1
EXHIBIT 10.6
U.S. $150,000,000
AMENDED AND RESTATED
CREDIT AGREEMENT
DATED AS OF JULY 1, 1997
AMONG
PHYCOR, INC.
AS BORROWER,
THE BANKS NAMED HEREIN,
AS BANKS,
AND
CITIBANK, N.A.,
AS AGENT
2
TABLE OF CONTENTS
Section Page
------- ----
ARTICLE I - DEFINITIONS AND ACCOUNTING TERMS...................................................................1
SECTION 1.01 Certain Defined Terms..................................................................1
SECTION 1.02 Computation of Time Periods...........................................................24
SECTION 1.03 Accounting Terms......................................................................24
ARTICLE II - AMOUNTS AND TERMS OF THE ADVANCES................................................................24
SECTION 2.01 The Committed Rate Advances...........................................................24
SECTION 2.02 The Competitive Bid Advances..........................................................26
SECTION 2.03 Fees..................................................................................29
SECTION 2.04 Optional Reduction of the Commitments.................................................30
SECTION 2.05 Repayment.............................................................................30
SECTION 2.06 Interest..............................................................................30
SECTION 2.07 Interest Rate Determination and Protection............................................31
SECTION 2.08 Voluntary and Automatic Conversion of Committed Rate Advances.........................32
SECTION 2.09 Prepayments...........................................................................32
SECTION 2.10 Increased Costs.......................................................................34
SECTION 2.11 Illegality............................................................................34
SECTION 2.12 Payments and Computations.............................................................35
SECTION 2.13 Taxes.................................................................................36
SECTION 2.14 Sharing of Payments, Etc..............................................................38
SECTION 2.15 Evidence of Debt/Register.............................................................38
SECTION 2.16 Use of Proceeds.......................................................................38
SECTION 2.17 Existing Credit Agreement B Advances; Existing Collateral.............................39
ARTICLE III - CONDITIONS OF LENDING...........................................................................39
SECTION 3.01 Conditions Precedent to Any Borrowing..................................................39
SECTION 3.02 Conditions Precedent to Initial Advances..............................................39
ARTICLE IV - REPRESENTATIONS AND WARRANTIES...................................................................41
SECTION 4.01 Representations and Warranties of the Borrower........................................41
ARTICLE V - COVENANTS OF THE BORROWER.........................................................................45
SECTION 5.01 Affirmative Covenants.................................................................45
SECTION 5.02 Negative Covenants....................................................................49
i
3
SECTION 5.03 Financial Covenants...................................................................58
SECTION 5.04 Reporting Requirements................................................................60
ARTICLE VI - EVENTS OF DEFAULT................................................................................62
SECTION 6.01 Events of Default.....................................................................62
ARTICLE VII - THE AGENT.......................................................................................66
SECTION 7.01 Authorization and Action..............................................................66
SECTION 7.02 Agent's Reliance, Etc.................................................................66
SECTION 7.03 Citibank and Affiliates...............................................................67
SECTION 7.04 Bank Credit Decision..................................................................67
SECTION 7.05 Indemnification.......................................................................67
SECTION 7.06 Successor Agent.......................................................................67
SECTION 7.07 Documentation Agent...................................................................68
ARTICLE VIII - MISCELLANEOUS..................................................................................68
SECTION 8.01 Amendments, Etc.......................................................................68
SECTION 8.02 Notices, Etc..........................................................................68
SECTION 8.03 No Waiver; Remedies...................................................................69
SECTION 8.04 Costs, Expenses and Taxes.............................................................69
SECTION 8.05 Right of Set-off......................................................................70
SECTION 8.06 Indemnification.......................................................................70
SECTION 8.07 Binding Effect........................................................................71
SECTION 8.08 Assignments and Participations........................................................71
SECTION 8.09 Headings..............................................................................74
SECTION 8.10 Confidentiality.......................................................................74
SECTION 8.11 Severability of Provisions............................................................74
SECTION 8.12 Independent of Provisions.............................................................74
SECTION 8.13 Consent to Jurisdiction...............................................................75
SECTION 8.14 GOVERNING LAW.........................................................................75
SECTION 8.15 WAIVER OF JURY TRIAL..................................................................75
SECTION 8.16 Execution in Counterparts.............................................................75
ii
4
SCHEDULES
Schedule I - Real Property
Schedule II - Subsidiaries
Schedule III - Service Agreements
Schedule IV - Existing Debt
Schedule V - Existing Liens
Schedule VI - Litigation
iii
5
EXHIBITS
Exhibit A-1 - Form of Committed Rate Note
Exhibit A-2 - Form of Competitive Bid Note
Exhibit B-1 - Form of Notice of Borrowing
Exhibit B-2 - Form of Competitive Bid Request
Exhibit C - Form of Guaranty
Exhibit D - Form of Intercompany Subordination Agreement
Exhibit E - Form of Assignment and Acceptance
Exhibit F - Form of Subordination Agreement
Exhibit G - Forms of Opinion of Counsel
Exhibit H - Form of Acquisition Approval Letter
iv
6
Amended and Restated Credit Agreement, dated as of July 1, 1997 (this
"Agreement"), among PHYCOR, INC., a Tennessee corporation (the "Borrower"), the
banks (the "Banks") listed on the signature pages hereof and from time to time
parties hereto, and CITIBANK, N.A. ("Citibank"), as agent (the "Agent") for the
Banks.
PRELIMINARY STATEMENT:
The Borrower has requested that a portion of the Fifth Amended and
Restated Revolving Credit Agreement, dated as of July 22, 1996, as amended,
among the Borrower, the banks named therein, NationsBank, N.A., as documentation
agent, and Citibank, as agent (the "Existing Credit Agreement") be amended and
restated to provide for the making of advances to it under a revolving credit
facility in the principal amount of up to $150,000,000, on the terms and
conditions set forth in this Agreement.
NOW, THEREFORE, the parties hereto agree as follows:
ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS
SECTION 1.01. Certain Defined Terms. As used in this Agreement, the
following terms shall have the following meanings (such meanings to be equally
applicable to both the singular and plural forms of the terms defined):
$250,000,000 Credit Agreement" means the Revolving
Credit Agreement, dated as of July 1, 1997, among the
Borrower, the banks named therein and Citibank as issuing bank
and as agent, providing for a revolving credit facility in the
principal amount of up to $250,000,000, as amended,
supplemented, restated or otherwise modified from time to
time.
"Accounts" means all present and future rights of the
Borrower or any Subsidiary of the Borrower to payment for
goods (including medications) sold or leased or for services
rendered pursuant to any Service Agreement (except those
evidenced by instruments or chattel paper), whether now
existing or hereafter arising and wherever arising and whether
or not earned by performance (including, without limitation,
accounts receivable purchased by the Borrower or any of its
Subsidiaries from any physician group which has entered into a
Service Agreement with the Borrower or such Subsidiary).
"Administrative Details Reply Form" means, with
respect to each Bank, an administrative questionnaire in the
form prepared by the Agent, submitted by such Bank to the
Agent (with a copy to the Borrower) and duly completed by such
Bank.
7
"Advance" means a Committed Rate Advance or a
Competitive Bid Advance. In the case of Committed Rate
Advances, "Advance" also refers to a Base Rate Advance or
Eurodollar Rate Advance (each of which shall be a "Type" of
Committed Rate Advance). In the case of Competitive Bid
Advances, "Advance" also refers to a Fixed Rate Advance or a
LIBOR Advance (each of which shall be a "Type" of Competitive
Bid Advance).
"Affiliate" means, with respect to any Person, any
other entity that, directly or indirectly through one or more
intermediaries, controls, is controlled by, or is under common
control with, such Person.
"Applicable Eurodollar Rate Margin" means for the
Initial Effective Period (as defined below) 0.4750% per annum
and thereafter 0.5625% per annum; provided, however, that if
the Borrower shall have satisfied the Consolidated Debt/EBITDA
Ratio test indicated in the table below, the Applicable
Eurodollar Rate Margin for any Advance, as applicable, made on
or after the fifth Business Day after the delivery of
quarterly certified Consolidated financial statements and a
schedule evidencing financial covenant compliance delivered to
the Banks pursuant to Section 5.04(b) (each a "Quarterly
Delivery"), and while the Borrower is in compliance with
Section 5.04(b), shall be the percentage rate per annum set
forth opposite the appropriate test for the fiscal quarter
reported on for such Quarterly Delivery for such Advance in
the table below.
Applicable Eurodollar
Consolidated Rate Margin for
Debt/EBITDA Ratio Advances
------------------------------------------------- ---------------------
Greater than 3.25 to 1.00 0.5625%
Less than or equal to 3.25 to 1.00 but greater 0.4750%
than 2.50 to 1.00
Less than or equal to 2.50 to 1.00 but greater 0.3750%
than 2.00 to 1.00
Less than or equal to 2.00 to 1.00 but greater 0.3175%
than 1.50 to 1.00
Less than or equal to 1.50 to 1.00 0.2750%
The Applicable Eurodollar Rate Margin shall be determined by
the Agent each quarter on the basis of quarterly certified
Consolidated financial statements and a schedule evidencing
financial covenant compliance delivered to the Banks pursuant
to Section 5.04(b). The "Initial Effective Period" shall be
the period commencing on the Closing Date and ended the fifth
Business Day after the Quarterly Delivery for the fiscal
quarter ending June 30, 1997. Notwithstanding
2
8
the foregoing, the Applicable Eurodollar Rate Margin shall be
deemed to be 0.5625% per annum made on any day as of which the
deliveries required to calculate the Applicable
Eurodollar Rate Margin shall not have been made.
"Applicable Facility Fee Rate" means for the Initial
Effective Period 0.1500% per annum and thereafter for each
Effective Period (as defined below) 0.1875% per annum;
provided, however, that if the Borrower shall have satisfied
the Consolidated Debt/EBITDA Ratio test indicated in the table
below, the Applicable Facility Fee Rate for the Effective
Period as to which such test is satisfied shall be the
percentage rate per annum set forth opposite the appropriate
test for the Commitment in the table below.
Consolidated Applicable Facility Fee
Debt/EBITDA Ratio Rate for the Commitment
----------------------------------------------- -------------------------------
Greater than 3.25 to 1.00 0.1875%
Less than or equal to 3.25 to 1.00 but greater 0.1500%
than 2.50 to 1.00
Less than or equal to 2.50 to 1.00 but greater 0.1250%
than 2.00 to 1.00
Less than or equal to 2.00 to 1.00 but greater 0.1200%
than 1.50 to 1.00
Less than or equal to 1.50 to 1.00 0.1000%
The Applicable Facility Fee Rate shall be determined by the
Agent each quarter on the basis of quarterly certified
Consolidated financial statements and a schedule evidencing
financial covenant compliance delivered to the Banks pursuant
to Section 5.04(b). The "Effective Period" with respect to the
Applicable Facility Fee Rate shall be the period commencing on
the fifth Business Day after the Borrower shall have delivered
to the Agent the quarterly certified Consolidated financial
statements and financial covenant compliance schedule for such
quarter and ending on the date that is five Business Days
after delivery to the Agent of quarterly certified
Consolidated financial statements and financial covenant
compliance certificate for the subsequent quarter.
Notwithstanding the foregoing, the Applicable Facility Fee
Rate shall be deemed to be 0.1875% per annum for each day
during an Effective Period as of which the deliveries required
to calculate the Applicable Facility Fee Rate shall not have
been made.
"Applicable Lending Office" means, with respect to
each Bank, such Bank's Domestic Lending Office in the case of
a Base Rate Advance or a Fixed
3
9
Rate Advance and such Bank's Eurodollar Lending Office in the
case of a Eurodollar Rate Advance or a LIBOR Advance.
"Asset Purchase Agreement" means any agreement
between the Borrower or any of its Subsidiaries and any Person
relating to the purchase by the Borrower or any of its
Subsidiaries of the assets of any Facility or Related
Business.
"Assignment and Acceptance" means an assignment and
acceptance entered into by an assigning Bank and an Eligible
Assignee, and accepted by the Agent, in accordance with
Section 8.08 and in substantially the form of Exhibit E.
"Banks" means the banks listed on the signature pages
hereof and, after the date hereof, includes each Eligible
Assignee that has entered into an Assignment and Acceptance
which has been accepted by the Agent.
"Base Rate" means, for any period, a fluctuating
interest rate per annum as shall be in effect from time to
time which rate per annum shall at all times be equal to the
highest of:
(a) the rate of interest announced publicly
by Citibank in New York, New York, from time to time,
as Citibank's base rate; or
(b) 1/2 of one percent per annum above the
latest three-week moving average of secondary market
morning offering rates in the United States for
three-month certificates of deposit of major United
States money market banks, such three-week moving
average being determined weekly on each Monday (or,
if any such day is not a Business Day, on the next
succeeding Business Day) for the three-week period
ending on the previous Friday by Citibank on the
basis of such rates reported by certificate of
deposit dealers to and published by the Federal
Reserve Bank of New York or, if such publication
shall be suspended or terminated, on the basis of
quotations for such rates received by Citibank from
three New York certificate of deposit dealers of
recognized standing selected by Citibank in either
case adjusted to the nearest 1/16 of one percent or,
if there is no nearest 1/16 of one percent, to the
next higher 1/16 of one percent; or
(c) the Federal Funds Rate plus 1/2 of one
percent.
"Base Rate Advance" means a Committed Rate Advance
which bears interest as provided in Section 2.06(a)(i).
"Bid Due Date" has the meaning set forth in Section
2.02(c).
"Borrowing" means a Borrowing that is a Committed
Rate Borrowing or a Competitive Bid Borrowing.
4
10
"Business Day" means a day of the year on which banks
are not required or authorized to close in New York City and,
if the applicable Business Day relates to any Eurodollar Rate
Advances or LIBOR Advances, on which dealings in dollar
deposits are carried on in the London interbank market.
"Capital Expenditures" means, with respect to any
Person for any period, the aggregate of all expenditures paid
or accrued by such Person during such period that, in
accordance with generally accepted accounting principles,
should be included in or reflected by the property, plant or
equipment or similar fixed asset account reflected in the
balance sheet of such Person.
"Capital Investments" means (without duplication),
with respect to any Person for any period, the aggregate of
all investments by such Person in (i) Capital Expenditures,
(ii) joint ventures, general or limited partnerships, limited
liability companies or any other type of Person that is not a
Subsidiary, including loans and advances to such Person
(including loans and advances to any physician group or other
third party related to a Facility or Related Business, or any
third party with whom such Person has entered into a Service
Agreement), (iii) capital investments in, and loans and
advances to, a Subsidiary which becomes a Subsidiary as a
result of such investment, (iv) the purchase of the homes of
employees of such Person in connection with the relocation of
such employees, and (v) Existing Clinic Acquisitions.
"Capital Lease" of any Person means any lease of any
property (whether real, personal or mixed) by such Person as
lessee, which lease should, in accordance with generally
accepted accounting principles, be required to be accounted
for as a capital lease on the balance sheet of such Person.
"CERCLA" means the Comprehensive Environmental
Response, Compensation, and Liability Act of 1980, as amended
(42 U.S.C. ss. 9601 et seq.), and any regulations promulgated
thereunder.
"Change of Control" means the occurrence, after the
date of this Agreement, of (i) any Person or two or more
Persons acting in concert acquiring beneficial ownership
(within the meaning of Rule 13d-3 of the Securities and
Exchange Commission under the Securities Exchange Act of 1934,
as amended), directly or indirectly, of securities of the
Borrower (or other securities convertible into such
securities) representing 50% or more of the combined voting
power of all securities of the Borrower entitled to vote in
the election of directors; or (ii) during any period of up to
24 consecutive months, commencing before or after the date of
this Agreement, individuals who at the beginning of such
24-month period were directors of the Borrower ceasing for any
reason to constitute a majority of the Board of Directors of
the Borrower unless the Persons replacing such individuals
were nominated by the Board of Directors of the Borrower; or
(iii) any Person or two or more Persons acting in concert
acquiring by contract or
5
11
otherwise, or entering into a contract or arrangement which
upon consummation will result in its or their acquisition of,
or control over, securities of the Borrower (or other
securities convertible into such securities) representing 50%
or more of the combined voting power of all securities of the
Borrower entitled to vote in the election of directors.
"Closing Date" means the Business Day on which all of
the conditions set forth in Section 3.02 shall have been
fulfilled.
"Committed Rate Advance" means an Advance pursuant to
Section 2.01.
"Committed Rate Borrowing" means a Borrowing pursuant
to Section 2.01.
"Committed Rate Note" means a promissory note of the
Borrower payable to the order of a Bank, in substantially the
form of Exhibit A-1, evidencing the aggregate indebtedness of
the Borrower to such Bank resulting from the Committed Rate
Advances made by such Bank, and "Committed Rate Notes" means
such promissory notes collectively.
"Commitment" means, as to any Bank, the amount of
commitment to make Committed Rate Advances set forth opposite
such Bank's name on the signature pages hereof or, if such
Bank has entered into one or more Assignments and Acceptances,
the amount thereof set forth for such Bank in the Register
maintained by the Agent pursuant to Section 8.08(c), as such
amount may be reduced from time to time pursuant to Section
2.04.
"Commitment Percentage" means, as to any Bank, the
percentage equal to such Bank's Commitment divided by the
aggregate Commitments of all Banks.
"Common Stock" means Securities having ordinary
voting power for the election of directors that are not
entitled to any preference as to dividends or other
distributions or on liquidation.
"Competitive Bid" has the meaning set forth in
Section 2.02(c).
"Competitive Bid Advance" means an Advance made
pursuant to Section 2.02.
"Competitive Bid Reduction" has the meaning set forth
in Section 2.01(a).
"Compeititive Bid Borrowing" means a Borrowing
pursuant to Section 2.02.
"Competitive Bid Note" means a promissory note of the
Borrower payable to the order of a Designated Bidder, in
substantially the form of Exhibit A-2,
6
12
evidencing the indebtedness of the Borrower to such Designated
Bidder resulting from Competitive Bid Advances made by such
Designated Bidder, and "Competitive Bid Notes" means such
promissory notes collectively.
"Competitive Bid Request" has the meaning set forth
in Section 2.02(b).
"Consolidated" and any derivative thereof each means,
with reference to the accounts or financial reports of any
Person, the consolidated accounts or financial reports of such
Person and each Subsidiary of such Person determined in
accordance with generally accepted accounting principles,
including principles of consolidation, consistent with those
applied in the preparation of the Borrower's December 31, 1996
Consolidated financial statements delivered to the Banks prior
to the date hereof.
"Contingent Obligation" of any Person means, without
duplication, (i) any direct or indirect liability, contingent
or otherwise, of such Person with respect to any obligation of
the type specified in clause (ii) or (iii) below or other
obligation of another Person, including, without limitation,
any obligation directly or indirectly guaranteed, endorsed
(other than for collection or deposit in the ordinary course
of business), co-made, discounted or sold with recourse by
such Person, or in respect of which such Person is otherwise
directly or indirectly liable (including, without limitation,
liable through any agreement to purchase, repurchase or
otherwise acquire such obligation or provide or purchase any
security therefor, or to provide funds for the payment or
discharge of such obligation, or to maintaining any financial
condition of the obligor of such obligation, or to make
payment for any products, materials or supplies or for any
transportation, services or lease (regardless of the
non-delivery or non-furnishing thereof), in any such case if
the purpose or intent of such agreement is to provide
assurance that such obligation will be paid or discharged, or
that any agreements relating thereto will be complied with, or
that the holders of such obligation will be protected against
loss in respect thereof), (ii) obligations of such Person with
respect to undrawn letters of credit or unpaid bankers'
acceptances, bankers' assurances or guarantees or similar
items, and (iii) obligations of such Person with respect to
any interest rate protection, hedge, cap, collar or similar
agreement or any foreign exchange or forward sale agreement,
or any similar agreement.
"Convert", "Conversion" and "Converted" each refers
to a conversion of Advances of one Type into Advances of
another Type pursuant to Section 2.07 or 2.08.
"Current Liabilities" of any Person means, as of any
date of determination, (i) all Debt (excluding any Debt under
Operating Leases) which by its terms is payable on demand or
matures within one year from the date of creation (excluding
any Debt renewable or extendible, at the exclusive option of
the debtor, to a date more than one year from such date or
arising under a revolving
7
13
credit or similar agreement that unconditionally obligates the
lender or lenders to extend credit in respect thereof during a
period of more than one year from such date), and (ii) all
other items (including taxes accrued as estimated) which in
accordance with generally accepted accounting principles
should be included as current liabilities of such Person, in
each case, including all amounts required to be paid or
prepaid with respect to any Debt of such Person within one
year from the date of determination.
"Debt" of any Person means, without duplication, (i)
all indebtedness of such Person for borrowed money or for the
deferred purchase price of property or services (but
excluding, in the case of the acquisition of any Facility (or
the assets thereof), any Existing Clinic Acquisition or the
acquisition of a Related Business, any contingent obligation
to make payments (other than deferred purchase price payments)
after the closing of such acquisition), (ii) all obligations
of such Person in connection with any agreement to purchase,
redeem, exchange, convert or otherwise acquire for value any
Securities of such Person or any warrants, rights or options
to acquire such Securities, now or hereafter outstanding,
(iii) all obligations of such Person evidenced by bonds,
notes, debentures, convertible debentures or other similar
instruments, (iv) all indebtedness created or arising under
any conditional sale or other title retention agreement with
respect to property acquired by such Person (even though the
rights and remedies of the seller or lender under such
agreement in the event of default, acceleration, or
termination are limited to repossession or sale of such
property), (v) all obligations of such Person under Capital
Leases, (vi) the amount of all Contingent Obligations (other
than guarantees of medical group real property leases at
Facilities to the extent the amount thereof incurred in any
twelve - month period does not exceed $5,000,000 in the
aggregate), (vii) all Debt referred to in clause (i), (ii),
(iii), (iv), (v) or (vi) above secured by (or for which the
holder of such Debt has an existing right, contingent or
otherwise, to be secured by) any lien, security interest or
other charge or encumbrance upon or in property (including,
without limitation, accounts and contract rights) owned by
such Person, even though such Person has not assumed or become
liable for the payment of such Debt, (viii) all mandatorily
redeemable preferred stock, valued at the applicable
redemption price, plus accrued and unpaid dividends payable in
respect of such mandatorily redeemable preferred stock, (ix)
if an ERISA Event shall have occurred with respect to any
Plan, the Insufficiency (if any) of such Plan (or, in the case
of a Plan with respect to which an ERISA Event described in
clauses (iii) through (vi) of the definition of ERISA Event
shall have occurred, the liability related thereto), and (x)
net obligations under any interest rate, currency or other
protection, hedge, cap, collar, swap or similar agreement.
"Debt/EBITDA Ratio" of any Person means, at any date
of determination, the ratio that (a) such Person's total Debt
outstanding at such date of determination (including, without
limitation, all Subordinated Debt other than, in the case of
the Borrower and its Subsidiaries, the Excluded Convertible
Acquisition Debt), less
8
14
the amount, if any, by which such Person's unrestricted cash
and cash equivalents exceeds $15,000,000 at such date of
determination, bears to (b) such Person's EBITDA.
"Debt/Total Capitalization Ratio" of any Person
means, at any date of determination, the ratio that such
Person's Funded Debt at such date of determination bears to
such Person's Total Capitalization.
"Deferred Acquisition Consideration" means, in the
case of the acquisition of any Facility (or the assets
thereof) or any Related Business, all deferred cash and
non-cash consideration to be paid by the Borrower or any of
its Subsidiaries after the closing of such acquisition;
provided that Deferred Acquisition Consideration shall not
include any contingent payments that may be made by the
Borrower or any of its Subsidiaries after such closing.
"Designated Bidder" means each Bank (or its nominee
so long as the beneficial interest in the Competitive Bid
Advances held by such nominee is retained by such Bank) unless
such Bank has elected, by notice in writing to the Agent, the
other Banks and the Borrower, not to be a potential bidder in
respect of Competitive Bid Advances. Any such election may be
terminated, at any time, by notice in writing to the Agent,
the other Banks and the Borrower.
"Documentation Agent" means NationsBank, N.A.
"Domestic Lending Office" means, with respect to any
Bank, the office of such Bank specified as its "Domestic
Lending Office" in its Administrative Details Reply Form or on
the signature page of the Assignment and Acceptance pursuant
to which it became a Bank, or such other office or Affiliate
of such Bank as such Bank may from time to time specify to the
Borrower and the Agent.
"EBITDA" means, with respect to any Person for any
fiscal period, the sum (without duplication) of (i) Net Income
(whether positive or negative), plus (ii) Interest Expense,
plus (iii) income tax expense, plus (iv) depreciation expense,
plus (v) amortization expense, plus (vi) extraordinary losses
(determined in accordance with GAAP), minus (vi) extraordinary
gains (determined in accordance with GAAP).
"EBITDAL" means, with respect to any Person for any
fiscal period, the sum (without duplication) of EBITDA plus
Lease Expense.
"Eligible Assignee" means (i) a commercial bank
organized under the laws of the United States, or any state
thereof, having a combined capital and surplus of at least
$100,000,000; (ii) a savings and loan association or savings
bank organized under the laws of the United States or any
state thereof, and having a combined capital and surplus of at
least $100,000,000; (iii) a commercial bank organized under
the laws of any other country which is a member of the OECD,
9
15
or a political subdivision of any such country, and having a
combined capital and surplus of at least $100,000,000,
provided, that, such bank is acting through a branch, agency
or Affiliate located in the United States or managed and
controlled by a branch, agency or affiliate located in the
United States; (iv) any Affiliate of any Bank if such
Affiliate has Total Assets in excess of $100,000,000; (v) any
insurance company organized under the laws of the United
States or any state thereof, and having Total Assets in excess
of $100,000,000 and any other commercial financial entity
having Total Assets in excess of $100,000,000; and (vi) any
other Person mutually agreed to in writing by the Borrower and
the Agent.
"Environmental Activity" means any past, present or
future storage, holding, existence, release, threatened
release, emission, discharge, generation, processing,
abatement, disposition, handling or transportation of any
Hazardous Substance (i) from, under, into or on any Facility,
or (ii) relating to any Facility, or the ownership, use,
operation or occupancy thereof, or any threat of such
activity.
"Environmental Laws" means any and all laws,
statutes, ordinances, rules, regulations, judgments, orders,
decrees, permits, licenses, or other governmental restrictions
or requirements relating to the environment, any Hazardous
Substance or any Environmental Activity in effect in any and
all jurisdictions in which the Borrower or any of its
Subsidiaries is or from time to time may be doing business, or
where any of the Facilities are from time to time located,
including, without limitation, CERCLA and RCRA.
"ERISA" means the Employee Retirement Income Security
Act of 1974, as amended from time to time, and the regulations
promulgated and rulings issued thereunder.
"ERISA Affiliate" means any Person who for purposes
of Title IV of ERISA is a member of the Borrower's controlled
group, or under common control with the Borrower, within the
meaning of Section 414 of the Internal Revenue Code of 1986,
as amended from time to time, and the regulations promulgated
pursuant thereto and the rulings issued thereunder.
"ERISA Event" means (i) the occurrence of a
reportable event, within the meaning of Section 4043 of ERISA,
unless the 30-day notice requirement with respect thereto has
been waived by the PBGC; (ii) the provision by the
administrator of any Plan of a notice of intent to terminate
such Plan, pursuant to Section 4041(a)(2) of ERISA (including
any such notice with respect to a plan amendment referred to
in Section 4041(e) of ERISA); (iii) the cessation of
operations at a facility in the circumstances described in
Section 4062(e) of ERISA; (iv) the withdrawal by the Borrower
or an ERISA Affiliate from a Multiple Employer Plan during a
plan year for which it was a substantial
10
16
employer, as defined in Section 4001(a)(2) of ERISA; (v) the
failure by the Borrower or any ERISA Affiliate to make a
material payment to a Plan required under Section 302(f)(1) of
ERISA; (vi) the adoption of an amendment to a Plan requiring
the provision of initial or additional security to such Plan,
pursuant to Section 307 of ERISA; or (vii) the institution by
the PBGC of proceedings to terminate a Plan, pursuant to
Section 4042 of ERISA, or the occurrence of any event or
condition which might constitute grounds under Section 4042 of
ERISA for the termination of, or the appointment of a trustee
to administer, a Plan.
"Eurocurrency Liabilities" has the meaning assigned
to that term in Regulation D of the Board of Governors of the
Federal Reserve System, as in effect from time to time.
"Eurodollar Lending Office" means, with respect to
any Bank, the office of such Bank specified as its "Eurodollar
Lending Office" in its Administrative Details Reply Form or on
the signature page of the Assignment and Acceptance pursuant
to which it became a Bank (or, if no such office is specified,
its Domestic Lending Office), or such other office of such
Bank as such Bank may from time to time specify to the
Borrower and the Agent.
"Eurodollar Rate" means, for any Interest Period for
each Eurodollar Rate Advance or LIBOR Advance comprising part
of the same Borrowing, an interest rate per annum obtained by
dividing (i) the rate of interest determined by the Agent to
be equal to the average (rounded upward to the nearest whole
multiple of 1/16 of one percent per annum, if such average is
not such a multiple) of the rate per annum at which deposits
in United States dollars are offered by the principal office
of Citibank in London to prime banks in the London interbank
market at 11:00 A.M. (London time) two Business Days before
the first day of such Interest Period in an amount
substantially equal to the Advance comprising part of such
Borrowing and for a period equal to such Interest Period by
(ii) a percentage equal to 100% minus the Eurodollar Rate
Reserve Percentage for such Interest Period. The Eurodollar
Rate for any Interest Period for each Eurodollar Rate Advance
or LIBOR Advance comprising part of the same Borrowing shall
be determined by the Agent on the basis of applicable rates
furnished to and received by the Agent from Citibank two
Business Days before the first day of such Interest Period,
subject, however, to the provisions of Section 2.07.
"Eurodollar Rate Advance" means a Committed Rate
Advance which bears interest as provided in Section
2.06(a)(ii).
"Eurodollar Rate Reserve Percentage" of any Bank for
any Interest Period for any Eurodollar Rate Advance or LIBOR
Advance means the reserve percentage applicable during such
Interest Period (or if more than one such percentage shall be
so
11
17
applicable, the daily average of such percentages for those
days in such Interest Period during which any such percentage
shall be so applicable) under regulations issued from time to
time by the Board of Governors of the Federal Reserve System
(or any successor) for determining the maximum reserve
requirement (including, without limitation, any emergency,
supplemental or other marginal reserve requirement) for such
Bank with respect to liabilities or assets consisting of or
including Eurocurrency Liabilities having a term equal to such
Interest Period.
"Event of Default" has the meaning specified in
Section 6.01.
"Excluded Convertible Acquisition Debt" means the
subordinated convertible notes issued by the Borrower or any
of its Subsidiaries as consideration for the acquisition of
Facilities that, at any date of determination, are convertible
into shares of the Borrower's common stock having a Market
Value, as of such date, equal to 140% of the conversion price
of such notes.
"Existing Clinic Acquisition" means the acquisition
of an additional Facility or single-specialty clinic, or the
assets thereof, by the Borrower or a Subsidiary of the
Borrower which already owns and operates one or more
Facilities, or the addition of physicians to such Facilities,
which acquisition or addition will supplement the operations
of the existing Facilities.
"Facility" means any multi-specialty medical clinic
(including any satellite locations and all real, personal and
mixed property relating to any such clinic) and related
businesses certain of the assets of which are now owned or
leased and operated or hereafter owned or leased and operated
by the Borrower or any existing or future Subsidiary of the
Borrower or, in the case of an acquisition, that such a
Subsidiary intends to acquire.
"Federal Funds Rate" means, for any period, a
fluctuating interest rate per annum equal for each day during
such period to the weighted average of the rates on overnight
Federal funds transactions with members of the Federal Reserve
System arranged by Federal funds brokers, as published for
such day (or, if such day is not a Business Day, for the next
preceding Business Day) by the Federal Reserve Bank of New
York, or, if such rate is not so published for any day which
is a Business Day, the average of the quotations for such day
on such transactions received by the Agent from three Federal
funds brokers of recognized standing selected by it.
"Fixed Charge Coverage Ratio" of any Person means, at
any date of determination for any period, the ratio that such
Person's EBITDAL for such period, minus (i) Consolidated cash
income tax expense and minus (ii) Capital Expenditures other
than Capital Expenditures which are funded by Advances or
other Debt (to the extent such Debt is permitted under this
Agreement) or by Net Cash Proceeds received from the issuance,
sale or disposition of the Borrower's Securities (common,
preferred or special), securities convertible into or
12
18
exchangeable for Securities, and any rights, options, warrants
and similar instruments, bears to such Person's Interest
Expense for such period plus (i) Lease Expense, and plus (ii)
all scheduled Debt principal payments (including the principal
component of payments in respect of Capital Leases but
excluding payments of any deferred purchase price in
connection with the acquisition of any Facility (or the assets
thereof), any Existing Clinic Acquisition or the acquisition
of any Related Business and any contingent payments made in
connection with such acquisition) for such period.
"Fixed Rate" has the meaning set forth in Section
2.02(c).
"Fixed Rate Advance" means a Competitive Bid Advance
which bears interest as provided in Section 2.06(b).
"Funded Debt" of any Person means Debt (including,
without limitation, all Subordinated Debt other than, in the
case of the Borrower and its Subsidiaries, the Excluded
Convertible Acquisition Debt) which matures more than one year
from the date of determination or matures within one year from
such date but is renewable or extendible, at the option of
such Person, to a date more than one year from such date or
arises under a revolving credit or similar agreement which
obligates the lender or lenders to extend credit during a
period of more than one year from such date, including,
without limitation, all amounts of Funded Debt required to be
paid or prepaid within one year from the date of
determination.
"Guarantors" means the Subsidiaries listed on
Schedule II hereto and each other Subsidiary that from time to
time may enter into a Guaranty pursuant hereto; provided that
Immaterial Subsidiaries shall not be required to be
Guarantors; provided further that Xxxxxx Health Systems, Inc.
and its Subsidiaries as of the date hereof (the "Xxxxxx
Subsidiaries") shall not be Guarantors so long as less than
3.0% of the EBITDA of the Borrower and its Subsidiaries
(calculated on a rolling four quarter basis) is attributable
to their interests in the Xxxxxx Subsidiaries.
"Guaranty" means a guaranty of payment in favor of
the Agent, in substantially the form of Exhibit C, as amended,
supplemented, restated or otherwise modified from time to
time.
"Hazardous Substance" means (i) any hazardous
substance and toxic substance as such terms are presently
deemed or used in ss. 101(14) of CERCLA (42 U.S.C. ss.
9601(14)), in 33 U.S.C. ss. 1251 et seq. (Clean Water Act), or
15 U.S.C. ss. 2601 et seq. (Toxic Substances Control Act),
(ii) any additional substances or materials which are now or
hereafter hazardous or toxic substances under any applicable
laws, and (iii) as of any date of determination, any
additional substances or materials which are hereafter
incorporated in or added to the definition or use of
"hazardous substance" or "toxic substance" for purposes of
CERCLA or any other applicable law.
13
19
"Immaterial Subsidiary" means a Subsidiary of the
Borrower that, on a Consolidated basis with its Subsidiaries,
as of the end of each fiscal quarter, does not account for 1%
or more of the Consolidated Total Assets of the Borrower or 1%
or more of the Consolidated total revenues of the Borrower, as
determined in accordance with generally accepted accounting
principles; provided that if as of the end of any fiscal
quarter the Immaterial Subsidiaries shall account, in the
aggregate, for 5% or more of the Consolidated Total Assets of
the Borrower or 5% or more of the Consolidated total revenues
of the Borrower as so determined, the Borrower shall promptly,
by written notice to the Agent, designate one or more of such
Subsidiaries not to be Immaterial Subsidiaries so that the
Immaterial Subsidiaries do not account for 5% or more of such
Consolidated Total Assets or such Consolidated total revenues,
and the Subsidiaries so designated shall thereupon cease to be
Immaterial Subsidiaries.
"Indemnitee" or "Indemnitees" has the meaning set
forth in Section 8.06.
"Insufficiency" means, with respect to any Plan, the
amount, if any, of its unfunded benefit liabilities, as
defined in Section 4001(a)(18) of ERISA.
"Intercompany Creditor" means PhyCor of Nashville,
Inc., a Tennessee corporation and wholly owned Subsidiary of
the Borrower.
"Intercompany Debt" means any and all indebtedness
from time to time owed (i) to the Borrower by any of its
Subsidiaries, (ii) to the Intercompany Creditor by any other
Subsidiary of the Borrower, or (iii) to any Subsidiary of the
Borrower by the Borrower, including any investments by the
Borrower in any of its Subsidiaries to the extent such
investments are made in the form of loans or advances by the
Borrower to such Subsidiary. All Intercompany Debt shall be
payable on demand.
"Intercompany Subordination Agreement" means an
intercompany subordination agreement in substantially the form
of Exhibit D among the Borrower and each of its Subsidiaries
other than, subject to Section 5.01(j), Immaterial
Subsidiaries, as the same may be amended, supplemented or
otherwise modified from time to time.
"Interest Expense" of any Person means the aggregate
amount of interest paid, accrued or scheduled to be paid or
accrued in respect of any Debt (including the interest portion
of rentals under Capital Leases, but excluding, in the case of
the Borrower and its Subsidiaries, any interest paid, accrued
or scheduled to be paid or accrued in respect of the Excluded
Convertible Acquisition Debt to the extent, and only to the
extent, that such interest is offset by a corresponding
increase in fees payable to the Borrower or its Subsidiary
pursuant to the Service Agreement relating to such
acquisition) and all but the principal component of payments
in respect of conditional sales, equipment trust or other
title retention
14
20
agreements paid, accrued or scheduled to be paid or accrued by
such Person, in each case determined in accordance with
generally accepted accounting principles.
"Interest Period" means, for each Eurodollar Rate
Advance or LIBOR Advance, as the case may be, comprising part
of the same Borrowing, the period commencing on the date of
such Advance or, in the case of a Eurodollar Rate Advance, the
date of the Conversion of any Advance into such Type of
Advance and ending on the last day of the period selected by
the Borrower pursuant to the provisions below and, thereafter,
in the case of a Eurodollar Rate Advance, each subsequent
period commencing on the last day of the immediately preceding
Interest Period and ending on the last day of the period
selected by the Borrower pursuant to the provisions below. The
duration of each such Interest Period shall be one, two, three
or six months in the case of a Eurodollar Rate Advance or a
LIBOR Advance; provided, however, that:
(i) the Borrower may not select any Interest Period
which ends after the Revolver Termination Date;
(ii) Interest Periods commencing on the same date for
Advances comprising part of the same Committed Rate Borrowing
shall be of the same duration;
(iii) whenever the last day of any Interest Period
would otherwise occur on a day other than a Business Day, the
last day of such Interest Period shall be extended to occur on
the next succeeding Business Day; provided, in the case of any
Interest Period for a Eurodollar Rate Advance or LIBOR
Advance, that if such extension would cause the last day of
such Interest Period to occur in the next following calendar
month, the last day of such Interest Period shall occur on the
next preceding Business Day; and
(iv) the Borrower may not have more than eight
Eurodollar Rate Borrowings outstanding on any given date.
"Investment Grade" means a rating of Debt of at least
BBB by Standard & Poor's Ratings Group or Baa2 by Xxxxx'x
Investors Service, Inc.
"Lease" means any lease, rental contract, occupancy
agreement, license or other arrangement pursuant to which any
Person occupies or has the right to occupy all or any part of
the Real Property.
"Lease Expense" of any Person means all payments made
by such Person under Operating Leases. For the purpose of
calculating the Fixed Charge Coverage Ratio of the Borrower
and its Subsidiaries, Lease Expense shall refer to all
payments made by (i) PhyCor Vero Beach pursuant to that
certain Lease entered into by and between PhyCor Vero Beach
and Healthcare Realty Trust, and
15
21
(ii) the Borrower or any of its Subsidiaries in connection
with any other Lease entered into in the future by such Person
which is not cancelable upon termination of the related
Service Agreement or for which the payments thereunder are not
fully reimbursable to the Borrower or such Subsidiary pursuant
to the related Service Agreement.
"LIBOR Advance" means a Competitive Bid Advance which
bears interest as provided in Section 2.06(b).
"LIBOR Margin" has the meaning set forth in Section
2.02(c).
"Lien" means any assignment, chattel mortgage, pledge
or other security interest or any mortgage, deed of trust or
other lien, or other charge or encumbrance, upon property or
rights (including after-acquired property or rights), or any
preferential arrangement with respect to property or rights
(including after-acquired property or rights) which has the
practical effect of constituting a security interest or lien.
"Loan Documents" means this Agreement, the Notes, the
Guaranty, the Subordination Agreements, the Intercompany
Subordination Agreement and all other documents delivered by
the Loan Parties in connection with this Agreement, in each
case as amended, supplemented, restated or otherwise modified
from time to time.
"Loan Party" means, individually, the Borrower and
each Guarantor; and "Loan Parties" means the Borrower and the
Guarantors, collectively.
"Majority Banks" means, at any time, Banks holding at
least 66-2/3% of the then aggregate unpaid principal amount of
the Committed Rate Advances owing to the Banks, or, if no such
principal amount is then outstanding, having at least 66-2/3%
of the Commitments.
"Market Value" means, with respect to any publicly
traded Security at any date of determination, the amount equal
to the average closing price for such Security during the 15
trading days immediately preceding the date of determination.
The closing price of a publicly traded security on each day
shall be the closing price on such day as reported on any
stock exchange, the National Market System of the National
Association of Securities Dealers' Automated Quotation System,
or an established securities quotation service, as the case
may be.
"Merger Agreement" means any agreement between the
Borrower or any of its Subsidiaries and any Person relating to
the purchase by and merger into the Borrower or any of its
Subsidiaries of any Facility (or the assets thereof) or any
Related Business.
16
22
"Multiemployer Plan" means a "multiemployer plan" as
defined in Section 4001(a)(3) of ERISA to which the Borrower
or any ERISA Affiliate is making or accruing an obligation to
make contributions, or has within any of the preceding five
plan years made or accrued an obligation to make
contributions, such plan being maintained pursuant to one or
more collective bargaining agreements.
"Multiple Employer Plan" means a single employer
plan, as defined in Section 4001(a)(15) of ERISA, which (i) is
maintained for employees of the Borrower or an ERlSA Affiliate
and at least one Person other than the Borrower and its ERISA
Affiliates or (ii) was so maintained and in respect of which
the Borrower or any ERISA Affiliate could have liability under
Section 4064 or 4069 of ERISA in the event such plan has been
or were to be terminated.
"NAMM" means North American Medical Management, Inc.,
a Tennessee corporation.
"Net Cash Proceeds" means, as to any sale, lease or
other disposition of any Facility (or the assets thereof) or
any Related Business, or of the assets of the Borrower and its
Subsidiaries, by the Borrower or any Subsidiary of the
Borrower to any Person other than the Borrower or any
Subsidiary of the Borrower, or the sale or issuance of any
Securities, any securities convertible into or exchangeable
for Securities, or any warrants, rights or options to acquire
Securities of the Borrower or any of its Subsidiaries to any
Person other than the Borrower or any Subsidiary of the
Borrower (other than such sale or issuance pursuant to the
Borrower's employee stock purchase plans or employee and
director stock option plans and other than the issuance of
Securities as consideration for the acquisition of any
Facility (or the assets thereof), any Existing Clinic
Acquisition or the acquisition of any Related Business to the
extent such acquisition satisfies the applicable requirements
of Section 5.02(f)(i) or (ii)), or the issuance of any
Subordinated Debt, whether convertible into or exchangeable
for Securities (other than in the case of the Borrower and its
Subsidiaries, the subordinated convertible notes issued by the
Borrower or any of its Subsidiaries as consideration for the
acquisition of Facilities (or the assets thereof), Existing
Clinic Acquisitions or the acquisition of Related Businesses),
an amount equal to (i) the cash and other consideration paid
by such Person (but not including (i) any Debt of the Borrower
or its Subsidiaries assumed by such Person in connection with
such sale, lease or other disposition or (ii) any Debt of the
Borrower or its Subsidiaries owed to such Person which is
offset against the Total Consideration of such Facility or
Related Business), minus (ii) the sum of (A) in the case of a
Facility, the unpaid principal balance on the date of such
sale or other disposition of any Debt secured by a Lien on
such Facility that may be accelerated as a result of such sale
or secured by Liens not prohibited by the terms of this
Agreement and affecting only such Facility, in each case which
is required to be repaid, and is actually repaid, by the
Borrower or any of its existing or future Subsidiaries on the
date of such sale or
17
23
other disposition, (B) any tax paid or payable by the Borrower
or any of its existing or future Subsidiaries in connection
with or as a consequence of such sale or other disposition
(excluding any such tax for which the Borrower or any of its
existing or future Subsidiaries seller is reimbursed by such
Person to the extent not otherwise included in the
determination of Net Cash Proceeds), (C) the amount of any
reserve (other than in respect of inventory) required to be
retained in connection with such sale or other disposition
under generally accepted accounting principles (excluding any
reserve in respect of any amounts not payable within 180
days), provided, however, that the unused amount of such
reserve at the termination of such reserve in accordance with
generally accepted accounting principles shall be deemed Net
Cash Proceeds in the amount of such unused amount, and (D)
reasonable out-of-pocket costs of such sale or other
disposition incurred by the Borrower or any of its existing or
future Subsidiaries to third parties directly in connection
therewith, including, without limitation, sales commissions,
escrow fees, legal fees, title insurance premiums and similar
expenses.
"Net Income" of any Person, for any period, means the
net income of such Person for such period, determined in
accordance with generally accepted accounting principles,
excluding:
(i) the proceeds of any life insurance policy;
(ii) any earnings (or losses), prior to the date of
acquisition, of any other Person acquired in any manner;
(iii) in the case of a successor to such Person by
consolidation or merger or a transferee of its assets, any
earnings (or losses) of the successor or transferee
corporation prior to the consolidation, merger or transfer of
assets; and
(iv) any deferred credit (or debit) (or amortization
of a deferred credit) arising from the acquisition of any
Person.
"Net Worth" of any Person, as of any date of
determination, means the excess of such Person's Total Assets
over Total Liabilities.
"Note" means a Committed Rate Note or a Competitive
Bid Note, and "Notes" means such promissory notes
collectively.
"Notice of Borrowing" means a written notice, in
substantially the form of Exhibit B-1 hereto, delivered in
accordance with, and within the periods specified in, Section
2.01(b).
"OECD" means the Organization for Economic
Cooperation and Development or any successor.
18
24
"Operating Lease" means any lease of real, personal
or mixed property which is not a Capital Lease.
"Other Taxes" has the meaning set forth in Section
2.13(b).
"PBGC" means the Pension Benefit Guaranty Corporation
or any successor.
"Permitted Lien" means:
(i) Any Liens (other than Liens securing Debt,
taxes, assessments or governmental charges or levies,
obligations under ERISA or the Environmental Laws, or other
obligations) affecting any of the Real Property which do not
materially adversely affect the use of such Real Property;
(ii) Liens for taxes, assessments or governmental
charges or levies to the extent not past due or to the extent
contested, in good faith, by appropriate proceedings and for
which adequate reserves have been established;
(iii) Liens imposed by law, such as materialman's,
mechanic's, carrier's, workman's, and repairman's Liens and
other similar Liens arising in the ordinary course of business
which relate to obligations which are not overdue for a period
of more than 30 days or which are being contested in good
faith, by appropriate proceedings and for which adequate
reserves have been established;
(iv) pledges or deposits in the ordinary course of
business to secure nondelinquent obligations under xxxxxxx'x
compensation or unemployment laws or similar legislation or to
secure the performance of leases or contracts entered into in
the ordinary course of business or of public or nondelinquent
statutory obligations, bids, or appeal bonds;
(v) Liens upon or in any property acquired or held
by the Borrower or any of its Subsidiaries (other than the
Intercompany Creditor) to secure the purchase price or
construction costs (and, to the extent financed, sales and
excise taxes, delivery and installation costs and other
related expenses) of such property or to secure indebtedness
incurred solely for the purpose of financing or refinancing
the acquisition or construction of any such property to be
subject to such Liens, or Liens existing on any such property
at the time of acquisition, or extensions, renewals or
replacements of any of the foregoing for the same or a lesser
amount, provided that such Lien is established within thirty
days of the acquisition of said property or expenditure of
said construction costs, and provided, further, that no such
Lien shall extend to or cover any property other than the
property being acquired and no such extension, renewal or
replacement shall extend to or cover any property not
theretofore subject to the Lien being extended, renewed or
replaced, and provided, further, that the incurrence of any
19
25
Debt secured by the Liens permitted by this clause (v) shall
not exceed the amount then allowed under any of the covenants
set forth in Section 5.03;
(vi) zoning restrictions, easements, licenses,
landlord's liens or restrictions on the use of real property
owned or leased by the Borrower or any of its Subsidiaries,
which do not materially impair the use of such property in the
operation of the business of the Borrower or any of its
Subsidiaries or the value of such property for the purpose of
such business;
(vii) Liens on the property or assets of any
Subsidiary in favor of the Borrower or a Subsidiary, provided
that the holder and grantor of such Lien have each entered
into the Intercompany Subordination Agreement;
(viii) Liens listed on Schedule V; and
(ix) Liens not described in subclauses (i) through
(viii) above that relate to liabilities which are not in
excess of $10,000,000 in the aggregate.
"Person" means a individual, partnership, corporation
(including a business trust), joint stock company, trust,
unincorporated association, joint venture or other entity, or
a government or any political subdivision or agency or
instrumentality thereof.
"Plan" means a Single Employer Plan or a Multiple
Employer Plan.
"Process Agent" has the meaning set forth in Section
8.13(a).
"RCRA" means the Resource Conservation and Recovery
Act of 1976, as amended (42 U.S.C. ss. 6901 et seq.), and any
regulations promulgated thereunder.
"Real Property" means the real property of the
Borrower and its Subsidiaries located in the United States
described in Schedule I hereto, consisting of real property or
any interest in real property, including a leasehold interest
or an option to purchase, and all buildings, structures and
improvements now or hereafter located on all or any portion of
said real property, provided, that, notwithstanding the
foregoing, only leasehold interests of the Borrower and its
Subsidiaries which relate to the main clinic of any Facility
or for which the Borrower or any of its Subsidiaries incurs
Lease Expense equal to or in excess of $100,000 per year shall
be described in Schedule I.
"Register" has the meaning specified in Section
8.08(c).
"Related Business" means (i) a business that
principally operates (A) one or more independent practice
associations (each an "IPA") providing general organizational
structure and management to physician networks and related
management companies providing information and operating
systems, actuarial
20
26
and financial analysis, medical management and provider
contract services to the IPAs or (B) one or more management
service organizations (each a "MSO") providing IPAs with
practice management services, including billing, staffing and
financial management services, or (ii) a business (other than
a single-specialty clinic, or the assets thereof) related to
the operation of a Facility, IPA or MSO, the acquisition or
operation of which would not result in a material change in
the nature of the Borrower's business as of the date hereof. A
Related Business shall also include all real, personal and
mixed property relating thereto.
"Restricted Payment" of any Person, means any
dividend payment or other distribution of assets, properties,
cash, rights, obligations or securities on account of any
shares of any class of Securities of such Person, or any
purchase, redemption or other acquisition for value of any
shares of any class of Securities of such Person, or any
warrants, rights or options to acquire any such Securities,
now or hereafter outstanding; provided, however, that (i) any
dividend payment or other distribution payable in common stock
of such Person and (ii) any purchase, redemption or other
acquisition of shares of such Person's Securities or warrants,
rights or options to acquire any such Securities with the
proceeds received from the substantially concurrent issue of
new shares of such Person's Securities shall not be considered
a Restricted Payment.
"Revolver Termination Date" means June 29, 1998, or
the earlier date of termination in whole of the Commitments
pursuant to Section 2.04 or 6.01.
"Securities" means shares of capital stock of a
corporation (or similar property right in the case of
partnerships, limited liability companies and trusts).
"Senior Debt" means all Debt outstanding pursuant to
this Agreement and any other Debt of the Borrower and its
Subsidiaries not expressly subordinated on terms satisfactory
to the Majority Banks to the Debt outstanding under this
Agreement.
"Senior Debt/EBITDA Ratio" of any Person means, at
any date of determination, the ratio that (i) such Person's
total Senior Debt outstanding at such date of determination,
less the amount, if any, by which such Person's unrestricted
cash or cash equivalents exceed $15,000,000 at such date of
determination, bears to (ii) such Person's EBITDA.
"Service Agreement" means any of (i) the Service
Agreements listed on Schedule III and (ii) any similar
agreement entered into by the Borrower or any existing or
future Subsidiary of the Borrower or related professional
association or corporation after the Closing Date, in each
case as any of such agreements may from time to time be
amended, restated, supplemented or otherwise modified.
"Single-Employer Plan" means a single-employer plan,
as defined in Section 4001(a)(15) of ERISA, which (i) is
maintained for employees of the
21
27
Borrower or an ERISA Affiliate and no Person other than the
Borrower and its ERISA Affiliates or (ii) was so maintained
and in respect of which the Borrower or an ERISA Affiliate
could have liability under Section 4069 of ERISA in the event
such plan has been or were to be terminated.
"Solvent" means, with respect to any Person, that as
of any date of determination, (i) the then fair saleable value
of the assets of such Person is (a) greater than the then
total amount of liabilities (including contingent,
subordinated, matured and unliquidated liabilities) of such
Person and (b) greater than the amount that will be required
to pay such Person's probable liability on such Person's then
existing debts as they become absolute and matured, (ii) such
Person's capital is not unreasonably small in relation to its
business or any contemplated or undertaken transaction, and
(iii) such Person does not intend to incur, or believe or
reasonably should believe that it will incur, debts beyond its
ability to pay such debts as they become due.
"Stock Purchase Agreement" means any agreement
between the Borrower or any of its Subsidiaries and any Person
that operates a Facility or a Related Business relating to the
purchase by the Borrower or any of its Subsidiaries of all of
the Securities of such Person.
"Subordinated Debt" means any Debt of the Borrower
that is subordinated to the Debt of the Borrower under this
Agreement and the Notes on, and that otherwise contains, terms
and conditions satisfactory to the Majority Banks.
"Subordination Agreement" means a duly executed
subordination agreement in substantially the form of Exhibit
F, as amended, supplemented or otherwise modified from time to
time.
"Subsidiary" means, with respect to any Person, any
corporation, partnership, limited liability company, trust or
other Person of which more than 50% of the outstanding
Securities having ordinary voting power to elect a majority of
the board of directors of such corporation (or similar
governing body or Person with respect to partnerships, limited
liability companies and trusts) (irrespective of whether or
not at the time Securities of any other class or classes of
such Person shall or might have voting power upon the
occurrence of any contingency) is at the time directly or
indirectly owned by such Person, or one or more other
Subsidiaries of such Person, or by one or more other
Subsidiaries of such Person.
"Tangible Net Assets" of any Person, as at any date
of determination, means (without duplication) such Person's
cash, net Accounts, inventory, equipment, fixtures, real
property and the refundable portion of any prepaid expense
which, in accordance with generally accepted accounting
principles, are treated as tangible assets of such Person, in
each case (to the extent applicable),
22
28
less the sum of (i) Current Liabilities, (ii) cash held in a
sinking or other analogous fund established for the purpose of
redemption, retirement or prepayment of Securities or Debt,
and (iii) any write-up in the book value of such asset
resulting from a revaluation (but not a valuation of an asset
in connection with an acquisition subject to purchase
accounting treatment under generally accepted accounting
principles; provided that such valuation is accomplished in
accordance with such principles).
"Taxes" has the meaning set forth in Section 2.13(a).
"Total Assets" of any Person, as of the date of
determination, means all property, whether real, personal,
tangible, intangible or otherwise, which, in accordance with
generally accepted accounting principles, should be included
in determining total assets as shown on the assets portion of
a balance sheet of such Person.
"Total Capitalization" of any Person, as of the date
of determination, means the sum of such Person's Funded Debt
plus Net Worth.
"Total Consideration" means, with respect to the
acquisition of any Facility (or the assets thereof) or Related
Business, whether or not such acquisition is accomplished by
Securities purchase or asset purchase or by merger, the sum of
(i) all cash and non-cash consideration (including, without
limitation, assumed liabilities and equity consideration) paid
by the Borrower or any of its Subsidiaries at the closing of
such transaction, and (ii) all Deferred Acquisition
Consideration; provided that Total Consideration shall not
include any contingent payments that may be made by the
Borrower or any of its Subsidiaries after such closing.
"Total Liabilities" of any Person, as of the date of
determination, means all obligations, including, without
limitation, all Debt of such Person, which, in accordance with
generally accepted accounting principles, should be included
in determining total liabilities as shown on the liabilities
portion of a balance sheet of such Person, including all
Subordinated Debt other than, in the case of the Borrower and
its Subsidiaries, the Excluded Convertible Acquisition Debt.
"Unused Commitment" means, with respect to any Bank
at any time, (a) such Bank's Commitment at such time (as such
Commitment may be reduced pursuant to Section 2.04 or on
account of an Assignment and Acceptance entered into by such
Bank) minus (b) the aggregate principal amount of all
Committed Rate Advances made by such Bank outstanding at such
time.
"Welfare Plan" means a welfare plan, as defined in
Section 3(1) of ERISA, which section covers plans, funds and
programs providing (among other things) medical, surgical, or
hospital care or benefits, or benefits in the event of
sickness, accident, disability, death or unemployment,
together with plans which provide
23
29
workmen's compensation, unemployment compensation or
disability insurance benefits.
"Withdrawal Liability" has the meaning given such
term under Part I of Subtitle E of Title IV of ERISA.
SECTION 1.02. Computation of Time Periods. In this Agreement, in the
computation of a period of time from a specified date to a later specified date,
unless otherwise stated, the word "from" or "commencing" means "from and
including" and the word "to" or "until" means "to but excluding."
SECTION 1.03. Accounting Terms. All accounting terms not specifically
defined herein shall be construed in accordance with United States generally
accepted accounting principles consistent with those applied in the preparation
of the Borrower's December 31, 1996 Consolidated financial statements delivered
to the Banks prior to the date hereof.
ARTICLE II
AMOUNTS AND TERMS OF THE ADVANCES
SECTION 2.01. The Committed Rate Advances.
(a) Each Bank severally agrees, on the terms and conditions hereinafter
set forth, to make Committed Rate Advances to the Borrower from time to time on
any Business Day during the period from the Closing Date until the Revolver
Termination Date, in an amount for each such Advance not to exceed such Bank's
Unused Commitment on such Business Day; provided, however, that such Bank shall
not be obligated to make such Committed Rate Advance if, after giving effect to
such Committed Rate Advance and the other Committed Rate Advances to be made by
the other Banks as part of the same Borrowing, the then outstanding aggregate
principal amount of all Committed Rate Advances shall exceed the aggregate
Commitments of the Banks less the then outstanding aggregate principal amount of
all Competitive Bid Advances; provided further that, for the purposes of this
Section 2.01(a), such Bank's Unused Commitment shall be deemed to be reduced on
such Business Day by an amount equal to the product of (i) the then outstanding
principal amount of all Competitive Bid Advances and (ii) such Bank's Commitment
Percentage (the "Competitive Bid Reduction"). Each Committed Rate Borrowing
shall be in an aggregate amount of $3,000,000 or an integral multiple of
$1,000,000 in excess thereof, and shall consist of Advances made on the same day
by the Banks ratably according to their respective Commitments. Within the
limits of each Bank's Unused Commitment (as deemed reduced by the Competitive
Bid Reduction) in effect from time to time, the Borrower may borrow under this
Section 2.01(a), prepay pursuant to Section 2.09 and reborrow under this Section
2.01(a); provided that the Borrower may not borrow or reborrow under this
Section 2.01(a) while there are any Unused Commitments (as defined in the
$250,000,000 Credit Agreement) other than in respect of the then existing Letter
of Credit Liability (as defined in the $250,000,000 Credit Agreement).
24
30
(b) Each Committed Rate Borrowing shall be made on notice, given not
later than 11:00 A.M. (New York City time) (i) on the second Business Day prior
to the date of the proposed Borrowing, in the case of Eurodollar Rate Advances,
and (ii) on the date of the proposed Borrowing, in the case of Base Rate
Advances, by the Borrower to the Agent, which shall give each Bank prompt notice
thereof by telecopier, telex or cable. Each such notice of a Borrowing (a
"Notice of Borrowing") shall be by telecopier, telex or cable, confirmed
immediately in writing, in substantially the form of Exhibit B-1 hereto,
specifying therein (i) the requested date of such Borrowing, (ii) the requested
Type of Advances comprising such Borrowing, (iii) the requested aggregate amount
of such Borrowing, and (iv) in the case of a Borrowing comprised of Eurodollar
Rate Advances, the requested initial Interest Period for each such Advance. Each
Bank shall, before 12:00 noon (New York City time) on the date of such
Borrowing, make available for the account of its Applicable Lending Office to
the Agent at its address referred to in Section 8.02, in same day funds, such
Bank's ratable portion of such Borrowing. After the Agent's receipt of such
funds and upon fulfillment of the applicable conditions set forth in Article
III, the Agent will make such funds available to the Borrower at the Agent's
aforesaid address. Anything in this subsection (b) above to the contrary
notwithstanding, (A) the Borrower may not select Eurodollar Rate Advances for
any Committed Rate Borrowing if the obligation of the Banks to make Eurodollar
Rate Advances shall then be suspended pursuant to Section 2.11 and (B) no more
than eight Committed Rate Borrowings consisting of Eurodollar Rate Advances may
be outstanding at any one time.
(c) Each Notice of Borrowing shall be irrevocable and binding on the
Borrower. In the case of any Committed Rate Borrowing which the related Notice
of Borrowing specifies is to be comprised of Eurodollar Rate Advances, the
Borrower shall indemnify each Bank against any loss (including loss of
anticipated profits), cost or expense incurred by such Bank as a result of any
failure to fulfill on or before the date specified in such Notice of Borrowing
for such Borrowing the applicable conditions set forth in Article III,
including, without limitation, any loss, cost or expense incurred by reason of
the liquidation or reemployment of deposits or other funds acquired by such Bank
to fund the Advance to be made by such Bank as part of such Borrowing when such
Advance, as a result of such failure, is not made on such date.
(d) Unless the Agent shall have received notice from a Bank prior to
the date of any Committed Rate Borrowing that such Bank will not make available
to the Agent such Bank's ratable portion of such Borrowing, the Agent may assume
that such Bank has made such portion available to the Agent on the date of such
Borrowing in accordance with subsection (b) above and the Agent may, in reliance
upon such assumption, make available to the Borrower on such date a
corresponding amount. If and to the extent that such Bank shall not have so made
such ratable portion available to the Agent, such Bank and the Borrower
severally agree to repay to the Agent forthwith on demand such corresponding
amount together with interest thereon, for each day from the date such amount is
made available to the Borrower until the date such amount is repaid to the
Agent, at (i) in the case of the Borrower, the interest rate applicable at the
time to Advances comprising such Borrowing and (ii) in the case of such Bank,
the Federal Funds Rate. If such Bank shall repay to the Agent such corresponding
amount, such amount so repaid shall constitute such Bank's Advance as part of
such Borrowing for purposes of this Agreement. To
25
31
the extent that any Bank makes a payment of principal or interest to the Agent
pursuant to this subsection (d), the Borrower shall not be obligated to make
such payment.
(e) The failure of any Bank to make the Advance to be made by it as
part of any Committed Rate Borrowing shall not relieve any other Bank of its
obligation, if any, hereunder to make its Advance on the date of such Borrowing,
but no Bank shall be responsible for the failure of any other Bank to make the
Advance to be made by such other Bank on the date of any Committed Rate
Borrowing.
SECTION 2.02. The Competitive Bid Advances.
(a) Each Designated Bidder severally agrees, on the terms and
conditions hereinafter set forth, that the Borrower may avail itself of
Competitive Bid Advances from time to time on any Business Day during the period
from the Closing Date until 30 days prior to the Revolver Termination Date, in
the manner set forth in this Section 2.02; provided that the aggregate principal
amount of Competitive Bid Advances made on any Business Day may not exceed the
aggregate Unused Commitments of the Banks on such Business Day and the then
outstanding principal amount of any other Competitive Bid Advances; provided
further that Competitive Bid Advances may not be made while there are any Unused
Commitments (as defined in the $250,000,000 Credit Agreement) other than in
respect of the then existing Letter of Credit Liability (as defined in the
$250,000,000 Credit Agreement).
(b) The Borrower may request a Competitive Bid Borrowing by delivering
to the Agent, by telecopier, telex or cable, confirmed immediately in writing, a
request, in substantially the form of Exhibit B-2 (a "Competitive Bid Request"),
specifying therein (i) whether Fixed Rate Advances or LIBOR Advances are being
requested, (ii) the date (which shall be a Business Day) and aggregate amount of
the proposed Competitive Bid Borrowing, (iii) the maturity date for repayment of
the Competitive Bid Advances to be made as part of such Borrowing (which
maturity date shall be a date occurring (A) not less than seven days after the
date of such Borrowing in the case of a request for Fixed Rate Advances or 30
days after the date of such Borrowing in the case of a request for LIBOR
Advances, but (B) not later than the Revolver Termination Date), (iv) the
interest payment date or dates relating thereto, in the case of a request for
Fixed Rate Advances, and the applicable Interest Period, in the case of a
request for LIBOR Advances, and (v) any other terms to be applicable to such
Borrowing, not later than 11:00 A.M. (New York City time) at least (A) one
Business Day, in the case of a request for Fixed Rate Advances, or (B) four
Business Days, in the case of a request for LIBOR Advances, prior to the date of
the proposed Competitive Bid Borrowing. The Agent shall in turn promptly notify
each Designated Bidder of each request for such Competitive Bid Borrowing
received by it by sending such Designated Bidder a copy of the related
Competitive Bid Request.
(c) Each Designated Bidder may, if, in its sole discretion, it elects
to do so, irrevocably offer to make one or more Competitive Bid Advances to the
Borrower as part of such proposed Competitive Bid Borrowing at a rate or rates
of interest specified by such Designated Bidder in its sole discretion. Any such
offer (a "Competitive Bid") may be made by notifying the Agent (i) before 10:00
A.M. (New York City time) on the date of such proposed Competitive
26
32
Bid Borrowing, in the case of a request for Fixed Rate Advances, and (ii) before
10:00 A.M. (New York City time) on the third Business Day before the date of
such proposed Competitive Bid Borrowing, in the case of a request for LIBOR
Advances (the "Bid Due Date"), specifying the following:
(A) the amount of each Competitive Bid Borrowing which such
Designated Bidder would be willing to make as part of such proposed
Competitive Bid Borrowing (which amount may, subject to the proviso to
the first sentence of subsection (a) above, exceed a Bank's Commitment
but may not exceed the principal amount of the Competitive Bid Advances
of the Type and maturity requested by the Borrower);
(B) in the case of a request for a LIBOR Advance, the margin
above or below the applicable Eurodollar Rate (the "LIBOR Margin")
offered for such Competitive Bid Advance, expressed as a percentage
(rounded upwards, if necessary, to the nearest 1/16 of one percent) to
be added to or subtracted from the applicable Eurodollar Rate;
(C) in the case of a request for a Fixed Rate Advance, the
rate of interest per annum (rounded upwards, if necessary, to the
nearest 1/16 of one percent) (the "Fixed Rate") offered for such
Competitive Bid Advance; and
(D) the identity of the Designated Bidder submitting the
Competitive Bid;
provided that if the Agent in its capacity as a Designated Bidder shall, in its
sole discretion, elect to make any such Competitive Bid, it shall notify the
Borrower of such Competitive Bid before 9:30 A.M. (New York City time) on the
Bid Due Date. If any Designated Bidder shall elect not to make such a
Competitive Bid, such Designated Bidder shall so notify the Agent, before 10:00
A.M. (New York City time) on the Bid Due Date, and such Designated Bidder shall
not be obligated to, and shall not, make any Advance as part of such Competitive
Bid Borrowing; provided that the failure by any Designated Bidder to give such
notice shall not cause such Designated Bidder to be obligated to make any
Advance as part of such proposed Competitive Bid Borrowing. Unless otherwise
agreed by the Borrower and the Agent, no Competitive Bid shall contain
qualifying, conditional or similar language or propose terms other than or in
addition to those set forth in the Competitive Bid Request and, in particular,
no Competitive Bid may be conditioned upon acceptance by the Borrower of all (or
some specified minimum) of the principal amount of the Competitive Bid Advances
offered.
(d) The Agent shall, as promptly as practicable after the Competitive
Bid is submitted (but in any event not later than 10:15 A.M. (New York City
time) on the Bid Due Date), notify the Borrower of the terms (A) of any
Competitive Bid submitted that is in accordance with subsection (c) above and
(B) of any Competitive Bid that amends, modifies or is otherwise inconsistent
with a previous Competitive Bid with respect to the same Competitive Bid
Request. Any such subsequent Competitive Bid may be submitted solely to correct
a manifest error in such former Competitive Bid. The Agent's notice to the
Borrower shall specify (1) the aggregate principal amount of the Competitive Bid
Borrowing for which Competitive Bids have been received and (2) the respective
principal amounts and the Fixed Rates and LIBOR Margins, as
27
33
the case may be, so offered by each Designated Bidder (identifying the
Designated Bidder that made each Competitive Bid).
(e) The Borrower shall, in turn, before 11:00 A.M. (New York City time)
(i) on the day of the proposed Competitive Bid Borrowing, in the case of
requests for Fixed Rate Advances, or (ii) on the third Business Day prior to the
date of the proposed Competitive Bid Advances, in the case of a request for
LIBOR Advances, (or, in any such case, such other time and date as the Borrower
and the Agent, with the consent of the Majority Banks, may agree), either:
(i) cancel such Competitive Bid Borrowing by giving the Agent
notice to that effect, or
(ii) accept one or more of the Competitive Bids, in its sole
discretion, by giving notice to the Agent of the amount of each
Competitive Bid Advance to be made by each Designated Bidder as part of
such Competitive Bid Borrowing, and reject any remaining Competitive
Bids by giving the Agent notice to that effect; provided that (A) the
Borrower may only accept Competitive Bids in the order of the lowest to
the highest Fixed Rates or LIBOR Margins, as the case may be, offered,
(B) the Borrower may not accept Competitive Bids in excess of the
amount requested pursuant to subsection (b) above, or the amount
offered pursuant to subsection (c) above, for any maturity date or
Interest Period, and (C) if two or more Designated Bidders make
Competitive Bids at the same Fixed Rates or LIBOR Margins, as the case
may be, for the same maturity date or Interest Period, the Borrower may
only accept such Competitive Bids in proportion (as nearly as possible)
to the amounts which such Designated Bidders offered at such rate for
such maturity or Interest Period (in amounts of not less than
$1,000,000 or an integral multiple of $100,000 in excess thereof).
(f) If the Borrower notifies the Agent that such Competitive Bid
Borrowing is canceled pursuant to subsection (d)(i) above, the Agent shall give
prompt notice thereof to the Designated Bidders, and such Competitive Bid
Borrowing shall not be made.
(g) If the Borrower accepts one or more of the Competitive Bids made by
any Designated Bidder or Designated Bidders pursuant to subsection (d)(ii)
above, the Agent shall in turn promptly notify (A) each Designated Bidder that
has made a Competitive Bid as described in subsection (c) above, of the date and
aggregate amount of such Competitive Bid Borrowing and whether or not any
Competitive Bid or Bids made by such Designated Bidder pursuant to subsection
(c) above have been accepted by the Borrower, (B) each Designated Bidder that is
to make an Advance as part of such Competitive Bid Borrowing, of the amount of
each Advance to be made by such Bank as part of such Borrowing, and (C) each
Designated Bidder that is to make an Advance as part of such Competitive Bid
Borrowing, as to whether such Competitive Bid Borrowing conforms of the
requirements of Section 2.02. Each Designated Bidder that is to make an Advance
as part of such Competitive Bid Borrowing shall, before 11:30 A.M. (New York
City time) on the date of such Competitive Bid Borrowing specified in the notice
received from the Agent pursuant to clause (A) of the preceding sentence
(provided such Designated
28
34
Bidder shall have received a Competitive Bid Note and a favorable notice from
the Agent pursuant to clause (C) of the preceding sentence), make available to
the Agent at its address referred to in Section 8.02, in same day funds, such
Designated Bidder's portion of such Competitive Bid Borrowing. Upon fulfillment
of the applicable conditions set forth in Article III and after receipt by the
Agent of such funds, the Agent will make such funds available to the Borrower at
the Agent's aforesaid address. Promptly after each Competitive Bid Borrowing,
the Agent shall notify each Bank of the amount of the Competitive Bid Borrowing,
the consequent Competitive Bid Reduction and the dates upon which such
Competitive Bid Reduction commenced and will terminate.
(h) Each Competitive Bid Borrowing shall be in an aggregate amount not
less than $3,000,000 or an integral multiple of $1,000,000 in excess thereof
and, following the making of such Competitive Bid Borrowing, the Borrower shall
be in compliance with the limitations set forth in the proviso to the first
sentence of subsection (a) above.
(i) Each acceptance by Borrower pursuant to subsection (g) above shall
be irrevocable and binding on the Borrower. In the case of any acceptance of a
Competitive Bid for LIBOR Advances, the Borrower shall indemnify each Designated
Bidder against any loss (including loss of anticipated profits), cost or expense
incurred by such Designated Bidder as a result of any failure to fulfill on or
before the date specified pursuant to subsection (g) above for such Competitive
Bid Borrowing the applicable conditions set forth in Article III, including,
without limitation, any loss, cost or expense incurred by reason of the
liquidation or reemployment of deposits or other funds acquired by such
Designated Bidder to fund the LIBOR Advance to be made by such Bank as part of
such Borrowing when such Advance, as a result of such failure, is not made on
such date.
(j) The failure of any Designated Bidder to make the Advance to be made
by it as part of any Competitive Bid Borrowing shall not relieve any other
Designated Bidder of its obligation, if any, hereunder to make its Advance on
the date of such Borrowing, but no Designated Bidder shall be responsible for
the failure of any other Designated Bidder to make the Advance to be made by
such other Designated Bidder on the date of any Competitive Bid Borrowing.
(k) Within the limits and on the conditions set forth in this Section
2.02, the Borrower may from time to time borrow under this Section 2.02, repay
pursuant to Section 2.05 and reborrow under this Section 2.02; provided that not
more than ten Competitive Bid Borrowings may be outstanding at any time (for
which purpose Competitive Bid Advances made on the same date, but having
different maturities or representing Borrowings under different Commitments,
shall be deemed to be separate Competitive Bid Borrowings).
SECTION 2.03. Fees.
(a) Facility Fees. The Borrower agrees to pay to the Agent, for the
account of each of the Banks, a facility fee on the average daily Commitment of
such Bank from the Closing Date until the Revolver Termination Date at the
Applicable Facility Fee Rate from time to time in
29
35
effect, payable quarterly in arrears on the last day of September and December
1997 and March 1998 and on the Revolver Termination Date.
(b) Agency, Auction and Arrangement Fees. The Borrower agrees to pay to
the Agent, for its own account, the agency fees and the auction fees and to an
Affiliate of the Agent, the arrangement fee, in such amounts and on such dates
as are specified in the letter agreement dated as of June 2, 1997, between the
Borrower and the Agent.
SECTION 2.04. Optional Reduction of the Commitments. The Borrower shall
have the right, upon at least three Business Days' notice to the Agent,
permanently to terminate in whole or reduce ratably in part the Unused
Commitments; provided that (a) each partial reduction shall be in the aggregate
amount of $3,000,000 or an integral $1,000,000 multiple in excess thereof, (b)
each reduction shall be made ratably among the Banks in accordance with their
Unused Commitments, and (c) no reduction may reduce the aggregate Commitments of
the Banks below the aggregate amount of the then outstanding principal amount of
the Competitive Bid Advances.
SECTION 2.05. Repayment.
(a) The Borrower shall repay on the Revolver Termination Date the
aggregate principal amount of the Committed Rate Advances of each Bank
outstanding on the Revolver Termination Date, together with accrued interest
thereon.
(b) The Borrower shall repay the aggregate principal amount of the
Competitive Bid Advances of each Designated Bidder, together with accrued
interest thereon, in such amounts and on such dates as specified pursuant to
Section 2.02(b).
SECTION 2.06. Interest.
(a) The Borrower shall pay interest on the unpaid principal amount of
each Committed Rate Advance made by each Bank from the date of such Advance
until such principal amount shall be paid in full, at the following rates per
annum:
(i) Base Rate Advances. During such periods as such Advance is a
Base Rate Advance, a rate per annum equal at all times to the sum
of the Base Rate in effect from time to time, payable quarterly in
arrears on the last day of each March, June, September and December
during such periods and on the date such Base Rate Advance shall be
Converted or paid in full. Notwithstanding the foregoing, during the
continuance of an Event of Default, the principal amount of each Base
Rate Advance shall bear interest, to the fullest extent permitted by
law, from the date on which such amount is due until such amount is
paid in full, payable on demand, at a fluctuating rate per annum equal
at all times to 2% per annum above the Base Rate in effect from time to
time.
(ii) Eurodollar Rate Advances. During such periods as such Advance
is a Eurodollar Rate Advance, a rate per annum equal at all times
during the Interest Period for such Advance to the sum of the
Eurodollar Rate for such Interest Period plus the Applicable Eurodollar
Rate Margin, payable on the last day of such Interest Period and, if
30
36
such Interest Period has a duration of six months, on the day that
occurs during such Interest Period three months from the first day of
such Interest Period; provided, however, that in the event that the
Applicable Eurodollar Rate Margin for any fiscal quarter of the
Borrower has not yet been determined in accordance with the provisions
of the definition of Applicable Eurodollar Rate Margin in Section 1.01
as of the time when interest on a Eurodollar Rate Advance becomes due,
the Borrower shall pay such interest on the date when due based on the
then existing Applicable Eurodollar Rate Margin and any necessary
subsequent adjustments in the amount of interest payable hereunder (due
to any subsequent change in the Applicable Eurodollar Rate Margin)
shall be made on the first date on which any interest on any Committed
Rate Advance is payable after the date of determination of the
Applicable Eurodollar Rate Margin. Notwithstanding the foregoing,
during the continuance of an Event of Default, the principal amount of
each Eurodollar Rate Advance shall bear interest, to the fullest extent
permitted by law, from the date on which such amount is due until such
amount is paid in full, payable on demand, at a rate per annum equal at
all times to 2% per annum above the Eurodollar Rate plus the Applicable
Eurodollar Rate Margin until the end of the Interest Period applicable
to such Eurodollar Rate Advance, at which time the rate per annum shall
become 2% per annum above the Base Rate, in each case as in effect from
time to time.
(b) The Borrower shall pay interest on the unpaid principal amount of
each Competitive Bid Advance from the date of such Advance until such principal
amount shall be paid in full, at the rate of interest for such Advance specified
by the Designated Bidder making such Advance in its Competitive Bid with respect
thereto delivered pursuant to Section 2.02(c), payable on the interest payment
date or dates specified by the Borrower for such Advance in the related
Competitive Bid Request delivered pursuant to Section 2.02(b) and on the
maturity date of such Competitive Bid Advance. Notwithstanding the foregoing,
during the continuance of an Event of Default, the principal amount of each
Competitive Bid Advance shall bear interest, to the fullest extent permitted by
law, from the date on which such amount is due until such amount is paid in
full, payable on demand, at a rate equal to 2% per annum above the interest rate
specified by the Designated Bidder that made such Advance in its Competitive Bid
with respect thereto delivered pursuant to Section 2.02(c).
SECTION 2.07. Interest Rate Determination and Protection.
(a) The Agent shall give prompt notice to the Borrower and the Banks of
the applicable interest rate under Section 2.06(a)(i) or (ii).
(b) If, with respect to any Eurodollar Rate Advance, the Majority Banks
notify the Agent that the Eurodollar Rate for any Interest Period for such
Advance will not adequately reflect the cost to such Majority Banks of making,
funding or maintaining their respective Eurodollar Rate Advance for such
Interest Period, the Agent shall forthwith so notify the Borrower and the Banks,
whereupon:
(i) each Eurodollar Rate Advance will automatically, on the last
day of the then existing Interest Period therefor, Convert into a
Base Rate Advance, and
31
37
(ii) the obligation of the Banks to make, or to Convert Advances
into, Eurodollar Rate Advances shall be suspended until the Agent
shall notify the Borrower and the Banks that the circumstances causing
such suspension no longer exist.
(c) If the Borrower shall fail to select the duration of any Interest
Period for any Eurodollar Rate Advance in accordance with the provisions
contained in the definition of "Interest Period" in Section 1.01, the Agent will
forthwith so notify the Borrower and the Banks and such Advance will
automatically, on the last day of the then existing Interest Period therefor,
Convert into Base Rate Advances.
SECTION 2.08. Voluntary and Automatic Conversion of Committed Rate
Advances.
(a) The Borrower may on any Business Day, upon notice given to the
Agent not later than 11:00 A.M. (New York City time) on the second Business Day
prior to the date of the proposed Conversion and subject to the provisions of
Sections 2.07 and 2.11, Convert all Committed Rate Advances of one Type
comprising the same Borrowing into Committed Rate Advances of another Type;
provided, however, that any Conversion of any Eurodollar Rate Advances into Base
Rate Advances shall be made on, and only on, the last day of an Interest Period
for such Eurodollar Rate Advances. Each such notice of Conversion shall, within
the restrictions specified above, specify (i) the date of such Conversion, (ii)
the Advances to be Converted, and (iii) if such Conversion is into Eurodollar
Rate Advances, the duration of the Interest Period for each such Advance.
(b) On the date on which the unpaid aggregate principal amount of
Eurodollar Rate Advances comprising any Committed Rate Borrowing shall be
reduced, by payment or prepayment or otherwise, to less than $3,000,000, the
Eurodollar Rate Advances comprising such Borrowing shall automatically Convert
into Base Rate Advances, and on and after such date the Borrower may not convert
such Base Rate Advances to Eurodollar Rate Advances until such time as the
aggregate principal amount of Base Rate Advances equals or exceeds $3,000,000.
SECTION 2.09. Prepayments.
(a) Voluntary Prepayments. The Borrower may, upon at least (i) in the
case of Eurodollar Rate Advances, two Business Days' and (ii) in the case of
Base Rate Advances, the same Business Day's notice to the Agent stating the
proposed date and aggregate principal amount of the prepayment, and if such
notice is given, the Borrower shall, prepay the outstanding principal amounts of
the Advances comprising part of the same Committed Rate Borrowing in whole or
ratably in part, together with accrued interest to the date of such prepayment
on the principal amount prepaid and, in the case of Eurodollar Rate Advances,
any amounts payable under Section 8.04(b); provided, however, that each partial
prepayment shall be in an aggregate principal amount not less than $3,000,000 or
any integral multiple of $1,000,000 in excess thereof. The Borrower may not
prepay any Competitive Bid Advances.
(b) Asset Sales Mandatory Prepayments. Subject to Section 2.09(f), upon
the sale, lease or other disposition by the Borrower or any Subsidiary of the
Borrower of assets of the Borrower and its Subsidiaries constituting more than
5% of the Consolidated Total Assets of the
32
38
Borrower and its Subsidiaries at the time of sale, lease or other disposition,
then (x) the Net Cash Proceeds of such sale, lease or other disposition shall be
delivered as soon as practicable to the Agent and (y) any deferred cash proceeds
of such sale, lease, or other disposition shall be delivered to the Agent as
soon as practicable after their receipt (at which time the same shall become Net
Cash Proceeds). Any such Net Cash Proceeds shall be applied in accordance with
Section 2.09(e).
(c) Subordinated Debt Issuance Mandatory Prepayments. Subject to
Section 2.09(f), upon the issuance, if permitted in writing by the Majority
Banks, by the Borrower or any of its Subsidiaries of any Subordinated Debt,
whether or not convertible into or exchangeable for Securities (other than the
subordinated convertible notes issued by the Borrower or any of its Subsidiaries
as consideration for the acquisition of Facilities (or the assets thereof), any
Existing Clinic Acquisitions or the acquisition of Related Businesses), then (x)
75% of the Net Cash Proceeds of such issuance shall be delivered as soon as
practicable to the Agent and (y) 75% of any deferred cash proceeds of such
issuance shall be delivered to the Agent as soon as practicable after their
receipt (at which time the same shall become Net Cash Proceeds). Any such Net
Cash Proceeds shall be applied in accordance with Section 2.09(e).
(d) Securities Issuance Mandatory Prepayment. Subject to Section
2.09(f), upon the sale or issuance by the Borrower or any of its Subsidiaries of
any Securities, any securities convertible into or exchangeable for Securities
(other than Subordinated Debt subject to Section 2.09(c)), or any warrants,
rights or options to acquire Securities to any Person other than the Borrower or
any of its Subsidiaries other than such sale or issuance pursuant to the
Borrower's employee stock purchase plans or employee and director stock option
plans or similar plan available to physicians practicing at a Facility or
Related Business and other than the issuance of Securities as consideration for,
or the proceeds of which are within 180 days after receipt used for, or the
issuance of subordinated convertible notes as consideration for, the acquisition
of any Facility (or the assets thereof) or any Existing Clinic Acquisitions or
the acquisition of any Related Businesses to the extent such acquisition
satisfies all the requirements of Section 5.02(f)(i) or (ii), as the case may
be), then (x) 50% of the Net Cash Proceeds of such sale or issuance shall be
delivered as soon as practicable to the Agent and (y) 50% of any deferred cash
proceeds of such sale or issuance shall be delivered to the Agent as soon as
practicable after their receipt (at which time the same shall become Net Cash
Proceeds). Any such Net Cash Proceeds shall be applied in accordance with
Section 2.09(e).
(e) Application of Prepayments. Mandatory prepayments pursuant to
Section 2.09(b), (c) or (d) shall be: first, applied to the payment of any
amount then owing to the Agent or any Bank pursuant to Section 8.04(a); second,
applied to the ratable payment of outstanding Committed Rate Advances, together
with accrued interest to the date of such payment on the principal amount repaid
and any amounts payable pursuant to Section 8.04(b) in respect thereof; and
third, delivered to the Agent to be held as pledged collateral to be applied to
the ratable payment when due of outstanding Competitive Bid Advances, together
with accrued interest to the date of such payment on the principal amount
repaid, to the extent of the aggregate amount of such principal and interest.
33
39
(f) Effect of Investment Grade Rating. Notwithstanding Sections
2.09(b), (c), (d) or (e), no prepayment shall be required by any of such
sections if at the time of the sale, lease or other disposition, issuance or
sale referred to therein any of the then outstanding Debt of the Borrower shall
then be rated Investment Grade.
SECTION 2.10. Increased Costs.
(a) If, due to either (i) the introduction of or any change (other than
any change by way of imposition or increase of reserve requirements, in the case
of Eurodollar Rate Advances or LIBOR Advances, included in the Eurodollar Rate
Reserve Percentage) in or in the interpretation of any law or regulation or (ii)
the compliance with any guideline or request from any central bank or other
governmental authority (whether or not having the force of law), there shall be
any increase in the cost to any Bank of agreeing to make or making, funding or
maintaining Eurodollar Rate Advances or LIBOR Advances, then the Borrower shall
from time to time, upon demand by such Bank (with a copy of such demand to the
Agent), pay to the Agent for the account of such Bank additional amounts
sufficient to compensate such Bank for such increased cost. A certificate as to
the amount of such increased cost, submitted to the Borrower and the Agent by
such Bank, shall be conclusive and binding for all purposes, absent manifest
error.
(b) If any Bank determines that compliance with any law or regulation
or any guideline or request from any central bank or other governmental
authority (whether or not having the force of law) affects or would affect the
amount of capital (or the rate of return on capital) required or expected to be
maintained by such Bank or any corporation controlling such Bank and that the
amount of such capital is increased (or such rate of return is reduced) by or
based upon the existence of such Bank's commitment, or offer or agreement, to
lend hereunder and other commitments, or offers or agreements, of this type,
then, upon notice by such Bank (with a copy of such notice to the Agent), the
Borrower shall immediately pay to the Agent for the account of such Bank, from
time to time as specified by such Bank, additional amounts sufficient to
compensate such Bank or such corporation in the light of such circumstances, to
the extent that such Bank reasonably determines such increase in capital (or
reduction in rate of return) to be allocable to the existence of such Bank's
commitment, or offer or agreement, to lend hereunder. Such notice as to such
amounts submitted and delivered to the Borrower and the Agent by such Bank shall
set forth in summary fashion the basis of such allocation and shall be
conclusive and binding for all purposes, absent manifest error.
SECTION 2.11. Illegality. Notwithstanding any other provision of this
Agreement, if any Bank shall notify the Agent that the introduction of or any
change in or in the interpretation of any law or regulation makes it unlawful,
or any central bank or other governmental authority asserts that it is unlawful,
for any Bank or its Eurodollar Lending Office to perform its obligations or
agreements hereunder to make Eurodollar Rate Advances or LIBOR Advances or to
fund or maintain Eurodollar Rate Advances or LIBOR Advances hereunder: (a) in
the case of Eurodollar Rate Advances, (i) the obligation of the Banks to make,
or to Convert Advances into, Eurodollar Rate Advances shall be suspended until
the Agent shall notify the Borrower and the Banks that the circumstances causing
such suspension no longer exist and (ii) the Borrower shall
34
40
forthwith prepay in full all Eurodollar Rate Advances of all Banks then
outstanding, together with interest accrued thereon and any costs payable
pursuant to Section 8.04(b), unless the Borrower, within five Business Days of
notice from the Agent, Converts all Eurodollar Rate Advances of all Banks then
outstanding into Base Rate Advances in accordance with Section 2.08, and (b) in
the case of LIBOR Advances, such Bank shall no longer be obligated to fund any
LIBOR Advance it has agreed to fund thereafter.
SECTION 2.12. Payments and Computations.
(a) The Borrower shall make each payment hereunder and under the Notes
not later than 11:00 A.M. (New York City time) on the day when due free and
clear of any taxes, offset or other charge in United States dollars to the Agent
at its address referred to in Section 8.02 in same day funds. The Agent will
promptly thereafter cause to be distributed like funds relating to the payment
of principal or interest or facility fees (i) ratably (other than amounts
payable pursuant to Section 2.10, 2.13 or 8.04) to the Banks for the account of
their respective Applicable Lending Offices, in the case of Committed Rate
Advances, and to the applicable Designated Bidder (for the account of its
Applicable Lending Office), in the case of Competitive Bid Advances, and like
funds relating to the payment of any other amount payable to any Bank to such
Bank for the account of its Applicable Lending Office, in each case to be
applied in accordance with the terms of this Agreement. Upon its acceptance of
an Assignment and Acceptance and recording of the information contained therein
in the Register pursuant to Section 8.08(d), from and after the effective date
specified in such Assignment and Acceptance, the Agent shall make all payments
hereunder in respect of the interest assigned thereby to the Bank assignee
thereunder, and the parties to such Assignment and Acceptance shall make all
appropriate adjustments in such payments for periods prior to such effective
date directly between themselves.
(b) The Borrower hereby authorizes each Bank, if and to the extent
payment owed to such Bank is not made when due hereunder or under the Note held
by such Bank, to charge from time to time against any or all of the Borrower's
accounts with such Bank any amount so due.
(c) All computations of interest (other than interest on Base Rate
Advances) and of fees shall be made on the basis of a year of 360 days, and all
computations of interest on Base Rate Advances shall be made on the basis of a
year of 365 or 366 days (as the case may be), in each case for the actual number
of days (including the first day but excluding the last day) occurring in the
period for which such interest or fees are payable. Each determination by the
Agent of an interest rate or fee hereunder shall be conclusive and binding for
all purposes, absent manifest error.
(d) Whenever any payment hereunder or under the Notes shall be stated
to be due on a day other than a Business Day, such payment shall be made on the
next succeeding Business Day, and such extension of time shall in such case be
included in the computation of payment of interest or facility fee, as the case
may be; provided, however, if such extension would cause payment of interest on
or principal of Eurodollar Rate Advances or LIBOR Advances to be made
35
41
in the next following calendar month, such payment shall be made on the next
preceding Business Day.
(e) Unless the Agent shall have received notice from the Borrower prior
to the date on which any payment is due to the Banks hereunder in respect of
Committed Rate Advances that the Borrower will not make such payment in full,
the Agent may assume that the Borrower has made such payment in full to the
Agent on such date and the Agent may, in reliance upon such assumption, cause to
be distributed to each Bank on such due date an amount equal to the amount then
due such Bank. If and to the extent the Borrower shall not have so made such
payment in full to the Agent, each Bank shall repay to the Agent forthwith on
demand such amount distributed to such Bank together with interest thereon, for
each day from the date such amount is distributed to such Bank until the date
such Bank repays such amount to the Agent, at the Federal Funds Rate.
(f) Notwithstanding any provision in this Agreement or any other Loan
Document to the contrary, all payments received by the Agent under the other
Loan Documents, the application of which are not provided for in such Loan
Documents, may be then or at any time thereafter be applied in whole or in part
by the Agent for the ratable benefit of the Banks (except in the case of
Competitive Bid Advances), against all or part of the Advances or other
obligations of the Borrower hereunder or under the other Loan Documents, in such
order and manner as the Agent shall elect.
SECTION 2.13. Taxes.
(a) Any and all payments by the Borrower hereunder or under the Notes
shall be made, in accordance with Section 2.12, free and clear of and without
deduction for any and all present or future taxes, levies, imposts, deductions,
charges or withholdings, and all liabilities with respect thereto, excluding, in
the case of each Bank and the Agent, taxes imposed on its income, and franchise
taxes imposed on it, by the jurisdiction under the laws of which such Bank or
the Agent (as the case may be) is organized or any political subdivision thereof
and, in the case of each Bank, taxes imposed on its income, and franchise taxes
imposed on it, by the jurisdiction of such Bank's Applicable Lending Office or
any political subdivision thereof (all such non-excluded taxes, levies, imposts,
deductions, charges, withholdings and liabilities being hereinafter referred to
as "Taxes"). If the Borrower shall be required by law to deduct any Taxes from
or in respect of any sum payable hereunder or under any Note to any Bank or the
Agent, (i) the sum payable shall be increased as may be necessary so that after
making all required deductions (including deductions applicable to additional
sums payable under this Section 2.13) such Bank or the Agent (as the case may
be) receives an amount equal to the sum it would have received had no such
deductions been made, (ii) the Borrower shall make such deductions and (iii) the
Borrower shall pay the full amount deducted to the relevant taxation authority
or other authority in accordance with applicable law.
(b) In addition, the Borrower agrees to pay any present or future stamp
or documentary taxes or any other excise or property taxes, charges or similar
levies which arise from any payment made hereunder or under the Notes or from
the execution, delivery or
36
42
registration of, or otherwise with respect to, this Agreement or the Notes
(hereinafter referred to as "Other Taxes").
(c) The Borrower will indemnify each Bank and the Agent for the full
amount of Taxes or Other Taxes (including, without limitation, any Taxes or
Other Taxes imposed by any jurisdiction on amounts payable under this Section
2.13) paid by such Bank or the Agent (as the case may be) and any liability
(including penalties, interest and expenses) arising therefrom or with respect
thereto, whether or not such Taxes or Other Taxes were correctly or legally
asserted. This indemnification shall be made within 30 days from the date such
Bank or the Agent (as the case may be) makes written demand therefor.
(d) Within 30 days after the date of any payment of Taxes, the Borrower
will furnish to the Agent, at its address referred to in Section 8.02, the
original or a certified copy of a receipt evidencing payment thereof.
(e) Without prejudice to the survival of any other agreement of the
Borrower hereunder, the agreements and obligations of the Borrower contained in
this Section 2.13 shall survive the payment in full of principal and interest
hereunder and under the Notes.
(f) Prior to the date of the first Borrowing under this Agreement in
the case of each Bank party hereto on the date hereof, on the date of the
effectiveness of the Assignment and Acceptance pursuant to which it became a
Bank in the case of each other Bank, and within 30 days following the first day
of each calendar year or if otherwise requested from time to time by the
Borrower or the Agent, each Bank organized under the laws of a jurisdiction
outside the United States shall provide the Agent and the Borrower with two
counterparts of each of the forms prescribed by the Internal Revenue Service
(Form 1001 or 4224, or successor form(s), as the case may be, or another
appropriate form) of the United States certifying as to such Bank's status for
purposes of determining exemption from United States withholding taxes with
respect to all payments to be made to such Bank under any Loan Document. Unless
the Borrower and the Agent have received such forms or other documents
satisfactory to them indicating that payments under any Loan Document are not
subject to United States withholding tax, the Borrower or the Agent (if not
withheld by the Borrower) shall withhold taxes from such payments at the
applicable statutory rate, without any obligation to "gross-up" or make such
Bank or the Agent whole under Section 2.13(a); provided, however, that the
Borrower shall have the obligation to make such Bank or the Agent whole and to
"gross-up" under Section 2.13(a), if the failure to so deliver such forms or
make such statements (other than the forms and statements required to be
delivered on or made prior to the date of the initial Borrowing, on the date of
the Assignment and Acceptance pursuant to which an Eligible Assignee became a
Bank) is the result of the occurrence of an event (including, without
limitation, any change in treaty, law or regulation) which (alone or in
conjunction with other events) renders such forms inapplicable, that would
prevent such Bank or the Agent from making the statements contemplated by such
forms or which removes or reduces an exemption (whether partial or complete)
from withholding tax previously available to such Bank or the Agent. Each Bank
(and the Agent, if applicable) will promptly notify the Borrower of the
occurrence (when known to it) of an event contemplated by the foregoing proviso.
37
43
SECTION 2.14. Sharing of Payments. Etc. If any Bank shall obtain any
payment (whether voluntary, involuntary, through the exercise of any right of
set-off, or otherwise) on account of any Committed Rate Advances made by it
(other than pursuant to Section 2.10, 2.13 or 8.04) in excess of its ratable
share of payments on account of such Committed Rate Advances obtained by all the
Banks, such Bank shall forthwith purchase from the other Banks such
participations in such Committed Rate Advances made by them as shall be
necessary to cause such purchasing Bank to share the excess payment ratably with
each of them; provided, however, that if all or any portion of such excess
payment is thereafter recovered from such purchasing Bank, such purchase from
each Bank shall be rescinded and such Bank shall repay to the purchasing Bank
the purchase price to the extent of such recovery together with an amount equal
to such Bank's ratable share (according to the proportion of (i) the amount of
such Bank's required repayment to (ii) the total amount so recovered from the
purchasing Bank) of any interest or other amount paid or payable by the
purchasing Bank in respect of the total amount so recovered. The Borrower agrees
that any Bank so purchasing a participation from another Bank pursuant to this
Section 2.14 may, to the fullest extent permitted by law, exercise all its
rights of payment (including the right of set-off) with respect to such
participation as fully as if such Bank were the direct creditor of the Borrower
in the amount of such participation.
SECTION 2.15. Evidence of Debt/Register.
(a) The Debt of the Borrower resulting from the Committed Rate Advances
and Competitive Bid Advances shall be evidenced by the Committed Rate Notes and
the Competitive Bid Notes, respectively, delivered to the Banks pursuant to
Article III, and the remaining principal amount thereof shall be recorded by the
Banks, and, prior to any transfer, endorsed on the grids thereto in accordance
with the terms of the Notes. The Agent shall also maintain in accordance with
its usual practice an account or accounts evidencing the indebtedness of the
Borrower under this Agreement and the amounts of principal and interest payable
and paid to each Bank from time to time under this Agreement.
(b) The Register maintained by the Agent pursuant to Section 8.08(c)
shall include a control account, and a subsidiary account for each Bank, in
which accounts (taken together) shall be recorded: (i) the date and amount of
each Borrowing, the Commitment to which such Borrowing relates, the Type of
Advance comprising such Borrowing and the Interest Period applicable thereto (if
any) from time to time, (ii) the terms of each Assignment and Acceptance
delivered to and accepted by it, (iii) the amount of any principal or interest
due and payable or to become due and payable from the Borrower to each Bank, and
(iv) the amount of any sum received by the Agent from the Borrower hereunder and
each Bank's share thereof.
SECTION 2.16. Use of Proceeds. The proceeds of the Advances shall be
used by the Borrower for Capital Investments (to the extent permitted under this
Agreement), including, without limitation, acquisitions of Facilities and
Related Businesses (to the extent permitted under this Agreement), and other
general corporate purposes.
38
44
SECTION 2.17. Existing Credit Agreement B Advances; Existing
Collateral
(a) Existing Credit Agreement B Advances, Termination of B Commitment
Under Existing Credit Agreement. On the Closing Date: (i) there shall be no
outstanding B Advances (as defined in the Existing Credit Agreement) and (ii)
the B Commitments (as such term is defined in the Existing Credit Agreement)
shall be permanently terminated in full.
(b) Release of Collateral. On the Closing Date, all Liens on the
Collateral (as defined in the Existing Credit Agreement) shall be released and
terminated, and from and after the Closing Date, the Agent shall execute and
deliver, at the Borrower's expense, such termination statements and other
documents as the Borrower may reasonably request to evidence the release and
termination of such Liens.
ARTICLE III
CONDITIONS OF LENDING
SECTION 3.01. Conditions Precedent to Any Borrowing. The obligation of
each Bank to make an Advance on the occasion of any Borrowing shall be subject
to the conditions precedent that on the date of such Borrowing (a) the following
statements shall be true and the Agent shall have received a certificate signed
by a duly authorized officer of the Borrower, dated the date of such Borrowing,
stating that such statements are true (and each of the giving of the applicable
Notice of Borrowing and the acceptance by the Borrower of the proceeds of such
Borrowing shall constitute a representation and warranty by the Borrower and
each Loan Party (as to each Loan Document to which it is a party) that on the
date of such Borrowing such statements are true):
(i) the representations and warranties contained in Section
4.01 of this Agreement, in Section 6 of the Guaranty, and in Section 11
of the Intercompany Subordination Agreement, are correct on and as of
the date of such Borrowing, before and after giving effect to such
Borrowing and to the application of the proceeds therefrom, as though
made on and as of such date; and
(ii) no event has occurred and is continuing, or would result
from such Borrowing or from the application of the proceeds therefrom,
which constitutes an Event of Default or would constitute an Event of
Default but for the requirement that notice be given or time elapse or
both;
and (b) the Competitive Bid Note, duly executed by the Borrower, to the order of
the appropriate Designated Bidder, shall have been received by the Agent, and
(c) the Agent shall have received such other approvals, opinions or documents as
the Agent may reasonably request.
SECTION 3.02. Conditions Precedent to Initial Advances. The obligation
of each Bank to make its initial Advance is subject to the following conditions
precedent:
(i) The Agent shall have received evidence satisfactory to it
that all fees and expenses payable by the Borrower under the Existing
Loan Agreement shall have been paid in full.
39
45
(ii) The Agent shall have received the following
documents, each dated the Closing Date and in form and substance
satisfactory to the Agent and (with respect to the Guaranty and the
Intercompany Subordination Agreement) in sufficient copies for each
Bank:
(a) The Committed Rate Notes, each duly executed by
the Borrower, to the order of the appropriate Banks.
(b) The Guaranty, duly executed by each Guarantor.
(c) The Intercompany Subordination Agreement, duly
executed by each Loan Party.
(d) Certified copies of the (i) resolutions of the
Board of Directors or other governing body of each Loan Party
approving each Loan Document to which it is a party, and of
all documents evidencing other necessary corporate, limited
liability company or partnership action and governmental
approvals, if any, with respect to each such Loan Document,
(ii) all documents evidencing other corporate, limited
liability company or partnership action or governmental
approvals, if any, necessary or, in the reasonable opinion of
the Agent, advisable in connection with the execution,
delivery and performance of each Loan Document; (iii) the
certificate or articles of incorporation, by-laws or other
constituent instruments of the Borrower and of each of its
Subsidiaries other than Immaterial Subsidiaries, as amended
through the Closing Date or, with respect to any of the
Borrower's Subsidiaries other than Immaterial Subsidiaries, a
certification that such Subsidiary's certificate or articles
of incorporation, bylaws or other constituent instruments
delivered to Citibank in connection with the Existing Credit
Agreement are true and correct copies of the certificate or
articles of incorporation, bylaws or other constituent
instruments of such Subsidiary and that such certificate or
articles of incorporation, bylaws or other constituent
instruments have not been amended or otherwise modified since
the date such copies were delivered to Citibank and (iv) good
standing certificates with respect to the Borrower and each of
its Subsidiaries other than Immaterial Subsidiaries from the
Secretary of State (or similar official) of the state in which
the Borrower or such Subsidiary is incorporated or organized.
(e) A certificate of the Secretary or an Assistant
Secretary of each Loan Party certifying the names and true
signatures of the officers of such Loan Party authorized to
sign each Loan Document to which it is a party and the other
documents to be delivered hereunder.
(f) A certificate of the Borrower, signed on behalf
of the Borrower by its President or a Vice President,
certifying as to the absence of any event occurring and
continuing, or resulting from this Agreement, that constitutes
an
40
46
Event of Default or would constitute an Event of Default but
for the requirement that notice be given or time elapse or
both.
(g) Favorable opinions of N. Xxxxxxx Xxxxxxxx,
general counsel of the Borrower, and Xxxxxx Xxxxxxx Xxxxxx &
Xxxxx, special counsel for the Borrower and the other Loan
Parties, substantially in the forms of Exhibit G.
(h) A favorable opinion of Xxxxxx, Xxxx & Xxxxxxxx
LLP, counsel for the Agent, satisfactory to the Agent.
(i) Such other agreements, certificates, consents and
other documents that the Agent or any Bank may reasonably
request.
(iii) The Borrower shall have paid all fees payable hereunder
on or before the Closing Date.
(iv) Other than as set forth on Schedule VI, no judgment,
order, decree, injunction or other restraint affecting any Loan Party
shall have been rendered or imposed by any court, governmental agency
or arbitrator, and there shall be no pending or threatened action or
proceeding affecting any Loan Party before any court, governmental
agency or arbitrator, which could reasonably be expected to have a
material adverse effect on the business, prospects or condition
(financial or otherwise) or operations of the Borrower and its
Subsidiaries, taken as a whole, or which purports to affect the
legality, validity or enforceability of this Agreement or any other
Loan Document.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
SECTION 4.01. Representations and Warranties of the Borrower. The
Borrower represents and warrants as follows:
(a) The Borrower is a corporation duly incorporated, validly
existing and in good standing under the laws of its jurisdiction of
incorporation, is duly qualified as a foreign corporation and is in
good standing in each jurisdiction as to which the location of its
assets or the nature of its business makes qualification necessary, and
has all power, corporate or otherwise, to conduct its business and to
own, or hold under lease, its assets, and to execute and deliver, and
to perform all of its obligations under, each of the Loan Documents to
which it is or will be a party. Each of the Borrower's Subsidiaries
other than Immaterial Subsidiaries is a corporation, limited liability
company or partnership duly organized, validly existing and in good
standing under the laws of its respective jurisdiction of organization,
is duly qualified as a foreign corporation, limited liability company
or partnership and is in good standing in each jurisdiction as to which
the location of its assets or the nature of its business makes
qualification necessary, and has all power (corporate, limited
liability company, partnership or otherwise) to conduct its business
and to own, or hold under lease, its assets, and to execute and
deliver, and to
41
47
perform all of its obligations under, each of the Loan Documents to
which it is or will be a party.
(b) The execution, delivery and performance by each Loan Party
of each Loan Document to which it is or will be a party are within such
Loan Party's corporate, limited liability company or partnership
powers, have been duly authorized by all necessary corporate, limited
liability company or partnership action, and do not contravene (i) such
Loan Party's certificate or articles of incorporation, by-laws or other
constituent instruments, or (ii) any law, rule, regulation (including,
without limitation, Regulation G, T, U or X of the Board of Governors
of the Federal Reserve System), order, writ, judgment, injunction,
decree, determination or award binding on or affecting such Loan Party
or any of its properties, or (iii) any contractual restriction binding
on or affecting such Loan Party or any of its properties, and do not
result in or require the creation of any Lien upon or with respect to
any of its properties; and no Loan Party is in default in any material
respect under any such law, rule, regulation, order, writ, judgment,
injunction, decree, determination, award or restriction.
(c) No authorization or approval or other action by, and no
notice to or filing with, any governmental authority or regulatory body
is required for the due execution, delivery and performance by any Loan
Party of any Loan Document to which it is or will be a party except for
those which have been duly obtained or made and are in full force and
effect.
(d) This Agreement is, and each other Loan Document to which
each Loan Party will be a party when executed and delivered hereunder
will be, the legal, valid and binding obligation of such Loan Party
enforceable against such Loan Party in accordance with its terms.
(e) The Consolidated balance sheets of the Borrower and its
Subsidiaries as at December 31, 1996 and March 31, 1997 and the related
Consolidated statements of operations, stockholders' equity and cash
flow of the Borrower and its Subsidiaries for the fiscal year and three
months, respectively, then ended have been furnished to the Agent. Such
financial statements, and all financial statements hereafter delivered
pursuant to Sections 5.04(b) and (c), fairly present, or will fairly
present, the financial condition of the Borrower and its Subsidiaries
as at the dates thereof and the results of the operations of the
Borrower and its Subsidiaries for the periods then ended or ending, all
in accordance with generally accepted accounting principles
consistently applied. Since December 31, 1996, there has been no
material adverse change, in the business, prospects or condition
(financial or otherwise) or in the results of operations of the
Borrower and its Subsidiaries taken as a whole.
(f) Each Loan Party has good title to all of its material
property, free and clear of all Liens, except for Permitted Liens. Each
Lease or other agreement relating to the Real Property described in
Schedule I operated by each Loan Party is a valid and subsisting Lease
or other agreement and is in full force and effect in accordance with
the
42
48
terms thereof; and the Borrower or its Subsidiary is in possession
of all such leaseholds and no material default by the Borrower or any
of its Subsidiaries exists under any such Lease or other agreement and,
to the best of the Borrower's knowledge, no lessor has any accrued
right to terminate any such Lease or other agreement on account of a
default by the Borrower or its Subsidiaries.
(g) Each Service Agreement is a valid and subsisting agreement
and is in full force and effect in accordance with the terms thereof;
and no material default by the Borrower or any of its Subsidiaries
exists under any Service Agreement and, to the best of the Borrower's
knowledge, no party to any of the Service Agreements has any accrued
right to terminate any Service Agreement on account of a default by the
Borrower or any of its Subsidiaries.
(h) Other than as set forth on Schedule VI, no judgment,
order, decree, injunction or other restraint affecting any Loan Party
has been rendered or imposed by any court, governmental agency or
arbitrator, and there is no pending or, to the best knowledge of the
Borrower, threatened action or proceeding affecting any Loan Party
before any court, governmental agency or arbitrator, which could
reasonably be expected to have a material adverse effect on the
business, prospects or condition (financial or otherwise) or operations
of the Borrower and its Subsidiaries, taken as a whole, or which
purports to affect the legality, validity or enforceability of this
Agreement or any other Loan Document.
(i) Set forth on Schedule II is a complete and accurate list
of all of the Subsidiaries of the Borrower other than Immaterial
Subsidiaries as of the date hereof, showing as of such date (as to each
such Subsidiary) the nature of its organization, the jurisdiction of
its organization, the number of shares or the amount of interests of
each class of Securities outstanding on the date hereof, the direct
owner of the outstanding shares or the amount of interests of each such
class owned, and the jurisdictions in which such Subsidiary is
qualified to do business as a foreign entity. There are no outstanding
options, warrants, rights of conversion or purchase, and similar rights
to acquire Securities of any of such Subsidiaries, except as set forth
on Schedule II, and all of the outstanding Securities of all of such
Subsidiaries have been validly issued, are fully paid and nonassessable
and are owned by the Borrower or, in the case of limited liability
companies, the Intercompany Creditor, free and clear of (i) all Liens
and (ii) any restrictions (other than laws, rules or regulations) on
the ability to vote or alienate such Securities.
(j) All information, exhibits and reports furnished in writing
by or on behalf of the Borrower or any of its Subsidiaries other than
Immaterial Subsidiaries and made available to the Agent or any Bank
relating to the condition (financial or otherwise), operations,
business or properties of the Borrower or such Subsidiary, are true,
correct and complete and not misleading in all material respects.
43
49
(k) With respect to all business plans and other forecasts and
projections furnished by or on behalf of the Borrower or any of its
Subsidiaries other than Immaterial Subsidiaries and made available to
the Agent or any Bank relating to the financial condition, operations,
business, properties or prospects of the Borrower or such Subsidiary,
to the best of the Borrower's knowledge: (i) all facts stated as such
therein are true and complete in all material respects, (ii) all facts
upon which the forecasts or projections therein contained are based are
true and complete in all material respects, and (iii) all estimates and
assumptions were made in good faith and believed to be reasonable at
the time made.
(l) Schedule IV sets forth, as of the date hereof, all Debt of
the Borrower and its Subsidiaries other than Debt representing
miscellaneous liabilities not in excess of $5,000,000 in the aggregate.
(m) Neither the business nor the properties of the Borrower or
any of its Subsidiaries are affected by any strike, lockout, fire,
explosion, earthquake, embargo, act of God or of the public enemy or
other casualty which could reasonably be expected to have a material
adverse effect on the business, prospects, condition (financial or
otherwise) or results of operations of the Borrower and its
Subsidiaries taken as a whole.
(n) No ERISA Event has occurred with respect to any Plan or is
reasonably expected to occur with respect to any Plan.
(o) Schedule B (Actuarial Information) to the most recently
completed annual report (Form 5500 Series) for each Plan of the
Borrower or its Subsidiaries, copies of which have been or will be
filed with the Internal Revenue Service, is complete and accurate in
all material respects and fairly presents the funding status of such
Plan, and since the date of such Schedule B there has been no material
adverse change in such funding status.
(p) Neither the Borrower nor any ERISA Affiliate has incurred
or is reasonably expected to incur any material Withdrawal Liability to
any Multiemployer Plan.
(q) Neither the Borrower nor any ERISA Affiliate has been
notified by the sponsor of a Multiemployer Plan that such Multiemployer
Plan is in reorganization or has been terminated, within the meaning of
Title IV of ERISA and no Multiemployer Plan is reasonably expected to
be in reorganization or to be terminated, within the meaning of Title
IV of ERISA.
(r) The Borrower and its Subsidiaries on a Consolidated basis
are, and each Loan Party individually is, and after receipt and
application of the Advances in accordance with the terms of this
Agreement and execution of each Loan Document to which it is or is to
be a party will be, Solvent.
44
50
(s) Neither the Borrower nor any Subsidiary of the Borrower
is, or is required to be, registered under the Investment Company Act
of 1940, as amended.
(t) Each of the Borrower and its Subsidiaries is in compliance
in all material respects with the provisions of all Environmental Laws.
Neither the Borrower nor any of its Subsidiaries nor, to the knowledge
of the Borrower, any other Person, has engaged in any Environmental
Activity, nor, to the knowledge of the Borrower, has any Environmental
Activity otherwise occurred, in material violation of any provision of
any applicable Environmental Laws.
(u) Neither the Borrower nor any of its Subsidiaries has any
liability, absolute or contingent, in connection with any Environmental
Activity the satisfaction of which could reasonably be expected to have
a material adverse effect on the business, prospects, condition
(financial or otherwise) or results of operations of the Borrower and
its Subsidiaries taken as a whole.
(v) The Borrower is not engaged in the business of extending
credit for the purpose of purchasing or carrying margin stock (within
the meaning of Regulation U issued by the Board of Governors of the
Federal Reserve System). No proceeds of any Advance will be used to
purchase or carry any margin stock (within the meaning of Regulation U
issued by the Board of Governors of the Federal Reserve System) or to
extend credit to others for the purpose of purchasing or carrying any
margin stock (within the meaning of Regulation U issued by the Board of
Governors of the Federal Reserve System) in violation of applicable
law, including, without limitation, Regulation U issued by the Board of
Governors of the Federal Reserve System.
(w) The Intercompany Creditor (i) is not liable in respect of
any Debt other than Intercompany Debt, (ii) has no other liabilities or
obligations other than contingent obligations that are not material in
amount in respect of operating leases entered into prior to May 1,
1993, and (iii) has not engaged in any operations, and has not received
any notice of a claim or threatened claim in respect of any operations
or the sale thereof, since May 1, 1993.
ARTICLE V
COVENANTS OF THE BORROWER
SECTION 5.01. Affirmative Covenants. So long as any Note shall remain
unpaid, any amount shall remain due hereunder, or any Bank shall have any
Commitment hereunder, the Borrower will, unless the Majority Banks shall
otherwise consent in writing:
(a) Payment of Taxes, Etc. Pay and discharge, and cause each
Subsidiary to pay and discharge, before the same shall become
delinquent, (i) all taxes, assessments and governmental charges or
levies imposed upon it or upon its property, and (ii) all lawful claims
which, if unpaid, might by law become a Lien upon its property;
provided, however, that neither the Borrower nor any Subsidiary shall
be required to pay or
45
51
discharge any such tax, assessment, charge or claim which is being
contested in good faith and by proper proceedings and as to which
appropriate reserves are being maintained.
(b) Maintenance of Insurance. Maintain, and cause each of its
Subsidiaries to maintain, insurance with responsible and reputable
insurance companies or associations (i) in such amounts and covering
such risks as is usually carried by companies engaged in similar
businesses and owning similar properties in the same general areas in
which the Borrower or such Subsidiary operates, and (ii) reasonably
satisfactory to the Agent, and naming the Agent as an additional
insured or as loss payee as the respective interests appear.
(c) Preservation of Corporate Existence, Etc. Except as is
otherwise expressly permitted hereby, preserve and maintain, and cause
each Subsidiary to preserve and maintain, its corporate existence,
rights (charter and statutory) and franchises.
(d) Compliance with Laws, Etc. Comply, and cause each of its
Subsidiaries to comply, in all material respects, with the requirements
of all applicable laws, rules, regulations and orders, including,
without limitation, all Environmental Laws relating to the Real
Property and the ownership, use, operation and occupancy thereof.
(e) Visitation Rights. At any reasonable time and from time to
time after notice, permit the Agent or any of the Banks or any agents
or representatives thereof, to examine and make copies of and abstracts
from the records and books of account of, and visit the properties of,
the Borrower and/or any of the Subsidiaries of the Borrower, and to
discuss the affairs, finances and accounts of the Borrower and any such
Subsidiary with any of their officers or directors and with their
independent certified public accountants.
(f) Keeping of Books. Keep, and cause each Subsidiary of the
Borrower to keep, proper books of record and account, in which full and
correct entries shall be made of all financial transactions and the
assets and business of the Borrower and each such Subsidiary in
accordance with generally accepted accounting principles consistently
applied.
(g) Maintenance of Properties, Etc. Maintain and preserve, and
cause each Subsidiary of the Borrower to maintain and preserve, all of
its properties which are used or useful in the conduct of its business
in good working order and condition, ordinary wear and tear excepted.
(h) Compliance with Terms of All Leaseholds. Make all payments
and otherwise perform, and cause each of its Subsidiaries to make all
payments and otherwise perform, all of its material obligations in
respect of all material Leases, and use its best efforts, and cause
each of its Subsidiaries to use its best efforts, to keep, and to take
all action to keep, such Leases in full force and effect and not allow
any such Leases to lapse or be terminated or any rights to renew such
Leases to be forfeited or canceled; provided,
46
52
however, that any such Lease may lapse or be terminated or such renewal
rights may be forfeited or canceled if in the reasonable business
judgment of the Borrower or its Subsidiary, as the case may be, it is
in its best economic interests to allow or cause such lapse,
termination, forfeiture or cancellation.
(i) Solvency. Continue, and cause each of its Subsidiaries to
continue, to be Solvent.
(j) Further Assurances.
(A) If and to the extent requested by the Agent from
time to time, execute and deliver such documents and take such
other action, and cause each of its Subsidiaries to execute
and deliver such documents and take such other action, as may
be necessary or reasonably requested by the Agent, in order to
assure and confirm that all obligations under this Agreement,
the Notes or any of the other Loan Documents are at all times
guaranteed on terms satisfactory to the Agent by Guaranties of
each of its present and future Subsidiaries other than
Immaterial Subsidiaries.
(B) Promptly upon the acquisition by the Borrower or
one of its Subsidiaries of the Securities of any Subsidiary
that is not an Immaterial Subsidiary or, in the event any
Subsidiary of the Borrower ceases to be an Immaterial
Subsidiary, within 30 days after such Subsidiary ceases to be
an Immaterial Subsidiary, the Borrower will cause such
Subsidiary to enter into a Guaranty.
(C) Promptly upon the acquisition of the Securities
of any Subsidiary of the Borrower or one of its Subsidiaries
that is not an Immaterial Subsidiary or, in the event any
Subsidiary of the Borrower ceases to be an Immaterial
Subsidiary or is owed by the Borrower more than $100,000 in
Intercompany Debt, within 30 days after such Subsidiary ceases
to be an Immaterial Subsidiary or first is owed such amount of
Intercompany Debt, the Borrower will cause such Subsidiary to
enter into the Intercompany Subordination Agreement.
(D) Use its best efforts, from and after the Closing
Date, to obtain supplements to the Subordination Agreements
outstanding on the Closing Date confirming the continued
subordination of the Debt referred to therein, in form and
substance reasonably satisfactory to the Agent.
(k) Employment of Technology; Disposal of Hazardous Materials,
Etc. (i) Employ, and cause each of its Subsidiaries to employ, in
connection with its use, if any, of the Real Property, appropriate
technology and compliance procedures to maintain compliance with any
applicable Environmental Laws, (ii) obtain and maintain, and cause each
of its Subsidiaries to obtain and maintain, any and all material
permits required by applicable Environmental Laws in connection with
its or its Subsidiaries' operations and (iii) dispose of, and cause
each of its Subsidiaries to dispose of, any and all Hazardous
47
53
Substances only at facilities and with carriers reasonably believed to
possess valid permits under RCRA, if applicable, and any applicable
state and local Environmental Laws. The Borrower shall use its best
efforts, and cause each of its Subsidiaries to use its best efforts, to
obtain all certificates required by law to be obtained by the Borrower
and its Subsidiaries from all contractors employed by the Borrower or
any of its Subsidiaries in connection with the transport or disposal of
any Hazardous Substances.
(l) Environmental Matters. If the Borrower or any of its
Subsidiaries shall:
(i) receive written notice that any material
violation of any Environmental Laws may have been committed or
is about to be committed by the Borrower or any of its
Subsidiaries;
(ii) receive written notice that any administrative
or judicial complaint or order has been filed or is about to
be filed against the Borrower or any of its Subsidiaries
alleging any material violation of any Environmental Laws or
requiring the Borrower or any of its Subsidiaries to take any
action in connection with the release or threatened release of
Hazardous Substances or solid waste into the environment; or
(iii) receive written notice from a federal, state,
foreign or local governmental agency or private party alleging
that the Borrower or any of its Subsidiaries is liable or
responsible for costs associated with the response to cleanup,
stabilization or neutralization of any Environmental Activity;
then it shall provide the Agent with a copy of such notice within five
Business Days of the Borrower's or such Subsidiary's receipt thereof.
Within ten days of the date the Borrower or such Subsidiary shall have
learned of the enactment or promulgation of any Environmental Laws
which may have a material adverse effect on the business, property,
condition (financial or otherwise) or results of operations of the
Borrower and its Subsidiaries, taken as a whole, the Borrower shall
provide the Agent with notice thereof. The Borrower shall monitor
compliance with Environmental Laws by any and all owners or operators
of the Real Property.
(m) Violation of Law, Etc. Prior to the Borrower or any
Subsidiary of the Borrower commencing any acquisition of any margin
stock (within the meaning of Regulation U issued by the Board of
Governors of the Federal Reserve System), including, without
limitation, commencing a merger or tender offer for shares of another
Person, the Borrower will deliver to the Agent an opinion of the
general counsel of the Borrower satisfactory to the Agent that such
activity (taking into account Section 5.02(a) and the use or proposed
use of the proceeds of any Advances in connection with such activity)
does not violate any law, rule or regulation (including without
limitation Regulation U issued by the Board of Governors of the Federal
Reserve System).
48
54
SECTION 5.02. Negative Covenants. So long as any Note shall remain
unpaid, any amount shall remain due hereunder, or any Bank shall have any
Commitment hereunder, the Borrower will not, without the written consent of the
Majority Banks:
(a) Liens, Etc. Create, incur, assume or suffer to exist, or
permit any of its Subsidiaries to create, incur, assume or suffer to
exist, any Lien upon or with respect to any of its properties of any
character (including, without limitation, Accounts), whether now owned
or hereafter acquired, or assign any right to receive income, or sign
or file, or permit any of its Subsidiaries to sign or file, under the
Uniform Commercial Code a financing statement that names the Borrower
or any of its Subsidiaries as debtor or the equivalent or sign, or
permit any of its Subsidiaries to sign, any security agreement
authorizing any secured party thereunder to file any such financing
statement or other document, or assign, or permit any of its
Subsidiaries to assign, any Accounts, excluding, however, from the
operation of the foregoing restrictions the Liens created by or
pursuant to the Loan Documents or the $250,000,000 Credit Agreement and
Permitted Liens.
(b) Restrictive Covenants. Enter into, or permit any of its
Subsidiaries to enter into, any agreement or instrument (other than the
Loan Documents) (i) which restricts the ability of the Borrower or any
of its Subsidiaries to create or suffer to exist any Lien upon or with
respect to its Securities, whether now or hereafter issued, or upon or
with respect to any of its properties, whether now owned or leased or
hereafter acquired or leased, except in connection with transactions
contemplated by clause (v) of the definition "Permitted Lien" in which
case any such agreement shall be limited to the property acquired in
connection with such transactions and any Lien granted is limited as
provided in said clause (v) and except for investments of no more than
$10,000,000 in any individual case (or series of individual cases), but
in no event more than $20,000,000 in the aggregate at any time, by the
Borrower and its Subsidiaries in any Person which is not a Subsidiary,
in which the Borrower or its Subsidiaries hold less than 50% of the
equity interest and as to which the Borrower or its Subsidiaries are
prohibited by law to xxxxx x Xxxx on any such equity interest, or (ii)
which restricts the ability of any Subsidiary of the Borrower to (A)
pay dividends or make other distributions on its Securities or to the
Borrower or any other Subsidiary of the Borrower, (B) make any loan or
advance to the Borrower or any of its Subsidiaries, or (C) create,
incur, assume or suffer to exist, or pay or prepay, any Intercompany
Debt, provided, that any such agreement or instrument mandated by any
federal law, rule or regulation or order governing the business of the
Borrower and its Subsidiaries shall not be a violation of this Section
5.02(b)(ii).
(c) Debt. Create, incur, assume or suffer to exist, or permit
any of its Subsidiaries to create, incur, assume or suffer to exist,
any Debt other than:
(i) Debt hereunder;
(ii) Debt under the Loan Documents or under the
$250,000,000 Credit Agreement (and the Loan Documents referred
to and as defined therein);
49
55
(iii) Debt secured by Liens permitted by clause
(v) of the definition of "Permitted Lien";
(iv) the Debt listed on Schedule IV, provided
that such Debt may be renewed, extended or otherwise modified
on terms no less favorable to the Borrower or its Subsidiaries
or the Banks than the existing terms of such Debt;
(v) Debt not otherwise permitted by this Section
5.02(c) incurred by the Borrower and/or its Subsidiaries
(other than the Intercompany Creditor) in connection with the
acquisition of any Facility (or the assets thereof), any
Existing Clinic Acquisition or the acquisition of any Related
Business, so long as such acquisition satisfies all the
conditions precedent set forth in Section 5.02(f)(i) or (ii),
as the case may be;
(vi) convertible Subordinated Debt incurred by
the Borrower or any Subsidiary of the Borrower (other than the
Intercompany Creditor) in connection with the acquisition of a
Facility (or the assets thereof), any Existing Clinic
Acquisition or the acquisition of any Related Business,
provided that the holder of any such Debt shall have executed
and delivered a Subordination Agreement to the Agent;
(vii) Subordinated Debt, whether convertible or
not, in an aggregate principal amount not in excess of
$150,000,000; provided that the Agent and the Majority Banks
shall have approved in writing prior to the issuance thereof
the terms and conditions relating to the issuance of such
Subordinated Debt, including the terms of any indenture
executed in connection therewith;
(viii) any Intercompany Debt or Debt permitted
under the terms of Section 5.02(i) or 5.02(o);
(ix) Contingent Obligations permitted under
Section 5.02(d);
(x) Debt under any interest rate, currency or
other protection, hedge, cap, collar, swap or similar
agreement entered into by the Borrower with any of the Banks
or their respective Affiliates from time to time; and
(xi) unsecured Senior Debt in an aggregate
principal amount not in excess of $50,000,000 incurred by the
Borrower or any of its Subsidiaries (other than the
Intercompany Creditor) to fund any Existing Clinic Acquisition
or the acquisition of any Facility (or the assets thereof) or
any Related Business; provided, however, that such unsecured
Senior Debt contains terms and conditions, including, without
limitation, interest rates, covenants and defaults, no greater
or more restrictive, as the case may be, than those contained
herein; provided, further, that there can be no principal
repayments of such unsecured Senior Debt until one year after
the Revolver Termination Date.
50
56
(d) Contingent Obligations. Create, incur, assume or suffer to
exist, or permit any of its Subsidiaries to create, incur, assume or
suffer to exist, any Contingent Obligations except (i) by reason of
endorsement of negotiable instruments for deposit or collection or
similar transactions in the ordinary course of business, (ii)
Contingent Obligations created pursuant to the Loan Documents or under
the $250,000,000 Credit Agreement (and the Loan Documents referred to
and as defined therein), (iii) guaranties by the Borrower of Capital
Leases, Operating Leases or Service Agreements of any Subsidiary of the
Borrower (including consents by the Borrower to the assignment of such
guaranties), provided that such Capital Leases or Operating Leases are
otherwise permitted hereunder, (iv) Contingent Obligations of the type
specified in clauses (ii) and (iii) of the definition of "Contingent
Obligation" created in the ordinary course of business, (v)
miscellaneous Contingent Obligations not to exceed at any time
outstanding $20,000,000, (vi) guaranties by the Subsidiaries of the
Borrower of the Borrower's obligations under a Capital Lease or an
Operating Lease provided that such Capital Lease or Operating Lease is
otherwise permitted hereunder and only to the extent of the portion of
such Capital Lease or Operating Lease that directly benefits such
Subsidiary, (vii) Contingent Obligations not otherwise permitted by
this Section 5.02(d) incurred by the Borrower and/or its Subsidiaries
(other than the Intercompany Creditor) in connection with the
acquisition of any Facility (or the assets thereof), any Existing
Clinic Acquisition or the acquisition of any Related Business, so long
as such acquisition satisfies all the conditions precedent set forth in
Section 5.02(f)(i) or (ii), as the case may be, (viii) Contingent
Obligations permitted pursuant to Section 5.02(c) and Contingent
Obligations listed on Schedule IV and (ix) Contingent Obligations to
make recruitment subsidy advances pursuant to any Service Agreement.
(e) Restricted Payments. Make, or permit any of its
Subsidiaries to make, any Restricted Payment if at the time such
Restricted Payment is made none of the then outstanding Debt of the
Borrower shall be rated Investment Grade, except that:
(i) the Borrower may pay dividends on its Common
Stock, or purchase or otherwise acquire for value any shares
of its Common Stock (each a "Common Stock Payment"), provided
that (A) no Event of Default or event that would constitute an
Event of Default but for the requirement that notice be given
or time elapse or both shall have occurred and be continuing
or would result from such Common Stock Payment, (B) the
aggregate amount of Common Stock Payments made during the
period from January 1, 1997 through the date of such Common
Stock Payment shall not exceed an amount equal to ten percent
of the Consolidated Net Income of the Borrower and its
Subsidiaries for the period from January 1, 1997 through the
last day of the fiscal quarter most recently ended prior to
the date of such Common Stock Payment (treated for such
purposes as a single accounting period), provided that in no
event may the aggregate amount of Common Stock Payments made
to purchase or otherwise acquire for value shares of Common
Stock exceed $20,000,000 in the aggregate for all such
purchases or other acquisitions, and (C) the Borrower shall
have provided the Agent with a certificate of the treasurer or
chief financial officer of the Borrower setting forth
51
57
computations in reasonable detail demonstrating satisfaction
of the foregoing conditions; and
(ii) the Borrower and its Subsidiaries may make
Restricted Payments to terminated employees in an amount not
to exceed $100,000 in any year.
(f) Capital Investments. Make, or permit any of its
Subsidiaries to make, any Capital Investments, provided that:
(i) the Borrower and the Subsidiaries of the
Borrower (other than the Intercompany Creditor) can make
Capital Investments consisting of an acquisition of a Facility
(or the assets thereof) or Related Businesses or Existing
Clinic Acquisitions (whether through the acquisition of assets
or Securities) that satisfy all of the following:
(A) the Total Consideration for each
such acquisition shall be less than $75,000,000;
(B) the aggregate Total Consideration
for all such acquisitions in any twelve-month period
shall not exceed $500,000,000;
(C) the aggregate number of such
acquisitions (other than Existing Clinic
Acquisitions) in any twelve-month period shall not
exceed fifteen;
(D) except in the case of Existing
Clinic Acquisitions, the Agent and the Banks shall
have received at least one day before the scheduled
closing for such acquisition the following financial
and other information:
(1) the Total Consideration to be
paid for such acquisition;
(2) summary financial information
relating to the Facility or Related Business
to be acquired, including operating
forecasts and information as to the numbers
of physicians and physician assistants
involved and any other information
reasonably requested by the Agent; and
(3) a schedule, duly certified by
the chief financial officer of the Borrower,
demonstrating compliance on a pro forma
basis with the financial covenants contained
in Section 5.03 after such acquisition;
provided, however, that in preparing such
pro forma schedule, the Borrower shall
include all Debt to be incurred in
connection with such acquisition and the
EBITDA of the Facility or Related Business
to be acquired (which shall be based
52
58
on audited, if available, historical
numbers, adjusted as contemplated by Section
5.03);
(E) the Agent and the Banks shall have
received at least one day before the scheduled
closing of such acquisition all other information,
financial or otherwise, regarding such acquisition as
the Agent or the Banks may reasonably request;
(F) except in the case of Existing Clinic
Acquisitions, the Agent shall have received, on or
before the date of such acquisition, each of the
following documents:
(1) a Guaranty (dated on or before
the date of such acquisition), duly executed
by the Subsidiary of the Borrower formed to
acquire or resulting from the acquisition of
such Facility (or the assets thereof) or
Related Business, unless immediately after
giving effect to such acquisition such
Subsidiary will be an Immaterial Subsidiary;
(2) an amendment (dated on or before
the date of such acquisition) to the
Intercompany Subordination Agreement, which
amendment shall make the Subsidiary of the
Borrower formed to acquire or resulting from
the acquisition of such Facility (or the
assets thereof) or Related Business a
"Subordinated Creditor" under such
Intercompany Subordination Agreement, unless
immediately after giving effect to the
acquisition such Subsidiary will be an
Immaterial Subsidiary;
(3) certified copies of resolutions
of the Board of Directors or other governing
body of such Subsidiary authorizing the
execution and delivery of such Loan
Documents, together with certificates of
incumbency with respect to the individuals
executing such Loan Documents;
(4) a supplement to Schedule I
hereto to the extent such supplement is
necessary to make the representation and
warranty contained in Section 4.01(f)
correct on and as of the date of such
acquisition; and
(5) such other documents (including
a favorable legal opinion of the general
counsel of the Borrower) as the Agent may
reasonably request.
(ii) the Borrower and the Subsidiaries of the
Borrower (other than the Intercompany Creditor) can make
Capital Investments consisting of an acquisition of a Facility
(or the assets thereof) or Related Businesses for which the
Total
53
59
Consideration (whether through the acquisition of assets or
Securities) equals or exceeds $75,000,000 only with the prior
approval in writing of the terms and conditions of such
acquisition by the Majority Banks in substantially the form of
Exhibit H (it being understood that the Banks shall use
reasonable efforts to notify the Borrower within ten Business
Days after receipt of all of the information regarding a
proposed acquisition described in clause (A) below of their
decision to approve or disapprove the proposed acquisition),
and
(A) the Banks and the Agent shall have
received complete information, financial and
otherwise, regarding the proposed acquisition as may
be necessary or desirable, in the reasonable judgment
of the Banks, to enable the Banks to evaluate the
proposed acquisition for the purpose of approving
such acquisition under this Section 5.02(f)(ii),
including, without limitation, information regarding
the Total Consideration to be paid, a schedule, duly
certified by the chief financial officer of the
Borrower, demonstrating compliance on a pro forma
basis with the financial covenants contained in
Section 5.03 after such acquisition, and any other
information as the Banks may reasonably request;
provided, however, that in preparing such pro forma
schedule, the Borrower shall include all Debt to be
incurred in connection with such acquisition and the
EBITDA of the Facility or Related Business to be
acquired (which shall be based on audited, if
available, historical numbers, adjusted as
contemplated by Section 5.03); and
(B) the Agent shall have received on or
before the day of such acquisition, in form and
substance satisfactory to the Agent, each of the
documents described in subsection 5.02(f)(i)(F).
(iii) the Borrower and its Subsidiaries may make
Capital Expenditures that are not acquisitions of, or other
investments in, Facilities, Related Businesses or other
Persons (or all or substantially all of the assets thereof) in
the ordinary course of business, provided that no Event of
Default or event that would constitute an Event of Default but
for the requirement that notice be given or time elapse or
both shall have occurred and be continuing or would result
therefrom.
(iv) the Borrower and its Subsidiaries may make
capital investments in, and loans and advances to, Subsidiary
joint ventures, general or limited partnerships, limited
liability companies or other types of Persons that are not
wholly-owned by the Borrower and its Subsidiaries in an
aggregate amount of not more than $10,000,000 during any
fiscal year, and in no event in an aggregate amount exceeding
$30,000,000 at any time outstanding.
(v) the Borrower and its Subsidiaries may make
capital investments in, and loans and advances to, joint
ventures, general or limited partnerships, limited
54
60
liability companies or other types of Persons that are not
Subsidiaries in an aggregate amount not exceeding $10,000,000
at any time outstanding.
(vi) without limiting amounts that may be
invested in, or loaned or advanced to other Persons pursuant
to Section 5.02(f)(v), the Borrower's Subsidiary PhyCor of
Hawaii, Inc. ("PhyCor-Hawaii") may make secured loans to
Xxxxxx Clinic & Hospital, Inc. ("Xxxxxx") to the extent
required by, and in compliance with, Sections 5.8.1, 5.8.2 and
5.8.3 of its Service Agreement with Xxxxxx (the "Xxxxxx
Service Agreement"); provided that:
(A) at the time of each such loan and after
giving effect thereto, no Event of Default or event
which would constitute an Event of Default but for
the requirement that notice be given or time elapse
or both shall occur and be continuing;
(B) loans pursuant to Section 5.8.1 of the
Xxxxxx Service Agreement ("Xxxxxx Capital Loans")
shall be secured by a first priority security
interest in all of the assets directly or indirectly
acquired by Xxxxxx from the proceeds of any such
loans, free and clear of any other Liens; and the
aggregate principal amount of all Xxxxxx Capital
Loans may not exceed $50,000,000 at any time
outstanding;
(C) loans pursuant to Section 5.8.2 of the
Xxxxxx Service Agreement ("Xxxxxx Working Capital
Loans"; collectively, with the Xxxxxx Capital Loans,
the "Xxxxxx Loans") shall be made pursuant to a
single credit facility providing loan availability
for no more than one year from the commencement of
the term thereof (which may be renewed on an annual
basis) and shall be secured by a first priority
security interest in all of the accounts receivable,
inventory, supplies and other current assets of
Xxxxxx (the "Xxxxxx Loan Base"), free and clear of
any other Liens; and the aggregate principal amount
of all Xxxxxx Working Capital Loans may not exceed at
any time outstanding the lesser of (1) $40,000,000 or
(2) the aggregate book value (less any reserves
applicable thereto) of (x) the Xxxxxx Loan Base as of
such time and (y) any current assets acquired by the
Borrower in its merger with Xxxxxx Clinic & Hospital,
Incorporated and held by the Borrower at such time,
all as determined in accordance with generally
accepted accounting principles; and
(D) each Xxxxxx Loan shall be evidenced by a
promissory note (1) that shall provide for the
repayment of principal prior to final maturity at the
annual rate of one-sixth of the principal outstanding
at the time loan availability under the applicable
credit facility for Xxxxxx ceases and (2) that shall
be subject to the repurchase right of Xxxxxx provided
in the Xxxxxx Service Agreement.
55
61
(g) Mergers, Etc. Merge or consolidate with or into, or
convey, transfer, lease or otherwise dispose of (whether in one
transaction or in a series of transactions) all or substantially all of
its assets (whether now owned or hereafter acquired) to, or acquire all
or substantially all of the assets (other than the acquisition of
assets of any Facility or Related Business or an Existing Clinic
Acquisition, whether or not such acquisition is accomplished by merger
or by Securities or asset purchase, so long as such acquisition
satisfies all the conditions precedent set forth in Section 5.02(f)(i)
or (ii) and, if any merger involves the Borrower, the Borrower is the
surviving corporation) of, any Person, or permit any of its
Subsidiaries to do so, except that:
(i) any Subsidiary may consolidate with or merge
into the Borrower (only if the Borrower shall be the
continuing or surviving corporation) or (except for the
Intercompany Creditor) with or into one or more other
Subsidiaries that are Guarantors, provided that (A)
immediately before and after giving effect to such
consolidation or merger, the parties thereto and the survivor
thereof all are Solvent, (B) all Guaranties shall continue in
full force and effect, and (C) the Agent shall have been
furnished with a favorable opinion of counsel reasonably
satisfactory to the Agent covering such matters as the Agent
may reasonably request; and
(ii) the Borrower may consolidate or merge with any
other Person, provided that (A) immediately before and after
giving effect to such consolidation or merger, the parties
thereto and the survivor thereof all are Solvent, (B) the
Borrower shall be the continuing or surviving corporation, (C)
no Change of Control shall occur and (D) all Guaranties shall
continue in full force and effect;
provided, however, that immediately before and after any consolidation
or merger under this Section 5.02(g), no Event of Default, or event
which, with the giving of notice or lapse of time or both, would become
an Event of Default, shall have occurred and be continuing.
(h) Limitation on Sales of Assets. Except for the sale of
inventory in the ordinary course of business, the sale of worn-out or
obsolete assets and intercompany transfers permitted under Section
5.02(g), sell, lease, transfer or otherwise dispose of its assets, or
permit any Subsidiary to sell, lease, transfer or otherwise dispose of
its assets (including any interest in a Subsidiary), unless (i) the
book value of such assets sold constitutes less than 5% of the value of
the Borrower's Consolidated Tangible Net Assets at the time of sale or
other disposition, provided that the aggregate book value of all such
assets sold in any twelve-month period shall not exceed 15% of the
value of the Borrower's average Consolidated Tangible Net Assets for
the twelve-month period ending with the quarter immediately preceding
the date of determination, as evidenced by a certificate duly executed
by the chief financial officer of the selling entity on the date of
such sale or disposition, and provided further that such assets do not
constitute Securities of the Intercompany Creditor or Intercompany
Debt, or (ii) such sale is required in connection with the termination
of a Service Agreement or a change in control under the
56
62
Amended Securities Purchase Agreement, dated as of January 1, 1995,
with respect to NAMM, and, in each case, the Net Cash Proceeds of such
sale are delivered directly to the Agent to be applied in accordance
with Section 2.09(e).
(i) Transactions with Affiliates. Lend or advance money to,
contract with or engage in any other transactions with, or permit any
Subsidiary of the Borrower to lend or advance money to, contract with
or engage in any other transactions with, Subsidiaries or Affiliates of
the Borrower, except in the ordinary course of their business with
third parties or on terms and for consideration which is no less
favorable to the Borrower and its Subsidiaries than the terms and
consideration which the Borrower or such Subsidiaries would be
obligated to pay in an arms' length transaction, subject, however, to
the limitation that the Borrower and its Subsidiaries shall not loan
more than $100,000 times the number of Facilities operated by the
Borrower and its Subsidiaries to employees at any one time outstanding;
provided, however, that nothing in this Section 5.02(i) shall prohibit
the Borrower and its Subsidiaries from engaging in transactions with
joint ventures in which the Borrower or any of its Subsidiaries is a
joint venture partner to the extent permitted by Section 5.02(f)(iv) or
(v).
(j) Prepayments of Debt. Prepay, redeem, defease (whether
actually or in substance) or purchase in any manner (or deposit or set
aside funds or securities for the purpose of the foregoing), or make
any payment (other than for scheduled payments of principal and
interest due on the date of payment thereof, if such payment is
permitted to be made pursuant to the terms of the documents evidencing
or governing the applicable Debt) in respect of, or establish any
sinking fund, reserve or like set-aside of funds or other property for
the redemption, retirement or repayment of, any Debt, or transfer any
property in payment of or as security for the payment of, or violate
the subordination terms of, any Debt, or amend, modify or change in any
manner less favorable to Borrower or any of its Subsidiaries or the
Banks the terms of any Debt or any instrument, indenture or other
document evidencing, governing or affecting the terms of any Debt, or
cause or permit any of its Subsidiaries to do any of the foregoing;
provided, however, that nothing in this Section 5.02(j) shall prohibit
(i) any payments of the Debt under this Agreement or the $250,000,000
Credit Agreement in accordance with the terms hereof or thereof, (ii)
the conversion of convertible Subordinated Debt of the Borrower into
Securities of the Borrower, (iii) the prepayment in any fiscal year of
the Borrower of up to $30,000,000 in principal amount of Senior Debt of
the Borrower or any of its Subsidiaries if the effective yield payable
in respect of such Senior Debt is greater than the interest payable
hereunder in respect of Base Rate Advances or Eurodollar Rate Advances,
whichever is lower, (iv) the prepayment of the existing operating
capital notes payable to the various physicians listed on Schedule IV
in the aggregate principal amount specified therein, (v) setoff of any
convertible Subordinated Debt against the purchase price to be paid by
the holder of such Debt in connection with the repurchase by such
holder of any Facility pursuant to the Asset Purchase Agreement
relating to such Facility, or (vi) payment of any Deferred Acquisition
Consideration in connection with any acquisition of Facilities (or the
assets thereof), any Existing Clinic Acquisition or any
57
63
acquisition of a Related Business to the extent such acquisition
satisfies the requirements of Section 5.02(f)(i) or (ii), as the case
may be.
(k) Accounting Changes. Change its fiscal year, or make, or
permit any of its Subsidiaries to make, any other significant change in
Consolidated accounting treatment and reporting practices except as
required or permitted by generally accepted accounting principles.
(l) Change in Nature of Business. Make, or permit any of its
Subsidiaries to make, any material change in the nature of its business
as conducted as of the date hereof.
(m) Securities. Except as is provided in Section 5.02(g),
permit any of its Subsidiaries to issue or sell any of its Securities
or any rights, warrants or options to acquire any of its Securities, or
permit any of its Subsidiaries to sell or otherwise dispose of any
Securities of any of its Subsidiaries, or permit any of its
Subsidiaries to amend its charter, bylaws or other constituent
instruments so as to affect the conversion rights, payments, privileges
or other terms in respect of such Securities or in any respect that
affects any of the foregoing interests of its respective
securityholders.
(n) Welfare Plan Liabilities. Create or suffer to exist, or
permit any of its Subsidiaries to create or suffer to exist, any
liability with respect to Welfare Plans if, immediately after giving
effect to such liability, the aggregate annualized cost (including,
without limitation, the cost of insurance premiums) with respect to
Welfare Plans and other benefit plans and insurance of the type
described in the definition of "Welfare Plans" contained in Section
1.01 for which the Borrower and its Subsidiaries are or may become
liable in any fiscal year of the Borrower could have a material adverse
effect on the business, property, prospects, condition (financial or
otherwise) or results of operations of the Borrower and its
Subsidiaries, taken as a whole.
(o) Intercompany Creditor. Permit the Intercompany Creditor to
engage in any business or operations except the receipt and advancing
of Intercompany Debt and the holding of Intercompany Debt or Securities
of other Subsidiaries of the Borrower.
SECTION 5.03. Financial Covenants. So long as any Note shall remain
unpaid, any amount shall remain due hereunder, or any Banks shall have any
Commitment hereunder, the Borrower will not, without the written consent of the
Majority Banks:
(a) Consolidated Net Worth. Permit at any date of
determination the Consolidated Net Worth of the Borrower and its
Subsidiaries to be less than $415,000,000, plus (i) 80% of the net
proceeds received from the issuance, sale or disposition of the
Borrower's Securities (common, preferred or special), securities
converted into or exchanged for Securities, and any rights, options,
warrants and similar instruments from December 31, 1996 to such date of
determination and (ii) 50% of positive Consolidated Net Income (if any)
earned from December 31, 1996 through such date of determination.
58
64
(b) Fixed Charge Coverage Ratio. Permit, for the four
consecutive fiscal quarters ending June 30, 1997 and for each period of
four consecutive fiscal quarters ending thereafter, the Consolidated
Fixed Charge Coverage Ratio of the Borrower and its Subsidiaries,
calculated at the end of each fiscal quarter of the Borrower, to be
less than 1.25 to 1.00.
(c) Consolidated Debt/Total Capitalization Ratio. Permit, at
any time, the Consolidated Debt/Total Capitalization Ratio of the
Borrower and its Subsidiaries to be greater than 60%.
(d) Consolidated Debt/EBITDA Ratio. Permit, for each period of
four consecutive fiscal quarters ending June 30, 1997 and for each
period of four consecutive fiscal quarters ending thereafter, the
Consolidated Debt/EBITDA Ratio of the Borrower and its Subsidiaries to
be greater than 3.75 to 1.00.
(e) Consolidated Senior Debt/EBITDA Ratio. Permit, for each
period of four consecutive fiscal quarters ending June 30, 1997 and for
each period of four consecutive fiscal quarters ending thereafter, the
Consolidated Senior Debt/EBITDA Ratio of the Borrower and its
Subsidiaries to be greater than 2.50 to 1.00.
For the purposes of subsections (b), (c), (d) and (e) above and the calculation
of any Applicable Eurodollar Rate Margin and the Applicable Facility Fee Rates,
if, as of any date, a determination of EBITDA, EBITDAL, Lease Expense, Capital
Expenditures or any other component of the ratios referred to in such
subsections (the "Ratio Components") is required to be made as to any period
prior to the date of such determination (a "Determination Period"), such
determination shall be made so as to give effect to the following:
(i) if any Person, Facility or Related Business (an "Acquired
Business") shall have been acquired in compliance with this Agreement
since the beginning of such Determination Period and must be
Consolidated with the Borrower and its Subsidiaries in accordance with
GAAP, the Ratio Components of such Acquired Business from the beginning
of the Determination Period to the date of acquisition shall be
included on a pro forma basis with the same effect as if such Acquired
Business had been a Consolidated Subsidiary of the Borrower for such
portion of the Determination Period, subject to the following:
(A) for any date of determination occurring on or
before the completion of one full fiscal quarter after the
date of acquisition of such Acquired Business, pro forma
adjustments may be made to reflect (1) specifically identified
changes in physician compensation, complements of physicians,
malpractice insurance costs and other group purchase
arrangements, all of which shall be consistent with the terms
and conditions of any Service Agreement entered into in
connection with such acquisition and (2) other planned cost
savings which will be realized by such Acquired Business as a
consequence of such acquisition to the
59
65
extent demonstrated by the Borrower to the satisfaction of the Majority
Banks; and
(B) For any date of determination occurring after the
completion of one full fiscal quarter after the date of such
acquisition, the actual Ratio Components for the period
through the end of the then most recently ended fiscal quarter
shall be annualized for the Determination Period; and
(ii) if any Person, Facility or Related Business (a
"Disposed Business") which shall have been Consolidated with the
Borrower and its Subsidiaries shall have been discontinued, lost, sold
or otherwise disposed of as of the date of determination, the Ratio
Components of such Disposed Business shall be excluded for the
Determination Period.
SECTION 5.04. Reporting Requirements. So long as any Note shall remain
unpaid, or amount shall remain due hereunder or any Bank shall have any
Commitment hereunder, the Borrower will furnish to the Agent, for distribution
to the Banks, in sufficient copies for each Bank, the following:
(a) as soon as available and in any event within 30 days after
the end of each month, Consolidated balance sheets of the Borrower and
its Subsidiaries as of the end of such month and Consolidated
statements of operations and cash flow position of the Borrower and its
Subsidiaries for such month and for the period commencing at the end of
the previous fiscal year and ending with the end of such month;
(b) as soon as available and in any event within 45 days after
the end of each fiscal quarter, Consolidated balance sheets of the
Borrower and its Subsidiaries as of the end of such fiscal quarter and
Consolidated statements of operations and cash flow of the Borrower and
its Subsidiaries for the period commencing at the end of the previous
fiscal year and ending with the end of such fiscal quarter, certified
by the chief financial officer of the Borrower, together with (i) a
certificate of said officer stating that no Event of Default has
occurred and is continuing or, if an Event of Default has occurred and
is continuing, a statement as to the nature thereof and the action that
the Borrower has taken or proposes to take with respect thereto, (ii) a
schedule in form satisfactory to the Agent of the computations used by
the Borrower in determining compliance with the covenants contained in
Section 5.03 and in sufficient detail for determining the Applicable
Facility Fee Rates and the Applicable Eurodollar Rate Margins in
accordance with the definitions of such terms set forth in Section
1.01, and (iii) a certificate of said officer or of the general counsel
of the Borrower regarding additions to and deletions from Schedule I
reflecting changes occurring during such fiscal quarter;
(c) as soon as available and in any event within 120 days
after the end of each fiscal year, a copy of the annual audit report
for such year for the Borrower, including therein an audited
Consolidated balance sheet of the Borrower and its Subsidiaries as of
the end of such fiscal year and audited Consolidated statements of
operations, stockholders' equity and cash flow of the Borrower and its
Subsidiaries for such fiscal
60
66
year (i) certified by a nationally recognized public accounting firm,
together with a certificate of such accounting firm stating that in the
course of the regular audit of the business of the Borrower, which
audit was conducted in accordance with generally accepted auditing
standards, such accounting firm has obtained no knowledge that an Event
of Default has occurred and is continuing, or, if in the opinion of
such accounting firm, an Event of Default has occurred and is
continuing, a statement as to the nature thereof, and (ii) accompanied
by a copy of the management letter from such accounting firm
accompanying such financial statements;
(d) as soon as possible and in any event within two days after
the occurrence of an Event of Default of which the Borrower or any
Subsidiary has knowledge, a statement of the chief financial officer of
the Borrower setting forth details of such Event of Default and the
action which the Borrower has taken and proposes to take with respect
thereto;
(e) promptly after any change in accounting policies or
reporting practices that could reasonably be expected to have a
material adverse effect on the condition (financial or otherwise),
operations, business, assets or prospects of the Borrower or of any of
its Subsidiaries or on the rights of the Banks under any of the Loan
Documents, notice and a description in reasonable detail of such
change;
(f) promptly and in any event within ten days after the
Borrower or any ERISA Affiliate knows or has reason to know that any
ERISA Event has occurred, a statement of the chief financial officer of
the Borrower describing such ERISA Event and the action, if any, that
the Borrower or such ERISA Affiliate has taken or proposes to take with
respect thereto;
(g) promptly and in any event within two Business Days after
receipt thereof by the Borrower or any ERISA Affiliate (i) copies of
each notice from the PBGC stating its intention to terminate any Plan
or to have a trustee appointed to administer any Plan and (ii) copies
of each material notice received from the United States Department of
Labor in connection with any ERISA requirements;
(h) promptly and in any event within five Business Days after
receipt thereof by the Borrower or any ERISA Affiliate from the sponsor
of a Multiemployer Plan, a copy of each notice received by the Borrower
or any ERISA Affiliate concerning (i) the imposition of Withdrawal
Liability by a Multiemployer Plan, (ii) the determination that a
Multiemployer Plan is, or is expected to be, in reorganization within
the meaning of Title IV of ERISA, (iii) the termination of a
Multiemployer Plan within the meaning of Title IV of ERISA or (iv) the
amount of liability incurred, or expected to be incurred, by the
Borrower or any ERISA Affiliate in connection with any event described
in clause (i), (ii) or (iii) above;
(i) promptly and in any event within ten days after the
commencement thereof, notice of all actions, suits and proceedings
before any court or governmental
61
67
department, commission, board, bureau, agency or instrumentality,
domestic or foreign, affecting the Borrower or any of its Subsidiaries,
of the type described in Section 4.01(h);
(j) promptly and in any event within ten days after the
sending or filing in final form thereof, copies of all proxy statements
and financial statements that the Borrower or any of its Subsidiaries
sends to its securityholders generally, and copies of all registration
statements (other than those relating to employee stock plans), without
exhibits, all periodic reports on Forms 10-K and 10-Q and reports on
Form 8-K that the Borrower or any of its Subsidiaries files with the
Securities and Exchange Commission or any governmental authority that
may substituted therefor, or any national securities exchange or with
the National Association of Securities Dealers;
(k) promptly after the occurrence thereof, notice of (A) any
event of which Borrower or any Subsidiary is aware which makes any of
the representations obtained in Section 4.01 inaccurate in any respect
or (B) the receipt by the Borrower or any Subsidiary of any notice,
order, directive or other communication from a governmental authority
alleging violations of or noncompliance with any Environmental Law; and
(l) such other information respecting the condition or
operations, financial or otherwise, of the Borrower or any of its
Subsidiaries as any Bank through the Agent may from time to time
reasonably request.
Notwithstanding the foregoing, upon the occurrence and during the continuance of
an Event of or a Default, the Borrower will, and will cause its Subsidiaries to,
provide to the Agent for each Bank additional information and any and all of the
above information more frequently to the extent reasonably requested by the
Agent or any Bank.
ARTICLE VI
EVENTS OF DEFAULT
SECTION 6.01. Events of Default. If any of the following events (each
an "Event of Default") shall occur and be continuing:
(a) the Borrower shall fail to pay any principal of any
Advance or Note when the same becomes due and payable; or the Borrower
shall fail to pay any interest on any Advance, Note, or any fees or
other amounts payable under any Loan Document, in each case within five
days after the same becomes due and payable; or
(b) any representation or warranty made or deemed by any Loan
Party (or any of its officers) in any Loan Document or certificate or
other writing delivered pursuant thereto shall prove to have been
incorrect in any material respect when made or deemed made; or
(c) (i) any Loan Party shall fail to perform or observe any
term, covenant or agreement contained in Section 5.01, Section 5.02 or
Section 5.03; or (ii) any Loan Party
62
68
shall fail to perform or observe any other term, covenant or agreement
contained in this Agreement or in any other Loan Document on its part
to be performed or observed if such failure shall remain unremedied for
ten days after written notice thereof shall have been given to such
Loan Party by the Agent or any Bank; or
(d) any Loan Party or any of its Subsidiaries shall fail to
pay any principal of or premium or interest on any Debt which is
outstanding under the $250,000,000 Credit Agreement or in a principal
amount of at least $5,000,000 in the aggregate (but excluding Debt
evidenced by the Notes) of such Loan Party or such Subsidiary (as the
case may be), when the same becomes due and payable (whether by
scheduled maturity, required prepayment, acceleration, demand or
otherwise), and such failure shall continue after the applicable grace
period, if any, specified in the agreement or instrument relating to
such Debt; or any other event shall occur or condition shall exist
under any agreement or instrument relating to any such Debt and shall
continue after the applicable grace period, if any, specified in such
agreement or instrument, if the effect of such event or condition is to
accelerate, or to permit the acceleration of, the maturity of such
Debt; or any such Debt shall be declared to be due and payable, or
required to be prepaid (other than by a regularly scheduled required
prepayment and except as required by Section 2.09 of the $250,000,000
Credit Agreement), redeemed, purchased or defeased, or any offer to
prepay, redeem, purchase or defease such Debt shall be required to be
made, in each case prior to the stated maturity thereof; or
(e) any Loan Party or any of its Subsidiaries shall generally
not pay its debts as such debts become due, or shall admit in writing
its inability to pay its debts generally, or shall make a general
assignment for the benefit of creditors; or any proceeding shall be
instituted by or against any Loan Party or any of its Subsidiaries
seeking to adjudicate it a bankrupt or insolvent, or seeking
liquidation, winding up, reorganization, arrangement, adjustment,
protection, relief, or composition of it or its debts under any law
relating to bankruptcy, insolvency or reorganization or relief of
debtors, or seeking the entry of an order for relief or the appointment
of a receiver, trustee, custodian or other similar official for it or
for any substantial part of its property and, in the case of any such
proceeding instituted against it (but not instituted by it), either
such proceeding shall remain undismissed or unstayed for a period of 30
days, or any of the actions sought in such proceeding (including,
without limitation, the entry of an order for relief against, or the
appointment of a receiver, trustee, custodian or other similar official
for, it or for any substantial part of its property) shall occur; or
any Loan Party or any of its Subsidiaries shall take any corporate
action to authorize any of the actions set forth above in this
subsection (e); or
(f) any proceeding shall be instituted against any Loan Party
or any of its Subsidiaries seeking to adjudicate it a bankrupt or
insolvent or seeking liquidation, winding up, reorganization,
arrangement, adjustment, protection, relief or composition of it or its
debts under any law relating to bankruptcy, insolvency or
reorganization or relief or protection of debtors or seeking the entry
of an order for relief or the appointment of a receiver, trustee,
custodian or other similar official for it or for any substantial part
of its
63
69
property, and either such proceeding shall remain undismissed or
unstayed for a period of 30 days or any of the actions sought in such
proceeding (including, without limitation, the entry of an order for
relief against it or the appointment of a receiver, trustee, custodian
or other similar official for it or for any substantial part of its
property) shall occur; or
(g) any judgment or order for the payment of money in excess
of $5,000,000 which is not covered by insurance shall be rendered
against any Loan Party or any of its Subsidiaries and either (i)
enforcement proceedings shall have been commenced by any creditor upon
such judgment or order or (ii) there shall be any period of ten
consecutive days during which a stay of enforcement of such judgment or
order, by reason of a pending appeal or otherwise, shall not be in
effect; or
(h) any non-monetary judgment or order shall be rendered
against the Borrower or any of its Subsidiaries that is materially
adverse to the business, property, prospects, condition (financial or
otherwise) or results of operations of the Borrower and its
Subsidiaries, taken as a whole, and either (i) enforcement proceedings
shall have been commenced by any Person upon such judgment or order or
(ii) there shall be any period of ten consecutive days during which a
stay of enforcement of such judgment or order, by reason of a pending
appeal or otherwise, shall not be in effect; or
(i) any Loan Document after delivery thereof pursuant to
Article III hereof or otherwise shall, for any reason cease to be valid
and binding on the respective Loan Party or Loan Parties thereto; or a
Loan Party shall so state in writing or shall contest the validity or
enforceability of any material term or provision of any Loan Document;
or
(j) any one or more Service Agreements shall be terminated
during any period of four consecutive fiscal quarters that represent,
in the aggregate, 5% of the Consolidated EBITDA of the Borrower and its
Subsidiaries for such period, measured as of the end of any fiscal
quarter ending after the date of any such termination, provided that it
shall not be an Event of Default hereunder if the Service Agreement for
the Facility owned by PhyCor of Ruston, Inc. is terminated without
cause; or
(k) any ERISA Event with respect to a Plan shall have occurred
and, 30 days after notice thereof shall have been given to the Borrower
by the Agent, (i) such ERISA Event shall still exist and (ii) the sum
(determined as of the date of occurrence of such ERISA Event) of the
Insufficiency of such Plan and the Insufficiency of any and all other
Plans with respect to which an ERISA Event shall have occurred and then
exist (or in the case of a Plan with respect to which an ERISA Event
described in clauses (iii) through (vi) of the definition of ERISA
Event shall have occurred and then exist, the liability related
thereto) is equal to or greater than $5,000,000 for any fiscal year; or
(l) the Borrower or any ERISA Affiliate shall have been
notified by the sponsor of a Multiemployer Plan that it has incurred
Withdrawal Liability to such Multiemployer Plan in an amount that, when
aggregated with all other amounts required to be paid to Multiemployer
Plans by the Borrower and its ERISA Affiliates as
64
70
Withdrawal Liability (determined as of the date of such notification),
exceeds $5,000,000 for any fiscal year; or
(m) the Borrower or any ERISA Affiliate shall have been
notified by the sponsor of a Multiemployer Plan that such Multiemployer
Plan is in reorganization or is being terminated, within the meaning of
Title IV of ERISA, if as a result of such reorganization or termination
the aggregate annual contributions of the Borrower and its ERISA
Affiliates to all Multiemployer Plans that are then in reorganization
or being terminated have been or will be increased over the amounts
contributed to such Multiemployer Plans for the respective plan year of
each such Multiemployer Plan immediately preceding the plan year in
which the reorganization or termination occurs by an amount exceeding
$5,000,000; or
(n) there shall occur any Change of Control; or
(o) any three of Messrs. Xxxxxx X. Xxxxx, Xxxxxxxx X. Xxxx,
Xxxxxx X. Xxxxxx or Xxxxxxx X. Xxxxxx shall, within any six-month
period, cease to be employed full time as officers of the Borrower
other than by reason of the death or incapacity of any such person; or
(p) since December 31, 1996 there has been, in the reasonable
judgment of the Agent or the Majority Banks, any material adverse
change in the Consolidated condition, financial or otherwise,
operations, properties or prospects of the Borrower and its
Subsidiaries taken as a whole;
then, and in any such event, the Agent (i) shall at the request, or may with the
consent, of the Majority Banks, by notice to the Borrower, declare the
obligation of each Bank to make Advances to be terminated, whereupon the same
shall forthwith terminate, (ii) shall at the request, or may with the consent,
of the Majority Banks, by notice to the Borrower, declare the Notes, all
interest thereon and all other amounts payable under this Agreement to be
forthwith due and payable, whereupon the Notes, all such interest and all such
amounts shall become and be forthwith due and payable, without presentment,
demand, protest or further notice of any kind, all of which are hereby expressly
waived by the Borrower and (iii) shall at the request, or may with the consent,
of the Majority Banks exercise any other remedies provided hereunder or by law;
provided, however, that in the event of an actual or deemed entry of an order
for relief with respect to the Borrower or any of its Subsidiaries under the
Federal Bankruptcy Code, (A) the obligation of each Bank to make Advances shall
automatically be terminated and (B) the Notes, all such interest and all such
amounts shall automatically become and be due and payable, without presentment,
demand, protest or any notice of any kind, all of which are hereby expressly
waived by the Borrower.
65
71
ARTICLE VII
THE AGENT
SECTION 7.01. Authorization and Action. Each Bank hereby appoints and
authorizes the Agent to take such action as agent on its behalf and to exercise
such powers under this Agreement as are delegated to the Agent by the terms
hereof, together with such powers as are reasonably incidental thereto. As to
any matters not expressly provided for by this Agreement (including, without
limitation, enforcement or collection of the Notes), the Agent shall not be
required to exercise any discretion or take any action, but shall be required to
act or to refrain from acting (and shall be fully protected in so acting or
refraining from acting) upon the instructions of the Majority Banks, and such
instructions shall be binding upon all Banks and all holders of Notes; provided,
however, that the Agent shall not be required to take any action which exposes
the Agent to personal liability or which is contrary to any Loan Document or
applicable law. The Agent agrees to give to each Bank prompt notice of each
notice given to it by the Borrower pursuant to the terms of this Agreement.
SECTION 7.02. Agent's Reliance, Etc. Neither the Agent nor any of its
directors, officers, agents or employees shall be liable for any action taken or
omitted to be taken by it or them under or in connection with this Agreement,
except for its or their own gross negligence or willful misconduct. Without
limitation of the generality of the foregoing, the Agent: (i) may treat the
payee of any Note as the holder thereof until the Agent receives written notice
of the assignment or transfer thereof signed by such payee and including the
agreement of the assignee or transferee to be bound hereby as it would have been
if it had been an original Bank party hereto, in form satisfactory to the Agent;
(ii) may consult with legal counsel (including counsel for the Borrower),
independent public accountants and other experts selected by it and shall not be
liable for any action taken or omitted to be taken in good faith by it in
accordance with the advice of such counsel, accountants or experts; (iii) makes
no warranty or representation to any Bank and shall not be responsible to any
Bank for any statements, warranties or representations (whether written or oral)
made in or in connection with any Loan Document; (iv) shall not have any duty to
ascertain or to inquire as to the performance or observance of any of the terms,
covenants or conditions of any Loan Document on the part of the Borrower or any
Subsidiary of the Borrower or to inspect the property (including the books and
records) of the Borrower or any such Subsidiary; (v) shall not be responsible to
any Bank for the due execution, legality, validity, enforceability, genuineness,
sufficiency or value of any Loan Document or any other instrument or document
furnished pursuant thereto; and (vi) shall incur no liability under or in
respect of any Loan Document by acting upon any notice, consent, certificate or
other instrument or writing (which may be by telecopier, telegram, cable
facsimile or telex) believed by it to be genuine and signed or sent by the
proper party or parties.
SECTION 7.03. Citibank and Affiliates. With respect to its Commitment,
the Advances made by it and the Notes issued to it, Citibank shall have the same
rights and powers under this Agreement as any other Bank and may exercise the
same as though it were not the Agent; and the term "Bank" or "Banks" shall,
unless otherwise expressly indicated, include Citibank in its individual
capacity. Citibank and its Affiliates may accept deposits from, lend money to,
act as
66
72
trustee under indentures of, and generally engage in any kind of business
with, the Borrower, any of its Subsidiaries and any Person who may do business
with or own securities of the Borrower or any such Subsidiary, all as if
Citibank were not the Agent and without any duty to account therefor to the
Banks.
SECTION 7.04. Bank Credit Decision. Each Bank acknowledges that it has,
independently and without reliance upon the Agent or any other Bank and based on
the financial statements referred to in Section 4.01(e) and such other documents
and information as it has deemed appropriate, made its own credit analysis and
decision to enter into this Agreement and the other Loan Documents. Each Bank
also acknowledges that it will, independently and without reliance upon the
Agent or any other Bank and based on such documents and information as it shall
deem appropriate at the time, continue to make its own credit decisions in
taking or not taking action under this Agreement and the other Loan Documents.
SECTION 7.05. Indemnification. The Banks agree to indemnify the Agent
(to the extent not reimbursed by the Borrower), ratably according to the
respective principal amounts of the Committed Rate Advances then held by each of
them (or if no Committed Rate Advances are at the time outstanding ratably
according to the respective amounts of their Commitments), from and against any
and all liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses or disbursements of any kind or nature
whatsoever which may be imposed on, incurred by, or asserted against the Agent
in any way relating to or arising out of this Agreement or any other Loan
Document or any action taken or omitted by the Agent under this Agreement or any
other Loan Document, provided that no Bank shall be liable for any portion of
such liabilities, obligations, losses, damages, penalties, actions, judgments,
suits, costs, expenses or disbursements resulting from the Agent's gross
negligence or willful misconduct. Without limitation of the foregoing, each Bank
agrees to reimburse the Agent promptly upon demand for its ratable share of any
out-of-pocket expenses (including counsel fees) incurred by the Agent in
connection with the preparation, execution, delivery, administration,
modification, amendment or enforcement (whether through negotiations, legal
proceedings or otherwise) of, or legal advice in respect of rights or
responsibilities under, this Agreement to the extent that the Agent is not
reimbursed for such expenses by the Borrower.
SECTION 7.06. Successor Agent. The Agent may resign at any time by
giving written notice thereof to the Banks and the Borrower and the Agent may be
removed at any time with or without cause by the Majority Banks. Upon any such
resignation or removal, in the case of the Agent, the Majority Banks shall have
the right, subject to the approval of the Borrower (which shall not be
unreasonably withheld), to appoint a successor Agent. If no successor Agent
shall have been so appointed by the Majority Banks, and shall have accepted such
appointment, within 30 days after the retiring Agent's giving of notice of
resignation or the Majority Banks' removal of the retiring Agent, then the
retiring Agent may, on behalf of the Banks, appoint a successor Agent, which
shall be a commercial bank organized under the laws of the United States of
America or of any State thereof and having a combined capital and surplus of at
least $100,000,000. Upon the acceptance of any appointment as Agent hereunder by
a successor Agent, such successor Agent shall thereupon succeed to and become
vested with all the rights, powers, privileges and duties of the retiring Agent,
and the retiring Agent shall be discharged
67
73
from its duties and obligations under this Agreement and the other Loan
Documents. After any retiring Agent's resignation or removal hereunder as Agent,
the provisions of this Article VII shall inure to its benefit as to any actions
taken or omitted to be taken by it while it was Agent under this Agreement and
the other Loan Documents.
SECTION 7.07. Documentation Agent. The Documentation Agent, as such,
shall have no duties or obligations whatsoever with respect to this Agreement,
the Notes or any of the other Loan Documents.
ARTICLE VIII
MISCELLANEOUS
SECTION 8.01. Amendments, Etc. No amendment or waiver of any provision
of this Agreement or the Notes or the Loan Documents, nor consent to any
departure by the Borrower therefrom, shall in any event be effective unless the
same shall be in writing and signed by the Majority Banks (or consented to in
writing in the case of the Loan Documents), and then such waiver or consent
shall be effective only in the specific instance and for the specific purpose
for which given; provided, however, that no amendment, waiver or consent shall,
unless in writing and signed by all the Banks, do any of following: (a) waive
any of the conditions specified in Article III, (b) increase the Commitments of
the Banks or subject the Banks to any additional monetary obligations, (c)
reduce the principal of, or interest on, the Committed Rate Advances or the
Committed Rate Notes or any fees or other amounts payable hereunder, (d)
postpone the date fixed for the scheduled payment of principal of, or interest
on, the Committed Rate Advances or the Committed Rate Notes or any fees or other
amounts payable hereunder or waive any such payment when due, (e) change the
percentage of the Commitments or of the aggregate unpaid principal amount of the
Committed Rate Advances or the Committed Rate Notes, or the number or percentage
of Banks, which shall be required for the Banks or any of them to take any
action hereunder or (f) amend this Section 8.01; provided, further, that no
amendment, waiver or consent shall, in writing and signed by the Agent in
addition to the Banks required above to take such action, affect the rights or
duties of the Agent under this Agreement or any Note; and provided also that no
amendment, waiver or consent, unless in writing and signed by the Designated
Bidder holding such Note, affect the rights of the holder of a Competitive Bid
Note under such Note.
SECTION 8.02. Notices, Etc. All notices and other communications
provided for hereunder shall be in writing (including telecopier, telegraphic,
telex or cable communication) and mailed (by certified mail, return receipt
requested), telecopied, telegraphed, telexed, cabled or delivered, if to the
Borrower, at its address at 00 Xxxxxx Xxxxx Xxxx., Xxxxx 000, Xxxxxxxxx, XX
00000, Attention: Xx. Xxxx X. Xxxxxxxx, telecopier no. (000) 000-0000; if to any
Bank, at its Domestic Lending Office as specified in its Administrative Details
Reply Form; and if to the Agent, at its address at 0 Xxxxx Xxxxxx, 0xx Xxxxx,
Zone 0, Xxxx Xxxxxx Xxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Xx. Xxxxxx Xxxxx,
telecopier no. (000) 000-0000; with a copy, in the cases of notices to the Agent
or the Issuing Bank, to Xx. Xxxxxxxx X. Xxxxx, 000 Xxxx Xxxxxx, 0xx Xxxxx, Xxxx
00, Xxx Xxxx, XX 00000; or, as to each Person, at such other address or
68
74
telecopier number as shall be designated by such party in a written notice to
the other parties. All such notices and communications shall, when mailed (by
certified mail, return receipt requested), telecopied, telegraphed, telexed,
cabled, or faxed be effective when deposited in the mails, telecopied, delivered
to the telegraph company, confirmed by telex answerback, delivered to the cable
company or confirmed received in the case of a telecopy or facsimile,
respectively, except that notices and communications to the Agent pursuant to
Article II or VII shall not be effective until received by the Agent.
SECTION 8.03. No Waiver: Remedies. No failure on the part of any Bank
or the Agent to exercise, and no delay in exercising, any right under any Loan
Document shall operate as a waiver thereof; nor shall any single or partial
exercise of any such right preclude any other or further exercise thereof or the
exercise of any other right. The remedies herein provided are cumulative and not
exclusive of any remedies provided by law.
SECTION 8.04. Costs. Expenses and Taxes.
(a) The Borrower agrees to pay the Agent on demand all reasonable costs
and expenses of the Agent in connection with the preparation, negotiation,
approval, execution, delivery, filing, recording, administration, modification
and amendment of the Loan Documents and the other documents to be delivered
under the Loan Documents, including, without limitation, the reasonable fees and
out-of-pocket expenses of special and local counsel for the Agent with respect
thereto and with respect to advising the Agent as to its rights and
responsibilities under the Loan Documents and the other documents to be
delivered hereunder and thereunder. The Borrower further agrees to pay on demand
(i) all costs and expenses, if any, of the Agent or any Bank in connection with
the enforcement (whether through negotiations or legal proceedings, in
bankruptcy, reorganization or other insolvency proceedings or otherwise) of the
Loan Documents and the other documents to be delivered under the Loan Documents,
including, without limitation, reasonable counsel fees and expenses in
connection with the enforcement of rights under this Section 8.04(a), and (ii)
all costs and expenses in connection with appraisals, valuations, audits and
search reports, all insurance and title costs, and all filing and recording fees
required hereby or associated with any enforcement of rights or remedies
specified in clause (i).
(b) If any payment of principal of, or Conversion of, any Eurodollar
Rate Advance or LIBOR Advance is made other than on the last day of an Interest
Period relating to such Advance, as a result of a payment (including, without
limitation, any payment pursuant to Section 2.09) or Conversion pursuant to
Section 2.08 or 2.11 or acceleration of the maturity of the Notes pursuant to
Section 6.01 or for any other reason, the Borrower shall, upon demand by any
Bank (with a copy of such demand to the Agent), pay to the Agent for the account
of such Bank any amounts required to compensate such Bank for any additional
losses (including loss of anticipated profits), costs or expenses which it may
reasonably incur as a result of such payment or Conversion, including, without
limitation, any loss, cost or expense incurred by reason of the liquidation or
reemployment of deposits or other funds acquired by such Bank to fund or
maintain such Advance.
69
75
SECTION 8.05. Right of Set-off. Upon (i) the occurrence and during the
continuance of any Event of Default and (ii) the making of the request or the
granting of the consent specified by Section 6.01 to authorize the Agent to
declare the Notes due and payable pursuant to the provisions of Section 6.01,
each Bank is hereby authorized at any time and from time to time, to the fullest
extent permitted by law, to set off and apply any and all deposits (general or
special, time or demand, provisional or final) at any time held and other
indebtedness at any time owing by such Bank to or for the credit or the account
of the Borrower against any and all of the obligations of the Borrower now or
hereafter existing under any Loan Document to such Bank, whether or not such
Bank shall have made any demand under this Agreement or such Note and although
such obligations may be unmatured. Each Bank agrees promptly to notify the
Borrower after any such set-off and application made by such Bank, provided that
the failure to give such notice shall not affect the validity of such setoff and
application. The rights of each Bank under this Section 8.05 are in addition to
other rights and remedies (including, without limitation, other rights of
set-off) which such Bank may have.
SECTION 8.06. Indemnification. The Borrower agrees to defend, protect,
indemnify and hold harmless the Agent, each Bank and their respective Affiliates
and the directors, officers, employees, attorneys and agents of the Agent, each
Bank and such Affiliates (each of the foregoing being an "Indemnitee" and all of
the foregoing being collectively the "Indemnitees") from and against any and all
claims, actions, damages, liabilities, costs and expenses (including, without
limitation, all fees and disbursements of counsel and environmental consultants
which may be incurred in the investigation or defense of any matter) imposed
upon, incurred by or asserted against any Indemnitee by any third party, whether
direct, indirect or consequential and whether based on any federal, state or
foreign laws or other statutes or regulations (including, without limitation,
securities laws, commercial laws and Environmental Laws and regulations), under
common law or on equitable cause, or on contract, tort or otherwise, including,
without limitation, those arising:
(a) by reason of, relating to or in connection with the
execution, delivery, performance or enforcement of any Loan Document,
any commitments relating thereto, or any transaction contemplated by
any Loan Document; or
(b) in connection with any investigation, litigation,
proceeding or other action relating to any Loan Document (whether or
not any Indemnitee is a party thereto); or
(c) by reason of, relating to or in connection with any credit
extended or used under the Loan Documents or any act done or omitted by
any Person, or any event occurring, in connection therewith, or the
exercise of any rights or remedies thereunder, including, without
limitation, any Environmental Activity or Environmental Law; or
(d) arising out of, related to or in connection with any
acquisition or proposed acquisition (including, without limitation, by
tender offer, merger or other method) by the Borrower or any of its
Subsidiaries or Affiliates of any Facility (or the assets thereof) or
any Related Businesses or any Existing Clinic Acquisition, whether or
not an Indemnitee is a party thereto;
70
76
provided, however, that, notwithstanding the foregoing, the Borrower shall not
be liable to any Indemnitee for any portion of such claims, damages, liabilities
and expenses resulting from such Indemnitee's or such Indemnitee's Affiliate's,
director's, officer's, employee's, attorney's or agent's gross negligence or
willful misconduct. In the event this indemnity is unenforceable as a matter of
law as to a particular matter or consequence referred to herein, it shall be
enforceable to the full extent permitted by law.
This indemnification applies, without limitation, to any act, omission,
event or circumstance existing or occurring on or prior to the date of payment
in full of the Advances, including any Environmental Activity or Environmental
Law, regardless of whether the act, omission, event or circumstance constituted
a violation of any Environmental Law at the time of its existence or occurrence.
The indemnification provisions set forth above shall be in addition to any
liability the Borrower may otherwise have. Without prejudice to the survival of
any other obligation of the Borrower hereunder, the indemnities and obligations
of the Borrower contained in this Section 8.06 shall survive the payment in full
of the Advances.
SECTION 8.07. Binding Effect. This Agreement shall become effective
when it shall have been executed by the Borrower and the Agent and when the
Agent shall have been notified by each Bank that such Bank has executed it and
thereafter shall be binding upon and inure to the benefit of the Borrower, the
Agent and each Bank and their respective successors and assigns, except that the
Borrower shall not have the right to assign its rights hereunder or any interest
herein without the prior written consent of the Banks.
SECTION 8.08. Assignments and Participations.
(a) Each Bank may assign, with the prior consent of the Borrower and
the Agent (which, in either case, shall not be unreasonably withheld), to one or
more banks, financial institutions or other entities all or a portion of its
rights and obligations as a Bank under this Agreement and the other Loan
Documents (including, without limitation, all or a portion of its Commitment,
the Advances owing to it and the Notes held by it in respect of the Committed
Rate Advances); provided, however, that (i) each such assignment shall be of a
constant, and not a varying, percentage of all of the assigning Bank's rights
and obligations under the Loan Documents, (ii) the amount of the Commitments, if
any, of the assigning Bank being assigned pursuant to each such assignment
(determined as of the date of the Assignment and Acceptance with respect to such
assignment) shall in no event be less than $10,000,000, and shall be an integral
multiple of $1,000,000 in excess thereof, or the remaining amount of such Bank's
Commitments, (iii) each such assignment shall be to an Eligible Assignee, and
(iv) the parties to each such assignment shall execute and deliver to the Agent,
for its acceptance and recording in the Register, an Assignment and Acceptance,
together with any Notes subject to such assignment and a processing and
recordation fee of $3,000; provided, further, that each Bank may, without the
consent of the Borrower or the Agent, assign, as collateral or otherwise, any of
its rights under this Agreement and the other Loan Documents (including, without
limitation, the right to payment of principal and interest under the Notes) to
any Federal Reserve Bank, and such assignment of rights to the Federal Reserve
Bank shall not be subject to the conditions and restrictions set forth in items
(i) through (iv) of the immediately foregoing proviso; and provided,
71
77
further, that each Bank may, without the consent of (but with prior written
notice to) the Borrower or the Agent, assign, in whole or in part, any of its
rights and obligations under this Agreement and the other Loan Documents to any
of its Affiliates, and such assignment to Affiliates shall not be subject to the
conditions and restrictions set forth in items (i) through (iv) of the proviso
above. Upon such execution, delivery, acceptance and recording, from and after
the effective date specified in each Assignment and Acceptance, (x) the assignee
thereunder shall be a party hereto and, to the extent that rights and
obligations under the Loan Documents have been assigned to it pursuant to such
Assignment and Acceptance, have the rights and obligations of a Bank hereunder
and thereunder and (y) the Bank assignor thereunder shall, to the extent that
rights and obligations under the Loan Documents have been assigned by it
pursuant to such Assignment and Acceptance, relinquish its rights and be
released from its obligations under the Loan Documents (and, in the case of an
Assignment and Acceptance covering all or the remaining portion of an assigning
Bank's rights and obligations under the Loan Documents, such Bank shall cease to
be a party hereto).
(b) By executing and delivering an Assignment and Acceptance, the Bank
assignor thereunder and the assignee thereunder confirm to and agree with each
other and the other parties hereto as follows: (i) other than as provided in
such Assignment and Acceptance, such assigning Bank makes no representation or
warranty and assumes no responsibility with respect to any statements,
warranties or representations made in or in connection with any Loan Document or
the execution, legality, validity, enforceability, genuineness, sufficiency or
value of any Loan Document or any other instrument or document furnished
pursuant hereto or thereto; (ii) such assigning Bank makes no representation or
warranty and assumes no responsibility with respect to the financial condition
of any Loan Party or the performance or observance by any Loan Party of any of
its obligations under any Loan Document or any other instrument or document
furnished pursuant hereto or thereto; (iii) such assignee confirms that it has
received a copy of each of the Loan Documents, together with copies of the
financial statements referred to in Section 4.01(e) and such other documents and
information as it has deemed appropriate to make its own credit analysis and
decision to enter into such Assignment and Acceptance; (iv) such assignee will,
independently and without reliance upon the Agent, such assigning Bank or any
other Bank and based on such documents and information as it shall deem
appropriate at the time, continue to make its own credit decisions in taking or
not taking action under this Agreement or any other Loan Document; (v) such
assignee confirms that it is an Eligible Assignee; (vi) such assignee appoints
and authorizes the Agent to take such action as agent on its behalf and to
exercise such powers under this Agreement and the other Loan Documents as are
delegated to the Agent by the terms hereof and thereof, together with such
powers as are reasonably incidental thereto; and (vii) such assignee agrees that
it will perform in accordance with their terms all of the obligations which by
the terms of the Loan Documents are required to be performed by it as a Bank.
(c) The Agent shall maintain at its address referred to in Section 8.02
a copy of each Assignment and Acceptance delivered to and accepted by it and a
register for the recordation of the names and addresses of the Banks and the
Commitment and principal amount of the Advances owing to, each Bank from time to
time (the "Register"). The entries in the Register shall be conclusive and
binding for all purposes, absent manifest error, and the Borrower, the
72
78
Agent and the Banks may treat each Person whose name is recorded in the Register
as a Bank hereunder for all purposes of this Agreement. The Register shall be
available for inspection by the Borrower or any Bank at any reasonable time and
from time to time upon reasonable prior notice.
(d) Upon its receipt of an Assignment and Acceptance executed by an
assigning Bank and an assignee representing that it is an Eligible Assignee,
together with any Notes subject to such assignment, the Agent shall, if such
Assignment and Acceptance has been completed and is in substantially the form of
Exhibit E, (i) accept such Assignment and Acceptance, (ii) record the
information contained therein in the Register, and (iii) give prompt notice
thereof to the Borrower. Within five Business Days after its receipt of such
notice, the Borrower, at its own expense, shall execute and deliver to the Agent
in exchange for the surrendered Committed Rate Notes, new Committed Rate Notes
to the order of such Eligible Assignee in an aggregate principal amount equal to
the principal amount of Committed Rate Advances owed to it pursuant to such
Assignment and Acceptance and, if the assigning Bank has retained any principal
amount of Committed Rate Advances hereunder, new Committed Rate Notes to the
order of the assigning Bank in an aggregate principal amount equal to such
principal amount. Such new Committed Rate Notes shall be in an aggregate
principal amount equal to the aggregate principal amount of such surrendered
Committed Rate Notes, shall be dated the effective date of such Assignment and
Acceptance, shall consist of Committed Rate Notes payable to the order of such
Eligible Assignee and, if the assigning Bank has retained ownership of any
Committed Rate Advances hereunder, the assigning Bank in the appropriate
principal amounts, and shall otherwise be in substantially the forms required by
this Agreement.
(e) Each Bank may sell participations to one or more banks or other
entities in or to all or a portion of its rights and obligations under the Loan
Documents (including, without limitation, all or a portion of its Commitments,
the Notes held by it and reimbursement obligations of the Borrower in respect of
Letters of Credit); provided, however, that (i) such Bank's obligations under
the Loan Documents (including, without limitation, its Commitments to the
Borrower hereunder) shall remain unchanged, (ii) such Bank shall remain solely
responsible to the other parties hereto for the performance of such obligations,
(iii) such Bank shall remain the holder of any such Notes for all purposes of
the Loan Documents, and (iv) the Borrower, the Agent and the other Banks shall
continue to deal solely and directly with such Bank in connection with such
Bank's rights and obligations under the Loan Documents; provided, further, that,
to the extent of any such participation (unless otherwise stated therein and
subject to the preceding proviso), the assignee or purchaser of such
participation shall, to the fullest extent permitted by law, have the same
rights and benefits hereunder as it would have if it were a Bank hereunder; and
provided, further, that each such participation shall be granted pursuant to an
agreement providing that the purchaser thereof shall not have the right to
consent or object to any action by the selling Bank (who shall retain such
right) other than an action which would (i) reduce principal of or interest on
any Advance or fees in which such purchaser has an interest or (ii) postpone any
date fixed for payment of principal of or interest on any such Advance or such
fees.
73
79
(f) The Borrower agrees that any Bank purchasing a participation from
another Bank pursuant to Section 2.14 or 8.08(e) may, to the fullest extent
permitted by law, exercise all its rights of payment (including the right of
set-off) with respect to such participation as fully as if such Bank were the
direct creditor of the Borrower in the amount of such participation.
(g) Notwithstanding any other provision of this Section 8.08, each
Designated Bidder may assign to one or more Eligible Assignees any Competitive
Bid Note.
SECTION 8.09. Headings. Article and Section headings in this Agreement
are included for convenience of reference only and shall not constitute a part
of this Agreement for any other purpose.
SECTION 8.10. Confidentiality. Neither the Agent nor any Bank shall
disclose to any third party any Confidential Information disclosed to the Agent
or such Bank pursuant to the Loan Documents, except that (i) the Agent or any
Bank may disclose Confidential Information to a third party to the extent
compelled by law, subpoena, civil investigative demand, interrogatory or similar
legal process or by any rule, regulation or request of any regulatory authority
having jurisdiction over the Agent or such Bank, as the case may be, (ii) the
Agent or any Bank may disclose Confidential Information to a potential
transferee who is an Eligible Assignee, provided that such potential transferee
agrees to be bound by the same confidentiality obligations as the Banks under
this Section and (iii) the Agent or any Bank may disclose Confidential
Information to its affiliates or its legal counsel or other agents provided that
prior to any such disclosure the Agent or such Bank, as the case may be, informs
such affiliates, counsel or agent of the confidential nature of such
Confidential Information. For purposes hereof, "Confidential Information" is
written information disclosed by the Borrower or any of its Subsidiaries to the
Agent or any Bank pursuant hereto that is not information which (x) has become
generally available to the public, other than as a result of disclosure by the
Agent or such Bank, (y) was available on a non-confidential basis prior to its
disclosure to the Agent or such Bank by the Borrower or any of its Subsidiaries,
or (z) becomes available to the Agent or such Bank on a non-confidential basis
from a source other than the Borrower or any of its Subsidiaries. The Agent and
the Banks acknowledge that the Confidential Information may from time to time
include material non-public information relating to the Borrower or its
Subsidiaries.
SECTION 8.11. Severability of Provisions. Each provision of this
Agreement will be interpreted in such manner as to be effective and valid under
applicable law, but if any provision of this Agreement is held to be prohibited
or unenforceable in any jurisdiction, such provision shall, as to such
jurisdiction, be ineffective only to the extent of such prohibition or
unenforceability without invalidating the remainder of such provision or the
remaining provisions hereof or affecting the validity or enforceability of such
provision in any other jurisdiction.
SECTION 8.12. Independence of Provisions. All agreements and covenants
hereunder and under the Loan Documents shall be given independent effect such
that if a particular action or condition is prohibited by the terms of any such
agreement or covenant, the fact that such
74
80
action or condition would be permitted within the limitations of another
agreement or covenant shall not be construed as allowing such action to be taken
or condition to exist.
SECTION 8.13. Consent to Jurisdiction.
(a) The Borrower hereby irrevocably submits to the jurisdiction of any
New York State or Federal court sitting in New York City in any action or
proceeding arising out of or relating to this Agreement or any Loan Document,
and the Borrower hereby irrevocably agrees that all claims in respect of such
action or proceeding may be heard and determined in such New York State or
Federal court. The Borrower hereby irrevocably waives, to the fullest extent it
may effectively do so, the defense of an inconvenient forum to the maintenance
of such action or proceeding. The Borrower hereby irrevocably appoints CT
Corporation System (the "Process Agent"), with an office on the date hereof at
0000 Xxxxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Xxxxxx Xxxxxx, as its agent to receive
on behalf of the Borrower and its property service of copies of the summons and
complaint and any other process which may be served in any such action or
proceeding. Such service may be made by mailing or delivering a copy of such
process to the Borrower in care of the Process Agent at the Process Agent's
above address, and the Borrower hereby irrevocably authorizes and directs the
Process Agent to accept such service on his behalf. As an alternative method of
service, the Borrower also irrevocably consents to the service of any and all
process in any such action or proceeding by the mailing of copies of such
process to the Borrower at its address specified in Section 8.02. The Borrower
agrees that a final judgment in any such action or proceeding shall be
conclusive and may be enforced in other jurisdictions by suit on the judgment or
in any other manner provided by law.
(b) Nothing in this section shall affect the right of any Bank or the
Agent to serve legal process in any other manner permitted by law or affect the
right of any Bank or the Agent to bring any action or proceeding against the
Borrower or its property in the courts of any other jurisdictions.
SECTION 8.14. GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK WITHOUT
REFERENCE TO PRINCIPLES OF CONFLICT OF LAWS THAT WOULD RESULT IN THE APPLICATION
OF ANY OTHER LAW.
SECTION 8.15. WAIVER OF JURY TRIAL. EACH OF THE BORROWER, THE AGENT,
THE ISSUING BANK AND THE BANKS HEREBY IRREVOCABLY WAIVES ALL RIGHT TO TRIAL BY
JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM ARISING OUT' OF OR RELATING TO
ANY OF THE LOAN DOCUMENTS OR THE TRANSACTIONS CONTEMPLATED THEREBY.
SECTION 8.16. Execution in Counterparts. This Agreement may be executed
in any number of counterparts and by different parties hereto in separate
counterparts, each of which when so executed shall be deemed to be an original
and all of which taken together shall constitute one and the same agreement.
75
81
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their respective officers thereunto duly authorized, as of the date
first above written.
THE BORROWER
PHYCOR, INC.
By
-----------------------------------
Name:
Title:
THE AGENT
CITIBANK, N.A.,
as Agent
By
------------------------------------
Name:
Title:
76
82
THE DOCUMENTATION AGENT
NATIONSBANK, N.A.,
as Documentation Agent
By
-----------------------------------
Name:
Title:
77
83
Commitment: THE BANKS
Commitment: $12,750,000.00 CITIBANK, N.A.
By
-----------------------------------
Name:
Title:
Commitment: $ 3,750,000.00 AMSOUTH BANK
By
-----------------------------------
Name:
Title:
Commitment: $ 5,625,000.00 BANK OF AMERICA ILLINOIS
By
-----------------------------------
Name:
Title:
Commitment: $10,125,000.00 THE BANK OF NOVA SCOTIA
By
-----------------------------------
Name:
Title:
Commitment: $ 5,625,000.00 BANKERS TRUST COMPANY
By
-----------------------------------
Name:
Title:
78
84
Commitment: $3,750,000.00 COOPERATIEVE CENTRALE
RAIFFEISEN-BOERENLEENBANK B.A.,
"RABOBANK NEDERLAND"
By
-----------------------------------
Name:
Title:
Commitment: $7,500,000.00 CORESTATES BANK, N.A.
By
-----------------------------------
Name:
Title:
Commitment: $7,500,000.00 CREDIT LYONNAIS NEW YORK BRANCH
By
-----------------------------------
Name:
Title:
Commitment: $7,500,000.00 DEUTSCHE BANK AG, NEW YORK AND/OR
CAYMAN ISLANDS BRANCHES
By
-----------------------------------
Name:
Title:
By
-----------------------------------
Name:
Title:
Commitment: $9,375,000.00 FIRST AMERICAN NATIONAL BANK
By
-----------------------------------
Name:
Title:
79
85
Commitment: $ 3,750,000.00 THE FIRST NATIONAL BANK OF CHICAGO
By
-----------------------------------
Name:
Title:
Commitment: $10,125,000.00 FIRST UNION NATIONAL BANK
By
-----------------------------------
Name:
Title:
Commitment: $ 3,750,000.00 THE FUJI BANK, LIMITED
By
-----------------------------------
Name:
Title:
Commitment: $ 9,375,000.00 MELLON BANK, N.A.
By
-----------------------------------
Name:
Title:
Commitment: $11,250,000.00 NATIONSBANK, N.A.
By
-----------------------------------
Name:
Title:
Commitment: $ 7,500,000.00 PNC BANK, KENTUCKY, INC.
By
-----------------------------------
Name:
Title:
80
86
Commitment: $ 7,500,000.00 THE SUMITOMO BANK, LIMITED
By
-----------------------------------
Name:
Title:
Commitment: $ 10,125,000.00 SUNTRUST BANK, NASHVILLE, N.A.
By
-----------------------------------
Name:
Title:
Commitment: $ 9,375,000.00 TORONTO DOMINION (TEXAS), INC.
By
-----------------------------------
Name:
Title:
Commitment: $ 3,750,000.00 UNION BANK OF SWITZERLAND, NEW YORK
BRANCH
By
-----------------------------------
Name:
Title:
Total Commitments: $150,000,000
81
