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CONSENT AND THIRD AMENDMENT TO CREDIT AGREEMENT

Loan Agreement

CONSENT AND THIRD AMENDMENT TO CREDIT AGREEMENT | Document Parties: ADDUS HOMECARE CORP | Addus HealthCare (Nevada), Inc | Addus HealthCare, Inc | Greater Vegas Personal Care, LLC | Loan Parties, FREEPORT FINANCIAL LLC | Vegas Valley Personal Care, LLC You are currently viewing:
This Loan Agreement involves

ADDUS HOMECARE CORP | Addus HealthCare (Nevada), Inc | Addus HealthCare, Inc | Greater Vegas Personal Care, LLC | Loan Parties, FREEPORT FINANCIAL LLC | Vegas Valley Personal Care, LLC

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Title: CONSENT AND THIRD AMENDMENT TO CREDIT AGREEMENT
Governing Law: Illinois     Date: 7/17/2009
Law Firm: Winston Strawn    

CONSENT AND THIRD AMENDMENT TO CREDIT AGREEMENT, Parties: addus homecare corp , addus healthcare (nevada)  inc , addus healthcare  inc , greater vegas personal care  llc , loan parties  freeport financial llc , vegas valley personal care  llc
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Exhibit 10.8(c)

EXECUTION COPY

CONSENT AND THIRD AMENDMENT TO CREDIT AGREEMENT

CONSENT AND THIRD AMENDMENT TO CREDIT AGREEMENT (this “ Amendment ”), dated as of November 13, 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 that certain Consent and First Amendment to Credit Agreement dated as of July 29, 2007, that certain Consent and Second Amendment to Credit Agreement dated as of October 15, 2007 and as further amended, restated or otherwise modified including 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 (the “ Vegas Valley Acquisition ”) by Addus HealthCare (Nevada), Inc., a Delaware corporation and a wholly-owned Subsidiary of the Borrower (“ Addus Nevada ”), of substantially all of the assets of Vegas Valley Personal Care, LLC, a Nevada limited liability company (“ Vegas Valley ”) for an aggregate purchase price not to exceed $1,550,000 and (II) the acquisition (the “ Greater Vegas Acquisition ” and, together with the Vegas Valley Acquisition, the “ Vegas Acquisitions ”)) by Addus Nevada of substantially all of the assets of Greater Vegas Personal Care, LLC, a Nevada limited liability company (“ Greater Vegas ”) for an aggregate purchase price not to exceed $1,550,000.

C. Agent, Lenders and the Loan Parties 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 consent to Addus Nevada (i) entering into (v) that certain Asset Purchase Agreement, dated as of even date herewith (the “ Greater Vegas Purchase Agreement ”), by and between Addus Nevada, Greater Vegas, Fabiana Alfaro and Ema Gomez Mitchell, (w) that certain Asset Purchase Agreement, dated as of even date herewith (the “ Vegas Valley Purchase Agreement ”), by and between Addus Nevada, Vegas


Valley and Ema Gomez Mitchell, (x) that certain Consulting Agreement, dated as of even date herewith (the “ Vegas Consulting Agreement ”), by and between Addus Nevada and Ema Gomez Mitchell, (y) the Vegas Earn Out Agreement and (z) the other agreements, instruments and documents for the purpose of consummating the Vegas Acquisitions in each case on terms and conditions satisfactory to the Agent (the “ Vegas Acquisition Documents ”, it being agreed that the forms of the Greater Vegas Purchase Agreement, the Vegas Valley Purchase Agreement, the Vegas Consulting Agreement, the Vegas Earn Out Agreement and such other agreements, instruments and documents provided to the Agent on November 12, 2007 are satisfactory to the Agent); (ii) consummating the Vegas Valley Acquisition on the Third Amendment Effective Date for an aggregate purchase price not to exceed $950,000 paid in cash on the closing date thereof pursuant to the terms of the Vegas Acquisition Documents, plus a deferred purchase price in an amount not to exceed $600,000 paid to Vegas Valley pursuant to the Vegas Earn Out Agreement; and (iii) consummating the Greater Vegas Acquisition on the Third Amendment Effective Date for an aggregate purchase price not to exceed $950,000 paid in cash on the closing date thereof pursuant to the terms of the Vegas Acquisition Documents, plus a deferred purchase price in an amount not to exceed $600,000 paid to Greater Vegas pursuant to the Vegas Earn Out Agreement; provided that in each case such deferred purchase price shall not be paid 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 or the Borrower does not have the minimum Borrowing Availability required by Section 6.17 of the Credit Agreement after giving effect to such payment.

Section 3. Amendment to the Credit Agreement . As of the Third 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:

Greater Vegas has the meaning set forth in the Recitals to the Third Amendment.

Greater Vegas Acquisition has the meaning set forth in the Recitals to the Third Amendment.

Medicaid Investigation means the matters which were the subject of the investigation pursuant to (i) the Search Warrant, dated as of April 10, 2007, issued by the State of Nevada to any Peace Officer in the County of Clark related to Vegas Valley and (ii) the Search Warrant, dated as of April 10, 2007, issued by the State of Nevada to any Peace Officer in the County of Clark related to the Greater Vegas.

Third Amendment means that certain Consent and Third Amendment to Credit Agreement dated as of November 13, 2007 among the Loan Parties, Agent and the Lenders.

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

Third Amendment Reaffirmation of Collateral Documents means the Consent and Reaffirmation (Third Amendment) dated as of November 13, 2007 of the Loan Parties signatory thereto, in respect of the Collateral Documents.

 

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Vegas Acquisition Documents has the meaning set forth in Section 2 of the Third Amendment.

Vegas Acquisitions has the meaning set forth in the Recitals to the Third Amendment.

Vegas Earn Out Agreement means that certain Earn Out Agreement dated as of November 13, 2007 by and between Addus HealthCare (Nevada), Inc., Fabiana Alfaro, Ema Gomez Mitchell, Vegas Valley and Greater Vegas.

Vegas Valley has the meaning set forth in the Recitals to the Third Amendment.

Vegas Valley Acquisition has the meaning set forth in the Recitals to the Third Amendment.

3.2. Section 1.1 of the Credit Agreement is further amended by amending and restating the proviso at the end of the definition of “EBITDA” 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

December 31, 2006

  

$

4,331,076

March 31, 2007

  

$

3,574,099

June 30, 2007

  

$

3,690,092

Provided, further, that (i) for any period that includes the month of July of 2007, EBITDA shall, without duplication, be increased with respect to the assets acquired in connection with the SuCasa Acquisition, the Silver State Acquisition and the Vegas Acquisitions by an amount equal to $246,500 for such month, (ii) for any period that includes the month of August or September of 2007, EBITDA shall, without duplication, be increased with respect to the assets acquired in connection with the Silver State Acquisition and the Vegas Acquisitions by an amount equal to $180,000 for each such month and (iii) for any period that includes the month of October of 2007 to be increased with respect to the assets acquired in the Vegas Acquisitions by an amount equal to $117,000 for such month.”

3.3. Section 2.1(a)(v) of the Credit Agreement is hereby amended and restated in its entirety and replaced with the following new Section 2.1(a)(v) :

(v) Borrower shall repay the Term Loans through periodic payments on the dates and in the amounts indicated below (“ Scheduled Installments ”), and in any event the entire remaining principal balance shall be repaid on the Commitment Termination Date.

 

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Term Loan

 

Date

  

Scheduled Installment

December 31, 2007

  

$

1,140,000

March 31, 2008

  

$

1,140,000

June 30, 2008

  

$

1,140,000

September 30, 2008

  

$

1,140,000

December 31, 2008

  

$

1,535,000

March 31, 2009

  

$

1,535,000

June 30, 2009

  

$

1,535,000

September 30, 2009

  

$

1,535,000

December 31, 2009

  

$

1,930,000

March 31, 2010

  

$

1,930,000

June 30, 2010

  

$

1,930,000

September 30, 2010

  

$

1,930,000

December 31, 2010

  

$

2,325,000

March 31, 2011

  

$

2,325,000

June 30, 2011

  

$

2,325,000

September 19, 2011

  

$
 
 
 
 
 

25,805,000
or the outstanding
principal balance
of Term Loans
outstanding on
such date

The above scheduled installment amounts reflect the incurrence by the Borrower of the Delayed Draw Term Loans funded on the Third Amendment Effective Date and shall thereafter be increased in the manner set forth on Annex B to the Second Amendment to the extent any further Delayed Draw Term Loans are funded. The final installment payment shall in all events equal the entire remaining principal balance of the Term Loan (including any remaining principal balance of such Delayed Draw Term Loans). Amounts borrowed under this Section 2.1(a) and repaid may not be reborrowed.

At the request of the applicable Lender, the Term Loans shall be evidenced by promissory notes substantially in the form of Exhibit 2.1(a) (as amended, modified, extended, substituted or replaced from time to time, each a “ Term Note ” and, collectively, the “ Term Notes ”), and Borrower shall execute and deliver a Term Note to each such Term Lender. Each Term Note shall represent the obligation of Borrower to pay the amount of the applicable Term Lender’s Term Loan Commitment, together with interest thereon.”

3.4. Section 5.12 of the Credit Agreement is hereby amended by adding the following new paragraph (d) thereto:

“(d) In connection with the businesses acquired in the Vegas Acquisitions, the Borrower and its Subsidiaries shall use the new healthcare provider number obtained by the Borrower

 

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after the Second Amendment Effective Date and prior to the Third Amendment Effective Date. For purposes of clarification, neither Borrower nor any Subsidiary of the Borrower shall acquire or otherwise utilize any healthcare provider number used by Vegas Valley or Greater Vegas.”

3.5. Section 6.1 of the Credit Agreement is hereby amended by deleting the “and” at the end of clause (m)  thereof, deleting the “.” at the end of clause (n)  thereof and replacing it with “; and” and by adding the following new clause (o) :

“(o) Indebtedness in respect of the Vegas Earn Out Agreements.”

3.6. Section 6.3 of the Credit Agreement is hereby amended by deleting the “and” at the end of clause (m)  thereof, deleting the “.” at the end of clause (n)  thereof and replacing it with “; and” and by adding the following new clause (o) :

“(o) Borrower or a wholly-owned Subsidiary of Borrower may consummate the Vegas Valley Acquisition and the Greater Vegas Acquisition as of the Third Amendment Effective Date pursuant to the Vegas Acquisition Documents.”

3.7. Clause (d)  of Section 6.6 of the Credit Agreement is hereby amended by deleting the “and” before clause (iii) thereof and adding the following new language immediately at the end thereof:

“and (iv) Borrower or a wholly-owned Subsidiary of Borrower may consummate the Vegas Valley Acquisition and the Greater Vegas Acquisition on the Third Amendment Effective Date pursuant to the Vegas Acquisition Documents and all applicable law, provided that the V


 
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