Exhibit 4.4(ii)
FIRST AMENDMENT
TO
CREDIT AGREEMENT
This FIRST AMENDMENT TO CREDIT AGREEMENT (this "Amendment") is dated as
of December 4, 1998 and is by and among GLOBAL HEALTH SUB, INC., as Borrower,
GLOBAL HEALTH SCIENCES, INC., as Parent Guarantor, the LENDERS party hereto,
CITICORP USA, INC., as Administrative Agent, CITIBANK, N.A., as Issuing Bank,
and BANK OF AMERICA NT&SA, as Documentation Agent.
RECITALS
1. The parties hereto have previously entered into that certain Credit
Agreement dated as of April 23, 1998 (the "Credit Agreement").
2. The Borrower has requested that the Lenders (i) consent to the
consummation of certain Acquisitions that do not constitute Permitted
Acquisitions, and (ii) increase the aggregate amount of the Revolving
Commitments available under the Credit Agreement from $50,000,000 to
$75,000,000, and the Lenders are willing to grant such consent and such
increase, all on the terms and conditions set forth herein.
AGREEMENT
I.
DEFINITIONS
1.1 DEFINED TERMS. Capitalized terms used but not otherwise defined
herein shall have the respective meanings assigned to such terms in the Credit
Agreement.
II.
CONSENTS AND LIMITED WAIVER
2.1 CONSENTS TO CERTAIN ACQUISITIONS. As of the First Amendment
Effective Date (as defined in Section 5.1 hereof), the Required Lenders hereby
consent to the consummation by the Borrower of two Acquisitions disclosed to the
Lenders prior to the date hereof as (i) the purchase (the "Alpha Acquisition")
by the Borrower of 100% of the capital stock of American Ingredients, Inc., a
California corporation ("Alpha"), and (ii) the purchase (the "Beta Acquisition")
by New Micelle, Inc., a wholly owned Subsidiary of the Borrower ("Newco") of
substantially all of the assets of Micelle, Inc. (formerly known as Bioglan
Laboratories, Inc.) ("Beta") (and such Acquisitions shall constitute "Permitted
Acquisitions" for all purposes of the Credit Agreement and the other Loan
Documents) so long as (a) such Acquisitions are consummated for total
Acquisition Consideration not to exceed $36,000,000, in the case of the Alpha
Acquisition, and $28,000,000 in the case of the Beta Acquisition, (b) such
Acquisitions include substantially all rights and assets, and are otherwise
consummated on the same material terms, as disclosed to the Lenders prior to the
date hereof, (c) the aggregate principal amount of all Indebtedness incurred in
connection with such Acquisitions (including any assumed Indebtedness but
excluding Borrowings under the Credit Agreement) does not exceed $706,000 and
all such Indebtedness is on terms (including amortization schedules, interest
rates, covenants and defaults) satisfactory to the Administrative Agent and the
Required Lenders, (d) Alpha and Beta shall each, prior to the consummation of
the Acquisition of such Person, have entered into arms-length leases with
respect to all real property necessary to the operation of its business on terms
and conditions satisfactory to the Administrative Agent and the Required Lenders
and shall have obtained landlord waivers in form and substance satisfactory to
the Administrative Agent from each lessor under each such lease, and (e) all
conditions to a Permitted Acquisition under the Credit Agreement and the other
Loan Documents are complied with with respect to each such Acquisition
(including, without limitation, Section 5.12 of the Credit Agreement) except
that (1) notwithstanding clause (j) of the definition of "Permitted Acquisition"
set forth in the Credit Agreement, consummation of each such Acquisition may
utilize or require aggregate proceeds of Revolving Loans and Letters of Credit
in excess of $20,000,000 if such Loans and Letters of Credit are otherwise
permitted under the Credit Agreement PROVIDED THAT after giving effect to the
consummation of the Alpha Acquisition and the Beta Acquisition and the Revolving
Loans made to effect such consummation the aggregate Total Exposure of the
Lenders shall not exceed $55,000,000 (subject to increases resulting from
Revolving Loans made, and Letters of Credit issued, after such consummation in
accordance with the terms of the Credit Agreement as amended hereby), (2) clause
(i) of the definition of "Permitted Acquisition" set forth in the Credit
Agreement shall not be applicable to the Alpha Acquisition, and (3) clause (l)
of the definition of "Permitted Acquisition" set forth in the Credit Agreement
(as amended by this Amendment) shall not be applicable to the Alpha Acquisition
or the Beta Acquisition. For the avoidance of doubt, it is understood and agreed
that the Alpha Acquisition and the Beta Acquisition need not close
simultaneously and that the consummation of the Alpha Acquisition is not
conditioned upon the consummation of the Beta Acquisition.
2.2 LIMITED WAIVER OF COMPLIANCE WITH SECTION 5.1(C). As of the First
Amendment Effective Date, the Required Lenders hereby waive compliance by
Holdings and its Subsidiaries with the provisions of Section 5.1(c) of the
Credit Agreement to the extent, and only to the extent, that Holdings and its
Subsidiaries failed, prior to the date hereof, to comply with such provisions
with respect to fiscal months of Holdings ending prior to December 31, 1998. It
is understood and agreed that full compliance with the provisions of Section
5.1(c) of the Credit Agreement shall be required with respect to each fiscal
month of Holdings and its Subsidiaries ending on and after December 31, 1998.
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III.
AMENDMENTS
3.1 AMENDMENTS TO CREDIT AGREEMENT; SCHEDULES; EXHIBITS. As of the
First Amendment Effective Date, the Credit Agreement shall be amended as
follows:
3.1.1 SECTION 1.1. Section 1.1 of the Credit Agreement is hereby
amended by:
(a) adding thereto, in appropriate alphabetical order, the
following definition:
"PRE-ACQUISITION UNAUDITED EBITDA" means, with respect to any
assets or Persons acquired in a Permitted Acquisition, EBITDA
attributable to such assets or Persons for any period ended prior to
the period in which the consummation of the related Permitted
Acquisition occurred if (i) the related financial statements with
respect to such assets or Person were unaudited prior to the
consummation of such Permitted Acquisition, and (ii) the financial
statements with respect to such assets or Person for all such prior
periods included in any applicable calculation period have not
subsequently been audited in a manner satisfactory to the
Administrative Agent and the Required Lenders. "
(b) deleting the final parenthetical of the definition of
"REVOLVING COMMITMENT" and substituting the following therefor: "(and the
aggregate amount of the Lenders' Revolving Commitments is $75,000,000)";
(c) amending the definitions of the terms "Cash Interest
Coverage Ratio" and "Fixed Charge Coverage Ratio" by adding to the end of each
such definition the following: "For purposes of the foregoing, the phrase "cash
portion of Consolidated Interest Expense" for any period shall mean all amounts
of Consolidated Interest Expense paid in cash during such period and all amounts
of Consolidated Interest Expense accrued during such period and payable in cash
in any subsequent period.";
(d) amending the definition of "EBITDA" by adding to the end
of such definition the following: "Any contrary provision hereof
notwithstanding, for purposes of determining compliance with Sections 6.13
through 6.14 hereof, the aggregate amount of Pre-Acquisition Unaudited EBITDA
for any calculation period which may be included in the calculation of
Consolidated EBITDA for such period may not exceed 20% of such Consolidated
EBITDA.;
(e) amending the definition of "PRO FORMA LEVERAGE RATIO" by
adding to the end thereof the following: "; PROVIDED, HOWEVER, that any contrary
provision hereof notwithstanding, for purposes of determining compliance with
Section 6.12 hereof, the aggregate amount of Pre-Acquisition Unaudited EBITDA
for any calculation period which may be included in the calculation of Pro Forma
Operating Cash Flow of Holdings, the Borrower and the Borrower Subsidiaries for
such period may not exceed 20% of such Pro Forma Operating Cash Flow;
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(f) amending and restating in its entirety the defined term
"Required Lenders" to read as follows:
"`REQUIRED LENDERS' means, (i) at all times prior to the
Revision Date (as defined below), Lenders having Total Exposures and
unused Revolving Commitments representing at least 66.67% of the sum of
the Total Exposures and unused Revolving Commitments at such time;
PROVIDED, HOWEVER, that at all such times prior to the Revision Date,
for purposes of any amendment, modification, waiver or consent with
respect to Sections 5.1 through 5.10, 5.12, 5.13, 5.15 and 5.16 hereof,
"Required Lenders" shall mean Lenders having Total Exposures and unused
Revolving Commitments representing more than 50% of the sum of the
Total Exposures and unused Revolving Commitments at such time, and (ii)
at all times on or after the Revision Date, Lenders having Total
Exposures and unused Revolving Commitments representing more than 50%
of the sum of the Total Exposures and unused Revolving Commitments at
such time. For purposes of this definition, the term "REVISION DATE"
shall mean the first date on or after delivery to the Administrative
Agent of the financial statements and Compliance Certificate required
under Section 5.1 with respect to the fiscal year of the Borrower
ending December 31, 2000 as of which the Borrower has certified to the
Administrative Agent that (1) the Borrower is in compliance with all
terms and conditions of this Agreement, and (2) the Supply Agreements
(or any successor agreement or agreements) have been renewed through at
least December 31, 2003 on substantially the same terms as in effect on
the date of this Agreement (and in no event in any manner materially
less favorable to the Borrower)."; and
(g) amending the definition of "PERMITTED ACQUISITIONS" by (i)
deleting the word "and" appearing at the end of clause (j) of such
definition, (ii) adding the word "and" at the end of clause (k) of such
definition, and (iii) adding a new clause (l) to read as follows:
"(l) Holdings' EBITDA Coverage Ratio (as defined in the Senior
Note Indenture) is at least 2.25 to 1 as provided in Section 4.06(d) of
the Senior Note Indenture after giving effect to such Acquisition and
all Indebtedness (including Loans hereunder) incurred in connection
therewith."
3.1.2 SECTION 3.2(b). Section 3.2(b) of the Credit Agreement
is hereby deleted in its entirety and the following substituted
therefor:
"(b) At the time of and immediately after giving effect to
such Borrowing or the issuance, amendment, renewal or extension of such
Letter of Credit, as applicable, unless the Required Lenders shall
otherwise agree, (i) no Default shall have occurred and be continuing,
(ii) no Default or Event of Default under (and as defined in) the
Senior Note Indenture exists and (iii) if, either before or immediately
after giving effect to such Borrowing, issuance, amendment, renewal or
extension, the sum of the aggregate outstanding principal amount of
Revolving Loans PLUS the aggregate LC Exposure
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exceeds $60,000,000, Holdings' EBITDA Coverage Ratio (as defined in the
Senior Note Indenture) is at least 2.0 to 1 as provided in Section
4.06(d) of the Senior Note Indenture. In addition, unless the Required
Lenders otherwise agree, at any time that, either before or immediately
after giving effect to such Borrowing, issuance, amendment, renewal or
extension both (i) the sum of the aggregate outstanding principal
amount of Revolving Loans PLUS the aggregate LC Exposure exceeds
$60,000,000, and (ii) Holdings' EBITDA Coverage Ratio (as defined in
the Senior Note Indenture) would be less than 2.50 to 1, the Borrower
shall deliver to the Administrative Agent, prior to the date of such
Borrowing, issuance, amendment, renewal or extension, a certificate of
the chief financial officer of the Borrower demonstrating and
certifying as to compliance with this section 3.2(b) and setting forth
in reasonable detail the calculation of Holdings' EBITDA Coverage Ratio
both before and immediately after giving effect to such Borrowing,
issuance, amendment, renewal or extension."
3.1.3 SECTION 5.1(C). Section 5.1(c) of the Credit
Agreement is hereby amended and restated in its entirety to read as
follows:
"(c) commencing with December 31, 1998, within 30
days after the end of each fiscal month (and in each case as of the end
of each fiscal month for such fiscal month and the then elapsed portion
of the fiscal year of Holdings), (i) a consolidated balance sheet and
related statements of operations, stockholders' equity and cash flows
for Holdings and (ii) a combining statement of operations for each
Borrower Subsidiary and Holdings, all certified by one of Holdings'
Financial Officers as presenting in all material respects the financial
condition and results of operations of Holdings and the Borrower
Subsidiaries on a consolidated or combined basis (as applicable) in
accordance with GAAP consistently applied, subject to normal year-end
audit adjustments and the absence of footnotes;"
3.1.4 SECTION 6.1. Section 6.1 of the Credit
Agreement is hereby amended by adding thereto a new Section 6.1(c) to
read as follows:
"(c) Any provision hereof to the contrary
notwithstanding, unless the Required Lenders shall otherwise agree,
each of Holdings and the Borrower will not, and will not permit any
Subsidiary to, create, incur, assume or permit to exist any
Indebtedness (as defined in the Senior Note Indenture) in reliance on
the provisions of Section 4.06(j) of the Senior Note Indenture except
for Indebtedness in an aggregate principal amount not to exceed
$706,000 incurred in connection with the consummation of the
Acquisition of the assets of Micelle, Inc."
3.1.5 SCHEDULE 2.1. Schedule 2.1 to the Credit
Agreement is hereby deleted in its entirety and replaced for all
purposes of the Credit Agreement and the other Loan Documents with
Schedule 2.1 attached hereto.
3.1.6 EXHIBIT B. Exhibit B to the Credit Agreement is
hereby amended by (a) deleting the word "and" appearing at the end of
paragraph (C), (b) deleting
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the period at the end of paragraph (D) and substituting therefore ";
and" and (c) adding the following immediately following paragraph D:
"(E) at the time of and immediately after giving
effect to such Borrowing, (i) no Default or Event of Default under (and
as defined in) the Senior Note Indenture exists and (ii) if, either
before or immediately after giving effect to such Borrowing, the sum of
the aggregate outstanding principal amount of Revolving Loans PLUS the
aggregate LC Exposure exceeds $60,000,000, Holdings' EBITDA Coverage
Ratio (as defined in the Senior Note Indenture) is at least 2.0 to 1 as
provided in Section 4.06(d) of the Senior Note Indenture."
IV.
REPRESENTATIONS AND WARRANTIES
4.1 REPRESENTATIONS AND WARRANTIES. Each of the Borrower and
the Parent Guarantor hereby represents and warrants to the Administrative Agent,
the Lenders and the Issuing Bank as follows:
4.1.1. Such party is duly organized, validly existing
and in good standing under the laws of the jurisdiction of its
incorporation, with full power and authority to carry on its business
as now conducted and to enter into and perform its obligations under
this Amendment (and the Credit Agreement as amended hereby) and, except
where the failure to do so, individually or in the aggregate, could not
reasonably be expected to result in a Material Adverse Effect, is
qualified to do business in, and is in good standing in, every
jurisdiction where such qualification is required.
4.1.2 Such party has taken all necessary action to
authorize the execution, delivery and performance of this Amendment
(and the Credit Agreement as amended hereby).
4.1.3. This Amendment has been duly executed and
delivered by such party and each of this Amendment and the Credit
Agreement as amended hereby constitutes the legal, valid and binding
obligation of such party, enforceable against such party in accordance
with its terms, except as enforceability may be limited by bankruptcy,
insolvency, reorganization, moratorium or other similar laws affecting
creditors' rights generally and by general principles of equity
(regardless of whether enforcement is sought in a proceeding at law or
in equity).
4.1.4 Before and after giving effect to this
Amendment, no event has occurred and is continuing, or would result
from the execution and delivery of this Amendment that would constitute
a Default.
4.1.5 Each of the representations and warranties
contained in this Amendment and the Credit Agreement as amended hereby
is true, correct and complete as if set forth in full herein and made
on the date this Amendment becomes effective,
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except to the extent that any such representation and warranty
specifically relates to an earlier date, in which case it was true,
correct and complete as of such earlier date.
4.1.6 All conditions to the consummation of the Alpha
Acquisition, other than the funding of the purchase price, shall have
been satisfied and arrangements satisfactory to the Administrative
Agent shall have been made for the funding of the purchase price
concurrently with the effectiveness of this Amendment.
V.
CONDITIONS TO EFFECTIVENESS
5.1 CONDITIONS TO EFFECTIVENESS. The consents, waivers and
amendments effected by this Amendment shall not become effective until the date
(the "First Amendment Effective Date"), not later than December 15, 1998, on
which the following conditions precedent are satisfied or waived in writing by
the Required Lenders:
5.1.1 EXECUTION OF THIS AGREEMENT; REVOLVING NOTES.
Parent Guarantor, the Borrower, the Administrative Agent, the Issuing
Bank and each Lender shall have executed and delivered this Amendment
to the Administrative Agent and each other Guarantor shall have
executed and delivered the Consent attached hereto to the
Administrative Agent. The Borrower shall have executed and delivered to
the Administrative Agent a new Revolving Note in favor of any Lender
requesting the same.
5.1.2 OPINION OF COUNSEL TO BORROWER, HOLDINGS AND
EACH BORROWER SUBSIDIARY. The Administrative Agent shall have received
a favorable written opinion (addressed to the Administrative Agent, the
Issuing Bank and the Lenders) of Weil, Gotshal & Xxxxxx LLP, counsel
for the Loan Parties, covering such matters relating to the Loan
Parties and the Amendment as the Administrative Agent or the Required
Lenders shall reasonably request. The Borrower and Holdings hereby
request such counsel to deliver such opinions.
5.1.3. ORGANIZATIONAL DOCUMENTS. The Administrative
Agent shall have received such documents and certificates as the
Administrative Agent or its counsel may reasonably request relating to
the organization, existence and good standing of each Loan Party, the
authorization of this Amendment and any other legal matters relating to
the Loan Parties and this Amendment, all in form and substance
satisfactory to the Administrative Agent and its counsel.
5.1.4 OFFICER'S CERTIFICATE. The Administrative Agent
shall have received a certificate dated the First Amendment Effective
Date and signed by the President, a Vice President or a Financial
Officer of the Borrower, confirming compliance with the conditions set
forth in this Article V and that each of the representations and
warranties of the Borrower and Holdings contained in this Amendment are
true and correct on and as of the date hereof (except to the extent
that any
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such representation and warranty is limited by its terms to an earlier
date, in which case such representation and warranty was true and
correct as of such earlier date).
5.1.5 PAYMENT OF FEES. The Administrative Agent shall
have received all fees and other amounts due and payable on or prior to
the date hereof, including, to the extent invoiced, reimbursement or
payment of all expenses required to be reimbursed or paid by any Loan
Party hereunder or under the Credit Agreement.
5.1.6. REPRESENTATIONS AND WARRANTIES. All
representations and warranties contained in this Amendment and the
Credit Agreement as amended hereby shall be true, correct and complete
as if made on the date this Amendment becomes effective, except to the
extent that such representations and warranties specifically relate to
an earlier date, in which case they are true, correct and complete as
of such earlier date.
VI.
MISCELLANEOUS
6.1 NO WAIVER. Except as expressly set forth herein, nothing
contained herein or in any other instrument or document executed in connection
herewith, nor any action taken by the Administrative Agent, the Issuing Bank or
any Lender , or any party hereto or any party consenting hereto in connection
with this Amendment or any other action contemplated hereby or thereby shall in
any event be construed or deemed to constitute a waiver of any past, present or
future Default or Event of Default, or a waiver or an estoppel of any cause of
action the Administrative Agent, the Issuing Bank or any Lender, or any party
hereto or any party consenting hereto may have against any other party for any
reason whatsoever.
6.2 FULL FORCE AND EFFECT. As of the First Amendment Effective
Date, the Credit Agreement shall be amended to the extent set forth in Section 3
hereof. Except as specifically amended by this Amendment, all of the terms and
provisions of the Credit Agreement or any of the documents referred to therein
or defined in connection therewith shall remain in full force and effect. Such
amendments shall be limited precisely as written and shall not be deemed (a)
except as expressly set forth herein, to be a consent to any modification or
waiver of other terms or conditions of the Credit Agreement or any of the
documents referred to therein or delivered in connection therewith or (b) to
prejudice any right, remedy, power or privilege which any party hereto or any
party consenting hereto now has or may have in the future under or in connection
with the Credit Agreement or any of the documents referred to therein or
delivered in connection therewith. The term "Agreement" as used in the Credit
Agreement, the other Loan Documents and all other related documents shall mean
the Credit Agreement as amended hereby.
6.3 EXPENSES. Without limiting any provision of the Amendment
or Section 9.3 of the Credit Agreement, each of the Borrower and Holdings
jointly and severally agrees to pay promptly all reasonable costs and expenses
of the Administrative Agent and the reasonable costs and expenses of the
Administrative Agent's legal counsel in connection with the preparation,
negotiation, execution, delivery and administration of this Amendment and the
transactions contemplated hereby.
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6.4 GOVERNING LAW. This Amendment shall be governed by and
construed in accordance with the laws of the State of New York, without regard
to conflicts of law principles. The provisions of Sections 9.9(b)-(d) 9.10 of
the Credit Agreement shall apply hereto.
6.5 SEVERABILITY. The illegality or unenforceability of any
provision of this Amendment, the Credit Agreement (including as amended hereby)
or any other document or any other instrument or agreement required hereunder or
thereunder shall not in any way affect or impair the legality or enforceability
of the remaining provisions of this Amendment, the Credit Agreement (including
as amended hereby) or such other document or any other instrument or agreement
required hereunder or thereunder.
6.6 HEADINGS. Article and Section headings used herein are for
convenience of reference only, are not part of this Amendment and shall not
affect the construction of, or be taken into consideration in interpreting, this
Amendment (or the Credit Agreement as amended hereby).
6.7 COUNTERPARTS. This Amendment may be executed by one or
more of the parties hereto in any number of separate counterparts, each of
which, when so executed shall be deemed an original, and all of said
counterparts taken together shall be deemed to constitute but one and the same
instrument.
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SCHEDULE 2.1
REVOLVING COMMITMENTS
Revolving
Lender Commitment % of Total Commitments
------ ---------- ----------------------
Citicorp USA, Inc. $19,500,000 26%
Bank of America NT&SA $16,500,000 22%
Sanwa Bank California $15,000,000 20%
Xxxxx Fargo Bank, N.A. $12,000,000 16%
Dresdner Bank AG $12,000,000 16%
------------- ------
TOTAL: $75,000,000 100.0%
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to
Credit Agreement to be duly executed and delivered by their respective officers
thereunto duly authorized as of the date first above written.
GLOBAL HEALTH SUB, INC.,
as Borrower
By:
----------------------------------------
Name:
Title:
GLOBAL HEALTH SCIENCES, INC.,
as Parent Guarantor
By:
----------------------------------------
Name:
Title:
CITICORP USA, INC.,
as Administrative Agent
By:
----------------------------------------
Name:
Title:
CITIBANK, N.A.,
as Issuing Bank
By:
----------------------------------------
Name:
Title:
S-1
BANK OF AMERICA NT&SA,
as Documentation Agent
By:
----------------------------------------
Name:
Title:
S-2
CITICORP USA, INC.,
as Lender
By:
----------------------------------------
Name:
Title:
S-3
BANK OF AMERICA NT&SA,
as Lender
By:
----------------------------------------
Name:
Title:
S-4
SANWA BANK CALIFORNIA,
as Lender
By:
----------------------------------------
Name:
Title:
S-5
XXXXX FARGO BANK, N.A.,
as Lender
By:
----------------------------------------
Name:
Title:
X-0
XXXXXXXX XXXX XX,
Xxx Xxxx and Grand Cayman Branches,
as Lender
By:
----------------------------------------
Name:
Title:
By:
----------------------------------------
Name:
Title:
S-7
CONSENT
DATED AS OF DECEMBER 4, 1998
The undersigned, as Subsidiary Guarantors under the "Guarantee
Agreement" and as Subsidiary Grantors under the "Pledge and Security Agreement"
(as such terms are defined in and under the Credit Agreement referred to in the
foregoing First Amendment), each hereby consents and agrees to the foregoing
First Amendment and hereby confirms and agrees that (i) the Guarantee Agreement
and the Pledge and Security Agreement are, and shall continue to be, in full
force and effect and are hereby ratified and confirmed in all respects except
that, upon the effectiveness of, and on and after the date of, said First
Amendment, each reference in the Guarantee Agreement and the Pledge and Security
Agreement to the "Credit Agreement", "thereunder", "thereof" and words of like
import referring to the Credit Agreement, shall mean and be a reference to the
Credit Agreement as amended by said First Amendment, and (ii) the Pledge and
Security Agreement and all of the Collateral described therein do, and shall
continue to, secure the payment of all of the Secured Obligations as defined in
the Pledge and Security Agreement.
D&F INDUSTRIES, INC.
RAVEN INDUSTRIES, INC.
DYNAMIC PRODUCTS, INC.
WEST COAST SALES
By:
----------------------------------------
Name:
Title:
S-1
