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EXHIBIT 10.8
CREDIT AGREEMENT
Dated as of September 30, 1999
among
THE BORROWERS FROM TIME TO TIME PARTY HERETO
HCR/ALTERRA DEVELOPMENT, LLC,
as Guarantor
THE SEVERAL LENDERS
FROM TIME TO TIME PARTY HERETO
BANK OF AMERICA, N. A.,
as Administrative Agent
THE CHASE MANHATTAN BANK,
as Syndication Agent
AND
DEUTSCHE BANK AG NEW YORK AND/OR CAYMAN ISLANDS BRANCHES and
BANK UNITED, F.S.B.
as Co-Agents
Arranged by:
BANC OF AMERICA SECURITIES LLC,
as Sole Lead Arranger and
Sole Book Manager
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TABLE OF CONTENTS
Page
SECTION 1 DEFINITIONS............................................................................................1
1.1 Definitions..........................................................................................1
1.2 Computation of Time Periods.........................................................................27
1.3 Accounting Terms....................................................................................27
SECTION 2 CREDIT FACILITIES.....................................................................................27
2.1Revolving Loans......................................................................................27
2.2Extension of Maturity Date...........................................................................30
2.3Additional Borrowers.................................................................................31
2.4Joint and Several Liability among Pool Borrowers.....................................................32
2.5Removal of a Borrower................................................................................38
2.6Appointment of Designated Borrower as Agent for Borrowers............................................38
SECTION 3 OTHER PROVISIONS RELATING TO CREDIT FACILITIES........................................................39
3.1Default Rate.........................................................................................39
3.2Extension and Conversion.............................................................................39
3.3Prepayments..........................................................................................40
3.4Termination and Reduction of Revolving Committed Amount..............................................41
3.5Fees.................................................................................................42
3.6Capital Adequacy.....................................................................................42
3.7Limitation on Eurodollar Loans.......................................................................43
3.8Illegality...........................................................................................43
3.9Requirements of Law..................................................................................44
3.10Treatment of Affected Loans.........................................................................45
3.11Taxes...............................................................................................45
3.12Compensation........................................................................................47
3.13Pro Rata Treatment..................................................................................48
3.14Sharing of Payments.................................................................................49
3.15Payments, Computations, Etc.........................................................................49
3.16Evidence of Debt....................................................................................53
3.17Substitution of Lenders.............................................................................54
SECTION 4 GUARANTY..............................................................................................55
4.1The Parent Guaranty..................................................................................55
4.2Obligations Unconditional............................................................................55
4.3Reinstatement........................................................................................57
4.4Certain Additional Waivers...........................................................................57
4.5Remedies.............................................................................................57
4.6Guarantee of Payment; Continuing Guarantee...........................................................57
SECTION 5 CONDITIONS............................................................................................58
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5.1 Closing Conditions..................................................................................58
5.2 Conditions to all Extensions of Credit..............................................................63
5.3 Conditions to Revolving Loans to Finance Construction or Refinancing of New Properties..............67
SECTION 6 REPRESENTATIONS AND WARRANTIES........................................................................67
6.1 Financial Condition.................................................................................67
6.2 No Material Change..................................................................................67
6.3 Organization and Good Standing......................................................................68
6.4 Power; Authorization; Enforceable Obligations.......................................................68
6.5 No Conflicts........................................................................................68
6.6 No Default..........................................................................................69
6.7 Ownership...........................................................................................69
6.8 Litigation..........................................................................................69
6.9 Taxes...............................................................................................69
6.10 Compliance with Law................................................................................69
6.11 ERISA..............................................................................................70
6.12 Subsidiaries.......................................................................................71
6.13 Governmental Regulations, Etc......................................................................71
6.14 Purpose of Loans...................................................................................72
6.15 Environmental Matters..............................................................................73
6.16 Intellectual Property..............................................................................74
6.17 Solvency...........................................................................................74
6.18 Location of Collateral.............................................................................74
6.19 Disclosure.........................................................................................74
6.20 No Burdensome Restrictions.........................................................................74
6.21 Labor Matters......................................................................................75
6.22 Year 2000 Compliance...............................................................................75
6.23 First Priority Lien................................................................................75
SECTION 7 AFFIRMATIVE COVENANTS.................................................................................75
7.1 Information Covenants...............................................................................75
7.2 Preservation of Existence and Franchises............................................................79
7.3 Books and Records...................................................................................79
7.4 Compliance with Law.................................................................................79
7.5 Payment of Taxes and Other Indebtedness.............................................................79
7.6 Insurance...........................................................................................79
7.7 Maintenance of Property.............................................................................81
7.8 Performance of Obligations..........................................................................81
7.9 Use of Proceeds.....................................................................................82
7.10 Audits/Inspections.................................................................................82
7.11 Financial Covenants................................................................................82
7.12 Environmental Laws.................................................................................82
7.13 Collateral.........................................................................................83
7.14 Year 2000 Compliance...............................................................................83
7.15 Construction Inspector.............................................................................84
7.16 Surveys............................................................................................84
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7.17 Environmental Indemnity............................................................................84
SECTION 8 NEGATIVE COVENANTS....................................................................................86
8.1 Indebtedness........................................................................................86
8.2 Liens...............................................................................................87
8.3 Nature of Business..................................................................................88
8.4 Consolidation, Merger, Dissolution, etc.............................................................88
8.5 Asset Dispositions..................................................................................88
8.6 Investments.........................................................................................89
8.7 Restricted Payments.................................................................................89
8.8 Prepayments of Indebtedness, etc....................................................................90
8.9 Transactions with Affiliates........................................................................90
8.10 Fiscal Year; Organizational Documents..............................................................90
8.11 Limitation on Restricted Actions...................................................................90
8.12 Sale Leasebacks....................................................................................91
8.13 No Further Negative Pledges........................................................................91
8.14 Construction.......................................................................................91
8.15 Changes to Plans and Specifications................................................................91
8.16 Transfer of Partnership Interests..................................................................92
SECTION 9 EVENTS OF DEFAULT.....................................................................................92
9.1 Events of Default...................................................................................92
9.2 Acceleration; Remedies..............................................................................99
SECTION 10 AGENCY PROVISIONS...................................................................................100
10.1 Appointment, Powers and Immunities................................................................100
10.2 Reliance by Administrative Agent..................................................................101
10.3 Defaults..........................................................................................102
10.4 Rights as a Lender................................................................................102
10.5 Indemnification...................................................................................102
10.6 Non-Reliance on Administrative Agent and Other Lenders............................................103
10.7 Successor Administrative Agent....................................................................103
SECTION 11 MISCELLANEOUS.......................................................................................104
11.1 Notices...........................................................................................104
11.2 Right of Set-Off; Adjustments.....................................................................106
11.3 Benefit of Agreement..............................................................................106
11.4 No Waiver; Remedies Cumulative....................................................................108
11.5 Expenses; Indemnification.........................................................................108
11.6 Amendments, Waivers and Consents..................................................................109
11.7 Counterparts......................................................................................111
11.8 Headings..........................................................................................111
11.9 Survival..........................................................................................111
11.10 Governing Law; Submission to Jurisdiction; Venue.................................................111
11.11 Severability..................................................................................112
11.12 Entirety......................................................................................112
11.13 Binding Effect; Termination...................................................................113
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11.14 Confidentiality...............................................................................113
11.15 Conflict......................................................................................113
11.16 Source of Funds...............................................................................113
11.17 Release of Liens..............................................................................114
SCHEDULES
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Schedule 1.1(a) Development Agreements
Schedule 1.1(b) Management Agreements
Schedule 1.1(c) Pool A Borrowers
Schedule 2.1(a)(i) Lenders
Schedule 2.1(a)(ii) Pool B Properties
Schedule 5.1(e)(i) Existing Properties
Schedule 6.12 Subsidiaries
Schedule 6.16 Intellectual Property
Schedule 6.18(a) Real Property Locations
Schedule 6.18(b) Personal Property Locations
Schedule 6.18(c) Chief Executive Offices/Principal Places of Business
Schedule 7.6 Insurance
Schedule 8.1(e) Subordinated Debt
EXHIBITS
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Exhibit 1.1(a) Form of Alterra Guaranty Agreement
Exhibit 1.1(b) Form of HCR Guaranty Agreement
Exhibit 2.1(b)(i) Form of Notice of Borrowing
Exhibit 2.1(e) Form of Revolving Note
Exhibit 2.3(i) Form of Joinder Agreement
Exhibit 2.3(ii) Form of Pledge Supplement Agreement
Exhibit 3.2 Form of Notice of Extension/Conversion
Exhibit 7.1(d) Form of Officer's Compliance Certificate
Exhibit 7.1(f) Form of Borrowing Base Certificate
Exhibit 11.3(b) Form of Assignment and Acceptance
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CREDIT AGREEMENT
THIS CREDIT AGREEMENT, dated as of September 30, 1999 (as amended,
modified, restated or supplemented from time to time, the "Credit Agreement"),
is by and among the Borrowers (as defined herein), HCR/ALTERRA DEVELOPMENT, LLC,
a Delaware limited liability company (the "Parent"), the Lenders (as defined
herein), BANK OF AMERICA, N.A., as Administrative Agent for the Lenders (in such
capacity, the "Administrative Agent"), THE CHASE MANHATTAN BANK, as Syndication
Agent (in such capacity, the "Syndication Agent") and DEUTSCHE BANK AG NEW YORK
AND/OR CAYMAN ISLANDS BRANCHES and BANK UNITED, F.S.B., as Co-Agents (in such
capacity, the "Co-Agents").
W I T N E S S E T H
WHEREAS, the Borrowers have requested that the Lenders provide a
$200,000,000 credit facility for the purposes hereinafter set forth; and
WHEREAS, the Lenders have agreed to make the requested credit facility
available to the Borrowers on the terms and conditions hereinafter set forth;
NOW, THEREFORE, IN CONSIDERATION of the premises and other good and
valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the parties hereto agree as follows:
SECTION 1
DEFINITIONS
1.1 DEFINITIONS.
As used in this Credit Agreement, the following terms shall have the
meanings specified below unless the context otherwise requires:
"Adjusted Base Rate" means the Base Rate plus the Applicable
Percentage.
"Adjusted Eurodollar Rate" means the Eurodollar Rate plus the
Applicable Percentage.
"Administrative Agent" shall have the meaning assigned to such
term in the heading hereof, together with any successors or assigns.
"Administrative Agent's Fee Letter" means that certain letter
agreement, dated as of June 11, 1999, between the Administrative Agent
and the Partners, as amended, modified, restated or supplemented from
time to time.
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"Administrative Agent's Fees" shall have the meaning assigned
to such term in Section 3.5(c).
"Affiliate" means, with respect to any Person, any other
Person (i) directly or indirectly controlling or controlled by or under
direct or indirect common control with such Person or (ii) directly or
indirectly owning or holding five percent (5%) or more of the Capital
Stock in such Person. For purposes of this definition, "control" when
used with respect to any Person means the power to direct the
management and policies of such Person, directly or indirectly, whether
through the ownership of voting securities, by contract or otherwise;
and the terms "controlling" and "controlled" have meanings correlative
to the foregoing.
"Agency Services Address" means Bank of America, N.A.,
Independence Center, 15th Floor, NC1-001-15-04, 000 X. Xxxxx Xxxxxx,
Xxxxxxxxx, Xxxxx Xxxxxxxx 00000, Attn: Agency Services, or such other
address as may be identified by written notice from the Administrative
Agent to the Borrowers.
"Alterra" means Alterra Healthcare Corporation, a Delaware
corporation.
"Alterra Guaranty Agreement" means the guaranty agreement
dated as of the Closing Date in the form of Exhibit 1.1(a) executed by
Alterra, as amended, modified, restated or supplemented from time to
time.
"Applicable Lending Office" means, for each Lender, the office
of such Lender (or of an Affiliate of such Lender) as such Lender may
from time to time specify to the Administrative Agent and the Borrowers
by written notice as the office by which its Eurodollar Loans are made
and maintained.
"Applicable Percentage" means, for any day, the rate per annum
set forth below opposite the applicable Senior Debt Rating then in
effect, it being understood that the Applicable Percentage for (i)
Eurodollar Loans shall be the percentage set forth under the column
"Applicable Percentage for Eurodollar Loans", (ii) Base Rate Loans
shall be the percentage set forth under the column "Applicable
Percentage for Base Rate Loans" and (iii) Unused Fee shall be the
percentage set forth under the column "Applicable Percentage for Unused
Fee". The Applicable Percentage shall be determined based on the Senior
Debt Rating; provided that (a) if either S&P or Xxxxx'x shall not have
a Senior Debt Rating for HCR, then the Applicable Percentages shall be
based on Pricing Level IV, (b) if there is a split Senior Debt Rating
with a difference of only one pricing level, then the higher of the two
ratings shall apply and (c) if there is a split Senior Debt Rating with
a difference of more than one pricing level, then the Applicable
Percentages shall be based on the Pricing Level one level below the
Pricing Level corresponding to the higher of the two ratings and both
of the actual Senior Debt Ratings will be disregarded.
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Applicable Applicable Applicable
Percentage for Percentage for Percentage for
Pricing Xxxxx'x Rating Eurodollar Loans Base Rate Loans Unused Fee
Level S&P Rating
-------------- ------------------- ------------------ ------------------- ------------------ -------------------
I >BBB+ >Baa1 1.125% .125% .225%
- -
-------------- ------------------- ------------------ ------------------- ------------------ -------------------
II BBB Baa2 1.375% .375% .25%
-------------- ------------------- ------------------ ------------------- ------------------ -------------------
III BBB- Baa3 1.75% .75% .375%
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