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CONSENT AND FIRST AMENDMENT TO CREDIT AGREEMENT

Loan Agreement

CONSENT AND FIRST AMENDMENT TO CREDIT AGREEMENT | Document Parties: ADDUS HOMECARE CORP | Addus HealthCare (Nevada), Inc | Addus HealthCare, Inc | Loan Parties, FREEPORT FINANCIAL LLC | Moore Home Health Care, Inc | Nevada LLC | SuCasa Personal Care, LLC You are currently viewing:
This Loan Agreement involves

ADDUS HOMECARE CORP | Addus HealthCare (Nevada), Inc | Addus HealthCare, Inc | Loan Parties, FREEPORT FINANCIAL LLC | Moore Home Health Care, Inc | Nevada LLC | SuCasa Personal Care, LLC

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Title: CONSENT AND FIRST AMENDMENT TO CREDIT AGREEMENT
Governing Law: Illinois     Date: 7/17/2009
Law Firm: Nixon Peabody;Winston Strawn    

CONSENT AND FIRST AMENDMENT TO CREDIT AGREEMENT, Parties: addus homecare corp , addus healthcare (nevada)  inc , addus healthcare  inc , loan parties  freeport financial llc , moore home health care  inc , nevada llc , sucasa personal care  llc
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Exhibit 10.8(a)

EXECUTION COPY

CONSENT AND FIRST AMENDMENT TO CREDIT AGREEMENT

CONSENT AND FIRST AMENDMENT TO CREDIT AGREEMENT (this “ Amendment ”), dated as of July 29, 2007, among Addus HealthCare, Inc., an Illinois corporation (“ Borrower ”), the other persons signatory hereto as “Loan Parties”, FREEPORT FINANCIAL LLC, a Delaware limited liability company (“ Agent ”) and the Lenders signatory hereto. Terms not defined herein have the meanings given to them in the Credit Agreement (as hereinafter defined).

RECITALS

A. Borrower, the Loan Parties, the Lenders signatory thereto and Agent are party to that certain Credit Agreement dated as of September 19, 2006 (as amended by this Amendment, the “ Credit Agreement ”).

B. Borrower, the Loan Parties, the Lenders and Agent are entering into this Amendment in connection with (I) the acquisition by Addus HealthCare (Nevada), Inc., a Delaware corporation (“ Addus Nevada ”), of certain assets and intellectual property of SuCasa Personal Care, LLC (“ SuCasa ”) and Desert PCA of Nevada LLC (“ Desert ”, and, collectively with SuCasa, the “ SuCasa Companies ”), for an aggregate purchase price of not more than $3,500,000 (the “ SuCasa Acquisition ”) and (II) the acquisition within ninety (90) days of the First Amendment Effective Date (the “ Moore Acquisition ”) by the Borrower or a wholly-owned Subsidiary of the Borrower of all of the shares of capital stock of Moore Home Health Care, Inc., an Indiana corporation (“ Moore ”) for an aggregate purchase price not to exceed $375,000.

C. Agent and Lenders are willing to enter into this Amendment upon the terms and conditions set forth below.

NOW THEREFORE, in consideration of the matters set forth in the recitals and the covenants and provisions herein set forth, and other valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:

AGREEMENT

Section 1. Definitions . Capitalized terms used herein and not otherwise defined herein shall have the meanings ascribed thereto in the Credit Agreement.

Section 2. Consent . Agent and the Lenders hereby (A) consent to Addus Nevada (i) entering into that certain Asset Purchase Agreement, dated as of July 29, 2007, by and among Addus Nevada, the SuCasa Companies, the Sellers’ Representative named therein (in such capacity, the “ Sellers’ Representative ”) and the Sellers set forth on Exhibit A thereto (the “ SuCasa Asset Purchase Agreement ”), that certain promissory note in the original principal amount of $250,000, dated as of July 29, 2007 (as the same may be amended or modified as permitted by the Credit Agreement, the “ SuCasa Note ”), made by Addus Nevada in favor of Sellers’ Representative and such documents executed and delivered to the SuCasa Companies


pursuant to the SuCasa Asset Purchase Agreement (the “ SuCasa Acquisition Documents ”) and (ii) consummating the SuCasa Acquisition on the First Amendment Effective Date pursuant to the terms and conditions of the SuCasa Acquisition Documents and this Amendment for an aggregate purchase price not to exceed $1,750,000 in cash on the First Amendment Effective Date and no more than an additional $1,500,000 in cash following the First Amendment Effective Date to be paid at the times and in the manner specified in the SuCasa Asset Purchase Agreement provided that such payments shall not be made in the event that any Default or Event of Default under any of Sections 7.1 or 8.1(a) of the Credit Agreement has occurred and is continuing or would result therefrom; (B) consent to the Borrower or a wholly-owned Subsidiary of Borrower (i) entering into documentation with respect to the Moore Acquisition on terms and conditions satisfactory to the Agent (the “ Moore Acquisition Documents ”); and (ii) consummating the Moore Acquisition on or after the First Amendment Effective Date for an aggregate purchase price not to exceed $325,000 in cash on the closing date thereof pursuant to the terms of the Moore Acquisition Documents plus certain deferred purchase price owed to the sellers of Moore in an amount not to exceed $50,000; and (C) agree that for purposes of calculating any Excess Cash Flow prepayment amount that may be due in respect of any Fiscal Year pursuant to Section 2.5(b) of the Credit Agreement, (i) the unfinanced amount of the purchase price paid in cash during such Fiscal Year for the Moore Acquisition and (ii) the unfinanced installment payments made during such Fiscal Year pursuant to the SuCasa Acquisition Documents shall be deducted from the “Subtotal” determined as part of the calculation for “Excess Cash Flow” set forth on Schedule 2 to Annex E of the Credit Agreement prior to applying the “Required Prepayment Percentage” set forth on such Schedule.

Section 3. Amendment to the Credit Agreement . As of the First Amendment Effective Date, the Credit Agreement is hereby amended as follows:

3.1. Section 1.1 of the Credit Agreement is hereby amended by adding the following new definitions thereto:

Addus Nevada means Addus HealthCare (Nevada), Inc., a Delaware corporation.

First Amendment means that certain Consent and First Amendment to Credit Agreement dated as of July 29, 2007 among the Loan Parties, Agent and the Lenders.

First Amendment Effective Date has the meaning set forth in the First Amendment.

Moore has the meaning set forth in the Recitals to the First Amendment.

Moore Acquisition has the meaning set forth in the Recitals to the First Amendment.

Moore Acquisition Documents has the meaning set forth in Section 2 of the First Amendment.

Reaffirmation of Collateral Documents means the Consent and Reaffirmation dated as of July 29, 2007 of the Loan Parties signatory thereto, in respect of the Collateral Documents.

 

2


SuCasa Acquisition has the meaning set forth in the Recitals to the First Amendment.

SuCasa Acquisition Documents has the meaning set forth in Section 2 of the First Amendment.

SuCasa Asset Purchase Agreement has the meaning set forth in Section 2 of the First Amendment.

SuCasa Companies has the meaning set forth in the Recitals to the First Amendment.

SuCasa Note has the meaning set forth in Section 2 of the First Amendment.

3.2. Section 1.1 of the Credit Agreement is further amended by amending the definition of “EBITDA” by deleting the word “and” that immediately precedes “(xiv)” and replacing it with “,” and adding the following language immediately after clause (xiv) therein:

“, and (xv) in connection with calculating any monthly financial statements required by Section 7.2(a) for any period which includes the month of September, 2006, without duplication, the one-time charge of $146,431 expensed pre closing in September 2006 in connection with an audit conducted by the U.S. Department of Labor;”

3.3. The proviso at the end of the definition of “EBITDA” is amended and restated in its entirety to read as follows:

provided , that, notwithstanding anything to the contrary contained herein, for each of the Fiscal Quarters listed below, EBITDA shall be deemed to be the amount set forth below opposite such corresponding period:

 

Period

  

EBITDA

 

September 30, 2006

  

$

3,563,347

1  

December 31, 2006

  

$

3,843,068

  

March 31, 2006

  

$

3,062,914;

  

Provided, further, that for any period that includes the month of April, May, June or July of 2007, EBITDA shall, without duplication, be increased with respect to the assets acquired in connection with the SuCasa Acquisition by an amount equal to $71,897 for each such month.”

3.4. Section 6.1 of the Credit Agreement is hereby amended by deleting the “and” at the end of clause (i)  thereof, deleting the “.” at the end of clause (j)  thereof and replacing it with “;” and by adding the following new clauses (k), (l) and (m) :

“(k) Indebtedness in respect of that certain 8% Junior Subordinated Promissory Note by Addus Nevada payable to Glen Schlosser, as Seller’s Representative (on behalf the Sellers (as defined in the SuCasa Asset Purchase Agreement)), in the original principal amount of $250,000;

 

1

This figure includes the one-time charge of $146,431 expensed pre closing in September 2006 in connection with an audit conducted by the U.S. Department of Labor.

 

3


“(l) Indebtedness for the deferred purchase price in connection with the Moore Acquisition up to $50,000; and

(m) Indebtedness consisting of surety bonds issued to licensing authorities in connection in the ordinary course of business in an aggregate amount for all such surety bonds not to exceed $250,000 outstanding at any time.”

3.5. Section 6.3 of the Credit Agreement is hereby amended by deleting the “and” at the end of clause (j)  thereof, deleting the “.” at the end of clause (k)  thereof and replacing it with “;” and by adding the following new clauses (l) and (m) :

“(l) Addus Nevada may consummate the SuCasa Acquisition as of the First Amendment Effective Date pursuant to the SuCasa Acquisition Documents; and

(m) Borrower or a wholly-owned Subsidiary of Borrower may consummate the Moore Acquisition within ninety (90) days of the First Amendment Effective Date pursuant to the Moore Acquisition Documents and all applicable law, provided that the Moore Acquisition Documents shall have been duly authorized, executed and delivered by each of the respective parties thereto and shall be in full force and effect and provided further that the Agent shall have received a complete copy of the fully executed Moore Acquisition Documents, certified by the Borrower as being true, complete and correct.”

3.6. Clause (d)  of Section 6.6 of the Credit Agreement is hereby amended and restated in its entirety to read as follows:

“(d) acquire by purchase or otherwise all or any part of the Stock, business or assets of any other Person, provided that (i) Addus Nevada may consummate the SuCasa Acquisition as of the First Amendment Effective Date pursuant to the SuCasa Acquisition Documents; and (ii) Borrower or a wholly-owned Subsidiary of Borrower may consummate the Moore Acquisition on or after the First Amendment Effective Date pursuant to the Moore Acquisition Documents and all applicable law, provided that the Moore Acquisition


 
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