Document:

Exhibit 10.11

 

AMENDMENT TO FIFTH AMENDED AND RESTATED

ASSIGNABLE OPTION AGREEMENT

 

THIS AMENDMENT TO FIFTH
AMENDED AND RESTATED ASSIGNABLE OPTION AGREEMENT (this “Amendment”), is made
and entered into as of July 29, 2009, by and among Prospect Medical Systems, Inc.,
a Delaware corporation (“PMS”), Prospect Medical Group, Inc., a California
professional corporation (“PMG”), and Arthur Lipper, M.D. (“Shareholder”), with
reference to the following facts:

 

RECITALS

 

A.                                   The parties hereto  entered into
that certain Fifth Amended and Restated Assignable Option Agreement, dated as
of November 26, 2008 (the “Option Agreement”).

 

B.                                     Effective as of
the date hereof, Prospect Medical Holdings, Inc., the parent company of
PMS and an affiliate of PMG, refinanced its former senior credit facilities
with a new senior secured notes facility and a revolving credit facility (the “Credit
Facility Refinancing”).

 

C.                                     The parties
desire to amend the Option Agreement to account for the Credit Facility
Refinancing.

 

D.                                    The parties also
desire to amend the Option Agreement to eliminate the option to purchase the
assets of PMG and to leave only the option to purchase the stock of PMG.

 

NOW
THEREFORE, the parties to this Amendment hereby agree as follows:

 

AGREEMENT

 

1.                                       References to
Credit Facility.

 

a.                                       The first
sentence of Section 1.4 of the Option Agreement is hereby amended to read,
in its entirety, as follows:

 

“Except as set forth in the
First Lien Pledge Agreement, dated as of July 29, 2009 (the “Pledge
Agreement”), by and among Shareholder, PMG, PMS, Prospect Medical Holdings, Inc.
(“Borrower”), and U.S. Bank National Association, as collateral agent,
PMG shall not recognize any share transfer or other action not in compliance
with the terms of this Agreement.”

 

b.                                      The first paragraph
of Section 7.2 of the Option Agreement is hereby amended to read, in its
entirety, as follows:

 

“Except as required under: (a) the
Pledge Agreement; (b) the Indenture, dated as of July 29, 2009 (as
amended and restated, supplemented or otherwise modified from time to time, the
“Indenture”), among (i) Borrower, (ii) certain of its
subsidiaries and affiliates, as guarantors (the “Guarantors”), and (iii) U.S.
Bank National Association, as trustee; (c) the Credit Agreement, dated as
of July 29, 2009 (as amended and restated, supplemented or otherwise
modified from time to time, the “Credit Agreement” and together with the
Indenture, the “Credit Agreements”), among Borrower, the Guarantors, the
lenders from time to time party 

 

 

thereto, and Royal Bank of
Canada, as administrative agent; and (d) the other loan documents executed
in connection with the Credit Agreements; without the prior written consent of
PMS or the Applicable Management Companies, PMG and Shareholder shall not (and
shall not permit any other Professional Corporation or Successor Physician to):”

 

2.                                       Elimination of
Assets Option.

 

a.                                       Section 1.1
of the Option Agreement is hereby amended to read, in its entirety, as follows:

 

“1.1                           [Intentionally
omitted.]”

 

b.                                      All references
to the “Assets Option” are hereby deleted from the Option Agreement and all
references to the “Option” shall henceforth refer only to the “Stock Option.”  All references to the “Assets Exercise Notice”
are hereby deleted from the Option Agreement. 
All references to the assignment or sale of “Assets” are hereby deleted
from the Option Agreement, so that the Option Agreement shall henceforth only
contain references to the assignment or sale of “Stock.”

 

3.                                       Full Force and
Effect.  Except as provided above, the
Option Agreement shall remain in full force and effect.

 

[signature
page follows]

 

2

 

IN WITNESS WHEREOF, the
parties hereto have executed this Amendment as of the day and year first above
written.

 

	
   

  	
  “PMS”

  
	
   

  	
   

  
	
   

  	
  PROSPECT MEDICAL SYSTEMS,
  INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Samuel S. Lee

  
	
   

  	
  Name: Samuel S. Lee

  
	
   

  	
  Title: Chairman

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  “PMG”

  
	
   

  	
   

  
	
   

  	
  PROSPECT MEDICAL GROUP,
  INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Samuel S. Lee

  
	
   

  	
  Name: Samuel S. Lee

  
	
   

  	
  Title: Senior Vice
  President

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  “SHAREHOLDER”

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  /s/ Arthur Lipper, M.D.

  
	
   

  	
  Arthur Lipper, M.D.

  

 

3Exhibit 10.12

 

AMENDMENT TO THIRD AMENDED AND RESTATED

OPTION AGREEMENT

 

THIS AMENDMENT TO THIRD
AMENDED AND RESTATED OPTION AGREEMENT (this “Amendment”), is made and entered
into as of July 29, 2009, by and between Prospect Medical Group, Inc.,
a California professional corporation (“PMG”), and Arthur Lipper, M.D. (“Shareholder”),
with reference to the following facts:

 

RECITALS

 

A.                                   The parties hereto  entered into
that certain Third Amended and Restated Option Agreement, dated as of November 26,
2008 (the “Option Agreement”).

 

B.                                     Effective as of
the date hereof, Prospect Medical Holdings, Inc., an affiliate of PMG,
refinanced its former senior credit facilities with a new senior secured notes
facility and a revolving credit facility (the “Credit Facility Refinancing”).

 

C.                                     The parties
desire to amend the Option Agreement to account for the Credit Facility
Refinancing by deleting all references to the replaced financing facilities.

 

NOW
THEREFORE, the parties to this Amendment hereby agree as follows:

 

AGREEMENT

 

1.                                       Amendments.

 

a.                                       Section 7.2(a) of
the Option Agreement is hereby amended to read, in its entirety, as follows:

 

“(a)                            TRANSFER.  Sell, lease, transfer, or otherwise dispose
of the Shares;”

 

b.                                      Section 7.2(c) of
the Option Agreement is hereby amended to read, in its entirety, as follows:

 

“(c)                            NO FURTHER
HYPOTHECATION.  Pledge, hypothecate,
encumber, redeem or dispose of the Shares or any interest therein until all of
Physician’s obligations under this Agreement have been fully satisfied or the
Stock has been released;”

 

c.                                       Section 8.2
of the Option Agreement is hereby amended to read, in its entirety, as follows:

 

“8.2                           [Intentionally
omitted.]”

 

d.                                      Section 9.3
of the Option Agreement is hereby amended to read, in its entirety, as follows:

 

“9.3                           ASSIGNMENT.  All of PMG’s rights and duties under this
Agreement may be assigned or delegated by PMG. 
Notwithstanding any other provision of this Agreement, neither this
Agreement nor the rights and duties of this Agreement may be assigned or
delegated by Physician.  

 

 

This
Agreement binds the successors, heirs, and authorized assignees of the parties.”

 

2.                                       Full Force and
Effect.  Except as provided above, the
Option Agreement shall remain in full force and effect.

 

[signature
page follows]

 

2

 

IN WITNESS WHEREOF, the
parties hereto have executed this Amendment as of the day and year first above
written.

 

 

	
   

  	
  “PMG”

  
	
   

  	
   

  
	
   

  	
  PROSPECT MEDICAL GROUP,
  INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Samuel S. Lee

  
	
   

  	
  Name: Samuel S. Lee

  
	
   

  	
  Title: Senior Vice
  President

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  “SHAREHOLDER”

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  /s/ Arthur Lipper, M.D.

  
	
   

  	
  Arthur Lipper, M.D.

  

 

3Exhibit 10.1

 

SIXTH AMENDMENT TO LOAN AGREEMENT

DATED JANUARY 14,
2004

 

This Sixth Amendment to
Loan Agreement (the “Sixth Amendment”) is made as of this 18th day of August,
2009 by and between CRA International, Inc., formerly known as Charles
River Associates Incorporated (“Borrower”), a Massachusetts corporation with
its principal executive office at the John Hancock Tower, 200 Clarendon Street,
T-33, Boston, Massachusetts 02116-5092 and RBS Citizens, National Association,
successor by merger with Citizens Bank of Massachusetts, a national banking
association with offices at 28 State Street, Boston, Massachusetts (the “Lender”)
in consideration of the mutual covenants contained herein and the benefits to
be derived herefrom.  Unless otherwise
specified, all capitalized terms shall have the same meaning herein as set
forth in the Agreement (as defined below).

 

W I T N E S S E T
H:

 

WHEREAS, on January 14,
2004, the Borrower and the Lender entered into a loan arrangement (the “Loan
Arrangement”) as evidenced by, amongst other documents and instruments, a
certain Loan Agreement dated as of January 14, 2004, as amended by a First
Amendment to Loan Agreement dated as of March 29, 2005, amended by a
Second Amendment to Loan Agreement dated as of June 20, 2005 (the “Second
Amendment”), as amended by a Third Amendment to Loan Agreement dated as of April 17,
2006, as further amended by a Fourth Amendment to Loan Agreement dated as of July 25,
2006, as further amended by a Fifth Amendment to Loan Agreement dated as of May 16,
2007 (as may be amended from time to time, the “Agreement”) by and between the
Borrower and the Lender pursuant to which the Lender agreed to provide certain
financial accommodations to or for the benefit of the Borrower; and

 

WHEREAS, the Borrower has
requested that the Lender extend the Loan Arrangement and amend certain terms
and conditions of the Agreement, and

 

WHEREAS, the Lender has
agreed to so amend the Agreement provided the Borrower and the Lender entered
into this Sixth Amendment; and

 

NOW, THEREFORE, for good
and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:

 

1.             The definition of Credit Limit in Section 1(g) is
hereby deleted and replaced with the following:

 

“Credit
Limit shall mean an amount equal to Sixty Million ($60,000,000.00) Dollars.”

 

2.             Section 1(g) of the Agreement is hereby
amended by deleting the definition of Applicable Margin in its entirety and
replacing it with the following:

 

 

““Applicable Margin” shall mean at any time (i) 3.50%
per annum if the Total Debt Ratio (as defined in Section 10 hereof) at
such time is greater than or equal to 2.5x as of such time, (ii) 3.00% per
annum if the Total Debt Ratio at such time is greater than or equal to 2.0x but
less than 2.5x as of such time, (iii) 2.50% per annum if the Total Debt
Ratio at such time is greater than or equal to 1.5x but less than 2.0x as of
such time, (iv) 2.25% per annum if the Total Debt Ratio at such time is
greater than or equal to 1.0x but less than 1.5x as of such time, or (iv) 2.00%
per annum if the Total Debt Ratio at such time is less than 1.0x as of such
time.  For purposes of the foregoing, (i) the
Total Debt Ratio at any time shall be the Total Debt Ratio as reported in the
Compliance Certificate most recently delivered (or updated) by the Borrower to
Bank pursuant to Section 8(d) hereof, and (ii) each change in
the Applicable Margin pursuant to the foregoing provisions shall take effect
from the date of Borrower’s delivery of its most recent Compliance Certificate
(or update thereof) pursuant to Section 8(d) hereof.”

 

3.             Section 1 (u) of
the Agreement is hereby deleted in its entirety and replaced with the
following:

 

“In addition to all other sums payable hereunder,
the Borrower shall pay the Lender a fee equal to twenty five one-hundredths of
one percent (0.25%) of the difference between: (i) the Credit Limit (as it
may be reduced under clause (w) below) and (ii) the average daily
balance of (x) the aggregate outstanding principal amount of loans and
other extensions of credit hereunder plus (without duplication) (y) the
undrawn amounts and other obligations under outstanding Letters of Credit, for
each quarterly period this Agreement is in effect.  Such fee shall be payable quarterly in
arrears and, unless previously paid by the Borrower, shall be treated as a loan
to Borrower, which shall be added to Borrower’s loan balance pursuant to this
Agreement.”

 

4.             Section 9 (m) of
the Agreement is hereby deleted in its entirety.

 

5.             The definition of “subordinated debt” at the end of Section 10
of the Agreement is hereby supplemented by deleting the additional language
added pursuant to Section 6 of the Second Amendment and adding the
following at the end of the definition:

 

“including,
without limitation, the Borrower’s 2.875% Convertible Senior Subordinated
Debentures Due 2034 dated June 21, 2004 in the principal outstanding amount
of $72,780,000.00 as of August 1, 2009”

 

6.             Section 14(a) of the Agreement is hereby
amended by replacing the date “April 30, 2010” with the date “April 30,
2012”.

 

2

 

7.             The Borrower and the Lender
agree that Prime Rate Loans shall no longer be available under the Agreement.

 

8.             The Borrower hereby acknowledges and agrees that the
Borrower has no claims, offsets, defenses or counterclaims against the Lender
with respect to the Loan Arrangement or otherwise and to the extent the
Borrower may have any such claims the Borrower hereby WAIVES and RENOUNCES such
claims, offsets, defenses and counterclaims.

 

9.             This Sixth Amendment and all other documents executed
in connection herewith incorporate all discussions and negotiations between the
Borrower and the Lender either expressed or implied, concerning the matters
contained herein and in such other instruments, any statute, custom or use to
the contrary notwithstanding.  No such
discussions or negotiations shall limit, modify or otherwise effect the
provisions hereof.  The modification
amendment, or waiver of any provision of this Sixth Amendment, the Agreement or
any provision under any other agreement or document entered into between the
Borrower and the Lender shall not be effective unless executed in writing by
the party to be charged with such modification, amendment or waiver, and if
such party be the Lender, then by a duly authorized officer thereof.

 

10.           Except as specifically modified herein, the Agreement
shall remain in full force and effect as originally written, and the Borrower
hereby ratifies and confirms all terms and conditions contained in the
Agreement.

 

11.           This Sixth Amendment shall be construed in accordance
with and governed by the laws of the Commonwealth of Massachusetts and shall
take effect as a sealed instrument.

 

[Signature Page Follows]

 

3

 

IN
WITNESS WHEREOF, the parties hereof have set their hands and seals as of the
date first written above.

 

	
   

  	
  CRA INTERNATIONAL, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Wayne D.
  Mackie

  
	
   

  	
   

  	
  Executive Vice
  President, Treasurer,

  
	
   

  	
   

  	
  Chief Financial
  Officer

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  RBS CITIZENS, NATIONAL
  ASSOCIATION

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Christopher J.
  Wickles

  
	
   

  	
   

  	
  Senior Vice President

  

 

4

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