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8-K
HANGER, INC. filed this Form 8-K on 06/23/2017
Entire Document
 

 

Item 1.01.                                        Entry into a Material Definitive Agreement.

 

In May 2017, Hanger, Inc. (the “Company”)  filed with the Securities and Exchange Commission its Annual Report on Form 10-K for the year ended December 31, 2014, which included restated financial information for 2010, 2011, 2012 and 2013.  The Company is currently working to complete its Annual Report on Form 10-K for the year ended December 31, 2016, which will include its audited 2015 and 2016 financial statements. The Company has not currently identified a timeline for the filing of its audited 2015 and 2016 financial statements.

 

Due to the ongoing preparation and audit of its 2015 and 2016 financial statements and as described in more detail in Item 1.01 of this Current Report on Form 8-K, the Company has entered into amendments to its Term B Credit Agreement and its Credit Agreement that, among other things, in each case extends from August 15, 2017 to February 15, 2018 the deadline by which the Company must deliver to the agent under the applicable credit agreement its audited 2015 and 2016 financial statements. Also as described in Item 1.01 below, the Company has entered into an amendment to the Rights Agreement, dated February 28, 2016, to extend the “Final Expiration Date” under the Rights Agreement to December 31, 2018.

 

Credit Agreement Amendments

 

Amendment to Term B Credit Agreement

 

On June 2, 2017, the Company entered into an Amendment (the “Term B Amendment”) among the Company, the guarantors party thereto, the lenders party thereto and Wilmington Trust, National Association, as administrative agent (the “Term B Agent”), that provided for amendments to its Credit Agreement dated as of August 1, 2016 (the “Term B Credit Agreement”) among the Company, the lenders from time to time party thereto and the Term B Agent, upon the satisfaction of certain conditions.  The amendments to the Term B Credit Agreement set forth in the Term B Amendment became effective on June 23, 2017.  The Amendment extends the deadline by which the Company must deliver to the Term B Agent its audited financial statements, the related audit report and a consolidated budget, in each case, for the fiscal year ending December 31, 2016, from August 15, 2017 to February 15, 2018.  The Amendment also extends the deadline by which the Compliance Date (as defined in the Term B Credit Agreement) must occur from August 15, 2017 to February 15, 2018. The Company is otherwise required to comply with all other obligations and covenants contained in the Term B Credit Agreement, including the timely delivery to the lenders of future financial statements and related information.

 

In connection with the entry into the Term B Amendment, the Company will pay the agent for the account of each consenting lender an amendment fee in an amount equal to 50 basis points of the outstanding principal amount of the loan held by such consenting lender.

 

The Term B Credit Agreement provides for a $280 million senior unsecured term loan facility under which all outstanding principal is due at maturity on August 1, 2019.  Borrowings under the Term B Credit Agreement bear interest at a fixed rate per annum equal to 11.50% payable quarterly in arrears.  As of May 31, 2017, the Company had $275.8 million in outstanding borrowings, net of unamortized discount of $4.2 million, under the Term B Credit Agreement.

 

Sixth Amendment to Credit Agreement

 

On June 22, 2017, the Company entered into a Sixth Amendment (the “Sixth Amendment”) among the Company,  the guarantors party thereto, the lenders party thereto and Bank of America, N.A., as agent (the “Agent”), that modified that certain Credit Agreement dated as of June 17, 2013 among the Company, the lenders from time to time party thereto and the Agent, as amended by the First Amendment and Waiver dated as of June 19, 2015, the Second Amendment and Waiver dated as of September 11,

 

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