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EXHIBIT 4.5
THIRD AMENDMENT TO
AMENDED TO RESTATED LOAN AND SECURITY AGREEMENT
THIS THIRD AMENDMENT TO AMENDED AND RESTATED LOAN AND SECURITY
AGREEMENT (the "Amendment") dated as of April 14, 2000, is between FIRST
HORIZON PHARMACEUTICAL CORPORATION, formerly known as Horizon Pharmaceutical
Corporation (the "Borrower") and LASALLE BANK NATIONAL ASSOCIATION, a national
banking association ("Bank").
RECITALS:
WHEREAS, the Borrower and the Bank have previously entered into that
certain Amended and Restated Loan and Security Agreement, dated December 22,
1998, as amended by that certain First Amendment to Amended and Restated Loan
and Security Agreement dated as of May 10, 1999, and as amended by that certain
Second Amendment to Amended and Restated Loan and Security Agreement dated as
of January 6, 2000 (the "Agreement"); and
WHEREAS, the Borrower requests, and the Bank is agreeable to provide a
new Bridge Loan in the amount of $13,000,000, to extend the maturity date of
the Revolving Loan, and to make such additional modifications as set forth
herein.
NOW, THEREFORE, in consideration of the premises and of the mutual
agreements hereinafter set forth, it is agreed by the parties hereto as
follows:
RECITALS. The Recitals set forth above are hereby incorporated
herein and made a part hereof.
DEFINITIONS. All capitalized terms used herein without
definition shall have the respective meanings set forth in the Agreement.
AMENDMENTS TO THE AGREEMENT.
Fixed Charge Coverage Ratio. The definition of
Fixed Charge Coverage Ratio set forth in Section 1.1 of the Agreement is hereby
amended as restated in its entirety as follows:
" 'Fixed Charge Coverage Ratio' shall mean the ratio
of EBITDA less unfunded capital expenditures for the period
measured to scheduled principal and interest payments for the
period measured."
Loan. The definition of Loans set forth in Section
1.1 of the Agreement is hereby amended and restated in its entirety as follows:
" 'Loans' shall mean, collectively, all Revolving
Loans, Term Loans and the Bridge Loan made by the Bank to the
Borrower and all Letters of Credit
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issued by the Bank for the benefit of Borrower under and
pursuant to this Agreement.
Revolving Loan Maturity Date. The definition of
Revolving Loan Maturity Date set forth in Section 1.1 of the Agreement is
hereby amended and restated in its entirety as follows:
" 'Revolving Loan Maturity Date' shall mean May 2,
2001, unless extended by the Bank pursuant to any
modification, extension or renewal note executed by the
Borrower and accepted by the Bank in its sole and absolute
discretion in substitution for the Revolving Note."
Term Loan Maturity Date. The definition of Term
Loan Maturity Date set forth in Section 1.1 of the Agreement is hereby amended
and restated in its entirety as follows:
" 'Term Loan Maturity Date' shall mean May 2, 2001,
unless extended by the Bank pursuant to any modification,
extension or renewal note executed by the Borrower and
accepted by the Bank in its sole and absolute discretion in
substitution for the Term Note."
The following definitions are hereby added to
Section 1.1 of the Agreement:
"Bridge Interest Rate" shall mean the Borrower's
option of (i) the Prime Rate per annum, or (ii) LIBOR plus
150 basis points, except that if the Bridge Loan is not
repaid in full within six months from the date hereof, the
LIBOR interest rate will increase by an additional 50 basis
points.
"Bridge Loan" shall mean the Loan made by Bank to
the Borrower in the form of a Bridge Loan under and pursuant
to this Agreement, as set for in Section 2.6 of this
Agreement.
"Bridge Loan Commitment" shall mean Thirteen Million
and 00/100 Dollars ($13,000,000.00).
"Bridge Loan Maturity Date" shall mean the earlier
of a Public Offering or one year from the date hereof.
"Bridge Note" shall mean the note, the form of which
is attached hereto as Exhibit C.
"Public Offering" shall mean any offering of debt
issued by or securities of the Borrower offered pursuant to
registration thereof under the Securities Act of 1993 and the
Securities Exchange Act of 1934.
Bridge Loan. The following is hereby added to the
Agreement:
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2.6 Bridge Loan.
1) Bridge Loan Commitment. Subject to the terms and
conditions of this Agreement and the other Loan Documents,
and in reliance upon the representations and warranties of
the Borrower set forth herein and in the other Loan
Documents, the Bank agrees to make a Bridge Loan in the
amount of the Bridge Loan Commitment. Up to $9,500,000 of the
proceeds of the Bridge Loan shall be used solely by Borrower
to purchase rights to and know how to manufacture the drug
"Ponstel" from Xxxxxx-Xxxxxxx and Xxxxx Xxxxx & Company and
up to $3,500,000 of the proceeds of the Bridge Loan shall be
used solely by Borrower to purchase rights to and know how to
manufacture the drug "Cognex" from Xxxxxx-Xxxxxxx and Xxxxx
Xxxxx & Company. The Bridge Loan may be prepaid in whole or
in part at any time without penalty, but shall be due in full
on the Bridge Loan Maturity Date, unless the credit extended
under the Bridge Loan is otherwise terminated or extended as
provided in this Agreement.
2) Term Loan Interest and Payments. Except as
otherwise provided in this Section 2.2(b), the principal
amount of the Bridge Loan outstanding from time to time shall
bear interest at the Bridge Interest Rate. Accrued and unpaid
interest on that portion of the unpaid principal balance of
the Bridge Loan outstanding from time to time which is a
Prime Loan, shall be due and payable monthly, in arrears,
commencing May 1, 2000 and continuing on the first day of
each calendar month thereafter, and on the Bridge Loan
Maturity Date. Accrued and unpaid interest on that portion of
the unpaid principal balance of the Bridge Loan outstanding
from time to time which is a LIBOR Loan shall be payable on
(i) first day of each calendar month, (ii) on the date of any
principal repayment of a LIBOR Loan, and (iii) on the Bridge
Loan Maturity Date. Any amount of principal or interest on
the Bridge Loan which is not paid when due, whether at stated
maturity, by acceleration or otherwise, shall bear interest
payable on demand at the Default Rate.
3) Mandatory Prepayment. If the Borrower completes
a Public Offering, all of the proceeds, after deducting
therefrom the expenses of the Public Offering, shall be used
by Borrower to immediately prepay the Bridge Loan. If the
Borrower does not complete a Public Offering within six
months from the date hereof, or if the Public Offering is not
sufficient to repay the Bridge Loan, Borrower shall commence
making monthly principal payments of $150,000 on October 30,
2000 and continuing on the last day of each month thereafter
through the Term Maturity Date.
4) Voluntary Prepayments. If the Borrower makes any
voluntary principal prepayment to Bank (except for principal
payments which may be required to be paid under the Revolving
Loan), such principal payments shall be applied first to
principal due on the Bridge Note. Thereafter, any voluntary
prepayments may be applied in such order as Borrower directs.
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Net Worth plus Subordinated Debt. Section 10.1
of the Agreement is hereby amended to delete the reference to
the amount of "Three Million Three Hundred Thousand Dollars
($3,300,000.00) and to insert a reference to the amount of
"Three Million Three Hundred Thousand Dollars
($3,300,000.00), plus 75% of net income earned in each fiscal
year subsequent to the fiscal year ending December 31, 1999".
Leverage. Section 10.2 of the Agreement is hereby
amended and restated as follows:
Until the net proceeds of a Public Offering are delivered to
Bank, as of the end of each of its fiscal quarters, the Borrower shall
maintain a ratio of Liabilities to Net Worth plus Subordinated Debt
according to the following schedule:
Quarter Ended Maximum Leverage
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March 31, 2000 3:50:1:00
June 30, 2000 7.00:1.00
September 30, 2000 6.50:1.00
December 31, 2000 5.50:1.00
Immediately after the proceeds of a Public Offering are
delivered to Bank, the Borrower shall maintain a ratio of Liabilities
to Net Worth of not greater than 2.25 to 1.00.
EBITDA. Section 10.3 of the Agreement is amended
and restated as follows:
As of the end of its fiscal quarters, the Borrower
shall maintain a minimum EBITDA according to the following
schedule:
Quarter Ended Minimum EBITDA
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March 31, 2000 $ 100,000
June 30, 2000 $ 800,000
September 30, 2000 $2,000,000
December 31, 2000 and thereafter $3,800,000
Fixed Charge Coverage Ratio. Section 10.4 of
the Agreement is amended and restated as follows:
As of the end of each of its fiscal quarters for the
trailing twelve month period then ending, the Borrower shall
maintain a Fixed Charge Coverage Ratio according to the
following schedule:
Quarter Ended Minimum Ratio
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March 31, 2000 .75:1:00
June 30, 2000 .75:1.00
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September 30, 2000 .90:1.00
December 31, 2000 and thereafter 1.25:1.00
The following is hereby added as Section 11.13 of
the Agreement:
11.13 Breach of Security Agreement.a default
under the terms of that certain Security Agreement
of even date herewith between ____________, as
Trustee ("Pledgor") and the Bank wherein "Pledgor"
grants a security interest to Bank in that certain
Investment Account Number 0000000 at Northern Trust
Company, which default is not cured within five (5)
days after written notice thereof from the Bank to
Pledgor.
WARRANTIES. To induce the Bank to enter into this Amendment,
the Borrower warrants that:
Authorization. The Borrower is duly authorized to
execute and deliver this Amendment and is and will continue
to be duly authorized to borrow monies under the Agreement,
as amended hereby, and to perform its obligations under the
Agreement, as amended hereby.
No Conflicts. The execution and delivery of this
Amendment and the performance by the Borrower of its
obligations under the Agreement, as amended hereby, do not
and will not conflict with any provision of law or of the
charter or by-laws of the Borrower or of any agreement
binding upon the Borrower.
Validity and Binding Effect. The Agreement, as
amended hereby, is a legal, valid and binding obligation of
the Borrower, enforceable against the Borrower in accordance
with its terms, except as enforceability may be limited by
bankruptcy, insolvency or other similar laws of general
application affecting the enforcement of creditors' rights or
by general principles of equity limiting the availability of
equitable remedies.
No Default. As of the closing date hereof, no
Event of Default under Section 11 of the Agreement, as
amended by this Amendment, or event or condition which, with
the giving of notice or the passage of time, shall constitute
an Event of Default, has occurred or is continuing.
Warranties. As of the closing date hereof, the
representations and warranties in Section 7 of the Agreement
are true and correct as though made on such date, except for
such changes as are specifically permitted under the
Agreement.
CONDITIONS PRECEDENT TO INITIAL $9,500,000 ADVANCE UNDER THE
BRIDGE NOTE. This Amendment shall become effective as of the date above first
written
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and the Bank shall advance to Borrower the amount of $9,500,000 under the
Bridge Note after receipt by the Bank of the following:
5) a fully executed Amendment;
6) an executed Revolving Note of the Borrower payable to the Bank
in the form attached hereto as Exhibit A;
7) an executed Term Note of the Borrower payable to the Bank in
the form attached hereto as Exhibit B;
8) an executed Bridge Note of the Borrower payable to the Bank
in the form attached hereto as Exhibit C;
9) Secretary's certificate relating to corporate resolutions
authorizing the Amendment and the $13,000,000 Bridge Note;
10) a Security Agreement in the form attached hereto as Exhibit D
executed by Pledgor, pledging her interest in an investment account at
Northern Trust Company to secure the Bridge Loan;
11) a Custodial Account Control Agreement among Xxxxxx Xxxxxx,
Northern Trust Company and LaSalle Bank National Association;
12) an opinion of counsel for Pledgor in form and substance
satisfactory to Bank;
13) an executed copy of the Purchase Agreement wherein Borrower
agrees to purchase "Ponstel";
14) a consent from Xxxxxx Xxxxxxx to the transfer of Ponstel as
contemplated by this Amendment and Intellectual Property Security
Agreement;
15) a copy of the Xxxx of Sale from Xxxxxx Xxxxxxx;
16) a copy of the Xxxxxx Xxxxxxx Assignment letters to the Food
and Drug Administration;
17) an Intellectual Property Security Agreement for Ponstel;
18) a UCC-1 Financing Statement relating to the Intellectual
Property Security Agreement for "Ponstel";
19) a commitment fee in the amount of Nineteen Thousand Five
Hundred Dollars ($19,500.00);
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20) A UCC-3 financing statement reflecting the name change of
Borrower; and
21) such other documents that the Bank may reasonably require.
CONDITIONS PRECEDENT TO USE OF THE REMAINING $3,500,000 AVAILABLE
UNDER THE BRIDGE NOTE. The Bank shall advance the remaining $3,500,000
available under the Bridge Note after receipt by the Bank of the following:
22) a written request to the Bank specifying the basis upon which
the $3,500,000 payment is due to Xxxxxx-Xxxxxxx Company under the
terms of Section 2.1(a)(ii) of the Purchase Agreement referred to in
section 5(i) above;
If the reason for funding is that Borrower is purchasing
Cognex, then said funds shall be available only upon receipt by the
Bank of the following:
23) evidence satisfactory to Bank that the Federal Trade
Commission has approved the sale of Cognex to Borrower;
24) an Intellectual Property Security Agreement for Cognex;
25) a UCC-1 financing statement relating to the Intellectual
Property Security Agreement for "Cognex"; and
26) a copy of the Xxxx of Sale from Xxxxxx Xxxxxxx;
27) a copy of the Xxxxxx Xxxxxxx Assignment letters to the Food
and Drug Administration;
28) such other documents that the Bank may reasonably require.
GENERAL.
Law. This Amendment shall be construed in
accordance with and governed by the laws of the State of Illinois.
Successors. This Amendment shall be binding upon
the Borrower and the Bank and their respective successors and assigns,
and shall inure to the benefit of the Borrower and the Bank and its
successors and assigns.
Confirmation of Agreement. Except as amended
hereby, the Agreement shall remain in full force and effect and is
hereby ratified and confirmed in all respects.
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IN WITNESS WHEREOF, the parties hereto have executed
this Amendment as of the date first above written.
First Horizon Pharmaceutical
Corporation
By:
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Print Name:
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Title:
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LaSalle Bank National Association
By:
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Print Name:
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Title:
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