On December 31, 2012, WageWorks, Inc. entered into a Credit Agreement by and among the company, the guarantors from time to time party thereto, the lenders from time to time party thereto, and Union Bank, N.A., as administrative agent. The Credit Agreement amends and restates the Company's existing Commercial Credit Agreement, dated as of August 31, 2010, among the company, MHM Resources, LLC and Union Bank, N.A. The Credit Agreement provides for a $75.0 million revolving credit facility, with a $15 million letter of credit subfacility. The Credit Agreement contains an increase option permitting the company, subject to certain requirements, to arrange with existing lenders and/or new lenders to provide up to an aggregate of $75.0 million in additional commitments.

Loan proceeds may be used for general corporate purposes, including acquisitions permitted under the Credit Agreement. The company may prepay loans under the Credit Agreement in whole or in part at any time without premium or penalty. At December 31, 2012, the company had outstanding revolving loans in an aggregate principal amount of $44.6 million under the Credit Agreement and undrawn letters of credit in an aggregate principal amount of $3.3 million.

The loans bear interest, at the company's option, at (i) a base rate determined in accordance with the Credit Agreement, plus 0.25%, or (ii) a LIBOR rate determined in accordance with the Credit Agreement, plus 2.50%. Interest is due and payable in arrears quarterly for base rate loans and at the end of an interest period for LIBOR rate loans. Principal, together with all accrued and unpaid interest, is due and payable on December 31, 2015.

The company is also obligated to pay other customary closing fees, commitment fees and letter of credit fees for a facility of this size and type. The company's obligations under the Credit Agreement are secured by substantially all of the company's assets. All of the company's existing and future material subsidiaries are required to guaranty its obligations under the Credit Agreement.

The guarantees by existing and future material subsidiaries are and will be secured by substantially all of the assets of such material subsidiaries. The Credit Agreement provides that the company must maintain compliance with a liquidity ratio, a ratio of indebtedness to EBITDA, a debt service coverage ratio and a minimum consolidated net worth covenant.