GVHR » Topics » Our credit agreement contains restrictive covenants that may restrict our financial and operating flexibility.

These excerpts taken from the GVHR 10-K filed Mar 17, 2008.

Our credit agreement contains restrictive covenants that may restrict our financial and operating flexibility.

        Our new credit agreement, which is fully secured by liens in substantially all the property and assets (with agreed upon carveouts and exceptions) of the Company, restricts us and our subsidiaries from various actions, including the following, in each case subject to various specified exceptions:

    incurring liens and debt;

    making acquisitions;

    repurchasing shares of the Company's stock;

    making capital expenditures;

    making investments;

    entering into a merger, sale of all or substantially all of our assets or undergoing a change of control;

    selling assets;

    paying dividends and making other restricted payments;

    entering into transactions with affiliates;

    entering into agreements that limit the ability of our subsidiaries from paying dividends, debt, loans or entering into other restrictions;

    amending the terms of other debt of ours;

    entering into sale and leaseback transactions; and

    materially modifying our workers compensation arrangements.

        We are also required to maintain financial covenants regarding leverage, coverage and fixed charges. These restrictions may limit our financial and operating flexibility and, as a result, reduce our ability to grow and execute on our strategic objectives. Our level of compliance with the financial covenants determines the maximum amount of the credit facility available to us. Additionally, if we fail to meet the minimum requirements of the financial covenants, and we are unable to obtain a waiver or amendment, the lender would have the right to terminate the credit agreement and require us to immediately repay all outstanding amounts. If we are unable to make borrowings under the credit agreement or were required to immediately repay all outstanding amounts, our cash flows, financial condition and results of operations could be materially and adversely affected.

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Our credit agreement contains restrictive covenants that may restrict our financial and operating flexibility.





        Our new credit agreement, which is fully secured by liens in substantially all the property and assets (with agreed upon carveouts and exceptions) of the Company,
restricts us and our subsidiaries from various actions, including the following, in each case subject to various specified exceptions:





    incurring
    liens and debt;


    making
    acquisitions;


    repurchasing
    shares of the Company's stock;


    making
    capital expenditures;


    making
    investments;


    entering
    into a merger, sale of all or substantially all of our assets or undergoing a change of control;


    selling
    assets;


    paying
    dividends and making other restricted payments;


    entering
    into transactions with affiliates;


    entering
    into agreements that limit the ability of our subsidiaries from paying dividends, debt, loans or entering into other restrictions;


    amending
    the terms of other debt of ours;


    entering
    into sale and leaseback transactions; and


    materially
    modifying our workers compensation arrangements.



        We
are also required to maintain financial covenants regarding leverage, coverage and fixed charges. These restrictions may limit our financial and operating flexibility and, as a
result, reduce our ability to grow and execute on our strategic objectives. Our level of compliance with the financial covenants determines the maximum amount of the credit facility available to us.
Additionally, if we fail to meet the minimum requirements of the financial covenants, and we are unable to obtain a waiver or amendment, the lender would have the right to terminate the credit
agreement and require us to immediately repay all outstanding amounts. If we are unable to make borrowings under the credit agreement or were required to immediately repay all outstanding amounts, our
cash flows, financial condition and results of operations could be materially and adversely affected.



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EXCERPTS ON THIS PAGE:

10-K (2 sections)
Mar 17, 2008
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