EX-10.39 5 y47386a1ex10-39.txt 6TH AMENDMENT & WAIVER 1 SIXTH AMENDMENT AND WAIVER SIXTH AMENDMENT AND WAIVER, dated as of March 30, 2001 (this "Amendment"), to the Amended and Restated Credit and Guarantee Agreement, dated as of November 15, 1996 (as amended, supplemented or otherwise modified from time to time, the "Credit Agreement"), among Twinlab Corporation, a Delaware corporation ("Holdings"), Twin Laboratories Inc., a Utah corporation (the "Borrower"), the several banks and other financial institutions parties to the Credit Agreement (the "Lenders"), The Bank of New York, as co-agent for the Lenders thereunder (in such capacity, the "Co-Agent"), and The Chase Manhattan Bank, as administrative agent for the Lenders thereunder (in such capacity, the "Administrative Agent"). W I T N E S S E T H: WHEREAS, the Borrower has requested that the Administrative Agent and the Lenders amend the Credit Agreement and waive certain defaults arising from the Borrower's failure to comply with certain covenants; WHEREAS, the Administrative Agent and the Lenders are willing to agree to the requested amendments and waivers on the terms and conditions contained herein; NOW, THEREFORE, in consideration of the premises and the mutual covenants contained herein, the parties agree as follows: 1. Definitions. Unless otherwise defined herein, terms defined in the Credit Agreement shall have their defined meanings when used herein. 2. Amendments to Subsection 1.1 (Definitions). Subsection 1.1 of the Credit Agreement is hereby amended by (i) deleting "March 30, 2001" where it appears in the definition of "Amendment Period" in such subsection and (ii) inserting, in lieu thereof, "April 3, 2001". 3. Certain Agreements. (a) The Borrower, the Administrative Agent and the Lenders acknowledge and agree that, during the Amendment Period, the Lenders shall make Extensions of Credit only to the extent that such Extensions of Credit do not exceed the lesser of (i) the Borrowing Base or (ii) $45,000,000. (1) The Borrower hereby acknowledges and agrees that, during the Amendment Period, the Borrower shall not, and shall not permit any of its Subsidiaries to, make any Restricted Payments on any class of the Capital Stock of the Borrower (other than as permitted under subsections 7.7(a), (b) and (c) of the Credit Agreement) or make any optional payment or prepayment or redemption, defeasance or purchase of any Senior Subordinated Notes or any other Subordinated Indebtedness (if any) of the Borrower. 2 (2) The Borrower hereby acknowledges and agrees that, during the Amendment Period, the Borrower shall not, and shall not permit any of its Subsidiaries to, make any Permitted Acquisitions. (3) The Borrower hereby agrees to keep the Administrative Agent and the Lenders informed of the progress of the status of the Borrower's discussions concerning entering into an alternative credit facility that will replace the Credit Agreement, including, without limitation, prompt notice of the receipt and execution of any commitment letter, the completion by the relevant lender of its due diligence and collateral audit review, and the setting of any closing date, or, as the case may be, the decision by the Borrower or any new lender not to pursue such alternative credit facility. (4) Failure to comply with the agreement contained in paragraph (a) of this Section 3 shall constitute an Event of Default under Section 10(a) of the Credit Agreement and failure to comply with the agreements contained in paragraphs (b) and/or (c) of this Section 3 shall constitute an Event of Default under Section 10(c) of the Credit Agreement. 4. Waivers. (a) For the Amendment Period, the Administrative Agent and the Lenders hereby waive (i) the Borrower's non-compliance with the provisions of subsections 6.1, 6.2, 6.6 and 6.7 of the Credit Agreement, solely insofar as such non-compliance relates to the Borrower's failure to deliver financial statements in accordance with GAAP in respect of its 1998, 1999 and 2000 fiscal years and of periods included in its 1998, 1999 and 2000 fiscal years through and including September 30, 2000 and to the Borrower's failure to deliver a Borrowing Base Certificate with respect to the month of February 2001, and (ii) the Borrower's non-compliance with the financial covenants contained in subsection 7.1(a) and 7.1(b) of the Credit Agreement, solely insofar as such non-compliance relates to its 1998, 1999 and 2000 fiscal years and to fiscal quarters in its 1998, 1999 and 2000 fiscal years. (1) For the Amendment Period, the Administrative Agent and the Lenders hereby waive any breach by the Borrower of any representation or warranty made or deemed to be made by it pursuant to subsection 5.2 of the Credit Agreement, solely insofar as such breach arises out of the matters described in clauses (i) and (ii) of Section 4(a) of this Amendment. (2) The Administrative Agent and the Lenders hereby agree that the waivers contained in this Section 4 shall have effect for the Amendment Period for purposes of Sections 10(b), (c) and (d) of the Credit Agreement. 5. Conditions to Effectiveness. This Amendment shall be effective on the date (the "Amendment Effective Date") that (a) the Administrative Agent shall have received counterparts hereof, duly executed and delivered by the Borrower, Holdings, the Administrative Agent, the Required Lenders and the Grantors under the Guarantee and Collateral Agreement, and (b) no Default or Event of Default shall have occurred and be continuing on the date hereof after giving effect to this Amendment. 2 3 6. Representations and Warranties. In order to induce the Administrative Agent and the Lenders to enter into this Amendment, the Borrower and Holdings hereby represent and warrant to the Administrative Agent and the Lenders that the representations and warranties of the Borrower and Holdings contained in the Loan Documents are true and correct in all material respects on and as of the Amendment Effective Date (after giving effect hereto) as if made on and as of the Amendment Effective Date (except where such representations and warranties were true and correct in all material respects as of such earlier date); provided that all references to the "Credit Agreement" in any Loan Document shall be and are deemed to mean the Credit Agreement as amended hereby. 7. Payment of Expenses. The Borrower agrees to pay or reimburse the Administrative Agent for all of its out-of-pocket costs and expenses incurred in connection with the development, preparation, execution, delivery and administration of this Amendment and any other documents prepared in connection herewith, and the consummation and administration of the transactions contemplated hereby, including, without limitation, the reasonable fees and disbursements of counsel to the Administrative Agent (including, without limitation, Morgan Lewis & Bockius LLP and Simpson Thatcher & Bartlett) and financial advisors to the Administrative Agent (including, without limitation, FTI Consulting Inc.). 8. Counterparts. This Amendment may be executed by the parties to this Amendment on any number of separate counterparts (which may include counterparts delivered by facsimile transmission), and all of said counterparts taken together shall be deemed to be one and the same instrument. 9. Successors and Assigns. This Amendment shall be binding upon and inure to the benefit of the Borrower and Holdings and their respective successors and assigns, and upon the Administrative Agent and the Lenders and their successors and assigns. 10. Continuing Effect. Except as expressly amended hereby, the Credit Agreement as amended by this Amendment shall continue to be and shall remain in full force and effect in accordance with its terms. This Amendment shall not constitute an amendment or waiver of any provision of the Credit Agreement not expressly referred to herein and shall not be construed as an amendment, waiver or consent to any action on the part of the Borrower and Holdings that would require an amendment, waiver or consent of the Administrative Agent or the Lenders except as expressly stated herein. Any reference to the "Credit Agreement" in the Loan Documents or any related documents shall be deemed to be a reference to the Credit Agreement as amended by this Amendment. 11. GOVERNING LAW. THIS AMENDMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES UNDER THIS AMENDMENT SHALL BE GOVERNED BY, AND CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK. IN WITNESS WHEREOF, the parties have caused this Amendment to be executed and delivered by their respective duly authorized officers as of the day and year first above written. 3 4 TWINLAB CORPORATION By:_________________________________ Name: Title: TWIN LABORATORIES INC. By:_________________________________ Name: Title: THE CHASE MANHATTAN BANK as Administrative Agent, Issuing Bank, Swing Line Lender and as a Lender By:_________________________________ Name: Title: THE BANK OF NEW YORK, as Co-Agent and as a Lender By:_________________________________ Name: Title: FLEETBOSTON, as a Lender By:_________________________________ Name: Title: 5 DRESDNER BANK AG, NEW YORK BRANCH AND GRAND CAYMAN BRANCH, as a Lender By:_________________________________ Name: Title: By:_________________________________ Name: Title: U.S. BANK NATIONAL ASSOCIATION, as a Lender By:_________________________________ Name: Title: EUROPEAN AMERICAN BANK, as a Lender By:_________________________________ Name: Title: ERSTE BANK DER OESTERREICHISCHEN SPARKASSEN AG, GRAND CAYMAN ISLAND BRANCH, as a Lender By:_________________________________ Name: Title: 6 ZIONS FIRST NATIONAL BANK, as a Lender By:_________________________________ Name: Title: ADVANCED RESEARCH PRESS, INC., as a Grantor By:_________________________________ Name: Title: BRONSON LABORATORIES, INC., as a Grantor By:_________________________________ Name: Title: CHANGES INTERNATIONAL, INC., as a Grantor By:_________________________________ Name: Title: HEALTH FACTORS INTERNATIONAL, INC. as a Grantor By:_________________________________ Name: Title: 7 PR NUTRITION, INC., as a Grantor By:_________________________________ Name: Title: