Exhibit 10.01
AMENDMENT NUMBER TWO TO AMENDED AND RESTATED
CREDIT AGREEMENT
     This AMENDMENT NUMBER TWO TO AMENDED AND RESTATED CREDIT AGREEMENT (this
“Amendment”), dated as of June 27, 2007, is entered into among Matrixx
Initiatives, Inc., a Delaware corporation (“Parent”), Zicam, LLC, an Arizona
limited liability company (“Zicam”) (Parent and Zicam are sometimes individually
referred to herein as a “Borrower” and collectively referred to herein as
“Borrowers”), on the one hand, and Comerica Bank, a Michigan banking corporation
(“Bank”), on the other hand, with reference to the following facts:
     A. Parent and Zicam, on the one hand, and Bank, on the other hand,
previously entered into that certain Amended and Restated Credit Agreement,
dated as of September 27, 2005 (the “Original Agreement”) and that certain
Amendment Number One to Amended and Restated Credit Agreement and Waiver, dated
as of March 9, 2006 (the “First Amendment”, which together with the Original
Agreement is collectively referred to hereinafter as the “Agreement”), which
Agreement provides for, among other things, a revolving loan in the principal
amount of up to Four Million Dollars ($4,000,000), which is being amended by
this Amendment to increase such revolving loan to Eight Million Dollars
($8,000,000); and
     B. The parties desire to further amend the Agreement in accordance with the
terms and conditions of this Amendment.
     NOW, THEREFORE, in consideration of the foregoing, the parties hereto
hereby agree as follows:
     1. Incorporation of Recitals. The foregoing recitals are true and accurate
and are hereby incorporated by this reference in their entirety as a material
part of this Amendment.
     2. Defined Terms. All initially capitalized terms used but not defined
herein shall have the meanings assigned to such terms in the Original Agreement.
     3. Amendments to Section 1.1.
          (a) The following definitions set forth in Section 1.1 of the Original
Agreement are hereby amended in their entirely as follows:
     “Base Lending Rate” means the variable per annum rate equal to the Base
Rate minus the Base Lending Rate Margin.
     “Fees” means the Late Payment Fee, the Letter of Credit Fees, and the
Unused Revolving Commitment Fee.
     “Note” means the Replacement Secured Promissory Note, dated as of June 27,
2007, executed by Borrowers, as Makers, to the order of Bank, as Payee, in the
principal amount of Eight Million Dollars ($8,000,000).

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     “Revolving Credit Commitment” means Eight Million Dollars ($8,000,000).
     “Revolving Loans Maturity Date” means July 2, 2009.
          (b) The following new definition is hereby added to Section 1.1 of the
Original Agreement:
     “Unused Revolving Commitment Fee” has the meaning set forth in Section 4 of
this Amendment.
     4. Amendment to Section 2.14. Section 2.14 of the Original Agreement is
hereby amended and supplemented with a new subsection (c) as follows:
     (c) Borrowers shall pay to Bank on a quarterly basis an unused commitment
fee (the “Unused Revolving Commitment Fee”) in an amount equal to one quarter of
one percent (0.25%) per annum multiplied by the difference of the Revolving
Credit Commitment minus the sum of (i) the average daily outstanding Revolving
Loans during the prior quarter plus (ii) the average daily Letter of Credit
Usage during the prior quarter. The Unused Commitment Fee shall begin to accrue
on the date hereof and shall be due and payable, in arrears, on the first
Business Day of each and every December, March, June and September, and the
Revolving Loans Maturity Date. The Unused Commitment Fee shall be calculated on
the basis of a year of three hundred sixty (360) days for the actual days
elapsed. No Unused Revolving Commitment Fee will be payable for periods after
the Revolving Loans Maturity Date, Notwithstanding the foregoing, no Unused
Revolving Commitment Fee shall accrue or be payable for any quarter during which
Borrowers shall have maintained, at all times during such quarter, a minimum
balance of $1,250,000 in a money market account at Bank (the “Money Market
Account”), which Money Market Account shall be opened by Borrowers concurrently
with Borrowers’ execution of this Amendment.
     5. Replacement of Schedule 5.9. Schedule 5.9 of the Original Agreement is
hereby amended in its entirety and replaced with the Schedule 5.9 attached to
this Amendment and incorporated hereby.
     6. New Subsidiary. Borrowers shall cause its Subsidiary, Matrixx Oral Care,
LLC, a Delaware limited liability company, to execute and deliver to Bank no
later than July 16, 2007, a Guaranty and security agreement, in form and
substance satisfactory to Bank.
     7. Representations and Warranties. In order to induce Bank to enter into
this Amendment, Borrowers hereby represent and warrant to Bank that:
          (a) No Event of Default or Unmatured Event of Default has occurred and
is continuing;

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          (b) All of the representations and warranties set forth in the
Agreement and the Loan Documents are true, complete and accurate in all respects
(except for representations and warranties which are expressly stated to be true
and correct as of the Closing Date); and
          (c) This Amendment has been duly executed and delivered by the
Borrowers and Guarantor, and after giving effect to this Amendment, the
Agreement and the Loan Documents continue to constitute the legal, valid and
binding agreements and obligations of the Borrowers and Guarantor enforceable in
accordance with their terms, except as enforceability may be limited by
bankruptcy, insolvency, and similar laws and equitable principles affecting the
enforcement of creditors’ rights generally.
     8. Conditions Precedent to Effectiveness of Amendment. The effectiveness of
this Amendment is subject to and contingent upon the fulfillment of each and
every one of the following conditions:
          (a) Bank shall have received this Amendment, duly executed by the
Borrowers, together with the Consent of Guarantor attached hereto duly executed
by the Guarantor;
          (b) Bank shall have received the Note (as defined in Section 3 above),
duly executed by Borrower;
          (c) Borrowers shall have paid to Bank a commitment fee in the amount
of $10,000.00, which shall be fully earned and nonrefundable;
          (d) Borrowers shall have opened the Money Market Account (as defined
in Section 4 above) at Bank;
          (e) No Event of Default, Unmatured Event of Default or Material
Adverse Effect shall have occurred and be continuing; and
          (f) All of the representations and warranties set forth herein, in the
Loan Documents and in the Agreement shall be true, complete and accurate in all
respects as of the date hereof (except for representations and warranties which
are expressly stated to be true and correct as of the Closing Date).
     9. Counterparts; Telefacsimile Execution. This Amendment may be executed in
any number of counterparts and by different parties on separate counterparts,
each of which, when executed and delivered, shall be deemed to be an original,
and all of which, when taken together, shall constitute but one and the same
Amendment, Delivery of an executed counterpart of this Amendment by
telefacsimile shall be equally as effective as delivery of a manually executed
counterpart of this Amendment. Any party delivering an executed counterpart of
this Amendment by telefacsimile shall also deliver a manually executed
counterpart of this Amendment but the failure to deliver a manually executed
counterpart shall not affect the validity, enforceability, and binding effect of
this Amendment.

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     10. Integration. The Agreement as amended by this Amendment constitutes the
entire agreement and understanding between the parties hereto with respect to
the subject matter hereof and thereof, and supersedes any and all prior
agreements and understandings, oral or written, relating to the subject matter
hereof and thereof.
     11. Reaffirmation of the Agreement. The Agreement as amended hereby and the
other Loan Documents remain in full force and effect.
[remainder of page intentionally left blank; signatures to follow]

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     IN WITNESS WHEREOF, the parties hereto have duly executed and delivered
this Amendment as of the date first hereinabove written.

              MATRIXX INITIATIVES, INC., a Delaware corporation
 
       
 
  By:   /s/ William J. Hemelt
 
       
 
  Name:   WILLIAM J. HEMELT
 
  Title:   EVP/CFO
 
            ZICAM, LLC, an Arizona limited liability company
 
       
 
  By:   /s/ William J. Hemelt
 
       
 
  Name:   WILLIAM J. HEMELT
 
  Title:   MANAGER/CFO
 
            COMERICA BANK
 
       
 
  By:   /s/ Chris Barone
 
       
 
  Name:   Chris Barone
 
  Title:   Commercial Banking Officer

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Schedule 5.9
To
Credit Agreement
Subsidiaries
     1. Zicam, LLC, owned 100% by Matrixx Initiatives, Inc.
     2. Matrixx Oral Care, LLC, owned 100% by Matrixx Initiatives, Inc.

 

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CONSENT OF GUARANTORS
     The undersigned, as “Guarantor” under a Continuing Guaranty, dated as of
November 22, 2005 (“Guaranty”), executed in favor of Comerica Bank, a Michigan
banking corporation (“Bank”), with respect to the obligations of Matrixx
Initiatives, Inc., a Delaware corporation, and Zicam, LLC, an Arizona limited
liability company (collectively, “Borrowers”) owing to Bank, hereby acknowledges
receipt of a copy of the foregoing Amendment Number Two to Amended and Restated
Credit Agreement, dated as of June 27, 2007, among Borrower and Bank, consents
to the terms contained therein, and agrees that the Guaranty executed by the
undersigned shall remain in full force and effect.
     Although Bank has informed the undersigned of the matters set forth above
and the undersigned has acknowledged same, the undersigned understands and
agrees that Bank has no duty under the Agreement, the Guaranty, or any other
agreement between us to so notify the undersigned or to seek an acknowledgment,
and nothing herein is intended to or shall create such a duty as to any advances
or transactions hereafter.

              ZICAM SWAB PRODUCTS, LLC, a
Delaware limited liability company
 
       
 
  By :   /s/ William Hemelt
 
       
 
  Name:   William Hemelt
 
  Title:   Manager