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Exhibit 10.9
THIRD AMENDMENT TO GUARANTEE AND
CONTINGENT PURCHASE AGREEMENT
THIS THIRD AMENDMENT TO GUARANTEE AND CONTINGENT PURCHASE AGREEMENT
(the "Amendment") is entered into this 14th day of October, 1993 by and among
NATIONAL HEALTHCORP L.P., a Delaware limited partnership ("NHLP"), NATIONAL
HEALTH CORPORATION, a Tennessee corporation ("National") (NHLP and National may
sometimes be referred to herein collectively as the "Guarantors"), THIRD
NATIONAL BANK IN NASHVILLE ("TNB"), SOUTHTRUST BANK OF ALABAMA, NATIONAL
ASSOCIATION ("ST"), FIRST UNION NATIONAL BANK OF TENNESSEE (formerly known as
Dominion Bank of Middle Tennessee) ("FUNB"), FIRST AMERICAN NATIONAL BANK
("FANB") and FIRST CITY BANK ("FCB") (TNB, ST, FUNB, FANB and FCB are
hereinafter sometimes collectively referred to as the "Banks"), and THIRD
NATIONAL BANK IN NASHVILLE, as agent for the Banks (in such capacity, the
"Agent").
WITNESSETH:
WHEREAS, pursuant to that certain Guarantee and Contingent Purchase
Agreement (the "Guarantee") dated as of December 16, 1988 by and among the
Guarantors, TNB, ST, Irving Trust Company (later known as The Bank of New York)
("BONY") and Sovran Bank/Central South (later known as Sovran Bank/Tennessee)
("SBT") and Agent, as amended by First Amendment to Guarantee and Contingent
Purchase Agreement dated October 17, 1991 by and among Guarantors, TNB, ST and
Agent and as further amended by Second Amendment to Guarantee and Contingent
Purchase Agreement dated May 21, 1992 by and among Guarantors. Banks and Agent
(as amended, the "Guarantee"), the Guarantors jointly and severally guaranteed,
among other things, repayment to the Banks of the following described notes
executed by National Health Corporation Leveraged Employee Stock Ownership Trust
(the "Borrower" or the "ESOP") to the order of the TNB, ST, BONY and SBT,
respectively (the "Notes"):
(a) a certain non-recourse promissory note dated as of
December 16, 1988 in the original principal amount of Sixteen Million
Dollars ($16,000,000) executed by Borrower payable to TNB, together
with interest and other charges thereon;
(b) a certain non-recourse promissory note dated December 16,
1988 in the original principal amount of Fifteen Million Dollars
($15,000,000) executed by Borrower payable to BONY, together with
interest and other charges thereon, as assigned to TNB pursuant to that
certain Assignment of Note and Loan Documents dated October 18, 1991
executed by BONY in favor of TNB;
(c) a certain non-recourse promissory note dated December 16,
1988 in the original principal amount of Nine Million Dollars
($9,000,000) executed by Borrower
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payable to ST, together with interest and other charges thereon, as
assigned to TNB pursuant to that certain Assignment of Note and Loan
Documents dated October 17, 1991 executed by SBT in favor of TNB; and
(d) a certain non-recourse promissory note dated December 16,
1988 in the original principal amount of Ten Million Dollars
($10,000,000) executed by Borrower payable to ST, together with
interest and other charges thereon;
WHEREAS, pursuant to Section 5 of the Guarantee, NHLP is obligated to
purchase the Notes on December 16, 1993 unless the Agent has notified NHLP no
less than sixty (60) days prior to December 16, 1993 that all of the Banks elect
not to tender the Notes;
WHEREAS, the Banks have directed the Agent to notify the NHLP that the
Banks elect not to tender the Notes to NHLP on December 16, 1993 provided that
NHLP agrees to a new Note Purchase Date (as such term is defined in the
Guarantee) of December 16, 1998, pursuant to the terms of this Amendment;
WHEREAS, the Guarantors desire to induce the Banks not to tender the
Notes to NHLP on December 16, 1993 and agree to enter into this Amendment;
WHEREAS, the Guarantors, the Banks and the Agent desire to amend the
Guarantee as hereinafter set forth.
NOW, THEREFORE, in consideration of the premises, and for other good
and valuable consideration, the receipt and sufficiency of which is hereby
acknowledged by the parties hereto, the parties agree as follows:
1. Section 5 of the Guarantee entitled "Contingent Purchase
Obligations" is hereby amended in its entirety to read as follows:
Section 5. Contingent Purchase Obligations. NHLP shall on
December 16, 1998 and, if agreed to and as negotiated by NHLP and the
Banks, thereafter, (each of which dates is referred to as a or the
"Note Purchase Date") purchase, upon tender by all of the Banks to NHLP
of all of the Notes with an instrument of assignment attached thereto,
the Loan evidenced by the Notes (and the Notes evidencing the same) by
payment to the Banks of an amount (representing the purchase price
therefor) in immediately available funds equal to the sum of the
principal of and accrued and unpaid interest on the Notes at the time
of such purchase together with any amounts that would be owing under
the Loan and Security Agreement in the event the Notes were being paid
in full at the time of such purchase. Such tender shall be deemed
automatically to be made, and title to the Notes shall be deemed
automatically to have passed to NHLP on each Note Purchase Date
whereupon NHLP shall become obligated forthwith to pay the purchase
price to the Banks, unless (a) Agent shall have notified NHLP no less
than sixty (60) days prior to the applicable Note Purchase Date that
all of the Banks elect not to so tender, or (b)
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NHLP requests the Banks (through the Agent) no less than ninety (90)
days prior to the applicable Note Purchase Date that the Banks not so
tender, and Agent shall have given the notice referred to in clause (a)
above within the time period provided therein, whereupon, in either
such case, NHLP shall not be obligated on such Note Purchase Date to
pay the purchase price to the Banks. The giving of notice by Agent
under clause (a) above shall not affect in any way the rights of the
Banks to tender all of the Notes to NHLP with respect to any subsequent
Note Purchase Date. The Banks and NHLP agree that if any Bank
determines to take advantage of the automatic tender provisions hereof
(the "Electing Bank"), then all Banks shall be bound by such
determination unless another Bank or Banks purchase the Electing Bank's
Note or interest in a Note, as applicable, prior to the sixty (60) day
period referred to in clause (a) above, but in no event shall any Bank
be obligated to purchase the Electing Bank's Note or interest in a
Note. In connection with any legal proceeding instituted by the Banks
to enforce the obligation of NHLP to pay such purchase price, NHLP
hereby waives any defense based upon adequate remedy at law and agrees
that specific performance is the only appropriate remedy for breach of
this Section 5. Any such purchase shall be made by NHLP from the Banks
without recourse and without representation or warranty of any Kind
whatsoever, other than with respect to each Bank's good title to its
Note and each such Note's being free of Liens caused by the Banks.
Following any such purchase, NHLP shall remain obligated under Section
2 hereof in respect of any other amounts owing, or from time to time to
be owing, by the Borrower under the Loan and Security Agreement.
2. The Guarantors hereby reaffirm for the Banks and the Agent all
of their respective obligations, representations, warranties and covenants
contained in the Guarantee.
3. The Guarantors hereby represent that no event has occurred and
no claim, offset, defense or other condition exists which with the passage of
time or giving of notice would constitute a default under any provisions of the
Guarantee, as hereby amended.
4. The Guarantors hereby further represent that no event has
occurred and no claim, offset, defense or other condition exists that would
relieve either NHLP and/or National of any of their respective obligations to
the Banks and/or Agent under the Guarantee, as hereby amended.
5. All terms used in this Amendment shall have the same meanings
as in the Guarantee unless otherwise defined herein.
6. Except as specifically modified herein, the Guarantee shall
remain in full force and effect, and nothing herein is intended to nor shall it
release, diminish or waive any rights of the Banks and Agent under the
Guarantee.
7. This Amendment may be executed in more than one counterpart,
all of which taken together, shall constitute one and the same instrument.
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8. This Amendment shall be governed by and construed in
accordance with the laws of the State of Tennessee.
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to
be duly executed as of the date first written above.
NATIONAL HEALTHCORP. L.P.,
a Delaware limited partnership
By: NHC, Inc., general partnership
By: /s/
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Title: Sr. V.P.
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NATIONAL HEALTH CORPORATION,
a Tennessee corporation
By: /s/
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Title: Sr. V.P.
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THIRD NATIONAL BANK IN NASHVILLE
By: /s/
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Title: Group V.P.
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SOUTHTRUST BANK OF ALABAMA,
NATIONAL ASSOCIATION
By: /s/
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Title: Group Vice President
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FIRST UNION NATIONAL BANK OF TENNESSEE
By: /s/
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Title: Vice President
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FIRST AMERICAN NATIONAL BANK
By: /s/
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Title: Senior Vice President
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FIRST CITY BANK
By: /s/
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Title: President
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THIRD NATIONAL BANK IN NASHVILLE,
Agent
By: /s/
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Title: Group V.P.
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