Exhibit 10.1

 

FIRST AMENDMENT TO CREDIT AGREEMENT

 

This FIRST AMENDMENT TO CREDIT AGREEMENT, dated as of February 10, 2005 (this
“Amendment”), is entered into among WATSON PHARMACEUTICALS, INC., a Nevada
corporation (the “Borrower”), the Lenders (as defined below) party hereto and
the Administrative Agent (as defined below), and amends the Credit Agreement,
dated as of May 30, 2003 (as amended, supplemented or modified from time to
time, the “Credit Agreement”), entered into among the Borrower, the financial
institutions from time to time party hereto, whether by execution of the Credit
Agreement or an Assignment and Acceptance (the “Lenders”), WACHOVIA BANK,
NATIONAL ASSOCIATION, in its capacity as administrative agent for the Lenders
(in such capacity, the “Administrative Agent”), BANK OF AMERICA, N.A. and CIBC
WORLD MARKETS CORP., each in its capacity as co-syndication agent for the
Lenders (each, in such capacity, a “Syndication Agent”), and LEHMAN COMMERCIAL
PAPER, INC., in its capacity as documentation agent for the Lenders (in such
capacity, the “Documentation Agent”).  Unless otherwise defined herein, the
terms defined in the Credit Agreement shall be used herein as therein defined.

 

PRELIMINARY STATEMENT

 

The Requisite Lenders and the Borrower have agreed, subject to the terms and
conditions of this Amendment, to amend the Credit Agreement as hereinafter set
forth.

 

STATEMENT OF AGREEMENT

 

SECTION 1.  Amendment to Credit Agreement.  The Credit Agreement is, effective
as of the date hereof and subject to the satisfaction of the conditions
precedent set forth in Section 2 hereof, hereby amended as follows:

 

(a)                                  The definition of “Revolving Loan
Commitment Termination Date” is amended by deleting clause (A) thereof in its
entirety and substituting therefor the following:

 

“(A) May 1, 2008,”

 

(b)                                 Section 3.03(b) of the Credit Agreement is
amended by deleting it in its entirety and substituting therefor the following:

 

“(b)                           Apportionment of Payments.

 

(I)                                     SUBJECT TO THE PROVISIONS OF
SECTION 3.03(B)(II), ALL PAYMENTS OF PRINCIPAL AND INTEREST IN RESPECT OF
OUTSTANDING REVOLVING LOANS SHALL BE APPLIED BY THE ADMINISTRATIVE AGENT TO THE
RATABLE PAYMENT OF THE REVOLVING LOANS OWING TO THE LENDERS IN ACCORDANCE WITH
THEIR RESPECTIVE PRO RATA SHARES THEREOF.

 

(ii)                                  After the occurrence of an Event of
Default and while the same is continuing, the Administrative Agent shall apply
all payments and prepayments of any Obligations in the following order (without
duplication):

 

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(A)                              FIRST, TO PAY ALL PRINCIPAL OF AND INTEREST ON
ANY REVOLVING LOANS WHICH THE ADMINISTRATIVE AGENT MAY HAVE ADVANCED ON BEHALF
OF ANY LENDER PURSUANT TO SECTION 2.01(C)(II) FOR WHICH THE ADMINISTRATIVE AGENT
HAS NOT BEEN REIMBURSED BY SUCH LENDER OR THE BORROWER;

 

(B)                                SECOND, TO PAY ALL OBLIGATIONS IN RESPECT OF
ANY FEES, EXPENSE REIMBURSEMENTS OR INDEMNITIES THEN DUE TO THE AGENTS (SOLELY
IN THEIR CAPACITY AS AGENTS);

 

(C)                                THIRD, TO PAY ALL OBLIGATIONS IN RESPECT OF
ANY EXPENSE REIMBURSEMENTS OR INDEMNITIES THEN DUE TO ANY LENDER;

 

(D)                               FOURTH, TO PAY ALL OBLIGATIONS CONSISTING OF
ACCRUED FEES AND INTEREST THEN DUE; AND

 

(E)                                 FIFTH, TO PAY ALL OTHER OBLIGATIONS THEN
OUTSTANDING AND DUE (INCLUDING, WITHOUT LIMITATION, ALL OUTSTANDING PRINCIPAL
THEREOF AND ALL OUTSTANDING REIMBURSEMENT OBLIGATIONS), AND THEREAFTER, SOLELY
TO THE EXTENT THEN REQUIRED BY THE AGENT AND THE REQUISITE LENDERS, TO THE CASH
COLLATERALIZATION OF ANY REMAINING OUTSTANDING LETTER OF CREDIT OBLIGATIONS.

 

The order of priority set forth in this Section 3.03(b)(ii) and the related
provisions of this Agreement are set forth solely to determine the rights and
priorities of the Administrative Agent and the Lenders as among themselves.  In
carrying out the foregoing, each of the Lenders (including the Issuing Bank, for
this purpose) shall receive an amount equal to its pro rata share (based on the
proportion that the amount of the relevant Obligations held by such Lender bears
to the aggregate amount of the relevant Obligations held by all Lenders) of
amounts available to be applied pursuant to clauses (C) through (E) above.  If
sufficient funds are not available to fund all Obligations described in any of
the foregoing clauses (A) through (E), the available funds shall be allocated to
the Obligations described in such clause ratably as provided herein.”

 

(c)                                  Section 9.06 of the Credit Agreement is
amended by deleting the number “$125,000,000” in subsection (a) thereof and
inserting “$300,000,000” in substitution therefor.

 

(d)                                 Section 6.01(J) of the Disclosure Letter is
amended by inserting the following at the end of the sentence immediately before
the period:

 

“and to the matters described and set forth under the captions “Securities
Litigation” and “Department of Health and Human Services Subpoena” in the
Borrower’s Report on Form 10-K for the fiscal year ended December 31, 2003 and
under the captions “Securities Litigation” and “Hormone Replacement Therapy
Litigation” in the Borrower’s Reports on Form 10-Q for the quarterly periods
ended June 30, 2004 and September 30, 2004, as applicable.”

 

SECTION 2.  Conditions Precedent to Effectiveness.  This Amendment shall become
effective as of the date first above written when the Administrative Agent shall
have received this Amendment executed by the Borrower and the Requisite Lenders.

 

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SECTION 3.  Representations and Warranties.  The Borrower represents and
warrants as follows:

 

(a)                                  After giving effect to this Amendment, all
of the representations and warranties contained in Section 6.01 of the Credit
Agreement and in the other Loan Documents are true and complete in all material
respects (except to the extent that such representations or warranties are made
as of an earlier date, in which case they shall be true and complete in all
material respects as of such earlier date).

 

(b)                                 After giving effect to this Amendment, no
Default or Event of Default has occurred and is continuing.

 

SECTION 4.  Reference to and Effect on the Loan Documents.

 

(a)                                  Upon the effectiveness of this Amendment,
on and after the date hereof each reference in the Credit Agreement to “this
Agreement,” “hereunder,” “hereof” or words of like import referring to the
Credit Agreement, and each reference in the other Loan Documents to “the Credit
Agreement,” “thereunder,” “thereof” or words of like import referring to the
Credit Agreement, shall mean and be a reference to the Credit Agreement as
amended hereby.

 

(b)                                 Except as specifically amended above, the
Credit Agreement and all other Loan Documents are and shall continue to be in
full force and effect and are hereby in all respects ratified and confirmed.

 

(c)                                  The execution, delivery and effectiveness
of this Amendment shall not operate as a waiver of any right, power or remedy of
any Lender or the Administrative Agent under any of the Loan Documents, nor
constitute a waiver of any provision of any of the Loan Documents.

 

SECTION 5.  Execution in Counterparts.  This Amendment may be executed in any
number of counterparts and by different parties hereto in separate counterparts,
each of which when so executed and delivered shall be deemed to be an original
and all of which taken together shall constitute but one and the same agreement.

 

SECTION 6.  Governing Law.  This Amendment shall be governed by, and construed
in accordance with, the laws of the State of New York.

 

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IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be executed
as of the date first above written.

 

 

 

WATSON PHARMACEUTICALS, INC.

 

 

 

 

 

 

 

By:

  /s/ Charles P. Slacik

 

 

Name:

Charles P. Slacik

 

Title:

Executive Vice President and Chief

 

 

Financial Officer

 

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WACHOVIA BANK, NATIONAL

 

ASSOCIATION, as Administrative Agent and

 

Lender

 

 

 

 

 

 

 

By:

  /s/ Christian M. Bradeen

 

 

Name:

Christian M. Bradeen

 

Title:

Vice President

 

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CIBC INC., as Lender

 

 

 

 

 

 

 

By:

  /s/ George Knight

 

 

Name:

George Knight

 

Title:

Managing Director

 

 

CIBC World Markets Corp. as Agent

 

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BANK OF AMERICA, N.A., as Lender

 

 

 

 

 

 

 

By:

  /s/ Joseph Corah

 

 

Name:

Joseph Corah

 

Title:

Senior Vice President

 

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LEHMAN COMMERCIAL PAPER, INC., as

 

Lender

 

 

 

 

 

 

 

 

By:

  /s/ Janine M. Shugan

 

 

Name:

Janine M. Shugan

 

Title:

Authorized Signatory

 

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BANCO POPULAR DE PUERTO RICO, NEW

 

YORK BRANCH, as Lender

 

 

 

 

 

 

 

By:

  /s/ Hector J. Gonzalez

 

 

Name:

Hector J. Gonzalez

 

Title:

Vice President

 

S-6

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BANK LEUMI USA, as Lender

 

 

 

 

 

By:

  /s/ Joung Hee Hong

 

 

Name:

Joung Hee Hong

 

Title:

Vice President

 

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THE BANK OF EAST ASIA, LIMITED, as Lender

 

LOS ANGELES BRANCH

 

 

 

 

 

By:

  /s/ David Loh

 

 

Name:

David Loh

 

Title:

SVP-Commercial Lending

 

 

 

 

 

 

 

By:

  /s/ Victor Li

 

 

Name:

Victor Li

 

Title:

General Manager

 

 

 

 

 

Signature page for First Amendment to the Credit

 

Agreement for Watson Pharmaceuticals, Inc.

 

S-8

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CHIAO TUNG BANK CO., LTD.  NEW YORK
AGENCY, as Lender

 

 

 

 

 

By:

 

 

 

Title:

 

 

 

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COMERICA BANK, as Lender

 

 

 

 

 

By:

  /s/ Don R. Carruth

 

 

Name:

Don R. Carruth

 

 

Title:

Corporate Banking Officer

 

S-10

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E.SUN COMMERCIAL BANK, LTD., LOS

 

ANGELES BRANCH, as Lender

 

 

 

 

 

By:

  /s/ Benjamin Lin

 

 

Name:

Benjamin Lin

 

 

Title:

EVP & General Manager

 

S-11

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FIRST COMMERCIAL BANK, as Lender

 

 

 

 

 

By:

  /s/ Chih-Tiao Shih

 

 

Name:

Chih-Tiao Shih

 

 

Title:

SAVP & Deputy General Manager

 

S-12

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THE NORTHERN TRUST COMPANY, as Lender

 

 

 

 

 

 

 

By:

  /s/ John E. Burda

 

 

Name:

John E. Burda

 

Title:

Vice President

 

S-13

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SUMITOMO MITSUI BANKING

 

CORPORATION, as Lender

 

 

 

 

 

 

 

By:

  /s/ Al Galluzzo

 

 

Name:

Al Galluzzo

 

Title:

Senior Vice President

 

S-14

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TAIPEI BANK, as Lender

 

 

 

 

 

 

 

By:

 

 

 

Title:

 

 

 

S-15

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U.S. BANK, NATIONAL ASSOCIATION, as
Lender

 

 

 

 

 

 

 

By:

 

 

 

Title:

 

 

 

S-16

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UNION BANK OF CALIFORNIA, N.A., as Lender

 

 

 

 

 

 

 

By:

  /s/ Peter Thompson

 

 

Name:

Peter Thompson

 

Title:

Vice President

 

S-17

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UNITED OVERSEAS BANK LIMITED, LOS

 

ANGELES AGENCY, as Lender

 

 

 

 

 

 

 

By:

  /s/ Hoong Chen

 

 

Name:

Hoong Chen

 

Title:

First VP and General Manager

 

S-18

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CATHAY UNITED BANK (fka United World

 

Chinese Commercial Bank), as Lender

 

 

 

 

 

 

 

By:

  /s/ Allen Peng

 

 

Name:

Allen Peng

 

Title:

EVP and General Manager

 

S-19

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WELLS FARGO BANK, N.A., as Lender

 

 

 

 

 

 

 

By:

  /s/ Daniel J. Heller

 

 

Name:

Daniel J. Heller

 

Title:

SVP

 

S-20

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