EXHIBIT 10.1.2
EXECUTION VERSION
SECOND AMENDMENT TO AMENDED AND RESTATED
LOAN AND SECURITY AGREEMENT
     THIS SECOND AMENDMENT TO AMENDED AND RESTATED LOAN AND SECURITY AGREEMENT
(the “Amendment”) is made effective as of the 31st day of December, 2008, by and
among IMPAX LABORATORIES, INC., a Delaware corporation (“Borrower”), and
WACHOVIA BANK, NATIONAL ASSOCIATION, a national banking association (together
with its successors and assigns (“Bank”).
BACKGROUND
     A. Pursuant to that certain Amended and Restated Loan and Security
Agreement dated December 15, 2005 by and between Borrower and Bank (as amended
by that certain First Amendment to Amended and Restated Loan and Security
Agreement dated October 14, 2008 and as the same may hereafter be further
amended, modified, supplemented or restated from time to time, being referred to
herein as the “Loan Agreement”), Bank agreed, inter alia, to amend and restate
an existing revolving line of credit in the maximum principal amount of
Thirty-Five Million Dollars ($35,000,000.00).
     B. Borrower has requested and Bank has agreed to amend the Loan Agreement
in accordance with the terms and conditions contained herein.
     C. All capitalized terms contained herein and not otherwise defined herein
shall have the meanings set forth in the Loan Agreement.
     NOW, THEREFORE, intending to be legally bound hereby, the parties hereto
agree as follows:
     1. Termination Date. The reference to “December 31, 2008” contained in the
definition of “Termination Date” in Section 1.1 of the Loan Agreement is hereby
deleted and replaced with “March 31, 2009”.
     2. Amendment/References. The Loan Agreement and the Loan Documents are
hereby amended to be consistent with the terms of this Amendment. All references
in the Loan Agreement and the Loan Documents to (a) the “Loan Agreement” shall
mean the Loan Agreement as amended hereby; and (b) the “Loan Documents” shall
include this Amendment and all other instruments or agreements executed pursuant
to or in connection with the terms hereof.
     3. Release. Borrower acknowledges and agrees that it has no claims, suits
or causes of action against Bank and hereby remises, releases and forever
discharges Bank, their officers, directors, shareholders, employees, agents,
successors and assigns, and any of them, from any claims, suits or causes of
action whatsoever, in law or at equity, which Borrower has or may have arising
from any act, omission or otherwise, at any time up to and including the date of
this Amendment.
     4. Additional Documents; Further Assurances. Borrower covenants and agrees
to execute and deliver to Bank, or to cause to be executed and delivered to Bank
contemporaneously herewith, at the sole cost and expense of Borrower, the
Amendment and any and all documents, agreements, statements, resolutions,
searches, insurance policies, consents, certificates, legal

 

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opinions and information as Bank may require in connection with the execution
and delivery of this Amendment or any documents in connection herewith, or to
further evidence, effect, enforce or protect any of the terms hereof or the
rights or remedies granted or intended to be granted to Bank herein or in any of
the Loan Documents, or to enforce or to protect Bank’s interest in the
Collateral. All such documents, agreements, statements, etc., shall be in form
and content acceptable to Bank in its sole discretion. Borrower hereby
authorizes Bank to file, at Borrower’s cost and expense, financing statements,
amendments thereto and other items as Bank may require to evidence or perfect
Bank’s continuing security interest and liens in and against the Collateral.
Borrower agrees to join with Bank in notifying any third party with possession
of any Collateral of Bank’s security interest therein and in obtaining an
acknowledgment from the third party that it is holding the Collateral for the
benefit of Bank. Borrower will cooperate with Bank in obtaining control with
respect to Collateral consisting of deposit accounts, investment property,
letter-of-credit rights and electronic chattel paper.
     5. Further Agreements and Representations. Borrower does hereby:
          (a) ratify, confirm and acknowledge that the statements contained in
the foregoing Background are true and complete and that, as amended hereby, the
Loan Agreement and the other Loan Documents are in full force and effect and are
valid, binding and enforceable against Borrower and its assets and properties,
all in accordance with the terms thereof, as amended;
          (b) covenant and agree to perform all of Borrower’s obligations under
the Loan Agreement and the other Loan Documents, as amended;
          (c) acknowledge and agree that as of the date hereof, Borrower has no
defense, set-off, counterclaim or challenge against the payment of any of the
Obligations or the enforcement of any of the terms of the Loan Agreement or of
the other Loan Documents, as amended;
          (d) acknowledge and agree that all representations and warranties of
Borrower contained in the Loan Agreement and/or the other Loan Documents, as
amended (including, without limitation as modified by the amendments set forth
on Schedule A hereto), are true, accurate and correct on and as of the date
hereof as if made on and as of the date hereof;
          (e) represent and warrant that no Default or Event of Default exists;
          (f) covenant and agree that Borrower’s failure to comply with any of
the terms of this Amendment or any other instrument or agreement executed or
delivered in connection herewith, shall constitute an Event of Default under the
Loan Agreement and each of the other Loan Documents; and
          (g) acknowledge and agree that nothing contained herein, and no
actions taken pursuant to the terms hereof, are intended to constitute a
novation of the Note, the Loan Agreement or of any of the other Loan Documents
and does not constitute a release, termination or waiver of any existing Event
of Default or of any of the liens, security interests, rights or remedies
granted to the Bank in any of the Loan Documents, which liens, security
interests, rights and remedies are hereby expressly ratified, confirmed,
extended and continued as security for all of the Obligations.
     Borrower acknowledges and agrees that Bank is relying on the foregoing
agreements, confirmations, representations and warranties of Borrower and the
other agreements, representations and warranties of Borrower contained herein in
agreeing to the amendments contained in this Amendment.

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     6. Fees, Cost, Expenses and Expenditures. Borrower will pay all of Bank’s
reasonable, out-of-pocket expenses in connection with the review, preparation,
negotiation, documentation and closing of this Amendment and the consummation of
the transactions contemplated hereunder, including without limitation, fees,
disbursements, expenses and disbursements of counsel retained by Bank and all
fees related to filings, recording of documents, searches, environmental
assessments and appraisal reports, whether or not the transactions contemplated
hereunder are consummated.
     7. No Waiver. Nothing contained herein constitutes an agreement or
obligation by Bank to grant any further amendments to the Loan Agreement or any
of the other Loan Documents. Nothing contained herein constitutes a waiver or
release by Bank of any Event of Default or of any rights or remedies available
to Bank under the Loan Documents or at law or in equity.
     8. Inconsistencies. To the extent of any inconsistencies between the terms
and conditions of this Amendment and the terms and conditions of the Loan
Agreement or the other Loan Documents, the terms and conditions of this
Amendment shall prevail. All terms and conditions of the Loan Agreement and
other Loan Documents not inconsistent herewith shall remain in full force and
effect and are hereby ratified and confirmed by Borrower.
     9. Binding Effect. This Amendment, upon due execution hereof, shall be
binding upon and inure to the benefit of the parties hereto and their respective
successors and assigns.
     10. Governing Law. This Amendment shall be governed and construed in
accordance with the laws of the Commonwealth of Pennsylvania without regard to
conflict of law principles.
     11. Severability. The provisions of this Amendment and all other Loan
Documents are deemed to be severable, and the invalidity or unenforceability of
any provision shall not affect or impair the remaining provisions which shall
continue in full force and effect.
     12. Modifications. No modification of this Amendment or any of the Loan
Documents shall be binding or enforceable unless in writing and signed by or on
behalf of the party against whom enforcement is sought.
     13. Headings. The headings of the Articles, Sections, paragraphs and
clauses of this Amendment are inserted for convenience only and shall not be
deemed to constitute a part of this Amendment.
     14. Counterparts. This Amendment may be executed in multiple counterparts,
each of which shall constitute an original and all of which together shall
constitute the same agreement.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

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     IN WITNESS WHEREOF, the parties hereto, intending to be legally bound
hereby, have caused this Amendment to be executed the day and year first above
written.

            IMPAX LABORATORIES, INC.
      By:   /s/ Arthur A. Koch, Jr.       Name/Title: Arthur A. Koch, Jr., SVP -
CFO                WACHOVIA BANK, NATIONAL
ASSOCIATION
      By:   /s/ Margaret A. Byrne       Name/Title: Margaret A. Byrne ,
Director             

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EXHIBIT A
SUPPLEMENTAL DISCLOSURE SCHEDULES
OF
IMPAX LABORATORIES, INC.
Dated: December 30, 2008
Wachovia Bank, National Association
Widener Building
1339 Chestnut Street
Philadelphia, PA 19107
     In connection with delivery of a certain Second Amendment to Amended and
Restated Loan and Security Agreement relating to a financing provided by you
(“Lender”), the undersigned (the “Company”) represents and warrants to Lender
the following information about it, its organizational structure and other
matters of interest to Lender as a supplement to the information initially
disclosed to Lender in the Supplemental Informational Certificate of Impax
Laboratories, Inc. dated October 10, 2008 (the “Information Certificate”). The
disclosures in these Schedules modify or supersede any inconsistent disclosures
in the Information Certificate to the extent described herein.
1. Schedule 8.2 to the Information Certificate is hereby deleted in its entirety
and replaced with the following:
SCHEDULE 8.2
To
INFORMATION CERTIFICATE
Locations
A. Chief Executive Offices
121 New Britain Boulevard, Chalfont, PA 18914
30831 Huntwood Avenue, Hayward, CA 94544
B. Location of Books and Records
121 New Britain Boulevard, Chalfont, PA 18914
30831 Huntwood Avenue, Hayward, CA 94544
3735 Castor Avenue, Philadelphia, PA 19124
31153 San Antonio Street, Hayward, CA 94544
1502 Crocker Avenue, Hayward, CA 94544
C. Locations of Inventory, Equipment and Other Assets

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          Address   Ownership   Landlord (If Leased)
30831 Huntwood Avenue
Hayward, CA 94544
  Owned    
 
       
31153 San Antonio Street,
Hayward, CA 94544
  Owned    
 
       
1502 Crocker Avenue
Hayward, CA 94544
  Leased   RREEF Management Co.
26120 Eden Landing Road
Suite 2
Hayward, CA 94545

 
       
3735 Castor Avenue
Philadelphia, PA 19124
  Owned    
 
       
30941-30945 San Clemente St.
Hayward, CA 94544
  Leased   Buckhead Industrial Properties, Inc.
c/o Lend Lease Real Estate Investments, Inc.
One Front St., Suite 1100
San Francisco, CA 94111
 
       
7026 Knoll Center Parkway
Suite 225
Pleasanton, CA 94566
  Leased   7-L Northcreek, LLC
4175 Business Center Drive
Fremont, CA 94538
 
       
121 New Britain Blvd.
New Britain, PA 18914
  Leased   Nappen & Associates
119 Keystone Drive
Montgomeryville, PA 18936
 
       
1490 Crocker Avenue
Hayward, CA 94544
  Owned    
 
       
1508 Crocker Avenue
Hayward, CA 94544
  Leased   RREEF Management Co.
26120 Eden Landing Road
Suite 2
Hayward, CA 94545

 
       
31047 Genstar Avenue
Hayward, CA 94544
  Leased   United Genstar
31047 Genstar Avenue
Hayward, CA 94544
 
       
41316 Christy Street
Freemont, CA 94538
  Leased    

D. Locations of Assets in Prior Five (5) Years not Listed Above – 4580
Mendenhall Road, Memphis, TN
E. Other – Borrower currently has a new plant under construction in Taiwan,
P.R.C.
2. Schedule 8.6 to the Information Certificate is hereby deleted in its entirety
and replaced with the following:
SCHEDULE 8.6
To
INFORMATION CERTIFICATE

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Pending Litigation
Patent-Infringement Litigation
AstraZeneca AB et al. v. Impax Laboratories (Omeprazole)
In litigation commenced against us in the U.S. District Court for the District
of Delaware in May 2000, AstraZeneca AB alleged that our submission of an ANDA
seeking FDA permission to market Omeprazole Delayed Release Capsules, 10mg, 20mg
and 40mg, constituted infringement of AstraZeneca’s U.S. patents relating to its
Prilosec® product and sought an order enjoining us from marketing our product
until expiration of its patents. The case, along with several similar suits
against other manufacturers of generic versions of Prilosec®, was subsequently
transferred to the U.S. District Court for the Southern District of New York.
In September 2004 , following expiration of the 30-month stay, the FDA approved
our ANDA and we and our alliance agreement partner, Teva, commenced commercial
sales of our product. In January 2005, AstraZeneca added claims of willful
infringement, for damages, and for enhanced damages on the basis of this
commercial launch. Claims for damages were subsequently dropped from the suit
against the Company, but were included in a separate suit filed against Teva. In
May 2007, the court found that our product infringed two of AstraZeneca’s
patents and that these patents were not invalid. The court ordered that FDA
approval of our ANDA be converted to a tentative approval, with a final approval
date not before October 20, 2007, the expiration date of the relevant pediatric
exclusivity period. In August 2008 the U.S. Court of Appeals for the Federal
Circuit affirmed the lower court’s decision of infringement and validity. If
Teva is not ultimately successful in establishing invalidity or non-infringement
in the separate suit against Teva, the court may award monetary damages
associated with Teva’s commercial sale of our omeprazole products. Under our
Teva Agreement, we would be responsible for monetary damages awarded against
Teva up to a specified level, beyond which, monetary damages would be Teva’s
responsibility.
Aventis Pharmaceuticals Inc., et al. v. Impax Laboratories, Inc.
(Fexofenadine/Pseudoephedrine)
We are a defendant in an action brought in March 2002 by Aventis Pharmaceuticals
Inc. and others in the U.S. District Court for the District of New Jersey
alleging that our proposed Fexofenadine and Pseudoephedrine hydrochloride
tablets, generic to Allegra-D® infringe seven Aventis patents and seeking an
injunction preventing us from marketing the products until expiration of the
patents. The case has since been consolidated with similar actions brought by
Aventis against five other manufacturers (including generics to both Allegra®
and Allegra-D®). In March 2004, Aventis and AMR Technology, Inc. filed a
complaint and first amended complaint against us and one of the other defendants
alleging infringement of two additional patents, owned by AMR and licensed to
Aventis, relating to a synthetic process for making the active pharmaceutical
ingredient, Fexofenadine hydrochloride and intermediates in that synthetic
process. We believe that we have defenses to the claims based on
non-infringement and invalidity.

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In June 2004, the court granted our motion for summary judgment of
non-infringement with respect to two of the patents and, in May 2005, granted
summary judgment of invalidity with respect to a third patent. We will have the
opportunity to file additional summary judgment motions in the future and to
assert both non-infringement and invalidity of the remaining patents (if
necessary) at trial. No trial date has yet been set.
In September 2005, Teva launched its Fexofenadine tablet products (generic to
Allegra®), and Aventis and AMR moved for a preliminary injunction to bar Teva’s
sales based on four of the patents in suit, which patents are common to the
Allegra® and Allegra-D® litigations. The district court denied Aventis’s motion
in January 2006, finding that Aventis did not establish a likelihood of success
on the merits, which decision was affirmed on appeal.
Impax Laboratories, Inc. v. Aventis Pharmaceuticals, Inc. (Riluzole)
In June 2002, we filed a suit against Aventis Pharmaceuticals, Inc. in the U.S.
District Court for the District of Delaware, seeking a declaration that our
filing of an ANDA for Riluzole 50mg tablets, generic to Rilutek®, for treatment
of patients with amyotrophic lateral scleroses (ALS) did not infringe claims of
Aventis’s patent relating to the drug and a declaration that its patent is
invalid. Aventis filed counterclaims for infringement, and, in December 2002,
the district court granted Aventis’ motion for a preliminary injunction
enjoining us from marketing any pharmaceutical product or compound containing
Riluzole for the treatment of ALS.
In September 2004, the district court found Aventis’s patent not invalid and
infringed by our proposed product. In November 2006, the Court of Appeals for
the Federal Circuit vacated the district court’s finding that the patent was not
invalid and remanded for further findings on that issue, and, in June 2007, the
district court again found that Aventis’s patent is not invalid. In
October 2008, the Court of Appeals for the Federal Circuit affirmed the district
court decision. The court is expected to enter a permanent injunction enjoining
us from marketing Riluzole 50mg tablets for the treatment of ALS until the
expiration of Aventis’s patent in June 2013.
Endo Pharmaceuticals Inc., et al. v. Impax Laboratories, Inc. (Oxymorphone)
In November 2007, Endo Pharmaceuticals Inc. and Penwest Pharmaceuticals Co.
(collectively, “Endo”) filed suit against us in the U.S. District Court for the
District of Delaware, requesting a declaration that our Paragraph IV Notices
with respect to our ANDA for Oxymorphone Hydrochloride Extended Release Tablets
5 mg, 10 mg, 20 mg and 40 mg, generic to Opana ER®, are null and void and, in
the alternative, alleging patent infringement in connection with the filing of
that ANDA. Endo subsequently dismissed its request for declaratory relief and in
December 2007 filed another patent infringement suit relating to the same ANDA.
In July 2008, Endo asserted additional infringement claims with respect to our
amended ANDA, which added 7.5mg, 15mg and 30mg strengths of the product. We have
filed an answer and counterclaims. Discovery is in the early stages, and no
trial date has been set.
Impax Laboratories, Inc. v. Medicis Pharmaceutical Corp. (Minocycline)
In January 2008, we filed a complaint against Medicis Pharmaceutical Corp. in
the U.S. District Court for the Northern District of California, seeking a
declaratory judgment that our filing of an ANDA relating to Minocycline
Hydrochloride Extended Release Tablets 45 mg, 90 mg, and 135

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mg, a generic to Solodyn®, did not infringe any valid claim of U.S. Patent No.
5,908,838. Medicis filed a motion to dismiss the complaint for lack of subject
matter jurisdiction. On April 16, 2008, the District Court granted Medicis’
motion to dismiss, and judgment was entered on April 22, 2008. In November 2008,
we entered into an agreement with Medicis to settle this litigation whereby
Medicis agreed to grant us a license to market our generic version of Solodyn®
upon the occurrence of certain conditions, but in any event no later than
November 2011.
Pfizer Inc., et al. v. Impax Laboratories, Inc. (Tolterodine)
In March 2008, Pfizer Inc., Pharmacia & Upjohn Company LLC and Pfizer Health AB
(collectively “Pfizer”) filed a complaint against us in the U.S. District Court
for the Southern District of New York, alleging that our filing of an ANDA
relating to Tolterodine Tartrate Extended Released Capsules, 4 mg, generic to
Detrol LA®, infringes three Pfizer patents. We have filed an answer and
counterclaims seeking declaratory judgment of non-infringement, invalidity or
unenforceability with respect to the patents at suit. In April 2008, the case
was transferred to the U.S. District Court for the District of New Jersey. On
September 3, 2008 an amended complaint was filed alleging infringement based on
our ANDA amendment adding a 2mg strength. Discovery is in the early stages, and
no trial date has been set.
Boehringer Ingelheim Pharmaceuticals, et al. v. Impax Laboratories (Tamsulosin)
In July 2008, Boehringer Ingelheim Pharmaceuticals Inc. and Astellas Pharma Inc.
(Collectively “Astellas”) filed a complaint against us in the U.S. District
Court for the Northern District of California, alleging that our filing of an
ANDA relating to Tamsulosin Hydrochloride Capsules, 0.4 mg, generic to Flomax®,
infringes Astellas’ patent. After filing our answer and counterclaim, we filed a
motion for summary judgment of patent invalidity. The District Court scheduled a
hearing on claim construction for May 2008 and summary judgment for June 2008.
Purdue Pharma Products L.P., et al. v. Impax Laboratories, Inc. (Tramadol)
In August 2008, Purdue Pharma Products L.P., Napp Pharmaceutical Group LTD.,
Biovail Laboratories International, SRL, and Ortho-McNeil-Janssen
Pharmaceuticals, Inc. (collectively “Purdue”) filed suit against us in the U.S.
District Court for the District of Delaware, alleging patent infringement for
the filing of our ANDA relating to Tramadol Hydrochloride Extended Release
Tablets, 100 mg, generic to 100mg Ultram® ER. We have filed an answer and
counterclaims seeking declaratory judgment of patent non-infringement and
invalidity. In November 2008, Purdue asserted additional infringement claims
with respect to our amended ANDA, which added 200 mg and 300 mg strengths of the
product. We have filed an answer and counterclaims. Discovery is in the early
stages, and no trial date has been set.
Eli Lilly and Company vs. Impax Laboratories, Inc. (Duloxetine)
In November 2008, Eli Lilly and Company filed suit against us in the United
States District Court for the Southern District of Indiana, alleging patent
infringement for the filing of our ANDA relating to Duloxetine Hydrochloride
Delayed Release Capsules, 20 mg, 30 mg, and 60 mg, generic to Cymbalta®. We are
preparing our answer to the complaint.

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Warner Chilcott, Ltd. et.al. v. Impax Laboratories, Inc. (Doryx)
In December 2008, Warner Chilcott Limited announced that one of its subsidiaries
and Mayne Pharma International Pty. Ltd. had sued us in the District Court for
the District of New Jersey for infringement of Mayne’s U.S. Patent No. 6,958,161
which covers Doryx, a tetracycline-class oral antibiotic. Although we have not
yet been served or viewed the actual complaint in this matter, Warner Chilcott
has announced that the lawsuit is in response to the submission of our ANDA
requesting approval to manufacture and sell generic versions of DORYX 100 and 75
mg delayed-release tablets prior to the expiration in 2022 of the ‘161 Patent.
We believe that we have defenses to the claims based on non-infringement and
invalidity and intend to vigorously defend ourselves from this claim.
Other Litigation Related to Our Business
Axcan Scandipharm Inc. v. Ethex Corp, et al. (Lipram UL).
In May 2007, Axcan Scandipharm Inc., a manufacturer of the Ultrase® line of
pancreatic enzyme products, brought suit against us in the U.S. District Court
for the District of Minnesota, alleging that we engaged in false advertising,
unfair competition, and unfair trade practices under federal and Minnesota law
in connection with the marketing and sale of our now-discontinued Lipram-UL
products. The suit seeks actual and consequential damages, including lost
profits, treble damages, attorneys’ fees, injunctive relief and declaratory
judgments that would prohibit the substitution of Lipram-UL for prescriptions of
Ultrase®. The Court granted in part and denied in part our motion to dismiss the
complaint, as well as that of co-defendants Ethex Corp. and KV Pharmaceutical
Co., holding that any claim of false advertising pre-dating June 1, 2001, is
barred by the statute of limitations. We have answered the complaint, and
discovery is proceeding.
Securities Litigation
We, our CEO and several former officers and directors are also defendants in
several class actions filed in the United States District Court for the Northern
District of California, all of which have since been consolidated into a single
action. These actions, brought on behalf of all purchasers of our stock between
May 5 and November 3, 2004, seek unspecified damages and allege that Impax and
the individual defendants, in violation of the antifraud provisions of the
federal securities laws, artificially inflated the market price of the stock
during this period by filing false financial statements for the first and second
quarters of 2004, based upon the subsequent restatement of its results for those
periods. The court twice granted our motions to dismiss the complaint, both
times with leave to amend, but denied our motion to dismiss the fourth amended
complaint as well as two motions for reconsideration. In August 2008, we filed
with the U.S. Court of Appeals for the Ninth Circuit a petition for a writ of
mandamus directing the district court to dismiss the complaint. Subsequently, we
have reached an agreement in principle with the plaintiffs to settle this
lawsuit. Upon the terms agreed upon, the plaintiffs are to receive $9 million.

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3. Schedule 8.15 to the Information Certificate is amended to include the
following agreement in its table of Material Contracts:

          Agreement   Parties   Date
Joint Development Agreement
  MEDICIS PHARMACEUTICAL
CORPORATION   November 26, 2008
 
       
 
  IMPAX LABORATORIES, INC.    

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