Exhibit 10.1
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AMENDED AND RESTATED CREDIT AGREEMENT
DATED AS OF DECEMBER 21, 2004
AMONG
PSYCHIATRIC SOLUTIONS, INC.
AS THE BORROWER,
THE SUBSIDIARIES OF THE BORROWER IDENTIFIED HEREIN,
AS THE GUARANTORS,
BANK OF AMERICA, N.A.,
AS ADMINISTRATIVE AGENT, SWING LINE LENDER AND L/C ISSUER,
XXXXXXX XXXXX & CO., XXXXXXX LYNCH, PIERCE, XXXXXX & XXXXX
INCORPORATED
AND
CITICORP USA, INC.,
AS CO-SYNDICATION AGENTS,
JPMORGAN CHASE BANK, N.A.,
AS DOCUMENTATION AGENT
AND
THE OTHER LENDERS PARTY HERETO
ARRANGED BY:
BANC OF AMERICA SECURITIES LLC,
AS SOLE LEAD ARRANGER AND SOLE BOOK MANAGER
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TABLE OF CONTENTS
ARTICLE I DEFINITIONS AND ACCOUNTING TERMS..................................................................... 1
1.01 Defined Terms.............................................................................. 1
1.02 Other Interpretive Provisions.............................................................. 24
1.03 Accounting Terms........................................................................... 24
1.04 Rounding................................................................................... 25
1.05 References to Agreements and Laws.......................................................... 25
1.06 Times of Day............................................................................... 25
1.07 Letter of Credit Amounts................................................................... 25
ARTICLE II THE COMMITMENTS AND CREDIT EXTENSIONS............................................................... 25
2.01 Revolving Loans............................................................................ 25
2.02 Borrowings, Conversions and Continuations of Loans......................................... 26
2.03 Letters of Credit.......................................................................... 27
2.04 Swing Line Loans........................................................................... 33
2.05 Prepayments................................................................................ 36
2.06 Termination or Reduction of Aggregate Revolving Commitments................................ 37
2.07 Repayment of Loans......................................................................... 37
2.08 Interest................................................................................... 37
2.09 Fees....................................................................................... 38
2.10 Computation of Interest and Fees........................................................... 38
2.11 Evidence of Debt........................................................................... 38
2.12 Payments Generally......................................................................... 39
2.13 Sharing of Payments........................................................................ 40
ARTICLE III TAXES, YIELD PROTECTION AND ILLEGALITY............................................................. 41
3.01 Taxes...................................................................................... 41
3.02 Illegality................................................................................. 42
3.03 Inability to Determine Rates............................................................... 42
3.04 Increased Cost and Reduced Return; Capital Adequacy........................................ 43
3.05 Funding Losses............................................................................. 43
3.06 Matters Applicable to all Requests for Compensation........................................ 44
3.07 Survival................................................................................... 44
ARTICLE IV GUARANTY............................................................................................ 44
4.01 The Guaranty............................................................................... 44
4.02 Obligations Unconditional.................................................................. 45
4.03 Reinstatement.............................................................................. 46
4.04 Certain Additional Waivers................................................................. 46
4.05 Remedies................................................................................... 46
4.06 Rights of Contribution..................................................................... 46
4.07 Guarantee of Payment; Continuing Guarantee................................................. 46
ARTICLE V CONDITIONS PRECEDENT TO CREDIT EXTENSIONS............................................................ 47
5.01 Conditions of Initial Credit Extension..................................................... 47
5.02 Conditions to all Credit Extensions........................................................ 49
ARTICLE VI REPRESENTATIONS AND WARRANTIES...................................................................... 50
6.01 Existence, Qualification and Power......................................................... 50
6.02 Authorization; No Contravention............................................................ 50
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6.03 Governmental Authorization; Other Consents................................................. 50
6.04 Binding Effect............................................................................. 50
6.05 Financial Statements; No Material Adverse Effect........................................... 50
6.06 Litigation................................................................................. 51
6.07 No Default................................................................................. 51
6.08 Ownership of Property; Liens............................................................... 51
6.09 Environmental Compliance................................................................... 52
6.10 Insurance.................................................................................. 52
6.11 Taxes...................................................................................... 53
6.12 ERISA Compliance........................................................................... 53
6.13 Subsidiaries............................................................................... 53
6.14 Margin Regulations; Investment Company Act; Public Utility Holding Company Act............. 53
6.15 Disclosure................................................................................. 54
6.16 Compliance with Laws....................................................................... 54
6.17 Intellectual Property; Licenses, Etc....................................................... 55
6.18 Broker's Fees.............................................................................. 55
6.19 Labor Matters.............................................................................. 55
6.20 Business Locations......................................................................... 55
6.21 Perfection of Security Interests in the Collateral......................................... 56
6.22 Subordination.............................................................................. 56
6.23 Fraud and Abuse............................................................................ 56
6.24 Licensing and Accreditation................................................................ 56
ARTICLE VII AFFIRMATIVE COVENANTS.............................................................................. 57
7.01 Financial Statements....................................................................... 57
7.02 Certificates; Other Information............................................................ 58
7.03 Notices.................................................................................... 59
7.04 Payment of Obligations..................................................................... 60
7.05 Preservation of Existence, Etc............................................................. 60
7.06 Maintenance of Properties.................................................................. 61
7.07 Maintenance of Insurance................................................................... 61
7.08 Compliance with Laws....................................................................... 61
7.09 Books and Records.......................................................................... 62
7.10 Inspection Rights.......................................................................... 62
7.11 Use of Proceeds............................................................................ 62
7.12 Additional Subsidiaries.................................................................... 63
7.13 ERISA Compliance........................................................................... 63
7.14 Pledged Assets............................................................................. 63
7.15 Post-Closing Matters....................................................................... 64
ARTICLE VIII NEGATIVE COVENANTS................................................................................ 65
8.01 Liens...................................................................................... 65
8.02 Investments................................................................................ 66
8.03 Indebtedness............................................................................... 67
8.04 Fundamental Changes........................................................................ 68
8.05 Dispositions............................................................................... 68
8.06 Restricted Payments........................................................................ 69
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8.07 Change in Nature of Business............................................................... 69
8.08 Transactions with Affiliates and Insiders.................................................. 69
8.09 Burdensome Agreements...................................................................... 70
8.10 Use of Proceeds............................................................................ 70
8.11 Financial Covenants........................................................................ 70
8.12 Prepayment of Other Indebtedness, Etc...................................................... 71
8.13 Organization Documents; Fiscal Year; Legal Name, State of Formation and Form of Entity..... 71
8.14 Ownership of Subsidiaries.................................................................. 71
8.15 Sale and Leaseback Transactions............................................................ 71
ARTICLE IX EVENTS OF DEFAULT AND REMEDIES...................................................................... 72
9.01 Events of Default.......................................................................... 72
9.02 Remedies Upon Event of Default............................................................. 74
9.03 Application of Funds....................................................................... 74
ARTICLE X ADMINISTRATIVE AGENT................................................................................. 75
10.01 Appointment and Authorization of Administrative Agent............................ 75
10.02 Delegation of Duties............................................................. 76
10.03 Liability of Administrative Agent................................................ 76
10.04 Reliance by Administrative Agent................................................. 76
10.05 Notice of Default................................................................ 77
10.06 Credit Decision; Disclosure of Information by Administrative Agent............... 77
10.07 Indemnification of Administrative Agent.......................................... 78
10.08 Administrative Agent in its Individual Capacity.................................. 78
10.09 Successor Administrative Agent................................................... 78
10.10 Administrative Agent May File Proofs of Claim.................................... 79
10.11 Collateral and Guaranty Matters.................................................. 79
10.12 Other Agents; Arrangers and Managers............................................. 80
ARTICLE XI MISCELLANEOUS....................................................................................... 80
11.01 Amendments, Etc.................................................................. 80
11.02 Notices and Other Communications; Facsimile Copies............................... 81
11.03 No Waiver; Cumulative Remedies................................................... 83
11.04 Attorney Costs, Expenses and Taxes............................................... 83
11.05 Indemnification by the Borrower.................................................. 83
11.06 Payments Set Aside............................................................... 84
11.07 Successors and Assigns........................................................... 84
11.08 Confidentiality.................................................................. 86
11.09 Set-off.......................................................................... 87
11.10 Interest Rate Limitation......................................................... 87
11.11 Counterparts..................................................................... 88
11.12 Integration...................................................................... 88
11.13 Survival of Representations and Warranties....................................... 88
11.14 Severability..................................................................... 88
11.15 Tax Forms........................................................................ 88
11.16 Replacement of Lenders........................................................... 90
11.17 Governing Law.................................................................... 90
11.18 Waiver of Right to Trial by Jury................................................. 91
11.19 Designated Senior Indebtedness................................................... 91
11.20 Collateral and Guaranty Matters.................................................. 91
11.21 USA Patriot Act Notice........................................................... 92
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SCHEDULES
2.01 Commitments and Pro Rata Shares
6.13 Subsidiaries
6.17 IP Rights
6.20(a) Locations of Real Property
6.20(b) Locations of Tangible Personal Property
6.20(c) Locations of Chief Executive Office
6.20(e) Changes in Legal Name, State of Formation and Structure
8.01 Liens Existing on the Closing Date
8.02 Investments Existing on the Closing Date
8.03 Indebtedness Existing on the Closing Date
11.02 Certain Addresses for Notices
EXHIBITS
A Form of Loan Notice
B Form of Swing Line Loan Notice
C-1 Form of Revolving Note
C-2 Form of Swing Line Note
D Form of Compliance Certificate
E Form of Assignment and Assumption
F Form of Joinder Agreement
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AMENDED AND RESTATED CREDIT AGREEMENT
This AMENDED AND RESTATED CREDIT AGREEMENT is entered into as of December
21, 2004 among PSYCHIATRIC SOLUTIONS, INC., a Delaware corporation (the
"Borrower"), the Guarantors (defined herein), the Lenders (defined herein) and
BANK OF AMERICA, N.A., as Administrative Agent, Swing Line Lender and L/C
Issuer.
The Borrower has requested that the Lenders provide a revolving credit
facility of up to $150 million for the purposes set forth herein and the Lenders
are willing to do so on the terms and conditions set forth herein; and
WHEREAS, this Credit Agreement is given in amendment to, restatement of
and substitution for the Credit Agreement dated as of January 6, 2004 among the
Borrower, the Guarantors, the lenders identified therein and Bank of America, as
administrative agent.
In consideration of the mutual covenants and agreements herein contained,
the parties hereto covenant and agree as follows:
ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS
1.01 DEFINED TERMS.
As used in this Agreement, the following terms shall have the meanings set
forth below:
"2003 Equity Offering" means the public offering of the common stock of
the Borrower consummated in December 2003 pursuant to which the Borrower
received cash proceeds of approximately $50 million.
"2004 Equity Offering" means the public offering of the common stock of
the Borrower consummated in December 2004 pursuant to which the Borrower
received cash proceeds of approximately $105 million.
"Acquisition", by any Person, means the acquisition by such Person, in a
single transaction or in a series of related transactions, of all or any
substantial portion of the Property of another Person or at least a majority of
the Voting Stock of another Person, in each case whether or not involving a
merger or consolidation with such other Person and whether for cash, property,
services, assumption of Indebtedness, securities or otherwise.
"Administrative Agent" means Bank of America in its capacity as
administrative agent under any of the Loan Documents, or any successor
administrative agent.
"Administrative Agent's Office" means the Administrative Agent's address
and, as appropriate, account as set forth on Schedule 11.02 or such other
address or account as the Administrative Agent may from time to time notify the
Borrower and the Lenders.
"Administrative Questionnaire" means an Administrative Questionnaire in a
form supplied by the Administrative Agent.
"Affiliate" means, with respect to any Person, another Person that
directly, or indirectly through one or more intermediaries, Controls or is
Controlled by or is under common Control with the Person specified. "Control"
means the possession, directly or indirectly, of the power to direct or cause
the direction of the management or policies of a Person, whether through the
ability to exercise voting power, by contract or otherwise. "Controlling" and
"Controlled" have meanings correlative thereto. Without limiting the generality
of the foregoing, a Person shall be deemed to be Controlled by another Person if
such other Person possesses, directly or indirectly, power to vote 5% or more of
the securities having ordinary voting power for the election of directors,
managing general partners or the equivalent.
"Agent-Related Persons" means the Administrative Agent, together with its
Affiliates (including, in the case of Bank of America in its capacity as the
Administrative Agent, the Arranger), and the officers, directors, employees,
agents and attorneys-in-fact of such Persons and Affiliates.
"Aggregate Revolving Commitments" means the Revolving Commitments of all
the Lenders. The amount of the Aggregate Revolving Commitments in effect on the
Closing Date is ONE HUNDRED FIFTY MILLION DOLLARS ($150,000,000).
"Agreement" means this Credit Agreement, as amended, modified,
supplemented and extended from time to time.
"Applicable Rate" means the following percentages per annum, based upon
the Consolidated Senior Leverage Ratio as set forth in the most recent
Compliance Certificate received by the Administrative Agent pursuant to Section
7.02(b):
Pricing Consolidated Total Leverage Eurodollar Rate Loans and Letter of Base Rate Commitment
Tier Ratio Credit Fee Loans Fee
---- ----- ---------- ----- ---
I > or = 4.0:1.0 2.50% 1.00% 0.50%
II <4.0:1.0 but > or = 3.5:1.0 2.00% 0.50% 0.50%
III < 3.5:1.0 but > or = 3.0:1 1.75% 0.25% 0.50%
IV < 3.0:1.0 1.50% 0.00% 0.50%
Any increase or decrease in the Applicable Rate resulting from a change in the
Consolidated Senior Leverage Ratio shall become effective as of the date five
(5) Business Days immediately following the date a Compliance Certificate is
delivered pursuant to Section 7.02(b); provided, however, that if a Compliance
Certificate is not delivered when due in accordance with such Section, then
Pricing Tier I shall apply as of the first Business Day after the date on which
such Compliance Certificate was required to have been delivered and shall
continue to apply until the date five (5) Business Days immediately following
the date such Compliance Certificate is actually delivered. The Applicable Rate
in effect from the Closing Date through the first Business Day immediately
following the date a Compliance Certificate is delivered pursuant to Section
7.02(b) for the fiscal quarter ending December 31, 2004 shall be determined
based upon Pricing Tier IV.
"Approved Fund" means any Fund that is administered or managed by (a) a
Lender, (b) an Affiliate of a Lender or (c) an entity or an Affiliate of an
entity that administers or manages a Lender.
"Arranger" means Banc of America Securities LLC, in its capacity as sole
lead arranger and sole book manager.
"Assignment and Assumption" means an Assignment and Assumption
substantially in the form of Exhibit E.
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"Attorney Costs" means and includes all fees, expenses and disbursements
of any law firm or other external counsel.
"Attributable Indebtedness" means, on any date, (a) in respect of any
capital lease of any Person, the capitalized amount thereof that would appear on
a balance sheet of such Person prepared as of such date in accordance with GAAP,
(b) in respect of any Synthetic Lease, the capitalized amount of the remaining
lease payments under the relevant lease that would appear on a balance sheet of
such Person prepared as of such date in accordance with GAAP if such lease were
accounted for as a capital lease, (c) in respect of any Securitization
Transaction of any Person, the outstanding principal amount of such financing,
after taking into account reserve accounts and making appropriate adjustments,
determined by the Administrative Agent in its reasonable judgment, and (d) in
the case of any Sale and Leaseback Transaction, the present value (discounted in
accordance with GAAP at the debt rate implied in the applicable lease) of the
obligations of the lessee for rental payments during the term of such lease).
"Audited Financial Statements" means the audited consolidated balance
sheet of the Borrower and its Subsidiaries for the fiscal year ended December
31, 2003, and the related consolidated statements of income or operations,
shareholders' equity and cash flows of the Borrower and its Subsidiaries for
such fiscal year, including the notes thereto.
"Availability Period" means, with respect to the Revolving Commitments,
the period from and including the Closing Date to the earliest of (a) the
Maturity Date, (b) the date of termination of the Aggregate Revolving
Commitments pursuant to Section 2.06, and (c) the date of termination of the
commitment of each Lender to make Loans and of the obligation of the L/C Issuer
to make L/C Credit Extensions pursuant to Section 9.02.
"Bank of America" means Bank of America, N.A. and its successors.
"Base Rate" means for any day a fluctuating rate per annum equal to the
higher of (a) the Federal Funds Rate plus 1/2 of 1% or (b) the rate of interest
in effect for such day as publicly announced from time to time by Bank of
America as its "prime rate." The "prime rate" is a rate set by Bank of America
based upon various factors including Bank of America's costs and desired return,
general economic conditions and other factors, and is used as a reference point
for pricing some loans, which may be priced at, above, or below such announced
rate. Any change in the "prime rate" announced by Bank of America shall take
effect at the opening of business on the day specified in the public
announcement of such change.
"Base Rate Loan" means a Loan that bears interest based on the Base Rate.
"Borrower" has the meaning specified in the introductory paragraph hereto.
"Borrowing" means a borrowing consisting of simultaneous Loans of the same
Type and, in the case of Eurodollar Rate Loans, having the same Interest Period
made by each of the Lenders pursuant to Section 2.01.
"Business Day" means any day other than a Saturday, Sunday or other day on
which commercial banks are authorized to close under the Laws of, or are in fact
closed in, the state where the Administrative Agent's Office is located and, if
such day relates to any Eurodollar Rate Loan, means any such day on which
dealings in Dollar deposits are conducted by and between banks in the London
interbank eurodollar market.
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"Businesses" means, at any time, a collective reference to the businesses
operated by the Borrower and its Subsidiaries at such time.
"Capital Stock" means (i) in the case of a corporation, capital stock,
(ii) in the case of an association or business entity, any and all shares,
interests, participations, rights or other equivalents (however designated) of
capital stock, (iii) in the case of a partnership, partnership interests
(whether general or limited), (iv) in the case of a limited liability company,
membership interests and (v) any other interest or participation that confers on
a Person the right to receive a share of the profits and losses of, or
distributions of assets of, the issuing Person.
"Cash Collateralize" has the meaning specified in Section 2.03(g).
"Cash Equivalents" means, as at any date, (a) securities issued or
directly and fully guaranteed or insured by the United States or any agency or
instrumentality thereof (provided that the full faith and credit of the United
States is pledged in support thereof) having maturities of not more than twelve
months from the date of acquisition, (b) Dollar denominated time deposits and
certificates of deposit of (i) any Lender, (ii) any domestic commercial bank of
recognized standing having capital and surplus in excess of $500,000,000 or
(iii) any bank whose short-term commercial paper rating from S&P is at least A-1
or the equivalent thereof or from Xxxxx'x is at least P-1 or the equivalent
thereof (any such bank being an "Approved Bank"), in each case with maturities
of not more than 270 days from the date of acquisition, (c) commercial paper and
variable or fixed rate notes issued by any Approved Bank (or by the parent
company thereof) or any variable rate notes issued by, or guaranteed by, any
domestic corporation rated A-1 (or the equivalent thereof) or better by S&P or
P-1 (or the equivalent thereof) or better by Moody's and maturing within six
months of the date of acquisition, (d) repurchase agreements entered into by any
Person with a bank or trust company (including any of the Lenders) or recognized
securities dealer having capital and surplus in excess of $500,000,000 for
direct obligations issued by or fully guaranteed by the United States in which
such Person shall have a perfected first priority security interest (subject to
no other Liens) and having, on the date of purchase thereof, a fair market value
of at least 100% of the amount of the repurchase obligations, (e) debt
obligations issued by any domestic corporation or any domestic government
instrumentality, in each case rated A-1 (or the equivalent thereof) or better by
S&P or P-1 (or the equivalent thereof) or better by Moody's and maturing within
six months of the date of acquisition and (f) Investments, classified in
accordance with GAAP as current assets, in money market investment programs
registered under the Investment Company Act of 1940, as amended, which are
administered by reputable financial institutions having capital of at least
$500,000,000 and the portfolios of which are limited to Investments of the
character described in the foregoing subdivisions (a) through (e).
"Change of Control" means an event or series of events by which:
(a) any "person" or "group" (as such terms are used in Sections
13(d) and 14(d) of the Securities Exchange Act of 1934, but excluding any
employee benefit plan of such person or its subsidiaries, and any person
or entity acting in its capacity as trustee, agent or other fiduciary or
administrator of any such plan) becomes the "beneficial owner" (as defined
in Rules 13d-3 and 13d-5 under the Securities Exchange Act of 1934, except
that a person or group shall be deemed to have "beneficial ownership" of
all Capital Stock that such person or group has the right to acquire (such
right, an "option right"), whether such right is exercisable immediately
or only after the passage of time), directly or indirectly, of twenty-five
percent (25%) of the Capital Stock of the Borrower entitled to vote for
members of the board of directors or equivalent governing body of the
Borrower on a fully diluted basis (and taking into account all such
securities that such person or group has the right to acquire pursuant to
any option right); or
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(b) during any period of 24 consecutive months, a majority of the
members of the board of directors or other equivalent governing body of
the Borrower cease to be composed of individuals (i) who were members of
that board or equivalent governing body on the first day of such period,
(ii) whose election or nomination to that board or equivalent governing
body was approved by individuals referred to in clause (i) above
constituting at the time of such election or nomination at least a
majority of that board or equivalent governing body or (iii) whose
election or nomination to that board or other equivalent governing body
was approved by individuals referred to in clauses (i) and (ii) above
constituting at the time of such election or nomination at least a
majority of that board or equivalent governing body (excluding, in the
case of both clause (ii) and clause (iii), any individual whose initial
nomination for, or assumption of office as, a member of that board or
equivalent governing body occurs as a result of an actual or threatened
solicitation of proxies or consents for the election or removal of one or
more directors by any person or group other than a solicitation for the
election of one or more directors by or on behalf of the board of
directors); or
(c) a "Change of Control" (or any comparable term) occurs under, and
as defined in, any of the Senior Subordinated Notes Documents; or
(d) a "Liquidation" occurs under, and as defined in, the Certificate
of Designations, Preferences and Rights of Series A Convertible Preferred
Stock, as amended, of the Borrower.
"Closing Date" means the date hereof.
"CMS" means the Centers for Medicare and Medicaid Services of HHS and any
successor thereof and any predecessor thereof, including the United States
Health Care Financing Administration.
"Collateral" means a collective reference to all real and personal
Property with respect to which Liens in favor of the Administrative Agent are
purported to be granted pursuant to and in accordance with the terms of the
Collateral Documents.
"Collateral Documents" means a collective reference to the Security
Agreement, Pledge Agreement, the Mortgages and such other security documents as
may be executed and delivered by the Loan Parties pursuant to the terms of
Section 7.14.
"Compliance Certificate" means a certificate substantially in the form of
Exhibit D.
"Consolidated Adjusted EBITDA" means, for any period for the Borrower and
its Subsidiaries on a consolidated basis, an amount equal to the sum of (a)
Consolidated EBITDA for such period plus (b) rent and lease expense for such
period minus (c) Consolidated Maintenance Capital Expenditures for such period
minus (d) taxes paid in cash during such period, all as determined in accordance
with GAAP.
"Consolidated EBITDA" means, for any period for the Borrower and its
Subsidiaries on a consolidated basis, an amount equal to Consolidated Net Income
for such period plus the following to the extent deducted in calculating such
Consolidated Net Income: (a) Consolidated Interest Charges for such period, (b)
the provision for federal, state, local and foreign income taxes payable by the
Borrower and its Subsidiaries for such period, (c) the amount of depreciation
and amortization expense for such period, (d) loss on refinancing of long term
debt incurred during the twelve month period ending on (and including) the
Closing Date and (e) non-cash, non-recurring expenses and charges in an
aggregate amount of up to $3 million, all as determined in accordance with GAAP.
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"Consolidated Fixed Charges" means, for any period for the Borrower and
its Subsidiaries on a consolidated basis, an amount equal to the sum of (i) the
cash portion of Consolidated Interest Charges for such period plus (ii)
Consolidated Scheduled Funded Debt Payments for such period plus (iii) rent and
lease expense for such period plus (iv) the amount of all payments on Earn-Out
Obligations during such period, all as determined in accordance with GAAP.
"Consolidated Fixed Charges Coverage Ratio" means, as of any date of
determination, the ratio of (i) Consolidated Adjusted EBITDA for the period of
the four fiscal quarters most recently ended to (ii) Consolidated Fixed Charges
for the period of the four fiscal quarters most recently ended.
"Consolidated Funded Indebtedness" means Funded Indebtedness of the
Borrower and its Subsidiaries on a consolidated basis determined in accordance
with GAAP.
"Consolidated Growth Capital Expenditures" means, for any period, for the
Borrower and its Subsidiaries on a consolidated basis, all capital expenditures,
as determined in accordance with GAAP, other than (a) Consolidated Maintenance
Capital Expenditures, (b) any expenditures made with proceeds of any Involuntary
Disposition to the extent such expenditures are used to purchase Property that
is the same as or similar to the Property subject to such Involuntary
Disposition and (c) Acquisitions consummated prior to the Closing Date and
Permitted Acquisitions consummated after the Closing Date.
"Consolidated Interest Charges" means, for any period for the Borrower and
its Subsidiaries on a consolidated basis, all interest expense of the Borrower
and its Subsidiaries for such period determined in accordance with GAAP
(including, without limitation, the portion of rent expense of the Borrower and
its Subsidiaries with respect to such period under capital leases that is
treated as interest in accordance with GAAP).
"Consolidated Maintenance Capital Expenditures" means, for any period, for
the Borrower and its Subsidiaries on a consolidated basis, all maintenance
capital expenditures, as determined in accordance with GAAP, other than any
expenditures made with proceeds of any Involuntary Disposition to the extent
such expenditures are used to purchase Property that is the same as or similar
to the Property subject to such Involuntary Disposition.
"Consolidated Net Income" means, for any period for the Borrower and its
Subsidiaries on a consolidated basis, the net income of the Borrower and its
Subsidiaries for such period as determined in accordance with GAAP, but
excluding for all purposes (other than the calculation of Consolidated Net
Income for purposes of Section 8.11(d)) extraordinary gains and related tax
effects thereon.
"Consolidated Net Worth" means, as of any date of determination,
consolidated shareholders' equity of the Borrower and its Subsidiaries as of
such date determined in accordance with GAAP.
"Consolidated Scheduled Funded Debt Payments" means, for any period for
the Borrower and its Subsidiaries on a consolidated basis, the sum of all
scheduled payments of principal on Consolidated Funded Indebtedness, as
determined in accordance with GAAP. For purposes of this definition, "scheduled
payments of principal" (a) shall be determined without giving effect to any
reduction of such scheduled payments resulting from the application of any
voluntary or mandatory prepayments made during the applicable period, (b) shall
be deemed to include the Attributable Indebtedness in respect of capital leases,
Synthetic Leases and Sale and Leaseback Transactions and (c) shall not include
any voluntary prepayments or mandatory prepayments required pursuant to Section
2.05.
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"Consolidated Senior Leverage Ratio" means, as of any date of
determination, the ratio of (a) Consolidated Funded Indebtedness (other than the
Senior Subordinated Notes) as of such date to (b) Consolidated EBITDA for the
period of the four fiscal quarters most recently ended.
"Consolidated Total Leverage Ratio" means, as of any date of
determination, the ratio of (a) the sum of (i) Consolidated Funded Indebtedness
as of such date minus (ii) if positive, the sum of (A) the aggregate amount of
cash and Cash Equivalents of the Borrower and its Subsidiaries on such date
minus (B) the aggregate amount of Loans outstanding on such date to (b)
Consolidated EBITDA for the period of the four fiscal quarters most recently
ended.
"Contract Provider" means any Person or any employee, agent or
subcontractor of such Person who provides professional health care services
under or pursuant to any contract with the Borrower or any Subsidiary.
"Contractual Obligation" means, as to any Person, any provision of any
security issued by such Person or of any agreement, instrument or other
undertaking to which such Person is a party or by which it or any of its
Property is bound.
"Control" has the meaning specified in the definition of "Affiliate."
"Credit Extension" means each of the following: (a) a Borrowing and (b) a
L/C Credit Extension.
"Debtor Relief Laws" means the Bankruptcy Code of the United States, and
all other liquidation, conservatorship, bankruptcy, assignment for the benefit
of creditors, moratorium, rearrangement, receivership, insolvency,
reorganization, or similar debtor relief Laws of the United States or other
applicable jurisdictions from time to time in effect and affecting the rights of
creditors generally.
"Default" means any event or condition that constitutes an Event of
Default or that, with the giving of any notice, the passage of time, or both,
would be an Event of Default.
"Default Rate" means an interest rate equal to (a) the Base Rate plus (b)
the Applicable Rate, if any, applicable to Base Rate Loans plus (c) 2% per
annum; provided, however, that with respect to a Eurodollar Rate Loan, the
Default Rate shall be an interest rate equal to the interest rate (including any
Applicable Rate) otherwise applicable to such Loan plus 2% per annum, in each
case to the fullest extent permitted by applicable Laws.
"Defaulting Lender" means any Lender that (a) has failed to fund any
portion of the Loans participations in L/C Obligations or participations in
Swing Line Loans required to be funded by it hereunder within one Business Day
of the date required to be funded by it hereunder, (b) has otherwise failed to
pay over to the Administrative Agent or any other Lender any other amount
required to be paid by it hereunder within one Business Day of the date when
due, unless the subject of a good faith dispute, or (c) has been deemed
insolvent or become the subject of a bankruptcy or insolvency proceeding.
"Disposition" or "Dispose" means the sale, transfer, license, lease or
other disposition (including any Sale and Leaseback Transaction) of any Property
by the Borrower or any Subsidiary (including the Capital Stock of any
Subsidiary), including any sale, assignment, transfer or other disposal, with or
without recourse, of any notes or accounts receivable or any rights and claims
associated therewith, but excluding (a) the sale, lease, license, transfer or
other disposition of inventory in the ordinary course of business of the
Borrower and its Subsidiaries, (b) the sale, lease, license, transfer or other
disposition of machinery and equipment no longer used or useful in the conduct
of business of the Borrower and its Subsidiaries, (c) any sale, lease, license,
transfer or other disposition of Property by the Borrower or any
7
Subsidiary to any Loan Party, (d) any Involuntary Disposition by the Borrower or
any Subsidiary and (e) any sale, lease, license, transfer or other disposition
of Property by any Foreign Subsidiary to another Foreign Subsidiary.
"Dollar" and "$" mean lawful money of the United States.
"Domestic Subsidiary" means any Subsidiary that is organized under the
laws of any political subdivision of the United States.
"Earn-Out Obligations" means, with respect to any Acquisition, all
deferred purchase price obligations (including, without limitation, earn-out
payment obligations and other contingent payment obligations) incurred by the
Borrower and any of its Subsidiaries pursuant to the documentation for such
Acquisition (other than any portion of such obligations payable in Capital Stock
of the Borrower). For purposes of Section 8.03, the amount of any "Earn-Out
Obligation" shall be the liability in respect thereof as recorded on the balance
sheet of the Borrower and its Subsidiaries in accordance with GAAP.
"Eligible Assignee" means (a) a Lender; (b) an Affiliate of a Lender; (c)
an Approved Fund; and (d) any other Person (other than a natural person)
approved by (i) the Administrative Agent, the L/C Issuer and the Swing Line
Lender, and (ii) unless an Event of Default has occurred and is continuing, the
Borrower (each such approval not to be unreasonably withheld or delayed);
provided that notwithstanding the foregoing, "Eligible Assignee" shall not
include the Borrower or any of the Borrower's Affiliates or Subsidiaries.
"Environmental Laws" means any and all federal, state, local, foreign and
other applicable statutes, laws, regulations, ordinances, rules, judgments,
orders, decrees, permits, concessions, grants, franchises, licenses, agreements
or governmental restrictions relating to pollution and the protection of the
environment or the release of any materials into the environment, including
those related to hazardous substances or wastes, air emissions and discharges to
waste or public systems.
"Environmental Liability" means any liability, contingent or otherwise
(including any liability for damages, costs of environmental remediation, fines,
penalties or indemnities), of the Borrower or any Subsidiary directly or
indirectly resulting from or based upon (a) violation of any Environmental Law,
(b) the generation, use, handling, transportation, storage, treatment or
disposal of any Hazardous Materials, (c) exposure to any Hazardous Materials,
(d) the release or threatened release of any Hazardous Materials into the
environment or (e) any contract, agreement or other consensual arrangement
pursuant to which liability is assumed or imposed with respect to any of the
foregoing.
"Equity Issuance" means any issuance by the Borrower or any Subsidiary to
any Person of shares of its Capital Stock, other than (a) any issuance of shares
of its Capital Stock pursuant to the exercise of options or warrants, (b) any
issuance of shares of its Capital Stock pursuant to the conversion of any debt
securities to equity or the conversion of any class equity securities to any
other class of equity securities and (c) any issuance by the Borrower of shares
of its Capital Stock as consideration for a Permitted Acquisition. The term
"Equity Issuance" shall not be deemed to include any Disposition.
"ERISA" means the Employee Retirement Income Security Act of 1974.
"ERISA Affiliate" means any trade or business (whether or not
incorporated) under common control with the Borrower within the meaning of
Section 414(b) or (c) of the Internal Revenue Code (and Sections 414(m) and (o)
of the Internal Revenue Code for purposes of provisions relating to Section 412
of the Internal Revenue Code).
8
"ERISA Event" means (a) a Reportable Event with respect to a Pension Plan;
(b) a withdrawal by the Borrower or any ERISA Affiliate from a Pension Plan
subject to Section 4063 of ERISA during a plan year in which it was a
substantial employer (as defined in Section 4001(a)(2) of ERISA) or a cessation
of operations that is treated as such a withdrawal under Section 4062(e) of
ERISA; (c) a complete or partial withdrawal by the Borrower or any ERISA
Affiliate from a Multiemployer Plan or notification that a Multiemployer Plan is
in reorganization; (d) the filing of a notice of intent to terminate, the
treatment of a Plan amendment as a termination under Sections 4041 or 4041A of
ERISA, or the commencement of proceedings by the PBGC to terminate a Pension
Plan or Multiemployer Plan; (e) an event or condition which constitutes grounds
under Section 4042 of ERISA for the termination of, or the appointment of a
trustee to administer, any Pension Plan or Multiemployer Plan; or (f) the
imposition of any liability under Title IV of ERISA, other than for PBGC
premiums due but not delinquent under Section 4007 of ERISA, upon the Borrower
or any ERISA Affiliate.
"Eurodollar Base Rate" means, for any Interest Period with respect to any
Eurodollar Rate Loan:
(a) the rate per annum equal to the rate determined by the
Administrative Agent to be the offered rate that appears on the page of
the Telerate screen (or any successor thereto) that displays an average
British Bankers Association Interest Settlement Rate for deposits in
Dollars (for delivery on the first day of such Interest Period) with a
term equivalent to such Interest Period, determined as of approximately
11:00 a.m. (London time) two Business Days prior to the first day of such
Interest Period, or
(b) if the rate referenced in the preceding clause (a) does not
appear on such page or service or such page or service shall not be
available, the rate per annum equal to the rate determined by the
Administrative Agent to be the offered rate on such other page or other
service that displays an average British Bankers Association Interest
Settlement Rate for deposits in Dollars (for delivery on the first day of
such Interest Period) with a term equivalent to such Interest Period,
determined as of approximately 11:00 a.m. (London time) two Business Days
prior to the first day of such Interest Period, or
(c) if the rates referenced in the preceding clauses (a) and (b) are
not available, the rate per annum (rounded upward to the next 1/100th of
1%) determined by the Administrative Agent as the rate of interest at
which deposits in Dollars for delivery on the first day of such Interest
Period in same day funds in the approximate amount of the Eurodollar Rate
Loan being made, continued or converted by Bank of America and with a term
equivalent to such Interest Period would be offered by Bank of America's
London Branch to major banks in the London interbank eurodollar market at
their request at approximately 4:00 p.m. (London time) two Business Days
prior to the first day of such Interest Period.
"Eurodollar Rate" means for any Interest Period with respect to any
Eurodollar Rate Loan, a rate per annum determined by the Administrative Agent to
be equal to the quotient obtained by dividing (a) the Eurodollar Base Rate for
such Eurodollar Loan for such Interest Period by (b) one minus the Eurodollar
Reserve Percentage for such Eurodollar Loan for such Interest Period.
"Eurodollar Rate Loan" means a Loan that bears interest at a rate based on
the Eurodollar Rate.
"Eurodollar Reserve Percentage" means, for any day during any Interest
Period, the reserve percentage (expressed as a decimal, carried out to five
decimal places) in effect on such day, whether or not applicable to any Lender,
under regulations issued from time to time by the FRB for determining the
maximum reserve requirement (including any emergency, supplemental or other
marginal reserve requirement) with respect to Eurocurrency funding (currently
referred to as "Eurocurrency liabilities").
9
The Eurodollar Rate for each outstanding Eurodollar Rate Loan shall be adjusted
automatically as of the effective date of any change in the Eurodollar Reserve
Percentage.
"Event of Default" has the meaning specified in Section 9.01.
"Excluded Property" means, with respect to any Loan Party (a) any owned
real Property that has a fair market value of less than $2,500,000 unless
requested by the Administrative Agent or the Required Lenders, (b) any leased
real Property unless requested by the Administrative Agent or the Required
Lenders, (c) any owned or leased real or personal Property which is located
outside of the United States unless requested by the Administrative Agent or the
Required Lenders, (d) any leased personal Property unless requested by the
Administrative Agent or the Required Lenders, (e) any personal Property
(including, without limitation, motor vehicles) in respect of which perfection
of a Lien is not either (i) governed by the Uniform Commercial Code or (ii)
effected by appropriate evidence of the Lien being filed in either the United
States Copyright Office or the United States Patent and Trademark Office, unless
requested by the Administrative Agent or the Required Lenders, (f) any Property
which, subject to the terms of Section 8.09, is subject to a Lien of the type
described in Section 8.01(i) pursuant to documents which prohibit such Loan
Party from granting any other Liens in such Property and (g) any lease, license
or other contract if the grant of a security interest in such lease, license or
contract is prohibited by the terms of such lease, license or contract or by law
and would result in the termination of such lease, license or contract, but only
to the extent that (i) after reasonable efforts, consent from the relevant party
or parties has not been obtained and (ii) any such prohibition could not be
rendered ineffective pursuant to the UCC or any other applicable law (including
Debtor Relief Laws) or principles of equity.
"Excluded Subsidiaries" means, collectively, PSI Surety and the HUD
Financing Subsidiaries.
"Exclusion Event" means an event or events resulting in the exclusion of
the Borrower or any Subsidiary or any of the Facilities from participation in
any Medical Reimbursement Program.
"Facilities" means, at any time, a collective reference to the facilities
and real properties owned, leased, managed or operated by the Borrower or any
Subsidiary.
"Federal Funds Rate" means, for any day, the rate per annum equal to the
weighted average of the rates on overnight federal funds transactions with
members of the Federal Reserve System arranged by federal funds brokers on such
day, as published by the Federal Reserve Bank on the Business Day next
succeeding such day; provided that (a) if such day is not a Business Day, the
Federal Funds Rate for such day shall be such rate on such transactions on the
next preceding Business Day as so published on the next succeeding Business Day,
and (b) if no such rate is so published on such next succeeding Business Day,
the Federal Funds Rate for such day shall be the average rate (rounded upward,
if necessary, to a whole multiple of 1/100 of 1%) charged to Bank of America on
such day on such transactions as determined by the Administrative Agent.
"Fee Letter" means the letter agreement dated as of December 3, 2004 among
the Borrower, the Administrative Agent and the Arranger.
"Fixed Assets" means, as of any date of determination, plant, property and
equipment of the Borrower and its Subsidiaries on a consolidated basis on such
day as determined in accordance with GAAP.
"Foreign Lender" has the meaning specified in Section 11.15(a)(i).
"Foreign Subsidiary" means any Subsidiary that is not a Domestic
Subsidiary.
10
"FRB" means the Board of Governors of the Federal Reserve System of the
United States.
"Fund" means any Person (other than a natural person) that is (or will be)
engaged in making, purchasing, holding or otherwise investing in commercial
loans and similar extensions of credit in the ordinary course of its business.
"Funded Indebtedness" means, as to any Person at a particular time,
without duplication, all of the following, whether or not included as
indebtedness or liabilities in accordance with GAAP:
(a) all obligations for borrowed money, whether current or long-term
(including the Obligations) and all obligations of such Person evidenced
by bonds, debentures, notes, loan agreements or other similar instruments;
(b) all purchase money indebtedness;
(c) the principal portion of all obligations under conditional sale
or other title retention agreements relating to Property purchased by such
Person (other than customary reservations or retentions of title under
agreements with suppliers entered into in the ordinary course of
business);
(d) the maximum amount available to be drawn under letters of credit
(including standby and commercial), bankers' acceptances, bank guaranties,
surety bonds and similar instruments;
(e) all obligations in respect of the deferred purchase price of
Property or services (other than trade accounts payable in the ordinary
course of business);
(f) Attributable Indebtedness in respect of capital leases,
Synthetic Leases, Sale and Leaseback Transactions and Securitization
Transactions;
(g) all preferred stock or other equity interests providing for
mandatory redemptions, sinking fund or like payments prior to the Maturity
Date ("Redeemable Stock"); provided that Redeemable Stock shall not
include (i) the Series A Convertible Preferred Stock of the Borrower,
provided that (A) an event giving rise to a mandatory redemption shall
also be a "Change of Control" and (B) the holders thereof shall have
consented to the provisions of Section 8.06 or (ii) any other preferred or
other equity interest subject to mandatory redemption if (A) such
mandatory redemption may be satisfied by delivering common stock or some
other equity interest not subject to mandatory redemption or (B) such
mandatory redemption is triggered solely by reason of a "change of
control" and is not required to be paid until after the Obligations are
paid in full;
(h) all Funded Indebtedness of others to the extent secured by (or
for which the holder of such Funded Indebtedness has an existing right,
contingent or otherwise, to be secured by) any Lien on, or payable out of
the proceeds of production from, Property owned or acquired by such
Person, whether or not the obligations secured thereby have been assumed;
(i) all Guarantees with respect to Funded Indebtedness of the types
specified in clauses (a) through (h) above of another Person; and
11
(j) all Funded Indebtedness of the types referred to in clauses (a)
through (i) above of any partnership or joint venture (other than a joint
venture that is itself a corporation or limited liability company) in
which such Person is a general partner or joint venturer, unless such
Funded Indebtedness is expressly made non-recourse to such Person.
"GAAP" means generally accepted accounting principles in the United States
set forth in the opinions and pronouncements of the Accounting Principles Board
and the American Institute of Certified Public Accountants and statements and
pronouncements of the Financial Accounting Standards Board, consistently applied
and as in effect from time to time.
"Governmental Authority" means any nation or government, any state or
other political subdivision thereof, any agency, authority, instrumentality,
regulatory body, court, administrative tribunal, central bank or other entity
exercising executive, legislative, judicial, taxing, regulatory or
administrative powers or functions of or pertaining to government.
"Governmental Reimbursement Program Cost" means with respect to and
payable by the Borrower and its Subsidiaries the sum of:
(a) all amounts (including punitive and other similar amounts)
agreed to be paid or payable (i) in settlement of claims or (ii) as a
result of a final, non-appealable judgment, award or similar order, in
each case, relating to participation in Medical Reimbursement Programs;
(b) all final, non-appealable fines, penalties, forfeitures or other
amounts rendered pursuant to criminal indictments or other criminal
proceedings relating to participation in Medical Reimbursement Programs;
and
(c) the amount of final, non-appealable recovery, damages, awards,
penalties, forfeitures or similar amounts rendered in any litigation,
suit, arbitration, investigation, review or other legal or administrative
proceeding of any kind relating to participation in Medical Reimbursement
Programs.
"Guarantee" means, as to any Person, (a) any obligation, contingent or
otherwise, of such Person guaranteeing or having the economic effect of
guaranteeing any Indebtedness or other obligation payable or performable by
another Person (the "primary obligor") in any manner, whether directly or
indirectly, and including any obligation of such Person, direct or indirect, (i)
to purchase or pay (or advance or supply funds for the purchase or payment of)
such Indebtedness or other obligation, (ii) to purchase or lease property,
securities or services for the purpose of assuring the obligee in respect of
such Indebtedness or other obligation of the payment or performance of such
Indebtedness or other obligation, (iii) to maintain working capital, equity
capital or any other financial statement condition or liquidity or level of
income or cash flow of the primary obligor so as to enable the primary obligor
to pay such Indebtedness or other obligation, or (iv) entered into for the
purpose of assuring in any other manner the obligee in respect of such
Indebtedness or other obligation of the payment or performance thereof or to
protect such obligee against loss in respect thereof (in whole or in part), or
(b) any Lien on any assets of such Person securing any Indebtedness or other
obligation of any other Person, whether or not such Indebtedness or other
obligation is assumed by such Person. The amount of any Guarantee shall be
deemed to be an amount equal to the stated or determinable amount of the related
primary obligation, or portion thereof, in respect of which such Guarantee is
made or, if not stated or determinable, the maximum reasonably anticipated
liability in respect thereof as determined by the guaranteeing Person in good
faith. The term "Guarantee" as a verb has a corresponding meaning.
12
"Guaranty" means the Guaranty made by the Guarantors in favor of the
Administrative Agent and the Lenders pursuant to Article IV.
"Guarantors" means each Person identified as a "Guarantor" on the
signature pages hereto and each other Person that joins as a Guarantor pursuant
to Section 7.12, together with their successors and permitted assigns.
"Hazardous Materials" means all explosive or radioactive substances or
wastes and all hazardous or toxic substances, wastes or other pollutants,
including petroleum or petroleum distillates, asbestos or asbestos-containing
materials, polychlorinated biphenyls, radon gas, infectious or medical wastes
and all other substances or wastes of any nature regulated pursuant to any
Environmental Law.
"HHS" means the United States Department of Health and Human Services and
any successor thereof.
"Honor Date" has the meaning set forth in Section 2.03(c)(i).
"HIPAA" means the Health Insurance Portability and Accountability Act of
1996, Pub. L. 104-191, Aug. 21, 1996, 110 Stat. 1936.
"HUD Financing" means Indebtedness of HUD Financing Subsidiaries that is
insured by the Federal Housing Administration, an organizational unit of the
United States Department of Housing and Urban Development.
"HUD Financing Subsidiaries" means each of the following Subsidiaries so
long as the documents governing the HUD Financing prohibit such Subsidiaries
from becoming Guarantors: Xxxxx Xxxx Real Estate, LLC, a North Carolina limited
liability company, PSI Cedar Springs Hospital Real Estate, Inc., a Colorado
corporation, Psychiatric Solutions of Oklahoma Real Estate, Inc., an Oklahoma
corporation, Riveredge Real Estate, Inc., an Illinois corporation, Cypress Creek
Real Estate, L.P., a Texas limited partnership, Neuro Rehab Real Estate, L.P., a
Texas limited partnership, Texas Xxxxxx Xxxxx Hospital Real Estate, L.P., a
Texas limited partnership, Texas Oaks Psychiatric Hospital Real Estate, L.P., a
Texas limited partnership, Texas San Marcos Treatment Center Real Estate, L.P.,
a Texas limited partnership, and West Oaks Real Estate, L.P., a Texas limited
partnership.
"Immaterial Subsidiary" means any Subsidiary that, as of any date of
determination, has total assets with an aggregate fair market value of less than
$10,000.
"Indebtedness" means, as to any Person at a particular time, without
duplication, all of the following, whether or not included as indebtedness or
liabilities in accordance with GAAP:
(a) all Funded Indebtedness;
(b) the Swap Termination Value of any Swap Contract;
(c) all Guarantees with respect to outstanding Indebtedness of the
types specified in clauses (a) and (b) above of any other Person; and
(d) all Indebtedness of the types referred to in clauses (a) through
(c) above of any partnership or joint venture (other than a joint venture
that is itself a corporation or limited liability company) in which such
Person is a general partner or joint venturer unless such Indebtedness is
expressly made non-recourse to such Person.
13
"Indemnified Liabilities" has the meaning set forth in Section 11.05.
"Indemnitees" has the meaning set forth in Section 11.05.
"Interest Payment Date" means (a) as to any Eurodollar Rate Loan, the last
day of each Interest Period applicable to such Eurodollar Rate Loan and the
Maturity Date; provided, however, that if any Interest Period for a Eurodollar
Rate Loan exceeds three months, the respective dates that fall every three
months after the beginning of such Interest Period shall also be Interest
Payment Dates; and (b) as to any Base Rate Loan and any Swing Line Loan, the
last Business Day of each March, June, September and December and the Maturity
Date.
"Interest Period" means, as to each Eurodollar Rate Loan, the period
commencing on the date such Eurodollar Rate Loan is disbursed or converted to or
continued as a Eurodollar Rate Loan and ending on the date one, two, three or
six months thereafter, as selected by the Borrower in its Loan Notice; provided
that:
(i) any Interest Period that would otherwise end on a day that is
not a Business Day shall be extended to the next succeeding Business Day
unless such Business Day falls in another calendar month, in which case
such Interest Period shall end on the next preceding Business Day;
(ii) any Interest Period that begins on the last Business Day of a
calendar month (or on a day for which there is no numerically
corresponding day in the calendar month at the end of such Interest
Period) shall end on the last Business Day of the calendar month at the
end of such Interest Period; and
(iii) no Interest Period shall extend beyond the Maturity Date.
"Interim Financial Statements" means the unaudited consolidated financial
statements of the Borrower and its Subsidiaries dated September 30, 2004 and the
related consolidated statements of income or operations, shareholders' equity
and cash flows for the fiscal quarter ended on that date.
"Internal Revenue Code" means the Internal Revenue Code of 1986.
"Investment" means, as to any Person, any direct or indirect acquisition
or investment by such Person, whether by means of (a) the purchase or other
acquisition of Capital Stock of another Person, (b) a loan, advance or capital
contribution to, Guarantee or assumption of debt of, or purchase or other
acquisition of any other debt or equity participation or interest in, another
Person, including any partnership or joint venture interest in such other
Person, or (c) an Acquisition. For purposes of covenant compliance, the amount
of any Investment shall be the amount actually invested, without adjustment for
subsequent increases or decreases in the value of such Investment.
"Involuntary Disposition" means any loss of, damage to or destruction of,
or any condemnation or other taking for public use of, any Property of the
Borrower or any Subsidiary.
"IP Rights" has the meaning set forth in Section 6.17.
"IRS" means the United States Internal Revenue Service.
"ISP98" has the meaning set forth in Section 2.03(h).
14
"Joinder Agreement" means a joinder agreement substantially in the form of
Exhibit F executed and delivered by a Domestic Subsidiary in accordance with the
provisions of Section 7.12.
"Laws" means, collectively, all international, foreign, federal, state and
local statutes, treaties, rules, guidelines, regulations, ordinances, codes and
administrative or judicial precedents or authorities, including the
interpretation or administration thereof by any Governmental Authority charged
with the enforcement, interpretation or administration thereof, and all
applicable administrative orders, directed duties, requests, licenses,
authorizations and permits of, and agreements with, any Governmental Authority,
in each case whether or not having the force of law.
"L/C Advance" means, with respect to each Lender, such Lender's funding of
its participation in any L/C Borrowing in accordance with its Pro Rata Share.
"L/C Borrowing" means an extension of credit resulting from a drawing
under any Letter of Credit which has not been reimbursed on the date when made
or refinanced as a Borrowing of Revolving Loans.
"L/C Credit Extension" means, with respect to any Letter of Credit, the
issuance thereof or extension of the expiry date thereof, or the renewal or
increase of the amount thereof.
"L/C Issuer" means Bank of America in its capacity as issuer of Letters of
Credit hereunder, or any successor issuer of Letters of Credit hereunder.
"L/C Obligations" means, as at any date of determination, the aggregate
undrawn amount of all outstanding Letters of Credit plus the aggregate of all
Unreimbursed Amounts, including all L/C Borrowings. For all purposes of this
Agreement, if on any date of determination a Letter of Credit has expired by its
terms but any amount may still be drawn thereunder by reason of the operation of
Rule 3.14 of the ISP98, such Letter of Credit shall be deemed to be
"outstanding" in the amount so remaining available to be drawn.
"Lender" means each Person identified as a "Lender" on the signature pages
hereto and its successors and assigns and, as the context requires, includes the
L/C Issuer and the Swing Line Lender.
"Lending Office" means, as to any Lender, the office or offices of such
Lender described as such in such Lender's Administrative Questionnaire, or such
other office or offices as a Lender may from time to time notify the Borrower
and the Administrative Agent.
"Letter of Credit" means any standby letter of credit issued hereunder.
"Letter of Credit Application" means an application and agreement for the
issuance or amendment of a letter of credit in the form from time to time in use
by the L/C Issuer.
"Letter of Credit Expiration Date" means the day that is thirty days prior
to the Maturity Date then in effect (or, if such day is not a Business Day, the
next preceding Business Day).
"Letter of Credit Sublimit" means an amount equal to the lesser of the
Aggregate Revolving Commitments and $5,000,000. The Letter of Credit Sublimit is
part of, and not in addition to, the Aggregate Revolving Commitments.
"Lien" means any mortgage, pledge, hypothecation, collateral assignment,
deposit arrangement, encumbrance, lien (statutory or other), charge, or
preference, priority or other security interest or
15
preferential arrangement of any kind or nature whatsoever (including any
conditional sale or other title retention agreement, and any financing lease
having substantially the same economic effect as any of the foregoing).
"Loan" means an extension of credit by a Lender to the Borrower under
Article II in the form of a Revolving Loan or a Swing Line Loan.
"Loan Documents" means this Agreement, each Note, each Letter of Credit,
each Letter of Credit Application, each Joinder Agreement, the Collateral
Documents, each Request for Credit Extension, each Compliance Certificate, the
Fee Letter and each other document, instrument or agreement from time to time
executed by the Borrower or any Subsidiary or any Responsible Officer thereof
and delivered in connection with this Agreement.
"Loan Notice" means a notice of (a) a Borrowing of Revolving Loans, (b) a
conversion of Loans from one Type to the other, or (c) a continuation of
Eurodollar Rate Loans, pursuant to Section 2.02(a), which, if in writing, shall
be substantially in the form of Exhibit A.
"Loan Parties" means, collectively, the Borrower and each Guarantor.
"Material Adverse Effect" means (a) a material adverse change in, or a
material adverse effect upon, the operations, business, properties, liabilities
(actual or contingent), condition (financial or otherwise) or prospects of the
Borrower and its Subsidiaries taken as a whole; (b) a material impairment of the
ability of the Loan Parties taken as a whole to perform their obligations under
the Loan Documents; or (c) a material adverse effect upon the legality,
validity, binding effect or enforceability against any Loan Party of any Loan
Document to which it is a party.
"Maturity Date" means December 21, 2009.
"Medicaid" means that means-tested entitlement program under Title XIX of
the Social Security Act, which provides federal grants to states for medical
assistance based on specific eligibility criteria, as set forth at Section 1396,
et seq. of Title 42 of the United Sates Code, as amended, and any statute
succeeding thereto.
"Medicaid Provider Agreement" means an agreement entered into between a
state agency or other such entity administering the Medicaid program and a
health care provider or supplier under which the health care provider or
supplier agrees to provide items and services for Medicaid patients in
accordance with the terms of the agreement and Medicaid Regulations.
"Medicaid Regulations" means, collectively, (i) all federal statutes
(whether set forth in Title XIX of the Social Security Act or elsewhere)
affecting the medical assistance program established by Title XIX of the Social
Security Act and any statutes succeeding thereto; (ii) all applicable provisions
of all federal rules, regulations, manuals and orders of all Governmental
Authorities promulgated pursuant to or in connection with the statutes described
in clause (i) above and all federal administrative, reimbursement and other
guidelines of all Governmental Authorities having the force of law promulgated
pursuant to or in connection with the statutes described in clause (i) above;
(iii) all state statutes and plans for medical assistance enacted in connection
with the statutes and provisions described in clauses (i) and (ii) above; and
(iv) all applicable provisions of all rules, regulations, manuals and orders of
all Governmental Authorities promulgated pursuant to or in connection with the
statutes described in clause (iii) above and all state administrative,
reimbursement and other guidelines of all Governmental Authorities having the
force of law promulgated pursuant to or in connection with the statutes
described in clause (ii) above, in each case as may be amended, supplemented or
otherwise modified from time to time.
16
"Medical Reimbursement Programs" means a collective reference to the
Medicare, Medicaid and TRICARE programs and any other health care program
operated by or financed in whole or in part by any foreign or domestic federal,
state or local government and any other non-government funded third party payor
programs.
"Medicare" means that government-sponsored entitlement program under Title
XVIII of the Social Security Act, which provides for a health insurance system
for eligible elderly and disabled individuals, as set forth at Section 1395, et
seq. of Title 42 of the United States Code, as amended, and any statute
succeeding thereto.
"Medicare Provider Agreement" means an agreement entered into between CMS
or other such entity administering the Medicare program on behalf of CMS, and a
health care provider or supplier under which the health care provider or
supplier agrees to provide items and services for Medicare patients in
accordance with the terms of the agreement and Medicare Regulations.
"Medicare Regulations" means, collectively, all federal statutes (whether
set forth in Title XVIII of the Social Security Act or elsewhere) affecting the
health insurance program for the aged and disabled established by Title XVIII of
the Social Security Act and any statutes succeeding thereto; together with all
applicable provisions of all rules, regulations, manuals and orders and
administrative, reimbursement and other guidelines having the force of law of
all Governmental Authorities (including, without limitation, CMS, the OIG, HHS,
or any person succeeding to the functions of any of the foregoing) promulgated
pursuant to or in connection with any of the foregoing having the force of law,
as each may be amended, supplemented or otherwise modified from time to time.
"Moody's" means Xxxxx'x Investors Service, Inc. and any successor thereto.
"Mortgage Instrument" means each mortgage, deed of trust, deed to secure
debt or like instrument given by any Loan Party to the Administrative Agent to
secure the Obligations, in each case as amended, modified and supplemented from
time to time.
"Mortgage Policy" has the meaning set forth in Section 7.15.
"Mortgage Property" has the meaning set forth in Section 7.15.
"Multiemployer Plan" means any employee benefit plan of the type described
in Section 4001(a)(3) of ERISA, to which the Borrower or any ERISA Affiliate
makes or is obligated to make contributions, or during the preceding five plan
years, has made or been obligated to make contributions.
"Net Cash Proceeds" means the aggregate cash or Cash Equivalents proceeds
received by the Borrower or any Subsidiary in respect of any Disposition or
Involuntary Disposition, net of (a) direct costs incurred in connection
therewith (including, without limitation, legal, accounting and investment
banking fees, and sales commissions), (b) taxes paid or payable as a result
thereof and (c) the amount necessary to retire any Indebtedness secured by a
Permitted Lien (ranking senior to any Lien of the Administrative Agent) on the
related Property; it being understood that "Net Cash Proceeds" shall include,
without limitation, any cash or Cash Equivalents received upon the sale or other
disposition of any non-cash consideration received by the Borrower or any
Subsidiary in any Disposition or Involuntary Disposition.
"Note" or "Notes" means the Revolving Notes and/or the Swing Line Note,
individually or collectively, as appropriate.
17
"Obligations" means all advances to, and debts, liabilities, obligations,
covenants and duties of, any Loan Party arising under any Loan Document or
otherwise with respect to any Loan or Letter of Credit, whether direct or
indirect (including those acquired by assumption), absolute or contingent, due
or to become due, now existing or hereafter arising and including interest and
fees that accrue after the commencement by or against any Loan Party or any
Affiliate thereof of any proceeding under any Debtor Relief Laws naming such
Person as the debtor in such proceeding, regardless of whether such interest and
fees are allowed claims in such proceeding. The foregoing shall also include any
Swap Contract and any Treasury Management Agreement between any Loan Party and
any Lender or Affiliate of a Lender.
"OIG" means the Office of Inspector General of HHS and any successor
thereof.
"Organization Documents" means, (a) with respect to any corporation, the
certificate or articles of incorporation and the bylaws (or equivalent or
comparable constitutive documents with respect to any non-U.S. jurisdiction);
(b) with respect to any limited liability company, the certificate or articles
of formation or organization and operating agreement; and (c) with respect to
any partnership, joint venture, trust or other form of business entity, the
partnership, joint venture or other applicable agreement of formation or
organization and any agreement, instrument, filing or notice with respect
thereto filed in connection with its formation or organization with the
applicable Governmental Authority in the jurisdiction of its formation or
organization and, if applicable, any certificate or articles of formation or
organization of such entity.
"Outstanding Amount" means (i) with respect to any Loans on any date, the
aggregate outstanding principal amount thereof after giving effect to any
borrowings and prepayments or repayments of any Loans occurring on such date;
and (ii) with respect to any L/C Obligations on any date, the amount of such L/C
Obligations on such date after giving effect to any L/C Credit Extension
occurring on such date and any other changes in the aggregate amount of the L/C
Obligations as of such date, including as a result of any reimbursements of
outstanding unpaid drawings under any Letters of Credit or any reductions in the
maximum amount available for drawing under Letters of Credit taking effect on
such date.
"Participant" has the meaning specified in Section 11.07(d).
"PBGC" means the Pension Benefit Guaranty Corporation or any successor
thereto.
"Pension Plan" means any "employee pension benefit plan" (as such term is
defined in Section 3(2) of ERISA), other than a Multiemployer Plan, that is
subject to Title IV of ERISA and is sponsored or maintained by the Borrower or
any ERISA Affiliate or to which the Borrower or any ERISA Affiliate contributes
or has an obligation to contribute, or in the case of a multiple employer or
other plan described in Section 4064(a) of ERISA, has made contributions at any
time during the immediately preceding five plan years.
"Permitted Acquisitions" means Investments consisting of an Acquisition by
the Borrower or any Subsidiary, provided that (i) the Property acquired (or the
Property of the Person acquired) in such Acquisition is used or useful in the
same or a similar line of business as the Borrower and its Subsidiaries were
engaged in on the Closing Date (or any reasonable extensions or expansions
thereof), (ii) the Administrative Agent shall have received all items in respect
of the Capital Stock or Property acquired in such Acquisition required to be
delivered by the terms of Section 7.12 and/or Section 7.14, (iii) in the case of
an Acquisition of the Capital Stock of another Person, the board of directors
(or other comparable governing body) of such other Person shall have duly
approved such Acquisition, (iv) the Borrower shall have delivered to the
Administrative Agent a Pro Forma Compliance Certificate demonstrating that, upon
18
giving effect to such Acquisition on a Pro Forma Basis, the Loan Parties would
be in compliance with the financial covenants set forth in Section 8.11 as of
the most recent fiscal quarter for which the Borrower has delivered financial
statements pursuant to Section 7.01(a) or (b), (v) the representations and
warranties made by the Loan Parties in any Loan Document shall be true and
correct in all material respects at and as if made as of the date of such
Acquisition (after giving effect thereto) except to the extent such
representations and warranties expressly relate to an earlier date, (vi) if such
transaction involves the purchase of an interest in a partnership between the
Borrower (or a Subsidiary of the Borrower) as a general partner and entities
unaffiliated with the Borrower or such Subsidiary as the other partners, such
transaction shall be effected by having such equity interest acquired by a
corporate holding company directly or indirectly wholly-owned by the Borrower
newly formed for the sole purpose of effecting such transaction, and (vii)
either (A) the Total Consideration paid by the Borrower or any Subsidiary for
any Acquisition (or any series of related Acquisitions) shall not exceed $20
million and the Total Consideration paid by the Borrower and its Subsidiaries
for all Acquisitions in any fiscal year shall not exceed an amount equal to
Consolidated EBITDA on a Pro Forma Basis for the period of four consecutive
fiscal quarters immediately preceding the date of determination, or (B) the
Required Lenders shall have consented to such Acquisition, such consent not to
be unreasonably withheld or delayed or, so long as such consent does not include
or require any amendment or waiver to the Loan Documents (other than the consent
under this clause (B)), conditioned upon the payment of any consent, waiver or
amendment fee.
"Permitted Investments" means, at any time, Investments by the Borrower
and its Subsidiaries permitted to exist at such time pursuant to the terms of
Section 8.02.
"Permitted Liens" means, at any time, Liens in respect of Property of the
Borrower and its Subsidiaries permitted to exist at such time pursuant to the
terms of Section 8.01.
"Person" means any natural person, corporation, limited liability company,
trust, joint venture, association, company, partnership, Governmental Authority
or other entity.
"Plan" means any "employee benefit plan" (as such term is defined in
Section 3(3) of ERISA) established by the Borrower or, with respect to any such
plan that is subject to Section 412 of the Internal Revenue Code or Title IV of
ERISA, any ERISA Affiliate.
"Pledge Agreement" means the Amended and Restated Pledge Agreement dated
as of the Closing Date executed in favor of the Administrative Agent by each of
the Loan Parties, as amended, modified and supplemented from time to time.
"Pro Forma Basis" means, for purposes of calculating the financial
covenants in Section 8.11 (including for purposes of determining the Applicable
Rate), that any Disposition, Involuntary Disposition or Acquisition shall be
deemed to have occurred as of the first day of the most recent four fiscal
quarter period preceding the date of such transaction for which the Borrower has
delivered financial statements pursuant to Section 7.01(a) or (b). In connection
with the foregoing, (a) with respect to any Disposition or Involuntary
Disposition, (i) income statement and cash flow statement items (whether
positive or negative) attributable to the Property disposed of shall be excluded
to the extent relating to any period occurring prior to the date of such
transaction and (ii) Indebtedness which is retired shall be excluded and deemed
to have been retired as of the first day of the applicable period and (b) with
respect to any Acquisition, (i) income statement items attributable to the
Person or Property acquired shall be included to the extent relating to any
period applicable in such calculations to the extent (A) such items are not
otherwise included in such income statement items for the Borrower and its
Subsidiaries in accordance with GAAP or in accordance with any defined terms set
forth in Section 1.1 and (B) such items are supported by financial statements or
other information reasonably satisfactory to the Administrative Agent and (ii)
any Indebtedness incurred or assumed by the Borrower or any Subsidiary
19
(including the Person or Property acquired) in connection with such transaction
and any Indebtedness of the Person or Property acquired which is not retired in
connection with such transaction (A) shall be deemed to have been incurred as of
the first day of the applicable period and (B) if such Indebtedness has a
floating or formula rate, shall have an implied rate of interest for the
applicable period for purposes of this definition determined by utilizing the
rate which is or would be in effect with respect to such Indebtedness as at the
relevant date of determination.
"Pro Forma Compliance Certificate" means a certificate of a Responsible
Officer of the Borrower containing reasonably detailed calculations of the
financial covenants set forth in Section 8.11 as of the most recent fiscal
quarter end for which the Borrower has delivered financial statements pursuant
to Section 7.01(a) or (b) after giving effect to the applicable transaction on a
Pro Forma Basis.
"Pro Rata Share" means, as to each Lender, a fraction (expressed as a
percentage, carried out to the ninth decimal place), the numerator of which is
the amount of the Revolving Commitment of such Lender at such time and the
denominator of which is the amount of the Aggregate Revolving Commitments at
such time; provided that if the commitment of each Lender to make Revolving
Loans and the obligation of the L/C Issuer to make L/C Credit Extensions have
been terminated pursuant to Section 9.02, then the Pro Rata Share of each Lender
shall be determined based on the Pro Rata Share of such Lender immediately prior
to such termination and after giving effect to any subsequent assignments made
pursuant to the terms hereof. The initial Pro Rata Share of each Lender is set
forth opposite the name of such Lender on Schedule 2.01 or in the Assignment and
Assumption pursuant to which such Lender becomes a party hereto, as applicable.
"Property" means any interest of any kind in any property or asset,
whether real, personal or mixed, or tangible or intangible.
"PSI Surety" means PSI Surety, Inc., a Montana corporation.
"Register" has the meaning set forth in Section 11.07(c).
"Reportable Event" means any of the events set forth in Section 4043(c) of
ERISA, other than events for which the thirty-day notice period has been waived.
"Request for Credit Extension" means (a) with respect to a Borrowing,
conversion or continuation of Loans, a Loan Notice, (b) with respect to an L/C
Credit Extension, a Letter of Credit Application, and (c) with respect to a
Swing Line Loan, a Swing Line Loan Notice.
"Required Lenders" means, at any time, Lenders holding in the aggregate
more than fifty percent (50%) of (a) the Revolving Commitments or (b) if the
Revolving Commitments have been terminated, the outstanding Loans, L/C
Obligations, Swing Line Loans and participations therein. The Revolving
Commitment of any Defaulting Lender shall be excluded for purposes of making a
determination of Required Lenders.
"Responsible Officer" means the chief executive officer, president, chief
financial officer, or treasurer of a Loan Party. Any document delivered
hereunder that is signed by a Responsible Officer of a Loan Party shall be
conclusively presumed to have been authorized by all necessary corporate,
partnership and/or other action on the part of such Loan Party and such
Responsible Officer shall be conclusively presumed to have acted on behalf of
such Loan Party.
"Restricted Payment" means any dividend or other distribution (whether in
cash, securities or other property) with respect to any Capital Stock of the
Borrower or any Subsidiary, or any payment
20
(whether in cash, securities or other property), including any sinking fund or
similar deposit, on account of the purchase, redemption, retirement,
acquisition, cancellation or termination of any such Capital Stock or of any
option, warrant or other right to acquire any such Capital Stock.
"Revolving Commitment" means, as to each Lender, its obligation to (a)
make Revolving Loans to the Borrower pursuant to Section 2.01, (b) purchase
participations in L/C Obligations, and (c) purchase participations in Swing Line
Loans, in an aggregate principal amount at any one time outstanding not to
exceed the amount set forth opposite such Lender's name on Schedule 2.01 or in
the Assignment and Assumption pursuant to which such Lender becomes a party
hereto, as applicable, as such amount may be adjusted from time to time in
accordance with this Agreement.
"Revolving Loan" has the meaning specified in Section 2.01(a).
"Revolving Note" has the meaning specified in Section 2.11(a).
"S&P" means Standard & Poor's Ratings Services, a division of The
XxXxxx-Xxxx Companies, Inc. and any successor thereto.
"Sale and Leaseback Transaction" means, with respect to the Borrower or
any Subsidiary, any arrangement, directly or indirectly, with any Person whereby
the Borrower or such Subsidiary shall sell or transfer any property, real or
personal, used or useful in its business, whether now owned or hereafter
acquired, and thereafter rent or lease such property or other property that it
intends to use for substantially the same purpose or purposes as the property
being sold or transferred.
"SEC" means the Securities and Exchange Commission, or any Governmental
Authority succeeding to any of its principal functions.
"Securitization Transaction" means any financing transaction or series of
financing transactions (including factoring arrangements) pursuant to which the
Borrower or any Subsidiary may sell, convey or otherwise transfer, or grant a
security interest in, accounts, payments, receivables, rights to future lease
payments or residuals or similar rights to payment to a special purpose
subsidiary or affiliate of any Person.
"Security Agreement" means the Amended and Restated Security Agreement
dated as of the Closing Date executed in favor of the Administrative Agent by
each of the Loan Parties, as amended, modified and supplemented from time to
time.
"Senior Subordinated Notes" means $150,000,000 aggregate original
principal amount of the Borrower's 10 5/8% Senior Subordinated Notes due 2013.
"Senior Subordinated Notes Documents" means (a) Subordinated Indenture,
(b) the Senior Subordinated Notes, (c) any guaranty agreement given by any
Subsidiary in respect of the Senior Subordinated Notes and (d) all other
documents, agreements and instruments relating to the Senior Subordinated Notes.
"Social Security Act" means the Social Security Act of 1965 as set forth
in Title 42 of the United States Code, as amended, and any successor statute
thereto, as interpreted by the rules and regulations issued thereunder, in each
case as in effect from time to time.
"Subordinated Indebtedness" means (a) the Senior Subordinated Notes, (b)
the "Subordinated Debt" under, and as defined in, the Sunrise Subordination
Agreement and (c) any other Indebtedness of
21
the Borrower or any Subsidiary which by its terms is subordinated to the
Obligations in a manner and to an extent acceptable to the Administrative Agent.
"Subordinated Indebtedness Documents" means (a) the Senior Subordinated
Notes Documents, (b) the Sunrise Subordination Agreement and (c) all other
documents, agreements and instruments governing Subordinated Indebtedness.
"Subordinated Indenture" means the Indenture dated as of June 30, 2003
between the Borrower, the Subsidiaries party thereto as guarantors and Wachovia
Bank, National Association, as trustee.
"Subsidiary" of a Person means a corporation, partnership, joint venture,
limited liability company or other business entity of which a majority of the
shares of Capital Stock having ordinary voting power for the election of
directors or other governing body (other than Capital Stock having such power
only by reason of the happening of a contingency) are at the time beneficially
owned, or the management of which is otherwise controlled, directly, or
indirectly through one or more intermediaries, or both, by such Person. Unless
otherwise specified, all references herein to a "Subsidiary" or to
"Subsidiaries" shall refer to a Subsidiary or Subsidiaries of the Borrower.
"Sunrise Subordination Agreement" means that Subordination Agreement dated
on or about December 1, 2003 by and among Sunrise Girls Home, Inc., Bountiful
Psychiatric Hospital, Inc., the Borrower and CapitalSource Finance LLC,
"Swap Contract" means (a) any and all rate swap transactions, basis swaps,
credit derivative transactions, forward rate transactions, commodity swaps,
commodity options, forward commodity contracts, equity or equity index swaps or
options, bond or bond price or bond index swaps or options or forward bond or
forward bond price or forward bond index transactions, interest rate options,
forward foreign exchange transactions, cap transactions, floor transactions,
collar transactions, currency swap transactions, cross-currency rate swap
transactions, currency options, spot contracts, or any other similar
transactions or any combination of any of the foregoing (including any options
to enter into any of the foregoing), whether or not any such transaction is
governed by or subject to any master agreement, and (b) any and all transactions
of any kind, and the related confirmations, which are subject to the terms and
conditions of, or governed by, any form of master agreement published by the
International Swaps and Derivatives Association, Inc., any International Foreign
Exchange Master Agreement, or any other master agreement (any such master
agreement, together with any related schedules, a "Master Agreement"), including
any such obligations or liabilities under any Master Agreement.
"Swap Termination Value" means, in respect of any one or more Swap
Contracts, after taking into account the effect of any legally enforceable
netting agreement relating to such Swap Contracts, (a) for any date on or after
the date such Swap Contracts have been closed out and termination value(s)
determined in accordance therewith, such termination value(s), and (b) for any
date prior to the date referenced in clause (a), the amount(s) determined as the
xxxx-to-market value(s) for such Swap Contracts, as determined based upon one or
more mid-market or other readily available quotations provided by any recognized
dealer in such Swap Contracts (which may include a Lender or any Affiliate of a
Lender).
"Swing Line Lender" means (a) Bank of America in its capacity as provider
of Swing Line Loans, or (b) any successor swing line lender hereunder.
"Swing Line Loan" has the meaning specified in Section 2.04(a).
22
"Swing Line Loan Notice" means a notice of a Borrowing of Swing Line Loans
pursuant to Section 2.04(b), which, if in writing, shall be substantially in the
form of Exhibit B.
"Swing Line Note" has the meaning specified in Section 2.11(a).
"Swing Line Sublimit" means an amount equal to the lesser of (a)
$5,000,000 or (b) the Aggregate Revolving Commitments. The Swing Line Sublimit
is part of, and not in addition to, the Aggregate Revolving Commitments.
"Synthetic Lease" means any synthetic lease, tax retention operating
lease, off-balance sheet loan or similar off-balance sheet financing arrangement
whereby the arrangement is considered borrowed money indebtedness for tax
purposes but is classified as an operating lease or does not otherwise appear on
a balance sheet under GAAP.
"Threshold Amount" means $3,000,000.
"Total Consideration" means, with respect to any Acquisition, all cash and
non-cash consideration, including, without limitation, the amount of
Indebtedness assumed, the amount reasonably anticipated to be payable in
connection with any deferred purchase price obligation (including any earn-out
obligation) as determined by the Borrower in good faith at the time of the
consummation of such Acquisition, and the value of any Capital Stock of the
Borrower issued to the seller, but excluding any cash consideration funded with
the proceeds of the Equity Offering.
"Total Revolving Outstandings" means the aggregate Outstanding Amount of
all Revolving Loans, all Swing Line Loans and all L/C Obligations.
"Treasury Management Agreements" means any and all agreements governing
the provision of treasury or cash management services, including, without
limitation, deposit accounts, funds transfer, automated clearinghouse, zero
balance accounts, returned check concentration, controlled disbursement,
lockbox, account reconciliation and reporting and trade finance services.
"TRICARE" means the United States Department of Defense health care
program for service families (including TRICARE Prime, TRICARE Extra and TRICARE
Standard), and any successor or predecessor thereof.
"Type" means, with respect to any Loan, its character as a Base Rate Loan
or a Eurodollar Rate Loan.
"Unfunded Pension Liability" means the excess of a Pension Plan's benefit
liabilities under Section 4001(a)(16) of ERISA, over the current value of that
Pension Plan's assets, determined in accordance with the assumptions used for
funding the Pension Plan pursuant to Section 412 of the Internal Revenue Code
for the applicable plan year.
"United States" and "U.S." mean the United States of America.
"Unreimbursed Amount" has the meaning set forth in Section 2.03(c)(i).
"Voting Stock" means, with respect to any Person, Capital Stock issued by
such Person the holders of which are ordinarily, in the absence of
contingencies, entitled to vote for the election of directors (or persons
performing similar functions) of such Person, even though the right so to vote
has been suspended by the happening of such a contingency.
23
"Wholly Owned Subsidiary" means any Person 100% of whose Capital Stock is
at the time owned by the Borrower directly or indirectly through other Persons
100% of whose Capital Stock is at the time owned, directly or indirectly, by the
Borrower.
1.02 OTHER INTERPRETIVE PROVISIONS.
With reference to this Agreement and each other Loan Document, unless
otherwise specified herein or in such other Loan Document:
(a) The meanings of defined terms are equally applicable to the
singular and plural forms of the defined terms.
(b) (i) The words "herein," "hereto," "hereof" and "hereunder" and
words of similar import when used in any Loan Document shall refer to such
Loan Document as a whole and not to any particular provision thereof.
(ii) Article, Section, Exhibit and Schedule references are to
the Loan Document in which such reference appears.
(iii) The term "including" is by way of example and not
limitation.
(iv) The term "documents" includes any and all instruments,
documents, agreements, certificates, notices, reports, financial
statements and other writings, however evidenced, whether in
physical or electronic form.
(c) In the computation of periods of time from a specified date to a
later specified date, the word "from" means "from and including;" the
words "to" and "until" each mean "to but excluding;" and the word
"through" means "to and including."
(d) Section headings herein and in the other Loan Documents are
included for convenience of reference only and shall not affect the
interpretation of this Agreement or any other Loan Document.
1.03 ACCOUNTING TERMS.
(a) Except as otherwise specifically prescribed herein, all accounting
terms not specifically or completely defined herein shall be construed in
conformity with, and all financial data (including financial ratios and other
financial calculations) required to be submitted pursuant to this Agreement
shall be prepared in conformity with, GAAP applied on a consistent basis, as in
effect from time to time, applied in a manner consistent with that used in
preparing the most recent Audited Financial Statements; provided, however, that
calculations of Attributable Indebtedness under any Synthetic Lease or the
implied interest component of any Synthetic Lease shall be made by the Borrower
in accordance with accepted financial practice and consistent with the terms of
such Synthetic Lease.
(b) Together with each Compliance Certificate, the Borrower will provide a
written summary of any changes in GAAP that materially impact the calculation of
the financial covenants in Section 8.11 contained in such Compliance
Certificate. If at any time any change in GAAP would affect the computation of
any financial ratio or requirement set forth in any Loan Document, and either
the Borrower or the Required Lenders shall so request, the Administrative Agent,
the Lenders and the Borrower shall negotiate in good faith to amend such ratio
or requirement to preserve the original intent
24
thereof in light of such change in GAAP (subject to the approval of the Required
Lenders); provided that, until so amended, (i) such ratio or requirement shall
continue to be computed in accordance with GAAP prior to such change therein and
(ii) the Borrower shall provide to the Administrative Agent and the Lenders
financial statements and other documents required under this Agreement or as
reasonably requested hereunder setting forth a reconciliation between
calculations of such ratio or requirement made before and after giving effect to
such change in GAAP.
(c) Notwithstanding the above, the parties hereto acknowledge and agree
that all calculations of the financial covenants in Section 8.11 (including for
purposes of determining compliance with such financial covenants and determining
the Applicable Rate) shall be made on a Pro Forma Basis.
1.04 ROUNDING.
Any financial ratios required to be maintained by the Borrower pursuant to
this Agreement shall be calculated by dividing the appropriate component by the
other component, carrying the result to one place more than the number of places
by which such ratio is expressed herein and rounding the result up or down to
the nearest number (with a rounding-up if there is no nearest number).
1.05 REFERENCES TO AGREEMENTS AND LAWS.
Unless otherwise expressly provided herein, (a) references to Organization
Documents, agreements (including the Loan Documents) and other contractual
instruments shall be deemed to include all subsequent amendments, restatements,
extensions, supplements and other modifications thereto, but only to the extent
that such amendments, restatements, extensions, supplements and other
modifications are not prohibited by any Loan Document; and (b) references to any
Law shall include all statutory and regulatory provisions consolidating,
amending, replacing, supplementing or interpreting such Law.
1.06 TIMES OF DAY.
Unless otherwise specified, all references herein to times of day shall be
references to Eastern time (daylight or standard, as applicable).
1.07 LETTER OF CREDIT AMOUNTS.
Unless otherwise specified, all references herein to the amount of a
Letter of Credit at any time shall be deemed to mean the maximum face amount of
such Letter of Credit after giving effect to all increases thereof contemplated
by such Letter of Credit or the Letter of Credit Application therefor, whether
or not such maximum face amount is in effect at such time.
ARTICLE II
THE COMMITMENTS AND CREDIT EXTENSIONS
2.01 REVOLVING LOANS.
Subject to the terms and conditions set forth herein, each Lender
severally agrees to make loans (each such loan, a "Revolving Loan") to the
Borrower in Dollars from time to time on any Business Day during the
Availability Period in an aggregate amount not to exceed at any time outstanding
the amount of such Lender's Revolving Commitment; provided, however, that after
giving effect to any Borrowing of Revolving Loans, (i) the Total Revolving
Outstandings shall not exceed the Aggregate Revolving Commitments, and (ii) the
aggregate Outstanding Amount of the Revolving Loans of any Lender, plus
25
such Lender's Pro Rata Share of the Outstanding Amount of all L/C Obligations,
plus such Lender's Pro Rata Share of the Outstanding Amount of all Swing Line
Loans shall not exceed such Lender's Revolving Commitment. Within the limits of
each Lender's Revolving Commitment, and subject to the other terms and
conditions hereof, the Borrower may borrow under this Section 2.01, prepay under
Section 2.05, and reborrow under this Section 2.01. Revolving Loans may be Base
Rate Loans or Eurodollar Rate Loans, as further provided herein, provided,
however, all Borrowings made on the Closing Date shall be made as Base Rate
Loans.
2.02 BORROWINGS, CONVERSIONS AND CONTINUATIONS OF LOANS.
(a) Each Borrowing, each conversion of Loans from one Type to the other,
and each continuation of Eurodollar Rate Loans shall be made upon the Borrower's
irrevocable notice to the Administrative Agent, which may be given by telephone.
Each such notice must be received by the Administrative Agent not later than
11:00 a.m. (i) three Business Days prior to the requested date of any Borrowing
of, conversion to or continuation of Eurodollar Rate Loans or of any conversion
of Eurodollar Rate Loans to Base Rate Loans, and (ii) on the requested date of
any Borrowing of Base Rate Loans. Each telephonic notice by the Borrower
pursuant to this Section 2.02(b) must be confirmed promptly by delivery to the
Administrative Agent of a written Loan Notice, appropriately completed and
signed by a Responsible Officer of the Borrower. Each Borrowing of, conversion
to or continuation of Eurodollar Rate Loans shall be in a principal amount of
$1,000,000 or a whole multiple of $100,000 in excess thereof. Except as provided
in Sections 2.03(c) and 2.04(c), each Borrowing of or conversion to Base Rate
Loans shall be in a principal amount of $500,000 or a whole multiple of $100,000
in excess thereof. Each Loan Notice (whether telephonic or written) shall
specify (i) whether the Borrower is requesting a Borrowing, a conversion of
Loans from one Type to the other, or a continuation of Eurodollar Rate Loans,
(ii) the requested date of the Borrowing, conversion or continuation, as the
case may be (which shall be a Business Day), (iii) the principal amount of Loans
to be borrowed, converted or continued, (iv) the Type of Loans to be borrowed or
to which existing Loans are to be converted, and (v) if applicable, the duration
of the Interest Period with respect thereto. If the Borrower fails to specify a
Type of Loan in a Loan Notice or if the Borrower fails to give a timely notice
requesting a conversion or continuation, then the applicable Loans shall be made
as, or converted to, Eurodollar Loans with an Interest Period of one month. Any
such automatic conversion to Eurodollar Loans with an Interest Period of one
month shall be effective as of the last day of the Interest Period then in
effect with respect to the applicable Eurodollar Rate Loans. If the Borrower
requests a Borrowing of, conversion to, or continuation of Eurodollar Rate Loans
in any such Loan Notice, but fails to specify an Interest Period, it will be
deemed to have specified an Interest Period of one month.
(b) Following receipt of a Loan Notice, the Administrative Agent shall
promptly notify each Lender of the amount of its Pro Rata Share of the
applicable Loans, and if no timely notice of a conversion or continuation is
provided by the Borrower, the Administrative Agent shall notify each Lender of
the details of any automatic conversion to Base Rate Loans described in the
preceding subsection. In the case of a Borrowing, each Lender shall make the
amount of its Loan available to the Administrative Agent in immediately
available funds at the Administrative Agent's Office not later than 1:00 p.m. on
the Business Day specified in the applicable Loan Notice. Upon satisfaction of
the applicable conditions set forth in Section 5.02 (and, if such Borrowing is
the initial Credit Extension, Section 5.01), the Administrative Agent shall make
all funds so received available to the Borrower in like funds as received by the
Administrative Agent either by (i) crediting the account of the Borrower on the
books of Bank of America with the amount of such funds or (ii) wire transfer of
such funds, in each case in accordance with instructions provided to (and
reasonably acceptable to) the Administrative Agent by the Borrower; provided,
however, that if, on the date a Borrowing of Revolving Loans, there are Swing
Line Loans or L/C Borrowings outstanding, then the proceeds of such Borrowing
shall be applied, first, to
26
the payment in full of any such L/C Borrowings, second, to the payment in full
of any such Swing Line Loans, and third, to the Borrower as provided above.
(c) Except as otherwise provided herein, a Eurodollar Rate Loan may be
continued or converted only on the last day of the Interest Period for such
Eurodollar Rate Loan. During the existence of a Default, no Loans may be
requested as, converted to or continued as Eurodollar Rate Loans without the
consent of the Required Lenders, and the Required Lenders may demand that any or
all of the then outstanding Eurodollar Rate Loans be converted immediately to
Base Rate Loans.
(d) The Administrative Agent shall promptly notify the Borrower and the
Lenders of the interest rate applicable to any Interest Period for Eurodollar
Rate Loans upon determination of such interest rate. The determination of the
Eurodollar Rate by the Administrative Agent shall be conclusive in the absence
of manifest error. At any time that Base Rate Loans are outstanding, the
Administrative Agent shall notify the Borrower and the Lenders of any change in
Bank of America's prime rate used in determining the Base Rate promptly
following the public announcement of such change.
(e) After giving effect to all Borrowings, all conversions of Loans from
one Type to the other, and all continuations of Loans as the same Type, there
shall not be more than five (5) Interest Periods in effect with respect to
Revolving Loans.
2.03 LETTERS OF CREDIT.
(a) The Letter of Credit Commitment.
(i) Subject to the terms and conditions set forth herein, (A) the
L/C Issuer agrees, in reliance upon the agreements of the other Lenders
set forth in this Section 2.03, (1) from time to time on any Business Day
during the period from the Closing Date until the Letter of Credit
Expiration Date, to issue Letters of Credit in Dollars for the account of
the Borrower or any of its Subsidiaries, and to amend or renew Letters of
Credit previously issued by it, in accordance with subsection (b) below,
and (2) to honor drafts under the Letters of Credit; and (B) the Lenders
severally agree to participate in Letters of Credit issued for the account
of the Borrower or any of its Subsidiaries; provided that the L/C Issuer
shall not be obligated to make any L/C Credit Extension with respect to
any Letter of Credit, and no Lender shall be obligated to participate in
any Letter of Credit if, after giving effect to such L/C Credit Extension,
(x) the Total Revolving Outstandings would exceed the Aggregate Revolving
Commitments, (y) the aggregate Outstanding Amount of the Revolving Loans
of any Lender, plus such Lender's Pro Rata Share of the Outstanding Amount
of all L/C Obligations, plus such Lender's Pro Rata Share of the
Outstanding Amount of all Swing Line Loans would exceed such Lender's
Revolving Commitment, or (z) the Outstanding Amount of the L/C Obligations
would exceed the Letter of Credit Sublimit. Within the foregoing limits,
and subject to the terms and conditions hereof, the Borrower's ability to
obtain Letters of Credit shall be fully revolving, and accordingly the
Borrower may, during the foregoing period, obtain Letters of Credit to
replace Letters of Credit that have expired or that have been drawn upon
and reimbursed.
(ii) The L/C Issuer shall be under no obligation to issue any Letter
of Credit if:
(A) any order, judgment or decree of any Governmental
Authority or arbitrator shall by its terms purport to enjoin or
restrain the L/C Issuer from issuing such Letter of Credit, or any
Law applicable to the L/C Issuer or any request or directive
(whether or not having the force of law) from any Governmental
Authority with jurisdiction over the L/C Issuer shall prohibit, or
request that the L/C Issuer refrain from,
27
the issuance of letters of credit generally or such Letter of Credit
in particular or shall impose upon the L/C Issuer with respect to
such Letter of Credit any restriction, reserve or capital
requirement (for which the L/C Issuer is not otherwise compensated
hereunder) not in effect on the Closing Date, or shall impose upon
the L/C Issuer any unreimbursed loss, cost or expense which was not
applicable on the Closing Date and which the L/C Issuer in good
xxxxx xxxxx material to it;
(B) subject to Section 2.03(b)(iii), the expiry date of such
requested Letter of Credit would occur more than twelve months after
the date of issuance or last renewal, unless the Required Lenders
have approved such expiry date;
(C) the expiry date of such requested Letter of Credit would
occur after the Letter of Credit Expiration Date, unless all the
Lenders have approved such expiry date;
(D) the issuance of such Letter of Credit would violate one or
more policies of the L/C Issuer; or
(E) such Letter of Credit is in an initial amount less than
$100,000 or is to be denominated in a currency other than Dollars.
(iii) The L/C Issuer shall be under no obligation to amend any
Letter of Credit if (A) the L/C Issuer would have no obligation at such
time to issue such Letter of Credit in its amended form under the terms
hereof, or (B) the beneficiary of such Letter of Credit does not accept
the proposed amendment to such Letter of Credit.
(iv) The L/C Issuer shall be under no obligation to issue or amend
any Letter of Credit if the L/C Issuer has received written notice from
any Lender, the Administrative Agent or any Loan Party, on or prior to the
Business Day prior to the requested date of issuance or amendment of such
Letter of Credit, that one or more applicable conditions contained in
Article V shall not then be satisfied.
(b) Procedures for Issuance and Amendment of Letters of Credit;
Auto-Renewal Letters of Credit.
(i) Each Letter of Credit shall be issued or amended, as the case
may be, upon the request of the Borrower delivered to the L/C Issuer (with
a copy to the Administrative Agent) in the form of a Letter of Credit
Application, appropriately completed and signed by a Responsible Officer
of the Borrower. Such Letter of Credit Application must be received by the
L/C Issuer and the Administrative Agent not later than 11:00 a.m. at least
three Business Days (or such later date and time as the L/C Issuer may
agree in a particular instance in its sole discretion) prior to the
proposed issuance date or date of amendment, as the case may be. In the
case of a request for an initial issuance of a Letter of Credit, such
Letter of Credit Application shall specify in form and detail satisfactory
to the L/C Issuer: (A) the proposed issuance date of the requested Letter
of Credit (which shall be a Business Day); (B) the amount thereof; (C) the
expiry date thereof; (D) the name and address of the beneficiary thereof;
(E) the documents to be presented by such beneficiary in case of any
drawing thereunder; (F) the full text of any certificate to be presented
by such beneficiary in case of any drawing thereunder; and (G) such other
matters as the L/C Issuer may reasonably require. In the case of a request
for an amendment of any outstanding Letter of Credit, such Letter of
Credit Application shall specify in form and detail satisfactory to the
L/C Issuer (A) the Letter of Credit to be amended; (B) the proposed date
of amendment
28
thereof (which shall be a Business Day); (C) the nature of the proposed
amendment; and (D) such other matters as the L/C Issuer may reasonably
require.
(ii) Promptly after receipt of any Letter of Credit Application, the
L/C Issuer will confirm with the Administrative Agent (by telephone or in
writing) that the Administrative Agent has received a copy of such Letter
of Credit Application from the Borrower and, if not, the L/C Issuer will
provide the Administrative Agent with a copy thereof. Upon receipt by the
L/C Issuer of confirmation from the Administrative Agent that the
requested issuance or amendment is permitted in accordance with the terms
hereof, then, subject to the terms and conditions hereof, the L/C Issuer
shall, on the requested date, issue a Letter of Credit for the account of
the Borrower or enter into the applicable amendment, as the case may be,
in each case in accordance with the L/C Issuer's usual and customary
business practices. Immediately upon the issuance of each Letter of
Credit, each Lender shall be deemed to, and hereby irrevocably and
unconditionally agrees to, purchase from the L/C Issuer a risk
participation in such Letter of Credit in an amount equal to the product
of such Lender's Pro Rata Share times the amount of such Letter of Credit.
(iii) If the Borrower so requests in any applicable Letter of Credit
Application, the L/C Issuer shall issue a Letter of Credit that has
automatic renewal provisions (each, an "Auto-Renewal Letter of Credit");
provided that any such Auto-Renewal Letter of Credit must permit the L/C
Issuer to prevent any such renewal at least once in each twelve-month
period (commencing with the date of issuance of such Letter of Credit) by
giving prior notice to the beneficiary thereof not later than a day (the
"Nonrenewal Notice Date") in each such twelve-month period to be agreed
upon at the time such Letter of Credit is issued. Unless otherwise
directed by the L/C Issuer, the Borrower shall not be required to make a
specific request to the L/C Issuer for any such renewal. Once an
Auto-Renewal Letter of Credit has been issued, the Lenders shall be deemed
to have authorized (but may not require) the L/C Issuer to permit the
renewal of such Letter of Credit at any time to an expiry date not later
than the Letter of Credit Expiration Date; provided, however, that the L/C
Issuer shall not permit any such renewal if (A) the L/C Issuer has
determined that it would have no obligation at such time to issue such
Letter of Credit in its renewed form under the terms hereof (by reason of
the provisions of Section 2.03(a)(ii) or otherwise), or (B) it has
received notice (which may be by telephone or in writing) on or before the
day that is five (5) Business Days before the Nonrenewal Notice Date (1)
from the Administrative Agent that the Required Lenders have elected not
to permit such renewal or (2) from the Administrative Agent, any Lender or
the Borrower that one or more of the applicable conditions specified in
Section 5.02 is not then satisfied.
(iv) Promptly after its delivery of any Letter of Credit or any
amendment to a Letter of Credit to an advising bank with respect thereto
or to the beneficiary thereof, the L/C Issuer will also deliver to the
Borrower and the Administrative Agent a true and complete copy of such
Letter of Credit or amendment.
(c) Drawings and Reimbursements; Funding of Participations.
(i) Upon receipt from the beneficiary of any Letter of Credit of any
notice of drawing under such Letter of Credit, the L/C Issuer shall notify
the Borrower and the Administrative Agent thereof. Not later than 11:00
a.m. on the date of any payment by the L/C Issuer under a Letter of Credit
(each such date, an "Honor Date"), the Borrower shall reimburse the L/C
Issuer through the Administrative Agent in an amount equal to the amount
of such drawing. If the Borrower fails to so reimburse the L/C Issuer by
such time, the Administrative Agent shall promptly notify each Lender of
the Honor Date, the amount of the unreimbursed
29
drawing (the "Unreimbursed Amount"), and the amount of such Lender's Pro
Rata Share thereof. In such event, the Borrower shall be deemed to have
requested a Borrowing of Base Rate Loans to be disbursed on the Honor Date
in an amount equal to the Unreimbursed Amount, without regard to the
minimum and multiples specified in Section 2.02 for the principal amount
of Base Rate Loans, but subject to the amount of the unutilized portion of
the Aggregate Revolving Commitments and the conditions set forth in
Section 5.02 (other than the delivery of a Loan Notice). Any notice given
by the L/C Issuer or the Administrative Agent pursuant to this Section
2.03(c)(i) may be given by telephone if immediately confirmed in writing;
provided that the lack of such an immediate confirmation shall not affect
the conclusiveness or binding effect of such notice.
(ii) Each Lender (including the Lender acting as L/C Issuer) shall
upon any notice pursuant to Section 2.03(c)(i) make funds available to the
Administrative Agent for the account of the L/C Issuer at the
Administrative Agent's Office in an amount equal to its Pro Rata Share of
the Unreimbursed Amount not later than 1:00 p.m. on the Business Day
specified in such notice by the Administrative Agent, whereupon, subject
to the provisions of Section 2.03(c)(iii), each Lender that so makes funds
available shall be deemed to have made a Base Rate Loan to the Borrower in
such amount. The Administrative Agent shall remit the funds so received to
the L/C Issuer.
(iii) With respect to any Unreimbursed Amount that is not fully
refinanced by a Borrowing of Base Rate Loans because the conditions set
forth in Section 5.02 cannot be satisfied or for any other reason, the
Borrower shall be deemed to have incurred from the L/C Issuer an L/C
Borrowing in the amount of the Unreimbursed Amount that is not so
refinanced, which L/C Borrowing shall be due and payable on demand
(together with interest) and shall bear interest at the Default Rate. In
such event, each Lender's payment to the Administrative Agent for the
account of the L/C Issuer pursuant to Section 2.03(c)(ii) shall be deemed
payment in respect of its participation in such L/C Borrowing and shall
constitute an L/C Advance from such Lender in satisfaction of its
participation obligation under this Section 2.03.
(iv) Until each Lender funds its Revolving Loan or L/C Advance
pursuant to this Section 2.03(c) to reimburse the L/C Issuer for any
amount drawn under any Letter of Credit, interest in respect of such
Lender's Pro Rata Share of such amount shall be solely for the account of
the L/C Issuer.
(v) Each Lender's obligation to make Revolving Loans or L/C Advances
to reimburse the L/C Issuer for amounts drawn under Letters of Credit, as
contemplated by this Section 2.03(c), shall be absolute and unconditional
and shall not be affected by any circumstance, including (A) any set-off,
counterclaim, recoupment, defense or other right which such Lender may
have against the L/C Issuer, the Borrower or any other Person for any
reason whatsoever; (B) the occurrence or continuance of a Default, or (C)
any other occurrence, event or condition, whether or not similar to any of
the foregoing; provided, however, that each Lender's obligation to make
Revolving Loans pursuant to this Section 2.03(c) is subject to the
conditions set forth in Section 5.02 (other than delivery by the Borrower
of a Loan Notice). No such making of an L/C Advance shall relieve or
otherwise impair the obligation of the Borrower to reimburse the L/C
Issuer for the amount of any payment made by the L/C Issuer under any
Letter of Credit, together with interest as provided herein.
(vi) If any Lender fails to make available to the Administrative
Agent for the account of the L/C Issuer any amount required to be paid by
such Lender pursuant to the foregoing provisions of this Section 2.03(c)
by the time specified in Section 2.03(c)(ii), the L/C Issuer shall
30
be entitled to recover from such Lender (acting through the Administrative
Agent), on demand, such amount with interest thereon for the period from
the date such payment is required to the date on which such payment is
immediately available to the L/C Issuer at a rate per annum equal to the
Federal Funds Rate from time to time in effect. A certificate of the L/C
Issuer submitted to any Lender (through the Administrative Agent) with
respect to any amounts owing under this clause (vi) shall be conclusive
absent manifest error.
(d) Repayment of Participations.
(i) At any time after the L/C Issuer has made a payment under any
Letter of Credit and has received from any Lender such Lender's L/C
Advance in respect of such payment in accordance with Section 2.03(c), if
the Administrative Agent receives for the account of the L/C Issuer any
payment in respect of the related Unreimbursed Amount or interest thereon
(whether directly from the Borrower or otherwise, including proceeds of
Cash Collateral applied thereto by the Administrative Agent), the
Administrative Agent will distribute to such Lender its Pro Rata Share
thereof (appropriately adjusted, in the case of interest payments, to
reflect the period of time during which such Lender's L/C Advance was
outstanding) in the same funds as those received by the Administrative
Agent.
(ii) If any payment received by the Administrative Agent for the
account of the L/C Issuer pursuant to Section 2.03(c)(i) is required to be
returned under any of the circumstances described in Section 11.06
(including pursuant to any settlement entered into by the L/C Issuer in
its discretion), each Lender shall pay to the Administrative Agent for the
account of the L/C Issuer its Pro Rata Share thereof on demand of the
Administrative Agent, plus interest thereon from the date of such demand
to the date such amount is returned by such Lender, at a rate per annum
equal to the Federal Funds Rate from time to time in effect.
(e) Obligations Absolute. The obligation of the Borrower to reimburse the
L/C Issuer for each drawing under each Letter of Credit and to repay each L/C
Borrowing shall be absolute, unconditional and irrevocable, and shall be paid
strictly in accordance with the terms of this Agreement under all circumstances,
including the following:
(i) any lack of validity or enforceability of such Letter of Credit,
this Agreement, any other Loan Document or any other agreement or
instrument relating thereto;
(ii) the existence of any claim, counterclaim, set-off, defense or
other right that the Borrower may have at any time against any beneficiary
or any transferee of such Letter of Credit (or any Person for whom any
such beneficiary or any such transferee may be acting), the L/C Issuer or
any other Person, whether in connection with this Agreement, the
transactions contemplated hereby or by such Letter of Credit or any
agreement or instrument relating thereto, or any unrelated transaction;
(iii) any draft, demand, certificate or other document presented
under such Letter of Credit proving to be forged, fraudulent, invalid or
insufficient in any respect or any statement therein being untrue or
inaccurate in any respect; or any loss or delay in the transmission or
otherwise of any document required in order to make a drawing under such
Letter of Credit;
(iv) any payment by the L/C Issuer under such Letter of Credit
against presentation of a draft or certificate that does not strictly
comply with the terms of such Letter of Credit; or any payment made by the
L/C Issuer under such Letter of Credit to any Person purporting to be a
trustee in bankruptcy, debtor-in-possession, assignee for the benefit of
creditors, liquidator,
31
receiver or other representative of or successor to any beneficiary or any
transferee of such Letter of Credit, including any arising in connection
with any proceeding under any Debtor Relief Law; or
(v) any other circumstance or happening whatsoever, whether or not
similar to any of the foregoing, including any other circumstance that
might otherwise constitute a defense available to, or a discharge of, the
Borrower.
The Borrower shall promptly examine a copy of each Letter of Credit and
each amendment thereto that is delivered to it and, in the event of any claim of
noncompliance with the Borrower's instructions or other irregularity, the
Borrower will immediately notify the L/C Issuer. The Borrower shall be
conclusively deemed to have waived any such claim against the L/C Issuer and its
correspondents unless such notice is given as aforesaid.
(f) Role of L/C Issuer. Each Lender and the Borrower agree that, in paying
any drawing under a Letter of Credit, the L/C Issuer shall not have any
responsibility to obtain any document (other than any sight draft, certificates
and documents expressly required by such Letter of Credit) or to ascertain or
inquire as to the validity or accuracy of any such document or the authority of
the Person executing or delivering any such document. None of the L/C Issuer,
any Agent-Related Person or any of the respective correspondents, participants
or assignees of the L/C Issuer shall be liable to any Lender for (i) any action
taken or omitted in connection herewith at the request or with the approval of
the Lenders or the Required Lenders, as applicable; (ii) any action taken or
omitted in the absence of gross negligence or willful misconduct; or (iii) the
due execution, effectiveness, validity or enforceability of any document or
instrument related to any Letter of Credit or Letter of Credit Application. The
Borrower hereby assumes all risks of the acts or omissions of any beneficiary or
transferee with respect to its use of any Letter of Credit; provided, however,
that this assumption is not intended to, and shall not, preclude the Borrower's
pursuing such rights and remedies as it may have against the beneficiary or
transferee at law or under any other agreement. None of the L/C Issuer, any
Agent-Related Person, nor any of the respective correspondents, participants or
assignees of the L/C Issuer, shall be liable or responsible for any of the
matters described in clauses (i) through (v) of Section 2.03(e); provided,
however, that anything in such clauses to the contrary notwithstanding, the
Borrower may have a claim against the L/C Issuer, and the L/C Issuer may be
liable to the Borrower, to the extent, but only to the extent, of any direct, as
opposed to consequential or exemplary, damages suffered by the Borrower which
the Borrower proves were caused by the L/C Issuer's willful misconduct or gross
negligence or the L/C Issuer's willful failure to pay under any Letter of Credit
after the presentation to it by the beneficiary of a sight draft and
certificate(s) strictly complying with the terms and conditions of a Letter of
Credit. In furtherance and not in limitation of the foregoing, the L/C Issuer
may accept documents that appear on their face to be in order, without
responsibility for further investigation, regardless of any notice or
information to the contrary, and the L/C Issuer shall not be responsible for the
validity or sufficiency of any instrument transferring or assigning or
purporting to transfer or assign a Letter of Credit or the rights or benefits
thereunder or proceeds thereof, in whole or in part, which may prove to be
invalid or ineffective for any reason.
(g) Cash Collateral. Upon the request of the Administrative Agent, (i) if
the L/C Issuer has honored any full or partial drawing request under any Letter
of Credit and such drawing has resulted in an L/C Borrowing, or (ii) if, as of
the Letter of Credit Expiration Date, any Letter of Credit may for any reason
remain outstanding and partially or wholly undrawn, the Borrower shall
immediately Cash Collateralize the then Outstanding Amount of all L/C
Obligations (in an amount equal to such Outstanding Amount determined as of the
date of such L/C Borrowing or the Letter of Credit Expiration Date, as the case
may be). For purposes hereof, "Cash Collateralize" means to pledge and deposit
with or deliver to the Administrative Agent, for the benefit of the L/C Issuer
and the Lenders, as collateral for the
32
L/C Obligations, cash or deposit account balances pursuant to documentation in
form and substance satisfactory to the Administrative Agent and the L/C Issuer
(which documents are hereby consented to by the Lenders). Derivatives of such
term have corresponding meanings. The Borrower hereby grants to the
Administrative Agent, for the benefit of the L/C Issuer and the Lenders, a
security interest in all such cash, deposit accounts and all balances therein
and all proceeds of the foregoing. Cash collateral shall be maintained in
blocked, non-interest bearing deposit accounts at Bank of America.
(h) Applicability of ISP98. Unless otherwise expressly agreed by the
L/C Issuer and the Borrower when a Letter of Credit is issued, the rules of the
"International Standby Practices 1998" published by the Institute of
International Banking Law & Practice (or such later version thereof as may be in
effect at the time of issuance) shall apply to each standby Letter of Credit.
(i) Letter of Credit Fees. The Borrower shall pay to the Administrative
Agent for the account of each Lender in accordance with its Pro Rata Share a
Letter of Credit fee for each Letter of Credit equal to the Applicable Rate
times the daily maximum amount available to be drawn under such Letter of Credit
(whether or not such maximum amount is then in effect under such Letter of
Credit). Such Letter of Credit fees shall be computed on a quarterly basis in
arrears. Such Letter of Credit fees shall be due and payable on the first
Business Day after the end of each March, June, September and December,
commencing with the first such date to occur after the issuance of such Letter
of Credit, on the Letter of Credit Expiration Date and thereafter on demand. If
there is any change in the Applicable Rate during any quarter, the daily maximum
amount of each Letter of Credit shall be computed and multiplied by the
Applicable Rate separately for each period during such quarter that such
Applicable Rate was in effect.
(j) Documentary and Processing Charges Payable to L/C Issuer. The Borrower
shall pay directly to the L/C Issuer for its own account a fronting fee with
respect to each Letter of Credit in the amounts and at the times specified in
the Fee Letter. In addition, the Borrower shall pay directly to the L/C Issuer
for its own account the customary issuance, presentation, amendment and other
processing fees, and other standard costs and charges, of the L/C Issuer
relating to letters of credit as from time to time in effect. Such customary
fees and standard costs and charges are due and payable on demand and are
nonrefundable.
(k) Conflict with Letter of Credit Application. In the event of any
conflict between the terms hereof and the terms of any Letter of Credit
Application, the terms hereof shall control.
2.04 SWING LINE LOANS.
(a) The Swing Line. Subject to the terms and conditions set forth herein,
the Swing Line Lender agrees to make loans (each such loan, a "Swing Line Loan")
to the Borrower in Dollars from time to time on any Business Day during the
Availability Period in an aggregate amount not to exceed at any time outstanding
the amount of the Swing Line Sublimit, notwithstanding the fact that such Swing
Line Loans, when aggregated with the Pro Rata Share of the Outstanding Amount of
Revolving Loans and L/C Obligations of the Swing Line Lender in its capacity as
a Lender of Revolving Loans, may exceed the amount of such Lender's Revolving
Commitment; provided, however, that after giving effect to any Borrowing of
Swing Line Loans, (i) the Total Revolving Outstandings shall not exceed the
Aggregate Revolving Commitments, and (ii) the aggregate Outstanding Amount of
the Revolving Loans of any Lender, plus such Lender's Pro Rata Share of the
Outstanding Amount of all L/C Obligations, plus such Lender's Pro Rata Share of
the Outstanding Amount of all Swing Line Loans shall not exceed such Lender's
Revolving Commitment, and provided, further, that the Borrower shall not use the
proceeds of any Swing Line Loan to refinance any outstanding Swing Line Loan.
Within the foregoing limits, and subject to the other terms and conditions
hereof, the Borrower may borrow under this Section 2.04,
33
prepay under Section 2.05, and reborrow under this Section 2.04. Each Swing Line
Loan shall be a Base Rate Loan. Immediately upon the making of a Swing Line
Loan, each Lender shall be deemed to, and hereby irrevocably and unconditionally
agrees to, purchase from the Swing Line Lender a risk participation in such
Swing Line Loan in an amount equal to the product of such Lender's Pro Rata
Share times the amount of such Swing Line Loan.
(b) Borrowing Procedures. Each Borrowing of Swing Line Loans shall be made
upon the Borrower's irrevocable notice to the Swing Line Lender and the
Administrative Agent, which may be given by telephone. Each such notice must be
received by the Swing Line Lender and the Administrative Agent not later than
1:00 p.m. on the requested borrowing date, and shall specify (i) the amount to
be borrowed, which shall be a minimum principal amount of $100,000, or a whole
multiple of $100,000 in excess thereof, and (ii) the requested borrowing date,
which shall be a Business Day. Each such telephonic notice must be confirmed
promptly by delivery to the Swing Line Lender and the Administrative Agent of a
written Swing Line Loan Notice, appropriately completed and signed by a
Responsible Officer of the Borrower. Promptly after receipt by the Swing Line
Lender of any telephonic Swing Line Loan Notice, the Swing Line Lender will
confirm with the Administrative Agent (by telephone or in writing) that the
Administrative Agent has also received such Swing Line Loan Notice and, if not,
the Swing Line Lender will notify the Administrative Agent (by telephone or in
writing) of the contents thereof. Unless the Swing Line Lender has received
notice (by telephone or in writing) from the Administrative Agent (including at
the request of any Lender) prior to 2:00 p.m. on the date of the proposed
Borrowing of Swing Line Loans (A) directing the Swing Line Lender not to make
such Swing Line Loan as a result of the limitations set forth in the proviso to
the first sentence of Section 2.04(a), or (B) that one or more of the applicable
conditions specified in Article V is not then satisfied, then, subject to the
terms and conditions hereof, the Swing Line Lender will, not later than 3:00
p.m. on the borrowing date specified in such Swing Line Loan Notice, make the
amount of its Swing Line Loan available to the Borrower.
(c) Refinancing of Swing Line Loans.
(i) The Swing Line Lender at any time in its sole and absolute
discretion may request, on behalf of the Borrower (which hereby
irrevocably requests and authorizes the Swing Line Lender to so request on
its behalf), that each Lender make a Base Rate Loan in an amount equal to
such Lender's Pro Rata Share of the amount of Swing Line Loans then
outstanding. Such request shall be made in writing (which written request
shall be deemed to be a Loan Notice for purposes hereof) and in accordance
with the requirements of Section 2.02, without regard to the minimum and
multiples specified therein for the principal amount of Base Rate Loans,
but subject to the unutilized portion of the Aggregate Revolving
Commitments and the conditions set forth in Section 5.02. The Swing Line
Lender shall furnish the Borrower with a copy of the applicable Loan
Notice promptly after delivering such notice to the Administrative Agent.
Each Lender shall make an amount equal to its Pro Rata Share of the amount
specified in such Loan Notice available to the Administrative Agent in
immediately available funds for the account of the Swing Line Lender at
the Administrative Agent's Office not later than 1:00 p.m. on the day
specified in such Loan Notice, whereupon, subject to Section 2.04(c)(ii),
each Lender that so makes funds available shall be deemed to have made a
Base Rate Loan to the Borrower in such amount. The Administrative Agent
shall remit the funds so received to the Swing Line Lender.
(ii) If for any reason any Swing Line Loan cannot be refinanced by
such a Borrowing of Revolving Loans in accordance with Section 2.04(c)(i),
the request for Base Rate Loans submitted by the Swing Line Lender as set
forth herein shall be deemed to be a request by the Swing Line Lender that
each of the Lenders fund its risk participation in the relevant Swing Line
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Loan and each Lender's payment to the Administrative Agent for the account
of the Swing Line Lender pursuant to Section 2.04(c)(i) shall be deemed
payment in respect of such participation.
(iii) If any Lender fails to make available to the Administrative
Agent for the account of the Swing Line Lender any amount required to be
paid by such Lender pursuant to the foregoing provisions of this Section
2.04(c) by the time specified in Section 2.04(c)(i), the Swing Line Lender
shall be entitled to recover from such Lender (acting through the
Administrative Agent), on demand, such amount with interest thereon for
the period from the date such payment is required to the date on which
such payment is immediately available to the Swing Line Lender at a rate
per annum equal to the Federal Funds Rate from time to time in effect. A
certificate of the Swing Line Lender submitted to any Lender (through the
Administrative Agent) with respect to any amounts owing under this clause
(iii) shall be conclusive absent manifest error.
(iv) Each Lender's obligation to make Revolving Loans or to purchase
and fund risk participations in Swing Line Loans pursuant to this Section
2.04(c) shall be absolute and unconditional and shall not be affected by
any circumstance, including (A) any set-off, counterclaim, recoupment,
defense or other right that such Lender may have against the Swing Line
Lender, the Borrower or any other Person for any reason whatsoever, (B)
the occurrence or continuance of a Default, or (C) any other occurrence,
event or condition, whether or not similar to any of the foregoing;
provided, however, that each Lender's obligation to make Revolving Loans
pursuant to this Section 2.04(c) is subject to the conditions set forth in
Section 5.02. No such purchase or funding of risk participations shall
relieve or otherwise impair the obligation of the Borrower to repay Swing
Line Loans, together with interest as provided herein.
(d) Repayment of Participations.
(i) At any time after any Lender has purchased and funded a risk
participation in a Swing Line Loan, if the Swing Line Lender receives any
payment on account of such Swing Line Loan, the Swing Line Lender will
distribute to such Lender its Pro Rata Share of such payment
(appropriately adjusted, in the case of interest payments, to reflect the
period of time during which such Lender's risk participation was funded)
in the same funds as those received by the Swing Line Lender.
(ii) If any payment received by the Swing Line Lender in respect of
principal or interest on any Swing Line Loan is required to be returned by
the Swing Line Lender under any of the circumstances described in Section
11.06 (including pursuant to any settlement entered into by the Swing Line
Lender in its discretion), each Lender shall pay to the Swing Line Lender
its Pro Rata Share thereof on demand of the Administrative Agent, plus
interest thereon from the date of such demand to the date such amount is
returned, at a rate per annum equal to the Federal Funds Rate. The
Administrative Agent will make such demand upon the request of the Swing
Line Lender.
(e) Interest for Account of Swing Line Lender. The Swing Line Lender shall
be responsible for invoicing the Borrower for interest on the Swing Line Loans.
Until each Lender funds its Revolving Loans that are Base Rate Loans or risk
participation pursuant to this Section 2.04 to refinance such Lender's Pro Rata
Share of any Swing Line Loan, interest in respect of such Pro Rata Share shall
be solely for the account of the Swing Line Lender.
(f) Payments Directly to Swing Line Lender. The Borrower shall make all
payments of principal and interest in respect of the Swing Line Loans directly
to the Swing Line Lender.
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2.05 PREPAYMENTS.
(a) Voluntary Prepayments of Loans.
(i) Revolving Loans. The Borrower may, upon notice from the Borrower
to the Administrative Agent, at any time or from time to time voluntarily
prepay Revolving Loans in whole or in part without premium or penalty;
provided that (i) such notice must be received by the Administrative Agent
not later than 11:00 a.m. (A) three Business Days prior to any date of
prepayment of Eurodollar Rate Loans, and (B) on the date of prepayment of
Base Rate Loans; (ii) any such prepayment of Eurodollar Rate Loans shall
be in a principal amount of $1,000,000 or a whole multiple of $100,000 in
excess thereof (or, if less, the entire principal amount thereof then
outstanding); (iii) any such prepayment of Base Rate Loans shall be in a
principal amount of $500,000 or a whole multiple of $100,000 in excess
thereof (or, if less, the entire principal amount thereof then
outstanding). Each such notice shall specify the date and amount of such
prepayment and the Type(s) of Loans to be prepaid. The Administrative
Agent will promptly notify each Lender of its receipt of each such notice,
and of the amount of such Lender's Pro Rata Share of such prepayment. If
such notice is given by the Borrower, the Borrower shall make such
prepayment and the payment amount specified in such notice shall be due
and payable on the date specified therein. Any prepayment of a Eurodollar
Rate Loan shall be accompanied by all accrued interest thereon, together
with any additional amounts required pursuant to Section 3.05. Each such
prepayment shall be applied to the Loans of the Lenders in accordance with
their respective Pro Rata Shares.
(ii) Swing Line Loans. The Borrower may, upon notice to the Swing
Line Lender (with a copy to the Administrative Agent), at any time or from
time to time, voluntarily prepay Swing Line Loans in whole or in part
without premium or penalty; provided that (i) such notice must be received
by the Swing Line Lender and the Administrative Agent not later than 1:00
p.m. on the date of the prepayment, and (ii) any such prepayment shall be
in a minimum principal amount of $100,000 or a whole multiple of $100,000
in excess thereof (or, if less, the entire principal amount thereof then
outstanding). Each such notice shall specify the date and amount of such
prepayment. If such notice is given by the Borrower, the Borrower shall
make such prepayment and the payment amount specified in such notice shall
be due and payable on the date specified therein.
(b) Mandatory Prepayments of Loans.
(i) Total Revolving Outstandings. If for any reason the Total
Revolving Outstandings at any time exceed the Aggregate Revolving
Commitments, the Borrower shall immediately prepay Revolving Loans and/or
the Swing Line Loans in an aggregate amount equal to such excess.
(ii) Dispositions and Involuntary Dispositions. The Borrower shall
prepay the Loans as hereafter provided in an aggregate amount equal to
100% of the Net Cash Proceeds of any Disposition or Involuntary
Disposition (each such prepayment to be applied as set forth in clause (v)
below) to the extent (A) such Net Cash Proceeds are not reinvested in
Property useful in the business of the Borrower and its Subsidiaries
within nine (9) months of the date of such Disposition or Involuntary
Disposition, and (B) the aggregate amount of Net Cash Proceeds of all
Dispositions and Involuntary Dispositions not reinvested in accordance
with the foregoing clause (A) shall exceed $2,000,000 in any fiscal year
of the Borrower.
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(iii) Application of Mandatory Prepayments. All amounts required to
be paid pursuant to this Section 2.05(b) shall be applied first to Swing
Line Loans and then (after all Swing Line Loans have been repaid) to
Revolving Loans. Within the parameters of the applications set forth
above, prepayments shall be applied first to Base Rate Loans and then to
Eurodollar Rate Loans in direct order of Interest Period maturities. All
prepayments under this Section 2.05(b) shall be subject to Section 3.05,
but otherwise without premium or penalty, and shall be accompanied by
interest on the principal amount prepaid through the date of prepayment.
2.06 TERMINATION OR REDUCTION OF AGGREGATE REVOLVING COMMITMENTS.
The Borrower may, upon notice from the Borrower to the Administrative
Agent, terminate the Aggregate Revolving Commitments or from time to time
permanently reduce the Aggregate Revolving Commitments to an amount not less
than the Outstanding Amount of Revolving Loans, Swing Line Loans and L/C
Obligations; provided that (i) any such notice shall be received by the
Administrative Agent not later than 11:00 a.m. five Business Days prior to the
date of termination or reduction and (ii) any such partial reduction shall be in
an aggregate amount of $5,000,000 or any whole multiple of $1,000,000 in excess
thereof. The Administrative Agent will promptly notify the Lenders of any such
notice of termination or reduction of the Aggregate Revolving Commitments. Any
reduction of the Aggregate Revolving Commitments shall be applied to the
Revolving Commitment of each Lender according to its Pro Rata Share. All
commitment fees and utilization fees accrued until the effective date of any
termination of the Aggregate Revolving Commitments shall be paid on the
effective date of such termination.
2.07 REPAYMENT OF LOANS.
(a) The Borrower shall repay to the Lenders on the Maturity Date the
aggregate principal amount of all Revolving Loans outstanding on such date.
(b) The Borrower shall repay each Swing Line Loan on the earlier to occur
of (i) demand by the Swing Line Lender and (ii) the Maturity Date.
2.08 INTEREST.
(a) Subject to the provisions of subsection (b) below, (i) each Revolving
Loan that is a Eurodollar Rate Loan shall bear interest on the outstanding
principal amount thereof for each Interest Period at a rate per annum equal to
the sum of (A) the Eurodollar Rate for such Interest Period plus (B) the
Applicable Rate; (ii) each Revolving Loan that is a Base Rate Loan bear interest
on the outstanding principal amount thereof from the applicable borrowing or
conversion date at a rate per annum equal to the Base Rate plus the Applicable
Rate; and (iii) each Swing Line Loan shall bear interest on the outstanding
principal amount thereof from the applicable borrowing date at a rate per annum
equal to the Base Rate plus the Applicable Rate.
(b) Upon the occurrence and during the continuation of an Event of
Default, the Borrower shall pay interest on the principal amount of all
outstanding Obligations at a fluctuating interest rate per annum at all times
equal to the Default Rate to the fullest extent permitted by applicable Laws.
(c) Interest on each Loan shall be due and payable in arrears on each
Interest Payment Date applicable thereto and at such other times as may be
specified herein. Interest hereunder shall be due and payable in accordance with
the terms hereof before and after judgment, and before and after the
commencement of any proceeding under any Debtor Relief Law.
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2.09 FEES.
In addition to certain fees described in subsections (i) and (j) of
Section 2.03:
(a) Commitment Fee. The Borrower shall pay to the Administrative
Agent for the account of each Lender in accordance with its Pro Rata
Share, a commitment fee equal to the product of (i) the Applicable Rate
times (ii) the actual daily amount by which the Aggregate Revolving
Commitments exceed the sum of (y) the Outstanding Amount of Revolving
Loans and (z) the Outstanding Amount of L/C Obligations. The commitment
fee shall accrue at all times during the Availability Period, including at
any time during which one or more of the conditions in Article V is not
met, and shall be due and payable quarterly in arrears on the last
Business Day of each March, June, September and December, commencing with
the first such date to occur after the Closing Date, and on the Maturity
Date. The commitment fee shall be calculated quarterly in arrears, and if
there is any change in the Applicable Rate during any quarter, the actual
daily amount shall be computed and multiplied by the Applicable Rate
separately for each period during such quarter that such Applicable Rate
was in effect. For purposes of clarification, Swing Line Loans shall not
be considered outstanding for purposes of determining the unused portion
of the Aggregate Revolving Commitments.
(b) Other Fees.
(i) The Borrower shall pay to the Arranger and the
Administrative Agent for their own respective accounts fees in the
amounts and at the times specified in the Fee Letter. Such fees
shall be fully earned when paid and shall be non-refundable for any
reason whatsoever.
(ii) The Borrower shall pay to the Lenders such fees as shall
have been separately agreed upon in writing in the amounts and at
the times so specified. Such fees shall be fully earned when paid
and shall not be refundable for any reason whatsoever.
2.10 COMPUTATION OF INTEREST AND FEES.
All computations of interest for Base Rate Loans when the Base Rate is
determined by Bank of America's "prime rate" shall be made on the basis of a
year of 365 or 366 days, as the case may be, and actual days elapsed. All other
computations of fees and interest shall be made on the basis of a 360-day year
and actual days elapsed (which results in more fees or interest, as applicable,
being paid than if computed on the basis of a 365-day year). Interest shall
accrue on each Loan for the day on which the Loan is made, and shall not accrue
on a Loan, or any portion thereof, for the day on which the Loan or such portion
is paid, provided that any Loan that is repaid on the same day on which it is
made shall, subject to Section 2.12(a), bear interest for one day.
2.11 EVIDENCE OF DEBT.
(a) The Credit Extensions made by each Lender shall be evidenced by one or
more accounts or records maintained by such Lender and by the Administrative
Agent in the ordinary course of business. The accounts or records maintained by
the Administrative Agent and each Lender shall be conclusive absent manifest
error of the amount of the Credit Extensions made by the Lenders to the Borrower
and the interest and payments thereon. Any failure to so record or any error in
doing so shall not, however, limit or otherwise affect the obligation of the
Borrower hereunder to pay any amount owing with respect to the Obligations. In
the event of any conflict between the accounts and records maintained by any
Lender and the accounts and records of the Administrative Agent in respect of
such matters, the accounts and records
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of the Administrative Agent shall control in the absence of manifest error. Upon
the request of any Lender made through the Administrative Agent, the Borrower
shall execute and deliver to such Lender (through the Administrative Agent) a
promissory note, which shall evidence such Lender's Loans in addition to such
accounts or records. Each such promissory note shall (i) in the case of
Revolving Loans, be in the form of Exhibit C-1 (a "Revolving Note"), and (ii) in
the case of Swing Line Loans, be in the form of Exhibit C-2 (a "Swing Line
Note"). Each Lender may attach schedules to its Note and endorse thereon the
date, Type (if applicable), amount and maturity of its Loans and payments with
respect thereto.
(b) In addition to the accounts and records referred to in subsection (a),
each Lender and the Administrative Agent shall maintain in accordance with its
usual practice accounts or records evidencing the purchases and sales by such
Lender of participations in Letters of Credit and Swing Line Loans. In the event
of any conflict between the accounts and records maintained by the
Administrative Agent and the accounts and records of any Lender in respect of
such matters, the accounts and records of the Administrative Agent shall control
in the absence of manifest error.
2.12 PAYMENTS GENERALLY.
(a) All payments to be made by the Borrower shall be made without
condition or deduction for any counterclaim, defense, recoupment or setoff.
Except as otherwise expressly provided herein, all payments by the Borrower
hereunder shall be made to the Administrative Agent, for the account of the
respective Lenders to which such payment is owed, at the Administrative Agent's
Office in Dollars and in immediately available funds not later than 2:00 p.m. on
the date specified herein. The Administrative Agent will promptly distribute to
each Lender its Pro Rata Share (or other applicable share as provided herein) of
such payment in like funds as received by wire transfer to such Lender's Lending
Office. All payments received by the Administrative Agent after 2:00 p.m. shall
be deemed received on the next succeeding Business Day and any applicable
interest or fee shall continue to accrue.
(b) Subject to the definition of "Interest Period", if any payment to be
made by the Borrower shall come due on a day other than a Business Day, payment
shall be made on the next following Business Day, and such extension of time
shall be reflected in computing interest or fees, as the case may be.
(c) If at any time insufficient funds are received by and available to the
Administrative Agent to pay fully all amounts of principal, L/C Borrowings,
interest and fees then due hereunder, such funds shall be applied (i) first,
toward costs and expenses (including Attorney Costs and amounts payable under
Article III) incurred by the Administrative Agent, (ii) second, toward costs and
expenses (including Attorney Costs and amounts payable under Article III)
incurred by the Lenders, ratably among the parties entitled thereto in
accordance with the amounts of costs and expenses then due to such parties,
(iii) third, toward repayment of interest and fees then due hereunder, ratably
among the parties entitled thereto in accordance with the amounts of interest
and fees then due to such parties, and (iv) fourth, toward repayment of
principal and L/C Borrowings then due hereunder, ratably among the parties
entitled thereto in accordance with the amounts of principal and L/C Borrowings
then due to such parties.
(d) Unless the Borrower or any Lender has notified the Administrative
Agent, prior to the date any payment is required to be made by it to the
Administrative Agent hereunder, that the Borrower or such Lender, as the case
may be, will not make such payment, the Administrative Agent may assume that the
Borrower or such Lender, as the case may be, has timely made such payment and
may (but shall not be so required to), in reliance thereon, make available a
corresponding amount to the Person entitled thereto. If and to the extent that
such payment was not in fact made to the Administrative Agent in immediately
available funds, then:
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(i) if the Borrower failed to make such payment, each Lender shall
forthwith on demand repay to the Administrative Agent the portion of such
assumed payment that was made available to such Lender in immediately
available funds, together with interest thereon in respect of each day
from and including the date such amount was made available by the
Administrative Agent to such Lender to the date such amount is repaid to
the Administrative Agent in immediately available funds at the Federal
Funds Rate from time to time in effect; and
(ii) if any Lender failed to make such payment, such Lender shall
forthwith on demand pay to the Administrative Agent the amount thereof in
immediately available funds, together with interest thereon for the period
from the date such amount was made available by the Administrative Agent
to the Borrower to the date such amount is recovered by the Administrative
Agent (the "Compensation Period") at a rate per annum equal to the Federal
Funds Rate from time to time in effect. If such Lender pays such amount to
the Administrative Agent, then such amount shall constitute such Lender's
Loan included in the applicable Borrowing. If such Lender does not pay
such amount forthwith upon the Administrative Agent's demand therefor, the
Administrative Agent may make a demand therefor upon the Borrower, and the
Borrower shall pay such amount to the Administrative Agent, together with
interest thereon for the Compensation Period at a rate per annum equal to
the rate of interest applicable to the applicable Borrowing. Nothing
herein shall be deemed to relieve any Lender from its obligation to
fulfill its Revolving Commitment or to prejudice any rights which the
Administrative Agent or the Borrower may have against any Lender as a
result of any default by such Lender hereunder.
A notice of the Administrative Agent to any Lender or the Borrower with
respect to any amount owing under this subsection (d) shall be conclusive,
absent manifest error.
(e) If any Lender makes available to the Administrative Agent funds for
any Loan to be made by such Lender as provided in the foregoing provisions of
this Article II, and such funds are not made available to the Borrower by the
Administrative Agent because the conditions to the applicable Credit Extension
set forth in Article V are not satisfied or waived in accordance with the terms
hereof, the Administrative Agent shall return such funds (in like funds as
received from such Lender) to such Lender, without interest.
(f) The obligations of the Lenders hereunder to make Loans and to fund
participations in Letters of Credit and Swing Line Loans are several and not
joint. The failure of any Lender to make any Loan or to fund any such
participation on any date required hereunder shall not relieve any other Lender
of its corresponding obligation to do so on such date, and no Lender shall be
responsible for the failure of any other Lender to so make its Loan or purchase
its participation.
(g) Nothing herein shall be deemed to obligate any Lender to obtain the
funds for any Loan in any particular place or manner or to constitute a
representation by any Lender that it has obtained or will obtain the funds for
any Loan in any particular place or manner.
2.13 SHARING OF PAYMENTS.
If, other than as expressly provided elsewhere herein, any Lender shall
obtain on account of the Loans made by it, or the participations in L/C
Obligations or in Swing Line Loans held by it (but not including any amounts
applied by the Swing Line Lender to outstanding Swing Line Loans), any payment
(whether voluntary, involuntary, through the exercise of any right of set-off,
or otherwise) in excess of its ratable share (or other share contemplated
hereunder) thereof, such Lender shall immediately (a) notify the Administrative
Agent of such fact, and (b) purchase from the other Lenders such participations
in the
40
Loans made by them and/or such subparticipations in the participations in L/C
Obligations or Swing Line Loans held by them, as the case may be, as shall be
necessary to cause such purchasing Lender to share the excess payment in respect
of such Loans or such participations, as the case may be, pro rata with each of
them; provided, however, that if all or any portion of such excess payment is
thereafter recovered from the purchasing Lender under any of the circumstances
described in Section 11.06 (including pursuant to any settlement entered into by
the purchasing Lender in its discretion), such purchase shall to that extent be
rescinded and each other Lender shall repay to the purchasing Lender the
purchase price paid therefor, together with an amount equal to such paying
Lender's ratable share (according to the proportion of (i) the amount of such
paying Lender's required repayment to (ii) the total amount so recovered from
the purchasing Lender) of any interest or other amount paid or payable by the
purchasing Lender in respect of the total amount so recovered, without further
interest thereon. The Borrower agrees that any Lender so purchasing a
participation from another Lender may, to the fullest extent permitted by law,
exercise all its rights of payment (including the right of set-off, but subject
to Section 11.09) with respect to such participation as fully as if such Lender
were the direct creditor of the Borrower in the amount of such participation.
The Administrative Agent will keep records (which shall be conclusive and
binding in the absence of manifest error) of participations purchased under this
Section and will in each case notify the Lenders following any such purchases or
repayments. Each Lender that purchases a participation pursuant to this Section
shall from and after such purchase have the right to give all notices, requests,
demands, directions and other communications under this Agreement with respect
to the portion of the Obligations purchased to the same extent as though the
purchasing Lender were the original owner of the Obligations purchased.
ARTICLE III
TAXES, YIELD PROTECTION AND ILLEGALITY
3.01 TAXES.
(a) Subject to Section 11.15, any and all payments by any Loan Party to or
for the account of the Administrative Agent or any Lender under any Loan
Document shall be made free and clear of and without deduction for any and all
present or future taxes, duties, levies, imposts, deductions, assessments, fees,
withholdings or similar charges, and all liabilities with respect thereto,
excluding, in the case of the Administrative Agent and each Lender, taxes
imposed on or measured by its overall net income, and franchise taxes imposed on
it (in lieu of net income taxes), by the jurisdiction (or any political
subdivision thereof) under the Laws of which the Administrative Agent or such
Lender, as the case may be, is organized or maintains a lending office (all such
non-excluded taxes, duties, levies, imposts, deductions, assessments, fees,
withholdings or similar charges, and liabilities being hereinafter referred to
as "Taxes"). If any Loan Party shall be required by any Laws to deduct any Taxes
from or in respect of any sum payable under any Loan Document to the
Administrative Agent or any Lender, (i) the sum payable shall be increased as
necessary so that after making all required deductions (including deductions
applicable to additional sums payable under this Section), each of the
Administrative Agent and such Lender receives an amount equal to the sum it
would have received had no such deductions been made, (ii) such Loan Party shall
make such deductions, (iii) such Loan Party shall pay the full amount deducted
to the relevant taxation authority or other authority in accordance with
applicable Laws, and (iv) within thirty days after the date of such payment,
such Loan Party shall furnish to the Administrative Agent (which shall forward
the same to such Lender) the original or a certified copy of a receipt
evidencing payment thereof or if no receipt is available, other evidence of
payment reasonably satisfactory to the Administrative Agent.
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(b) In addition, the Borrower agrees to pay any and all present or future
stamp, court or documentary taxes and any other excise or property taxes or
charges or similar levies which arise from any payment made under any Loan
Document or from the execution, delivery, performance, enforcement or
registration of, or otherwise with respect to, any Loan Document (hereinafter
referred to as "Other Taxes").
(c) If the Borrower shall be required to deduct or pay any Taxes or Other
Taxes from or in respect of any sum payable under any Loan Document to the
Administrative Agent or any Lender, the Borrower shall also pay to the
Administrative Agent or to such Lender, as the case may be, at the time interest
is paid, such additional amount that the Administrative Agent or such Lender
specifies is necessary to preserve the after-tax yield (after factoring in all
taxes, including taxes imposed on or measured by net income) that the
Administrative Agent or such Lender would have received if such Taxes or Other
Taxes had not been deducted or paid.
(d) The Borrower agrees to indemnify the Administrative Agent and each
Lender for (i) the full amount of Taxes and Other Taxes (including any Taxes or
Other Taxes imposed or asserted by any jurisdiction on amounts payable under
this Section) paid by the Administrative Agent and such Lender, (ii) amounts
payable under Section 3.01(c) and (iii) any liability (including additions to
tax, penalties, interest and expenses) arising therefrom or with respect
thereto, in each case whether or not such Taxes or Other Taxes were correctly or
legally imposed or asserted by the relevant Governmental Authority. Payment
under this subsection (d) shall be made within thirty days after the date the
Lender or the Administrative Agent makes a demand therefor.
(e) If any Loan Party is required to pay any amount to any Lender or the
Administrative Agent pursuant to this Section 3.01, then such Lender shall use
reasonable efforts (consistent with legal and regulatory restrictions) to change
the jurisdiction of its Lending Office so as to eliminate any such additional
payment which may thereafter accrue, if such change in the reasonable judgment
of such Lender is not otherwise disadvantageous to such Lender.
3.02 ILLEGALITY.
If any Lender determines that any Law has made it unlawful, or that any
Governmental Authority has asserted that it is unlawful, for any Lender or its
applicable Lending Office to make, maintain or fund Eurodollar Rate Loans, or to
determine or charge interest rates based upon the Eurodollar Rate, then, on
notice thereof by such Lender to the Borrower through the Administrative Agent,
any obligation of such Lender to make or continue Eurodollar Rate Loans or to
convert Base Rate Loans to Eurodollar Rate Loans shall be suspended until such
Lender notifies the Administrative Agent and the Borrower that the circumstances
giving rise to such determination no longer exist. Upon receipt of such notice,
the Borrower shall, upon demand from such Lender (with a copy to the
Administrative Agent), prepay or, if applicable, convert all Eurodollar Rate
Loans of such Lender to Base Rate Loans, either on the last day of the Interest
Period therefor, if such Lender may lawfully continue to maintain such
Eurodollar Rate Loans to such day, or immediately, if such Lender may not
lawfully continue to maintain such Eurodollar Rate Loans. Upon any such
prepayment or conversion, the Borrower shall also pay accrued interest on the
amount so prepaid or converted. Each Lender agrees to designate a different
Lending Office if such designation will avoid the need for such notice and will
not, in the good faith judgment of such Lender, otherwise be materially
disadvantageous to such Lender.
3.03 INABILITY TO DETERMINE RATES.
If the Administrative Agent determines that for any reason adequate and
reasonable means do not exist for determining the Eurodollar Base Rate for any
requested Interest Period with respect to a
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proposed Eurodollar Rate Loan, or that the Eurodollar Base Rate for any
requested Interest Period with respect to a proposed Eurodollar Rate Loan does
not adequately and fairly reflect the cost to the Lenders of funding such Loan,
the Administrative Agent will promptly notify the Borrower and all Lenders.
Thereafter, the obligation of the Lenders to make or maintain Eurodollar Rate
Loans shall be suspended until the Administrative Agent revokes such notice.
Upon receipt of such notice, the Borrower may revoke any pending request for a
Borrowing of, conversion to or continuation of Eurodollar Rate Loans or, failing
that, will be deemed to have converted such request into a request for a
Borrowing of Base Rate Loans in the amount specified therein.
3.04 INCREASED COST AND REDUCED RETURN; CAPITAL ADEQUACY.
(a) If any Lender determines that as a result of the introduction of or
any change in or in the interpretation of any Law, or such Lender's compliance
therewith, there shall be any increase in the cost to such Lender of agreeing to
make or making, funding or maintaining Eurodollar Rate Loans or (as the case may
be) issuing or participating in Letters of Credit, or a reduction in the amount
received or receivable by such Lender in connection with any of the foregoing
(excluding for purposes of this subsection (a) any such increased costs or
reduction in amount resulting from (i) Taxes or Other Taxes (as to which Section
3.01 shall govern), (ii) changes in the basis of taxation of overall net income
or overall gross income by the United States or any foreign jurisdiction or any
political subdivision of either thereof under the Laws of which such Lender is
organized or has its Lending Office, and (iii) reserve requirements utilized, as
to Eurodollar Rate Loans, in the determination of the Eurodollar Rate), then
from time to time upon demand of such Lender (with a copy of such demand to the
Administrative Agent), the Borrower shall pay to such Lender such additional
amounts as will compensate such Lender for such increased cost or reduction.
(b) If any Lender determines that the introduction of any Law regarding
capital adequacy or any change therein or in the interpretation thereof, or
compliance by such Lender (or its Lending Office) therewith, has the effect of
reducing the rate of return on the capital of such Lender or any corporation
controlling such Lender as a consequence of such Lender's obligations hereunder
(taking into consideration its policies with respect to capital adequacy and
such Lender's desired return on capital), then from time to time upon demand of
such Lender (with a copy of such demand to the Administrative Agent), the
Borrower shall pay to such Lender such additional amounts as will compensate
such Lender for such reduction.
3.05 FUNDING LOSSES.
Upon demand of any Lender (with a copy to the Administrative Agent) from
time to time, the Borrower shall promptly compensate such Lender for and hold
such Lender harmless from any loss, cost or expense incurred by it as a result
of:
(a) any continuation, conversion, payment or prepayment of any Loan
other than a Base Rate Loan on a day other than the last day of the
Interest Period for such Loan (whether voluntary, mandatory, automatic, by
reason of acceleration, or otherwise);
(b) any failure by the Borrower (for a reason other than the failure
of such Lender to make a Loan) to prepay, borrow, continue or convert any
Loan other than a Base Rate Loan on the date or in the amount notified by
the Borrower; or
(c) any assignment of a Eurodollar Rate Loan on a day other than the
last day of the Interest Period therefor as a result of (i) a request by
the Borrower pursuant to Section 11.16 or (ii) an assignment by Bank of
America pursuant to Section 11.07(b) as part of the primary
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syndication of the Commitments and Loans during the 180-day period
immediately following the Closing Date;
including any loss of anticipated profits and any loss or expense arising
from the liquidation or reemployment of funds obtained by it to maintain
such Loan or from fees payable to terminate the deposits from which such
funds were obtained. The Borrower shall also pay any customary
administrative fees charged by such Lender in connection with the
foregoing.
For purposes of calculating amounts payable by the Borrower to the Lenders
under this Section 3.05, each Lender shall be deemed to have funded each
Eurodollar Rate Loan made by it at the Eurodollar Base Rate used in determining
the Eurodollar Rate for such Loan by a matching deposit or other borrowing in
the London interbank eurodollar market for a comparable amount and for a
comparable period, whether or not such Eurodollar Rate Loan was in fact so
funded.
3.06 MATTERS APPLICABLE TO ALL REQUESTS FOR COMPENSATION.
(a) A certificate of the Administrative Agent or any Lender claiming
compensation under this Article III and setting forth the additional amount or
amounts to be paid to it hereunder shall be conclusive in the absence of
manifest error. In determining such amount, the Administrative Agent or such
Lender may use any reasonable averaging and attribution methods.
(b) Upon any Lender's making a claim for compensation under Section 3.01
or 3.04, the Borrower may replace such Lender in accordance with Section 11.16.
3.07 SURVIVAL.
All of the Borrower's obligations under this Article III shall survive
termination of the Aggregate Revolving Commitments and repayment of all
Obligations.
ARTICLE IV
GUARANTY
4.01 THE GUARANTY.
Each of the Guarantors hereby jointly and severally guarantees to each
Lender, each Affiliate of a Lender that enters into a Swap Contract or Treasury
Management Agreement, and the Administrative Agent as hereinafter provided, as
primary obligor and not as surety, the prompt payment of the Obligations in full
when due (whether at stated maturity, as a mandatory prepayment, by
acceleration, as a mandatory cash collateralization or otherwise) strictly in
accordance with the terms thereof. The Guarantors hereby further agree that if
any of the Obligations are not paid in full when due (whether at stated
maturity, as a mandatory prepayment, by acceleration, as a mandatory cash
collateralization or otherwise), the Guarantors will, jointly and severally,
promptly pay the same, without any demand or notice whatsoever, and that in the
case of any extension of time of payment or renewal of any of the Obligations,
the same will be promptly paid in full when due (whether at extended maturity,
as a mandatory prepayment, by acceleration, as a mandatory cash
collateralization or otherwise) in accordance with the terms of such extension
or renewal.
Notwithstanding any provision to the contrary contained herein or in any
other of the Loan Documents, Swap Contracts or Treasury Management Agreements,
the obligations of each Guarantor under this Agreement and the other Loan
Documents shall be limited to an aggregate amount equal to the largest
44
amount that would not render such obligations subject to avoidance under the
Debtor Relief Laws or any comparable provisions of any applicable state law.
4.02 OBLIGATIONS UNCONDITIONAL.
The obligations of the Guarantors under Section 4.01 are joint and
several, absolute and unconditional, irrespective of the value, genuineness,
validity, regularity or enforceability of any of the Loan Documents, Swap
Contracts or Treasury Management Agreements, or any other agreement or
instrument referred to therein, or any substitution, release, impairment or
exchange of any other guarantee of or security for any of the Obligations, and,
to the fullest extent permitted by applicable law, irrespective of any other
circumstance whatsoever which might otherwise constitute a legal or equitable
discharge or defense of a surety or guarantor, it being the intent of this
Section 4.02 that the obligations of the Guarantors hereunder shall be absolute
and unconditional under any and all circumstances. Each Guarantor agrees that
such Guarantor shall have no right of subrogation, indemnity, reimbursement or
contribution against the Borrower or any other Guarantor for amounts paid under
this Article IV until such time as the Obligations have been paid in full and
the Aggregate Revolving Commitments have expired or terminated. Without limiting
the generality of the foregoing, it is agreed that, to the fullest extent
permitted by law, the occurrence of any one or more of the following shall not
alter or impair the liability of any Guarantor hereunder, which shall remain
absolute and unconditional as described above:
(a) at any time or from time to time, without notice to any
Guarantor, the time for any performance of or compliance with any of the
Obligations shall be extended, or such performance or compliance shall be
waived;
(b) any of the acts mentioned in any of the provisions of any of the
Loan Documents, any Swap Contract or Treasury Management Agreement between
any Loan Party and any Lender, or any Affiliate of a Lender, or any other
agreement or instrument referred to in the Loan Documents or such Swap
Contracts or Treasury Management Agreements shall be done or omitted;
(c) the maturity of any of the Obligations shall be accelerated, or
any of the Obligations shall be modified, supplemented or amended in any
respect, or any right under any of the Loan Documents, any Swap Contract
or Treasury Management Agreement between any Loan Party and any Lender, or
any Affiliate of a Lender, or any other agreement or instrument referred
to in the Loan Documents or such Swap Contracts or Treasury Management
Agreements shall be waived or any other guarantee of any of the
Obligations or any security therefor shall be released, impaired or
exchanged in whole or in part or otherwise dealt with;
(d) any Lien granted to, or in favor of, the Administrative Agent or
any Lender or Lenders as security for any of the Obligations shall fail to
attach or be perfected; or
(e) any of the Obligations shall be determined to be void or
voidable (including, without limitation, for the benefit of any creditor
of any Guarantor) or shall be subordinated to the claims of any Person
(including, without limitation, any creditor of any Guarantor).
With respect to its obligations hereunder, each Guarantor hereby expressly
waives diligence, presentment, demand of payment, protest and all notices
whatsoever, and any requirement that the Administrative Agent or any Lender
exhaust any right, power or remedy or proceed against any Person under any of
the Loan Documents, any Swap Contract or Treasury Management Agreement between
any Loan Party and any Lender, or any Affiliate of a Lender, or any other
agreement or instrument referred to in the Loan Documents or such Swap Contracts
or Treasury Management Agreements, or against any other Person under any other
guarantee of, or security for, any of the Obligations.
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4.03 REINSTATEMENT.
The obligations of the Guarantors under this Article IV shall be
automatically reinstated if and to the extent that for any reason any payment by
or on behalf of any Person in respect of the Obligations is rescinded or must be
otherwise restored by any holder of any of the Obligations, whether as a result
of any proceedings in bankruptcy or reorganization or otherwise, and each
Guarantor agrees that it will indemnify the Administrative Agent and each Lender
on demand for all reasonable costs and expenses (including, without limitation,
reasonable fees and expenses of counsel) incurred by the Administrative Agent or
such Lender in connection with such rescission or restoration, including any
such reasonable costs and expenses incurred in defending against any claim
alleging that such payment constituted a preference, fraudulent transfer or
similar payment under any bankruptcy, insolvency or similar law.
4.04 CERTAIN ADDITIONAL WAIVERS.
Each Guarantor agrees that such Guarantor shall have no right of recourse
to security for the Obligations, except through the exercise of rights of
subrogation pursuant to Section 4.02 and through the exercise of rights of
contribution pursuant to Section 4.06.
4.05 REMEDIES.
The Guarantors agree that, to the fullest extent permitted by law, as
between the Guarantors, on the one hand, and the Administrative Agent and the
Lenders, on the other hand, the Obligations may be declared to be forthwith due
and payable as provided in Section 9.02 (and shall be deemed to have become
automatically due and payable in the circumstances provided in said Section
9.02) for purposes of Section 4.01 notwithstanding any stay, injunction or other
prohibition preventing such declaration (or preventing the Obligations from
becoming automatically due and payable) as against any other Person and that, in
the event of such declaration (or the Obligations being deemed to have become
automatically due and payable), the Obligations (whether or not due and payable
by any other Person) shall forthwith become due and payable by the Guarantors
for purposes of Section 4.01. The Guarantors acknowledge and agree that their
obligations hereunder are secured in accordance with the terms of the Collateral
Documents and that the Lenders may exercise their remedies thereunder in
accordance with the terms thereof.
4.06 RIGHTS OF CONTRIBUTION.
The Guarantors agree among themselves that, in connection with payments
made hereunder, each Guarantor shall have contribution rights against the other
Guarantors as permitted under applicable law. Such contribution rights shall be
subordinate and subject in right of payment to the obligations of such
Guarantors under the Loan Documents and no Guarantor shall exercise such rights
of contribution until all Obligations have been paid in full and the Commitments
have terminated.
4.07 GUARANTEE OF PAYMENT; CONTINUING GUARANTEE.
The guarantee in this Article IV is a guaranty of payment and not of
collection, is a continuing guarantee, and shall apply to all Obligations
whenever arising.
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ARTICLE V
CONDITIONS PRECEDENT TO CREDIT EXTENSIONS
5.01 CONDITIONS OF INITIAL CREDIT EXTENSION.
The obligation of each Lender to make its initial Credit Extension
hereunder is subject to satisfaction of the following conditions precedent:
(a) Loan Documents. Receipt by the Administrative Agent of executed
counterparts of this Agreement and the other Loan Documents, each properly
executed by a Responsible Officer of the signing Loan Party and, in the
case of this Agreement, by each Lender.
(b) Organization Documents, Resolutions, Etc. Receipt by the
Administrative Agent of the following, each of which shall be originals or
facsimiles (followed promptly by originals), dated as of a recent date
before the Closing Date and in form and substance satisfactory to the
Administrative Agent and its legal counsel:
(i) copies of the Organization Documents of each Loan Party
certified to be true and complete as of a recent date by the
appropriate Governmental Authority of the state or other
jurisdiction of its incorporation or organization, where applicable,
and certified by a secretary or assistant secretary of such Loan
Party to be true and correct as of the Closing Date;
(ii) such certificates of resolutions or other action,
incumbency certificates and/or other certificates of Responsible
Officers of each Loan Party as the Administrative Agent may require
evidencing the identity, authority and capacity of each Responsible
Officer thereof authorized to act as a Responsible Officer in
connection with this Agreement and the other Loan Documents to which
such Loan Party is a party; and
(iii) such documents and certifications as the Administrative
Agent may reasonably require to evidence that each Loan Party is
duly organized or formed, and is validly existing, in good standing
and qualified to engage in business in its state of organization or
formation and the state in which its principal place of business is
located.
(c) Opinion of Counsel. Receipt by the Administrative Agent of
favorable opinions of counsel to the Loan Parties, addressed to the
Administrative Agent and each Lender, dated as of the Closing Date, and in
form and substance satisfactory to the Administrative Agent.
(d) Perfection and Priority of Liens. Receipt by the Administrative
Agent of the following:
(i) searches of Uniform Commercial Code filings in the
jurisdiction of formation of each Loan Party, copies of the
financing statements on file in such jurisdictions and evidence that
no Liens exist other than Permitted Liens;
(ii) all certificates evidencing any certificated Capital
Stock pledged to the Administrative Agent pursuant to the Pledge
Agreement, together with duly executed in blank, undated stock
powers attached thereto (unless, with respect to the pledged Capital
Stock of any Foreign Subsidiary, such stock powers are deemed
unnecessary by the
47
Administrative Agent in its reasonable discretion under the law of
the jurisdiction of incorporation of such Person);
(iii) searches of ownership of, and Liens on, intellectual
property of each Loan Party in the appropriate governmental offices;
and
(iv) duly executed notices of grant of security interest in
the form required by the Security Agreement as are necessary, in the
Administrative Agent's sole discretion, to perfect the
Administrative Agent's security interest in the intellectual
property of the Loan Parties.
(e) Financial Statements. The Administrative Agent shall have
received:
(i) the Audited Financial Statements;
(ii) the Interim Financial Statements;
(iii) such other information as the Administrative Agent may
reasonably request.
(f) No Material Adverse Change. There shall not have occurred a
material adverse change since December 31, 2003 in the business, assets,
liabilities (actual or contingent), operations, financial condition or
prospects of the Borrower and its Subsidiaries, taken as a whole.
(g) Evidence of Insurance. Receipt by the Administrative Agent of
copies of insurance policies or certificates of insurance of the Borrower
and its Subsidiaries evidencing liability and casualty insurance meeting
the requirements set forth in the Loan Documents, including, but not
limited to, naming the Administrative Agent as additional insured (in the
case of liability insurance) or loss payee (in the case of hazard
insurance) on behalf of the Lenders.
(h) Subordinated Indebtedness Documents. The Administrative Agent
shall have received a copy, certified by a Responsible Officer of the
Borrower as true and complete, of all amendments and modifications, if
any, to the Senior Subordinated Notes Documents.
(i) Closing Certificate. Receipt by the Administrative Agent of a
certificate signed by a Responsible Officer of the Borrower certifying
that the conditions specified in Section 5.01(f) and Sections 5.02(a), (b)
and (c) have been satisfied.
(j) Fees. Receipt by the Administrative Agent and the Lenders of any
fees required to be paid on or before the Closing Date.
(k) Attorney Costs. Unless waived by the Administrative Agent, the
Borrower shall have paid all Attorney Costs of the Administrative Agent to
the extent invoiced prior to or on the Closing Date, plus such additional
amounts of Attorney Costs as shall constitute its reasonable estimate of
Attorney Costs incurred or to be incurred by it through the closing
proceedings (provided that such estimate shall not thereafter preclude a
final settling of accounts between the Borrower and the Administrative
Agent).
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5.02 CONDITIONS TO ALL CREDIT EXTENSIONS.
The obligation of each Lender to honor any Request for Credit Extension is
subject to the following conditions precedent:
(a) The representations and warranties of each Loan Party contained
in Article VI or any other Loan Document, or which are contained in any
document furnished at any time under or in connection herewith or
therewith, shall be true and correct in all material respects on and as of
the date of such Credit Extension, except to the extent that such
representations and warranties specifically refer to an earlier date, in
which case they shall be true and correct as of such earlier date, and
except that for purposes of this Section 5.02, the representations and
warranties contained in subsections (a) and (b) of Section 6.05 shall be
deemed to refer to the most recent statements furnished pursuant to
clauses (a) and (b), respectively, of Section 7.01.
(b) No Default shall exist, or would result from such proposed
Credit Extension.
(c) There shall not have been commenced against the Borrower or any
Subsidiary an involuntary case under any applicable Debtor Relief Law, now
or hereafter in effect, or any case, proceeding or other action for the
appointment of a receiver, liquidator, assignee, custodian, trustee,
sequestrator (or similar official) of such Person or for any substantial
part of its Property or for the winding up or liquidation of its affairs,
and such involuntary case or other case, proceeding or other action shall
remain undismissed.
(d) If after giving effect to such Credit Extension the aggregate
principal amount of all "Indebtedness" (as such term is defined in the
Subordinated Indenture) outstanding under the Credit Agreement would
exceed $85 million, the Borrower shall have delivered to the
Administrative Agent a certificate signed by a Responsible Officer of the
Borrower that:
(i) certifies that after giving effect to such Credit
Extension, all of the Obligations shall constitute "Senior Debt"
under the Senior Subordinated Notes Documents;
(ii) identifies the provision of Section 4.09 of the
Subordinated Indenture under which such Credit Extension is incurred
(it being understood that the Borrower shall designate clause (1) of
the definition of "Permitted Debt" in Section 4.09 of the
Subordinated Indenture to the extent the Borrower has availability
under such clause); and
(iii) contains reasonably detailed calculations demonstrating
that such Credit Extension may be incurred under such provision of
Section 4.09 of the Subordinated Indenture.
(e) The Administrative Agent and, if applicable, the L/C Issuer or
the Swing Line Lender shall have received a Request for Credit Extension
in accordance with the requirements hereof.
Each Request for Credit Extension submitted by the Borrower shall be
deemed to be a representation and warranty that the conditions specified in
Sections 5.02(a), (b) and (c) have been satisfied on and as of the date of the
applicable Credit Extension.
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ARTICLE VI
REPRESENTATIONS AND WARRANTIES
The Loan Parties represent and warrant to the Administrative Agent and the
Lenders that:
6.01 EXISTENCE, QUALIFICATION AND POWER.
Each Loan Party (a) is a corporation, partnership or limited liability
company duly organized or formed, validly existing and in good standing under
the Laws of the jurisdiction of its incorporation or organization, (b) has all
requisite power and authority and all requisite governmental licenses,
authorizations, consents and approvals to (i) own its assets and carry on its
business and (ii) execute, deliver and perform its obligations under the Loan
Documents to which it is a party, and (c) is duly qualified and is licensed and
in good standing under the Laws of each jurisdiction where its ownership, lease
or operation of properties or the conduct of its business requires such
qualification or license; except in each case referred to in clause (b)(i) or
(c), to the extent that failure to do so could not reasonably be expected to
have a Material Adverse Effect.
6.02 AUTHORIZATION; NO CONTRAVENTION.
The execution, delivery and performance by each Loan Party of each Loan
Document to which such Person is party, have been duly authorized by all
necessary corporate or other organizational action, and do not (a) contravene
the terms of any Loan Party's Organization Documents; (b) conflict with or
result in any breach or contravention of, or the creation of any Lien under, (i)
any Contractual Obligation to which any Loan Party is a party or (ii) any order,
injunction, writ or decree of any Governmental Authority or any arbitral award
to which any Loan Party or the Property of any Loan Party is subject; (c)
violate any Law (including, without limitation, Regulation U or Regulation X
issued by the FRB); or (d) result in a limitation on any licenses, permits or
other approvals applicable to the business, operations or properties of any Loan
Party or adversely affect the ability of any Loan Party to participate in any
Medical Reimbursement Programs.
6.03 GOVERNMENTAL AUTHORIZATION; OTHER CONSENTS.
No approval, consent, exemption, authorization, or other action by, or
notice to, or filing with, any Governmental Authority or any other Person is
necessary or required in connection with the execution, delivery or performance
by, or enforcement against, any Loan Party of this Agreement or any other Loan
Document, other than (i) those that have already been obtained and are in full
force and effect and (ii) filings to perfect the Liens created by the Collateral
Documents.
6.04 BINDING EFFECT.
Each Loan Document has been duly executed and delivered by each Loan Party
that is party thereto. Each Loan Document constitutes a legal, valid and binding
obligation of each Loan Party that is party thereto, enforceable against each
such Loan Party in accordance with its terms, except as enforceability may be
limited by applicable Debtor Relief Laws or by equitable principles relating to
enforceability.
6.05 FINANCIAL STATEMENTS; NO MATERIAL ADVERSE EFFECT.
(a) The Audited Financial Statements (i) were prepared in accordance with
GAAP consistently applied throughout the period covered thereby, except as
otherwise expressly noted therein;
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(ii) fairly present in all material respects the financial condition of the
Borrower and its Subsidiaries as of the date thereof and their results of
operations for the period covered thereby in accordance with GAAP consistently
applied throughout the period covered thereby, except as otherwise expressly
noted therein; and (iii) show all material indebtedness and other liabilities,
direct or contingent, of the Borrower and its Subsidiaries as of the date
thereof, including liabilities for taxes, commitments and Indebtedness.
(b) The Interim Financial Statements (i) were prepared in accordance with
GAAP consistently applied throughout the period covered thereby, except as
otherwise expressly noted therein; (ii) fairly present in all material respects
the financial condition of the Borrower and its Subsidiaries as of the date
thereof and their results of operations for the period covered thereby, subject,
in the case of clauses (i) and (ii), to the absence of footnotes and to normal
year-end audit adjustments; and (iii) show all material indebtedness and other
liabilities, direct or contingent, of the Borrower and its Subsidiaries as of
the date thereof, including liabilities for taxes, material commitments and
Indebtedness.
(c) From the date of the Audited Financial Statements to and including the
Closing Date, there has been no Disposition by the Borrower or any Subsidiary,
or any Involuntary Disposition, of any material part of the business or Property
of the Borrower and its Subsidiaries, taken as a whole, and no purchase or other
acquisition by any of them of any business or property (including any Capital
Stock of any other Person) material in relation to the consolidated financial
condition of the Borrower and its Subsidiaries, taken as a whole, in each case,
which is not reflected in the foregoing financial statements or in the notes
thereto and has not otherwise been disclosed in writing to the Lenders on or
prior to the Closing Date.
(d) The financial statements delivered pursuant to Section 7.01(a) and (b)
have been prepared in accordance with GAAP (except as may otherwise be permitted
under Section 7.01(a) and (b)) and present fairly (on the basis disclosed in the
footnotes to such financial statements) in all material respects the
consolidated financial condition, results of operations and cash flows of the
Borrower and its Subsidiaries as of the dates thereof and for the periods
covered thereby.
(e) Since the date of the Audited Financial Statements there has been no
event or circumstance that has had or could reasonably be expected to have a
Material Adverse Effect.
6.06 LITIGATION.
There are no actions, suits, investigations, criminal prosecutions, civil
investigative demands, imposition of criminal or civil fines or penalties,
proceedings, claims or disputes pending or, to the knowledge of the Loan
Parties, threatened or contemplated, at law, in equity, in arbitration or before
any Governmental Authority, by or against the Borrower or any of its
Subsidiaries or against any of their properties or revenues that (a) purport to
affect or pertain to this Agreement or any other Loan Document, or (b) if
determined adversely, could reasonably be expected to have a Material Adverse
Effect.
6.07 NO DEFAULT.
(a) Neither the Borrower nor any Subsidiary is in default under or with
respect to any Contractual Obligation that could reasonably be expected to have
a Material Adverse Effect.
(b) No Default has occurred and is continuing.
6.08 OWNERSHIP OF PROPERTY; LIENS.
Each of the Borrower and its Subsidiaries has good record and marketable
title in fee simple to, or valid leasehold interests in, all real property
necessary or used in the ordinary conduct of its business,
51
except for such defects in title as could not, individually or in the aggregate,
reasonably be expected to have a Material Adverse Effect. The Property of the
Borrower and its Subsidiaries is subject to no Liens, other than Permitted
Liens.
6.09 ENVIRONMENTAL COMPLIANCE.
Except as could not reasonably be expected to have a Material Adverse
Effect:
(a) Each of the Facilities and all operations at the Facilities are
in compliance with all applicable Environmental Laws, and there is no
violation of any Environmental Law with respect to the Facilities or the
Businesses, and there are no conditions relating to the Facilities or the
Businesses that could give rise to liability under any applicable
Environmental Laws.
(b) None of the Facilities contains, or has previously contained,
any Hazardous Materials at, on or under the Facilities in amounts or
concentrations that constitute or constituted a violation of, or could
give rise to liability under, Environmental Laws.
(c) Neither the Borrower nor any Subsidiary has received any written
or verbal notice of, or inquiry from any Governmental Authority regarding,
any violation, alleged violation, non-compliance, liability or potential
liability regarding environmental matters or compliance with Environmental
Laws with regard to any of the Facilities or the Businesses, nor does any
Responsible Officer of any Loan Party have knowledge or reason to believe
that any such notice will be received or is being threatened.
(d) Hazardous Materials have not been transported or disposed of
from the Facilities, or generated, treated, stored or disposed of at, on
or under any of the Facilities or any other location, in each case by or
on behalf the Borrower or any Subsidiary in violation of, or in a manner
that would be reasonably likely to give rise to liability under, any
applicable Environmental Law.
(e) No judicial proceeding or governmental or administrative action
is pending or, to the knowledge of the Responsible Officers of the Loan
Parties, threatened, under any Environmental Law to which the Borrower or
any Subsidiary is or will be named as a party, nor are there any consent
decrees or other decrees, consent orders, administrative orders or other
orders, or other administrative or judicial requirements outstanding under
any Environmental Law with respect to the Borrower, any Subsidiary, the
Facilities or the Businesses.
(f) There has been no release or, threat of release of Hazardous
Materials at or from the Facilities, or arising from or related to the
operations (including, without limitation, disposal) of the Borrower or
any Subsidiary in connection with the Facilities or otherwise in
connection with the Businesses, in violation of or in amounts or in a
manner that could give rise to liability under Environmental Laws.
6.10 INSURANCE.
The properties of the Borrower and its Subsidiaries are insured with
financially sound and reputable insurance companies, in such amounts, with such
deductibles and covering such risks as are customarily carried by companies
engaged in similar businesses and owning similar properties in localities where
the Borrower or the applicable Subsidiary operates.
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6.11 TAXES.
The Borrower and its Subsidiaries have filed all federal, state and other
material tax returns and reports required to be filed, and have paid all
federal, state and other material taxes, assessments, fees and other
governmental charges levied or imposed upon them or their properties, income or
assets otherwise due and payable, except those which are being contested in good
faith by appropriate proceedings diligently conducted and for which adequate
reserves have been provided in accordance with GAAP. There is no proposed tax
assessment against the Borrower or any Subsidiary that would, if made, have a
Material Adverse Effect.
6.12 ERISA COMPLIANCE.
(a) Each Plan is in compliance in all material respects with the
applicable provisions of ERISA, the Internal Revenue Code and other federal or
state Laws. Each Plan that is intended to qualify under Section 401(a) of the
Internal Revenue Code has received a favorable determination letter from the IRS
or an application for such a letter is currently being processed by the IRS with
respect thereto and, to the knowledge of the Loan Parties, nothing has occurred
which would prevent, or cause the loss of, such qualification. Each Loan Party
and each ERISA Affiliate have made all required contributions to each Plan
subject to Section 412 of the Internal Revenue Code, and no application for a
funding waiver or an extension of any amortization period pursuant to Section
412 of the Internal Revenue Code has been made with respect to any Plan.
(b) There are no pending or, to the knowledge of the Loan Parties,
threatened claims, actions or lawsuits, or action by any Governmental Authority,
with respect to any Plan that could be reasonably be expected to have a Material
Adverse Effect. There has been no prohibited transaction or violation of the
fiduciary responsibility rules with respect to any Plan that has resulted or
could reasonably be expected to result in a Material Adverse Effect.
(c) (i) No ERISA Event has occurred or is reasonably expected to occur;
(ii) no Pension Plan has any Unfunded Pension Liability; (iii) no Loan Party or
any ERISA Affiliate has incurred, or reasonably expects to incur, any liability
under Title IV of ERISA with respect to any Pension Plan (other than premiums
due and not delinquent under Section 4007 of ERISA); (iv) no Loan Party or any
ERISA Affiliate has incurred, or reasonably expects to incur, any liability (and
no event has occurred which, with the giving of notice under Section 4219 of
ERISA, would result in such liability) under Sections 4201 or 4243 of ERISA with
respect to a Multiemployer Plan; and (v) no Loan Party or any ERISA Affiliate
has engaged in a transaction that could be subject to Section 4069 or 4212(c) of
ERISA.
6.13 SUBSIDIARIES.
Set forth on Schedule 6.13 is a complete and accurate list as of the
Closing Date of each Subsidiary (other than any Immaterial Subsidiary), together
with the percentage of outstanding shares of each class owned (directly or
indirectly) by the Borrower or any Subsidiary. None of the shares of Capital
Stock of any Subsidiary is subject to any outstanding options, warrants, rights
of conversion or purchase and all other similar rights with respect thereto. The
outstanding Capital Stock of each Subsidiary is validly issued, fully paid and
non-assessable.
6.14 MARGIN REGULATIONS; INVESTMENT COMPANY ACT; PUBLIC UTILITY HOLDING COMPANY
ACT.
(a) The Borrower is not engaged and will not engage, principally or as one
of its important activities, in the business of purchasing or carrying margin
stock (within the meaning of Regulation U issued by the FRB), or extending
credit for the purpose of purchasing or carrying margin stock.
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Following the application of the proceeds of each Borrowing or drawing under
each Letter of Credit, not more than 25% of the value of the assets (either of
the Borrower only or of the Borrower and its Subsidiaries on a consolidated
basis) subject to the provisions of Section 8.01 or Section 8.05 or subject to
any restriction contained in any agreement or instrument between the Borrower
and any Lender or any Affiliate of any Lender relating to Indebtedness and
within the scope of Section 9.01(e) will be margin stock.
(b) None of the Borrower, any Person Controlling the Borrower or any
Subsidiary (i) is a "holding company," or a "subsidiary company" of a "holding
company," or an "affiliate" of a "holding company" or of a "subsidiary company"
of a "holding company," within the meaning of the Public Utility Holding Company
Act of 1935, or (ii) is or is required to be registered as an "investment
company" under the Investment Company Act of 1940.
6.15 DISCLOSURE.
No report, financial statement, certificate or other information furnished
(whether in writing or orally) by or on behalf of any Loan Party to the
Administrative Agent or any Lender in connection with the transactions
contemplated hereby and the negotiation of this Agreement or delivered hereunder
(as modified or supplemented by other information so furnished) contains any
material misstatement of fact or omits to state any material fact necessary to
make the statements therein, in the light of the circumstances under which they
were made, not misleading; provided that, with respect to projected financial
information, the Loan Parties represent only that such information was prepared
in good faith based upon assumptions believed to be reasonable at the time.
6.16 COMPLIANCE WITH LAWS.
(a) Each of the Borrower and each Subsidiary is in compliance with the
requirements of all Laws (including, without limitation, Medicare Regulations,
Medicaid Regulations, HIPAA, 42 U.S.C. Section 1320a-7b and 42 U.S.C. Section
1395nn) and all orders, writs, injunctions, decrees, licenses and permits
applicable to it, its properties or the Facilities, except in such instances in
which (i) such requirement of Law or order, writ, injunction or decree is being
contested in good faith by appropriate proceedings diligently conducted or (ii)
the failure to comply therewith could not reasonably be expected to have a
Material Adverse Effect. Without limiting the generality of the foregoing:
(A) neither the Borrower nor any Subsidiary, nor any individual
employed by the Borrower or any Subsidiary, would reasonably be expected
to have criminal culpability or to be excluded from participation in any
Medical Reimbursement Program for corporate or individual actions or
failures to act known to the Borrower or any Subsidiary where such
culpability or exclusion has resulted or could reasonably be expected to
result in an Exclusion Event;
(B) to the knowledge of the Loan Parties, no officer or other member
of management continues to be employed by the Borrower or any Subsidiary
who may reasonably be expected to have individual culpability for matters
under investigation by the OIG or other Governmental Authority unless such
officer or other member of management has been, within a reasonable period
of time after discovery of such actual or potential culpability, either
suspended or removed from positions of responsibility related to those
activities under challenge by the OIG or other Governmental Authority;
(C) current billing policies, arrangements, protocols and
instructions of the Borrower and its Subsidiaries comply with requirements
of Medical Reimbursement Programs and are
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administered by properly trained personnel, except where any such failure
to comply would not reasonably be expected to result in an Exclusion
Event; and
(D) current medical director compensation arrangements of the
Borrower and its Subsidiaries comply with state and federal anti-kickback,
fraud and abuse, and self-referral laws, including without limitation 42
U.S.C. Section 1320a-7b and 42 U.S.C. Section 1395nn, and all regulations
promulgated under such laws, except where any such failure to comply would
not reasonably be expected to result in an Exclusion Event.
(b) The Borrower has in place a compliance program for the Borrower and
its Subsidiaries that is reasonably designed to provide effective internal
controls that promote adherence to, prevent and detect material violations of,
any Laws applicable to the Borrower and its Subsidiaries, and which includes the
implementation of internal audits and monitoring on a regular basis to monitor
compliance with the compliance program and with Laws.
6.17 INTELLECTUAL PROPERTY; LICENSES, ETC.
The Borrower and its Subsidiaries own, or possess the legal right to use,
all of the trademarks, service marks, trade names, copyrights, patents, patent
rights, franchises, licenses and other intellectual property rights
(collectively, "IP Rights") that are reasonably necessary for the operation of
their respective businesses, without conflict with the rights of any other
Person. Set forth on Schedule 6.17 is a list of all IP Rights registered or
pending registration with the United States Copyright Office or the United
States Patent and Trademark Office and owned by any Loan Party, or that any Loan
Party has the right to use, as of the Closing Date. Except for such claims and
infringements that could not reasonably be expected to have a Material Adverse
Effect, no claim has been asserted and is pending by any Person challenging or
questioning the use of any IP Rights or the validity or effectiveness of any IP
Rights, nor does any Loan Party know of any such claim, and, to the knowledge of
the Responsible Officers of the Loan Parties, the use of any IP Rights by the
Borrower or any Subsidiary or the granting of a right or a license in respect of
any IP Rights from the Borrower or any Subsidiary does not infringe on the
rights of any Person. As of the Closing Date, none of the IP Rights owned by any
of the Loan Parties is subject to any licensing agreement or similar arrangement
except as set forth on Schedule 6.17.
6.18 BROKER'S FEES.
Neither the Borrower nor any Subsidiary has any obligation to any Person
in respect of any finder's, broker's, investment banking or other similar fee in
connection with any of the transactions contemplated under the Loan Documents.
6.19 LABOR MATTERS.
There are no collective bargaining agreements or Multiemployer Plans
covering the employees of the Borrower or any Subsidiary as of the Closing Date
and neither the Borrower nor any Subsidiary has suffered any strikes, walkouts,
work stoppages or other material labor difficulty within the last five years.
6.20 BUSINESS LOCATIONS.
Set forth on Schedule 6.20(a) is a list of all real property located in
the United States that is owned or leased by any Loan Party as of the Closing
Date. Set forth on Schedule 6.20(b) is a list of all locations where any
tangible personal property of any Loan Party is located as of the Closing Date.
Set forth on Schedule 6.20(c) is the chief executive office, tax payer
identification number and organizational identification number of each Loan
Party as of the Closing Date. The exact legal name and state of
55
organization of each Loan Party is as set forth on the signature pages hereto.
Except as set forth on Schedule 6.20(e), no Loan Party has during the five years
preceding the Closing Date (i) changed its legal name, (ii) changed its state of
formation, or (iii) been party to a merger, consolidation or other change in
structure.
6.21 PERFECTION OF SECURITY INTERESTS IN THE COLLATERAL.
The Collateral Documents create valid security interests in, and Liens on,
the Collateral purported to be covered thereby, which security interests and
Liens are currently perfected security interests and Liens, prior to all other
Liens other than Permitted Liens.
6.22 SUBORDINATION.
(a) The Obligations are "Senior Debt" under the Senior Subordinated Notes
Documents.
(b) The Obligations are "Designated Senior Debt" under the Senior
Subordinated Notes Documents and no other Indebtedness or other obligations
constitute "Designated Senior Debt" under the Senior Subordinated Notes
Documents.
(c) The Obligations are "Senior Debt" under the Sunrise Subordination
Agreement.
6.23 FRAUD AND ABUSE.
To the knowledge of the Responsible Officers of the Loan Parties, neither
the Borrower nor any Subsidiary nor any of their respective officers or
directors has engaged in any activities that are prohibited under any applicable
provision of the Social Security Act and the regulations promulgated thereunder,
including HIPAA, the Medicare Regulations or the Medicaid Regulations that could
reasonably be expected to have a Material Adverse Effect.
6.24 LICENSING AND ACCREDITATION.
(a) Except to the extent it would not reasonably be expected to have a
Material Adverse Effect, each of the Borrower and its Subsidiaries has, to the
extent applicable: (i) obtained (or been duly assigned) all required
certificates of need or determinations of need as required by the relevant state
Governmental Authority for the acquisition, construction, expansion of,
investment in or operation of its businesses and Facilities as currently
operated; (ii) obtained and maintains in good standing all required licenses,
permits, authorizations and approvals of each Governmental Authority necessary
to the conduct of its business and Facilities; (iii) to the extent prudent and
customary in the industry in which it is engaged, obtained and maintains
accreditation from all generally recognized accrediting agencies; (iv) entered
into and maintains in good standing its Medicare Provider Agreements and
Medicaid Provider Agreements; and (v) ensured that all such required licenses
are in full force and effect on the date hereof and have not been revoked or
suspended or otherwise limited.
(b) To the knowledge of the Loan Parties, each Contract Provider is duly
licensed by each state, state agency, commission or other Governmental Authority
having jurisdiction over the provision of such services by such Person in the
locations where the Borrower and its Subsidiaries conduct business, to the
extent such licensing is required to enable such Person to provide the
professional services provided by such Person and otherwise as is necessary to
enable the Borrower and its Subsidiaries to operate as currently operated and as
contemplated to be operated.
6.26 REIMBURSEMENT FROM MEDICAL REIMBURSEMENT PROGRAMS.
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The accounts receivable of Borrower and its Subsidiaries have been and
will continue to be adjusted to reflect the reimbursement policies (both those
most recently published in writing as well as those not in writing which have
been verbally communicated) of Medical Reimbursement Programs, including without
limitation Medicare, Medicaid, Blue Cross/Blue Shield, private insurance
companies, health maintenance organizations, preferred provider organizations,
alternative delivery systems, managed care systems, government contracting
agencies and other third party payors. In particular, accounts receivable
relating to such Medical Reimbursement Programs do not and shall not exceed in
any material respect amounts any obligee is entitled to receive under any
capitation arrangement, fee schedule, discount formula, cost-based reimbursement
or other adjustment or limitation to its usual charges.
6.27 MEDICARE AND MEDICAID NOTICES AND FILINGS RELATED TO HEALTH CARE BUSINESS.
With respect to Borrower and its Subsidiaries, to the extent applicable
and except to the extent as would not be reasonably be expected to have a
Material Adverse Effect: (i) each has timely filed all reports required to be
filed in connection with Medicare and applicable Medicaid programs and due on or
before the date hereof, and all required reports and administrative forms and
filings are true and complete in all material respects; (ii) there are no
claims, actions, proceedings or appeals pending (and neither Borrower nor any of
its Subsidiaries has filed anything that would result in any claims, actions or
appeals) before any Governmental Authority with respect to any Medicare or
Medicaid cost reports or claims filed by the Borrower or any of its Subsidiaries
on or before the date hereof, or with respect to any adjustments, denials,
recoupments or disallowances by any intermediary, carrier, other insurer,
commission, board or agency in connection with any cost reports or claims; (iii)
no validation review, survey, inspection, audit, investigation or program
integrity review related to the Borrower or any Subsidiary has been conducted by
any Governmental Authority or government contractor in connection with the
Medicare or Medicaid programs, and no such reviews are scheduled, pending or,
threatened against or affecting the Borrower or any Subsidiary; and (iv) each
has timely filed all material reports, data and other information required by
any other Governmental Authority with authority to regulate the Borrower or any
Subsidiary or its business in any manner.
ARTICLE VII
AFFIRMATIVE COVENANTS
So long as any Lender shall have any Revolving Commitment hereunder, any
Loan or other Obligation hereunder shall remain unpaid or unsatisfied, or any
Letter of Credit shall remain outstanding, the Loan Parties shall and shall
cause each Subsidiary to:
7.01 FINANCIAL STATEMENTS.
Deliver to the Administrative Agent and each Lender, in form and detail
satisfactory to the Administrative Agent and the Required Lenders:
(a) as soon as available, but in any event within ninety (90) days
after the end of each fiscal year of the Borrower, consolidated and
consolidating balance sheets of the Borrower and its Subsidiaries as at
the end of such fiscal year, and the related consolidated and
consolidating statements of income or operations, retained earnings,
shareholders' equity and cash flows for such fiscal year, setting forth in
each case in comparative form the figures as of the end of and for the
previous fiscal year, all in reasonable detail and prepared in accordance
with GAAP, audited and accompanied by a report and opinion of Ernst &
Young or other independent
57
certified public accountants of nationally recognized standing reasonably
acceptable to the Required Lenders, which report and opinion shall be
prepared in accordance with generally accepted auditing standards and
shall not be subject to any "going concern" or like qualification or
exception or any qualification or exception as to the scope of such audit;
and
(b) as soon as available, but in any event within forty-five (45)
days after the end of each of the first three fiscal quarters of each
fiscal year of the Borrower, consolidated and consolidating balance sheets
of the Borrower and its Subsidiaries as at the end of such fiscal quarter,
and the related consolidated and consolidating statements of income or
operations, retained earnings, shareholders' equity and cash flows for
such fiscal quarter and for the portion of the Borrower's fiscal year then
ended, setting forth in each case in comparative form the figures as of
the end of and for the corresponding fiscal quarter of the previous fiscal
year and the corresponding portion of the previous fiscal year, all in
reasonable detail and certified by a Responsible Officer of the Borrower
as fairly presenting in all material respects the financial condition,
results of operations, shareholders' equity and cash flows of the Borrower
and its Subsidiaries in accordance with GAAP, subject only to normal
year-end audit adjustments and the absence of footnotes.
As to any information contained in materials furnished pursuant to Section
7.02(f)(i), the Borrower shall not be separately required to furnish such
information under clause (a) or (b) above, but the foregoing shall not be
in derogation of the obligation of the Borrower to furnish the information
and materials described in subsections (a) and (b) above at the times
specified therein.
7.02 CERTIFICATES; OTHER INFORMATION.
Deliver to the Administrative Agent and each Lender, in form and detail
satisfactory to the Administrative Agent and the Required Lenders:
(a) concurrently with the delivery of the financial statements
referred to in Section 7.01(a), a certificate of its independent certified
public accountants certifying such financial statements and stating that
in making the examination necessary therefor no knowledge was obtained of
any Default under any of the financial covenants contained in Section 8.11
or, if any such Default shall exist, stating the nature and status of such
event;
(b) concurrently with the delivery of the financial statements
referred to in Sections 7.01(a) and (b), a duly completed Compliance
Certificate signed by a Responsible Officer of the Borrower;
(c) within sixty (60) days after end of each fiscal year, the annual
business plan and budget of the Borrower and its Subsidiaries containing,
among other things, projected financial statements for each quarter of the
next fiscal year;
(d) copies of any detailed audit reports, management letters or
recommendations submitted to the board of directors (or the audit
committee of the board of directors) of the Borrower by independent
accountants in connection with the accounts or books of the Borrower or
any Subsidiary, or any audit of any of them;
(e) promptly after the same are available, (i) copies of each annual
report, proxy or financial statement or other report or communication sent
to the stockholders of the Borrower, and copies of all annual, regular,
periodic and special reports and registration statements which
58
the Borrower may file or be required to file with the SEC under Section 13
or 15(d) of the Securities Exchange Act of 1934 or to a holder of any
Indebtedness owed by the Borrower or any Subsidiary in its capacity as
such a holder and not otherwise required to be delivered to the
Administrative Agent pursuant hereto and (ii) upon the request of the
Administrative Agent, all reports and written information to and from the
United States Environmental Protection Agency, or any state or local
agency responsible for environmental matters, the United States
Occupational Health and Safety Administration, or any state or local
agency responsible for health and safety matters, or any successor
agencies or authorities concerning environmental, health or safety
matters; and
(f) promptly, such additional information regarding the business,
financial or corporate affairs of the Borrower or any Subsidiary, or
compliance with the terms of the Loan Documents, as the Administrative
Agent or any Lender may from time to time reasonably request.
Documents required to be delivered pursuant to Section 7.01(a) or (b) or
Section 7.02(e) may (to the extent any such documents are included in materials
otherwise filed with the SEC) be delivered electronically and if so delivered,
shall be deemed to have been delivered on the date (i) on which the Borrower
posts such documents, or provides a link thereto on the Borrower's website on
the Internet at the website address listed on Schedule 11.02; or (ii) on which
such documents are posted on the Borrower's behalf on IntraLinks/IntraAgency or
another relevant website, if any, to which each Lender and the Administrative
Agent have access (whether a commercial, third-party website or whether
sponsored by the Administrative Agent); provided that: (i) the Borrower shall
deliver paper copies of such documents to the Administrative Agent or any Lender
that requests the Borrower to deliver such paper copies until a written request
to cease delivering paper copies is given by the Administrative Agent or such
Lender and (ii) the Borrower shall notify (which may be by facsimile or
electronic mail) the Administrative Agent and each Lender of the posting of any
such documents and provide to the Administrative Agent by electronic mail
electronic versions (i.e., soft copies) of such documents. Notwithstanding
anything contained herein, in every instance the Borrower shall be required to
provide paper copies of the Compliance Certificates required by Section 7.02(b)
to the Administrative Agent and each of the Lenders. Except for such Compliance
Certificates, the Administrative Agent shall have no obligation to request the
delivery or to maintain copies of the documents referred to above, and in any
event shall have no responsibility to monitor compliance by the Borrower with
any such request for delivery, and each Lender shall be solely responsible for
requesting delivery to it or maintaining its copies of such documents.
7.03 NOTICES.
(a) Promptly (and in any event within five (5) Business Days) after any
Loan Party obtains knowledge thereof, notify the Administrative Agent and each
Lender of the occurrence of any Default.
(b) Promptly after any Loan Party obtains knowledge thereof, notify the
Administrative Agent and each Lender of any matter that has resulted or could
reasonably be expected to result in a Material Adverse Effect.
(c) Promptly after any Loan Party obtains knowledge thereof, notify the
Administrative Agent and each Lender of the occurrence of any ERISA Event.
(d) Promptly notify the Administrative Agent and each Lender of any
material change in accounting policies or financial reporting practices by the
Borrower or any Subsidiary.
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(e) Promptly after any Loan Party obtains knowledge thereof, notify the
Administrative Agent and each Lender of any litigation, investigation or
proceeding affecting any Loan Party in which the amount involved or relief
sought would reasonably be expected to have a Material Adverse Effect; and
(f) Promptly after any Loan Party obtains knowledge thereof, notify the
Administrative Agent and each Lender (i) the institution of any investigation,
review or proceeding against any Loan Party to suspend, revoke or terminate (or
that may result in the termination of) any Medicaid Provider Agreement or
Medicare Provider Agreement, or any such investigation or proceeding that may
result in an Exclusion Event or (ii) any notice of loss or threatened loss of
accreditation, loss of participation under any Medical Reimbursement Program or
loss of applicable health care license, in the case of clauses (i) and (ii),
that would reasonably be expected to result in a Material Adverse Effect.
(g) Upon the reasonable written request of the Administrative Agent
following the occurrence of any event or the discovery of any condition which
the Administrative Agent or the Required Lenders reasonably believe has caused
(or could be reasonably expected to cause) the representations and warranties
set forth in Section 6.09 to be untrue in any material respect, furnish or cause
to be furnished to the Administrative Agent, at the Loan Parties' expense, a
report of an environmental assessment of reasonable scope, form and depth,
(including, where appropriate, invasive soil or groundwater sampling) by a
consultant reasonably acceptable to the Administrative Agent as to the nature
and extent of the presence of any Materials of Environmental Concern on any
Facilities and as to the compliance by the Borrower or any of its Subsidiaries
with Environmental Laws at such Facilities. If the Loan Parties fail to deliver
such an environmental report within seventy-five (75) days after receipt of such
written request then the Administrative Agent may arrange for same, and the Loan
Parties hereby grant to the Administrative Agent and its representatives access
to the Facilities to reasonably undertake such an assessment (including, where
appropriate, invasive soil or groundwater sampling). The reasonable cost of any
assessment arranged for by the Administrative Agent pursuant to this provision
will be payable by the Loan Parties on demand and added to the obligations
secured by the Collateral Documents.
Each notice pursuant to this Section 7.03 shall be accompanied by a
statement of a Responsible Officer of the Borrower setting forth details of the
occurrence referred to therein and stating what action the Borrower has taken
and proposes to take with respect thereto. Each notice pursuant to Section
7.03(a) shall describe with particularity any and all provisions of this
Agreement and any other Loan Document that have been breached.
7.04 PAYMENT OF OBLIGATIONS.
Pay and discharge as the same shall become due and payable, all its
obligations and liabilities, including (a) all tax liabilities, assessments and
governmental charges or levies upon it or its properties or assets, unless the
same are being contested in good faith by appropriate proceedings diligently
conducted and adequate reserves in accordance with GAAP are being maintained by
the Borrower or such Subsidiary; and (b) all lawful claims which, if unpaid,
would by law become a Lien upon its Property unless the same are being contested
in good faith by appropriate proceedings diligently conducted and adequate
reserves in accordance with GAAP are being maintained by the Borrower or such
Subsidiary.
7.05 PRESERVATION OF EXISTENCE, ETC.
(a) Preserve, renew and maintain in full force and effect its legal
existence under the Laws of the jurisdiction of its organization except in a
transaction permitted by Section 8.04 or 8.05.
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(b) Preserve, renew and maintain in full force and effect its good
standing under the Laws of the jurisdiction of its organization, except to the
extent the failure to do so could not reasonably be expected to have a Material
Adverse Effect.
(c) Take all reasonable action to maintain all rights, privileges,
permits, licenses, franchises, certifications and approvals as are necessary for
the conduct of its business as currently conducted and herein contemplated,
including without limitation professional licenses, CLIA certifications,
Medicare Provider Agreements and Medicaid Provider Agreements, except to the
extent the failure to do so could not reasonably be expected to have a Material
Adverse Effect.
(d) Preserve or renew all of its material registered patents, copyrights,
trademarks, trade names and service marks, except to the extent the failure to
do so could not reasonably be expected to have a Material Adverse Effect.
7.06 MAINTENANCE OF PROPERTIES.
(a) Maintain, preserve and protect all of its material properties and
equipment necessary in the operation of its business in good working order and
condition, ordinary wear and tear and Involuntary Dispositions excepted.
(b) Make all necessary repairs thereto and renewals and replacements
thereof, except to the extent the failure to do so could not reasonably be
expected to have a Material Adverse Effect.
(c) Use the standard of care typical in the industry in the operation and
maintenance of its facilities.
7.07 MAINTENANCE OF INSURANCE.
Maintain in full force and effect insurance (including worker's
compensation insurance, liability insurance, casualty insurance, business
interruption insurance and reinsurance) with financially sound and reputable
insurance companies, in such amounts, with such deductibles and covering such
risks as are customarily carried by companies engaged in similar businesses and
owning similar properties in localities where the Borrower or the applicable
Subsidiary operates. The Administrative Agent shall be named as loss payee or
mortgagee, as its interest may appear, and/or additional insured with respect to
any such insurance providing coverage in respect of any Collateral, and each
provider of any such insurance shall agree, by endorsement upon the policy or
policies issued by it or by independent instruments furnished to the
Administrative Agent, that it will give the Administrative Agent thirty (30)
days prior written notice before any such policy or policies shall be altered or
canceled.
7.08 COMPLIANCE WITH LAWS.
Except the extent the failure to do so would not reasonably be expected to
result in a Material Adverse Effect:
(a) Comply with the requirements of all Laws (including without
limitation Titles XVIII and XIX of the Social Security Act, HIPAA,
Medicare Regulations, Medicaid Regulations) and all orders, writs,
injunctions and decrees applicable to it or to its business or Property,
except in such instances in which such requirement of Law or order, writ,
injunction or decree is being contested in good faith by appropriate
proceedings diligently conducted;
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(b) Ensure that (i) billing policies, arrangements, protocols and
instructions will comply with reimbursement requirements under Medicare,
Medicaid and other Medical Reimbursement Programs and will be administered
by properly trained personnel; and (ii) medical director compensation
arrangements and other arrangements with referring physicians will comply
with applicable state and federal self-referral and anti-kickback laws,
including without limitation 42 U.S.C. Section 1320a-7b(b)(1) - (b)(2) 42
U.S.C. and 42 U.S.C. Section 1395nn; and
(c) Make commercially reasonable efforts to implement policies that
are consistent with HIPAA on or before the date that any provision of
HIPAA becomes applicable to the Borrower and its Subsidiaries.
7.09 BOOKS AND RECORDS.
(a) Maintain proper books of record and account, in which full, true and
correct entries in conformity with GAAP consistently applied shall be made of
all financial transactions and matters involving the assets and business of the
Borrower or such Subsidiary, as the case may be.
(b) Maintain such books of record and account in material conformity with
all applicable requirements of any Governmental Authority having regulatory
jurisdiction over the Borrower or such Subsidiary, as the case may be.
7.10 INSPECTION RIGHTS.
(a) Permit representatives and independent contractors of the
Administrative Agent and each Lender to visit and inspect any of its properties,
to examine its corporate, financial and operating records, and make copies
thereof or abstracts therefrom, and to discuss its affairs, finances and
accounts with its directors, officers, and independent public accountants
(provided that the Borrower shall be provided an opportunity to attend such
meetings), all at the expense of the Lenders and at such reasonable times during
normal business hours and as often as may be reasonably desired, upon reasonable
advance notice to the Borrower; provided, however, that when an Event of Default
exists the Administrative Agent or any Lender (or any of their respective
representatives or independent contractors) may do any of the foregoing at the
expense of the Borrower at any time during normal business hours and without
advance notice.
(b) Permit representatives and independent contractors of the
Administrative Agent to conduct an annual audit of the Collateral at the expense
of the Borrower upon reasonable advance notice to the Borrower. To the extent
required by applicable Law, prior to receiving any information that contains
patient information subject to (i) state privacy laws, (ii) the Drug Abuse
Prevention, Treatment and Xxxxxxxxxxxxxx Xxx, 00 X.X.X. 000xx-0 et seq., (iii)
the Health Insurance Portability and Accountability Act of 1996, 42 U.S.C. 1320d
et seq., or (iv) regulations promulgated pursuant to the foregoing statutes, the
Administrative Agent and the Lenders agree to execute an agreement reasonably
satisfactory to the Administrative Agent and the Lenders that complies with the
requirements relating to "business associates" as set forth in 45 C.F.R. 502(e)
and any applicable state Laws.
7.11 USE OF PROCEEDS.
Use the proceeds of the Credit Extensions (a) to refinance Indebtedness of
the Borrower under its existing revolving credit facility, (b) to finance
working capital, capital expenditures and other general corporate purposes and
(c) to finance Permitted Acquisitions, provided that in no event shall be the
proceeds of the Credit Extensions be used in contravention of any Law or of any
Loan Document.
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7.12 ADDITIONAL SUBSIDIARIES.
(a) Within thirty (30) days after the acquisition or formation of any
Subsidiary:
(i) notify the Administrative Agent thereof in writing, together
with (i) jurisdiction of formation, (ii) number of shares of each class of
Capital Stock outstanding, (iii) number and percentage of outstanding
shares of each class owned (directly or indirectly) by the Borrower or any
Subsidiary and (iv) number and effect, if exercised, of all outstanding
options, warrants, rights of conversion or purchase and all other similar
rights with respect thereto; and
(ii) cause such Subsidiary (other than any Excluded Subsidiary) to
(A) become a Guarantor by executing and delivering to the Administrative
Agent a Joinder Agreement or such other document as the Administrative
Agent shall deem appropriate for such purpose, and (B) deliver to the
Administrative Agent documents of the types referred to in Sections
5.01(b) and (d) and favorable opinions of counsel to such Person (which
shall cover, among other things, the legality, validity, binding effect
and enforceability of the documentation referred to in clause (a)), all in
form, content and scope reasonably satisfactory to the Administrative
Agent; provided, however, (x) if such Subsidiary is a Foreign Subsidiary
and compliance with clause (A) above would reasonably be expected to cause
any material adverse tax consequences to the Borrower, then such
Subsidiary shall not be required to comply with this clause (ii) and (y)
if such Subsidiary is an Immaterial Subsidiary, then such Subsidiary shall
not be required to comply with this clause (ii) so long as the aggregate
amount of assets owned by all Immaterial Subsidiaries that are not
Guarantors does not, as of any date of determination, exceed $250,000 in
the aggregate.
(b) Guarantee of Subordinated Indebtedness. If any Subsidiary that is not
a Guarantor (including any Foreign Subsidiary, any Excluded Subsidiary and any
Immaterial Subsidiary) provides a Guarantee in respect of any Subordinated
Indebtedness, such Subsidiary shall, concurrent with providing the Guarantee in
respect of such Subordinated Indebtedness, (i) become a Guarantor by executing
and delivering to the Administrative Agent a Joinder Agreement or such other
document as the Administrative Agent shall deem appropriate for such purpose,
and (ii) deliver to the Administrative Agent documents of the types referred to
in Sections 5.01(b) and (d) and favorable opinions of counsel to such Person
(which shall cover, among other things, the legality, validity, binding effect
and enforceability of the documentation referred to in clause (a)), all in form,
content and scope reasonably satisfactory to the Administrative Agent.
7.13 ERISA COMPLIANCE.
Do, and cause each of its ERISA Affiliates to do, each of the following:
(a) maintain each Plan in compliance in all material respects with the
applicable provisions of ERISA, the Internal Revenue Code and other federal or
state law; (b) cause each Plan that is qualified under Section 401(a) of the
Internal Revenue Code to maintain such qualification; and (c) make all required
contributions to any Plan subject to Section 412 of the Internal Revenue Code.
7.14 PLEDGED ASSETS.
At all times, (a) cause all of the owned and leased Property (other than
Excluded Property) of each Loan Party to be subject at all times to first
priority, perfected Liens and, in the case of owned and leased real property,
title insured Liens in favor of the Administrative Agent to secure the
Obligations pursuant to the terms and conditions of the Collateral Documents or,
with respect to any such Property acquired subsequent to the Closing Date, such
other additional security documents as the Administrative
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Agent shall reasonably request, subject in any case to Permitted Liens and (b)
deliver such other documentation as the Administrative Agent may reasonably
request in connection with the foregoing, including, without limitation,
appropriate UCC-1 financing statements, real estate title insurance policies,
surveys, environmental reports, landlord's waivers, certified resolutions and
other organizational and authorizing documents of such Person, favorable
opinions of counsel to such Person (which shall cover, among other things, the
legality, validity, binding effect and enforceability of the documentation
referred to above and the perfection of the Administrative Agent's Liens
thereunder) and other items of the types required to be delivered pursuant to
Section 5.01(d), all in form, content and scope reasonably satisfactory to the
Administrative Agent.
Without limiting the generality of the above, the Loan Parties will cause
(a) 100% of the issued and outstanding Capital Stock of each Domestic Subsidiary
(other than any Immaterial Subsidiary that is not a Guarantor) and (b) 65% (or
such greater percentage that, due to a change in an applicable Law after the
date hereof, (1) could not reasonably be expected to cause the undistributed
earnings of such Foreign Subsidiary as determined for United States federal
income tax purposes to be treated as a deemed dividend to such Foreign
Subsidiary's United States parent and (2) could not reasonably be expected to
cause any material adverse tax consequences) of the issued and outstanding
Capital Stock entitled to vote (within the meaning of Treas. Reg. Section
1.956-2(c)(2)) and 100% of the issued and outstanding Capital Stock not entitled
to vote (within the meaning of Treas. Reg. Section 1.956-2(c)(2)) in each
Foreign Subsidiary (other than any Immaterial Subsidiary) directly owned by the
Borrower or any Domestic Subsidiary to be subject at all times to a first
priority, perfected Lien in favor of the Administrative Agent pursuant to the
terms and conditions of the Collateral Documents or such other security
documents as the Administrative Agent shall reasonably request.
With respect to each Account for which either the perfection,
enforceability, or validity of the Administrative Agent's Liens in such Account,
or the Administrative Agent's right or ability to obtain direct payment to the
Administrative Agent of the proceeds of such Account, is governed by any
federal, state, or local statutory requirements other than those of the Uniform
Commercial Code, the Loan Parties will take such steps as the Administrative
Agent may from time to time reasonably request, including, without limitation,
compliance with the Federal Assignment of Claims Act of 1940, as amended, the
Social Security Act, the Medicare Regulations and the Medicaid Regulations.
With respect to real property pledged to the Administrative Agent to
secure the Obligations, the Loan Parties shall be required to deliver title
insurance policies and surveys (a) only to the extent necessary to cause the
aggregate net book value of all real property pledged to the Administrative
Agent to secure the Obligations for which the Loan Parties have delivered title
insurance policies and surveys to equal or exceed $150 million or (b) if the
Loan Parties obtain owners coverage title insurance for the applicable real
property.
7.15 POST-CLOSING MATTERS.
Within sixty (60) days of the Closing Date the Borrower shall deliver to
the Administrative Agent a favorable opinion of counsel to each Subsidiary
formed under the laws of the State of Texas, addressed to the Administrative
Agent and each Lender and in form and substance satisfactory to the
Administrative Agent (such opinion shall cover, among other things, the
authorization, execution and enforceability of the Loan Documents to which such
Subsidiaries are party).
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ARTICLE VIII
NEGATIVE COVENANTS
So long as any Lender shall have any Revolving Commitment hereunder, any
Loan or other Obligation hereunder shall remain unpaid or unsatisfied, or any
Letter of Credit shall remain outstanding, no Loan Party shall, nor shall it
permit any Subsidiary to, directly or indirectly:
8.01 LIENS.
Create, incur, assume or suffer to exist any Lien upon any of its
Property, whether now owned or hereafter acquired, other than the following:
(a) Liens pursuant to any Loan Document;
(b) Liens existing on the date hereof and listed on Schedule 8.01
and any renewals or extensions thereof, provided that the Property covered
thereby is not increased and any renewal or extension of the obligations
secured or benefited thereby is permitted by Section 8.03(b);
(c) Liens (other than Liens imposed under ERISA) for taxes,
assessments or governmental charges or levies not yet due or which are
being contested in good faith and by appropriate proceedings diligently
conducted, if adequate reserves with respect thereto are maintained on the
books of the applicable Person in accordance with GAAP;
(d) statutory Liens of landlords and Liens of carriers,
warehousemen, mechanics, materialmen and suppliers and other Liens imposed
by law or pursuant to customary reservations or retentions of title
arising in the ordinary course of business, provided that such Liens
secure only amounts not yet due and payable or, if due and payable, are
unfiled and no other action has been taken to enforce the same or are
being contested in good faith by appropriate proceedings for which
adequate reserves determined in accordance with GAAP have been
established;
(e) pledges or deposits in the ordinary course of business in
connection with workers' compensation, unemployment insurance and other
social security legislation, other than any Lien imposed by ERISA;
(f) deposits to secure the performance of bids, trade contracts,
licenses and leases (other than Indebtedness), statutory obligations,
surety bonds (other than bonds related to judgments or litigation),
performance bonds and other obligations of a like nature incurred in the
ordinary course of business;
(g) easements, rights-of-way, restrictions and other similar
encumbrances affecting real property which, in the aggregate, are not
substantial in amount, and which do not in any case materially detract
from the value of the property subject thereto or materially interfere
with the ordinary conduct of the business of the applicable Person;
(h) Liens securing judgments for the payment of money (or appeal or
other surety bonds relating to such judgments) not in excess of the
Threshold Amount (except to the extent covered by independent third-party
insurance as to which the insurer has acknowledged in writing its
obligation to cover), unless any such judgment remains undischarged for a
period of more than thirty (30) consecutive days during which execution is
not effectively stayed;
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(i) Liens securing Indebtedness permitted under Section 8.03(c);
provided that (i) such Liens do not at any time encumber any Property
other than the Property financed by such Indebtedness, (ii) the
Indebtedness secured thereby does not exceed the cost or fair market
value, whichever is lower, of the Property being acquired on the date of
acquisition and (iii) such Liens attach to such Property concurrently with
or within ninety days after the acquisition thereof;
(j) leases, licenses or subleases granted to others not interfering
in any material respect with the business of the Borrower or any
Subsidiary;
(k) any interest of title of a lessor under, and Liens arising from
UCC financing statements (or equivalent filings, registrations or
agreements in foreign jurisdictions) relating to, leases permitted by this
Agreement;
(l) Liens deemed to exist in connection with Investments in
repurchase agreements permitted under Section 8.02;
(m) normal and customary rights of setoff upon deposits of cash in
favor of banks or other depository institutions;
(n) Liens of a collection bank arising under Section 4-210 of the
Uniform Commercial Code on items in the course of collection;
(o) Liens created or deemed to exist by the establishment of trusts
for the purpose of satisfying (i) Governmental Reimbursement Program Costs
and (ii) other actions or claims pertaining to the same or related matters
or other Medical Reimbursement Programs, provided that the Borrower, in
each case, shall have established adequate reserves for such claims or
actions;
(p) Liens of sellers of goods to the Borrower and any of its
Subsidiaries arising under Article 2 of the Uniform Commercial Code or
similar provisions of applicable law in the ordinary course of business,
covering only the goods sold and securing only the unpaid purchase price
for such goods and related expenses;
(q) Liens on the Property of PSI Surety created or deemed to exist
in connection with its self-insurance programs;
(r) Liens on the Property of the HUD Financing Subsidiaries securing
the HUD Financing; and
(s) Liens on the Property (other than accounts receivable) of Aeries
Healthcare of Illinois, Inc. securing the HUD Financing.
8.02 INVESTMENTS.
Make any Investments, except:
(a) cash or Cash Equivalents;
(b) accounts receivable and promissory notes created, acquired or
made and trade credit extended in the ordinary course of business and
payable or dischargeable in accordance with customary trade terms;
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(c) Investments consisting of stock, obligations, securities or
other property received in settlement of accounts receivable (created in
the ordinary course of business) from financially troubled obligors
(d) Investments existing as of the Closing Date and set forth in
Schedule 8.02;
(e) Guarantees permitted by Section 8.03;
(f) Permitted Acquisitions;
(g) loans and advances to employees, directors and officers in the
ordinary course of business in the aggregate not to exceed $750,000 in the
aggregate at any time outstanding;
(h) Investments made prior to the Closing Date in any Subsidiary;
(i) Investments by any Foreign Subsidiary in another Foreign
Subsidiary;
(j) Investments in any Person that is a Loan Party prior to giving
effect to such Investment;
(k) Investments in any Immaterial Subsidiary;
(l) Investments in PSI Surety to pay its reasonable general
corporate and overhead expenses and to cause PSI Surety to maintain the
minimum amount of capital required by applicable Laws, provided that the
aggregate amount of Investments in PSI Surety pursuant to this clause (l)
shall not exceed $2 million in any fiscal year;
(m) Investments consisting of non-cash consideration received in
connection with a Disposition permitted under Section 8.05; and
(n) Investments not permitted in the foregoing clauses in an amount
not to exceed $10,000,000 in the aggregate at any time outstanding.
8.03 INDEBTEDNESS.
Create, incur, assume or suffer to exist any Indebtedness, except:
(a) Indebtedness under the Loan Documents;
(b) Indebtedness of the Borrower and its Subsidiaries set forth in
Schedule 8.03 (and renewals, refinancings and extensions thereof on terms
and conditions not materially less favorable to the applicable debtor(s));
(c) purchase money Indebtedness (including obligations in respect of
Capital Leases or Synthetic Leases) hereafter incurred by the Borrower or
any of its Subsidiaries to finance the purchase of fixed assets, provided
that (i) such Indebtedness when incurred shall not exceed the purchase
price of the asset(s) financed, (ii) no such Indebtedness shall be
refinanced for a principal amount in excess of the principal balance
outstanding thereon at the time of such refinancing and (iii) the total
amount of all such Indebtedness at any time outstanding shall not exceed
$5,000,000;
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(d) obligations (contingent or otherwise) of the Borrower or any
Subsidiary existing or arising under any Swap Contract, provided that (i)
such obligations are (or were) entered into by such Person in the ordinary
course of business for the purpose of directly mitigating risks associated
with liabilities, commitments, investments, assets, or property held or
reasonably anticipated by such Person, or changes in the value of
securities issued by such Person, and not for purposes of speculation or
taking a "market view;" and (ii) such Swap Contract does not contain any
provision exonerating the non-defaulting party from its obligation to make
payments on outstanding transactions to the defaulting party;
(e) intercompany Indebtedness permitted under Section 8.02;
(f) Senior Subordinated Notes;
(g) HUD Financing existing on the Closing Date and renewals,
refinancings and extensions thereof on terms and conditions not materially
less favorable to the applicable debtor(s) (provided that the principal
amount thereof shall not be refinanced for a principal amount in excess of
the principal balance outstanding thereon at the time of such
refinancing);
(h) Earn-Out Obligations in an aggregate amount not to exceed
$25,000,000 at any one time outstanding, provided that such Earn-Out
Obligations are subordinated to the Obligations in a manner and to an
extent acceptable to the Administrative Agent;
(i) other unsecured Indebtedness in an aggregate principal amount
not to exceed $5,000,000 at any one time outstanding; and
(j) Guarantees with respect to Indebtedness permitted under this
Section 8.03.
8.04 FUNDAMENTAL CHANGES.
Merge, dissolve, liquidate, consolidate with or into another Person, or
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
in favor of any Person; provided that, notwithstanding the foregoing provisions
of this Section 8.04 but subject to the terms of Sections 7.12 and 7.14, (a) the
Borrower may merge or consolidate with any Subsidiary, provided that the
Borrower shall be the continuing or surviving corporation, (b) any Subsidiary
may merge or consolidate with any other Subsidiary, provided that (i) if a
Guarantor is a party thereto, then a Guarantor shall be the continuing or
surviving corporation and (ii) if a Guarantor is not a party thereto and a
Domestic Subsidiary is a party thereto, then a Domestic Subsidiary shall be the
continuing or surviving corporation, (c) any Subsidiary may merge with any
Person that is not a Loan Party in connection with a Disposition permitted under
Section 8.05, (d) the Borrower or any Subsidiary may merge with any Person that
is not a Loan Party in connection with a Permitted Acquisition provided that, if
such transaction involves the Borrower, the Borrower shall be the continuing or
surviving corporation, and (e) any Wholly Owned Subsidiary may dissolve,
liquidate or wind up its affairs at any time provided that such dissolution,
liquidation or winding up, as applicable, could not have a Material Adverse
Effect.
8.05 DISPOSITIONS.
Make any Disposition unless:
(a) if such transaction is a Sale and Leaseback Transaction, such
transaction is not prohibited by the terms of Section 8.15;
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(b) such transaction does not involve the sale or other disposition
of a minority equity interest in any Subsidiary;
(c) such transaction does not involve a sale or other disposition of
receivables other than receivables owned by or attributable to other
Property concurrently being disposed of in a transaction otherwise
permitted under this Section 8.05;
(d) no Default has occurred and is continuing;
(e) the consideration paid in connection therewith shall be cash or
Cash Equivalents received contemporaneous with the consummation of such
Disposition and shall be in an amount not less than the fair market value
of the Property disposed of; and
(f) the aggregate net book value of all of the Property sold or
otherwise disposed of by the Borrower and its Subsidiaries in any fiscal
year shall not exceed an amount equal to ten percent (10%) of the net book
value of plant, property and equipment of the Borrower and its
Subsidiaries on a consolidated basis as of the last day of the immediately
preceding fiscal year.
8.06 RESTRICTED PAYMENTS.
Declare or make, directly or indirectly, any Restricted Payment, or incur
any obligation (contingent or otherwise) to do so, except that:
(a) each Subsidiary may make Restricted Payments to the holders of
its Capital Stock;
(b) the Borrower and each Subsidiary may declare and make dividend
payments or other distributions payable solely in the Capital Stock of the
Person making such dividend or distribution;
(c) the Borrower may repurchase the Capital Stock of the Borrower
held by departing employees, former employees, directors and former
directors of the Borrower or any of its Subsidiaries in an amount not to
exceed $750,000 in the aggregate during any fiscal year of the Borrower;
and
(d) the Borrower may repurchase all warrants to purchase Capital
Stock of the Borrower held by CapitalSource Finance LLC (or any of its
Affiliates) on the Closing Date.
8.07 CHANGE IN NATURE OF BUSINESS.
Engage in any material line of business substantially different from those
lines of business conducted by the Borrower and its Subsidiaries on the Closing
Date or any business substantially related or incidental thereto.
8.08 TRANSACTIONS WITH AFFILIATES AND INSIDERS.
Enter into or permit to exist any transaction or series of transactions
with any officer, director or Affiliate of such Person other than (a)
transactions between Loan Parties, (b) intercompany transactions expressly
permitted by Section 7.07, Section 8.02, Section 8.03, Section 8.04, Section
8.05 or Section 8.06, (c) reasonable compensation and reimbursement of expenses
of, and indemnification of, officers and directors, (d) transactions pursuant to
the Stock Purchase Agreement dated as of January 6, 2003 among the
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Borrower and the purchasers identified therein (the "Series A Purchasers") and
the Registration Rights Agreement dated January 6, 2003 among the Borrower and
the Series A Purchasers, in each case otherwise complying with this Agreement
and (e) except as otherwise specifically limited in this Agreement, other
transactions which are entered into in the ordinary course of such Person's
business on terms and conditions substantially as favorable to such Person as
would be obtainable by it in a comparable arms-length transaction with a Person
other than an officer, director or Affiliate.
8.09 BURDENSOME AGREEMENTS.
Enter into or permit to exist any Contractual Obligation that encumbers or
restricts the ability of the Borrower or any Subsidiary (other than any Excluded
Subsidiary) to (a) pay dividends or make any other distributions to any Loan
Party on its Capital Stock or with respect to any other interest or
participation in, or measured by, its profits, (b) pay any Indebtedness or other
obligation owed to any Loan Party, (c) make loans or advances to any Loan Party,
(d) sell, lease or transfer any of its Property to any Loan Party, (e) grant any
Lien on any of its Property to secure the Obligations pursuant to the Loan
Documents or any renewals, refinancings, exchanges, refundings or extension
thereof or (f) act as a Loan Party pursuant to the Loan Documents or any
renewals, refinancings, exchanges, refundings or extension thereof, except (in
respect of any of the matters referred to in clauses (a) through (e) above) for
(i) this Agreement and the other Loan Documents, (ii) any document or instrument
governing Indebtedness incurred pursuant to Section 8.03(c), provided that any
such restriction contained therein relates only to the asset or assets
constructed or acquired in connection therewith, (iii) any Permitted Lien or any
document or instrument governing any Permitted Lien, provided that any such
restriction contained therein relates only to the asset or assets subject to
such Permitted Lien, (iv) customary restrictions and conditions contained in any
agreement relating to the sale of any Property permitted under Section 8.05
pending the consummation of such sale, (v) any document or instrument governing
Subordinated Indebtedness and (vi) in the case of the matters referred to in
clause (a) through (d) above, Contractual Obligations of any Person that becomes
a Subsidiary after the Closing Date, provided that such Contractual Obligations
were in existence at the time such Person became a Subsidiary and were not
created in contemplation of or in connection with such Person becoming a
Subsidiary.
8.10 USE OF PROCEEDS.
Use the proceeds of any Credit Extension, whether directly or indirectly,
and whether immediately, incidentally or ultimately, to purchase or carry margin
stock (within the meaning of Regulation U of the FRB) or to extend credit to
others for the purpose of purchasing or carrying margin stock or to refund
indebtedness originally incurred for such purpose.
8.11 FINANCIAL COVENANTS.
(a) Consolidated Total Leverage Ratio. Permit the Consolidated Total
Leverage Ratio as of the end of any fiscal quarter of the Borrower to be greater
than 4.5:1.0.
(b) Consolidated Senior Leverage Ratio. Permit the Consolidated Senior
Leverage Ratio as of the end of any fiscal quarter of the Borrower to be greater
than 2.5:1.0.
(c) Consolidated Fixed Charges Coverage Ratio. Permit the Consolidated
Fixed Charges Coverage Ratio as of the end of any fiscal quarter of the Borrower
to be less than 1.50:1.0.
(d) Consolidated Net Worth. Permit Consolidated Net Worth at any time to
be less than the sum of an amount equal to (i) $107 million, increased on a
cumulative basis as of the end of each fiscal quarter of the Borrower,
commencing with the fiscal quarter ending December 31, 2004 by an amount equal
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to 75% of Consolidated Net Income (to the extent positive) for the fiscal
quarter then ended plus (ii) 100% of the proceeds of all equity issuances after
the Closing Date.
(e) Consolidated Growth Capital Expenditures. Permit Consolidated Growth
Capital Expenditures in an aggregate amount in any fiscal year in excess of
twenty percent (20%) of the net book value of Fixed Assets as of the end of the
immediately preceding fiscal year.
8.12 PREPAYMENT OF OTHER INDEBTEDNESS, ETC.
(a) Amend or modify any of the terms of any Subordinated Indebtedness of
the Borrower or any Subsidiary if such amendment or modification would add or
change any terms in a manner adverse to the Borrower or any Subsidiary
(including any amendment or modification that would shorten the final maturity
or average life to maturity or require any payment to be made sooner than
originally scheduled or increase the interest rate applicable thereto).
(b) Amend or modify any of the subordination provisions of any
Subordinated Indebtedness.
(c) Make (or give any notice with respect thereto) any principal payment
(including any prepayment, whether optional or mandatory) on, or redeem, acquire
for value (including without limitation, by way of depositing money or
securities with the trustee with respect thereto before due for the purpose of
paying when due), refund, refinance or exchange, any Subordinated Indebtedness,
other than the prepayment of up to 35% of the aggregate principal amount of the
Senior Subordinated Notes with the net cash proceeds of the 2004 Equity Offering
on or before the date ninety (90) days after the closing of the 2004 Equity
Offering.
8.13 ORGANIZATION DOCUMENTS; FISCAL YEAR; LEGAL NAME, STATE OF FORMATION AND
FORM OF ENTITY.
(a) Amend, modify or change its Organization Documents in a manner adverse
to the Lenders.
(b) Change its fiscal year.
(c) Without providing twenty (20) days prior written notice to the
Administrative Agent, change its name, state of formation or form of
organization.
8.14 OWNERSHIP OF SUBSIDIARIES.
Notwithstanding any other provisions of this Agreement to the contrary,
(i) permit any Person (other than the Borrower or any Wholly Owned Subsidiary)
to own any Capital Stock of any Subsidiary, except to qualify directors where
required by applicable law or to satisfy other requirements of applicable law
with respect to the ownership of Capital Stock of Foreign Subsidiaries, (ii)
permit any Subsidiary to issue or have outstanding any shares of preferred
Capital Stock or (iii) create, incur, assume or suffer to exist any Lien on any
Capital Stock of any Subsidiary, except for Permitted Liens.
8.15 SALE AND LEASEBACK TRANSACTIONS.
Enter into any Sale and Leaseback Transaction.
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ARTICLE IX
EVENTS OF DEFAULT AND REMEDIES
9.01 EVENTS OF DEFAULT.
Any of the following shall constitute an Event of Default:
(a) Non-Payment. The Borrower or any other Loan Party fails to pay
(i) when and as required to be paid herein, any amount of principal of any
Loan or any L/C Obligation, or (ii) within three days after the same
becomes due, any interest on any Loan or on any L/C Obligation, or any
commitment fee, utilization fee or other fee due hereunder, or (iii)
within five days after the same becomes due, any other amount payable
hereunder or under any other Loan Document; or
(b) Specific Covenants.
(i) Any Loan Party fails to perform or observe any term,
covenant or agreement contained in any of Section 7.01, 7.02 or 7.03
and such failure continues for five Business Days; or
(ii) Any Loan Party fails to perform or observe any term,
covenant or agreement contained in any of Section 7.05(a), 7.10,
7.11, 7.12, or Article VIII; or
(c) Other Defaults. Any Loan Party fails to perform or observe any
other covenant or agreement (not specified in subsection (a) or (b) above)
contained in any Loan Document on its part to be performed or observed and
such failure continues for thirty days after the earlier of (i) a
Responsible Person of any Loan Party becoming aware of such failure or
(ii) notice thereof to any Loan Party by the Administrative Agent; or
(d) Representations and Warranties. Any representation, warranty,
certification or statement of fact made or deemed made by or on behalf of
the Borrower or any other Loan Party herein, in any other Loan Document,
or in any document delivered in connection herewith or therewith shall be
incorrect or misleading in any material respect when made or deemed made;
or
(e) Cross-Default. (i) The Borrower or any Subsidiary fails to make
any payment when due (whether by scheduled maturity, required prepayment,
acceleration, demand, or otherwise) in respect of any Indebtedness or
Guarantee (other than Indebtedness hereunder and Indebtedness under Swap
Contracts) having an aggregate principal amount (including undrawn
committed or available amounts and including amounts owing to all
creditors under any combined or syndicated credit arrangement) of more
than the Threshold Amount; (ii) the Borrower or any Subsidiary fails to
observe or perform any other agreement or condition relating to any such
Indebtedness or Guarantee or contained in any instrument or agreement
evidencing, securing or relating thereto, or any other event occurs, the
effect of which default or other event is to cause, or to permit the
holder or holders of such Indebtedness or the beneficiary or beneficiaries
of such Guarantee (or a trustee or agent on behalf of such holder or
holders or beneficiary or beneficiaries) to cause, with the giving of
notice if required, such Indebtedness to be demanded or to become due or
to be repurchased, prepaid, defeased or redeemed (automatically or
otherwise), or an offer to repurchase, prepay, defease or redeem such
Indebtedness to be made, prior to its stated maturity, or such Guarantee
to become payable or cash collateral in respect thereof to be demanded; or
(iii) there occurs under any Swap Contract
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an Early Termination Date (as defined in such Swap Contract) resulting
from (A) any event of default under such Swap Contract as to which the
Borrower or any Subsidiary is the Defaulting Party (as defined in such
Swap Contract) or (B) any Termination Event (as so defined) under such
Swap Contract as to which the Borrower or any Subsidiary is an Affected
Party (as so defined) and, in either event, the Swap Termination Value
owed by the Borrower or such Subsidiary as a result thereof is greater
than the Threshold Amount; or
(f) Insolvency Proceedings, Etc. Any Loan Party or any of its
Subsidiaries institutes or consents to the institution of any proceeding
under any Debtor Relief Law, or makes an assignment for the benefit of
creditors; or applies for or consents to the appointment of any receiver,
trustee, custodian, conservator, liquidator, rehabilitator or similar
officer for it or for all or any material part of its Property; or any
receiver, trustee, custodian, conservator, liquidator, rehabilitator or
similar officer is appointed without the application or consent of such
Person and the appointment continues undischarged or unstayed for sixty
calendar days; or any proceeding under any Debtor Relief Law relating to
any such Person or to all or any material part of its Property is
instituted without the consent of such Person and continues undismissed or
unstayed for sixty calendar days, or an order for relief is entered in any
such proceeding; or
(g) Inability to Pay Debts; Attachment. (i) The Borrower or any
Subsidiary becomes unable or admits in writing its inability or fails
generally to pay its debts as they become due, or (ii) any writ or warrant
of attachment or execution or similar process is issued or levied against
all or any material part of the Property of any such Person and is not
released, vacated or fully bonded within thirty days after its issue or
levy; or
(h) Judgments. There is entered against the Borrower or any
Subsidiary (i) one or more final judgments or orders for the payment of
money in an aggregate amount exceeding the Threshold Amount (to the extent
not covered by independent third-party insurance as to which the insurer
has acknowledged in writing its obligation to cover), or (ii) any one or
more non-monetary final judgments that have, or could reasonably be
expected to have, individually or in the aggregate, a Material Adverse
Effect and, in either case, (A) enforcement proceedings are commenced by
any creditor upon such judgment or order, or (B) there is a period of ten
(10) consecutive days during which a stay of enforcement of such judgment,
by reason of a pending appeal or otherwise, is not in effect; or
(i) ERISA. (i) An ERISA Event occurs with respect to a Pension Plan
or Multiemployer Plan which has resulted or could reasonably be expected
to result in liability of the Borrower under Title IV of ERISA to the
Pension Plan, Multiemployer Plan or the PBGC in an aggregate amount in
excess of the Threshold Amount, or (ii) the Borrower or any ERISA
Affiliate fails to pay when due, after the expiration of any applicable
grace period, any installment payment with respect to its withdrawal
liability under Section 4201 of ERISA under a Multiemployer Plan in an
aggregate amount in excess of the Threshold Amount; or
(j) Invalidity of Loan Documents. Any Loan Document, at any time
after its execution and delivery and for any reason other than as
expressly permitted hereunder or satisfaction in full of all the
Obligations, ceases to be in full force and effect or ceaaes to give the
Administrative Agent, for the benefit of the Lenders, any material part of
the Liens purported to be created thereby; or any Loan Party or any other
Person contests in any manner the validity or enforceability of any Loan
Document; or any Loan Party denies that it has any or further liability or
obligation under any Loan Document, or purports to revoke, terminate or
rescind any Loan Document; or
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(k) Change of Control. There occurs any Change of Control; or
(l) Senior Subordinated Notes. (i) There shall occur an "Event of
Default" (or any comparable term) under, and as defined in, any of the
Senior Subordinated Notes Documents, (ii) any of the Obligations for any
reason shall cease to be "Senior Debt" (or any comparable term) under, and
as defined in, the Senior Subordinated Notes Documents, (iii) any
Indebtedness other than the Obligations shall constitute "Designated
Senior Debt" (or any comparable term) under, and as defined in, the Senior
Subordinated Notes Documents or (iv) the subordination provisions of any
of the Senior Subordinated Notes Documents shall, in whole or in part,
terminate, cease to be effective or cease to be legally valid, binding and
enforceable against any holder of the Senior Subordinated Notes; or
(m) Exclusion Event. There shall occur an Exclusion Event that could
reasonably be expected to result in a Material Adverse Effect.
9.02 REMEDIES UPON EVENT OF DEFAULT.
If any Event of Default occurs and is continuing, the Administrative Agent
shall, at the request of, or may, with the consent of, the Required Lenders,
take any or all of the following actions:
(a) declare the commitment of each Lender to make Loans and any
obligation of the L/C Issuer to make L/C Credit Extensions to be
terminated, whereupon such commitments and obligation shall be terminated;
(b) declare the unpaid principal amount of all outstanding Loans,
all interest accrued and unpaid thereon, and all other amounts owing or
payable hereunder or under any other Loan Document to be immediately due
and payable, without presentment, demand, protest or other notice of any
kind, all of which are hereby expressly waived by the Borrower;
(c) require that the Borrower Cash Collateralize the L/C Obligations
(in an amount equal to the then Outstanding Amount thereof); and
(d) exercise on behalf of itself and the Lenders all rights and
remedies available to it and the Lenders under the Loan Documents or
applicable law;
provided, however, that upon the occurrence of an actual or deemed entry of an
order for relief with respect to the Borrower under the Bankruptcy Code of the
United States, the obligation of each Lender to make Loans and any obligation of
the L/C Issuer to make L/C Credit Extensions shall automatically terminate, the
unpaid principal amount of all outstanding Loans and all interest and other
amounts as aforesaid shall automatically become due and payable, and the
obligation of the Borrower to Cash Collateralize the L/C Obligations as
aforesaid shall automatically become effective, in each case without further act
of the Administrative Agent or any Lender.
9.03 APPLICATION OF FUNDS.
After the exercise of remedies provided for in Section 9.02 (or after the
Loans have automatically become immediately due and payable and the L/C
Obligations have automatically been required to be Cash Collateralized as set
forth in the proviso to Section 9.02), any amounts received on account of the
Obligations shall be applied by the Administrative Agent in the following order:
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First, to payment of that portion of the Obligations constituting fees,
indemnities, expenses and other amounts (including Attorney Costs and
amounts payable under Article III) payable to the Administrative Agent in
its capacity as such;
Second, to payment of that portion of the Obligations constituting fees,
indemnities and other amounts (other than principal and interest) payable
to the Lenders (including Attorney Costs and amounts payable under Article
III), ratably among them in proportion to the amounts described in this
clause Second payable to them;
Third, to payment of that portion of the Obligations constituting accrued
and unpaid interest on the Loans and L/C Borrowings, fees, premiums and
scheduled periodic payments, and any interest accrued thereon, due under
any Swap Contract between any Loan Party and any Lender, or any Affiliate
of a Lender, to the extent such Swap Contract is permitted by Section
8.03(d), ratably among the Lenders (and, in the case of such Swap
Contracts, Affiliates of Lenders) in proportion to the respective amounts
described in this clause Third held by them;
Fourth, to payment of that portion of the Obligations constituting unpaid
principal of the Loans and L/C Borrowings, breakage, termination or other
payments, and any interest accrued thereon, due under any Swap Contract
between any Loan Party and any Lender, or any Affiliate of a Lender, to
the extent such Swap Contract is permitted by Section 8.03(d), and amounts
due under any Treasury Management Agreement between any Loan Party and any
Lender, or any Affiliate of a Lender, and to Cash Collateralize that
portion of L/C Obligations comprised of the aggregate undrawn amount of
Letters of Credit, ratably among the Lenders (and, in the case of such
Swap Contracts and Treasury Management Agreements, Affiliates of Lenders)
in proportion to the respective amounts described in this clause Fourth
held by them; and
Last, the balance, if any, after all of the Obligations have been
indefeasibly paid in full, to the Borrower or as otherwise required by
Law.
Subject to Section 2.03(c), amounts used to Cash Collateralize the aggregate
undrawn amount of Letters of Credit pursuant to clause Fourth above shall be
applied to satisfy drawings under such Letters of Credit as they occur. If any
amount remains on deposit as Cash Collateral after all Letters of Credit have
either been fully drawn or expired, such remaining amount shall be applied to
the other Obligations, if any, in the order set forth above.
ARTICLE X
ADMINISTRATIVE AGENT
10.01 APPOINTMENT AND AUTHORIZATION OF ADMINISTRATIVE AGENT.
(a) Each Lender hereby irrevocably appoints, designates and authorizes the
Administrative Agent to take such action on its behalf under the provisions of
this Agreement and each other Loan Document and to exercise such powers and
perform such duties as are expressly delegated to it by the terms of this
Agreement or any other Loan Document, together with such powers as are
reasonably incidental thereto. Notwithstanding any provision to the contrary
contained elsewhere herein or in any other Loan Document, the Administrative
Agent shall not have any duties or responsibilities, except those expressly set
forth herein, nor shall the Administrative Agent have or be deemed to have any
fiduciary relationship with any Lender or participant, and no implied covenants,
functions, responsibilities, duties, obligations or liabilities shall be read
into this Agreement or any other Loan Document or otherwise exist
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against the Administrative Agent. Without limiting the generality of the
foregoing sentence, the use of the term "agent" herein and in the other Loan
Documents with reference to the Administrative Agent is not intended to connote
any fiduciary or other implied (or express) obligations arising under agency
doctrine of any applicable Law. Instead, such term is used merely as a matter of
market custom, and is intended to create or reflect only an administrative
relationship between independent contracting parties.
(b) The L/C Issuer shall act on behalf of the Lenders with respect to any
Letters of Credit issued by it and the documents associated therewith, and the
L/C Issuer shall have all of the benefits and immunities (i) provided to the
Administrative Agent in this Article X with respect to any acts taken or
omissions suffered by the L/C Issuer in connection with Letters of Credit issued
by it or proposed to be issued by it and the applications and agreements for
letters of credit pertaining to such Letters of Credit as fully as if the term
"Administrative Agent" as used in this Article X and in the definition of
"Agent-Related Person" included the L/C Issuer with respect to such acts or
omissions, and (ii) as additionally provided herein with respect to the L/C
Issuer.
10.02 DELEGATION OF DUTIES.
The Administrative Agent may execute any of its duties under this
Agreement or any other Loan Document by or through agents, employees or
attorneys-in-fact and shall be entitled to advice of counsel and other
consultants or experts concerning all matters pertaining to such duties. The
Administrative Agent shall not be responsible for the negligence or misconduct
of any agent or attorney-in-fact that it selects in the absence of gross
negligence or willful misconduct.
10.03 LIABILITY OF ADMINISTRATIVE AGENT.
No Agent-Related Person shall (a) be liable for any action taken or
omitted to be taken by any of them under or in connection with this Agreement or
any other Loan Document or the transactions contemplated hereby (except for its
own gross negligence or willful misconduct in connection with its duties
expressly set forth herein), or (b) be responsible in any manner to any Lender
or participant for any recital, statement, representation or warranty made by
any Loan Party or any officer thereof, contained herein or in any other Loan
Document, or in any certificate, report, statement or other document referred to
or provided for in, or received by the Administrative Agent under or in
connection with, this Agreement or any other Loan Document, or the validity,
effectiveness, genuineness, enforceability or sufficiency of this Agreement or
any other Loan Document, or for any failure of any Loan Party or any other party
to any Loan Document to perform its obligations hereunder or thereunder. No
Agent-Related Person shall be under any obligation to any Lender or participant
to ascertain or to inquire as to the observance or performance of any of the
agreements contained in, or conditions of, this Agreement or any other Loan
Document, or to inspect the properties, books or records of any Loan Party or
any Affiliate thereof.
10.04 RELIANCE BY ADMINISTRATIVE AGENT.
(a) The Administrative Agent shall be entitled to rely, and shall be fully
protected in relying, upon any writing, communication, signature, resolution,
representation, notice, consent, certificate, affidavit, letter, telegram,
facsimile, telex or telephone message, electronic mail message, statement or
other document or conversation believed by it to be genuine and correct and to
have been signed, sent or made by the proper Person or Persons, and upon advice
and statements of legal counsel (including counsel to any Loan Party),
independent accountants and other experts selected by the Administrative Agent.
The Administrative Agent shall be fully justified in failing or refusing to take
any action under any Loan Document unless it shall first receive such advice or
concurrence of the Required Lenders as it deems appropriate and, if it so
requests, it shall first be indemnified to its satisfaction by the Lenders
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against any and all liability and expense which may be incurred by it by reason
of taking or continuing to take any such action. The Administrative Agent shall
in all cases be fully protected in acting, or in refraining from acting, under
this Agreement or any other Loan Document in accordance with a request or
consent of the Required Lenders (or such greater number of Lenders as may be
expressly required hereby in any instance) and such request and any action taken
or failure to act pursuant thereto shall be binding upon all the Lenders.
(b) For purposes of determining compliance with the conditions specified
in Section 5.01, each Lender that has signed this Agreement shall be deemed to
have consented to, approved or accepted or to be satisfied with, each document
or other matter required thereunder to be consented to or approved by or
acceptable or satisfactory to a Lender unless the Administrative Agent shall
have received notice from such Lender prior to the proposed Closing Date
specifying its objection thereto.
10.05 NOTICE OF DEFAULT.
The Administrative Agent shall not be deemed to have knowledge or notice
of the occurrence of any Default, except with respect to defaults in the payment
of principal, interest and fees required to be paid to the Administrative Agent
for the account of the Lenders, unless the Administrative Agent shall have
received written notice from a Lender or the Borrower referring to this
Agreement, describing such Default and stating that such notice is a "notice of
default." The Administrative Agent will notify the Lenders of its receipt of any
such notice. The Administrative Agent shall take such action with respect to
such Default as may be directed by the Required Lenders in accordance with
Article IX; provided, however, that unless and until the Administrative Agent
has received any such direction, the Administrative Agent may (but shall not be
obligated to) take such action, or refrain from taking such action, with respect
to such Default as it shall deem advisable or in the best interest of the
Lenders.
10.06 CREDIT DECISION; DISCLOSURE OF INFORMATION BY ADMINISTRATIVE AGENT.
Each Lender acknowledges that no Agent-Related Person has made any
representation or warranty to it, and that no act by the Administrative Agent
hereafter taken, including any consent to and acceptance of any assignment or
review of the affairs of any Loan Party or any Affiliate thereof, shall be
deemed to constitute any representation or warranty by any Agent-Related Person
to any Lender as to any matter, including whether Agent-Related Persons have
disclosed material information in their possession. Each Lender represents to
the Administrative Agent that it has, independently and without reliance upon
any Agent-Related Person and based on such documents and information as it has
deemed appropriate, made its own appraisal of and investigation into the
business, prospects, operations, property, financial and other condition and
creditworthiness of the Loan Parties and their respective Subsidiaries, and all
applicable bank or other regulatory Laws relating to the transactions
contemplated hereby, and made its own decision to enter into this Agreement and
to extend credit to the Borrower and the other Loan Parties hereunder. Each
Lender also represents that it will, independently and without reliance upon any
Agent-Related Person and based on such documents and information as it shall
deem appropriate at the time, continue to make its own credit analysis,
appraisals and decisions in taking or not taking action under this Agreement and
the other Loan Documents, and to make such investigations as it deems necessary
to inform itself as to the business, prospects, operations, property, financial
and other condition and creditworthiness of the Borrower and the other Loan
Parties. Except for notices, reports and other documents expressly required to
be furnished to the Lenders by the Administrative Agent herein, the
Administrative Agent shall not have any duty or responsibility to provide any
Lender with any credit or other information concerning the business, prospects,
operations, property, financial and other condition or creditworthiness of any
of the Loan Parties or any of their respective Affiliates which may come into
the possession of any Agent-Related Person.
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10.07 INDEMNIFICATION OF ADMINISTRATIVE AGENT.
Whether or not the transactions contemplated hereby are consummated, the
Lenders shall indemnify upon demand each Agent-Related Person (to the extent not
reimbursed by or on behalf of any Loan Party and without limiting the obligation
of any Loan Party to do so), pro rata, and hold harmless each Agent-Related
Person from and against any and all Indemnified Liabilities incurred by it;
provided, however, that no Lender shall be liable for the payment to any
Agent-Related Person of any portion of such Indemnified Liabilities to the
extent determined in a final, nonappealable judgment by a court of competent
jurisdiction to have resulted from such Agent-Related Person's own gross
negligence or willful misconduct; provided, however, that no action taken in
accordance with the directions of the Required Lenders shall be deemed to
constitute gross negligence or willful misconduct for purposes of this Section.
Without limitation of the foregoing, each Lender shall reimburse the
Administrative Agent upon demand for its ratable share of any costs or
out-of-pocket expenses (including Attorney Costs) incurred by the Administrative
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, any other Loan Document, or any document
contemplated by or referred to herein, to the extent that the Administrative
Agent is not reimbursed for such expenses by or on behalf of the Borrower. The
undertaking in this Section shall survive termination of the Aggregate Revolving
Commitments, the payment of all Obligations and the resignation of the
Administrative Agent.
10.08 ADMINISTRATIVE AGENT IN ITS INDIVIDUAL CAPACITY.
Bank of America and its Affiliates may make loans to, issue letters of
credit for the account of, accept deposits from, acquire equity interests in and
generally engage in any kind of banking, trust, financial advisory, underwriting
or other business with each of the Loan Parties and their respective Affiliates
as though Bank of America were not the Administrative Agent or the L/C Issuer
hereunder and without notice to or consent of the Lenders. The Lenders
acknowledge that, pursuant to such activities, Bank of America or its Affiliates
may receive information regarding any Loan Party or its Affiliates (including
information that may be subject to confidentiality obligations in favor of such
Loan Party or such Affiliate) and acknowledge that the Administrative Agent
shall be under no obligation to provide such information to them. With respect
to its Loans, Bank of America shall have the same rights and powers under this
Agreement as any other Lender and may exercise such rights and powers as though
it were not the Administrative Agent or the L/C Issuer, and the terms "Lender"
and "Lenders" include Bank of America in its individual capacity.
10.09 USUCCESSOR ADMINISTRATIVE AGENT.
The Administrative Agent may resign as Administrative Agent upon thirty
days' notice to the Lenders; provided that any such resignation by Bank of
America shall also constitute its resignation as L/C Issuer and Swing Line
Lender. If the Administrative Agent resigns under this Agreement, the Required
Lenders shall appoint from among the Lenders a successor administrative agent
for the Lenders, which successor administrative agent shall be consented to by
the Borrower at all times other than during the existence of an Event of Default
(which consent of the Borrower shall not be unreasonably withheld or delayed).
If no successor administrative agent is appointed prior to the effective date of
the resignation of the Administrative Agent, the Administrative Agent may
appoint, after consulting with the Lenders and the Borrower, a successor
administrative agent from among the Lenders. Upon the acceptance of its
appointment as successor administrative agent hereunder, the Person acting as
such successor administrative agent shall succeed to all the rights, powers and
duties of the retiring Administrative Agent, L/C Issuer and Swing Line Lender
and the respective terms "Administrative Agent", "L/C Issuer" and "Swing Line
Lender" shall mean such successor administrative agent, Letter of Credit issuer
and
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swing line lender, and the retiring Administrative Agent's appointment, powers
and duties as Administrative Agent shall be terminated and the retiring L/C
Issuer's and Swing Line Lender's rights, powers and duties as such shall be
terminated, without any other or further act or deed on the part of such
retiring L/C Issuer or Swing Line Lender or any other Lender, other than the
obligation of the successor L/C Issuer to issue letters of credit in
substitution for the Letters of Credit, if any, outstanding at the time of such
succession or to make other arrangements satisfactory to the retiring L/C Issuer
to effectively assume the obligations of the retiring L/C Issuer with respect to
such Letters of Credit. After any retiring Administrative Agent's resignation
hereunder as Administrative Agent, the provisions of this Article X and Sections
11.04 and 11.05 shall inure to its benefit as to any actions taken or omitted to
be taken by it while it was Administrative Agent under this Agreement. If no
successor administrative agent has accepted appointment as Administrative Agent
by the date thirty days following a retiring Administrative Agent's notice of
resignation, the retiring Administrative Agent's resignation shall nevertheless
thereupon become effective and the Lenders shall perform all of the duties of
the Administrative Agent hereunder until such time, if any, as the Required
Lenders appoint a successor agent as provided for above.
10.10 ADMINISTRATIVE AGENT MAY FILE PROOFS OF CLAIM.
In case of the pendency of any receivership, insolvency, liquidation,
bankruptcy, reorganization, arrangement, adjustment, composition or other
judicial proceeding relative to any Loan Party, the Administrative Agent
(irrespective of whether the principal of any Loan or L/C Obligation shall then
be due and payable as herein expressed or by declaration or otherwise and
irrespective of whether the Administrative Agent shall have made any demand on
the Borrower) shall be entitled and empowered, by intervention in such
proceeding or otherwise:
(a) to file and prove a claim for the whole amount of the principal
and interest owing and unpaid in respect of the Loans, L/C Obligations and
all other Obligations that are owing and unpaid and to file such other
documents as may be necessary or advisable in order to have the claims of
the Lenders and the Administrative Agent (including any claim for the
reasonable compensation, expenses, disbursements and advances of the
Lenders and the Administrative Agent and their respective agents and
counsel and all other amounts due the Lenders and the Administrative Agent
under Sections 2.03(i) and (j), 2.09 and 11.04) allowed in such judicial
proceeding; and
(b) to collect and receive any monies or other property payable or
deliverable on any such claims and to distribute the same;
and any custodian, receiver, assignee, trustee, liquidator, sequestrator or
other similar official in any such judicial proceeding is hereby authorized by
each Lender to make such payments to the Administrative Agent and, in the event
that the Administrative Agent shall consent to the making of such payments
directly to the Lenders, to pay to the Administrative Agent any amount due for
the reasonable compensation, expenses, disbursements and advances of the
Administrative Agent and its agents and counsel, and any other amounts due the
Administrative Agent under Sections 2.09 and 11.04.
Nothing contained herein shall be deemed to authorize the Administrative
Agent to authorize or consent to or accept or adopt on behalf of any Lender any
plan of reorganization, arrangement, adjustment or composition affecting the
Obligations or the rights of any Lender or to authorize the Administrative Agent
to vote in respect of the claim of any Lender in any such proceeding.
10.11 COLLATERAL AND GUARANTY MATTERS.
The Lenders irrevocably authorize the Administrative Agent, at its option
and in its discretion,
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(a) to release any Lien on any Collateral granted to or held by the
Administrative Agent under any Loan Document (i) upon termination of the
Aggregate Revolving Commitments and payment in full of all Obligations
(other than contingent indemnification obligations) and the expiration or
termination of all Letters of Credit, (ii) that is transferred or to be
transferred as part of or in connection with any Disposition permitted
hereunder or under any other Loan Document or any Involuntary Disposition,
or (iii) as approved in accordance with Section 11.01; and
(b) to release any Guarantor from its obligations under the Guaranty
if such Person ceases to be a Subsidiary as a result of a transaction
permitted hereunder.
Upon request by the Administrative Agent at any time, the Required Lenders
will confirm in writing the Administrative Agent's authority to release or
subordinate its interest in particular types or items of Property, or to
release any Guarantor from its obligations under the Guaranty, pursuant to
this Section 10.11.
10.12 OTHER AGENTS; ARRANGERS AND MANAGERS.
None of the Lenders or other Persons identified on the facing page or
signature pages of this Agreement as a "syndication agent," "documentation
agent," "co-agent," "book manager," "lead manager," "arranger," "lead arranger"
or "co-arranger" shall have any right, power, obligation, liability,
responsibility or duty under this Agreement other than, in the case of such
Lenders, those applicable to all Lenders as such. Without limiting the
foregoing, none of the Lenders or other Persons so identified shall have or be
deemed to have any fiduciary relationship with any Lender. Each Lender
acknowledges that it has not relied, and will not rely, on any of the Lenders or
other Persons so identified in deciding to enter into this Agreement or in
taking or not taking action hereunder.
ARTICLE XI
MISCELLANEOUS
11.01 AMENDMENTS, ETC.
No amendment or waiver of any provision of this Agreement or any other
Loan Document, and no consent to any departure by the Borrower or any other Loan
Party therefrom, shall be effective unless in writing signed by the Required
Lenders and the Borrower or the applicable Loan Party, as the case may be, and
acknowledged by the Administrative Agent, and each such waiver or consent shall
be effective only in the specific instance and for the specific purpose for
which given; provided, however, that no such amendment, waiver or consent shall:
(a) extend or increase the Revolving Commitment of any Lender (or
reinstate any Revolving Commitment terminated pursuant to Section 9.02)
without the written consent of such Lender (it being understood and agreed
that a waiver of any condition precedent set forth in Section 5.02 or of
any Default or Event of Default or a mandatory reduction in Revolving
Commitments is not considered an extension or increase in Revolving
Commitments of any Lender);
(b) postpone any date fixed by this Agreement or any other Loan
Document for any payment of principal (excluding mandatory prepayments),
interest, fees or other amounts due to the Lenders (or any of them)
hereunder or under any other Loan Document without the written consent of
each Lender directly affected thereby;
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(c) reduce the principal of, or the rate of interest specified
herein on, any Loan or L/C Borrowing, or any fees or other amounts payable
hereunder or under any other Loan Document without the written consent of
each Lender directly affected thereby; provided, however, that only the
consent of the Required Lenders shall be necessary to amend the definition
of "Default Rate" or to waive any obligation of the Borrower to pay
interest at the Default Rate;
(d) change Section 2.13 or Section 9.03 in a manner that would alter
the pro rata sharing of payments required thereby without the written
consent of each Lender directly affected thereby;
(e) change any provision of this Section or the definition of
"Required Lenders" or any other provision hereof specifying the number or
percentage of Lenders required to amend, waive or otherwise modify any
rights hereunder or make any determination or grant any consent hereunder
without the written consent of each Lender directly affected thereby;
(f) except in connection with a Disposition permitted under Section
8.05, release all or substantially all of the Collateral without the
written consent of each Lender directly affected thereby; or
(g) release the Borrower or, except in connection with a merger or
consolidation permitted under Section 8.04 or a Disposition permitted
under Section 8.05, all or substantially all of the Guarantors, from its
or their obligations under the Loan Documents without the written consent
of each Lender directly affected thereby;
and, provided further, that (i) no amendment, waiver or consent shall, unless in
writing and signed by the L/C Issuer in addition to the Lenders required above,
affect the rights or duties of the L/C Issuer under this Agreement or any Letter
of Credit Application relating to any Letter of Credit issued or to be issued by
it; (ii) no amendment, waiver or consent shall, unless in writing and signed by
the Swing Line Lender in addition to the Lenders required above, affect the
rights or duties of the Swing Line Lender under this Agreement; (iii) no
amendment, waiver or consent shall, unless in writing and signed by the
Administrative Agent in addition to the Lenders required above, affect the
rights or duties of the Administrative Agent under this Agreement or any other
Loan Document; and (iv) the Fee Letter may be amended, or rights or privileges
thereunder waived, in a writing executed only by the parties thereto.
Notwithstanding anything to the contrary herein, no Defaulting Lender shall have
any right to approve or disapprove any amendment, waiver or consent hereunder,
except that the Revolving Commitment of such Lender may not be increased or
extended without the consent of such Lender.
Notwithstanding the fact that the consent of all the Lenders is required in
certain circumstances as set forth above, (x) each Lender is entitled to vote as
such Lender sees fit on any bankruptcy reorganization plan that affects the
Loans, and each Lender acknowledges that the provisions of Section 1126(c) of
the Bankruptcy Code supersedes the unanimous consent provisions set forth herein
and (y) the Required Lenders shall determine whether or not to allow a Loan
Party to use cash collateral in the context of a bankruptcy or insolvency
proceeding and such determination shall be binding on all of the Lenders.
11.02 NOTICES AND OTHER COMMUNICATIONS; FACSIMILE COPIES.
(a) General. Unless otherwise expressly provided herein, all notices and
other communications provided for hereunder shall be in writing (including by
facsimile transmission). All such written notices shall be mailed, faxed or
delivered to the applicable address, facsimile number or (subject to subsection
(c) below) electronic mail address, and all notices and other communications
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expressly permitted hereunder to be given by telephone shall be made to the
applicable telephone number, as follows:
(i) if to the Borrower, the Administrative Agent, the L/C Issuer or
the Swing Line Lender, to the address, facsimile number, electronic mail
address or telephone number specified for such Person on Schedule 11.02 or
to such other address, facsimile number, electronic mail address or
telephone number as shall be designated by such party in a notice to the
other parties; and
(ii) if to any other Lender, to the address, facsimile number,
electronic mail address or telephone number specified in its
Administrative Questionnaire or to such other address, facsimile number,
electronic mail address or telephone number as shall be designated by such
party in a notice to the Borrower, the Administrative Agent, the L/C
Issuer and the Swing Line Lender.
All such notices and other communications shall be deemed to be given or
made upon the earlier to occur of (i) actual receipt by the relevant party
hereto and (ii) (A) if delivered by hand or by courier, when signed for by or on
behalf of the relevant party hereto; (B) if delivered by mail, four Business
Days after deposit in the mails, postage prepaid; (C) if delivered by facsimile,
when sent and receipt has been confirmed by telephone; and (D) if delivered by
electronic mail (which form of delivery is subject to the provisions of
subsection (c) below), when delivered; provided, however, that notices and other
communications to the Administrative Agent, the L/C Issuer and the Swing Line
Lender pursuant to Article II shall not be effective until actually received by
such Person. In no event shall a voicemail message be effective as a notice,
communication or confirmation hereunder.
(b) Effectiveness of Facsimile Documents and Signatures. Loan Documents
may be transmitted and/or signed by facsimile. The effectiveness of any such
documents and signatures shall, subject to applicable Law, have the same force
and effect as manually signed originals and shall be binding on all Loan
Parties, the Administrative Agent and the Lenders. The Administrative Agent may
also require that any such documents and signatures be confirmed by a manually
signed original thereof; provided, however, that the failure to request or
deliver the same shall not limit the effectiveness of any facsimile document or
signature.
(c) Limited Use of Electronic Mail. Electronic mail and internet and
intranet websites may be used only to distribute routine communications, such as
financial statements and other information as provided in Section 7.02, and to
distribute Loan Documents for execution by the parties thereto, and may not be
used for any other purpose.
(d) Reliance by Administrative Agent and Lenders. The Administrative Agent
and the Lenders shall be entitled to rely and act upon any notices (including
telephonic Loan Notices and Swing Line Loan Notices) purportedly given by or on
behalf of the Borrower even if (i) such notices were not made in a manner
specified herein, were incomplete or were not preceded or followed by any other
form of notice specified herein, or (ii) the terms thereof, as understood by the
recipient, varied from any confirmation thereof. The Borrower shall indemnify
each Agent-Related Person and each Lender from all losses, costs, expenses and
liabilities resulting from the reliance by such Person on each notice
purportedly given by or on behalf of the Borrower. All telephonic notices to and
other communications with the Administrative Agent may be recorded by the
Administrative Agent, and each of the parties hereto hereby consents to such
recording.
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11.03 NO WAIVER; CUMULATIVE REMEDIES.
No failure by any Lender or the Administrative Agent to exercise, and no
delay by any such Person in exercising, any right, remedy, power or privilege
hereunder shall operate as a waiver thereof; nor shall any single or partial
exercise of any right, remedy, power or privilege hereunder preclude any other
or further exercise thereof or the exercise of any other right, remedy, power or
privilege. The rights, remedies, powers and privileges herein provided are
cumulative and not exclusive of any rights, remedies, powers and privileges
provided by law.
11.04 ATTORNEY COSTS, EXPENSES AND TAXES.
The Borrower agrees (a) to pay or reimburse the Administrative Agent for
all costs and expenses incurred in connection with the development, preparation,
negotiation and execution of this Agreement and the other Loan Documents and any
amendment, waiver, consent or other modification of the provisions hereof and
thereof (whether or not the transactions contemplated hereby or thereby are
consummated), and the consummation and administration of the transactions
contemplated hereby and thereby, including all Attorney Costs and costs and
expenses in connection with the use of Intralinks, Inc. or other similar
information transmission systems in connection with this Agreement, and (b) to
pay or reimburse the Administrative Agent and each Lender for all costs and
expenses incurred in connection with the enforcement, attempted enforcement, or
preservation of any rights or remedies under this Agreement or the other Loan
Documents (including all such costs and expenses incurred during any "workout"
or restructuring in respect of the Obligations and during any legal proceeding,
including any proceeding under any Debtor Relief Law), including all Attorney
Costs. The foregoing costs and expenses shall include all search, filing,
recording, title insurance and appraisal charges and fees and taxes related
thereto, and other out-of-pocket expenses incurred by the Administrative Agent
and the cost of independent public accountants and other outside experts
retained by the Administrative Agent or any Lender. All amounts due under this
Section 11.04 shall be payable within ten Business Days after demand therefor.
The agreements in this Section shall survive the termination of the Aggregate
Revolving Commitments and repayment of all Obligations.
11.05 INDEMNIFICATION BY THE BORROWER.
Whether or not the transactions contemplated hereby are consummated, the
Borrower agrees to indemnify and hold harmless each Agent-Related Person, each
Lender and their respective Affiliates, directors, officers, employees, counsel,
trustees, advisors, agents and attorneys-in-fact (collectively the
"Indemnitees") from and against any and all liabilities, obligations, losses,
damages, penalties, claims, demands, actions, judgments, suits, costs, expenses
and disbursements (including Attorney Costs) of any kind or nature whatsoever
which may at any time be imposed on, incurred by or asserted against any such
Indemnitee in any way relating to or arising out of or in connection with (a)
the execution, delivery, enforcement, performance or administration of any Loan
Document or any other agreement, letter or instrument delivered in connection
with the transactions contemplated thereby or the consummation of the
transactions contemplated thereby, (b) any Revolving Commitment, Loan or Letter
of Credit or the use or proposed use of the proceeds therefrom (including any
refusal by the L/C Issuer to honor a demand for payment under a Letter of Credit
if the documents presented in connection with such demand do not strictly comply
with the terms of such Letter of Credit), (c) any actual or alleged presence or
release of Hazardous Materials on or from any property currently or formerly
owned or operated by the Borrower, any Subsidiary or any other Loan Party, or
any Environmental Liability related in any way to the Borrower, any Subsidiary
or any other Loan Party, or (d) any actual or prospective claim, litigation,
investigation or proceeding relating to any of the foregoing, whether based on
contract, tort or any other theory (including any investigation of, preparation
for, or defense of any pending or threatened claim, investigation, litigation or
proceeding) and regardless of whether any Indemnitee is a party thereto (all the
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foregoing, collectively, the "Indemnified Liabilities"); provided that such
indemnity shall not, as to any Indemnitee, be available to the extent that such
liabilities, obligations, losses, damages, penalties, claims, demands, actions,
judgments, suits, costs, expenses or disbursements are determined by a court of
competent jurisdiction by final and nonappealable judgment to have resulted from
the gross negligence or willful misconduct of such Indemnitee. No Indemnitee
shall be liable for any damages arising from the use by others of any
information or other materials obtained through IntraLinks or other similar
information transmission systems in connection with this Agreement, nor shall
any Indemnitee have any liability for any indirect or consequential damages
relating to this Agreement or any other Loan Document or arising out of its
activities in connection herewith or therewith (whether before or after the
Closing Date). All amounts due under this Section 11.05 shall be payable within
ten Business Days after demand therefor. The agreements in this Section shall
survive the resignation of the Administrative Agent, the replacement of any
Lender, the termination of the Aggregate Revolving Commitments and the
repayment, satisfaction or discharge of all the Obligations.
11.06 PAYMENTS SET ASIDE.
To the extent that any payment by or on behalf of any Loan Party is made
to the Administrative Agent or any Lender, or the Administrative Agent or any
Lender exercises its right of set-off, and such payment or the proceeds of such
set-off or any part thereof is subsequently invalidated, declared to be
fraudulent or preferential, set aside or required (including pursuant to any
settlement entered into by the Administrative Agent or such Lender in its
discretion) to be repaid to a trustee, receiver or any other party, in
connection with any proceeding under any Debtor Relief Law or otherwise, then
(a) to the extent of such recovery, the obligation or part thereof originally
intended to be satisfied shall be revived and continued in full force and effect
as if such payment had not been made or such set-off had not occurred, and (b)
each Lender severally agrees to pay to the Administrative Agent upon demand its
applicable share of any amount so recovered from or repaid by the Administrative
Agent, plus interest thereon from the date of such demand to the date such
payment is made at a rate per annum equal to the Federal Funds Rate from time to
time in effect.
11.07 SUCCESSORS AND ASSIGNS.
(a) The provisions of this Agreement shall be binding upon and inure to
the benefit of the parties hereto and their respective successors and assigns
permitted hereby, except that the Borrower may not assign or otherwise transfer
any of its rights or obligations hereunder without the prior written consent of
each Lender and no Lender may assign or otherwise transfer any of its rights or
obligations hereunder except (i) to an Eligible Assignee in accordance with the
provisions of subsection (b) of this Section, (ii) by way of participation in
accordance with the provisions of subsection (d) of this Section or (iii) by way
of pledge or assignment of a security interest subject to the restrictions of
subsection (f) of this Section (and any other attempted assignment or transfer
by any party hereto shall be null and void). Nothing in this Agreement,
expressed or implied, shall be construed to confer upon any Person (other than
the parties hereto, their respective successors and assigns permitted hereby,
Participants to the extent provided in subsection (d) of this Section and, to
the extent expressly contemplated hereby, the Indemnitees) any legal or
equitable right, remedy or claim under or by reason of this Agreement.
(b) Any Lender may at any time assign to one or more Eligible Assignees
all or a portion of its rights and obligations under this Agreement (including
all or a portion of its Revolving Commitment and the Loans (including for
purposes of this subsection (b), participations in L/C Obligations and in Swing
Line Loans) at the time owing to it); provided that (i) except in the case of an
assignment of the entire remaining amount of the assigning Lender's Revolving
Commitment and the Loans at the time owing to it or in the case of an assignment
to a Lender or an Affiliate of a Lender or an Approved Fund with respect to a
Lender, the aggregate amount of the Revolving Commitment (which for this purpose
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includes Loans outstanding thereunder) subject to each such assignment,
determined as of the date the Assignment and Assumption with respect to such
assignment is delivered to the Administrative Agent or, if "Trade Date" is
specified in the Assignment and Assumption, as of the Trade Date, shall not be
less than $5,000,000 unless each of the Administrative Agent and, so long as no
Event of Default has occurred and is continuing, the Borrower otherwise consents
(each such consent not to be unreasonably withheld or delayed); (ii) each
partial assignment shall be made as an assignment of a proportionate part of all
the assigning Lender's rights and obligations under this Agreement with respect
to the Loans or the Revolving Commitment assigned, except that this clause (ii)
shall not apply to rights in respect of Swing Line Loans; and (iii) the parties
to each assignment shall execute and deliver to the Administrative Agent an
Assignment and Assumption, together with a processing and recordation fee of
$3,500. Subject to acceptance and recording thereof by the Administrative Agent
pursuant to subsection (c) of this Section, from and after the effective date
specified in each Assignment and Assumption, the Eligible Assignee thereunder
shall be a party to this Agreement and, to the extent of the interest assigned
by such Assignment and Assumption, have the rights and obligations of a Lender
under this Agreement, and the assigning Lender thereunder shall, to the extent
of the interest assigned by such Assignment and Assumption, be released from its
obligations under this Agreement (and, in the case of an Assignment and
Assumption covering all of the assigning Lender's rights and obligations under
this Agreement, such Lender shall cease to be a party hereto but shall continue
to be entitled to the benefits of Sections 3.01, 3.04, 3.05, 11.04 and 11.05
with respect to facts and circumstances occurring prior to the effective date of
such assignment). Upon request, the Borrower (at its expense) shall execute and
deliver a Note to the assignee Lender. Any assignment or transfer by a Lender of
rights or obligations under this Agreement that does not comply with this
subsection shall be treated for purposes of this Agreement as a sale by such
Lender of a participation in such rights and obligations in accordance with
subsection (d) of this Section.
(c) The Administrative Agent, acting solely for this purpose as an agent
of the Borrower, shall maintain at the Administrative Agent's Office a copy of
each Assignment and Assumption delivered to it and a register for the
recordation of the names and addresses of the Lenders, and the Revolving
Commitments of, and principal amounts of the Loans and L/C Obligations owing to,
each Lender pursuant to the terms hereof from time to time (the "Register"). The
entries in the Register shall be conclusive, and the Borrower, the
Administrative Agent and the Lenders may treat each Person whose name is
recorded in the Register pursuant to the terms hereof as a Lender hereunder for
all purposes of this Agreement, notwithstanding notice to the contrary. The
Register shall be available for inspection by the Borrower and any Lender, at
any reasonable time and from time to time upon reasonable prior notice.
(d) Any Lender may at any time, without the consent of, or notice to, the
Borrower or the Administrative Agent, sell participations to any Person (other
than a natural person or the Borrower or any of the Borrower's Affiliates or
Subsidiaries) (each, a "Participant") in all or a portion of such Lender's
rights and/or obligations under this Agreement (including all or a portion of
its Revolving Commitment and/or the Loans (including such Lender's
participations in L/C Obligations and/or Swing Line Loans) owing to it);
provided that (i) such Lender's obligations under this Agreement shall remain
unchanged, (ii) such Lender shall remain solely responsible to the other parties
hereto for the performance of such obligations and (iii) the Borrower, the
Administrative Agent and the other Lenders shall continue to deal solely and
directly with such Lender in connection with such Lender's rights and
obligations under this Agreement. Any agreement or instrument pursuant to which
a Lender sells such a participation shall provide that such Lender shall retain
the sole right to enforce this Agreement and to approve any amendment,
modification or waiver of any provision of this Agreement; provided that such
agreement or instrument may provide that such Lender will not, without the
consent of the Participant, agree to any amendment, waiver or other modification
described in the first proviso to Section 11.01 that directly affects such
Participant. Subject to subsection (e) of this Section, the Borrower agrees that
each Participant shall be entitled to the benefits of Sections 3.01, 3.04 and
3.05 to the same extent as if it were a Lender and had acquired its interest by
assignment pursuant to subsection (b) of this Section. To the
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extent permitted by law, each Participant also shall be entitled to the benefits
of Section 11.09 as though it were a Lender, provided such Participant agrees to
be subject to Section 2.13 as though it were a Lender.
(e) A Participant shall not be entitled to receive any greater payment
under Section 3.01 or 3.04 than the applicable Lender would have been entitled
to receive with respect to the participation sold to such Participant, unless
the sale of the participation to such Participant is made with the Borrower's
prior written consent. A Participant that would be a Foreign Lender if it were a
Lender shall not be entitled to the benefits of Section 3.01 unless the Borrower
is notified of the participation sold to such Participant and such Participant
agrees, for the benefit of the Borrower, to comply with Section 11.15 as though
it were a Lender.
(f) Any Lender may at any time pledge or assign a security interest in all
or any portion of its rights under this Agreement (including under its Note, if
any) to secure obligations of such Lender, including any pledge or assignment to
secure obligations to a Federal Reserve Bank; provided that no such pledge or
assignment shall release such Lender from any of its obligations hereunder or
substitute any such pledgee or assignee for such Lender as a party hereto.
(g) Notwithstanding anything to the contrary contained herein, if at any
time Bank of America assigns all of its Revolving Commitment and Loans pursuant
to subsection (b) above, Bank of America may, (i) upon thirty days' notice to
the Borrower and the Lenders, resign as L/C Issuer and/or (ii) upon thirty days'
notice to the Borrower, resign as Swing Line Lender. In the event of any such
resignation as L/C Issuer or Swing Line Lender, the Borrower shall be entitled
to appoint from among the Lenders a successor L/C Issuer or Swing Line Lender
hereunder; provided, however, that no failure by the Borrower to appoint any
such successor shall affect the resignation of Bank of America as L/C Issuer or
Swing Line Lender, as the case may be. If Bank of America resigns as L/C Issuer,
it shall retain all the rights and obligations of the L/C Issuer hereunder with
respect to all Letters of Credit outstanding as of the effective date of its
resignation as L/C Issuer and all L/C Obligations with respect thereto
(including the right to require the Lenders to make Base Rate Loans or fund risk
participations in Unreimbursed Amounts pursuant to Section 2.03(c)). If Bank of
America resigns as Swing Line Lender, it shall retain all the rights of the
Swing Line Lender provided for hereunder with respect to Swing Line Loans made
by it and outstanding as of the effective date of such resignation, including
the right to require the Lenders to make Base Rate Loans or fund risk
participations in outstanding Swing Line Loans pursuant to Section 2.04(c).
11.08 CONFIDENTIALITY.
Each of the Administrative Agent and the Lenders agrees to maintain the
confidentiality of the Information (as defined below), except that Information
may be disclosed (a) to its and its Affiliates' directors, officers, employees
and agents, including accountants, legal counsel and other advisors (it being
understood that the Persons to whom such disclosure is made will be informed of
the confidential nature of such Information and instructed to keep such
Information confidential); (b) to the extent requested by any regulatory
authority; (c) to the extent required by applicable laws or regulations or by
any subpoena or similar legal process; (d) to any other party to this Agreement;
(e) in connection with the exercise of any remedies hereunder or any suit,
action or proceeding relating to this Agreement or the enforcement of rights
hereunder; (f) subject to an agreement containing provisions substantially the
same as those of this Section, to (i) any Eligible Assignee of or Participant
in, or any prospective Eligible Assignee of or Participant in, any of its rights
or obligations under this Agreement or (ii) any direct or indirect contractual
counterparty or prospective counterparty (or such contractual counterparty's or
prospective counterparty's professional advisor) to any credit derivative
transaction relating to obligations of the Loan Parties; (g) with the consent of
the Borrower; (h) to the extent such Information (i) becomes publicly available
other than as a result of a breach of this Section or (ii) becomes available to
the Administrative
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Agent or any Lender on a nonconfidential basis from a source other than the
Borrower or any Subsidiary; or (i) to the National Association of Insurance
Commissioners or any other similar organization or any nationally recognized
rating agency that requires access to information about a Lender's or its
Affiliates' investment portfolio in connection with ratings issued with respect
to such Lender or its Affiliates. In addition, the Administrative Agent and the
Lenders may disclose the existence of this Agreement and information about this
Agreement to market data collectors, similar service providers to the lending
industry, and service providers to the Administrative Agent and the Lenders in
connection with the administration and management of this Agreement, the other
Loan Documents, the Revolving Commitments, and the Credit Extensions. For the
purposes of this Section, "Information" means all information received from any
Loan Party relating to any Loan Party or its business, other than any such
information that is available to the Administrative Agent or any Lender on a
nonconfidential basis prior to disclosure by any Loan Party; provided that, in
the case of information received from a Loan Party after the date hereof, such
information is clearly identified in writing at the time of delivery as
confidential. Any Person required to maintain the confidentiality of Information
as provided in this Section shall be considered to have complied with its
obligation to do so if such Person has exercised the same degree of care to
maintain the confidentiality of such Information as such Person would accord to
its own confidential information. Notwithstanding anything herein to the
contrary, "Information" shall not include, and the Administrative Agent and each
Lender may disclose without limitation of any kind, any information with respect
to the "tax treatment" and "tax structure" (in each case, within the meaning of
Treasury Regulation Section 1.6011-4) of the transactions contemplated hereby
and all materials of any kind (including opinions or other tax analyses) that
are provided to the Administrative Agent or such Lender relating to such tax
treatment and tax structure; provided that with respect to any document or
similar item that in either case contains information concerning the tax
treatment or tax structure of the transaction as well as other information, this
sentence shall only apply to such portions of the document or similar item that
relate to the tax treatment or tax structure of the Loans, Letters of Credit and
transactions contemplated hereby.
11.09 SET-OFF.
In addition to any rights and remedies of the Lenders provided by law,
upon the occurrence and during the continuance of any Event of Default, each
Lender and any Affiliate of a Lender is authorized at any time and from time to
time, without prior notice to the Borrower or any other Loan Party, any such
notice being waived by the Borrower (on its own behalf and on behalf of each
Loan Party) 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 by, and other indebtedness at any time owing by, such Lender or such
Affiliate to or for the credit or the account of the respective Loan Parties
against any and all Obligations owing to such Lender hereunder or under any
other Loan Document, now or hereafter existing, irrespective of whether or not
the Administrative Agent or such Lender shall have made demand under this
Agreement or any other Loan Document and although such Obligations may be
contingent or unmatured or denominated in a currency different from that of the
applicable deposit or indebtedness. Each Lender agrees promptly to notify the
Borrower and the Administrative Agent after any such set-off and application
made by such Lender; provided, however, that the failure to give such notice
shall not affect the validity of such set-off and application.
11.10 INTEREST RATE LIMITATION.
Notwithstanding anything to the contrary contained in any Loan Document,
the interest paid or agreed to be paid under the Loan Documents shall not exceed
the maximum rate of non-usurious interest permitted by applicable Law (the
"Maximum Rate"). If the Administrative Agent or any Lender shall receive
interest in an amount that exceeds the Maximum Rate, the excess interest shall
be applied to the principal of the Loans or, if it exceeds such unpaid
principal, refunded to the Borrower. In determining
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whether the interest contracted for, charged, or received by the Administrative
Agent or a Lender exceeds the Maximum Rate, such Person may, to the extent
permitted by applicable Law, (a) characterize any payment that is not principal
as an expense, fee, or premium rather than interest, (b) exclude voluntary
prepayments and the effects thereof, and (c) amortize, prorate, allocate, and
spread in equal or unequal parts the total amount of interest throughout the
contemplated term of the Obligations hereunder.
11.11 COUNTERPARTS.
This Agreement may be executed in one or more counterparts, each of which
shall be deemed an original, but all of which together shall constitute one and
the same instrument.
11.12 INTEGRATION.
This Agreement, together with the other Loan Documents, comprises the
complete and integrated agreement of the parties on the subject matter hereof
and thereof and supersedes all prior agreements, written or oral, on such
subject matter. In the event of any conflict between the provisions of this
Agreement and those of any other Loan Document, the provisions of this Agreement
shall control; provided that the inclusion of supplemental rights or remedies in
favor of the Administrative Agent or the Lenders in any other Loan Document
shall not be deemed a conflict with this Agreement. Each Loan Document was
drafted with the joint participation of the respective parties thereto and shall
be construed neither against nor in favor of any party, but rather in accordance
with the fair meaning thereof.
11.13 SURVIVAL OF REPRESENTATIONS AND WARRANTIES.
All representations and warranties made hereunder and in any other Loan
Document or other document delivered pursuant hereto or thereto or in connection
herewith or therewith shall survive the execution and delivery hereof and
thereof. Such representations and warranties have been or will be relied upon by
the Administrative Agent and each Lender, regardless of any investigation made
by the Administrative Agent or any Lender or on their behalf and notwithstanding
that the Administrative Agent or any Lender may have had notice or knowledge of
any Default at the time of any Credit Extension, and shall continue in full
force and effect as long as any Loan or any other Obligation hereunder shall
remain unpaid or unsatisfied or any Letter of Credit shall remain outstanding.
11.14 SEVERABILITY.
If any provision of this Agreement or the other Loan Documents is held to
be illegal, invalid or unenforceable, (a) the legality, validity and
enforceability of the remaining provisions of this Agreement and the other Loan
Documents shall not be affected or impaired thereby and (b) the parties shall
endeavor in good faith negotiations to replace the illegal, invalid or
unenforceable provisions with valid provisions the economic effect of which
comes as close as possible to that of the illegal, invalid or unenforceable
provisions. The invalidity of a provision in a particular jurisdiction shall not
invalidate or render unenforceable such provision in any other jurisdiction.
11.15 TAX FORMS.
(a) (i) Each Lender that is not a "United States person" within the
meaning of Section 7701(a)(30) of the Internal Revenue Code (a "Foreign
Lender") shall deliver to the Administrative Agent, prior to receipt of
any payment subject to withholding under the Internal Revenue Code (or
upon accepting an assignment of an interest herein), two duly signed
completed copies of either IRS Form W-8BEN or any successor thereto
(relating to such Foreign Lender and entitling it to an exemption from, or
reduction of, withholding tax on all payments to
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be made to such Foreign Lender by the Borrower pursuant to this Agreement)
or IRS Form W-8ECI or any successor thereto (relating to all payments to
be made to such Foreign Lender by the Borrower pursuant to this Agreement)
or such other evidence satisfactory to the Borrower and the Administrative
Agent that such Foreign Lender is entitled to an exemption from, or
reduction of, U.S. withholding tax, including any exemption pursuant to
Section 881(c) of the Internal Revenue Code. Thereafter and from time to
time, each such Foreign Lender shall (A) promptly submit to the
Administrative Agent such additional duly completed and signed copies of
one of such forms (or such successor forms as shall be adopted from time
to time by the relevant United States taxing authorities) as may then be
available under then current United States laws and regulations to avoid,
or such evidence as is satisfactory to the Borrower and the Administrative
Agent of any available exemption from or reduction of, United States
withholding taxes in respect of all payments to be made to such Foreign
Lender by the Borrower pursuant to this Agreement, (B) promptly notify the
Administrative Agent of any change in circumstances which would modify or
render invalid any claimed exemption or reduction, and (C) take such steps
as shall not be materially disadvantageous to it, in the reasonable
judgment of such Lender, and as may be reasonably necessary (including the
re-designation of its Lending Office) to avoid any requirement of
applicable Laws that the Borrower make any deduction or withholding for
taxes from amounts payable to such Foreign Lender.
(ii) Each Foreign Lender, to the extent it does not act or ceases to
act for its own account with respect to any portion of any sums paid or
payable to such Lender under any of the Loan Documents (for example, in
the case of a typical participation by such Lender), shall deliver to the
Administrative Agent on the date when such Foreign Lender ceases to act
for its own account with respect to any portion of any such sums paid or
payable, and at such other times as may be necessary in the determination
of the Administrative Agent (in the reasonable exercise of its
discretion), (A) two duly signed completed copies of the forms or
statements required to be provided by such Lender as set forth above, to
establish the portion of any such sums paid or payable with respect to
which such Lender acts for its own account that is not subject to U.S.
withholding tax, and (B) two duly signed completed copies of IRS Form
W-8IMY (or any successor thereto), together with any information such
Lender chooses to transmit with such form, and any other certificate or
statement of exemption required under the Internal Revenue Code, to
establish that such Lender is not acting for its own account with respect
to a portion of any such sums payable to such Lender.
(iii) The Borrower shall not be required to pay any additional
amount to any Foreign Lender under Section 3.01 (A) with respect to any
Taxes required to be deducted or withheld on the basis of the information,
certificates or statements of exemption such Lender transmits with an IRS
Form W-8IMY pursuant to this Section 11.15(a) or (B) if such Lender shall
have failed to satisfy the foregoing provisions of this Section 11.15(a);
provided that if such Lender shall have satisfied the requirement of this
Section 11.15(a) on the date such Lender became a Lender or ceased to act
for its own account with respect to any payment under any of the Loan
Documents, nothing in this Section 11.15(a) shall relieve the Borrower of
its obligation to pay any amounts pursuant to Section 3.01 in the event
that, as a result of any change in any applicable law, treaty or
governmental rule, regulation or order, or any change in the
interpretation, administration or application thereof, such Lender is no
longer properly entitled to deliver forms, certificates or other evidence
at a subsequent date establishing the fact that such Lender or other
Person for the account of which such Lender receives any sums payable
under any of the Loan Documents is not subject to withholding or is
subject to withholding at a reduced rate.
89
(iv) The Administrative Agent may, without reduction, withhold any
Taxes required to be deducted and withheld from any payment under any of
the Loan Documents with respect to which the Borrower is not required to
pay additional amounts under this Section 11.15(a).
(b) Upon the request of the Administrative Agent, each Lender that is a
"United States person" within the meaning of Section 7701(a)(30) of the Internal
Revenue Code shall deliver to the Administrative Agent two duly signed completed
copies of IRS Form W-9. If such Lender fails to deliver such forms, then the
Administrative Agent may withhold from any interest payment to such Lender an
amount equivalent to the applicable back-up withholding tax imposed by the
Internal Revenue Code, without reduction.
(c) If any Governmental Authority asserts that the Administrative Agent
did not properly withhold or backup withhold, as the case may be, any tax or
other amount from payments made to or for the account of any Lender, such Lender
shall indemnify the Administrative Agent therefor, including all penalties and
interest, any taxes imposed by any jurisdiction on the amounts payable to the
Administrative Agent under this Section, and costs and expenses (including
Attorney Costs) of the Administrative Agent. The obligation of the Lenders under
this Section shall survive the termination of the Aggregate Revolving
Commitments, repayment of all Obligations and the resignation of the
Administrative Agent.
11.16 REPLACEMENT OF LENDERS.
Under any circumstances set forth herein providing that the Borrower shall
have the right to replace a Lender as a party to this Agreement, the Borrower
may, upon notice to such Lender and the Administrative Agent, replace such
Lender by causing such Lender to assign its Revolving Commitment and outstanding
Loans (with the assignment fee to be paid by the Borrower in such instance)
pursuant to Section 11.07(b) to one or more other Lenders or Eligible Assignees
procured by the Borrower; provided, however, that if the Borrower elects to
exercise such right with respect to any Lender pursuant to Section 3.06(b), it
shall be obligated to replace all Lenders that have made similar requests for
compensation pursuant to Section 3.01 or 3.04. The Borrower shall (x) pay in
full all principal, interest, fees and other amounts owing to such Lender
through the date of replacement (including any amounts payable pursuant to
Section 3.05), (y) provide appropriate assurances and indemnities (which may
include letters of credit) to the L/C Issuer and the Swing Line Lender as each
may reasonably require with respect to any continuing obligation to fund
participation interests in any L/C Obligations or any Swing Line Loans then
outstanding, and (z) release such Lender from its obligations under the Loan
Documents. Any Lender being replaced shall execute and deliver an Assignment and
Assumption with respect to such Lender's Revolving Commitment and outstanding
Loans and participations in L/C Obligations and Swing Line Loans.
11.17 GOVERNING LAW.
(a) THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH,
THE LAW OF THE STATE OF NEW YORK APPLICABLE TO AGREEMENTS MADE AND TO BE
PERFORMED ENTIRELY WITHIN SUCH STATE; PROVIDED THAT THE ADMINISTRATIVE AGENT AND
EACH LENDER SHALL RETAIN ALL RIGHTS ARISING UNDER FEDERAL LAW.
(b) ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT OR ANY
OTHER LOAN DOCUMENT MAY BE BROUGHT IN XXX XXXXXX XX XXX XXXXX XX XXX XXXX
SITTING IN NEW YORK, NEW YORK, OR OF THE UNITED STATES FOR THE SOUTHERN DISTRICT
OF SUCH STATE, AND BY EXECUTION AND DELIVERY OF THIS
90
AGREEMENT, THE BORROWER, THE ADMINISTRATIVE AGENT AND EACH LENDER CONSENTS, FOR
ITSELF AND IN RESPECT OF ITS PROPERTY, TO THE NON-EXCLUSIVE JURISDICTION OF
THOSE COURTS. EACH PARTY HERETO IRREVOCABLY WAIVES ANY OBJECTION, INCLUDING ANY
OBJECTION TO THE LAYING OF VENUE OR BASED ON THE GROUNDS OF FORUM NON
CONVENIENS, WHICH IT MAY NOW OR HEREAFTER HAVE TO THE BRINGING OF ANY ACTION OR
PROCEEDING IN SUCH JURISDICTION IN RESPECT OF ANY LOAN DOCUMENT OR OTHER
DOCUMENT RELATED THERETO. EACH PARTY HERETO WAIVES PERSONAL SERVICE OF ANY
SUMMONS, COMPLAINT OR OTHER PROCESS, WHICH MAY BE MADE BY ANY OTHER MEANS
PERMITTED BY THE LAW OF SUCH STATE.
11.18 WAIVER OF RIGHT TO TRIAL BY JURY.
EACH PARTY TO THIS AGREEMENT HEREBY EXPRESSLY WAIVES ANY RIGHT TO TRIAL BY JURY
OF ANY CLAIM, DEMAND, ACTION OR CAUSE OF ACTION ARISING UNDER ANY LOAN DOCUMENT
OR IN ANY WAY CONNECTED WITH OR RELATED OR INCIDENTAL TO THE DEALINGS OF THE
PARTIES HERETO OR ANY OF THEM WITH RESPECT TO ANY LOAN DOCUMENT, OR THE
TRANSACTIONS RELATED THERETO, IN EACH CASE WHETHER NOW EXISTING OR HEREAFTER
ARISING, AND WHETHER FOUNDED IN CONTRACT OR TORT OR OTHERWISE; AND EACH PARTY
HEREBY AGREES AND CONSENTS THAT ANY SUCH CLAIM, DEMAND, ACTION OR CAUSE OF
ACTION SHALL BE DECIDED BY COURT TRIAL WITHOUT A JURY, AND THAT ANY PARTY TO
THIS AGREEMENT MAY FILE AN ORIGINAL COUNTERPART OR A COPY OF THIS SECTION WITH
ANY COURT AS WRITTEN EVIDENCE OF THE CONSENT OF THE SIGNATORIES HERETO TO THE
WAIVER OF THEIR RIGHT TO TRIAL BY JURY.
11.19 DESIGNATED SENIOR INDEBTEDNESS.
(a) The parties hereto intend for this Agreement to be the "Credit
Agreement" under, and as defined in, the Senior Subordinated Notes Documents. If
for any reason this Agreement is not deemed to be the "Credit Agreement" under,
and as defined in, the Senior Subordinated Notes Documents, the Borrower hereby
specifically designates the Obligations as "Designated Senior Debt" for purposes
of the Senior Subordinated Notes Documents.
(b) The Lenders hereby appoint the Administrative Agent as administrative
agent for purposes of the Sunrise Subordination Agreement and agree that the
Administrative Agent shall be the "Agent" for purposes of the Sunrise
Subordination Agreement.
11.20 COLLATERAL AND GUARANTY MATTERS.
The Administrative Agent agrees, so long as no Default or Event of Default
has occurred and is continuing:
(a) to release any Lien on any Collateral granted to or held by the
Administrative Agent under any Loan Document (i) upon termination of the
Aggregate Revolving Commitments and payment in full of all Obligations
(other than contingent indemnification obligations) and the expiration or
termination of all Letters of Credit, (ii) that is transferred or to be
transferred as part of or in connection with any Disposition permitted
hereunder or under any other Loan Document or any Involuntary Disposition,
or (iii) as approved in accordance with Section 11.01; and
91
(b) to release any Guarantor from its obligations under the Guaranty
if such Person ceases to be a Subsidiary as a result of a transaction
permitted hereunder.
11.21 USA PATRIOT ACT NOTICE.
Each Lender and the Administrative Agent (for itself and not on behalf of
any Lender) hereby notifies the Borrower that pursuant to the requirements of
the USA Patriot Act (Title III of Pub. L. 107-56 (signed into law October 26,
2001)) (the "Act"), it is required to obtain, verify and record information that
identifies the Borrower, which information includes the name and address of the
Borrower and other information that will allow such Lender or the Administrative
Agent, as applicable, to identify the Borrower in accordance with the Act.
[SIGNATURE PAGES FOLLOW]
92
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the date first above written.
BORROWER:
PSYCHIATRIC SOLUTIONS, INC., a Delaware corporation
By: /s/ Xxxxx Xxxxxx
-------------------------------
Name: Xxxxx Xxxxxx
Title: Treasurer
GUARANTORS:
AERIES HEALTHCARE CORPORATION, a Delaware corporation
AERIES HEALTHCARE OF ILLINOIS, INC., an Illinois corporation
BOUNTIFUL PSYCHIATRIC HOSPITAL, INC., a Utah corporation
BRENTWOOD ACQUISITION, INC., a Tennessee corporation
BRENTWOOD ACQUISITION - SHREVEPORT, INC., a Delaware corporation
COLLABORATIVE CARE CORPORATION, a Tennessee corporation
EAST CAROLINA PSYCHIATRIC SERVICES CORPORATION, a North Carolina corporation
FORT LAUDERDALE HOSPITAL, INC., a Florida corporation
GREAT PLAINS HOSPITAL, INC., a Missouri corporation
GULF COAST TREATMENT CENTER, INC., a Florida corporation
H.C. CORPORATION, an Alabama corporation
HAVENWYCK HOSPITAL INC., a Michigan corporation
HSA HILL CREST CORPORATION, an Alabama corporation
HSA OF OKLAHOMA, INC., an Oklahoma corporation
INFOSCRIBER CORPORATION, a Delaware corporation
LAURELWOOD CENTER, INC., a Mississippi corporation
MICHIGAN PSYCHIATRIC SERVICES, INC., a Michigan corporation
PEAK BEHAVIORAL HEALTH SERVICES, INC., a Delaware corporation
PREMIER BEHAVIORAL SOLUTIONS, INC., a Delaware corporation
PREMIER BEHAVIORAL SOLUTIONS OF ALABAMA, INC., a Delaware corporation
PSI CEDAR SPRINGS HOSPITAL, INC., a Delaware corporation
PSI COMMUNITY MENTAL HEALTH AGENCY MANAGEMENT, INC., a Tennessee corporation
PSI-EAP, INC., a Delaware corporation
PSI HOSPITALS, INC., a Delaware corporation
PSI PRIDE INSTITUTE, INC., a Minnesota corporation
PSI SUMMIT HOSPITAL, INC., a New Jersey corporation
PSYCHIATRIC MANAGEMENT RESOURCES, INC., a California corporation
PSYCHIATRIC PRACTICE MANAGEMENT OF ARKANSAS, INC., a Tennessee corporation
PSYCHIATRIC SOLUTIONS HOSPITALS, INC., a Delaware corporation
PSYCHIATRIC SOLUTIONS OF ALABAMA, INC. a Tennessee corporation
PSYCHIATRIC SOLUTIONS OF ARIZONA, INC., a Delaware corporation
By: /s/ Xxxxx Xxxxxx
-------------------------------
Name: Xxxxx Xxxxxx
Title: Vice President of each of the foregoing Guarantors
[SIGNATURE PAGES CONTINUE]
PSYCHIATRIC SOLUTIONS OF LEESBURG, INC., a Tennessee corporation
PSYCHIATRIC SOLUTIONS OF NORTH CAROLINA, INC., a Tennessee corporation
PSYCHIATRIC SOLUTIONS OF OKLAHOMA, INC., a Delaware corporation
PSYCHIATRIC SOLUTIONS OF SOUTH CAROLINA, INC., a Delaware corporation
PSYCHIATRIC SOLUTIONS OF TENNESSEE, INC., a Tennessee corporation
PSYCHIATRIC SOLUTIONS OF VIRGINIA, INC., a Tennessee corporation
RAMSAY MANAGED CARE, INC., a Delaware corporation
RAMSAY TREATMENT SERVICES, INC., a Delaware corporation
RAMSAY YOUTH SERVICES OF FLORIDA, INC., a Delaware corporation
RAMSAY YOUTH SERVICES OF GEORGIA, INC., a Delaware corporation
RHCI SAN ANTONIO, INC., a Delaware corporation
SOLUTIONS CENTER OF LITTLE ROCK, INC., a Tennessee corporation
SUNSTONE BEHAVIORAL HEALTH, INC., a Tennessee corporation
THE COUNSELING CENTER OF MIDDLE TENNESSEE, INC., a Tennessee corporation
TRANSITIONAL CARE VENTURES, INC., a Delaware corporation
TRANSITIONAL CARE VENTURES (TEXAS), INC., a Delaware corporation
PSI TEXAS HOSPITALS, LLC, a Texas limited liability company
THERAPEUTIC SCHOOL SERVICES, LLC, an Oklahoma limited liability company
By: /s/ Xxxxx Xxxxxx
-------------------------------
Name: Xxxxx Xxxxxx
Title: Vice President of each of the foregoing Guarantors
MILLWOOD HOSPITAL, L.P., a Texas limited partnership
NEURO INSTITUTE OF AUSTIN, L.P., a Texas limited partnership
TEXAS CYPRESS CREEK HOSPITAL, L.P., a Texas limited partnership
TEXAS XXXXXX XXXXX HOSPITAL, L.P., a Texas limited partnership
TEXAS OAKS PSYCHIATRIC HOSPITAL, L.P., a Texas limited partnership
TEXAS SAN MARCOS TREATMENT CENTER, L.P., a Texas limited partnership
TEXAS WEST OAKS HOSPITAL, L.P., a Texas limited partnership
By: PSI TEXAS HOSPITALS, LLC, its general partner
By: PSYCHIATRIC SOLUTIONS HOSPITALS, INC., its sole member
By: /s/ Xxxxx Xxxxxx
-------------------------------
Name: Xxxxx Xxxxxx
Title: Vice President
[SIGNATURE PAGES CONTINUE]
H.C. PARTNERSHIP, an Alabama general partnership
By: H.C. CORPORATION, its general partner
By: /s/ Xxxxx Xxxxxx
-------------------------------
Name: Xxxxx Xxxxxx
Title: Vice President
HSA HILL CREST CORPORATION, its general partner
By: /s/ Xxxxx Xxxxxx
-------------------------------
Name: Xxxxx Xxxxxx
Title: Vice President
PALMETTO BEHAVIORAL HEALTH SYSTEM, L.L.C., a South Carolina limited liability
company
By: PSYCHIATRIC SOLUTIONS OF SOUTH CAROLINA, INC., its sole member
By: /s/ Xxxxx Xxxxxx
-------------------------------
Name: Xxxxx Xxxxxx
Title: Vice President
PALMETTO LOWCOUNTRY BEHAVIORAL HEALTH, L.L.C.,
a South Carolina limited liability company
By: PALMETTO BEHAVIORAL HEALTH SYSTEM, L.L.C., its sole member
By: PSYCHIATRIC SOLUTIONS OF SOUTH CAROLINA, INC., its sole member
By: /s/ Xxxxx Xxxxxx
-------------------------------
Name: Xxxxx Xxxxxx
Title: Vice President
PALMETTO PEE DEE BEHAVIORAL HEALTH, L.L.C., a South Carolina limited liability
company
By: PALMETTO BEHAVIORAL HEALTH SYSTEM, L.L.C., its sole member
By: PSYCHIATRIC SOLUTIONS OF SOUTH CAROLINA, INC., its sole member
By: /s/ Xxxxx Xxxxxx
-------------------------------
Name: Xxxxx Xxxxxx
Title: Vice President
[SIGNATURE PAGES CONTINUE]
ADMINISTRATIVE
AGENT: BANK OF AMERICA, N.A., as Administrative Agent
By: /s/ Xxxxxxx Xxxxxxxx
-----------------------------------
Name: Xxxxxxx Xxxxxxxx
Title: Vice President
LENDERS: BANK OF AMERICA, N.A.,
as a Lender, L/C Issuer and Swing Line Lender
By: /s/ Xxxxxxxxx X. Xxxx
-----------------------------------
Name: Xxxxxxxxx X. Xxxx
Title: Senior Vice President
XXXXXXX XXXXX CAPITAL CORPORATION
By: /s/ Xxxxxxx X. X'Xxxxx
-----------------------------------
Name: Xxxxxxx X. X'Xxxxx
Title: Vice President
CITICORP USA, INC.
By: /s/ Xxxxxxx X. Xxxxxx
-----------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: Vice President
XXXXXX COMMERCIAL PAPER, INC.
By: /s/ Xxxxxxx Xxxxx
-----------------------------------
Name: Xxxxxxx Xxxxx
Title: Authorized Signatory
GENERAL ELECTRIC CAPITAL CORPORATION
By: /s/ Xxxxx X. Xxxxxx
-----------------------------------
Name: Xxxxx X. Xxxxxx
Title: Duly Authorized Signatory
AMSOUTH BANK
By: /s/ Xxxx Xxxxxx
-----------------------------------
Name: Xxxx Xxxxxx
Title: Vice President
FIFTH THIRD BANK
By: /s/ Xxxxx Xxxxxxx
-----------------------------------
Name: Xxxxx Xxxxxxx
Title:
[SIGNATURE PAGES CONTINUE]
UNION PLANTERS BANK, N.A.
By: /s/ Xxxxx X. Xxxxxxxx
-----------------------------------
Name: Xxxxx X. Xxxxxxxx
Title: Vice President
FIRST TENNESSEE BANK NATIONAL ASSOCIATION
By: /s/ X. Xxxxxxxx Xxxxxx XX
-----------------------------------
Name: X. Xxxxxxxx Galyon IV
Title: Vice President
JPMORGAN CHASE BANK, N.A.
(successor by merger to Bank One, NA (Main Office
Chicago))
By: /s/ Xxxxxxx X. Xxxxx
-----------------------------------
Name: Xxxxxxx X. Xxxxx
Title: Vice President
LASALLE BANK NATIONAL ASSOCIATION
By: /s/ Xxxxx Xxxxxxx
-----------------------------------
Name: Xxxxx Xxxxxxx
Title: Vice President
