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Exhibit 4.1
AMENDMENT NO. 3 AND WAIVER
TO CREDIT AGREEMENT
AMENDMENT NO. 3 AND WAIVER , dated as of December 8, 2006
(this "Amendment and Waiver") to the Credit Agreement, dated as of
January 28, 2005 (as amended, restated, modified or otherwise
supplemented, from time to time, the "Credit Agreement"), by and
among NATIONAL MEDICAL HEALTH CARD SYSTEMS, INC. (the
"Borrower"), JPMORGAN CHASE BANK, N.A. , as Administrative
Agent and the LENDERS from time to time party thereto (each,
a "Lender" and, collectively, the "Lenders").
WHEREAS , the Borrower has requested, and the Required
Lenders have agreed, subject to the terms and conditions of this
Amendment and Waiver, to amend and waive certain provisions of the
Credit Agreement as set forth herein.
NOW, THEREFORE, in consideration of the premises and of
the mutual agreements herein contained, the parties hereto agree as
follows:
1. Amendments .
a. The first sentence of the definition of "Consolidated EBITDA"
in Section 1.01 of the Credit Agreement is hereby amended and
restated in its entirety to provide as follows:
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" Consolidated EBITDA " means the sum of (i) net
income plus (ii) interest expense plus
(iii) income tax expense plus (iv) depreciation
and amortization expense, plus (v) non-cash
extraordinary losses, plus (vi) non-cash charges
incurred in connection with (a) accounting for stock-based
compensation expense and (b) changes to Statements of
Financial Accounting Standards, minus the sum of interest
income, all extraordinary or unusual gains, and any cash payments
made during such period with respect to the items described in
clause (vi)(b) above subsequent to the fiscal quarter in which the
relevant non-cash expense or loss was reflected as a charge on the
financial statements of the Borrower."
b. Section 6.04(b) of the Credit Agreement is hereby
amended and restated in its entirety to provide as follows:
c. Section 6.04 of the Credit Agreement is further amended
by adding a new subsection "(g)" at the end of such Section as
follows:
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"(g) without relieving the Borrower of its obligations under
Sections 5.09 and 5.10 hereof, if required at such time, the
formation of, and ownership of, stock in any newly created,
established or acquired Subsidiary of the Company."
2. Waivers.
The Lenders hereby waive compliance by the Borrower with the
Credit Agreement and the other Loan Documents, including, but not
limited to, Sections 5.01(b), 5.01(c) and 5.07 of the Credit
Agreement, and hereby waive any Event of Default that would arise
under the Credit Agreement, including, but not limited to, the
Event of Default that would arise under paragraphs (c),
(d) and (e) of Article VII of the Credit Agreement, each
with respect to (a) the late receipt of (i) the
Borrower’s consolidated balance sheet and related statements
of operations, stockholders’ equity and cash flows required
pursuant to Section 5.01(b) of the Credit Agreement and
(ii) the certificate of a Financial Officer of the Borrower
required pursuant to section 5.01(c) of the Credit Agreement, each
for the fiscal quarter ended September 30, 2006 and
(b) the failure of the Borrower to deliver the same to the
Securities and Exchange Commission, provided that such
statements and certificate, along with cash flow projections for
the fiscal quarter commencing January 1, 2007 and for the
three fiscal quarters ending thereafter (collective
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