February
6, 2008
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
Barre
Parent Corporation
440
Route 22 East
Bridgewater,
New Jersey 08807
Re: Consent
to Disposition of API Division
Ladies
and Gentlemen:
Reference is made to that certain Amended and Restated Loan
and Security Agreement dated March 10, 2006 (as at any time
amended, the " Loan
Agreement "), among Alpharma Inc., a Delaware
corporation (" Alpharma
"), 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 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
the 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 certain
Subsidiaries that are not Borrowers intend to dispose of all
of the capital stock and other Equity Interests they own in
certain entities, which are not Borrowers, associated with
Alpharma's active pharmaceuticals business (the " API Stock
Disposition ") and, in connection therewith, Alpharma
intends to dispose of certain assets relating to its active
pharmaceutical ingredients business located in the United
States (the " API
Asset
Alpharma
Inc.,
et al.
February
6, 2008
Page
2
__________________
Disposition
" and, collectively with the API Stock Disposition, the "
API
Disposition "), which assets are more particularly
described on Exhibit A
attached hereto (the " API
Assets "). For illustrative purposes, a list
of the Accounts and Inventory of Alpharma, which would
constitute "API Assets" as of December 31, 2007, is attached
hereto and incorporated herein as Exhibit B
.
The
API Asset Disposition does not constitute a Permitted Asset
Disposition under the Loan Agreement. Borrowers
have requested that Agent and Lenders consent to the API
Asset Disposition and agree to release their Liens on the API
Assets in connection therewith. Agent and Lenders
are willing to do so, on the terms and subject to the
conditions set forth 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
to API Disposition .
Notwithstanding the provisions of
Section
10.2.10 of the Loan Agreement and the definition of
Permitted Asset Disposition set forth in the Loan Agreement, Agent
and Lenders hereby consent to the API Asset Disposition and agree
to execute a release of Agent's security interest in and Liens upon
the API Assets, subject to Borrowers' satisfaction of the
conditions precedent set forth in Section 2 of
this letter agreement.
2.
Conditions
Precedent . Agent's
and Lenders' consent to the API Asset Disposition and agreement to
release their Liens upon the API Assets shall be subject to
satisfaction of the following conditions precedent: (a) both before
and after giving effect to the consummation of the API Disposition,
no Default or Event of Default exists, and Availability is not less
than $25,000,000; (b) not less than 10 days prior to the
consummation of the API Disposition (or such lesser period of time
to which Agent, in its discretion, may agree in writing), Borrowers
deliver to Agent draft copies of the purchase agreement and other
material agreements anticipated to be executed or delivered in
connection with the API Disposition (the " Transaction
Documents "); (c) the API Disposition is consummated and the
API Assets are transferred to the purchaser thereof on or before
August 15, 2008; and (d) concurrently with the consummation of the
API Disposition, Alpharma, in its capacity as Borrower
Representative, delivers to Agent a release letter confirming the
consummation of the API Disposition in accordance with the
conditions contained in this Section 2
.
3.
Additional
Covenants . As
additional consideration for Agent's and Lenders' execution and
performance of this letter agreement, Borrowers hereby agree with
Agent and Lenders that: (a) not less
than 30 days after the consummation of the API Disposition,
Borrowers shall deliver to Agent executed copies of the Transaction
Documents; (b) within 60 days after the date of the consummation of
the API Disposition (or such longer period to which Agent may
consent in writing in its reasonable discretion), Borrowers shall
repay, or cause to be repaid, all amounts owed by Alpharma
(Taizhou) Pharmaceuticals Co., Ltd. in respect of the Chinese
Credit Facility; and (c) the Loan Agreement shall be amended in
accordance with Section 5 of
this letter agreement, and Borrowers shall cause Alpharma Animal
Health (Shenzhou) Co., Ltd., Alpharma Animal Health (Yantai) Co.,
Ltd., and Alpharma Animal Health (Beijing) Trading Co., Ltd. to
execute and deliver
Alpharma
Inc.,
et al.
Febr
