EXHIBIT 1
LOAN AGREEMENT
between
AL CHEMY AS
and
DEN NORSKE BANK ASA
AUGUST 13, 2001
TABLE OF CONTENTS
Clause Page
------ ----
1. DEFINITIONS 3
2. AMOUNT AND GOAL 4
3. CONDITIONS FOR PAYMENT 5
4. AVAILABILITY 5
5. CURRENCY COMPOSITION 5
6. ADJUSTMENT IN COMPARISON TO USD 6
7. SECURITY 6
8. ASSURANCES FROM THE BORROWER 6
9. INTEREST 7
10. REPAYMENT 8
11. PAYMENTS 8
12. BORROWER'S OBLIGATIONS 9
13. DEFAULT 10
14. ALTERED CIRCUMSTANCES 11
15. OBLIGATION TO REPAY IN CORRECT CURRENCY 12
16. COMMISSIONS AND COSTS 12
17. NOTICES 13
18. CHOICE OF LAW 13
APPENDIX 1
ADVANCE REQUEST
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This loan agreement is entered into on August 13, 2001 between
(1) AL CHEMY AS, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇, ▇▇▇▇ ▇▇▇▇
Norwegian Register of Business Enterprises: NO
("Borrower")
and
(2) DEN ▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇, ▇▇▇▇
Norwegian Register of Business Enterprises: NO 810 506 482
("Lender").
1. DEFINITIONS
1.1 In this Loan Agreement, and in each document drawn up in connection with
it, the following words and expressions shall have the following
definitions:
"BUSINESS DAY" every regular business day for banks in Oslo, London,
and, in connection with payments under this Loan
Agreement, every other place where a deposit or payment
takes place in relation to this Loan Agreement;
"LIBOR" "London Interbank Offered Rate," i.e., the interest that
the Lender offers with respect to regular practice for
interbank lending in London for a period of time equal
to the applicable Interest Period for the share of the
loan amount in question in the respective currency
around 11:00 a.m. London time 2 Business Days before the
applicable Interest Period starts;
"DEFAULT" one or more of the conditions that are described in
Clause 13;
"NIBOR" "Norwegian Interbank Offered Rate," i.e., the interest
that is quoted by the Lender and which is displayed on
▇▇▇▇▇▇'▇ NIBO screen as DnB Eurorenter [Euro. interest]
Norwegian Crowns (DNOP) for lending in NOK for a period
equal to the applicable Interest Period for the share of
the loan amount in question
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about 12:00 p.m. Norwegian time 2 Business Days before
the applicable Interest Period starts;
"NOK" the legal currency in Norway;
"COLLATERAL" the property/assets that are given as security for the
Loan with respect to Clause 7.1;
"INTEREST PAYMENT DATE" the last day in an Interest Period;
"INTEREST PERIOD" the period of time that in accordance with Clause 9 is
the basis of the interest calculation;
"SECURITY DOCUMENTS" the documents described in Clause 7.1;
"REPAYMENT DATE" June 30, 2002;
"ADVANCE REQUEST" the borrower's written request for payment of the whole
or portions of the Loan containing information
concerning the desired payment date, where the money
should be paid, the amount, the currency combination,
and interest period; and
"ADVANCE DATE" the dates on which the whole or portions of the Loan are
paid.
2. AMOUNTS AND GOALS
2.1 The Lender will give the Borrower a monetary loan of USD 100,000,000
and/or the equivalent value in NOK ("Loan") on the conditions that
are specified in detail in this Loan Agreement.
2.2 To the extent that the Loan is not made use of, the Borrower can
cancel the entire or portions of the scope of the loan by reducing
the Loan accordingly. Such cancellation assumes 10 Business Days'
written advance notice to the Lender.
2.3 The Loan will be used to refinance the remaining loan of USD
73,000,000 with respect to the "Loan Facility Agreement" dated
December 28, 1998 with later additions, to finance AL Industrier AS
in connection with refinancing of the remaining loan of NOK
166,000,000 with respect to the "Loan Facility Agreement" between
the Lender and AL Industrier AS dated March 25, 1998 with later
additions, and to finance a capital contribution to Alpharma Inc.
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3. CONDITIONS FOR PAYMENT
3.1 The Lender is not obligated to pay any portion of the Loan unless
the Lender has received the following documents, satisfactory to the
Lender in form and content:
(i) This Loan Agreement bindingly signed by the Borrower.
(ii) An Advance Request.
(iii) Copies of the company registration certificate and bylaws for
the Borrower.
(iv) Copy of the resolutions of the board of directors for the
Borrower concerning making the Loan and granting the security.
(v) The Security Documents.
3.2 The documents in (i) - (iv) must be received by the Lender no later
than 3 Business Days prior to the first Advance Date.
3.2 The Lender can postpone the deadline for submitting one or more of
the aforementioned documents on conditions that the Lender finds
suitable. The Lender can require that every copy be certified as a
lawful copy.
4. AVAILABILITY
4.1 An advance can occur on every Business Day as of and including today
up to and including May 31, 2002 assuming that the conditions in
Clause 3 are fulfilled.
4.2 The Loan can be used as a revolving advance facility, i.e., that
every advance that falls due for payment can be advanced again
within the scope of this Loan Agreement.
5. CURRENCY COMPOSITION
5.1 At the beginning of every Interest Period, the Borrower can
determine the distribution of USD and NOK on its own -- even such
that the Loan can be owing in just one currency -- assuming that
written notice of the desired distribution is given to the Lender no
less than 3 Business Days prior to a new Interest Period, and that
the Loan is never outstanding for more than 2 tranches and that each
tranche comprises a minimum of the equivalent value of
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USD 10,000,000, measured with respect to the currency exchange rate
2 Business Days prior to the start of the applicable Interest
Period.
5.2 If there is no notice, the Borrower will be considered to have
requested the same distribution as in the previous Interest Period.
5.3 In the event that USD are not accessible to the Lender at the point
in time in question, the Lender can consider it as the desire of the
Borrower that the share of the Loan in question be owing in NOK.
6. ADJUSTMENT IN COMPARISON TO USD
6.1 The reference currency is USD, which means that for every new
Interest Period the outstanding Loan from the preceding Interest
Period is converted into USD, and the outstanding Loan desired for
the new Interest Period will be fixed by converting from USD. The
applicable exchange rate is the rate 2 Business Days prior to the
start of the applicable Interest Period. If the equivalent value in
USD of the outstanding Loan on this day is greater than the amount
that would have been outstanding if the Loan had been granted in
USD, the Borrower will after notice from the Lender pay the
difference to the Lender no later than 2 Business Days after having
received such notice.
7. SECURITY
7.1 The Loan with all interest and costs, and every obligation that
stems from a connection with it, will be secured by:
(i) Collateral in all shares belonging to AL Industrier AS in the
following companies: Dynal Biotech ASA, AS Nopal, AS Wangs
Fabrik, and AL Chemy AS.
7.2 In the event of conflict between the Security Documents and this
Loan Agreement, the latter will take precedence.
7.3 Regardless of the currency the security's face value is in, the
provision in Clause 15.1 applies.
8. ASSURANCES FROM THE BORROWER
8.1 The Lender places the Loan at the disposal of the Borrower in
reliance on the Borrower's assurance, which is considered to be
granted by the signature on this Loan Agreement and repeated on the
occasion of each Advance Request, if:
(i) Default has not occurred;
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(ii) The Borrower is not aware of any circumstances which could
lead to default occurring by means of a notice of termination,
the expiration of a deadline, or the like; and
(iii) The Borrower is not aware that any company, any private person
or public authority has filed or has as its intention to file
or initiate any case or judicial inspection against the
Borrower that in a material may make it difficult for the
Borrower to fulfill its obligations according to this Loan
Agreement.
8.2 Unless the Borrower has notified the Lender explicitly at least 3
Business Days prior to the expiration of an Interest Period of
something else, the Borrower is considered to have repeated the
assurances in 8.1 above at the expiration of the Interest Period.
8.3 The Borrower will indemnify the Lender for every loss and every fee
that is a result of the Lender having adapted itself to the
Borrower's assurances with respect to 8.1 and 8.2 above.
9. INTEREST
9.1 The Borrower will pay interest on the portion of the Loan
outstanding at all times according to a per annum interest rate that
will be the sum of:
(i) LIBOR for USD, possibly NIBOR for NOK; and
(ii) a margin of 2.25% per annum. The margin is assumed to increase
by 0.5% per annum to 2.75% per annum as of and including the
point in time that Alpharma Inc. has taken over operational
control from Mayne ▇▇▇▇▇▇▇▇ Limited over companies and assets
that consist of and comprise ▇. ▇. ▇▇▇▇▇▇▇▇ & Co. Limited's
generic tablet and capsule production ("The FIG transaction")
and is assumed to increase by an additional 1% per annum to
3.75% per annum for the period that the stock in Alpharma Inc.
may be quoted at a value that corresponds to less than 66.6%
of the average price calculated for a period of two months
following (i) the date the FIG transaction is made public, or
(ii) the date when the FIG transaction is formally carried
out, however such that whichever of the alternatives (i) or
(ii) gives the lowest average price will apply. Independent of
the margin increases named above, possible future margin
reductions will be undertaken according to a more detailed
agreement between the parties. The margin development for
Alpharma Inc. under this party's syndicated loan facility will
serve as the basis for a new margin stipulation of this type
under the current Loan Agreement.
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9.2 With a minimum of 3 Business Day's written notice to the Lender, the
Borrower can opt for Interest Periods of 1, 3, 6, or 12 months. If
no notice is received, the Interest Period will be 3 months. The
Borrower can choose an Interest Period of 1 month a maximum of 3
times per twelve-month period.
9.3 If the Interest Period runs from the last Business Day in a month,
it will expire on the last Business Day of the month in question. If
the last day in an Interest Period were otherwise to fall on a day
which is not a Business Day, the Interest Period will be extended to
the next Business Day that follows in the same month, or if there is
no such day, the Interest Period will be shortened such that it
expires on the on the first Business Day prior.
9.4 The interest is paid at the end of the payment period on every
Interest Payment Date, but such that if the Interest Period is
longer than 6 months, the interest will in addition be paid every
6th month.
9.5 Interest accrues day by day and is limited to the real number of
days, on the basis a 360-day year.
10. REPAYMENT
10.1 Every advance is due for payment (with the limitation that follows
from Clause 4.2) on the applicable Interest Payment Date. The loan
with accrued unpaid interest and costs will be repaid in its
entirety on the Repayment Date.
10.2 If repayment occurs on a date other than the last day of the
Interest Period, or in another manner in conflict with the
aforementioned provision, the Borrower must compensate the Lender
for any loss, loss of net profits and extra costs that the Lender
might thereby incur.
11. PAYMENTS
11.1 All payments that the Borrower will undertake in accordance with
this Loan Agreement will be made to the Lender with funds that are
available the same day and to those accounts that the Lender
indicates. If the due date does not fall on a Business Day, payment
must be received into the payment account agreed upon on the first
following Business Day assuming that this falls in the same calendar
month, or if there is no such date, payment must be received no
later than the last Business Day prior to the due date.
11.2 Payment of principal and interest, as well as possible early
repayment, will occur with respect to the currency composition that
has been applying in the prior Interest Period. Payment of costs
will occur in the currency the costs are incurred in, in accordance
with a statement from the Lender.
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11.3 All payments from the Borrower under this Loan Agreement will be
made without any form of offset, and without any deductions being
made for possible taxes, fees, or similar expenses. If a deduction
of this type must be made as a result of law, administrative
regulation, or other binding unilateral directive, the Borrower will
pay a sum sufficient for the Lender to receive the full amount that
is due all the same.
11.4 If the Borrower does not pay the sum that is owing by the due date,
the Borrower will pay past due interest on the amount owing from the
due date until the payment takes place, according to a per annum
interest rate that is determined as the sum of:
(i) a margin with respect to Clause 9.1 (ii) above;
(ii) a default margin of 3% per annum; and
(iii) the Lender's costs for financing the sum defaulted for the
period of time specified by the Lender.
Past due interest will be paid immediately upon request from the Lender.
In addition to past due interest as specified above, the Borrower will
compensate the Lender for all losses and/or expenses that result from the
defaulted sum not having been paid by the due date.
12. BORROWER'S OBLIGATIONS
12.1 As regards the Lender, the Borrower undertakes, as long as any sum
remains owing under this Loan Agreement, to:
(i) Notify the Lender immediately of any Default, and of any
circumstance that the Borrower is aware of or should be aware
of which might lead to Default;
(ii) Supply to the Lender a copy of the Borrower's audited annual
report within 120 days following the start of a new year;
(iii) Upon request from the Lender, immediately provide such
information regarding its economic situation that the Lender
requests;
(iv) Not to sell or further mortgage any of its assets without the
Lender's written consent;
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(v) See to it that all receipts from sales of assets (i.e., net
proceeds after covering tax obligations that arise in such a
sale) are used in full to pay off the Loan;
(vi) Neither take out another loan, nor undertake security
responsibilities, nor make investments without the Lender's
written consent; and
(vii) Not pay out proceeds, or in another way, look after its owners
in the form of payments beyond the regular dividends up to NOK
12,000,000 all together without the Lender's written consent.
13. DEFAULT
13.1 The Loan will be considered to have been defaulted on by the
Borrower in the following situations:
(i) If payment of principal, interest, or other sum that should be
paid with respect to this Loan Agreement does not take place
at the appropriate time;
(ii) If the Borrower breaks or fails to fulfill any obligations
according to this Loan Agreement or the Security documents,
and the circumstances, if they can be corrected in the
Lender's opinion, are not corrected within 10 Business Days of
the time the Lender has requested it;
(iii) If any of the Borrower's other loans, securities, or debt
obligations are called in for payment before the due date
agreed upon because of the Borrower's default, or the Borrower
does not pay the amount owing in such circumstances at the
proper time, or securities that were placed for such another
loan, security, or other debt obligation can be sold;
(iv) If the Borrower files for bankruptcy, enters into debt
restructure proceedings of any kind, ceases its payments, or
admits to being insolvent;
(v) If the Borrower has given the Lender erroneous or insufficient
information about any essential point that can have or come to
have significance for the Borrower's obligations under this
Loan Agreement and ability to fulfill these obligations;
(vi) If the Borrower ceases or threatens to cease its business
operations, or without written consent from the Lender,
relinquishes a significant portion of its
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business operations, or a significant portion of the
Borrower's assets are the object of attachment or a judicial
lien;
(vii) If ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ and his children and grandchildren as
well as the EWS foundation at some point in time own, directly
or through family-owned companies, all together own less than
40% of all the shares in AL Industrier AS;
(viii)If the stock in Alpharma Inc., at any point in time before AL
Industrier AS has liquidated its ownership interest in Dynal
Biotech ASA, is listed at a value that corresponds to less
than 50% of the average price calculated for a period of two
months after (i) the date when the FIG transaction is made
public, or alternatively (ii) the date when the FIG
transaction is formally executed, such that whichever of the
alternatives (i) or (ii) above gives the lowest average stock
price will apply, or if the stock in Alpharma Inc. at any
point in time during this Loan Agreement is quoted at less
than USD 10; or
(ix) If a situation arises which in the Lender's opinion entails
reasonable grounds to suppose that the Borrower will not be
able to fulfill its obligations in accordance with this Loan
Agreement.
13.2 If one or more of the aforementioned Default situations arises, the
Lender has the right to demand that the entire Loan with interest
and costs be repaid immediately, or if the Loan has still not been
paid out, not to pay out the Loan.
14. ALTERED CIRCUMSTANCES
14.1 If
(i) as a result of law or administrative regulation it becomes
illegal for the Lender to offer the Loan or
(ii) the Lender finds that USD are no longer convertible or
accessible when paying out or on the Interest Payment Date;
the Lender, if the Borrower requests it and (i) above does not form
an obstacle to it, offers or maintain the Loan in NOK on terms that
the Lender establishes, alternatively the Lender's obligations
according to this Loan Agreement will cease immediately and all
outstanding obligations for the Borrower according to this Loan
Agreement will immediately fall due for payment.
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14.2 If Norwegian or other official authorities pass a resolution that
results in increased costs or reduced net earnings for the Lender in
conjunction with the Lender's obligation to pay out or maintain the
Loan, including resolutions that alter the Lender's need for equity
capital, the calculation of this and/or the balance sheet entries'
risk weightings in relation to the risk adjusted basis of
calculation for equity capital needs, the Lender will notify the
Borrower as soon as possible concerning what amount the Borrower
must repay to compensate for the Lender's increased costs or reduced
net earnings. This does not apply to increased costs or reduced
earnings that result from general tax regulations of significance
for the Lender's annual income. The amount will be paid by the
Borrower on the later alternative of either the first Interest
Payment Date or 5 Business Days after the Borrower has received such
notice. In such situations, the Lender will have access to pay off
the Loan early, but such that the Borrower will not fully compensate
the Lender according to the stipulations in Clause 10.2 for
increased costs or reduced net earnings in the period up to and
including the date when early repayment takes place.
15. OBLIGATION TO REPAY IN CORRECT CURRENCY
15.1 The Borrower's obligations according to this Loan Agreement will not
be considered settled until the Lender has received full settlement
in the currency the obligation is in. If a sum received after forced
collection of the Borrower's obligations, upon receipt, after
conversion to the applicably currency, result in a sum that is less
than the amount owing in the currency in question, the Lender can
claim the difference from the Borrower and this claim will be
considered as an independent claim against the Borrower, however
such that it is still secured by the collateral.
16. COMMISSIONS AND COSTS
16.1 The Borrower will pay a contingency commission of 0.5% per annum of
the expressed share of the Loan less the sum of (i) USD 73,000,000
and (ii) the value in USD that is equivalent at the time of the
payment to NOK 166,000,000, calculated from today up to the point in
time when the Loan is drawn in its entirety or May 31, 2002 (cf.
Clause 4.1). The commission is due for payment at the end of each
quarter.
16.2 The Borrower pays on the first Advance Date, but no later than 5
Business Days from today, a preparer's commission of 0.35% of the
Loan less the commission of NOK 100,000 already paid.
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16.3 If the Loan is still outstanding as of February 1, 2002, the
Borrower pays an additional commission of 0.15% of the outstanding
amount of the Loan, payable no later than 5 Business Days after this
date.
16.4 Regardless of whether the Loan is drawn or not, the Borrower will
immediately upon request pay the Lender all the costs and expenses
(including the taxes and internal fees and royalties) that accrue
for the Lender in conjunction with the preparation of this Loan
Agreement and the Security Documents, and in conjunction with
maintaining, using, or performing the Lender's rights according to
this Loan Agreement or Security Documents or in conjunction with the
Loan Agreement or Security Documents for that matter.
17. NOTICES
17.1 All notices or demands in conjunction with this Loan Agreement will
be written and will be sent by letter or fax. If the notification is
sent by fax, it will be confirmed by letter if the recipient
requests it.
17.2 Notices to the Lender or Borrower will be sent to the addresses
below:
Borrower:
AL Chemy AS
▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇
▇▇▇▇ ▇▇▇▇
[Norway]
Fax: ▇▇▇ ▇▇ ▇▇ ▇▇ ▇▇
Lender:
Den norske Bank ASA
0021 Oslo
[Norway]
Attn: Kredittadministrasjon Land [Credit Administration, Land]
Fax: ▇▇▇ ▇▇ ▇▇ ▇▇ ▇▇
or to such an address as the parties might offer information of in
writing.
18. CHOICE OF LAW
18.1 Conflicts that might arise in connection with this Loan Agreement
and which cannot be resolved amicably, will be resolved according to
Norwegian law, by Norwegian courts, and in the jurisdiction of the
Lender's choice.
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This Loan Agreement was prepared in 2 copies, of which each party retains its
own.
Borrower:
AL CHEMY AS
/s/ ▇. ▇. ▇▇▇▇▇▇▇▇
--------------------------
Print name: ▇. ▇. ▇▇▇▇▇▇▇▇
Lender:
for DEN NORSKE BANK ASA
/s/ ▇▇▇▇ ▇▇▇▇▇▇
--------------------------
Print name: ▇▇▇▇ ▇▇▇▇▇▇ Dep. Managing Director
EGJ/abf691
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APPENDIX 1
From: AL Chemy AS
To: Den norske Bank ASA
Kredittadministrasjon Land
Fax Number: ▇▇▇ ▇▇ ▇▇ ▇▇ ▇▇
Date:___________________
ADVANCE REQUEST
This is in reference to the loan agreement dated August 13, 2001 ("Loan
Agreement") entered into between us as the Borrower and Den norske Bank ASA.
Words and expressions defined in the Loan Agreement are used here in the same
sense as in the Loan Agreement.
We hereby give you irrevocable notice that on the ___________ 200_ we would like
to deduct USD/NOK _______________________ according to the Loan Agreement on the
terms that appear there.
The Interest Period for the aforementioned advance will be ___ months.
The amount, less possible commissions and costs with respect to clause 16, is to
be transferred to account number _______________ belonging to _____________ in
_____________.
As of today, there has arisen no circumstance that comprises or could lead to a
Default under the Loan Agreement.
If an advance, for reasons outside the Lender's control, should not take place
on the aforementioned date, we confirm that we will indemnify you for possible
losses and accrued costs.
Sincerely,
AL Chemy AS
______________
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