June 19, 2015
Exhibit 10.1
June 19, 2015
Diplomat Pharmacy, Inc.,
as Borrower, and the other
Credit Parties
0000 X. Xxxxxxx Xxxxxx
Xxxxx, Xxxxxxxx 00000
Attention: Xxxx Xxxxxx,
Chief Financial Officer
Facsimile: (000) 000-0000
Re: Diplomat Pharmacy, Inc. —
Consent to Acquisition of Burman’s Apothecary, L.L.C and AmerisourceBergen Lien Amendment
Ladies and Gentlemen:
Reference is made to the Second Amended and Restated Credit Agreement dated as of April 1, 2015 (as amended, the “Credit Agreement”), by and among Diplomat Pharmacy, Inc., a Michigan corporation (“Borrower”), the other Credit Parties party thereto, and General Electric Capital Corporation, a Delaware corporation, in its capacity as agent (in such capacity, “Agent”) for the several financial institutions from time to time party thereto. Capitalized terms used in this letter and not otherwise defined herein shall have the respective meanings given to them in the Credit Agreement.
Borrower has advised Agent and the Lenders that it intends to acquire 100% of the membership interests of Burman’s Apothecary, L.L.C., a Pennsylvania limited liability company (“Burman’s”) and its subsidiaries, pursuant to that certain Membership Interest Purchase Agreement (as may be amended, restated, supplemented or otherwise modified in accordance with the terms of the Credit Agreement, as defined herein, the “Burman’s Purchase Agreement”) dated as of June 19, 2015, by and among Borrower, Burman’s, Burman’s Media Pharmacy, LLC, a Pennsylvania limited liability company, PharmTrack, LLC, a Nevada limited liability company, SLB Holdings, Inc. and Xxxxxx X. Xxxxxx, Xxxx X. Xxxxxxxx, and Xxxxxxxxx Xxxxxxxx (the “Burman’s Acquisition”). The total consideration payable is $82,000,000 (as increased by pre-closing purchase price adjustments for a tax gross up to sellers (estimated at approximately $800,000) and cash on hand, and subject to a net working capital adjustment), of which $72,000,000 (subject to such adjustments) is payable in cash and $10,000,000 is payable in common Stock of Borrower.
Pursuant to the definition of “Permitted Acquisition”, the total consideration paid or payable (including without limitation, all transaction costs, Indebtedness incurred, assumed and/or reflected on a consolidated balance sheet of the Credit Parties and their Subsidiaries after giving effect to such Acquisition and the maximum amount of all deferred payments, including Contingent Acquisition Consideration for all Acquisitions consummated after the Closing Date during any Fiscal Year shall not exceed $75,000,000 in the aggregate for all such Acquisitions (the “Permitted Acquisition Fiscal Year Cap”). Borrower has informed the Agent and the Lenders that the total consideration paid or payable pursuant to the Burman’s Acquisition will
cause the total consideration paid or payable for all Acquisitions consummated after the Closing Date during the Fiscal Year ending December 31, 2015 to exceed the Permitted Acquisition Fiscal Year Cap for the Fiscal Year ending December 31, 2015.
In addition, Borrower has requested that Section 5.1(p) of the Credit Agreement with respect to Liens in favor of AmerisourceBergen be amended and restated as follows (the “AmerisourceBergen Lien Amendment”):
“(p) Liens in favor of AmerisourceBergen or any of its Affiliates that are from time to time party to the AmerisourceBergen Intercreditor Agreement (including by amendment or joinder) securing the AmerisourceBergen Indebtedness, subject to the AmerisourceBergen Intercreditor Agreement; and”
Effective as of the date hereof, upon execution of this letter agreement by the Agent, the Required Lenders and the Credit Parties and subject to the prior satisfaction of all conditions specified in the definition of “Permitted Acquisition” as set forth in the Credit Agreement, other than the Permitted Acquisition Fiscal Year Cap for the Fiscal Year ending December 31, 2015, in reliance upon the representations and warranties of the Credit Parties set forth in the Credit Agreement and notwithstanding any provisions in the Credit Agreement to the contrary, the Agent and the Lenders party hereto hereby (i) waive compliance with the Permitted Acquisition Fiscal Year Cap for the Fiscal Year ending December 31, 2015 solely with respect to the Burman’s Acquisition and (ii) consent to and approve the AmerisourceBergen Lien Amendment and authorize the Agent, on behalf of the Required Lenders, if it deems appropriate, to execute an amendment to further memorialize such AmerisourceBergen Lien Amendment. In addition, Credit Parties hereby acknowledge and agree that upon consummation of the Burman’s Acquisition, no further Permitted Acquisitions may occur in the current Fiscal Year without first obtaining the prior written consent of the Agent and Required Lenders, and that the aggregate consideration paid in respect of the Burman’s Acquisition will reduce dollar-for-dollar the aggregate amount available during the remainder of the term of the Credit Agreement.
Except to the extent specifically set forth herein, this letter shall not constitute an amendment or waiver by Agent or any Lender of any provisions of the Credit Agreement or any other Loan Document, and all of the provisions of the Credit Agreement and the other Loan Documents shall remain in full force and effect to the extent in effect prior to the date hereof. This letter may be executed in any number of several counterparts, each of which shall be an original, but all of which shall constitute one and the same letter agreement. Delivery of an executed counterpart of a signature page to this letter by facsimile transmission shall be effective as delivery of a manually executed counterpart thereof. This letter shall be governed by, and construed and enforced in accordance with, the laws of the State of New York applicable to contracts made and performed in such state, without regard to the principles thereof regarding conflict of laws.
[signature pages follow]
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GENERAL ELECTRIC CAPITAL CORPORATION, as Agent, Swingline Lender and as a Lender | |
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By: |
/s/ Xxxxx X. Xxxxxxxxx |
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Name: |
Xxxxx X. Xxxxxxxxx |
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Title: |
Duly Authorized Signatory |
Signature Page to Consent Letter — June 2015
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GE CAPITAL BANK, | |
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as a Lender | |
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By: |
/s/ Xxxx Xxxxx |
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Name: |
Xxxx Xxxxx |
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Title: |
Duly Authorized Signatory |
Signature Page to Consent Letter — June 2015
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COMERICA BANK, | |
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as a Lender | |
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By: |
/s/ Xxxxxxx X. Xxxxx |
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Name: |
Xxxxxxx X. Xxxxx |
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Title: |
Vice President |
Signature Page to Consent Letter — June 2015
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JPMORGAN CHASE BANK, N.A., | |
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as a Lender | |
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By: |
/s/ Xxxxxxx X. Xxxxxxxxx |
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Name: |
Xxxxxxx X. Xxxxxxxxx |
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Title: |
Authorized Signatory |
Signature Page to Consent Letter — June 2015
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XXXXX FARGO BANK, N.A., | |
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as a Lender | |
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By: |
/s/ Xxxxx Xxxxxxx |
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Name: |
Xxxxx Xxxxxxx |
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Title: |
Duly Authorize Signatory |
Signature Page to Consent Letter — June 2015
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BANK OF AMERICA, N.A., | |
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as a Lender | |
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By: |
/s/ Xxxx Xxxx |
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Name: |
Xxxx Xxxx |
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Title: |
Senior Vice President |
Signature Page to Consent Letter — June 2015
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CAPITAL ONE, N.A., | |
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as a Lender | |
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By: |
/s/ Xxxxxx X. Xxxxxxx |
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Name: |
Xxxxxx X. Xxxxxxx |
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Title: |
Vice President |
Signature Page to Consent Letter — June 2015
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CREDIT SUISSE AG, CAYMAN ISLANDS BRANCH, as a Lender | |
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By: |
/s/ Xxxxxxxx Xxxxx |
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Name: |
Xxxxxxxx Xxxxx |
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Title: |
Authorized Signatory |
Signature Page to Consent Letter — June 2015
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FIFTH THIRD BANK, | |
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as a Lender | |
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By: |
/s/ Xxxxxxxxx X. Xxxx |
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Name: |
Xxxxxxxxx X. Xxxx |
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Title: |
Vice President |
Signature Page to Consent Letter — June 2015
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FIRSTMERIT BANK, N.A., | |
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as a Lender | |
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By: |
/s/ Xxxx Xxxxx |
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Name: |
Xxxx Xxxxx |
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Title: |
Vice President |
Signature Page to Consent Letter — June 2015
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FLAGSTAR BANK, FSB, | |
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as a Lender | |
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By: |
/s/ Xxxxxxxxx X. Xxxxxxx |
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Name: |
Xxxxxxxxx X. Xxxxxxx |
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Title: |
First Vice President |
Signature Page to Consent Letter — June 2015
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THE HUNTINGTON NATIONAL BANK, | |
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as a Lender | |
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By: |
/s/ Xxxxxxx X. Xxxxx |
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Name: |
Xxxxxxx X. Xxxxx |
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Title: |
Senior Vice President |
Signature Page to Consent Letter — June 2015
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TALMER BANK AND TRUST, | |
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as a Lender | |
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By: |
/s/ Xxxxx Xxxxxxx |
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Name: |
Xxxxx Xxxxxxx |
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Title: |
Managing Director |
Signature Page to Consent Letter — June 2015
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ACKNOWLEDGED AND AGREED: |
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By: |
/s/ Xxxxxx X. Xxxxxxxx |
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Name: Xxxxxx X. Xxxxxxxx |
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Title: Chief Executive Officer |
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DIPLOMAT HEALTH SERVICES, LLC | |
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DIPLOMAT SPECIALTY PHARMACY OF FLINT, LLC | |
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DIPLOMAT SPECIALTY PHARMACY OF GRAND RAPIDS, LLC | |
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DIPLOMAT SPECIALTY PHARMACY OF CHICAGO, LLC | |
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DIPLOMAT SPECIALTY PHARMACY OF FT. LAUDERDALE, LLC | |
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DIPLOMAT SPECIALTY PHARMACY OF SOUTHERN CALIFORNIA, LLC | |
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DIPLOMAT SPECIALTY PHARMACY GREAT LAKES DISTRIBUTION CENTER, LLC | |
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DIPLOMAT CORPORATE PROPERTIES, LLC | |
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By: Diplomat Pharmacy, Inc., its member | |
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By: |
/s/ Xxxxxx X. Xxxxxxxx |
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Name: |
Xxxxxx X. Xxxxxxxx |
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Title: |
Chief Executive Officer |
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NAVIGATOR HEALTH SERVICES, LLC | |
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DSP FLINT REAL ESTATE, LLC | |
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DSP-BUILDING C, LLC | |
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DIPLOMAT INFUSION SERVICES, LLC | |
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DIPLOMAT HOLDING, LLC | |
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DIPLOMAT HEALTH MANAGEMENT, LLC | |
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By: |
/s/ Xxxxxx X. Xxxxxxxx |
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Name: |
Xxxxxx X. Xxxxxxxx |
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Title: |
Manager |
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AMERICAN HOMECARE FEDERATION, INC. | |
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By: |
/s/ Xxxx Xxxx |
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Name: |
Xxxx Xxxx |
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Title: |
President |
Signature Page to Consent Letter — June 2015
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MEDPRO RX, INC. | |
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By: |
/s/ Xxxxxxx Xxxx |
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Name: |
Xxxxxxx Xxxx |
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Title: |
President |
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AMBASSADOR COMPOUNDING, LLC | |
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ENVOY HEALTH MANAGEMENT, LLC | |
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By: |
/s/ Xxxxxxx Xxxx |
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Name: |
Xxxxxxx Xxxx |
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Title: |
Manager |
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BIORX, LLC | |
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By: |
/s/ Xxxxxxx Xxxx |
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Name: |
Xxxxxxx Xxxx |
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Title: |
Manager |
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DIPLOMAT BLOCKER, INC. | |
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By: |
/s/ Xxxx Xxxxxx |
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Name: |
Xxxx Xxxxxx |
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Title: |
President |
Signature Page to Consent Letter —June 2015
