Alpharma
Inc.
Alpharma Operating Corporation
Alpharma U.S. Inc.
Barre Parent Corporation
Alpharma Euro Holdings Inc.
Alpharma (Bermuda) Inc.
Alpharma USHP Inc.
Alpharma Animal Health Company
Mikjan Corporation
Alpharma Holdings Inc.
Alpharma Specialty Pharma Inc.
Purepac Pharmaceutical Holdings, Inc.
Alpharma Pharmaceuticals LLC
440 Route 22 East
Bridgewater, New Jersey 08807
Re: Letter
Agreement Regarding Durect Development and License
Agreement
Reference is made
to that certain Amended and Restated Loan and Security Agreement
dated March 10, 2006 (as at any time amended, restated,
supplemented or otherwise modified, the “Loan
Agreement”), among Alpharma Inc., a Delaware corporation
(“Parent”); Alpharma Operating Corporation, a Delaware
corporation; Alpharma U.S. Inc., a Delaware corporation; Barre
Parent Corporation, a Delaware corporation; Alpharma Euro Holdings
Inc., a Delaware corporation; Alpharma (Bermuda) Inc., a Delaware
corporation; Alpharma USHP Inc., a Delaware corporation; Alpharma
Animal Health Company, a Texas corporation; Mikjan Corporation, an
Arkansas corporation; Alpharma Holdings Inc., a Delaware
corporation; Alpharma Specialty Pharma Inc., a Delaware corporation
f/k/a Alpharma Pharmaceuticals Inc.; Purepac Pharmaceutical
Holdings, Inc., a Delaware corporation; and Alpharma
Pharmaceuticals LLC, a Delaware limited liability company f/k/a
Alpharma Branded Products Division Inc. (collectively,
“Borrowers” and each individually, a
“Borrower”); the various financial institutions party
thereto from time to time (collectively, “Lenders”);
and Bank of America, N.A., a national banking association, in its
capacity as collateral and administrative agent for Lenders
(together with its successors in such capacity,
“Agent”). Capitalized terms used herein and not
otherwise defined herein shall have the meaning ascribed to such
terms in the Loan Agreement.
Borrowers have
informed Agent and Lenders that Alpharma Ireland Limited, a
corporation organized under the laws of Ireland (“Alpharma
Ireland”), desires to effect a certain Development and
License Agreement (the “License Agreement”) with Durect
Corporation, a Delaware corporation (“Licensor”),
pursuant to which Alpharma Ireland will license from Licensor
certain proprietary products for pain treatment and certain patents
and know-how relating thereto. In connection with the License
Agreement, Licensor is requiring an unsecured guaranty from Parent
with respect to all milestone payments of up to $263,000,000 in the
aggregate and all royalty and other payments owing by Alpharma
Ireland under the License Agreement (the “Parent
Guaranty”). Borrowers have requested that Agent
and
Lenders consent
to the Parent Guaranty, and Agent and Lenders are willing to do so,
on the terms and subject to the conditions contained
herein.
NOW THEREFORE, for
Ten Dollars ($10.00) in hand paid, and other good and valuable
consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto hereby agree as
follows:
1.
Consent . Subject to the satisfaction of the conditions
precedent set forth below, Agent and Lenders hereby consent to the
Parent Guaranty. Such consent is subject to the satisfaction of the
following conditions precedent in form and substance satisfactory
to Agent and Lenders in their sole and absolute discretion:
(a) the Parent Guaranty and the License Agreement are executed
and all conditions precedent to the effectiveness thereto are
satisfied on or before December 31, 2008; (b) at the time
of the execution of the Parent Guaranty and the License Agreement,
and after giving effect thereto and hereto, no Default or Event of
Default exists or would result therefrom; and (c) in
connection with the execution of the License Agreement, Licensor
and Alpharma Ireland have filed all documents that are required or
permitted to be filed pursuant to the Hart-Scott-Rodino Antitrust
Improvements Act of 1976 (as at any time amended, the
“HSR”) and have received all necessary approval under
the HSR in connection therewith.
2.
Amendment to Loan Agreement . Upon satisfaction of the
conditions precedent set forth above, the Loan Agreement shall be
deemed amended as follows:
(a) By
deleting the definition of “Permitted Contingent
Obligations” in Section 1.1 of the Loan Agreement and by
substituting in lieu thereof the following:
Permitted
Contingent Obligations — each of the
following:
(i) Contingent Obligations arising from
endorsements of items of payment for collection or deposit in the
Ordinary Course of Business;
(ii) Contingent Obligations of any
Consolidated Group Member existing as of the Closing Date,
including extensions and renewals thereof that do not increase
the amount of such Contingent Obligations as of the date of
such extension or renewal;
(iii) Contingent Obligations arising under
indemnity agreements to title insurers to cause such title insurers
to issue to Agent title insurance policies;
(iv) Contingent Obligations with respect to
customary indemnification obligations in favor of purchasers
in connection with dispositions of Equipment permitted under
Section 8.4.2;
(v) Contingent Obligations consisting of
reimbursement obligations from time to time owing by any Borrower
to Issuing Bank with respect to Letters of Credit (but in no event
to include reimbursement obligations at any time owing by a
Borrower to any other Person that may issue letters of credit for
the account of Borrowers);
(vi) unsecured guaranties made by a
Consolidated Group Member for Debt or other obligations of another
Consolidated Group Member that is expressly permitted to be
incurred hereunder or not prohibited;
2
(vii) Contingent Obligations of Parent
arising under that certain unsecured guaranty dated
September 4, 2007 (the “IDEA Guaranty”), from
Parent to IDEA AG, a German corporation (“IDEA”), with
respect to mi
|
