EXHIBIT A
BORROWING BASE CERTIFICATE (Dollars are stated in thousands)
To: Wells Fargo Bank, National Association
Date: ------------------------------
Subject: BORROWING BASE CERTIFICATE for Hauser Inc. ("Hauser") and its
subsidiaries:
Hauser Technical Services, Inc. ("HTS"), ZetaPharm, Inc. ("ZETA"), Wilcox
Natural Products, Inc. ("WILCOX"), and Botanicals International Extracts, Inc.
("EXTRACTS") (collectively, "Co-Borrowers")
In accordance with our Credit Agreement as of June 11, 1999, with subsequent
amendments (the "Credit Agreement"), set forth below is the calculation of the
Borrowing Base and Availability as of -----------------------------(the
"Reporting Date"). Unless defined herein, all capitalized terms used in this
certificate have the meanings given to them in the Credit Agreement. Unless
otherwise indicated, all amounts are as of the Reporting Date.
<TABLE>
<CAPTION>
CONSOLIDATED
CO-BORROWERS
HTS ZETA WILCOX EXTRACTS GRAND TOTAL
-----------------------------------------------------------
<S> <C> <C> <C> <C> <C>
A. ACCOUNTS RECEIVABLE ("A/R")
1.
Reconciliation from last month (a)
Previous aged trial balance as of
------------------
(b) add: gross A/R sales per sales
journal: less: credit memos to A/R
(c) Deduct: cash receipts per cash
receipts journal Cash discounts
(d) Sub-Total
(e) Journal entries debits (refund &
other) Credits: (writeoffs & other)
(f) Sub-Total (control balance as of
--------------------
(g) A/R Balance on general ledger
(explain any difference)
(H) TOTAL ACCOUNTS RECEIVABLE (THE
LESSER OF F AND G ABOVE)
(I) LESS: NUTRACO
(J) NET A/R SUBJECT TO 80% BORROWING
LIMITATION
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CONSOLIDATED
CO-BORROWERS
HTS ZETA WILCOX EXTRACTS GRAND TOTAL
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2. EXCLUSIONS FROM ACCOUNTS RECEIVABLE
(a) that portion of A/R not yet
earned by the final delivery of
goods or rendition of services
(b) A/R subject to contingencies
(c) A/R not providing for payment in
full within 120 daysOf shipment
date
(d) A/R over 60 days past due
(e) A/R owned by a shareholder,
subsidiary, affiliate, officer Or
employee of Hauser
(f) A/R in the form of progress
billings
(g) A/R owed by an account debtor that
is insolvent, the subject of
bankruptcy proceedings or has gone
out of business.
(h) A/R not subject to a duly perfected
first priority security interest In
favor of the Bank or which are
subject to any lien security
Interest or claim in favor of any
person other than the Bank
(i) that portion of A/R that
constitutes finance charges,
service charges or excise taxes
(j) that portion of A/R payable in a
currency other than US Dollars
(k) that portion of A/R due and
collectible outside the United
States
(l) A/R owing from account debtor
outside of the U.S. except for The
following Canadian provinces
(British Columbia, Alberta,
Saskachewan, Manitoba, Ontario and
Yukon).
(m) that portion of A/R, or portions
thereof, otherwise deemed
uncollectible for any reason by the
Bank
(n) that amount exceeding 25% of total
A/R outstanding from one account
debtor.
(o) A/R owing from U.S. or governmental
agency or entity
(p) A/R owing from an account debtor
whom Hauser is or may Be liable for
goods purchased from such account
debtor
(q) credits over 60 days past due
(r) excessive delinquency (amount
over 60 days past due
represents more than 20% of
total)
(s) total ineligibles (sum of line
2 (a) through 2(R)
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3. TOTAL ELIGIBLE RECEIVABLES
(LINE 1(J) LESS LINE 2(S))
CONSOLIDATED
CO-BORROWERS
HTS ZETA WILCOX EXTRACTS GRAND TOTAL
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B. INVENTORY
4. Total Inventory
5. Exclusions from Inventory
(a) work-in-progress
(b) in-transit, not under a letter of
credit, or not an approved site, on
consignment or subject to any
bailment
(c) proprietary software
(d) damaged, inventory in Hauser's
stock for greater than 18 months,
obsolete, returned, defective,
recalled or unfit for further
processing or not currently
saleable in the normal course of
Hauser's operations
(e) perishable or live
(f) returned, has attempted to return,
is in the process of returning or
intends to return to the vendor
thereof
(g) not subject to a duly perfected
first priority security interest in
favor of the Bank or which are
subject to any lien security
interest or claim in favor of any
person other than the Bank
(h) sample inventory, demonstration
inventory, or packaging materials
(i) otherwise deemed ineligible by the
Bank in its discretion (Potentially
obsolete as reviewed by Hauser)
(j) total ineligibles (sum of line 5(a)
through line 5(i))
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C. REAL ESTATE
CONSOLIDATED
CO-BORROWERS
HTS ZETA WILCOX EXTRACTS GRAND TOTAL
-----------------------------------------------------------
(a) Eligible Improved Real Estate
(b) Eligible Land
SUMMARY BORROWING BASE CERTIFICATE
CONSOLIDATED
CO-BORROWERS
HTS ZETA WILCOX EXTRACTS GRAND TOTAL
-----------------------------------------------------------
Reference: Exhibit A: Borrowing Base
Certificate - Worksheet For the month of:
--------------------
1. Total Accounts Receivable (from
line 1h)
2. Total Ineligible A/R (from line 2s)
3. TOTAL ELIGIBLE RECEIVABLES (line 1
minus line 2)
4. Total Inventory (from line 4)
5. Total Ineligible Inventory (from
line 5i)
6. TOTAL ELIGIBLE INVENTORY (line 4
minus line 5)
7. Borrowing Base:
a. 80% of Eligible Receivables (.80% x
line 3)
b. 90% of Eligible Nutraco A/R
c. 50% of Eligible Inventory (.5 x
line 6) subject to $9 million cap
d. 75% of Eligible Improved Real
Estate (line C-a)
e. 50% of Eligible Land (line C-b)
TOTAL AVAILABILITY
Additional availability for Hauser
8 a. Outstanding loan balance
b. Outstanding letter of credit
balance
c. TOTAL OUTSTANDINGS
<PAGE>
9 Available Credit/Payment Required
(total availability less total
outstanding)
Borrowers represent and warrant
that this Borrowing Base
Certificate is a true and correct
statement regarding the status of
the matters set forth herein.
Borrowers further represent and
warrant that no Default of Event of
Default has occurred and is
continuing. Borrowers acknowledge
that any advances made to Borrowers
under the Credit Agreement will be
based upon the Lender's reliance on
the information contained herein.
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Hauser, Inc.
By_______________________________
