accordance with its terms and the Credit Agreement
constitutes the legal, valid and binding obligation of the Borrower, enforceable
against the Borrower in accordance with its terms, subject to bankruptcy,
insolvency, reorganization, moratorium and similar laws of general applicability
relating to or affecting creditors’ rights and to general equity
principles;
(b) each
of the representations and warranties of the Borrower contained in Sections
4.01, 4.02, 4.04(b), 4.05, 4.08 and 4.13 are true and correct in all material
respects on and as of the Effective Date, in each case as if made on and as of
such date and except to the extent that such representations and warranties
specifically relate to a specific date, in which case such representations and
warranties shall be true and correct in all material respects as of such
specific date; provided, however, that references therein to the “Credit
Agreement” shall be deemed to refer to the Credit Agreement as amended hereby
and after giving effect to the consents and waivers set forth herein;
and
(c) no Default or Event of
Default has occurred and is continuing.
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Section
6.
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Governing
Law
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This
Amendment shall be governed by and construed in accordance with the law of the
State of New York.
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Section
7.
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Section
Titles
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The
Section titles contained in this Amendment are and shall be without substantive
meaning or content of any kind whatsoever and are not a part of the agreement
between the parties hereto.
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Section
8.
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Notices
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All
communications and notices hereunder shall be given as provided in the Credit
Agreement.
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Section
9.
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Severability
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The fact
that any term or provision of this Agreement is held invalid, illegal or
unenforceable as to any person in any situation in any jurisdiction shall not
affect the validity, enforceability or legality of the remaining terms or
provisions hereof or the validity, enforceability or legality of such offending
term or provision in any other situation or jurisdiction or as applied to any
person.
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Section
10.
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Successors
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The terms
of this Amendment shall be binding upon, and shall inure to the benefit of, the
Lenders, the other parties hereto and their respective successors and
assigns.
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Section
11.
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Waiver
of Jury Trial
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Each of
the parties hereto irrevocably waives trial by jury in any action or proceeding
with respect to this Amendment.
[Signature
Pages Follow]
In Witness
Whereof, the
parties hereto have caused this Amendment to be executed by their respective
officers thereunto duly authorized, as of the date first written
above.
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as
Borrower
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By:
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Name:
Xxxxxxx X Xxxxxx
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Title: Senior
Vice President &
Treasurer
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JPMORGAN
CHASE BANK, N.A.,
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as
Administrative Agent
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By:
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Name:
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Title:
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[NAME
OF LENDER]
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By:
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Name:
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Title:
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EXHIBIT
A
For
the Quarter/Year ended on the Financial Statement Date
SCHEDULE
3
to the Compliance
Certificate
($ in
000s)
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EBITDA
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A.
Consolidated Net Income attributable to the Company for the last four
fiscal quarter period ended on the Financial Statement Date (see
definition of “EBITDA”):
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1.
Net income (or loss) attributable to the Company for such period, as
reflected in the Consolidated statements of income of the Company most
recently filed with the SEC (see definition of “Consolidated
Net Income”):
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$
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2.
Net income of any other Person not Consolidated into the net income of the
Company in which the Company or a Subsidiary has a joint interest with a
third party to the extent paid to the Company or a Subsidiary as dividends
or distributions (see definition of “Consolidated Net Income” –
proviso):
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$
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3.
Consolidated Net Income (Line A.1 plus Line A.2):
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$
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B.
Addbacks to Consolidated Net Income (in each case to the extent included
in the calculation of such Consolidated Net Income for such period but
without duplication) (see definition of “EBITDA” – clause
(a)):
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1.
Federal, state, local or foreign income taxes (see definition of “EBITDA”
– clause (a)(i)):
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$
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2.
Depreciation or amortization expenses (see definition of “EBITDA” – clause
(a)(ii)):
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$
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3.
Interest expenses (net of interest income) (see definition of “EBITDA” –
clause (a)(iii)):
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$
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4.
Fees and expenses related to the Acquisition (as such fees and expenses
are disclosed in the Borrower’s most recent financial statements filed
with the SEC) (see definition of “EBITDA” – clause
(a)(iv))
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$
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5.Extraordinary,
non-recurring or unusual losses or expenses (see definition of “EBITDA” –
clause (a)(v)):
a)Occurring
prior to December 31, 2008
b)Occurring after January 1,
2009
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a)$___________
b)$___________
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6.Purchase
Accounting Adjustments, less Purchase Accounting Adjustments related to “Intangible amortization and other,” as disclosed in the
Company’s financial statements filed as an exhibit to its Annual Report on
Form 10-K or Quarterly Report on Form 10-Q, as applicable 1 (see definition of
“EBITDA” – clause (a)(vi)):
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$
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7.Discontinued
operations to the extent segregated in the Consolidated statements of
income, stockholders’ equity and cash flows of the Company (see definition
of “EBITDA” – clause (a)(vii)):
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$
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8.Identified
Legal Settlements (see definition of “EBITDA” – clause
(a)(viii)):
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$
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9.
a)Non-cash
Certain Significant Items not included in clauses B(1) through
B(8)
b)Cash
Certain Significant Items not included in clauses B(1) through B(8) to the
extent such items do not exceed $1,000,000,000 in the aggregate for any
such period (see definition of “EBITDA” – clause (a)(ix)):
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a)$_________
b)$_________
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00.Xxxxx
permitted addbacks (sum of Lines B.1 through B.9):
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$
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C.Required
deductions from Consolidated Net Income (without duplication and to the
extent included in the calculation of such Consolidated Net Income for
such period) for any income or gains attributed to items in lines B1.
through B.9 above (see definition of “EBITDA” – clause
(b)):
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1.[Specify
item:]
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$
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2.[Specify
item:]
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$
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0.Xxxxx
required deductions (sum of Lines C.1 through C.[__]):
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$
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D.EBITDA
for the Company for the last four fiscal quarter period ending on
Financial Statement Date (Line A.3 plus Line B.9 minus Line
[C.3]):
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$
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Note: Line
items in this Compliance Certificate have been short handed for ease of
reference. In case of any conflict between the provisions of this
Compliance Certificate and the provisions of the Credit Agreement, the Credit
Agreement shall govern.
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Leverage Ratio
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A.Consolidated
Specified Debt of the Company and its Subsidiaries outstanding as of the
Financial Statement Date (see definition of “Leverage Ratio” – clause
(a)):
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1.Long
term debt on the Financial Statement Date of the Company and its
Subsidiaries consolidated in accordance with GAAP (as reflected in the
Consolidated Balance Sheet of the Company on the Financial Statement Date)
(see definition of “Specified Debt” and “Consolidated”)
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$
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2.Debt
maturing within one year on the Financial Statement Date of the Company
and its Subsidiaries consolidated in accordance with GAAP (as reflected in
the Consolidated Balance Sheet of the Company on the Financial Statement
Date) (see definition of “Specified Debt” and
“Consolidated”)
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$
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3.Consolidated
Specified Debt (sum of lines Line A.1 and A.2)
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$
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B.EBITDA
for the Company for the last four fiscal quarter period ending on
Financial Statement Date2 (see definition of “Leverage Ratio” –
clause (b)) (Line D of EBITDA above):
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$
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C.[Leverage
Ratio (Line A.3 divided by Line B)]3:
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___
to _1__
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Maximum
Permitted under Section 5:
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Period
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Ratio
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Until
the Commitments have expired or been terminated and the principal of and
interest on each Loan and all fees payable under the Credit Agreement have
been paid in full
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2.75
to
1
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Note: Line
items in this Compliance Certificate have been short handed for ease of
reference. In case of any conflict between the provisions of this
Compliance Certificate and the provisions of the Credit Agreement, the Credit
Agreement shall govern.
2 If the Acquisition or a Material
Transaction has occurred during such period, EBITDA shall be determined for such
period on a pro forma basis as if such Material Transaction or the Acquisition
has occurred on the first day of such period.
