EXHIBIT 10.49
[THE ROYAL BANK OF SCOTLAND LETTERHEAD]
To: Inverness Medical Innovations, Inc. (the "PARENT GUARANTOR")
as agent of each Borrower (as defined in the Mezzanine Loan
Agreement as defined below)
20th September 2002
Dear Sirs
MEZZANINE LOAN AGREEMENT DATED 20 DECEMBER 2001 MADE BETWEEN THE PARENT
GUARANTOR, INVERNESS MEDICAL SWITZERLAND GMBH, CERTAIN BANKS AND RBS MEZZANINE
LIMITED AS LEAD ARRANGER AND FACILITY AGENT (AS AMENDED FROM TIME TO TIME, THE
"MEZZANINE LOAN AGREEMENT")
Unless otherwise defined herein capitalised terms used in this letter shall have
the meaning specified in the Mezzanine Loan Agreement.
We, RBS Mezzanine Limited, write to you in our capacity as Facility Agent for
and on behalf of the Finance Parties.
The Parent Guarantor has requested pursuant to a letter dated 18 September 2002
that the Facility Agent consent to WL Acquisition Corp, a wholly owned
subsidiary of the Parent Guarantor acquiring the ▇▇▇▇▇▇▇ Laboratories division
of Medpointe, Inc. (the "ACQUISTION") and we are writing to confirm the terms
upon which the Facility Agent, on behalf of the Finance Parties, has consented
to the Acquisition.
1. CONSENTS AND CONDITIONS
1.1 Notwithstanding Clause 12.3.8 (ACQUISITIONS) and Clause 12.3.5 (FEES)
of the Mezzanine Loan Agreement and subject to Clause 1.2 below, upon
your countersignature of this letter the Facility Agent consents to the
Acquisition and the payment of a maximum of US$1,000,000 on fees
relating to the Acquisition.
1.2 The consents referred to in Clause 1.1 is subject to the following:
1.2.1 Clause 1.1 (DEFINITIONS) of the Mezzanine Loan Agreement shall
be amended as follows:
(a) in the second line of the definition of "GROUP" after
the words "IVC Group Company" inserting the words
"and, until the ▇▇▇▇▇▇▇ Security Date, each ▇▇▇▇▇▇▇
Group Company";
(b) after the definition "NEW EQUITY" inserting the
following:
"NOTES" means the subordinated promissory
notes issued by the Parent Guarantor
pursuant to the Note Agreements.
"NOTE AGREEMENTS" means the Subordinated
Note and Warrant Purchase Agreement and the
Subordinated Note Purchase Agreement each
dated on or about 20 September 2002 between
the Parent and Note Holders.
"NOTE HOLDERS" means the persons whose names
are set out in Schedule 2 (NOTE HOLDERS) of
the subordination agreement dated on or
about 20 September 2002 made between, among
others, the Parent Guarantor, the Note
Holders and the Security Trustee and shall
include their respective assigns,
transferees and successors whether immediate
or derivative.
(c) after the definition of "VENDOR" inserting the
following:
""▇▇▇▇▇▇▇" means WL Acquisition Corp;
"▇▇▇▇▇▇▇ GROUP" means ▇▇▇▇▇▇▇ and each of
its Subsidiaries; and "▇▇▇▇▇▇▇ GROUP
COMPANY" means any one of them;
"▇▇▇▇▇▇▇ SECURITY" means a Group Guarantee
and an Asset Security Document duly executed
by each ▇▇▇▇▇▇▇ Group Company which is a
Material Company and a Share Charge in
respect of the entire issued share capital
of each such company duly executed by any
relevant Group Company together with such
documentation in support thereof as the
Security Trustee may reasonably require,
including legal opinions (in form and
substance satisfactory to the Security
Trustee) from lawyers reasonably acceptable
to the Security Trustee; and
"▇▇▇▇▇▇▇ SECURITY DATE" means the date on
which each ▇▇▇▇▇▇▇ Group Company delivers
the ▇▇▇▇▇▇▇ Security to the Security
Trustee."
1.2.2 Clause 14.3 (NEGATIVE UNDERTAKINGS) shall be amended by
inserting after Clause 14.3.12 (ERISA) the following:
"14.3.13 PAYMENTS ON THE NOTES: in respect of the Parent
Guarantor only, repay or prepay, redeem or purchase
the Notes or pay any interest in respect of the Notes
provided that the Parent Guarantor may (i) pay in
common stock any amounts which are permitted to be
paid under the Notes in shares of Parent Guarantor
Common Stock (as such term is defined in the Notes),
US$0.001 par value per share; and (ii) pay in cash
(A) an aggregate amount of US$60,000 in respect of
interest accrued on the Notes up to and including 30
September 2002 and (B) interest on the Notes in
accordance with the terms of the Notes, so long as
(1) no Default has occurred and is continuing and (2)
the Parent Guarantor has not notified the Facility
Agent of any Potential Default pursuant to Clause
12.1.7."
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1.2.3 the execution by all the parties thereto of a subordination
agreement, in a form approved by us, subordinating the
subordinated notes and warrants and convertible notes used to
fund part of the purchase price of the Acquisition;
1.2.4 no more than US$35,000,000 of cash from the Parent Guarantor's
consolidated balance sheet being used to pay the remaining
purchase price of the Acquisition. It is acknowledged by the
parties hereto that US$1,000,000 of the purchase price of the
Acquisition has been paid prior to the date of this letter;
and
1.2.5 the Parent Guarantor prepaying an amount of at least
US$10,000,000 in prepayment of the Senior Term Loans in
accordance with Clause 9.9.1 of the Senior Credit Agreement.
2. UNDERTAKINGS
2.1 The Parent Guarantor undertakes to procure that, subject to any legal
prohibitions or limitation on the giving of any of the ▇▇▇▇▇▇▇ Security
(as defined above) either at all or within any time frame specified by
the Facility Agent, on or prior to 31 October 2002 the ▇▇▇▇▇▇▇ Security
will have been delivered to the Security Trustee.
2.2 Any breach of the undertaking set out in sub-clause 2.1 above shall be
deemed to be a Default.
3. EFFECTIVENESS OF THE MEZZANINE LOAN AGREEMENT
Subject to the consents set out in Clause 1.1 and save as expressly
amended hereby, the Mezzanine Loan Agreement shall remain in full force
and effect in accordance with its terms and nothing contained herein
shall prejudice any of the rights of the Finance Parties under the
Financing Documents.
4. COSTS AND EXPENSES
The Parent Guarantor shall reimburse the Facility Agent from time to
time for all costs and expenses (including reasonable legal fees and
value added tax thereon) incurred by it in the preparation,
negotiation, execution and enforcement of this letter and in connection
with the preservation of its rights hereunder.
5. SECURITY DOCUMENT
The subordination agreement referred to in sub-paragraph 1.2.3 above
shall be a Security Document.
6. INCORPORATION OF TERMS
The provisions of sub-clause 23.2 of Clause 23 (LAW AND JURISDICTION)
of the Mezzanine Loan Agreement shall be incorporated into this letter
as if set out in full in this letter and as if references in such
sub-clause to "this Agreement" or "the Financing Documents" are
references to this letter.
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7. COUNTERPARTS
This letter may be executed in any number of counterparts, and this has
the same effect as if the signatures on the counterparts were on a
single copy of this letter.
8. GOVERNING LAW
This letter is governed by and shall be construed in accordance with
English law.
Yours faithfully
/s/ ▇▇▇▇ ▇▇▇▇▇▇▇▇
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for and on behalf of
RBS MEZZANINE LIMITED
for and on behalf of
the Finance Parties
We hereby accept and agree to the terms and conditions of this letter.
/s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
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for and on behalf of
INVERNESS MEDICAL INNOVATIONS, INC.
for and on behalf of itself and
INVERNESS MEDICAL SWITZERLAND GMBH
Date 20.9.02
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