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Title: |
Commitment Letter |
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Entities: |
Canadian Imperial Bank of Commerce; CIBC World Markets Corp.; J.P. Morgan Securities Inc.; JPMorgan Chase Bank; Lehman Brothers Inc.; Lehman Commercial Paper Inc.; McGraw-Hill Companies Inc.; NeighborCare, Inc.; Omnicare, Inc.; Omnicare, Inc.; Suntrust Capital Markets, Inc. |
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Date: |
2004 |
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Size: |
Preview shows 11KB of 63KB total |
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Price: |
$45 |
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ID: |
#375570 |
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JPMorgan Chase Bank J.P. Morgan Securities Inc. 270 Park Avenue New York, New York 10017 |
Lehman Commercial Paper Inc. Lehman Brothers Inc. 745 Seventh Avenue New York, New York 10019 |
SunTrust Bank SunTrust Capital Markets, Inc. 303 Peachtree Street, NE 24th Floor Atlanta, Georgia 30308 |
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Canadian Imperial Bank of Commerce CIBC World Markets Corp. 425 Lexington Avenue, New York, New York 10017 |
Merrill Lynch Bank USA Merrill Lynch, Pierce, Fenner & Smith Incorporated 4 World Financial Center New York, New York 10080 |
June 3, 2004
COMMITMENT LETTER
Omnicare, Inc.
1600 RiverCenter II
100 East RiverCenter Boulevard
Covington, Kentucky 41011
Attn: David W. Froesel, Jr.
Senior Vice President and
Chief Financial Officer
Ladies and Gentlemen:
This commitment letter agreement (together with all exhibits and schedules hereto, the ?Commitment Letter?) will confirm the understanding and agreement among JPMorgan Chase Bank (?JPMCB?), J.P. Morgan Securities Inc. (?JPMorgan?), Lehman Commercial Paper Inc., (?LCPI?), Lehman Brothers Inc. (?Lehman Brothers?), SunTrust Bank (?SunTrust?), SunTrust Capital Markets, Inc. (?SunTrust Capital Markets?) (Lehman Brothers, JPMorgan and SunTrust Capital Markets, collectively, are exclusive joint lead book-runners and exclusive joint lead arrangers, the ?Joint Lead Arrangers?), Canadian Imperial Bank of Commerce (?CIBC?), CIBC World Markets Corp. (?CIBC World Markets?), Merrill Lynch Bank USA (?Merrill Lynch?), Merrill Lynch, Pierce, Fenner & Smith Incorporated (?MLPFS?) and Omnicare, Inc., a Delaware corporation (together with each of its subsidiaries, the ?Company?), in connection with the proposed financing for the acquisition of all of the issued and outstanding common stock of NeighborCare, a Pennsylvania corporation (the ?Target? and, together with each of its subsidiaries, the ?Acquired Business?). We understand that the Company may acquire all of the issued and outstanding common stock of the Target (the ?Shares?) pursuant to a cash tender offer (the ?Tender Offer?) by a wholly-owned subsidiary of the Company (the ?Offer Subsidiary?) for all of the outstanding Shares, but for at least the number of outstanding Shares necessary to meet the Minimum Condition (as defined below), which Tender Offer would be expected to be
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followed by a merger (the ?Merger?) of the Offer Subsidiary with and into the Target. You have further advised us that in lieu of the Tender Offer and Merger, you may sign an agreement to acquire the Shares (an ?Acquisition Agreement?). The Tender Offer and the Merger (or alternatively, the consummation of the acquisition of all of the Shares pursuant to an Acquisition Agreement) are sometimes collectively referred to in this Commitment Letter as the ?Acquisition?.
You have advised us that the total funds needed to finance the Acquisition will be approximately $1.9 billion consisting of the following uses: (i) $1.335 billion for the acquisition of all of the issued and outstanding common stock of the Acquired Business, (ii) $250.0 million for the purchase of the 6.875% senior subordinated notes due 2013 (the ?6.875% Notes?) of the Acquired Business, (iii) $151.8 million for the refinancing of the existing term loan indebtedness of the Company, (iv) approximately $110.0 million for the refinancing of the existing revolving credit facility of the Company (based on the amount outstanding under such revolving credit facility as of the date hereof), (v) $33.8 million for the estimated premium payable in connection with the tender for the 6.875% Notes and (vi) $53.7 million for the estimated fees and expenses of the Company. Such funds will be provided from the following sources: (i) approximately $134.3 million (as such amount may be increased to the extent the amount outstanding under the Company?s existing revolving credit facility on the Closing Date exceeds $110.0 million or decreased to the extent the amount under the Company?s existing revolving credit facility on the Closing Date is less than $110.0 million, such adjusted amount, the ?Initial Revolver Draw Amount?) of borrowings by the Company under a $600.0 million Revolving Credit Facility, (ii) $700.0 million of borrowings by the Company under a Senior Term Loan Facility and (iii) $1.1 billion of borrowings by the Company under a 364-Day Facility (collectively, the ?Credit Facilities?). Following the consummation of the Acquisition, the Company and its subsidiaries will not have any debt outstanding except as described in this paragraph and the debt set forth on Part 1 of Schedule 1 hereto. As used below, the defined term ?Company? shall mean both the Company prior to the Acquisition and the Company together with the Acquired Business, after giving effect to the Acquisition.
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