FIRST AMENDMENT TO CREDIT AGREEMENT
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This FIRST AMENDMENT TO CREDIT AGREEMENT (this "Amendment") is entered into
as of August 21, 2007, by and among the lenders identified on the signature
pages hereof (such lenders, together with their respective successors and
permitted assigns, are referred to hereinafter each individually as a "Lender"
and collectively as the "Lenders"), XXXXX FARGO FOOTHILL, INC., a California
corporation, as the administrative agent for the Lenders (in such capacity,
together with its successors and assigns in such capacity, "Agent"), and ORION
HEALTHCORP, INC., a Delaware Corporation ("Company"), and each of the Company's
Subsidiaries thereto (Company and each Subsidiary individually a "Borrower" and
collectively, jointly and severally, the "Borrowers"), with respect to the
following:
A. The Borrowers, Agent and the Lenders have previously entered into that
certain Credit Agreement dated as of December 1, 2006 (as amended,
modified, renewed, extended, or replaced at any time or from time to time,
the "Credit Agreement").
B. The Borrowers, Agent, and the Lenders signatory hereto have agreed to amend
the Credit Agreement on the terms and subject to the conditions set forth
below.
NOW, THEREFORE, the parties hereto do hereby agree as follows:
1. Definitions Incorporated. Initially capitalized terms used but not
defined in this Amendment have the respective meanings set forth in
the Credit Agreement.
2. Amendments to Credit Agreement. The Credit Agreement is hereby amended
as follows:
(a) Schedule C-1 of the Credit Agreement is hereby amended by replacing
the sum of "$2,000,000" under the heading "Revolver Commitment" with
the sum of $2,500,000" and by replacing the sum of "$16,500,000" under
the heading "Total Commitment" with the sum of "$17,000,000".
(b) Section 6.16(a) of the Credit Agreement is hereby amended and restated
in its entirety as follows:
(a) Minimum TTM EBITDA. Fail to achieve TTM EBITDA, measured on a
month-end basis, of at least the required amount set forth in the
following table for the twelve month period ending as of the
measurement date set forth opposite thereto:
Applicable Amount Measurement Date
$2,000,000 June 30, 2007
$2,000,000 July 31, 2007
$2,000,000 August 31, 2007
$2,000,000 September 30, 2007
$2,000,000 October 31, 2007
$2,000,000 November 30, 2007
$2,000,000 December 31, 2007
$2,000,000 January 31, 2008
$2,000,000 February 29, 2008
$2,250,000 March 31, 2008
$2,250,000 April 30, 2008
$2,250,000 May 31, 2008
$2,500,000 June 30, 2008
$2,500,000 July 31, 2008
$2,500,000 August 31, 2008
$2,750,000 September 30, 2008
$2,750,000 October 31, 2008
$2,750,000 November 30, 2008
$3,400,000 December 31, 2008
$3,400,000 January 31, 2009
$3,500,000 February 28, 2009
$3,500,000 March 31, 2009
$3,600,000 April 30, 2009
$3,700,000 May 31, 2009
$3,700,000 June 30, 2009
$3,800,000 July 31, 2009
$3,800,000 August 31, 2009
$3,900,000 September 30, 2009
$4,000,000 October 31, 2009
$4,000,000 November 30, 2009
$4,100,000 December 31, 2009
$4,100,000 January 31, 2010
$4,200,000 February 28, 2010
$4,200,000 March 31, 2010
$4,300,000 April 30, 2010
$4,300,000 May 31, 2010
$4,400,000 June 30, 2010
$4,500,000 July 31, 2010
$4,500,000 August 31, 2010
$4,500,000 September 30, 2010
$4,600,000 October 31, 2010
$4,600,000 November 30, 2010
December 31, 2010 and for month ending
$4,750,000 thereafter
Concurrently with the closing of each Permitted Acquisition, the EBITDA levels
for each month shall be adjusted to 85% of TTM EBITDA for such month as set
forth in the most recent Projections of Parent (as adjusted to take into account
Projected Pro Forma Target EBITDA).
(c) Section 6.16(b) of the Credit Agreement is hereby amended and restated
in its entirety as follows:
(b) Fixed Charge Coverage Ratio. Have a Fixed Charge Coverage Ratio,
measured as of quarter-end, less than the required amount set forth in
the following table for the applicable period set forth opposite
thereto:
Applicable Ratio Applicable Period
For the fiscal quarter
1.40:1.00 ending March 31, 2007
For the two fiscal quarter period ending as of
1.40:1.00 June 30, 2007
For the three fiscal quarter period ending as of
1.40:1.00 September 30, 2007
For the four fiscal quarter period ending as of
1.40:1.00 December 31, 2007
For the four fiscal quarter period ending as of
1.40:1.00 March 31, 2008
For the four fiscal quarter period ending as of
1.20:1.00 June 30, 2008
For the four fiscal quarter period ending as of
1.20:1.00 September 30, 2008
For the four fiscal quarter period ending as of
1.20:1.00 December 31, 2008
For the four fiscal quarter period ending as of
March 31, 2009 and for each four fiscal quarter
1.20:1.00 period ending thereafter
(d) Section 6.16(c) of the Credit Agreement is hereby amended and restated
in its entirety as follows:
(c) Senior Leverage Ratio. Have a Senior Leverage Ratio, measured on
a month-end basis, more than the applicable ratio set forth in
the following table for the applicable date set forth opposite
thereto:
Applicable Ratio Applicable Date
2.50:1.00 December 31, 2006
2.50:1.00 January 31, 2007
2.50:1.00 February 28, 2007
2.50:1.00 March 31, 2007
2.50:1.00 April 30, 2007
2.25:1.00 May 31, 2007
2.85:1.00 June 30, 2007
2.85:1.00 July 31, 2007
2.85:1.00 August 31, 2007
2.85:1.00 September 30, 2007
2.85:1.00 October 31, 2007
2.85:1.00 November 30, 2007
2.85:1.00 December 31, 2007
2.75:1.00 January 31, 2008
2.75:1.00 February 29, 2008
2.75:1.00 March 31, 2008
2.50:1.00 April 30, 2008
2.50:1.00 May 31, 2008
2.50:1.00 June 30, 2008
July 31, 2008 and for each month
2.25:1.00 ending thereafter
3. Borrowing Base Multiple. The definition of "Borrowing Base Multiple"
in Schedule 1.1 of the Credit Agreement is hereby amended and restated
in its entirety as follows:
"Borrowing Base Multiple" means, as of any date of determination, (a)
2.85:1.00 from the date of the First Amendment to Credit Agreement
dated as of August 21, 2007 through December 31, 2007, (b) 2.75:1.00
from January 1, 2008 through March 31, 2008 and (c) 2.50:1.00
thereafter."
4. Amendment Fee. In addition to all other fees and charges, on the date
hereof, Borrowers will pay to Agent for the benefit of Lenders an
amendment fee of $100,000.
5. Conditions Precedent. The obligations of Agent and the Lenders
hereunder will be effective only upon satisfaction of each of the
following conditions precedent, each in a manner in form and substance
acceptable to Agent:
(a) Receipt by Agent of a fully-executed original of this Amendment;
(b) Receipt by Agent of the fee set forth in Section 3 hereof.
(c) After giving effect to Section 2(d) above, no Defaults or Events of Default
have occurred and are continuing; and
(d) Agent shall have received such other documents, certificates, opinions, and
information that Agent may require, each in form and substance satisfactory
to Agent in its sole discretion.
6. Borrowers' Representations and Warranties. To induce Agent and the
Lenders to enter into this Amendment, the Borrowers represent and
warrant to Agent and the Lenders as of the date hereof as follows: (a)
this Amendment has been duly executed and delivered by the Borrowers,
constitutes a legal and valid binding obligation of the Borrowers,
enforceable against Borrowers in accordance with its terms, and has
been duly authorized by all necessary corporate action; (b) the
representations and warranties contained in the Credit Agreement and
the other Loan Documents are, both before and after giving effect to
this Amendment, true and correct in all material respects, except (i)
where any such representation or warranty is already subject to a
materiality standard, in which case such representation or warranty is
true and correct in all respects, and (ii) to the extent any such
representation or warranty is expressly stated to have been made as of
a specific date, in which case each such representation and warranty
is true and correct as of such specific date; and (c) after giving
effect to Section 2(d) above, no Default or Event of Default has
occurred and is continuing.
7. Reaffirmation. Except as specifically modified by this Amendment, the
Credit Agreement and the other Loan Documents remain in full force and
effect in accordance with their respective terms and are hereby
ratified, reaffirmed and confirmed by the Borrowers.
8. Events of Default. Any failure to comply with the terms and conditions
of this Amendment will constitute an Event of Default under the Credit
Agreement.
9. Binding Effect; Benefits of Amendment. This Amendment shall be binding
upon, inure to the benefit of and be enforceable by the Borrowers, the
Agent, each Lender and their respective successors and permitted
assigns. This Amendment is entered into for the sole protection and
benefit of the Borrowers, the Agent, and the Lenders and their
successors and permitted assigns, and no other Person shall be a
direct or indirect beneficiary of, or shall have any direct or
indirect cause of action or claim in connection with, this Amendment.
10. Counterparts; Telefacsimile Execution. This Amendment may be executed
in any number of counterparts and by different parties hereto in
separate counterparts, each of which when so executed shall be deemed
to be an original and all of which taken together shall constitute but
one and the same agreement. Delivery of an executed counterpart of
this Amendment by telefacsimile or other electronic method of
transmission shall be equally effective as delivery of an original
executed counterpart of this Amendment. Any party delivering an
executed counterpart of this Amendment by telefacsimile or other
electronic method of transmission also shall deliver an original
executed counterpart of this Amendment but the failure to deliver an
original executed counterpart shall not affect the validity,
enforceability, and bind effect of this Amendment.
11. Governing Law. The validity of this Amendment and the construction,
interpretation, and enforcement hereof, and the rights of the parties
hereto with respect to all matters arising hereunder or related hereto
shall be determined under, governed by, and construed in accordance
with the laws of the State of New York. Section 12 of the Credit
Agreement is incorporated herein by reference.
12. Entire Agreement. This Amendment, together with the other Loan
Documents, reflects the entire understanding of the parties with
respect to the transactions contemplated hereby and shall not be
contradicted or qualified by any other agreement, oral or written,
before the date hereof.
THIS WRITTEN AGREEMENT REPRESENTS THE FINAL AGREEMENT BETWEEN THE PARTIES
AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR
SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES. THERE ARE NO UNWRITTEN ORAL
AGREEMENTS BETWEEN THE PARTIES.
As used in the preceding sentence, "written agreement" means all of the Loan
Documents, collectively, including this Amendment.
13. Costs and Expenses. The Borrowers agree to pay to each of Agent and
the Lenders on demand the reasonable out-of-pocket costs and expenses
of such Person, and the reasonable fees and disbursements of counsel
to such Person, in connection with the negotiation, preparation,
execution, delivery, and administration of this Amendment, and any
amendments, modifications, or waivers of the terms thereof. The
Borrowers agree to pay to Agent and the Lenders, on demand, all costs
and expenses of such Person, and the fees and disbursements of counsel
to such Person, in connection with the enforcement or attempted
enforcement of, and preservation of rights or interests under, this
Amendment, including any losses, costs and expenses sustained by such
Person as a result of any failure by any Borrower to perform or
observe its obligations contained in this Amendment.
[Remainder of Page Intentionally Left Blank]
IN WITNESS WHEREOF, the parties hereto have duly executed this Amendment as
of the date first written above.
ORION HEALTHCORP, INC.
By: /s/ Xxxxxxxx X. Xxxxx
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Title: President and CEO
INTEGRATED PHYSICIAN SOLUTIONS, INC.
By: /s/ Xxxxxxxx X. Xxxxx
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Title: President and CEO
MEDICAL BILLING SERVICES, INC.
By: /s/ Xxxxxxxx X. Xxxxx
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Title: CEO
ON-LINE ALTERNATIVES, INC.
By: /s/ Xxxxxxxx X. Xxxxx
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Title: CEO
ON LINE PAYROLL SERVICES, INC.
By: /s/ Xxxxxxxx X. Xxxxx
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Title: CEO
RAND MEDICAL BILLING, INC.
By: /s/ Xxxxxxxx X. Xxxxx
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Title: CEO
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XXXXX FARGO FOOTHILL, INC.,
a California corporation, as Agent and
as a Lender
By: /s/ Xxxxx Xxxxxx
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Vice President
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