Document:

Exhibit 10.29

 

LENDER JOINDER AND FIRST AMENDMENT TO CREDIT AGREEMENT

 

This LENDER JOINDER AND FIRST AMENDMENT TO CREDIT AGREEMENT (the “Amendment”) is made as of April 21, 2015 (the “First Amendment Effective Date”), by and among LANNETT COMPANY, INC., a Delaware corporation (the “Borrower”), the various financial institutions party hereto (collectively, the “Lenders”), and CITIBANK, N.A., a national banking association (“Citibank”), as administrative agent (in such capacity, the “Administrative Agent”) for the Lenders, and is acknowledged by the Borrower’s subsidiaries party hereto in their capacity as Guarantors.

 

BACKGROUND

 

A.    Pursuant to that certain Credit Agreement entered into on December 18, 2013, by and among the Borrower, the lenders party thereto (the “Existing Lenders”) and the Administrative Agent (the “Credit Agreement”), the Existing Lenders agreed, inter alia, to extend to the Borrower a $50,000,000 revolving credit facility;

 

B.            Pursuant to the terms hereof, Citizens Bank, N.A. and TriState Capital Bank (each a “New Lender”) are each becoming a Lender under the Credit Agreement as amended by this Amendment;

 

C.            Simultaneously herewith, Administrative Agent, Lenders, and Borrower have agreed to amend the Credit Agreement to, among other things, (i) increase the Revolving Credit Commitments (as defined in the Credit Agreement) from $50,000,000 to $120,000,000, (ii) to increase the accordion feature from $25,000,000 to $30,000,000, and (iii) make certain other modifications to the Credit Agreement, all subject to the terms and conditions hereof; and

 

D.            In connection with the above, the Borrower has appointed Citibank and PNC Bank, National Association as Joint Lead Arrangers and Joint Bookrunners;

 

NOW, THEREFORE, incorporating the Background section herein, and in consideration of the mutual promises contained herein, and for other good and valuable consideration, the receipt and legal sufficiency of which are hereby acknowledged, and intending to be legally bound hereby, the parties hereto agree as follows:

 

AGREEMENT

 

1.             Definitions.

 

(a)             Except as expressly set forth herein, all capitalized terms used and not defined herein shall have the respective meanings ascribed thereto in the Credit Agreement.

 

(b)             The following term is hereby added to Section 1.1 of the Credit Agreement:

 

 

“First Amendment” means that certain Lender Joinder and First Amendment to Credit Agreement dated as of April 21, 2015 by and among the Borrower, the Lenders, and the Administrative Agent.

 

(c)             The following terms set forth in Section 1.1 of the Credit Agreement are hereby amended and restated in their entirety as follows:

 

“Loan Documents” means, collectively, this Agreement, the First Amendment, the Notes (including, without limitation, the New Notes as defined in the First Amendment), the Letters of Credit, the Fee Letter, the Security Documents, each Assignment and Assumption, each Subordination Agreement and each other agreement, instrument or document executed and delivered pursuant to or in connection with this Agreement, the First Amendment and the other Loan Documents.

 

“Required Lenders” means, at the time any determination thereof is to be made, at least three Non-Defaulting Lenders holding more than 51% of the then aggregate unused Commitments and unpaid principal amount of the Notes and Letter of Credit Outstandings (excluding the Commitments and aggregate unpaid principal amount of Notes, Letter of Credit Outstandings and unused Commitments held by Defaulting Lenders); provided, however, if there is less than three Non-Defaulting Lenders, then such Non-Defaulting Lenders shall constitute Required Lenders.

 

“Revolving Loan Commitment Amount” means, on any date, $120,000,000, as such amount may, from time to time, be increased pursuant to Section 2.10 or reduced pursuant to Section 2.3, 8.2 or 8.3.

 

(d)   The definition of “Adjusted Eurodollar Rate” set forth in Section 1.1 of the Credit Agreement is hereby amended by adding the following sentence at the end of said definition: “Notwithstanding the foregoing, if the Adjusted Eurodollar Rate as determined under any method above would be less than zero (0), the Adjusted Eurodollar Rate shall be deemed to be zero (0).”

 

(e)             Paragraph (e) of the definition of “Permitted Acquisition” set forth in Section 1.1 of the Credit Agreement is hereby amended and restated in its entirety as follows:

 

(e)           (i) the aggregate amount of all acquisitions in any Fiscal Year shall not exceed $200,000,000; (ii) the amount of such individual acquisition shall not exceed $200,000,000, and (iii) the aggregate amount of all acquisitions during the term of the Revolving Loan Commitments shall not exceed $600,000,000;

 

2.             Amendment to Section 2.10.  The reference to “$25,000,000” in paragraph (a) of Section 2.10 of the Credit Agreement is hereby amended and restated in its entirety to read “$30,000,000”.

 

3.             Amendment to Section 7.2.4.  Paragraph (c) of Section 7.2.4 of the Credit Agreement is hereby amended and restated in its entirety to read as follows:

 

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(c)           Capital Expenditures, etc.

 

(i)            The Borrower will not, and will not permit any of its Subsidiaries to, make or commit to make Capital Expenditures at any time during any Fiscal Year, except Capital Expenditures which do not aggregate in such Fiscal Year in excess of the amount, at the time such expenditure is made, set forth opposite such Fiscal Year below based on the most recently reported Leverage Ratio (as further described below):

 

	
Fiscal Year End
    	
 
    	
Leverage Ratio < 1.5
    	
 
    	
Leverage Ratio > 1.5
    	
 
    
	
June 30, 2015
    	
 
    	
$
    	
83,000,000
    	
 
    	
$
    	
40,000,000
    	
 
    
	
June 30, 2016
    	
 
    	
$
    	
52,000,000
    	
 
    	
$
    	
40,000,000
    	
 
    
	
June 30, 2017
    	
 
    	
$
    	
52,000,000
    	
 
    	
$
    	
35,000,000
    	
 
    
	
June 30, 2018
    	
 
    	
$
    	
23,000,000
    	
 
    	
$
    	
23,000,000
    	
 
    
	
June 30, 2019
    	
 
    	
$
    	
41,000,000
    	
 
    	
$
    	
25,000,000
    	
 
    

 

; provided, however, that no such Capital Expenditure shall be made if any Default or Event of Default shall have occurred and be continuing immediately prior to or after giving effect to the making of any such Capital Expenditure.   The Leverage Ratio used to compute the permitted Capital Expenditure level above shall be the Leverage Ratio set forth in the Compliance Certificate most recently delivered by the Borrower to the Administrative Agent pursuant to Section 7.1.1(c); changes in the approved Capital Expenditure limitation set forth above resulting from a change in the Leverage Ratio shall become effective prospectively upon delivery by the Borrower to the Administrative Agent of a new Compliance Certificate pursuant to Section 7.1.1(c).  If the Borrower shall fail to deliver a Compliance Certificate as and when required pursuant to Section 7.1.1(c), the Leverage Ratio from the date of such required delivery to the date the Borrower actually delivers to the Administrative Agent such Compliance Certificate shall conclusively be presumed to be in excess of 1.5 to 1.0.

 

(ii)           Upon delivery of the Compliance Certificate for the last period of any Fiscal Year (each such Fiscal Year being referred to below as an “immediately preceding Fiscal Year”), commencing with the Fiscal Year ending June 30, 2015, the amount of Capital Expenditures set forth in Section 7.2.4(c)(i) in respect of the then immediately following Fiscal Year shall be increased (but not decreased) by an amount which would be equal to the unused availability to make Capital Expenditures for such immediately preceding Fiscal Year based on the Leverage Ratio reported on such Compliance Certificate or, thereafter, based on the Leverage Ratio reported on the most recent Compliance Certificate delivered pursuant to Section 7.1.1(c); provided, however, that such increase shall not exceed 33.3% of the amount of Capital Expenditures permitted for such immediately preceding Fiscal Year, again based on the Leverage Ratio set forth in such then current Compliance Certificate; provided further, however, that the amount of any Capital Expenditures incurred in any Fiscal Year shall be first

 

3

 

deducted from any amounts carried forward from the immediately preceding Fiscal Year pursuant to this Section 7.2.4(c)(ii).

 

(iii)          If, as a result of any change in the Leverage Ratio, the amount of Capital Expenditures permitted above for any Fiscal Year is reduced to an amount less than the amount of Capital Expenditures already made during such Fiscal Year in accordance with this Section, such reduction shall not result in an Event of Default, but no further Capital Expenditures shall be permitted during such Fiscal Year unless the Leverage Ratio decreases sufficiently at any following quarterly measurement period such that the limitation on Capital Expenditures is again increased to an amount in excess of the amount of such Capital Expenditures already made during such Fiscal Year.

 

4.             Joinder of New Lenders.

 

(a)           In consideration of Borrower and Administrative Agent consenting to each New Lender becoming a Lender under the Credit Agreement, each New Lender agrees that effective as of the date hereof it shall become, and shall be deemed to be, a Lender under the Credit Agreement and each of the Loan Documents and agrees that from the date hereof and so long as such New Lender remains a party to the Credit Agreement, such New Lender shall assume the obligations of a Lender under and perform, comply with and be bound by each of the provisions of the Credit Agreement which are stated to apply to a Lender and shall be entitled to the benefits, rights and remedies set forth therein and in the Credit Agreement and each of the Loan Documents.  Each New Lender hereby acknowledges that it has heretofore received a true and correct copy of the Credit Agreement and the Loan Documents (including any modifications thereof or supplements or waivers thereto) as in effect on the date hereof.

 

(b)           Each New Lender is executing and delivering this Amendment as of the date hereof and acknowledges that it shall: (i) share in accordance with its Pro Rata share in all Loans borrowed by Borrower on and after the date hereof; and  (ii) be deemed to have purchased a participation in any (A) outstanding Letter of Credit and each Reimbursement Obligation thereunder, in an amount equal to such New Lender’s Pro Rata share of the maximum amount available to be drawn under each such Letter of Credit and the amount of each such Reimbursement Obligation and (B) Swing Line Loan outstanding, in an amount equal to New Lender’s Ratable Share of such outstanding Swing Line Loan, and the participation of each other Lender in the foregoing shall be adjusted accordingly.

 

5.             Schedules to the Credit Agreement.   On the date hereof, Schedules I, II and III to the Credit Agreement are hereby amended and restated in their entirety by Schedules I, II and III to this Amendment.

 

6.             Revolving Loans. On the date hereof, (i) Borrower shall repay any Revolving Loans then outstanding and simultaneously reborrow a like amount of Revolving Loans from Lenders (including each New Lender) according to each Lender’s new Pro Rata share, and (ii) the Revolving Loan Commitments of each Lender shall be in the amounts set forth on Schedule II to the Credit Agreement.

 

4

 

7.             New Notes.  On the date hereof, Borrower shall deliver to Administrative Agent (a) an amended and restated Revolving Note in favor of each Lender other than each New Lender and a new Revolving Note in favor of each New Lender, each in the principal amount equal to such Lender’s new Revolving Loan Commitment (collectively the “New Notes”). Promptly thereafter, the Administrative Agent shall deliver to each Lender such Lender’s New Notes. In the case of the Revolving Note in favor of the Existing Lenders, such New Notes shall be in substitution for such Existing Lender’s existing Revolving Note.

 

8.             Representations and Warranties.  Each Loan Party hereby represents and warrants to Administrative Agent and Lenders that after giving effect to this Amendment:

 

(a)           The representations and warranties of the Loan Parties set forth in this Amendment and the Loan Documents are true and correct (i) in the case of representations and warranties qualified by materiality, in all respects and (ii) otherwise, in all material respects, in each case on and as of such date as if made on and as of such date (except to the extent that such representations and warranties relate to an earlier date in which case such representations and warranties that expressly relate to an earlier date are true and correct, in the case of such representations and warranties qualified by materiality, in all respects, and otherwise in all material respects, as of such earlier date);

 

(b)           This Amendment and the New Notes (i) have been duly and validly executed and delivered by each applicable Loan Party, and (ii) constitute, or will constitute, legal, valid and binding obligations of each applicable Loan Party which is or will be a party thereto, enforceable against such Loan Party in accordance with its terms except to the extent that enforceability may be limited by bankruptcy, insolvency, reorganization, moratorium or other similar laws affecting the enforcement of creditors’ rights generally or by laws or judicial decisions limiting the right of specific performance;

 

(c)           Neither the execution and delivery of this Amendment and the New Notes and any agreements contemplated hereby or thereby, nor the consummation of the transactions herein or therein contemplated or compliance with the terms and provisions hereof or thereof by any of them will conflict with, constitute a default under or result in any breach of (i) the terms and conditions of the certificate of incorporation, bylaws, certificate of formation, limited liability company agreement or other organizational documents of any Loan Party or (ii) any Law or any material agreement or instrument or order, writ, judgment, injunction or decree to which any Loan Party or any of its Subsidiaries is a party or by which it or any of its Subsidiaries is bound or to which it is subject, or result in the creation or enforcement of any Lien, charge or encumbrance whatsoever upon any property (now or hereafter acquired) of any Loan Party or any of its Subsidiaries (other than Liens granted under the Loan Documents);

 

(d)           No consent, approval, exemption, order or authorization of, or a registration or filing with, any official body or any other Person is required by any Law or any agreement in connection with the execution, delivery and carrying out of this Amendment and the New Notes and any agreements contemplated hereby or thereby, except for those consents, approvals, exemptions, orders, authorizations, registrations or filings that have been obtained or made;

 

5

 

(e)           No Event of Default or Default exists or is continuing; and

 

(f)            Since June 30, 2014, no Material Adverse Effect has occurred.

 

9.             Conditions Precedent.  The effectiveness of the amendments set forth herein is subject to the fulfillment, to the satisfaction of Administrative Agent and its counsel, of the following conditions precedent:

 

(a)           Loan Parties, Administrative Agent, and Lenders (as applicable) shall have delivered, or caused to be delivered, to Administrative Agent the following, all of which shall be in form and substance satisfactory to Administrative Agent and shall be duly completed and executed, if applicable:

 

(i)            This Amendment;

 

(ii)           The New Notes;

 

(iii)          A certificate dated the date hereof and signed by the Secretary or an Assistant Secretary of each of the Loan Parties, certifying as appropriate as to: (A) all action taken by each Loan Party in connection with this Amendment and the New Notes; (B) the names of the Authorized Officers authorized to sign this Amendment and the New Notes and each other document contemplated hereby or thereby, and their true signatures; and (C) the organizational documents of each Loan Party;

 

(iv)          Certificates from the appropriate state officials as to the continued existence and good standing of each Loan Party in each state where organized;

 

(v)           A certificate of each of the Loan Parties signed by an Authorized Officer, dated as of the date hereof stating that: (A) all representations and warranties of the Loan Parties set forth in this Amendment and the Loan Documents are true and correct (I) in the case of representations and warranties qualified by materiality, in all respects and (II) otherwise, in all material respects, in each case on and as of such date as if made on and as of such date (except to the extent that such representations and warranties relate to an earlier date in which case such representations and warranties that expressly relate to an earlier date are true and correct, in the case of such representations and warranties qualified by materiality, in all respects, and otherwise in all material respects, as of such earlier date); (B) no Event of Default or Default shall have occurred and be continuing; (C)  the making of the Loans or issuance, extension or increase of such Letter of Credit shall not contravene any Law applicable to any Loan Party or Subsidiary of any Loan Party; and (D) since June 30, 2014, there has been no Material Adverse Effect;

 

(vi)          The executed legal opinions of Fox Rothschild LLP, counsel to the Loan Parties, and Holland & Hart LLP, counsel to Cody Laboratories, Inc., in form and substance reasonably satisfactory to Administrative Agent which shall cover such matters incident to the transactions contemplated by this Amendment,

 

6

 

the New Notes and related agreements as Administrative Agent may reasonably require;

 

(vii)         Concurrently with the effectiveness of the amendments set forth herein, repayment of all outstanding Revolving Loans;

 

(viii)        All fees and expenses payable on or before the date hereof, as required by this Amendment, the Credit Agreement, or any other Loan Document or fee letter; and

 

(ix)          A fee letter with the Administrative Agent and such additional documents, certificates and information as Administrative Agent may require pursuant to the terms hereof or otherwise reasonably request;

 

(b)           All representations and warranties of the Loan Parties set forth in this Amendment and the Loan Documents are true and correct (i) in the case of representations and warranties qualified by materiality, in all respects and (ii) otherwise, in all material respects, in each case on and as of such date as if made on and as of such date (except to the extent that such representations and warranties relate to an earlier date in which case such representations and warranties that expressly relate to an earlier date are true and correct, in the case of such representations and warranties qualified by materiality, in all respects, and otherwise in all material respects, as of such earlier date);

 

(c)           No Event of Default or Default shall have occurred and be continuing as of the date hereof;

 

(d)           Since June 30, 2014, there has been no Material Adverse Effect;

 

(e)           The making of the Loans or issuance, extension or increase of any Letter of Credit shall not contravene any Law applicable to any Loan Party or Subsidiary of any Loan Party or any of the Lenders; and

 

(f)            Loan Parties shall have delivered to the Administrative Agent all material consents, regulatory approvals and licenses required to effectuate, and confirmation of an absence of any legal or regulatory prohibition with respect to, the financing contemplated hereby.

 

10.          Affirmations.

 

(a)           Each Loan Party hereby: (i) ratifies and affirms all the provisions of the Credit Agreement and the Loan Documents as supplemented and amended hereby, (ii) agrees that (except as expressly set forth in the Credit Agreement as amended hereby) the terms and conditions of the Credit Agreement and the Loan Documents, including the security provisions set forth therein, shall continue in full force and effect as supplemented and amended hereby, (iii) affirms and agrees that none of this Amendment, the New Notes or any other agreement executed in connection herewith or therewith shall constitute a novation, or complete or partial termination of the Obligations under the Credit Agreement and the Loan Documents as in effect prior to the date hereof and (iv) acknowledges and agrees that it has no defense, set-off,

 

7

 

counterclaim or challenge against the payment of any sums owing under the Credit Agreement and the Loan Documents or the enforcement of any of the terms or conditions thereof and agrees to be bound thereby and perform thereunder.

 

(b)           Without limiting the above, each Loan Party hereby acknowledges and confirms that the Collateral granted under the Credit Agreement and the Security Documents continues to secure the Obligations, including the Obligations arising under the Credit Agreement and evidenced by the New Notes.

 

11.          Ratification; References; No Waiver.  Except as expressly amended by this Amendment, the Credit Agreement and the Loan Documents shall continue to be, and shall remain, unaltered and in full force and effect in accordance with their terms and the execution, delivery and effectiveness of this Amendment shall neither operate as a waiver of any right, power or remedy of Administrative Agent or Lenders under the Credit Agreement or any of the Loan Documents nor constitute a waiver of any Default or Event of Default thereunder.  All references in the Credit Agreement to “this Agreement,” “hereof,” “hereto” and “hereunder” shall be deemed to be references to the Credit Agreement as amended hereby, and all references in any of the Loan Documents to the Credit Agreement shall be deemed to be to the Credit Agreement as amended hereby.

 

12.          Release.  Recognizing and in consideration of Lenders’ agreements set forth herein, each Loan Party hereby waives and releases Administrative Agent , each Issuing Lender and Lenders and each of their respective Affiliates and officers, attorneys, agents, employees and advisors of such Persons and Affiliates (the “Released Parties”) from any and all losses, claims, damages, liabilities and related reasonable expenses (including the fees and expenses of counsel for such Released Parties) of any kind nature whatsoever and howsoever arising that each Loan Party ever had or now has against any of them through and including the date hereof arising out of or relating to any acts or omissions with respect to the Credit Agreement or the Loan Documents; provided, however, that no Released Party (as applicable) is released from its obligations under the Loan Documents as amended hereby.

 

13.          Miscellaneous.

 

(a)           Counterparts; Integration. This Amendment may be executed in counterparts (and by different parties hereto in different counterparts), each of which shall constitute an original, but all of which when taken together shall constitute a single contract.  This Amendment, the Credit Agreement and the other Loan Documents, and any separate letter agreements with respect to fees payable to Administrative Agent, constitute the entire contract among the parties relating to the subject matter hereof and supersede any and all previous agreements and understandings, oral or written, relating to the subject matter hereof including any prior confidentiality agreements and commitments. Delivery of an executed counterpart of a signature page of this Amendment by telecopy or e-mail shall be effective as delivery of a manually executed counterpart of this Amendment.

 

(b)           Severability.  The provisions of this Amendment are intended to be severable.  If any provision of this Amendment shall be held invalid or unenforceable in whole or in part in any jurisdiction, such provision shall, as to such jurisdiction, be ineffective to the

 

8

 

extent of such invalidity or unenforceability without in any manner affecting the validity or enforceability thereof in any other jurisdiction or the remaining provisions hereof in any jurisdiction.

 

(c)           Headings.  The headings used herein are included for convenience and shall not affect the interpretation of this Amendment.

 

(d)           Cost and Expenses.  The Borrower shall pay all expenses as provided in Section 10.3 of the Credit Agreement incurred by Administrative Agent and its Affiliates (including the reasonable fees, charges and disbursements of counsel for Administrative Agent) in connection with this Amendment and the Credit Agreement, the syndication of the credit facilities provided for therein, the preparation, negotiation, execution, delivery and administration of this Amendment and the other Loan Documents.

 

(e)           Governing Law.  This Amendment shall be deemed to be governed under the Laws of the State of New York without regard to its conflict of laws principles.

 

(f)            Modifications.  No modification hereof or any agreement referred to herein shall be binding or enforceable unless in writing and signed on behalf of the party against whom enforcement is sought.

 

 [SIGNATURE PAGES TO FOLLOW]

 

9

 

IN WITNESS WHEREOF, the Borrower, the Administrative Agent and Lenders have caused this Lender Joinder and First Amendment to Credit Agreement to be executed by their duly authorized officers as of the date first above written.

 

	
BORROWER:
    	
LANNETT   COMPANY, INC.
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/   Arthur P. Bedrosian
    
	
 
    	
Name:
    	
Arthur   P. Bedrosian
    
	
 
    	
Title:
    	
Chief   Executive Officer
    

 

Acknowledged and Agreed to by:

 

GUARANTORS:

 

	
 
    	
CODY   LABORATORIES, INC.
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/   Michael Landis
    
	
 
    	
Name:
    	
Michael   Landis
    
	
 
    	
Title:
    	
Treasurer
    
	
 
    	
 
    	
 
    
	
 
    	
LANNETT   HOLDINGS, INC.
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/   Arthur P. Bedrosian
    
	
 
    	
Name:   
    	
Arthur   P. Bedrosian
    
	
 
    	
Title:
    	
Vice   President
    

 

SIGNATURE PAGE

LENDER JOINDER AND FIRST AMENDMENT TO

CREDIT AGREEMENT

 

 

	
 
    	
CITIBANK,   N.A., solely in its capacity as Administrative Agent
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/   Luke Hirneisen
    
	
 
    	
Name:
    	
Luke   Hirneisen
    
	
 
    	
Title:   
    	
Vice   President
    

 

SIGNATURE PAGE

LENDER JOINDER AND FIRST AMENDMENT TO

CREDIT AGREEMENT

 

 

	
 
    	
LENDERS:
    
	
 
    	
 
    
	
 
    	
CITIBANK,   N.A., as a Lender, an L/C Issuer and the Swing Line Lender
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/   Luke Hirneisen
    
	
 
    	
Name:
    	
Luke   Hirneisen
    
	
 
    	
Title:
    	
Vice   President
    
	
 
    	
 
    
	
 
    	
PNC   BANK, NATIONAL ASSOCIATION, as a Lender and an L/C   Issuer
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/   John M. DiNapoli
    
	
 
    	
Name:
    	
John   M. DiNapoli
    
	
 
    	
Title:
    	
Senior   Vice President
    
	
 
    	
 
    	
 
    
	
 
    	
CITIZENS   BANK, N.A., as a Lender
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/   Thomas Walsh
    
	
 
    	
Name:
    	
Thomas   Walsh
    
	
 
    	
Title:
    	
Assistant   Vice President
    
	
 
    	
 
    	
 
    
	
 
    	
TRISTATE   CAPITAL BANK, as a Lender
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/   Mark W. Torie
    
	
 
    	
Name:
    	
Mark   W. Torie
    
	
 
    	
Title:
    	
Senior   Vice President
    

 

SIGNATURE PAGE

LENDER JOINDER AND FIRST AMENDMENT TO

CREDIT AGREEMENT

 

 

SCHEDULE I

 

DISCLOSURE SCHEDULES

 

	
ITEM   6.7
    	
 
    	
Litigation.
    
	
ITEM   6.7(b)
    	
 
    	
Labor   Matters.
    
	
ITEM   6.8
    	
 
    	
Initial   Capitalization.
    
	
ITEM   6.10(b)
    	
 
    	
Real   Property Assets.
    
	
ITEM   6.11
    	
 
    	
Tax   Matters.
    
	
ITEM   6.12
    	
 
    	
ERISA   Plans.
    
	
ITEM   6.13
    	
 
    	
Environmental   Matters.
    
	
ITEM   6.14
    	
 
    	
Inventory   Locations.
    
	
ITEM   6.19(a)
    	
 
    	
Material   Agreements.
    
	
ITEM   6.19(c)
    	
 
    	
Material   Governmental Approvals.
    
	
ITEM   6.21
    	
 
    	
Insurance.
    
	
ITEM   6.22
    	
 
    	
Related   Party Transactions.
    
	
ITEM   7.2.2(c)
    	
 
    	
Ongoing   Indebtedness.
    
	
ITEM   7.2.3(c)
    	
 
    	
Existing   Liens.
    
	
ITEM   7.2.5(a)
    	
 
    	
Ongoing   Investments.
    

 

 

SCHEDULE II

 

PERCENTAGES

 

	
Lender
    	
 
    	
Revolving Loan
   Commitment
    	
 
    	
Letter of Credit
   Commitment
    	
 
    	
Percentage
    	
 
    
	
Citibank, N.A.
    	
 
    	
$
    	
45,000,000
    	
 
    	
$
    	
3,000,000
    	
 
    	
37.500000001
    	
%
    
	
PNC Bank, N.A.
    	
 
    	
$
    	
40,000,000
    	
 
    	
$
    	
2,000,000
    	
 
    	
33.333333333
    	
%
    
	
Citizens Bank, N.A.
    	
 
    	
$
    	
25,000,000
    	
 
    	
$
    	
0
    	
 
    	
20.833333333
    	
%
    
	
TriState Capital Bank
    	
 
    	
$
    	
10,000,000
    	
 
    	
$
    	
0
    	
 
    	
8.333333333
    	
%
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
Total
    	
 
    	
$
    	
120,000,000
    	
 
    	
$
    	
5,000,000
    	
 
    	
100.000000000
    	
%
    

 

 

SCHEDULE III

 

ADMINISTRATIVE INFORMATION

 

Borrower:

 

Lannett Company, Inc.

9000 State Road

Philadelphia, PA 19136

Attention: Chief Financial Officer
  Facsimile No.:  215-671-0663

 

Administrative Agent:

 

Citibank, N.A.
  1650 Market Street - Suite 3550

Philadelphia, PA 19103

 

Attention: Luke Hirneisen, Vice President
 Facsimile: 267-443-1177

Email: Luke.Hirneisen@citi.com

 

Lenders:

 

Citibank, N.A.
  1650 Market Street - Suite 3550

Philadelphia, PA 19103

 

Attention: Luke Hirneisen, Vice President
 Facsimile: 267-443-1177

Email: Luke.Hirneisen@citi.com

 

PNC Bank, National Association
 1000 Westlakes Drive

Berwyn, PA 19312

 

Attention: John M. Dinapoli, Relationship Manager
 Email: john.dinapoli@pnc.com

 

Attention: Mary Ann Cruz, Loan Support Analyst

Facsimile: 877-718-7654

Email: Mary.Cruz@pnc.com

 

 

Citizens Bank, N.A.
  600 Washington Blvd. CS117E

Stamford, CT 06901

 

Attention: Thomas Walsh, AVP

Facsimile:

E-Mail Address: thomas.walsh@citizensbank.com

 

TriState Capital Bank

789 E Lancaster Ave, Ste 240
 Villanova, PA 19085

 

Attention:  Mark Torie, SVP

Facsimile: 610-581-7110

E-Mail Address: mtorie@tscbank.comex4_53.htm

Exhibit 4.53

_____________________________________________________________

THE GLOBAL SOURCES

EQUITY COMPENSATION (2007) MASTER PLAN

(AMENDED AND RESTATED EFFECTIVE AS OF JANUARY 1, 2014)

______________________________________________________________

  

  

  

CONTENTS

	
No.

 

	
Section

	
Page

	
1.

 

	
Name of the Plan

	
2

	
2.

 

	
Purpose of the Plan

	
2

	
3.

 

	
Shares Subject to the Plan

	
2

	
4.

 

	
Eligible Persons

	
3

	
5.

 

	
No Payment

	
3

	
6.

 

	
Non-transferability

	
3

	
7.

 

	
Adjustments

	
3

	
8.

 

	
Vesting of Shares and forfeiture of unvested Shares

	
3

	
9.

 

	
Transfer of Shares

	
4

	
10.

 

	
Plan Duration

	
5

	
11.

 

	
Administration

	
5

	
12.

 

	
Government Regulations

	
6

	
13.

 

	
Costs and Expenses

	
6

	
14.

 

	
Amendment or Termination of the Plan

	
6

	
15.

 

	
Limitation of Liability

	
7

	
16.

	
Governing Law and Jurisdiction

	
7

  

  

  

THE GLOBAL SOURCES

EQUITY COMPENSATION (2007) MASTER PLAN

(AMENDED AND RESTATED EFFECTIVE AS OF JANUARY 1, 2014)

	
1.

	
Name of the Plan

	
1.1

	
This equity compensation plan shall be known as “The Global Sources Equity Compensation (2007) Master Plan” (the “Plan”).

	
2.

	
Purpose of the Plan

	
2.1

	
Under this Plan, grants (“Grants”), or individually a grant (“Grant”), of common shares of One United States Cent (US$0.01) par value each (the “Shares”) of Global Sources Ltd. (the “Company”), may be awarded from time to time to Global Sources Team Members (as defined in Section 4.1 below), by the Plan Committee (as defined in Section 3.3 below); provided however that the total number of all Shares awarded pursuant to such Grants shall not exceed six million (6,000,000) in the aggregate.

	
3.

	
Shares Subject to the Plan

3.1           All Shares under a Grant, which have been awarded in accordance with the provisions of this Plan:-

	
  

	
(a)

	
shall be issued and allotted by the Company to Appleby Trust (Bermuda) Ltd. (now known as “Appleby Services (Bermuda) Ltd.”) (“Trustee”) to be held by it as trustee of a trust to be known as “The Global Sources Equity Compensation Trust 2007” (the “Trust”), at any time following the award thereof, and shall be eligible for transfer (and shall be subsequently transferred) by the Trustee to the respective Global Sources Team Members who have received Grants pursuant to this Plan (each a “Grantee”, and collectively the “Grantees”), subject to and in accordance with the applicable vesting rules and other applicable provisions of this Plan (including but not limited to the provisions of  Section 7 below with regard to any adjustments (if applicable)); or

	
  

	
(b)

	
shall be issued and allotted by the Company directly to the Grantee, subject to and in accordance with the vesting rules and other applicable provisions of this Plan (including but not limited to the provisions of  Section 7 below with regard to any adjustments (if applicable)).

	
3.2

	
Shares which are not awarded under this Plan shall be available for the award of any future Grant or Grants under this Plan or any subsequent equity compensation plans.

	
3.3

	
The document for the establishment of the Trust (“Trust Document”) shall provide for a plan committee (“Plan Committee”) to determine the award and allocation of Grants, Shares and other related benefits to the Grantees. The Plan Committee shall be constituted by the Company pursuant to the Trust Document, and shall consist of not less than three (3) and not more than five (5) individuals to be appointed by the Company’s board of directors. The details of the Plan Committee’s powers, functions and terms of reference shall be set out in the Trust Document.

  

2

  

	
4.

	
Eligible Persons

	
4.1

	
In this Plan, a “Global Sources Team Member” shall mean any person who is at the time of a Grant (made pursuant to this Plan) employed or engaged (“eligibly employed”) as an employee, director or consultant of:-

	
  

	
(a)

	
the Company or any of its subsidiaries (the Company and its subsidiaries being hereinafter collectively referred to as the “Global Sources Group”); or

	
  

	
(b)

	
any independent contractor of any Global Sources Group entity, as determined by the Plan Committee from time to time (“Other Relevant Entity”).

	
4.2

	
Global Sources Team Members are eligible to be Grantees.

	
4.3

	
The award of Grants shall be determined by resolution of the Plan Committee.  The Plan Committee shall also be entitled to determine who amongst the various potentially eligible Grantees shall actually be awarded Shares under a Grant; the number of Shares which may be awarded to a Grantee under a Grant; the applicable periods, schedules, instalments, rules, regulations, terms and conditions for the vesting of Shares awarded to Grantees under a Grant (“Vesting Rules”); and such other related benefits and matters, and such other rules and regulations for the carrying out of the Plan, as may be deemed fit or appropriate by the Plan Committee (to the extent not inconsistent with the provisions of this Plan) (“Other Rules/Matters”).

	
5.

	
No Payment

5.1           There shall be no payment by a Grantee for Shares awarded under a Grant.

	
6.

	
Non-transferability

	
6.1

	
Any Grant and any Shares awarded thereunder (whether unvested or vested) shall be non-transferable by the Grantee, except in accordance with the provisions of Section 9 below.

	
7.

	
Adjustments

	
7.1

	
If the outstanding Shares then subject to this Plan are changed into or exchanged for a different number or kind of shares or securities, as a result of one (1) or more reorganisations, recapitalisations, stock splits, reverse stock splits, stock dividends or the like, appropriate adjustments shall be made in the number and/or type of shares or securities for which Shares pursuant to Grants then outstanding under this Plan may thereafter be vested.

	
8.

	
Vesting of Shares and forfeiture of unvested Shares

	
8.1

	
Shares under a Grant awarded pursuant to this Plan shall vest in the Grantee in accordance with the applicable Vesting Rules, subject however to the provisions of Section 8.2 below.

  

3

  

	
8.2

	
In the case of any Grant awarded hereunder:

	
  

	
(a)

	
if a Grantee ceases to be eligibly employed by any Global Sources Group entity or any Other Relevant Entity, for any reason whatsoever, other than because of “normal retirement” (as defined in Section 8.3 below) (in which case the provisions of this Section 8.2(a) shall apply), or death or disability (in which case, the provisions of Section 8.2(b) below shall apply), all rights and entitlement of the Grantee to the vesting of Shares which have been awarded pursuant to the Grant, but which have not yet vested at the date of the Grantee ceasing to be eligibly employed, shall automatically terminate and be forfeited, concurrently with such cessation of eligible employment; or

	
  

	
(b)

	
if the Grantee shall die, become disabled, or take normal retirement while eligibly employed by a Global Sources Group entity or Other Relevant Entity, or, in the case of death, the person or persons to whom the Grantee’s rights under the Grant shall have lawfully passed (whether by will, or by the applicable laws of succession or otherwise), shall retain the same rights of vesting, with respect to Shares already awarded pursuant to the Grant but not yet vested at the time of death, disablement or normal retirement (as the case may be), as would have been available if the Grantee had continued to be eligibly employed.

	
8.3

	
For the purposes hereof, “normal retirement” shall mean retirement (from active employment or engagement) by the person eligibly employed:-

	
  

	
(a)

	
on or after the normal retirement date specified in the applicable pension plan or other applicable retirement policy; or

	
  

	
(b)

	
if there is no such applicable pension plan or other applicable retirement policy, on or after such normal retirement age as may be prescribed by the Plan Committee (if and to the extent not in contravention of any minimum retirement age prescribed by the applicable law, if any, otherwise the minimum retirement age for the purposes of this subsection (b) shall be that prescribed by the applicable law instead); or

	
  

	
(c)

	
where, notwithstanding that such retirement occurred before the relevant date referred to in subsection (a) or (b) above, the Plan Committee considers (in its sole and absolute discretion) that such retirement shall be treated as a “normal retirement” for the purposes of this Section 8.

	
9.

	
Transfer of Shares

	
9.1

	
Upon award of a Grant, the Shares awarded to each Grantee under such Grant shall not vest in the Grantee, but:-

	
  

	
(a)

	
shall be issued and allotted by the Company to the Trustee and held by the Trustee (as trustee of the Trust) and shall only be transferred by the Trustee to the Grantee in accordance with the Vesting Rules prescribed by the Plan Committee; or

	
  

	
(b)

	
shall only be issued and allotted by the Company directly to the Grantee in accordance with the Vesting Rules prescribed by the Plan Committee, subject however to the provisions of this Section 9 and any other applicable provisions of this Plan.

  

4

  

	
9.2

	
At the time when Shares (awarded pursuant to a Grant) are to vest in a Grantee pursuant to the Vesting Rules, the Grantee may direct the Trustee to transfer or the Company to issue and allot (as the case may be) such Shares to such person as the Grantee directs; provided that, in the event of the Grantee directing the Trustee to transfer or the Company to issue and allot (as the case may be) the Shares to someone other than the Grantee, the Grantee shall be responsible for (i) any and all compliance with applicable laws and regulations pertaining to such transfer or such issue and allotment (as the case may be) and the eligibility of such other person to accept such transfer or such issue and allotment (as the case may be) and to receive and hold the Shares; and (ii) any and all obligations, liabilities or taxes incurred as a consequence of, or arising from or in connection with, such direction and transfer or issue and allotment (as the case may be).

	
9.3

	
If a Grantee ceases to be eligibly employed by reason of death, disability or normal retirement, before Shares (awarded pursuant to a Grant) have vested in the Grantee pursuant to the Vesting Rules, then the Grantee (or the personal representative of the Grantee as the case may be) may direct the Trustee to transfer or the Company to issue and allot (as the case may be) to the Grantee (or the personal representative, as the case may be), or to such person as the Grantee (or the personal representative of the Grantee, as the case may be) directs, such Shares, at the time when such Shares are to vest pursuant to the Vesting Rules; provided that, in the event of the Grantee (or the personal representative of the Grantee, as the case may be) directing the Trustee to transfer or the Company to issue and allot (as the case may be) the Shares to someone other than the Grantee, the Grantee (or the personal representative of the Grantee, as the case may be) shall be responsible for (i) any and all compliance with applicable laws and regulations pertaining to such transfer or such issue and allotment (as the case may be) and the eligibility of such other person to accept such transfer or such issue and allotment (as the case may be) and to receive and hold the Shares; and (ii) any and all obligations, liabilities or taxes incurred as a consequence of, or arising from or in connection with, such direction and transfer or issue and allotment (as the case may be).

	
10.

	
Plan Duration

	
10.1

	
This Plan shall commence on 1 January 2007 (“Commencement Date”) and shall expire on 31 December 2017 (“Expiration Date”), unless terminated earlier in accordance with the provisions of this Plan.

	
10.2

	
No Grants may be awarded after the expiration or termination of this Plan.

	
11.

	
Administration

	
11.1

	
This Plan shall be managed and administered by the Trustee, subject always to the directions of the Plan Committee as provided under the Trust Document.

	
11.2

	
The interpretation and construction by the Plan Committee of any of the provisions of this Plan or of any Grants awarded hereunder shall be final and binding upon Grantees and their respective successors, unless otherwise determined by the Company’s board of directors, in which case such determination of the Company’s board of directors shall be final and binding.

  

5

  

	
11.3

	
The Trustee, the Plan Committee, the Company’s board of directors and the Company shall not be liable for any action taken, or determination made, in good faith, in connection with this Plan.

	
11.4

	
The Plan Committee may, subject to the provisions of this Plan, issue a certificate or other form or forms of instruments (including but not limited to any addendum, supplementary, ancillary, secondary or subsidiary document(s) to this Plan) as the Plan Committee may (in its sole and absolute discretion) determine, for the purposes of documenting and/or evidencing Grants awarded under this Plan, and the Vesting Rules and any Other Rules/Matters pertaining thereto.

	
11.5

	
The Company or its board of directors may delegate any of its powers, rights, duties and/or responsibilities under this Plan to the Plan Committee, who may discharge the same with the authority and in the place and stead of the Company or its board of directors (as the case may be).

	
12.

	
Government Regulations

	
12.1

	
The Trustee shall not transfer or the Company shall not issue and allot (as the case may be) any Shares under any Grant upon the vesting thereof, unless and until all applicable licences, permissions and authorisations required to be granted by the Government of Bermuda, or by any authority or agency thereof, if any, shall have been duly received.

13.           Costs and Expenses

	
13.1

	
All costs and expenses with respect to the adoption of this Plan and in connection with the registration of Shares shall be borne by the Company; provided, however, that (except as otherwise specifically provided in this Plan or in any agreement between the Company and a Grantee), the Company shall not be obliged to pay any costs or expenses (including but not limited to any legal fees) incurred by any Grantee in connection with any Grant or Shares held or transferred by any Grantee.

	
14.

	
Amendment or Termination of the Plan

	
14.1

	
Subject to the provisions of Section 14.2 below, this Plan may be altered, amended, suspended or terminated by resolution of the Company’s board of directors (acting in their sole and absolute discretion); provided however that, except as otherwise provided in this Plan, no such action shall deprive any Grantee, without his or her consent, of any of his/her rights under a Grant already awarded pursuant to this Plan.

	
14.2

	
Save as herein provided, the Company’s board of directors shall not be entitled to take any action with respect to any of the following matters, except with the approval of a resolution of a majority of the shareholders of the Company in general meeting:

	
  

	
(a)

	
any extension of the Expiration Date of this Plan; or

	
  

	
(b)

	
any alteration of the class of persons eligible to be Grantees under this Plan.

	
14.3

	
For the avoidance of doubt, no amendment of this Plan shall increase the duties and/or responsibilities of the Trustee without its consent.

  

6

  

	
15.

	
Limitation of Liability

	
15.1

	
No member of the Company’s board of directors or the Plan Committee, or any person authorised to act on their behalf, shall be personally liable for any action, determination or interpretation taken or made in good faith with respect to this Plan, and all members of the Company’s board of directors or the Plan Committee, and each and any person authorised to act on their behalf, shall, to the extent permitted by law, be fully indemnified and protected by the Company in respect of any such action, determination or interpretation.

	
16.

	
Governing Law and Jurisdiction

	
16.1

	
This Plan shall be governed by and interpreted and construed in accordance with the laws of Bermuda; and the Company, the Trustee, the Plan Committee (and its members), and each Grantee, hereby irrevocably submits to the jurisdiction of the courts of Bermuda.

 

 

 

7

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