Exhibit 10.2
FOURTH AMENDMENT TO LOAN AND SECURITY AGREEMENT
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This Fourth Amendment to Loan and Security Agreement ("Amendment") is
made this 26th day of May, 2004 by and among by and among the lending
institutions listed in Annex I to the Loan Agreement (as defined below) (each a
"Lender", and collectively, "Lenders"), Fleet capital corporation, a Rhode
Island corporation with an office at 000 Xxxxxxxxxxx Xxxxxxxxx, Xxxxxxxxxxx, XX
00000, as administrative agent for the Lenders ("Agent"), and Gentiva Health
Services, Inc., a Delaware corporation with its chief executive office at 0
Xxxxxxxxxx Xxxxxxxxxx 0X, Xxxxxxxx, XX 00000 (the "Company"), Gentiva Health
Services Holding Corp., a Delaware corporation with its chief executive office
at 0 Xxxxxxxxxx Xxxxxxxxxx 0X, Xxxxxxxx, XX 00000 ("GHS"), and each of the
Subsidiary Borrowing Corporations listed on the signature pages hereto, each
with a state of incorporation and chief executive office as listed on the
exhibits to the Loan Agreement (except in the case of Gentiva Health Services
IPA, Inc., which is a New York corporation with its chief executive office at 0
Xxxxxxxxxx Xxxxxxxxxx 0X, Xxxxxxxx, XX 11747) (each of the Company, GHS and each
Subsidiary Borrowing Corporation, a "Borrower," and collectively, "Borrowers").
BACKGROUND
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A. Borrowers, Agent and Lenders are parties to a certain Loan and
Security Agreement dated June 13, 2002, as amended by that certain First
Amendment and Consent Agreement to Loan and Security Agreement dated as of
August 7, 2003, that certain Second Amendment to Loan and Security Agreement
dated as of November 26, 2003 and that certain Third Amendment and Joinder to
Loan and Security Agreement dated as of February 25, 2004 (as it may heretofore
otherwise have been or may herein or hereafter be modified, amended, restated or
replaced from time to time, the "Loan Agreement") pursuant to which Borrowers
established certain financing arrangements with Lenders including a Revolving
Credit Loan facility and a Letter of Credit facility. The Loan Agreement and all
instruments, documents and agreements executed in connection therewith or
related thereto are referred to herein collectively as the "Existing Loan
Documents." All capitalized terms not otherwise defined herein shall have the
meaning ascribed thereto in the Loan Agreement.
B. Borrowers, Agent and Lenders have agreed to amend certain
provisions of the Loan Agreement to regarding permissible capital stock
repurchases, such amendment to be made on the terms and conditions set forth
herein.
NOW, THEREFORE, with the foregoing Background incorporated by reference
and made a part hereof and intending to be legally bound, the parties agree as
follows:
1. Amendment to Loan Agreement. Upon the effectiveness of this
Amendment, the definition of "Permitted Stock Repurchase contained in Appendix A
to the Loan Agreement shall be amended by deleting such definition in its
entirety and replacing it as follows:
"Permitted Stock Repurchase - any share repurchase of the capital
stock of the Company, provided that (i) the aggregate amount of all
such stock repurchases calculated from and after August 7, 2003 (and
exclusive of the amount of any stock repurchases by the Company prior
to such date) shall not exceed Fifty-Five Million Dollars
($55,000,000.00), (ii) both prior and after giving effect to any such
stock repurchase, no Default or Event of Default shall exist and
(iii) both prior to and immediately after giving effect to any such
stock repurchase, and at all times during each of the next two fiscal
quarters ending immediately after the date of any such stock
repurchase, Borrowers shall have an Aggregate Excess Liquidity of at
least Sixty Million Dollars ($60,000,000.00), and the financial
information reported in the Form 10-K/10-Q reports filed by the
Company with the Securities and Exchange Commission for each such two
fiscal quarters shall reflect compliance as of the end of each such
fiscal quarter with the forgoing Aggregate Excess Liquidity covenant.
The quarterly Compliance Certificate provided by Borrowers at the end
of each such fiscal quarter shall include a certification with
supporting calculations as to whether or not Borrowers are in
compliance with the Aggregate Excess Liquidity covenant set forth in
the preceding sentence."
2. Representations and Warranties. To induce Agent and Lenders to
enter into this Amendment, each Borrower represents and warrants to Lender that:
(a) All warranties and representations made to Agent and
Lenders under the Loan Agreement and the other Existing Loan Documents are true
and correct as to the date hereof.
(b) The execution and delivery by each Borrower of this
Amendment and the performance by each such Borrower of the transactions herein
contemplated (i) are and will be within its powers, (ii) have been authorized by
all necessary corporate actions and will not contravene any provision of the
certificate or articles of incorporation or bylaws or other similar corporate
governance documents of such Borrower, and (iii) are not and will not be in
contravention of any order of any court or other agency of government, of law or
any other indenture, agreement or undertaking to which such Borrower is a party
or by which the property of such Borrower is bound, or be in conflict with,
result in a breach of, or constitute (with due notice and/or lapse of time, if
applicable) a default under any such indenture, agreement or undertaking or
result in the imposition of any lien, charge or encumbrance of any nature on any
of the properties of such Borrower.
(c) This Amendment and any assignment, instrument,
document or agreement executed and delivered in connection herewith, will be
valid and binding on and enforceable against each Borrower in accordance with
its respective terms.
(d) Both prior and after giving effect to this Amendment,
no Default or Event of Default exists under the Loan Agreement or any of the
other Existing Loan Documents.
(e) No authorization or approval or other action by, and
no notice to or filing with, any governmental authority or other regulatory body
is required in connection with the due execution, delivery and performance by
any Borrower of this Amendment or the performance by such Borrower of the Loan
Agreement, as amended hereby.
(f) The name, office, and signature of the officer(s) of
each Borrower signing this Amendment have previously been certified to Agent in
the incumbency and signature certificates of such Borrower heretofore delivered
to Agent.
3. Collateral. To secure the prompt payment and performance to
Agent and Lenders of the Obligations and satisfaction by Borrowers of all
covenants and undertakings contained in the Loan Agreement and other Existing
Loan Documents, each Borrower hereby reconfirms the grant to Agent, for the
ratable benefit of Lenders, of a continuing security interest in and Lien upon
all of the Collateral owned by such Borrower, whether now owned or existing or
hereafter created, acquired or arising and wherever located, given to Agent by
such Borrower under the Existing Loan Documents and each Borrower hereby
confirms and agrees that all security interests and liens granted to Agent by
any one of them continue in full force and effect and shall continue to secure
the Obligations. All Collateral remains free and clear of any liens other than
liens in favor of Agent, except for Permitted Liens. Nothing herein contained is
intended to in any way impair or limit the validity, priority, and extent of
Agent's existing security interest in and liens upon the Collateral of any
Borrower.
4. Effectiveness Conditions. This Amendment shall be effective
the execution and delivery of this Amendment by all parties hereto and payment
by Borrowers of all fees and expenses of Agent (including legal expenses)
incurred in relation to the preparation and execution of this Amendment.
5. Ratification of Existing Loan Documents. Except as expressly
set forth herein, all of the terms and conditions of the Loan Agreement and
Existing Loan Documents are hereby ratified and confirmed and continue unchanged
and in full force and effect. All references to the Loan Agreement shall mean
the Loan Agreement as modified by this Amendment.
6. Amendment as Loan Document. Borrowers hereby acknowledge and
agree that this Amendment constitutes a "Loan Document" under the Loan
Agreement. Accordingly, it shall be an Event of Default under the Loan Agreement
if (i) any representation or warranty made by Borrowers under or in connection
with this Amendment shall have been untrue, false or misleading in any material
respect when made, or (ii) Borrowers shall fail to perform or observe any term,
covenant or agreement contained in this Amendment.
7. Reaffirmation by Guarantors. Each Subsidiary Guarantor
acknowledges and agrees that the execution, delivery and performance of this
Amendment by Agent, Lenders and Borrowers, and the carrying out of the
provisions hereof and the consummation of all transactions contemplated
hereunder, including without limitation the amendments to the Loan Agreement
provided for hereunder, shall not affect or in any way diminish or modify the
obligations of each of them under the Subsidiary Guaranty and Surety Agreement
executed by Subsidiary Guarantors as of June 13, 2002 or any other Existing Loan
Document to which such Subsidiary Guarantor is a party, and each Subsidiary
Guarantor acknowledges and affirms its obligations under the Subsidiary Guaranty
and Surety Agreement and the other Existing Loan Documents.
8. Governing Law. THIS AMENDMENT HAS BEEN NEGOTIATED, EXECUTED
AND DELIVERED AT AND SHALL BE DEEMED TO HAVE BEEN MADE IN NEW YORK. THIS
AMENDMENT, AND ALL MATTERS ARISING OUT OF OR RELATING TO THE LOAN AGREEMENT, ANY
OTHER EXISTING LOAN
DOCUMENT, AND/OR THIS AMENDMENT, SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO ITS
OTHERWISE APPLICABLE CONFLICTS OF LAWS RULES.
9. Waiver of Jury Trial. EACH BORROWER AND EACH SUBSIDIARY
GUARANTOR WAIVES THE RIGHT TO TRIAL BY JURY (WHICH EACH LENDER AND AGENT HEREBY
ALSO WAIVES) IN ANY ACTION, SUIT, PROCEEDING OR COUNTERCLAIM OF ANY KIND ARISING
OUT OF OR RELATED TO ANY OF THIS AMENDMENT. EACH BORROWER AND EACH SUBSIDIARY
GUARANTOR WARRANTS AND REPRESENTS THAT IT HAS REVIEWED THE FOREGOING WAIVER WITH
ITS LEGAL COUNSEL AND HAS KNOWINGLY AND VOLUNTARILY WAIVED ITS JURY TRIAL RIGHTS
FOLLOWING CONSULTATION WITH LEGAL COUNSEL. IN THE EVENT OF LITIGATION, THIS
AGREEMENT MAY BE FILED AS A WRITTEN CONSENT TO A TRIAL BY THE COURT.
10. Successors and Assigns. This Amendment, along with each of the
Existing Loan Documents, shall be binding upon and shall benefit Agent, Lenders,
Borrowers and Subsidiary Guarantors and their respective successors and
permitted assigns (as and if permitted under the Loan Agreement).
11. Counterparts. This Amendment may be executed in any number of
counterparts, each of which when so executed shall be deemed to be an original,
and such counterparts together shall constitute one and the same respective
agreement. Signature by facsimile shall bind the parties hereto.
[REMAINDER OF PAGE LEFT INTENTIONALLY BLANK]
[SIGNATURES ON FOLLOWING PAGE]
IN WITNESS WHEREOF, the parties have executed this Fourth Amendment to
Loan and Security Agreement the day and year first written above.
BORROWERS:
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GENTIVA HEALTH SERVICES, INC.
By:
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Name: Xxxx X. Xxxxxxxxx
Title: Senior Vice President and Chief
Financial Officer
GENTIVA HEALTH SERVICES HOLDING CORP.
GENTIVA CARECENTRIX, INC.
GENTIVA CARECENTRIX (AREA ONE) CORP.
GENTIVA CARECENTRIX (AREA TWO) CORP.
GENTIVA CARECENTRIX (AREA THREE) CORP.
GENTIVA CERTIFIED HEALTHCARE CORP.
GENTIVA HEALTH SERVICES (CERTIFIED), INC.
GENTIVA HEALTH SERVICES IPA, INC.
GENTIVA HEALTH SERVICES (USA), INC.
GENTIVA SERVICES OF NEW YORK, INC.
NEW YORK HEALTHCARE SERVICES, INC.
OHS SERVICE CORP.
QC-MEDI NEW YORK, INC.
QUALITY CARE - USA, INC.
QUALITY MANAGED CARE, INC.
By:
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Name: Xxxx X. Xxxxxxxxx
Title: Treasurer
SUBSIDIARY GUARANTORS:
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COMMONWEALTH HOME CARE, INC.
XXXXXXXX HOME HEALTH CARE, INC.
PARTNERSFIRST MANAGEMENT, INC.
QUANTUM CARE NETWORK, INC.
QUANTUM HEALTH RESOURCES, INC.
THE I.V. CLINIC, INC.
THE I.V. CLINIC II, INC.
THE I.V. CLINIC III, INC.
By:
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Name: Xxxx X. Xxxxxxxxx
Title: Treasurer
[SIGNATURES CONTINUED ON FOLLOWING PAGE]
[Subsidiary Guarantors Signature Page to Fourth Amendment to June 2002
Loan Agreement]
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AGENT:
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FLEET CAPITAL CORPORATION,
as Agent
By:
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Name: Xxxx Xxxxxx
Title: Vice President
LENDERS:
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FLEET CAPITAL CORPORATION
By:
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Name: Xxxx Xxxxxx
Title: Vice President
SIEMENS FINANCIAL SERVICES, INC.
By:
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Name:
Title:
HFG HEALTHCO-5 LLC
By:
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Name:
Title:
[Agent and Lenders Signature Page to Fourth Amendment to June 2002
Loan Agreement]
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