Exhibit 10.1e

 

AMENDMENT NO. 3 TO THE

CREDIT AGREEMENT

Dated as of December 18, 2003

AMENDMENT NO. 3 TO THE CREDIT AGREEMENT among ALPHARMA INC., a Delaware corporation ("***Holdings*"), the banks, financial institutions and other lenders party hereto, and BANK OF AMERICA, as administrative agent and collateral agent (the "***Administrative Agent*"), as parties to the Credit Agreement referred to below.**PRELIMINARY STATEMENTS:**
(1)   Alpharma Operating Corporation, a Delaware corporation (the "***Company*"), Alpharma USPD Inc., a Maryland corporation (together with the Company and the Subsidiary Borrowers party thereto, the "***Borrowers*"), Holdings, the Lender Parties and the Administrative Agent have entered into a Credit Agreement dated as of October 5, 2001, as amended by Amendment No. 1 dated as of December 16, 2002 and Amendment No. 2 dated as of April 3, 2003 (as further amended, supplemented or otherwise modified from time to time, the "***Credit Agreement*").  Capitalized terms not otherwise defined in this Amendment have the same meanings as specified in the Credit Agreement.
(2)   Holdings and the Required Lenders have agreed to amend the Credit Agreement as hereinafter set forth.

SECTION 1.   Amendments to Credit AgreementThe Credit Agreement is, effective as of the date hereof and subject to the satisfaction of the conditions precedent set forth in Section 3, hereby amended as follows:

(a)       Article I is amended by adding the following new terms in alphabetical order:

"Alpharma Sales" means each of the (i)**********, (ii)**********, (iii)*********, (iv)********, (v) Other Sales and (vi) Wynco Sale.

"Amendment No. 3 Effective Date" means the date on which Amendment No. 3 to the Credit Agreement, dated as of December 18, 2003, among Holdings, the Administrative Agent and the Required Lenders, becomes effective pursuant to Section 3 thereof.

"********* Sale" means the sale, transfer or other disposition by Holdings or any of its Subsidiaries, in one transaction or series of related transactions, of all or any portion of the Equity Interests, properties, assets, rights or other interests constituting or related to ********************.

"********* Sale" means the sale, licensing, transfer or other disposition by Holdings or any of its Subsidiaries, in one transaction or series of related transactions, of all or any portion of the Equity Interests, properties, assets, rights or other interests constituting or related to ********************.

"******** Sale" means the sale, licensing, transfer or other disposition by Holdings or any of its Subsidiaries, in one transaction or series of related transactions, of all or any portion of the Equity Interests, properties, assets, rights or other interests constituting or related to ********************.

"*********Sale" means the sale, licensing, transfer or other disposition by Holdings or any of its Subsidiaries, in one transaction or series of related transactions, of all or any portion of the Equity Interests, properties, assets, rights or other interests constituting or related to ********************.

"Other Sales" means the sale, licensing, transfer or other disposition by Holdings or any of its Subsidiaries, in one transaction or series of related transactions, of all or any portion of the assets, rights or other interests specified on Schedule 5.02(e).

"Wynco Sale" means the sale, licensing, transfer or other disposition by Holdings or any of its Subsidiaries, in one transaction or series of related transactions, of all or any portion of the Equity Interests, properties, assets, rights or other interests constituting or related to the business conducted by Wynco LLC.

(b)      The definition of "Consolidated EBITDA" in Article I is amended by inserting after clause (l) therein a new clause to read as follows:

"*plus* (m) all reasonable cash expenses and charges of Holdings or any of its Subsidiaries incurred within 18 months after the Amendment No. 3 Effective Date in connection with any Alpharma Sales *plus* (n) all cash restructuring charges up to a maximum aggregate amount of $10,000,000 incurred from October 1, 2003 through December 31, 2004 in connection with employee headcount reductions or facility closures related to such headcount reductions.

(c)      The definition of  "Excess Cash Flow" in Article I is amended by inserting after the word "Agreement" within the parenthetical in clause "(c)" therein a new clause to read as follows:     ", but excluding amounts expended constituting Net Cash Proceeds from the Alpharma Sales". 

(d)      The definition of "Specified Sales" in Article I is amended by deleting clause (iv) therein, and relabeling existing clause (v) as new clause (iv).  

(e)      Section 2.06(b)(ii) is amended by inserting at the end of the first sentence thereof a new clause to read as follows:

"; *provided* further that, with respect to all Net Cash Proceeds received from time to time by Holdings or any of its Subsidiaries from one or more of the Alpharma Sales, the Company shall, subject to Sections 2.06(b)(vii) and (viii), within ten (10) Business Days of receipt of any such proceeds, prepay an aggregate principal amount of the Advances equal to (1) 100% of the first $100,000,000 of aggregate Net Cash Proceeds so received, (2) 50% of all aggregate Net Cash Proceeds so received that are greater than $100,000,000, but less than or equal to $400,000,000 and (3) 25% of all aggregate Net Cash Proceeds so received that are greater than $400,000,000, so long as, with respect to any Net Cash Proceeds that are retained by Holdings or any of its Subsidiaries pursuant to clauses (2) and (3) of this proviso but which are not reinvested in assets used or useful in the business of Holdings or any of its Subsidiaries (which reinvestment, for the avoidance of doubt, includes prepayment of Debt otherwise permitted hereunder) within 300 days after receipt, the Company shall prepay from time to time an aggregate principal amount of the Advances equal to the aggregate amount of such non-reinvested proceeds." 

(f)      Section 4.01 is amended by inserting at the end thereof a new subsection "(z)" to read as follows:

"  (z)  Tax Shelter Regulations.  No Loan Party intends to treat the Advances as being a "reportable transaction" (within the meaning of Treasury Regulation section 1.6011-4).  If any Loan Party determines to take any action inconsistent with such intention, Holdings will promptly notify the Administrative Agent thereof.  Each Loan Party acknowledges that the Administrative Agent and/or one or more of the Lenders may treat the Advances (including Letters of Credit) as part of a transaction that is subject to Treasury Regulation section 1.6011-4 or section 301.6112-1, and the Administrative Agent and such Lender or Lenders, as applicable, may file such IRS forms or maintain such lists and other records as they may determine is required by such Treasury Regulations."

(g)      Section 5.02(b)(iii) is amended by inserting at the end thereof a new subsection "(K)" to read as follows:

"  (K)  Debt in respect of any other Hedge Agreements that have an aggregate Agreement Value not in excess of $20,000,000 at any time outstanding."

(h)      Section 5.02(c) is amended by inserting at the end thereof a new clause to read as follows: 

"; *provided* that any Specified Sales or Alpharma Sales shall be permitted on the terms otherwise specified herein."

(i)      Section 5.02(d) is amended by inserting at the beginning thereof a new clause to read as follows: 

"Other than to effect an Alpharma Sale, ".

(j)      Section 5.02(e) is amended by inserting at the end thereof a new clause "(x)" to read as follows:

"  (x)  the Alpharma Sales, so long as (A) the purchase price (or licensing or other payments, as applicable) paid for any assets in such Alpharma Sale shall be paid to such Loan Party or such Subsidiary solely in cash and (B) on or prior to the date of the consummation of such Asset Sale, if such Asset Sale involves cash payments by the purchaser in excess of ***********, Holdings shall deliver to the Administrative Agent a certificate of a Responsible Officer certifying that such transaction has been approved by the Board of Directors of Holdings and, with respect to any such transaction or series of related transactions involving aggregate payments in excess of $25,000,000, an opinion as to the fairness of such transaction to the applicable Loan Party or Subsidiary from a financial point of view issued by an investment banking firm, accounting firm or appraisal firm of national standing (or, with respect to any sale of real property involving aggregate payments in excess of $25,000,000, a real estate appraisal in customary form); *provided* that, for the avoidance of doubt, the purchase price in any Alpharma Sale shall be deemed to be paid solely in cash where such purchase price consists solely of cash, but a Loan Party or its Subsidiary retains any liability related to any assets sold or the purchaser of any assets sold assumes any liability related to such assets."

(k)      Section 5.02(f) is amended by inserting at the end thereof a new clause "(xi)" to read as follows:

"  (xi)  the purchase by Alpharma Animal Health Company of the 50% interest in Wynco LLC not owned by such Subsidiary on the Amendment No. 3 Effective Date."

(l)      Section 5.02(j) is amended by inserting at the end thereof a new clause "(vii)" to read as follows:

"(vii)  the repayment, prepayment or redemption of the October Convertible Notes with the Net Cash Proceeds of any Alpharma Sales not required to be applied to prepay Advances pursuant to Section 2.06(b)(ii); *provided* that at the time of any such repayment, prepayment or redemption of the October Convertible Notes, the Senior Secured Leverage Ratio shall be less than or equal to 1.50:1.00 (calculated on a *pro forma* basis using Senior Debt as of such date of determination and Consolidated EBITDA of Holdings and its Subsidiaries as specified in the Required Financial Information most recently delivered to the Administrative Agent pursuant to Section 5.03)." 

(m)      Section 5.02(o) is amended by deleting the amount "100,000,000" specified for the Fiscal Year ending in 2004 in the table therein, and substituting the amount "75,000,000" therefor.

(n)      Section 5.03 is amended by inserting at the end thereof a new subsection "(s)" to read as follows:

"  (s)  Tax Shelter Regulations.  Promptly after Holdings has notified the Administrative Agent of any intention by any Loan Party to treat the Advances as being a "reportable transaction" (within the meaning of Treasury Regulation section 1.6011-4), a duly completed copy of IRS Form 8886 or any successor form."

(o)      Section 5.04(a) is amended in full to read as follows:

"(a)      Total Leverage Ratio.  Maintain at the end of each Fiscal Quarter of Holdings a Total Leverage Ratio of not more than the amount set forth below for each period set forth below:

**Measurement Period **Ratio
December 31, 2001 to September 30, 2002**************