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Exhibit 10.124
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Up to U.S. $9,000,000
AMENDED AND RESTATED CREDIT AGREEMENT
Dated as of September 30, 1998
among
RAMSAY HEALTH CARE, INC.,
as Borrower
THE LENDERS FROM TIME TO TIME PARTY HERETO,
as Lenders
and
GENERAL ELECTRIC CAPITAL CORPORATION,
as Administrative Agent
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TABLE OF CONTENTS
ARTICLE 1
AMOUNT AND TERMS OF CREDIT
SECTION 1.01. REVOLVING CREDIT ADVANCES...........................................2
SECTION 1.02. PAYMENTS AND PREPAYMENTS; TERMINATION OF
REVOLVING CREDIT COMMITMENT.........................................3
SECTION 1.03. USE OF PROCEEDS.....................................................5
SECTION 1.04. LETTERS OF CREDIT...................................................5
SECTION 1.05. INTEREST............................................................5
SECTION 1.06. BORROWING BASE......................................................5
SECTION 1.07. FEES................................................................6
SECTION 1.08. RECEIPT OF PAYMENTS.................................................6
SECTION 1.09. FUNDING, PAYMENTS; NON-FUNDING LENDERS..............................7
SECTION 1.10. APPLICATION AND ALLOCATION OF PAYMENTS..............................8
SECTION 1.11. LOAN ACCOUNT AND ACCOUNTING.........................................9
SECTION 1.12. INDEMNITY...........................................................9
SECTION 1.13. ACCESS.............................................................10
SECTION 1.14. TAXES..............................................................11
SECTION 1.15. CAPITAL ADEQUACY; INCREASED COSTS; ILLEGALITY......................11
SECTION 1.16. SINGLE OBLIGATION..................................................13
ARTICLE 2
CONDITIONS TO EFFECTIVENESS OF THIS AGREEMENT;
EFFECT OF AMENDMENT AND RESTATEMENT;
EXTENSIONS OF CREDIT ON AND AFTER EFFECTIVE DATE
SECTION 2.01. CONDITIONS TO EFFECTIVENESS OF THIS AGREEMENT......................13
SECTION 2.02. CONFIRMATION OF EFFECTIVENESS......................................14
SECTION 2.03. EFFECT OF AMENDMENT AND RESTATEMENT................................15
SECTION 2.04. FURTHER CONDITIONS TO EACH REVOLVING CREDIT
ADVANCE AND LETTER OF CREDIT OBLIGATION ON AND
AFTER THE EFFECTIVE DATE...........................................15
ARTICLE 3
REPRESENTATIONS AND WARRANTIES
SECTION 3.01. CORPORATE EXISTENCE; COMPLIANCE WITH LAW...........................16
SECTION 3.02. EXECUTIVE OFFICES; COLLATERAL LOCATIONS;
CORPORATE OR OTHER NAMES...........................................17
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SECTION 3.03. CORPORATE POWER; AUTHORIZATION;
ENFORCEABLE OBLIGATIONS............................................17
SECTION 3.04. FINANCIAL STATEMENTS AND PROJECTIONS...............................17
SECTION 3.05. MATERIAL ADVERSE EVENTS............................................17
SECTION 3.06. OWNERSHIP OF PROPERTY; LIENS.......................................18
SECTION 3.07. RESTRICTIONS; NO DEFAULT; MATERIAL CONTRACTS.......................18
SECTION 3.08. LABOR MATTERS......................................................18
SECTION 3.09. VENTURES, SUBSIDIARIES AND AFFILIATES;
OUTSTANDING STOCK AND INDEBTEDNESS.................................19
SECTION 3.10. GOVERNMENT REGULATION..............................................19
SECTION 3.11. MARGIN REGULATIONS.................................................19
SECTION 3.12. TAXES..............................................................20
SECTION 3.13. ERISA..............................................................20
SECTION 3.14. NO LITIGATION......................................................21
SECTION 3.15. BROKERS............................................................22
SECTION 3.16. PATENTS, TRADEMARKS, COPYRIGHTS AND LICENSES.......................22
SECTION 3.17. FULL DISCLOSURE....................................................22
SECTION 3.18. ENVIRONMENTAL MATTERS..............................................23
SECTION 3.19. INSURANCE POLICIES.................................................24
SECTION 3.20. DEPOSIT AND DISBURSEMENT ACCOUNTS..................................24
SECTION 3.21. SOLVENCY...........................................................24
SECTION 3.22. SUBORDINATION OF SUBORDINATED INDEBTEDNESS.........................24
SECTION 3.23. LICENSES AND PERMITS...............................................25
SECTION 3.24. COMPLIANCE WITH LAW................................................25
SECTION 3.25. HEALTH CARE PROFESSIONALS..........................................25
SECTION 3.26. MANAGEMENT AGREEMENTS..............................................26
SECTION 3.27. PATIENT REFERRALS, ETC.............................................26
SECTION 3.28. PENDING REVOCATIONS, ETC...........................................26
SECTION 3.29. INVESTIGATIONS AND AUDITS..........................................27
SECTION 3.30. PAYMENT ADJUSTMENTS................................................27
SECTION 3.31. CERTAIN AGREEMENTS.................................................27
SECTION 3.32. RELATED TRANSACTIONS...............................................27
ARTICLE 4
FINANCIAL STATEMENTS AND INFORMATION
SECTION 4.01. REPORTS AND NOTICES................................................28
SECTION 4.02. COMMUNICATION WITH ACCOUNTANTS.....................................28
ARTICLE 5
AFFIRMATIVE COVENANTS
SECTION 5.01. MAINTENANCE OF EXISTENCE AND CONDUCT OF BUSINESS...................28
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SECTION 5.02. PAYMENT OF CHARGES AND CLAIMS......................................28
SECTION 5.03. BOOKS AND RECORDS..................................................29
SECTION 5.04. LITIGATION.........................................................29
SECTION 5.05. INSURANCE..........................................................29
SECTION 5.06. COMPLIANCE WITH LAWS...............................................30
SECTION 5.07. AGREEMENTS.........................................................30
SECTION 5.08. ENVIRONMENTAL MATTERS..............................................30
SECTION 5.09. CERTAIN OBLIGATIONS RESPECTING SUBSIDIARIES........................31
SECTION 5.10. APPLICATION OF PROCEEDS............................................31
SECTION 5.11. FISCAL YEAR........................................................32
SECTION 5.12. CASUALTY AND CONDEMNATION..........................................32
SECTION 5.13. APPLICATION OF CERTAIN PROCEEDS....................................33
SECTION 5.14. ADDITIONAL MORTGAGED PROPERTIES;
ADDITIONAL CREDIT PARTIES..........................................34
SECTION 5.15. PERMITS, ETC.......................................................35
SECTION 5.16. FURTHER ASSURANCES.................................................35
SECTION 5.17. RAMSAY COMMON STOCK SUBSCRIPTION AGREEMENT.........................36
ARTICLE 6
NEGATIVE COVENANTS
SECTION 6.01. ACQUISITIONS.......................................................36
SECTION 6.02. MERGERS, SUBSIDIARIES, INTERCOMPANY TRANSFERS, ETC.................36
SECTION 6.03. INVESTMENTS........................................................36
SECTION 6.04. INDEBTEDNESS.......................................................37
SECTION 6.05. AFFILIATE AND EMPLOYEE LOANS AND TRANSACTIONS......................37
SECTION 6.06. GUARANTEED INDEBTEDNESS............................................38
SECTION 6.07. LIENS..............................................................38
SECTION 6.08. SALE OF STOCK AND ASSETS...........................................38
SECTION 6.09. MATERIAL CONTRACTS.................................................39
SECTION 6.10. ERISA..............................................................39
SECTION 6.11. FINANCIAL COVENANTS................................................39
SECTION 6.12. HAZARDOUS MATERIALS................................................39
SECTION 6.13. SALE-LEASEBACKS....................................................40
SECTION 6.14. CANCELLATION OF INDEBTEDNESS.......................................40
SECTION 6.15. RESTRICTED PAYMENTS................................................40
SECTION 6.16. NO SPECULATIVE TRANSACTIONS........................................40
SECTION 6.17. MARGIN REGULATIONS.................................................41
SECTION 6.18. LIMITATION ON NEGATIVE PLEDGE CLAUSES, ETC.........................41
SECTION 6.19. ACCOUNTING CHANGES.................................................41
SECTION 6.20. CHANGES RELATING TO SUBORDINATED DEBT..............................41
SECTION 6.21. LEASES.............................................................41
SECTION 6.22. TAX SHARING AGREEMENTS.............................................42
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ARTICLE 7
TERM
SECTION 7.01. DURATION...........................................................42
SECTION 7.02. SURVIVAL OF OBLIGATIONS............................................42
ARTICLE 8
EVENTS OF DEFAULT; RIGHTS AND REMEDIES
SECTION 8.01. EVENTS OF DEFAULT..................................................42
SECTION 8.02. REMEDIES...........................................................45
SECTION 8.03. WAIVERS BY CREDIT PARTIES..........................................46
ARTICLE 9
THE ADMINISTRATIVE AGENT
SECTION 9.01. APPOINTMENT OF THE ADMINISTRATIVE AGENT............................46
SECTION 9.02. THE ADMINISTRATIVE AGENT'S RELIANCE, ETC...........................47
SECTION 9.03. GE CAPITAL AND AFFILIATES..........................................48
SECTION 9.04. LENDER CREDIT DECISION.............................................48
SECTION 9.05. INDEMNIFICATION....................................................48
SECTION 9.06. SUCCESSOR ADMINISTRATIVE AGENT.....................................49
SECTION 9.07. DISSEMINATION OF INFORMATION.......................................50
SECTION 9.08. RELEASE OF COLLATERAL..............................................50
ARTICLE 10
SUCCESSORS AND ASSIGNS
SECTION 10.01. SUCCESSORS AND ASSIGNS.............................................50
SECTION 10.02. ASSIGNMENTS AND PARTICIPATIONS.....................................51
ARTICLE 11
MISCELLANEOUS
SECTION 11.01. COMPLETE AGREEMENT.................................................52
SECTION 11.02. AMENDMENTS AND WAIVERS.............................................53
SECTION 11.03. FEES AND EXPENSES; CERTAIN TAXES...................................54
SECTION 11.04. NO WAIVER..........................................................55
SECTION 11.05. REMEDIES...........................................................56
SECTION 11.06. SEVERABILITY.......................................................56
SECTION 11.07. CONFLICT OF TERMS..................................................56
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SECTION 11.08. SETOFF AND SHARING OF PAYMENTS.....................................56
SECTION 11.09. AUTHORIZED SIGNATURE...............................................57
SECTION 11.10. NOTICES............................................................57
SECTION 11.11. SECTION TITLES.....................................................59
SECTION 11.12. COUNTERPARTS.......................................................59
SECTION 11.13. TIME OF THE ESSENCE................................................59
SECTION 11.14. PUBLICITY..........................................................59
SECTION 11.15. CONFIDENTIALITY....................................................59
SECTION 11.16. GOVERNING LAW......................................................60
SECTION 11.17. WAIVER OF JURY TRIAL...............................................61
SECTION 11.18. ESTOPPEL...........................................................61
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INDEX OF ANNEXES, SCHEDULES AND EXHIBITS
Annex A - Definitions; Rules of Construction
Annex B - Letters of Credit
Annex C - Interest Rates, Etc.
Annex D - Schedule of Closing Documents
Annex E - Insurance Requirements
Annex F - Financial Statements, Projections and Notices
Annex G - Financial Covenants
Schedule 1.01 - Mortgaged Property
Schedule 3.02 - Executive Offices; Other Places of Business
and Collateral Locations; Trade Names
Schedule 3.04 - Financial Statements and Projections
Schedule 3.05 - Contingent Liabilities; Restricted Payments
Schedule 3.06 - Real Property and Leases
Schedule 3.07 - Material Contracts
Schedule 3.09 - Subsidiaries, Joint Ventures and Affiliates; Outstanding
Stock; Indebtedness Held by Credit Parties; Inactive
Subsidiaries; Material Subsidiaries
Schedule 3.12 - Tax Matters
Schedule 3.13 - ERISA Plans
Schedule 3.14 - Litigation
Schedule 3.18 - Certain Environmental Matters
Schedule 3.31 - Certain Agreements
Schedule 6.03 - Investments
Schedule 6.05 - Transactions with Affiliates and Employees
Schedule 6.07 - Liens
Schedule 11.09 - Authorized Signatures
Exhibit A - Form of Notice of Revolving Credit Advance
Exhibit B - Form of Revolving Credit Note
Exhibit C - Form of Assignment Agreement
Exhibit D - Form of Opinion of Borrower's Counsel
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AMENDED AND RESTATED CREDIT AGREEMENT
THIS AMENDED AND RESTATED CREDIT AGREEMENT ("AGREEMENT") is entered
into as of September 30, 1998, by and among RAMSAY HEALTH CARE, INC., a Delaware
corporation ("BORROWER"), the lenders from time to time party hereto (the
"LENDERS"), and GENERAL ELECTRIC CAPITAL CORPORATION, a corporation organized
under the banking laws of the State of New York, as administrative agent (in
such capacity, the "ADMINISTRATIVE AGENT").
RECITALS
A. Borrower, Lenders and the Administrative Agent are parties to a
certain Credit Agreement, dated as of September 30, 1997 (as amended by a First
Amendment to Credit Agreement dated as of March 27, 1998, a Second Amendment to
Credit Agreement dated as of May 20, 1998, a Third Amendment to Credit Agreement
dated as of June 29, 1998 and a Fourth Amendment to Credit Agreement dated as of
July 29, 1998, the "ORIGINAL CREDIT AGREEMENT"), pursuant to which Lenders
funded the Term Loans to Borrower and made the Revolving Credit Commitment (as
in effect under the Original Credit Agreement) available to Borrower.
B. On the date hereof, with the consent of the Required Lenders,
Borrower has sold certain of its assets and has utilized the Net Cash Proceeds
thereof (i) to redeem all of the issued and outstanding shares of Series 1997
Preferred Stock, as required by the provisions of Section (e)(iii) of the
Preferred Stock Designation; (ii) to repay in full the Series A Bridge Notes, as
required by Section 2.04(b) of the Original Bridge Note Purchase Agreement, and
all other amounts due to GE Capital under the Original Bridge Note Purchase
Agreement; (iii) to repay in full the Term Loans and to repay a portion of the
Revolving Credit Loan then outstanding under the Original Credit Agreement; and
(iv) to pay to GE Capital certain fees payable to GE Capital in connection with
the transactions taking place on such date.
C. Borrower, Lenders and the Administrative Agent desire to amend the
Original Credit Agreement to reflect the repayment in full of the Term Loans, to
decrease the amount of the Revolving Credit Commitment available under the
Original Credit Agreement, to change the maturity of the Revolving Credit
Commitment to September 30, 1999 and to amend the Original Credit Agreement in
certain other respects, and to restate the Original Credit Agreement, as so
amended, in its entirety, in order to remove references to the Term Loans and to
other transactions that have been completed, to set forth in a single agreement
all of the amendments to the Original Credit Agreement (including those effected
hereby), and for convenience of reference.
D. Unless otherwise defined herein, capitalized terms used herein shall
have the respective meanings ascribed to them in ANNEX A and, for the purposes
of this Agreement and the other Loan Documents, the rules of construction set
forth in ANNEX A shall govern. All Annexes, Schedules and Exhibits to this
Agreement are incorporated into this Agreement and are a part hereof.
These Recitals shall be construed as part of this Agreement.
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AGREEMENT
NOW, THEREFORE, in consideration of the premises and the mutual
covenants hereinafter contained, and intending to be legally bound, the parties
hereto amend the Original Credit Agreement and restate the Original Credit
Agreement, as so amended, as follows:
ARTICLE 1
AMOUNT AND TERMS OF CREDIT
SECTION 1.01. REVOLVING CREDIT ADVANCES.
(a) Upon and subject to the terms and conditions hereof, each
Lender severally agrees to make available to Borrower, from time to time until
the Revolving Credit Commitment Termination Date, its Pro Rata Share of
revolving credit advances (each, a "REVOLVING CREDIT ADVANCE") in an aggregate
principal amount at any time outstanding up to but not exceeding the Borrowing
Availability. The Pro Rata Share of the Revolving Credit Loan of any Lender, as
set forth opposite such Lender's name on the signature pages hereto, shall not
at any time exceed its Pro Rata Share of the Revolving Credit Commitments. No
Lender shall be responsible for the failure of any other Lender to fund its Pro
Rata Share of any Revolving Credit Advance to be made on any funding date. Each
Revolving Credit Advance shall be in an aggregate amount of $100,000 or an
integral multiple of $50,000 in excess thereof. Until the Revolving Credit
Commitment Termination Date, Borrower may from time to time borrow, repay and
reborrow Revolving Credit Advances under this SECTION 1.01.
(b) Each notice of a borrowing of a Revolving Credit Advance
shall be given in writing (by telecopy, hand delivery, or U.S. mail) by a
Responsible Financial Officer of Borrower to the Administrative Agent in the
manner provided in a written notice requesting such Revolving Credit Advance (a
"NOTICE OF REVOLVING CREDIT ADVANCE") given no later than 2:00 P.M. (New York
time) on the date which is one Business Day prior to the proposed Revolving
Credit Advance. Each such Notice of Revolving Credit Advance shall be
substantially in the form of EXHIBIT A hereto, specifying therein the requested
(i) date of such Revolving Credit Advance, (ii) amount of such Revolving Credit
Advance, (iii) Disbursement Account into which such Revolving Credit Advance
shall be made, and (iv) such other information as may reasonably be requested by
the Administrative Agent. The Administrative Agent and each Lender shall be
entitled to rely upon and shall be fully protected under this Agreement in
relying upon any Notice of Revolving Credit Advance believed by the
Administrative Agent to be genuine and to assume that the persons executing and
delivering the same were duly authorized unless the responsible individual
acting thereon for the Administrative Agent shall have actual knowledge to the
contrary.
(c) The Administrative Agent shall, promptly upon receipt of
any Notice of Revolving Credit Advance, forward a copy of such request to each
of the Lenders. Each Lender
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shall make available to the Administrative Agent the amount of such Lender's Pro
Rata Share of each Revolving Credit Advance by wire transfer to the Payment
Account, in same day funds, not later than 11:00 A.M. (New York time) on the
requested funding date. After receipt of such wire transfers (or, in the
Administrative Agent's sole discretion, before receipt of such wire transfers),
subject to the terms hereof, the Administrative Agent shall make the requested
Revolving Credit Advance to Borrower. All payments by each Lender shall be made
without setoff, counterclaim or deduction of any kind.
(d) Each Notice of Revolving Credit Advance shall be
irrevocable and binding on Borrower.
(e) The Pro Rata Share of the Revolving Credit Advances made
by each Lender shall be evidenced by a promissory note of Borrower substantially
in the form of EXHIBIT B hereto, dated the date hereof, payable to such Lender
in a principal amount equal to the amount of the Revolving Credit Commitment of
such Lender and otherwise duly completed. The date and amount of the Pro Rata
Share of each Revolving Credit Advance made by each Lender and each payment of
principal with respect thereto shall be recorded on the books and records of the
Administrative Agent, which books and records shall constitute PRIMA FACIE
evidence of the accuracy of the information therein recorded.
(f) Borrower shall furnish to the Administrative Agent a
Borrowing Base Certificate substantially in the form of Exhibit A to ANNEX F
hereto, as and when required by ANNEX F hereto, completed and signed by a
Responsible Financial Officer of Borrower, which sets forth a calculation of the
Borrowing Base as of the date set forth therein. Promptly after receipt thereof,
the Administrative Agent shall furnish a copy to each Lender. Borrower agrees
that in making any Revolving Credit Advance hereunder, each Lender shall be
entitled to rely upon the most recent Borrowing Base Certificate delivered to it
by the Administrative Agent. Borrower further agrees that if Borrower shall have
failed to deliver a Borrowing Base Certificate to the Administrative Agent
within the specified period, the Lenders shall be under no obligation to make
any further Re volving Credit Advances (or incur any additional Letter of Credit
Obligations) until such time as such Borrowing Base Certificate is delivered to
the Administrative Agent.
SECTION 1.02. PAYMENTS AND PREPAYMENTS; TERMINATION OF REVOLVING CREDIT
COMMITMENT.
(a) Borrower hereby promises to pay to the Administrative
Agent in immediately available funds, for the ratable benefit of each Lender,
the entire outstanding principal amount of the Revolving Credit Loan, and the
Revolving Credit Loan shall mature, on the Revolving Credit Commitment
Termination Date.
(b) In the event that the outstanding balance of the Revolving
Credit Loan shall at any time exceed the Borrowing Availability, Borrower shall
immediately repay the Revolving Credit Loan in the amount of such excess. If any
such excess remains after repayment in full of the
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Revolving Credit Loan, Borrower shall provide cash collateral for the Letter of
Credit Obligations in the manner specified in ANNEX B to the extent required to
eliminate such excess.
(c) Borrower shall have the right, at any time, upon thirty
(30) days' prior written notice to the Administrative Agent, to terminate or
ratably reduce the Revolving Credit Commitments, in whole or in part, without
premium or penalty; PROVIDED, HOWEVER, that (i) each such reduction of the
Revolving Credit Commitments shall be in integral multiples of $1,000,000, and
(ii) the Revolving Credit Commitments may not be reduced to less than $1,000,000
unless terminated in full. Upon any such termination of the Revolving Credit
Commitments, Borrower's right to receive Revolving Credit Advances and the
benefit of Letter of Credit Obligations shall simultaneously terminate and
Borrower's obligation to pay the Non-Use Fee shall terminate, and
notwithstanding anything to the contrary contained herein or in the Revolving
Credit Notes the entire outstanding balance of the Revolving Credit Loan shall
be immediately due and payable. On the date of any such termination, Borrower
shall pay to the Administrative Agent, for the ratable benefit of each Lender,
in immediately available funds, all of the Obligations, together with any
accrued and unpaid interest, and make arrangements in accordance with the terms
and conditions of ANNEX B with respect to any outstanding Letter of Credit
Obligations.
(d) If the unpaid principal balance of the Revolving Credit
Loan should at any time exceed the Borrowing Availability, the excess balance
shall nevertheless constitute Obligations that are secured by the Collateral and
entitled to all of the benefits hereof and of the Loan Documents and shall be
evidenced by the Revolving Credit Note.
(e) Borrower shall make the following prepayments of the
outstanding principal amount of the Revolving Credit Loan as follows:
(i) Promptly upon receipt by any Credit Party of any
cash proceeds of insurance or condemnation pursuant to SECTION 5.12
hereof, or of any asset disposition permitted by SECTION 6.08 hereof,
and in each case to the extent and within the time periods provided by
SECTION 5.13 hereof, Borrower shall prepay the Revolving Credit Loan in
an amount equal to the Net Cash Proceeds thereof;
(ii) If Borrower issues any Stock for cash after the
Effective Date (other than Stock issued (x) upon the exercise of
warrants issued and outstanding on the Original Closing Date, (y) upon
the exercise of stock options issued under any employee stock option
plan of Borrower or (z) under Borrower's 1993 Employee Stock Purchase
Plan), Borrower may retain the first $2,000,000 in Net Cash Proceeds of
such issuance and, no later than the Business Day following the date of
receipt of the proceeds thereof, Borrower shall prepay the Revolving
Credit Loan in an amount equal to 100% of any such Net Cash Proceeds in
excess of the first $2,000,000 thereof; and
(iii) If Borrower issues any debt securities for cash
or otherwise incurs any Indebtedness (other than Indebtedness
specifically permitted by SECTION 6.04 hereof), no later
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than the Business Day following the date of receipt of the proceeds
thereof, Borrower shall prepay the Revolving Credit Loan in an amount
equal to 100% of the Net Cash Proceeds of the issuance of any such debt
securities or incurrence of Indebtedness.
(f) All prepayments made pursuant to paragraph (e) of this
SECTION 1.02 shall be applied FIRST against the outstanding principal amount, if
any, of the Revolving Credit Loan, until paid in full; and SECOND, to the Cash
Collateral Account in accordance with the provisions of ANNEX B until all Letter
of Credit Obligations then outstanding are fully collateralized on the basis set
forth therein. Concurrently with any such prepayment, the Revolving Credit
Commitments shall automatically reduce by an amount equal to the amount of such
prepayment until the Revolving Credit Commitments are reduced to zero.
SECTION 1.03. USE OF PROCEEDS. Borrower shall use the proceeds of the
Revolving Credit Loan (i) for the payment of costs and expenses of the
transactions contemplated by this Agreement that are payable by Borrower, and
(ii) for Borrower's working capital and other corporate purposes not prohibited
by the terms of this Agreement and the other Loan Documents.
SECTION 1.04. LETTERS OF CREDIT. Subject to the terms and conditions of
this Agreement, Borrower shall have the right to request the issuance of Letters
of Credit, and the Lenders agree to incur Letter of Credit Obligations, in
accordance with the terms and conditions set forth in ANNEX B.
SECTION 1.05. INTEREST. Borrower shall pay interest on the Revolving
Credit Loan to the Administrative Agent for the ratable benefit of each Lender:
(i) in arrears for the preceding Fiscal Month, on each Interest Payment Date;
(ii) on the Revolving Credit Commitment Termination Date; and (iii) if any
interest accrues or remains payable after the Revolving Credit Commitment
Termination Date, upon demand. If any interest or other payment under this
Agreement becomes due and payable on a day other than a Business Day, the
maturity thereof shall be extended to the next succeeding Business Day and, with
respect to payments of principal, interest thereon shall be payable at the then
applicable rate during such extension. Interest shall accrue and be payable on
the Revolving Credit Loan at the rate or rates, and upon the terms and
conditions, set forth in ANNEX C. Each determination by the Administrative Agent
of an interest rate hereunder shall be conclusive and binding for all purposes,
absent manifest error or bad faith.
SECTION 1.06. BORROWING BASE. Based on the most recent Borrowing Base
Certificate delivered by Borrower to the Administrative Agent and on other
information available to the Administrative Agent, the Administrative Agent
shall in its reasonable credit judgment determine the amount of Reserves, if
any, in addition to those set forth in the Borrowing Base Certificate, for
purposes of determining the amounts, if any, to be advanced to Borrower under
the Revolving Credit Loan.
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SECTION 1.07. FEES.
(a) Borrower shall pay to GE Capital, individually or in its
capacity as Administrative Agent, the Fees specified in the GE Capital Fee
Letter, at the times specified for payment therein.
(b) Additionally, as compensation for the Lenders' making the
Revolving Credit Loan and the Letters of Credit available to Borrower, Borrower
agrees to pay to the Administrative Agent, for the ratable benefit of the
Lenders, in arrears, on each Interest Payment Date, the following fees:
(i) An unused facility fee (the "NON-USE FEE"), equal
to one-half of one percent (1/2 of 1%) per annum on the average unused
daily balance of the Revolving Credit Commitments; and
(ii) A letter of credit fee (the "LETTER OF CREDIT
FEE") at a rate per annum equal to two percent (2%) on the average
outstanding Letter of Credit Obligations; PROVIDED, HOWEVER, that, if
an Event of Default shall have occurred and be continuing, the
Administrative Agent may (or, upon the written request of the Required
Lenders, shall), by written notice to Borrower, increase such rate per
annum to the Default Rate, effective as of the initial date of such
Event of Default and continuing until the date on which such Event of
Default is waived or cured; PROVIDED, FURTHER, HOWEVER, that, upon the
occurrence of an Event of Default specified in SECTIONS 8.01(G), (H) or
(I), such rate per annum shall automatically increase to the Default
Rate.
(c) All Fees payable pursuant to paragraph (b) above shall be
payable in arrears for the preceding Fiscal Month, on each Interest Payment
Date. All computations of Fees calculated on a per annum basis shall be made by
the Administrative Agent on the basis of a three hundred and sixty (360) day
year, in each case for the actual number of days occurring in the period for
which such Fees are payable.
SECTION 1.08. RECEIPT OF PAYMENTS. Borrower shall make each payment
under this Agreement not later than 12:00 Noon (New York time) on the day when
due in Dollars in immediately available funds to the Payment Account. For
purposes of determining Borrowing Availability and computing interest and Fees
hereunder, all payments shall be deemed received by the Administrative Agent on
the day of receipt of immediately available funds therefor in the Payment
Account prior to 12:00 Noon (New York time). Payments received after 12:00 Noon
(New York time) on any Business Day shall be deemed to have been received on the
following Business Day.
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SECTION 1.09. FUNDING, PAYMENTS; NON-FUNDING LENDERS.
(a) AVAILABILITY OF EACH LENDER'S PRO RATA SHARE. The
Administrative Agent may assume that each Lender will make its Pro Rata Share of
each Revolving Credit Advance available to the Administrative Agent on each
funding date. If such Pro Rata Share is not, in fact, paid to the Administrative
Agent by such Lender when due, the Administrative Agent will be entitled to
recover such amount on demand from such Lender without set-off, counterclaim or
deduction of any kind. If such Lender fails to pay the amount of its Pro Rata
Share forthwith upon the Administrative Agent's demand, the Administrative Agent
shall promptly notify Borrower and Borrower shall immediately repay such amount
to the Administrative Agent. Nothing in this SECTION 1.09(A) or elsewhere in
this Agreement or the other Loan Documents shall be deemed to require the
Administrative Agent to advance funds on behalf of any Lender or to relieve any
Lender from its obligation to fulfill its Revolving Credit Commitment hereunder
or to prejudice any rights that Borrower may have against any Lender as a result
of any default by such Lender hereunder. To the extent that the Administrative
Agent advances funds to Borrower on behalf of any Lender and is not reimbursed
therefor on the same Business Day as such Revolving Credit Advance is made, the
Administrative Agent shall be entitled to retain for its account all interest
accrued on that Lender's portion of such Revolving Credit Advance until
reimbursed by the applicable Lender.
(b) PAYMENTS. Upon the receipt of any payment from Borrower
with respect to any Obligation, the Administrative Agent will advise each Lender
by telephone or telecopy of the amount of such Lender's Pro Rata Share of
principal, interest and Fees paid for the benefit of Lenders with respect to
each applicable Loan. Provided that such Lender has made all payments required
to be made by it under this Agreement and the other Loan Documents as of such
date, the Administrative Agent will pay to each Lender such Lender's Pro Rata
Share of principal, interest and Fees paid by Borrower for the benefit of that
Lender on the portion of the Revolving Credit Loan held by it. Such payments
shall be made by wire transfer to such Lender's account (as specified by such
Lender to the Administrative Agent) promptly following receipt thereof by the
Administrative Agent.
(c) RETURN OF PAYMENTS. If the Administrative Agent pays an
amount to a Lender under this Agreement in the belief or expectation that a
related payment has been or will be received by the Administrative Agent from
Borrower and such related payment is not received by the Administrative Agent,
then the Administrative Agent will be entitled to recover such amount from such
Lender on demand, without set-off, counterclaim or deduction of any kind. If the
Administrative Agent determines at any time that any amount received by the
Administrative Agent under this Agreement must be returned to Borrower or paid
to any other Person pursuant to any insolvency law or otherwise, then,
notwithstanding any other term or condition of this Agreement or any other Loan
Document, the Administrative Agent will not be required to distribute any
portion thereof to any Lender. In addition, each Lender will repay to the
Administrative Agent on demand any portion of such amount that the
Administrative Agent has distributed to such Lender, together with interest at
such rate, if any, as the Administrative Agent is required to pay to Borrower or
such other Person, without set-off, counterclaim or deduction of any kind.
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(d) NON-FUNDING LENDERS. The failure of any Lender (such
Lender, a "NON- FUNDING LENDER") to make its Pro Rata Share of any Revolving
Credit Advance on the date specified therefor shall not relieve any other Lender
(each such other Lender, an "OTHER LENDER") of its obligation to make its Pro
Rata Share of such Revolving Credit Advance, but neither any Other Lender nor
the Administrative Agent shall be responsible for the failure of any Non-Funding
Lender to make its Pro Rata Share of any Revolving Credit Advance to be made on
any funding date, and no Non-Funding Lender shall have any obligation to the
Administrative Agent or any Other Lender for the failure by such Non-Funding
Lender. Notwithstanding anything set forth herein to the contrary, a Non-Funding
Lender shall not have any voting or consent rights under or with respect to any
Loan Document or constitute a "Lender" (or be included in the calculation of
"Required Lenders" hereunder) for any voting or consent rights under or with
respect to any Loan Document.
SECTION 1.10. APPLICATION AND ALLOCATION OF PAYMENTS.
(a) So long as no Default or Event of Default shall have
occurred and be continuing, (i) payments matching specific scheduled payments
then due shall be applied to those scheduled payments; (ii) voluntary
prepayments shall be applied as determined by Borrower, subject to the
provisions of SECTION 1.02(F); and (iii) mandatory prepayments shall be applied
as set forth in SECTION 1.02(F). As to each other payment, and as to all
payments made when a Default or Event or Default shall have occurred and be
continuing or following the Revolving Credit Commitment Termination Date,
Borrower hereby irrevocably waives the right to direct the application of any
and all payments received from or on behalf of Borrower (including any proceeds
of Collateral), and Borrower and each Lender hereby irrevocably agree that the
Administrative Agent shall have the continuing exclusive right to apply any and
all such payments against the Obligations in the follow ing order: FIRST, to the
payment of any "Administrative Agent's Fee" or other fees then due and pay able
to the Administrative Agent, in its capacity as such, under the GE Capital Fee
Letter; SECOND, to the payment of all expenses incurred by the Administrative
Agent in connection with the exercise, protection and enforcement (whether
through negotiations, legal proceedings or otherwise) of this Agreement, the
Revolving Credit Notes, the Subsidiary Guaranty, or any of the other Loan
Documents; THIRD, to the payment of interest and Fees owed to each Lender,
ratably among all of the Lenders in accordance with the aggregate amount of
interest and Fees then owed to each of them; FOURTH, to the payment of the
principal amount of the Revolving Credit Notes and the Letter of Credit
Obligations then due and payable and for deposit to the Cash Collateral Account
in accordance with ANNEX B with respect to Letter of Credit Obligations not then
due and payable, ratably among all of the Lenders in accordance with the
aggregate amount of the Revolving Credit Loan and Letter of Credit Obligations
then outstanding; FIFTH, to the payment of all expenses then due and payable to
the Lenders under SECTION 11.03 hereof (other than expenses payable under item
SECOND above), ratably among each of them in accordance with the aggregate
amount of such amounts then owed to each of them; and SIXTH, to the payment of
all other Obligations of Borrower or any other Credit Party hereunder, including
any such Obligations of Borrower to any Indemnified Party entitled to
indemnification under SECTION 1.12 hereof, ratably among all of the Indemnified
Parties in accordance with the aggregate amount then owed to each of them.
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(b) The Administrative Agent is authorized to, and at its
option may, charge to the Revolving Credit Loan balance on behalf of Borrower
and cause to be paid all Fees, expenses, Charges, costs (including insurance
premiums in accordance with SECTION 5.05), principal, interest, or other
Obligations then due and payable by Borrower under this Agreement or any of the
Loan Documents, if and to the extent that Borrower fails promptly to pay any
such amounts as and when due, even if the making of such Revolving Credit
Advance causes the outstanding balance of the Revolving Credit Loan to exceed
the Borrowing Availability, in which case the terms of SECTIONS 1.02(B) and (D)
shall apply.
SECTION 1.11. LOAN ACCOUNT AND ACCOUNTING. The Administrative Agent
shall maintain a loan account (the "LOAN ACCOUNT") on its books to record: (a)
all Revolving Credit Advances and Letter of Credit Obligations, (b) all payments
made by Borrower, and (c) all other debits and credits as provided in this
Agreement with respect to the Revolving Credit Loan or any other Obligations.
All entries in the Loan Account shall be made in accordance with the
Administrative Agent's customary accounting practices as in effect from time to
time. The balance in the Loan Account, as recorded on the Administrative Agent's
most recent printout or other written statement, shall be presumptive evidence
of the amounts due and owing to the Administrative Agent and Lenders by
Borrower; PROVIDED that any failure to so record or any error in so recording
shall not limit or otherwise affect Borrower's duty to pay the Obligations. The
Administrative Agent will provide a monthly accounting of transactions under the
Revolving Credit Loan to Borrower and each Lender. Each and every such
accounting shall (absent manifest error) be deemed final, binding and conclusive
upon Borrower in all respects as to all matters reflected therein, unless
Borrower, within thirty (30) days after the date any such accounting is
rendered, shall notify the Administrative Agent in writing of any objection
which Borrower may have to any such accounting, describing the basis for such
objection with reasonable specificity. In that event, only those items (the
"DISPUTED ITEMS") expressly objected to in such notice shall be deemed to be
disputed by Borrower. The Administrative Agent's determination, based upon the
facts available, of any disputed item shall (absent manifest error) be final,
binding and conclusive on Borrower.
SECTION 1.12. INDEMNITY.
(a) Irrespective of whether any Revolving Credit Advance is
ever made hereunder or any Letter of Credit ever issued hereunder, Borrower and
each other Credit Party shall indemnify and hold the Administrative Agent, the
Syndication Agent, each Lender, each Letter of Credit Issuer, their respective
Affiliates, and their respective officers, directors, employees, attorneys and
agents (each, an "INDEMNIFIED PERSON"), harmless from and against any and all
suits, actions, costs, fines, deficiencies, penalties, proceedings, claims,
damages, losses, liabilities and expenses (including reasonable attorneys' fees
and disbursements and other costs of investigations or defense, including those
incurred upon any appeal) (each, a "CLAIM") which may be instituted or asserted
against or incurred by such Indemnified Person as the result of credit having
been extended under this Agreement or any other Loan Document or otherwise
arising in connection with the transactions contemplated hereunder and
thereunder, including any and all Environmental Liabilities and
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regardless of whether the Indemnified Person is a party to such Claim; PROVIDED,
that Borrower shall not be liable for any indemnification to such Indemnified
Person with respect to any portion of any such Claim which results solely from
such Indemnified Person's gross negligence, willful misconduct or breach of this
Agreement as determined by a final judgment of a court of competent
jurisdiction. NEITHER THE ADMINISTRATIVE AGENT, THE SYNDICATION AGENT, ANY
LENDER NOR ANY OTHER INDEMNIFIED PERSON SHALL BE RESPONSIBLE OR LIABLE TO ANY
OTHER PARTY HERETO, ANY SUCCESSOR, ASSIGNEE OR THIRD PARTY BENEFICIARY OF SUCH
PERSON OR ANY OTHER PERSON ASSERTING CLAIMS DERIVATIVELY THROUGH SUCH PARTY, FOR
INDIRECT, PUNITIVE, EXEMPLARY OR CONSEQUENTIAL DAMAGES WHICH MAY BE ALLEGED AS A
RESULT OF CREDIT HAVING BEEN EXTENDED UNDER THE LOAN DOCUMENTS OR OTHERWISE IN
CONNECTION WITH THE TRANSACTIONS CONTEMPLATED THEREBY.
(b) In addition, Borrower and each other Credit Party shall
indemnify each Lender in the manner specified in ANNEXES B and C.
SECTION 1.13. ACCESS. Borrower and each of the other Credit Parties
shall, at the expense of the Administrative Agent (unless an Event of Default
shall have occurred and be continuing and as otherwise provided in the GE
Capital Fee Letter), provide access during normal business hours to the
Administrative Agent and any of its officers, employees and agents, as
frequently as the Administrative Agent determines to be reasonably appropriate,
upon at least three Business Days' advance notice (unless a Default or Event of
Default shall have occurred and be continuing, in which event no notice shall be
required and the Administrative Agent shall have access at any and all times,
without notice), to the properties and facilities of Borrower and each of the
other Credit Parties and, while the Administrative Agent has access to such
properties and facilities, (a) permit the Administrative Agent and any of its
officers, employees and agents to inspect and make extracts from all of
Borrower's and the other Credit Parties' records, files and books of account;
and (b) permit the Administrative Agent to inspect, review, evaluate and make
test verifications of the Collateral, and Borrower and each of the other Credit
Parties shall render to the Administrative Agent, at Borrower's or such Credit
Party's reasonable cost and expense, such clerical and other assistance as may
be reasonably requested with regard thereto. Borrower and each of the other
Credit Parties shall make available to the Administrative Agent and its counsel,
as quickly as practicable under the circumstances, originals or copies of all
books, records, board minutes, contracts, insurance policies, environmental
audits, business plans, files, financial statements (actual and PRO FORMA),
filings with federal, state and local regulatory agencies, and other instruments
and documents which the Administrative Agent may request, but excluding (i) any
confidential patient medical records and (ii) confidential information relating
to a proposed Acquisition and subject to a confidentiality agreement in favor of
the seller. Borrower and each of the other Credit Parties shall deliver any
document or instrument reasonably necessary for the Administrative Agent, as it
may from time to time request, to obtain records from any service bureau or
other Person which maintains records for Borrower or the other Credit Parties.
Borrower shall instruct its independent certified public accountants and its
banking and other financial institutions to make available to the Administrative
Agent such information and records as the Administrative Agent may reasonably
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request. Representatives of other Lenders may accompany the Administrative
Agent's representatives, but Borrower shall not be charged for the costs or
expenses of the representatives of such other Lenders.
SECTION 1.14. TAXES.
(a) Any and all payments by or on behalf of Borrower hereunder
or under the Revolving Credit Notes or any other Loan Document, shall be made,
in accordance with this SECTION 1.14, free and clear of and without deduction
for any and all present or future Taxes. If Borrower shall be required by law to
deduct any Taxes from or in respect of any sum payable hereunder or under the
Revolving Credit Notes or any other Loan Document to the Administrative Agent
for distribution to any Lender or Letter of Credit Issuer, (i) the sum payable
shall be increased as may be necessary so that after making all required
deductions (including deductions applicable to additional sums payable under
this SECTION 1.14) each such Lender or Letter of Credit Issuer receives an
amount equal to the sum it would have received had no such deductions been made,
(ii) Borrower shall make such deductions, and (iii) Borrower shall pay the full
amount deducted to the relevant taxing or other authority in accordance with
applicable law.
(b) Each Credit Party shall indemnify and, within ten (10)
days after demand therefor, shall pay to the Administrative Agent, for the
benefit of such Lender or Letter of Credit Issuer, the full amount of Taxes
(including any Taxes imposed by any jurisdiction on amounts payable under this
SECTION 1.14) paid by any Lender or Letter of Credit Issuer and any liability
(including penalties, interest and expenses) arising therefrom or with respect
thereto, whether or not such Taxes were correctly or legally asserted.
(c) Within thirty (30) days after the date of any such payment
of Taxes, Borrower shall furnish to the Administrative Agent, at its address
referred to in SECTION 11.10, the original or a certified copy of a receipt
evidencing payment thereof.
(d) For the purposes of this SECTION 1.14, "TAXES" shall mean
taxes, levies, imposts, deductions, charges or withholdings, and all liabilities
with respect thereto, excluding taxes imposed on or measured by the net income
of Lenders, the Letter of Credit Issuers or any of their respective assigns
pursuant to SECTION 10.02, by the United States, the jurisdiction under the laws
of which any Lender, any Letter of Credit Issuer or any of such assigns is
organized or, in each case, any political subdivision thereof.
SECTION 1.15. CAPITAL ADEQUACY; INCREASED COSTS; ILLEGALITY.
(a) If the Administrative Agent, any Lender, or any Letter of
Credit Issuer party to this Agreement shall have determined that the adoption
after the date hereof of any law, treaty, governmental (or quasi-governmental)
rule, regulation, guideline or order regarding capital adequacy, reserve
requirements or similar requirements or compliance by any Lender or any such
Letter of Credit Issuer with any request or directive regarding capital
adequacy, reserve requirements
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or similar requirements (whether or not having the force of law) from any
central bank or other Governmental Authority increases or would have the effect
of increasing the amount of capital, reserves or other funds required to be
maintained by such Lender or Letter of Credit Issuer and thereby reducing the
rate of return on such Lender's or Letter of Credit Issuer's capital as a
consequence of its obligations hereunder, then Borrower shall from time to time
upon demand by such Lender or Letter of Credit Issuer (with a copy of such
demand to the Administrative Agent) pay to the Administrative Agent, for the
account of such Lender or Letter of Credit Issuer, additional amounts sufficient
to compensate such Lender or Letter of Credit Issuer for such reduction. A
certificate as to the amount of that reduction and showing the basis therefor
and the computation thereof submitted by such Lender or Letter of Credit Issuer
to Borrower and to the Administrative Agent shall, absent manifest error, be
final, conclusive and binding for all purposes.
(b) If, due to either (i) the introduction of or any change in
any law or regulation (or any change in the interpretation thereof) after the
date hereof or (ii) the compliance with any guideline or request from any
central bank or other Governmental Authority (whether or not having the force of
law) after the date hereof, there shall be any increase in the cost to any
Lender or to any Letter of Credit Issuer party hereto of agreeing to make or
making, funding or maintaining any Revolving Credit Loan or of agreeing to issue
or purchase a participation interest in or in issuing or purchasing a
participation interest in any Letter of Credit or Letter of Credit Obligation,
then Borrower shall from time to time, upon demand by such Lender or Letter of
Credit Issuer (with a copy of such demand to the Administrative Agent), pay to
the Administrative Agent for the account of such Lender or Letter of Credit
Issuer additional amounts sufficient to compensate such Lender or Letter of
Credit Issuer for such increased cost. A certificate as to the amount of such
increased cost, the basis therefor and the computation thereof, submitted to
Borrower and to the Administrative Agent by such Lender or Letter of Credit
Issuer, shall be conclusive and binding on Borrower for all purposes, absent
manifest error. Each Lender and Letter of Credit Issuer party hereto agrees
that, as promptly as practicable after it becomes aware of any circumstances
referred to above which would result in any such increased cost, the affected
Lender or Letter of Credit Issuer shall, to the extent not inconsistent with
such Lender's or Letter of Credit Issuer's internal policies of general
application, use reasonable commercial efforts to minimize costs and expenses
incurred by it and payable to it by Borrower pursuant to this SECTION 1.15(B).
(c) If any Lender requests compensation from Borrower under
SECTION 1.15(B), Borrower may at its option, within fifteen (15) days after
receipt by Borrower of written demand from such Lender (an "AFFECTED LENDER")
for payment of such increased costs, notify the Administrative Agent and such
Affected Lender of its intention to replace the Affected Lender. So long as no
Default or Event of Default shall have occurred and be continuing, Borrower,
with the consent of the Administrative Agent, may obtain, at Borrower's expense,
a replacement Lender ("REPLACEMENT LENDER") for the Affected Lender, which
Replacement Lender must be satisfactory to the Administrative Agent. If Borrower
obtains a Replacement Lender within ninety (90) days following notice of its
intention to do so, the Affected Lender must sell and assign its portion of the
Revolving Credit Loan and any Revolving Credit Commitment to such Replacement
Lender for an amount equal to the principal balance of the portion of the
Revolving Credit Loan held by the
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Affected Lender and all accrued interest and Fees with respect thereto through
the date of such sale, PROVIDED that Borrower shall have reimbursed such
Affected Lender for the increased costs that it is entitled to receive under
SECTION 1.15(B) through the date of such sale and assignment. Notwithstanding
the foregoing, Borrower shall not have the right to obtain a Replacement Lender
if the Affected Lender rescinds its demand for increased costs within fifteen
(15) days following its receipt of Borrower's notice of intention to replace
such Affected Lender. Furthermore, if Borrower gives a notice of intention to
replace and does not so replace such Affected Lender within ninety (90) days
thereafter, Borrower's rights under this SECTION 1.15(C) shall terminate and
Borrower shall promptly pay all increased costs demanded by such Affected Lender
pursuant to SECTION 1.15(B).
(d) Each Lender or Letter of Credit Issuer that desires
compensation under this SECTION 1.15 shall notify Borrower of any event
occurring after the date hereof entitling such Lender or Letter of Credit Issuer
to compensation under paragraph (a) or (b) of this SECTION 1.15 as promptly as
practicable, but in any event within 90 days after such Person obtains knowledge
thereof; PROVIDED that if any such Lender or Letter of Credit Issuer fails to
give such notice within 90 days after it obtains knowledge of such an event,
such Person shall, with respect to compensation payable pursuant to this SECTION
1.15 in respect of any costs resulting from such event, only be entitled to
payment under this SECTION 1.15 for costs incurred from and after the date 90
days prior to the date that such Lender or Letter of Credit Issuer does give
notice.
SECTION 1.16. SINGLE OBLIGATION. All Revolving Credit Advances to
Borrower and all of the other Obligations of Borrower and any other Credit Party
arising under this Agreement and the other Loan Documents shall constitute one
general obligation of Borrower and the other Credit Parties secured, until the
Termination Date, by all of the Collateral.
ARTICLE 2
CONDITIONS TO EFFECTIVENESS OF THIS AGREEMENT;
EFFECT OF AMENDMENT AND RESTATEMENT;
EXTENSIONS OF CREDIT ON AND AFTER EFFECTIVE DATE
SECTION 2.01. CONDITIONS TO EFFECTIVENESS OF THIS AGREEMENT. This
Agreement shall not become effective, the Original Credit Agreement shall remain
in full force and effect, Borrower shall have no rights under this Agreement and
neither Lenders nor the Administrative Agent shall be obligated to take, fulfill
or perform any action hereunder, until the following conditions have been
fulfilled to the satisfaction of the Administrative Agent:
(a) CREDIT AGREEMENT; LOAN DOCUMENTS. This Agreement or
counterparts hereof shall have been duly executed by, and delivered to,
Borrower, each other Credit Party, the Administrative Agent and Lenders; and the
Administrative Agent shall have received such documents, instruments, agreements
and legal opinions as the Administrative Agent shall reasonably request in
connection with the transactions contemplated by this Agreement and the other
Loan
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Documents, including all those listed in the Schedule of Closing Documents
attached hereto as ANNEX D, each in form and substance satisfactory to the
Administrative Agent.
(b) APPROVALS. The Administrative Agent shall have received
(i) satisfactory evidence that the Credit Parties have obtained all required
consents and approvals of all Persons including all requisite Governmental
Authorities, to the execution, delivery and performance of this Agreement and
the other Loan Documents and the consummation of the Related Transactions or
(ii) an officer's certificate in form and substance reasonably satisfactory to
the Administrative Agent affirming that no such consents or approvals are
required.
(c) PAYMENT OF FEES. Borrower shall have paid the Fees
required to be paid on the Effective Date in the respective amounts specified in
SECTION 1.07 (including the Fees specified in the GE Capital Fee Letter), and
shall have reimbursed the Administrative Agent for all reasonable legal fees and
all other out-of-pocket costs and expenses of closing presented as of the actual
date of execution of this Agreement.
(d) CONSUMMATION OF RELATED TRANSACTIONS. Each of the Related
Transaction Conditions shall have been satisfied, each of the Related
Transactions shall have been consummated, Borrower shall have received not less
than $27,200,000 in Net Cash Proceeds in respect of the Related Transactions and
Borrower shall have applied such Net Cash Proceeds (i) to the extent of
$2,739,028.25, to the redemption in full of the Series 1997 Preferred Stock as
required by Section (e)(iii) of the Preferred Stock Designation; (ii) to the
extent of $16,151,041.57 to prepay in full the Series A Bridge Notes, together
with all accrued and unpaid interest thereon as required by Section 2.04(b) of
the Original Bridge Note Purchase Agreement, and the Contingent Payment Amount
due GE Capital under Article 3 thereof; (iii) to the extent of $3,703,528.92, to
prepay in full the Term Loans, together with all accrued but unpaid interest
thereon; (iv) to the extent of the amounts then due and payable under the GE
Capital Fee Letter, to pay to GE Capital such amounts; and (v) to the extent of
the balance, to prepay a like principal amount of the Revolving Credit Loan.
(e) SERIES B BRIDGE NOTES. The holder or holders of the Series
B Bridge Notes shall have waived in writing the applicability of Section 2.04(b)
of the Original Bridge Note Purchase Agreement to the Series B Bridge Notes.
(f) BRIDGE NOTE PURCHASE AGREEMENT. The parties to the
Original Bridge Note Purchase Agreement shall have entered into the Bridge Note
Purchase Agreement, amending and restating the Original Bridge Note Purchase
Agreement to reflect the payment in full of the Series A Bridge Notes and the
Contingent Payment Amount due GE Capital under Article 3 thereof, to amend the
provisions of Article 3 thereof on a basis satisfactory to the parties thereto
and the Administrative Agent and to amend the terms and conditions thereof in
certain other respects satisfactory to the parties thereto and the
Administrative Agent.
SECTION 2.02. CONFIRMATION OF EFFECTIVENESS. Upon the fulfillment of
each of the con ditions to the effectiveness of this Agreement set forth in
SECTION 2.01, the Administrative Agent
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shall deliver to Borrower a letter confirming that the foregoing conditions have
been fulfilled (or, if any such condition precedent has been waived, stating the
terms and conditions of such waiver) and stating that this Agreement has become
effective. Upon the effectiveness of this Agreement, this Agreement shall be
effective from and after the Effective Date.
SECTION 2.03. EFFECT OF AMENDMENT AND RESTATEMENT. Upon the
effectiveness of this Agreement pursuant to SECTION 2.01, from and after the
Effective Date: (a) except as expressly set forth herein, all terms and
conditions of the Original Credit Agreement and the other Loan Documents shall
be and remain in full force and effect and shall constitute the legal, valid,
binding and enforceable obligations of Borrower to the Lenders and the
Administrative Agent; (b) the terms and conditions of the Original Credit
Agreement shall be amended as set forth herein and, as so amended, shall be
restated in their entirety, but only with respect to the rights, duties and
obligations among Borrower, the Lenders and the Administrative Agent accruing
from and after the Effective Date; (c) this Agreement shall not in any way
release or impair the rights, duties, Obligations or Liens created pursuant to
the Original Credit Agreement or any other Loan Document or affect the relative
priorities thereof, in each case to the extent in force and effect thereunder as
of the Effective Date and except as modified hereby or by documents, instruments
and agreements executed and delivered in connection herewith, and all of such
rights, duties, Obligations and Liens are assumed, ratified and affirmed by
Borrower; (d) all indemnification obligations of Borrower under the Original
Credit Agreement and any other Loan Documents shall survive the execution and
delivery of this Agreement and shall continue in full force and effect for the
benefit of the Lenders, the Administrative Agent, the Syndication Agent and any
other Person indemnified under the Original Credit Agreement or any other Loan
Document at any time prior to the Effective Date (including, without limitation,
to the extent set forth in Sections 1.14 and 9.05 of the Original Credit
Agreement as in effect immediately prior to the Effective Date); (e) the
Obligations incurred under the Original Credit Agreement shall, to the extent
outstanding on the Effective Date, continue outstanding under this Agreement and
shall not be deemed to be paid, released, discharged or otherwise satisfied by
the execution of this Agreement, and this Agreement shall not constitute a
refinancing, substitution or novation of such Obligations or any of the other
rights, duties and obligations of the parties hereunder; (f) the execution,
delivery and effectiveness of this Agreement shall not operate as a waiver of
any right, power or remedy of the Lenders or the Administrative Agent under the
Original Credit Agreement, nor constitute a waiver of any covenant, agreement or
obligation under the Original Credit Agreement, except to the extent that any
such covenant, agreement or obligation is no longer set forth herein or is
modified hereby; and (g) any and all references in the Loan Documents to the
Original Credit Agreement shall, without further action of the parties, be
deemed a reference to the Original Credit Agreement, as amended and restated by
this Agreement, and as this Agreement shall be further amended or amended and
restated from time to time hereafter.
SECTION 2.04. FURTHER CONDITIONS TO EACH REVOLVING CREDIT ADVANCE AND
LETTER OF CREDIT OBLIGATION ON AND AFTER THE EFFECTIVE DATE. Except as otherwise
expressly provided herein, no Lender shall be obligated to fund any Revolving
Credit Advance or incur any Letter of Credit Obligation on or after the
Effective Date, if, as of the date thereof:
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(a) Any representation or warranty by any Credit Party
contained herein or in any of the other Loan Documents shall be untrue or
incorrect as of such date, except to the extent that such representation or
warranty expressly relates to an earlier date and except for changes therein
expressly permitted or expressly contemplated by this Agreement; or
(b) Any Material Adverse Event shall have occurred and be
continuing since the Audit Date; or
(c) (i) Any Event of Default shall have occurred and be
continuing or would result after giving effect to any Revolving Credit Advance
(or the incurrence of any Letter of Credit Obligations), or (ii) a Default shall
have occurred and be continuing or would result after giving effect to any
Revolving Credit Advance, and the Administrative Agent or the Required Lenders
shall have determined not to make any Revolving Credit Advance or incur any
Letter of Credit Obligation so long as that Default is continuing; or
(d) After giving effect to any Revolving Credit Advance (or
the incurrence of any Letter of Credit Obligations), the outstanding principal
amount of the Revolving Credit Loan would exceed the Borrowing Availability.
The request and acceptance by Borrower of the proceeds of any Revolving Credit
Advance or the incurrence of any Letter of Credit Obligations, shall be deemed
to constitute, as of the date thereof, (i) a representation and warranty by
Borrower that the conditions in this SECTION 2.02 have been satisfied and (ii) a
reaffirmation by Borrower of the granting and continuance of the Administrative
Agent's Liens, on behalf of itself and Lenders, pursuant to the Collateral
Documents.
ARTICLE 3
REPRESENTATIONS AND WARRANTIES
To induce Lenders and the Administrative Agent to enter into this
Agreement, Borrower and each Credit Party represents and warrants to each Lender
and the Administrative Agent that:
SECTION 3.01. CORPORATE EXISTENCE; COMPLIANCE WITH LAW. Borrower and
each of its Subsidiaries: (a) is a corporation duly organized or, in the case of
certain of its Subsidiaries, a partnership or a limited liability company duly
formed; (b) is validly existing and in good standing under the laws of the
jurisdiction of its incorporation or formation; (c) is duly qualified to do
business and is in good standing in each other jurisdiction where its ownership
or lease of property or the conduct of its business requires such qualification
except where a failure to be so qualified and in good standing is not a Material
Adverse Event; (d) has the requisite corporate, partnership or limited liability
company power and authority, as the case may be, and the legal right to own,
pledge, mortgage or otherwise encumber and operate its properties, to lease the
property it operates under lease, and to conduct its business as now, heretofore
and proposed to be conducted; and (e) is in
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compliance with its articles or certificate of incorporation and bylaws, its
partnership agreement or limited liability company operating agreement, as the
case may be.
SECTION 3.02. EXECUTIVE OFFICES; COLLATERAL LOCATIONS; CORPORATE OR
OTHER NAMES. The locations of Borrower's and each of the other Credit Parties'
respective executive offices, principal places of business, corporate offices,
all premises within which any Collateral is located, and the locations of all of
Borrower's and each of the other Credit Parties' records concerning the
Collateral, in each case as of the Effective Date, are set forth in SCHEDULE
3.02. During the prior five years, except as set forth in SCHEDULE 3.02, neither
Borrower nor any of the other Credit Parties has been known as or used any
corporate, fictitious or trade name.
SECTION 3.03. CORPORATE POWER; AUTHORIZATION; ENFORCEABLE OBLIGATIONS.
The execution, delivery and performance by Borrower and each of the other Credit
Parties of this Agreement and the other Loan Documents to which it is a party
and the creation of all Liens provided for herein and therein: (a) are within
Borrower's and each such Credit Party's corporate power; (b) have been duly
authorized by all necessary corporate and shareholder action; (c) are not in
contravention of any provision of Borrower's or any such Credit Party's articles
or certificate of incorporation or bylaws or other organizational documents; (d)
do not violate any law or regulation, or any order or decree of any Governmental
Authority; (e) do not conflict with or result in the breach or termination of,
constitute a default under or accelerate any performance required by, any
indenture, mortgage, deed of trust, lease, agreement or other instrument to
which Borrower or any such Credit Party is a party or by which Borrower or any
such Credit Party or any of their respective property is bound, including,
without limitation, any agreement, document or instrument relating to
Subordinated Indebtedness; (f) do not result in the creation or imposition of
any Lien upon any of the Property of Borrower or any such Credit Party other
than those in favor of the Administrative Agent for the ratable benefit of the
Lenders, all pursuant to the Collateral Documents; and (g) do not require the
consent or approval of any Governmental Authority or any other Person, except
those consents and approvals referred to in SECTION 2.01(C), all of which will
have been duly obtained, made or complied with prior to the Effective Date and
which are in full force and effect. At or prior to the Effective Date, each of
the Loan Documents shall have been duly executed and delivered for the benefit
of or on behalf of Borrower and each of the other Credit Parties party thereto
and each shall then constitute a legal, valid and binding obligation of Borrower
and each such Credit Party, enforceable against Borrower and each such Credit
Party a party thereto in accordance with its terms except as the enforceability
of such Loan Document may be limited by bankruptcy, insolvency, reorganization,
moratorium and other laws affecting creditor's rights and remedies in general.
SECTION 3.04. FINANCIAL STATEMENTS AND PROJECTIONS. Borrower has
delivered to the Administrative Agent the Financial Statements and Projections
identified in SCHEDULE 3.04, and each of such Financial Statements and
Projections complies with the description thereof contained in SCHEDULE 3.04 as
of the Effective Date.
SECTION 3.05. MATERIAL ADVERSE EVENTS. As of the Effective Date, except
as set forth in SCHEDULE 3.05, Borrower and its Subsidiaries have no material
obligations, known material
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contingent liabilities, or material liabilities for Charges, long-term leases or
unusual forward or long-term commitments which are not reflected in the
Financial Statements identified in SCHEDULE 3.04. As of the Effective Date,
there has been no material deviation in Borrower's or any of the other Credit
Parties' financial position and results of operations from those reflected in
the Projections. As of the Effective Date, except as otherwise permitted
hereunder or as set forth in SCHEDULE 3.05, no Restricted Payment has been made
since the Audit Date, and no shares of Stock of Borrower have been, or are now
required to be, redeemed, retired, purchased or otherwise acquired for value by
Borrower or any of its Subsidiaries. Since the Audit Date, no Material Adverse
Event has occurred and is continuing.
SECTION 3.06. OWNERSHIP OF PROPERTY; LIENS. The real property listed in
SCHEDULE 3.06 constitutes all of the Real Property owned, leased, or used in
Borrower's or any of the other Credit Parties' respective businesses as of the
Effective Date. Borrower and each of the other Credit Parties holds (a) good and
insurable fee simple title to all Real Property owned by it and described in
SCHEDULE 3.06, subject only to Permitted Encumbrances of the types described in
paragraphs (a), (e) and (i) of the definition thereof, (b) valid and insurable
leasehold interests in all Leases to which it is a party and which are described
in SCHEDULE 3.06, subject only to Permitted Encumbrances of the types described
in paragraphs (a), (e) and (i) of the definition thereof, and (c) good and valid
title to, or valid leasehold interests in, all of its other properties and
assets, subject only to Permitted Liens. As of the Effective Date, none of the
properties and assets of Borrower or any of the other Credit Parties are subject
to any Liens, except Permitted Encumbrances, Liens set forth in SCHEDULE 6.07
and the Lien in favor of the Administrative Agent pursuant to the Collateral
Documents.
SECTION 3.07. RESTRICTIONS; NO DEFAULT; MATERIAL CONTRACTS. No
contract, lease, agreement or other instrument to which Borrower or any of its
Subsidiaries is a party or by which any of them or any of their respective
properties or assets is bound or affected and no provision of any charter,
corporate restriction, applicable law or governmental regulation would cause a
Material Adverse Event. Neither Borrower nor any of its Subsidiaries is in
default and, to Borrower's knowledge, no third party is in default, under or
with respect to any Material Contract, except in each case to the extent that
such default is not a Material Adverse Event. No Default or Event of Default has
occurred and is continuing. As of the Effective Date, SCHEDULES 3.07 and 3.31
set forth a complete and accurate list of all Material Contracts.
SECTION 3.08. LABOR MATTERS. Except as set forth in SCHEDULE 3.08 to
the Original Credit Agreement, as updated pursuant to ANNEX F, there are no
strikes or other labor disputes against Borrower or any of its Subsidiaries that
are pending or, to Borrower's knowledge, threatened that would be a Material
Adverse Event. Hours worked by and payment made to employees of Borrower or its
Subsidiaries have not been in violation of the Fair Labor Standards Act or any
other applicable law dealing with such matters, except where such violations are
not Material Adverse Events. All payments due from Borrower or any of its
Subsidiaries on account of employee health and welfare insurance have been paid
or accrued as a liability on the books of Borrower or such Subsidiary, except in
each case to the extent that a failure to pay or accrue such payment is not a
Material Adverse Event. Except as set forth in such SCHEDULE 3.08, as of the
Effective Date neither Borrower
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nor any of its Subsidiaries has any obligation under any collective bargaining
agreement or any agreement providing for management services to be provided to
Borrower, and a correct and complete copy of each agreement listed on such
SCHEDULE 3.08 has been provided to the Administrative Agent. Except as set forth
on such SCHEDULE 3.08, as of the Effective Date there is no organizing activity
involving Borrower or any of its Subsidiaries pending or, to Borrower's
knowledge, threatened by any labor union or group of employees. Except as set
forth in such SCHEDULE 3.08, as of the Effective Date there are no
representation proceedings pending or, to Borrower's knowledge, threatened with
the National Labor Relations Board with respect to Borrower or any of its
Subsidiaries, and no labor organization or group of employees of Borrower or any
of its Subsidiaries has made a pending demand for recognition. Except as set
forth on such SCHEDULE 3.08, there are no complaints or charges against Borrower
or any of its Subsidiaries pending or, to the knowledge of Borrower, threatened
to be filed with any federal, state, local or foreign court, governmental agency
or arbitrator based on, arising out of, in connection with, or otherwise
relating to the employment or termination of employment of any individual by
Borrower or any of its Subsidiaries, which if adversely determined would be a
Material Adverse Event.
SECTION 3.09. VENTURES, SUBSIDIARIES AND AFFILIATES; OUTSTANDING STOCK
AND INDEBTEDNESS. Except as set forth in SCHEDULE 3.09 as of the Effective Date
(a) Borrower has no Subsidiaries and is not engaged in any joint venture or
partnership with any other Person, and is not an Affiliate of any other Person;
(b) the Stock of each Subsidiary of Borrower (other than an Inactive Subsidiary)
owned by Borrower or a Subsidiary of Borrower and described in such SCHEDULE
3.09 constitutes all of the issued and outstanding Stock of each such
Subsidiary; and (c) there are no outstanding rights to purchase, options,
warrants or similar rights or agreements pursuant to which Borrower or any of
the other Credit Parties may be required to issue, sell or purchase any Stock or
other equity security of a Credit Party (other than Borrower). Such SCHEDULE
3.09 lists all outstanding Stock of each of the Credit Parties (other than
Borrower) as of the Effective Date and all Indebtedness held by any of the
Credit Parties as of the Effective Date. As of the Effective Date, all of the
Subsidiaries of Borrower that are Inactive Subsidiaries or Material Subsidiaries
are identified as such on such SCHEDULE 3.09.
SECTION 3.10. GOVERNMENT REGULATION. Neither Borrower nor any of the
other Credit Parties is: (a) an "investment company" or an "affiliated person"
of, or "promoter" or "principal underwriter" for, an "investment company," as
such terms are defined in the Investment Company Act of 1940 as amended; or (b)
subject to regulation under the Public Utility Holding Company Act of 1935, the
Federal Power Act, the Interstate Commerce Act or any other federal or state
regulatory statute that requires the approval of any Governmental Authority in
order for Borrower or any such Credit Party to incur Indebtedness, pledge its
assets, or to perform its obligations hereunder, or under any other Loan
Document.
SECTION 3.11. MARGIN REGULATIONS. Borrower is not engaged in the
business of extending credit for the purpose of purchasing or carrying Margin
Stock and no proceeds of any Revolving Credit Advance will be used to purchase
or carry any Margin Stock or to extend credit to others for the purpose of
purchasing or carrying any Margin Stock. Borrower will not take any action, or
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permit to be taken any action under its control, which might cause any Loan
Document or any document or instrument delivered pursuant hereto or thereto to
violate any regulation of the Federal Reserve Board.
SECTION 3.12. TAXES. As of the Effective Date, Borrower's and each of
the other Credit Parties' federal tax identification numbers are set forth on
SCHEDULE 3.12. All federal, and all material state, local and foreign, tax
returns, reports and statements, including information returns, required to be
filed by Borrower and its Subsidiaries, have been filed with the appropriate
Govern mental Authority and all material Charges and other impositions shown
thereon to be due and payable have been paid prior to the date on which any
fine, penalty, interest or late charge may be added thereto for nonpayment
thereof, or any such fine, penalty, interest, late charge or loss has been paid.
Proper and accurate amounts have been withheld by Borrower and each of its
Subsidiaries from its employees for all periods in compliance in all material
respects with the tax, social security and unemployment withholding provisions
of applicable federal, state, local and foreign law and such withholdings have
been timely paid to the respective Governmental Authorities. As of the Effective
Date, (i) SCHEDULE 3.12 sets forth those taxable years for which any of the tax
returns of Borrower or any of its Subsidiaries are currently being audited by
the IRS or any other applicable Governmental Authority, and any assessments or
threatened assessments in connection with such audit or otherwise currently
outstanding; (ii) except as described in SCHEDULE 3.12, neither Borrower nor any
of its Subsidiaries has executed or filed with the IRS or any other Governmental
Authority any agreement or other document extending, or having the effect of
extending, the period for assessment or collection of any Charges; (iii) neither
Borrower nor any of its Subsidiaries has agreed or been requested to make any
adjustment under IRC Section 481(a) by reason of a change in accounting method
or otherwise; and (iv) except as described in SCHEDULE 3.12, Borrower has no
obligation under any written tax sharing agreement.
SECTION 3.13. ERISA.
(a) As of the Effective Date, SCHEDULE 3.13 lists all Plans
maintained or con tributed to by Borrower and each of its Subsidiaries and all
Qualified Plans maintained or con tributed to by any ERISA Affiliate, and
separately identifies the Title IV Plans, Multi-employer Plans, any multiple
employer plans subject to Section 4064 of ERISA, unfunded Pension Plans, Welfare
Plans and Retiree Welfare Plans. IRS determination letters regarding the
qualified status under IRC Section 401 of each such Qualified Plan have been
received as of the dates listed in such SCHEDULE 3.13. Each of the favorable
determination letters considers the requirements of the Tax Reform Act of 1986,
the Omnibus Budget Reconciliation Act of 1986 and the Omnibus Budget
Reconciliation Act of 1987. To the knowledge of Borrower, the Qualified Plans as
amended continue to qualify under Section 401 of the IRC, the trusts created
thereunder continue to be exempt from tax under the provisions of IRC Section
501(a), and nothing has occurred which would cause the loss of such
qualification or tax-exempt status. Each Qualified Plan so amended has been
submitted to the IRS for a determination letter as to the ongoing qualified
status of the Plan under the IRC within the applicable IRC Section 401(b)
remedial amendment period for the Tax Reform Act of 1986; and each such Plan
shall be amended, including retroactive amendments, as required
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during such determination letter process to maintain the qualified status of
such Plans. To the knowledge of Borrower, each Plan is in compliance in all
material respects with the applicable provisions of ERISA and the IRC, including
the filing of all reports required under the IRC or ERISA which are true and
correct as of the date filed, and all required contributions and benefits have
been paid in accordance with the provisions of each such Plan. Neither Borrower,
nor any of its Subsidiaries nor any ERISA Affiliate, with respect to any
Qualified Plan, has failed to make any contribution or pay any amount due as
required by IRC Section 412 or Section 302 of ERISA. With respect to all Retiree
Welfare Plans, the present value of future anticipated expenses pursuant to
Borrower's most recent actuarial projections of liabilities does not exceed
$500,000, and copies of such projections have been provided to Lender. Borrower
has no Pension Plans, other than Qualified Plans and the unfunded Pension Plans
listed in such SCHEDULE 3.13, and Borrower has not engaged in a prohibited
transaction, as defined in IRC Section 4975 or Section 406 of ERISA, in
connection with any Plan which would subject Borrower (after giving effect to
any exemption) to a material tax on prohibited transactions imposed by IRC
Section 4975 or any other material liability.
(b) Except as set forth in such SCHEDULE 3.13: (i) no Title IV
Plan has any Unfunded Pension Liability; (ii) no ERISA Event or event described
in Section 4062(e) of ERISA with respect to any Title IV Plan has occurred or is
reasonably expected to occur; (iii) there are no pending, or to the knowledge of
Borrower, threatened claims, actions or lawsuits (other than claims for benefits
in the normal course), asserted or instituted against (x) any Plan or its
assets, (y) to Borrower's knowledge, any fiduciary with respect to any Plan or
(z) Borrower, any of its Subsidiaries or any ERISA Affiliate with respect to any
Plan; (iv) neither Borrower, nor any of its Subsidiaries nor any ERISA Affiliate
has incurred or reasonably expects to incur any Withdrawal Liability (and no
event has occurred which, with the giving of notice under Section 4219 of ERISA,
would result in such liability) under Section 4201 of ERISA as a result of a
complete or partial withdrawal from a Multi-employer Plan; (v) within the last
five (5) years neither Borrower, nor any of its Subsidiaries nor any ERISA
Affiliate has engaged in a transaction which resulted in a Title IV Plan with
Unfunded Pension Liabilities being transferred outside of the "controlled group"
(within the meaning of Section 4001(a)(14) of ERISA) of any such entity; (vi) no
Plan which is a Retiree Welfare Plan provides for continuing benefits or
coverage for any participant or any beneficiary of a participant after such
participant's termination of employment (except as may be required by IRC
Section 4980B or Part 6 of Title I of ERISA and at the sole expense of the
participant or the beneficiary of the participant); (vii) Borrower, each of its
Subsidiaries and each ERISA Affiliate have complied in all material respects
with the notice and continuation coverage requirements of IRC Section 4980B and
the proposed or final regulations thereunder; and (viii) no liability under any
Plan has been funded, nor has such obligation been satisfied with, the purchase
of a contract from an insurance company that is not rated AAA by Standard &
Poor's Rating Group and the equivalent by each other nationally recognized
rating agency.
SECTION 3.14. NO LITIGATION. Except as set forth in SCHEDULE 3.14, no
action, claim or proceeding is now pending or, to the knowledge of Borrower,
threatened against Borrower or any of its Subsidiaries, at law, in equity or
otherwise, before any court, board, commission, agency or instrumentality of any
federal, state, or local government or of any agency or subdivision thereof,
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or before any arbitrator or panel of arbitrators (a) which challenges Borrower's
or any Credit Party's right, power, or competence to enter into or perform any
of its obligations under the Loan Documents, or the validity or enforceability
of any Loan Document or any action taken thereunder, or (b) which has a
reasonable risk of being determined adversely to Borrower or any of its
Subsidiaries and which, if so determined, would be a Material Adverse Event. To
the knowledge of Borrower, as of the Effective Date there does not exist a state
of facts which is reasonably likely to give rise to such proceedings. Except as
set forth in SCHEDULE 3.14, as of the Effective Date there is no litigation
pending or, to the knowledge of Borrower, threatened against Borrower or any of
its Subsidiaries which seeks damages in excess of $500,000 or injunctive relief
or alleges criminal misconduct on the part of Borrower or any of its
Subsidiaries, and neither Borrower nor any of its Subsidiaries is a party to any
consent decree.
SECTION 3.15. BROKERS. No broker or finder acting on behalf of Borrower
or any other Credit Party brought about the obtaining, making or closing of the
credit extended pursuant to this Agreement or of the Related Transactions and
neither Borrower nor any other Credit Party has any obligation to any Person in
respect of any finder's or brokerage fees in connection therewith.
SECTION 3.16. PATENTS, TRADEMARKS, COPYRIGHTS AND LICENSES. As of the
Effective Date, Borrower and each of the other Credit Parties own or have valid
licenses for all patents, patent applications, copyrights, service marks,
trademarks, trademark applications and trade names which are necessary to
conduct its business, each of which is listed, together with United States
Patent and Trademark Office or United States Copyright Office application or
registration numbers, where applicable, in SCHEDULE 3.16 to the Original Credit
Agreement, as updated pursuant to ANNEX F. Borrower and each of its Subsidiaries
conduct business without infringement or claim of in fringement of any such
license, patent, copyright, service xxxx, trademark, trade name, trade secret or
other intellectual property right of others, except in each case to the extent
that such infringement or claim of infringement is not a Material Adverse Event.
Except as set forth in such SCHEDULE 3.16, to Borrower's knowledge, as of the
Effective Date, there is no infringement or claim of infringement by others of
any material license, patent, copyright, service xxxx, trademark, trade name,
trade secret or other intellectual property right of Borrower or any of its
Subsidiaries.
SECTION 3.17. FULL DISCLOSURE. No information contained in this
Agreement, the other Loan Documents, the Financial Statements or any written
statement, notice, report or certificate furnished by or on behalf of Borrower
or any Affiliate thereof pursuant to the terms of this Agree ment or any other
Loan Document, which has previously been delivered to the Administrative Agent
or any Lender, contains any untrue statement of a material fact or omits to
state a material fact necessary to make the statements contained herein or
therein not misleading in light of the circum stances under which they were
made. With respect to all business plans and other forecasts and projections
(including the Projections) furnished by or on behalf of Borrower and made
available to the Administrative Agent or any Lender relating to the financial
condition, operations, business, properties or prospects of Borrower and its
Subsidiaries, (i) to the knowledge of Borrower, as of the Effective Date no
facts exist concerning Borrower or any of its Subsidiaries which would result in
any material change of any of such business plans, forecasts and projections,
(ii) such business plans,
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forecasts and projections are based upon estimates and assumptions deemed
reasonable by Borrower at the time of preparation thereof, which as a whole are
fair in light of current conditions known to Borrower, have been prepared on the
basis of the assumptions stated therein, and reflect a reasonable estimate by
Borrower of the results of operations and other information projected therein.
SECTION 3.18. ENVIRONMENTAL MATTERS.
(a) Except as set forth in SCHEDULE 3.18, as of the Effective
Date: (i) the Real Property is free of contamination from any Hazardous Material
except for such contamination that would not materially adversely impact the
value or marketability of such Real Property; (ii) no Credit Party has caused or
suffered to occur any Release of Hazardous Materials on, at, in, under, above,
to, from or about any of its Real Property that would give rise to any material
liability for corrective or remedial action under any Environmental Laws except
in each case to the extent that the failure to do so would not be a Material
Adverse Event; (iii) Borrower and each of its Subsidiaries are and have been in
compliance with all Environmental Laws, except in each case to the extent that
the failure to do so would not be a Material Adverse Event; (iv) the Credit
Parties have obtained, and are in compliance with, all Environmental Permits
required by Environmental Laws for the operations of their respective
businesses, except in each case to the extent that the failure to do so would
not be a Material Adverse Event, and all such Environmental Permits are valid,
uncontested and in good standing; (v) no Credit Party is involved in operations
or knows of any facts, circumstances or conditions, including, without
limitation, any generation, use, treatment, storage, disposal, handling, other
management or Release of Hazardous Materials, that are reasonably likely to
result in any material Environmental Liabilities of such Credit Party, and, to
the knowledge of the Credit Parties, no Credit Party has permitted any current
or former tenant or occupant of the Real Property to engage in any such
operations; (vi) as of the Effective Date, there is no litigation against any
Credit Party arising under or related to any Environmental Laws, Environmental
Permits or Hazardous Material; (vii) no written notice has been received by any
Credit Party identifying it as a "potentially responsible party" or requesting
information under CERCLA or analogous state statutes in respect of any actual or
potential Environmental Liabilities and, to the knowledge of the Credit Parties,
there are no facts, circumstances or conditions that may result in any Credit
Party being identified as a "potentially responsible party" under CERCLA or
analogous state statutes; (viii) as of the Effective Date, the Credit Parties
have provided to the Administrative Agent copies of all existing environmental
reports, reviews and audits and all written information pertaining to actual or
potential Environmental Liabilities, in each case relating to any Credit Party;
and (ix) to the knowledge of the Credit Parties, the Real Property owned or
leased as of the Effective Date does not contain any underground storage tanks
that have ever leaked; are not registered with appropriate government officials
(to the extent such registration is required) or fail to meet any applicable
legal requirement, including, without limitation to, tightness-testing
requirements.
(b) Borrower has furnished to the Administrative Agent a
correct and complete copy of the Phase I Environmental Assessments for Seven
Hospital Facilities prepared by Xxxxxx Xxxxx & Associates, dated March, 1993 and
designated RBA Project No. 93455 (the "PHASE I
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ASSESSMENT") and, except with respect to Atlantic Shores Hospital, which have
previously been sold, and except as set forth on SCHEDULE 3.18, (i) Borrower is
not aware of any change since March, 1993 in respect of any of the existing and
potential environmental issues noted in the Phase I Assessment that is
reasonably likely to result in any material Environmental Liability, (ii) since
March, 1993 there has been no material construction to or demolition of any of
the hospitals the subject of the Phase I Assessment and, in any event, no
construction or demolition involving asbestos-containing materials that is
reasonably likely to result in material Environmental Liabilities, and (iii)
since March, 1993, there has been no material change in the processes or
physical operations conducted by any of the hospitals that were the subject of
the Phase I Assessment (including, without limitation, any processes or physical
operations involving the generation, use, storage, treatment, management or
other handling of Hazardous Materials) that is reasonably likely to result in
any material Environmental Liability.
SECTION 3.19. INSURANCE POLICIES. The certificate of insurance
furnished by Borrower to the Administrative Agent pursuant to paragraph 3(a) of
ANNEX D lists all insurance of any nature maintained for current occurrences by
Borrower and each of its Subsidiaries as of the Effective Date, as well as a
summary of the terms of such insurance. Such insurance complies with the
standards set forth in ANNEX E.
SECTION 3.20. DEPOSIT AND DISBURSEMENT ACCOUNTS. SCHEDULE 3.20 to the
Original Credit Agreement, as updated pursuant to ANNEX F, lists all banks and
other financial institutions at which, as of the Effective Date, any Credit
Party maintains deposit and/or other accounts and/or post office lock boxes,
including the Disbursement Accounts, and such Schedule correctly identifies the
name, address and telephone number of each depository, the name in which the
account is held, a description of the purpose of the account and the complete
account number.
SECTION 3.21. SOLVENCY. Both before and after giving effect to (a) the
entering into by the Credit Parties of this Agreement; (b) any Revolving Credit
Advances and Letter of Credit Obligations to be made or incurred on the
Effective Date or such other date as any Revolving Credit Advances and Letter of
Credit Obligations requested hereunder are made or incurred; (c) the
disbursement of the proceeds of such Revolving Credit Advances pursuant to the
instructions of Borrower; (d) the consummation of the Related Transactions; and
(e) the payment and accrual of all transaction costs in connection with the
foregoing, each Credit Party is Solvent.
SECTION 3.22. SUBORDINATION OF SUBORDINATED INDEBTEDNESS. This
Agreement, and all amendments, modifications, extensions, renewals, refinancings
and refundings hereof, constitute the "Senior Credit Agreement" within the
meaning of the Bridge Note Purchase Agreement and the Ramsay Subordinated Note
Purchase Agreement; this Agreement, together with each of the other Loan
Documents and all amendments, modifications, extensions, renewals, refinancings
and refundings hereof and thereof, constitute "Senior Credit Documents" within
the meaning of the Bridge Note Purchase Agreement and the Ramsay Subordinated
Note Purchase Agreement; and the Revolving Credit Loan, the Letter of Credit
Obligations and all other Obligations of Borrower to the Lenders and the Agents
under this Agreement, the Revolving Credit Notes and any of the other Loan
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Documents, and all amendments, modifications, extensions, renewals, refundings
or refinancings of any of the foregoing constitute "Senior Indebtedness" of
Borrower within the meaning of the Bridge Note Purchase Agreement and the Ramsay
Subordinated Note Purchase Agreement, and the holders thereof from time to time
shall be entitled to all of the rights of a holder of "Senior Indebtedness"
pursuant to Article 9 of the Bridge Note Purchase Agreement and pursuant to
Section 4 of the Ramsay Subordinated Note Purchase Agreement, respectively.
SECTION 3.23. LICENSES AND PERMITS. Borrower and each of its
Subsidiaries have all licenses, permits, consents or approvals from or by, and
have made all filings with, and has given all notices to, all Governmental
Authorities having jurisdiction, to the extent required for the ownership of its
property and the operation and conduct of its business, including, but not
limited to: (i) licenses, certifications, approvals, and accreditations as a
provider of health care services including those necessary for it to be eligible
to receive payment and compensation and to participate under Medicare, Medicaid,
and any other federal, state, local or commercial health benefit programs
pursuant to which Borrower and each of its Material Subsidiaries currently
receives reimbursement for health care items and services provided; and (ii)
licenses, certifications, approvals, and accreditations necessary to engage in
activities deemed to be the "business of insurance" and to engage in utilization
review activities under applicable State law; except in each case to the extent
that a failure to have such licenses, permits, consents, approvals, certificates
or accreditation from, to have made such filings with, or to have given such
notices to, any such Governmental Authority would not be a Material Adverse
Event with respect to Borrower or any Material Subsidiary.
SECTION 3.24. COMPLIANCE WITH LAW. Borrower and each of its
Subsidiaries is in compliance with all applicable laws relating to its business,
including, but not limited to: (i) all applicable requirements for participation
in and for the receipt of reimbursement under Medicare, Medicaid, and any other
federal, state, local or commercial health benefit program pursuant to which
Borrower and each of its Subsidiaries currently receives reimbursement for
health care items and services; (ii) all State laws relating to the "business of
insurance" and utilization review activities in any State in which Borrower and
each of its Subsidiaries engages in such business and/or activities; (iii) all
State laws relating to the provision of inpatient psychiatric services and
residential behavioral treatment programs, including, but not limited to, laws
relating to the marketing of psychiatric services, patient referral services,
involuntary admissions, patient rights, and the confidentiality of patient
medical records; except in each case to the extent that a failure to be in
compliance would not be a Material Adverse Event with respect to Borrower or any
Material Subsidiary.
SECTION 3.25. HEALTH CARE PROFESSIONALS. To the knowledge of Borrower,
all health care professionals who are employees or independent contractors of
Borrower or any of its Subsidiaries have obtained all licenses, permits,
certifications, accreditations or approvals necessary to practice the
professions in which such employees or independent contractors are engaged, and
are otherwise in compliance with all State licensing laws relating to the
practice of such professions, and, as applicable, are in compliance with all
requirements for participation in and for the receipt of reimbursement under
Medicare, Medicaid and any federal, state, local or commercial health benefit
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program pursuant to which Borrower and each of its Subsidiaries currently
receives reimbursement for health care items and services, except in each case
to the extent that a failure to obtain such licenses, permits, certifications,
accreditations or approvals, or to be in compliance with such laws and
requirements would not be a Material Adverse Event with respect to Borrower or
any Material Subsidiary.
SECTION 3.26. MANAGEMENT AGREEMENTS. None of the Management Agreements
to which Borrower or any Material Subsidiary is a party, nor any of the
transactions contemplated thereunder, violates any applicable statute, rule or
regulation (i) relating to the eligibility of a Managed Facility to receive
payment and to participate as an accredited and certified provider of health
care services under Medicare, Medicaid or any other federal, state, local or
commercial health benefit program pursuant to which such Managed Facility
currently receives reimbursement for health care items and services, or
applicable to such Managed Facility as a result of its participation in such
programs; (ii) relating to the licenses and permits required in connection
therewith; or (iii) relating to the practice of any health care profession or
the sharing of fees generated in connection therewith; except in each case to
the extent that such violation would not be a Material Adverse Event for
Borrower or such Material Subsidiary.
SECTION 3.27. PATIENT REFERRALS, ETC. Borrower and each of its
Subsidiaries, and any business arrangement with physicians, other health care
professionals, and institutional health care providers involving Borrower and
any of its Subsidiaries, are in compliance with all federal and state laws that
prohibit direct or indirect payments for patient referrals, that prohibit
referrals to an entity with which the referring provider has a financial
relationship, and that regulate procedures and practices with respect to
reimbursement, cost reports, claims for reimbursement, and billing for items and
services under Medicare, Medicaid and other federal, state, and local health
benefit programs, as well as with regard to commercial payors, including, but
not limited to, the Ethics in Patient Referrals Act of 1989, 42 U.S.C. ss.
1395nn, as amended, the Medicare and Medicaid Patient and Program Protection Act
of 1987, 42 U.S.C. ss. 1320-7b(b), as amended, and the relevant provisions of
the Health Insurance Portability and Accountability Act of 1996, except in each
case to the extent that a failure to be in compliance with such laws would not
be a Material Adverse Event with respect to Borrower or any Material Subsidiary.
SECTION 3.28. PENDING REVOCATIONS, ETC. Neither Borrower nor any of its
Subsidiaries has received notification from any Governmental Authority that any
such Governmental Authority has taken or intends to take action to revoke,
terminate, restrict or cancel any license, certificate, certification or permit
of Borrower or any of its Subsidiaries to engage in the practice of any health
care profession, to provide any health care service, to operate a health care
facility, program or service or to participate under Medicare, Medicaid or any
other federal, state, or local health benefit program, except in each case to
the extent that any such revocation, termination, restriction or cancellation,
singly or in the aggregate, would not be a Material Adverse Event with respect
to Borrower or any Material Subsidiary.
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SECTION 3.29. INVESTIGATIONS AND AUDITS. Neither Borrower nor any of
its Subsidiaries has received notice of any pending investigation by JCAHO, HCFA
or any other Governmental Authority (which investigation is not otherwise
conducted in the ordinary course of business) or of any pending criminal, civil
or administrative action, audit or investigation by a fiscal intermediary or by
or on behalf of HCFA or any other Governmental Authority (which action, audit or
investigation is of a criminal nature or is otherwise not conducted in the
ordinary course of business) and, to the knowledge of each of the Credit
Parties, no such action, audit or investigation is threatened with respect to
Borrower or any of its Subsidiaries, except in each case to the extent that any
such action, audit or investigation (i) could not reasonably be expected
materially and adversely to affect Borrower's or any Material Subsidiary's right
to receive reimbursement under, or right to participate in, Medicare, Medicaid
or any other federal, state, or local health benefit program to which such
Person would otherwise be entitled, and (ii) would not otherwise be a Material
Adverse Event with respect to Borrower or any Material Subsidiary.
SECTION 3.30. PAYMENT ADJUSTMENTS. With respect to any audit by
Medicare, Medicaid, or any other federal, state, local or commercial third party
payor pending with respect to Borrower or any of its Subsidiaries as of the
Effective Date, neither Borrower nor any of its Subsidiaries has received notice
of any requests or assertions of adjustments or claims for repayment by it of
costs and/or payments previously made to it by any third party payor and, to the
knowledge of each of the Credit Parties, as of the Effective Date none of such
audits provides for any such adjustments or claims; except in each case to the
extent that any such adjustments or claims, individually or in the aggregate,
would not be a Material Adverse Event with respect to Borrower or any Material
Subsidiary.
SECTION 3.31. CERTAIN AGREEMENTS. As of the Effective Date, Borrower
has provided to the Administrative Agent or its counsel, on behalf of the
Lenders, accurate and complete copies (or summaries) of all of the following
agreements or documents to which it is subject and each of which is listed on
SCHEDULE 3.31: (a) licenses and permits held by Borrower or any Material
Subsidiary, except in each case to the extent that the failure to hold such
license or permit would not be a Material Adverse Event with respect to Borrower
or such Material Subsidiary (including agreements, accreditations or
certifications as a provider of health care services eligible to receive payment
and compensation and to participate under Medicare, Medicaid or any other
federal, state, local or commercial health benefit program); and (b) all
Management Agreements to which it or any Material Subsidiary is or is to become
a party.
SECTION 3.32. RELATED TRANSACTIONS. As of the Effective Date, Borrower
has delivered to the Administrative Agent a complete and correct copy of each of
the material documents executed and delivered by Borrower or any of the other
Credit Parties in connection with the Related Transactions, and no Credit Party
and, to the knowledge of Borrower, no other Person party thereto is in default
in the performance or compliance with any provisions thereof. Each of the
Related Transactions has been consummated in accordance with all applicable
laws.
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ARTICLE 4
FINANCIAL STATEMENTS AND INFORMATION
SECTION 4.01. REPORTS AND NOTICES. Borrower covenants and agrees that,
from and after the Effective Date and until the Termination Date, it shall
deliver to the Administrative Agent the Financial Statements, projections,
certificates and notices at the times and in the manner set forth in ANNEX F.
Promptly after receipt thereof, the Administrative Agent shall furnish a copy of
each to each Lender.
SECTION 4.02. COMMUNICATION WITH ACCOUNTANTS. Borrower (for itself and
on behalf of each of the other Credit Parties) authorizes the Administrative
Agent, after notice to Borrower, to communicate with its and the other Credit
Parties' independent certified public accountants including Ernst & Young LLP
(which communication shall, at the option of Borrower, be conducted in the
presence of a Responsible Financial Officer), and authorizes those accountants
to disclose to the Administrative Agent any and all financial statements and
other supporting financial documents and schedules, including copies of any
management letter, with respect to the business, financial condition and other
affairs of Borrower and the other Credit Parties.
ARTICLE 5
AFFIRMATIVE COVENANTS
Borrower covenants and agrees (for itself and its Subsidiaries) that,
unless the Required Lenders and the Administrative Agent shall otherwise consent
in writing, from and after the Effective Date and until the Termination Date:
SECTION 5.01. MAINTENANCE OF EXISTENCE AND CONDUCT OF BUSINESS.
Borrower shall (and shall cause each of its Subsidiaries, other than Inactive
Subsidiaries, to): (a) except in the case of a Subsidiary that is permitted to
merge out of existence pursuant to SECTION 6.02, do or cause to be done all
things necessary to preserve and keep in full force and effect its corporate
existence and its rights and franchises; (b) continue to conduct its business
substantially as now conducted or as otherwise permitted hereunder; (c) at all
times maintain, preserve and protect all of its Intellectual Property material
to the conduct of its business, and preserve all the remainder of its Property
material to the conduct of its business, and keep the same in good repair,
working order and condition (taking into consideration ordinary wear and tear),
and (d) transact business only under the names set forth in SCHEDULE 3.02 hereto
or such other names as Borrower shall notify Administrative Agent in accordance
with the terms of Section 6(a) of the Security Agreement.
SECTION 5.02. PAYMENT OF CHARGES AND CLAIMS. Borrower shall (and shall
cause each of its Subsidiaries to) pay and discharge, or cause to be paid and
discharged in accordance with the terms thereof, (a) all Charges imposed upon it
or any such Subsidiary or its or their income and profits, or any of its
Property (real, personal or mixed), and (b) all lawful claims for labor,
materials, supplies and services or otherwise, which if unpaid by law become a
Lien on its Property; PROVIDED,
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that Borrower or any such Subsidiary shall not be required to pay any such
Charge or claim which is being contested in good faith by proper legal actions
or proceedings, so long as at the time of commencement of any such action or
proceeding and during the pendency thereof (i) no Default or Event of Default
shall have occurred and be continuing, (ii) adequate reserves with respect
thereto are established and are maintained in accordance with GAAP, (iii) such
contest operates to suspend collection of the contested Charges or claims and is
maintained and prosecuted continuously with diligence, (iv) none of the
Collateral having a value in excess of $100,000 would be subject to forfeiture
or loss by reason of the institution or prosecution of such contest, and (v)
Borrower shall promptly pay or discharge such contested Charges and all
additional charges, interest penalties and expenses, if any, and shall deliver
to Administrative Agent evidence reasonably acceptable to Administrative Agent
of such compliance, payment or discharge, if such contest is terminated or
discontinued adversely to Borrower.
SECTION 5.03. BOOKS AND RECORDS. Borrower shall (and shall cause each
of its Subsidiaries to) keep adequate records and books of account with respect
to its business activities, in which proper entries, reflecting all of its
consolidated and consolidating financial transactions, are made in accordance
with GAAP and on a basis consistent with the 1997 Audited Financial Statements.
SECTION 5.04. LITIGATION. Borrower shall notify the Administrative
Agent in writing, promptly upon learning thereof, of any litigation, suit,
administrative proceeding or other action commenced or threatened in writing
against Borrower or any Subsidiary of Borrower, which (a) in volves an amount in
excess of $1,000,000, or (b) would be a Material Adverse Event if adversely
determined.
SECTION 5.05. INSURANCE.
(a) Borrower shall, at its sole cost and expense, maintain or
cause to be maintained for itself and each of its Subsidiaries policies of
insurance in such amounts and as otherwise described in ANNEX E. In the event
Borrower at any time or times hereafter shall fail to obtain or maintain (or
fail to cause to be obtained or maintained) any of the policies of insurance
required above or to pay any premium in whole or in part relating thereto, the
Administrative Agent, without waiving or releasing any Obligations or any
Default or Event of Default hereunder, may at any time or times thereafter (but
shall not be obligated to) obtain and maintain such policies of insurance and
pay such premium and take any other action with respect thereto which the
Administrative Agent deems advisable. All sums so disbursed, including
reasonable attorneys' fees, court costs and other charges related thereto, shall
be payable, on demand, by Borrower to the Administrative Agent and shall be
additional Obligations hereunder secured by the Collateral, PROVIDED, that, if
and to the extent Borrower fails promptly to pay any of such sums upon the
Administrative Agent's demand therefor, the Administrative Agent is authorized
to, and at its option may, make or cause to be made Revolving Credit Advances on
behalf of Borrower for payment thereof.
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(b) The Administrative Agent and the Required Lenders reserve
the right at any time, upon review of Borrower's risk profile, to require
additional forms and limits of insurance adequate, in the Administrative Agent's
or the Required Lenders' reasonable opinion, to protect the interests of
Lenders, provided that the same is available on commercially reasonable terms.
Borrower shall, if so requested by the Administrative Agent or the Required
Lenders, deliver to the Administrative Agent and the Lenders, as often as the
Administrative Agent and the Required Lenders may reasonably request, a report
of a reputable insurance broker reasonably satisfactory to the Administrative
Agent or the Required Lenders with respect to the existence and scope of
coverage of its insurance policies.
(c) Borrower shall deliver to the Administrative Agent
certificates of insurance evidencing its compliance with this SECTION 5.05,
together with endorsements to all of its and its Subsidiaries' (i) "All Risk"
insurance covering the Collateral and business interruption insurance naming the
Administrative Agent as loss payee as its interest appears, for the ratable
benefit of the Lenders, and (ii) general liability and other liability policies
naming the Agents and the Lenders as additional insured.
SECTION 5.06. COMPLIANCE WITH LAWS. Borrower shall (and shall cause
each of its Subsidiaries to) comply with all federal, state and local laws,
permits and regulations applicable to it, including those relating to health
care; health care licensing, permits and accreditation; ERISA and labor matters;
and the filing of tax returns and payment of taxes (including, without
limitation, the withholding, collection, payment and deposit of employees'
income, unemployment and Social Security taxes), except in each case to the
extent that a failure to so comply with any laws, permits and regulations
relating to health care and to health care licensing, permits and accreditation
would not be a Material Adverse Event with respect to Borrower or any Material
Subsidiary, and to the extent that a failure to so comply with any other laws,
permits and regulations would not be a Material Adverse Event.
SECTION 5.07. AGREEMENTS. Borrower shall (and shall cause each of its
Subsidiaries to) perform, within all required time periods (after giving effect
to any applicable grace periods), all of its obligations and enforce all of its
rights under each agreement, contract, instrument or other document to which it
is a party, except in each case to the extent that any such failure to so
perform or enforce would not be a Material Adverse Event. Borrower shall not
(and shall not permit any of its Subsidiaries to) terminate or modify any
provision of any agreement, contract, instrument or other document to which it
is a party, except in each case to the extent that any such termination or
modification would not be a Material Adverse Event. Borrower shall (and shall
cause each of the other Credit Parties to) perform and comply with all
obligations in respect of Accounts, except in each case to the extent that any
failure so to perform or comply could materially adversely affect the
collectibility of any material portion thereof.
SECTION 5.08. ENVIRONMENTAL MATTERS. Borrower and each other Credit
Party shall, and shall cause each other Person leasing, occupying or operating
any of the Real Property (to the extent that any such other Person is within its
control) to: (a) conduct its operations and keep and maintain
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its Real Property in compliance with all Environmental Laws and Environmental
Permits, except in each case to the extent that any such noncompliance would not
be a Material Adverse Event; (b) implement any and all investigation,
remediation, removal and response actions which are reasonably appropriate or
necessary to maintain the value and marketability of the Real Property or to
comply with Environmental Laws and Environmental Permits pertaining to the
presence, generation, treatment, storage, use, disposal, transportation or
Release of any Hazardous Material on, at, in, under, above, to, from or about
any of its Real Property; (c) notify the Administrative Agent promptly after
Borrower or such Credit Party becomes aware of any violation of Environmental
Laws or Environmental Permits or any Release on, at, in, under, above, to, from
or about any Real Property which is reasonably likely to result in Environmental
Liabilities in excess of $1,000,000; and (d) promptly forward to the
Administrative Agent a copy of any order, notice, request for information or any
communication or report received by Borrower or such Credit Party in connection
with any such violation or Release or any other matter relating to any
Environmental Laws or Environmental Permits that could reasonably be expected to
result in Environmental Liabilities in excess of $1,000,000, in each case
whether or not the Environmental Protection Agency or any Governmental Authority
has taken or threatened any action in connection with any such violation,
Release or other matter. If the Administrative Agent at any time has a
reasonable basis to believe that there may be a violation of any Environmental
Laws or Environmental Permits by any Credit Party or any Environmental Liability
arising thereunder, or a Release of Hazardous Materials on, at, in, under,
above, to, from or about any of its Real Property, which, in each case, would be
a Material Adverse Event, then each Credit Party shall, upon the Administrative
Agent's written request (i) cause the performance of such environmental audits
including subsurface sampling of soil and groundwater, and preparation of such
environmental reports, at Borrower's expense, as the Administrative Agent may
from time to time request, which shall be conducted by reputable environmental
consulting firms acceptable to the Administrative Agent and shall be in form and
substance acceptable to the Administrative Agent, and (ii) permit the
Administrative Agent or its representatives to have access to all Real Property
for the purpose of conducting such environmental audits and testing as the
Administrative Agent deems appropriate, including subsurface sampling of soil
and groundwater. Borrower shall reimburse the Administrative Agent for the
reasonable costs of such audits and tests and the same will constitute a part of
the Obligations secured hereunder.
SECTION 5.09. CERTAIN OBLIGATIONS RESPECTING SUBSIDIARIES. Except with
respect to Subsidiaries that are not the surviving corporation in any merger
permitted under SECTION 6.02, Borrower shall (and shall cause each of its
Subsidiaries to) take such action from time to time as shall be necessary to
ensure that each of the other Credit Parties (excluding Gulf Coast Treatment
Center) is a direct or indirect wholly-owned Subsidiary of Borrower and that at
least ninety-six percent (96%) of the Stock of Gulf Coast Treatment Center
remains owned by Borrower or another Credit Party.
SECTION 5.10. APPLICATION OF PROCEEDS. Borrower shall use the proceeds
of Revolving Credit Advances as provided in SECTION 1.03.
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SECTION 5.11. FISCAL YEAR. Borrower shall (and shall cause each of its
Subsidiaries to) maintain as its fiscal year the twelve month accounting period
ending on June 30 of each year; PROVIDED, HOWEVER, that at any time after the
delivery to the Administrative Agent of all Financial Statements and reports to
be delivered pursuant to SECTION 4.01 and ANNEX F with respect to the Fiscal
Year ending June 30, 1998, Borrower may change its fiscal year to the twelve
month accounting period ending on December 31 of each year, and thereafter shall
maintain such fiscal year.
SECTION 5.12. CASUALTY AND CONDEMNATION.
(a) Borrower shall (and shall cause each of the other Credit
Parties to) promptly notify the Administrative Agent of any material loss,
damage or destruction to any material Collateral, whether or not covered by
insurance. Effective after the occurrence and at all times during the
continuation of an Event of Default, (i) Borrower hereby directs all present and
future insurers under its and each of its Subsidiaries' policies of insurance
covering the Collateral to pay all proceeds payable thereunder directly to the
Administrative Agent as its interest appears, for the ratable benefit of the
Lenders; and (ii) Borrower and each of the other Credit Parties irrevocably
makes, constitutes and appoints the Administrative Agent (and all officers,
employees or agents designated by the Administrative Agent) as its true and
lawful agent and attorney-in-fact for the purpose of making, settling and
adjusting claims under the policies of insurance covering the Collateral,
endorsing the name of Borrower or any of the other Credit Parties on any check,
draft, instrument or other item of payment for the proceeds of such policies of
insurance covering the Collateral, and for making all determinations and
decisions with respect to such policies of insurance covering the Collateral.
The Administrative Agent shall have no duty to exercise any rights or powers
granted to it pursuant to the foregoing power-of-attorney. If, notwithstanding
the provisions hereof which require that the Administrative Agent be the sole
loss payee, a check or other instrument from an insurer is made payable to
Borrower or any other Credit Party or to Borrower or any other Credit Party and
the Administrative Agent jointly, the Administrative Agent may endorse
Borrower's or such other Credit Party's name thereon and take such other action
as the Administrative Agent may elect to obtain the proceeds thereof.
(b) Borrower shall (and shall cause each of the other Credit
Parties to), promptly upon learning of the institution of any proceeding for the
condemnation or other taking of any material portion of its or such Credit
Party's Property, notify the Administrative Agent of the pendency of such
proceeding, and Borrower agrees that the Administrative Agent may participate in
any such proceeding and charge the expense thereof to Borrower in accordance
with SECTION 11.03, and that Borrower from time to time will deliver to the
Administrative Agent all instruments reasonably requested by the Administrative
Agent to permit such participation. After the occurrence and during the
continuation of an Event of Default, the Administrative Agent is hereby
authorized to prosecute, compromise or settle any such proceeding and to collect
any and all awards, payments or other proceeds of any such condemnation or
taking.
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(c) After deducting the expenses, if any, reasonably incurred
by the Administrative Agent in the collection or handling of any insurance or
condemnation proceeds pursuant to paragraphs (a) or (b) above, the
Administrative Agent may, at its option, either (i) apply such proceeds to the
prepayment of the Revolving Credit Loan in accordance with SECTION 1.02(E)(I)
and (F) above, or (ii) permit or require the applicable Credit Party to use such
money, or any part thereof, to replace, repair, restore or rebuild the
Collateral in a diligent and expeditious manner with materials and workmanship
of substantially the same quality as existed before the loss, damage,
destruction or condemnation. All insurance or condemnation proceeds, if any, in
excess of the amount permitted to be retained by such Credit Party and which are
otherwise to be made available to a Credit Party to replace, repair, restore or
rebuild the Collateral shall be applied by the Administrative Agent to reduce
the outstanding principal balance of the Revolving Credit Loan (which
application shall not result in a permanent reduction of the Revolving Credit
Commitments) and, upon such application, the Administrative Agent shall
establish a Reserve against the Borrowing Base in an amount equal to the amount
of such proceeds so applied. Thereafter, such funds shall be made available to
the applicable Credit Party, after the expenditure in full for such purpose of
all funds permitted to be retained by such Credit Party, to provide funds to
replace, repair, restore or rebuild the Collateral as follows: (i) Borrower
shall request a Revolving Credit Advance in the amount requested to be released;
(ii) so long as the conditions set forth in SECTION 2.02 have been met, the
Lenders shall make such Revolving Credit Advance; and (iii) the Reserve
established with respect to such proceeds shall be reduced by the amount of such
Revolving Credit Advance. To the extent not used to replace, repair, restore or
rebuild the Collateral, such proceeds shall be applied by the Administrative
Agent to the prepayment of the Revolving Credit Loan in accordance with SECTION
1.02(E)(I) and (F) above.
SECTION 5.13. APPLICATION OF CERTAIN PROCEEDS. Borrower shall apply all
Net Cash Proceeds of insurance or condemnation received by it pursuant to
SECTION 5.12 (to the extent not permitted to be retained by Borrower or another
Credit Party for the uses permitted by SECTION 5.12(C)), and all Net Cash
Proceeds of any sale or other disposition of assets permitted pursuant to
SECTION 6.08, as follows (it being understood that, to the extent that the
Administrative Agent receives any such Net Cash Proceeds that Borrower or
another Credit Party is permitted to retain pursuant to any provision of this
Agreement, it will make such Net Cash Proceeds available to Borrower or such
other Credit Party for the purposes permitted thereby):
(a) Provided that no Default or Event of Default has occurred
and is continuing, Borrower may retain the first $25,000 in the aggregate of any
Net Cash Proceeds received during any Fiscal Year under SECTION 5.12(C),
pro-rated in the case of any Fiscal Year of less than twelve full months, and
such amounts shall not be subject to the requirements of SECTION 1.02(E).
Additionally, provided that no Default or Event of Default has occurred and is
continuing, if any amount otherwise required to be remitted to the
Administrative Agent at any time under paragraphs (b), (c), (d), (e) and (g) of
this SECTION 5.13 is less than $25,000, then Borrower shall not be required to
remit such funds to the Administrative Agent for application to the prepayment
of the Revolving Credit Loan until such time as the cumulative amounts required
to be remitted thereunder equal or exceed $25,000, in which case Borrower shall
remit such cumulative amounts to the Administrative
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Agent for application to the Revolving Credit Loan, in integral multiples of
$25,000, and shall be entitled to retain any excess until the cumulative amounts
required to be remitted hereunder and not yet remitted once again equal or
exceed $25,000.
(b) Subject to the provisions of paragraph (a) above, Borrower
shall remit to the Administrative Agent or the date of receipt thereof all of
the Net Cash Proceeds of insurance or condemnation described in SECTION 5.12(C)
above that are received by Borrower or any Credit Party, but that Borrower or
such Credit Party is not entitled to retain for the purposes set forth therein,
and the Administrative Agent shall apply all of such proceeds to the prepayment
of the Revolving Credit Loan in accordance with SECTION 5.12(C) hereof.
(c) Subject to the provisions of paragraph (a) above, Borrower
shall remit to the Administrative Agent on the date of receipt thereof the Net
Cash Proceeds received upon any sale of Stock or assets permitted by SECTION
6.08(A), and the Administrative Agent shall apply all Net Cash Proceeds required
to be remitted to it pursuant to this paragraph (c) to the prepayment of the
Revolving Credit Loan in accordance with SECTION 1.02(E) and (F) hereof.
(d) Notwithstanding anything to the contrary set forth in this
Agreement, at any time while a Default or Event of Default shall have occurred
and be continuing or following the Revolving Credit Commitment Termination Date,
Borrower shall have no right to retain any proceeds of Collateral and the
Administrative Agent may apply all such proceeds in accordance with SECTION 1.10
hereof.
SECTION 5.14. ADDITIONAL MORTGAGED PROPERTIES; ADDITIONAL CREDIT
PARTIES.
(a) In the event that, subsequent to the Effective Date,
Borrower or any other Credit Party intends to acquire or lease any Real Property
that, when acquired or leased, would have a book or fair market value in excess
of $500,000, Borrower shall, or shall cause such other Credit Party to, notify
the Administrative Agent of such intent as soon as is reasonably practicable
prior to the acquisition or lease of such Real Property. At the request of the
Administrative Agent or the Required Lenders, Borrower shall, or shall cause
such other Credit Party to, execute and deliver a mortgage, leasehold mortgage
or other appropriate instrument with respect to such Real Property,
substantially identical to the Mortgages, and provide all relevant documentation
with respect thereto and take such other actions as would have been provided and
taken pursuant to paragraph 2(h) of ANNEX D to the Original Credit Agreement if
such Real Property had constituted Mortgaged Property on the Original Closing
Date. Borrower agrees that, following the taking of the actions with respect to
any Real Property required by this paragraph (a), the Administrative Agent shall
have a valid and enforceable first priority Lien on such Real Property, free and
clear of all defects and encumbrances except for Permitted Encumbrances of the
types described in paragraphs (a) and (i) of the definition thereof and others
acceptable to the Administrative Agent in its reasonable discretion. All actions
to be taken pursuant to this SECTION 5.14(A) shall be at the expense of Borrower
or the applicable Credit Party, shall be taken to the reasonable satisfaction of
the Administrative Agent, and shall be taken within thirty (30) days after the
date of closing of an Acquisition, if such Real Property is
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acquired in connection with an Acquisition consented to by the Required Lenders
and the Administrative Agent, and otherwise shall be taken within sixty (60)
days following receipt of a request from the Administrative Agent or the
Required Lenders.
(b) In the event that, subsequent to the Effective Date, any
Person becomes a Credit Party, whether pursuant to an Acquisition consented to
by the Required Lenders and the Administrative Agent or otherwise, Borrower
shall cause such Person (i) to become a party to this Agreement, the Subsidiary
Guaranty, the Security Agreement and the Stock Pledge Agreement, (ii) to provide
all relevant documentation with respect thereto and to take such other actions
as such Credit Party would have provided and taken pursuant to ANNEX D if such
Credit Party had been a Credit Party on the Original Closing Date; and (iii) if
such Credit Party owns or leases any Real Property having a book or fair market
value in excess of $500,000, to comply with paragraph (a) hereof with respect to
such Real Property. Borrower agrees that, following the delivery of any
Collateral Documents required to be executed and delivered by this SECTION
5.14(B), the Administrative Agent shall have a valid and enforceable first
priority Lien on the respective Collateral covered thereby, free and clear of
all Liens other than Permitted Liens. All actions to be taken pursuant to this
SECTION 5.14(B) shall be at the expense of Borrower or the applicable Credit
Party, shall be taken to the reasonable satisfaction of the Administrative
Agent, and shall be taken within thirty (30) days following the date such Person
becomes a Credit Party, whether pursuant to an Acquisition or otherwise.
SECTION 5.15. PERMITS, ETC. Borrower shall (and shall cause each of its
Subsidiaries, other than Inactive Subsidiaries, to) (i) obtain and maintain all
permits, licenses, certifications, accreditations, and other approvals as may be
necessary for the operation of the business of Borrower and each of its Material
Subsidiaries under applicable law, except in each case to the extent that a
failure to obtain or maintain any of such permits, licenses, certifications,
accreditations or other approvals would not be a Material Adverse Event with
respect to Borrower or any Material Subsidiary; and (ii) obtain and maintain its
qualification for participation in and the receipt of reimbursement under
Medicare, Medicaid and any other federal, state or local governmental health
benefit program or commercial health benefit program providing for payment or
reimbursement for services rendered by such Person, as applicable, except in
each case to the extent that the loss or relinquishment of such qualification
does not constitute a Material Adverse Event with respect to Borrower or any
Material Subsidiary. Borrower will promptly furnish or cause to be furnished to
the Administrative Agent copies of all reports and correspondence it or any of
its Material Subsidiaries sends or receives relating to any loss or revocation
(or threatened loss or revocation) of any permit, license, certification,
accreditation, approval or qualification required to be maintained pursuant to
this SECTION 5.15.
SECTION 5.16. FURTHER ASSURANCES. Borrower and each other Credit Party
agrees, at such Credit Party's expense and upon the reasonable request of the
Administrative Agent, to duly execute and deliver, or cause to be duly executed
and delivered, to the Administrative Agent such further instruments and do and
cause to be done such further acts as may be necessary or desirable in the
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reasonable opinion of the Administrative Agent to carry out more effectually the
provisions and purposes of this Agreement or any other Loan Document.
SECTION 5.17. RAMSAY COMMON STOCK SUBSCRIPTION AGREEMENT. Borrower
shall perform all of its obligations under the Ramsay Common Stock Subscription
Agreement and shall enforce all of the obligations of Ramsay Holdings under the
Ramsay Common Stock Subscription Agreement in accordance with their terms.
ARTICLE 6
NEGATIVE COVENANTS
Borrower covenants and agrees (for itself and its Subsidiaries) that,
unless the Required Lenders and the Administrative Agent shall otherwise consent
in writing, from and after the date hereof and until the Termination Date:
SECTION 6.01. ACQUISITIONS. Borrower will not, and will not permit any
of its Subsidiaries to, make any Acquisition.
SECTION 6.02. MERGERS, SUBSIDIARIES, INTERCOMPANY TRANSFERS, ETC.
Borrower shall not (nor permit any of its Subsidiaries to), directly or
indirectly, by operation of law or otherwise: (a) merge with, consolidate with,
or otherwise combine with, any Person, other than (i) a merger effecting an
Acquisition consented to by the Required Lenders and the Administrative Agent,
(ii) a merger or consolidation between or among any of Borrower's Subsidiaries
in which a Credit Party is the surviving entity or between or among Inactive
Subsidiaries, or (iii) a merger or consolidation between Borrower and any of its
Subsidiaries in which Borrower is the surviving entity; (b) permit any of its
Inactive Subsidiaries to acquire any material assets or conduct any material
business unless such Inactive Subsidiary concurrently becomes a Credit Party and
complies with the requirements of SECTION 5.14 hereof; (c) transfer any
Mortgaged Real Estate to any of Borrower's Subsidiaries; or (d) transfer any
assets to any of Borrower's Subsidiaries, other than (i) transfers of Stock or
assets to a Credit Party not prohibited by clause (c); or (ii) Investments
permitted by SECTION 6.03(C).
SECTION 6.03. INVESTMENTS. Borrower shall not (nor permit any of its
Subsidiaries to), directly or indirectly, make or maintain any Investment
except: (a) Cash Equivalents; (b) time deposits maturing no more than 30 days
from the date of creation thereof with a Lender or A-rated banks; (c)
Investments in Credit Parties; (d) Investments in Subsidiaries that are not
Credit Parties to the extent outstanding on the Original Closing Date and, in
the case of TCV, to the extent outstanding on the Effective Date; (e) Practice
Guarantees (evidenced by written agreements), to the extent outstanding on the
Effective Date, (f) extensions of credit to patients, evidenced by Eligible
Accounts for services rendered, made in the ordinary course of business and
consistent with past practice; and (g) other Investments outstanding on the date
hereof and listed in SCHEDULES 3.09 and 6.03.
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SECTION 6.04. INDEBTEDNESS. Borrower shall not (nor permit any of its
Subsidiaries to) create, incur, assume or permit to exist any Indebtedness,
except: (a) the Obligations; (b) Deferred Taxes; (c) Capital Lease Obligations,
Indebtedness secured by purchase money Liens permitted under SECTION 6.07(D),
and other Indebtedness incurred during any Fiscal Year, provided that the
aggregate outstanding principal amount of such Capital Lease Obligations and
other Indebtedness permitted under this clause (c) shall not exceed $250,000;
(d) unfunded pension fund and other employee benefit plan obligations and
liabilities to the extent they are permitted to remain unfunded under applicable
law; (e) Indebtedness consisting of intercompany loans and advances made by (i)
any Credit Party to any other Credit Party, or (ii) by any Subsidiary that is
not a Credit Party, to any Credit Party; (f) Guaranteed Indebtedness permitted
by SECTION 6.06; (g) the Series B Bridge Notes; and (h) the Ramsay Subordinated
Note.
SECTION 6.05. AFFILIATE AND EMPLOYEE LOANS AND TRANSACTIONS. Borrower
shall not (nor permit any of its Subsidiaries to) enter into any lending,
borrowing or other commercial transaction with or make any payments or transfers
of funds or assets (including payment of any management, consulting, advisory or
similar fee) to, or issue any shares of Borrower's Stock, or any warrant, option
or other right to acquire Shares of Borrower's Stock, or any securities
convertible into Borrower's Stock to, any of its Affiliates; PROVIDED, that (a)
Borrower may issue shares of Borrower's Stock, or any warrant, option or other
right to acquire shares of Borrower's Stock, or any security convertible into
Borrower's Stock, to any Affiliate (including, without limitation, to Ramsay
Affiliates in exchange for Series 1997-A Preferred Stock, Series B Bridge Notes
and/or the Ramsay Subordinated Note) on terms that are no less favorable to
Borrower than might be obtained in an arm's-length transaction from a Person
that is not an Affiliate of Borrower; (b) Borrower's Subsidiaries may make
Restricted Payments to the extent permitted under SECTION 6.15; (c) the Credit
Parties may pay salary and wages and provide stock options and other executive
compensation to its executive officers, to the extent approved by Borrower's
Board of Directors or the compensation committee thereof; (d) Borrower may pay
reasonable and customary directors' fees to its directors; (e) the Credit
Parties may pay reasonable legal fees and reasonable out-of-pocket expenses to
Xxxxxx & Xxxxxx for services rendered; (f) the Credit Parties may engage in
other transactions between or among Credit Parties that are specifically
permitted by SECTION 6.02; and (g) RMCI may pay the balance of the sums due to
Xxxxx X. Xxxxx and the sums due to Xxxx X. Lamella referenced in paragraph 12 of
Schedule 6.05 of the Original Credit Agreement after such time as (i) the
$2,500,000 figure included in clause (b) of the definition of Borrowing Base
shall have reduced to zero upon the application of Net Cash Proceeds of one or
more issuances of Stock by Borrower pursuant to SECTIONS 1.02(E)(II) and (F);
the $9,000,000 figure included in the definition of Revolving Credit Commitments
shall have reduced to $5,500,000 upon the application of such Net Cash Proceeds;
and (iii) no Default or Event of Default shall have occurred and be continuing.
Set forth in SCHEDULE 6.05 is a list of all such lending, borrowing or other
commercial transactions existing or outstanding as of the Effective Date.
Notwithstanding the foregoing or any other provision of this Agreement, the
Credit Parties shall not pay bonuses to Xxxx Xxxxxx, Xxxxxxxx Xxxxxx or Xxxxx X.
Xxxx until all Obligations have been paid in full.
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SECTION 6.06. GUARANTEED INDEBTEDNESS. Borrower shall not (nor permit
any of its Subsidiaries to) incur any Guaranteed Indebtedness except: (a) by
endorsement of instruments or items of payment for deposit to the general
account of Borrower or such Subsidiary; (b) Guaranteed Indebtedness incurred for
the benefit of Borrower or another Credit Party if Borrower or another Credit
Party is permitted by this Agreement to incur the primary obligation (and such
Guaranteed Indebtedness shall be treated as a primary obligation for all
purposes hereof); and (c) performance bonds or indemnities entered into in the
ordinary course of business consistent with past practices.
SECTION 6.07. LIENS. Borrower shall not (nor permit any of its
Subsidiaries to) create or permit to exist any Lien on any of its properties or
assets except for: (a) presently existing or hereafter created Liens in favor of
the Administrative Agent to secure the Obligations; (b) Liens set forth in
SCHEDULE 6.07 existing on the Effective Date; (c) Permitted Encumbrances; (d)
purchase money liens or purchase money security interests upon or in Equipment
acquired by Borrower or such Subsidiary (other than Inactive Subsidiaries) in
the ordinary course of business to secure the purchase price of such Equipment
or otherwise to secure Indebtedness or Capital Lease Obligations permitted under
SECTION 6.04(C) incurred solely for the purpose of financing the acquisition of
such Equipment, so long as such Equipment is not a component, part or accessory
installed on, or an accession, addition or attachment to, any other Equipment of
Borrower or such Subsidiary (except other Equipment on which a security interest
is permitted to exist under this clause (d)); and (e) extensions and renewals of
Liens referred to in paragraphs (b) and (d) above, provided that any such
extension or renewal Lien is limited to the property or assets covered by the
Lien extended or renewed and does not secure Indebtedness in an amount greater
than the amount of the outstanding Indebtedness secured thereby immediately
prior to such extension, renewal or replacement.
SECTION 6.08. SALE OF STOCK AND ASSETS. Borrower shall not (nor permit
any of its Subsidiaries to) sell, transfer, convey, assign or otherwise dispose
of any of its properties or other assets, including the capital Stock of any of
their respective Subsidiaries (whether in a public or a private offering or
otherwise) or any of their Accounts, other than the following:
(a) the sale of properties or assets (including Investments
but excluding the capital Stock of any of their respective Subsidiaries) having
a fair market value of not more than $250,000 in the aggregate during any Fiscal
Year, pro-rated in the case of any Fiscal Year of less than twelve full months,
PROVIDED that, as to any such sale, the fair market value of the total
consideration received by Borrower or any of its Subsidiaries in respect of each
such sale is not less than the fair market value of the asset disposed of, and
the consideration payable to Borrower or its Subsidiary in respect of each such
sale is paid in cash; and
(b) transfers of assets specifically permitted by SECTION
6.02(D) and Restricted Payments specifically permitted by SECTION 6.15;
PROVIDED, in each case, that the proceeds of any such sale or other disposition
are applied in the manner set forth in SECTION 5.13.
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All determinations of fair market value shall be made in good faith by a
Responsible Financial Officer for the purposes of paragraph (a) above. With
respect to any disposition of assets or other properties permitted pursuant to
this SECTION 6.08, the Administrative Agent shall, with reasonable promptness,
on reasonable prior written notice and upon receipt of any proceeds thereof
required by SECTION 5.13 hereof to be remitted to the Administrative Agent for
application to the Obligations, release its Lien on such assets or other
properties in order to permit the applicable Credit Party to effect such
disposition and shall execute and deliver to Borrower, at Borrower's expense,
appropriate UCC-3 termination statements and other releases as reasonably
requested by Borrower.
SECTION 6.09. MATERIAL CONTRACTS. Borrower shall not (nor permit any of
its Subsidiaries to) enter into, cancel or terminate any Material Contract or
amend or otherwise modify any Material Contract, or waive any default or breach
under any Material Contract except that Borrower and its Subsidiaries may (a)
enter into Material Contracts in the ordinary course of business, and (b) enter
into, cancel, terminate, amend or otherwise modify any Material Contract, or
waive any default or breach thereunder, (i) as specifically provided in SECTION
6.20 with respect to certain Subordinated Indebtedness, or (ii) that would not
be a Material Adverse Event.
SECTION 6.10. ERISA. Neither Borrower nor any of its Subsidiaries nor
any ERISA Affiliate shall acquire any new ERISA Affiliate that maintains or has
an obligation to contribute to a Pension Plan that has either an "accumulated
funding deficiency," as defined in Section 302 of ERISA, or any "unfunded vested
benefits," as defined in Section 4006(a)(3)(E)(iii) of ERISA in the case of any
Pension Plan other than a Multi-employer Plan and in Section 4211 of ERISA in
the case of a Multi-employer Plan if such acquisition would be a Material
Adverse Event. Additionally, neither Borrower nor any of its Subsidiaries nor
any ERISA Affiliate shall, to the extent that any of the following actions would
be a Material Adverse Event: (a) permit or suffer any condition set forth in
SCHEDULE 3.13 to cease to be met and satisfied at any time; (b) terminate any
Pension Plan that is subject to Title IV of ERISA where such termination could
reasonably be anticipated to result in liability to Borrower or such Subsidiary;
(c) permit any accumulated funding deficiency, as defined in Section 302(a)(2)
of ERISA, to be incurred with respect to any Pension Plan; fail to make any
contributions or fail to pay any amounts due and owing as required by the terms
of any Plan before such contributions or amounts become delinquent; (d) make a
complete or partial withdrawal (within the meaning of Section 4201 of ERISA)
from any Multi-employer Plan; (e) at any time fail to provide the Administrative
Agent with copies of any Plan documents or governmental reports or filings, if
requested by the Administrative Agent.
SECTION 6.11. FINANCIAL COVENANTS. Borrower shall not breach or fail to
comply with any of the financial covenants set forth in ANNEX G, each of which
shall be calculated in accordance with ANNEX G (and based upon the Financial
Statements delivered hereunder).
SECTION 6.12. HAZARDOUS MATERIALS. Borrower shall not (nor permit any
of its Subsidiaries or any other Person within the control of Borrower to): (a)
cause or permit a Release of any Hazardous Materials on, under in or about any
Real Property; (b) use, store, generate, treat or dispose of Hazardous
Materials; or (c) transport any Hazardous Materials to or from any Real
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Property; except in each case to the extent that such Release, use, storage,
generation, treatment or disposal would not (i) be a Material Adverse Event, or
(ii) materially adversely impact the value or marketability of any of the
Mortgaged Property.
SECTION 6.13. SALE-LEASEBACKS. Borrower shall not (nor permit any of
its Subsidiaries to) enter into any sale-leaseback or similar transaction
involving any of its property or assets.
SECTION 6.14. CANCELLATION OF INDEBTEDNESS. Borrower shall not (nor
permit any of its Subsidiaries to) cancel any material claim or material
Indebtedness owing to it, except for reasonable consideration and in the
ordinary course of its business.
SECTION 6.15. RESTRICTED PAYMENTS. Borrower shall not (nor permit any
of its Subsidiaries to) make any Restricted Payment to any Person, except that
(a) any Subsidiary of Borrower may pay cash dividends (or, in the case of a
Subsidiary that is a partnership or limited liability company, cash
distributions) (i) to Borrower or to another Credit Party and (ii) to any other
Person holding such Subsidiary's Stock, provided that any such dividends or
distributions are paid on a basis which is PRO RATA as to all Persons holding
such Stock (including Borrower or another Credit Party, as applicable); (b)
Borrower may effect transactions permitted by paragraph (a) of the proviso to
SECTION 6.05; (c) Borrower may make payments of interest, fees and expenses
under the Series B Bridge Notes in accordance with their terms (including,
without limitation, their subordination provisions); and (d) Borrower may make
payments of interest under the Ramsay Subordinated Note in kind for the first
twelve months after the issuance of the Ramsay Subordinated Note and thereafter
in cash in accordance with the terms of the Ramsay Subordinated Note (including,
without limitation, the subordination provisions set forth in Section 4 of the
Ramsay Subordinated Note Purchase Agreement), PROVIDED that such cash interest
payments may only be made if (i) Borrower's Fixed Charge Coverage Ratio would
not be less than 1.35:1.00 for the period beginning October 1, 1998 and ending
on the last day of each Fiscal Month thereafter, determined on a PRO FORMA basis
for the most recent period for which Borrower is required to deliver a
Compliance Certificate to the Administrative Agent pursuant to ANNEX F hereof,
based on Borrower's actual Fixed Charge Coverage Ratio as set forth therein, but
calculated as if such interest was included in Fixed Charges for such period for
the purpose of such computation, (ii) Borrower would be in compliance with the
financial covenant set forth in Section 1(b) (Interest Coverage Ratio) of ANNEX
G, determined on a PRO FORMA basis for the most recent period for which Borrower
is required to deliver a Compliance Certificate to the Administrative Agent
pursuant to ANNEX F hereof, based on Borrower's actual Interest Coverage Ratio
as set forth therein, but calculated as if interest on the Ramsay Subordinated
Note was included in Interest Expense for such period for the purpose of such
computation; (iii) the Series B Bridge Notes and all amounts owed by Borrower to
the holders of the Series B Bridge Notes under the Bridge Note Purchase
Agreement have been paid in full, and (iv) no Default or Event of Default exists
or would be caused by such payment.
SECTION 6.16. NO SPECULATIVE TRANSACTIONS. Borrower shall not (nor
permit any of its Subsidiaries to) engage in any transaction involving commodity
options or futures contracts or other,
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similar, speculative matters (other than in the ordinary course of business
consistent with past practice and interest rate swap, cap or collar agreements
relating to the Revolving Credit Loan).
SECTION 6.17. MARGIN REGULATIONS. Borrower shall not use the proceeds
of or any Revolving Credit Advance to purchase or carry any Margin Stock or any
equity security of a class which is registered pursuant to Section 12 of the
Securities Exchange Act of 1934.
SECTION 6.18. LIMITATION ON NEGATIVE PLEDGE CLAUSES, ETC. Borrower
shall not (nor permit any of its Subsidiaries to), directly or indirectly, enter
into any agreement with any Person which directly or indirectly (a) prohibits or
limits the ability of Borrower or any other Credit Party to create, incur,
assume or suffer to exist any Lien upon any of its Property, assets or revenues
in favor of the Administrative Agent for the benefit of Lenders, whether now
owned or hereafter acquired; or (b) restricts, prohibits or requires the consent
of any Person with respect to the payment of dividends or distributions or the
making or repayment of intercompany loans by a Subsidiary of Borrower to
Borrower.
SECTION 6.19. ACCOUNTING CHANGES. Borrower shall not make any
significant change in accounting treatment and reporting practices except for
changes concurred in by Borrower's independent public accountants.
SECTION 6.20. CHANGES RELATING TO SUBORDINATED DEBT. Neither Borrower
nor any other Credit Party shall change or amend the terms of the Series B
Bridge Notes, the Ramsay Subordinated Note, the Bridge Note Purchase Agreement,
the Ramsay Subordinated Note Purchase Agreement or any other Subordinated
Indebtedness (or any indenture or agreement in connection therewith) if the
effect of such amendment is to: (a) increase the interest rate on such
Subordinated Indebtedness; (b) change the dates upon which payments of principal
or interest are due on such Subordinated Indebtedness other than to extend such
dates; (c) change any default or event of default other than to delete or make
less restrictive any default provision therein; (d) change or add any covenant
with respect to such Subordinated Indebtedness other than to make less
restrictive any such covenant; (d) change the redemption or prepayment
provisions of such Subordinated Indebtedness other than to extend the dates
therefor or to reduce the premiums payable in connection therewith; (e) grant
any security or collateral to secure payment of such Subordinated Indebtedness;
or (f) change or amend any other term if such change or amendment would
materially increase the obligations of the obligor or confer additional material
rights to the holder of such Subordinated Indebtedness in a manner adverse to
any Credit Party, the Administrative Agent or any Lender.
SECTION 6.21. LEASES. Neither Borrower nor any other Credit Party shall
lease any of the Mortgaged Property to any third party, other than (a) leases in
existence on the Original Closing Date and reflected in the title insurance
policy in respect thereof furnished to the Administrative Agent pursuant to
ANNEX D to the Original Credit Agreement, and (b) other leases entered into
after the Original Closing Date, provided that the space leased under all such
leases with respect to any Mortgaged Property does not exceed 10% of the total
square footage of the building to which such lease applies.
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SECTION 6.22. TAX SHARING AGREEMENTS. Neither Borrower nor any other
Credit Party shall enter into any tax sharing agreement with any Person not
included in Borrower's Financial Statements.
ARTICLE 7
TERM
SECTION 7.01. DURATION. The financing arrangements contemplated hereby
shall be in effect until the Revolving Credit Commitment Termination Date. On
the Revolving Credit Commitment Termination Date, the Revolving Credit
Commitments shall terminate and the Revolving Credit Loan and all other
Obligations shall immediately become due and payable in full, in cash.
SECTION 7.02. SURVIVAL OF OBLIGATIONS. Except as otherwise expressly
provided for in the Loan Documents, no termination or cancellation (regardless
of cause or procedure) of any financing arrangement under this Agreement shall
in any way affect or impair the Obligations, duties, indemnities and liabilities
of Borrower or any other Credit Party, or the rights of the Agents or Lenders
relating to any Obligations, due or not due, liquidated, contingent or
unliquidated or any transaction or event occurring prior to such termination, or
any transaction or event, the performance of which is not required until after
the Revolving Credit Commitment Termination Date. Except as otherwise expressly
provided herein or in any other Loan Document, all undertakings, agreements,
covenants, warranties and representations of or binding upon Borrower or any
other Credit Party, and all rights of the Agents and Lenders, all as contained
in the Loan Documents, shall not terminate or expire, but rather shall survive
such termination or cancellation and shall continue in full force and effect
until such time as all of the Obligations have been indefeasibly paid in full in
accordance with the terms of the agreements creating such Obligations.
ARTICLE 8
EVENTS OF DEFAULT; RIGHTS AND REMEDIES
SECTION 8.01. EVENTS OF DEFAULT. The occurrence of any one or more of
the following events (regardless of the reason therefor) shall constitute an
"EVENT OF DEFAULT" hereunder:
(a) Borrower (i) fails to make any payment or prepayment of
principal of the Revolving Credit Loan or any of the other Obligations when due
and payable, (ii) fails to make any payment of interest on, or Fees owing in
respect of, the Revolving Credit Loan or any of the other Obligations when due
and payable and such failure shall remain unremedied for more than three (3)
Business Days, or (iii) fails to pay or reimburse the Administrative Agent or
Lenders for any expense reimbursable hereunder or under any other Loan Document
within ten (10) Business Days following the Administrative Agent's demand for
such reimbursement or payment of expenses.
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(b) Any Credit Party shall fail or neglect to perform, keep or
observe any of the provisions of SECTIONS 1.03, 1.13, 5.05, 5.10, 5.11, 5.13 or
5.14, of ARTICLE 6, or of any of the provisions set forth in ANNEX G.
(c) Borrower shall fail or neglect to perform, keep or observe
any of the provisions of ARTICLE 4 or any provisions set forth in ANNEX F and
the same shall remain unremedied for one (1) Business Day or more after receipt
of written notice thereof from the Administrative Agent or any Lender.
(d) Any Credit Party shall fail or neglect to perform, keep or
observe any other provision of this Agreement or of any of the other Loan
Documents (other than any provision embodied in or covered by any other clause
of this SECTION 8.01) and the same shall remain unremedied for thirty (30) days
or more after the earlier of (i) receipt of written notice thereof from the
Administrative Agent or any Lender and (ii) the date any Credit Party knows of
such failure or neglect.
(e) A default or breach shall occur under any other agreement,
document or instrument to which any Credit Party is a party which is not cured
within any applicable grace period, and such default or breach (i) involves the
failure to make any payment when due in respect of any Indebtedness (other than
the Obligations) of any Credit Party in excess of $100,000 in the aggregate, or
(ii) causes, or permits any holder of such Indebtedness or a trustee to cause,
Indebtedness or a portion thereof in excess of $100,000 in the aggregate to
become due prior to its stated maturity or prior to its regularly scheduled
dates of payment, regardless of whether such default is waived, or such right is
exercised, by such holder or trustee.
(f) Any information contained in any Borrowing Base
Certificate is untrue or incorrect in any material respect as of the date made,
or any representation or warranty herein or in any Loan Document or in any
written statement, report, financial statement or certificate (other than a
Borrowing Base Certificate) made or delivered to the Administrative Agent or any
Lender by any Credit Party is untrue or incorrect in any material respect as of
the date when made or deemed made.
(g) Assets of any Credit Party with a fair market value of
$100,000 or more shall be attached, seized, levied upon or subjected to a writ
or distress warrant, or come within the possession of any receiver, trustee,
custodian or assignee for the benefit of creditors of any Credit Party and such
condition continues for thirty (30) days or more.
(h) A case or proceeding shall have been commenced against any
Credit Party seeking a decree or order in respect of any Credit Party (i) under
Title 11 of the United States Code, as now constituted or hereafter amended or
any other applicable federal, state or foreign bankruptcy or other similar law,
(ii) appointing a custodian, receiver, liquidator, assignee, trustee or
sequestrator (or similar official) for any Credit Party or of any substantial
part of any such
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Credit Party's assets, or (iii) ordering the winding-up or liquidation of the
affairs of any Credit Party, and such case or proceeding shall remain
undismissed or unstayed for sixty (60) days or more or such court shall enter a
decree or order granting the relief sought in such case or proceeding.
(i) Any Credit Party (i) shall file a petition seeking relief
under Title 11 of the United States Code, as now constituted or hereafter
amended, or any other applicable federal, state or foreign bankruptcy or other
similar law, (ii) shall fail to contest in a timely and appropriate manner or
shall consent to the institution of proceedings thereunder or to the filing of
any such petition or to the appointment of or taking possession by a custodian,
receiver, liquidator, assignee, trustee or sequestrator (or similar official) of
any Credit Party or of any substantial part of any such Credit Party's assets,
(iii) shall make an assignment for the benefit of creditors, or (iv) shall take
any corporate action in furtherance of any of the foregoing, or (v) shall admit
in writing its inability to, or shall be generally unable to, pay its debts as
such debts become due.
(j) A final judgment or judgments for the payment of money in
excess of $300,000 in the aggregate at any time outstanding shall be rendered
against any Credit Party unless such judgment or judgments shall, within thirty
(30) days after the entry thereof, have been discharged or execution thereof
stayed or bonded pending appeal, or shall have been discharged prior to the
expiration of any such stay.
(k) Any material provision of any Loan Document shall for any
reason cease to be valid, binding and enforceable in accordance with its terms
(or any Credit Party shall challenge the enforceability of any Loan Document or
shall assert in writing, or engage in any action or inaction based on any such
assertion, that any provision of any of the Loan Documents has ceased to be or
otherwise is not valid, binding and enforceable in accordance with its terms),
or any security interest created under any Loan Document shall cease to be a
valid and perfected first priority security interest or Lien (except as
otherwise permitted herein or therein) in any material amount of the Collateral
purported to be covered thereby.
(l) Any Change of Control shall occur; or, except as the
result of any disposition specifically permitted or consented to hereunder,
Borrower or any other Credit Party shall fail at any time to be the record and
beneficial owner of 100% of the issued and outstanding capital Stock of any of
its Subsidiaries (other than Gulf Coast Treatment Center) that are Credit
Parties as of the Effective Date or that become Credit Parties subsequent to the
Effective Date, or shall fail at any time to be the record and beneficial owner
of not less than 96% of the issued and outstanding capital Stock of Gulf Coast
Treatment Center, in each case free and clear of any Lien other than inchoate
tax Liens and Liens in favor of the Administrative Agent for the benefit of the
Lenders.
(m) Any Material Adverse Event occurs and is continuing.
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(n) Borrower or any of the Ramsay Affiliates shall fail to
perform their respective obligations under the Ramsay Common Stock Subscription
Agreement, as and when such performance is due.
(o) Borrower or any of its Subsidiaries make cash payments in
an aggregate amount exceeding $750,000 for which the offsetting entry on
Borrower's Financial Statements is a debit to a litigation or malpractice claim
reserve reflected in the 1997 Audited Financial Statements or in a litigation or
malpractice claim reserve reflected in unaudited Financial Statements of the
Borrower for the Fiscal Quarter ending March 31, 1998, rather than an expense or
reduction of revenues on Borrower's income statement; PROVIDED, HOWEVER, that
the $750,000 figure above shall increase to $1,000,000 after such time as (i)
the $2,500,000 figure included in clause (b) of the definition of Borrowing Base
shall have reduced to zero upon the application of Net Cash Proceeds of one or
more issuances of Stock by Borrower pursuant to SECTIONS 1.02(E)(II) and (F);
the $9,000,000 figure included in the definition of Revolving Credit Commitments
shall have reduced to $5,500,000 upon the application of such Net Cash Proceeds;
and (iii) no Default or Event of Default shall have occurred and be continuing.
SECTION 8.02. REMEDIES.
(a) If any Event of Default shall have occurred and be
continuing, the provisions of SECTION 1.07 (B)(II) and paragraph 1(c) of ANNEX C
with respect to the Default Rate shall apply.
(b) If any Event of Default shall have occurred and be
continuing, or if a Default shall have occurred and be continuing and the
Administrative Agent or the Required Lenders shall have determined not to make
any Revolving Credit Advances or incur any Letter of Credit Obligations so long
as that specific Default is continuing, the Administrative Agent may, or at the
written direction of the Required Lenders shall, without notice, suspend the
Revolving Credit Commitments with respect to further Revolving Credit Advances
and/or the incurrence of further Letter of Credit Obligations whereupon any
further Revolving Credit Advances or Letter of Credit Obligations shall be made
or incurred in the Administrative Agent's sole discretion (or in the sole
discretion of the Required Lenders, if such suspension occurred at their
direction) so long as such Event of Default is continuing.
(c) If any Event of Default shall have occurred and be
continuing, the Administrative Agent may (and at the direction of the Required
Lenders shall), without notice, take any one or more of the following actions:
(i) terminate the Revolving Credit Commitments, whereupon the Lenders'
obligation to make further Revolving Credit Advances or to incur further Letter
of Credit Obligations shall terminate; (ii) declare all or any portion of the
Obligations to be forthwith due and payable, including the Revolving Credit Loan
and any contingent liabilities with respect to Letter of Credit Obligations,
whereupon such Obligations shall become and be due and payable; (iii) require
that all Letter of Credit Obligations be fully cash collateralized in accordance
with the terms of ANNEX B; or (iv) exercise any rights and remedies provided to
the Administrative Agent or any Lender under the Loan Documents and/or at law or
equity, including all remedies
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provided under the Code; PROVIDED, HOWEVER, that upon the occurrence of an Event
of Default specified in SECTION 8.01(G), (H) or (I), the Revolving Credit
Commitments shall immediately terminate and the Obligations shall become
immediately due and payable, in each case, without declaration, notice or demand
by or to any Person.
(d) Anything in this Agreement to the contrary
notwithstanding, each Lender hereby agrees with each other Lender that no Lender
shall take any action to protect or enforce its rights arising out of this
Agreement, the Revolving Credit Notes or the other Loan Documents (including
exercising any rights of set-off) without first obtaining the prior written
consent of the Administrative Agent and the Required Lenders, it being the
intent of Lenders that any such action to protect or enforce rights under this
Agreement and the Revolving Credit Notes shall be taken in concert and at the
direction or with the consent of the Administrative Agent and the Required
Lenders.
SECTION 8.03. WAIVERS BY CREDIT PARTIES. Except as otherwise provided
for in this Agreement and the other Loan Documents, to the full extent permitted
by applicable law, Borrower and each other Credit Party waives (a) presentment,
demand and protest and notice of presentment, dishonor, notice of intent to
accelerate, notice of acceleration, protest, default, nonpayment, maturity,
release, compromise, settlement, extension or renewal of any or all Loan
Documents, notes, commercial paper, accounts, contract rights, documents,
instruments, chattel paper and guaranties at any time held by the Administrative
Agent on which Borrower or any other Credit Party may in any way be liable, and
Borrower and each other Credit Party hereby ratifies and confirms whatever the
Administrative Agent may do in this regard, (b) all rights to notice and a
hearing prior to the Administrative Agent's taking possession or control of, or
to the Administrative Agent's replevy, attachment or levy upon, the Collateral
or any bond or security which might be required by any court prior to allowing
the Administrative Agent to exercise any of their remedies, and (c) the benefit
of any right of redemption and all valuation, appraisal and exemption laws.
Borrower and each other Credit Party acknowledges that it has been advised by
counsel of its choice with respect to this Agreement, the other Loan Documents
and the transactions contemplated by this Agreement and the other Loan
Documents.
ARTICLE 9
THE ADMINISTRATIVE AGENT
SECTION 9.01. APPOINTMENT OF THE ADMINISTRATIVE AGENT.
(a) GE Capital is hereby appointed to act on behalf of all
Lenders as the Administrative Agent under this Agreement and the other Loan
Documents. The provisions of this ARTICLE 9 are solely for the benefit of the
Administrative Agent and Lenders, and neither Borrower, the Credit Parties nor
any other Person shall have any rights directly or as a third party beneficiary
of any of the provisions hereof, except (i) Borrower's right to approve any
successor Administrative Agent in accordance with SECTION 9.06 and (ii)
Borrower's right to have Collateral released in
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accordance with SECTION 9.08. In performing its functions and duties under this
Agreement and the other Loan Documents, the Administrative Agent shall act
solely as an agent of Lenders and does not assume and shall not be deemed to
have assumed any obligation toward or relationship of agency or trust with or
for Borrower, any other Credit Party or any other Person. The Administrative
Agent shall have no duties or responsibilities except for those expressly set
forth in this Agreement and the other Loan Documents. The duties of the
Administrative Agent shall be mechanical and administrative in nature and the
Administrative Agent shall not have, or be deemed to have, by reason of this
Agreement, any other Loan Document or otherwise, a fiduciary relationship in
respect of any Lender. Neither the Administrative Agent nor any of its
Affiliates nor any of their respective officers, directors, employees, agents or
representatives shall be liable to any Lender for any action taken or omitted to
be taken by it hereunder or under any other Loan Document, or in connection
herewith or therewith, except for damages solely caused by its or their own
gross negligence or willful misconduct as finally determined by a court of
competent jurisdiction.
(b) If the Administrative Agent shall request instructions
from the Required Lenders or all affected Lenders with respect to any act or
action (including failure to act) in connection with this Agreement or any other
Loan Document, then the Administrative Agent shall be entitled to refrain from
such act or taking such action unless and until the Administrative Agent shall
have received instructions from the Required Lenders or all affected Lenders, as
the case may be, and the Administrative Agent shall not incur liability to any
Person by reason of so refraining. The Administrative Agent shall be fully
justified in failing or refusing to take any action hereunder or under any other
Loan Document (i) if such action would, in the opinion of the Administrative
Agent, be contrary to law or the terms of this Agreement or any other Loan
Document, (ii) if such action would, in the opinion of the Administrative Agent,
expose the Administrative Agent to Environmental Liabilities or (iii) if the
Administrative Agent shall not first be indemnified to its satisfaction against
any and all liability and expense which may be incurred by it by reason of
taking or continuing to take any such action. Without limiting the foregoing, no
Lender shall have any right of action whatsoever against the Administrative
Agent as a result of the Administrative Agent's acting or refraining from acting
hereunder or under any other Loan Documents in accordance with the instructions
of the Required Lenders or all affected Lenders, as applicable.
SECTION 9.02. THE ADMINISTRATIVE AGENT'S RELIANCE, ETC. Neither the
Administrative Agent nor any of its Affiliates nor any of their respective
directors, officers, agents or employees shall be liable for any action taken or
omitted to be taken by it or them under or in connection with this Agreement or
the other Loan Documents, except for damages solely caused by its or their own
gross negligence or willful misconduct as finally determined by a court of
competent jurisdiction. Without limitation of the generality of the foregoing,
the Administrative Agent: (a) may treat the payee of any Revolving Credit Note
as the holder thereof until the Administrative Agent receives written notice of
the assignment or transfer thereof signed by such payee and in form satisfactory
to the Administrative Agent; (b) may consult with legal counsel, independent
public accountants and other experts selected by it and shall not be liable for
any action taken or omitted to be taken in good faith by it in accordance with
the advice of such counsel, accountants or experts; (c) makes no warranty or
representation to any Lender and shall not be responsible to any Lender for any
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statements, warranties or representations made in or in connection with this
Agreement or the other Loan Documents; (d) shall not have any duty to ascertain
or to inquire as to the performance or observance of any of the terms, covenants
or conditions of this Agreement or the other Loan Documents on the part of any
Credit Party or to inspect the Collateral (including the books and records) of
any Credit Party; (e) shall not be responsible to any Lender for the due
execution, legality, validity, enforceability, genuineness, sufficiency or value
of this Agreement or the other Loan Documents or any other instrument or
document furnished pursuant hereto or thereto; and (f) shall incur no liability
under or in respect of this Agreement or the other Loan Documents by acting upon
any notice, consent, certificate or other instrument or writing (which may be by
telecopy, telegram, cable or telex) believed by it to be genuine and signed or
sent by the proper party or parties.
SECTION 9.03. GE CAPITAL AND AFFILIATES. With respect to its Revolving
Credit Commitment and portion of the Revolving Credit Loan hereunder, GE Capital
shall have the same rights and powers under this Agreement and the other Loan
Documents as any other Lender and may exercise the same as though it were not
the Administrative Agent; and the term "Lender" or "Lenders" shall, unless
otherwise expressly indicated, include GE Capital in its individual capacity. GE
Capital and its Affiliates may lend money to, invest in, and generally engage in
any kind of business with, any Credit Party, any of their Affiliates and any
Person who may do business with or own securities of any Credit Party or any
such Affiliate, all as if GE Capital were not the Administrative Agent and
without any duty to account therefor to Lenders. GE Capital and its Affiliates
may accept fees and other consideration from any Credit Party for services in
connection with this Agreement or otherwise without having to account for the
same to Lenders. Each Lender acknowledges the potential conflict of interest
between GE Capital as a Lender holding disproportionate interests in the
Revolving Credit Loan and GE Capital as the Administrative Agent.
SECTION 9.04. LENDER CREDIT DECISION. Each Lender acknowledges that it
has, independently and without reliance upon the Administrative Agent or any
other Lender and based on the Financial Statements and such other documents and
information as it has deemed appropriate, made its own credit and financial
analysis of the Credit Parties and its own decision to enter into this
Agreement. Each Lender also acknowledges that it will, independently and without
reliance upon the Administrative Agent or any other Lender and based on such
documents and information as it shall deem appropriate at the time, continue to
make its own credit decisions in taking or not taking action under this
Agreement. Each Lender acknowledges the potential conflict of interest of each
other Lender as a result of Lenders holding disproportionate interests in the
Revolving Credit Loan, and expressly consents to, and waives any claim based
upon, such conflict of interest.
SECTION 9.05. INDEMNIFICATION. Lenders agree to indemnify the
Administrative Agent (to the extent not reimbursed by Borrower and without
limiting the obligations of Borrower hereunder), ratably according to their
respective Pro Rata Shares, from and against any and all liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements of any kind or nature whatsoever which may be imposed
on, incurred by, or asserted against the Administrative Agent in any way
relating to or arising out of this Agreement or any other
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Loan Document or any action taken or omitted by the Administrative Agent in
connection therewith; PROVIDED, HOWEVER, that no Lender shall be liable for any
portion of such liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses or disbursements resulting solely from the
Administrative Agent's gross negligence or willful misconduct as finally
determined by a court of competent jurisdiction. Without limiting the foregoing,
each Lender agrees to reimburse the Administrative Agent promptly upon demand
for its Pro Rata Share of any out-of-pocket expenses (including counsel fees)
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 and each
other Loan Document, to the extent that the Administrative Agent is not
reimbursed for such expenses by Borrower or any other Credit Party.
SECTION 9.06. SUCCESSOR ADMINISTRATIVE AGENT. The Administrative Agent
may resign at any time by giving not less than thirty (30) days' prior written
notice thereof to Lenders and Borrower. Upon any such resignation, the Required
Lenders shall have the right to appoint a successor Administrative Agent. If no
successor Administrative Agent shall have been so appointed by the Required
Lenders and shall have accepted such appointment within 30 days after the
resigning Administrative Agent's giving notice of resignation, then the
resigning Administrative Agent may, on behalf of Lenders, appoint a successor
Administrative Agent, which shall be a Lender, if a Lender is willing to accept
such appointment, or otherwise shall be a commercial bank or financial
institution or a subsidiary of a commercial bank or financial institution if
such commercial bank or financial institution is organized under the laws of the
United States of America or of any State thereof and has a combined capital and
surplus of at least $300,000,000. If no successor Administrative Agent has been
appointed pursuant to the foregoing, by the 30th day after the date such notice
of resignation was given by the resigning Administrative Agent, such resignation
shall become effective and the Required Lenders shall thereafter perform all the
duties of the Administrative Agent hereunder until such time, if any, as the
Required Lenders appoint a successor Administrative Agent as provided above. Any
successor Administrative Agent appointed by the Required Lenders hereunder shall
be subject to the approval of Borrower, such approval not to be unreasonably
withheld or delayed; PROVIDED that such approval shall not be required if a
Default or an Event of Default shall have occurred and be continuing. Upon the
acceptance of any appointment as Administrative Agent hereunder by a successor
Administrative Agent, such successor Administrative Agent shall succeed to and
become vested with all the rights, powers, privileges and duties of the
resigning Administrative Agent. Upon the earlier of the acceptance of any
appointment as the Administrative Agent hereunder by a successor Administrative
Agent or the effective date of the resigning Administrative Agent's resignation,
the resigning Administrative Agent shall be discharged from its duties and
obligations under this Agreement and the other Loan Documents, except that any
indemnity rights or other rights in favor of such resigning Administrative Agent
shall continue. After any resigning Administrative Agent's resignation
hereunder, the provisions of this ARTICLE 9 shall inure to its benefit as to any
actions taken or omitted to be taken by it while it was the Administrative Agent
under this Agreement and the other Loan Documents. The Administrative Agent may
be removed at the written direction of the Required
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Lenders; provided that in so doing, such Required Lenders shall be deemed to
have waived and released any and all claims they may have against the
Administrative Agent.
SECTION 9.07. DISSEMINATION OF INFORMATION. The Administrative Agent
will use reasonable efforts to provide Lenders with any notice of Default or
Event of Default received by the Administrative Agent from, or delivered by the
Administrative Agent to, Borrower or any other Credit Party, with notice of any
Event of Default of which the Administrative Agent has actually become aware and
with notice of any action taken by the Administrative Agent following any Event
of Default; PROVIDED, HOWEVER, that the Administrative Agent shall not be liable
to any Lender for any failure to do so, except to the extent that such failure
is attributable solely to the Administrative Agent's gross negligence or willful
misconduct as finally determined by a court of competent jurisdiction. Lenders
acknowledge that Borrower is required to provide financial statements to Lenders
in accordance with SECTION 4.01 hereof and agree that the Administrative Agent
shall have no duty to provide the same to Lenders.
SECTION 9.08. RELEASE OF COLLATERAL. Upon indefeasible payment in full
in cash and performance of all of the outstanding Obligations (other than
indemnification Obligations under SECTION 1.12), termination of the Revolving
Credit Commitments of all Lenders and a release of all claims against the
Administrative Agent and Lenders, and so long as no suits, actions, proceedings,
or claims are pending or threatened against any Indemnified Person asserting any
damages, losses or liabilities that are indemnified Claims, the Administrative
Agent shall deliver to Borrower termination statements, mortgage releases and
other documents necessary or appropriate to evidence the termination of the
Liens securing payment of the Obligations.
ARTICLE 10
SUCCESSORS AND ASSIGNS
SECTION 10.01. SUCCESSORS AND ASSIGNS. This Agreement and the other
Loan Documents shall be binding on and shall inure to the benefit of Borrower,
Lenders, the Agents and their respective successors and assigns (including, in
the case of Borrower or any other Credit Party, a debtor-in-possession on behalf
of Borrower or such Credit Party), except as otherwise provided herein or
therein. Borrower may not assign, delegate, transfer, hypothecate or otherwise
convey its rights, benefits, obligations or duties hereunder or under any of the
Loan Documents without the prior express written consent of the Administrative
Agent and the Required Lenders. Any such purported assignment, transfer,
hypothecation or other conveyance by Borrower without such prior express written
consent shall be void. The terms and provisions of this Agreement and the other
Loan Documents are for the purpose of defining the relative rights and
obligations of Borrower, Lenders and Agents with respect to the transactions
contemplated hereby and there shall be no third party beneficiaries of any of
the terms and provisions of this Agreement or any of the other Loan Documents.
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SECTION 10.02. ASSIGNMENTS AND PARTICIPATIONS.
(a) Subject to the terms and conditions of this SECTION 10.02,
each Lender shall have the right to assign or sell participations in, at any
time or times, the Loan Documents, Revolving Credit Loan, Letter of Credit
Obligations and any Revolving Credit Commitment or of any portion thereof or
interest therein, including any Lender's rights, title, interests, remedies,
powers or duties thereunder, whether evidenced by a writing or not. Each such
assignment by a Lender shall (i) require the consent of Borrower (which shall
not be unreasonably withheld or delayed) unless a Default or Event of Default
shall have occurred and be continuing, (ii) require the consent of the
Administrative Agent (which shall not be unreasonably withheld or delayed),
(iii) require the execution of an assignment and assumption agreement (an
"ASSIGNMENT AGREEMENT") substantially in the form attached hereto as EXHIBIT D
and otherwise in form and substance satisfactory to, and acknowledged by, the
Administrative Agent; (iv) be a PRO RATA assignment of its Revolving Credit
Commitment and its ratable portion of the Revolving Credit Loan, (v) be
conditioned on such assignee Lender's representing to the assigning Lender and
the Administrative Agent that it is purchasing the portion of the Revolving
Credit Loan to be assigned to it for its own account, for investment purposes
and not with a view to the distribution thereto; (vi) if a partial assignment,
be in an amount at least equal to $5,000,000 or, if less, the assigning Lender's
entire remaining interest and, after giving effect to any such partial
assignment, other than an assignment of its entire remaining interest, the
assigning Lender shall have retained Revolving Credit Loan and/or a Revolving
Credit Commitment in an amount at least equal to $5,000,000; and (vii) include a
payment to the Administrative Agent of an assignment fee of $3,500. In the case
of an assignment by a Lender under this SECTION 10.02, the assignee shall have,
to the extent of such assignment, the same rights, benefits and obligations as
it would if it were a Lender hereunder. Each assigning Lender shall be relieved
of its obligations hereunder with respect to its Revolving Credit Commitment or
assigned portion thereof from and after the date of such assignment. Borrower
hereby acknowledges and agrees that any assignment will give rise to a direct
obligation of Borrower to the assignee and that the assignee shall be considered
to be a "Lender". In all instances, each Lender's liability to make Revolving
Credit Advances hereunder shall be several and not joint and shall be limited to
such Lender's Pro Rata Share of the applicable Revolving Credit Advance. In the
event any Lender assigns or otherwise transfers all or any part of a Revolving
Credit Note, Borrower shall, upon the request of the Administrative Agent or
such Lender, execute new Revolving Credit Notes in exchange for the Revolving
Credit Notes being assigned. Notwithstanding the foregoing provisions of this
SECTION 10.02(A), any Lender may at any time pledge or assign all or any portion
of such Lender's rights under this Agreement and the other Loan Documents to a
Federal Reserve Bank; PROVIDED, HOWEVER, that no such pledge or assignment shall
release such Lender from such Lender's obligations hereunder or under any other
Loan Document.
(b) Any participation by a Lender of all or any part of its
Revolving Credit Loan and/or Revolving Credit Commitment shall be in an amount
at least equal to $1,000,000, and with the understanding that all amounts
payable by Borrower hereunder shall be determined as if that Lender had not sold
such participation, and that the holder of any such participation shall not be
entitled to require such Lender to take or omit to take any action hereunder
except actions directly
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affecting (i) any reduction in the principal amount of , or interest rate or
Fees payable with respect to, any Loan in which such holder participates, (ii)
any extension of the scheduled amortization of the principal amount of any Loan
in which such holder participates or the final maturity date thereof, and (iii)
any release of all or substantially all of the Collateral (other than in
accordance with the terms of this Agreement, the Collateral Documents or the
other Loan Documents). Solely for purposes of SECTIONS 1.14, 1.15 and 11.08,
Borrower acknowledges and agrees that a participation shall give rise to a
direct obligation of Borrower to the participant and the participant shall be
considered to be a "Lender." Except as set forth in the preceding sentence
neither Borrower nor any other Credit Party shall have any obligation or duty to
any participant. Neither the Administrative Agent nor any Lender (other than the
Lender selling a participation) shall have any duty to any participant and may
continue to deal solely with the Lender selling a participation as if no such
sale had occurred.
(c) Except as expressly provided in this SECTION 10.02, no
Lender shall, as between Borrower and that Lender, or the Administrative Agent
and that Lender, be relieved of any of its obligations hereunder as a result of
any sale, assignment, transfer or negotiation of, or granting of participation
in, all or any part of the Revolving Credit Loan, the Revolving Credit Notes or
other Obligations owed to such Lender.
(d) Borrower and each of its Subsidiaries shall assist any
Lender permitted to sell assignments or participations under this SECTION 10.02
as reasonably required to enable the assigning or selling Lender to effect any
such assignment or participation, including the execution and delivery of any
and all agreements, notes and other documents and instruments as shall
reasonably be requested and the preparation of informational materials for, and
the participation of management in meetings with, potential assignees or
participants. Borrower and each of the other Credit Parties shall certify the
correctness, completeness and accuracy of all descriptions of such Credit Party
and their affairs contained in any selling materials provided by it and all
other information provided by it and included in such materials, except that any
Projections delivered by Borrower shall only be certified by Borrower as having
been prepared by Borrower in compliance with the representations contained in
SCHEDULE 3.04.
ARTICLE 11
MISCELLANEOUS
SECTION 11.01. COMPLETE AGREEMENT. This Agreement and the other Loan
Documents constitute the complete agreement among the parties with respect to
the subject matter hereof and thereof and supersede all prior agreements,
commitments, understandings or inducements (oral or written, expressed or
implied) relating to a financing of substantially similar form, purpose or
effect. This Agreement is a continuation of, an amendment to, and a restatement
of, the Original Credit Agreement. This Agreement shall not in any event be
deemed a novation of the Original Credit Agreement, and all rights and remedies
of Lender, and all debts, liabilities and obligations of
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Borrower, under the Original Credit Agreement, as amended and restated hereby,
shall continue to exist from and after the execution of this Agreement.
SECTION 11.02. AMENDMENTS AND WAIVERS.
(a) Except for actions expressly permitted to be taken by the
Administrative Agent, no amendment, modification, termination or waiver of any
provision of this Agreement or any of the Revolving Credit Notes, or any consent
to any departure by any Credit Party therefrom, shall in any event be effective
unless the same shall be in writing and signed by the Administrative Agent and
Borrower, and by the Required Lenders or all affected Lenders, as applicable.
Except as set forth in paragraphs (b) and (c) below, all such amendments,
modifications, terminations or waivers requiring the consent of any Lenders
shall require the written consent of the Required Lenders.
(b) No amendment, modification, termination or waiver of or
consent with respect to any provision of this Agreement which increases the
percentage advance rate set forth in the definition of "Borrowing Base" shall be
effective unless the same shall be in writing and signed by the Administrative
Agent, the Required Lenders and Borrower. No amendment, modification,
termination or waiver of or consent with respect to any provision of this
Agreement which waives compliance with the conditions precedent set forth in
SECTION 2.02 to the making of any Revolving Credit Advance or the incurrence of
any Letter of Credit Obligations shall be effective unless the same shall be in
writing and signed by the Administrative Agent, the Required Lenders and
Borrower. Notwithstanding anything contained in this Agreement to the contrary,
no waiver or consent with respect to any Default (if in connection therewith the
Administrative Agent or the Required Lenders, as the case may be, have exercised
its or their right to suspend the making or incurrence of further Revolving
Credit Advances or Letter of Credit Obligations pursuant to SECTION 8.02(A)) or
any Event of Default shall be effective for purposes of the conditions precedent
to the making of Revolving Credit Advances or the incurrence of Letter of Credit
Obligations set forth in SECTION 2.02 unless the same shall be in writing and
signed by the Administrative Agent, the Required Lenders and Borrower.
(c) No amendment, modification, termination or waiver shall,
unless in writing and signed by the Administrative Agent and each Lender, do any
of the following: (i) increase the principal amount of any Revolving Credit
Commitment; (ii) except as otherwise permitted under SECTION 6.08, release any
Credit Party from liability under the Subsidiary Guaranty or release all or
substantially all of the Collateral; (iii) amend or waive this SECTION 11.02,
any provision of this Agreement requiring consent or action on the part of the
Required Lenders or the definition of the term "Required Lenders;" (iv) extend
any scheduled payment date or final maturity date of the principal amount of the
Revolving Credit Loan; (v) reduce the principal of, rate of interest on or Fees
payable with respect to any Revolving Credit Commitment, Loan or Letter of
Credit Obligations, or (vi) waive, forgive, defer, extend or postpone any
payment of interest or Fees.
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(d) No amendment, modification, termination or waiver
affecting the rights or duties of the Administrative Agent under this Agreement
or any other Loan Document shall be effective unless in writing and signed by
the Administrative Agent, in addition to the Lenders required hereinabove to
take such action.
(e) Each amendment, modification, termination or waiver shall
be effective only in the specific instance and for the specific purpose for
which it was given. No amendment, modification, termination or waiver shall be
required for the Administrative Agent to take additional Collateral pursuant to
any Loan Document. No amendment, modification, termination or waiver of any
provision of any Revolving Credit Note shall be effective without the written
concurrence of the holder of that Revolving Credit Note. No notice to or demand
on any Credit Party in any case shall entitle such Credit Party or any other
Credit Party to any other or further notice or demand in similar or other
circumstances. Any amendment, modification, termination, waiver or consent
effected in accordance with this SECTION 11.02 shall be binding upon each holder
of the Revolving Credit Notes at the time outstanding and each future holder of
the Revolving Credit Notes.
SECTION 11.03. FEES AND EXPENSES; CERTAIN TAXES.
(a) Borrower shall reimburse the Agents for all reasonable
out-of-pocket expenses incurred in connection with the preparation, negotiation,
execution, delivery and syndication of this Agreement and the other Loan
Documents (including the reasonable fees and expenses of the Agents' special
counsel, advisors, consultants and auditors retained in connection with this
Agreement and the other Loan Documents and advice in connection therewith).
Borrower shall reimburse the Administrative Agent (and, with respect to clauses
(iii), (iv) and (v) below, all Lenders) for all reasonable fees, costs and
expenses, including the reasonable fees, costs and expenses of counsel or other
advisors (including environmental and management consultants and appraisers) for
advice, assistance, or other representation in connection with:
(i) wire transfer fees and other costs of the
forwarding to Borrower or any other Person on behalf of Borrower by the
Administrative Agent of the proceeds of the Revolving Credit Loan;
(ii) any amendment, modification or waiver of, or
consent with respect to, any of the Loan Documents or advice in
connection with the administration of the Revolving Credit Loan made
pursuant hereto or its rights hereunder or thereunder;
(iii) any litigation, contest, dispute, suit,
proceeding or action (whether instituted by the Administrative Agent,
the Syndication Agent, any Lender, Borrower, any other Credit Party or
any other Person) in any way relating to the Collateral, any of the
Loan Documents or any other agreement to be executed or delivered in
connection therewith or herewith, whether as party, witness, or
otherwise, including any litigation, contest, dispute, suit, case,
proceeding or action, and any appeal or review thereof, in connection
with a case commenced by or against Borrower, any other Credit Party or
any other Person that may be
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obligated to Lenders or the Agents by virtue of the Loan Documents,
including any such litigation, contest, dispute, suit, proceeding or
action arising in connection with any work-out or restructuring of the
Revolving Credit Loan during the pendency of one or more Events of
Default; PROVIDED, that Borrower shall not be liable to reimburse the
Administrative Agent, the Syndication Agent or any Lender for any such
fees, costs or expenses incurred by it in the defense of any Claim as
to which such Person would not be entitled to indemnification by virtue
of the proviso to SECTION 1.12(A).
(iv) any attempt to enforce any remedies of the
Administrative Agent or any Lender against any or all of the Credit
Parties or any other Person that may be obligated to the Administrative
Agent or any Lender by virtue of any of the Loan Documents;
(v) any work-out or restructuring of the Revolving
Credit Loan during the pendency of one or more Events of Default; or
(vi) any efforts to verify, protect, evaluate,
assess, appraise, collect, sell, liquidate or otherwise dispose of any
of the Collateral after the occurrence and during the continuance of an
Event of Default;
including all reasonable attorneys' and other professional and service
providers' fees arising from such services, including those in connection with
any appellate proceedings; and all reasonable out-of-pocket expenses, costs,
charges and other fees incurred by such counsel and others in any way or respect
arising in connection with or relating to any of the events or actions described
in this SECTION 11.03 shall be payable, on demand, by Borrower to the Agents or
Lenders, as applicable. Without limiting the generality of the foregoing, such
expenses, costs, charges and fees may include: reasonable fees, costs and
expenses of accountants, environmental advisors, appraisers, investment bankers,
management and other consultants and paralegals; court costs and expenses;
photocopying and duplication expenses; court reporter fees, costs and expenses;
long distance telephone charges; air express charges; telegram or telecopy
charges; secretarial overtime charges; and expenses for travel, lodging and food
paid or incurred in connection with the performance of such legal or other
advisory services.
(b) In addition, Borrower agrees to pay any present or future
intangible personal property, stamp or documentary taxes or any other excise or
property taxes, charges or similar levies that arise from any payment made
hereunder or under the Revolving Credit Notes or from the execution, delivery,
recording or registration of, or otherwise with respect to, this Agreement, any
of the Mortgages or any of the other Collateral Documents or Loan Documents or
any other matter contemplated by this Agreement, within ten (10) Business Days
after demand by the Administrative Agent or any Lender therefor (including
penalties, interest and expenses arising therefrom or with respect thereto),
whether or not such taxes were correctly or legally asserted.
SECTION 11.04. NO WAIVER. No failure on the part of the Administrative
Agent or any Lender, at any time or times, to require strict performance by
Borrower or any other Credit Party
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with any provision of this Agreement and any of the other Loan Documents shall
waive, affect or diminish any right of the Administrative Agent or Lenders
thereafter to demand strict compliance and performance therewith. Any suspension
or waiver of a Default or Event of Default shall not suspend, waive or affect
any other Default or Event of Default whether the same is prior or subsequent
thereto and whether of the same or of a different type. None of the
undertakings, agreements, warranties, covenants and representations of Borrower
or any other Credit Party contained in this Agreement or any of the other Loan
Documents and no Default or Event of Default by Borrower shall be deemed to have
been suspended or waived by the Administrative Agent or Lenders, unless such
waiver or suspension is by an instrument in writing signed by an officer of or
other authorized employee of the Administrative Agent or the Required Lenders
and directed to Borrower specifying such suspension or waiver.
SECTION 11.05. REMEDIES. The rights and remedies of Lenders and the
Agents under this Agreement and the other Loan Documents shall be cumulative and
nonexclusive of any other rights and remedies which Lenders and the Agents may
have under any other agreement, including the Loan Documents, by operation of
law or otherwise. Recourse to the Collateral shall not be required.
SECTION 11.06. SEVERABILITY. Wherever possible, each provision of this
Agreement and each of the other Loan Documents shall be interpreted in such
manner as to be effective and valid under applicable law, but if any provision
of this Agreement or any of the other Loan Documents shall be prohibited by or
invalid under applicable law, such provision shall be ineffective to the extent
of such prohibition or invalidity, without invalidating the remainder of such
provision or the remaining provisions of this Agreement or any of the other Loan
Documents.
SECTION 11.07. CONFLICT OF TERMS. Except as otherwise provided in this
Agreement or any of the other Loan Documents by specific reference to the
applicable provisions of this Agreement, if any provision contained in this
Agreement is in conflict with, or inconsistent with, any provision contained in
any of the other Loan Documents, the provisions contained in this Agreement
shall govern and control.
SECTION 11.08. SETOFF AND SHARING OF PAYMENTS.
(a) In addition to any rights now or hereafter granted under
applicable law and not by way of limitation of any such rights, upon the
occurrence and during the continuance of any Event of Default, each Lender and
each holder of any Revolving Credit Note is hereby authorized to the extent
permitted by applicable law at any time or from time to time, without notice to
Borrower or any of the other Credit Parties or to any other Person, any such
notice being hereby expressly waived, to set off and to appropriate and to apply
any and all balances held by it at any of its offices for the account of
Borrower or any other Credit Party (regardless of whether such balances are then
due to Borrower or such Credit Party) and any other properties or assets any
time held or owing by that Lender or that holder to or for the credit or for the
account of Borrower or any other Credit Party against and on account of any of
the Obligations which are not paid when due.
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(b) Any Lender or holder of any Revolving Credit Note
exercising a right to set off or otherwise receiving any payment on account of
the Obligations in excess of its Pro Rata Share thereof shall purchase for cash
(and the other Lenders or holders shall sell) such participations in each such
other Lender's or holder's Pro Rata Share of the Obligations as would be
necessary to cause such Lender to share the amount so set off or otherwise
received with each other Lender or holder in accordance with their respective
Pro Rata Shares. Borrower and each of the other Credit Parties agree, to the
fullest extent permitted by law, that (a) any Lender or holder may exercise its
right to set off with respect to amounts in excess of its Pro Rata Share of the
Obligations and may sell participations in such amount so set off to other
Lenders and holders and (b) any Lender or holders so purchasing a participation
in the Revolving Credit Loan made or other Obligations held by other Lenders or
holders may exercise all rights of set-off, bankers' lien, counterclaim or
similar rights with respect to such participation as fully as if such Lender or
holder were a direct holder of the Revolving Credit Loan and the other
Obligations in the amount of such participation. Notwithstanding the foregoing,
if all or any portion of the set-off amount or payment otherwise received is
thereafter recovered from the Lender that has exercised the right of set-off,
the purchase of participations by that Lender shall be rescinded and the
purchase price restored without interest.
SECTION 11.09. AUTHORIZED SIGNATURE. Until the Administrative Agent
shall be notified by Borrower to the contrary, the signature upon any document
or instrument delivered pursuant hereto and believed by the Administrative Agent
or any of the Administrative Agent's officers, agents, or employees to be that
of an officer or duly authorized representative of Borrower or any other Credit
Party listed in SCHEDULE 11.09 shall bind Borrower and all other Credit Parties
and be deemed to be the act of Borrower or such other Credit Party affixed
pursuant to and in accordance with resolutions duly adopted by Borrower's or
such other Credit Party's Board of Directors, and the Administrative Agent shall
be entitled to assume the authority of each signature and authority of the
Person whose signature it is or appears to be unless the Person acting in
reliance on such signature shall have actual knowledge of the fact that such
signature is false or the Person whose signature or purported signature is
presented is without authority.
SECTION 11.10. NOTICES. Except as otherwise provided herein, whenever
it is provided herein that any notice, demand, request, consent, approval,
declaration or other communication shall or may be given to or served upon any
of the parties by another party, or whenever any of the parties desires to give
or serve upon another party any communication with respect to this Agreement or
any of the other Loan Documents, each such notice, demand, request, consent,
approval, declaration or other communication shall be in writing and shall be
deemed to have been validly served, given or delivered (a) upon the earlier of
actual receipt and three (3) Business Days after deposit in the United States
Mail, registered or certified mail, return receipt requested, with proper
postage prepaid, (b) upon transmission, when sent by telecopy or other similar
facsimile transmission (with such telecopy or facsimile promptly confirmed by
delivery of a copy by personal delivery or United States Mail as otherwise
provided in this SECTION 11.10), (c) one Business Day after deposit with a
reputable overnight courier with all charges prepaid, or (d) when delivered, if
hand-delivered by messenger, all of which shall be addressed to the party to be
notified and sent to the address or
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facsimile number indicated below or to such other address (or facsimile number)
as may be substituted by notice given as herein provided. The giving of any
notice required hereunder may be waived in writing by the party entitled to
receive such notice. Failure or delay in delivering copies of any notice,
demand, request, consent, approval, declaration or other communication to any
Person (other than the Administrative Agent, Borrower or a Lender) designated
below to receive copies shall in no way adversely affect the effectiveness of
such notice, demand, request, consent, approval, declaration or other
communication.
(a) If to the Administrative Agent, at:
General Electric Capital Corporation
0000 Xxxxxxxxx Xxxx, X.X.
Xxxxx 000
Xxxxxxx, Xxxxxxx 00000
Attention: Xx. Xxxxxx X. Xxxx
Telecopy No.: (000) 000-0000
with copies to:
General Electric Capital Corporation
000 Xxxx Xxxxx Xxxx
Xxxxxxxx, Xxxxxxxxxxx 00000-0000
Attention: Region Counsel - Commercial Finance
Telecopy No.: (000) 000-0000
and
King & Spalding
000 Xxxxxxxxx Xxxxxx
Xxxxxxx, Xxxxxxx 00000-0000
Attention: Xxxx Xxxx Xxxxxxx, Esq.
Telecopy No.: (000) 000-0000
(b) if to Borrower, at:
Ramsay Health Care, Inc.
Columbus Center
Xxx Xxxxxxxx Xxxxx
Xxxxx 000
Xxxxx Xxxxxx, Xxxxxxx 00000
Attention: Chief Financial Officer
Telecopy No.: (000) 000-0000
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with a copy to:
Xxxxxx & Xxxxxx
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxxx X. Cost, Esq.
Telecopy No.: (000) 000-0000
(c) if to any Lender, at its address for notices set forth
below its signature hereto.
SECTION 11.11. SECTION TITLES. The Section titles and Table of Contents
contained in this Agreement are and shall be without substantive meaning or
content of any kind whatsoever and are not a part of this Agreement.
SECTION 11.12. COUNTERPARTS. This Agreement may be executed in any
number of separate counterparts, each of which shall, collectively and
separately, constitute one agreement.
SECTION 11.13. TIME OF THE ESSENCE. Time is of the essence of this
Agreement and each of the other Loan Documents.
SECTION 11.14. PUBLICITY. Except to the extent otherwise required by
law, Borrower shall not use the name of or refer to GE Capital, or any of its
Affiliates, in any press release or other public disclosure made in connection
with the transactions contemplated by this Agreement or the Related Transactions
without the prior written consent of GE Capital, and shall provide to GE Capital
the proposed text of any such press release or other public disclosure for
review not later than two Business Days prior to the proposed date of release or
disclosure thereof.
SECTION 11.15. CONFIDENTIALITY. Borrower has furnished and will furnish
to Lenders certain information concerning Borrower, its Subsidiaries, Affiliates
and their respective businesses which Borrower has advised is non-public,
proprietary or confidential in nature ("CONFIDENTIAL INFORMATION"). Each of the
Administrative Agent and the Lenders confirms to Borrower, for itself, that it
is the Administrative Agent's or such Lender's policy and practice to maintain
in confidence all Confidential Information which is provided to it under
agreements providing for the extension of credit and which is identified to it
as such, and that it will protect the confidentiality of Confi dential
Information submitted to it with respect to Borrower under this Agreement,
commensurate with its efforts to maintain the confidentiality of its own
Confidential Information, PROVIDED, HOW EVER, that (a) nothing contained herein
shall prevent the Administrative Agent or any Lender from disclosing
Confidential Information (i) to its Affiliates and their respective directors,
officers and employees and to any legal counsel, auditors, appraisers,
consultants or other persons retained by it or its Affiliates as professional
advisors, on the condition that such information not be further disclosed except
in compliance with this SECTION 11.15; (ii) under color of legal authority,
including, without limitation, to any regulatory authority having jurisdiction
over it or its operations or to or under the authority of any court deemed by it
to be of competent jurisdiction; (iii) to any actual or
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potential assignee of or participant in such Lender's rights and obligations
under this Agreement pursuant to SECTION 10.02 hereof, to the extent such actual
or potential assignee or lender has agreed to maintain such information in
confidence on the basis set forth in this SECTION 11.15; and (iv) as necessary
in connection with the exercise of its remedies under this Agreement or any of
the other Loan Documents; (b) the terms of this SECTION 11.15 shall be
inapplicable to any information furnished to it which is in its possession prior
to the delivery to it of such information by Borrower, or otherwise has been
obtained by it on a non-confidential basis, or which was or becomes available to
the public or otherwise part of the public domain (other than as a result of the
Administrative Agent's or such Lender's failure to abide hereby), or which was
not non-public, proprietary or confidential when Borrower delivered it to the
Administrative Agent or such Lender; and (c) the determination by the
Administrative Agent or such Lender as to the application of any of the
circumstances described in the foregoing clauses (a) and (b) will be conclusive
if made reasonably and in good faith.
SECTION 11.16. GOVERNING LAW. EXCEPT AS OTHERWISE EXPRESSLY PROVIDED IN
ANY OF THE LOAN DOCUMENTS, IN ALL RESPECTS, INCLUDING ALL MATTERS OF
CONSTRUCTION, VALIDITY AND PERFORMANCE, THIS AGREEMENT AND THE OBLIGATIONS
ARISING HEREUNDER SHALL BE GOVERNED BY, AND CONSTRUED AND ENFORCED IN ACCORDANCE
WITH, THE LAWS OF THE STATE OF NEW YORK APPLICABLE TO CONTRACTS MADE AND
PERFORMED IN SUCH STATE, AND ANY APPLICABLE LAWS OF THE UNITED STATES OF
AMERICA. BORROWER AND EACH OTHER CREDIT PARTY HEREBY CONSENTS AND AGREES THAT
THE STATE OR FEDERAL COURTS LOCATED IN NEW YORK COUNTY, NEW YORK SHALL HAVE
EXCLUSIVE JURISDICTION TO HEAR AND DETERMINE ANY CLAIMS OR DISPUTES PERTAINING
TO THIS AGREEMENT OR ANY OF THE OTHER LOAN DOCUMENTS OR TO ANY MATTER ARISING
OUT OF OR RELATED TO THIS AGREEMENT OR ANY OF THE OTHER LOAN DOCUMENTS;
PROVIDED, THAT THE PARTIES ACKNOWLEDGE THAT ANY APPEALS FROM THOSE COURTS MAY
HAVE TO BE HEARD BY X XXXXX XXXXXXX XXXXXXX XX XXX XXXX XXXXXX, XXX XXXX; AND
FURTHER PROVIDED, THAT NOTHING IN THIS AGREEMENT SHALL BE DEEMED OR OPERATE TO
PRECLUDE LENDERS OR THE ADMINISTRATIVE AGENT FROM BRINGING SUIT OR TAKING OTHER
LEGAL ACTION IN ANY COURT OF COMPETENT JURISDICTION IN ANY OTHER JURISDICTION TO
COLLECT THE OBLIGATIONS, TO REALIZE ON THE COLLATERAL OR ANY OTHER SECURITY FOR
THE OBLIGATIONS, OR TO ENFORCE A JUDGMENT OR OTHER COURT ORDER IN FAVOR OF
LENDERS OR THE ADMINISTRATIVE AGENT. BORROWER AND EACH OTHER CREDIT PARTY
EXPRESSLY SUBMITS AND CONSENTS IN ADVANCE TO SUCH JURISDICTION IN ANY ACTION OR
SUIT COMMENCED IN ANY SUCH COURT, AND BORROWER AND EACH OTHER CREDIT PARTY
HEREBY WAIVES ANY OBJECTION WHICH BORROWER OR SUCH CREDIT PARTY MAY HAVE BASED
UPON LACK OF PERSONAL JURISDICTION, IMPROPER VENUE OR FORUM NON CONVENIENS AND
HEREBY CONSENTS TO THE GRANTING OF SUCH LEGAL OR EQUITABLE RELIEF AS IS DEEMED
APPROPRIATE BY ANY SUCH COURT. TO THE EXTENT PERMITTED BY APPLICABLE LAW,
BORROWER
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HEREBY WAIVES PERSONAL SERVICE OF THE SUMMONS, COMPLAINT AND OTHER PROCESS
ISSUED IN ANY SUCH ACTION OR SUIT AND AGREES THAT SERVICE OF SUCH SUMMONS,
COMPLAINTS AND OTHER PROCESS MAY BE MADE BY REGISTERED OR CERTIFIED MAIL
ADDRESSED TO BORROWER OR SUCH CREDIT PARTY AT THE ADDRESS FOR BORROWER SET FORTH
IN SECTION 11.10 OF THIS AGREEMENT AND THAT SERVICE SO MADE SHALL BE DEEMED
COMPLETED UPON THE EARLIER OF BORROWER'S ACTUAL RECEIPT THEREOF OR THREE (3)
BUSINESS DAYS AFTER DEPOSIT IN THE U.S. MAILS, PROPER POSTAGE PREPAID.
SECTION 11.17. WAIVER OF JURY TRIAL. BECAUSE DISPUTES ARISING IN
CONNECTION WITH COMPLEX FINANCIAL TRANSACTIONS ARE MOST QUICKLY AND ECONOMICALLY
RESOLVED BY AN EXPERIENCED AND EXPERT PERSONA ND THE PARTIES WISH APPLICABLE
STATE AND FEDERAL LAWS TO APPLY (RATHER THAN ARBITRATION RULES), THE PARTIES
DESIRE THAT THEIR DISPUTES BE RESOLVED BY A JUDGE APPLYING SUCH APPLICABLE LAWS.
THEREFORE, TO ACHIEVE THE BEST COMBINATION OF THE BENEFITS OF THE JUDICIAL
SYSTEM AND OF ARBITRATION, THE PARTIES HERETO WAIVE ALL RIGHT TO TRIAL BY JURY
IN ANY ACTION, SUIT, OR PROCEEDING BROUGHT TO RESOLVE ANY DISPUTE, WHETHER IN
CONTRACT, TORT, OR OTHERWISE, ARISING OUT OF, CONNECTED WITH, RELATED TO, OR
INCIDENTAL TO, THIS AGREEMENT OR ANY OF THE OTHER LOAN DOCUMENTS OR THE
TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY.
SECTION 11.18. ESTOPPEL. Each Credit Party represents and warrants that
there are no claims, causes of action, defenses, rights of offset, suits, debts,
liens, obligations, liabilities, demands, losses, costs and expenses (including
attorneys' fees) of any kind, character or nature whatsoever, known or unknown,
fixed or contingent, which Borrower may have or claim to have against any
Lender, the Administrative Agent or the Syndication Agent which arise out of or
in connection with any act or omission of such Lender, the Administrative Agent
or the Syndication Agent existing or occurring on or prior to each of the date
of this Agreement and the Effective Date, including, without limitation, any
claims, liabilities or obligations arising with respect to the Original Credit
Agreement or any of the Loan Documents.
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IN WITNESS WHEREOF, this Agreement has been duly executed as of the
date first written above.
"BORROWER"
RAMSAY HEALTH CARE, INC.
By: Xxxxx X. Xxxx
--------------------------------------
Name:
Title:
"ADMINISTRATIVE AGENT"
GENERAL ELECTRIC CAPITAL CORPORATION,
as Administrative Agent
By: Xxxxxx X. Xxxx
--------------------------------------
Xxxxxx X. Xxxx
Authorized Signatory
"LENDER"
Pro Rata Share of GENERAL ELECTRIC CAPITAL CORPORATION
Revolving Credit
Commitments: 100%
By: Xxxxxx X. Xxxx
---------------------------------------
Xxxxxx X. Xxxx
Authorized Signatory
ADDRESS FOR NOTICES:
0000 Xxxxxxxxx Xxxx, X.X.
Xxxxx 000
Xxxxxxx, Xxxxxxx 00000
Attention: Xx. Xxxxxx X. Xxxx
Telecopy No.: (000) 000-0000
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JOINDER OF CREDIT PARTIES
Each of the undersigned, being all of the Subsidiaries of Borrower that
are Credit Parties, joins in the execution and delivery of this Agreement as a
party hereto and, by its execution below:
1. confirms and joins in each of the representations, warranties,
covenants and agreements set forth in this Agreement with respect to such Credit
Party;
2. restates, ratifies and reaffirms each and every term and condition
set forth in the Original Credit Agreement, as modified by this Agreement,
effective as of the Effective Date;
3. reaffirms and ratifies its unconditional and irrevocable, joint and
several guarantee to GE Capital and its successors and assigns, of the prompt
payment (whether at stated maturity, by acceleration or otherwise) and
performance when due of the Obligations and reaffirms and ratifies all of its
other obligations under the Subsidiary Guaranty;
4. consents to the execution and delivery of this Agreement by the
Company, and acknowledges that it has received and reviewed a copy of this
Agreement; and
5. acknowledges and reaffirms that (i) all Liens granted to GE Capital
under the Collateral Documents remain in full force and effect and shall
continue to secure the Obligations and (ii) the validity, perfection or priority
of the Liens will not be impaired by the execution and delivery of this
Agreement.
IN WITNESS WHEREOF, each of such Credit Parties has executed this
Joinder of Credit Parties as of the 30th day of September, 1998.
AMERICARE OF GALAX, INC., a Virginia corporation
XXXXXXX PSYCHIATRIC HOSPITAL, INC., an Oklahoma corporation
BOUNTIFUL PSYCHIATRIC HOSPITAL, INC., a Utah corporation
CAROLINA TREATMENT CENTER, INC., a South Carolina corporation
EAST CAROLINA PSYCHIATRIC SERVICES CORPORATION, a North Carolina
corporation
GREAT PLAINS HOSPITAL, INC., a Missouri corporation
GREENBRIER HOSPITAL, INC., a Louisiana corporation
GULF COAST TREATMENT CENTER, INC., a Florida corporation
HAVENWYCK HOSPITAL, INC., a Michigan corporation
H.C. CORPORATION, an Alabama corporation
HOUMA PSYCHIATRIC HOSPITAL, INC., a Louisiana corporation
HSA HILL CREST CORPORATION, an Alabama corporation
HSA OF OKLAHOMA, INC., an Oklahoma corporation
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MESA PSYCHIATRIC HOSPITAL, INC., an Arizona corporation
MICHIGAN PSYCHIATRIC SERVICES, INC., a Michigan corporation
PSYCHIATRIC INSTITUTE OF WEST VIRGINIA, INC., a Virginia corporation
RAMSAY ACQUISITION CORP., a Delaware corporation
RAMSAY CORRECTIONAL SERVICES, INC., a Delaware corporation
RAMSAY LOUISIANA, INC., a Delaware corporation
RAMSAY MANAGED CARE, INC., a Delaware corporation
RAMSAY MANAGEMENT SERVICES OF WEST VIRGINIA, INC., a West Virginia
corporation
RAMSAY NEW ORLEANS, INC., a Delaware corporation
RAMSAY YOUTH SERVICES, INC., a Delaware corporation
RAMSAY YOUTH SERVICES OF ALABAMA, INC., a Delaware corporation
RAMSAY YOUTH SERVICES OF FLORIDA, INC., a Delaware corporation
RHCI SAN ANTONIO, INC., a Delaware corporation
THE HAVEN HOSPITAL, INC., a Delaware corporation
UTAH PSYCHIATRIC AFFILIATES, INC., a Delaware corporation
By: Xxxxx X. Xxxx
----------------------------------------
Xxxxx X. Xxxx, Vice President of
each of the foregoing Credit Parties
Attest: Xxxxx Xxxx
-------------------------------------
Xxxxx Xxxx, Assistant Secretary of
each of the foregoing Credit Parties
H. C. PARTNERSHIP, an Alabama general partnership
By: HSA HILL CREST CORPORATION, its General Partner
By: Xxxxx X. Xxxx
-------------------------------
Xxxxx X. Xxxx
Vice President
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