1
Exhibit 4.7
THIRD AMENDED AND RESTATED CREDIT AGREEMENT
2
[Execution Copy]
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$500,000,000.00
THIRD AMENDED AND RESTATED CREDIT AGREEMENT
Dated as of August 19, 1996
Among
LIVING CENTERS OF AMERICA, INC.
as Borrower,
THE BANKS NAMED IN THIS CREDIT AGREEMENT
as Banks,
CHASE SECURITIES INC.
as Syndication Agent,
TORONTO DOMINION (TEXAS), INC.
as Documentation Agent,
and
NATIONSBANK OF TEXAS, N.A.
as Administrative Agent
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TABLE OF CONTENTS
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Page
ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS
Section 1.01. Certain Defined Terms . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Section 1.02. Computation of Time Periods . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
Section 1.03. Accounting Terms; Changes in GAAP . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
Section 1.04. Classes and Types of Advances . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
Section 1.05. Miscellaneous . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
ARTICLE II
THE ADVANCES AND THE LETTERS OF CREDIT
Section 2.01. Tranche A and Tranche B Advances; Extension of Tranche A
Maturity Date. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
Section 2.02. Method of Borrowing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
Section 2.03. Competitive Advances . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
Section 2.04. Fees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
Section 2.05. Reduction of the Commitments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
Section 2.06. Repayment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
Section 2.07. Interest . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
Section 2.08. Prepayments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
Section 2.09. Breakage Costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
Section 2.10. Increased Costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
Section 2.11. Payments and Computations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
Section 2.12. Taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
Section 2.13. Sharing of Payments, Etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
Section 2.14. Letters of Credit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
Section 2.15. Bank Replacement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46
ARTICLE III
CONDITIONS OF LENDING
Section 3.01. Conditions Precedent to Effectiveness . . . . . . . . . . . . . . . . . . . . . . . . . . . 47
Section 3.02. Conditions Precedent to all Borrowings . . . . . . . . . . . . . . . . . . . . . . . . . . 48
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
Section 4.01. Corporate Existence; Subsidiaries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
Section 4.02. Corporate Power . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
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Section 4.03. Authorization and Approvals . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50
Section 4.04. Enforceable Obligations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50
Section 4.05. Financial Statements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50
Section 4.06. True and Complete Disclosure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50
Section 4.07. Litigation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51
Section 4.08. Use of Proceeds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51
Section 4.09. Investment Company Act . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51
Section 4.10. Public Utility Holding Company Act . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51
Section 4.11. Taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52
Section 4.12. Pension Plans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52
Section 4.13. No Burdensome Restrictions; No Defaults . . . . . . . . . . . . . . . . . . . . . . . . . . 53
Section 4.14. Environmental Condition . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53
Section 4.15. Permits, Licenses, etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54
Section 4.16. Health Care Regulatory Matters. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54
ARTICLE V
AFFIRMATIVE COVENANTS
Section 5.01. Compliance with Laws, Etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55
Section 5.02. Maintenance of Insurance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55
Section 5.03. Preservation of Corporate Existence, Etc. . . . . . . . . . . . . . . . . . . . . . . . . . 56
Section 5.04. Payment of Taxes, Etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56
Section 5.05. Visitation Rights . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56
Section 5.06. Reporting Requirements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56
Section 5.07. Maintenance of Property . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 59
Section 5.08. Additional Guaranties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 59
ARTICLE VI
NEGATIVE COVENANTS
Section 6.01. Liens, Etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60
Section 6.02. Debts, Guaranties and Other Obligations . . . . . . . . . . . . . . . . . . . . . . . . . . 61
Section 6.03. Agreements Restricting Liens and Distributions . . . . . . . . . . . . . . . . . . . . . . 62
Section 6.04. Merger or Consolidation; Asset Sales . . . . . . . . . . . . . . . . . . . . . . . . . . . 62
Section 6.05. Restricted Payments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 63
Section 6.06. Investments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 63
Section 6.07. Acquisition Expenditures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 64
Section 6.08. Affiliate Transactions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 64
Section 6.09. Compliance with ERISA . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 65
Section 6.10. Cash Flow Ratio . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 65
Section 6.11. Leverage Ratio . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 65
Section 6.12. Net Worth . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 65
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Section 6.13. Indemnification Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 65
ARTICLE VII
REMEDIES
Section 7.01. Events of Default . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 65
Section 7.02. Optional Acceleration of Maturity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 68
Section 7.03. Automatic Acceleration of Maturity . . . . . . . . . . . . . . . . . . . . . . . . . . . . 69
Section 7.04. Cash Collateral Account . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 69
Section 7.05. Non-exclusivity of Remedies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 70
Section 7.06. Right of Set-off . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 70
ARTICLE VIII
THE ADMINISTRATIVE AGENT AND THE ISSUING BANKS
Section 8.01. Authorization and Action . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 70
Section 8.02. Administrative Agent's Reliance, Etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . 71
Section 8.03. The Administrative Agent and Its Affiliates . . . . . . . . . . . . . . . . . . . . . . . . 71
Section 8.04. Bank Credit Decision . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 72
Section 8.05. INDEMNIFICATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 72
Section 8.06. Successor Administrative Agent and Issuing Banks . . . . . . . . . . . . . . . . . . . . . 73
ARTICLE IX
MISCELLANEOUS
Section 9.01. Amendments, Etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 74
Section 9.02. Notices, Etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 74
Section 9.03. No Waiver; Remedies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 75
Section 9.04. Costs and Expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 75
Section 9.05. Binding Effect . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 75
Section 9.06. Bank Assignments and Participations . . . . . . . . . . . . . . . . . . . . . . . . . . . . 75
Section 9.07. INDEMNIFICATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 78
Section 9.08. Execution in Counterparts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 79
Section 9.09. Survival of Representations, etc . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 79
Section 9.10. Severability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 79
Section 9.11. Business Loans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 79
Section 9.12. Usury Not Intended . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 79
Section 9.13. Confidentiality . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 80
Section 9.14. Governing Law . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 81
Section 9.15. Waiver of Jury . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 81
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EXHIBITS:
Exhibit A - Form of Assignment and Acceptance
Exhibit B - Form of Guaranty
Exhibit C - Form of Notice of Borrowing
Exhibit D - Form of Notice of Conversion or Continuation
Exhibit E-1 - Form of Tranche A Note
Exhibit E-2 - Form of Tranche B Note
Exhibit E-3 - Form of Competitive Advance Note
Exhibit F - Form of Compliance Certificate
Exhibit G-1 - Form of Competitive Bid Request
Exhibit G-2 - Form of Notice of Competitive Bid Request
Exhibit G-3 - Form of Competitive Bid
Exhibit G-4 - Form of Competitive Bid Acceptance/Rejection
SCHEDULES:
Schedule 1 - Notice Information for Banks
Schedule 4.01 - Subsidiaries
Schedule 6.01 - Certain Secured Debt
Schedule 6.02 - Certain Unsecured Debt
Schedule 6.08 - Certain Intercompany Arrangements
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THIRD AMENDED AND RESTATED CREDIT AGREEMENT
This Third Amended and Restated Credit Agreement dated as of August
19, 1996 is among (a) Living Centers of America, Inc., a Delaware corporation
("Borrower"); (b) the Banks (as defined below); (c) NationsBank of Texas, N.A.,
as Administrative Agent for the Banks; (d) Chase Securities Inc., as
Syndication Agent; and (e) Toronto Dominion (Texas), Inc., as Documentation
Agent.
The Borrower, the Banks, the Administrative Agent, the Syndication
Agent, and the Documentation Agent agree as follows:
INTRODUCTION
A. The Borrower, The Long-Term Credit Bank of Japan, Limited, New
York Branch, The Bank of Nova Scotia and Toronto Dominion (Texas), Inc., as
co-agents, the Administrative Agent, and certain of the Banks are parties to
the Second Amended and Restated Credit Agreement dated as of June 29, 1995 (as
the same has been amended, modified and supplemented since such date, the
"Existing Credit Agreement").
B. The Borrower, the Administrative Agent, the Syndication Agent,
the Documentation Agent, and the Banks have agreed to amend and restate the
Existing Credit Agreement by entering into this Agreement.
ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS
Section 1.01. Certain Defined Terms. As used in this Agreement,
the terms "Borrower" and "Existing Credit Agreement" shall have the meanings
set forth above and the following terms shall have the following meanings
(unless otherwise indicated, such meanings to be equally applicable to both the
singular and plural forms of the terms defined):
"Acquisition Expenditures" means, for any period, the aggregate of all
expenditures and costs of the Borrower and its Subsidiaries paid in cash, debt
securities, Property other than equity securities, or the assumption of Debt
during such period for (a) the purchase or expansion of care homes, care
centers, institutional pharmacies, rehabilitation clinics, or other business
assets from another Person, (b) the acquisition of stock, partnership,
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joint venture interests or other equity interests in any Person, and (c) the
construction or expansion of any care homes or care centers, institutional
pharmacies, rehabilitation clinics, or other business assets of the Borrower or
its Subsidiaries; excluding, however, the amount of the consideration paid
during such period in connection with the purchase of Property pursuant to the
options under the Unispec Leases in an amount not to exceed the lesser of (i)
the amount payable in connection with the exercise of any such option and (ii)
the fair market value of such Property on the date of such purchase.
"Adjusted Base Rate" means, for any day, the fluctuating rate per
annum of interest equal to the greater of (a) the Base Rate in effect on such
day and (b) the Federal Funds Rate in effect on such day plus 1/2%.
"Administrative Agent" means NationsBank of Texas, N.A. in its
capacity as an agent pursuant to Article VIII and any successor agent pursuant
to Section 8.06.
"Advance" means a Tranche A Advance, a Tranche B Advance or a
Competitive Advance.
"Affiliate" means, as to any Person, any other Person that, directly
or indirectly, through one or more intermediaries, controls, is controlled by,
or is under common control with, such Person or any Subsidiary of such Person.
The term "control" (including the terms "controlled by" or "under common
control with") means the possession, directly or indirectly, of the power to
direct or cause the direction of the management and policies of a Person,
whether through ownership of equity interests, by contract or otherwise.
"Agreement" means this Third Amended and Restated Credit Agreement
dated as of August 19, 1996 among the Borrower, the Banks, the Administrative
Agent, the Syndication Agent, and the Documentation Agent, as it may be
amended, modified, or supplemented from time-to-time.
"Applicable Lending Office" means, with respect to each Bank, such
Bank's Domestic Lending Office in the case of a Base Rate Advance and such
Bank's Eurodollar Lending Office in the case of a Eurodollar Rate Advance.
"Applicable Margin" means, at any time with respect to any Advance,
the commitment fee, or the Letter of Credit fees under Section 2.04, the
following percentages determined as a function of the Leverage Ratio most
recently determined as provided below in this definition:
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Level I Level II Level III Level IV Level V
Ratio
Ratio greater greater than Ratio greater
than or equal or equal to than or equal Ratio greater
Ratio to .75, but 1.75, but to 2.50, but than or equal
less than less than less than less than 3.00 to 3.00
.75 1.75 2.50
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Eurodollar Rate Advance .250% .325% .425% .500% .575%
- Tranche A Advance
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Eurodollar Rate Advance .300% .375% .500% .575% .650%
- Tranche B Advance
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Base Rate Advance 0% 0% 0% 0% 0.0%
------------------------------------------------------------------------------------------------------------
Facility Fee - Tranche .15% .175% .20% .25% .30%
A Commitment
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Facility Fee - Tranche .10% .125% .125% .175% .225%
B Commitment
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The foregoing ratio (a) shall be deemed to be Level III until September 30,
1996 and (b) shall thereafter be determined from the financial statements of
the Borrower and its Subsidiaries most recently delivered pursuant to Section
5.06. Any change in the Applicable Margin after September 30, 1996 shall be
effective upon the date of delivery of the financial statements pursuant to
Section 5.06. If the Borrower fails to deliver such financial statements after
September 30, 1996 within the times specified in Section 5.06, such ratio shall
be deemed to be Level V until the Borrower delivers such financial statements
to the Administrative Agent and the Banks.
"Assignment and Acceptance" means an assignment and acceptance entered
into by a Bank and an Eligible Assignee, and accepted by the Administrative
Agent, in substantially the form of the attached Exhibit A.
"Banks" means the lenders listed on the signature pages of this
Agreement and each Eligible Assignee that shall become a party to this
Agreement pursuant to Section 9.06.
"Base Rate" means a fluctuating interest rate per annum as shall be in
effect from time-to-time equal to the rate of interest publicly announced by
NationsBank of Texas, N.A. as its base rate, whether or not the Borrower has
notice thereof.
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"Base Rate Advance" means an Advance which bears interest as provided
in Section 2.07(a).
"Borrowing" means a Tranche A Borrowing, a Tranche B Borrowing, or a
Competitive Borrowing.
"Business Day" means a day of the year on which banks are not required
or authorized to close in New York City and Dallas, Texas and, if the
applicable Business Day relates to any Eurodollar Rate Advances, on which
dealings are carried on by banks in the London interbank market.
"Capital Expenditures" means, for any four fiscal quarter period, the
greater of:
(a) the aggregate of all expenditures and costs (whether paid in
cash or accrued as liabilities during that period and including that portion of
Capital Leases incurred during such period which are capitalized on the balance
sheet of the Borrower) of the Borrower and its Subsidiaries during such period
that, in conformity with GAAP, are required to be included in or reflected by
the property, plant or equipment or similar fixed asset accounts reflected in
the consolidated balance sheet of the Borrower, excluding, however:
(i) the amount of the consideration paid that the
Borrower books as a capital expenditure during such period in
connection with the purchase of Property pursuant to the options under
the Unispec Leases;
(ii) Acquisition Expenditures made during such period; and
(iii) up to $25,000,000.00 of aggregate cash consideration
paid during such period for all purchases of facilities which have
been leased by the Borrower or any of its Subsidiaries for at least
three years before the date of such purchase and
(b) $400 times the average number of skilled nursing beds of the
Borrower and its Subsidiaries during such period.
"Capital Leases" means, as applied to any Person, any lease of any
Property by such Person as lessee which would, in accordance with GAAP, be
required to be classified and accounted for as a capital lease on the balance
sheet of such Person.
"Cash Collateral Account" means a special interest bearing cash
collateral account containing cash deposited pursuant to Section 7.02(b) or
7.03(b) to be maintained at the Administrative Agent's office in accordance
with Section 7.04.
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"Cash Flow" means, for any period, (a) the Borrower's EBITDA for such
period plus (b) to the extent deducted in determining Net Income and without
duplication, Lease Expense minus (c) cash taxes paid by the Borrower and its
Subsidiaries during such period minus (d) Net Restricted Payments made during
such period minus (e) Capital Expenditures for such period.
"CERCLA" means the Comprehensive Environmental Response, Compensation,
and Liability Act of 1980, as amended, state and local analogs, and all rules
and regulations and requirements thereunder in each case as now or hereafter in
effect.
"Class" has the meaning set forth in Section 1.04.
"Code" means the Internal Revenue Code of 1986, as amended, and any
successor statute.
"Commitments" means, as to any Bank, its Tranche A Commitment and its
Tranche B Commitment.
"Competitive Advance" means any advance by a Bank to the Borrower
pursuant to Section 2.03 and refers to a Eurodollar Auction Advance or a Fixed
Rate Auction Advance.
"Competitive Advance Note" means a promissory note of the Borrower
payable to the order of any Bank, in substantially the form of the attached
Exhibit E-3, evidencing indebtedness of the Borrower to such Bank resulting
from Competitive Advances owing to such Bank.
"Competitive Bid" means an offer by a Bank to make a Competitive
Advance pursuant to Section 2.03 in the form of Exhibit G-3.
"Competitive Bid Acceptance/Rejection" means a notification in the
form of Exhibit G-4 made by the Borrower pursuant to Section 2.03 to accept or
reject a Competitive Bid.
"Competitive Bid Rate" means, as to any Competitive Advance made by a
Bank, (i) in the case of a Eurodollar Auction Advance, the Margin, and (ii) in
the case of a Fixed Rate Auction Advance, the fixed rate of interest offered by
the Bank making such Competitive Bid.
"Competitive Bid Request" means a request by the Borrower in the form
of Exhibit G-1 for Competitive Bids.
"Competitive Borrowing" means a Borrowing consisting of a Competitive
Advance or concurrent Competitive Advances from the Bank or Banks whose
Competitive Bids for such Borrowing have been accepted by the Borrower under
the bidding procedure described in Section 2.03.
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"CON" means a certificate of need or other license or permit issued by
a state health facilities planning board or similar agency or body required for
the construction, expansion, or investment in a health facility.
"Control Percentage" means, with respect to any Person, the percentage
of the outstanding capital stock or other ownership interests of such Person
having ordinary voting power which gives the direct or indirect holder of such
stock or interests the power to elect a majority of the Board of Directors or
similar governing body of such Person.
"Controlled Group" means all members of a controlled group of
corporations and all trades (whether or not incorporated) under common control
which, together with the Borrower, are treated as a single employer under
Section 414 of the Code.
"Convert", "Conversion", and "Converted" each refers to a conversion
of Advances of one Type into Advances of another Type pursuant to Section
2.02(b).
"Credit Documents" means this Agreement, the Notes, the Guaranties,
the Letter of Credit Documents, and each other agreement, instrument or
document executed by the Borrower or any of its Subsidiaries at any time in
connection with this Agreement.
"Debt," for any Person, means without duplication:
(a) indebtedness of such Person for borrowed money;
(b) obligations of such Person evidenced by bonds, debentures,
notes or other similar instruments;
(c) obligations of such Person to pay the deferred purchase price
of property or services;
(d) obligations of such Person as lessee under Capital Leases;
(e) obligations of such Person under direct or indirect guaranties
in respect of, and obligations (contingent or otherwise) of such Person to
purchase or otherwise acquire, or otherwise to assure a creditor against loss
in respect of, indebtedness or obligations of another Person of the kinds
referred to in clauses (a) through (d) above;
(f) indebtedness or obligations of others of the kinds referred to
in clauses (a) through (e) secured by any Lien on or in respect of any Property
of such Person; and
(g) all liabilities of such Person in respect of unfunded vested
benefits under any Plan.
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"Default" means (a) an Event of Default or (b) any event or condition
which with notice or lapse of time or both would, unless cured or waived,
become an Event of Default.
"Devcon Stock Sale" means the sale by the Borrower of more than a
majority of its ownership interest in Living Centers-Devcon, Inc., a wholly
owned Subsidiary of the Borrower, for an amount not less than $47,500,000.00,
subject to post-closing working capital adjustments payable by the Borrower.
"Documentation Agent" means Toronto-Dominion (Texas), Inc.
"Dollar Equivalent" means the equivalent in another currency of an
amount in Dollars to be determined by reference to the rate of exchange quoted
by NationsBank, N.A., at 10:00 a.m. (Charlotte, North Carolina time) on the
date of determination, for the spot purchase in the foreign exchange market of
such amount of Dollars with such other currency.
"Dollars" and "$" means lawful money of the United States of America.
"Domestic Lending Office" means, with respect to any Bank, the office
of such Bank specified as its "Domestic Lending Office" opposite its name on
Schedule 1 or such other office of such Bank as such Bank may from time-to-time
specify to the Borrower and the Administrative Agent.
"EBITDA" means, for any period, (a) Net Income for such period plus
(b) to the extent deducted in determining Net Income, Interest Expense, taxes,
depreciation and amortization for such period.
"Effective Date" has the meaning set forth in Section 3.01.
"Eligible Assignee" means (a) a commercial bank organized under the
laws of the United States, or any State thereof, and having primary capital of
not less than $500,000,000.00 and approved by the Borrower, which approval will
not be unreasonably withheld, (b) a commercial bank organized under the laws of
any other country which is a member of the Organization for Economic
Cooperation and Development and having primary capital (or its equivalent) of
not less than $500,000,000.00 (or its Dollar Equivalent) and approved by the
Borrower, which approval by the Borrower will not be unreasonably withheld, (c)
a Bank, or (d) any other Person that has been approved by the Borrower in its
sole discretion and the Administrative Agent, which approval by the
Administrative Agent will not be unreasonably withheld.
"Environment" or "Environmental" shall have the meanings set forth in
43 U.S.C. Section 9601(8) (1988).
-7-
14
"Environmental Claim" means any third party (including governmental
agencies and employees) action, lawsuit, claim, demand, regulatory action or
proceeding, order, decree, consent agreement or notice of potential or actual
responsibility or violation (including claims or proceedings under the
Occupational Safety and Health Acts or similar laws or requirements relating to
health or safety of employees) which seeks to impose liability under any
Environmental Law.
"Environmental Law" means all Legal Requirements arising from,
relating to, or in connection with the Environment, health, or safety,
including without limitation CERCLA, relating to (a) pollution, contamination,
injury, destruction, loss, protection, cleanup, reclamation or restoration of
the air, surface water, groundwater, land surface or subsurface strata, or
other natural resources; (b) solid, gaseous or liquid waste generation,
treatment, processing, recycling, reclamation, cleanup, storage, disposal or
transportation; (c) exposure to pollutants, contaminants, hazardous, medical,
infectious, or toxic substances, materials or wastes; or (d) the manufacture,
processing, handling, transportation, distribution in commerce, use, storage or
disposal of hazardous, medical, infectious, or toxic substances, materials or
wastes.
"Environmental Permit" means any permit, license, order, approval or
other authorization under Environmental Law.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended from time-to-time.
"Eurocurrency Liabilities" has the meaning assigned to that term in
Regulation D of the Federal Reserve Board, as in effect from time-to-time.
"Eurodollar Advance" means any Eurodollar Rate Advance or Eurodollar
Auction Advance.
"Eurodollar Auction Advance" means any Competitive Advance which bears
interest as provided in Section 2.07(c).
"Eurodollar Lending Office" means, with respect to any Bank, the
office of such Bank specified as its "Eurodollar Lending Office" opposite its
name on Schedule 1 (or, if no such office is specified, its Domestic Lending
Office) or such other office of such Bank as such Bank may from time-to-time
specify to the Borrower and the Administrative Agent.
"Eurodollar Rate" means, for the Interest Period for each Eurodollar
Advance, the interest rate per annum (rounded upward to the nearest 1/100 of 1%
per annum) appearing on Telerate Page 3750 (or any successor page) as the
London interbank offered rate for deposits in Dollars at approximately 11:00
a.m. (London time) two Business Days before the first day of such
-8-
15
Interest Period for a term comparable to such Interest Period. If for any
reason such rate is not available, the term "Eurodollar Rate" shall mean, for
the Interest Period for each Eurodollar Advance, the interest rate per annum
(rounded upward to the nearest 1/100 of 1% per annum) appearing on Reuters
Screen LIBO page as the London interbank offered rate for deposits in Dollars
at approximately 11:00 a.m. (London time) two Business Days before the first
day of such Interest Period for a term comparable to such Interest Period;
provided, however, if more than one rate is specified on Reuters Screen LIBO
page, the applicable rate shall be the arithmetic mean of all such rates
"Eurodollar Rate Advance" means an Advance which bears interest as
provided in Section 2.07(b).
"Eurodollar Rate Reserve Percentage" of any Bank for the Interest
Period for any Eurodollar Rate Advance means the reserve percentage applicable
during such Interest Period (or if more than one such percentage shall be so
applicable, the daily average of such percentages for those days in such
Interest Period during which any such percentage shall be so applicable) under
regulations issued from time-to-time by the Federal Reserve Board for
determining the actual reserve requirement (including, without limitation, any
emergency, supplemental or other marginal reserve requirement) for such Bank
with respect to liabilities or assets consisting of or including Eurocurrency
Liabilities having a term equal to such Interest Period.
"Events of Default" has the meaning set forth in Section 7.01.
"Expiration Date" means, with respect to any Letter of Credit, the
date on which such Letter of Credit will expire or terminate in accordance with
its terms.
"Facility" means any nursing home or other health care facility
(including any facility operating an assisted living unit) operated by the
Borrower or any of its Subsidiaries.
"Federal Funds Rate" means, for any period, a fluctuating interest
rate per annum equal for each day during such period to the weighted average of
the rates on overnight Federal funds transactions with members of the Federal
Reserve System arranged by Federal funds brokers, as published for such day
(or, if such day is not a Business Day, for the next preceding Business Day) by
the Federal Reserve Bank of New York, or, if such rate is not so published for
any day which is a Business Day, the average of the quotations for any such day
on such transactions received by the Administrative Agent from three Federal
funds brokers of recognized standing selected by it.
"Federal Reserve Board" means the Board of Governors of the Federal
Reserve System or any of its successors.
-9-
16
"Financial Statements" means the balance sheet and income, retained
earnings and cash flow statements dated September 30, 1995 referred to in
Section 4.05(a), copies of which have been delivered to the Administrative
Agent and the Banks.
"Fixed Rate Auction Advance" means any Competitive Advance which bears
interest as provided in Section 2.07(d).
"Fund," "Trust Fund," or "Superfund" means the Hazardous Substance
Response Trust Fund, established pursuant to 42 U.S.C. Section 9631 (1988) and
the Post-closure Liability Trust Fund, established pursuant to 42 U.S.C.
Section
9641 (1988), which statutory provisions have been amended or repealed by the
Superfunds Amendments and Reauthorization Act of 1986, and the "Fund," "Trust
Fund," or "Superfund" that are now maintained pursuant to Section 9507 of the
Code.
"Funded Debt" means the outstanding principal amount of all
indebtedness for borrowed money of any Person, but in any event shall include,
without duplication:
(a) any obligation with respect to the principal component of a
Capital Lease;
(b) the face amount of any standby letters of credit supporting
the repayment of indebtedness for borrowed money issued for the account of such
Person; and
(c) obligations of such Person under direct or indirect guaranties
in respect of, and obligations (contingent or otherwise) of such Person to
purchase or otherwise acquire, or otherwise to assure a creditor against loss
in respect of, debt for borrowed money of another Person, including obligations
of a type described in clauses (a) and (b) of this definition of another
Person; excluding, however any liabilities for insurance premiums financed by
the Borrower and its Subsidiaries.
In determining the amount of the foregoing clause (c), only the outstanding
principal amount or principal component of the obligation of the other Person
shall be used in such determination.
"GAAP" means United States generally accepted accounting principles as
in effect from time-to-time, applied on a basis consistent with the
requirements of Section 1.03.
"Governmental Authority" means any foreign governmental authority, the
United States of America, any state of the United States of America and any
subdivision of any of the foregoing, and any agency, department, commission,
board, authority or instrumentality, bureau or court having jurisdiction over
any Bank, the Borrower, or the Borrower's Subsidiaries or any of their
respective Properties.
-10-
17
"Governmental Proceedings" means any action or proceedings by or
before any Governmental Authority, including, without limitation, the
promulgation, enactment or entry of any Legal Requirement.
"Guarantor" means each Subsidiary of the Borrower that has entered
into a Guaranty, and "Guarantors" means such Persons collectively.
"Guaranty" means a guaranty in the form of the attached Exhibit B
executed by a Subsidiary of the Borrower, and "Guaranties" means all such
Guaranties.
"Hazardous Substance" means the substances identified as such pursuant
to CERCLA and those regulated under any other Environmental Law, including
without limitation pollutants, contaminants, petroleum, petroleum products,
radionuclides, radioactive materials, and medical and infectious waste.
"Hazardous Waste" means the substances regulated as such pursuant to
any Environmental Law.
"HCFA" means the Health Care Financing Administration of HHS and any
Person succeeding to the functions thereof.
"Health Facility License" means a license or permit under applicable
law to provide skilled or intermediate care nursing services, operate an
assisted living unit or otherwise operate a Facility.
"HHS" means the Department of Health and Human Services and any Person
succeeding to the functions thereof.
"Indemnification Agreement" means the Indemnification Agreement dated
as of February 21, 1992 between The ARA Group, Inc. and the Borrower.
"Interest Expense" means, for any period and any Person, total
interest expense for such Person net of any interest income for such period
(including any income received under an Interest Hedge Agreements during such
period, but other than interest income earned on any restricted cash listed on
such Person's balance sheet during such period), whether paid or accrued
(including that attributable to (a) obligations which have been or should be,
in accordance with GAAP, recorded as Capital Leases and (b) obligations payable
under Debt permitted by Section 6.02(m)), including, without limitation, all
commissions, discounts and other fees and charges owed with respect to letters
of credit and bankers' acceptance financing and net costs under Interest Hedge
Agreements, all as determined in conformity with GAAP.
-11-
18
"Interest Hedge Agreement" means an interest hedge, rate swap, or cap,
or similar arrangement between the Borrower or any of its Subsidiaries and a
financial institution providing for the exchange of nominal interest
obligations or the cap of the interest rate on the Advances made under this
Agreement.
"Interest Period" means, (a) for each Eurodollar Rate Advance, the
period commencing on the date of such Advance or the date of the Conversion of
any Base Rate Advance into such an Advance and ending on the last day of the
period selected by the Borrower pursuant to the provisions below and Section
2.02 and, thereafter, each subsequent period commencing on the last day of the
immediately preceding Interest Period and ending on the last day of the period
selected by the Borrower pursuant to the provisions below and Section 2.02,
which period shall be one, two, three, or six months, in each case as the
Borrower may, upon notice received by the Administrative Agent not later than
noon (Dallas, Texas time) on, the third Business Day prior to the first day of
such Interest Period select, (b) for each Eurodollar Auction Advance, the
period commencing on the date of such Advance and ending on the last day of the
period selected by the Borrower pursuant to the provisions below and Section
2.03, which period shall be one, two, three, or six months, in each case as the
Borrower may select in the Competitive Bid Request for such Advance and (c)
for each Fixed Rate Auction Advance, the period commencing on the date of such
Advance and ending on the date requested by the Borrower in the Competitive Bid
Request for such Advance, which period shall be not less than seven days or
more than 180 days; provided, however, that:
(a) no Interest Period for a Tranche A Advance may extend beyond
the Tranche A Maturity Date;
(b) the Borrower may not select any Interest Period for any
Tranche B Advance which ends after any scheduled principal repayment date
(including the Tranche B Commitment Termination Date) unless, after giving
effect to such selection, the aggregate unpaid principal amount of Tranche B
Advances that are Base Rate Advances and Tranche B Advances having Interest
Periods which end on or before such principal repayment date at least equal the
amount of Tranche B Advances due and payable on or before such principal
repayment date;
(c) Interest Periods commencing on the same date for Advances
comprising part of the same Borrowing shall be of the same duration;
(d) whenever the last day of any Interest Period would otherwise
occur on a day other than a Business Day, the last day of such Interest Period
shall be extended to occur on the next succeeding Business Day, provided that
in case of a Eurodollar Advance only, if such extension would cause the last
day of such Interest Period to occur in the next following calendar month, the
last day of such Interest Period shall occur on the next preceding Business
Day; and
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19
(e) in case of a Eurodollar Advance only, any Interest Period
which begins on the last Business Day of a calendar month (or on a day for
which there is no numerically corresponding day in the calendar month at the
end of such Interest Period) shall end on the last Business Day of the calendar
month in which it would have ended if there were a numerically corresponding
day in such calendar month.
"Interim Financial Statements" means the unaudited balance sheet and
income and cash flow statements dated June 30, 1996 referred to in Section
4.05(a), copies of which have been delivered to the Administrative Agent and
the Banks.
"Issuing Bank" means any Bank which agrees at the request of the
Borrower to act as an issuer of a Letter of Credit hereunder, or any Bank
acting as a successor issuing bank pursuant to Section 8.06.
"Lease Expense" means, for any period, (a) all amounts payable by the
Borrower and its Subsidiaries during such period under any lease, sublease, or
other instrument (other than a Capital Lease) pursuant to which the Borrower or
any of its Subsidiaries is entitled to use any Property of another Person minus
(b) all rental income payable to the Borrower and its Subsidiaries during such
period under any lease, sublease, or other instrument (other than a Capital
Lease) pursuant to which the Borrower or any of its Subsidiaries was the lessor
or sublessor of its Property to another Person, all as determined in accordance
with GAAP.
"Legal Requirement" means any law, statute, ordinance, decree,
requirement, order, judgment, rule, regulation (or official interpretation of
any of the foregoing) of, and the terms of any license or permit issued by, any
Governmental Authority, including, but not limited to, Regulations G, T, U and
X.
"Letter of Credit" means, individually, any letter of credit issued by
an Issuing Bank which is subject to this Agreement, and "Letters of Credit"
means all such letters of credit collectively.
"Letter of Credit Documents" means, with respect to any Letter of
Credit, such Letter of Credit and any agreements, documents, and instruments
entered into in connection with or relating to such Letter of Credit.
"Letter of Credit Exposure" means, at any time, the sum of (a) the
aggregate undrawn maximum face amount of each Letter of Credit at such time and
(b) the aggregate unpaid amount of all Reimbursement Obligations at such time.
"Letter of Credit Obligations" means any obligations of the Borrower
under this Agreement in connection with the Letters of Credit.
-13-
20
"Leverage Ratio" means, as of the last day of any fiscal quarter of
the Borrower, the ratio of (a) the Borrower and its Subsidiaries' Funded Debt
plus, to the extent not included in Funded Debt, the face amount of any letters
of credit issued for the account of the Borrower or any of its Subsidiaries and
outstanding as of such day to (b) the Borrower's EBITDA for the four fiscal
quarters ending on such day plus, with respect to each acquisition permitted by
this Agreement and made during such period and without duplication, the
aggregate amount of the EBITDA during such period attributable to the business
acquired minus, with respect any asset sales permitted by this Agreement and
made during such period, the aggregate amount of the Borrower's EBITDA
attributable to the assets sold during such period.
"Lien" means any mortgage, lien, pledge, charge, deed of trust,
security interest, or encumbrance to secure or provide for the payment of any
obligation of any Person, whether arising by contract, operation of law or
otherwise (including, without limitation, the interest of a vendor or lessor
under any conditional sale agreement, Capital Lease or other title retention
agreement).
"Liquid Investments" means:
(a) direct obligations of, or obligations the principal of and
interest on which are unconditionally guaranteed by, the United States;
(b) (i) negotiable or nonnegotiable certificates of deposit, time
deposits, or other similar banking arrangements maturing within one year from
the date of acquisition thereof ("bank debt securities"), issued by (A) any
Bank that is a commercial bank or commercial financial institution or (B) any
other bank or trust company which has a combined capital surplus and undivided
profit of not less than $500,000,000.00 or the Dollar Equivalent thereof, if at
the time of deposit or purchase, such bank debt securities are rated not less
than "A" (or the then equivalent) by the rating service of Standard & Poor's
Corporation or of Xxxxx'x Investors Service, and (ii) commercial paper issued
by (A) any Bank that is a commercial bank or commercial financial institution
or (B) any other Person if at the time of purchase such commercial paper is
rated not less than "A-2" (or the then equivalent) by the rating service of
Standard & Poor's Rating Group or not less than "P-2" (or the then equivalent)
by the rating service of Xxxxx'x Investors Service, Inc., or upon the
discontinuance of both of such services, such other nationally recognized
rating service or services, as the case may be, as shall be selected by the
Borrower with the consent of the Majority Banks;
(c) repurchase agreements relating to investments described in
clauses (a) and (b) above with a market value at least equal to the
consideration paid in connection therewith, with any Person who regularly
engages in the business of entering into repurchase agreements and has a
combined capital surplus and undivided profit of not less than $500,000,000.00
or the Dollar
-14-
21
Equivalent thereof, if at the time of entering into such agreement the debt
securities of such Person are rated not less than "A" (or the then equivalent)
by the rating service of Standard & Poor's Rating Group or of Xxxxx'x Investors
Service, Inc.;
(d) such other instruments (within the meaning of Article 9 of the
Texas Business and Commerce Code) as the Borrower may request and the
Administrative Agent may approve in writing, which approval will not be
unreasonably withheld;
(e) money market mutual funds with a daily right of redemption and
a net asset value of $1.00 per share substantially all the assets of which are
comprised of investments of the types described in the preceding clauses (a)
through (d);
(f) investments by LCA Insurance Co., Ltd. made in compliance with
the requirements of all Governmental Authorities, including Medicare
Regulations; and
(g) demand deposit accounts with a bank or other financial
institution opened and maintained in the ordinary course of business.
"Majority Banks" means, at any time, Banks holding at least 51% of the
then aggregate unpaid principal amount of the Advances owed to the Banks and
the Letter of Credit Exposure of the Banks at such time, or, if no such
principal amount and Letter of Credit Exposure is then outstanding, Banks
having at least 51% of the aggregate amount of the Commitments at such time.
"Margin" means, as to any Eurodollar Auction Advance, the margin
(expressed as a percentage rate per annum in the form of a decimal to more than
four decimal places) to be added to or subtracted from the Eurodollar Rate in
order to determine the interest rate applicable to such Advance, as specified
in the Competitive Bid relating to such Advance.
"Material Adverse Change" means a material adverse change in the
business, financial condition, or results of operations of the Borrower and its
Subsidiaries, taken as a whole, since the date of the Financial Statements.
"Material Adverse Effect" means a material adverse effect (a) on the
Borrower's ability to perform its obligations under this Agreement, any Note or
any other Credit Document; (b) on the Guarantors', taken as a whole, ability to
perform their obligations under the Guaranties; or (c) on the business,
financial condition, or results of operations of the Borrower and its
Subsidiaries, taken as a whole.
"Maximum Rate" means the maximum nonusurious interest rate under
applicable law.
-15-
22
"Medicaid Certification" means certification by the state Medicaid
agency or its successor that a Facility complies with all the requirements for
participation set forth in the Medicaid Regulations.
"Medicaid Provider Agreement" means an agreement entered into between
the state Medicaid agency or its successor or other such entity administering
the Medicaid program and a Facility which the agency agrees to pay for covered
services provided by such Facility to eligible Medicaid recipients in
accordance with the terms of such agreement and Medicaid Regulations.
"Medicaid Regulations" means, collectively, (a) all Federal statutes
(whether set forth in Title XIX of the Social Security Act or elsewhere)
affecting the medical assistance program established by Title XIX of the Social
Security Act (42 U.S.C. Sections 1396, et seq.); (b) all applicable provisions
of all federal rules, regulations, manuals, final orders and administrative,
reimbursement and other guidelines of all Governmental Authorities promulgated
pursuant to or in connection with the statutes described in clause (a) above;
(c) all state statutes and regulations and plans for medical assistance enacted
in connection with the statutes and provisions described in clauses (a) and (b)
above; and (d) all applicable provisions of all rules, regulations, manuals,
final orders and administrative, reimbursement and other applicable guidelines
of all Governmental Authorities promulgated pursuant to or in connection with
any of the foregoing.
"Medicare Certification" means certification by HCFA or a state agency
or entity under contract with HCFA that a Facility complies with all the
applicable requirements for participation set forth in the Medicare
Regulations.
"Medicare Provider Agreement" means an agreement entered into between
HCFA or a state agency under contract with HCFA and a Facility under which HCFA
agrees to pay for covered services provided by such Facility to Medicare
beneficiaries in accordance with the terms of such agreement and Medicare
Regulations.
"Medicare Regulations" means, collectively, all Federal statutes
(whether set forth in Title XVIII of the Social Security Act or elsewhere)
affecting the health insurance program for the aged and disabled established by
Title XVIII of the Social Security Act (42 U.S.C. Sections 1395, et seq.),
together with all applicable provisions of all rules, regulations, manuals,
final orders and administrative, reimbursement and other applicable guidelines
of all Governmental Authorities, including HHS, HCFA, or the Office of the
Inspector General of HHS, or any Person succeeding to the functions of any of
the foregoing (whether or not having the force of law).
"Multiemployer Plan" means a "multiemployer plan" as defined in
Section 4001(a)(3) of ERISA to which the Borrower or any member of the
Controlled Group is making or accruing an obligation to make contributions.
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23
"Net Cash Proceeds" means, with respect to any sale, transfer, or
other disposition of any of the Borrower's or any of its Subsidiaries' Property
(including the sale or transfer of stock in any such Subsidiary) all cash and
Liquid Investments received by the Borrower or any of its Subsidiaries from
such sale, transfer or other disposition after (a) provision for all income or
other taxes payable in respect of the fiscal year in which such sale, transfer
or other disposition occurs measured by or resulting from such sale, transfer,
or other disposition and which are payable in such fiscal year or the
succeeding fiscal year, (b) payment of, or provision for, all brokerage
commissions and other reasonable out-of-pocket fees and expenses actually
incurred, (c) payments in connection with such sale, transfer, or other
disposition made to repay any liabilities, and (d) the amount of reserves
recorded in accordance with GAAP for indemnity or similar obligations of the
Borrower and its Subsidiaries directly related to such sale, transfer or other
disposition.
"Net Income" means, for any period for any Person, such Person's net
income for such period after taxes, as determined in accordance with GAAP,
excluding, however, extraordinary items, including (a) any net gain or loss
during such period arising from the sale, exchange, or other disposition of
capital assets (such term to include all fixed assets and all securities) other
than in the ordinary course of business and (b) any write-up or write-down of
assets.
"Net Restricted Payments" means, for any period, (a) all Restricted
Payments made by the Borrower during such period minus (b) the sum of (i) the
Net Cash Proceeds received from any sales of the Borrower's common stock to any
of the Borrower's employees pursuant to any employee stock option plan,
employee compensation arrangement, or employee benefit plan during such period;
(ii) the amount paid by the Borrower to purchase any of its common stock during
such period that has been contributed to an employee benefit plan of the
Borrower during such period; and (iii) payments in amount not to exceed
$20,000,000.00 made for any purchases by the Borrower of its common stock
during the year ending December 31, 1996; provided that Net Restricted Payments
shall never be less than zero.
"Net Worth" means, at any date for any Person that is a corporation,
the sum of (a) the par value (or value stated on the books of such Person) of
the capital stock of all classes of such Person, (b) the additional paid-in
capital of such Person, and (c) the amount of the surplus and retained
earnings, whether capital or earned, of such Person, all determined in
accordance with GAAP, excluding, however, the value of any redeemable preferred
stock or similar capital stock of such Person.
"Nonprofit Subsidiary" means any of the Borrower's wholly-owned
Subsidiaries that are qualified under Section 501(c) of the Code as a nonprofit
corporation.
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"Nonordinary Course Asset Sales" means (a) the sale of any division of
the Borrower or any of its Subsidiaries, (b) the sale of all of the Facilities
of the Borrower or any of its Subsidiaries in a specific geographic area, or
(c) the sale of stock of a Subsidiary of the Borrower by the Borrower or any of
its Subsidiaries, excluding, however, the Devcon Stock Sale.
"Note" means a Tranche A Note, a Tranche B Note or a Competitive
Advance Note.
"Notice of Borrowing" means a notice of borrowing in the form of the
attached Exhibit C signed by a Responsible Officer of the Borrower.
"Notice of Conversion or Continuation" means a notice of conversion or
continuation in the form of the attached Exhibit D signed by a Responsible
Officer of the Borrower.
"Obligations" means all Advances, Reimbursement Obligations, and other
amounts payable by the Borrower to the Administrative Agent, the Issuing Banks
or the Banks under the Credit Documents.
"PBGC" means the Pension Benefit Guaranty Corporation or any entity
succeeding to any or all of its functions under ERISA.
"Permitted Liens" means the Liens permitted to exist pursuant to
Section 6.01.
"Person" means an individual, partnership, corporation (including a
business trust), joint stock company, trust, unincorporated association, joint
venture, limited liability company, or other entity, or a government or any
political subdivision or agency thereof or any trustee, receiver, custodian or
similar official.
"Plan" means an employee benefit plan (other than a Multiemployer
Plan) maintained for employees of the Borrower or any member of the Controlled
Group and covered by Title IV of ERISA or subject to the minimum funding
standards under Section 412 of the Code.
"Project QC" means the proposed acquisition by the Borrower or any of
its Subsidiaries of eight facilities from four limited partnerships the general
partner of which is a wholly-owned subsidiary of QualiCorp., Inc.
"Property" of any Person means any property or assets (whether real,
personal, or mixed, tangible or intangible) of such Person.
"Pro Rata Share" means, at any time with respect to any Bank, either
(a) the ratio (expressed as a percentage) of such Bank's Commitments at such
time to the aggregate Commitments at such
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time, (b) if the Commitments have been terminated, the ratio (expressed as a
percentage) of such Bank's aggregate outstanding Advances and Letter of Credit
Exposure at such time to the aggregate outstanding Advances and Letter of
Credit Exposure of all the Banks at such time, or (c) if no Advances are then
outstanding and no Commitments then in effect, the ratio (expressed as a
percentage) of the aggregate principal amount of such Bank's Advances when most
recently outstanding to the aggregate principal amount of all Advances when
most recently outstanding.
"Register" has the meaning set forth in paragraph (c) of Section 9.06.
"Regulations G, T, U, and X" means Regulation G, T, U, and X of the
Federal Reserve Board, as each is from time-to-time in effect, and all official
rulings and interpretations thereunder or thereof.
"Reimbursement Obligations" means all of the obligations of the
Borrower set forth in paragraph (c) of Section 2.14.
"Release" shall have the meaning set forth in CERCLA or under any other
Environmental Law.
"Response" shall have the meaning set forth in CERCLA or under any
other Environmental Law.
"Responsible Officer" means the chief executive officer, president,
chief financial officer, treasurer, general counsel, or secretary of any
Person.
"Restricted Payment" means the making by any Person of any dividends
or other distributions (in cash, property, or otherwise) on, or any payment for
the purchase, redemption or other acquisition of, any shares of any capital
stock of such Person, other than dividends payable in such Person's stock.
"Revolving Borrowing" means a Tranche A Borrowing or a Tranche B
Borrowing.
"Subordinated Debt" means any Debt of the Borrower or any of its
Subsidiaries which is subordinated to their respective obligations under the
Credit Documents and which is on terms and conditions reasonably satisfactory
to the Administrative Agent and the Majority Banks.
"Subsidiary" of a Person means any corporation or other entity of
which more than 50% of the outstanding capital stock or other ownership
interests having ordinary voting power to elect a majority of the board of
directors or similar governing body of such corporation or other entity
(irrespective of whether at such time capital stock or other ownership
interests of any other class
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or classes of such corporation or other entity shall or might have voting power
upon the occurrence of any contingency) is at the time directly or indirectly
owned by such Person, by such Person and one or more Subsidiaries of such
Person or by one or more Subsidiaries of such Person.
"Syndication Agent" means Chase Securities Inc.
"Tangible Net Assets" means, as of any date, (a) total assets of a
Person indicated on its balance sheet less (b) the sum of the value indicated
on such Person's balance sheet of patents, trademarks, copyrights, goodwill,
and other intangible assets.
"Terminating Bank" has the meaning set forth in Section
2.01(c)(iii)(B).
"Termination Event" means (a) the occurrence of a Reportable Event
with respect to a Plan, as described in Section 4043 of ERISA and the
regulations issued thereunder (other than a Reportable Event not subject to the
provision for 30-day notice to the PBGC under such regulations), (b) the
withdrawal of the Borrower or any of its Affiliates from a Plan during a plan
year in which it was a "substantial employer" as defined in Section 4001(a)(2)
of ERISA, (c) the giving of a notice of intent to terminate a Plan under
Section 4041(c) of ERISA, (d) the institution of proceedings to terminate a
Plan by the PBGC, or (e) any other event or condition which constitutes grounds
under Section 4042 of ERISA for the termination of, or the appointment of a
trustee to administer, any Plan.
"Tranche A Advance" means any advance by a Bank to the Borrower as
part of a Tranche A Borrowing and refers to a Base Rate Advance or a Eurodollar
Rate Advance.
"Tranche A Borrowing" means a borrowing consisting of simultaneous
Tranche A Advances made by each Bank pursuant to Section 2.01(a) or Converted
by each Bank to Tranche A Advances of a different Type pursuant to Section
2.02(b). Except as provided in Sections 2.02(c)(iii) and (v) and 2.08(e), all
Advances included in a Borrowing shall be of the same Type.
"Tranche A Commitment" means, for each Bank, the amount set opposite
such Bank's name on the signature pages of this Agreement as its Tranche A
Commitment or, if such Bank has entered into any Assignment and Acceptance
after the Effective Date, set forth for such Bank as its Tranche A Commitment
in the Register maintained by the Administrative Agent pursuant to Section
9.06(c), as such amount may be reduced pursuant to Section 2.05.
"Tranche A Maturity Date" means the earlier of (a) August 19, 2001, as
such date may be extended pursuant to Section 2.01(c), provided the Tranche A
Maturity Date for any Terminating Bank shall be the date such Bank's Tranche A
Advances are payable in full pursuant to
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Section 2.01(c)(iii)(B) and (b) the earlier termination in whole of the
Commitments pursuant to Section 2.05 or Article VII.
"Tranche A Note" means a promissory note of the Borrower payable to
the order of any Bank, in substantially the form of the attached Exhibit E-1,
evidencing indebtedness of the Borrower to such Bank resulting from Tranche A
Advances owing to such Bank.
"Tranche B Advance" means any advance by a Bank to the Borrower as
part of a Tranche B Borrowing and refers to a Base Rate Advance or a Eurodollar
Rate Advance.
"Tranche B Borrowing" means a borrowing consisting of simultaneous
Tranche B Advances of the same Type made by each Bank pursuant to Section
2.01(b) or Converted by each Bank to Tranche B Advances of a different Type
pursuant to Section 2.02(b).
"Tranche B Commitment" means, for each Bank, the amount set opposite
such Bank's name on the signature pages of this Agreement as its Tranche B
Commitment or, if such Bank has entered into any Assignment and Acceptance
after the Effective Date, set forth for such Bank as its Tranche B Commitment
in the Register maintained by the Administrative Agent pursuant to Section
9.06(c), as such amount may be reduced pursuant to Section 2.05.
"Tranche B Commitment Termination Date" means the earlier of (a)
August 18, 1997 and (b) the earlier termination in whole of the Commitments
pursuant to Section 2.05 or Article VII.
"Tranche B Note" means a promissory note of the Borrower payable to
the order of any Bank, in substantially the form of the attached Exhibit E-2,
evidencing indebtedness of the Borrower to such Bank resulting from Tranche B
Advances owing to such Bank.
"Type" has the meaning set forth in Section 1.04.
"Unispec Leases" means the two Lease Agreements, each dated as of June
20, 1986, between Unispec Development Corporation and Geriatrics, Inc.
Section 1.02. Computation of Time Periods. In this Agreement in
the computation of periods of time from a specified date to a later specified
date, the word "from" means "from and including" and the words "to" and "until"
each means "to but excluding".
Section 1.03. Accounting Terms; Changes in GAAP.
(a) All accounting terms not specifically defined in this
Agreement shall be construed in accordance with GAAP applied on a consistent
basis with those applied in the
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preparation of the Financial Statements (except for changes to which the
Borrower's independent public accountants take no exception).
(b) Unless otherwise indicated, all financial statements of the
Borrower, all calculations for compliance with covenants in this Agreement, all
determinations of the Applicable Margin, and all calculations of any amounts to
be calculated under the definitions in Section 1.01 shall be based upon the
consolidated accounts of the Borrower and its Subsidiaries in accordance with
GAAP and consistent with the principles of consolidation applied in preparing
the Financial Statements (except for changes in the principles of consolidation
to which the Borrower's independent public accountants take no exception).
Section 1.04. Classes and Types of Advances. Advances are
distinguished by "Class" and "Type". The "Class" of an Advance refers to the
determination of whether such Advance is a Tranche A Advance or Tranche B
Advance, each of which constitutes a Class. The "Type" of an Advance refers to
the determination whether such Advance is a Eurodollar Rate Advance or Base
Rate Advance, each of which constitutes a Type.
Section 1.05. Miscellaneous. Article, Section, Schedule and
Exhibit references are to Articles and Sections of and Schedules and Exhibits
to this Agreement, unless otherwise specified.
ARTICLE II
THE ADVANCES AND THE LETTERS OF CREDIT
Section 2.01. Tranche A and Tranche B Advances; Extension of
Tranche A Maturity Date.
(a) Tranche A Advances. Each Bank severally agrees, on the terms
and conditions set forth in this Agreement, to make Tranche A Advances to the
Borrower from time-to-time on any Business Day during the period from the date
of this Agreement until the Tranche A Maturity Date in an aggregate amount not
to exceed at any time outstanding (i) such Bank's Tranche A Commitment less
(ii) such Bank's Pro Rata Share of the Letter of Credit Exposure at such time;
provided that, following the making of each Borrowing comprised of Tranche A
Advances, the aggregate outstanding principal amount of the Tranche A Advances,
Letter of Credit Exposure, Competitive Advances and Debt permitted under
Section 6.02(d) shall not exceed the aggregate amount of the Tranche A
Commitments. Each Tranche A Borrowing shall be in an aggregate amount not less
than (A) $500,000 and in integral multiples of $100,000.00 in excess thereof or
(B) if the aggregate outstanding amount of Tranche A Advances is $500,000.00 or
more, $100,000.00 and in integral multiples of $100,000.00 in excess thereof
and shall consist of
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Tranche A Advances of the same Type made on the same day by the Banks ratably
according to their respective Tranche A Commitments. Within the limits of each
Bank's Tranche A Commitment, the Borrower may from time-to-time borrow, prepay
pursuant to Section 2.08 and reborrow under this Section 2.01(a).
(b) Tranche B Advances. Each Bank severally agrees on the terms
and conditions set forth in this Agreement to make Tranche B Advances to the
Borrower from time-to-time on any Business Day during the period from the date
of this Agreement until the Tranche B Commitment Termination Date in an amount
equal to such Bank's Tranche B Commitment. Each Tranche B Borrowing shall be
in an aggregate amount not less than (A) $500,000.00 and in integral multiples
of $100,000.00 in excess thereof or (B) if the aggregate outstanding amount of
Tranche B Advances is $500,000.00 or more, $100,000.00 and in integral
multiples of $100,000.00 in excess thereof and shall consist of Tranche B
Advances of the same Type made on the same day by the Banks ratably according
to their respective Tranche B Commitments. Within the limits of each Bank's
Tranche B Commitment, the Borrower may from time-to-time borrow, prepay
pursuant to Section 2.08 and reborrow under this Section 2.01(b). After the
Tranche B Commitment Termination Date, no Tranche B Advances may be made other
than as Conversions or continuations pursuant to Section 2.02 of Tranche B
Advances outstanding on the Tranche B Commitment Termination Date.
(c) Extension of Tranche A Maturity Date.
(i) So long as no Default shall have occurred and be
continuing at such time, at least 90 but not more than 150 days before
each August 19 beginning August 19, 1998, the Borrower may request in
writing to the Administrative Agent and each Bank that the Banks
extend the Tranche A Maturity Date by one year. On or before the
immediately following July 1 after each such request, each Bank shall
notify the Administrative Agent and the Borrower in writing whether it
elects to so extend the Tranche A Maturity Date. Any failure by a
Bank to so notify the Administrative Agent and the Borrower shall be
deemed to be a decision by such Bank to not extend the Tranche A
Maturity Date.
(ii) If each Bank elects to extend the Tranche A Maturity
Date, the Tranche A Maturity Date shall automatically extend for one
year.
(iii) If the Majority Banks, but not all the Banks elect to
extend the Tranche A Maturity Date (A) the Tranche A Maturity Date and
the Tranche A Commitments of the Banks electing to extend shall extend
by one year, (B) the Tranche A Maturity Date for the Banks not
electing to extend (each a "Terminating Bank") shall remain unchanged
and each Terminating Bank's Tranche A Commitment shall terminate on
such Tranche A Maturity Date and the Borrower shall repay the
outstanding Tranche A Advances made by each
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Terminating Bank on such Tranche A Maturity Date to the extent that
the Tranche A Advances under such Terminating Bank's Tranche A
Commitment are not assumed pursuant to Section 2.15, (C) the Tranche A
Commitment of the Terminating Banks may be assumed and the Terminating
Banks may be replaced in accordance with the procedures in Section
2.15, and (D) if not all of the Terminating Banks' Tranche A
Commitments are assumed in accordance with Section 2.15, each
extending Bank's Pro Rata Share shall be recalculated to take into
account the termination of the Tranche A Commitments of the
Terminating Banks on the Tranche A Maturity Date for such Terminating
Banks.
(iv) If less than the Majority Banks elect to extend the
Tranche A Maturity Date, the Tranche A Maturity Date shall not be
extended for any Bank.
Section 2.02. Method of Borrowing.
(a) Notice. Each Revolving Borrowing shall be made pursuant to a
Notice of Borrowing, given not later than (i) noon (Dallas, Texas time) on the
third Business Day before the date of the proposed Borrowing, in the case of a
Eurodollar Rate Advance or (ii) 10:00 a.m. (Dallas, Texas time) on the Business
Day of the proposed Borrowing, in the case of a Base Rate Advance, by the
Borrower to the Administrative Agent, which shall give to each Bank prompt
notice and use best efforts to give notice not later than 12:00 p.m. (Dallas,
Texas time) on the day of receipt of timely Notice of Borrowing of such
proposed Borrowing by telecopier or telex. Each Notice of a Borrowing shall be
by telecopier or telex, confirmed immediately in writing specifying the
requested (i) date of such Borrowing, (ii) Type and Class of Advances
comprising such Borrowing, (iii) aggregate amount of such Borrowing, and (iv)
if such Borrowing is to be comprised of Eurodollar Rate Advances, Interest
Period for each such Advance. In the case of a proposed Borrowing comprised of
Eurodollar Rate Advances, the Administrative Agent shall promptly notify each
Bank of the applicable interest rate under Section 2.07(b). Each Bank shall
(i) in the case of all Revolving Borrowings other than Revolving Borrowings
made on the same day as the day the Notice of Borrowing is received, before
11:00 a.m. (Dallas, Texas time) on the date of such Revolving Borrowing and
(ii) in the case of Revolving Borrowings made on the same day as the date of
the Notice of Borrowing, before 1:00 p.m. (Dallas, Texas time), make available
for the account of its Applicable Lending Office to the Administrative Agent at
its address referred to in Section 9.02, or such other location as the
Administrative Agent may specify by notice to the Banks, in same day funds,
such Bank's Pro Rata Share of such Revolving Borrowing. After the
Administrative Agent's receipt of such funds and upon fulfillment of the
applicable conditions set forth in Article III, the Administrative Agent will
make such funds available to the Borrower at its account with the
Administrative Agent.
(b) Conversions and Continuations. In order to elect to Convert
or continue an Advance under this Section, the Borrower shall deliver an
irrevocable Notice of Conversion or
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Continuation to the Administrative Agent at the Administrative Agent's office
no later than (i) 11:00 a.m. (Dallas, Texas time) on the Business Day of the
proposed conversion date in the case of a Conversion to a Base Rate Advance and
(ii) no later than noon (Dallas, Texas time) three Business Days in advance of
the proposed Conversion or continuation date in the case of a Conversion to, or
a continuation of, a Eurodollar Rate Advance. Each such Notice of Conversion
or Continuation shall be in writing or by telex or telecopier, confirmed
immediately in writing specifying (i) the requested Conversion or continuation
date (which shall be a Business Day), (ii) the amount, Type, and Class of the
Advance to be Converted or continued, (iii) whether a Conversion or
continuation is requested, and if a Conversion, into what Type of Advance, and
(iv) in the case of a Conversion to, or a continuation of, a Eurodollar Rate
Advance, the requested Interest Period. Promptly after receipt of a Notice of
Conversion or Continuation under this paragraph, the Administrative Agent shall
provide each Bank with a copy thereof and, in the case of a Conversion to or a
Continuation of a Eurodollar Rate Advance, notify each Bank of the applicable
interest rate under Section 2.07(b). For purposes other than the making of
deemed representations and warranties pursuant to Section 3.02, the portion of
Advances comprising part of the same Borrowing that are converted to Advances
of another Type shall constitute a new Revolving Borrowing.
(c) Certain Limitations. Notwithstanding anything in paragraphs
(a) and (b) above:
(i) at no time shall there be more than eight Interest
Periods applicable to outstanding Eurodollar Rate Advances;
(ii) the Borrower may not select Eurodollar Rate Advances
for any Revolving Borrowing if the aggregate amount of such Revolving
Borrowing is less than $5,000,000.00 or at any time when a Default has
occurred and is continuing;
(iii) (A) if any Bank shall, at least one Business Day
before the date of any requested Revolving Borrowing, notify the
Administrative Agent that the introduction of or any change in or in
the interpretation of any law or regulation makes it unlawful, or that
any central bank or other Governmental Authority asserts that it is
unlawful, for such Bank or its Eurodollar Lending Office to perform
its obligations under this Agreement to make Eurodollar Rate Advances
or to fund or maintain Eurodollar Rate Advances, the right of the
Borrower to select Eurodollar Rate Advances for such Bank's Advances
included in such Borrowing or for such Bank's Advances included in any
subsequent Revolving Borrowing shall be suspended until such Bank
shall notify the Administrative Agent that the circumstances causing
such suspension no longer exist, and such Bank's Advances included in
such Revolving Borrowing shall be a Base Rate Advance; (B) such Bank
agrees to use commercially reasonable efforts (consistent with its
internal policies and legal and regulatory restrictions) to designate
a different Applicable Lending Office if the making of such
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designation would avoid the effect of this paragraph and would not, in
the reasonable judgment of such Bank, be otherwise materially
disadvantageous to such Bank; and (C) if such condition shall continue
for such Bank for 60 days, such Bank may be replaced in accordance
with the procedures in Section 2.15;
(iv) if the Administrative Agent is unable to determine
the Eurodollar Rate Advances comprising any requested Revolving
Borrowing, the right of the Borrower to select Eurodollar Rate
Advances for such Revolving Borrowing or for any subsequent Revolving
Borrowing shall be suspended until the Administrative Agent shall
notify the Borrower and the Banks that the circumstances causing such
suspension no longer exist, and each Advance comprising such Revolving
Borrowing shall be a Base Rate Advance;
(v) (A) if any Bank shall, at least one Business Day
before the date of any requested Revolving Borrowing, notify the
Administrative Agent that the Eurodollar Rate for such Bank's
Eurodollar Rate Advance included in such Revolving Borrowing will not
adequately reflect the cost to such Bank of making or funding its
Eurodollar Rate Advance included in such Revolving Borrowing, the
right of the Borrower to select a Eurodollar Rate Advance from such
Bank for such Revolving Borrowing or for any subsequent Revolving
Borrowing shall be suspended until such Bank shall notify the Borrower
and the Banks that the circumstances causing such suspension no longer
exist, and such Bank's Advance included in such Revolving Borrowing
shall be a Base Rate Advance; (B) such Bank agrees to use commercially
reasonable efforts (consistent with its internal policies and legal
and regulatory restrictions) to designate a different Applicable
Lending Office if the making of such designation would avoid the
effect of this paragraph and would not, in the reasonable judgment of
such Bank, be otherwise materially disadvantageous to such Bank; and
(C) if such condition shall continue for such Bank for 60 days, such
Bank may be replaced in accordance with the procedures in Section
2.15; and
(vi) if the Borrower shall fail to select the duration or
continuation of any Interest Period for any Eurodollar Advances in
accordance with the provisions contained in the definition of
"Interest Period" in Section 1.01 and paragraph (b) above, the
Administrative Agent will forthwith so notify the Borrower and the
Banks and such Advances will be made available to the Borrower on the
date of such Revolving Borrowing as Base Rate Advances or, if an
existing Advance, Convert into Base Rate Advances.
(d) Notices Irrevocable. Each Notice of Borrowing and Notice of
Conversion or Continuation shall be irrevocable and binding on the Borrower.
In the case of any Revolving Borrowing which the related Notice of Borrowing
specifies is to be comprised of Eurodollar Rate Advances, the Borrower shall
indemnify each Bank against any loss, out- of-pocket cost or expense actually
incurred by such Bank as a result of any failure to fulfill on or before the
date
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specified in such Notice of Borrowing for such Revolving Borrowing the
applicable conditions set forth in Article III, or any other failure to Convert
such Advances to Eurodollar Rate Advances on the applicable date for Conversion
or continuation, including, without limitation, any loss cost or expense
actually incurred by reason of the liquidation or reemployment of deposits or
other funds acquired by such Bank to fund the Advance to be made by such Bank
as part of such Revolving Borrowing when such Advance, as a result of such
failure, is not made on such date.
(e) Administrative Agent Reliance. Unless the Administrative
Agent shall have received notice from a Bank before the date of any Revolving
Borrowing that such Bank will not make available to the Administrative Agent
such Bank's Pro Rata Share of such Revolving Borrowing, the Administrative
Agent may assume that such Bank has made its Pro Rata Share of such Revolving
Borrowing available to the Administrative Agent on the date of such Revolving
Borrowing in accordance with paragraph (a) of this Section 2.02 and the
Administrative Agent may, in reliance upon such assumption, make available to
the Borrower on such date a corresponding amount. If and to the extent that
such Bank shall not have so made its Pro Rata Share of such Revolving Borrowing
available to the Administrative Agent, such Bank and the Borrower severally
agree to immediately repay to the Administrative Agent on demand such
corresponding amount, together with interest on such amount, for each day from
the date such amount is made available to the Borrower until the date such
amount is repaid to the Administrative Agent, at (i) in the case of the
Borrower, the interest rate applicable on such day to Advances comprising such
Revolving Borrowing and (ii) in the case of such Bank, the Federal Funds Rate
for such day. If such Bank shall repay to the Administrative Agent such
corresponding amount and interest as provided above, such corresponding amount
so repaid shall constitute such Bank's Advance as part of such Revolving
Borrowing for purposes of this Agreement even though not made on the same day
as the other Advances comprising such Revolving Borrowing.
(f) Bank Obligations Several. The failure of any Bank to make the
Advance to be made by it as part of any Revolving Borrowing shall not relieve
any other Bank of its obligation, if any, to make its Advance on the date of
such Revolving Borrowing. No Bank shall be responsible for the failure of any
other Bank to make the Advance to be made by such other Bank on the date of any
Revolving Borrowing.
(g) Notes. The indebtedness of the Borrower to each Bank
resulting from Tranche A Advances owing to such Bank shall be evidenced by a
Tranche A Note of the Borrower payable to the order of such Bank in
substantially the form of Exhibit E-1. The indebtedness of the Borrower to
each Bank resulting from Tranche B Advances owing to such Bank shall be
evidenced by a Tranche B Note of the Borrower payable to the order of such Bank
in substantially the form of Exhibit E-2.
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Section 2.03. Competitive Advances.
(a) Generally. Each Bank severally agrees that the Borrower may
request Competitive Borrowings under this Section 2.03 from time to time on any
Business Day during the period from the date hereof until the date occurring 30
days prior to the Tranche A Maturity Date in the manner set forth below;
provided that, following the making of each Competitive Borrowing, the
aggregate outstanding principal amount of the Tranche A Advances, Letter of
Credit Exposure, Competitive Advances and Debt permitted under Section 6.02(d)
shall not exceed the aggregate amount of the Tranche A Commitments. Within the
limits and on the conditions set forth in this Section 2.03, the Borrower may
from time to time borrow pursuant to paragraph (b) below, prepay and repay
pursuant to Section 2.08 below, and reborrow under this Section 2.03. The
Competitive Advances made by each Bank shall be evidenced by a Competitive
Advance Note in the aggregate amount of the Tranche A Commitments and payable
to the order of such Bank.
(b) Method of Advancing.
(i) The Borrower may request a Competitive Borrowing by
delivering to the Administrative Agent a Competitive Bid Request (A)
in the case of a Competitive Borrowing consisting of Eurodollar
Auction Advances not later than 11:00 a.m. (Dallas, Texas time) four
Business Days before the proposed date of such Borrowing and (B) in
the case of a Competitive Borrowing consisting of Fixed Rate Auction
Advances, not later than 10:00 a.m. (Dallas, Texas time) one Business
Day before the proposed day of such Borrowing. Without the prior
approval of the Administrative Agent, no Competitive Borrowing may be
requested within five Business Days after the delivery of any other
Competitive Bid Request and no more than three Competitive Bid
Requests may be delivered in any calendar month. A Competitive Bid
Request that does not conform substantially to the form of Exhibit G-1
may be rejected by the Administrative Agent and the Administrative
Agent shall promptly notify the Borrower of such rejection. Each
Competitive Bid Request shall specify (1) whether the Borrowing being
requested is to consist of Eurodollar Auction Advances or Fixed Rate
Auction Advances; (2) the date of such Borrowing (which shall be a
Business Day); (3) the aggregate principal amount of such Borrowing,
which shall be a minimum of $5,000,000.00 and in integral multiples of
$1,000,000.00; and (4) the Interest Period with respect thereto.
Promptly after its receipt of a Competitive Bid Request that is not
rejected, the Administrative Agent shall by telecopy in the form set
forth in Exhibit G-2 invite the Banks to bid to make Competitive
Advances pursuant to the Competitive Bid Request.
(ii) Each Bank may, in its sole discretion, make one or
more Competitive Bids to the Borrower as part of such proposed
Competitive Borrowing. Each Competitive Bid by a Bank must be received
by the Administrative Agent by telecopy in the form of Exhibit X-
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00
0, (X) in the case of a Competitive Borrowing comprised of Eurodollar
Auction Advances, not later than 9:00 a.m. (Dallas, Texas time) three
Business Days before the proposed date of such Competitive Borrowing,
and (B) in the case of a Competitive Borrowing comprised of Fixed
Rate Auction Advances, not later than 9:00 a.m. (Dallas, Texas time)
on the proposed date of such Competitive Borrowing. Competitive Bids
that do not conform substantially to the form of Exhibit G-3 may be
rejected by the Administrative Agent, and the Administrative Agent
shall promptly notify the applicable Bank of such rejection. Each
Competitive Bid shall specify (1) the principal amount, which shall be
a minimum of $5,000,000.00 and in integral multiples of $1,000,000.00,
and may equal the entire principal amount of the Competitive Borrowing
requested, of the Competitive Advance or Advances that the Bank is
willing to make to the Borrower, (2) the Competitive Bid Rate or Rates
at which the Bank is prepared to make such Advance or Advances, and
(3) the Interest Period applicable to such Advance or Advances and the
last day thereof. Any Bank which has not responded to the
Administrative Agent prior to the time specified above shall be deemed
to have elected to decline to make such an offer. A Competitive Bid
submitted by a Bank pursuant to this subsection (ii) shall be
irrevocable. If the Administrative Agent shall elect to submit a
Competitive Bid in its capacity as a Bank, it shall submit such
Competitive Bid directly to the Borrower at least one quarter of an
hour earlier than the time by which the other Banks are required to
submit their Competitive Bids to the Administrative Agent pursuant to
this paragraph (ii).
(iii) The Administrative Agent shall promptly notify the
Borrower by telecopy of the Competitive Bid Rate and the principal
amount of each Competitive Bid in respect of which a Competitive Bid
shall have been made and the identity of the Bank that shall have made
each bid.
(iv) The Borrower shall before 10:00 a.m. (Dallas, Texas
time) at least three Business Days prior to the date of the proposed
Competitive Borrowing, with respect to Competitive Borrowings to be
comprised of Eurodollar Auction Advances, and on the Business Day of
the proposed Competitive Borrowing to be comprised of Fixed Rate
Auction Advances, either (A) cancel such Competitive Borrowing by
giving the Administrative Agent notice to that effect, or (B) accept
one or more of the Competitive Bids made by any Bank or Banks by
giving the Administrative Agent a Notice of Acceptance/Rejection
stating the amount of the Competitive Advances offered by the Banks
which the Borrower has accepted and of the rejection of the remaining
Competitive Bids made by the Banks. The failure of the Borrower to
give such timely notice shall be deemed to be a rejection of each
Competitive Bid. Any Notice of Acceptance/Rejection that does not
substantially conform to the form of Exhibit G-4 may be rejected by
the Administrative Agent by delivering prompt notice of the rejection
to the Borrower. If the Borrower elects to accept any Competitive
Bids, the resulting Competitive Borrowing must be in an aggregate
principal
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amount of not less than $5,000,000.00 and in integral multiples of
$1,000,000.00 or an aggregate principal amount equal to the remaining
balance of the available commitments and cannot exceed the principal
amount specified in the relevant Competitive Bid Request. The
Borrower shall not accept a Competitive Bid made at a particular
Competitive Bid Rate if the Borrower has decided to reject a
Competitive Bid made at a lower Competitive Bid Rate. If the Borrower
shall accept a Competitive Bid or Bids made at a particular
Competitive Bid Rate but the amount of such Competitive Bid or Bids
would cause the total amount to be accepted by the Borrower to exceed
the amount specified in the Competitive Bid Request, then the Borrower
shall accept a portion of such Competitive Bid or Bids in an amount
equal to the amount specified in the Competitive Bid Request less the
amount of all other Competitive Bids so accepted, which acceptance, in
the case of multiple Competitive Bids at such Competitive Bid Rate,
shall be made pro rata in accordance with the amount of each such Bid.
If a Competitive Advance must be in an amount less than $5,000,000.00
because of the provisions above, such Competitive Advance may be for a
minimum of $1,000,000.00 or any integral multiple thereof, and in
calculating the pro rata allocation of acceptances of portions of
multiple bids at a particular Competitive Bid Rate, the amounts shall
be rounded to integral multiples of $1,000,000.00 in a manner which
shall be in the discretion of the Borrower. A notice given by the
Borrower pursuant to this paragraph (iv) shall be irrevocable.
(v) The Administrative Agent shall promptly notify each
bidding Bank by telecopy whether or not its Competitive Bid has been
accepted, and, if so, in what amount and at what Competitive Bid Rate,
and each successful bidder will thereupon become bound, upon the terms
and subject to the conditions hereof, to make the Competitive Advance
in respect of which its Competitive Bid has been accepted in the
amount so specified by the Administrative Agent. The Administrative
Agent shall thereafter promptly notify each Bank of the amount of each
Competitive Advance. Each Bank that is to make a Competitive Advance
as part of such Competitive Borrowing shall, before 2:00 p.m. (Dallas,
Texas time) on the date of such Competitive Borrowing specified in the
notice received from the Administrative Agent, make available to the
Administrative Agent at its address referred to in Section 9.02 such
Bank's Competitive Advance, in immediately available funds. Upon
fulfillment of the applicable conditions set forth herein and, except
as specified in paragraph (vi) below, after receipt by the
Administrative Agent of such funds, the Administrative Agent shall
make such funds available to the Borrower at its account with the
Administrative Agent.
(vi) Unless the Administrative Agent shall have received
notice from a Bank prior to the date of any Competitive Borrowing that
such Bank shall not make available to the Administrative Agent such
Bank's Competitive Advance, the Administrative Agent may assume that
such Bank has made such Advance available to the Administrative Agent
on the
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date of such Competitive Borrowing in accordance with paragraph (a) of
this Section 2.03 and the Administrative Agent may, in reliance upon
such assumption, make available to the Borrower on such date a
corresponding amount. If and to the extent that such Bank shall not
have so made its Competitive Advance available to the Administrative
Agent, such Bank and the Borrower severally agree to immediately repay
to the Administrative Agent on demand such corresponding amount,
together with interest on such amount, for each day from the date such
amount is made available to the Borrower until the date such amount is
repaid to the Administrative Agent, at (A) in the case of the
Borrower, the interest rate applicable on such day to Competitive
Advances comprising such Competitive Borrowing and (B) in the case of
such Bank, the Federal Funds Rate for such day. If such Bank shall
repay to the Administrative Agent such corresponding amount and
interest as provided above, such corresponding amount so repaid shall
constitute such Bank's Competitive Advance as part of such Competitive
Borrowing for purposes of this Agreement even though not made on the
same day as the other Advances comprising such Competitive Borrowing.
Section 2.04. Fees.
(a) Facility Fees.
(i) The Borrower agrees to pay to the
Administrative Agent for the account of each Bank a facility
fee on the amount of such Bank's Tranche A Commitment from the
date of this Agreement until the Tranche A Maturity Date at
the rate equal to the Applicable Margin for facility fees for
Tranche A Advances during such period. The fee payable
pursuant to this clause (i) is due quarterly in arrears on the
first day of each January, April, July, and October commencing
October 1, 1996 and on the Tranche A Maturity Date.
(ii) The Borrower agrees to pay to the
Administrative Agent for the account of each Bank a facility
fee on the amount of such Bank's Tranche B Commitment from the
date of this Agreement until the Tranche B Commitment
Termination Date at the rate equal to the Applicable Margin
for facility fees for Tranche B Advances during such period.
The fee payable pursuant to this clause (ii) is due quarterly
in arrears on the first day of each January, April, July, and
October commencing October 1, 1996 and on the Tranche B
Commitment Termination Date.
(b) Agents' Fees. The Borrower agrees to pay to the
Administrative Agent, the Documentation Agent and the Syndication Agent the
syndication, agent and other fees and expenses described in the letters dated
June 3, 1996 from the Borrower on the dates required by such letters.
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(c) Letter of Credit Fees. The Borrower agrees to pay (i) to the
Administrative Agent for the pro rata benefit of the Banks, a fee per annum for
each Letter of Credit equal to the Applicable Margin for Eurodollar Rate
Advances of the face amount of such Letter of Credit and (ii) to such Issuing
Bank, a fee for each Letter of Credit of 1/8% per annum of the face amount of
such Letter of Credit. Each such fee shall be based on the maximum amount
available to be drawn under such Letter of Credit from the date of issuance of
the Letter of Credit until its Expiration Date and be payable quarterly in
advance on the date of the issuance of the Letter of Credit for the period from
such date until the end of the calendar quarter in which such Letter of Credit
is issued and on the first day of each January, April, July, and October
thereafter until its Expiration Date.
Section 2.05. Reduction of the Commitments. (a) The Borrower shall
have the right, upon at least three Business Days' irrevocable notice to the
Administrative Agent, to terminate in whole or reduce ratably in part the
unused portion of the Tranche A Commitments or the Tranche B Commitments;
provided that each partial reduction shall be in the aggregate amount of
$5,000,000.00 or an integral multiple of $1,000,000.00.
(b) The Tranche A Commitments shall automatically reduce on the
first anniversary of any Nonordinary Course Asset Sale, by an amount equal to
the Net Cash Proceeds received by the Borrower or any of its Subsidiaries from
such Nonordinary Course Asset Sale, the proceeds of which are not used for
Acquisition Expenditures within one year from the date of the Nonordinary
Course Asset Sale. For purposes of this paragraph (b), the Net Cash Proceeds
from a Nonordinary Course Asset Sale will be deemed to be used to make the
first Acquisition Expenditures made during the one-year period after the date
of such Nonordinary Course Asset Sale.
(c) Any reduction or termination of the Commitments pursuant to
this Section 2.05 shall be permanent, with no obligation of the Banks to
reinstate such Commitments and the facility fees provided for in Section
2.04(a)(i) shall thereafter be computed on the basis of the Commitments, as so
reduced.
Section 2.06. Repayment.
(a) Tranche A Advances. The Borrower shall repay the outstanding
principal amount of each Tranche A Advance on the Tranche A Maturity Date.
(b) Tranche B Advances. The Borrower shall repay the outstanding
principal amount of each Tranche B Advance on the Tranche B Commitment
Termination Date or ratably based on each Bank's Pro Rata Share in 15
installments of 1/16th of the aggregate principal amount of the Tranche B
Advances outstanding on August 18, 1997, each such installment payable on the
first
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day of each calendar quarter beginning with October 1, 1997 and a final
installment equal to the outstanding principal amount of the Tranche B Advances
payable on July 1, 2001.
(c) Competitive Advances. The Borrower shall repay to the
Administrative Agent for the account of each Bank which has made a Competitive
Advance to the Borrower on the maturity date of each Competitive Advance (such
maturity date being that specified by the Borrower for repayment of such
Competitive Advance in the related Notice of Acceptance/Rejection delivered
pursuant to Section 2.03 above) the then unpaid principal amount of such
Competitive Advance.
Section 2.07. Interest. The Borrower shall pay interest on the
unpaid principal amount of each Advance made by each Bank from the date of such
Advance until such principal amount shall be paid in full, at the following
rates per annum:
(a) Base Rate Advances. If such Advance is a Base Rate Advance, a
rate per annum equal at all times to the lesser of (i) the Adjusted Base Rate
in effect from time-to-time plus the Applicable Margin and (ii) the Maximum
Rate, payable in arrears on the last day of each calendar quarter and on the
date such Base Rate Advance shall be paid in full, provided that any amount of
principal which is not paid when due (whether at stated maturity, by
acceleration or otherwise) shall bear interest from the date on which such
amount is due until such amount is paid in full, payable on demand, at a rate
per annum equal at all times to the lesser of (i) the Adjusted Base Rate in
effect from time-to-time plus the Applicable Margin plus 2% and (ii) the
Maximum Rate.
(b) Eurodollar Rate Advances. If such Advance is a Eurodollar
Rate Advance, a rate per annum equal at all times during the Interest Period
for such Advance to the lesser of (i) the Eurodollar Rate for such Interest
Period plus the Applicable Margin and (ii) the Maximum Rate, payable on the
last day of such Interest Period, and, in the case of six-month Interest
Periods, on the day which occurs during such Interest Period three months from
the first day of such Interest Period; provided that any amount of principal
which is not paid when due (whether at stated maturity, by acceleration or
otherwise) shall bear interest from the date on which such amount is due until
such amount is paid in full, payable on demand, at a rate per annum equal at
all times to the lesser of (i) rate required to be paid on such Advance
immediately prior to the date on which such amount became due plus 2% and (ii)
the Maximum Rate.
(c) Eurodollar Auction Advances. If such Advance is a Eurodollar
Auction Advance, a rate per annum equal at all times during the Interest Period
for such Advance to the lesser of (i) the sum of the Eurodollar Rate for the
Interest Period in effect for such Advance plus the Margin offered by the Bank
making such Advance and accepted by the Borrower pursuant to Section 2.03(b)
and (ii) the Maximum Rate, payable on the last day of such Interest Period,
and, in the case of six-month Interest Periods, on the day which occurs during
such Interest Period three
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months from the first day of such Interest Period; provided that any amount of
principal which is not paid when due (whether at stated maturity, by
acceleration or otherwise) shall bear interest from the date on which such
amount is due until such amount is paid in full, payable on demand, at a rate
per annum equal at all times to the lesser of (i) the rate required to be paid
on such Advance immediately prior to the date on which such amount became due
plus 2% and (ii) the Maximum Rate.
(d) Fixed Rate Auction Advances. If such Advance is a Fixed Rate
Auction Advance, a rate per annum equal at all times during the Interest Period
for such Advance to the lesser of (i) the fixed rate of interest offered by the
Bank making such Advance and accepted by the Borrower pursuant to Section
2.03(b) and (ii) the Maximum Rate, payable on the last day of such Interest
Period and, in the case of Interest Periods longer than three months, on the
day which occurs during such Interest Period three months from the first day of
such Interest Period and every three months thereafter; provided that any
amount of principal which is not paid when due (whether at stated maturity, by
acceleration or otherwise) shall bear interest from the date on which such
amount is due until such amount is paid in full, payable on demand, at a rate
per annum equal at all times to the lesser of (i) the rate required to be paid
on such Advance immediately prior to the date on which such amount became due
plus 2% and (ii) the Maximum Rate.
(e) Additional Interest on Eurodollar Advances. The Borrower
shall pay to each Bank, so long as any such Bank shall be required under
regulations of the Federal Reserve Board to maintain reserves with respect to
liabilities or assets consisting of or including Eurocurrency Liabilities,
additional interest on the unpaid principal amount of each Eurodollar Advance
of such Bank, from the later of (i) the date of such Advance and (ii) the date
such reserve requirement is imposed until the earlier of (A) the date such
principal amount is paid in full and (B) the date such reserve requirement is
suspended, at an interest rate per annum equal at all times to the remainder
obtained by subtracting (1) the Eurodollar Rate for the Interest Period for
such Advance from (2) the rate obtained by dividing such Eurodollar Rate by a
percentage equal to 100% minus the Eurodollar Rate Reserve Percentage of such
Bank for such Interest Period, payable on each date on which interest is
payable on such Advance. Such additional interest payable to any Bank shall be
determined by such Bank and notified to the Borrower through the Administrative
Agent (such notice to include the calculation of such additional interest,
which calculation shall be conclusive in the absence of manifest error). Each
Bank agrees to use commercially reasonable efforts (consistent with its
internal policy and legal and regulatory restrictions) to designate a different
Applicable Lending Office if the making of such a designation would avoid the
effect of this paragraph and would not, in the reasonable judgment of such
Bank, be otherwise materially disadvantageous to such Bank.
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(f) Usury Recapture. In the event the rate of interest chargeable
under this Agreement or the Notes at any time is greater than the Maximum Rate,
the unpaid principal amount of the Notes shall bear interest at the Maximum
Rate until the total amount of interest paid or accrued on the Notes equals the
amount of interest which would have been paid or accrued on the Notes if the
stated rates of interest set forth in this Agreement had at all times been in
effect.
In the event, upon payment in full of the Notes, the total
amount of interest paid or accrued under the terms of this Agreement and the
Notes is less than the total amount of interest which would have been paid or
accrued if the rates of interest set forth in this Agreement had, at all times,
been in effect, then the Borrower shall, to the extent permitted by applicable
law, pay the Administrative Agent for the account of the Banks an amount equal
to the difference between (i) the lesser of (A) the amount of interest which
would have been charged on the Notes if the Maximum Rate had, at all times,
been in effect and (B) the amount of interest which would have accrued on the
Notes if the rates of interest set forth in this Agreement had at all times
been in effect and (ii) the amount of interest actually paid or accrued under
this Agreement on the Notes.
In the event the Banks ever receive, collect or apply as
interest any sum in excess of the Maximum Rate, such excess amount shall, to
the extent permitted by law, be applied to the reduction of the principal
balance of the Notes, and if no such principal is then outstanding, such excess
or part thereof remaining shall be paid to the Borrower.
Section 2.08. Prepayments.
(a) Right to Prepay. The Borrower shall have no right to prepay
any principal amount of any Advance except as provided in this Section 2.08.
(b) Optional. The Borrower may elect to prepay any of the
Advances, after giving (i) by 9:00 a.m. (Dallas, Texas time) in the case of
Eurodollar Advances, at least two Business Days' or (ii) by 11:00 a.m. (Dallas,
Texas time) in case of Base Rate Advances or Fixed Rate Auction Advances, same
Business Day's prior written notice to the Administrative Agent stating the
proposed date and aggregate principal amount of such prepayment, whether such
prepayment should be applied to reduce outstanding Tranche A Advances, Tranche
B Advances, or Competitive Advances and, if applicable, the relevant Interest
Period for the Advances to be repaid. If any such notice is given, the
Borrower shall prepay Advances comprising part of the same Borrowing in whole
or ratably in part in an aggregate principal amount equal to the amount
specified in such notice, together with accrued interest to the date of such
prepayment on the principal amount prepaid and amounts, if any, required to be
paid pursuant to Section 2.09 as a result of such prepayment being made on such
date; provided, however, that each partial
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prepayment shall be in an aggregate principal amount in integral multiples of
$1,000,000.00 so long as $5,000,000.00 in principal is outstanding.
(c) Mandatory.
(i) On any date on which the outstanding principal amount
of the Tranche A Advances plus the outstanding principal amount of the
Competitive Advances plus the Letter of Credit Exposure plus the
outstanding principal amount of all Debt permitted under Section
6.02(d) exceeds the Tranche A Commitment, the Borrower agrees to make
a prepayment of the Tranche A Advances and, if the Tranche A Advances
have been repaid in full or are paid in full in connection with such
prepayment, of the Competitive Advances in the amount of such excess.
(ii) Before the Tranche B Commitment Termination Date, on
the date of each reduction of the aggregate Tranche B Commitments
pursuant to Section 2.05, the Borrower agrees to make a prepayment in
respect of the outstanding amount of Tranche B Advances to the
extent, if any, that the aggregate unpaid principal amount of all
Tranche B Advances exceeds the Tranche B Commitment, as so reduced.
(iii) Each prepayment pursuant to this Section 2.08(c)
shall be accompanied by accrued interest on the amount prepaid to the
date of such prepayment and amounts, if any, required to be paid
pursuant to Section 2.09 as a result of such prepayment being made on
such date.
(d) Application of Prepayments. Each prepayment of Tranche B
Advances made after the Tranche B Commitment Termination Date shall be applied
to future scheduled Tranche B Advance principal payments, at the Borrower's
option, (i) in the inverse order of their maturity or (ii) pro rata.
(e) Illegality. If any Bank shall notify the Administrative Agent
and the Borrower that the introduction of or any change in or in the
interpretation of any law or regulation makes it unlawful, or that any central
bank or other Governmental Authority asserts that it is unlawful for such Bank
or its Eurodollar Lending Office to perform its obligations under this
Agreement to maintain any Eurodollar Advances of such Bank then outstanding
hereunder, (i) the Borrower shall, no later than 11:00 a.m. (Dallas, Texas
time), (A) if not prohibited by law or regulation to maintain such Eurodollar
Advances for the duration of the Interest Period, on the last day of the
Interest Period for each outstanding Eurodollar Advance or (B) if prohibited by
law or regulation to maintain such Eurodollar Advances for the duration of the
Interest Period, on the second Business Day following its receipt of such
notice, prepay all of the Eurodollar Advances of such Bank then outstanding,
together with accrued interest on the principal amount prepaid to
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the date of such prepayment, (ii) such Bank shall simultaneously make a Base
Rate Advance or Fixed Rate Auction Advance, as applicable, to the Borrower on
such date in an amount equal to the aggregate principal amount of the
Eurodollar Advances prepaid to such Bank, and (iii) the right of the Borrower
to select Eurodollar Advances for any subsequent Borrowing from such Bank shall
be suspended until such Bank shall notify the Administrative Agent that the
circumstances causing such suspension no longer exist. Each Bank agrees to use
commercially reasonable efforts (consistent with its internal policies and
legal and regulatory restrictions) to designate a different Applicable Lending
Office if the making of such designation would avoid the effect of this
paragraph and would not, in the reasonable judgment of such Bank, be otherwise
materially disadvantageous to such Bank. If the condition requiring the
prepayment under this paragraph shall continue for such Bank for 60 days, such
Bank may be replaced in accordance with the procedures in Section 2.15.
(f) Ratable Payments; Effect of Notice. Each payment of any
Advance pursuant to this Section 2.08 or any other provision of this Agreement
shall be made in a manner such that all Advances comprising part of the same
Borrowing are paid in whole or ratably in part. All notices given pursuant to
this Section 2.08 shall be irrevocable and binding upon the Borrower.
Section 2.09. Breakage Costs. If (a) any payment of principal of
any Eurodollar Advance is made other than on the last day of the Interest
Period for such Advance, except as a result of Section 2.08(e) or (b) the
Borrower fails to make a principal or interest payment with respect to any
Eurodollar Advance on the date such payment is due and payable, the Borrower
shall, within 10 days of any written demand sent by any Bank to the Borrower
through the Administrative Agent, pay to the Administrative Agent for the
account of such Bank any amounts (without duplication of any other amounts
payable in respect of breakage costs) required to compensate such Bank for any
additional losses, out-of-pocket costs or expenses which it may reasonably
incur as a result of such payment or nonpayment, including, without limitation,
any loss, cost or expense actually incurred by reason of the liquidation or
reemployment of deposits or other funds acquired by any Bank to fund or
maintain such Advance.
Section 2.10. Increased Costs.
(a) Eurodollar Advances. If, due to either (i) the introduction
of or any change (other than any change by way of imposition or increase of
reserve requirements included in the Eurodollar Rate Reserve Percentage) in or
in the interpretation of any law or regulation 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), there shall be any increase in the
cost to any Bank of agreeing to make or making, funding or maintaining
Eurodollar Advances, then the Borrower shall from time-to-time, upon demand by
such Bank (with a copy of such demand to the Administrative Agent), immediately
pay to the Administrative Agent for the account of such
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Bank additional amounts (without duplication of any other amounts payable in
respect of increased costs) sufficient to compensate such Bank for such
increased cost; provided, however, that, before making any such demand, each
Bank agrees to use commercially reasonable efforts (consistent with its
internal policy and legal and regulatory restrictions) to designate a different
Applicable Lending Office if the making of such a designation would avoid the
need for, or reduce the amount of, such increased cost and would not, in the
reasonable judgment of such Bank, be otherwise materially disadvantageous to
such Bank. A certificate as to the amount of such increased cost and detailing
the calculation of such cost submitted to the Borrower and the Administrative
Agent by such Bank shall be conclusive and binding for all purposes, absent
manifest error. If the condition requiring payment under this paragraph shall
continue for a Bank for 60 days, such Bank may be replaced in accordance with
the procedures in Section 2.15.
(b) Capital Adequacy. If any Bank or the Issuing Bank determines
in good faith that compliance with any law or regulation or any guideline or
request from any central bank or other Governmental Authority (whether or not
having the force of law) implemented or effective after the date of this
Agreement affects or would affect the amount of capital required or expected to
be maintained by such Bank or the Issuing Bank or any corporation controlling
such Bank or the Issuing Bank and that the amount of such capital is increased
by or based upon the existence of such Bank's commitment to lend or the Issuing
Bank's commitment to issue the Letters of Credit and other commitments of this
type, then, upon 30 days prior written notice by such Bank or the Issuing Bank
(with a copy of any such demand to the Administrative Agent), the Borrower
shall immediately pay to the Administrative Agent for the account of such Bank
or to the Issuing Bank, as the case may be, from time-to-time as specified by
such Bank or the Issuing Bank, additional amounts (without duplication of any
other amounts payable in respect of increased costs) sufficient to compensate
such Bank or the Issuing Bank, in light of such circumstances, (i) with respect
to such Bank, to the extent that such Bank reasonably determines such increase
in capital to be allocable to the existence of such Bank's commitment to lend
under this Agreement and (ii) with respect to the Issuing Bank, to the extent
that the Issuing Bank reasonably determines such increase in capital to be
allocable to the issuance or maintenance of the Letters of Credit. A
certificate as to such amounts and detailing the calculation of such amounts
submitted to the Borrower by such Bank or the Issuing Bank shall be conclusive
and binding for all purposes, absent manifest error. The Borrower shall not be
obligated to compensate any Bank or the Issuing Bank pursuant to this paragraph
(b) for reduced return accruing prior to the date which is 90 days before such
Bank or the Issuing Bank requests compensation; provided that if any law, rule
or regulation, or interpretation or administration thereof, or any request or
directive giving rise to reduced returns has retroactive effect, such Bank or
the Issuing Bank shall be entitled to claim compensation under this paragraph
for the period commencing on such date of retroactive effect through the date
of adoption or change or promulgation thereof without regard to the foregoing
limitation. If the condition requiring
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payment under this paragraph shall continue for a Bank for 60 days, such Bank
may be replaced in accordance with the procedures in Section 2.15.
(c) Letters of Credit. If any change in any law or regulation or
in the interpretation thereof by any court or administrative or Governmental
Authority charged with the administration thereof shall either (i) impose,
modify, or deem applicable any reserve, special deposit, or similar requirement
against letters of credit issued by, or assets held by, or deposits in or for
the account of, the Issuing Bank or (ii) impose on the Issuing Bank any other
condition regarding the provisions of this Agreement relating to the Letters of
Credit or any Letter of Credit Obligations, and the result of any event
referred to in the preceding clause (i) or (ii) shall be to increase the cost
to the Issuing Bank of issuing or maintaining any Letter of Credit (which
increase in cost shall be determined by the Issuing Bank's reasonable
allocation of the aggregate of such cost increases resulting from such event),
then, upon demand by the Issuing Bank, the Borrower shall pay to the Issuing
Bank, from time-to-time as specified by the Issuing Bank, additional amounts
which shall be sufficient to compensate the Issuing Bank for such increased
cost. The Issuing Bank agrees to use commercially reasonable efforts
(consistent with internal policy and legal and regulatory restrictions) to
designate a different Applicable Lending Office for the booking of its Letters
of Credit if the making of such designation would avoid the effect of this
paragraph and would not, in the reasonable judgment of the Issuing Bank, be
otherwise materially disadvantageous to the Issuing Bank. A certificate as to
such increased cost incurred by the Issuing Bank, as a result of any event
mentioned in clause (i) or (ii) above, and detailing the calculation of such
increased costs submitted by the Issuing Bank to the Borrower, shall be
conclusive and binding for all purposes, absent manifest error. If the
condition requiring payment under this paragraph shall continue for a Bank for
60 days, such Bank may be replaced in accordance with the procedures in Section
2.15.
Section 2.11. Payments and Computations.
(a) Payment Procedures. The Borrower shall make each payment
under this Agreement and under the Notes not later than 11:00 a.m. (Dallas,
Texas time) on the day when due in Dollars to the Administrative Agent at the
location referred to in the Notes (or such other location as the Administrative
Agent shall designate in writing to the Borrower) in same day funds. The
Administrative Agent will promptly thereafter, and in any event prior to the
close of business on the day any timely payment is made, cause to be
distributed like funds relating to the payment of principal, interest or fees
ratably (other than amounts payable solely to the Administrative Agent, the
Issuing Bank, or a specific Bank pursuant to Section 2.03, 2.04(b), 2.04(c),
2.07(c), (d), or (e), 2.09, 2.10, 2.12, or 9.07 but after taking into account
payments effected pursuant to Section 9.04) in accordance with each Bank's Pro
Rata Share to the Banks for the account of their respective Applicable Lending
Offices, and like funds relating to the payment of any other
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amount payable to any Bank or the Issuing Bank to such Bank for the account of
its Applicable Lending Office, in each case to be applied in accordance with
the terms of this Agreement.
(b) Computations. All computations of interest based on the Base
Rate shall be made by the Administrative Agent on the basis of a year of 365 or
366 days, as the case may be, and all computations of interest based on the
Eurodollar Rate, the Federal Funds Rate, and of fees shall be made by the
Administrative Agent, on the basis of a year of 360 days, in each case for the
actual number of days (including the first day, but excluding the last day)
occurring in the period for which such interest or fees are payable. Each
determination by the Administrative Agent of an interest rate shall be
conclusive and binding for all purposes, absent manifest error.
(c) Non-Business Day Payments. Whenever any payment shall be
stated to be due on a day other than a Business Day, such payment shall be made
on the next succeeding Business Day, and such extension of time shall in such
case be included in the computation of payment of interest or fees, as the case
may be; provided, however, that if such extension would cause payment of
interest on or principal of Eurodollar Rate Advances to be made in the next
following calendar month, such payment shall be made on the next preceding
Business Day.
(d) Administrative Agent Reliance. Unless the Administrative
Agent shall have received written notice from the Borrower prior to the date on
which any payment is due to the Banks that the Borrower will not make such
payment in full, the Administrative Agent may assume that the Borrower has made
such payment in full to the Administrative Agent on such date and the
Administrative Agent may, in reliance upon such assumption, cause to be
distributed to each Bank on such date an amount equal to the amount then due
such Bank. If and to the extent the Borrower shall not have so made such
payment in full to the Administrative Agent, each Bank shall repay to the
Administrative Agent forthwith on demand such amount distributed to such Bank,
together with interest, for each day from the date such amount is distributed
to such Bank until the date such Bank repays such amount to the Administrative
Agent, at the Federal Funds Rate for such day.
Section 2.12. Taxes.
(a) No Deduction for Certain Taxes. Any and all payments by the
Borrower shall be made, in accordance with Section 2.11, free and clear of and
without deduction for any and all present or future taxes, levies, imposts,
deductions, charges or withholdings, and all liabilities with respect thereto,
excluding, in the case of each Bank, the Issuing Bank, and the Administrative
Agent, taxes imposed on its income and franchise taxes imposed on it (all such
nonexcluded taxes, levies, imposts, deductions, charges, withholdings and
liabilities being hereinafter referred to as "Taxes"). If the Borrower shall
be required by law to deduct any Taxes from or in respect of any sum payable to
any Bank, the Issuing Bank, or the Administrative
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Agent, (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 2.12), such Bank, the Issuing Bank,
or the Administrative Agent (as the case may be) receives an amount equal to
the sum it would have received had no such deductions been made; provided,
however, that if the Borrower's obligation to deduct or withhold Taxes is
caused solely by such Bank's, the Issuing Bank's, or the Administrative Agent's
failure to provide the forms described in paragraph (d) of this Section 2.12
and such Bank, the Issuing Bank, or the Administrative Agent could have
provided such forms, no such increase shall be required; (ii) the Borrower
shall make such deductions; and (iii) the Borrower shall pay the full amount
deducted to the relevant taxation authority or other authority in accordance
with applicable law.
(b) Other Taxes. In addition, the Borrower agrees to pay any
present or future stamp or documentary taxes or any other excise or property
taxes, charges or similar levies which arise from any payment made or from the
execution, delivery or registration of, or otherwise with respect to, this
Agreement, the Notes, or the other Credit Documents (hereinafter referred to as
"Other Taxes").
(c) Indemnification. The Borrower indemnifies each Bank, the
Issuing Bank, and the Administrative Agent for the full amount of Taxes or
Other Taxes (including, without limitation, any Taxes or Other Taxes imposed by
any jurisdiction on amounts payable under this Section 2.12) paid by such Bank,
the Issuing Bank, or the Administrative Agent (as the case may be) and any
liability (including interest and expenses) arising therefrom or with respect
thereto, whether or not such Taxes or Other Taxes were correctly or legally
asserted. Each payment required to be made by the Borrower in respect of this
indemnification shall be made to the Administrative Agent for the benefit of
any party claiming such indemnification within 30 days from the date the
Borrower receives written demand detailing the calculation of such amounts
therefor from the Administrative Agent on behalf of itself as Administrative
Agent, the Issuing Bank, or any such Bank. If any Bank, the Administrative
Agent, or the Issuing Bank receives a refund in respect of any taxes paid by
the Borrower under this paragraph (c), such Bank, the Administrative Agent, or
the Issuing Bank, as the case may be, shall promptly pay to the Borrower the
Borrower's share of such refund.
(d) Foreign Bank Withholding Exemption. Each Bank and Issuing
Bank that is not incorporated under the laws of the United States of America or
a state thereof agrees that it will deliver to the Borrower and the
Administrative Agent on the date of this Agreement or upon the effectiveness of
any Assignment and Acceptance (i) two duly completed copies of United States
Internal Revenue Service Form 1001 or 4224 or successor applicable form, as the
case may be, certifying in each case that such Bank is entitled to receive
payments under this Agreement and the Notes payable to it, without deduction or
withholding of any United States federal income taxes, (ii) if applicable, an
Internal Revenue Service Form W-8 or W-9 or successor applicable
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form, as the case may be, to establish an exemption from United States backup
withholding tax, and (iii) any other governmental forms which are necessary or
required under an applicable tax treaty or otherwise by law to reduce or
eliminate any withholding tax, which have been reasonably requested by the
Borrower. Each Bank which delivers to the Borrower and the Administrative
Agent a Form 1001 or 4224 and Form W-8 or W-9 pursuant to the next preceding
sentence further undertakes to deliver to the Borrower and the Administrative
Agent two further copies of the said letter and Form 1001 or 4224 and Form W-8
or W-9, or successor applicable forms, or other manner of certification, as the
case may be, on or before the date that any such letter or form expires or
becomes obsolete or after the occurrence of any event requiring a change in the
most recent letter and form previously delivered by it to the Borrower and the
Administrative Agent, and such extensions or renewals thereof as may reasonably
be requested by the Borrower and the Administrative Agent certifying in the
case of a Form 1001 or 4224 that such Bank is entitled to receive payments
under this Agreement without deduction or withholding of any United States
federal income taxes. If an event (including without limitation any change in
treaty, law or regulation) has occurred prior to the date on which any delivery
required by the preceding sentence would otherwise be required which renders
all such forms inapplicable or which would prevent any Bank from duly
completing and delivering any such letter or form with respect to it and such
Bank advises the Borrower and the Administrative Agent that it is not capable
of receiving payments without any deduction or withholding of United States
federal income tax, and in the case of a Form W-8 or W-9, establishing an
exemption from United States backup withholding tax, such Bank shall not be
required to deliver such letter or forms. The Borrower shall withhold tax at
the rate and in the manner required by the laws of the United States with
respect to payments made to a Bank failing to timely provide the requisite
Internal Revenue Service forms.
Section 2.13. Sharing of Payments, Etc. If any Bank shall obtain
any payment (whether voluntary, involuntary, through the exercise of any right
of set-off or otherwise) on account of the Advances made by it in excess of its
Pro Rata Share of payments on account of the Advances or Letter of Credit
Obligations obtained by all the Banks, such Bank shall notify the
Administrative Agent and forthwith purchase from the other Banks such
participations in the Advances made by them or Letter of Credit Obligations
held by them as shall be necessary to cause such purchasing Bank to share the
excess payment ratably in accordance with the requirements of this Agreement
with each of them; provided, however, that if all or any portion of such excess
payment is thereafter recovered from such purchasing Bank, such purchase from
each Bank shall be rescinded and such Bank shall repay to the purchasing Bank
the purchase price to the extent of such Bank's ratable share (according to the
proportion of (a) the amount of the participation sold by such Bank to the
purchasing Bank as a result of such excess payment to (b) the total amount of
such excess payment) of such recovery, together with an amount equal to such
Bank's ratable share (according to the proportion of (a) the amount of such
Bank's required repayment to the purchasing Bank to (b) the total amount of all
such required
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repayments to the purchasing Bank) of any interest or other amount paid or
payable by the purchasing Bank in respect of the total amount so recovered.
The Borrower agrees that any Bank so purchasing a participation from another
Bank pursuant to this Section 2.13 may, to the fullest extent permitted by law,
unless and until rescinded as provided above, exercise all its rights of
payment (including the right of set-off) with respect to such participation as
fully as if such Bank were the direct creditor of the Borrower in the amount of
such participation.
Section 2.14. Letters of Credit.
(a) Issuance. From time-to-time from the date of this
Agreement until three months before the Tranche A Maturity Date, at the request
of the Borrower, an Issuing Bank shall, on the terms and conditions hereinafter
set forth, issue, increase, or extend the expiration date of Letters of Credit
for the account of the Borrower on any Business Day. No Letter of Credit will
be issued, increased, or extended:
(i) if such issuance, increase, or extension would cause
the Letter of Credit Exposure to exceed the lesser of (1)
$50,000,000.00 and (2) the aggregate Tranche A Commitments less the
aggregate outstanding principal amount of all Tranche A Advances,
Competitive Advances, and Debt permitted under Section 6.02(d);
(ii) unless such Letter of Credit has an Expiration Date
not later than the earlier of (A) one year after the date of issuance
thereof and (B) the Tranche A Maturity Date;
(iii) unless such Letter of Credit is in form and substance
acceptable to such Issuing Bank in its sole discretion;
(iv) unless such Letter of Credit is a standby letter of
credit not supporting the repayment of Funded Debt of any Person;
(v) unless the Borrower has delivered to such Issuing
Bank a completed and executed letter of credit application on such
Issuing Bank's standard form which shall contain terms no more
restrictive than the terms of this Agreement; and
(vi) unless such Letter of Credit is governed by the
Uniform Customs and Practice for Documentary Credits (1993 Revision),
International Chamber of Commerce Publication No. 500 or any successor
to such publication. If the terms of any letter of credit application
referred to in the foregoing clause (v) conflicts with the terms of
this Agreement, the terms of this Agreement shall control.
(b) Participations. (i) On the Effective Date, such Issuing Bank
shall be deemed to have sold to each Bank and each other Bank shall be deemed
to have purchased from such Issuing
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Bank a participation equal to such Bank's Pro Rata Share at such date in the
Letter of Credit Obligations related to each Letter of Credit issued under the
Existing Credit Agreement and outstanding on the Effective Date and (ii) upon
the date of the issuance or increase of a Letter of Credit occurring on or
after the Effective Date, such Issuing Bank shall be deemed to have sold to
each other Bank and each other Bank shall have been deemed to have purchased
from such Issuing Bank a participation in the related Letter of Credit
Obligations equal to such Bank's Pro Rata Share at such date and such sale and
purchase shall otherwise be in accordance with the terms of this Agreement.
Such Issuing Bank shall promptly notify each such participant Bank by telex,
telephone, or telecopy of each Letter of Credit issued or increased and the
actual dollar amount of such Bank's participation in such Letter of Credit.
(c) Reimbursement. The Borrower hereby agrees to pay on demand to
such Issuing Bank for the benefit of the Banks in respect of each Letter of
Credit an amount equal to any amount paid by such Issuing Bank under or in
respect of such Letter of Credit. In the event such Issuing Bank makes a
payment pursuant to a request for draw presented under a Letter of Credit and
such payment is not promptly reimbursed by the Borrower upon demand, such
Issuing Bank shall give notice of such payment to the Administrative Agent and
the Banks, and each Bank shall promptly reimburse such Issuing Bank for such
Bank's Pro Rata Share of such payment, and such reimbursement shall be deemed
for all purposes of this Agreement to constitute a Tranche A Borrowing
comprised of Base Rate Advances to the Borrower from such Bank. If such
reimbursement is not made by any Bank to the Issuing Bank on the same day on
which such Issuing Bank shall have made payment on any such draw, such Bank
shall pay interest thereon to such Issuing Bank at a rate per annum equal to
the Federal Funds Rate. The Borrower hereby unconditionally and irrevocably
authorizes, empowers, and directs the Administrative Agent and the Banks to
record and otherwise treat such payment under a Letter of Credit not
immediately reimbursed by the Borrower as a Tranche A Borrowing comprised of
Base Rate Advances to the Borrower.
(d) Obligations Unconditional. The obligations of the Borrower
under this Agreement in respect of each Letter of Credit shall be unconditional
and irrevocable, and shall be paid strictly in accordance with the terms of
this Agreement under all circumstances, notwithstanding the following
circumstances:
(i) any lack of validity or enforceability of any Letter
of Credit Documents;
(ii) any amendment or waiver of or any consent to
departure from any Letter of Credit Documents;
(iii) the existence of any claim, set-off, defense or other
right which the Borrower may have at any time against any beneficiary
or transferee of such Letter of Credit (or any
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Persons for whom any such beneficiary or any such transferee may be
acting), such Issuing Bank or any other person or entity, whether in
connection with this Agreement, the transactions contemplated in this
Agreement or in any Letter of Credit Documents or any unrelated
transaction;
(iv) any statement or any other document presented under
such Letter of Credit proving to be forged, fraudulent, invalid or
insufficient in any respect or any statement therein being untrue or
inaccurate in any respect to the extent the Issuing Bank would not be
liable therefor pursuant to the following paragraph (e);
(v) payment by such Issuing Bank under such Letter of
Credit against presentation of a draft or certificate which does not
comply with the terms of such Letter of Credit; or
(vi) any other circumstance or happening whatsoever,
whether or not similar to any of the foregoing;
provided, however, that nothing contained in this paragraph (d) shall be deemed
to constitute a waiver of any remedies of the Borrower in connection with the
Letters of Credit.
(e) Liability of Issuing Bank. The Borrower assumes all risks of
the acts or omissions of any beneficiary or transferee of any Letter of Credit
with respect to its use of such Letter of Credit. Neither such Issuing Bank
nor any of its officers or directors shall be liable or responsible for:
(i) the use which may be made of any Letter of Credit or
any acts or omissions of any beneficiary or transferee in connection
therewith;
(ii) the validity, sufficiency or genuineness of
documents, or of any endorsement thereon, even if such documents
should prove to be in any or all respects invalid, insufficient,
fraudulent or forged;
(iii) payment by such Issuing Bank against presentation of
documents which do not comply with the terms of a Letter of Credit,
including failure of any documents to bear any reference or adequate
reference to the relevant Letter of Credit, unless such payment was
due to such Issuing Bank's gross negligence or willful misconduct; or
(iv) any other circumstances whatsoever in making or
failing to make payment under any Letter of Credit (including such
Issuing Bank's own negligence, but other than through such Issuing
Bank's gross negligence or willful misconduct),
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except that the Borrower shall have a claim against the Issuing Bank, and the
Issuing Bank shall be liable to, and shall promptly pay to, the Borrower, to
the extent of any direct, as opposed to consequential, damages suffered by the
Borrower which the Borrower proves were caused by (A) such Issuing Bank's
willful misconduct or gross negligence in determining whether documents
presented under a Letter of Credit comply with the terms of such Letter of
Credit or (B) such Issuing Bank's willful failure to make lawful payment under
any Letter of Credit after the presentation to it of a draft and certificate
strictly complying with the terms and conditions of such Letter of Credit.
In furtherance and not in limitation of the foregoing, such Issuing Bank may
accept documents that appear on their face to be in order, without
responsibility for further investigation, regardless of any notice or
information to the contrary.
Section 2.15. Bank Replacement.
(a) Right to Replace. The Borrower shall have the right to
replace each Terminating Bank at any time and each Bank affected by a condition
under Section 2.02(c)(iii) or (v), 2.08(e), or 2.10 for more than 60 days (each
Terminating Bank and each such affected Bank, an "Affected Bank") with an
Eligible Assignee in accordance with the procedures in this Section 2.15.
(b) Procedure. Any replacement of a Bank pursuant to this Section
2.15 shall be (i) made by the Eligible Assignee designated by the Borrower or
by the Administrative Agent with the Borrower's consent and the selling Bank
entering into an Assignment and Acceptance and by following the procedures in
Section 9.06 for adding a Bank and (ii) shall close within 10 days after the
Administrative Agent's receipt of the notice of election to replace such Bank.
ARTICLE III
CONDITIONS OF LENDING
Section 3.01. Conditions Precedent to Effectiveness. This
Agreement shall become effective and the Existing Credit Agreement shall be
amended and restated as provided in this Agreement on the date the following
conditions precedent are met ("Effective Date"):
(a) The Borrower, each Bank, and the Administrative Agent shall
have duly and validly executed originals of this Agreement and delivered them
to the Administrative Agent;
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(b) The Administrative Agent shall have received the following
duly executed by all the parties thereto, in form and substance satisfactory to
the Administrative Agent, (except for the Notes) in sufficient copies for each
Bank:
(i) the Tranche A Notes, the Tranche B Notes and the
Competitive Advance Notes dated as of the Effective Date payable to
the order of each of the Banks, respectively;
(ii) a Guaranty executed by each of the Borrower's
Subsidiaries (other than its Nonprofit Subsidiaries and LCA Insurance
Co., Ltd.);
(iii) a certificate from the Chief Executive Officer,
President, Chief Financial Officer, or Treasurer of the Borrower dated
as of the Effective Date stating that as of such date (A) all
representations and warranties of the Borrower set forth in this
Agreement are true and correct in all material respects and (B) no
Default has occurred and is continuing;
(iv) copies, each certified as of the date of this
Agreement by a Secretary or Assistant Secretary of the Borrower and
each Guarantor (A) of the resolutions of the Board of Directors of the
Borrower or such Guarantor, as the case may be, and authorizing the
execution and delivery of each Credit Document to which such Person is
a party and (B) of the certificate of incorporation and bylaws of the
Borrower or such Guarantor, as the case may be;
(v) a certificate of the Secretary or an Assistant
Secretary of the Borrower and each Guarantor dated as of the date of
this Agreement certifying as of such date the names and true
signatures of officers of the Borrower or such Guarantor, as the case
may be, authorized to sign the Credit Documents to which such Person
is a party;
(vi) a favorable opinion of the Associate General Counsel
to the Borrower and the Guarantors, dated as of the Effective Date, in
form and substance satisfactory to the Administrative Agent; and
(vii) such other documents, governmental certificates,
agreements, licenses, lien searches as the Administrative Agent or any
Bank may reasonably request.
(c) The Borrower shall have paid to the Administrative Agent for
its account and the account of the Documentation Agent and the Syndication
Agent the fees and expenses required by Section 2.04(b) to be paid as of the
Effective Date.
(d) No Default or Event of Default shall have occurred and be
continuing.
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(e) The representations and warranties contained in Article IV and
in Section 6 of the Guaranties shall be true and correct in all material
respects.
Section 3.02. Conditions Precedent to all Borrowings. The
obligation of each Bank to fund an Advance on the occasion of each Borrowing
(other than the Conversion or continuation of any existing Borrowing) and of an
Issuing Bank to issue or increase any Letter of Credit shall be subject to the
further conditions precedent that on the date of such Borrowing or the issuance
or increase of such Letter of Credit the following statements shall be true
(and each of the giving of the applicable Notice of Borrowing and the
acceptance by the Borrower of the proceeds of such Borrowing or the issuance or
increase of such Letter of Credit shall constitute a representation and
warranty by the Borrower that on the date of such Borrowing or the issuance or
increase of such Letter of Credit such statements are true):
(a) the representations and warranties contained in Article IV
(excluding the representations and warranties contained in Sections 4.05(a),
4.06, 4.13(b), and 4.16(a)) and Section 6 of the Guaranties are correct in all
material respects on and as of the date of such Borrowing or the issuance or
increase of such Letter of Credit, before and after giving effect to such
Borrowing or to the issuance or increase of such Letter of Credit and to the
application of the proceeds from such Borrowing, as though made on and as of
such date and
(b) no Default has occurred and is continuing or would result from
such Borrowing or from the application of the proceeds therefrom.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
The Borrower represents and warrants as follows:
Section 4.01. Corporate Existence; Subsidiaries. The Borrower is a
corporation duly organized, validly existing, and in good standing under the
laws of Delaware and in good standing and qualified to do business in each
jurisdiction where its ownership or lease of property or conduct of its
business requires such qualification and where a failure to be qualified would
reasonably be expected to cause a Material Adverse Effect. Each Subsidiary of
the Borrower is a corporation duly organized, validly existing, and in good
standing under the laws of its jurisdiction of incorporation and in good
standing and qualified to do business in each jurisdiction where its ownership
or lease of property or conduct of its business requires such qualification and
where a failure to be qualified would reasonably be expected to cause a
Material Adverse Effect. The Borrower has no Subsidiaries on the date of this
Agreement other than the Subsidiaries listed
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on the attached Schedule 4.01, and Schedule 4.01 lists the jurisdiction of
incorporation and the address of the principal office of each such Subsidiary
existing on the date of this Agreement.
Section 4.02. Corporate Power. The execution, delivery, and
performance by the Borrower of this Agreement, the Notes, and the other Credit
Documents to which it is a party and by the Guarantors of the Guaranties and
the consummation of the transactions contemplated hereby and thereby (a) are
within the Borrower's and the Guarantors' corporate powers, (b) have been duly
authorized by all necessary corporate action, (c) do not contravene (i) the
Borrower's or any Guarantor's certificate or articles, as the case may be, of
incorporation or by-laws or (ii) any law or any contractual restriction binding
on or affecting the Borrower or any Guarantor, the contravention of which would
reasonably be expected to cause a Material Adverse Effect and (d) will not
result in or require the creation or imposition of any Lien prohibited by this
Agreement. At the time of each Borrowing or the issuance or increase of each
Letter of Credit, such Borrowing and the use of the proceeds of such Borrowing
or the issuance or increase of such Letter of Credit will be within the
Borrower's corporate xxxxxx, xxxx have been duly authorized by all necessary
corporate action, (a) will not contravene (i) the Borrower's certificate of
incorporation or by-laws or (ii) any law or any contractual restriction binding
on or affecting the Borrower the contravention of which would reasonably be
expected to cause a Material Adverse Effect and (b) will not result in or
require the creation or imposition of any Lien prohibited by this Agreement.
Section 4.03. Authorization and Approvals. No authorization or
approval or other action by, and no notice to or filing with, any Governmental
Authority is required for the due execution, delivery and performance by the
Borrower of this Agreement, the Notes, or the other Credit Documents to which
the Borrower is a party or by each Guarantor of its Guaranty or the
consummation of the transactions contemplated thereby. At the time of each
Borrowing or the issuance or increase of any Letter of Credit, no authorization
or approval or other action by, and no notice to or filing with, any
Governmental Authority will be required for such Borrowing or the use of the
proceeds of such Borrowing or the issuance or increase of such Letter of
Credit.
Section 4.04. Enforceable Obligations. This Agreement, the Notes,
and the other Credit Documents to which the Borrower is a party have been duly
executed and delivered by the Borrower and the Guaranties have been duly
executed and delivered by the Guarantors. Each Credit Document is the legal,
valid, and binding obligation of the Borrower and each Guarantor which is a
party to it enforceable against the Borrower and each such Guarantor in
accordance with its terms, except as such enforceability may be limited by any
applicable bankruptcy, insolvency, reorganization, moratorium, or similar law
affecting creditors' rights generally and by general principles of equity
(whether considered in proceeding at law or in equity).
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Section 4.05. Financial Statements. (a) The balance sheets of the
Borrower and its Subsidiaries as at September 30, 1995, and the related
statements of income, cash flow, and retained earnings of the Borrower and its
Subsidiaries for the fiscal year then ended, copies of which have been
furnished to each Bank, and the balance sheets of the Borrower and its
Subsidiaries as at June 30, 1996, and the related statements of income and cash
flow of the Borrower and its Subsidiaries for the nine months then ended, duly
certified by an authorized financial officer of the Borrower, copies of which
have been furnished to each Bank, fairly present, subject, in the case of said
balance sheets as at June 30, 1996 and said statements of income and cash flow
for the nine months then ended, to year-end audit adjustments, the financial
condition of the Borrower and its Subsidiaries as at such dates and the results
of the operations of the Borrower and its Subsidiaries for the periods ended on
such dates, and such balance sheets and statements of income, cash flow, and
retained earnings were prepared in accordance with GAAP.
(b) No Material Adverse Change has occurred.
Section 4.06. True and Complete Disclosure. No representation,
warranty, or other statement made by the Borrower or any Guarantor (or on
behalf of the Borrower or any Guarantor) in this Agreement or any other Credit
Document contains any untrue statement of a material fact or omits to state any
material fact necessary to make the statements contained therein not misleading
in light of the circumstances in which they were made as of the date of this
Agreement the effect of which would reasonably be expected to have a Material
Adverse Effect. There is no fact known to any Responsible Officer of the
Borrower on the date of this Agreement and on the Effective Date that has not
been disclosed to the Banks which would reasonably be expected to have a
Material Adverse Effect. All projections, estimates, and pro forma financial
information furnished by the Borrower or on behalf of the Borrower were
prepared on the basis of assumptions, data, information, tests, or conditions
believed to be reasonable at the time such projections, estimates, and pro
forma financial information were furnished.
Section 4.07. Litigation. Except as otherwise disclosed to the
Banks in writing after the date of this Agreement, there is no pending or, to
the best knowledge of the Borrower, threatened action or proceeding affecting
the Borrower or any of its Subsidiaries before any court, Governmental Agency
or arbitrator, which would reasonably be expected to have a Material Adverse
Effect or which purports to affect the legality, validity, binding effect or
enforceability of this Agreement, any Note, or any other Credit Document or the
consummation of any of the transactions contemplated hereby or thereby.
Section 4.08. Use of Proceeds. The proceeds of Advances may only
be used by the Borrower to refinance existing Indebtedness under the Existing
Credit Agreement and for general
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corporate purposes, including acquisitions, working capital needs and the
issuance of Letters of Credit. The Borrower is not engaged in the business of
extending credit for the purpose of purchasing or carrying margin stock (within
the meaning of Regulation U). No proceeds of any Advance will be used to
purchase or carry any margin stock in violation of Regulation G, T, U or X.
Following application of the proceeds of each Advance, not more than 25 percent
(or such greater percent as may be provided for in any amendment to Section
221.2(g)(2)(i) of Regulation U after the date of this Agreement) of the value
of the assets (either of the Borrower only or of the Borrower and its
Subsidiaries on a consolidated basis), which are subject to any arrangement
with the Administrative Agent or any Bank (herein or otherwise) whereby the
Borrower's or any Subsidiary's right or ability to sell, pledge or otherwise
dispose of assets is in any way restricted, will be margin stock (within the
meaning of Regulation U).
Section 4.09. Investment Company Act. Neither the Borrower nor any
of its Subsidiaries is an "investment company" or a company "controlled" by an
"investment company" within the meaning of the Investment Company Act of 1940,
as amended.
Section 4.10. Public Utility Holding Company Act. Neither the
Borrower nor any of its Subsidiaries is a "holding company", or a "Subsidiary
company" of a "holding company", or an "affiliate" of a "holding company" or of
a "Subsidiary company" of a "holding company", within the meaning of the Public
Utility Holding Company Act of 1935, as amended.
Section 4.11. Taxes.
(a) Reports and Payments. All Returns required to be filed by or
on behalf of the Borrower, its Subsidiaries, or any member of the Controlled
Group (hereafter collectively called the "Tax Group") have been duly filed on a
timely basis or appropriate extensions have been obtained and such Returns are
and will be true, complete and correct, except where the failure to so file
would not be reasonably expected to have a Material Adverse Effect; and all
Taxes shown to be payable on the Returns or on subsequent assessments with
respect thereto will have been paid in full on a timely basis, and no other
Taxes will be payable by the Tax Group with respect to items or periods covered
by such Returns, except in each case to the extent of (i) reserves reflected in
the Financial Statements, (ii) taxes that are being contested in good faith, or
(iii) such Taxes, the failure to pay which would not have a Material Adverse
Effect. The reserves for accrued Taxes reflected in the financial statements
delivered to the Banks under this Agreement are adequate in the aggregate for
the payment of all unpaid Taxes, whether or not disputed, for the period ended
as of the date thereof and for any period prior thereto, and for which the Tax
Group may be liable in its own right, as withholding agent or as a transferee
of the assets of, or successor to, any Person, except for such Taxes or
reserves therefor, the failure to pay or provide for which does not and could
not have a Material Adverse Effect.
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(b) Taxes Definition. "Taxes" in this Section 4.11 shall mean all
taxes, charges, fees, levies, or other assessments imposed by any federal,
state, local, or foreign taxing authority, including without limitation,
income, gross receipts, excise, real or personal property, sales, occupation,
use, service, leasing, environmental, value added, transfer, payroll, and
franchise taxes (and including any interest, penalties, or additions to tax
attributable to or imposed on with respect to any such assessment).
(c) Returns Definition. "Returns" in this Section 4.11 shall mean
any federal, state, local, or foreign report, estimate, declaration of
estimated Tax, information statement or return relating to, or required to be
filed in connection with, any Taxes, including any information return or report
with respect to backup withholding or other payments of third parties.
Section 4.12. Pension Plans. No Termination Event has occurred
with respect to any Plan, and each Plan has complied with and been administered
in all material respects in accordance with applicable provisions of ERISA and
the Code. No "accumulated funding deficiency" (as defined in Section 302 of
ERISA) has occurred and there has been no excise tax imposed under Section 4971
of the Code. To the knowledge of any Responsible Officer of the Borrower, no
Reportable Event has occurred with respect to any Multiemployer Plan, and each
Multiemployer Plan has complied with and been administered in all material
respects with applicable provisions of ERISA and the Code. The present value
of all benefits vested under each Plan (based on the assumptions used to fund
such Plan) did not, as of the last annual valuation date applicable thereto,
exceed the value of the assets of such Plan allocable to such vested benefits
in any amount that would reasonably be expected to have a Material Adverse
Effect. Neither the Borrower nor any member of the Controlled Group has had a
complete or partial withdrawal from any Multiemployer Plan for which there is
any material withdrawal liability. As of the most recent valuation date
applicable thereto, neither the Borrower nor any member of the Controlled Group
has received notice that any Multiemployer Plan is insolvent or in
reorganization. Based upon GAAP existing as of the date of this Agreement and
current factual circumstances, the Borrower has no reason to believe that the
annual cost during the term of this Agreement to the Borrower or any of its
Subsidiaries for post-retirement benefits to be provided to the current and
former employees of the Borrower or any of its Subsidiaries under welfare
benefit plans (as defined in Section 3(1) of ERISA) could, in the aggregate,
reasonably be expected to have a Material Adverse Effect.
Section 4.13. No Burdensome Restrictions; No Defaults.
(a) Neither the Borrower nor any of its Subsidiaries is a
party to any indenture, loan or credit agreement or any lease or other
agreement or instrument or subject to any charter or corporate restriction or
provision of applicable Legal Requirement which would reasonably be expected to
have a Material Adverse Effect. The Borrower and the Guarantors are not in
default under or with respect to any contract, agreement, lease or other
instrument to which the Borrower
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or any Guarantor is a party and which would reasonably be expected to have a
Material Adverse Effect. To the knowledge of a Responsible Officer of the
Borrower, neither the Borrower nor any Guarantor has received any notice of
default under any contract, agreement, lease or other instrument to which the
Borrower or such Guarantor is a party which is continuing and which, if not
cured, would reasonably be expected to have a Material Adverse Effect.
(b) No Default has occurred and is continuing.
Section 4.14. Environmental Condition.
(a) The Borrower and its Subsidiaries, taken as a whole, (i) have
obtained all Environmental Permits necessary for the ownership and operation of
their respective material Properties and the conduct of their respective
businesses of which the failure to obtain would reasonably be expected to have
a Material Adverse Effect; (ii) have been and are in compliance with all terms
and conditions of such Environmental Permits and with all other material
requirements of applicable Environmental Laws of which the failure to comply
would reasonably be expected to have a Material Adverse Effect; (iii) have not
received notice of any violation or alleged violation of any Environmental Law
or Environmental Permit the violation of which would reasonably be expected to
have a Material Adverse Effect; and (iv) are not subject to any actual or
contingent Environmental Claim, which Environmental Claim would reasonably be
expected to have a Material Adverse Effect.
(b) To the knowledge of any Responsible Officer of the Borrower,
none of the present or previously owned or operated Property of the Borrower or
of any of its present or former Subsidiaries, wherever located, (i) has been
placed on or proposed to be placed on the National Priorities List, the
Comprehensive Environmental Response Compensation Liability Information System
list, or their state or local analogs, or have been otherwise designated,
listed, or identified as a potential site for removal, remediation, cleanup,
closure, restoration, reclamation, or other response activity under any
Environmental Laws; (ii) is subject to a Lien, arising under or in connection
with any Environmental Laws, that attaches to any revenues or to any Property
owned or operated by the Borrower or any of its Subsidiaries, wherever located,
which Lien would reasonably be expected to have a Material Adverse Effect; or
(iii) has been the site of any Release of Hazardous Substances or Hazardous
Wastes from present or past operations which has caused at the site or at any
third-party site any condition that has resulted in or would reasonably be
expected to result in the need for Response that would have a Material Adverse
Effect.
(c) Without limiting the foregoing, the present and, to the best
knowledge of any Responsible Officer of the Borrower, future liability, if any,
of the Borrower and its Subsidiaries, taken as a whole, which would reasonably
be expected to arise in connection with requirements under Environmental Laws
will not have a Material Adverse Effect.
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Section 4.15. Permits, Licenses, etc. The Borrower and its
Subsidiaries possess all permits, licenses, patents, patent rights or licenses,
trademarks, trademark rights, trade names rights and copyrights which the
failure to possess could reasonably be expected to have a Material Adverse
Effect. The Borrower and its Subsidiaries manage and operate their business in
accordance with all applicable Legal Requirements which the failure to so
manage or operate would reasonably be expected to have a Material Adverse
Effect.
Section 4.16. Health Care Regulatory Matters.
(a) To the knowledge of any Responsible Officer of the Borrower,
all necessary steps have been or are being taken to secure the renewal of any
Health Facility License, Medicaid Provider Agreement or Medicare Provider
Agreement issued with respect to any Facility which the failure to renew could
reasonably be expected to have a Material Adverse Effect and that is to expire
within 60 days after the date of this Agreement, and there is no reasonable
basis known to any Responsible Officer of the Borrower or its Subsidiaries that
any such renewal will not be obtained.
(b) There are no proceedings pending, or, to the best of the
Borrower's knowledge, threatened by any Governmental Authority seeking nor, to
the knowledge of any Responsible Officer of the Borrower or any of its
Subsidiaries, has the Borrower or any of its Subsidiaries taken any action to
the effect of which would be to adversely modify, revoke, withdraw, or suspend
any CON, Health Facility License, Medicaid Provider Agreement, Medicare
Provider Agreement, Medicare Certification or Medicaid Certification in a
manner that would reasonably be expected to have a Material Adverse Effect. To
the Borrower's knowledge, there is no decision to fail to renew or deny
payments under any Medicaid Provider Agreement or Medicare Provider Agreement
which failure or denial would reasonably be expected to have a Material Adverse
Effect.
ARTICLE V
AFFIRMATIVE COVENANTS
So long as any Note or any amount under any Credit Document shall
remain unpaid, any Letter of Credit shall remain outstanding, or any Bank shall
have any Commitment hereunder, the Borrower agrees, unless the Majority Banks
shall otherwise consent in writing, to comply with the following covenants.
Section 5.01. Compliance with Laws, Etc. The Borrower will comply,
and cause each of its Subsidiaries to comply, with all Legal Requirements of
which the failure to comply would
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reasonably be expected to have a Material Adverse Effect. Without limiting the
generality and coverage of the foregoing, the Borrower shall comply, and shall
cause each of its Subsidiaries to comply, in all material respects, with all
Environmental Laws and, in all material respects, all laws, regulations, or
directives with respect to equal employment opportunity and employee safety in
all jurisdictions in which the Borrower, or any of its Subsidiaries do
business; provided, however, that this Section 5.01 shall not prevent the
Borrower, or any of its Subsidiaries from, in good faith and with reasonable
diligence, contesting the validity or application of any such laws or
regulations by appropriate legal proceedings.
Section 5.02. Maintenance of Insurance. The Borrower will
maintain, and cause each of its Subsidiaries to maintain, insurance with
responsible and reputable insurance companies or associations in such amounts
and covering such risks as are usually carried by companies engaged in similar
businesses and owning similar properties in the same general areas in which the
Borrower or such Subsidiary operates, provided that the Borrower or such
Subsidiary may self-insure to the extent and in the manner normal for similarly
situated companies of like size, type and financial condition that are part of
a group of companies under common control.
Section 5.03. Preservation of Corporate Existence, Etc. The
Borrower will preserve and maintain, and cause each of its Subsidiaries to
preserve and maintain, its corporate existence, rights, franchises and
privileges in the jurisdiction of its incorporation, and qualify and remain
qualified, and cause each such Subsidiary to qualify and remain qualified, as a
foreign corporation in each jurisdiction in which qualification is necessary or
desirable in view of its business and operations or the ownership of its
properties, and, in each case, where failure to qualify or preserve and
maintain its rights and franchises would reasonably be expected to have a
Material Adverse Effect; provided, however, that nothing contained in this
Section 5.03 shall prevent any transaction permitted by Section 6.04.
Section 5.04. Payment of Taxes, Etc. The Borrower will pay and
discharge, and cause each of its Subsidiaries to pay and discharge, before the
same shall become delinquent and which the failure to timely pay or discharge
would reasonably be expected to have a Material Adverse Effect, (a) all taxes,
assessments and governmental charges or levies imposed upon it or upon its
income or profits or Property that are material in amount, prior to the date on
which penalties attach thereto and (b) all lawful claims that are material in
amount which, if unpaid, might by law become a Lien upon its Property;
provided, however, that neither the Borrower nor any such Subsidiary shall be
required to pay or discharge any such tax, assessment, charge, levy, or claim
which is being contested in good faith and by appropriate proceedings, and with
respect to which reserves in conformity with GAAP have been provided.
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Section 5.05. Visitation Rights. At any reasonable time and from
time-to-time and so long as any visit or inspection will not interfere with
patients' rights or unreasonably interfere with the Borrower's or any of its
Subsidiaries operations, upon reasonable notice, the Borrower will, and will
cause its Subsidiaries to, permit the Administrative Agent and any Bank or any
of its agents or representatives thereof, to examine and make copies of and
abstracts from the records and books of account of, and visit and inspect at
its reasonable discretion the properties of, the Borrower and any such
Subsidiary, to discuss the affairs, finances and accounts of the Borrower and
any such Subsidiary with any of their respective officers or directors.
Section 5.06. Reporting Requirements. The Borrower will furnish to
the Administrative Agent and each Bank:
(a) Defaults. As soon as possible and in any event within five
Business Days after the occurrence of each Default known to a Responsible
Officer of the Borrower or any of its Subsidiaries which is continuing on the
date of such statement, a statement of an authorized financial officer of the
Borrower setting forth the details of such Default and the actions which the
Borrower has taken and proposes to take with respect thereto;
(b) Quarterly Financials. As soon as available and in any event
not later than 45 days after the end of each of the first three quarters of
each fiscal year of the Borrower, the balance sheets of Borrower and its
Subsidiaries as of the end of such quarter and the statements of income and
cash flows of the Borrower and its Subsidiaries for the period commencing at
the end of the previous year and ending with the end of such quarter, all in
reasonable detail and duly certified with respect to such statements (subject
to year-end audit adjustments) by an authorized financial officer of the
Borrower as having been prepared in accordance with GAAP, together with a
compliance certificate duly executed by a Responsible Officer in substantially
the form of the attached Exhibit F;
(c) Annual Financials. As soon as available and in any event not
later than 90 days after the end of each fiscal year of the Borrower, a copy of
the annual audit report for such year for the Borrower and its Subsidiaries,
including therein balance sheets of the Borrower and its Subsidiaries as of the
end of such fiscal year and statements of income and retained earnings and of
cash flows of Borrower and its Subsidiaries for such fiscal year, in each case
certified by Ernst & Young or other nationally recognized independent certified
public accountants or other independent certified public accountants of
recognized standing acceptable to the Administrative Agent and including any
management letters delivered by such accountants to the Borrower in connection
with such audit, together with a compliance certificate duly executed by a
Responsible Officer in substantially the form of the attached Exhibit F;
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(d) Securities Law Filings. Promptly and in any event within 15
days after the sending or filing thereof, copies of all proxy material, reports
and other information which the Borrower or any of its Subsidiary sends to or
files with the United States Securities and Exchange Commission or sends to any
shareholder of the Borrower;
(e) Termination Events. As soon as possible and in any event (i)
within 30 days after the Borrower knows or has reason to know that any
Termination Event described in clause (a) of the definition of Termination
Event with respect to any Plan has occurred, and (ii) within 10 days after any
Responsible Officer of the Borrower knows or has reason to know that any other
Termination Event with respect to any Plan has occurred, a statement of a
Responsible Officer of the Borrower describing such Termination Event and the
action, if any, which the Borrower or such Affiliate proposes to take with
respect thereto;
(f) Termination of Plans. Promptly and in any event within two
Business Days after the knowledge of any Responsible Officer of the Borrower of
receipt thereof by the Borrower or any member of the Controlled Group from the
PBGC, copies of each notice received by the Borrower or any such member of the
Controlled Group of the PBGC's intention to terminate any Plan or to have a
trustee appointed to administer any Plan;
(g) Other ERISA Notices. Promptly and in any event within five
Business Days after the knowledge of any Responsible Officer of the Borrower of
receipt thereof by the Borrower or any member of the Controlled Group from a
Multiemployer Plan sponsor, a copy of each notice received by the Borrower or
any member of the Controlled Group concerning the imposition of withdrawal
liability pursuant to Section 4202 of ERISA in an amount that could reasonably
be expected to have a Material Adverse Effect;
(h) Environmental Notices. Promptly upon the knowledge of any
Responsible Officer of the Borrower of receipt thereof by the Borrower or any
of its Subsidiaries, a copy of any form of notice, summons or citation received
from the EPA, or any other Governmental Authority directly engaged in
protection of the Environment, concerning (i) material violations or alleged
violations of Environmental Laws, which seeks to impose liability therefor and
which, based upon information reasonably available to the Borrower at the time
or after such violation, would reasonably be expected to have a Material
Adverse Effect, (ii) any action or omission on the part of the Borrower or any
of its Subsidiaries in connection with Hazardous Waste or Hazardous Substances
which, based upon information reasonably available to the Borrower at the time
of such receipt, would reasonably be expected to have a Material Adverse
Effect, (iii) any notice of potential responsibility under CERCLA which would
reasonably be expected to have a Material Adverse Effect, or (iv) concerning
the filing of a Lien other than a Permitted Lien upon, against or in connection
with the Borrower, its present or former Subsidiaries, or any of their
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leased or owned material Property, wherever located, which would reasonably be
expected to have a Material Adverse Effect;
(i) Other Governmental Notices. Promptly and in any event within
five Business Days after receipt thereof by the Borrower or any Subsidiary and
the knowledge of such receipt by a Responsible Officer of the Borrower or any
inside counsel of the Borrower, (i) a copy of any notice, summons, citation, or
proceeding seeking to adversely modify in any material respect, revoke, or
suspend any CON, Health Facility License, Medicaid Provider Agreement, Medicare
Provider Agreement, Medicaid Certification, or Medicare Certification in a
manner that would reasonably be expected to have a Material Adverse Effect and
(ii) any revocation or involuntary termination of any Medicaid Provider
Agreement, Medicare Provider Agreement, Medicaid Certification, or Medicare
Certification that would reasonably be expected to have a Material Adverse
Effect;
(j) Material Changes. Prompt written notice of any condition or
event of which any Responsible Officer of the Borrower has knowledge, which
condition or event has resulted or could reasonably be expected to result in
(i) a Material Adverse Change or Material Adverse Effect or (ii) a breach of or
noncompliance with any term, condition, or covenant of any contract to which
the Borrower or any of its Subsidiaries is a party or by which they or their
properties may be bound, which breach or noncompliance would reasonably be
expected to have a Material Adverse Effect;
(k) Disputes, etc. Prompt written notice of any claims,
proceedings, or disputes, or to the knowledge of any Responsible Officer of the
Borrower threatened, or affecting the Borrower, or any of its Subsidiaries
which, if adversely determined, could reasonably be expected to have a Material
Adverse Effect; and
(l) Other Information. Such other information respecting the
business or Properties, or the condition or operations, financial or otherwise,
of the Borrower, or any of its Subsidiaries, as any Bank through the
Administrative Agent may from time-to-time reasonably request.
Section 5.07. Maintenance of Property. Borrower shall, and shall
cause each of its Subsidiaries to, (a) maintain all of its Property necessary
or useful in the proper conduct of its business in good working order and
condition, except where the failure to do so would not reasonably be expected
to have a Material Adverse Effect and (b) not knowingly or willfully permit the
commission of waste or other injury, or the occurrence of pollution,
contamination or any other condition in, on or about the owned or operated
property involving the Environment that would reasonably be expected to have a
Material Adverse Effect.
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Section 5.08. Additional Guaranties. Upon the creation or
acquisition after the Effective Date of any Material Subsidiary or promptly
after any Subsidiary which is not a Guarantor becomes a Material Subsidiary,
the Borrower will cause such Material Subsidiary to execute and deliver to each
Bank a Guaranty and such evidence of corporate authority to enter into such
Guaranty as the Administrative Agent may reasonably request; provided that as
of the last day of any fiscal quarter the Borrower and the Guarantors shall
have at least 85% of the Borrower's Tangible Net Assets on such day and at
least 85% of the Borrower's EBITDA for the four fiscal quarters ending on such
day. A "Material Subsidiary" is any Subsidiary of the Borrower which on the
date of its acquisition or formation or on any quarter end after the date of
this Agreement (a) has EBITDA for the four fiscal quarters ending immediately
preceding such date equal to or greater than 5% of the Borrower's EBITDA for
such period or (b) Tangible Net Assets equal to or greater than 5% of the
Borrower's Tangible Net Assets.
ARTICLE VI
NEGATIVE COVENANTS
So long as any Note or any amount under any Credit Document shall
remain unpaid, any Letter of Credit remain outstanding, or any Bank shall have
any Commitment, the Borrower agrees, unless the Majority Banks otherwise
consent in writing, to comply with the following covenants.
Section 6.01. Liens, Etc. The Borrower will not create, assume,
incur or suffer to exist, or permit any of its Subsidiaries to create, assume,
incur, or suffer to exist, any Lien on or in respect of any of its Property
whether now owned or hereafter acquired, or assign any right to receive income,
except that the Borrower and its Subsidiaries may create, incur, assume or
suffer to exist Liens:
(a) securing the Obligations;
(b) for taxes, assessments or governmental charges or levies on
Property of the Borrower or any Guarantor to the extent not required to be paid
pursuant to Sections 5.01 and 5.04;
(c) imposed by law, such as landlords', carriers', warehousemen's
and mechanics' liens and other similar Liens arising in the ordinary course of
business securing obligations which are not overdue for a period of more than
30 days or which are being contested in good faith and by appropriate
proceedings if adequate reserves with respect thereto are maintained on the
books of the Borrower and its Subsidiaries in accordance with GAAP;
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(d) arising in the ordinary course of business out of pledges or
deposits under workers' compensation laws, unemployment insurance, old age
pensions or other social security or retirement benefits, or similar
legislation or to secure public or statutory obligations of the Borrower or any
of its Subsidiaries;
(e) Liens securing purchase money Debt, Capital Leases, and
acquired Debt permitted under Section 6.02(k); provided that (i) in the case of
purchase money Debt and Capital Leases, each such Lien only encumbers the
property acquired in connection with the creation of such Debt of Capital Lease
and all proceeds therefrom and (ii) the fair market value of the collateral
securing any such Debt may exceed the outstanding principal amount of such Debt
only to the extent such excess is within customary commercial bank lending and
collateralization requirements;
(f) securing Debt listed on the attached Schedule 6.01; provided
that the Debt of the Borrower or any Subsidiary of the Borrower secured by such
Liens shall not be renewed, refinanced or extended if the amount of such Debt
so renewed is greater than the outstanding amount of such Debt on the date of
this Agreement;
(g) arising from litigation and which are effectively stayed from
execution and would not otherwise cause a Default to occur;
(h) in the nature of utility easements, building restrictions, and
such other encumbrances or charges against real property as are of a nature
generally existing with respect to properties of a similar character and which
do not in any material way affect the marketability of the same or interfere
with the use thereof in the business of the Borrower or its Subsidiaries;
(i) in the nature of any interest or title of a lessor in assets
being leased to the Borrower or one of its Subsidiaries; and
(j) encumbering the Property subject to the lease permitted by
Section 6.02(m).
Section 6.02. Debts, Guaranties and Other Obligations. The
Borrower will not, and will not permit any of its Subsidiaries to, create,
assume, suffer to exist or in any manner become or be liable in respect of any
Debt except:
(a) Debt of the Borrower and its Subsidiaries under the Credit
Documents;
(b) unsecured Debt listed on the attached Schedule 6.02 and all
renewals, extensions, rearrangements or refinancings of any such credit
arrangements on terms and for amounts substantially similar to the terms and
amounts existing as of the date of this Agreement;
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(c) intercompany Debt owed (i) by any wholly-owned Subsidiary of
the Borrower (other than a Nonprofit Subsidiary) to the Borrower; (ii) by the
Borrower to any of its wholly-owned Subsidiaries; and (iii) any wholly-owned
Subsidiary of the Borrower to another wholly-owned Subsidiary of the Borrower;
(d) unsecured borrowings at a market rate of interest with
maturities of less than 180 days of the Borrower not otherwise permitted by the
preceding paragraphs (a), (b), and (c) in an aggregate outstanding principal
amount not to exceed at any time the lesser of (i) $100,000,000.00 or (ii) the
amount by which the Tranche A Commitments exceeds the sum of the outstanding
Tranche A Advances, Letter of Credit Exposure, and Competitive Advances;
(e) Debt secured by the Liens permitted pursuant to paragraph (f)
of Section 6.01;
(f) current liabilities for the financing of the Borrower's and
its Subsidiaries' insurance premiums;
(g) the Borrower's guaranty under the Contract to Lease and
Surviving Master Agreement for Leases of Xxxxx, Trustee Nursing Homes dated as
of May 1, 1994 among the Borrower, Living Centers of Texas, Inc., and Xxxxxxxx
Xxxxx, Trustee of the repayment of the residual value of the premises leased
thereby;
(h) guaranties (i) by the Borrower's Subsidiaries of any Debt of
the Borrower permitted by this Section 6.02 and (ii) by the Borrower of its
wholly-owned Subsidiaries' Debt permitted by this Section 6.02;
(i) reimbursement obligations of the Borrower in respect of any
surety bonds or letters of credit otherwise permitted under this Agreement
issued to secure payment of any insurance premiums, regulatory obligations, or
trust fund obligations for the Borrower or any of its Subsidiaries;
(j) unfunded vested liabilities under any Plan that would not
reasonably be expected to have a Material Adverse Effect;
(k) Debt incurred in connection with the purchase of any Property,
Capital Leases, and Debt assumed in connection with any Acquisition Expenditure
in an aggregate outstanding principal amount not to exceed at any time the
greater of (i) $75,000,000.00 or (ii) 15% of the Borrower's Net Worth at such
time;
(l) Subordinated Debt in an aggregate outstanding principal amount
not to exceed at any time $150,000,000.00; and
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(m) (i) obligations to pay rent under any lease that is treated as
an operating lease under GAAP but for which the Borrower or any of its
Subsidiaries is viewed as the owner of the leased Property under the Code and
(ii) guaranties by the Borrower or any of its Subsidiaries of the obligations
of the lessor of such leased Property which are secured by the payments due
under the lease of such Property.
Section 6.03. Agreements Restricting Liens and Distributions. The
Borrower will not, nor will it permit any of its Subsidiaries to, enter into
any agreement (other than a Credit Document) which (a) except with respect to
specific property encumbered to secure payment of Debt related to such
property, imposes restrictions greater than those under this Agreement upon the
creation or assumption of any Lien upon its properties, revenues or assets,
whether now owned or hereafter acquired or (b) limits Restricted Payments to or
any advance by any of the Borrower's Subsidiaries to the Borrower.
Section 6.04. Merger or Consolidation; Asset Sales. The Borrower
will not, and will not permit any of its Subsidiaries to,
(a) merge or consolidate with or into any other Person, except
that (i) the Borrower may merge with any of its wholly-owned Subsidiaries and
(ii) any of the Borrower's wholly-owned Subsidiaries may merge with another of
the Borrower's wholly-owned Subsidiaries, provided that immediately after
giving effect to any such proposed transaction no Default would exist and in
the case of any such merger to which the Borrower is a party, the Borrower is
the surviving corporation or
(b) sell, lease, transfer, or otherwise dispose of any asset
(including stock of a Subsidiary) other than the Devcon Stock Sale or the sale
of certain assets acquired in connection with Project QC if the fair market
value of such asset plus the fair market value of all assets (including stock
of a Subsidiary) disposed of during the four fiscal quarters immediately
preceding the date of such asset sale would exceed 5% of Tangible Net Assets of
the Borrower; provided that, for sales of assets in a single transaction or in
a related series of transactions with a fair market value in excess in
$15,000,000.00, the Administrative Agent shall have received a Compliance
Certificate demonstrating pro forma financial covenant compliance, including
adjustments to the Borrower's EBITDA for such divested assets.
Upon the closing of any transaction permitted by this Section 6.04 involving a
Guarantor the shares of stock of which is sold or that does not survive a
merger, such Guarantor shall automatically be released from its obligations
under its Guaranty, and, if requested by the Borrower, the Agent, on its behalf
and the behalf of the Banks, shall execute a release of such Guarantor from its
Guaranty.
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Section 6.05. Restricted Payments. The Borrower will not make or
pay any Restricted Payment if a Default exists or would result therefrom.
Section 6.06. Investments. The Borrower will not, and will not
permit any of its Subsidiaries to, make or permit to exist any loans, advances
or capital contributions to, or make any investment in, or purchase or commit
to purchase any stock or other securities or evidences of indebtedness of or
interests in any Person, except the following:
(a) the purchase of Liquid Investments;
(b) trade and customer accounts receivable which are for goods
furnished or services rendered in the ordinary course of business and are
payable in accordance with customary trade terms;
(c) ordinary course of business contributions, loans or advances
to, or investments in, (i) a direct or indirect Subsidiary of the Borrower,
other than a Nonprofit Subsidiary or (ii) the Borrower;
(d) the Borrower's ownership of the stock of any Nonprofit
Subsidiary;
(e) other capital investments not otherwise permitted by this
Section 6.06 in an aggregate amount of such investments outstanding at any time
not to exceed $5,000,000.00;
(f) holding of notes receivable included on the Borrower's balance
sheet at June 30, 1995 or received in connection with asset sales permitted by
Section 6.04 or acquired in connection with acquisitions by the Borrower
permitted by Section 6.07; and
(g) Acquisition Expenditures permitted under Section 6.07.
Section 6.07. Acquisition Expenditures. Except for up to
$25,000,000.00 of aggregate cash consideration paid during any consecutive four
fiscal quarter period for all purchases of facilities which have been leased by
the Borrower or any of its Subsidiaries for at least three years, the Borrower
shall not and shall not permit any of its Subsidiaries to make any Acquisition
Expenditure, unless (a) such Acquisition Expenditure is made in substantially
the same or complementary lines of business of the Borrower and does not
violate any other provision of this Agreement; (b) except for Project QC, (i)
the aggregate cash consideration paid during any four consecutive four fiscal
quarter period plus (ii) assumptions of Debt for all Acquisition Expenditures
made during such period does not exceed (A) $100,000,000.00 plus (B) an amount
not less than zero, but equal to (1) the Net Cash Proceeds received from asset
sales permitted by Section 6.04 during such period minus (2) the total
automatic Commitment reductions made
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under Section 2.05(b) during such period; (c) at the time of such Acquisition
Expenditure no Default has occurred and is continuing or would occur upon the
consummation of such acquisition; (d) for Acquisition Expenditures in excess of
$15,000,000.00, the Administrative Agent shall have received a Compliance
Certificate demonstrating pro forma financial covenant compliance, including
adjustments to the Borrower's EBITDA for such acquired business; and (e)
immediately following the making of such Acquisition Expenditure, the aggregate
amount of the Commitments exceeds the aggregate outstanding principal amount of
the Advances, the Letter of Credit Exposure, and the outstanding principal
amount of Debt permitted by Section 6.02(d) by at least $25,000,000.00.
Section 6.08. Affiliate Transactions. Except as expressly
permitted elsewhere in this Agreement, the Borrower will not, and will not
permit any of its Subsidiaries to, make, directly or indirectly: (a) any
investment in any Affiliate (other than a wholly-owned Subsidiary of the
Borrower); (b) any transfer, sale, lease, assignment or other disposal of any
assets to any such Affiliate or any purchase or acquisition of assets from any
such Affiliate; or (c) any arrangement or other transaction directly or
indirectly with or for the benefit of any such Affiliate (including without
limitation, guaranties and assumptions of obligations of an Affiliate);
provided that the Borrower and its Subsidiaries (i) may enter into any
arrangement or other transaction with any such Affiliate providing for the
leasing of property, the rendering or receipt of services or the purchase or
sale of inventory and other assets in the ordinary course of business if the
monetary or business consideration arising therefrom would be substantially as
advantageous to the Borrower and its Subsidiaries as the monetary or business
consideration which it would obtain in a comparable arm's length transaction
with a Person not such an Affiliate and (ii) may maintain the arrangements
listed on the attached Schedule 6.08.
Section 6.09. Compliance with ERISA. The Borrower will not, and
will not permit any of its Subsidiaries to, (a) terminate any Plan so as to
result in any material (in the opinion of the Majority Banks) liability of the
Borrower or any of its Affiliates to the PBGC or (b) permit to exist any
occurrence of any Reportable Event (as defined in Title IV of ERISA), or any
other event or condition, which presents a material (in the opinion of the
Majority Banks) risk of such a termination by the PBGC of any Plan under
Section 4042 of ERISA.
Section 6.10. Cash Flow Ratio. The Borrower will not permit the
ratio of (a) its Cash Flow as of the end of any fiscal quarter for the four
fiscal quarters then ended to (b) Interest Expense for such period plus its
current maturities of long-term debt as of the last day of such period plus its
Lease Expense as of the last day of such period to be less than 1.30.
Section 6.11. Leverage Ratio. The Borrower will not permit its
Leverage Ratio as of the last day of any fiscal quarter to be greater than
3.25.
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Section 6.12. Net Worth. The Borrower will not permit its Net
Worth to be less than $295,000,000.00 plus 75% of its cumulative positive Net
Income for each fiscal quarter after March 31, 1996 (excluding Net Income for
any fiscal quarter for which Net Income is negative) plus 50% of the increase
of Net Worth caused by any issuance of capital stock after March 31, 1996.
Section 6.13. Indemnification Agreement. The Borrower shall not
agree to amend any provision of the Indemnification Agreement if such amendment
would increase the Borrower's obligations under the Indemnification Agreement.
ARTICLE VII
REMEDIES
Section 7.01. Events of Default. The occurrence of any of the
following events shall constitute an "Event of Default" under any Credit
Document:
(a) Payment. The Borrower shall fail to pay any principal of any
Note or any Reimbursement Obligation when the same becomes due and payable, or
any interest on any Note or any fee or other amount payable hereunder or under
any other Credit Document within three Business Days after the same becomes due
and payable;
(b) Representation and Warranties. Any representation or warranty
made or deemed to be made (i) by the Borrower in this Agreement (other than the
representation and warranty in Section 4.13(b)) or in any other Credit
Document, (ii) by the Borrower (or any of its officers) in connection with this
Agreement or any other Credit Document, or (iii) by any Subsidiary in any
Credit Document shall prove to have been incorrect in any material respect when
made or deemed to be made;
(c) Covenant Breaches. (i) The Borrower shall (A) fail to perform
or observe any covenant contained in Section 5.03 or 5.04 or Article VI of this
Agreement or (B) fail to perform or observe any other term or covenant set
forth in this Agreement or in any other Credit Document which is not covered by
clause (i)(A) above or any other provision of this Section 7.01 if such failure
shall remain unremedied for 30 days after the earlier of written notice of such
default shall have been given to such Person by the Administrative Agent or any
Bank or a Responsible Officer of such Person's actual knowledge of such default
or (ii) any Guarantor shall fail to perform or observe any covenant contained
in its Guaranty if such failure shall remain unremedied for the same period, if
any, applicable to such covenant in this Agreement after the earlier of written
notice of such default shall have been given to such Person by the
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Administrative Agent or any Bank or a Responsible Officer of such Person's
actual knowledge of such default;
(d) Cross-Defaults. (i) The Borrower or any its Subsidiaries
shall fail to pay any principal of or premium or interest on its Debt which is
outstanding in a principal amount of at least $10,000,000.00 individually or
when aggregated with all such Debt of the Borrower or its Subsidiaries so in
default (but excluding Debt evidenced by the Notes) when the same becomes due
and payable (whether by scheduled maturity, required prepayment, acceleration,
demand or otherwise), and such failure shall continue after the applicable
grace period, if any, specified in the agreement or instrument relating to such
Debt; (ii) any other event shall occur or condition shall exist under any
agreement or instrument relating to Debt which is outstanding in a principal
amount of at least $10,000,000.00 individually or when aggregated with all such
Debt of the Borrower and its Subsidiaries so in default, and shall continue
after the applicable grace period, if any, specified in such agreement or
instrument, if the effect of such event or condition is to accelerate, or to
permit the acceleration of, the maturity of such Debt; or (iii) any such Debt
shall be declared to be due and payable, or required to be prepaid (other than
by a regularly scheduled required prepayment), prior to the stated maturity
thereof;
(e) Insolvency. The Borrower or any of its Subsidiaries shall
generally not pay its debts as such debts become due, or shall admit in writing
its inability to pay its debts generally, or shall make a general assignment
for the benefit of creditors; or any proceeding shall be instituted by or
against the Borrower or any of its Subsidiaries seeking to adjudicate it a
bankrupt or insolvent, or seeking liquidation, winding up, reorganization,
arrangement, adjustment, protection, relief, or composition of it or its debts
under any law relating to bankruptcy, insolvency or reorganization or relief of
debtors, or seeking the entry of an order for relief or the appointment of a
receiver, trustee or other similar official for it or for any substantial part
of its property and, in the case of any such proceeding instituted against the
Borrower or any such Subsidiary, either such proceeding shall remain
undismissed for a period of 30 days or any of the actions sought in such
proceeding shall occur; or the Borrower or any of its Subsidiaries shall take
any corporate action to authorize any of the actions set forth above in this
paragraph (e);
(f) Judgments. Any judgment or order for the payment of money in
excess of $5,000,000.00 (reduced for purposes of this paragraph for the amount
in respect of such judgment or order that a reputable insurer has acknowledged
as being payable under any valid and enforceable insurance policy) shall be
rendered against the Borrower or any of its Subsidiaries and either (i)
enforcement proceedings shall have been commenced by any creditor upon such
judgment or order or (ii) there shall be any period of 30 consecutive days
during which a stay of enforcement of such judgment or order, by reason of a
pending appeal or otherwise, shall not be in effect;
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(g) Termination Events. Any Termination Event with respect to a
Plan shall have occurred, and, 30 days after notice thereof shall have been
given to the Borrower by the Administrative Agent, (i) such Termination Event
shall have created and caused to be continuing a material risk of Plan
termination or liability for withdrawal from the Plan as a substantive employer
and (ii) the then present value of such Plan's vested benefits exceeds the then
current value of assets accumulated in such Plan by more than the amount of
$10,000,000.00 (or in the case of a Termination Event involving the withdrawal
of a "substantial employer" (as defined in Section 4001(a)(2) of ERISA), the
withdrawing employer's proportionate share of such excess shall exceed such
amount);
(h) Plan Withdrawals. The Borrower or any member of the
Controlled Group as employer under a Multiemployer Plan shall have made a
complete or partial withdrawal from such Multiemployer Plan and the plan
sponsor of such Multiemployer Plan shall have notified such withdrawing
employer that such employer has incurred a withdrawal liability in an annual
amount exceeding $10,000,000.00;
(i) Guaranties. Any provision of any Guaranty requiring the
payment of the Guaranteed Obligations (as defined in the Guaranties) shall for
any reason cease to be valid and binding on the applicable Guarantor or the
applicable Guarantor shall so state in writing; or
(j) Change of Control. (i) as a result of one or more transactions
after the date of this Agreement, any "person" or "group" of persons acting in
concert (other than persons owning common stock of the Borrower on the
Effective Date (as defined in the Existing Credit Agreement) shall have
"beneficial ownership" of more than 30% of the outstanding common stock of the
Borrower (within the meaning of Section 13(d) or 14(d) of the Securities
Exchange Act of 1934, as amended, and the applicable rules and regulations
thereunder), provided that the relationships among the respective shareholders
of the Borrower on the date of this Agreement shall not be deemed to constitute
all or any combination of them as a "group" or (ii) during any period of 12
consecutive months, beginning with and after the Effective Date (as defined in
the Existing Credit Agreement), individuals who at the beginning of such
12-month period were directors of the Borrower shall cease for any reason to
constitute a majority of the board of directors of the Borrower at any time
during such period.
Section 7.02. Optional Acceleration of Maturity. If any Event of
Default (other than an Event of Default pursuant to paragraph (e) of Section
7.01) shall have occurred and be continuing, then, and in any such event,
(a) the Administrative Agent (i) shall at the request, or may with
the consent, of the Majority Banks, by notice to the Borrower, declare the
obligation of each Bank to make Advances and the obligation of the Issuing
Banks to issue, increase, or extend Letters of Credit
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to be terminated, whereupon the same shall forthwith terminate, and (ii) shall
at the request, or may with the consent, of the Majority Banks, by notice to
the Borrower, declare the Notes, all interest thereon, the Letter of Credit
Obligations, and all other amounts payable under this Agreement to be forthwith
due and payable, whereupon the Notes, all such interest, all such Letter of
Credit Obligations and all such amounts shall become and be forthwith due and
payable in full, without presentment, demand, protest or further notice of any
kind (including, without limitation, any notice of intent to accelerate or
notice of acceleration), all of which are hereby expressly waived by the
Borrower;
(b) the Borrower shall, on demand of the Administrative Agent at
the request or with the consent of the Majority Banks, deposit with the
Administrative Agent into the Cash Collateral Account an amount of cash equal
to the Letter of Credit Exposure as security for the Obligations to the extent
the Letter of Credit Obligations are not otherwise paid at such time; and
(c) the Agent shall at the request of, or may with the consent of,
the Majority Banks proceed to enforce its rights and remedies under the
Guaranties or any other Credit Document for the ratable benefit of the Banks by
appropriate proceedings.
Section 7.03. Automatic Acceleration of Maturity. If any Event of
Default pursuant to paragraph (e) of Section 7.01 shall occur,
(a) the obligation of each Bank to make Advances and the
obligation of the Issuing Banks to issue, increase, or extend Letters of Credit
shall immediately and automatically be terminated and the Notes, all interest
on the Notes, all Letter of Credit Obligations, and all other amounts payable
under this Agreement shall immediately and automatically become and be due and
payable in full, without presentment, demand, protest or any notice of any kind
(including, without limitation, any notice of intent to accelerate or notice of
acceleration), all of which are hereby expressly waived by the Borrower;
(b) the Borrower shall deposit with the Administrative Agent into
the Cash Collateral Account an amount of cash equal to the outstanding Letter
of Credit Exposure as security for the Obligations to the extent the Letter of
Credit Obligations are not otherwise paid at such time; and
(c) the Agent shall at the request of, or may with the consent of,
the Majority Banks proceed to enforce its rights and remedies under the
Guaranties or any other Credit Document for the ratable benefit of the Banks by
appropriate proceedings.
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Section 7.04. Cash Collateral Account.
(a) Pledge. The Borrower hereby pledges, and grants to the
Administrative Agent for the benefit of the Banks, a security interest in all
funds held in the Cash Collateral Account from time-to-time and all proceeds
thereof, as security for the payment of the Obligations, including all Letter
of Credit Obligations owing to the Issuing Banks or any other Bank due and to
become due from the Borrower to the Issuing Banks or any other Bank under this
Agreement in connection with the Letters of Credit. Nothing in this Section
7.04, however, shall either obligate the Administrative Agent to require any
funds to be deposited in the Cash Collateral Account or limit the right of the
Administrative Agent, which it may exercise at any time and from time-to-time,
to release to the Borrower any funds held in the Cash Collateral Account
pursuant to the other provisions of this Section 7.04.
(b) Application against Letter of Credit Obligations; Release of
Funds. The Administrative Agent may, at any time or from time-to-time apply
funds then held in the Cash Collateral Account to the payment of any Letter of
Credit Obligations owing to the Issuing Banks, in such order as the
Administrative Agent may elect, as shall have become or shall become due and
payable by the Borrower to the Issuing Banks under this Agreement in connection
with the Letters of Credit. So long as no Event of Default referred to in
paragraph (a) or (e) of Section 7.01 shall have occurred and be continuing, the
Administrative Agent will release to the Borrower at the Borrower's written
request funds held in the Cash Collateral Account in an amount up to but not
exceeding the excess, if any (immediately prior to the release of any such
funds), of (i) the total amount of funds held in the Cash Collateral Account
over (ii) the Letter of Credit Exposure.
(c) Duty of Care. The Administrative Agent shall exercise
reasonable care in the custody and preservation of any funds held in the Cash
Collateral Account and shall be deemed to have exercised such care if such
funds are accorded treatment substantially equivalent to that which the
Administrative Agent accords its own property, it being understood that the
Administrative Agent shall not have any responsibility for taking any necessary
steps to preserve rights against any parties with respect to any such funds.
Section 7.05. Non-exclusivity of Remedies. No remedy conferred
upon the Administrative Agent is intended to be exclusive of any other remedy,
and each remedy shall be cumulative of all other remedies existing by contract,
at law, in equity, by statute or otherwise.
Section 7.06. Right of Set-off. Upon (a) the occurrence and during
the continuance of any Event of Default and (b) the making of the request or
the granting of the consent, if any, specified by Section 7.02 to authorize the
Administrative Agent to declare the Notes and any other amount payable
hereunder due and payable pursuant to the provisions of Section 7.02 or
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the automatic acceleration of the Notes and all amounts payable under this
Agreement pursuant to Section 7.03, each Bank is hereby authorized at any time
and from time-to-time, to the fullest extent permitted by law, to set off and
apply any and all deposits (general or special, time or demand, provisional or
final) at any time held and other indebtedness at any time owing by such Bank
to or for the credit or the account of the Borrower against any and all of the
obligations of the Borrower now or hereafter existing under this Agreement, the
Note held by such Bank, and the other Credit Documents, irrespective of whether
or not such Bank shall have made any demand under this Agreement, such Note, or
such other Credit Documents, and although such obligations may be unmatured.
Each Bank agrees to promptly notify the Borrower after any such set-off and
application made by such Bank, provided that the failure to give such notice
shall not affect the validity of such set-off and application. The rights of
each Bank under this Section are in addition to any other rights and remedies
(including, without limitation, other rights of set-off) which such Bank may
have.
ARTICLE VIII
THE ADMINISTRATIVE AGENT AND THE ISSUING BANKS
Section 8.01. Authorization and Action. Each Bank hereby appoints
and authorizes the Administrative Agent to take such action as agent on its
behalf and to exercise such powers under this Agreement as are delegated to the
Administrative Agent by the terms hereof and of the other Credit Documents,
together with such powers as are reasonably incidental thereto. As to any
matters not expressly provided for by this Agreement or any other Credit
Document (including, without limitation, enforcement or collection of the
Notes), the Administrative Agent shall not be required to exercise any
discretion or take any action, but shall be required to act or to refrain from
acting (and shall be fully protected in so acting or refraining from acting)
upon the instructions of the Majority Banks, and such instructions shall be
binding upon all Banks and all holders of Notes; provided, however, that the
Administrative Agent shall not be required to take any action which exposes the
Administrative Agent to personal liability or which is contrary to this
Agreement, any other Credit Document, or applicable law.
Section 8.02. Administrative Agent's Reliance, Etc. Neither the
Administrative Agent nor any of its directors, officers, agents or employees
shall be liable for any action taken or omitted to be taken (including the
Administrative Agent's own negligence) by it or them under or in connection
with this Agreement or the other Credit Documents, except for its or their own
gross negligence or willful misconduct. Without limitation of the generality
of the foregoing, the Administrative Agent: (a) may treat the payee of any
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
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(including counsel for the Borrower), 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 Bank and
shall not be responsible to any Bank for any statements, warranties or
representations made in or in connection with this Agreement or the other
Credit 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 any other Credit Document on the part of the Borrower or its
Subsidiaries or to inspect the property (including the books and records) of
the Borrower or its Subsidiaries; (e) shall not be responsible to any Bank for
the due execution, legality, validity, enforceability, genuineness, sufficiency
or value of this Agreement or any other Credit Document; and (f) shall incur no
liability under or in respect of this Agreement or any other Credit Document by
acting upon any notice, consent, certificate or other instrument or writing
(which may be by telecopier, telegram, cable or telex) believed by it to be
genuine and signed or sent by the proper party or parties.
Section 8.03. The Administrative Agent and Its Affiliates. With
respect to its Commitment, the Advances made by it and the Note issued to it,
the Administrative Agent shall have the same rights and powers under this
Agreement as any other Bank and may exercise the same as though it were not the
Administrative Agent. The term "Bank" or "Banks" shall, unless otherwise
expressly indicated, include the Administrative Agent in its individual
capacity. The Administrative Agent and its Affiliates may accept deposits
from, lend money to, act as trustee under indentures of, and generally engage
in any kind of business with, the Borrower or any of its Subsidiaries, and any
Person who may do business with or own securities of the Borrower or any such
Subsidiary, all as if the Administrative Agent were not an agent hereunder and
without any duty to account therefor to the Banks.
Section 8.04. Bank Credit Decision. Each Bank acknowledges that it
has, independently and without reliance upon the Administrative Agent or any
other Bank and based on the financial statements referred to in Section 4.05
and such other documents and information as it has deemed appropriate, made its
own credit analysis and decision to enter into this Agreement. Each Bank also
acknowledges that it will, independently and without reliance upon the
Administrative Agent or any other Bank 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.
Section 8.05. INDEMNIFICATION. THE BANKS SEVERALLY AGREE TO
INDEMNIFY THE ADMINISTRATIVE AGENT, THE SYNDICATION AGENT, THE DOCUMENTATION
AGENT, AND THE ISSUING BANKS (TO THE EXTENT NOT REIMBURSED BY THE BORROWER),
ACCORDING TO THEIR RESPECTIVE PRO RATA SHARES FROM AND AGAINST ANY AND ALL
LIABILITIES, OBLIGATIONS,
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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 AND THE ISSUING BANKS
IN ANY WAY RELATING TO OR ARISING OUT OF THIS AGREEMENT OR ANY ACTION TAKEN OR
OMITTED BY THE ADMINISTRATIVE AGENT, THE SYNDICATION AGENT, THE DOCUMENTATION
AGENT OR THE ISSUING BANKS UNDER THIS AGREEMENT OR ANY OTHER CREDIT DOCUMENT
(INCLUDING THE ADMINISTRATIVE AGENT'S, THE SYNDICATION AGENT'S, THE
DOCUMENTATION AGENT'S, AND THE ISSUING BANKS' OWN NEGLIGENCE), PROVIDED THAT NO
BANK SHALL BE LIABLE FOR ANY PORTION OF SUCH LIABILITIES, OBLIGATIONS, LOSSES,
DAMAGES, PENALTIES, ACTIONS, JUDGMENTS, SUITS, COSTS, EXPENSES OR DISBURSEMENTS
RESULTING FROM THE ADMINISTRATIVE AGENT'S, THE SYNDICATION AGENT'S,
DOCUMENTATION AGENT'S, OR THE ISSUING BANKS' GROSS NEGLIGENCE OR WILLFUL
MISCONDUCT. WITHOUT LIMITATION OF THE FOREGOING, EACH BANK AGREES TO REIMBURSE
THE ADMINISTRATIVE AGENT PROMPTLY UPON DEMAND FOR ITS RATABLE 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 OR ANY OTHER CREDIT DOCUMENT, TO THE
EXTENT THAT THE ADMINISTRATIVE AGENT IS NOT REIMBURSED FOR SUCH EXPENSES BY THE
BORROWER.
Section 8.06. Successor Administrative Agent and Issuing Banks.
The Administrative Agent or any Issuing Bank may resign at any time by giving
written notice thereof to the Banks and the Borrower and may be removed at any
time with or without cause by the Majority Banks upon receipt of written notice
from the Majority Banks to such effect. Upon receipt of notice of any such
resignation or removal, the Majority Banks shall have the right to appoint a
successor Administrative Agent or Issuing Bank with, if an Event of Default has
not occurred and is not continuing, the consent of the Borrower, which consent
shall not be unreasonably withheld. If no successor Administrative Agent or
Issuing Bank shall have been so appointed, and shall have accepted such
appointment, within 30 days after the retiring Administrative Agent's or
Issuing Bank's giving of notice of resignation or the Majority Banks' removal
of the retiring Administrative Agent or Issuing Bank, then the retiring
Administrative Agent or Issuing Bank may, on behalf of the Banks and the
Borrower, appoint a successor Administrative Agent or Issuing Bank, which shall
be a commercial bank meeting the financial requirements of an Eligible Assignee
and, in the case of the Issuing Bank, a Bank. Upon the acceptance of any
appointment
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as Administrative Agent or Issuing Bank by a successor Administrative Agent or
Issuing Bank, such successor Administrative Agent or Issuing Bank shall
thereupon succeed to and become vested with all the rights, powers, privileges
and duties of the retiring Administrative Agent or Issuing Bank, and the
retiring Administrative Agent or Issuing Bank shall be discharged from its
duties and obligations under this Agreement and the other Credit Documents,
except that the retiring Issuing Bank shall remain the Issuing Bank with
respect to any Letters of Credit issued by it and outstanding on the effective
date of its resignation or removal and the provisions affecting the Issuing
Bank with respect to such Letters of Credit shall inure to the benefit of the
retiring Issuing Bank until the termination of all such Letters of Credit.
After any retiring Administrative Agent's or Issuing Bank's resignation or
removal hereunder as Administrative Agent or Issuing Bank, the provisions of
this Article VIII shall inure to its benefit as to any actions taken or omitted
to be taken by it while it was Administrative Agent or Issuing Bank under this
Agreement and the other Credit Documents.
Section 8.07. Documentation Agent and Syndication Agent. Neither
the Documentation Agent nor the Syndication Agent shall have any duties,
obligations, or liabilities in its capacity as the Documentation Agent or the
Syndication Agent respectively. Upon the resignation of the Documentation
Agent or the Syndication Agent, the Documentation Agent or the Syndication
Agent, as the case may be, shall not be replaced.
ARTICLE IX
MISCELLANEOUS
Section 9.01. Amendments, Etc. No amendment or waiver of any
provision of this Agreement, the Notes, or any other Credit Document, nor
consent to any departure by the Borrower or any Guarantor therefrom, shall in
any event be effective unless the same shall be in writing and signed by the
Majority Banks and the Borrower, and then such waiver or consent shall be
effective only in the specific instance and for the specific purpose for which
given; provided, however, that no amendment, waiver or consent shall, unless in
writing and signed by all the Banks and the Borrower, do any of the following:
(a) waive any of the conditions specified in Section 3.01 or 3.02, (b) increase
the Commitments of the Banks, (c) reduce the principal of, or interest on, the
Notes or any fees or other amounts payable hereunder or under any other Credit
Document or, except as specifically provided in Section 2.01(c), extend the
Tranche A Maturity Date or the Tranche B Commitment Termination Date, (d)
postpone any date fixed for any payment of principal of, or interest on, the
Notes or any fees or other amounts payable hereunder, including any change in
required amortization of the Tranche B Advances under Section 2.06(c), (e)
change the number of Banks which shall be required for the Banks or any of them
to take any action hereunder or under any other Credit Document, (f) amend
Section
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2.13 or this Section 9.01, (g) release any Guarantor from its obligations under
any Guaranty, except as contemplated by Section 6.04; or (h) amend the
definition of "Majority Banks"; and provided, further, that no amendment,
waiver or consent shall, unless in writing and signed by the Administrative
Agent, the Documentation Agent, the Syndication Agent, or the Issuing Banks in
addition to the Banks required above to take such action, affect the rights or
duties of the Administrative Agent, the Documentation Agent, the Syndication
Agent, or the Issuing Banks, as the case may be, under this Agreement or any
other Credit Document.
Section 9.02. Notices, Etc. All notices and other communications
shall be in writing (including telecopy or telex) and mailed, telecopied,
telexed, hand delivered or delivered by a nationally recognized overnight
courier, if to the Borrower, at its address at 00000 Xxxx Xxxxxxx, Xxxxx 000,
Xxxxxxx, Xxxxx 00000, Attention: Treasurer (telecopy: (000) 000-0000;
telephone: (000) 000-0000), with a copy to the Associate General Counsel
(telecopy (000) 000-0000; telephone (000) 000-0000); if to any Bank at its
Domestic Lending Office specified opposite its name on Schedule 1 or pursuant
to Section 2.11(b); if to the Administrative Agent, at its address at 000
Xxxxxxxxx, 0xx xxxxx, Xxxxxxx, Xxxxx 00000, Attention: Xx. Xxxxx X. Xxxxxxx,
Senior Vice President (telecopy: (000) 000-0000; telephone: (000) 000-0000);
and if a Notice of Borrowing or a Notice of Conversion or Continuation to the
Administrative Agent at the Domestic Lending Office for the Administrative
Agent specified opposite its name on Schedule 1 or, as to each party, at such
other address or teletransmission number as shall be designated by such party
in a written notice to the other parties. All such notices and communications
shall, when mailed, telecopied, telexed or hand delivered or delivered by
overnight courier, be effective three days after deposited in the mails, when
telecopy transmission is completed, when confirmed by telex answer-back or when
delivered, respectively, except that notices and communications to the
Administrative Agent pursuant to Article II or VIII shall not be effective
until received by the Administrative Agent.
Section 9.03. No Waiver; Remedies. No failure on the part of any
Bank, the Administrative Agent, or the Issuing Banks to exercise, and no delay
in exercising, any right hereunder or under any Note shall operate as a waiver
thereof; nor shall any single or partial exercise of any such right preclude
any other or further exercise thereof or the exercise of any other right. The
remedies provided in this Agreement are cumulative and not exclusive of any
remedies provided by law.
Section 9.04. Costs and Expenses. The Borrower agrees to pay on
demand all out-of-pocket costs and expenses of the Administrative Agent in
connection with the preparation, execution, delivery, administration,
modification and amendment of this Agreement, the Notes and the other Credit
Documents including, without limitation, the reasonable fees and out-of-pocket
expenses of counsel for the Administrative Agent and with respect to advising
the Administrative Agent as to its rights and responsibilities under this
Agreement, and all reasonable out-of-pocket costs
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and expenses, if any, of the Administrative Agent, the Issuing Bank, and each
Bank (including, without limitation, reasonable counsel fees and expenses of
the Administrative Agent, the Issuing Banks, and each Bank, including allocated
costs of in-house counsel) in connection with the enforcement (whether through
negotiations, legal proceedings or otherwise) of this Agreement, the Notes and
the other Credit Documents.
Section 9.05. Binding Effect. This Agreement shall become
effective when it shall have been executed by the Borrower and the
Administrative Agent, and when the Administrative Agent shall have, as to each
Bank, either received a counterpart hereof executed by such Bank or been
notified by such Bank that such Bank has executed it and thereafter shall be
binding upon and inure to the benefit of the Borrower, the Administrative
Agent, the Issuing Banks, and each Bank and their respective successors and
assigns, except that the Borrower shall not have the right to assign its rights
or delegate its duties under this Agreement or any interest in this Agreement
without the prior written consent of each Bank.
Section 9.06. Bank Assignments and Participations.
(a) Assignments. Any Bank may assign to one or more banks or other
entities all or any portion of its rights and obligations under this Agreement
(including, without limitation, all or a portion of its Commitment, the
Advances owing to it, the Notes held by it, and the participation interest in
the Letter of Credit Obligations held by it); provided, however, that (i) each
such assignment shall be of a constant, and not a varying, percentage of all of
such Bank's rights and obligations under this Agreement, (ii) the amount of the
Commitments and Advances of such Bank being assigned pursuant to each such
assignment (determined as of the date of the Assignment and Acceptance with
respect to such assignment) shall in no event be less than $10,000,000.00 and
shall be an integral multiple of $1,000,000.00, (iii) each such assignment
shall be to an Eligible Assignee, (iv) the parties to each such assignment
shall execute and deliver to the Administrative Agent, for its acceptance and
recording in the Register, an Assignment and Acceptance, together with the
Notes subject to such assignment, and (v) each Eligible Assignee (other than an
Eligible Assignee of the Administrative Agent) shall pay to the Administrative
Agent a $2,500 administrative fee. Upon such execution, delivery, acceptance
and recording, from and after the effective date specified in each Assignment
and Acceptance, which effective date shall be at least three Business Days
after the execution thereof, (A) the assignee thereunder shall be a party
hereto for all purposes and, to the extent that rights and obligations
hereunder have been assigned to it pursuant to such Assignment and Acceptance,
have the rights and obligations of a Bank hereunder and (B) such Bank
thereunder shall, to the extent that rights and obligations hereunder have been
assigned by it pursuant to such Assignment and Acceptance, relinquish its
rights and be released from its obligations under this Agreement (and, in the
case of an Assignment and Acceptance covering all or the remaining portion of
such Bank's rights and obligations under this Agreement, such Bank shall cease
to be a party hereto).
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(b) Term of Assignments. By executing and delivering an
Assignment and Acceptance, the Bank thereunder and the assignee thereunder
confirm to and agree with each other and the other parties hereto as follows:
(i) other than as provided in such Assignment and Acceptance, such Bank makes
no representation or warranty and assumes no responsibility with respect to any
statements, warranties or representations made in or in connection with this
Agreement or the execution, legality, validity, enforceability, genuineness,
sufficiency of value of this Agreement or any other instrument or document
furnished pursuant hereto; (ii) such Bank makes no representation or warranty
and assumes no responsibility with respect to the financial condition of the
Borrower or the Guarantors or the performance or observance by the Borrower or
the Guarantors of any of their obligations under this Agreement or any other
instrument or document furnished pursuant hereto; (iii) such assignee confirms
that it has received a copy of this Agreement, together with copies of the
financial statements referred to in Section 4.05 and such other documents and
information as it has deemed appropriate to make its own credit analysis and
decision to enter into such Assignment and Acceptance; (iv) such assignee will,
independently and without reliance upon the Administrative Agent, such Bank or
any other Bank 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; (v) such assignee appoints and
authorizes the Administrative Agent to take such action as agent on its behalf
and to exercise such powers under this Agreement as are delegated to the
Administrative Agent by the terms hereof, together with such powers as are
reasonably incidental thereto; and (vi) such assignee agrees that it will
perform in accordance with their terms all of the obligations which by the
terms of this Agreement are required to be performed by it as a Bank.
(c) The Register. The Administrative Agent shall maintain at its
address referred to in Section 9.02 a copy of each Assignment and Acceptance
delivered to and accepted by it and a register for the recordation of the names
and addresses of the Banks and the Commitments of, and principal amount of the
Advances owing to, each Bank from time-to-time (the "Register"). The entries
in the Register shall be conclusive and binding for all purposes, absent
manifest error, and the Borrower, the Administrative Agent, the Issuing Bank,
and the Banks may treat each Person whose name is recorded in the Register as a
Bank hereunder for all purposes of this Agreement. The Register shall be
available for inspection by the Borrower or any Bank at any reasonable time and
from time-to-time upon reasonable prior notice.
(d) Procedures. Upon its receipt of an Assignment and Acceptance
executed by a Bank and an Eligible Assignee, together with the Tranche A Notes,
Tranche B Notes, and Competitive Bid Notes subject to such assignment, the
Administrative Agent shall, if such Assignment and Acceptance has been
completed and is in substantially the form of the attached Exhibit A, (i)
accept such Assignment and Acceptance, (ii) record the information contained
therein in the Register, and (iii) give prompt notice thereof to the Borrower.
Within five Business Days after its receipt of such notice, the Borrower, at
its own expense, shall execute and deliver to the
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Administrative Agent in exchange for the surrendered Tranche A Notes, Tranche B
Notes, and Competitive Bid Notes, a new Tranche A Note and Tranche B Note to
the order of such Eligible Assignee in an amount equal to the respective
Commitments assumed by it pursuant to such Assignment and Acceptance and a new
Competitive Bid Note in an amount equal to the Tranche A Commitment assumed by
it and, if such Bank has retained any Commitment hereunder, a new Tranche A
Note and a new Tranche B Note to the order of such Bank in an amount equal to
the Commitments, respectively, retained by it hereunder and a new Competitive
Bid Note in an amount equal to the Tranche A Commitment retained by such Bank.
Such new Notes shall be dated the effective date of such Assignment and
Acceptance and shall otherwise be in substantially the form of the attached
Exhibits E-1, E-2, and E-3.
(e) Participations. Each Bank may sell participations to one or
more banks or other entities in or to all or a portion of its rights and
obligations under this Agreement (including, without limitation, all or a
portion of its Commitments, the Advances owing to it, its participation
interest in the Letter of Credit Obligations, and the Notes held by it);
provided, however, that (i) such Bank's obligations under this Agreement
(including, without limitation, its Commitments to the Borrower hereunder)
shall remain unchanged, (ii) such Bank shall remain solely responsible to the
other parties hereto for the performance of such obligations, (iii) such Bank
shall remain the holder of any such Notes for all purposes of this Agreement,
(iv) the Borrower, the Administrative Agent, and the Issuing Banks and the
other Banks shall continue to deal solely and directly with such Bank in
connection with such Bank's rights and obligations under this Agreement, and
(v) such Bank shall not require the participant's consent to any matter under
this Agreement, except for change in the principal amount of the Notes,
reductions in fees or interest, change in amortization of Tranche B Advances,
or, except as specifically provided in Section 2.01(c), extending the Tranche A
Maturity Date or the Tranche B Commitment Termination Date. The Borrower
hereby agrees that a Bank may pass through to any of its participants the same
rights under Sections 2.09, 2.10, 2.12(c), 9.04 and 9.07 to the extent of their
respective participations, provided that no participant shall be able to
collect in excess of amounts payable to the Bank selling to such participant
under such Sections in respect of the interest sold to such participant or to
collect any such amounts from the Borrower.
(f) Notwithstanding anything to the contrary in Section 9.06(a),
any Bank may assign, as collateral or otherwise, any of its rights (including,
without limitation, rights to payments of principal of and/or interest on the
Notes) under any Credit Document to any Federal Reserve Bank without notice to
or consent of the Borrower or the Administrative Agent.
Section 9.07. INDEMNIFICATION. THE BORROWER SHALL INDEMNIFY THE
ADMINISTRATIVE AGENT, THE SYNDICATION AGENT, THE DOCUMENTATION AGENT, THE
BANKS, THE ISSUING BANKS, AND EACH AFFILIATE THEREOF AND THEIR RESPECTIVE
DIRECTORS, OFFICERS, EMPLOYEES AND AGENTS FROM, AND DISCHARGE, RELEASE, AND
HOLD EACH OF THEM HARMLESS AGAINST,
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ANY AND ALL LOSSES, LIABILITIES, CLAIMS OR DAMAGES TO WHICH ANY OF THEM MAY
BECOME SUBJECT, INSOFAR AS SUCH LOSSES, LIABILITIES, CLAIMS OR DAMAGES ARISE
OUT OF OR RESULT FROM (I) ANY ACTUAL OR PROPOSED USE BY THE BORROWER OR ANY
AFFILIATE OF THE BORROWER OF THE PROCEEDS OF ANY ADVANCE, (II) ANY BREACH BY
THE BORROWER OF ANY PROVISION OF THIS AGREEMENT OR ANY OTHER CREDIT DOCUMENT,
(III) ANY INVESTIGATION, LITIGATION OR OTHER PROCEEDING (INCLUDING ANY
THREATENED INVESTIGATION OR PROCEEDING) RELATING TO THE FOREGOING, OR (IV) ANY
ENVIRONMENTAL CLAIM OR REQUIREMENT OF ENVIRONMENTAL LAWS CONCERNING OR RELATING
TO THE PRESENT OR PREVIOUSLY-OWNED OR OPERATED PROPERTIES, OR THE OPERATIONS OR
BUSINESS, OF THE BORROWER OR ANY OF ITS SUBSIDIARIES, AND THE BORROWER SHALL
REIMBURSE THE ADMINISTRATIVE AGENT, THE SYNDICATION AGENT, THE DOCUMENTATION
AGENT, THE ISSUING BANKS, AND EACH BANK, AND EACH AFFILIATE THEREOF AND THEIR
RESPECTIVE DIRECTORS, OFFICERS, EMPLOYEES AND AGENTS, UPON DEMAND FOR ANY
REASONABLE OUT-OF-POCKET EXPENSES (INCLUDING LEGAL FEES) INCURRED IN CONNECTION
WITH ANY SUCH INVESTIGATION, LITIGATION OR OTHER PROCEEDING; AND EXPRESSLY
INCLUDING ANY SUCH LOSSES, LIABILITIES, CLAIMS, DAMAGES, OR EXPENSE INCURRED BY
REASON OF THE PERSON BEING INDEMNIFIED'S OWN NEGLIGENCE, BUT EXCLUDING ANY SUCH
LOSSES, LIABILITIES, CLAIMS, DAMAGES OR EXPENSES INCURRED BY REASON OF THE
GROSS NEGLIGENCE OR WILLFUL MISCONDUCT OF THE PERSON TO BE INDEMNIFIED.
Section 9.08. Execution in Counterparts. This Agreement may be
executed in any number of counterparts and by different parties hereto in
separate counterparts, each of which when so executed shall be deemed to be an
original and all of which taken together shall constitute one and the same
agreement.
Section 9.09. Survival of Representations, etc. All
representations and warranties contained in this Agreement or made in writing
by or on behalf of the Borrower in connection herewith shall survive the
execution and delivery of this Agreement and the Credit Documents, the making
of the Advances and any investigation made by or on behalf of the Banks, none
of which investigations shall diminish any Bank's right to rely on such
representations and warranties. All obligations of the Borrower provided for
in Sections 2.09, 2.10, 2.12(c), and 9.07 shall survive any termination of this
Agreement and repayment in full of the Obligations.
Section 9.10. Severability. In case one or more provisions of this
Agreement or the other Credit Documents shall be invalid, illegal or
unenforceable in any respect under any applicable
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law, the validity, legality and enforceability of the remaining provisions
contained herein or therein shall not be affected or impaired thereby.
Section 9.11. Business Loans. The Borrower warrants and represents
that the Loans evidenced by the Notes are and shall be for business,
commercial, investment or other similar purposes and not primarily for
personal, family, household or agricultural use, as such terms are used in
Chapter One ("Chapter One") of the Texas Credit Code. At all such times, if
any, as Chapter One shall establish a Maximum Rate, the Maximum Rate shall be
the "indicated rate ceiling" (as such term is defined in Chapter One) from time
to time in effect.
Section 9.12. Usury Not Intended. It is the intent of the Borrower
and each Bank in the execution and performance of this Agreement and the other
Credit Documents to contract in strict compliance with applicable usury laws,
including conflicts of law concepts, governing the Advances of each Bank
including such applicable laws of the State of Texas and the United States of
America from time-to-time in effect. In furtherance thereof, the Banks and the
Borrower stipulate and agree that none of the terms and provisions contained in
this Agreement or the other Credit Documents shall ever be construed to create
a contract to pay, as consideration for the use, forbearance or detention of
money, interest at a rate in excess of the Maximum Rate and that for purposes
hereof "interest" shall include the aggregate of all charges which constitute
interest under such laws that are contracted for, charged or received under
this Agreement; and in the event that, notwithstanding the foregoing, under any
circumstances the aggregate amounts taken, reserved, charged, received or paid
on the Advances, include amounts which by applicable law are deemed interest
which would exceed the Maximum Rate, then such excess shall be deemed to be a
mistake and each Bank receiving same shall credit the same on the principal of
its Notes (or if such Notes shall have been paid in full, refund said excess to
the Borrower). In the event that the maturity of the Notes are accelerated by
reason of any election of the holder thereof resulting from any Event of
Default under this Agreement or otherwise, or in the event of any required or
permitted prepayment, then such consideration that constitutes interest may
never include more than the Maximum Rate and excess interest, if any, provided
for in this Agreement or otherwise shall be canceled automatically as of the
date of such acceleration or prepayment and, if theretofore paid, shall be
credited on the applicable Notes (or, if the applicable Notes shall have been
paid in full, refunded to the Borrower of such interest). In determining
whether or not the interest paid or payable under any specific contingencies
exceeds the Maximum Rate, the Borrower and the Banks shall to the maximum
extent permitted under applicable law amortize, prorate, allocate and spread in
equal parts during the period of the full stated term of the Notes all amounts
considered to be interest under applicable law at any time contracted for,
charged, received or reserved in connection with the Obligations. The
provisions of this Section shall control over all other provisions of this
Agreement or the other Credit Documents which may be in apparent conflict
herewith.
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Section 9.13. Confidentiality. Each Bank agrees that it will use
its best efforts not to disclose without the prior consent of the Borrower
(other than to its subsidiaries and affiliates conducting business related to
the making and syndication of loans and its and such subsidiaries and
affiliates' employees, auditors or counsel or to another Bank if the disclosing
Bank or the disclosing Bank's holding or parent company in its sole discretion
determines that any such party should have access to such information) any
information with respect to the Borrower or its Subsidiaries which is furnished
pursuant to this Agreement or any other Credit Document and which is designated
by the Borrower to the Banks in writing as confidential, provided that any Bank
may disclose any such information (a) as has become generally available to the
public, (b) as may be required or appropriate in any report, statement or
testimony submitted to any municipal, state or federal regulatory body having
or claiming to have jurisdiction over such Bank or to the Federal Reserve Board
or the FDIC or similar organizations (whether in the United States or
elsewhere), (c) as may be required or appropriate in response to any summons or
subpoena or in connection with any litigation, (d) in order to comply with any
law, order, regulation or ruling applicable to such Bank, and (e) to the
prospective transferee or participant in connection with any contemplated
transfer of any of the Notes or any interest therein by such Bank, provided,
that such prospective transferee or participant executes an agreement with the
Borrower containing provisions substantially identical to those contained in
this Section.
Section 9.14. Governing Law. This Agreement, the Notes and the
other Credit Documents shall be governed by, and construed and enforced in
accordance with, the laws of the State of Texas.
Section 9.15. Waiver of Jury. THE BORROWER, THE BANKS, THE
ADMINISTRATIVE AGENT, AND THE ISSUING BANKS HEREBY IRREVOCABLY WAIVE ANY AND
ALL RIGHT TO TRIAL BY JURY IN RESPECT OF ANY LEGAL PROCEEDING ARISING OUT OF OR
RELATING TO THIS AGREEMENT, ANY OTHER CREDIT DOCUMENT, OR ANY OF THE
TRANSACTIONS CONTEMPLATED HEREBY.
PURSUANT TO SECTION 26.02 OF THE TEXAS BUSINESS AND COMMERCE CODE, A
LOAN AGREEMENT IN WHICH THE AMOUNT INVOLVED IN THE LOAN AGREEMENT EXCEEDS
$50,000.00 IN VALUE IS NOT ENFORCEABLE UNLESS THE LOAN AGREEMENT IS IN WRITING
AND SIGNED BY THE PARTY TO BE BOUND OR THAT PARTY'S AUTHORIZED REPRESENTATIVE.
THE RIGHTS AND OBLIGATIONS OF THE PARTIES TO AN AGREEMENT SUBJECT TO
THE PRECEDING PARAGRAPH SHALL BE DETERMINED SOLELY FROM THE WRITTEN LOAN
AGREEMENT, AND ANY PRIOR ORAL AGREEMENTS BETWEEN THE PARTIES ARE SUPERSEDED BY
AND MERGED INTO THE LOAN AGREEMENT. THIS WRITTEN AGREEMENT AND THE CREDIT
DOCUMENTS, AS
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DEFINED IN THIS AGREEMENT, REPRESENT THE FINAL AGREEMENT AMONG THE PARTIES AND
MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT
ORAL AGREEMENTS OF THE PARTIES.
THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.
[Remainder of page intentionally left blank]
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EXECUTED as of the 19th day of August, 1996.
BORROWER:
LIVING CENTERS OF AMERICA, INC.
By:/s/ [signature omitted]
------------------------------------
Xxxx X. Xxxxxx
Vice President and Treasurer
ADMINISTRATIVE AGENT:
NATIONSBANK OF TEXAS, N.A.
By:/s/ [signature omitted]
------------------------------------
Xxxxx X. Xxxxxxx
Senior Vice President
BANKS:
TRANCHE A COMMITMENT NATIONSBANK OF TEXAS, N.A.
$31,500,000.00
TRANCHE B COMMITMENT By:/s/ [signature omitted]
------------------------------------
$13,500,000.00 Xxxxx X. Xxxxxxx
Senior Vice President
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TRANCHE A COMMITMENT THE CHASE MANHATTAN BANK, N.A.
$31,500,000.00
TRANCHE B COMMITMENT By:/s/ [signature omitted]
$13,500,000.00 ------------------------------------
Name:[printed name omitted]
----------------------------------
Title:[title omitted]
---------------------------------
TRANCHE A COMMITMENT TORONTO DOMINION (TEXAS), INC.
$31,500,000.00
TRANCHE B COMMITMENT By:/s/ [signature omitted]
$13,500,000.00 ------------------------------------
Name:[printed name omitted]
----------------------------------
Title:[title omitted]
---------------------------------
TRANCHE A COMMITMENT BANK OF AMERICA NATIONAL TRUST AND
$24,500,000.00 SAVINGS ASSOCIATION, as a Bank and
as co-agent
TRANCHE B COMMITMENT
$10,500,000.00
By:/s/ [signature omitted]
------------------------------------
Name:[printed name omitted]
----------------------------------
Title:[title omitted]
---------------------------------
TRANCHE A COMMITMENT THE LONG-TERM CREDIT BANK OF JAPAN,
$24,500,000.00 LIMITED, NEW YORK BRANCH, as a Bank
and co-agent
TRANCHE B COMMITMENT
$10,500,000.00 By:/s/ [signature omitted]
------------------------------------
Name:[printed name omitted]
----------------------------------
Title:[title omitted]
---------------------------------
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90
TRANCHE A COMMITMENT CREDIT LYONNAIS NEW YORK BRANCH,
$24,500,000.00 as a Bank and a co-agent
TRANCHE B COMMITMENT
$10,500,000.00 By:/s/ [signature omitted]
------------------------------------
Name:[printed name omitted]
----------------------------------
Title:[title omitted]
---------------------------------
TRANCHE A COMMITMENT COOPERATIVE CENTRALE RAIFFEISEN
$24,500,000.00 BOERENLEENBANK B.A., "RABOBANK
NEDERLAND", NEW YORK BRANCH, as a
TRANCHE B COMMITMENT Bank and as a co-agent
$10,500,000.00
By:/s/ [signature omitted]
------------------------------------
Name:[printed name omitted]
----------------------------------
Title:[title omitted]
---------------------------------
By:/s/ [signature omitted]
------------------------------------
Name:[printed name omitted]
----------------------------------
Title:[title omitted]
---------------------------------
TRANCHE A COMMITMENT BANQUE PARIBAS HOUSTON AGENCY
$15,750,000.00
TRANCHE B COMMITMENT By:/s/ [signature omitted]
$6,750,000.00 ------------------------------------
Name:[printed name omitted]
----------------------------------
Title:[title omitted]
---------------------------------
By:/s/ [signature omitted]
------------------------------------
Name:[printed name omitted]
----------------------------------
Title:[title omitted]
---------------------------------
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00
XXXXXXX X XXXXXXXXXX XXX XXXX XX XXXX XXXXXX
$15,750,000.00
TRANCHE B COMMITMENT By:/s/ [signature omitted]
$6,750,000.00 ------------------------------------
Name:[printed name omitted]
----------------------------------
Title:[title omitted]
---------------------------------
TRANCHE A COMMITMENT PNC BANK NATIONAL ASSOCIATION
$15,750,000.00
TRANCHE B COMMITMENT By:/s/ [signature omitted]
$6,750,000.00 ------------------------------------
Name:[printed name omitted]
----------------------------------
Title:[title omitted]
---------------------------------
TRANCHE A COMMITMENT AMSOUTH BANK OF ALABAMA
$15,750,000.00
TRANCHE B COMMITMENT By:/s/ [signature omitted]
$6,750,000.00 ------------------------------------
Name:[printed name omitted]
----------------------------------
Title:[title omitted]
---------------------------------
TRANCHE A COMMITMENT FIRST UNION NATIONAL BANK OF NORTH
$15,750,000.00 CAROLINA
TRANCHE B COMMITMENT
$6,750,000.00 By:/s/ [signature omitted]
------------------------------------
Name:[printed name omitted]
----------------------------------
Title:[title omitted]
---------------------------------
TRANCHE A COMMITMENT MELLON BANK, N.A.
$15,750,000.00
TRANCHE B COMMITMENT By:/s/ [signature omitted]
$6,750,000.00 ------------------------------------
Name:[printed name omitted]
----------------------------------
Title:[title omitted]
---------------------------------
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92
TRANCHE A COMMITMENT THE SANWA BANK, LIMITED, DALLAS
$5,750,000.00 AGENCY
TRANCHE B COMMITMENT By:/s/ [signature omitted]
$6,750,000.00 ------------------------------------
Name:[printed name omitted]
----------------------------------
Title:[title omitted]
---------------------------------
TRANCHE A COMMITMENT THE FUJI BANK, LIMITED, HOUSTON
$15,750,000.00 AGENCY
TRANCHE B COMMITMENT By:/s/ [signature omitted]
$6,750,000.00 ------------------------------------
Name:[printed name omitted]
----------------------------------
Title:[title omitted]
---------------------------------
TRANCHE A COMMITMENT THE SUMITOMO BANK, LIMITED
$15,750,000.00
TRANCHE B COMMITMENT By:/s/ [signature omitted]
$6,750,000.00 ------------------------------------
Name:[printed name omitted]
----------------------------------
Title:[title omitted]
---------------------------------
TRANCHE A COMMITMENT UNION BANK OF CALIFORNIA, N.A.
$15,750,000.00
TRANCHE B COMMITMENT By:/s/ [signature omitted]
$6,750,000.00 ------------------------------------
Name:[printed name omitted]
----------------------------------
Title:[title omitted]
---------------------------------
TOTAL TRANCHE A COMMITMENTS
$350,000,000.00
TOTAL TRANCHE B COMMITMENTS
$150,000,000.00
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