THIRD AMENDMENT TO SECOND AMENDED AND RESTATED REVOLVING CREDIT AND SECURITY AGREEMENT
Exhibit 10.9
THIRD AMENDMENT TO SECOND AMENDED AND RESTATED REVOLVING CREDIT AND SECURITY AGREEMENT
This THIRD AMENDMENT TO SECOND AMENDED AND RESTATED REVOLVING CREDIT AND SECURITY AGREEMENT
(the “Third Amendment”) is made as of this 2nd day of October, 2006 by and between CAPITALSOURCE
FINANCE LLC, a Delaware limited liability company, with its chief executive office located at 0000
Xxxxxxx Xxxxxx, Xxxxx Xxxxx, Xxxxxxxx 00000 (“Lender”) and UNITED STATES PHARMACEUTICAL GROUP,
L.L.C. d/b/a NATIONSHEALTH, a Delaware limited liability company (“USPG”), NATIONSHEALTH HOLDINGS,
L.L.C., a Florida limited liability company (“NHH”), and NATIONSHEALTH, INC., a Delaware
corporation (“NationsHealth”) (jointly and severally, the “Borrower").
W I T N E S S E T H:
WHEREAS, Lender and Borrower (other than Nationshealth) entered into a certain Revolving
Credit and Security Agreement dated as of the 30th day of April, 2004 (the “Original
Credit Agreement") whereby Lender agreed to make loans, advances and other extensions of credit to
Borrower thereunder; and
WHEREAS, Lender and Borrower (other than Nationshealth) entered into a certain Amended and
Restated Revolving Credit and Security Agreement dated as of the 29th of June, 2004 (as
amended by the Prior Amendments (defined below), the “First Amended and Restated Agreement")
whereby Lender made available to Borrower (other than Nationshealth) a separate Overadvance
Facility and permitted Borrower (other than Nationshealth) to include its inventory within the
Borrowing Base for the Revolving Facility; and
WHEREAS, Lender and Borrower (other than Nationshealth) amended the First Amended and Restated
Agreement in certain respects pursuant to a certain First Amendment to Amended and Restated
Revolving Credit and Security Agreement dated as of the 10th day of August, 2004 (the
“Prior First Amendment"); and
WHEREAS, on August 31, 2004, Millstream Acquisition Corporation (“MAC”) changed its name to
Nationshealth, Inc.; and
WHEREAS, on August 31, 2004, N Merger, LLC, a wholly owned subsidiary of MAC, was merged with
and into NationsHealth Holdings, L.L.C. and as a result of the merger, NationsHealth Holdings,
L.L.C. continued as the surviving limited liability company; and
WHEREAS, Lender and Borrower amended the First Amended and Restated Agreement in certain
respects pursuant to a certain Joinder and Second Amendment to Amended and Restated Revolving
Credit and Security Agreement dated as of the 14th day of September, 2004 in order to
join Nationshealth, Inc. as a party to the Agreement (the “Prior Second Amendment"); and
WHEREAS, Lender and Borrower amended the First Amended and Restated Agreement in certain
respects pursuant to a certain Third Amendment to Amended and Restated Revolving Credit and
Security Agreement dated as of the 3rd day of November, 2004 (the “Prior Third Amendment”), a
certain Fourth Amendment to Amended and Restated Revolving Credit and Security Agreement dated as
of the 10th day of February, 2005 (the “Prior Fourth Amendment”), a certain Fifth Amendment to
Amended and Restated Revolving Credit and Security Agreement dated as of the 28th day of
February 2005 (the “Prior Fifth Amendment”), certain Sixth Amendment to
Amended and Restated
Revolving Credit and Security Agreement dated as of the 13th day of May, 2005 (the
"Prior Sixth Amendment”),
certain Seventh Amendment to Amended and Restated Revolving Credit and Security Agreement
dated as of the 29th day of July, 2005 (the “Prior Seventh Amendment”), and a certain
Eighth Amendment to Amended and Restated Revolving Credit and Security Agreement dated as of the
23rd day of August, 2005 (the “Prior Eighth Amendment”) and together with the Prior
First Amendment, the Prior Second Amendment, the Prior Third Amendment, the Prior Fourth Amendment,
the Prior Fifth Amendment, the Prior Sixth Amendment, and the Prior Seventh Amendment,
collectively, the “Prior Amendments"); and
WHEREAS, Lender and Borrower entered into a certain Second Amended and Restated Revolving
Credit and Security Agreement dated as of the 21st of March, 2006 (as amended hereby,
and as amended, restated, supplemented or otherwise modified from time to time, the “Agreement");
and
WHEREAS, Lender and Borrower amended the Second Amended and Restated Revolving Credit and
Security Agreement in certain respects pursuant to a certain First Amendment to Second Amended and
Restated Revolving Credit and Security Agreement dated the 11th day of August, 2006 (the
"First Amendment”), and a certain Consent, Waiver and Second Amendment to Second Amended and
Restated Revolving Credit and Security Agreement dated September 27th, 2006 (the “Second
Amendment”); and
WHEREAS, Borrower requested and Lender agreed to the further modification of certain
provisions of the Agreement upon the terms and subject to the conditions set forth herein; and
WHEREAS, Section 12.8 of the Agreement provides that no modification or amendment of the
Agreement shall be effective unless the same shall be in writing and signed by the parties thereto.
NOW, THEREFORE, in consideration of the promises and other mutual covenants contained herein,
the receipt and sufficiency of which is hereby acknowledged, Lender and Borrower agree as follows:
1. Amendment of Agreement. As of the Effective Date (defined below), Lender and
Borrower hereby agree to amend the Agreement as follows:
(a) Section 2.4 of the Agreement, entitled “Revolving Facility
Disbursements; Requirement to Deliver Borrowing Certificate” is hereby amended
and restated as follows:
| 2.4 | Revolving Facility Disbursements; Requirement to Deliver Borrowing Certificate |
||
So long as no Default or Event of Default shall have occurred and be
continuing, Borrower may give Lender irrevocable written notice
requesting an Advance under the Revolving Facility by delivering to
Lender not later than 11:00 a.m. (Eastern Standard Time) at least
one but not more than four Business Days before the proposed
borrowing date of such requested Advance (the “Borrowing Date"), a
completed Borrowing Certificate and relevant supporting
documentation satisfactory to Lender, which shall (i) specify the
proposed Borrowing Date of such Advance which shall be a Business
Day, (ii) specify the principal amount of such requested Advance,
(iii) certify the matters contained in Section 4.2, and (iv)
specify the amount of any Medicare or Medicaid recoupments and/or
recoupments of any third-party payor being sought, requested or claimed, or, to Borrower’s knowledge, |
threatened against Borrower or
Borrower’s Affiliates. Each time a
request for an Advance is made, and, in any event and regardless of
whether an Advance is being requested, on Tuesday of each week
during the Term (and so long as a Default or Event of Default
exists, more frequently if Lender shall so request) until the
Obligations are indefeasibly paid in cash in full and this Agreement
is terminated, Borrower shall deliver to Lender a Borrowing
Certificate accompanied by a separate detailed aging and
categorizing of Borrower’s accounts receivable and accounts payable
and such other supporting documentation with respect to the figures
and information in the Borrowing Certificate as Lender shall
reasonably request from a credit or security perspective or
otherwise. On each Borrowing Date, Borrower irrevocably authorizes
Lender to disburse the proceeds of the requested Advance to the
appropriate Borrower’s account(s) as set forth on Schedule
2.4, in all cases for credit to the appropriate Borrower (or to
such other account as to which the appropriate Borrower shall
instruct Lender) via Federal funds wire transfer no later than 4:00
p.m. (Eastern Standard Time). Notwithstanding any provision of this
Agreement to the contrary, if the average outstanding balance under
the Revolving Facility during any calendar month is less than
$2,500,000 Borrower acknowledges and agrees that Lender shall be
entitled to calculate interest and fees hereunder, including without
limitation, the calculations set forth in Sections 2.3, 2.5 and
3.3, as if the average outstanding balance for such calendar
month was $2,500,000. Notwithstanding the requirement of Borrower
delivering a Borrowing Certificate in connection with each requested
Advance, Borrower may give Lender irrevocable written notice
requesting an Advance under the Revolving Facility in an amount
necessary to make the total outstanding Advances at such time equal
to $2,500,000, and so long as (i) no Default or Event of Default
shall have occurred and be continuing, and (ii) Lender has a
Borrowing Certificate that is not more than four Business Days
before the proposed borrowing date of such requested Advance,
subject to Availablity, Lender may, in its sole discretion, disburse
the proceeds of such requested Advance. |
2. Conditions to Effectiveness. This Amendment shall be effective on the date (the
“Effective Date") upon which the following conditions precedent are satisfied:
(a) Borrower shall have delivered to Lender an executed copy of this Amendment duly executed
by an authorized officer of Borrower and each other agreement, document or instrument reasonably
requested by the Lender in connection with this Amendment, each in form and substance reasonably
satisfactory to Lender;
(b) the representations and warranties contained herein and in all other Loan Documents shall
be true and correct;
(c) no Default or Event of Default shall be in existence; and
(d) Lender shall have received all fees, charges and expenses payable to in connection with
this Amendment and the documentation related hereto, including, but not limited to, legal fees and
out-of-pocket costs (including in-house counsel fees and expenses).
3. Representations and Warranties.
(a) Notwithstanding any other provision of this Amendment, Borrower hereby confirms and makes
all of the representations and warranties set forth in the Agreement and other Loan Documents with
respect to such Borrower and this Amendment as of the date hereof and as of the Effective Date and
confirms that they are true and correct and no Default or Event of Default has occurred and is
continuing as of the date hereof.
(b) Borrower hereby represents and warrants as of the date of this Amendment and as of the
Effective Date as follows: (i) it is duly incorporated or organized, validly existing and in good
standing under the laws of its jurisdiction of organization; (ii) the execution, delivery and
performance by it of this Amendment, as applicable, are within its powers, have been duly
authorized, and do not contravene (A) its articles of organization, operating agreement, or other
organizational documents, or (B) any applicable law; (iii) no consent, license, permit, approval or
authorization of, or registration, filing or declaration with any Governmental Authority or other
Person, is required in connection with the execution, delivery, performance, validity or
enforceability of this Amendment, as applicable, by or against it; (iv) this Amendment has been
duly executed and delivered by it; (v) this Amendment constitutes its legal, valid and binding
obligations enforceable against it in accordance with its terms, except as enforceability may be
limited by applicable bankruptcy, insolvency, reorganization, moratorium or similar laws affecting
the enforcement of creditors’ rights generally or by general principles of equity; and (vi) after
giving effect to this Amendment, it is not in default under the Agreement and no Default or Event
of Default exists, has occurred or is continuing.
4. Expenses. Borrower shall pay all costs and expenses incurred by Lender or any of
its Affiliates, including, without limitation, documentation and diligence fees and expenses, all
search, audit, appraisal, recording, professional and filing fees and expenses and all other
out-of-pocket charges and expenses and reasonable attorneys’ fees and expenses, in connection with
entering into, negotiating, preparing, reviewing and executing this Amendment contemplated hereby
and all related agreements, documents and instruments, and all of the same, to the extent incurred
and not promptly reimbursed by Borrower, may be charged to Borrower’s account and shall be part of
the Obligations. If Lender or any of its Affiliates uses in-house counsel for any of the purposes
set forth above Borrower expressly agrees that its Obligations include reasonable charges for such
work commensurate with the fees that would otherwise be charged by outside legal counsel selected
by Lender or such Affiliate in its sole discretion for the work performed.
6. Effect of Amendment. Lender and Borrower hereby acknowledge and agree that except
as provided in this Amendment, the Agreement, the Note and the other Loan Documents remain in full
force and effect and have not been modified or amended in any respect, it being the intention of
Lender and Borrower that this Amendment and the Agreement be read, construed and interpreted as one
and the same instrument. The foregoing amendments are subject to Borrower executing and delivering
this Amendment and all additional documents required to be executed and delivered herein. In
addition, the foregoing does not constitute a waiver by Lender of any Default or Event of Default.
7. Confirmation of Agreements. Lender and Borrower hereby acknowledge and agree that,
except as provided in this Amendment, the Agreement, the Note and the other Loan Documents, and the
grant of the liens, security interests and other encumbrances thereunder, and their agreements,
covenants, obligations, representations and warranties thereunder and therein, are hereby expressly
ratified, confirmed and restated as of the date hereof.
8. References to Loan Documents. Each of the other Loan Documents are hereby modified
in such a manner as to be consistent with all modifications and agreements contained herein and to
the extent that all references therein to and descriptions therein of the Agreement and the Note
shall be deemed to refer to and describe the Agreement.
9. Capitalized Terms. All capitalized terms not otherwise defined in this Amendment
shall have the meanings ascribed to such terms in the Agreement.
10. Benefit. This Amendment shall inure to the benefit of and bind the parties hereto
and their respective successors and assigns.
11. Amendments. This Amendment may not be changed, modified, amended, restated,
waived, supplemented, discharged, canceled or terminated orally or by any course of dealing or in
any other manner other than by the written agreement of Lender and Borrower. This Amendment shall
be considered part of the Agreement for all purposes under the Agreement.
12. Headings and Counterparts. The captions in this Amendment are intended for
convenience and reference only and do not constitute and shall not be interpreted as part of this
Amendment and shall not affect the meaning or interpretation of this Amendment. This Amendment may
be executed in one or more counterparts, all of which taken together shall constitute but one and
the same instrument. This Amendment may be executed by facsimile transmission, which facsimile
signatures shall be considered original executed counterparts for all purposes, and each party to
this Amendment agrees that it will be bound by its own facsimile signature and that it accepts the
facsimile signature of each other party to this Amendment.
13. Governing Law; JURY TRIAL WAIVER. THIS AMENDMENT AND THE RIGHTS AND OBLIGATIONS
OF THE PARTIES UNDER THIS AMENDMENT SHALL BE GOVERNED BY AND CONSTRUED AND INTERPRETED IN
ACCORDANCE WITH THE CHOICE OF LAW PROVISIONS SET FORTH IN THE AGREEMENT AND SHALL BE SUBJECT TO THE
WAIVER OF JURY TRIAL AND NOTICE PROVISIONS OF THE AGREEMENT.
14. RELEASE BY BORROWER. By execution of this Amendment, Borrower acknowledges and
confirms that Borrower does not have any offsets, defenses or claims against Lender, or any of its
present or former subsidiaries, affiliates, officers, directors, shareholders, employees, agents,
representatives, attorneys, predecessors, successors or assigns whether asserted or unasserted. To
the extent that Borrower may have such offsets, defenses or claims, Borrower and each of its
successors, assigns, parents, subsidiaries, affiliates, predecessors, employees, agents, heirs,
executors, as applicable, jointly and severally, knowingly, voluntarily and intentionally waive,
release and forever discharge Lender, its subsidiaries, affiliates, officers, directors,
shareholders, employees, agents, attorneys, predecessors, successors and assigns, both present and
former (collectively the “Lender Affiliates”) of and from any and all actual or potential
claims, demands, damages, actions, requests for sanctions and causes of action, torts, obligations,
suits, debts, controversies, damages, judgments, executions, claims and demands whatsoever, all
other liabilities whether known or unknown, matured or unmatured, contingent or absolute, of any
kind or description whatsoever, either in law or in equity, asserted or unasserted which against
Lender and/or Lender Affiliates they ever had, now have, claim to have or may later have or which
any of any Borrower’s successors, assigns, parents, subsidiaries, affiliates, predecessors,
employees, agents, heirs, executors, as applicable, both present and former ever had, now
has, claim to have or may later have, upon or by reason of any manner, cause, causes or thing
whatsoever, including, without limitation, any presently existing claim or defense whether or not
presently suspected, contemplated or anticipated, and Borrower hereby agrees that Borrower is
collaterally estopped from asserting any claims against Lender or any of the Lender Affiliates
relating to the foregoing.
15. Entire Agreement. This Amendment, the Agreement, and the other Loan Documents
constitute the entire agreement between the parties with respect to the subject matter hereof and
thereof and supersedes all prior agreements and understandings, if any, relating to the subject
matter hereof and thereof and may not be contradicted by evidence of prior, contemporaneous or
subsequent oral agreements between the parties. There are no unwritten oral agreements between the
parties.
16. Miscellaneous. Whenever the context and construction so require, all words used
in the singular number herein shall be deemed to have been used in the plural, and vice versa, and
the masculine gender shall include the feminine and neuter and the neuter shall include the
masculine and feminine. This Amendment shall inure to the benefit of Lender, all future holders of
any Note, any of the Obligations or any of the Collateral and all Transferees, and each of their
respective successors and permitted assigns. No Borrower may assign, delegate or transfer this
Amendment or any of its rights or obligations under this Amendment without the prior written
consent of Lender. No rights are intended to be created under this Amendment for the benefit of
any third party donee, creditor or incidental beneficiary of Borrower or any Guarantor. Nothing
contained in this Amendment shall be construed as a delegation to Lender of any Borrower’s or any
Guarantor’s duty of performance, including, without limitation, any duties under any account or
contract in which Lender has a security interest or Lien. This Amendment shall be binding upon
Borrowers and their respective successors and assigns.
[intentionally left blank — signature page follows]
Exhibit 10.9
[signature page to Third Amendment]
IN WITNESS WHEREOF, Lender and Borrower have executed this Third Amendment as of the date
first above written.
LENDER:
| CAPITALSOURCE FINANCE LLC |
||||
| By: | Xxxxxxx X. Xxxxxx | |||
| Name: | Xxxxxxx X. Xxxxxx | |||
| Title: | Director — Healthcare & Specialty Finance | |||
BORROWER:
| UNITED STATES PHARMACEUTICAL GROUP, L.L.C. d/b/a NATIONSHEALTH |
||||
| By: | Xxxxxxx Xxxxxxxxx | |||
| Name: | Xxxxxxx Xxxxxxxxx | |||
| Title: | CFO | |||
| NATIONSHEALTH HOLDINGS, L.L.C. |
||||
| By: | Xxxxxxx Xxxxxxxxx | |||
| Name: | Xxxxxxx Xxxxxxxxx | |||
| Title: | CFO | |||
| NATIONSHEALTH, INC. |
||||
| By: | Xxxxxxx Xxxxxxxxx | |||
| Name: | Xxxxxxx Xxxxxxxxx | |||
| Title: | CFO | |||
