UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): August 21, 2002
USANA Health Sciences, Inc.
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(Exact name of registrant as specified in its charter)
Utah 0-21116 87-0500306
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(State of Incorporation) (Commission File No.) (IRS Employer
Identification No.)
3838 West Parkway Boulevard
Salt Lake City, Utah 84120
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(Address of Principal Executive Offices, Zip Code)
Registrant's telephone number, including area code (801) 954-7100
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Item 5. Other Events
On August 21, 2002, the company entered into a Second Amendment to
Credit Agreement with Bank of America, N.A. The amendment changes the terms of
an earlier credit agreement, as amended, implementing changes requested by the
company. The prior agreement made available a revolving line of credit in the
amount of $12,500,000 and a term loan to the company in the amount of
$10,000,000.
Under the amended credit agreement, the company requested that the
revolving line amount be reduced to $10,000,000. The interest rate is computed
at the bank's Prime Rate or the London Inter-bank Offer Rate (LIBOR) adjusted by
features specified in the credit facilities. The company may choose to borrow at
the bank's publicly announced Prime Rate plus a margin per annum as specified in
the credit facilities or, at the option of the company, loans within the
approved commitment may be available in minimum amounts of $100,000 or more for
specific periods ranging from one to six months, at LIBOR plus a margin
specified in the credit facilities.
The amended credit agreement prohibits the pruchase, retirement or
redemption of the company's stock, except that from September 1, 2002 through
December 31, 2003, the company may purchase, retire, or redeem up to $5,000,000
of its capital stock and thereafter the company may purchase, retire, or redeem
capital stock in an aggregate amount not to exceed the sum of (1) 25% of the
cumulative net income of the company for all fiscal quarters after December 31,
2003, less (2) the cumulative amount of cash dividends paid on the company's
stock after December 31, 2003. This is expected to permit the company to
continue its previously announced and ongoing stock repurchase program by making
purchases in the open market within the limitation contained in the amendment to
the credit agreement.
The company may not declare or pay any cash dividends without the prior
written consent of Bank of America, except that after December 31, 2003, the
company may declare and pay cash dividends in an aggregate amount not to exceed
the sum of (1) 25% of the cumulative net income of the company less (2) the
cumulative amount of the company's common stock purchased, retired, or redeemed
after December 31, 2003. The amended credit agreement also contains restrictive
covenants requiring the company to maintain a minimum tangible net worth
according to ratios contained in the agreement.
The amended agreement expires September 1, 2004, unless terminated
earlier in accordance with its terms. Unmodified sections of the original
amended credit agreement remain in effect and unchanged by the second amendment.
A copy of the second amendment is filed with this report as an exhibit hereto.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS
(c) Exhibits
10.13 Second Amendment to Credit Agreement dated August 21, 2002
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
USANA, INC.
By: /s/ Gilbert A. Fuller
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Sr. Vice President and
Chief Financial Officer
Dated: August 23, 2002