Exhibit 10.3


AMENDMENT
TO CREDIT AGREEMENT


This AMENDMENT TO
CREDIT AGREEMENT (“Amendment”) is entered into as of May 17, 2006,
by USANA HEALTH SCIENCES, INC., a Utah corporation (together with its
successors, “Borrower”), and BANK OF AMERICA, N.A., a national banking
association (together with its successors and assigns, “Bank”).


RECITALS


A.            Borrower and Bank are parties to
that certain Credit Agreement dated as of June 16, 2004, as amended by
that certain Waiver and Amendment to Credit Agreement dated as of
February 2, 2006 (as the same may be amended, modified or extended from
time to time the “Credit Agreement”) and the related Loan Documents
described therein.


B.            Pursuant to the terms of the Credit
Agreement, Bank has made and does make available to Borrower a revolving line
of credit in the amount of $10,000,000, which revolving line of credit
terminates on May 30, 2006.


C.            Borrower has requested that Bank
increase the amount of the revolving line of credit to $25,000,000, extend its
termination to May 30, 2011 and to make certain other modifications to the
Credit Agreement, which Bank has agreed to do on the terms and conditions set
forth in this Amendment.


NOW,
THEREFORE, in consideration of the foregoing, the mutual
covenants and agreements herein contained, and for other good and valuable
consideration receipt of which is hereby acknowledged, Borrower and Bank hereby
agree as follows:


1.             Definitions; Interpretation.  All capitalized terms used in this Amendment
and not otherwise defined herein have the meanings specified in the Credit
Agreement.  The rules of construction and
interpretation specified in Sections 1.02 and 1.05 of the
Credit Agreement also apply to this Amendment and are incorporated herein by
this reference.


2.             Amendments to Credit Agreement.  The Credit Agreement is amended as follows:


(a)           Amendment to Definitions.  In Section 1.01, amendments are
made to the definitions, as follows:


(i)            Applicable
Rate.  The definition of “Applicable
Rate” is amended and restated to read as follows:


“Applicable Rate”
means, from time to time, the following percentages per annum (a) in
respect of the Commitment fee, 0.20%, (b) in respect of Eurodollar Rate
Loans, the Eurodollar Rate plus 1.00%, (c) in respect of Base Rate
Loans, the Base Rate minus 0.50% and (d) in respect of the Letter
of Credit fee for standby Letters of Credit, 1.00%.


(ii)           Commitment.  The definition of “Commitment” is amended and
restated to read as follows:


“Commitment” means
the obligation of Bank to make Loans and L/C Credit Extensions hereunder in an
aggregate principal amount at any one time not to exceed $25,000,000, as such
amount may be adjusted from time to time in accordance with this Agreement.


(iii)          Consolidated
Funded Debt.  The definition of “Consolidated
Funded Debt” is added to read as follows:



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“Consolidated Funded
Debt” means, as of any date of determination, for Borrower and its
Subsidiaries on a consolidated basis, the sum of (a) the outstanding
principal amount of all obligations, whether current or long-term, for borrowed
money (including Obligations hereunder) and all obligations evidenced by bonds,
debentures, notes, loan agreements or other similar instruments, plus
(b) all purchase money Indebtedness, plus (c) all direct
obligations arising under letters of credit (including standby and commercial),
bankers’ acceptances, bank guaranties, surety bonds and similar instruments, plus
(d) all obligations in respect of the deferred purchase price of property
or services (other than trade accounts payable in the ordinary course of
business), plus (e) Attributable Indebtedness in respect of capital
leases and Synthetic Lease Obligations, plus (f) without
duplication, all Guarantees with respect to outstanding Indebtedness of the
types specified in clauses (a) through (e) above of Persons other than Borrower
or any Subsidiary, plus (g) all Indebtedness of the types referred
to in clauses (a) through (f) above of any partnership or joint venture (other
than a joint venture that is itself a corporation or limited liability company)
in which Borrower or a Subsidiary is a general partner or joint venturer,
unless such Indebtedness is expressly made non-recourse to Borrower or such
Subsidiary, minus (h) the aggregate amount of Subordinated
Liabilities properly classified on such date as long term debt in accordance
with GAAP.


(iv)          Consolidated
Funded Debt to EBITDA Ratio.  The
definition of “Funded Debt to EBITDA Ratio” is added to read as follows:


“Consolidated Funded
Debt to EBITDA Ratio” means, as of any date of determination, the ratio of
(a) Consolidated Funded Debt as of such date to (b) Consolidated
EBITDA for the period of the four prior fiscal quarters ending on such date.


(v)           Consolidated
Leverage Ratio.  The definition of “Consolidated
Leverage Ratio” is deleted.


(vi)          Consolidated
Tangible Net Worth.  The definition
of “Consolidated Tangible Net Worth” is deleted.


(vii)         Consolidated
Total Liabilities.  The definition of
“Consolidated Total Liabilities” is deleted.


(viii)        Interest
Payment Date.  In the definition of “Interest
Payment Date,” the phrase “provided, however, that if any
Interest Period for a Eurodollar Rate Loan exceeds three months, the respective
dates that fall every three months after the beginning of such Interest Period
shall also be Interest Payment Dates;” is added at the end of clause (a).


(ix)           Interest
Period.  In the definition of “Interest
Period,” the phrase “one, two or three months” is amended and restated to read “one,
two, three or six months.”


(x)            Letter
of Credit Sublimit.  The definition
of “Letter of Credit Sublimit” is amended and restated to read as follows:


“Letter of Credit
Sublimit” means an amount equal to $10,000,000.  The Letter of Credit Sublimit is part of, and
not in addition to, the Commitment.


(xi)           Maturity
Date.  The definition of “Maturity
Date” is amended and restated to read as follows:


“Maturity Date”
means May 30, 2011.



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(b)           Addition of Section 2.11.  Section 2.11 is hereby added to
read as follows:


2.11        Increase in Commitment.


(a)           Request for Increase.  Provided there exists no Default, upon notice
to Bank, Borrower may from time to time, request an increase in the Commitment
by an amount (for all such requests) not exceeding $15,000,000; provided
that any such request for an increase shall be in a minimum amount of $5,000,000
or a whole multiple of $1,000,000 in excess thereof.  At the time of sending such notice, Borrower
shall specify the time period within which Bank is requested to respond (which
shall in no event be less than ten Business Days from the date of delivery of
such notice to Bank).


(b)           Bank Election to Increase;
Effective Date.  Bank shall notify
Borrower within such time period whether or not it agrees to increase the
Commitment.  In the event Bank does not
respond within such time period, the Bank shall be deemed to have declined to
increase the Commitment.  If the
Commitment is increased in accordance with this Section, Bank and Borrower
shall determine the effective date (the “Increase Effective Date”).


(c)           Conditions to Effectiveness of
Increase.  As a condition precedent
to such increase, Borrower shall deliver to Bank a certificate of each Loan
Party dated as of the Increase Effective Date signed by a Responsible Officer
of such Loan Party (i) certifying and attaching the resolutions adopted by
such Loan Party approving or consenting to such increase, and (ii) in the
case of Borrower, certifying that, before and after giving effect to such
increase, (A) the representations and warranties contained in Article V
and the other Loan Documents are true and correct on and as of the Increase
Effective Date, except to the extent that such representations and warranties
specifically refer to an earlier date, in which case they are true and correct
as of such earlier date, and except that for purposes of this Section 2.11,
the representations and warranties contained in subsections (a) and (b) of
Section 5.05 shall be deemed to refer to the most recent statements
furnished pursuant to clauses (a) and (b), respectively, of Section 6.01,
and (B) no Default exists.


(c)           Amendments to Section 6.12.  Section 6.12 is hereby amended
and restated to read as follows:


6.12        Financial Covenants.


(a)           Maximum Funded Debt to EBITDA
Ratio.  Maintain, as of the end of
each fiscal quarter of Borrower, a Consolidated Funded Debt to EBITDA Ratio,
equal to or less than 2.5 to 1.0.


(b)           Minimum EBITDA.  Maintain on a consolidated basis, as of the
end of each fiscal quarter of Borrower, for the period of the four prior fiscal
quarters ending on such date, Consolidated EBITDA equal to or greater than
Thirty Million Dollars ($30,000,000).


(d)           Amendments to Section 9.17.  In the first sentence of subsection (b) of Section 9.17,
the reference to “JAMS/ENDISPUTE, LLC, a Delaware limited liability company or
any successor thereof” is amended and restated to be a reference to “American
Arbitration Association or any successor thereof” and the definition of and
each reference to the term “JAMS” is amended and restated to be a reference to “AAA.”


3.             Amendments to Note.  In the heading of the Note,
the reference to the amount of $10,000,000 is amended and restated to be a
reference to the amount of $25,000,000 and in the first



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paragraph of the Note, the reference to the amount of
Ten Million Dollars ($10,000,000) is amended and restated to be a reference to
the amount of Twenty-five Million Dollars ($25,000,000).


4.             Conditions to Effectiveness.  Notwithstanding anything contained herein to
the contrary, this Amendment shall become effective when each of the following
conditions is fully and simultaneously satisfied; provided that each
such condition is fully and simultaneously satisfied on or before May 30,
2006:


(a)           Delivery of Amendment.  Borrower and Bank shall have executed and
delivered counterparts of this Amendment to each other;


(b)           Payment of Fees.  Borrower shall have paid to Bank an amendment
fee in the amount of Twenty-five Thousand Dollars ($25,000) in respect of Bank’s
agreement to enter into this Amendment;


(c)           Confirmation of Guarantors.  Each Guarantor shall have executed and
delivered to Bank a Consent of Guarantors in the form of Annex 1 hereto;


(d)           Representations True; No Default.  The representations of Borrower as set forth
in Article V of the Credit Agreement shall be true on and as of the
date of this Amendment with the same force and effect as if made on and as of
this date or, if any such representation or warranty is stated to have been
made as of or with respect to a specific date, as of or with respect to such
specific date.  No Event of Default and
no event which, with notice or lapse of time or both, would constitute an Event
of Default, shall have occurred and be continuing or will occur as a result of
the execution of this Amendment; and


(e)           Other Documents.  Bank shall have received such other
documents, instruments, and undertakings as Bank may reasonably request.


5.             Representations and Warranties.  Borrower hereby represents and warrants to
Bank that each of the representations and warranties set forth in Article V
of the Credit Agreement is true and correct as if made on and as of the date of
this Amendment or, if any such representation or warranty is stated to have
been made as of or with respect to a specific date, as of or with respect to
such specific date.  Borrower expressly agrees
that it shall be an additional Event of Default under the Credit Agreement if
any representation or warranty made by the Borrower hereunder shall prove to
have been incorrect in any material respect when made.


6.             No Further Amendment.  Except as expressly modified by this
Amendment, the Credit Agreement and the other Loan Documents shall remain
unmodified and in full force and effect and the parties hereby ratify their
respective obligations thereunder.


7.             Reservation of Rights.  Borrower acknowledges and agrees that the
execution and delivery by Bank of this Amendment shall not be deemed to create
a course of dealing or otherwise obligate Bank to forbear or execute similar
amendments under the same or similar circumstances in the future.


8.             Miscellaneous.


(a)           Governing Law.  THIS AMENDMENT SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF WASHINGTON; PROVIDED
THAT BANK SHALL RETAIN ALL RIGHTS ARISING UNDER FEDERAL LAW.


(b)           Counterparts.  This Amendment may be executed in one or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.



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(c)           Integration.  This Amendment, together with the other Loan
Documents, comprises the complete, final and integrated agreement of the
parties on the subject matter hereof and thereof and supersedes all prior
agreements, written or oral, on such subject matter.


(d)           Severability.  Any provision of this Amendment that is
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions thereof, and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.


(e)           Oral Agreements.  ORAL AGREEMENTS OR ORAL
COMMITMENTS TO LOAN MONEY, EXTEND CREDIT OR TO FORBEAR FROM ENFORCING REPAYMENT
OF A DEBT ARE NOT ENFORCEABLE UNDER WASHINGTON LAW.


IN
WITNESS WHEREOF, Borrower and Bank have caused this Amendment
to be duly executed as of the date first above written.


 


	
   

  	
  USANA HEALTH SCIENCES, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Gilbert A.
  Fuller

  
	
   

  	
  Name:

  	
  Gilbert A.
  Fuller

  	
   

  
	
   

  	
  Title:

  	
  Exec. Vice Pres.
  and CFO

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  BANK OF
  AMERICA, N.A.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Mark N.
  Crawford

  	
   

  
	
   

  	
  Name:

  	
  Mark N. Crawford

  	
   

  
	
   

  	
  Title:

  	
  Senior Vice
  President

  	
   

  
						



 


 



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ANNEX 1


CONSENT
OF GUARANTORS


This CONSENT OF
GUARANTORS (this “Consent”) is entered into as of May 17, 2006, by
USANA ACQUISITION CORP., a Utah corporation (“USANA Acquisition”),
WASATCH PRODUCT DEVELOPMENT, INC., a Utah corporation (“Wasatch”), USANA
HEALTH SCIENCES NEW ZEALAND, INC., a Delaware corporation (“USANA New
Zealand”), USANA CANADA HOLDING, INC., a Delaware corporation (“USANA
Canada”), FMG PRODUCTIONS, INC., a Utah corporation (“FMG”),
INTERNATIONAL HOLDINGS, INC., a Delaware corporation (“Holdings” and
together with USANA Acquisition, Wasatch, USANA New Zealand, USANA Canada, FMG
and their respective successors, collectively, the “Guarantors” and
individually, a “Guarantor”), for the benefit of BANK OF AMERICA, N.A.,
a national banking association (together with its successors and assigns, “Bank”).


RECITALS


A.            USANA HEALTH SCIENCES, INC., a Utah
corporation (together with its successors, “Borrower”), and Bank are
parties to that certain Credit Agreement dated as of June 16, 2004, as
amended by that certain Waiver and Amendment to Credit Agreement dated as of
February 2, 2006 (as the same may be amended, modified or extended from
time to time the “Credit Agreement”). 
Capitalized terms not otherwise defined in this Amendment shall have the
meanings given in the Credit Agreement.


B.            In connection with and as a
condition to the obligation of Bank to make its initial Credit Extension under
the Credit Agreement, each Guarantor entered into that certain Continuing
Guaranty dated as of June 16, 2004 (as amended, restated, extended,
supplemented or otherwise modified from time to time, the “Guaranty”),
pursuant to which each Guarantor guaranteed, among other things, the payment
and performance of the debts, liabilities, obligations, covenants and duties of,
Borrower to Bank arising under the Credit Agreement and the other Loan
Documents.


C.            Borrower and Bank intend to enter
into that certain Amendment to Credit Agreement dated as of May 17, 2006
(the “Amendment”), pursuant to which Bank will increase the amount of
the revolving line of credit made available to Borrower under the Credit
Agreement to $25,000,000, extend its termination to May 30, 2011 and to
make certain other modifications to the Credit Agreement.


D.            It is a condition precedent to the
effectiveness of the Amendment that each Guarantor enter into this Consent.


NOW
THEREFORE, in consideration of the foregoing, and for other
good and valuable consideration receipt of which is hereby acknowledged, each
Guarantor agrees as follows:


AGREEMENT


1.             Consent.  Each Guarantor hereby acknowledges that it
has received a copy of the Amendment and hereby consents to its contents,
including all prior and current amendments to the Credit Agreement
(notwithstanding that such consent is not required).


2.             Ratification and Confirmation.  Each Guarantor hereby ratifies and confirms
each of its debts, liabilities, obligations, covenants and duties to Bank
arising under the Guaranty and the other Loan Documents to which such Guarantor
is a party.  Each Guarantor hereby
confirms that its guarantee of the payment and performance of the Guaranteed
Obligations (as defined in the Guaranty) remains in full force and effect, and
that the Guaranteed Obligations (as defined in the Guaranty) shall include the
debts, liabilities, obligations, covenants and duties of, Borrower to Bank
arising under the Credit Agreement and the other Loan Documents as amended by
the Amendment and the documents, instruments and agreements contemplated
thereby.



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3.             Representations and Warranties.  Each Guarantor hereby represents and warrants
to Bank that each of the representations and warranties set forth in Section 28
of the Guaranty Agreement is true and correct as if made on and as of the date
of this Consent.


4.             Governing Law.  THIS CONSENT SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF WASHINGTON; PROVIDED
THAT BANK SHALL RETAIN ALL RIGHTS ARISING UNDER FEDERAL LAW.


5.             Severability.  Any provision of this Consent that is
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions thereof, and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render unenforceable
such provision in any other jurisdiction.


6.             Oral Agreements.  ORAL AGREEMENTS OR ORAL
COMMITMENTS TO LOAN MONEY, EXTEND CREDIT OR TO FORBEAR FROM ENFORCING REPAYMENT
OF A DEBT ARE NOT ENFORCEABLE UNDER WASHINGTON LAW.


IN
WITNESS WHEREOF, each Guarantor has caused this Consent to be
duly executed as of the date first above written.


 




	
  

  	
  USANA
  ACQUISITION CORP.

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Gilbert A. Fuller

  
	
   

  	
  Name:

  	
  Gilbert A. Fuller

  
	
   

  	
  Title:

  	
  Treasurer

  
	
   

  	
   

  	
   

  
	
   

  	
  WASATCH
  PRODUCT DEVELOPMENT, INC.

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Gilbert A.
  Fuller

  
	
   

  	
  Name:

  	
  Gilbert A. Fuller

  
	
   

  	
  Title:

  	
  Treasurer

  
	
   

  	
   

  	
   

  
	
   

  	
  USANA
  HEALTH SCIENCES NEW ZEALAND, INC.

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Gilbert A.
  Fuller

  
	
   

  	
  Name:

  	
  Gilbert A. Fuller

  
	
   

  	
  Title:

  	
  Treasurer

  






 



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  USANA
  CANADA HOLDING, INC.

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Gilbert A.
  Fuller

  
	
   

  	
  Name:

  	
  Gilbert A. Fuller

  
	
   

  	
  Title:

  	
  Secretary

  
	
   

  	
   

  	
   

  
	
   

  	
  FMG
  PRODUCTIONS, INC.

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Gilbert A.
  Fuller

  
	
   

  	
  Name:

  	
  Gilbert A. Fuller

  
	
   

  	
  Title:

  	
  V.P. and Treasurer

  
	
   

  	
   

  	
   

  
	
   

  	
  INTERNATIONAL
  HOLDINGS, INC.

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Mitchell
  Walkington

  
	
   

  	
  Name:

  	
  Mitchell Walkington

  
	
   

  	
  Title:

  	
  Secretary and Treasurer

  






 



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