EXHIBIT 10.2
EXECUTION COPY
$150,000,000
GENESIS HEALTHCARE CORPORATION
2.5% CONVERTIBLE SENIOR SUBORDINATED DEBENTURES
DUE 2025
PURCHASE AGREEMENT
February 24, 2005
Wachovia Capital Markets, LLC
As Representative of the Several
Initial Purchasers named in Schedule
I hereto
c/o Wachovia Capital Markets, LLC
000 Xxxxx Xxxxxxx Xxxxxx, 0xx Xxxxx
Xxxxxxxxx, Xxxxx Xxxxxxxx 00000-0000
Dear Sirs and Mesdames:
Genesis HealthCare Corporation, a Pennsylvania corporation (the
"COMPANY"), confirms its agreement with respect to the proposed issuance and
sale to the several purchasers named in Schedule I hereto (the "INITIAL
PURCHASERS") of $150,000,000 principal amount of the Company's 2.5% Convertible
Senior Subordinated Debentures Due 2025 (the "FIRM SECURITIES") to be issued
pursuant to the provisions of an Indenture to be dated as of March 2, 2005 (the
"INDENTURE") among the Company, the Guarantors (as defined below), and The Bank
of New York, as Trustee (the "TRUSTEE"). The Company also proposes to issue and
sell to the Initial Purchasers not more than an additional $30,000,000 principal
amount of its 2.5% Convertible Senior Subordinated Debentures Due 2025 (the
"ADDITIONAL SECURITIES", and together with the Firm Securities, the
"SECURITIES") if and to the extent that you shall have determined to exercise,
on behalf of the Initial Purchasers, the right to purchase such Additional
Securities granted to the Initial Purchasers in Section 2 hereof. Subject to the
provisions of the Indenture, the Securities will be fully and unconditionally
guaranteed (the "SUBSIDIARY GUARANTEES") on an unsecured senior subordinated
basis by all of the domestic subsidiaries of the Company listed on the signature
pages to this Agreement and certain of the Company's future domestic
subsidiaries (collectively, the "GUARANTORS"). The Securities will be
convertible into shares of Common Stock, par value $0.01 per share, of the
Company (the "COMMON STOCK", and such shares into which the Securities are
convertible, the "UNDERLYING SECURITIES").
Wachovia Capital Markets, LLC has agreed to act as the sole book-running
manager and as Representative of the Initial Purchasers (in such capacity, the
"REPRESENTATIVE") in connection with the offering and sale of the Securities.
The Securities, the Underlying Securities and the Subsidiary Guarantees
will be offered without being registered under the Securities Act of 1933, as
amended (the "SECURITIES ACT"), to qualified institutional buyers in compliance
with the exemption from registration provided by Rule 144A under the Securities
Act.
The Initial Purchasers and their direct and indirect transferees will be
entitled to the benefits of a Registration Rights Agreement (the "REGISTRATION
RIGHTS AGREEMENT"), to be dated the Closing Date (as defined herein) among the
Company, the Guarantors and the Initial Purchasers.
The Company has prepared and delivered to each Initial Purchaser copies of
a preliminary offering memorandum dated February 23, 2005 (the "PRELIMINARY
MEMORANDUM") and has prepared and will deliver to each Initial Purchaser, on the
date hereof or the next succeeding day, copies of a final offering memorandum
dated February 24, 2005 (the "FINAL MEMORANDUM"), each for use by such Initial
Purchaser in connection with its solicitation of purchases of, or offering of,
the Securities. "MEMORANDUM" means, with respect to any date or time referred to
in this Agreement, the most recent offering memorandum (whether the Preliminary
Memorandum or the Final Memorandum, or any amendment or supplement to either
such document), including exhibits thereto and any documents incorporated by
reference therein, which has been prepared and delivered by the Company to the
Initial Purchasers in connection with their solicitation of purchases of, or
offering of, the Securities. The terms "SUPPLEMENT", "AMENDMENT" and "AMEND" as
used herein with respect to a Memorandum shall include all documents
incorporated by reference in the Memorandum that are filed subsequent to the
date of the Memorandum with the Securities and Exchange Commission (the
"COMMISSION") pursuant to the Securities Exchange Act of 1934, as amended (the
"EXCHANGE ACT").
All references in this Agreement to the Common Stock shall be deemed to
include the rights evidenced by such Common Stock to the extent provided in the
Rights Agreement dated as of November 18, 2003 between the Company and
StockTrans, Inc., as rights agent.
1. Representations and Warranties. The Company and each of the Guarantors
jointly and severally represent and warrant to, and agree with, you that:
(a) (i) Each document, if any, filed or to be filed pursuant to the
Exchange Act and incorporated by reference in the Memorandum complied when
filed or will comply when so filed in all material respects with the
Exchange Act and the applicable rules and regulations of the
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Commission thereunder and (ii) the Memorandum, in the form used by the
Initial Purchasers to confirm sales, as of its date and the Closing Date
(as defined in Section 4), will not contain any untrue statement of a
material fact or omit to state a material fact necessary to make the
statements therein, in the light of the circumstances under which they
were made, not misleading, except that the representations and warranties
set forth in this paragraph do not apply to statements or omissions in the
Memorandum based upon information relating to any Initial Purchaser
furnished to the Company in writing by such Initial Purchaser through you
expressly for use therein.
(b) The Memorandum has been prepared by the Company for use by the
Initial Purchasers as contemplated herein. No order or decree preventing
the use of the Memorandum, or any order asserting that the transactions
contemplated by this Agreement are subject to the registration
requirements of the Securities Act has been issued and no proceeding for
that purpose has commenced or is pending or, to the knowledge of the
Company or any of the Guarantors, is contemplated.
(c) The Company has been duly incorporated, is validly existing as a
corporation in good standing under the laws of the Commonwealth of
Pennsylvania, has the corporate power and authority to own its property
and to conduct its business as described in the Memorandum and is duly
qualified to transact business and is in good standing in each
jurisdiction in which the conduct of its business or its ownership or
leasing of property requires such qualification, except to the extent that
the failure to be so qualified or be in good standing would not have a
material adverse effect on the condition, financial or otherwise, or in
the earnings, business affairs or business prospects of the Company and
its subsidiaries, considered together as one enterprise, whether or not
arising in the ordinary course of business (a "MATERIAL ADVERSE EFFECT").
(d) Each of the subsidiaries of the Company has been duly
incorporated, organized or formed, as the case may be, and is validly
existing as a corporation, limited liability company or limited
partnership, as the case may be, in good standing under the laws of its
jurisdiction of incorporation, organization or formation; each of the
subsidiaries of the Company has power and authority to own, lease and
operate its properties and to conduct its business as described in the
Memorandum, is duly qualified as a foreign entity to transact business and
is in good standing in each jurisdiction in which such qualification is
required, whether by reason of the ownership or leasing of property or the
conduct of business, except where the failure so to qualify or to be in
good standing would not have a Material Adverse Effect; the issued and
outstanding capital stock or ownership interests, as the case may be, of
each of the Company's subsidiaries has been duly authorized and validly
issued, is fully paid and non-assessable, and, other than those
subsidiaries listed in Schedule 1(d),
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is owned by the Company, directly or indirectly, free and clear of any
security interest, mortgage, pledge, lien, encumbrance or claim, other
than such security interests, mortgages, pledges, liens, encumbrances or
claims pursuant to the Company's Senior Credit Agreement dated as of
December 1, 2003, as amended; none of the outstanding shares of capital
stock or ownership interests, as the case may be, of any of the Company's
subsidiaries held directly or indirectly by the Company was issued in
violation of the preemptive or similar rights of any securityholder of
such subsidiary.
(e) This Agreement has been duly authorized, executed and delivered
by the Company and each of the Guarantors.
(f) The authorized capital stock of the Company conforms as to legal
matters to the description thereof contained in the Memorandum.
(g) The shares of Common Stock outstanding prior to the issuance of
the Securities have been duly authorized and are validly issued, fully
paid and non-assessable.
(h) The Company and each of the Guarantors have all requisite
corporate, limited liability company, partnership or limited liability
partnership, as the case may be, power and authority to enter into this
Agreement and perform their respective obligations hereunder.
(i) The Company has all requisite corporate power and authority to
execute, issue and deliver the Securities and perform its obligations
thereunder. The Firm Securities and the Additional Securities have been
duly authorized and, when executed and authenticated in accordance with
the provisions of the Indenture and delivered to and paid for by the
Initial Purchasers in accordance with the terms of this Agreement, will be
valid and binding obligations of the Company, enforceable in accordance
with their terms, subject to applicable bankruptcy, fraudulent conveyance,
insolvency, reorganization, moratorium and similar laws affecting
creditors' rights generally and equitable principles of general
applicability and an implied covenant of good faith and fair dealing, and
will be entitled to the benefits of the Indenture and the Registration
Rights Agreement.
(j) The Company has all requisite corporate power and authority to
execute, issue and deliver the Underlying Securities. The Underlying
Securities issuable upon conversion of the Securities have been duly
authorized and reserved and, when issued upon conversion of the Securities
in accordance with the terms of the Securities, will be validly issued,
fully paid and non-assessable, and the issuance of the Underlying
Securities will not be subject to any preemptive or similar rights.
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(k) Each of the Guarantors has all requisite corporate, limited
liability company, partnership or limited liability partnership, as the
case may be, power and authority to execute, issue and deliver the
Subsidiary Guarantees and perform its obligations thereunder. The
Subsidiary Guarantees have been duly authorized by each of the Guarantors
and when the Subsidiary Guarantees are duly endorsed on the Securities in
accordance with the terms of the Indenture and delivered to and paid for
by the Initial Purchasers pursuant to this Agreement on the Closing Date,
assuming due authorization of the Securities by the Trustee, such
Subsidiary Guarantees will constitute legally valid and binding
obligations of the respective Guarantors, entitled to the benefits of the
Indenture and enforceable against the respective Guarantors in accordance
with their terms, subject to applicable bankruptcy, fraudulent conveyance,
insolvency, reorganization, moratorium and similar laws affecting
creditors' rights generally and equitable principles of general
applicability and an implied covenant of good faith and fair dealing.
(l) The Company and each of the Guarantors have all requisite
corporate, limited liability company, partnership or limited liability
partnership, as the case may be, power and authority to enter into the
Indenture and the Registration Rights Agreement, and to perform their
respective obligations thereunder. Each of the Indenture and the
Registration Rights Agreement has been duly authorized, and when executed
and delivered by the Company and each of the Guarantors, will be a valid
and binding agreement of the Company and each of the Guarantors,
enforceable in accordance with its terms, subject to applicable
bankruptcy, fraudulent conveyance, insolvency, reorganization, moratorium
and similar laws affecting creditors' rights generally and equitable
principles of general applicability and an implied covenant of good faith
and fair dealing and except as rights to indemnification and contribution
under the Registration Rights Agreement may be limited by applicable law.
(m) The execution and delivery by the Company and each of the
Guarantors, and the performance by the Company and each of the Guarantors,
as the case may be, of their obligations under, this Agreement, the
Indenture, the Registration Rights Agreement, the Securities and the
Subsidiary Guarantees will not result in (i) the violation of any
provision of applicable law or the certificate of incorporation or by-laws
or other constitutive documents of the Company or any such Guarantor, or
any judgment, order or decree of any governmental body, agency or court
having jurisdiction over any such entity, or (ii) breach of, or default
under, any agreement or other instrument binding upon any such entity that
is material to the Company and its subsidiaries, considered together as
one enterprise, or to which any of the property or assets of any such
entity is subject, and no consent, approval, authorization or order of, or
qualification with, any governmental body or agency is required for the
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performance by any such entity of their respective obligations under this
Agreement, the Indenture, the Registration Rights Agreement, the
Securities and the Subsidiary Guarantees, as the case may be, except such
as may be required by the securities or Blue Sky laws of the various
states in connection with the offer and sale of the Securities, Subsidiary
Guarantees and Underlying Securities and by Federal and state securities
laws with respect to the conversion of the Securities and the obligations
of the Company and the Guarantors under the Registration Rights Agreement.
(n) The subsidiaries of the Company set forth on Schedule II hereto
comprise approximately 64% of the Company's total revenue under generally
accepted accounting principles in the United States for the fiscal year
ended September 30, 2004, as reported in the Company's annual report on
Form 10-K for such fiscal year, and no other subsidiary of the Company
represented greater than 3% of the Company's total revenue under generally
accepted accounting principles in the United States for such fiscal year.
(o) Except for the registration rights contained in the Registration
Rights Agreement, the Company has not granted or agreed to grant to any
Person any rights (including "piggy-back" registration rights) to have any
securities of the Company registered with the Commission or any other
governmental authority that have not been satisfied.
(p) There are no voting agreements, voting trusts, proxies or other
agreements or understandings with respect to the voting of any capital
stock of the Company or any of its subsidiaries to which the Company or
any of its subsidiaries is a party.
(q) Except as otherwise disclosed in the Memorandum, subsequent to
the respective dates as of which information is given in the Memorandum,
(i) there has not occurred any material adverse change in the condition,
financial or otherwise, or in the earnings, business affairs or business
prospects of the Company and its subsidiaries, considered together as one
enterprise, whether or not arising in the ordinary course of business;
(ii) the Company and its subsidiaries, considered as one entity, have not
incurred any material liability or obligation, indirect, direct or
contingent, not in the ordinary course of business nor entered into any
material transaction or agreement not in the ordinary course of business;
and (iii) there has been no dividend or distribution of any kind declared,
paid or made by the Company or, except for dividends paid to the Company
or its subsidiaries, any of its subsidiaries on any class of capital stock
or repurchase or redemption by the Company or any of its subsidiaries of
any class of capital stock.
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(r) None of the Company or any of its subsidiaries is (i) in
violation of its charter or by-laws or its partnership or operating
agreement, as applicable; (ii) in default, and no event has occurred
which, with notice or the lapse of time or both, would constitute such a
default, in the due performance or observance of any obligation,
agreement, covenant or condition contained in any indenture, loan
agreement, mortgage, lease or other agreement or instrument that is
material to the Company and its subsidiaries, considered together as one
enterprise and to which such entity is a party or by which such entity or
its property is bound; or (iii) to the knowledge of the Company, is in
violation in any respect of any law, ordinance, governmental rule,
regulation or court decree to which it or its property or assets may be
subject, except for such defaults that would not, singly or in the
aggregate, have a Material Adverse Effect.
(s) No subsidiary of the Company is currently prohibited, directly
or indirectly, from paying dividends to the Company, from making any other
distribution on such subsidiary's capital stock, from repaying to the
Company any loans or advances to such subsidiary from the Company or from
transferring any of such subsidiary's property or assets to the Company or
any other subsidiary of the Company, except as described in the
Memorandum.
(t) There are no legal or governmental proceedings pending or, to
the knowledge of the Company, threatened to which the Company or any of
its subsidiaries is a party or to which any of the properties of such
entity is subject other than proceedings accurately described in all
material respects in the Memorandum and proceedings that would not have a
Material Adverse Effect or a material adverse effect on the ability of the
Company or any of the Guarantors to perform their respective obligations
under the Purchase Agreement, the Indenture, the Registration Rights
Agreement, the Securities and the Subsidiary Guarantees or to consummate
the transactions contemplated therein.
(u) The Company and each of its subsidiaries (i) are in compliance
with any and all applicable foreign, federal, state and local laws and
regulations relating to the protection of human health and safety, the
environment or hazardous or toxic substances or wastes, pollutants or
contaminants ("ENVIRONMENTAL LAWS"), (ii) have received all permits,
licenses or other approvals required of it under applicable Environmental
Laws to conduct their respective businesses, (iii) are in compliance with
all terms and conditions of any such permit, license or approval, (iv) are
in compliance with any applicable provision of the Employee Retirement
Income Security Act of 1974, as amended, ("ERISA") or the rules and
regulations promulgated thereunder and (v) are in compliance with any
applicable provision of the Foreign Corrupt Practice Act of 1977, as
amended, or the rules and regulations promulgated thereunder, except where
such noncompliance with Environmental Laws, failure to receive
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required permits, licenses or other approvals, failure to comply with the
terms and conditions of such permits, licenses or approvals, or
noncompliance with ERISA or the Foreign Corrupt Practices Act of 1977, as
amended, would not in each case, singly or in the aggregate, have a
Material Adverse Effect.
(v) There are no costs or liabilities associated with Environmental
Laws (including, without limitation, any capital or operating expenditures
required for clean-up, closure of properties or compliance with
Environmental Laws or any permit, license or approval, any related
constraints on operating activities and any potential liabilities to third
parties) which would, singly or in the aggregate, have a Material Adverse
Effect.
(w) The Company is not, and after giving effect to the offering and
sale of the Securities and the application of the proceeds thereof as
described in the Memorandum will not be, an "investment company" as such
term is defined in the Investment Company Act of 1940, as amended.
(x) Neither the Company nor any of its affiliates (as defined in
Rule 501(b) of Regulation D under the Securities Act, each an "AFFILIATE")
has directly, or through any agent, (i) sold, offered for sale, solicited
offers to buy or otherwise negotiated in respect of, any security (as
defined in the Securities Act) which is or will be integrated with the
sale of the Securities in a manner that would require the registration
under the Securities Act of the Securities, the Underlying Securities and
the Subsidiary Guarantees or (ii) offered, solicited offers to buy or sold
the Securities by any form of general solicitation or general advertising
(as those terms are used in Regulation D under the Securities Act) or in
any manner involving a public offering within the meaning of Section 4(2)
of the Securities Act.
(y) Based on the representations and warranties of the Initial
Purchasers and compliance with the covenants by the Initial Purchasers as
set forth in Section 7 of this Agreement, it is not necessary in
connection with the offer, sale and delivery of the Securities to the
Initial Purchasers in the manner contemplated by this Agreement to
register the Securities, the Subsidiary Guarantees or the Underlying
Securities under the Securities Act or to qualify the Indenture under the
Trust Indenture Act of 1939, as amended.
(z) The Securities satisfy the requirements set forth in Rule
144A(d)(3) under the Securities Act.
(aa) The Company has established and maintained disclosure controls
and procedures (as defined in Exchange Act Rules 13a-15 and 15d-15) which
(i) are designed to ensure that material information relating to the
Company and its subsidiaries is made known to its chief executive
8
officer and chief financial officer by others within the Company and its
subsidiaries; (ii) have been evaluated for effectiveness as of the date of
the most recent annual and quarterly reports of the Company; and (iii) are
effective in all material respects to perform the functions for which they
were established.
(bb) Based on the evaluation of its disclosure controls and
procedures, and other than as disclosed in the Company's quarterly report
for the quarter ended December 31, 2004, the Company is not aware of (i)
any significant deficiency in the design or operation of its internal
controls which could adversely affect its ability to record, process,
summarize and report financial data or any material weaknesses in internal
controls; or (ii) any fraud, whether or not material, that involves
management or other employees who have a significant role in its internal
controls.
(cc) Since the date of the most recent evaluation of such disclosure
controls and procedures, and other than as disclosed in the Company's
quarterly report for the quarter ended December 31, 2004, there have been
no significant changes in internal controls or in other factors that could
significantly affect internal controls, including any corrective actions
with regard to significant deficiencies and material weaknesses.
(dd) The Company has complied and will comply with the currently
applicable provisions of the Xxxxxxxx-Xxxxx Act of 2002, and to the best
of the Company's knowledge, its directors and officers in their capacities
as such have complied and will comply with the currently applicable
provisions of the Xxxxxxxx-Xxxxx Act of 2002.
(ee) The books, records and accounts of the Company and each of its
subsidiaries accurately and fairly reflect, in reasonable detail, the
transactions in, and dispositions of, the assets of, and the results of
operations of, such entity. The Company and each of its subsidiaries,
taken as a whole, maintain a system of accounting controls sufficient to
provide reasonable assurances that (a) transactions are executed in
accordance with management's general or specific authorization, (b)
transactions are recorded as necessary to permit preparation of financial
statements in conformity with generally accepted accounting principles in
the United States and to maintain accountability for assets and (c) access
to assets is permitted only in accordance with management's general or
specific authorization.
(ff) The Company and each of its subsidiaries own or possess, or own
or possess licenses or other rights to use, all material patents, patent
rights, licenses, inventions, copyrights, know-how (including trade
secrets and other unpatented and/or unpatentable proprietary or
confidential information, systems or procedures), trademarks, service
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marks and trade names (collectively, the "INTELLECTUAL PROPERTY")
currently employed or required by such entity in connection with the
business currently conducted by such entity as described in the
Memorandum, except such as the failure to so own or possess would not
have, singly or in the aggregate, a Material Adverse Effect.
(gg) The Company and each of its subsidiaries have all material
permits, licenses, consents, exemptions, franchises, authorizations and
other approvals (each, an "AUTHORIZATION") of, and have made all filings
with and notices to, all appropriate federal, state, local or foreign
governmental or regulatory authorities and self regulatory organizations
and all courts and other tribunals, as are necessary to own, lease,
license and operate their respective properties and to conduct their
respective businesses, except to the extent the failure to have any such
Authorization or to make any such filing or notice would not, singly or in
the aggregate, have a Material Adverse Effect. Each such Authorization is
valid and in full force and effect and such entity is in compliance with
all the terms and conditions thereof and with the rules and regulations of
the authorities and governing bodies having jurisdiction with respect
thereto; and no event has occurred (including, without limitation, the
receipt of any notice from any authority or governing body) which allows
or, after notice or lapse of time or both, would allow, revocation,
suspension or termination of any such Authorization or results or, after
notice or lapse of time or both, would result in any other impairment of
the rights of the holder of any such Authorization; and such
Authorizations contain no restrictions that are burdensome to such entity;
except to the extent such failure to be valid and in full force and effect
or to be in compliance, the occurrence of any such event or the presence
of any such restriction would not, singly or in the aggregate, have a
Material Adverse Effect.
(hh) There are no outstanding subscriptions, rights, warrants,
options, calls or convertible securities, granted or issued by the Company
or any of its subsidiaries relating to or entitling any person to purchase
or otherwise to acquire any shares of the capital stock of such entity,
except for options and restricted stock granted to directors and employees
of the Company in the ordinary course of business or as described in the
Memorandum.
(ii) The financial statements of the Company included or
incorporated by reference in the Memorandum, together with related
schedules and notes, present fairly the financial position, results of
operations and changes in financial position of the Company on the basis
stated therein at the respective dates or for the respective periods to
which they apply; such statements and related schedules and notes have
been prepared in accordance with generally accepted accounting principles
in the United States consistently applied throughout the periods involved;
and the other financial and statistical information and data of the
Company
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set forth in the Memorandum are, in all material respects, accurately
presented and prepared on a basis consistent with such financial
statements and the books and records of the Company. The financial
information relating to the Company set forth under the captions "Summary-
Summary Financial and Operating Data" and "Capitalization" in the
Memorandum are derived from the accounting records of the Company and its
subsidiaries and fairly present, on the basis stated in the Memorandum,
the information included therein. The pro forma financial information of
the Company and its subsidiaries included or incorporated by reference in
the Memorandum present fairly the information contained therein, have been
prepared in accordance with the Commission's rules and guidelines with
respect to pro forma financial information and have been properly
presented on the bases described therein, and the assumptions used in the
preparation thereof are reasonable and the adjustments used therein are
appropriate to give effect to the transactions and circumstances referred
to therein.
(jj) KPMG LLP, who have certified certain financial statements of
the Company, whose reports appear or are incorporated by reference in the
Memorandum and who have delivered the letters referred to in Section 7
hereof, are independent public accountants as required by the Securities
Act and the rules and regulations of the Commission.
(kk) There are no existing or, to the knowledge of the Company,
threatened labor disputes with the employees of the Company or any of its
subsidiaries which would have a Material Adverse Effect.
(ll) The statements relating to legal matters, documents or
proceedings included in the Memorandum under the captions "Description of
Capital Stock", "Business -- Revenue Sources" and "Business -- Government
Regulation" and in "Item 3 -- Legal Proceedings" of the Company's most
recent annual report on Form 10-K incorporated by reference in the
Memorandum, and in "Part II Item 1 -- Legal Proceedings" of the Company's
most recent quarterly report on Form 10-Q incorporated by reference in the
Memorandum, insofar as such descriptions constitute a summary of the legal
matters, documents or proceedings referred to therein, fairly summarize in
all material respects such matters, documents or proceedings.
(mm) Neither the Company, nor to its knowledge, any of its officers,
directors or affiliates has taken, or will take, directly or indirectly,
any action designed to or which might reasonably be expected to cause or
result in, or which has constituted or which might reasonably be expected
to constitute, the stabilization or manipulation of the price of the
Common Stock or any security convertible into or exchangeable for Common
Stock to facilitate the sale or resale of any of the Securities.
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(nn) The Company and each of its subsidiaries have filed all
Federal, state, local and foreign tax returns which are required to be
filed through the date hereof (except where the failure to so file would
not be reasonably likely to have a Material Adverse Effect), which returns
are true and correct in all material respects, or have received extensions
thereof, and have paid all taxes shown on such returns and all assessments
received by them to the extent that the same are material and have become
due. There are no tax audits or investigations pending, which if adversely
determined, would have a Material Adverse Effect.
(oo) The Company and each of its subsidiaries are insured against
such losses and risks and in such amounts containing such deductibles and
covering such risks as are customary in the businesses in which they are
engaged. None of the Company or any of its subsidiaries has reason to
believe that it will not be able to renew its existing insurance coverage
as and when such coverage expires or to obtain similar coverage from
similar insurers as may be necessary to continue its business at a cost
that would not have a Material Adverse Effect.
(pp) None of the Company or any of its subsidiaries or, to the
knowledge of the Company and its subsidiaries, any other person associated
with or acting on behalf of such entity including, without limitation, any
director, officer, agent or employee of such entity has, directly or
indirectly, while acting on behalf of such entity (i) used any corporate
funds for unlawful contributions, gifts, entertainment or other unlawful
expenses relating to political activity; (ii) made any unlawful payment to
foreign or domestic government officials or employees or to foreign or
domestic political parties or campaigns from corporate funds; (iii)
violated any provision of the Foreign Corrupt Practices Act of 1977, as
amended; or (iv) made any other unlawful payment.
(qq) The Company and each of its subsidiaries have good and
marketable title in fee simple to all real property and good and
marketable title to all personal property owned by such entity, in each
case free and clear of all liens, encumbrances and defects, other than
mortgages with respect to real property owned by the Company or its
subsidiaries in the ordinary course of business, except such as are
described in the Memorandum or such as would not have a Material Adverse
Effect. Any real property and buildings held under lease by such entity is
held by it under valid, subsisting and enforceable leases with such
exceptions as are not material and do not interfere with the use made and
proposed to be made of such property and buildings by such entity.
(rr) The industry, statistical and market-related data included or
incorporated by reference in the Memorandum are derived from sources that
the Company reasonably and in good faith believes to be accurate,
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reasonable and reliable, and such data agrees with the sources from which
they were derived.
(ss) The Indenture, the Registration Rights Agreement, the
Securities, the Underlying Securities and the Subsidiary Guarantees will
conform as of the Closing Date in all material respects to the
descriptions thereof contained in the Memorandum.
(tt) There is no document, contract or other agreement of a
character required to be filed under the Exchange Act which is not
described or filed as required by the Exchange Act or the rules and
regulations of the Commission thereunder. Each description of a contract,
document or other agreement in the Memorandum fairly reflects in all
respects the material terms of the underlying document, contract or
agreement. Each agreement described in the Memorandum or incorporated by
reference is in full force and effect and is valid and enforceable by and
against the Company or a subsidiary, as the case may be, in accordance
with its terms.
(uu) Each certificate signed by any officer of the Company or any
Guarantor and delivered to the Initial Purchasers or counsel to the
Initial Purchasers shall be deemed to be a representation and warranty by
the Company or such Guarantor to the Initial Purchasers as to the matters
covered thereby.
2. Agreements to Sell and Purchase. The Company hereby agrees to sell to
the several Initial Purchasers, and each Initial Purchaser, upon the basis of
the representations and warranties herein contained, but subject to the
conditions hereinafter stated, agrees, severally and not jointly, to purchase
from the Company the respective principal amount of Firm Securities set forth in
Schedule I hereto opposite its name at a purchase price of 97.3% of the
principal amount thereof (the "PURCHASE PRICE").
On the basis of the representations and warranties contained in this
Agreement, and subject to its terms and conditions, the Company agrees to sell
to the Initial Purchasers the Additional Securities, and the Initial Purchasers
shall have the right to purchase, severally and not jointly, up to $30,000,000
principal amount of Additional Securities at the Purchase Price plus accrued
interest, if any, to the date of payment and delivery. You may exercise this
right on behalf of the Initial Purchasers in whole or from time to time in part
by giving written notice not later than 30 days after the Closing Date. Any
exercise notice shall specify the principal amount of Additional Securities to
be purchased by the Initial Purchasers and the date on which such Additional
Securities are to be purchased. Each purchase date must be at least one business
day after the written notice is given and may not be earlier than the closing
date for the Firm Securities nor later than ten business days after the date of
such notice. On each day, if any, that Additional Securities are to be purchased
(an "OPTION CLOSING DATE"), each
13
Initial Purchaser agrees, severally and not jointly, to purchase the principal
amount of Additional Securities (subject to such adjustments to eliminate
fractional Securities as you may determine) that bears the same proportion to
the total principal amount of Additional Securities to be purchased on such
Option Closing Date as the principal amount of Firm Securities set forth in
Schedule I opposite the name of such Initial Purchaser bears to the total
principal amount of Firm Securities.
The Company hereby agrees that, without the prior written consent of the
Representative, on behalf of the Initial Purchasers, it will not, during the
period ending 90 days after the date of the Memorandum, (i) offer, pledge, sell,
contract to sell, sell any option or contract to purchase, purchase any option
or contract to sell, grant any option, right or warrant to purchase, lend, or
otherwise transfer or dispose of, directly or indirectly, any shares of Common
Stock or any securities convertible into or exercisable or exchangeable for
Common Stock or (ii) enter into any swap or other arrangement that transfers to
another, in whole or in part, any of the economic consequences of ownership of
the Common Stock, whether any such transaction described in clause (i) or (ii)
above is to be settled by delivery of Common Stock or such other securities, in
cash or otherwise. The foregoing sentence shall not apply to (A) the sale of the
Securities under this Agreement, (B) the granting of options and restricted
stock pursuant to the Company's employee benefit plans existing on the date
hereof or (C) the issuance by the Company of any shares of Common Stock upon the
exercise of an option or warrant or the conversion of a security outstanding on
the date hereof of which the Initial Purchasers have been advised in writing.
3. Terms of Offering. You have advised the Company that the Initial
Purchasers will make an offering of the Securities purchased by the Initial
Purchasers hereunder on the terms to be set forth in the Memorandum, as soon as
practicable after this Agreement is entered into as in your judgment is
advisable.
4. Payment and Delivery. Payment for the Firm Securities shall be made to
the Company in Federal or other funds immediately available in New York City
against delivery of such Firm Securities for the respective accounts of the
several Initial Purchasers at 10:00 a.m., New York City time, on March 2, 2005,
or at such other time on the same or such other date, not later than March 14,
2005, as shall be agreed upon by the Company and you. The time and date of such
payment are hereinafter referred to as the "CLOSING DATE."
Payment for any Additional Securities shall be made to the Company in
Federal or other funds immediately available in New York City against delivery
of such Additional Securities for the respective accounts of the several Initial
Purchasers at 10:00 a.m., New York City time, on the date specified in the
corresponding notice described in Section 2 or at such other time on the same or
on such other date, in any event not later than April 11, 2005 as shall be
agreed upon by the Company and you.
14
The Securities shall be in definitive form or global form, as specified by
you, and registered in such names and in such denominations ($1,000 or integral
multiples of $1,000 in excess thereof) as you shall request in writing not later
than one full business day prior to the Closing Date or the applicable Option
Closing Date, as the case may be. The Securities shall be delivered to you on
the Closing Date or an Option Closing Date, as the case may be, for the account
of the Initial Purchaser, with any transfer taxes payable in connection with the
transfer of the Securities to the Initial Purchaser duly paid, against payment
of the Purchase Price therefor plus accrued interest, if any, to the date of
payment and delivery.
5. Conditions to the Initial Purchasers' Obligations. The several
obligations of the Initial Purchasers to purchase and pay for the Firm
Securities are subject to the accuracy, when made and on the Closing Date, of
the representations and warranties of the Company and each of the Guarantors, to
the performance by the Company and each of the Guarantors of their respective
obligations hereunder and to each of the following additional terms and
conditions:
(a) Subsequent to the execution and delivery of this Agreement and
prior to the Closing Date:
(i) there shall not have occurred any downgrading, nor shall
any notice have been given of any intended or potential downgrading
or of any review for a possible change that does not indicate the
direction of the possible change, in the rating accorded the Company
or any of the Company's securities or in the rating outlook for the
Company by any "nationally recognized statistical rating
organization," as such term is defined for purposes of Rule
436(g)(2) under the Securities Act; and
(ii) there shall not have occurred any change, or any
development involving a prospective change, in the condition,
financial or otherwise, or in the earnings, business or operations
of the Company and its subsidiaries taken as one enterprise, from
that set forth in the Memorandum provided to prospective purchasers
of the Securities that, in your judgment, is material and adverse
and that makes it, in your judgment, impracticable to market the
Securities on the terms and in the manner contemplated in the
Memorandum.
(b) The Initial Purchasers shall have received on the Closing Date a
certificate, dated the Closing Date and signed by an executive officer of
the Company, to the effect set forth in Section 5(a)(i) and to the effect
that the representations and warranties of the Company and of the
Guarantors contained in this Agreement are true and correct as of the
Closing Date and that the Company and each of the Guarantors have complied
with all of the agreements and satisfied all of the conditions on
15
their part to be performed or satisfied hereunder on or before the Closing
Date.
The officer signing and delivering such certificate may rely upon
the best of his or her knowledge as to proceedings threatened.
(c) The Initial Purchasers shall have received on the Closing Date
an opinion of (i) Blank Rome LLP, outside counsel for the Company, dated
the Closing Date, to the effect set forth in Exhibit A and (ii) Xxxxxx
Xxxxxxx LLP, New Hampshire outside counsel for the Company, relating to
certain matters regarding XxXxxxxx Health Care Centers, Inc. Such opinions
shall be rendered to the Initial Purchasers at the request of the Company
and shall so state therein.
(d) The Initial Purchasers shall have received on the Closing Date
an opinion of Xxxxx Xxxx & Xxxxxxxx, counsel for the Initial Purchasers,
dated the Closing Date, to the effect set forth in Exhibit B.
(e) The Initial Purchasers shall have received on each of the date
hereof and the Closing Date a letter, dated the date hereof or the Closing
Date, as the case may be, in form and substance satisfactory to the
Initial Purchasers, from KPMG LLP, independent public accountants, with
respect to the financial information contained in the Memorandum relating
to the Company, containing statements and information of the type
ordinarily included in accountants' "comfort letters" to underwriters with
respect to the financial statements and certain financial information
contained in or incorporated by reference into each Memorandum; provided
that, in the case of the letter delivered on the Closing Date, such letter
shall use a "cut-off date" not earlier than the date hereof.
(f) The "lock-up" agreements, each substantially in the form of
Exhibit C hereto, between you and each of the executive officers of the
Company listed on Schedule III hereto relating to sales and certain other
dispositions of shares of Common Stock or certain other securities,
delivered to you on or before the date hereof, shall be in full force and
effect on the Closing Date.
(g) The Company and the Trustee shall have entered into the
Indenture, and the Initial Purchasers shall have received counterparts,
conformed as executed, thereof, and the Securities shall have been duly
executed and delivered by the Company and authenticated by the Trustee.
(h) The Company, the Initial Purchasers and the Guarantors shall
have entered into the Registration Rights Agreement.
(i) The Company and the Lenders party thereto shall have entered
into the Amended and Restated Credit Agreement (as defined in the
Memorandum).
16
The several obligations of the Initial Purchasers to purchase Additional
Securities hereunder are subject to the delivery to you on the applicable Option
Closing Date of such documents as you may reasonably request with respect to the
good standing of the Company and the Guarantors, the due authorization,
execution and authentication of the Additional Securities (including the
Subsidiary Guarantees) to be sold on such Option Closing Date and other matters
as you may reasonably request.
6. Covenants of the Company. In further consideration of the agreements of
the Initial Purchasers contained in this Agreement, the Company and each of the
Guarantors covenant with each Initial Purchaser as follows:
(a) The Company will furnish to you in New York City, without
charge, as soon as available on the business day next succeeding the date
of this Agreement and during the period mentioned in Section 6(b), as many
copies of the Memorandum, any documents incorporated by reference therein
and any supplements and amendments thereto as you may reasonably request.
(b) Before amending or supplementing the Memorandum, the Company will
furnish to you a copy of each such proposed amendment or supplement and
will not use any such proposed amendment or supplement to which you
reasonably object.
(b) Before amending or supplementing the Memorandum, the Company
will furnish to you a copy of each such proposed amendment or supplement
and will not use any such proposed amendment or supplement to which you
reasonably object.
(c) If, during such period after the date hereof and prior to the
date on which all of the Securities shall have been sold by the Initial
Purchasers, any event shall occur or condition exist as a result of which
it is necessary in the reasonable opinion of either the Company or the
Initial Purchasers to amend or supplement the Memorandum in order to make
the statements therein, in the light of the circumstances when the
Memorandum is delivered to a purchaser, not misleading, or to amend or
supplement the Memorandum to comply with applicable law, the Company will
prepare and furnish, at its own expense, to the Initial Purchasers, either
amendments or supplements to the Memorandum so that the statements in the
Memorandum as so amended or supplemented will not, in the light of the
circumstances when the Memorandum is delivered to a purchaser, be
misleading or so that the Memorandum, as amended or supplemented, will
comply with applicable law.
(d) The Company will promptly from time to time take such action as
the Initial Purchasers may reasonably request to qualify the Securities
for offer and sale under the securities or Blue Sky laws of such
jurisdictions as you shall reasonably request.
(e) Whether or not the transactions contemplated in this Agreement
are consummated or this Agreement is terminated, the Company shall pay or
cause to be paid all expenses incident to the
17
performance of its obligations under this Agreement, including: (i) the
fees, disbursements and expenses of the Company's counsel and accountants
in connection with the issuance and sale of the Securities and all other
fees or expenses in connection with the preparation of each Memorandum and
all amendments and supplements thereto, including all printing costs
associated therewith, and the delivering of copies thereof to the Initial
Purchasers, in the quantities herein above specified, (ii) all costs and
expenses related to the transfer and delivery of the Securities to the
Initial Purchasers, including any transfer or other taxes payable thereon,
(iii) the cost of printing or producing any Blue Sky or legal investment
memorandum in connection with the offer and sale of the Securities under
state securities laws and all expenses in connection with the
qualification of the Securities for offer and sale under state securities
laws as provided in Section 6(d) hereof, including filing fees and the
reasonable fees and disbursements of counsel for the Initial Purchasers in
connection with such qualification and in connection with the Blue Sky or
legal investment memorandum, (iv) any fees charged by rating agencies for
the rating of the Securities, (v) the fees and expenses, if any, incurred
in connection with the admission of the Securities for trading in PORTAL
or any appropriate market system, (vi) the costs and charges of the
Trustee and any transfer agent, registrar or depositary, (vii) the cost of
the preparation, issuance and delivery of the Securities, (viii) the costs
and expenses of the Company relating to investor presentations on any
"road show" undertaken in connection with the marketing of the offering of
the Securities, including, without limitation, expenses associated with
the production of road show slides and graphics, fees and expenses of any
consultants engaged in connection with the road show presentations with
the prior approval of the Company, travel and lodging expenses of the
representatives and officers of the Company and any such consultants, (ix)
the document production charges and expenses associated with printing this
Agreement and (x) all other costs and expenses incident to the performance
of the obligations of the Company hereunder for which provision is not
otherwise made in this Section. It is understood, however, that except as
provided in this Section, Section 8, and the last paragraph of Section 10,
the Initial Purchasers will pay all of their costs and expenses, including
fees and disbursements of their counsel, transfer taxes payable on resale
of any of the Securities by them and any advertising expenses connected
with any offers they may make.
(f) Neither the Company nor any affiliate will sell, offer for sale
or solicit offers to buy or otherwise negotiate in respect of any security
(as defined in the Securities Act) which could be integrated with the sale
of the Securities in a manner which would require the registration under
the Securities Act of the Securities.
(g) The Company will not solicit any offer to buy or offer to sell
the Securities, the Subsidiary Guarantees or the Underlying Securities
18
by means of any form of general solicitation or general advertising (as
those terms are used in Regulation D under the Securities Act) or in any
manner involving a public offering within the meaning of Section 4(2) of
the Securities Act.
(h) While any of the Securities, the Subsidiary Guarantees or the
Underlying Securities remain "restricted securities" within the meaning of
the Securities Act, the Company will make available, upon request, to any
seller of such securities the information specified in Rule 144A(d)(4)
under the Securities Act, unless the Company is then subject to Section 13
or 15(d) of the Exchange Act.
(i) The Company will use its reasonable best efforts to permit the
Securities to be designated PORTAL securities in accordance with the rules
and regulations adopted by the National Association of Securities Dealers,
Inc. relating to trading in the PORTAL Market and to permit the Securities
to be eligible for clearance and settlement through the Depository Trust
Company.
(j) During the period of two years after the Closing Date or any
Option Closing Date, if later, the Company will not, and will not permit
any of its affiliates (as defined in Rule 144 under the Securities Act) to
resell any of the Securities, the Subsidiary Guarantees or the Underlying
Securities which constitute "restricted securities" under Rule 144 that
have been reacquired by any of them.
(k) The Company will apply the proceeds from the sale of the
Securities as set forth under "Use of Proceeds" in the Offering
Memorandum.
(l) The Company will not take any action prohibited by Regulation M
under the Exchange Act in connection with the distribution of the
Securities contemplated hereby.
(m) The Company and the Guarantors will do and perform all things
required or necessary to be done and performed under this Agreement by
them prior to the Closing Date, and to satisfy all conditions precedent to
the Initial Purchasers' obligations hereunder to purchase the Securities.
7. Offering of Securities; Restrictions on Transfer. Each Initial
Purchaser, severally and not jointly, represents and warrants that (i) such
Initial Purchaser is a qualified institutional buyer as defined in Rule 144A
under the Securities Act (a "QIB"), (ii) such Initial Purchaser is purchasing
the Securities pursuant to a private sale exemption from registration under the
Securities Act, and (iii) such Initial Purchaser is not acquiring the Securities
(a) with a view to any distribution thereof or (b) with any present intention of
offering or selling the
19
Securities, in the case of either (a) or (b), in a transaction that would
violate the Securities Act or any state securities laws. Each Initial Purchaser,
severally and not jointly, agrees with the Company that (i) it will not solicit
offers for, or offer or sell, such Securities by any form of general
solicitation or general advertising (as those terms are used in Regulation D
under the Securities Act) or in any manner involving a public offering within
the meaning of Section 4(2) of the Securities Act and (ii) it will solicit
offers for such Securities only from, and will offer such Securities only to,
persons that it reasonably believes to be QIBs that in purchasing such
Securities are deemed to have represented and agreed as provided in the
Memorandum under the caption "Transfer Restrictions".
8. Indemnity and Contribution. (a) The Company and each of the Guarantors
agree to jointly and severally indemnify and hold harmless each Initial
Purchaser, its directors, officers and employees and each person, if any, who
controls any Initial Purchaser within the meaning of either Section 15 of the
Securities Act or Section 20 of the Exchange Act, and each affiliate of any
Initial Purchaser within the meaning of Rule 405 under the Securities Act from
and against any and all losses, claims, damages and liabilities (including,
without limitation, any legal or other expenses reasonably incurred in
connection with defending or investigating any such action or claim) caused by
any untrue statement or alleged untrue statement of a material fact contained in
the Memorandum (as amended or supplemented if the Company shall have furnished
any amendments or supplements thereto), or caused by any omission or alleged
omission to state therein a material fact necessary to make the statements
therein in the light of the circumstances under which they were made not
misleading, except insofar as such losses, claims, damages or liabilities are
caused by any such untrue statement or omission or alleged untrue statement or
omission based upon information relating to any Initial Purchaser furnished to
the Company in writing by such Initial Purchaser through you expressly for use
therein, provided, however, that the foregoing indemnity agreement with respect
to any Preliminary Memorandum shall not inure to the benefit of the Initial
Purchaser from whom the person asserting any such losses, claims, damages or
liabilities purchased Securities, or any person controlling the Initial
Purchaser, if a copy of the Memorandum (as then amended or supplemented if the
Company shall have furnished any amendments or supplements thereto) was not sent
or given by or on behalf of the Initial Purchaser to such person, if required by
law so to have been delivered, at or prior to the written confirmation of the
sale of the Securities to such person, and if the Memorandum (as so amended or
supplemented) would have cured the defect giving rise to such losses, claims,
damages or liabilities, unless such failure is the result of noncompliance by
the Company with Section 6(c) hereof.
(b) Each Initial Purchaser agrees, severally and not jointly, to indemnify
and hold harmless the Company and each Guarantor and their respective directors,
officers and employees and each person, if any, who controls the Company or any
such Guarantor within the meaning of either Section 15 of the Securities Act or
Section 20 of the Exchange Act to the same extent as the
20
foregoing indemnity from the Company and the Guarantors to such Initial
Purchaser, but only with reference to information relating to such Initial
Purchaser furnished to the Company and the Guarantors in writing by such Initial
Purchaser through you expressly for use in the Memorandum or any amendments or
supplements thereto.
(c) In case any proceeding (including any governmental investigation)
shall be instituted involving any person in respect of which indemnity may be
sought pursuant to Section 8(a) or 8(b), such person (the "INDEMNIFIED PARTY")
shall promptly notify the person against whom such indemnity may be sought (the
"INDEMNIFYING PARTY") in writing and the indemnifying party, upon request of the
indemnified party, shall retain counsel reasonably satisfactory to the
indemnified party to represent the indemnified party and any others the
indemnifying party may designate in such proceeding and shall pay the fees and
disbursements of such counsel related to such proceeding. In any such
proceeding, any indemnified party shall have the right to retain its own
counsel, but the fees and expenses of such counsel shall be at the expense of
such indemnified party unless (i) the indemnifying party and the indemnified
party shall have mutually agreed to the retention of such counsel or (ii) the
named parties to any such proceeding (including any impleaded parties) include
both the indemnifying party and the indemnified party and representation of both
parties by the same counsel would be inappropriate due to actual or potential
differing interests between them. It is understood that the indemnifying party
shall not, in respect of the legal expenses of any indemnified party in
connection with any proceeding or related proceedings in the same jurisdiction,
be liable for the fees and expenses of more than one separate firm (in addition
to any local counsel) for all such indemnified parties and that all such fees
and expenses shall be reimbursed as they are incurred. Such firm shall be
designated in writing by the Representative, in the case of parties indemnified
pursuant to Section 8(a), and by the Company, in the case of parties indemnified
pursuant to Section 8(b). The indemnifying party shall not be liable for any
settlement of any proceeding effected without its written consent, but if
settled with such consent or if there be a final judgment for the plaintiff, the
indemnifying party agrees to indemnify the indemnified party from and against
any loss or liability by reason of such settlement or judgment. Notwithstanding
the foregoing sentence, if at any time an indemnified party shall have requested
an indemnifying party to reimburse the indemnified party for fees and expenses
of counsel as contemplated by the second and third sentences of this paragraph,
the indemnifying party agrees that it shall be liable for any settlement of any
proceeding effected without its written consent if (i) such settlement is
entered into more than 30 days after receipt by such indemnifying party of the
aforesaid request and (ii) such indemnifying party shall not have reimbursed the
indemnified party in accordance with such request prior to the date of such
settlement. No indemnifying party shall, without the prior written consent of
the indemnified party, effect any settlement of any pending or threatened
proceeding in respect of which any indemnified party is or could have been a
party and indemnity could have been sought hereunder by such indemnified party,
unless
21
such settlement includes an unconditional release of such indemnified party from
all liability on claims that are the subject matter of such proceeding.
(d) To the extent the indemnification provided for in Section 8(a) or 8(b)
is unavailable to an indemnified party or insufficient in respect of any losses,
claims, damages or liabilities referred to therein, then each indemnifying party
under such paragraph, in lieu of indemnifying such indemnified party thereunder,
shall contribute to the amount paid or payable by such indemnified party as a
result of such losses, claims, damages or liabilities (i) in such proportion as
is appropriate to reflect the relative benefits received by the Company and each
of the Guarantors on the one hand and the Initial Purchasers on the other hand
from the offering of the Securities or (ii) if the allocation provided by clause
8(d)(i) above is not permitted by applicable law, in such proportion as is
appropriate to reflect not only the relative benefits referred to in clause
8(d)(i) above but also the relative fault of the Company and each of the
Guarantors on the one hand and of the Initial Purchasers on the other hand in
connection with the statements or omissions that resulted in such losses,
claims, damages or liabilities, as well as any other relevant equitable
considerations. The relative benefits received by the Company and each of the
Guarantors on the one hand and the Initial Purchasers on the other hand in
connection with the offering of the Securities shall be deemed to be in the same
respective proportions as the net proceeds from the offering of the Securities
(before deducting expenses) received by the Company and each of the Guarantors
and the total discounts and commissions received by the Initial Purchasers, in
each case as set forth in the Memorandum, bear to the aggregate offering price
of the Securities. The relative fault of the Company and each of the Guarantors
on the one hand and of the Initial Purchasers on the other hand shall be
determined by reference to, among other things, whether the untrue or alleged
untrue statement of a material fact or the omission or alleged omission to state
a material fact relates to information supplied by the Company or any Guarantor
or by the Initial Purchasers and the parties' relative intent, knowledge, access
to information and opportunity to correct or prevent such statement or omission.
The Initial Purchasers' respective obligations to contribute pursuant to this
Section 8 are several in proportion to the respective principal amount of
Securities they have purchased hereunder, and not joint.
(e) The Company, the Guarantors and the Initial Purchasers agree that it
would not be just or equitable if contribution pursuant to this Section 8(d)
were determined by pro rata allocation (even if the Initial Purchasers were
treated as one entity for such purpose) or by any other method of allocation
that does not take account of the equitable considerations referred to in
Section 8(d). The amount paid or payable by an indemnified party as a result of
the losses, claims, damages and liabilities referred to in Section 8(d) shall be
deemed to include, subject to the limitations set forth above, any legal or
other expenses reasonably incurred by such indemnified party in connection with
investigating or defending any such action or claim. Notwithstanding the
provisions of this Section 8, no Initial Purchaser shall be required to
contribute any amount in excess of the amount by which the total price at which
the Securities resold by it in the initial
22
placement of such Securities were offered to investors exceeds the amount of any
damages that such Initial Purchaser has otherwise been required to pay by reason
of such untrue or alleged untrue statement or omission or alleged omission. No
person guilty of fraudulent misrepresentation (within the meaning of Section
11(f) of the Securities Act) shall be entitled to contribution from any person
who was not guilty of such fraudulent misrepresentation. The remedies provided
for in this Section 8 are not exclusive and shall not limit any rights or
remedies which may otherwise be available to any indemnified party at law or in
equity.
(f) The indemnity and contribution provisions contained in this Section 8
and the representations, warranties and other statements of the Company and the
Guarantors contained in this Agreement shall remain operative and in full force
and effect regardless of (i) any termination of this Agreement, (ii) any
investigation made by or on behalf of any Initial Purchaser, any person
controlling any Initial Purchaser or any affiliate of any Initial Purchaser or
by or on behalf of the Company, or any Guarantor or any of their respective
officers or directors or any person controlling the Company or any Guarantor and
(iii) acceptance of and payment for any of the Securities.
9. Termination. The Initial Purchasers may terminate this Agreement by
notice given by you to the Company, if after the execution and delivery of this
Agreement and prior to the Closing Date (i) trading generally shall have been
suspended or materially limited on, or by, as the case may be, any of the New
York Stock Exchange, the American Stock Exchange, the Nasdaq National Market,
the Chicago Board of Options Exchange, the Chicago Mercantile Exchange or the
Chicago Board of Trade, (ii) trading of any securities of the Company shall have
been suspended on any exchange or in any over-the-counter market, (iii) a
material disruption in securities settlement, payment or clearance services in
the United States shall have occurred, (iv) any moratorium on commercial banking
activities shall have been declared by Federal or New York State authorities or
(v) there shall have occurred any outbreak or escalation of hostilities, or any
change in financial markets or any calamity or crisis that, in your judgment, is
material and adverse and which, singly or together with any other event
specified in this clause (v), makes it, in your reasonable judgment,
impracticable or inadvisable to proceed with the offer, sale or delivery of the
Securities on the terms and in the manner contemplated in the Memorandum.
10. Effectiveness; Defaulting Initial Purchasers. This Agreement shall
become effective upon the execution and delivery hereof by the parties hereto.
If, on the Closing Date, or an Option Closing Date, as the case may be,
any one or more of the Initial Purchasers shall fail or refuse to purchase
Securities that it or they have agreed to purchase hereunder on such date, and
the aggregate principal amount of Securities which such defaulting Initial
Purchaser or Initial Purchasers agreed but failed or refused to purchase is not
more than one-tenth of the aggregate principal amount of Securities to be
purchased on such date, the other Initial Purchasers shall be obligated
severally in the proportions that the
23
principal amount of Firm Securities set forth opposite their respective names in
Schedule I bears to the aggregate principal amount of Firm Securities set forth
opposite the names of all such non-defaulting Initial Purchasers, or in such
other proportions as you may specify, to purchase the Securities which such
defaulting Initial Purchaser or Initial Purchasers agreed but failed or refused
to purchase on such date; provided that in no event shall the principal amount
of Securities that any Initial Purchaser has agreed to purchase pursuant to this
Agreement be increased pursuant to this Section 10 by an amount in excess of
one-ninth of such principal amount of Securities without the written consent of
such Initial Purchaser. If, on the Closing Date any Initial Purchaser or Initial
Purchasers shall fail or refuse to purchase Firm Securities which it or they
have agreed to purchase hereunder on such date and the aggregate principal
amount of Securities with respect to which such default occurs is more than
one-tenth of the aggregate principal amount of Firm Securities to be purchased
on such date, and arrangements satisfactory to you and the Company for the
purchase of such Firm Securities are not made within 36 hours after such
default, this Agreement shall terminate without liability on the part of any
non-defaulting Initial Purchaser or of the Company. In any such case either you
or the Company shall have the right to postpone the Closing Date, but in no
event for longer than seven days, in order that the required changes, if any, in
the Memorandum or in any other documents or arrangements may be effected. If, on
an Option Closing Date, any Initial Purchaser or Initial Purchasers shall fail
or refuse to purchase Additional Securities and the aggregate principal amount
of Additional Securities with respect to which such default occurs is more than
one-tenth of the aggregate principal amount of Additional Securities to be
purchased on such Option Closing Date, the non-defaulting Initial Purchasers
shall have the option to (a) terminate their obligation hereunder to purchase
the Additional Securities to be sold on such Option Closing Date or (b) purchase
not less than the principal amount of Additional Securities that such
non-defaulting Initial Purchasers would have been obligated to purchase in the
absence of such default. Any action taken under this paragraph shall not relieve
any defaulting Initial Purchaser from liability in respect of any default of
such Initial Purchaser under this Agreement.
If this Agreement shall be terminated by the Initial Purchasers, or any of
them, because of any failure or refusal on the part of the Company or any
Guarantor to comply with the terms or to fulfill any of the conditions of this
Agreement, or if for any reason the Company or any Guarantor shall be unable to
perform its obligations under this Agreement, the Company and each of the
Guarantors jointly and severally agree to reimburse the Initial Purchasers or
such Initial Purchasers as have so terminated this Agreement with respect to
themselves, severally, for all out-of-pocket expenses (including the fees and
disbursements of their counsel) reasonably incurred by such Initial Purchasers
in connection with this Agreement or the offering contemplated hereunder.
11. Notices. All communications hereunder shall be in writing and shall be
mailed, hand delivered or telecopied and confirmed to the parties hereto as
follows:
24
If to the Initial Purchasers:
Wachovia Capital Markets, LLC
000 Xxxxx Xxxxxxx Xxxxxx, 0xx Xxxxx
Xxxxxxxxx, Xxxxx Xxxxxxxx 00000-0000
Attention: Convertible Securities Syndication
Telecopy No.: (000) 000-0000
If to the Company and the Guarantors:
Genesis HealthCare Corporation
000 Xxxx Xxxxx Xxxxxx
Xxxxxxx Xxxxxx, Xxxxxxxxxxxx 00000
Attention: General Counsel
Telecopy No.: (000) 000-0000
The parties hereto may change the address for receipt of communications by
giving written notice to each other.
12. Counterparts. This Agreement may be signed in any number of
counterparts, each of which shall be an original, with the same effect as if the
signatures thereto and hereto were upon the same instrument.
13. Applicable Law. This Agreement shall be governed by and construed in
accordance with the internal laws of the State of New York.
14. Headings. The headings of the sections of this Agreement have been
inserted for convenience of reference only and shall not be deemed a part of
this Agreement.
25
Very truly yours,
THE COMPANY
GENESIS HEALTHCARE CORPORATION
By: /s/ Xxxxx X. XxXxxx
-----------------------------------------
Name: Xxxxx X. XxXxxx
Title: Chief Financial Officer
THE GUARANTORS
ACADEMY NURSING HOME, INC.
ADS APPLE VALLEY, INC.
ADS CONSULTING, INC.
ADS DANVERS ALF, INC.
ADS DARTMOUTH ALF, INC.
ADS HINGHAM ALF, INC.
ADS HINGHAM NURSING FACILITY, INC.
ADS HOME HEALTH, INC.
ADS MANAGEMENT, INC.
ADS PALM CHELMSFORD, INC.
ADS RECUPERATIVE CENTER, INC.
ADS RESERVOIR WALTHAM, INC.
ADS SENIOR HOUSING, INC.
ADS/MULTICARE, INC.
ANR, INC.
APPLE VALLEY OPERATING CORP.
APPLEWOOD HEALTH RESOURCES, INC.
ASL, INC.
ASSISTED LIVING ASSOCIATES OF BERKSHIRE, INC.
ASSISTED LIVING ASSOCIATES OF LEHIGH, INC.
ASSISTED LIVING ASSOCIATES OF SANATOGA, INC.
BERKS NURSING HOMES, INC.
BRIGHTWOOD PROPERTY, INC.
BRINTON MANOR, INC.
BURLINGTON XXXXX CONVALESCENT CENTER,INC.
CAREFLEET, INC.
CENTURY CARE MANAGEMENT, INC.
CHATEAU VILLAGE HEALTH RESOURCES, INC.
CHELTENHAM LTC MANAGEMENT, INC.
CHG INVESTMENT CORP., INC.
CHNR-I, INC.
COLONIAL HALL HEALTH RESOURCES, INC.
CONCORD HEALTH GROUP, INC.
CONCORD SERVICE CORPORATION
CRESTVIEW CONVALESCENT HOME, INC.
CRESTVIEW NORTH, INC.
CRYSTAL CITY NURSING CENTER, INC.
CVNR, INC.
XXXX VIEW MANOR, INC.
DELM NURSING, INC.
XXXXX XXXXXX AND ASSOCIATES, INC.
DOVER HEALTHCARE ASSOCIATES, INC.
EIDOS, INC.
ELDERCARE RESOURCES CORP.
ELMWOOD HEALTH RESOURCES, INC.
ENCARE OF PENNYPACK, INC.
ENCARE OF QUAKERTOWN, INC.
ENCARE OF WYNCOTE, INC.
ENR, INC.
GENESIS ELDERCARE CENTERS - BELVEDERE, INC.
GENESIS ELDERCARE CENTERS - CHAPEL MANOR, INC.
GENESIS ELDERCARE CENTERS-XXXXXXX, INC.
GENESIS ELDERCARE CENTERS - PENNSBURG, INC.
GENESIS ELDERCARE CORP.
GENESIS ELDERCARE DIAGNOSTIC SERVICES, INC.
GENESIS ELDERCARE HOME CARE SERVICES, INC.
GENESIS ELDERCARE HOSPITALITY SERVICES, INC.
GENESIS ELDERCARE LIVING FACILITIES, INC.
GENESIS ELDERCARE NATIONAL CENTERS, INC.
GENESIS ELDERCARE NETWORK SERVICES OF
MASSACHUSETTS, INC.
GENESIS ELDERCARE NETWORK SERVICES, INC.
GENESIS ELDERCARE PARTNERSHIP CENTERS, INC.
GENESIS ELDERCARE PHYSICIAN SERVICES, INC.
GENESIS ELDERCARE PROPERTIES, INC.
GENESIS ELDERCARE REHABILITATION SERVICES, INC.
GENESIS ELDERCARE STAFFING SERVICES, INC.
GENESIS ELDERCARE TRANSPORTATION SERVICES, INC.
GENESIS HEALTH VENTURES OF ARLINGTON, INC.
GENESIS HEALTH VENTURES OF BLOOMFIELD, INC.
GENESIS HEALTH VENTURES OF CLARKS SUMMIT, INC.
GENESIS HEALTH VENTURES OF INDIANA, INC.
GENESIS HEALTH VENTURES OF XXXXXX, INC.
GENESIS HEALTH VENTURES OF MASSACHUSETTS, INC.
GENESIS HEALTH VENTURES OF NAUGATUCK, INC.
GENESIS HEALTH VENTURES OF NEW GARDEN, INC.
GENESIS HEALTH VENTURES OF POINT PLEASANT, INC.
GENESIS HEALTH VENTURES OF SALISBURY, INC.
GENESIS HEALTH VENTURES OF XXXXX, INC.
GENESIS HEALTH VENTURES OF WEST VIRGINIA, INC.
GENESIS HEALTH VENTURES OF XXXXXX-XXXXX, INC.
GENESIS HEALTH VENTURES OF WINDSOR, INC.
GENESIS HEALTHCARE CENTERS HOLDINGS, INC.
GENESIS HEALTHCARE HOLDING COMPANY I, INC.
GENESIS HEALTHCARE HOLDING COMPANY II, INC.
GENESIS IMMEDIATE MED CENTER, INC.
GENESIS OF PALISADO AVENUE, INC.
GENESIS PROPERTIES OF DELAWARE CORPORATION
GENESIS SELECTCARE CORP.
GENESIS/VNA PARTNERSHIP HOLDING COMPANY, INC.
GERIATRIC & MEDICAL COMPANIES, INC.
GERIATRIC AND MEDICAL INVESTMENTS CORPORATION
GERIATRIC AND MEDICAL SERVICES, INC.
XXXX-MED CORP.
GLENMARK ASSOCIATES - XXXX VIEW MANOR, INC.
GLENMARK ASSOCIATES, INC.
GLENMARK PROPERTIES, INC.
GMA-BRIGHTWOOD, INC.
GMA CONSTRUCTION, INC.
GMA-MADISON, INC.
GMA - UNIONTOWN, INC.
GMA PARTNERSHIP HOLDING COMPANY, INC.
GMC LEASING CORPORATION
GMC-LTC MANAGEMENT, INC.
GMS INSURANCE SERVICES, INC.
GOVERNOR'S HOUSE NURSING HOME, INC.
HEALTH RESOURCES OF ACADEMY MANOR, INC.
HEALTH RESOURCES OF XXXXXXXX, INC.
HEALTH RESOURCES OF BROOKLYN, INC.
HEALTH RESOURCES OF CEDAR GROVE, INC.
HEALTH RESOURCES OF CINNAMINSON, INC.
HEALTH RESOURCES OF COLCHESTER, INC.
HEALTH RESOURCES OF COLUMBUS, INC.
HEALTH RESOURCES OF CUMBERLAND, INC.
HEALTH RESOURCES OF ENGLEWOOD, INC.
HEALTH RESOURCES OF XXXXX, INC.
HEALTH RESOURCES OF FARMINGTON, INC.
HEALTH RESOURCES OF XXXXXXX, INC.
HEALTH RESOURCES OF GLASTONBURY, INC.
HEALTH RESOURCES OF GROTON, INC.
HEALTH RESOURCES OF LAKEVIEW, INC.
HEALTH RESOURCES OF LEMONT, INC.
HEALTH RESOURCES OF XXXXXXXX, INC.
HEALTH RESOURCES OF MIDDLETOWN (RI), INC.
HEALTH RESOURCES OF MORRISTOWN, INC.
HEALTH RESOURCES OF NORTH ANDOVER, INC.
HEALTH RESOURCES OF ROCKVILLE, INC.
HEALTH RESOURCES OF XXXX HILLS, INC.
HEALTH RESOURCES OF WALLINGFORD, INC.
HEALTH RESOURCES OF WARWICK, INC.
HEALTH RESOURCES OF WESTWOOD, INC.
HEALTHCARE RESOURCES CORP.
HELSTAT, INC.
HILLTOP HEALTH CARE CENTER, INC.
HMNH REALTY, INC.
HNCA, INC.
HORIZON ASSOCIATES, INC.
HORIZON MOBILE, INC.
HORIZON REHABILITATION, INC.
HR OF CHARLESTON, INC.
HRWV HUNTINGTON, INC.
INNOVATIVE HEALTH CARE MARKETING, INC.
KEYSTONE NURSING HOME, INC.
KNOLLWOOD MANOR, INC.
KNOLLWOOD NURSING HOME, INC.
LAKE MANOR, INC.
LAKEWOOD HEALTH RESOURCES, INC.
LAUREL HEALTH RESOURCES, INC.
LEHIGH NURSING HOMES, INC.
LIFE SUPPORT MEDICAL EQUIPMENT, INC.
LIFE SUPPORT MEDICAL, INC.
LRC HOLDING COMPANY, INC.
LWNR, INC.
MABRI CONVALESCENT CENTER, INC.
MANOR MANAGEMENT CORP. OF GEORGIAN MANOR, INC.
MARLINTON ASSOCIATES, INC.
MARLINTON PARTNERSHIP HOLDING COMPANY, INC.
XXXXXXXX HEALTH CARE CENTER-CONCORD, INC.
XXXXXXXX HEALTH CARE CENTERS, INC.
MERIDIAN HEALTH, INC.
MERIDIAN HEALTHCARE INVESTMENTS, INC.
MERIDIAN HEALTHCARE, INC.
MHNR, INC.
MNR, INC.
XXXXXXXXXX NURSING HOMES, INC.
MULTICARE AMC, INC.
NURSING AND RETIREMENT CENTER OF THE
ANDOVERS, INC.
OAK HILL HEALTH CARE CENTER, INC.
PHC OPERATING CORP.
PHILADELPHIA AVENUE CORPORATION
POCAHONTAS CONTINUOUS CARE CENTER, INC.
PRESCOTT NURSING HOME, INC.
PROSPECT PARK LTC MANAGEMENT, INC.
PROVIDENCE FUNDING CORPORATION
PROVIDENCE HEALTH CARE, INC.
REST HAVEN NURSING HOME, INC.
RHS MEMBERSHIP INTEREST HOLDING COMPANY
RIDGELAND HEALTH RESOURCES, INC.
RIVERSHORES HEALTH RESOURCES, INC.
RLNR, INC.
ROSE HEALTHCARE, INC.
ROSE VIEW MANOR, INC.
RSNR, INC.
RVNR, INC.
S. T. B. INVESTORS, LTD.
SCHUYLKILL NURSING HOMES, INC.
SENIOR LIVING VENTURES, INC.
SENIOR SOURCE, INC.
SNOW VALLEY HEALTH RESOURCES, INC.
SOLOMONT FAMILY MEDFORD VENTURE, INC.
XXXXXXXX CONVALESCENT CENTER, INC.
STATE STREET ASSOCIATES, INC.
SVNR, INC.
THE ADS GROUP, INC.
THE APPLE VALLEY PARTNERSHIP HOLDING
COMPANY, INC.
THE HOUSE OF XXXXXXXX, INC.
THE MULTICARE COMPANIES, INC.
THE XXXXX XXXXXXX PARTNERSHIP HOLDING
COMPANY, INC.
THE SOMERSET PARTNERSHIP HOLDING COMPANY, INC.
TMC ACQUISITION CORP.
TRI STATE MOBILE MEDICAL SERVICES, INC.
VALLEY MEDICAL SERVICES, INC.
VALLEY TRANSPORT AMBULANCE SERVICE, INC.
VERSALINK, INC.
VILLAS REALTY & INVESTMENTS, INC.
WALNUT LTC MANAGEMENT, INC.
WAYSIDE NURSING HOME, INC.
XXXXXXXXXX AMBULANCE SERVICE, INC.
WEST PHILA. LTC MANAGEMENT, INC.
WESTFORD NURSING AND RETIREMENT CENTER, INC.
WILLOW MANOR NURSING HOME, INC.
WYNCOTE HEALTHCARE CORP.
YE OLDE AMBULANCE COMPANY, INC.
YORK LTC MANAGEMENT, INC.
By: /s/ Xxxxx X. XxXxxx
---------------------------------------------
Name: Xxxxx X. XxXxxx
Title: Chief Financial Officer of each of
the foregoing entities
ADS APPLE VALLEY LIMITED PARTNERSHIP
By: ADS Apple Valley, Inc., its general partner
ADS HINGHAM LIMITED PARTNERSHIP
By: ADS Hingham Nursing Facility, Inc., its
general partner
ADS RECUPERATIVE CENTER LIMITED PARTNERSHIP
By: ADS Recuperative Center, Inc., its
general partner
BREVARD MERIDIAN LIMITED PARTNERSHIP
By: Meridian Healthcare, Inc., its
general partner
CARE HAVEN ASSOCIATES LIMITED PARTNERSHIP
By: Glenmark Associates, Inc., its
general partner
CATONSVILLE MERIDIAN LIMITED PARTNERSHIP
By: Meridian Healthcare, Inc. and Meridian
Health, Inc., its general partners
CUMBERLAND ASSOCIATES OF RHODE ISLAND, L.P.
By: Health Resources of Cumberland, Inc., its
general partner
EASTON MERIDIAN LIMITED PARTNERSHIP
By: Meridian Healthcare, Inc. and Meridian
Health, Inc., its general partners
EDELLA STREET ASSOCIATES
By: Genesis Health Ventures of Clarks Summit,
Inc., its general partner
GENESIS ELDERCARE CENTERS I, L.P.
By: Genesis Eldercare Partnership Centers, Inc.,
its general partner
GENESIS ELDERCARE CENTERS II, L.P.
By: Genesis Eldercare Partnership Centers, Inc.,
its general partner
GENESIS ELDERCARE CENTERS III, L.P.
By: Genesis Eldercare Partnership Centers, Inc.,
its general partner
GENESIS HEALTH VENTURES OF WEST VIRGINIA, LIMITED
PARTNERSHIP
By: Genesis ElderCare Network Services, Inc. and
Genesis ElderCare Rehabilitation Services,
Inc., its general partners
GENESIS PROPERTIES LIMITED PARTNERSHIP
By: Genesis Health Ventures of Arlington, Inc.,
its general partner
GENESIS PROPERTIES OF DELAWARE LTD. PARTNERSHIP, L.P.
By: Genesis Properties of Delaware Corporation,
its general partner
GLENMARK PROPERTIES I, LIMITED PARTNERSHIP
By: Glenmark Associates, Inc., its general
partner
GREENSPRING MERIDIAN LIMITED PARTNERSHIP
By: Meridian Healthcare, Inc., its general
partner
GROTON ASSOCIATES OF CONNECTICUT, L.P.
By: Health Resources of Groton, Inc., its general
partner
XXXXXXXX XXXX MERIDIAN LIMITED PARTNERSHIP
By: Meridian Healthcare, Inc. and Meridian
Health, Inc., its general partners
LAKE WASHINGTON, LTD.
By: Lake Manor, Inc., its general partner
XXXXXXXX HEALTH CARE CENTER-CONCORD LIMITED
PARTNERSHIP
By: XxXxxxxx Health Care Center-Concord, Inc.,
its general partner
MERIDIAN/CONSTELLATION LIMITED PARTNERSHIP
By: Meridian Healthcare, Inc., its general
partner
MERIDIAN EDGEWOOD LIMITED PARTNERSHIP
By: Meridian Healthcare, Inc., its general
partner
MERIDIAN PERRING LIMITED PARTNERSHIP
By: Meridian Healthcare, Inc., its general
partner
MERIDIAN VALLEY LIMITED PARTNERSHIP
By: Meridian Healthcare, Inc., its general
partner
MERIDIAN VALLEY VIEW LIMITED PARTNERSHIP
By: Meridian Healthcare, Inc., its general
partner
MIDDLETOWN (RI) ASSOCIATES OF RHODE ISLAND, L.P.
By: Health Resources of Middletown (RI), Inc.,
its general partner
MILLVILLE MERIDIAN LIMITED PARTNERSHIP
By: Meridian Healthcare, Inc., its general
partner
NORTH CAPE CONVALESCENT CENTER ASSOCIATES, L.P.
By: Geriatric and Medical Services, Inc., its
general partner
PHILADELPHIA AVENUE ASSOCIATES
By: Philadelphia Avenue Corporation, its general
partner
POINT PLEASANT HAVEN LIMITED PARTNERSHIP
By: Glenmark Associates, Inc. and GMA Partnership
Holding Company, Inc., its general partners
RALEIGH MANOR LIMITED PARTNERSHIP
By: Glenmark Associates, Inc., its general
partner
RIVER STREET ASSOCIATES
By: Genesis Health Ventures of Xxxxxx-Xxxxx,
Inc., its general partner
ROMNEY HEALTH CARE CENTER, LTD., LIMITED PARTNERSHIP
By: Glenmark Associates, Inc., its general
partner
SEMINOLE MERIDIAN LIMITED PARTNERSHIP
By: Meridian Health, Inc., its general partner
SISTERVILLE HAVEN LIMITED PARTNERSHIP
By: Glenmark Associates, Inc., its general
partner
XXXXXXXX ASSOCIATES OF N.J., L.P.
By: Southern Ocean GP, LLC, its general partner
STATE STREET ASSOCIATES, L.P.
By: State Street Associates, Inc., its general
partner
TEAYS VALLEY HAVEN LIMITED PARTNERSHIP
By: Glenmark Associates, Inc., its general
partner
THE APPLE VALLEY LIMITED PARTNERSHIP
By: The Apple Valley Partnership Holding Company,
Inc. and Apple Valley Operating Corp., its
general partners
THE XXXXXX GROUP-XXXXXXX HOUSE, L.P.
By: Encare of Wyncote, Inc., its general partner
THE XXXXXX GROUP-QUAKERTOWN MANOR, L.P.
By: Encare of Quakertown, Inc., its general
partner
THERAPY CARE SYSTEMS, L.P.
By: Genesis ElderCare Rehabilitation Services,
Inc., its general partner
VOLUSIA MERIDIAN LIMITED PARTNERSHIP
By: Meridian Health, Inc., its general partner
WALLINGFORD ASSOCIATES OF CONNECTICUT, L.P.
By: Health Resources of Wallingford, Inc., its
general partner
WARWICK ASSOCIATES OF RHODE ISLAND, L.P.
By: Health Resources of Warwick, Inc., its
general partner
WESTFORD NURSING AND RETIREMENT CENTER, LIMITED
PARTNERSHIP
By: Westford Nursing and Retirement Center, Inc.,
its general partner
By: /s/ Xxxxx X. XxXxxx
-------------------------------------------------
Name: Xxxxx X. XxXxxx
Title: Chief Financial Officer of the respective
general partners of each of the foregoing
entities
XXXXX XXXXX ASSOCIATES OF NEW JERSEY, L.P.
By: Encare of Mendham, L.L.C., its general partner
MERCERVILLE ASSOCIATES OF NEW JERSEY, L.P.
By: Breyut Convalescent Center, L.L.C., its general
partner
POMPTON ASSOCIATES, L.P.
By: Pompton Care, L.L.C., its general partner
THE XXXXXX GROUP-OLD BRIDGE, L.P.
By: Health Resources of Xxxxx, L.L.C., its general
partner
THE XXXXXX GROUP-RIDGEWOOD, L.P.
By: Health Resources of Ridgewood, L.L.C., its
general partner
By: Century Care Management, Inc., the manager of the
respective general partners of each of the foregoing
entities
By: /s/ Xxxxx X. XxXxxx
-----------------------------------------------
Name: Xxxxx X. XxXxxx
Title: Chief Financial Officer
SOMERSET RIDGE LIMITED PARTNERSHIP
By: Somerset Ridge LLC, its general partner
By: Somerset Ridge General Partnership, its Manager
By: Solomont Family Fall River Venture, Inc., its
general partner
By: /s/ Xxxxx X. XxXxxx
-----------------------------------------------
Name: Xxxxx X. XxXxxx
Title: Chief Financial Officer
ARCADIA ASSOCIATES
By: ADS/Multicare, Inc., its managing partner
By: /s/ Xxxxx X. XxXxxx
-----------------------------------------------
Name: Xxxxx X. XxXxxx
Title: Chief Financial Officer
XXXXXXXX HEALTH FACILITIES
By: Meridian Healthcare, Inc. and Meridian Health,
Inc., its partners
By: /s/ Xxxxx X. XxXxxx
-----------------------------------------------
Name: Xxxxx X. XxXxxx
Title: Chief Financial Officer
XXXXX XXXXXXX GENERAL PARTNERSHIP
By: ADS Multicare Inc. and The Xxxxx Xxxxxxx
Partnership Holding Company, Inc., its general
partners
By: /s/ Xxxxx X. XxXxxx
----------------------------------------------
Name: Xxxxx X. XxXxxx
Title: Chief Financial Officer
SOMERSET RIDGE GENERAL PARTNERSHIP
By: Solomont Family Fall River Venture, Inc. and
The Somerset Partnership Holding Company, Inc.,
its general partners
By: /s/ Xxxxx X. XxXxxx
----------------------------------------------
Name: Xxxxx X. XxXxxx
Title: Chief Financial Officer
BREYUT CONVALESCENT CENTER, L.L.C.
ENCARE OF MENDHAM, L.L.C.
HEALTH RESOURCES OF BRIDGETON, L.L.C.
HEALTH RESOURCES OF CINNAMINSON, L.L.C.
HEALTH RESOURCES OF CRANBURY, L.L.C.
HEALTH RESOURCES OF EATONTOWN, L.L.C.
HEALTH RESOURCES OF XXXXX, L.L.C.
HEALTH RESOURCES OF ENGLEWOOD, L.L.C.
HEALTH RESOURCES OF XXXXX, L.L.C.
HEALTH RESOURCES OF FAIR LAWN, L.L.C.
HEALTH RESOURCES OF XXXXXXX, L.L.C.
HEALTH RESOURCES OF RIDGEWOOD, L.L.C.
HEALTH RESOURCES OF SOUTH BRUNSWICK, L.L.C.
HEALTH RESOURCES OF WEST ORANGE, L.L.C.
POMPTON CARE, L.L.C.
ROEPHEL CONVALESCENT CENTER, L.L.C.
By: Century Care Management, Inc., the manager of
each of the foregoing entities
By: /s/ Xxxxx X. XxXxxx
--------------------------------------------
Name: Xxxxx X. XxXxxx
Title: Chief Financial Officer
GENESIS-GEORGETOWN SNF/JV, LLC
GLENMARK LIMITED LIABILITY COMPANY I
MILFORD ALF, LLC
RESPIRATORY HEALTH SERVICES LLC
RIVERVIEW RIDGE LIMITED LIABILITY COMPANY
SOUTHERN OCEAN GP, L.L.C.
By: /s/ Xxxxx X. XxXxxx
----------------------------------------------
Name: Xxxxx X. XxXxxx
Title: Chief Financial Officer
SOMERSET RIDGE L.L.C.
By: Somerset Ridge General Partnership, its Manager
By: Solomont Family Fall River Venture, Inc., its
general partner
By: The Somerset Partnership Holding Company, Inc.,
its general partner
By: /s/ Xxxxx X. XxXxxx
-------------------------------------------
Name: Xxxxx X. XxXxxx
Title: Chief Financial Officer
Accepted as of the date hereof
WACHOVIA CAPITAL MARKETS, LLC
Acting on behalf of itself and the several Initial
Purchasers named in Schedule I hereto.
By: WACHOVIA CAPITAL MARKETS, LLC
By: /s/ Xxxxxxxx Xxxxx
---------------------------------------------
Name: Xxxxxxxx Xxxxx
Title:Director
SCHEDULE 1(D)
NON WHOLLY OWNED SUBSIDIARIES
ADS-NDNE Danvers, LLC
ADS-NDNE Dartmouth LLC
Atrium Village Development, LLC
Berkeley Haven Limited Partnership
Canterbury of Shepherdstown Limited Partnership
Capital Region/Genesis ElderCare L. L. C.
Care Haven Associates Limited Partnership
Xxxxx Manor Meridian Limited Partnership
Community Provider Network of Central NH, LLC
Courtyard Nursing Care Center Partnership
Dartmouth Assisted Living LLC
Dover ALF LLC f/k/a Capitol SNF, L. L. C.
Franklin Health Care Associates
Franklin Square/Meridian Healthcare Nursing Home Limited Partnership
Xxxxxxxxx Meridian Limited Partnership
Genesis Atrium LLC
Genesis/Harbor LLC f/k/a Harbor/Genesis J. V., LLC
Xxxxxxxx 1
Glenmark Properties I, Limited Partnership
Xxxxxxxx Meridian Limited Partnership
Heritage at Danvers, LLC
Kittarin, LLC
Magnolia Gardens L. L. C.
Markglen, Inc.
Marlinton Associates Limited Partnership
Meridian Healthcare Growth & Income Fund Limited Partnership
Mooresville Meridian Limited Partnership
Peninsula Regional/Genesis ElderCare, LLC f/k/a Wicomico/Genesis ElderCare
LLC f/k/a Peninsula Regional/Genesis ElderCare, LLC
Plainfield Meridian Limited Partnership
PRMC/GEC at Salisbury Center, LLC f/k/a GE at Salisbury, LLC f/k/a
PRMC/GEC at Salisbury Center, LLC
Randallstown Meridian Limited Partnership
SOG Drilling Program 1983-2
Xxxxxxx Meridian Limited Partnership
SCHEDULE I
$150,000,000 OF FIRM
SECURITIES TO BE
INITIAL PURCHASER PURCHASED
----------------------------------------------------------- --------------------
Wachovia Capital Markets, LLC.............................. $ 89,732,000
Xxxxxxxxx & Company, Inc................................... $ 37,308,000
Citigroup Global Markets Inc............................... $ 22,960,000
------------
Total:............................................ $150,000,000
============
SCHEDULE II
SUBSIDIARIES DESCRIBED IN SECTION 1(n) OF PURCHASE AGREEMENT
Genesis Eldercare Rehabilitation Services, Inc.
Geriatric & Medical Services, Inc.
The Multicare Companies, Inc.
Genesis Eldercare Network Services, Inc.
Meridian Healthcare, Inc.
Meridian Health, Inc.
XxXxxxxx Health Care Centers, Inc.
Glenmark Associates, Inc.
Genesis Health Ventures of Massachusetts, Inc.
Genesis Health Ventures of Salisbury, Inc.
ADS/Multicare, Inc.
Genesis Health Ventures of Bloomfield, Inc.
SCHEDULE III
Officers of the Company to be subject to the Lock-Up Agreements with the Initial
Purchasers
Xxxxxx X. Xxxxx, Xx.
Xxxxx X. XxXxxx
Xxxxxx X. Xxxxx
Xxxxxx X. Xxxxxxx
Xxxxxxx X. Xxxxxxxx
Xxxxxxx Xxxx, Xx.
Xxxxxx XxXxxxxxxx
EXHIBIT A
FORM OF OPINION OF BLANK ROME LLP
The opinion of Blank Rome LLP, to be delivered pursuant to Section 5(c) of
the Purchase Agreement shall be to the effect that:
A. The Company is a corporation incorporated and existing under the laws
of the Commonwealth of Pennsylvania, has the corporate power and authority to
own its property and to conduct its business as described in the Memorandum and
is duly qualified to transact business and is in good standing in each
jurisdiction in which the conduct of its business or its ownership or leasing of
property requires such qualification, except to extent that the failure to be so
qualified or be in good standing would not have a Material Adverse Effect.
B. The Company and each of the Significant Guarantors have corporate power
and authority to enter into and perform their respective obligations under each
of the Purchase Agreement, the Registration Rights Agreement, the Indenture, the
Securities, and the Subsidiary Guarantees to which it is a party.
C. Each of the Significant Guarantors is a corporation validly existing
under the laws of its jurisdiction of incorporation; each of the Significant
Guarantors has the corporate power and authority to own, lease and operate its
properties and to conduct its business as described in the Memorandum, is duly
qualified as a foreign entity to transact business and is in good standing in
each jurisdiction in which the conduct of business or ownership or leasing of
property requires such qualification, except where the failure so to qualify or
to be in good standing would not have a Material Adverse Effect; the issued and
outstanding capital stock or ownership interests, as the case may be, of each of
the Significant Guarantors has been duly authorized and validly issued, is fully
paid and non-assessable, and is, to our knowledge after due inquiry, owned by
the Company, directly or indirectly.
D. The shares of Common Stock outstanding prior to the issuance of the
Securities have been duly authorized and are validly issued, fully paid and
non-assessable.
E. The Purchase Agreement has been duly authorized, executed and delivered
by the Company and each of the Significant Guarantors.
F. The Securities have been duly authorized by the Company and, when
executed and authenticated in accordance with the provisions of the Indenture
and delivered to and paid for by the Initial Purchasers in accordance with the
terms of the Purchase Agreement, will be valid and binding obligations of the
Company, enforceable in accordance with their terms, subject to applicable
bankruptcy, fraudulent conveyance, insolvency and similar laws affecting
A-1
creditors' rights generally and equitable principles of general applicability
and an implied covenant of good faith and fair dealing.
G. The Underlying Securities initially issuable upon conversion of the
Securities have been duly and validly authorized and reserved and, when issued
upon conversion of the Securities in accordance with the terms of the
Securities, will be validly issued, fully paid and non-assessable, and the
issuance of the Underlying Securities will not be subject to any preemptive or
similar rights under the Company's articles of incorporation or Pennsylvania
law.
H. The Significant Guarantors' Guarantees have been duly and validly
authorized by each of the Significant Guarantors and when the Significant
Guarantors' Guarantees are duly endorsed on the Securities in accordance with
the terms of the Indenture and delivered to and paid for by the Initial
Purchasers pursuant to the Purchase Agreement on the Closing Date, assuming due
authentication of the Securities by the Trustee, such Significant Guarantors'
Guarantees will constitute legally valid and binding obligations of the
respective Significant Guarantors, entitled to the benefits of the Indenture and
enforceable against the respective Guarantors in accordance with their terms,
subject to the applicable bankruptcy, fraudulent conveyance, insolvency, and
similar laws affecting creditors' rights generally and equitable principles of
general applicability and an implied covenant of good faith and fair dealing.
I. Each of the Indenture and the Registration Rights Agreement have been
duly authorized, executed and delivered by, and is a valid and binding agreement
of, the Company and each of the Significant Guarantors, enforceable in
accordance with its terms, subject to applicable bankruptcy, fraudulent
conveyance, insolvency and similar laws affecting creditors' rights generally
and equitable principles of general applicability and an implied covenant of
good faith and fair dealing.
J. The execution and delivery by the Company and the Significant
Guarantors, and the performance by the Company and the Significant Guarantors of
their obligations under, the Purchase Agreement, the Indenture, the Registration
Rights Agreement, the Securities and the Subsidiary Guarantees will not result
in (i) the violation in any material respect of any provision of applicable law
or the certificate of incorporation or by-laws of the Company or any such
Significant Guarantor, or any judgment, order or decree of any governmental
body, agency or court having jurisdiction over such entity known to such
counsel, or (ii) breach of, or default under, any agreement or other instrument
binding upon any such entity that is filed as an exhibit to the Company's
periodic reports under the Exchange Act, and no consent, approval, authorization
or order of, or qualification with, any governmental body or agency is required
for the performance by the Company or any Significant Guarantor of its
respective obligations under the Purchase Agreement, the Indenture, the
Registration Rights Agreement, the Securities or the Subsidiary Guarantees, as
the case may be,
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except such as may be required by the securities or Blue Sky laws of the various
states in connection with the offer and sale of the Securities, Subsidiary
Guarantees and Underlying Securities and by Federal and state securities laws
with respect to the conversion of the Securities and the Company's and the
Guarantors' obligations under the Registration Rights Agreement.
K. Such counsel does not know of any legal or governmental proceedings
pending or threatened to which the Company or any of its subsidiaries is a party
or to which any of the properties of such entity is subject other than
proceedings summarized in the Memorandum and proceedings which such counsel
believes are not required to be described in the Company's periodic reports or
likely to have a material adverse effect on the power or ability of the Company
or any Guarantor to perform its respective obligations under the Purchase
Agreement, the Indenture, the Registration Rights Agreement, the Securities or
the Subsidiary Guarantees, as the case may be, or to consummate the transactions
contemplated therein.
L. The Company is not, and after giving effect to the offering and sale of
the Securities and the application of the proceeds thereof as described in the
Memorandum will not be, an "investment company" as such term is defined in the
Investment Company Act of 1940, as amended.
M. The statements relating to legal matters, documents or proceedings
included in the Memorandum under the captions "Description of the Debentures"
and "Description of Capital Stock" and "Business -- Revenue Sources" and
"Business -- Government Regulation", insofar as such descriptions constitute a
summary of the legal matters, documents or proceedings referred to therein,
fairly summarize in all material respects such matters, documents or
proceedings.
N. Although the discussion set forth in the Memorandum under the caption
"Certain United States Federal Income Tax Considerations" does not purport to
summarize all possible United States federal income tax consequences of the
acquisition, ownership, and disposition of the Securities, such discussion
constitutes, in all material respects, a fair and accurate summary of the United
States federal income tax considerations that are anticipated to be material to
persons who purchase the Securities pursuant to the Memorandum.
O. Based upon the representations, warranties and agreements of the
Company, the Guarantors and the Initial Purchasers in the Purchase Agreement, it
is not necessary in connection with the offer, sale and delivery of the
Securities to the Initial Purchasers under the Purchase Agreement or in
connection with the initial resale of such Securities by the Initial Purchasers
in accordance with the Purchase Agreement to register the Securities, the
Subsidiary Guarantees or the Underlying Securities under the Securities Act of
1933 or to qualify the Indenture under the Trust Indenture Act of 1939, it being
understood that no opinion is expressed as to any subsequent resale of any
Security, Subsidiary Guarantee or Underlying Security.
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Nothing has come to the attention of such counsel that causes such counsel
to believe that (i) any document incorporated by reference in the Memorandum
(except for the financial statements and financial schedules and other financial
and statistical data included therein, as to which such counsel need not express
any belief), did not comply as to form when filed with the Commission in all
material respects with the Exchange Act and the rules and regulations of the
Commission thereunder or (ii) the Memorandum (except for the financial
statements and financial schedules and other financial and statistical data, as
to which such counsel need not express any belief) when issued contained, or as
of the date such opinion is delivered contains, any untrue statement of a
material fact or omitted or omits to state a material fact necessary in order to
make the statements therein, in the light of the circumstances under which they
were made, not misleading.
With respect to the matters referred to in the paragraph above, counsel
may state that his or her beliefs are based upon his or her participation in the
preparation of the Memorandum (and any amendments or supplements thereto) and
review and discussion of the contents thereof and review of the documents
incorporated by reference therein, but are without independent check or
verification except as specified.
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EXHIBIT B
OPINION OF XXXXX XXXX & XXXXXXXX
The opinion of Xxxxx Xxxx & Xxxxxxxx to be delivered pursuant to Section
5(d) of the Purchase Agreement shall be to the effect that:
A. Assuming that the Securities have been duly authorized by the Company,
the Securities, when executed and authenticated in accordance with the
provisions of the Indenture and delivered to and paid for by the Initial
Purchasers in accordance with the terms of the Purchase Agreement, will be valid
and binding obligations of the Company, enforceable in accordance with their
terms, subject to applicable bankruptcy, insolvency and similar laws affecting
creditors' rights generally and equitable principles of general applicability,
and will be entitled to the benefits of the Indenture and the Registration
Rights Agreement pursuant to which such Securities are to be issued.
B. The Subsidiary Guarantees have been duly and validly authorized by each
of the Delaware Guarantors, and assuming that the Subsidiary Guarantees have
been duly and validly authorized by each other Guarantor, the Subsidiary
Guarantees, when duly endorsed on the Securities in accordance with the terms of
the Indenture and delivered to and paid for by the Initial Purchasers pursuant
to the Purchase Agreement on the Closing Date, will constitute legally valid and
binding obligations of each respective Guarantor, entitled to the benefits of
the Indenture and enforceable against such Guarantor in accordance with their
terms, subject to the applicable bankruptcy, insolvency, and similar laws
affecting creditors' rights generally and equitable principles of general
applicability.
C. Each of the Indenture and the Registration Rights Agreement has been
duly authorized, executed and delivered by each of the Delaware Guarantors, and
assuming that each of the Indenture and Registration Rights Agreement has been
duly authorized, executed and delivered by the Company and each other Guarantor,
each of the Indenture and the Registration Rights Agreement is a valid and
binding agreement of the Company and each Guarantor, enforceable in accordance
with its terms, subject to applicable bankruptcy, insolvency and similar laws
affecting creditors' rights generally and equitable principles of general
applicability, and except as rights to indemnification and contribution under
the Registration Rights Agreement may be limited under applicable law.
D. The statements relating to legal documents included in the Memorandum
under the captions "Description of the Debentures", "Plan of Distribution" and
"Transfer Restrictions", insofar as they summarize provisions of the Indenture,
the Securities and the Purchase Agreement, fairly summarize in all material
respects such documents.
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E. Nothing has come to the attention of such counsel to cause such counsel
to believe that (except for the financial statements and financial schedules and
other financial and statistical data, as to which such counsel need not express
any belief) the Memorandum when issued contained, or as of the date such opinion
is delivered contains, any untrue statement of a material fact or omitted or
omits to state a material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were made, not
misleading.
With respect to the matters referred to in the paragraph above, Xxxxx Xxxx
& Xxxxxxxx may state that their beliefs are based upon their participation in
the preparation of the Memorandum (and any amendments or supplements thereto)
and review and discussion of the contents thereof (including the review of, but
not participation in the preparation of, the incorporated documents), but are
without independent check or verification except as specified.
F. Based upon the representations, warranties and agreements of the
Company, of the Guarantors and of the Initial Purchasers in the Purchase
Agreement, it is not necessary in connection with the offer, sale and delivery
of the Securities to the Initial Purchasers under the Purchase Agreement or in
connection with the initial resale of such Securities by the Initial Purchasers
in accordance with the Purchase Agreement to register the Securities, the
Subsidiary Guarantees or the Underlying Securities under the Securities Act of
1933 or to qualify the Indenture under the Trust Indenture Act of 1939, it being
understood that no opinion is expressed as to any subsequent resale of any
Security, Subsidiary Guarantee or Underlying Security.
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EXHIBIT C
FORM OF LOCK-UP LETTER
February 24, 2005
Wachovia Capital Markets, LLC
c/o Wachovia Capital Markets, LLC
000 Xxxxx Xxxxxxx Xxxxxx, 0xx Xxxxx
Xxxxxxxxx, Xxxxx Xxxxxxxx 00000-0000
Dear Sirs and Mesdames:
The undersigned understands that you propose to enter into a Purchase
Agreement (the "PURCHASE AGREEMENT") with Genesis HealthCare Corporation, a
Pennsylvania corporation (the "COMPANY"), providing for the offering (the
"OFFERING") by Wachovia Capital Markets, LLC, and such other initial purchasers
identified therein (collectively, the "INITIAL PURCHASERS") of the Company's
Convertible Senior Subordinated Debentures Due 2025 (the "SECURITIES"). The
Securities will be convertible into shares of common stock, par value $0.01, of
the Company (the "COMMON STOCK").
To induce the Initial Purchasers to continue their efforts in connection
with the Offering, the undersigned hereby agrees that, without the prior written
consent of Wachovia Capital Markets, LLC on behalf of the Initial Purchasers, it
will not, during the period commencing on the date hereof and ending 90 days
after the date of the offering memorandum relating to the Offering (the
"MEMORANDUM"), (1) offer, pledge, sell, contract to sell, sell any option or
contract to purchase, purchase any option or contract to sell, grant any option,
right or warrant to purchase, lend, or otherwise transfer or dispose of,
directly or indirectly, any shares of Common Stock or any securities convertible
into or exercisable or exchangeable for Common Stock or (2) enter into any swap
or other arrangement that transfers to another, in whole or in part, any of the
economic consequences of ownership of the Common Stock, whether any such
transaction described in clause (1) or (2) above is to be settled by delivery of
Common Stock or such other securities, in cash or otherwise. The foregoing
sentence shall not apply to (i) transactions relating to shares of Common Stock
or other securities acquired in open market transactions after the completion of
the Offering, (ii) the sale, transfer or disposition of shares of the Common
Stock in an amount not to exceed, when aggregated with all sales, transfers or
dispositions of officers of the Company who have executed similar letter
agreements, 200,000
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shares or (iii) the exercise of any options to acquire shares of Common Stock
pursuant to the Company's employee benefit plans existing on the date hereof. In
addition, the undersigned agrees that, without the prior written consent of
Wachovia Capital Markets, LLC on behalf of the Initial Purchasers, it will not,
during the period commencing on the date hereof and ending 90 days after the
date of the Memorandum, make any demand for or exercise any right with respect
to, the registration of any shares of Common Stock or any security convertible
into or exercisable or exchangeable for Common Stock. The undersigned also
agrees and consents to the entry of stop transfer instructions with the
Company's transfer agent and registrar against the transfer of the undersigned's
shares of Common Stock except in compliance with the foregoing restrictions.
The undersigned understands that the Company and the Initial Purchasers
are relying upon this Lock-Up Agreement in proceeding toward consummation of the
Offering. The undersigned further understands that this Lock-Up Agreement is
irrevocable and shall be binding upon the undersigned's heirs, legal
representatives, successors and assigns.
Whether or not the Offering actually occurs depends on a number of
factors, including market conditions. Any Offering will only be made pursuant to
a Purchase Agreement, the terms of which are subject to negotiation between the
Company and the Initial Purchasers. This Lock-Up Agreement shall terminate and
be of no further force and effect if the Offering has not been consummated on or
before April 1, 2005.
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Very truly yours,
___________________________________
(Name)
___________________________________
(Title)
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