Exhibit 10.3
Execution Copy
AMENDED AND RESTATED
SUBORDINATED PROMISSORY NOTE
THIS INSTRUMENT AND THE RIGHTS AND OBLIGATIONS EVIDENCED HEREBY ARE SUBORDINATE
IN THE MANNER AND TO THE EXTENT SET FORTH IN THAT CERTAIN AMENDED AND RESTATED
SUBORDINATION AGREEMENT (AS AMENDED, RESTATED, MODIFIED OR REPLACED FROM TIME TO
TIME, THE "SUBORDINATION AGREEMENT") DATED AS OF AUGUST 17, 2009, AMONG THE JOHN
N. KAPOOR TRUST DATED SEPTEMBER 20, 1989, AKORN, INC. ("AKORN"), AKORN (NEW
JERSEY), INC. ("AKORN NEW JERSEY" AND TOGETHER WITH AKORN, THE "COMPANIES", AND
EACH A "COMPANY"), AND EJ FUNDS, LP ("AGENT"), TO THE INDEBTEDNESS (INCLUDING
INTEREST) OWED BY THE COMPANIES PURSUANT TO THAT CERTAIN CREDIT AGREEMENT DATED
AS OF JANUARY 9, 2009 AMONG THE COMPANIES, GENERAL ELECTRIC CAPITAL CORPORATION,
AS A LENDER AND AS AGENT FOR THE LENDERS ("GE CAPITAL") AND THE LENDERS FROM
TIME TO TIME PARTY THERETO, AS SUCH CREDIT AGREEMENT HAS BEEN (I) ASSIGNED BY GE
CAPITAL AND THE OTHER LENDERS A PARTY THERETO TO EJ FUNDS LP, AS AGENT AND
LENDER PURSUANT TO AN ASSIGNMENT AGREEMENT DATED AS OF MARCH 31, 2009,
(II) AMENDED PURSUANT TO A MODIFICATION WARRANT AND INVESTOR RIGHTS AGREEMENT
DATED AS OF THE APRIL 13, 2009 AMONG THE COMPANIES AND EJ FUNDS LP, AS AGENT AND
LENDER, AS FURTHER AMENDED AND RESTATED BY THE (III) AMENDED AND RESTATED CREDIT
AGREEMENT DATED AS OF AUGUST [•], 2009 AMONG THE COMPANIES AND EJ FUNDS LP, AS
AGENT AND LENDER, AND (IV) HEREAFTER MAY BE AMENDED, RESTATED, SUPPLEMENTED OR
OTHERWISE MODIFIED FROM TIME TO TIME AND TO INDEBTEDNESS REFINANCING THE
INDEBTEDNESS UNDER THAT AGREEMENT AS CONTEMPLATED BY THE SUBORDINATION
AGREEMENT; AND EACH HOLDER OF THIS INSTRUMENT, BY ITS ACCEPTANCE HEREOF,
IRREVOCABLY AGREES TO BE BOUND BY THE PROVISIONS OF THE SUBORDINATION AGREEMENT.
THIS SUBORDINATED PROMISSORY NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED (THE "ACT"), OR THE SECURITIES LAWS OF ANY STATE OR
OTHER JURISDICTION, AND MAY NOT BE OFFERED, SOLD, ENCUMBERED OR OTHERWISE
TRANSFERRED, EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE
ACT AND SUCH STATE SECURITIES LAWS, OR AN EXEMPTION FROM REGISTRATION
THEREUNDER.
US $5,853,266.68 (includes all accrued interest through the date hereof)
August 17, 2009
FOR VALUE RECEIVED, AKORN, INC., a Louisiana corporation ("Akorn") and
AKORN (NEW JERSEY), INC., an Illinois corporation ("Akorn New Jersey") and
collectively with Akorn, the "Makers" and each a "Maker"), hereby promise
jointly and severally to pay to the order of THE JOHN N. KAPOOR TRUST DATED
SEPTEMBER 20, 1989, or its permitted successors or assigns ("Payee"), the
aggregate principal sum equal to $5,853,266.68 (equal to the sum of (i) the
stated principal amount outstanding of the Prior Note (as defined below) of Five
Million Dollars ($5,000,000), (ii) $804,892.58 of outstanding accrued but unpaid
interest under the Prior Note as of its stated date of maturity and (iii)
$48,374.10 of additional outstanding accrued but unpaid interest arising from
and after the stated date of maturity of the Prior Note through and including
the date hereof), on the terms and conditions