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EXHIBIT 10.1
EXECUTION
AMERICAN HOMEPATIENT, INC.
FIRST AMENDMENT TO FOURTH
AMENDED AND RESTATED CREDIT AGREEMENT
This FIRST AMENDMENT TO FOURTH AMENDED AND RESTATED CREDIT
AGREEMENT (this "AMENDMENT") is dated as of October 29, 1998 and entered into by
and among American HomePatient, Inc., a Delaware corporation (the "BORROWER"),
the financial institutions listed on the signature pages hereof (each a "BANK"
and collectively, the "BANKS"), and Bankers Trust Company, as agent for the
Banks (in such capacity, the "AGENT"), and is made with reference to that
certain Fourth Amended and Restated Credit Agreement dated as of December 19,
1997 (the "CREDIT AGREEMENT"). Capitalized terms used herein without definition
shall have the same meanings herein as set forth in the Credit Agreement.
RECITALS
WHEREAS, the Borrower and the Banks desire to amend certain of
the terms and provisions of the Credit Agreement as set forth below;
NOW, THEREFORE, in consideration of the premises and the
agreements, provisions and covenants herein contained, the parties hereto agree
as follows:
SECTION 1. AMENDMENTS TO THE CREDIT AGREEMENT
1.1 AMENDMENTS TO SECTION 1: DEFINITIONS AND PRINCIPLES OF
CONSTRUCTION.
A. Section 1.01 of the Credit Agreement is hereby amended by adding
thereto the following definitions, which shall be inserted in proper
alphabetical order:
"CONSOLIDATED CAPITAL EXPENDITURES" means, for any period, the
aggregate of all expenditures by the Borrower and its Subsidiaries
during that period for fixed or capital assets (including, without
limitation, expenditures for product development and maintenance and
repairs that should be capitalized in accordance with generally
accepted accounting principles consistently applied and including
capitalized lease obligations).
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"CONSOLIDATED EXCESS CASH FLOW" means, for any period, an
amount (if positive) equal to (i) the sum, without duplication, of the
amounts for such period of (a) Consolidated EBITDA, (b) any repayments
of principal received by the Borrower or any of its Subsidiaries in
respect of any loans and advances made by the Borrower or any of its
Subsidiaries under Section 8.05(iii), and (c) the decrease, if any, in
Consolidated Working Capital from the first day to the last day of such
period (excluding, however, any such decrease to the extent
attributable to asset write-downs and/or write-offs referred to in
clause (iv) of the definition of Consolidated EBIT) minus (ii) the sum,
without duplication, of the amounts for such period of (a) voluntary
and scheduled repayments of Total Debt (excluding repayments of
Revolving Loans except to the extent the Revolving Loan Commitments are
permanently reduced in connection with such repayments), (b)
Consolidated Capital Expenditures, including any Consolidated Capital
Expenditures made by the Borrower and its Subsidiaries during such
period to acquire assets in Acquisitions permitted under Section
8.02(v) (in each case net of any proceeds of any related financings
with respect thereto), (c) equity investments made by the Borrower and
its Subsidiaries during such period under Section 8.05(vii), (d) loans
and advances made by the Borrower and its Subsidiaries to Joint
Ventures during such period under Section 8.05(iii), (e) Consolidated
Interest Expense (excluding, however, any interest expense not payable
in Cash (including amortization of discount and amortization of debt
issuance costs)), (f) the provision for current taxes based on income
of the Borrower and its Subsidiaries and payable in cash with respect
to such period, and (g) the increase, if any, in Consolidated Working
Capital from the first day to the last day of such period.
"CONSOLIDATED WORKING CAPITAL" means, as at any date of
determination, the excess (or deficit) of (i) the total assets of the
Borrower and its Subsidiaries on a consolidated basis which may
properly be classified as current assets in accordance with generally
accepted accounting principles consistently applied (excluding Cash and
Cash Equivalents) over (ii) the total liabilities of the Borrower and
its Subsidiaries on a consolidated basis which may properly be
classified as current liabilities in accordance with generally accepted
accounting principles consistently applied (excluding the current
portions of long-term Indebtedness and capital leases).
"FIRST AMENDMENT" means that certain to Fourth Amended and
Restated Credit Agreement dated as of October 29, 1998 by and among the
Borrower, the Banks and the Agent.
"FIRST AMENDMENT EFFECTIVE DATE" has the meaning assigned to
that term in the First Amendment.
B. Section 1.01 of the Credit Agreement is hereby further amended by
restating the definition of "Applicable Base Margin" in its entirety as follows:
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"APPLICABLE BASE MARGIN" means (i) as of any date of
determination prior to July 1, 1999, a percentage per annum equal to
2.50%, and (ii) as of any date of determination on or after July 1,
1999, a percentage per annum as shown in the table set forth below, in
each case determined with reference to the Leverage Ratio then in
effect; provided that, for purposes of this clause (ii) if the Borrower
has failed to provide a Margin Rate Determination Certificate within
the most recent period set forth in Section 7.01(j), the Leverage Ratio
for purposes of determining the Applicable Base Margin shall be deemed
to be 5.00:1.00 until such time as the Borrower next delivers a Margin
Rate Determination Certificate establishing a Leverage Ratio of less
than 5.00:1.00.
Applicable Base Margin Commencing July 1, 1999:
-----------------------------------------
LEVERAGE RATIO APPLICABLE
(X) BASE MARGIN
-----------------------------------------
x < 3.00 1.00%
-----------------------------------------
3.00 <= x < 3.50 1.25%
-----------------------------------------
3.50 <= x < 4.00 1.50%
-----------------------------------------
4.00 <= x < 5.00 1.75%
-----------------------------------------
5.00 <= x 2.50%
-----------------------------------------
C. Section 1.01 of the Credit Agreement is hereby further amended by
restating the definition of "Applicable Eurodollar Margin" in its entirety as
follows:
"APPLICABLE EURODOLLAR MARGIN" means (i) as of any date of
determination prior to July 1, 1999, a percentage per annum equal to
3.25%, and (ii) as of any date of determination on or after July 1,
1999, a percentage per annum as shown in the table set forth below, in
each case determined with reference to the Leverage Ratio then in
effect; provided that, for purposes of this clause (ii) if the Borrower
has failed to provide a Margin Rate Determination Certificate within
the most recent period set forth in Section 7.01(j), the Leverage Ratio
for purposes of determining the Applicable Eurodollar Margin shall be
deemed to be 5.00:1.00 until such time as the Borrower next delivers a
Margin Rate Determination Certificate establishing a Leverage Ratio of
less than 5.00:1.00.
Applicable Eurodollar Margin Commencing July 1, 1999:
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-----------------------------------------
LEVERAGE RATIO APPLICABLE
(X) EURODOLLAR
MARGIN
-----------------------------------------
x < 3.00 1.75%
-----------------------------------------
3.00 <= x < 3.50 2.00%
-----------------------------------------
3.50 <= x < 4.00 2.25%
-----------------------------------------
4.00 <= x < 5.00 2.50%
-----------------------------------------
5.00 <= x 3.25%
-----------------------------------------
D. Section 1.01 of the Credit Agreement is hereby further amended by
restating the definition of "Commitment Fee Percentage" in its entirety as
follows:
"COMMITMENT FEE PERCENTAGE" means, as of any date of determination, a
percentage per annum equal to 0.50%.
E. Section 1.01 of the Credit Agreement is hereby further amended by
deleting the word "and" immediately before clause (iii) of the definition of
"Consolidated EBIT" and by adding a new clause (iv) at the end of such
definition as follows:
", and (iv) certain one-time restructuring or similar charges
and related asset write-downs and/or write-offs, in each case taken or
recorded during the fiscal quarter of the Borrower ending September 30,
1998, in an aggregate amount not to exceed $15,250,000 (after giving
effect to the reversal into income of $4,000,000 of excess
restructuring charges referred to in the immediately preceding clause
(iii))."
F. Section 1.01 of the Credit Agreement is hereby further amended by
restating the definition of "Margin Rate Determination Certificate" in its
entirety as follows:
"MARGIN RATE DETERMINATION CERTIFICATE" means an Officers'
Certificate of the Borrower setting forth in reasonable detail the
Total Debt and the Consolidated Adjusted EBITDA as of the date on which
such Officers' Certificate is delivered pursuant to Section 7.01(j)
with the financial statements required pursuant to Section 7.01(a) or
7.01(b).
G. Section 1.01 of the Credit Agreement is hereby further amended by
deleting the definition of "Qualified High-Yield Debt" in its entirety.
H. Section 1.01 of the Credit Agreement is hereby further amended by
deleting the definition of "Qualified High-Yield Offering" in its entirety.
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1.2 AMENDMENTS TO SECTION 2: AMOUNT AND TERMS OF CREDIT.
A. THE REVOLVING LOANS. Section 2.01(a) of the Credit Agreement is
hereby amended by (i) deleting the reference therein to "$325,000,000" and
replacing it with "$285,000,000" and (ii) deleting subparagraph (ii) of the
second paragraph thereof in its entirety and substituting the following
therefor:
"(ii) In no event shall the Total Utilization of Revolving Loan
Commitments exceed (A) at any time prior to April 1, 1999, the lesser
of (1) $265,000,000 or (2) the Total Revolving Loan Commitments then in
effect, and (B) at any time from and after April 1, 1999, the Total
Revolving Loan Commitments then in effect."
B. THE SWING LINE LOANS. Section 2.02(a) of the Credit Agreement is
hereby amended by deleting subparagraph (i) of the second paragraph thereof in
its entirety and substituting the following therefor:
"(i) in no event shall the Total Utilization of Revolving Loan
Commitments exceed (A) at any time prior to April 1, 1999, the lesser
of (1) $265,000,000 or (2) the Total Revolving Loan Commitments then in
effect, and (B) at any time from and after April 1, 1999, the Total
Revolving Loan Commitments then in effect; and".
C. INTEREST ON THE LOANS. The last paragraph of Section 2.06(a)(ii) of
the Credit Agreement is hereby amended by deleting said paragraph in its
entirety and substituting the following therefor:
"From and after July 1, 1999, upon delivery of any Margin Rate
Determination Certificate by the Borrower to the Agent pursuant to
Section 7.01(j), the Applicable Base Margin and the Applicable
Eurodollar Margin shall automatically be adjusted in accordance with
the Leverage Ratio set forth therein, such adjustment to become
effective on the Business Day next succeeding the Business Day on which
the Agent received such Margin Rate Determination Certificate.
Anything contained in this Agreement or any of the other Credit
Documents to the contrary notwithstanding, to the extent that the
Applicable Base Margin and/or the Applicable Eurodollar Margin used in
calculating the amount of interest paid or accrued in respect of any
outstanding Loans during the period (the "RETROACTIVE PRICING PERIOD")
from and including September 30, 1998 to and including the First
Amendment Effective Date would have been greater if the
Effective Date had been September 30, 1998, (A) such increase in the
Applicable Base Margin and/or the Applicable Eurodollar Margin shall be
applied retroactively so as to give effect to such increase commencing
on September 30, 1998 with respect to all Loans outstanding at
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any time during the Retroactive Pricing Period, and (B) to the extent
that the Borrower has made any interest payments during the Retroactive
Pricing Period in respect of any outstanding Loans, the Borrower shall
pay to the Agent on the Effective Date, for
distribution in accordance with the first paragraph of Section 4.04(c)
to the Banks to which such interest payments were so made, an aggregate
amount equal to the additional interest payable in respect of such
Loans as a result of the application of the immediately preceding
clause (A)."
D. LETTERS OF CREDIT. Section 2.10(a) of the Credit Agreement is hereby
amended by deleting subparagraph (i) of the first paragraph thereof in its
entirety and substituting the following therefor:
"(i) any Letter of Credit if, after giving effect to such issuance, the
Total Utilization of Revolving Loan Commitments would exceed (A) at any
time prior to April 1, 1999, the lesser of (1) $265,000,000 or (2) the
Total Revolving Loan Commitments then in effect, and (B) at any time
from and after April 1, 1999, the Total Revolving Loan Commitments then
in effect; or"
1.3 AMENDMENTS TO SECTION 4: PREPAYMENTS AND REDUCTIONS IN COMMITMENTS;
PAYMENTS.
A. MANDATORY PREPAYMENTS AND MANDATORY REDUCTIONS OF REVOLVING LOAN
COMMITMENTS.
(i) Section 4.02(c)(i) of the Credit Agreement is hereby amended by
deleting it in its entirety and substituting therefor the following:
" (I) Prepayments and Reductions Due to Consolidated Excess
Cash Flow. In the event that there shall be Consolidated Excess
Cash Flow in excess of $500,000 for any Fiscal Year (commencing
with Fiscal Year 1998), the Borrower shall, no later than 90
days after the end of such Fiscal Year, prepay the Loans and/or
the Revolving Loan Commitments shall be permanently reduced in
an aggregate amount equal to 75% of the entire amount of such
Consolidated Excess Cash Flow. Concurrently with any prepayment
of the Loans and/or reduction of the Revolving Loan Commitments
pursuant to this Section 4.02(c)(i), the Borrower shall deliver
to Agent an Officers' Certificate demonstrating the calculation
of the Consolidated Excess Cash Flow that gave rise to such
prepayment and/or reduction. In the event that the Borrower
shall subsequently determine that the actual Consolidated
Excess Cash Flow was greater than the amount set forth in such
Officers' Certificate, the Borrower shall promptly make an
additional prepayment of the Loans (and/or, if applicable, the
Revolving Loan Commitments shall be permanently reduced) in
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an amount equal to the amount of such excess, and the Borrower
shall concurrently therewith deliver to Agent an Officers'
Certificate demonstrating the derivation of the additional
Consolidated Excess Cash Flow resulting in such excess."
(ii) Section 4.02(c)(ii) of the Credit Agreement is hereby amended by
deleting the phrases "Other Than in Connection With a Qualified High-Yield
Offering" and "(other than pursuant to a Qualified High-Yield Offering)"
contained therein.
(iii) Section 4.03(b) of the Credit Agreement is hereby amended by
deleting the phrase "pursuant to Section 4.02(c)(ii)" contained in such Section
and substituting therefor the phrase "pursuant to Section 4.02(c)(i) or Section
4.02(c)(ii)".
(iv) Section 4.03(c) of the Credit Agreement is hereby amended by
restating said Section in its entirety as follows:
"(C) APPLICATION OF CERTAIN MANDATORY PREPAYMENTS OF TERM
LOANS. Any mandatory prepayments of the Term Loans pursuant to Section
4.02(c)(i) shall be applied to reduce the scheduled installments of
principal of the Term Loans set forth in Section 4.01 in forward order
of maturity. Any mandatory prepayments of the Term Loans pursuant to
Section 4.02(c)(ii) shall be applied to reduce the scheduled
installments of principal of the Term Loans in Section 4.01 on a pro
rata basis in accordance with the respective outstanding principal
amounts thereof."
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1.4 AMENDMENTS TO SECTION 7: AFFIRMATIVE COVENANTS.
A. INFORMATION COVENANTS.
(i) Section 7.01 of the Credit Agreement is hereby amended by deleting
the reference to "February 15, 1998" contained in paragraph (d) thereof and
substituting a reference to "February 15, 2000" therefor.
(ii) Section 7.01 of the Credit Agreement is hereby further amended by
restating paragraph (j) thereof in its entirety as follows:
"(J) MARGIN RATE DETERMINATION CERTIFICATE. From and after
July 1, 1999, concurrently with the delivery of the financial
statements required under Sections 7.01(a) and (b), the Borrower shall
deliver a Margin Rate Determination Certificate."
(iii) Section 7.01 of the Credit Agreement is hereby further amended by
(a) relettering existing paragraph "(l)" as paragraph "(m)" and (b) adding the
following new paragraph (l) thereto:
"(L) MONTHLY FINANCIAL STATEMENTS AND ACCOUNTS RECEIVABLE INFORMATION.
Within 45 days after the end of each calendar month, (i) the
consolidated balance sheets of the Borrower and its Subsidiaries as at
the end of such month and the related consolidated statements of
operations and statements of cash flows for such month and for the
elapsed portion of the Fiscal Year ended with the last day of such
month, all of which shall be certified by the Chief Executive Officer
or the Chief Financial Officer of the Borrower, subject to normal
year-end audit adjustments, (ii) a performance report, in a form
reasonably satisfactory to the Banks, comparing the actual results of
operations, financial position and cash flows for such month and for
the elapsed portion of the Fiscal Year ended with the last day of such
month to those forecasted in the Performance Plan and stating the
reasons for any variance between such actual and forecasted results of
operations, financial position and cash flows and explanations for any
such variances that are adverse to the Borrower or any of its
Subsidiaries, (iii) a narrative report, in the form prepared for
presentation to senior management, describing the operations of the
Borrower and its Subsidiaries (including placements of oxygen
concentrators) for such month and for the period from the beginning of
the then current Fiscal Year to the end of such month, and (iv) an
Accounts Receivable report consisting of (a) detailed Accounts
Receivable agings and (b) bad debt expense analysis."
B. FURTHER ASSURANCES; NEW SUBSIDIARIES.
(i) Section 7.11 of the Credit Agreement is hereby amended by adding
the following sentence at the end of paragraph (a) thereof:
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"Without limiting the generality of the foregoing, from and after the
Effective Date, the Borrower shall promptly take all
such actions, and shall promptly provide the Agent with all such
information, as the Agent may reasonably request in order to (i) enable
the Agent to perform an audit of the Collateral for the purpose of
confirming that the Agent has a valid and perfected security interest
in all personal and mixed property of the Borrower and its Subsidiaries
and (ii) create, perfect and/or continue the Agent's security interest
in any such property to the extent necessary to effect fully the
purposes of this Agreement and the other Credit Documents."
(ii) Section 7.11(b) of the Credit Agreement is hereby amended by
restating it in its entirety as follows:
"(B) In the event a Person becomes a Subsidiary of the Borrower
(other than as a Joint Venture) after the Effective Date, the Borrower
shall, within 10 Business Days of such event, cause such Subsidiary to
execute and deliver the Subsidiary Guaranty, the Subsidiary Pledge
Agreement, a Subsidiary Partnership Security Agreement, the Subsidiary
Security Agreement, Collection Bank Agreements and the Subsidiary
Trademark Security Agreement, in each case together with such other
agreements, pledges, assignments, documents and certificates
(including, without limitation, any amendments to the Credit Documents)
as may be necessary or desirable or as the Agent may request and do
such other acts and things as the Agent reasonably may request in order
to have such domestic Subsidiary guaranty and/or secure the Obligations
and effect fully the purposes of this Agreement and the other Credit
Documents and to provide for payment of the Obligations in accordance
with the terms of this Agreement and the other Credit Documents."
C. MANAGEMENT CONSULTANT. Section 7 of the Credit Agreement is hereby
amended by adding the following new Section 7.13 at the end thereof:
"7.13 MANAGEMENT CONSULTANT. Promptly upon the request of the
Required Banks, which may be delivered to the Borrower at any time
during the period from and including January 1, 1999 through and
including June 30, 1999, the Borrower shall engage a management
consultant selected by the Borrower and approved by the Required Banks;
provided that (i) the scope, duration and other terms of such
engagement (including terms relating to the free and timely sharing of
information by such management consultant with the Borrower and the
Banks) shall be mutually agreeable to the Borrower and the Required
Banks and (ii) the Borrower and such management consultant shall enter
into a confidentiality and exclusivity agreement on terms mutually
agreeable to the Borrower and the Required Banks."
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1.5 AMENDMENTS TO SECTION 8: NEGATIVE COVENANTS.
A. CONSOLIDATION, MERGER, SALE OF ASSETS, ETC. Section 8.02(v) of the
Credit Agreement is hereby amended by restating it in its entirety as follows:
"(v) the Borrower and its Wholly-Owned Subsidiaries may
(without regard to the limitations set forth in Section 8.07) acquire
property and assets of other Persons (including any assets or property
acquired in any Acquisition) provided that the aggregate consideration
paid by the Borrower or such Subsidiaries consisting of cash or any
assets of the Borrower or such Subsidiaries (excluding any common stock
of the Borrower and the proceeds of any Divestiture but including the
principal amount of any Indebtedness described in Section 8.04(xii)
incurred in connection with such Acquisition and the principal amount
of any loans made to the applicable seller in connection with such
Acquisition in accordance with Section 8.05(xi)) shall not, without the
prior written consent of the Required Banks, exceed (if valued at fair
market value at the time of such Acquisition, as reasonably determined
by the board of directors of the Person making such Acquisition)
$7,000,000 in the aggregate over any twelve-month period commencing
with the Effective Date (including in such calculation
any consideration paid by the Borrower to acquire any Joint Venture)
when added to the aggregate amount of all investments made pursuant to
Section 8.05(vii) in such twelve-month period; provided further that
the ratio of Total Debt to Consolidated Adjusted EBITDA shall be in
compliance with the requirement of Section 8.08, in each case
calculated on a pro forma basis to give effect to such Acquisition;
provided further, that if such acquisition of property and assets is an
acquisition of stock, then such acquisition shall, except with respect
to Joint Ventures, result in the ownership by the Borrower or a
Wholly-Owned Subsidiary of a majority interest in the capital stock of
the entity whose stock is being acquired;"
B. INDEBTEDNESS. Section 8.04 of the Credit Agreement is hereby amended
by deleting clause (xviii) thereof in its entirety.
C. ADVANCES, INVESTMENTS AND LOANS. Section 8.05 of the Credit
Agreement is hereby amended by deleting the reference to "$10,000,000" in clause
(iii) therein and substituting "$15,000,000" therefor.
D. CAPITAL EXPENDITURES. Section 8.07 of the Credit Agreement is hereby
amended by restating it in its entirety as follows:
"8.07 CAPITAL EXPENDITURES. Except for Consolidated
Capital Expenditures made by the Borrower and its Subsidiaries
during any Fiscal Year to acquire assets in Acquisitions
permitted under Section 8.02(v), the Borrower will not, and
will not permit any of its Subsidiaries to, make Consolidated
Capital Expenditures during any Fiscal Year set forth below in
an aggregate
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amount in excess of the correlative amount set forth below
opposite such Fiscal Year:
FISCAL YEAR AMOUNT
1998 $35,000,000
-----------------------------------------------
1999 $35,000,000
-----------------------------------------------
2000 $35,000,000
-----------------------------------------------
2001 $35,000,000
-----------------------------------------------
2002 $35,000,000 "
-----------------------------------------------
E. LEVERAGE RATIO. Section 8.08 of the Credit Agreement is hereby
amended by restating it in its entirety as follows:
"LEVERAGE RATIO. The Borrower shall not permit the ratio of (i) Total
Debt to (ii) Consolidated Adjusted EBITDA for any consecutive
four-fiscal quarter period ending as of the last day of any fiscal
quarter of the Borrower set forth below to be more than the correlative
amount set forth below:
FISCAL QUARTER LEVERAGE RATIO
----------------------------------------------------------
1998 FQ3 4.25:1.00
----------------------------------------------------------
1998 FQ4 4.75:1.00
----------------------------------------------------------
1999 FQ1 5.30:1.00
----------------------------------------------------------
1999 FQ2 5.85:1.00
----------------------------------------------------------
1999 FQ3 5.80:1.00
----------------------------------------------------------
1999 FQ4 5.70:1.00
----------------------------------------------------------
2000 FQ1 5.60:1.00
----------------------------------------------------------
2000 FQ2 5.45:1.00
----------------------------------------------------------
2000 FQ3 5.25:1.00
----------------------------------------------------------
2000 FQ4 4.80:1.00
----------------------------------------------------------
2001 FQ1 4.60:1.00
----------------------------------------------------------
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FISCAL QUARTER LEVERAGE RATIO
----------------------------------------------------------
2001 FQ2 4.50:1.00
----------------------------------------------------------
2001 FQ3 4.40:1.00
----------------------------------------------------------
2001 FQ4 4.20:1.00
----------------------------------------------------------
2002 FQ1 4.20:1.00
----------------------------------------------------------
2002 FQ2 4.10:1.00
----------------------------------------------------------
2002 FQ3 4.10:1.00
----------------------------------------------------------
2002 FQ4 4.00:1.00
----------------------------------------------------------
F. MINIMUM INTEREST COVERAGE RATIO. Section 8.10 of the Credit
Agreement is hereby amended by restating it in its entirety as follows:
"MINIMUM INTEREST COVERAGE RATIO. The Borrower shall not permit the
ratio of (i) Consolidated EBITDA of the Borrower and its Subsidiaries
to (ii) Consolidated Interest Expense for any consecutive four-fiscal
quarter period ending as of the last day of any fiscal quarter of the
Borrower set forth below to be less than the correlative amount set
forth below:
FISCAL QUARTER MINIMUM INTEREST
COVERAGE RATIO
----------------------------------------------------------
1998 FQ3 3.45:1.00
----------------------------------------------------------
1998 FQ4 2.75:1.00
----------------------------------------------------------
1999 FQ1 2.30:1.00
----------------------------------------------------------
1999 FQ2 1.90:1.00
----------------------------------------------------------
1999 FQ3 1.85:1.00
----------------------------------------------------------
1999 FQ4 1.85:1.00
----------------------------------------------------------
2000 FQ1 1.90:1.00
----------------------------------------------------------
2000 FQ2 2.10:1.00
----------------------------------------------------------
2000 FQ3 2.20:1.00
----------------------------------------------------------
2000 FQ4 2.40:1.00
----------------------------------------------------------
2001 FQ1 2.40:1.00
----------------------------------------------------------
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FISCAL QUARTER MINIMUM INTEREST
COVERAGE RATIO
----------------------------------------------------------
2001 FQ2 2.40:1.00
----------------------------------------------------------
2001 FQ3 2.60:1.00
----------------------------------------------------------
2001 FQ4 2.80:1.00
----------------------------------------------------------
2002 FQ1 2.80:1.00
----------------------------------------------------------
2002 FQ2 2.90:1.00
----------------------------------------------------------
2002 FQ3 3.00:1.00
----------------------------------------------------------
2002 FQ4 3.15:1.00
----------------------------------------------------------
G. LIMITATION ON VOLUNTARY PAYMENTS AND MODIFICATIONS OF INDEBTEDNESS;
MODIFICATIONS OF CERTIFICATE OF INCORPORATION, BY-LAWS AND CERTAIN
OTHER AGREEMENTS; ETC.
(i) Section 8.11 of the Credit Agreement is hereby amended by deleting
the phrase "(x) any Qualified High-Yield Debt or (y) any other" from clause (i)
contained therein and substituting therefor the word "any".
(ii) Section 8.11 of the Credit Agreement is hereby further amended by
(a) deleting clause (iii) contained therein in its entirety and (b) renumbering
existing clause (iv) thereof as clause (iii).
H. COLLECTION BANK AGREEMENTS. Section 8.16 of the Credit Agreement is
hereby amended by deleting the phrase "Prior to the consummation of a Qualified
High-Yield Offering, the" contained therein and substituting therefor the word
"The".
I. MINIMUM CONSOLIDATED EBITDA. Section 8 of the Credit Agreement is
hereby further amended by adding a new Section 8.17 at the end thereof as
follows:
"8.17 MINIMUM CONSOLIDATED EBITDA. The Borrower shall not permit
Consolidated EBITDA for any fiscal quarter of the Borrower set forth
below to be less than the correlative amount indicated:
FISCAL QUARTER MINIMUM CONSOLIDATED
EBITDA
----------------------------------------------------------
1998 FQ3 $13,400,000
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FISCAL QUARTER MINIMUM CONSOLIDATED
EBITDA
----------------------------------------------------------
1998 FQ4 $14,000,000
----------------------------------------------------------
1999 FQ1 $12,750,000
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1999 FQ2 $14,000,000
----------------------------------------------------------
1999 FQ3 $14,250,000
----------------------------------------------------------
1999 FQ4 $15,500,000
----------------------------------------------------------
2000 FQ1 $15,500,000
----------------------------------------------------------
2000 FQ2 $16,000,000
----------------------------------------------------------
2000 FQ3 $17,000,000
----------------------------------------------------------
2000 FQ4 $18,000,000
----------------------------------------------------------
2001 FQ1 $18,000,000
----------------------------------------------------------
2001 FQ2 $18,500,000
----------------------------------------------------------
2001 FQ3 $18,500,000
----------------------------------------------------------
2001 FQ4 $19,500,000
----------------------------------------------------------
2002 FQ1 $19,500,000
----------------------------------------------------------
2002 FQ2 $19,500,000
----------------------------------------------------------
2002 FQ3 $20,000,000
----------------------------------------------------------
2002 FQ4 $21,000,000
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1.6 AMENDMENTS TO SECTION 10: THE AGENT.
A. RELEASE OF COLLATERAL. Section 10.10 of the Credit Agreement is
hereby amended by deleting paragraph (b) contained therein in its entirety.
1.7 AMENDMENTS TO SECTION 11: MISCELLANEOUS.
A. CALCULATIONS; COMPUTATIONS. Section 11.08 of the Credit Agreement is
hereby amended by adding the following proviso at the end thereof:
"; provided, further that, without limiting the generality of the
foregoing proviso, in no event shall the Borrower change the Accounts
Receivable reserve policies applied by
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the Borrower for purposes of such computations without the consent of
the Required Banks."
1.8 SUBSTITUTION OF SCHEDULE 1.01(A): PRO RATA SHARES, REVOLVING
COMMITMENTS. Schedule 1.01(a) to the Credit Agreement is hereby amended by
deleting said Schedule 1.01(a) in its entirety and substituting in place thereof
a new Schedule 1.01(a) in the form of Annex I to this Amendment.
SECTION 2. CONDITIONS TO EFFECTIVENESS
Section 1 of this Amendment shall become effective only upon
the satisfaction of all of the following conditions precedent (the date of
satisfaction of such conditions being referred to herein as the "First Amendment
EFFECTIVE DATE"):
A. On or before the First Amendment Effective Date, the Borrower shall
deliver to the Banks (or to Agent for the Banks with sufficient originally
executed copies, where appropriate, for each Bank and its counsel) the
following, each, unless otherwise noted, dated the First Amendment Effective
Date:
1. A certificate, dated the First Amendment Effective Date,
signed by the President or Vice President of the Borrower and attested
to by the Secretary or any Assistant Secretary of the Borrower, in form
and substance satisfactory to the Agent, certifying that the
Certificate of Incorporation and the By-Laws of the Borrower were
delivered to the Agent pursuant to the Credit Agreement and that there
has been no change in such Certificate of Incorporation or such By-laws
since the date of such delivery;
2. A good standing certificate for the Borrower from the
Secretary of State of the State of Delaware, dated a recent date prior
to the First Amendment Effective Date;
3. Resolutions of the Board of Directors of the Borrower
approving and authorizing the execution, delivery, and performance of
this Amendment, signed by the President or Vice President of the
Borrower and attested to by the Secretary or any Assistant Secretary of
the Borrower; and
4. Signature and incumbency certificates of the officers of
the Borrower executing this Amendment.
B. The Banks and their respective counsel shall have received
originally executed copies of one or more favorable written opinions of Xxxxxxx
Xxxxxx Xxxx Xxxxxxx & Manner, P.C., counsel for the Borrower, in form and
substance reasonably satisfactory to
15
16
Agent and its counsel, dated as of the Effective Date, with respect to the
enforceability of the Amended Agreement (as hereinafter defined) and as to such
other matters as Agent acting on behalf of the Banks may reasonably request.
C. The Borrower shall have delivered to the Agent an Officers'
Certificate, dated as of the First Amendment Effective Date, to the effect that
the Borrower and each of its Subsidiaries have executed and delivered to the
Agent (or will so execute and deliver within 15 days after the First Amendment
Effective Date) substantially all of the applicable Credit Documents required to
be executed and delivered by the Borrower or such Subsidiary pursuant to Section
7.11 of the Credit Agreement or any comparable provision of the Prior Credit
Agreement.
D. On or before the First Amendment Effective Date, the Borrower shall
have delivered to the Agent a performance plan for Fiscal Year 1999 which shall
satisfy the requirements for a Performance Plan under Section 7.01(d) of the
Credit Agreement.
E. On or before the First Amendment Effective Date, the Borrower shall
have delivered to the Agent, for distribution to each Bank which has approved
this Amendment on or before October 30, 1998, a non-refundable amendment fee
equal to 1/4 of 1% of the sum of the outstanding Term Loan of such Bank plus the
Revolving Loan Commitment of such Bank as set forth on Annex I hereto.
SECTION 3. BORROWER'S REPRESENTATIONS AND WARRANTIES
In order to induce the Banks to enter into this Amendment and
to amend the Credit Agreement in the manner provided herein, the Borrower
represents and warrants to each Bank that the following statements are true,
correct and complete:
A. CORPORATE POWER AND AUTHORITY. The Borrower has all requisite
corporate power and authority to enter into this Amendment and to carry out the
transactions contemplated by, and perform its obligations under, the Credit
Agreement as amended by this Amendment (the "AMENDED AGREEMENT").
B. AUTHORIZATION OF AGREEMENTS. The execution and delivery of this
Amendment, the performance of the Amended Agreement and the consummation of the
transactions contemplated hereby have been duly authorized by all necessary
corporate action on the part of the Borrower.
C. NO CONFLICT. The execution and delivery by the Borrower of this
Amendment, the performance by the Borrower of the Amended Agreement and the
consummation of the transactions contemplated hereby do not and will not (i)
violate any provision of any law or
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17
any governmental rule or regulation applicable to the Borrower or any of its
Subsidiaries, the Certificate or Articles of Incorporation or Bylaws of the
Borrower or any of its Subsidiaries, or any order, judgment or decree of any
court or other agency of government binding on the Borrower or any of its
Subsidiaries, (ii) conflict with, result in a breach of or constitute (with due
notice or lapse of time or both) a default under any Contractual Obligation of
the Borrower or any of its Subsidiaries, (iii) result in or require the creation
or imposition of any Lien upon any of the properties or assets of the Borrower
or any of its Subsidiaries, or (iv) require any approval of stockholders or any
approval or consent of any Person under any Contractual Obligation of the
Borrower or any of its Subsidiaries except for such approvals or consents which
will be obtained on or before the First Amendment Effective Date (as hereinafter
defined).
D. GOVERNMENTAL CONSENTS. The execution and delivery by the Borrower of
this Amendment, the performance by the Borrower of the Amended Agreement and the
consummation of the transactions contemplated hereby do not and will not require
any registration with, consent or approval of, or notice to, or other action to,
with or by, any federal, state or other governmental authority or regulatory
body.
E. BINDING OBLIGATION. This Amendment and the Amended Agreement have
been duly executed and delivered by the Borrower and are the legally valid and
binding obligations of the Borrower, enforceable against the Borrower in
accordance with their respective terms, except as may be limited by bankruptcy,
insolvency, reorganization, moratorium or similar laws relating to or limiting
creditors' rights generally or by equitable principles relating to
enforceability.
F. INCORPORATION OF REPRESENTATIONS AND WARRANTIES FROM CREDIT
DOCUMENTS. All representations and warranties of the Borrower or any of its
Subsidiaries contained in the Credit Documents are and will be true, correct and
complete in all material respects on and as of the First Amendment Effective
Date to the same extent as though made on and as of that date, except to the
extent such representations and warranties specifically relate to an earlier
date, in which case they were true, correct and complete in all material
respects on and as of such earlier date.
G. ABSENCE OF DEFAULT. No event has occurred and is continuing or will
result from the consummation of the transactions contemplated by this Amendment
that would constitute an Event of Default or a Potential Event of Default.
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SECTION 4. MISCELLANEOUS
A. REFERENCE TO AND EFFECT ON THE CREDIT AGREEMENT AND THE OTHER CREDIT
DOCUMENTS.
(i) The Borrower hereby agrees and confirms that on and after
the First Amendment Effective Date each Credit Document and all
collateral encumbered thereby shall continue to secure to the fullest
extent possible the payment and performance of all "Secured
Obligations" (as defined in each applicable Credit Document), including
without limitation the payment and performance of all such "Secured
Obligations" in respect of the Obligations of the Borrower now or
hereafter existing under or in respect of the Amended Agreement and the
Notes.
(ii) On and after the First Amendment Effective Date, each
reference in the Credit Agreement to "this Agreement", "hereunder",
"hereof", "herein" or words of like import referring to the Credit
Agreement, and each reference in the other Credit Documents to the
"Credit Agreement", "thereunder", "thereof" or words of like import
referring to the Credit Agreement shall mean and be a reference to the
Amended Agreement.
(iii) The Borrower acknowledges and agrees that any of the
Credit Documents to which it is a party or otherwise bound shall
continue in full force and effect, and are hereby ratified and
confirmed, and that all of its respective obligations thereunder shall
be valid and enforceable and shall not be impaired, limited or
otherwise affected by the execution, delivery or effectiveness of this
Amendment or any future amendment or modification of the Amended
Agreement.
(iv) The execution, delivery and performance of this Amendment
shall not, except as expressly provided herein or therein, constitute a
waiver of any provision of, or operate as a waiver of any right, power
or remedy of the Agent or any Bank under, the Credit Agreement or any
of the other Credit Documents.
B. FEES AND EXPENSES. The Borrower acknowledges that all reasonable
costs, fees and expenses incurred by the Agent and its counsel with respect to
this Amendment and the documents and transactions contemplated hereby shall be
for the account of the Borrower.
C. HEADINGS. Section and subsection headings in this Amendment are
included herein for convenience of reference only and shall not constitute a
part of this Amendment for any other purpose or be given any substantive effect.
D. APPLICABLE LAW. THIS AMENDMENT SHALL BE GOVERNED BY, AND SHALL BE
CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.
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E. COUNTERPARTS; EFFECTIVENESS. This Amendment may be executed in any
number of counterparts and by different parties hereto in separate counterparts,
each of which when so executed and delivered shall be deemed an original, but
all such counterparts together shall constitute but one and the same instrument;
signature pages may be detached from multiple separate counterparts and attached
to a single counterpart so that all signature pages are physically attached to
the same document. This Amendment (other than the provisions of Section 1
hereof, the effectiveness of which is governed by Section 2 hereof) shall become
effective upon the execution of a counterpart hereof by the Borrower, the Agent
and the Required Banks and receipt by the Borrower and the Agent of written or
telephonic notification of such execution and authorization of delivery thereof.
[Remainder of page intentionally left blank]
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IN WITNESS WHEREOF, the parties hereto have caused this
Amendment to be duly executed and delivered by their respective officers
thereunto duly authorized as of the date first written above.
AMERICAN HOMEPATIENT, INC.,
a Delaware corporation
By: /s/
----------------------------------------
Name: Xxxx Xxxxx Xxxxxxx
Title: Sr. Vice Pres., CFO, CAO
S-1
21
BANKERS TRUST COMPANY,
Individually and as the Agent
By: /s/
----------------------------------------
Name: Xxxx Xx Xxxxx
Title: Assistant Vice President
S-2
22
ABN AMRO BANK, N.V.
By:
----------------------------------------
Name:
Title:
By:
----------------------------------------
Name:
Title:
X-0
00
XXXXXXX XXXX
By: /s/
----------------------------------------
Name: Xxxxx X. Wind
Title: V.P.
S-4
24
BANK OF AMERICA, N.T. & S.A.
By: /s/
----------------------------------------
Name: J. Xxxxxxx Xxxxxx
Title: Vice President
S-5
25
BANK OF MONTREAL
By:
----------------------------------------
Name:
Title:
S-6
26
FIRST UNION NATIONAL BANK
(formerly Corestates Bank, N.A.)
By: /s/
----------------------------------------
Name: Xxxxxxxxx X. Xxxxxx
Title: Vice President
S-7
27
FIRST AMERICAN NATIONAL BANK
By: /s/
----------------------------------------
Name: Xxxxxx X. Xxxxxxxxxxx
Title: Senior Vice-President
S-8
28
THE FIRST NATIONAL BANK OF CHICAGO
By:
----------------------------------------
Name:
Title:
S-9
29
THE FUJI BANK, LIMITED, NEW YORK BRANCH
By:
----------------------------------------
Name:
Title:
S-10
30
PNC BANK NATIONAL ASSOCIATION
By:
----------------------------------------
Name:
Title:
X-00
00
XXXXXXXXXXXX XXXXXXXX RAIFFESEN -
BOERENLEENBANK, B.A., "RABOBANK
NEDERLAND", NEW YORK BRANCH
By: /s/
----------------------------------------
Name: W. Xxxxxxx Xxxxxxx
Title: SVP
By: /s/
----------------------------------------
Name: Xxxxxxxx Xxxxxxxx
Title: VP
S-12
32
THE SAKURA BANK, LIMITED
By: /s/
----------------------------------------
Name: Xxxxxxxxx Xxxxxx
Title: Vice President
S-13
33
SUNTRUST BANK, NASHVILLE, N.A.
By:
----------------------------------------
Name:
Title:
S-14
00
XXXXX XXXX XX XXXXXXXXXX, N.A.
By: /s/
----------------------------------------
Name: Xxxx X. Xxxx
Title: Vice President
S-15
35
UBS AG, NEW YORK BRANCH
By: /s/
----------------------------------------
Name: Xxx X. Xxxxx
Title: Director
/s/
----------------------------------------
Name: Xxxxxxx Xxxxxxx
Title: Executive Director
S-16
36
NATIONSBANK, N.A.
By: /s/
----------------------------------------
Name: J. Xxxxxxx Xxxxxx
Title: Vice President
S-17
37
ANNEX
BANKS' COMMITMENTS AND PRO RATA SHARES
PRO RATA
(FOR PURPOSES OF
SHARE (RE: CLAUSE (III) OF THE
REVOLVING PRO RATA SHARE DEFINITION OF THE
REVOLVING LOAN LOAN TERM LOAN (RE: TERM LOAN TOTAL TERM "PRO RATA
COMMITMENT COMMITMENT) COMMITMENT COMMITMENT) COMMITMENT SHARE")
------------ -------------- ----------- -------------- ------------ --------------
BANKERS TRUST COMPANY $ 26,362,500 9.250000000% $ 6,937,500 9.250000000% $ 33,300,000 9.250000000%
ABN AMRO BANK, N.V. $ 19,237,500 6.750000000% $ 5,062,500 6.750000000% 24,300,000 6.750000000%
AMSOUTH BANK OF ALABAMA $ 24,937,500 8.750000000% $ 6,562,500 8.750000000% 31,500,000 8.750000000%
BANK OF AMERICA/NATIONSBANK, N.A. $ 49,875,000 17.500000000% $13,125,000 17.500000000% 63,000,000 17.000000000%
BANK OF MONTREAL $ 17,812,500 6.000000000% $ 4,687,500 6.250000000% 22,500,000 6.250000000%
THE FIRST NATIONAL BANK OF CHICAGO $ 10,687,500 3.750000000% $ 2,812,500 3.750000000% 13,500,000 3.750000000%
FIRST AMERICAN NATIONAL BANK $ 10,687,500 3.750000000% $ 2,812,500 3.750000000% 13,500,000 3.750000000%
FIRST UNION NATIONAL BANK $ 17,812,500 6.250000000% $ 4,687,500 6.250000000% 22,500,000 6.250000000%
THE FUJI BANK, LIMITED $ 10,687,500 3.750000000% $ 2,812,500 3.750000000% 13,500,000 3.750000000%
PNC BANK, KENTUCKY, INC. $ 23,512,500 8.250000000% $ 6,187,500 8.250000000% 29,700,000 8.250000000%
COOPERATIEVE CENTRALE RAIFFEISEN-
BOERENLEENBANK, B.A."RABOBANK
NEDERLAND", NEW YORK $ 23,512,500 8.250000000% $ 6,187,500 8.250000000% 29,700,000 8.250000000%
THE SAKURA BANK, LIMITED $ 3,562,500 1.250000000% $ 937,500 1.250000000% 4,500,000 1.250000000%
SUNTRUST BANK, NASHVILLE, N.A. $ 24,937,500 8.750000000% $ 6,562,500 8.750000000% 31,500,000 8.750000000%
UNION BANK OF SWITZERLAND $ 10,687,500 3.750000000% $ 2,812,500 3.750000000% 13,500,000 3.750000000%
UNION BANK OF CALIFORNIA, N.A. $ 10,687,500 3.750000000% $ 2,812,500 3.750000000% 13,500,000 3.750000000%
------------ -------------- ----------- -------------- ------------ --------------
$285,000,000 100.000000000% $75,000,000 100.000000000% $360,000,000 100.000000000%
============ ============== =========== ============== ============ ==============
