Exhibit 10.18
SECOND AMENDMENT TO CREDIT AGREEMENT
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THIS SECOND AMENDMENT TO CREDIT AGREEMENT is made and dated as of
February 28, 1995 (the "Amendment") among Community Psychiatric Centers, a
Nevada corporation ("CPC"), Transitional Hospitals Corporation, a Delaware
corporation ("THC"), and BANK OF AMERICA NATIONAL TRUST AND SAVINGS ASSOCIATION,
a United States national banking association ("Bank") and amends that certain
Credit Agreement dated as of May 6, 1994 and by a First Amendment to Credit
Agreement dated as of December 14, 1994 (as so amended or modified from time to
time, the "Credit Agreement").
RECITALS
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WHEREAS, the Company has requested, and the Bank has agreed, on the
terms and conditions set forth herein, to amend the Credit Agreement to extend
the Termination Date and revise the pricing of credit extensions thereunder;
NOW, THEREFORE, for good and valuable consideration, the receipt and
adequacy of which are hereby acknowledged, the parties hereby agree as follows:
1. Terms. All terms used herein shall have the same meanings as in the
Credit Agreement unless otherwise defined herein. All references to the Credit
Agreement shall mean the Credit Agreement as hereby amended.
2. Amendment to Credit Agreement.
2.1 Section 1.01 of the Credit Agreement is amended as follows:
(a) The definition of "Termination Date" is amended by
deleting "February 28, 1995" and inserting "February 28, 1996" in lieu thereof.
(b) The definition of "Applicable Margin" is hereby amend and
restated as follows:
"`Applicable Margin' means
(i) with respect to Base Rate to Base Rate Loans, the
Base Rate Increment; and
(ii) with respect to Offshore Rate Loans, the Offshore
Rate Increment."
(c) The following definitions are hereby added to Section 1.01
to appear in alphabetical order therein:
"`Base Rate Increment' means the percentage per annum
determined pursuant to subsection 2.08(a).
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"`Offshore Rate Increment' means the percentage per annum
determined pursuant to subsection 2.08(a)."
2.2 Section 2.08 of the Credit Agreement is hereby amended and
restated as follows:
"(a) Each Loan shall bear interest on the outstanding
principal amount thereof from the date when made at a rate per annum
equal to the Offshore Rate or the Base Rate, as the case may be,
plus the Applicable Margin. The Base Rate Increment and the Offshore
Rate Increment shall be automatically adjusted to the rates in the
table immediately following which rates shall correspond to the Net
Funded Debt to EBITDA Ratio shown on the most recent Compliance
Certificate. Each such automatic adjustment shall be effective from
the fifteenth (15th) day following the due date of each Compliance
Certificate and shall remain effective through the fourteenth (14th)
day following the due date of the next Compliance Certificate.
Offshore
Base Rate Rate
Net Funded Debt to EBITDA Ratio Increment Increment
------------------------------- --------- ---------
Greater than 2.00 to 1.00 0.75% 2.00%
Greater than 1.50 to 1.00 but
not greater than 2.00 to 1.00 0.50% 1.75%
Greater than 1.00 to 1.00 but
not greater than 1.50 to 1.00 0.25% 1.50%
Greater than 0.50 to 1.00 but
not greater than 1.00 to 1.00 0.00% 1.25%
Not greater than 0.50 to 1.00 0.00% 1.00%"
3. Representations and Warranties. Company represents and warrants
to Bank that, on and as of the date hereof, and after giving effect to this
Amendment:
3.1 Authorization. The execution, delivery and performance of this
Amendment have been duly authorized by all necessary corporate action by the
Company and this Amendment has been duly executed and delivered by the Company.
3.2 Binding Obligation. This Amendment is the legal, valid and
binding obligation of Company, enforceable against the Company in accordance
with its terms.
3.3 No Legal Obstacle to Credit Agreement. The execution, delivery
and performance of this Amendment will not (a) contravene the terms of the
Company's certificate of incorporation, by-laws or other organization document;
(b) conflict with or result in any breach or contravention of the
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provisions of any contract to which the Company is a party, or the violation of
any law, judgment, decree or governmental order, rule or regulation applicable
to Company, or (c) result in the creation under any agreement or instrument of
any security interest, lien, charge, or encumbrance upon any of the assets of
the Company. No approval or authorization of any governmental authority is
required to permit the execution, delivery or performance by the Company of
this Amendment, or the transactions contemplated hereby.
3.4 Incorporation of Certain Representations. The representations and
warranties of the Company set forth in Section 5 of the Credit Agreement are
true and correct in all respects on and as of the date hereof as though made on
and as of the date hereof.
3.5 Default. No Default or Event of Default under the Credit Agreement
has occurred and is continuing.
4. Conditions, Effectiveness. The effectiveness of this Amendment
shall be subject to the compliance by the Company with its agreements herein
contained, and to the delivery of the following to the Bank in form and
substance satisfactory to the Bank:
4.1 Authorized Signatories. A certificate, signed by the Secretary or
an Assistant Secretary of Company and dated the date of this Amendment, as to
the incumbency of the person or persons authorized to execute and deliver this
Amendment and any instrument or agreement required hereunder on behalf of
Company.
4.2 Other Evidence. Such other evidence with respect to the Company or
any other person as the Bank may reasonably request in connection with this
Amendment and the compliance with the conditions set forth herein.
5. Miscellaneous.
5.1 Effectiveness of the Credit Agreement and the Loan Documents.
Except as hereby expressly amended, the Credit Agreement and each other Loan
Document shall each remain in full force and effect, and are hereby ratified and
confirmed in all respects on and as of the date hereof.
5.2 Waivers. This Amendment is limited solely to the matters expressly
set forth herein and is specific in time and in intent and does not constitute,
nor should it be construed as, a waiver or amendment of any other term or
condition, right, power or privilege under the Credit Agreement, the Loan
Documents, or under any agreement, contract, indenture, document or instrument
mentioned therein; nor does it preclude or prejudice any rights of the Bank
thereunder, or any exercise thereof or the exercise of any other right, power or
privilege, nor shall it require the Bank to agree to an amendment, waiver or
consent for a similar transaction or on a future occasion, nor shall any future
waiver of any right, power, privilege or default hereunder, or under any
agreement, contract, indenture, document or instrument mentioned in the Credit
Agreement, constitute a waiver of any other default of the same or of any other
term or provision.
5.3 Counterparts. This Amendment may be executed in any number of
counterparts and all of such counterparts taken together shall be deemed to
constitute one and the same instrument. This Amendment shall not become
effective until the Company and the Bank shall have signed a copy hereof,
whether the same or counterparts, and the same shall have been delivered to the
Bank.
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5.4 Jurisdiction. This Amendment shall be governed by and construed
under the laws of the State of California.
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
duly executed and delivered as of the date first written above.
COMMUNITY PSYCHIATRIC CENTERS
By: /s/ Xxxxxxx Xxxxx
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Name: XXXXXXX XXXXX
Title: CEO/CHAIRMAN
TRANSITIONAL HOSPITALS CORPORATION
By: /s/ Xxxxx Xxxxxxx
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Name: XXXXX XXXXXXX
Title: CFO
BANK OF AMERICA NATIONAL TRUST AND
SAVINGS ASSOCIATION
By: /s/ Xxxxx X. Xxxxxxx
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Name: XXXXX X. XXXXXXX
Title: VICE PRESIDENT
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CONSENT OF GUARANTORS
The undersigned Guarantors hereby acknowledge that they have reviewed and
consent to the foregoing Second Amendment dated as of February 28, 1995 to
Credit Agreement dated as of May 6, 1994, and hereby reaffirm their respective
General Continuing General Guaranties, which continue in full force and effect
on and as of the date hereof.
Date: February 28, 1995
EACH OF THE GUARANTORS LISTED
ON ANNEX A HERETO,
INCORPORATED BY REFERENCE
HEREIN
By: /s/ Xxxxxxx Xxxxx
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Title: CHIEF EXECUTIVE OFFICER
By: /s/ Xxxxx Xxxxxxx
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Title: CHIEF FINANCIAL OFFICER
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