EXHIBIT 10.39
FIRST AMENDMENT TO CREDIT AGREEMENT
THIS FIRST AMENDMENT TO CREDIT AGREEMENT (this "Amendment") is entered
into as of June 10, 2002, by and between GEN-PROBE INCORPORATED, a Delaware
corporation and GEN-PROBE SALES & SERVICE, INC., a Delaware corporation
(collectively, "Borrowers" and each, a "Borrower"), and XXXXX FARGO BANK,
NATIONAL ASSOCIATION ("Bank").
RECITALS
WHEREAS, Borrowers are currently indebted to Bank pursuant to the terms
and conditions of that certain Credit Agreement between Borrowers and Bank dated
as of April 10, 2001, as amended from time to time ("Credit Agreement").
WHEREAS, Bank and Borrowers have agreed to certain changes in the terms
and conditions set forth in the Credit Agreement and have agreed to amend the
Credit Agreement to reflect said changes.
NOW, THEREFORE, for valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, the parties hereto agree that the Credit
Agreement shall be amended as follows:
1. Section 1.1.(a) is hereby amended by deleting "July 1, 2002" as the
last day on which Bank will make advances under the Line of Credit, and by
substituting for said date "July 1, 2004," with such change to be effective upon
the execution and delivery to Bank of a promissory note substantially in the
form of EXHIBIT A attached hereto (which promissory note shall replace and be
deemed the Line of Credit Note defined in and made pursuant to the Credit
Agreement) and all other contracts, instruments and documents required by Bank
to evidence such change.
2. Section 1.1.(c) is hereby renumbered as Section 1.1.(d) and the
following is hereby added to the Credit Agreement as Section 1.1.(c):
"(c) Letter of Credit Subfeature. As a subfeature under
the Line of Credit, Bank agrees from time to time during the term
thereof to issue or cause an affiliate to issue standby letters
of credit for the account of Borrowers to finance Borrowers'
general corporate purposes (each, a "Letter of Credit" and
collectively, "Letters of Credit"); provided however, that the
aggregate undrawn amount of all outstanding Letters of Credit
shall not at any time exceed Five Million Dollars
($5,000,000.00). The form and substance of each Letter of Credit
shall be subject to approval by Bank, in its sole discretion. No
Letter of Credit shall have an expiration date subsequent to the
maturity date of the Line of Credit. The undrawn amount of all
Letters of Credit shall be reserved under the Line of Credit and
shall not be available for borrowings thereunder. Each Letter of
Credit shall be subject to the additional terms and conditions of
the Letter of Credit agreements, applications and any related
documents required by
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Bank in connection with the issuance thereof. Each draft paid
under a Letter of Credit shall be deemed an advance under the
Line of Credit and shall be repaid by Borrowers in accordance
with the terms and conditions of this Agreement applicable to
such advances; provided however, that if advances under the Line
of Credit are not available, for any reason, at the time any
draft is paid, then Borrowers shall immediately pay to Bank the
full amount of such draft, together with interest thereon from
the date such draft is paid to the date such amount is fully
repaid by Borrowers, at the rate of interest applicable to
advances under the Line of Credit. In such event Borrowers agree
that Bank, in its sole discretion, may debit any account
maintained by Borrowers or either of them with Bank for the
amount of any such draft."
3. The second paragraph of Section 1.2.(d) (which paragraph begins "Bank
shall adjust") is hereby deleted in its entirety, and the following substituted
therefor:
"Bank shall adjust the percentage per annum used to
determine the amount of the fee on a quarterly basis, commencing
with Borrowers' fiscal quarter ending June 30, 2002, if required
to reflect a change in Borrower's ratio of Funded Debt to EBITDA
(as defined in Section 4.9(e) below), in accordance with the
following grid:
Funded Debt to EBITDA
Percentage
Less than .75 to 1.0 .250
Greater than or equal to
.75 .375"
4. The following is hereby added to the Credit Agreement as Section
1.2.(e):
"(e) Letter of Credit Fees. Borrowers shall pay to Bank
(i) fees upon the issuance of each Letter of Credit equal to one
and one-half percent (1.5%) per annum (computed on the basis of a
360-day year, actual days elapsed) of the face amount thereof,
and (ii) fees upon the payment or negotiation of each draft under
any Letter of Credit and fees upon the occurrence of any other
activity with respect to any Letter of Credit (including without
limitation, the transfer, amendment or cancellation of any Letter
of Credit) determined in accordance with Bank's standard fees and
charges then in effect for such activity."
5. Section 4.9.(d) is hereby deleted, and the following substituted
therefor:
"(d) EBITDA not less than $17,000,000.00 as of June 30,
2002 and September 30, 2002, and not less than $23,000,000.00 as
of each fiscal quarter end thereafter, calculated on a rolling
four-quarter basis, with "EBITDA" defined as net profit
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before tax plus interest expense (net of capitalized interest
expense), depreciation expense and amortization expense."
6. Section 4.9(h) is hereby deleted, and the following substituted
therefor:
(h) Net income after taxes not less than $1.00 for the
fiscal quarter ending December 31, 2001.
(i) Net loss after taxes for the fiscal quarter ending
March 31, 2002, not less than $1,000,000.00.
(j) Net loss after taxes for the fiscal quarter ending
June 30, 2002 not to exceed $1,500,000.00.
(k) Net income after taxes not less than $1.00 on a
quarterly basis determined as of each fiscal quarter end
commencing with the fiscal quarter ending September 30, 2002. "
7. The following is hereby added to the Credit Agreement as Section
4.9.(l):
"(l) EBITDA Coverage Ratio not less than 2.0 to 1.0 as of
each fiscal year end, with "EBITDA" as defined above, and with
"EBITDA Coverage Ratio" defined as EBITDA divided by the
aggregate of total interest expense plus the prior period current
maturity of long-term debt and the prior period current maturity
of subordinated debt."
8. Section 7.11(c) is hereby deleted and replaced by the following:
(c) Each Borrower agrees that it is jointly and severally
liable to Bank for, and each Borrower agrees to pay to Bank when
due the full amount of, all indebtedness now existing or
hereafter arising to Bank under or in connection with the Line of
Credit and all modifications, extensions and renewals thereof,
including without limitation all advances disbursed to any
Borrower under the Line of Credit, all interest which accrues
thereon, all Letters of Credit issued for the account of any
Borrower, including without limitation the obligation to
reimburse Bank for the amount of any draft paid by Bank under any
such Letter of Credit, together with interest thereon, and all
fees, costs and expenses chargeable to Borrowers or any of them
in connection with the Line of Credit. References in the other
paragraphs of this Section 7.11 to the "Line of Credit" shall
include, without limitation, the Letter of Credit subfeature
thereunder."
9. In consideration of the changes set forth herein and as a condition
to the effectiveness hereof, immediately upon signing this Amendment Borrower
shall pay to Bank a non-refundable fee of $25,000.00.
10. Except as specifically provided herein, all terms and conditions of
the Credit Agreement remain in full force and effect, without waiver or
modification. All terms defined in the Credit Agreement shall have the same
meaning when used in this Amendment. This Amendment and the Credit Agreement
shall be read together, as one document.
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11. Borrower hereby remakes all representations and warranties contained
in the Credit Agreement and reaffirms all covenants set forth therein. Borrower
further certifies that as of the date of this Amendment there exists no Event of
Default as defined in the Credit Agreement, nor any condition, act or event
which with the giving of notice or the passage of time or both would constitute
any such Event of Default.
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
executed as of the day and year first written above.
XXXXX FARGO BANK,
GEN-PROBE INCORPORATED NATIONAL ASSOCIATION
By: By:
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Xxxxxx Xxxxx
Title: Vice President
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By:
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Title:
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GEN-PROBE SALES & SERVICE, INC.
By:
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Title:
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By:
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Title:
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